foreign [Music] welcome to this Cube showcase accelerating business transformation with VMware Cloud on aw it's a solution Innovation conversation with two great guests Fred Ward and VP of Commercial Services at AWS and Narayan bardawaj who's the VP and general manager of cloud Solutions at VMware gentlemen thanks for uh joining me on the Showcase great to be here hey thanks for having us on it's a great topic you know we we've been covering this VMware Cloud on AWS since since the launch going back and it's been amazing to watch The Evolution from people saying oh it's the worst thing I've ever seen what's this mean uh and depressed we're we're kind of not really on board with kind of the vision but as it played out as you guys had announced together it did work out great for VMware it did work out great for a divs and it continues two years later and I want to just get an update from you guys on where you guys see this has been going obviously multiple years where is the evolution of the solution as we are right now coming off VMware Explorer just recently and going in to reinvent uh which is only a couple weeks away uh this feels like tomorrow but you know as we prepare a lot going on where are we with the evolution of the solution I mean the first thing I want to say is you know October 2016 was a seminal moment in the history of I.T right when bad girls singer and Andy jassy came together to announce this and I think John you were there at the time I was there it was a great great moment we launched the solution in 2017 the year after that at vmworld back when we called it vmworld I think we've gone from strength to strength one of the things that has really mattered to us is we've learned from AWS also and the process is this notion of working backwards so we're really really focused on customer feedback as we build the service offering now five years old pretty remarkable Journey uh you know in the first years we tried to get across all the regions you know that was a big Focus because there was so much demand for it in the second year we started going really on Enterprise great features we invented this pretty awesome feature called stretch clusters where you could stretch a vsphere cluster using vsan NSX across two azs in the same region pretty phenomenal for lines of availability that applications start started to get with that particular feature and we kept moving forward all kinds of integration with AWS direct connect Transit gateways with our own Advanced networking capabilities uh you know along the way Disaster Recovery we punched out you need two new Services just focused on that and then more recently we launched our outposts partnership we were up on the stage at reinvent again with Pat and Andy announcing AWS outposts and the VMware flavor of that VMware cloud and AWS outposts I think it's been significant growth in our federal sector as well the federal Empire certification more recently so all in all we're super excited we're five years old the customer momentum is really really strong we are scaling the service massively across all GEOS and industries that's great great update and I think one of the things that you mentioned was how the advantages you guys got from that relationship and this has kind of been the theme for AWS man since I can remember from day one Fred you guys do the heavy lifting as as it's always say for the customers here VMware comes on board takes advantage of the AWS and kind of just doesn't miss a beat continues to move their workloads that everyone's using you know vsphere and these are these are Big workloads on AWS what's the AWS perspective on this how do you see it yeah uh it's pretty fascinating to watch how fast customers can actually transform and move when you take the the skill set that they're familiar with and the advanced capabilities that they've been using on-prem and then overlay it on top of the AWS infrastructure that's that's evolving quickly and and building out new hardware and new instances we'll talk about uh but that combined experience between both of us on a jointly engineered solution uh to bring the best security and the best features that really matter for those workloads uh drive a lot of efficiency and speed for the for the customer so it's been well received and the partnership is stronger than ever from an engineering standpoint from a business standpoint and obviously it's been very interesting to look at just how we stay day one in terms of looking at new features and work and and responding to what customers want so pretty pretty excited about just seeing the transformation and the speed that which customers can move to uh BMC yeah that's a great value probably we've been talking about that in context to anyone building on top of the cloud they can have their own super cloud as we call it if you take advantage of all the capex and investment Amazon's made and AWS is made and and continues to make in performance I as and pass all great stuff I have to ask you guys both as you guys see this going to the next level what are some of the differentiations you see around the service compared to other options on the market what makes it different what's the combination you mentioned jointly engineered what are some of the key differentias of the service compared to others yeah I think one of the key things red talked about is this jointly engineered notion right from day one we were the earlier doctors of the AWS Nitro platform right the reinvention of ec2 back five years ago and so we've been you know having a very very strong engineering partnership at that level I think from uh we have a customer standpoint you get the full software-defined data center compute storage networking on ec2 bare metal across all regions you can scale that elastically up and down it's pretty phenomenal just having that consistency Global right on AWS ec2 Global regions now the other thing that's a real differentiator for us customers tell us about is this whole notion of a managed service right and this was somewhat new to VMware this undifferentiated heavy lifting where customers are to provision rack stack Hardware configure the software on top and then upgrade the software and the security patches on top so we took away all of that pain as customers transition to VMware cloud and AWS in fact my favorite story from last year when we were all going through the lock for Jay debacle the industry was just going through that right favorite proof point from customers was before they could even race uh this issue to us we sent them a notification saying uh we already patched all of your systems no action from you the customers were super thrilled I mean these are large Banks many other customers around the world super thrill they had to take no action for a pretty incredible industry challenge that we were all facing that's a great point you know the whole managed service piece brings up the security and you're kind of teasing at it but you know there's always vulnerabilities that emerge when you're doing complex logic and as you grow your Solutions there's more bits you know Fred we were commenting before we came on cameras more bits than ever before and and at the physics layer too as well as the software so you never know when there's going to be a zero day vulnerability out there just it happens we saw one with Fortinet this week um this came out of the woodwork but moving fast on those patches is huge this brings up the whole support angle I wanted to ask you about how you guys are doing that as well because to me we see the value when we when we talk to customers on the cube about this you know it was a real real easy understanding of how what the cloud means to them with VMware now with the AWS but the question that comes up that we want to get more clarity on is how do you guys handle the support together well what's interesting about this is that it's it's done mutually we have dedicated support teams on both sides that work together pretty seamlessly to make sure that whether there's a issue at any layer including all the way up into the app layer as you think about some of the other workloads like sap we'll go end to end and make sure that we support the customer regardless of where the particular issue might be for them uh and on top of that we look at where where we're improving reliability in as a first order of principle between both companies so from an availability and reliability standpoint it's it's top of mind and no matter where the particular item might land we're going to go help the customer resolve that works really well on the VMware side let's spend the feedback there what's the what's some of the updates same scene yeah yeah I think uh look I mean VMware owns and operates the service will be a phenomenal back in relationship with AWS customers call VMware for the service for any issues and then we have a awesome relationship with AWS in the back end for support issues for any hardware issues capacity management that we jointly do right all the hard problems that customers don't have to worry about uh I think on the front end we also have a really good group of solution Architects across the companies that help to really explain the solution do complex things like Cloud migration which is much much easier with VMware on AWS we're presenting that easy button to the public cloud in many ways and so we have a whole technical audience across the two companies that are working with customers every single day you know you had mentioned a list here some of the Innovations the you mentioned the stretch clustering you know getting the GEOS working Advanced Network disaster recovery um you know fed fed ramp public sector certifications outposts all good you guys are checking the boxes every year you got a good good accomplishments list there on the VMware AWS side here in this relationship the question that I'm interested in is what's next what uh recent Innovations are you doing are you making investments in what's on the list this year what items will be next year how do you see the the new things the list of the cosmos people want to know what's next they don't want to see stagnant uh growth here they want to see more action you know as as uh Cloud kind of continues to scale and modern applications Cloud native you're seeing more and more containers more and more you know more CF CI CD pipelining with with modern apps putting more pressure on the system what's new what's the new Innovations absolutely and I think as a five-year-old service offering uh Innovation is top of mind for us every single day so just to call out a few recent innovations that we announced in San Francisco at VMware Explorer um first of all uh our new platform i4i dot metal it's isolate based it's pretty awesome it's the latest and greatest uh all the speeds and beats that you would expect from VMware and AWS at this point in our relationship we announced two different storage options this notion of working from customer feedback allowing customers even more price reductions really take off that storage and park it externally right and you know separate that from compute so two different storage offerings there one is with AWS FSX NetApp on tap which brings in our NetApp partnership as well into the equation and really get that NetApp based really excited about this offering as well and the second storage offering called VMware Cloud Flex story vmware's own managed storage offering beyond that we've done a lot of other Innovations as well I really wanted to talk about VMware Cloud Flex compute where previously customers could only scale by hosts you know host is 36 to 48 cores give or take but with VMware cloudflex compute we are now allowing this notion of a resource defined compute model where customers can just get exactly the vcpu memory and storage that maps to the applications however small they might be so this notion of granularity is really a big innovation that that we are launching in the market this year and then last but not least topper ransomware of course it's a Hot Topic in the industry we are seeing many many customers ask for this we are happy to announce a new ransomware recovery with our VMware Cloud VR solution a lot of innovation there and the way we are able to do machine learning and make sure the workloads that are covered from snapshots backups are actually safe to use so there's a lot of differentiation on that front as well a lot of networking Innovations with project North Star the ability to have layer 4 through layer seven uh you know new SAS services in that area as well keep in mind that the service already supports managed kubernetes for containers it's built in to the same clusters that have virtual machines and so this notion of a single service with a great TCO for VMS and containers is sort of at the heart of our option the networking side certainly is a hot area to keep innovating on every year it's the same same conversation get better faster networking more more options there the flex computes interesting if you don't mind me getting a quick clarification could you explain the address between resource defined versus Hardware defined because this is kind of what we had saw at explore coming out that notion of resource defined versus Hardware defined what's that what does that mean yeah I mean I think we've been super successful in this Hardware defined notion where we're scaling by the hardware unit uh that we present as software-defined data centers right so that's been super successful but we you know customers wanted more especially customers in different parts of the world wanted to start even smaller and grow even more incrementally right lower the cost even more and so this is the part where resource defined starts to be very very interesting as a way to think about you know here's my bag of resources exactly based on what the customer's requested it would be for fiber machines five containers its size exactly for that and then as utilization grows we elastically behind the scenes were able to grow it through policies so that's a whole different dimension it's a whole different service offering that adds value when customers are comfortable they can go from one to the other they can go back to that post-based model if they so choose to and there's a jump off point across these two different economic models it's kind of cloud flexibility right there I like the name Fred let's get into some of the uh examples of customers if you don't mind let's get into some of these we have some time I want to unpack a little bit of what's going on with the customer deployments one of the things we've heard again on the cube is from customers is they like the clarity of the relationship they love the cloud positioning of it and then what happens is they lift and shift the workloads and it's like feels great it's just like we're running VMware on AWS and then they start consuming higher level Services kind of that adoption Next Level happens um and because it's in the cloud so so can you guys take us through some recent examples of customer wins or deployments where they're using VMware Cloud on AWS on getting started and then how do they progress once they're there how does it evolve can you just walk us through a couple use cases sure um there's a well there's a couple one it's pretty interesting that you know like you said as there's more and more bids you need better and better hardware and networking and we're super excited about the I-4 uh and the capabilities there in terms of doubling and or tripling what we're doing around a lower variability on latency and just improving all the speeds but what customers are doing with it like the college in New Jersey they're accelerating their deployment on a on onboarding over like 7 400 students over a six to eight month period and they've really realized a ton of savings but what's interesting is where and how they can actually grow onto additional native Services too so connectivity to any other services is available as they start to move and migrate into this um the the options there obviously are tied to all the Innovation that we have across any Services whether it's containerized and with what they're doing with tanzu or with any other container and or services within AWS so so there's there's some pretty interesting scenarios where that data and or the processing which is moved quickly with full compliance whether it's in like health care or regulatory business is is allowed to then consume and use things for example with text extract or any other really cool service that has you know monthly and quarterly Innovations so there's things that you just can't could not do before that are coming out uh and saving customers money and building Innovative applications on top of their uh their current uh app base in in a rapid fashion so pretty excited about it there's a lot of examples I think I probably don't have time to go into too many here yeah but that's actually the best part is listening to customers and seeing how many net new services and new applications are they actually building on top of this platform now Ryan what's your perspective from the VMware psychics you know you guys have now a lot of head room to offer customers with Amazon's you know higher level services and or whatever's homegrown what is being rolled out because you now have a lot of hybrid too so so what's your what's your take on what what's happening and with customers I mean it's been phenomenal the customer adoption of this and you know Banks and many other highly sensitive verticals are running production grade applications tier one applications on the service over the last five years and so you know I have a couple of really good examples SNP Global is one of my favorite examples large Bank the merch with IHS Market big sort of conglomeration now both customers were using VMware cloud and AWS in different ways and with the uh with the use case one of their use cases was how do I just respond to these Global opportunities without having to invest in physical data centers and then how do I migrate and consolidate all my data centers across the globe of which there were many and so one specific example for this company was how they migrated thousand one thousand workloads to VMware cloud and AWS in just six weeks pretty phenomenal if you think about everything that goes into a cloud migration process people process technology and the beauty of the technology going from VMware point a to VMware point B the the lowest cost lowest risk approach to adopting we have our cloud in AWS so that's uh you know one of my favorite examples there are many other examples across other verticals that we continue to see the good thing is we're seeing rapid expansion across the globe we're constantly entering new markets uh with a limited number of regions and progressing our roadmap it's great to see I mean the data center migrations go from months many many months to weeks it's interesting to see some of those success stories so congratulations another one of the other uh interesting uh and fascinating uh uh benefits is the sustainability Improvement in terms of being green so the efficiency gains that we have both in current uh generation and New Generation processors and everything that we're doing to make sure that when a customer can be elastic they're also saving power which is really critical in a lot of regions worldwide at this point in time they're they're seeing those benefits if you're running really inefficiently in your own data center that is just a not a great use of power so the actual calculators and the benefits to these workloads is are pretty phenomenal just in being more green which I like we just all need to do our part there and and this is a big part of it here it's a huge it's a huge point about sustainability for everyone glad you called that out the other one I would say is supply chain issues another one you see that constrains I can't buy hardware and the third one is really obvious but no one really talks about it it's security right I mean um I remember interviewing Steven Schmidt with that AWS and many years ago this is like 2013 and um you know at that time people saying the Cloud's not secure and he's like listen it's more secure in the cloud than on premise and if you look at the security breaches it's all about the on-premise data center vulnerabilities not so much Hardware so there's a lot you gotta the the stay current on on the isolation there is hard so I think I think the security and supply chain threat is another one do you agree I I absolutely agree uh it's it's hard to manage supply chain nowadays we put a lot of effort into that and I think we have a great ability to forecast and make sure that we can lean in and have the resources that are available and run them run them more efficiently yeah and then like you said on the security Point Security is job one it is it is the only P1 and if you think of how we build our infrastructure from Nitro all the way up and how we respond and work with our partners and our customers there's nothing more important and Narayan your point earlier about the managed service patching and being on top of things is really going to get better all right final question I really want to thank you for your time on this showcase it's really been a great conversation uh Fred you had made a comment earlier I want to kind of end with the kind of a curveball and put you guys on the spot we're talking about a modern a new modern shift it's another we're seeing another inflection point we've been documenting it it's almost like Cloud hitting another inflection point um with application and open source growth significantly at the app layer continue to put a lot of pressure and innovation in the infrastructure side so the question is for you guys each to answer is what's the same and what's different in today's market so it's kind of like we want more of the same here but also things have changed radically and better here what are the what's what's changed for better and where what's still the same kind of thing hanging around that people are focused on can you share your perspective I'll I'll tackle it um you know uh businesses are complex and they're often unique uh that that's the same uh what's changed is how fast you can innovate the ability to combine manage services and new Innovative services and build new applications is so much faster today leveraging world-class Hardware uh that you don't have to worry about that's elastic you could not do that even five ten years ago to the degree you can today especially with the Innovation so Innovation is accelerating uh at a rate that most people can't even comprehend and understand the the set of services that are available to them it's really fascinating to see what a one pizza team of of Engineers can go actually develop in a week it is phenomenal so super excited about this space and it's only going to continue to accelerate that that's my take there I am you got a lot of platform to compete on with Amazon I got a lot to build on the memory which then you're right on your side what's your what's your answer to that question I think we're seeing a lot of innovation with new applications that customers [Music] I think uh what we see is this whole notion of how do you go from desktop to production to the secure supply chain and how can we truly uh you know build on the agility that developers desire and build all the security and the pipelines to energize that motor production quickly and efficiently I think we are seeing uh you know we're at the very start of that sort of uh of Journey um of course we have invested in kubernetes means to an end but it's so much more Beyond that's happening in the industry and I think we're at the very very beginning of this Transformations Enterprise transformation that many of our customers are going through and we're inherently part of it yeah well gentlemen I really appreciate that we're seeing the same things more the same here on you know solving these complexities with abstractions whether it's you know higher level services with large-scale infrastructure um at your fingertips infrastructure is code infrastructure to be provisioned serverless all the good stuff happening Fred with AWS on your side and we're seeing customers resonate with this idea of being an operator again being a cloud operator and developer so the developer Ops is kind of devops is kind of changing too so all for the better thank you for spending the time we're seeing again that traction with the VMware customer base and it was getting getting along great together so thanks for sharing your perspectives they appreciate it thank you so much okay thank you John okay this is thecube and AWS VMware showcase accelerating business transformation VMware Cloud on AWS jointly engineered solution bringing Innovation to the VMware customer base going to the cloud and Beyond I'm John Furrier your host thanks for watching [Music]

>> Well, hello everybody, John Walls here on theCUBE and continuing our coverage. So splunk.com for 21, you know, we talk about big data these days, you realize the importance of speed, right? We all get that, but certainly Formula One Racing understands speed and big data, a really neat marriage there. And with us to talk about that is James Hodge, who was the global vice president and chief strategy officer international at Splunk. James, good to see it today. Thanks for joining us here on theCUBE. >> Thank you, John. Thank you for having me and yeah, the speed of McLaren. Like I'm, I'm all for it today. >> Absolutely. And I find it interesting too, that, that you were telling me before we started the interview that you've been in Splunk going on nine years now. And you remember being at splunk.com, you know, back in the past other years and watching theCUBE and here you are! you made it. >> I know, I think it's incredible. I love watching you guys every single year and kind of the talk that guests. And then more importantly, like it reminds me of conf for every time we see theCUBE, no matter where you are, it reminds me of like this magical week there's dot com for us. >> Well, excellent. I'm glad that we could be a part of it at once again and glad you're a part of it here on theCUBE. Let's talk about McLaren now and the partnership, obviously on the racing side and the e-sports side, which is certainly growing in popularity and in demand. So just first off characterize for our audience, that relationship between Splunk and McLaren. >> Well, so we started the relationship almost two years ago. And for us it was McLaren as a brand. If you think about where they were, they recently, I think it's September a Monza. They got a victory P1 and P2. It was over 3200 days since their last victory. So that's a long time to wait. I think of that. There's 3000 days of continual business transformation, trying to get them back up to the grid. And what we found was that ethos, the drive to digital the, the way they're completely changing things, bringing in kind of fluid dynamics, getting people behind the common purpose that really seem to fit the Splunk culture, what we're trying to do and putting data at the heart of things. So kind of Formula One and McLaren, it felt a really natural place to be. And we haven't really looked back since we started at that partnership. It's been a really exciting last kind of 18 months, two years. >> Well, talk a little bit about, about the application here a little bit in terms of data cars, the, the Formula One cars, the F1 cars, they've got hundreds of sensors on them. They're getting, you know, hundreds of thousands or a hundred thousand data points almost instantly, right? I mean, there's this constant processing. So what are those inputs basically? And then how has McLaren putting them to use, and then ultimately, how is Splunk delivering on that from McLaren? >> So I learned quite a lot, you know, I'm, I'm, I been a childhood Formula One fan, and I've learned so much more about F1 over the last kind of couple of years. So it actually starts with the car going out on the track, but anyone that works in the IT function, the car can not go out on track and less monitoring from the car actually is being received by the garage. It's seen as mission critical safety critical. So IT, when you see a car out and you see the race engineer, but that thumbs up the mechanical, the thumbs up IT, get their vote and get to put the thumbs up before the car goes out on track there around about 300 sensors on the car in practice. And there were two sites that run about 120 on race day that gets streamed on a two by two megabits per second, back to the FIA, the regulating body, and then gets streams to the, the garage where they have a 32 unit rack near two of them that have all of their it equipment take that data. They then stream it over the internet over the cloud, back to the technology center in working where 32 race engineers sit in calm conditions to be able to go and start to make decisions on when the car should pit what their strategy should be like to then relate that back to the track side. So you think about that data journey alone, that is way more complicated and what you see on TV, you know, the, the race energy on the pit wall and the driver going around at 300 kilometers an hour. When we look at what Splunk is doing is making sure that is resilient. You know, is the data coming off the car? Is it actually starting to hit the garage when it hits that rack into the garage, other than streaming that back with the right latency back to the working technology center, they're making sure that all of the support decision-making tools there are available, and that's just what we do for them on race weekend. And I'll give you one kind of the more facts about the car. So you start the beginning of the season, they launched the car. The 80% of that car will be different by the end of the season. And so they're in a continual state of development, like constantly developing to do that. So they're moving much more to things like computational fluid dynamics applications before the move to wind tunnel that relies on digital infrastructure to be able to go and accelerate that journey and be able to go make those assumptions. That's a Splunk is becoming the kind of underpinning of to making sure those mission critical applications and systems are online. And that's kind of just scratching the surface of kind of the journey with McLaren. >> Yeah. So, so what would be an example then maybe on race day, what's a stake race day of an input that comes in and then mission control, which I find fascinating, right? You've got 32 different individuals processing this input and then feeding their, their insights back. Right. And so adjustments are being made on the fly very much all data-driven what would be an example of, of an actual application of some information that came in that was quickly, you know, recorded, noted, and then acted upon that then resulted in an improved performance? >> Well, the most important one is pit stop strategy. It can be very difficult to overtake on track. So starting to look at when other teams go into the pit lane and when they come out of the, the pit lane is incredibly important because it gives you a choice. Do you stay also in your current set of tires and hope to kind of get through that team and kind of overtake them, or do you start to go into the pits and get your fresh sets of tires to try and take a different strategy? There are three people in mission control that have full authority to go and make a Pit lane call. And I think like the thing that really resonated for me from learning about McLaren, the technology is amazing, but it's the organizational constructs on how they turn data into an action is really important. People with the right knowledge and access to the data, have the authority to make a call. It's not the team principle, it's not the person on the pit wall is the person with the most amount of knowledge is authorized and kind of, it's an open kind of forum to go and make those decisions. If you see something wrong, you are just as likely to be able to put your hand up and say, something's wrong here. This is my, my decision than anyone else. And so when we think about all these organizations that are trying to transform the business, we can learn a lot from Formula One on how we delegate authority and just think of like technology and data as the beginning of that journey. It's the people in process that F1 is so well. >> We're talking a lot about racing, but of course, McLaren is also getting involved in e-sports. And so people like you like me, we can have that simulated experience to gaming. And I know that Splunk has, is migrating with McLaren in that regard. Right. You know, you're partnering up. So maybe if you could share a little bit more about that, about how you're teaming up with McLaren on the e-sports side, which I'm sure anybody watching this realizes there's a, quite a big market opportunity there right now. >> It's a huge market opportunity is we got McLaren racing has, you know, Formula One, IndyCar and now extreme E and then they have the other branch, which is e-sports so gaming. And one of the things that, you know, you look at gaming, you know, we were talking earlier about Ted Lasso and, you know, the go to the amazing game of football or soccer, depending on kind of what side of the Atlantic you're on. I can go and play something like FIFA, you know, the football game. I can be amazing at that. I have in reality, you know, in real life I have two left feet. I am never going to be good at football however, what we find with e-sports is it makes gaming and racing accessible. I can go and drive the same circuits as Lando Norris and Daniel Ricardo, and I can improve. And I can learn like use data to start to discover different ways. And it's an incredibly expanding exploding industry. And what McLaren have done is they've said, actually, we're going to make a professional racing team, an e-sports team called the McLaren Shadow team. They have this huge competition called the Logitech KeyShot challenge. And when we looked at that, we sort of lost the similarities in what we're trying to achieve. We are quite often starting to merge the physical world and the digital world with our customers. And this was an amazing opportunity to start to do that with the McLaren team. >> So you're creating this really dynamic racing experience, right? That, that, that gives people like me, or like our viewers, the opportunity to get even a better feel for, for the decision-making and the responsiveness of the cars and all that. So again, data, where does that come into play there? Now, What, what kind of inputs are you getting from me as a driver then as an amateur driver? And, and how has that then I guess, how does it express in the game or expressed in, in terms of what's ahead of me to come in a game? >> So actually there are more data points that come out of the F1 2021 Codemasters game than there are in Formula One car, you get a constant stream. So the, the game will actually stream out real telemetry. So I can actually tell your tire pressures from all of your tires. I can see the lateral G-Force longitudinal. G-Force more importantly for probably amateur drivers like you and I, we can see is the tire on asphalt, or is it maybe on graphs? We can actually look at your exact position on track, how much accelerator, you know, steering lock. So we can see everything about that. And that gets pumped out in real time, up to 60 Hertz. So a phenomenal amount of information, what we, when we started the relationship with McLaren, Formula One super excited or about to go racing. And then at Melbourne, there's that iconic moment where one of the McLaren team tested positive and they withdrew from the race. And what we found was, you know, COVID was starting and the Formula One season was put on hold. The FIA created this season and called i can't remember the exact name of it, but basically a replica e-sports gaming F1 series. We're using the game. Some of the real drivers like Lando, heavy gamer was playing in the game and they'd run that the same as race weekends. They brought celebrity drivers in there. And I think my most surreal zoom call I ever was on was with Lando Norris and Pierre Patrick Aubameyang, who was who's the arsenal football captain, who was the guest driver in the series to drive around Monaco and Randy, the head of race strategy as McLaren, trying to coach him on how to go drive the car, what we ended up with data telemetry coming from Splunk. And so Randy could look out here when he pressing the accelerator and the brake pedal. And what was really interesting was Lando was watching how he was entering corners on the video feed and intuitively kind of coming to the same conclusions as Randy. So kind of, you could see that race to intuition versus the real stats, and it was just incredible experience. And it really shows you, you know, racing, you've got that blurring of the physical and the virtual that it's going to be bigger and bigger and bigger. >> So to hear it here, as I understand what you were just saying now, the e-sports racing team actually has more data to adjust its performance and to modify its behaviors, then the real racing team does. Yep. >> Yeah, it completely does. So what we want to be able to do is turn that into action. So how do you do the right car setup? How do you go and do the right practice laps actually have really good practice driver selection. And I think we're just starting to scratch the surface of what really could be done. And the amazing part about this is now think of it more like a digital twin, what we learn on e-sports we can actually say we've learned something really interesting here, and then maybe a low, you know, if we get something wrong, it may be doesn't matter quite as much as maybe getting an analytics wrong on race weekend. >> Right. >> So we can actually start to look and improve through digital and then start to move that support. That's over to kind of race weekend analytics and supporting the team. >> If I could, you know, maybe pun intended here, shift gears a little bit before we run out of time. I mean, you're, you're involved on the business side, you know, you've got, you know, you're in the middle east Africa, right? You've got, you know, quite an international portfolio on your plate. Now let's talk about just some of the data trends there for our viewers here in the U S who maybe aren't as familiar with what's going on overseas, just in terms of, especially post COVID, you know, what, what concerns there are, or, or what direction you're trying to get your clients to, to be taking in terms of getting back to work in terms of, you know, looking at their workforce opportunities and strengths and all those kinds of things. >> I think we've seen a massive shift. I think we've seen that people it's not good enough just to be storing data its how do you go and utilize that data to go and drive your business forwards I think a couple of key terms we're going to see more and more over the next few years is operational resilience and business agility. And I'd make the assertion that operational resilience is the foundation for the business agility. And we can dive into that in a second, but what we're seeing take the Netherlands. For example, we run a survey last year and we found that 87% of the respondents had created new functions to do with data machine learning and AI, as all they're trying to do is go and get more timely data to front line staff to go. And next that the transformation, because what we've really seen through COVID is everything is possible to be digitized and we can experiment and get to market faster. And I think we've just seen in European markets, definitely in Asia Pacific is that the kind of brand loyalty is potentially waning, but what's the kind of loyalty is just to an experience, you know, take a ride hailing app. You know, I get to an airport, I try one ride hailing app. It tells me it's going to be 20 minutes before a taxi arrives. I'm going to go straight to the next app to go and stare. They can do it faster. I want the experience. I don't necessarily want the brand. And we're find that the digital experience by putting data, the forefront of that is really accelerating and actually really encouraging, you know, France, Germany are actually ahead of UK. Let's look, listen, their attitudes and adoption to data. And for our American audience and America, America is more likely, I think it's 72% more likely to have a chief innovation officer than the rest of the world. I think I'm about 64% in EMEA. So America, you are still slightly ahead of us in terms of kind of bringing some of that innovation that. >> I imagine that gap is going to be shrinking though I would think. >> It is massively shrinking. >> So before we, we, we, we are just a little tight on time, but I want to hear about operational resilience and, and just your, your thought that definition, you know, define that for me a little bit, you know, put a little more meat on that bone, if you would, and talk about why, you know, what that is in, in your thinking today and then why that is so important. >> So I think inputting in, in racing, you know, operational resilience is being able to send some response to what is happening around you with people processing technology, to be able to baseline what your processes are and the services you're providing, and be able to understand when something is not performing as it should be, what we're seeing. Things like European Union, in financial services, or at the digital operational resilience act is starting to mandate that businesses have to be operational in resilient service, monitoring fraud, cyber security, and customer experience. And what we see is really operational resilience is the amount of change that can be absorbed before opportunities become risk. So having a stable foundation of operational resilience allows me to become a more agile business because I know my foundation and people can then move and adjust quickly because I have the awareness of my environment and I have the ability to appropriately react to my environment because I've thought about becoming a resilient business with my digital infrastructure is a theme. I think we're going to see in supply chain coming very soon and across all other industries, as we realize digital is our business. Nowadays. >> What's an exciting world. Isn't it, James? That you're, that you're working in right now. >> Oh, I, I love it. You know, you said, you know, eight and an eight and a half years, nine years at Splunk, I'm still smiling. You know, it is like being at the forefront of this diesel wave and being able to help people make action from that. It's an incredible place to be. I, is liberating and yeah, I can't even begin to imagine what's, you know, the opportunities are over the next few years as the world continually evolves. >> Well, every day is a school day, right? >> It is my favorite phrase >> I knew that. >> And it is, James Hodge. Thanks for joining us on theCUBE. Glad to have you on finally, after being on the other side of the camera, it's great to have you on this side. So thanks for making that transition for us. >> Thank you, John. You bet James Hodge joining us here on the cube coverage of splunk.com 21, talking about McLaren racing team speed and Splunk.

(upbeat music) >> theCUBE's back on day three here in Cloud City Mobile World Congress. This is where all the action is, and this is theCUBE set. I'm John Furrier with Dave Vellante. We're here with DR, Danielle Royston, who is the CEO of TelcoDR, as well as the CEO of Totogi. Great to see you again. >> Hey. >> Hey, how are you guys? >> Good. >> Great time, great boat last night, good industry executives. A lot of intimate high player, big players here in the industry, even though not a lot of attendance, but the right people are here and events are back. >> Yeah. Yeah. I think, MWC was the first event to cancel with COVID in February, end of February 2020. So first big event to come back. It's such a nice symmetry. Yeah. Typically you have big delegations, hundreds of people from the big groups coming to the show. We're seeing the executives are coming, smaller delegations, but they're all in the booth and that we're having great conversations and it's awesome. >> Yeah, and the thing I will say is that theCUBE's back too. We'd like them to be, be in here in the action, because one of the things that's happened with this hybrid events is that people are watching. And so there's a virtual space and the physical space and Cloud City has built out paradise. It's beautiful and spectacular behind us. If you look around, for the people who can't see, it's really made for the combination of on-site and virtual experience, the content, the people, Bon Jovi last night, it's just the top of Mobile World Congress and it's translating to the industry. This has been amazing. So congratulations. >> Thank you so much. >> Well. I got to say, you have a lot to say as we all know. >> Danielle: Yeah. >> But I think it was easy for the big guys. >> Danielle: Can't shut me up. (laughing) >> That's why we love you in theCUBE. But I think it was easy for the big guys to tap out and say, hey, we can save a bunch more money. >> Danielle: Yeah. >> We don't really have much to talk about. We're going to talk about it again. Hey, let's talk about 5G. >> Yeah, yeah, exactly. >> 5G's coming. >> It's the revolution. >> And I told you about 5G though. >> Whereas the narrative here is all about the future. And it's not about the future of blah blah blah, it's about the future of, this is the journey that we're taking and here's where it's starting and with the meat in the bone. >> Yeah. And I think what's really interesting about Cloud City is the fact that we've brought these different players together that are all focused, as you said, on the future. And I'm starting to see these connections where they're collaborating. Vendors that didn't know each other probably would never have partnered before. Totally different areas. I'm hearing the conversation in the booth about like, hey, I talked to P1 security, or I went and talked to LMX and we're putting deals together 'cause we're complimentary. And it's amazing and so that's really good. >> And the integration partnership, heard that from Google yesterday on our news exclusive break in there. They see integration and they're talking about Android, with what Android did for mobile. They're seeing a whole new software paradigm coming into telco. Its partnership, its ecosystem and open. These are new kind of dynamics. >> And I think for you guys, when you say integration and open, I think those things are really paired and they're important. A lot of times Telco people will hear integration, and they'll think customization. Coding it up and customizing it so that they talk to each other. But I think the open part of that is really important where we're connecting via APIs. And I think that's bringing the hyperscalers. That's what they do. They provide these systems and the software that's all API based and you can use it very quickly and you can unravel it if you need to. And it's that feature velocity, we talked about a couple days ago. >> And automation is the underpinning. >> Yeah, yeah. >> I mean, that's really the theme, right? >> Right. >> It's not like a one-off hardcore custom integration that's going to be frozen. >> One time to upgrade it every 18 months or whatever it is. Yeah, it's a life. >> Dave: How about Musk yesterday? >> John: I mean, he's always a crowd pleaser. First of all, my kids love him. He's crazy. >> Who doesn't love Elon Musk? >> I mean, he is amazing. He's a builder and he takes no prisoners. He's just, you know what, my goal was not to go bankrupt. That's what he said a couple of years ago. >> Dave: Which was brilliant because everybody's gone bankrupt in that business and he's just close it off. >> And he's just like, look, we're here, we're just going to chip away at it and we're just going to keep striving, not making up excuses. He takes the failures. He takes the phase plans. He gets back up and he keeps going. He's focused on building. >> He's focused on one thing. He's not focused on everything. He's focused on getting to Mars. And I think that's what I like to compare myself to Elon Musk. Not that I'm building rockets or getting to Mars, but that the hard problem that I'm solving is getting Telco to the public cloud and that's going to take a decade. It might have been accelerated because of COVID, it might've taken 20 years and now it might take 10. But you look at what he does, and that guy, he has haters on Twitter that are pew- pew. Always like, throw in their bars, but he's like, I got my rocket company. I got my communication and space company. We're going to need the bore holes, the Boring Company. I need batteries, I got my Tesla company. And so this guy focuses. >> He's got some haters, but he's got a lot more lovers on his other side because people might not know this, but he fired the entire PR department because he's like, I don't need PR. I'm just going to go do my own, his own PR. >> Obviously, the crypto stuff's always fun. Doge coins, always a laugh. >> Danielle: I think he just plays around with that. >> And it's just more of like playing. >> Yeah, that's a watch this. >> He just likes to see what he can do. >> Doge coins app. That Saturday Night Live was an interesting thing he did, but I think he illustrates the point of a new generation. And I think my young kids, not young, they're in their twenties now. They look at him and they say, that's aspirational because he's building and he's focused on that one thing. And again, the growth that you mentioned Telco to the cloud, getting back to that is that, I want to ask you this growth question. It used to be like, okay, growth was there, people expanded cell towers, networks were networks. Now it seems that the growth of Telco, with Telco is going into, with the edge and all the open-RAN stuff, which means we need more infrastructure. >> Danielle: Yeah. >> We need more stuff. There's more needed and there's growth behind them. What's your reaction? >> I think we need more software. Software eats the world. And it's, I mean, there's a lot of hardware to chomp in Telco and it's just going to keep eating it and that's just going to accelerate. I think that's where Telco needs to start to build that muscle. They don't have great software capability. They don't have public cloud building capability. And so that's a big up-skilling. That's a new hiring. And I think it's an executive conversation. It's not just an IT thing or just a marketing thing or networking thing. >> I got to chime in here for a second because there are a lot of parallels with how the data center transition has occurred. And what's happening here. We talk about all the time. It was a mainframe, et cetera. There are parallels. >> Danielle: Yeah, yeah. >> And what happened when the data center went to software-defined a whole bunch of hardware was allocated to run all the software-defined stuff. It wasn't built for that. >> Danielle: Yeah. >> But the cloud, what you guys are doing with Totogi and taking advantage of AWS's is Nitro and Graviton. That's built to be software-defined. >> Correct. >> And so the Telcos are going to go through the same thing. If they just virtualize, they're going to say, oh wow, we're wasting 30% of our power, our compute power on just supporting all this software-defined stuff, because it wasn't built for that, but the cloud is built for that. >> Danielle: Yeah. >> And that is going to be a huge difference. >> And I keep trying to make this distinction. And I think people in Telco still don't get this about the public cloud. They think of it as a place. It's a place to run a workload. And that tells me, they think of it as infrastructure. They think of it as servers still like, well, I'm going to run into my closet or AWS's closet. I'm like, and I was just having a conversation about this with this senior person from GSMA. I'm like, it's actually about the software that's there. It's about the databases they're building and the analytics and the AI and the ML but they let you buy by the minutes or by the API call. And that is my, like you need to think about that because it's mind-blowing. It's a totally different way to think. >> And you're totally right. I'm just going to, again, give you props on this. I've had many one-on-one with Andy Jassy for the past seven years for exclusives, but over the years it's been consistent. Each platform lifting and shift wasn't the end game. Okay. Replatforming in the cloud, certainly a great advantage, a great starting point. It was the refactoring. And that's why you see Amazon Web Services, for instance, keep adding more services 'cause that's the model. >> Danielle: Yeah. >> They keep offering more goodness so that the businesses could refactor, not just replatform. >> Danielle: Yeah. >> And that's what you're getting at. I think with the AI and machine learning, where you start getting into these new use cases, but why I couldn't do that before. >> Danielle: Right, right. >> This is going to be a huge game changer. >> Well, Forrest Brazeal. A great guy, a cloud guru wrote a great blog called a lift-and-shift is a ticking time bomb. And it's a great start to get your stuff over there. It forces your team to start to interact with like an AWS or GCP in a real way. Like now they, they got to use it. You take it away and I'm like, but once you move it, you got to re-factor. You got to rewrite. And then that's why it's a ticking time bomb. You got to get, move it over and get going. >> Danielle Royston, DR, Digital Revolution of you are one. You got it here, Telco DR. And this has been a great experience for theCUBE, as we get back to business with real life events and virtual. For the folks who couldn't make it here, Barcelona is still a great city. Obviously a great place to come and the events will be back. They'll be hybrid. They'll be different. Certainly, theCUBE will wait double them down, but, we've got a great video. I want to share for the group, the Barcelona and Cloud City. This is a montage of what it's like here and a little experiential video. So take it away and run that video. (upbeat techno music) >> Hi, I'm Katie Goldfinch, here in Barcelona for an action packed Day Two at TelcoDR's Cloud City. This morning, the focus was firmly on DR. and her MWC keynote, which told Telco execs in no uncertain terms that now is the time to act on embracing public cloud. Back in Cloud City content ruled the day with both theCUBE and Cloud City live stages, hosting public cloud, thought-leaders covering a wide range of topics to educate and inspire attendees. And in the beautiful space of Cloud City, the excitement grew throughout the day as we streamed MWC's exclusive keynotes from Elon Musk and preparations got underway for tonight's star performer, Jon Bon Jovi. (upbeat techno music) Wow! What an amazing day from groundbreaking keynotes into space and back to a star studded performance. Don't forget, you can catch up on anything you missed and join us for the rest of the week at cloudcity.telcodr.com or following #cloudcity. (upbeat techno music) >> Okay, we're back. That was great look at what's going on here in Cloud City. This next video, DR, you're going to love this. Your keynote highlights and some Bon Jovi highlights, which by the way, was the most epic thing. People were packed. >> Dave: It was exciting. >> Place was packed. It had the security clicking people, counting all the people, people are standing back. All the people from their booths are all coming in to watch. >> Dave: He was pumped. >> Let's take a look at this awesome highlight video from yesterday. (upbeat techno music) (upbeat techno music) >> Okay, we're back at theCUBE. Dave, that was a highlight reel yesterday. DR has got some action on stage, great messaging, revolution, digital revolution. >> You know your comment about how you think like Elon Musk. That's an inspiration from it. I mean, what a lot of people don't know is when you look at autonomous vehicles, remember you're driving down Palo Alto, you see one of those lidar things. He's doing away with lidars, it's too expensive. It's $7,000. He's taking it with cheap cameras and software down to a couple of hundred bucks per vehicle. >> Danielle: Wow. >> That's the way he thinks. And you're doing the same thing to Telco. >> Danielle: I am. I am I'm trying to change Telco. I mean, he's changing the world. He might be one of the most important humans on Earth right now. I don't think I'm exactly that level, but I'm trying to become a really important person in Telco. We have this great message. I think it's going to help Telcos to get better businesses. And I think it's a great idea. >> For the folks out there watching, what is that big change? If you're going to drive down this Cloud City street, main street of Cloud City and just all about Cloud. Because public clouds here, it's going to become hybrid, dynamics, operating models are changing. What is the key message that you'd like to send? >> I think all of the software in Telco needs to be rewritten. And that's how many millions of lines of code is that? And it's going to be shrunk down and put out on public cloud and rewritten using the software Legos of the public cloud. That is a big undertaking. No one's working on it. I'm working on it. I'm doing it. Let's go do it. >> Let's do it. And if you look out a couple of years, what would be a successful, what does checkmate look like in this chess game? >> I'm winning? #winning >> You're opening move is pretty good as we say in chess. >> I mean, I think it, it takes, again, it takes singular focus like Elon Musk on Mars. Someone needs to singularly focus on getting the public cloud and you can't sit there and protect your old business models, your CR revenue, if you're Amdocs. Give that up. When they start to give up their CR revenue to focus on public cloud, then they'll be, okay, there's a worthy adversary out there really focusing on it. >> I mean the late Clayton Christensen had all the same things. Innovator's dilemma. You get stuck here, what do you do? >> Danielle: What do you do? >> You kill your own, you eat your own to bring in the new, I mean, all these things are going on. This is a huge test. >> And to be willing to burn some boats. >> I think it's transparency, simplicity, and the consumer saying, hey, this is a great experience. That's the Tel sign. >> Danielle: Yeah. >> And that's what we're going to see over this next decade. >> Plus consumers love their Telco. I can't wait for that. I want to love my Telco. >> Dave: Like you love Netflix. >> Yes, exactly. >> DR, we love you because you've got a bold vision. You're putting it out there and you're driving it. You're walking the talk. Congratulations. And again, Cloud City's a home run. >> Awesome. >> Great success. Thanks for having theCUBE. >> Thank you guys. As always super fun. Great day. >> Okay. >> CUBE's coverage here. And remember, we're here getting all the action and it's all going to go online after a synchronous consumption. But right now, it's all about Mobile World Congress and Cloud City. This is the action. And of course, Adam in Cloud City Studio is waiting for us and he's going to take it from here.

(upbeat electronic music) >> Okay thanks, Adam, and the studio. We're here on the floor in Cloud City, right in the middle of all the action, the keynotes are going on in the background. It's a packed house. I'm John Furrier. Dave Vellante's on assignment, digging in, getting those stories. He'll have the analysis, he'll be back on theCUBE, but I want to welcome Chloe Richardson, who has been holding down the main stage here in Cloud City with amazing content that she's been hosting. Chloe, great to see you. Thanks for coming on theCUBE, and kicking it off day two with me. >> No, not at all. Thank you for having me! It's very exciting! I love what you guys have got over here, very fun! >> We're inside theCUBE. This is where all the action is, and also, Cloud City is really changing the game. If you look at what's going on here in Cloud City, it's pretty spectacular. >> No, I mean, the atmosphere is absolutely palpable. Isn't it? You can just feel it. People walk in and see what the future looks like for the telecoms industry. Very exciting. >> And you've been doing a great job on the main stage, we're really loving your content. Let's get into some of the content here. After the keynotes are going on, we're going to have DR maybe fly by the set later, we're going to check that out. But let's check out this videotape. This is TelcoDR. You got to check out this reel, and we'll be right back, and we'll talk about it. (smooth electronic music) >> TelcoDR burst onto the global telecom scene this year, making headlines for taking over the huge Erickson space at MWC 21, and for building Cloud City in just a hundred days. But why did the company go to such trouble? And what is their unique offering to the telecoms industry? And what drives their dynamic CEO, Danielle Royston, or DR, as everyone calls her? Cloud City Live caught up with DR, away from the hustle and bustle of the city to find out. (upbeat instrumental music) >> Hi, I'm Danielle Royston, coming to you from beautiful Barcelona! I'm here for MWC 21. About a hundred days ago, I decided to take over the iconic Erickson booth to turn it into Cloud City. Cloud City has over 30 vendors, and 70 demos, to introduce telco to what I think is the future for our industry. We're going to have three awesome experiences. We're going to talk about the new subscriber experience. We're going to talk about what's in store for the new network, and the future of work. And I'm really excited to create a community, and invite awesome telco executives to see this new feature. It's been a really tough 18 months, and we didn't know what MWC 21 was going to be like in terms of attendance. And so from the get-go, we planned this amazing experience that we call Cloud City Live. At Cloud City Live, we have two main components. We have the speaker series, where we have over 50 speakers from Amazon, Google, Microsoft, as well as CSPs, and awesome vendors, talking about the public cloud in telco. The second part of Cloud City Live is theCUBE. Think of this as like an ESPN desk of awesome tech interviews focused on telco and the public cloud, hosted by John furrier and Dave Vallente. Dave and John are going to talk to a variety of guests focused on telco in the public cloud. It's a great way for our virtual participants to feel like they're at the show, experiencing what's going on here. So excited to have them as part of the Cloud City booth. There's a ton of innovation going on in telco, and 20 years ago, Elon Musk set on his mission to Mars. I, like Elon Musk, am on a quest to take telco to the public cloud. Every year at MWC, there's always a flurry of announcements, and this year is no different. At this year's MWC, Totogi, a startup that I invested $1,000,000 in, will be launching. Totogi is introducing two products to the market this week at MWC. The first is at planetary scale charger. More than a charger, it's an engagement, coupling your network data with charging information to drive subscriber engagement, and doubling your ARPU. The second product that Totogi is introducing is a planetary scale BSS system, built on top of the TM Forum Open APIs. Both of these products will be available for viewing in the virtual booth, as well as on the show floor. The public cloud is an unstoppable mega trend that's coming to telco! I'm super excited to bring to you the vendors, the products, the demonstrations, and the speakers, both to people here in Barcelona, and virtually around the world! (upbeat instrumental music) Well, that was a fascinating insight into the origins of TelcoDR, why public cloud is going to truly disrupt the telecoms industry, and why DR herself is so passionate about it. If you'd like to find out more, come and see us at Cloud City. (groovy electronic music) >> Okay, thanks. Just rolling that reel. Chloe, I mean, look at that reel, I mean, DR, Danielle Royston, she's a star. And I've seen a lot of power players in the industry. She's got guts and determination, and she's got a vision, and she's not just, you know, making noise about telco and cloud, there's actually a lot of real good vision there! I mean, it's just so impressive. >> No, it really is. And for me, it's almost like the next moonshot. It's the moonshot of the telco world! She's innovative, she's exciting. And if we've learned anything over the last 18 months, it's that we need that in this industry, to grow for the future of the industry. So, so exciting. I think she's a real inspiration! >> And I love the fact that she's so takes the tiger by the tail. Because the telco industry is being disrupted, she's just driving the bus here. And I remember, I did a story on Teresa Carlson, who was with Amazon Web Services, she was running the public sector, and she was doing the same exact thing in that public sector world in DC, and around the world. She opened up regions in Bahrain, which as a woman, that was an amazing accomplishment. And she wasn't just a woman, she was just a power player! And she was an exceptional leader. I see DR doing the same thing, and people aren't going to like that, I'll tell you right now. People are going to be like, "Whoa, what's going on here?" >> Now of course, it's always that way we pioneers though, isn't it? At the time, people thinking what is going on here, we don't like change, why are being shaken up? But actually, afterwards, in retrospect, they think, "Oh, okay. I see why that happened, and we needed it." So, really exciting stuff. >> Making things happen, that's what we're doing here on theCUBE. Obviously, the main stage's doing a great job. Let's go check out this highlight reel. If you're watching and you missed some of the action, this is obviously the physical event back since 2019 in February, but there's also a hybrid event, a lot of virtual action going on. So, you got theCUBE Virtual, you got a lot of content on virtual sites. But in person here, we're going to go show you a highlight reel from what we did yesterday, and what was happening around the show. Enjoy this quick highlight reel from yesterday. (groovy electronic music) (cheerful instrumental music) (groovy electronic music) Okay. We're back here in theCUBE. We're on the main floor out here with Chloe, who is emceeing, hosting, and driving the content on the Cloud City main stage. Chloe, it's been great here. I mean so far, day one, I was watching your presentations and fireside chats you've been hosting. Awesome content. I mean, people are like jazzed up. >> Yeah, no, for sure. We had Scott Brighton on yesterday, who was our opening keynote on the live stage, and his session was all about the future of work, which is so relevant and so pertinent to now. And he talked about the way it's changing. And in 10 years, it's going to be a trillion dollar industry to be in the cloud at work. So, really interesting! I mean, yeah, the atmosphere here is great. Everyone's excited. It's new content everyday. And that's the thing, it's not stale content! It's stuff that people want to hear. People are here for the new hot trends, the new hot topics. It's very exciting. >> Yeah, the next big thing. And also it's a fiscal event, so since 2019, this Mobile World Congress has been a massive event, and hasn't happened since February, 2019. That's a lot of time that's elapsed in the industry because of COVID, and people are glad to be here. But a lot of stuff's changed! >> Yeah. It's a different world, right? I mean, two years in the telco industry is like a hundred years elsewhere. Everything has changed! Digital transformation migration, obviously cloud, which is what we're talking about over here at Cloud City Live. I'm wondering though, John, I'd like to pick your brains on something. >> John: Sure. >> It has changed in the last two years. We know that! But what about the future of Mobile World Congress? How do you see it changing in the next few years. >> Oh, man. That's a great question. I mean, my observation, I've been coming to the show for a very long time, over a decade and a half, and it's been a nerdy show about networks, and telecom, which is basically radios, and wireless, and then mobile. But it's very global, a lot of networks. But now it's evolving! And many people are saying, and we were talking on theCUBE yesterday, Dave Vellante was commenting, that this show is turning into a consumer like show. So CES is the big consumer electronics show in the US, in Las Vegas every year. This show has got a vibe, because of all the technology from the cloud players, and from the chips, getting smaller, faster, cheaper, more capability, lower power. So people look at the chips, the hardware. It's less about the speeds and feeds, it's more about the consumer experience. We got cars. I was talking to a guy yesterday, he said, "Vehicle e-commerce is coming." I went, "What the hell his vehicle e-commerce?" And you could be on your app driving down the freeway and go, "Hey, I want some food." Instead of having it delivered to you, you order it, you pick it up. So that's kind of what can be happening now in real time, you can do all kinds of other things. So, a lot of new things are happening. >> Yeah, I think so. Do you see that as another disruption for the industry? That is, the fact that it's moving to be more consumer focused? Is there anything we should be worried about in that space? >> Well, I think the incumbents are going to lose their positions. So I think in any new shift, new brands come in out of nowhere. And it's the people that you don't think about. It's the the company that you don't see. (audience in background applauding) And we got DR on the main stage right here, look at this! We saw her walk out with the confidence of a pro. >> Chloe: Yeah, for sure. >> She just walked out there, and she's not afraid. >> Well, as she said in her video, she is ready to wake them up! And you can see as soon as she walks out, that is what she intends to do today. >> I love her mojo. She's got a lot of energy. And back to the show, I mean, she's just an example of what I was saying. Like in every market shift, a new brand emerges. >> Chloe: Yep. >> I mean, even when Apple was tainted, they were about to shut down, they were going to run out of cash, when Steve Jobs brought back Apple, he consolidated and rebooted the company, the iPad was a seminal, iPod, a seminal moment. Then the iPhone, and just, the rest is history. That kind of disruption is coming. You're going to see that now. >> Oh, it's exciting though, isn't it? To be future ready, rather than future proof! But actually I wanted to ask you something as well, because we are seeing all these cloud players getting hot under the collar about telco. Why are they so excited? What's the buzz about wire, as you're on AWS and Google Cloud, why do they want to have a slice of the pie? >> Well, I think they're hot and heavy on the fact that telco is a ripe opportunity. And it used to be this boring, slow moving glacier. It's almost like global warming now, the icebergs are melting, and it's going to just change. And because of the edge, 5G is not a consumer wireless thing, it's not like a better phone. It's a commercial app opportunity, because it's high bandwidth. We've all been to concerts, or football games, or sporting events where a stadium is packed. Everyone gets bars on their wifi, but can't get out. Can't upload their picture to Instagram. Why? Because it's choking them on the network. That's where 5G solves a problem. It brings a lot of bandwidth, and that's going to bring the edge to life, and that's money. So when you got money, and greed, and power, changing hands, if it's on the table, and the wheel's spinning, it could be double zero, or it could be lucky seven. You don't know! >> Oh, for sure. And that's certainly enough to get all the big players hot and bothered about getting involved! And I suppose it circles back to the fact that DR is really leading the charge, and they're probably thinking, "Okay, what's going on here? This is different. We want something new." You did notice it, OpenRAN is something that we've been talking about over the last day or so. We've had quite a few of us speakers over here at Cloud City Live mention OpenRAN. What is it all about, Don? Because why all the buzz if 5G is such a hot topic? Why are we get excited about it? >> That's a great thing. The 5G certainly will drive the main trend, for sure. OpenRAN is essentially an answer to the fact that 5G is popular, and they need more infrastructure. So open source, the Linux Foundation, has been the driver for most of the open source software. So, they're trying to make open software, and open architectures, to create more entrepreneurial activity around hardware, and around infrastructure, because we need more infrastructure, we need more antennas, we need more transceivers, we need more devices. That could be open. So in order to do that, you got to open up the technology, and you want to minimize the licensing, and minimize a lot of these, you know, proprietary aspects. >> What did we look at? So on Wednesday, we've got a great keynote from Phillip Langlois, who is CEO and founder of P1 Security. And he's coming to talk to us about cybersecurity within the cloud, and within telco. So you just mentioned that OpenRAN is all about having open source, about having that space where we can share more efficiently and easily more easily. What does that mean for security though? Is it at risk? >> I think it's going to increase the value of security, and minimize the threats. Because open source, even though it's open, the more people that are working on it, the more secure it could be. So yes, it could be more open in a sense that could be explored by hackers, but open can also protect. And I think we've seen open source, and cloud in particular, be more secure. Because everyone said, cloud is not secure, open source is insecure. And as it turns out, when the collective hive minds of developers work on things, it gets secure. >> And it is interesting, isn't it? Because we have seen that there has been an uptick in cyber security threats, but actually I was speaking to some leaders across various industries, and particularly in tech, and they were saying, actually, there's not been an uptick in attempted threats, there's been an uptick because with this open-source environment, we are able to track them, and measure them, and defend more efficiently. So actually, they're being batted away. But the number is probably the same as it always was, we just didn't know about them before we had this open source environment. >> There's more money in threats, and there's more surface area. So as the tide rises, so to the threats. So on a net basis, it's more, because there's more volume, but it's pretty much the same. And look it, there's money involved, they are organized. There's a business model on attacking and getting the cash out of your bank, or ransomware is at an all time high. >> Yes! >> So this is like a big problem, and it's beyond the government. It's around individual freedom. So, security is huge. And I think open source and cloud are going to be, I think, the answer to that. >> Yeah, for sure. And it's, again, about collaboration, isn't it? Which we talk about all the time, but without collaboration, the industries are going to have to work together to promote this environment. So yeah, it should be good to talk with Phillip on Wednesday. >> I'd just say on security, don't download that PDF, if you don't know who it came from. The phishing is always good. Well, we got some great stuff coming up. We're going to have a great day. We got a video here of Mobile World Live. We're going to show this next segment, and we're going to toss it to a video. And this is really about to give the experience, Chloe, for people who aren't here. To get a feel for what's going on in Barcelona, and all the action. And if you look at the video, enjoy it. >> Hi, I'm Daniel Royston, CEO and founder of TelcoDR. But you can call me DR! Ready for some more straight talk about telco? It's go time! Let's do it. Holy shit! It sure is a great time to be a tech company! I mean, if you're Amazon, Microsoft, Google, Grab, Twilio, Door Dash, or Uber, life's pretty great! Just look at these stock prices over the past five years, with their shareholder value going up and to the right. Totally amazing! But where's telco? Dare I add our stocks to this awesome chart? Let's compare these fabulous tech stocks to AT&T, Vodafone, Telefonica, TIM, America Movil, and Zain Group. Huh. Not so great, right? Yep. I'm talking directly to you, senior telco execs. I'm here to wake you up! Why is it that Wall Street doesn't see you as tech? Why aren't CSPs seen as driving all the tech change? Why is it always Apple, Amazon and Google who get the big buzz? But more importantly, why isn't it you? Before I came to this industry, I always thought of carriers as tech companies. I gave more of my money to AT&T than to Apple, because I really cared about the quality of the network. But I also wondered why on earth the carriers allowed all the other tech companies to take center stage. After spending the last few years in telco, I now understand why. It's because you are network people, you are not customer people! I get it. You have the security blanket. You're a network oligopoly. It's crazy expensive to build a network, and it's expensive to buy spectrum. It takes operational chops to run a killer network, and it takes great skill to convince Wall Street to finance all of it. You telco execs are amazing at all those things. But because you focus on the network, it means you don't focus on the customer. And so far, you haven't had to. Every Telco's KPI is to be less shitty than their next competitor. You don't have to be the best. Just don't be last. Everyone else's NPS is in the thirties too. Their mobile app ratings are just as terrible as yours. Everyone's sucks at customer sat. And it's widely acknowledged and accepted. Let's talk about the cost of that. The cost is not measured on market share against other MNOs. The cost is measured in lost ARPU that the tech guys are getting. Everyone knows about the loss of texting to WeChat, WhatsApp, and the other OTT apps. But it is not just texting. The total adjustable market, or TAM, of the mobile app disruptors is huge! Instead of remaining network focused, you should be leveraging your network into a premier position. And because you're network people, I bet you think I'm talking about coercive network leverage. That is not what I'm talking about! I'm talking about love, customer love. There is one thing the highly valued tech companies all have in common. They all crush it on customer love! They look at every interaction with the customer and say, how do we make the customer love this? Like Netflix has easy monthly cancellation, Amazon does no questions asked returns, Uber gives users a real time view into driver rating and availability. Compare those ideas to the standard telco customer interaction. The highly valued tech companies don't have the network oligopoly to fall back on like you do. To survive, they must make customers love them. So, they focus on it in a big way! And it pays off. Their NPS is close to 70, and they have app ratings of 4.5 or higher. A far cry from your thirties NPS, and app ratings of 3.5. If you want to have those huge tech multiples for yourself, you have to start thinking about these guys as your new competition, not the other telcos in your market. The crazy thing is, if you give up using your network as a crutch, and put all of your focus on the customer, the network becomes an asset worth more than all the super apps. Let's step back and talk about the value of super apps, and becoming customer centered! Retooling around the customer is a huge change, so let's make sure it's worth it. We aren't talking about 25% improvement. I'm going to show you that if you become customer centric, you can double your ARPU, double your valuation multiples, and drive big shareholder value, just like the tech companies on that chart! Now let's talk about the customer focused super apps. There are hundreds of companies in a variety of categories vying for your subscribers' disposable income. Movies, food delivery, financial services. Who are they? And why does Wall Street give them such high valuations and like them so much? Well first, look at what they are telling Wall Street about their TAM. They broadcast ridiculously huge TAMs that are greater than the telco TAMs. You know, who should have a ridiculously huge TAM? You! Hello? What I'm saying is that if you got what's yours, you double in size. And if you take the TAMs they throw around, you'd be five times as big. When I think about the opportunity to double ARPU, without having to double the cap ex to build out the network, I say to myself, hell yeah! We should totally go do it, and do whatever it takes to go get it. For example, let's talk about Grab. Grab is a Southeast Asian super app company with an expected $40 billion valuation. Grab's customer focus started in Rideshare, but then leveraged its customer love into wallet deliveries, hospitality, and investing. Their ARPU is now larger than a Telco's ARPU in countries where they compete, and they have a higher valuation than those telcos too. Imagine if you could combine a great user experience with the valuable services that helped grow your ARPU. That would be huge! So, how do you build a super app? I bet right about now, you're wishing you had a super app. Everyone wants a super app! A lot of money has been unsuccessfully spent by telcos trying to build their own. I bet you're saying to yourself, "DR, your pie in the sky sounds great, but it has no chance of success." Well, I'm betting things are about to change. There is a public cloud startup called to Totogi that is going to help carriers build world-class super apps. To have a successful super app, there is one key metric you need to know. It is the KPI that determines if your super app will be a success or a flop. It's not about the daily active users. It's not the average order value. It's not even gross merchandise value. It's all about the frequency of use per day by the user. That's the metric that matters. How many have you used that metric in your telco apps? Do you have a team driving up user app interactions every day? Most telco apps are used for top-up, or to check a bill. This is a huge missed opportunity. Super app companies excel at building great experiences and driving a huge amount of interactions. They have to, their business depends on it. They have to be customer focused. They have to keep bringing the user back to the app, every day, multiple times a day. And you know what? They do a great job. Customers love their super apps. They have great user experiences. Like Apple credit cards, no information required application process. They have high net promoter scores because of customer friendly policies. Like how Door Dash retroactively credits fees when you move to a better plan. And they have great app store ratings, because they do simple things, like remember your last order, or allow you to use the app, rather than forced you to call customer service. Customers of successful super apps love it when new services are added. And because of the customer love, every time something is added to the app, customers adopt it immediately. New services drive frequent daily user interactions. So our problem in telco is we have an app that is only open once per month, not multiple times per day. And without frequent opens, there is no super app. Hm, what do we have in telco that we could use to help with this problem? I wonder. While you don't currently have a mobile app that subscribers use multiple times a day, you have something that's 10 times better! You have a network. Subscribers already interact with your network. 10 times more frequently than any user with any of the super apps. But telcos don't leverage those interactions into the insanely valuable engagements they could be. Worse, even if you wanted to, your crappy, over customized, on-premise solutions, make it impossible. Thankfully, there's this new tech that's come around, you may have heard of it, the public cloud. When you bring the enabling technology of the public cloud, you can turn your network interactions into valuable super app interactions. And there's a special new startup that's going to help you do it, Totogi! Totogi will leverage all those network interactions, and turn them into valuable customer interactions. Let me repeat that. Totogi will leverage all those network interactions, and turn them into valuable customer interactions. Totogi allows the carrier to leverage its network, and all the network interactions, into customer engagement. This is something that super apps don't have, but will wish they did. But this magic technology is not enough. Telcos also need to move from being network focused to being customer focused. Totogi enables telcos to chase exciting revenue growth without that annoying, massive cap ex investment. Totogi is going to help you transform your sucky mobile apps, with the crappy customer ratings, into something your subscribers want to open multiple times a day, and become a platform for growth. I'm so excited about Totogi, I'm investing $100,000,000 into it. You heard me right. $100,000,000. Is this what it feels like to be SoftBank? I'm investing into Totogi because it's going to enable telcos to leverage their network interactions into super app usage! Which will lead to an improved subscriber experience, and will give you a massive jump in your ARPU. And once you do that, all those telco valuations will go from down here, (buzzes lips) to up here. And so I've been talking to some folks, you know, checking in, feeling them out, getting their thoughts. And I've been asking them, what do you think about telcos building super apps? And the response has been, "Click. Eh." Everyone says, no way. Telcos can't do it. Zero chance. Total goose egg. (egg cracking) One suggested I build a bonfire with a hundred million dollars, because then at least I wouldn't waste years of my life. Well, I think those people are dead wrong! I do believe that telcos can build super apps and make them super successful. The public cloud is changing all parts of telco, and Totogi and super apps are fundamentally changing the customer relationships. In one month at MWC, people will see what Totogi has to offer, and they will understand why I'm making this bold call. Because Totogi takes the value of the network, and the power of the public cloud, to help telcos move from being network centric, to being customer centric. Boom! If you want to make this transformation and reap all the financial benefits, you will have to compete for customers with a whole new set of players. You will no longer compete with the network focused guys, like the other telcos. Instead, you will be competing against the customer focused companies. These players don't have a network to fall back on like your old competitors, they know they have to make customers love them. Their customer loyalty is so off the charts, their customers are called fans. So if you want that big money, you will have to compete on their turf, and make the customers want to choose you. You need Apple level loyalty. That bar is uber high. We'll have to give up the security blanket of the network, and change. Instead of NPS at the thirties, it needs to be in the seventies. Instead of mobile app ratings in the threes, they need to get five stars. I'm betting big that Totogi will make that possible! I'm going to help you every step of the way, starting with my keynote next month at MWC. Join me, and I'll share the secrets to converting your super valuable network interactions to make your super app a massive success. We're going to have an amazing time, and I can't wait to see you there! >> Okay. We're back here in theCUBE here at Mobile World Congress in Cloud City. I'm John Furrier. Chloe Richardson's filling in for Dave Vellante who's out on assignment. He's out getting all the data out there and getting stories. Chloe, what a great keynote by Danielle Royston. We just heard her involving major action, major pump you up, punch in the face, "Wake the heck up cloud people, cloud is here!" She didn't pull any punches. >> No, I mean the thing is, John, there's trillions of dollars on the table, and everyone seems to be fighting for it. >> And you heard her up there, if you're not on the public cloud, you're not going to get access to that money. It's a free for all. And I think the cloud people are like, they might think they're going to walk right in, and the telco industry is going to just give it up. >> No, of course. >> And it's not going to be, it's going to be a fight! Who will win? >> Who will win, but also who will build the next big thing? (John laughing) >> Someone needs to die in the media conversations. It's always a fight. Something's dead. Something's dead but keeps the living. All that kidding aside, this is really about partnering. Think what's happened is Telco's already acknowledged that they need to change. And the 5G edge conversation, the chip acceleration. Look at Apple. They've got their own processors, Nvidia, Amazon makes their own chips, Intel's pumping stuff out, you've got Qualcomm. You've got all these new things. So, the chips are getting faster, and the software's more open source. And I'm telling you, the cloud is just going to drive that bus right down Cloud Street, and it's going to be in Cloud City everywhere. >> And it's going to be peepin' on the board as it drives down. (John laughing) John, I'm not a stalker, but I have read some of the things that you've written, and one of the things you mentioned that was really interesting was the difference between building and operating. Break it down for me, what does that mean? >> That means basically in mature markets, and growing markets, things behave differently, and certainly economics, and the people, and the makeup, and the mindset. So the telco has been kind of this mature market, it's been changing and growing, but not like radically. Cost optimization, make profit. You know, to install a lot of cable, you got to get the rents out of that infrastructure. And that's kind of gone on for too long. Cloud is a growth market. And it's about building, not just operating. And you've got operators, carriers are operating networks. So you're going to see the convergence of operators and builders coming together. Builders being software developers, new technology, and executives that think about building. And you want people on your team that are going to be, I won't say war time, you know, lieutenants or generals, but people who can handle the pace of change. Because the change and the nature is different. And some people want slow and steady, keep the boat from rocking. But in a growth market, it's turbulent, and the ride might not be quiet, first-class ticket to paradise. It's bumpy, but it's thrilling. >> No, of course. Is it similar to the old sales adage of hunter versus farmer? Are there parallels there? >> Yeah. I mean, there's a mindset. If you have a team of people that aren't knocking down new opportunities and building the next big thing, fixing your house, get your house in order, you know, refactor, reset, reboot, replatform with the cloud, and then refactor your business! If you don't have the people thinking like that, you're probably either going to be taken over, or go out of business. And that's what the telcos with all these assets, they're going to get bought, rolled into a SPAC, Special Purpose Acquisition Company, which is super hot in the United States. A lot of roll-ups going on with private equity. So a lot of these telcos, if they don't refactor, or replatform then refactor, they're going to be toast, and they're going to get rolled up, and eaten up by somebody else. >> Yeah, sure. It's interesting though, isn't it? Because when we think of telco in tech, we often think of, obviously we've got the triad, people, process, technology, and we think, process and technology really to the forefront here. But like you said there, people are also so important because if you don't have this right balance, you're not going to be able to drive that change. We had, obviously, Scott Brighton on the stage yesterday, and after his session, somebody came up to me and just said, "I'm interested to hear what that means for education." So how can we establish this new generation of tech and telco leaders from the grassroots with educational associations, establishments. How can we encourage that? I wonder, is this something that you talk about? >> Yeah. I mean, education's huge, and this highlights the change that telco's now part of. Telco used to be a boring industry that ran the networks, or moving packets around, and mobile was there. But once the iPhone came out in 2007, the life has changed, society has changed, education's changed, how people interact has changed. So, you start to see people now aware of the value. And if you look at during COVID, the internet didn't crash, the telcos actually saved our asses, and everyone survived because the network didn't break. Yeah, we had some bad Zoom meetings here and there, and some teleconferences that didn't go well, but for the most part we survived, and they really saved everybody. So, they should get kudos for that. But now they're dependent upon healthcare, education. People care about that stuff, so now you're going to start to see an elevated focus on what telecom is doing. That's why the edge has got trillions of dollars up for grabs. But education, there's negative unemployment in cybersecurity and in cloud. So for the people who say, "Oh, there's no jobs." Or, "I can't work." That's a bunch of BS, because you can just get online, get on YouTube, and just get a degree. You can get a degree. You can get an Amazon job. It pays a hundred thousand dollars a year! American. You can make a hundred thousand pounds, and be unemployed six months, and then be employed. So negative unemployment means, there's more jobs than people to fill them all, in fact. >> Yeah, it's interesting you mentioned that, because I was talking to a cyber security leader who was saying in something, I think there were now 3 million vacancies in cybersecurity. And there's such a skill shortage. There is nobody around to fill it! So it's an interesting problem to have, isn't it? Because it's reversed to what we've been used to for the last few decades! And obviously, telco is in the same space. But what can we do about it do you think, to actually -- >> I think it's going to take leadership, and I'm a big proponent of kids not going to university if they don't have to. Why spend the dough, money, if you don't have to? You can get online. I mean, the data's there. But to me, it's the relationships, the mentorship. You're starting to see a women in tech, and underrepresented minorities in the tech field, where mentorship is more important than curriculum. Community is more important than just going through a linear courseware. Nobody wants to sit online and go through linear courseware. Now, if they have to get a certificate, or degree, and accreditation, no problem. But the communities are out there, so that's a big change over, I'm a big fan of that. And I think people should, you know, get some specialized skills. You can get that online, so why even go to school? So, people are figuring that out. >> For sure. And also, even transferring. I mean, so many skills are transferable nowadays, aren't they, so we could easily be talking to people from other industries, and bringing them into telco, and saying, "Look, bring what you know from your retail background, or your healthcare background, and help us at telco to, again, drive forwards." Just like DR was saying, it's all about the next big thing. >> Well, Danielle is always also driving a lot of change. And if you think about the jobs, and the pedigree of going to a university, oh, Harvard, all the big Ivy Leagues, Oxford in your area. So it's like, if you go to the school like that, and you get a pedigree, you instantly get a job. Now the jobs that are available weren't around five years ago, so there's no like pedigree or track record. There's no like, everyone's equal. >> Yeah. >> So you could, the democratization of the internet now, from a job standpoint, is people are leveling up faster. So it's not about the Ivy League, or the big degree, or silver spoon in your mouth, you've got the entitlement. So you start to see people emerging and making things happen. Entrepreneurship in America, immigrant entrepreneurship. People are billionaires that have no high school diplomas! >> It's interesting you mention that, John, because we can't have more than five years experience in this space, we know that. But in telco, there is a problem. And maybe it's, again, it's a flipped problem where telco recruiters, or talent acquisition leaders, are now asking for kind of 10, 20 years experience when they're sending out job descriptions. So does that mean that we are at fault for not being able to fill all these vacancies? >> I think that's just, I mean I think there's a transition of the new skill set happening, one. But two, I think, you know, to be like a chip engineer, (laughs) you can't learn that online. But if you want to run a cloud infrastructure, you can. But I think embedded systems is an area that I was talking to an engineer, there's a huge shortage of engineers who code on the microprocessors, on the chips. So, embedded systems is a big career. So there's definitely paths you can specialize. Space is another area you've seen a lot of activity on. You see Jeff Bezos and Elon Musk is going to be here on a virtual keynote, trying to go to Mars. And you know, Danielle Royston always says, "What's going to happen first, Mars colony, or telco adopting public cloud?" And some people think Mars will happen first, but. >> What do you think, John? >> I think Telco's going to get cloud. I mean first of all, public cloud is now hybrid cloud, and the edge, this whole internet edge, 5G, is so symbolic and so important, because it's an architectural beachhead. And that's where the trillion dollar baby is. So, the inside baseball, and the inside money, and all the investors are focusing on the edge, because whoever can command the edge, wins all the dollars. So everyone kind of knows, it's a public secret, and it's fun to watch everyone jockey for the positions. >> Yeah no, it really is. But it's also quite funny, isn't it? Because the edge is almost where we were decades ago, but we're putting the control back in the hands of consumers. So, it's an interesting flip. And I wonder if, with the edge, we can really enhance this acceleration of product development, this efficiency, this frictionless system in which we live in. And also, I've heard you say hybrid a few times, John. >> John: Yeah. >> Is hybrid going to be the future of the world no matter what industry you're in? >> Hybrid is everything now. So, we're the hybrid CUBE, we've got hybrid cloud. >> Exactly. >> You got hybrid telco, because now you've got the confluence of online and offline coming together. That is critical dynamic! And you're seeing it. Like virtual reality, for instance, now you're seeing things, I know you guys are doing some great work at your company around creating experiences that are virtual. You got, companies like Roblox went public recently. Metaverse. It's a good time to be in that business, because experiential human relations are coming. So, I think that's going to be powered by 5G. You know, gamers. So, all good stuff. Chloe, great to be with you here on theCUBE, and we're looking forward to seeing your main stage. >> Great. >> And then we're going to send it back to the studio, Adam, and the team. We're waiting for DR to arrive here in Cloud City. And this is theCUBE, from Cloud City, back to you, Adam, and the studio.

(upbeat music) >> Okay, thanks Adam in the studio. We're here on the floor in Cloud City, right in the middle of all the action. The keynotes are going on in the background, it's a packed house. I'm John Furrier. Dave Vellante is on assignment, digging in, getting those stories. He'll have the analysis, he'll be back on theCUBE but I want to welcome Chloe Richardson, who has been holding down the main stage here in Cloud City, with amazing content that she's been hosting. Chloe, great to see you. Thanks for coming on theCUBE and kicking it up day two with me. >> No, not at all. Thank you for having me. It's very exciting. I love what you guys have got over here, very fun. >> We're inside theCUBE. This is where all the action is. And also the Cloud City is really changing the game. If you look at what's going on here in Cloud City, it's pretty spectacular. >> Know, I mean the atmosphere is absolutely palpable, isn't it? You can just feel as people walk in and see what the future looks like to the Telecoms industry, it's very exciting. >> And you've been doing a great job on the main stage. We've been really loving your content. Let's get into some of the content here. Actually the keynote is going on, we're going to have DR, maybe fly by the set later, we're going to check that up. But let's check out this videotape of, this is TelcoDR. You got to check out this reel and we'll be right back, we'll talk about it. (upbeat music) >> TelcoDR burst onto the global telecom scene this year, making headlines for taking over the huge Erickson's space at MWC21. And for building Cloud City in just a hundred days. But why did the company go to such trouble? And what is the unique offering to the telecoms industry? And what drives their dynamic CEO, Danielle Royston or DR as everyone calls her? Cloud City Live caught up with DR, away from the hustle and bustle of the city to find out. (upbeat music) >> Hi, I'm Danielle Royston, coming to you from beautiful Barcelona. I'm here for MWC21. About a hundred days ago, I decided to take over the iconic Erickson booth to turn it into Cloud City. Cloud City has over 30 vendors and 70 demos to introduce telco to what I think is the future for our industry. We're going to have three awesome experiences. We're going to talk about the new subscriber experience, we're going to talk about what's in store for the new network and the future of work. I'm really excited to create a community and invite awesome telco executives to see this new future. It's been a really tough 18 months, and we didn't know what MWC21 was going to be like in terms of attendance. And so from the get go we plan this amazing experience that we call, Cloud City Live. At Cloud City Live, we have two main components. We have the speaker series where we have over 50 speakers from Amazon, Google, Microsoft, as well as CSPs and awesome vendors talking about the public cloud in telco. The second part of Cloud City Live, is theCUBE. Think of this as like an ESPN desk of awesome tech interviews focused on telco and the public cloud hosted by John Furrier and Dave Vellante. Dave and John are going to talk to a variety of guests, focused on telco and the public cloud. It's a great way for our virtual participants to feel like they're at the show, experiencing what's going on here. So excited to have them as part of the Cloud City booth. There's a ton of innovation going on in telco. And 20 years ago, Elon Musk set on his mission to Mars. I, like Elon Musk, I'm on a quest to take telco to the public cloud. Every year at MWC, there's always a flurry of announcements and this year is no different. At this year's MWC, Totogi, a startup that I invested a hundred million dollars in, will be launching. Totogi is introducing two products to the market, this week at MWC. The first is a planetary scale charger. More than a charger, it's an engagement coupling dual network data with charging information to drive subscriber engagement and doubling your ARPU. The second product that Totogi is introducing, is a planetary scale BSS system built on top of the TM forum, open APIs. Both of these products will be available for viewing in the virtual booth, as well as on the show for. The public cloud is an unstoppable mega trend that's coming to telco. I'm super excited to bring to you, the vendors, the products, the demonstrations, and the speakers, both to people here in Barcelona and virtually around the world. (upbeat music) >> Well, that was a fascinating insight into the origins of TelcoDR, why public cloud is going to truly disrupt the telecoms industry and why DR herself is so passionate about it. If you'd like to find out more, come and see us at Cloud City. (upbeat music) >> Okay, thanks. Just roll on that reel. Chloe, I mean, look at that reel. I mean, DR, Danielle Royston, she's a star and I've seen a lot of power players in the industry. She's got guts and determination, and she's got a vision and she's not just, you know, making noise about telco and cloud, there's actually a lot of real good vision there. I mean, it's just so impressive. >> No, really isn't. And for me, it's almost like the next moonshot. It's the moonshot of the telco world. She's innovative, she's exciting and if we've learned anything over the last 18 months is that we need to in this industry to grow and for the future of the industry. So, it's so exciting. I think she's a real inspiration. >> And I love the fact that she's so, takes a tiger by the tail, because the telco industry is being disrupted. She's just driving the bus here and I remember I did a story on Teresa Carlson, who was with Amazon web services, she was running the public sector and she was doing the same exact thing in that public sector world in DC and around the world. She opened up regions in Bahrain, which as a woman, that was an amazing accomplishment. And she wasn't just a woman, she was just a power player. And she was exceptional leader. I see DR doing the same thing and people aren't going to like that, I'll tell you right now. People are going to be like, whoa, what's going on here? >> And of course, it's always the way we pioneers though, isn't it? At the time people thinking what's going, we don't like change, why are we being shaken up. But actually afterwards, in retrospect, they think, oh, okay, I see why that happened and we needed it. So really exciting stuff. >> Making things happen, that's what we're doing here in theCUBE. Obviously the main stage's doing a great job. Let's go check out this highlight reel. If you're watching and you miss some of the action, this is, I'll see the physical event back since 2019 in February, but there's also a Hybrid event. A lot of virtual action going on. So you got theCUBE virtual, you got a lot of content on virtual sites, but in person here, we're going to go show you a highlight reel from what we did yesterday, what was happening around the show? Enjoy this quick highlight reel from yesterday. (upbeat music) (upbeat music) (upbeat music) Okay. We're back here in theCUBE. We're the main floor out here with Chloe Richardson, who is emceeing, hosting and driving the content on the Cloud City main stage. Chloe, it's been great here. I mean, so far day one, I was watching your presentations and inspire site chats you've been hosting. Awesome content. I mean, people are like jazzed up. >> Yeah, I know for sure. We had Scott Brighton on yesterday, who was our opening keynote on the live stage. And his session was all about the future of work, which is so relevant and so pertinent to now. And he talked about the way it's changing and in 10 years it's going to be a trillion dollar industry to be in the cloud at work. So really interesting. I mean, yeah, the atmosphere here is great, everyone's excited, there's new content everyday. And that's the thing, it's not stale content. It's stuff that people want to hear. People are here for the new hot trends, the new hot topics. Really exciting. >> Yeah, the next big thing. And also it's a fiscal event. So since 2019, this Mobile World Congress has been a massive event and hasn't happened since February, 2019. That's a lot of time that's elapsed in the industry cause of COVID and people are glad to be here, but a lot of stuff's changed. >> Yeah, it's a different world, right? I mean, two years in the telco industry is like a hundred years elsewhere. Everything has changed, digital transformation migration, obviously cloud, which is what we're talking about over here at Cloud City Live. I'm wondering though John, I'd like to pick your brains on something. >> Sure. >> It has changed in the last two years, we know that, but what about the future of Mobile World Congress? How do you see it changing in the next few years? >> Oh man, that's a great question. I mean, my observation, I've been coming to the show for a very long time, over a decade and a half, and it's been a nerdy show about networks and telecom, which is basically radios and wireless and then mobile. It's very global, a lot of networks, but now it's evolving and many people are saying, and we were talking on theCUBE yesterday, Dave Vellante was commenting that this show is turning into a consumer like show. So CES is the big consumer electronics show in the US, in Las Vegas every year. This show has got a vibe because what's all the technology from the cloud players and from the chips, are getting smaller, faster, cheaper, more capability, lower power. So if you look at the chips, the hardware, it's less about the speeds and feeds. It's more about the consumer experience. You got cars. I was talking to a guy yesterday, he said, "Vehicle e-commerce is coming." I'm like, "What the hell his vehicle e-commerce?" And you could be on your app, driving down the freeway and go, "Hey, I want some food." Instead of having it delivered to you, if you order it you pick it up. So that's kind of can be happening now in real time, you can do all kinds of other things. so a lot of new things are happening. >> Yeah, I think so. Do you see that as another disruption for the industry that is the fact that it's moving to be more consumer focused? Is that anything we should be worried about in that space? >> Well I think the incumbents are going to lose their position. So I think in any new shift, new brands come in out of nowhere. >> For sure. >> And it's the people that you don't think about. It's the company that's not, that you don't see. And we got DR on the main stage right here, look at this. You saw her walk out with the confidence of a pro. She just walked out there and she's not afraid. >> No. Well, as she said in her video, she is ready to wake them up and you can see as soon as she worked out. That is what she intends to do. >> I love her mojo, she's got a lot of energy. And back to the show, I mean, she's just an example of what I was saying. Like in every market shift, a new brand emerges. >> Yep. >> I mean, even when apple was tainted, they were about to shut down, they were going to run out of cash. When Steve Jobs brought back apple, he consolidated and rebooted the company. The iPad was a similar moment, then the iPhone and just the rest is history. That kind of disruption's coming. You're going to see that here. >> Yeah. Oh, it's exciting though isn't it? To be future ready rather than future proof but actually I wanted to ask you something as well, because we are seeing all these cloud players getting hot under the collar about telco. Why are they so excited? What's the buzz about why, as you're in MWS and Google Cloud? Why do they want to have a slice of the pie? >> Well, I think they're hot, hot and heavy on the fact that telco is a ripe opportunity and it used to be this boring, slow moving glacier. >> Okay. >> It's almost like global warming now. The icebergs are melting and it's going to just change and because of the edge, 5G is not a consumer wireless thing. It's not like a better phone, it's a commercial app opportunity cause it's high bandwidth. We've all been to concerts or football games or sporting events where a stadium is packed. Everyone gets bars on their wifi, but can't get out, can't upload their pictures on Instagram. Why? Because it's choking them in the network. That's where 5G solves the problem. It brings a lot of bandwidth and that's going to bring the edge to life and that's money. So when you got money and greed and power changing hands, it's every, it's on the table and the wheel's spinning, and it could be double zero, or it could be lucky seven. You don't know. >> Yeah, for sure. And that's certainly enough to get all the big players hot and bothered about getting involved. And I suppose it circles back to the fact that, DR is really leading the charge and they're probably thinking, okay, what's going on here? This is different, we want something new. You didn't know it's an open run or something that we've been talking about over the last day or so. We've had quite a few of us speakers over here constantly. I've mentioned open run. What is it all about John? Because why all the bars, if 5G is such a hot topic? Why are we getting excited about it? >> That's a great thing. 5G certainly is Google Drive the main trend for sure. OpenRent is essentially an answer to the fact that 5G is popular and they need more infrastructure. So open source, the Linux Foundation has been the driver for most of the open source software. So they're trying to bring software and open architectures to create more entrepreneurial activity around hardware and around infrastructure because we need more infrastructure. We need more antennas, we need more transceivers, we need more devices that could be open. So in order to do that, you got to open up the technology and you want to minimize the licensing and minimize a lot of these, you know, proprietary aspects. >> What if we look at, so on Wednesday, we've got a great keynote from Philippe Langlois, who is CEO and founder of P1 Security. And he's coming to talk to us about cybersecurity within the cloud and within telco. So you just mentioned that. Open mind, it's all about having open source, about having that space where we can share more efficiently and easy, more easily. What does that mean for security though? Is it a risk? >> I think that's going to increase the value of security and minimize the threats. Because open source, even though it's open, the more people that are working on it, the more secure it could be. So yes, it could be more open in sense that could be explored by hackers, but it can be open to also protect. And I think we've seen open source and cloud in particular be more secure because everyone said, "Cloud is not secure, open source is not secure." And as it turns out when the collective hive minds of developers work on things, it gets secure. >> And it is interesting, isn't it? Because we have seen that there has been an uptick in cyber security and threats. But actually I was speaking to some leaders in across various industries and particularly in tech. And they were saying, "Actually there's not been an uptick in attempted threats, there's been an uptick because with this open source environment. We are able to track them and measure them and defend more efficiently. So actually they're being battered away, but the number is probably the same as it always was. We just didn't know about them before we had this open source environment. >> There's more money in threats and there's more surface area. So as the tide rises, so do the threats. So on a net basis it's more because there's more volume, but it's pretty much the same. And look at it, there's money involved, they're organized, there's a business model on attacking and getting the cash out of your bank or ransomwares at an all time high. So this is like a big problem and it's beyond the government, it's our individual freedom. So security its huge and I think open source and cloud are going to be, I think the answer to that. >> Yeah, for sure. And it's again about collaboration, isn't it? Which we talk about all the time but without collaboration that the industries aren't going to have to work together to promote this environment. So yeah, it should be good to talk with Phillip on Wednesday. >> I just say in security, don't download that PDF if you don't know who came from. The fishing is always good. Well, we got some great stuff coming up. We're going to have a great day. We got a video here on Mobile World Live, we're going to show this next segment and we're going to toss it to a video. And this is really about to give the experience Chloe, for people who aren't here, right? >> Yeah. >> To get a feel for what's going on in Barcelona and all the actions. And if you look at the video, enjoy it. >> Hi, I'm Danielle Royston, CEO and founder of TelcoDr, but you can call me DR. Ready for some more straight talk about telco? It's go time, let's do it. Holy shit. It sure is a great time to be a tech company. I mean, if you're Amazon, Microsoft, Google, Grab, Twilio, DoorDash or Uber, life's pretty great. Just look at these stock prices over the past five years with their shareholder value going up into the right. Totally amazing. But where's telco? There I add our stocks to this awesome chart. Let's compare these fabulous tech stocks to AT&T, Vodafone, Telefonica, Tim, America Movil and Zain group. Huh, not so great, right? Yep. I'm talking directly to you senior telco execs. I'm here to wake you up. Why is it that Wall Street doesn't see you as tech? Why aren't CSPs seen as driving all the tech change? Why is it always Apple, Amazon and Google who get the big buzz? But more importantly, why isn't it you? Before I came to this industry, I always thought of carriers as tech companies. I gave more of my money to AT&T and to Apple because I really cared about the quality of the network. But I also wondered why on earth, the carriers allowed all the other tech companies to take center stage. After spending the last few years in telco, I now understand why. It's because you are network people, you are not customer people. I get it, you have the security blanket, you're a network oligopoly. It's crazy expensive to build a network and it's expensive to buy spectrum. It takes operational chops to run a killer network and it takes great skill to convince Wall Street, to finance all of it. You telco execs are amazing at all those things, but because you focus on the network, it means you don't focus on the customer. And so far you haven't had to. Every telco's KPI is to be less shitty than their next competitor. You don't have to be the best, just don't be last. Everyone else's NPS, is in the thirties too. Their mobile app ratings are just as terrible as yours. Everyone's sucks at customer sat and it's widely acknowledged and accepted. Let's talk about the cost of that. The cost is not measured on market share against other MNOs. The cost is measured in lost ARPU that the tech guys are getting. Everyone knows about the loss of texting, to WeChat, WhatsApp and the other OTT apps, but it is not just texting. The total adjustable market or term of the mobile app disruptors is huge. Instead of remaining network focused, you should be leveraging your network into a premier position. And because you're a network people, I bet you think I'm talking about coercive network leverage. That is not what I'm talking about. I'm talking about love, customer love. There is one thing the highly valued tech companies all have in common. They all crush it on customer love. They look at every interaction with the customer and say, "How do we make the customer love this?" Like Netflix has easy monthly cancellation, Amazon does no questions asked returns, Uber gives users a real time view into driver rating and availability. Compare those ideas to the standard telco customer interaction. The highly valued tech companies, don't have the network oligopoly to fall back on like you do. To survive they must make customers love them. So they focus on it in a big way and it pays off. Their NPS is close to 70 and they have app ratings of 4.5 or higher. A far cry from your thirties NPS and app ratings of 3.5. If you want to have those huge tech multiples for yourself, you have to start thinking about these guys as your new competition, not the other telcos in your market. The crazy thing is, if you give up using your network as a crutch and put all of your focus on the customer, the network becomes an asset worth more than all the super apps. Let's step back and talk about the value of super apps and becoming customer centric. Retooling around the customer is a huge change. So let's make sure it's worth it. We aren't talking about 25% improvement. I'm going to show you that if you become customer centric, you can double your ARPU, double your valuation multiples and drive big shareholder value just like the tech companies on that chart. Now let's talk about the customer focused super apps. There are hundreds of companies and a variety of categories vying for your subscriber's disposable income. Movies, food delivery, financial services, who are they? And why does Wall Street give them such high evaluations and like them so much? Well first, look at what they are telling Wall Street about their TAM. They broadcast ridiculously huge TAMs that are greater than the telco TAMs. You know, who should have a ridiculously huge TAM? You. Hello. What I'm saying is that if you got what's yours, you double in size. And if you take the TAAMs they throw around, you'll be five times as big. When I think about the opportunity to double ARPU, without having to double the CapEx, to build out the network, I say to myself, "Hell yeah, we should totally go do it and do whatever it takes to go get." For example, let's talk about Grab. Grab is a southeast Asian super app company with an expected $40 billion valuation. Grab's customer focused started in rideshare, but then leverage its customer love into wallet deliveries, hospitality, and investing. Their ARPU is now larger than a telco's ARPU in countries where they compete, and they have a higher valuation than those telcos too. Imagine if you could combine a great user experience with a valuable services that helped grow your ARPU, that would be huge. So how do you build a super app? I bet right about now, you're wishing you had a super app. Everyone wants a super app. A lot of money has been unsuccessfully spent by telcos trying to build their own. I bet you're saying to yourself, "DR, your pie in the sky sounds great but it has no chance of success." Well, I'm betting things are about to change. There is a public cloud startup called Totogi that is going to help carriers build world class super apps. To have a successful super app, there is one key metric you need to know. It is the KPI that determines if your super app will be a success or a flop. It's not about the daily active users, it's not the average order value, it's not even gross merchandise value. It's all about the frequency of use per day by the user, that's the metric that matters. How many of you use that metric in your telco apps? Do you have a team driving up user app interactions every day? Most telco apps are used for top up or to check a bill. This is a huge missed opportunity. Super app companies excel at building great experiences and driving a huge amount of interactions. They have to, their business depends on it. They have to be customer focused. They have to keep bringing the user back to the app, every day, multiple times a day. And you know what? They do a great job. Customers love their super apps. They have great user experiences like Apple credit cards, no information required, application process. They have high net promoter scores because of customer friendly policies, like how DoorDash retroactively credits fees when you move to a better plan. And they have great app store ratings because they do simple things like remember your last order, or allow you to use the app rather than force you to call customer service. Customers of successful super apps love it when new services are added. And because of the customer love, every time something is added to the app, customers adopt it immediately. New services drive frequent daily user interactions. So our problem in telco is we have an app that is only open once per month, not multiple times per day. And without frequent opens, there is no super app. What do we do we have in telco that we could use to help with this problem? I wonder, why you don't currently have a mobile app that subscribers use multiple times a day. You have something that's 10 times better. You have a network. Subscribers already interact with your network 10 times more frequently than any user with any of the super apps. But telcos don't leverage those interactions into the insanely valuable engagements they could be. Worse, even if you wanted to your crappy over customized on premise solutions, make it impossible. Thankfully, there's this new tech that's come around, you may have heard of it. The public cloud. When you bring the enabling technology of the public cloud, you can turn your network interactions into valuable super app interactions. And there's a special new startup that's going to help you do it, Totogi. Totogi will leverage all those network interactions and turn them into valuable customer interactions. Let me repeat that. Totogi will leverage all those network interactions and turn them into valuable customer interactions. Totogi allows the carrier to leverage its network and all the network interactions into customer engagement. This is something the super apps don't have but will wish they did. But this magic technology is not enough. Telcos also need to move from being network focus to being customer focused. Totogi enables telcos to chase exciting revenue growth without that annoying massive CapEx investment. Totogi is going to help you transform your sucky mobile apps with the crappy customer ratings, into something your subscribers want to open multiple times a day and become a platform for growth. I'm so excited about Totogi, I'm investing $100 million into it. You heard me right, $100 million. Is this what it feels like to be soft bank? I'm investing in Totogi because it's going to enable telcos to leverage the network interactions into super app usage. Which will lead to an improved subscriber experience and will give you a massive jump in your ARPU. And once you do that, all those Telco valuations will go from down here to up here. And so I've been talking to some folks, you know, checking in, feeling them out, getting their thoughts, and I've been asking them, what do you think about telcos building super apps? And the response has been, click, everyone says, "No way, telcos can't do it." Zero chance, total goose egg. One suggested I build a bonfire with 100 million dollars, because then at least I wouldn't waste years of my life. Well I think those people are dead wrong. I do believe that telcos can build super apps and make them super successful. The public cloud is changing all parts of telco and Totogi and super apps are fundamentally changing, the customer relationships. In one month at MWC, people will see what Totogi has to offer, and they will understand why I'm making this bold call. Because the Totogi takes the value of the network and the power of the public cloud to help telcos move from being network centric, to being customer centric. Boom! If you want to make this transformation and reap all the financial benefits, you will have to compete for customers with a whole new set of players. You will no longer compete with the network focus guys like the other telcos, instead you will be competing against the customer focused companies. These players don't have a network to fall back on like your old competitors. They know they have to make customers love them. Their customer loyalty is so off the charts, their customers are called fans. So if you want that big money, you will have to compete on their turf and make the customers want to choose you, you need Apple level loyalty. That bar is uber high. We will have to give up the security blanket of the network and change. Instead of NPS of the thirties, it needs to be in the 70s. Instead of mobile app ratings in the threes, they need to get five stars. I'm betting big that Totogi will make that possible. I'm going to help you every step of the way, starting with my keynote next month at MWC. Join me and I'll share the secrets to converting your super valuable network interactions to make your super app a massive success. We're going to have an amazing time and I can't wait to see you there. >> Okay. We're back here in theCUBE here at Mobile World Congress in Cloud City. I'm John Furrier, Chloe Richardson filling it for Dave Vellante who's out on assignment. He's out getting all the data out there and getting stories. Chloe, what a great keynote by Danielle Royston. We just heard her and while with major action, major pump me up, punch in the face, wake the heck up cloud people, cloud is here. She didn't pull any punches. >> No, I mean the thing is John, there's trillions of dollars on the table and everyone seems to be fighting for it. >> And you heard her up there, if you're not on the public cloud, you're not going to get access to that money. It's a free for all. And I think the cloud people are like, they might think they're going to walk right in and the telco industry is going to just give it up. >> No, of course. >> There's not going to be, it's going to be a fight, who will win. >> Who will win but also who will build the next big thing? >> Someone needs to die in the media conversation, it's always a fight, something's dead, something's dead but keeps the living. All that kidding aside, this is really about partnering. I think what's happened is, telco's already acknowledged that they need to change in the 5G edge conversation, the chip acceleration. Look at Apple, they've got their own processors, Nvidia, Amazon makes their own chips, Intel's pumping stuff out, you've got Qualcomm, you've got all these new things. So the chips are getting faster and the software's more open source and I'm telling you, cloud is just going to drive that bus right down clouds street and it's going to be in Cloud City everywhere. >> And it's going to be peeping on the board as it drives down. John, I'm not a stalker, but I have read some of the things that you've written. And one of the things you mentioned that was really interesting was the difference between building and operating. Break it down for me. What does that mean? >> That means basically in mature markets and growing markets things behave differently and certainly economics and the people and the makeup and the mindset. >> Okay. >> So the telco has been kind of this mature market. It's been changing and growing but not like radically. Cost optimization, make profit, you know, install a lot of cable. You got to get the rents out of that infrastructure and that's kind of gone on for too long. Cloud is a growth market, and it's about building, not just operating and you've got operators, carriers are operating networks. So you're going to see the convergence of operators and builders coming together, builders being software developers, new technology and executives that think about building. And you want people on your team that are going to be, I won't say war time, you know, lieutenants or generals, but people who can handle the pace of change. >> Okay. >> Because the change and the nature is different. And some people want slow and steady, keep the boat from rocking, but in a growth market, it's turbulent and ride might not be quiet, first class ticket to paradise, but it's bumpy, but it's thrilling. >> No, of course. Is it similar to the old sales adage of hunter versus farmer and the parallels? >> Yeah. I mean, the mindset. If you have a team of people that aren't knocking down new opportunities and building the next big thing, fixing your house, get your house in order, you know, refactor, reset, reboot, re platform with the cloud and then refactor your business. If you don't have the people thinking like that, you're probably either going to be taken over or go out of business. And that's what the telco with all these assets, they're going to get bought roll into a SPAC, special purpose acquisition company was a super hot in the United States. A lot of roll ups going on with Private equity. So a lot of these telcos, if they don't refactor or re platform, then refactor, they're going to be toast and they're going to get rolled up and eaten up by somebody else. >> Yeah, sure. It's interesting though, isn't it? Because when we think of telco in tech, we often think of, obviously we've got the triad. People process technology, and we think process and technology really take the forefront here but like you said there, people are also so important because if you don't have this right balance, you're not going to be able to drive that change. We had, obviously Scott Brighton on the stage yesterday and after his session, somebody came up to me and just said, "I'm interested to hear what that means for education." So how can we establish this new generation of tech and telco leaders from the grassroots with educational associations establishments? How can we encourage that? I wonder, is this something that you talk about often? >> Yeah. I mean, education is huge and this highlights the change that telcos now part of. Telco used to be a boring industry that ran the networks, or moving packets around and mobile was there, but once the iPhone came out in 2007, the life has changed, society has changed, education's changed, how people interact has changed. So you start to see people now aware of the value and if you look at the, during the COVID, the internet didn't crash, the telcos actually saved our asses and everyone was, survive because the network didn't break. Yeah, we had some bad zoom meetings here and there and some teleconferences that didn't go well but for the most part we survived and they really saved everybody, my goodness. So they should get kudos for that. But now they're dependent upon healthcare, education, people care about that stuff. So now you're going to start to see an elevated focus on what telecom is doing. That's why The Edge has checked trillions of dollars up for grabs. But education, there's negative unemployment in cybersecurity and in cloud. So for the people who say, oh, there's no jobs or I can't work, that's a bunch of BS because you can just get online, get on YouTube and just get a degree. You can get a degree, you can get an Amazon job, it pays a hundred thousand dollars a year, American. You can make a hundred thousand pounds and be unemployed six months and then be employed. So negative unemployment means there's more jobs than people to fill them qualify. >> Yeah, it's interesting you mentioned that because I was talking to a cyber security leader who was saying in some of the things there were now 3 million vacancies in cybersecurity and there's such a skill shortage, there is nobody around to fill it. So it's an interesting problem to have isn't it? Cause it's reversed to what we've been used to for the last few decades and obviously telco is in the same space. What can we do about it? Do you think it will actually bring people in? >> I think it's going to take leadership and I'm a big proponent of kids not going to university, they don't have to. Why spend the dough, money if you don't have to? You can get online. I mean, the data's there, but to me it's the relationships, the mentorship. You starting to see women in tech and underrepresented minorities in the tech field, where mentorship is more important than curriculum. Community is more important than just going through a linear course where nobody wants to sit online and go through linear courseware. Now, if they have to get a certificate or degree and accreditation no problem, but communities are out there. So that's a big change over, I'm a big fan of that and I think people should, you know, get some specialized skills, you can get that online. So why even go to school? So people are figuring that out. >> For sure. And also even transferring, I mean, so many skills are transferable nowadays, aren't there? So we could easily be talking to people from other industries and bringing them into telco and saying, look, bring what you know from your retail background or your healthcare background and help us at telco to again, drive forward, just like DR is saying it's all about the next big thing. >> Danielle, I was also driving a lot of change and if you think about the jobs and a pedigree of going to a university, oh, Harvard, all the big Ivy leagues, Oxford in your area. So it's like, if you go to a school like that and you get a pedigree, you instantly get a job. Now, the jobs that are available, weren't around five years ago. So there's no like pedigree or track record, there's no like, everyone's equal. >> Yeah. >> So you could, the democratization of the internet now is, from a job standpoint is, people are leveling up faster. So it's not about the Ivy league or the big degree or silver spoon in your mouth, you've got the entitlement. So you start to see people emergent and make things happen, entrepreneurship in America, immigrant entrepreneurship. People are billionaires that have no high school diplomas. >> It's interesting you mentioned that John, because we can have more than five years experience in this space, we know that but in telco there is a problem and maybe it's, again it's a flipped problem where, telco recruiters or talent acquisition leaders, are now asking for kind of 10, 20 years experience when they're sending out job descriptions. So does that mean that we are at fault for not being able to fill all these vacancies? >> Well, I mean, I think that's just, I mean, I think there's a transition of the new skill set happening one, but two, I think, you know, you've got to be like a chip engineer, you can't learn that online, but if you want to run a cloud infrastructure, you can. But I think embedded systems is an area that I was talking to an engineer, there's a huge shortage of engineers who code on the microprocessors, on the chips. So embedded systems is a big career. So there's definitely parts, you can specialize, space is another area you've seen a lot of activity on, obviously Jeff Bezos and Elon Musk is going to be here on virtual keynote, trying to go to Mars. And, you know, Danielle Royston always says, who's going to happen first, Mars, colony, or telco adopting public cloud? Some people think Mars will happen first but. >> What do you think John? >> I think telco's going to get cloud. I mean, first of all, public cloud is now hybrid cloud and the edge, this whole internet edge, 5G, is so symbolic and so important because it's an architectural beachhead. >> Yeah. >> And that's where the trillion dollar baby is. >> Of course. >> So the inside baseball and the inside money and all the investors are focusing on the edge because whoever can command the edge, wins all the dollars. So everyone kind of knows it's a public secret and it's fun to watch, everyone jockey for the positions. >> Yeah, know, it really is. But it's also quite funny, isn't it? Because the edge is almost where we were decades ago, but we're putting the control back in the hands of consumers. So it's an interesting flip and I wonder if with the edge, we can really enhance this acceleration of product development its efficiency, this frictionless system in which we live in. And also, I've heard you say hybrid a few times John. >> Yeah. >> Is hybrid going to be the future of the world no matter what industry you're in? >> Hybrid is everything now. So it's, we're the hybrid cube, we've got hybrid cloud. >> Exactly. >> You got hybrid telco, because now you've got the confluence of online and offline coming together. >> Yeah. >> That is critical dynamic, and you seeing it. Like virtual reality for instance, now you seeing things, I know you guys are doing some great work at your company around creating experiences that are virtual. >> Exactly. >> You got, like Roblox went public recently. >> Yeah. >> Metaverse is a good time to be in that business because experiential human relations are coming. So I think that's going to be powered by 5G, you know, gamers. So all good stuff, Chloe, great to be with you here in theCUBE. >> Thank you. >> And we're looking forward to seeing your main stage. >> Great. >> And then we're going to send it back to the studio, Adam and the team, we're waiting for DR to arrive here in Cloud City and this is theCUBE, from Cloud City back to you, Adam in the studio.

(electronic dance music) (Intel Jingle) (ethereal electronic dance music) ♪ Okay ♪ (upbeat techno dance music) ♪ Oh oh oh oh ♪ ♪ Oh oh oh oh ♪ ♪ Oh oh oh oh oh ♪ ♪ Oh oh oh oh ♪ ♪ Oh oh oh oh oh ♪ ♪ Take it back take it back ♪ ♪ Take it back ♪ ♪ Take it back take it back ♪ ♪ Take it back ♪ ♪ Take it back take it back ♪ ♪ Yeah everybody get loose yeah ♪ ♪ Yeah ♪ ♪ Ye-yeah yeah ♪ ♪ Yeah yeah ♪ ♪ Everybody everybody yeah ♪ ♪ Whoo whoo ♪ ♪ Whoo whoo ♪ ♪ Whoo yeah ♪ ♪ Everybody get loose whoo ♪ ♪ Whoo ♪ ♪ Whoo ♪ ♪ Whoo ♪ >> As a courtesy to the presenters and those around you, please silence all mobile devices, thank you. (electronic dance music) ♪ Everybody get loose ♪ ♪ Whoo ♪ ♪ Whoo ♪ ♪ Whoo ♪ ♪ Whoo ♪ ♪ Whoo ♪ ♪ Whoo ♪ ♪ Whoo ♪ ♪ Whoo ♪ (upbeat salsa music) ♪ Ha ha ha ♪ ♪ Ah ♪ ♪ Ha ha ha ♪ ♪ So happy ♪ ♪ Whoo whoo ♪ (female singer scatting) >> Ladies and gentlemen, please take your seats. Our program will begin momentarily. ♪ Hey ♪ (female singer scatting) (male singer scatting) ♪ Hey ♪ ♪ Whoo ♪ (female singer scatting) (electronic dance music) ♪ All hands are in don't go ♪ ♪ Red all hands are in don't go ♪ ♪ Red red red red ♪ ♪ All hands are in don't go ♪ ♪ Red all hands are in don't go ♪ ♪ Red red red red ♪ ♪ All hands are in don't go ♪ ♪ Red all hands are in don't go ♪ ♪ All hands are in don't go ♪ ♪ Red all hands are in don't go ♪ ♪ Red red red red ♪ ♪ Red don't go ♪ ♪ All hands are in don't go ♪ ♪ In don't go ♪ ♪ Oh red go ♪ ♪ All hands are in don't go ♪ ♪ Red all hands are in don't go ♪ ♪ All hands are in don't go ♪ ♪ Red all hands are in don't go ♪ ♪ Red red red red ♪ ♪ All hands are red don't go ♪ ♪ All hands are in red red red red ♪ ♪ All hands are in don't go ♪ ♪ All hands are in red go ♪ >> Ladies and gentlemen, there are available seats. Towards house left, house left there are available seats. If you are please standing, we ask that you please take an available seat. We will begin momentarily, thank you. ♪ Let go ♪ ♪ All hands are in don't go ♪ ♪ Red all hands are in don't go ♪ ♪ All hands are in don't go ♪ ♪ Red all hands are in don't go ♪ (upbeat electronic dance music) ♪ Just make me ♪ ♪ Just make me ♪ ♪ Just make me ♪ ♪ Just make me ♪ ♪ Just make me ♪ ♪ I live ♪ ♪ Just make me ♪ ♪ Just make me ♪ ♪ Hey ♪ ♪ Yeah ♪ ♪ Oh ♪ ♪ Ah ♪ ♪ Ah ah ah ah ah ah ♪ ♪ Just make me ♪ ♪ Just make me ♪ (bouncy techno music) >> Ladies and gentlemen, once again we ask that you please take the available seats to your left, house left, there are many available seats. If you are standing, please make your way there. The program will begin momentarily, thank you. Good morning! This is Lenovo Transform 2.0! (keyboard clicks) >> Progress. Why do we always talk about it in the future? When will it finally get here? We don't progress when it's ready for us. We need it when we're ready, and we're ready now. Our hospitals and their patients need it now, our businesses and their customers need it now, our cities and their citizens need it now. To deliver intelligent transformation, we need to build it into the products and solutions we make every day. At Lenovo, we're designing the systems to fight disease, power businesses, and help you reach more customers, end-to-end security solutions to protect your data and your companies reputation. We're making IT departments more agile and cost efficient. We're revolutionizing how kids learn with VR. We're designing smart devices and software that transform the way you collaborate, because technology shouldn't just power industries, it should power people. While everybody else is talking about tomorrow, we'll keep building today, because the progress we need can't wait for the future. >> Please welcome to the stage Lenovo's Rod Lappen! (electronic dance music) (audience applauding) >> Alright. Good morning everyone! >> Good morning. >> Ooh, that was pretty good actually, I'll give it one more shot. Good morning everyone! >> Good morning! >> Oh, that's much better! Hope everyone's had a great morning. Welcome very much to the second Lenovo Transform event here in New York. I think when I got up just now on the steps I realized there's probably one thing in common all of us have in this room including myself which is, absolutely no one has a clue what I'm going to say today. So, I'm hoping very much that we get through this thing very quickly and crisply. I love this town, love New York, and you're going to hear us talk a little bit about New York as we get through here, but just before we get started I'm going to ask anyone who's standing up the back, there are plenty of seats down here, and down here on the right hand side, I think he called it house left is the professional way of calling it, but these steps to my right, your left, get up here, let's get you all seated down so that you can actually sit down during the keynote session for us. Last year we had our very first Lenovo Transform. We had about 400 people. It was here in New York, fantastic event, today, over 1,000 people. We have over 62 different technology demonstrations and about 15 breakout sessions, which I'll talk you through a little bit later on as well, so it's a much bigger event. Next year we're definitely going to be shooting for over 2,000 people as Lenovo really transforms and starts to address a lot of the technology that our commercial customers are really looking for. We were however hampered last year by a storm, I don't know if those of you who were with us last year will remember, we had a storm on the evening before Transform last year in New York, and obviously the day that it actually occurred, and we had lots of logistics. Our media people from AMIA were coming in. They took the, the plane was circling around New York for a long time, and Kamran Amini, our General Manager of our Data Center Infrastructure Group, probably one of our largest groups in the Lenovo DCG business, took 17 hours to get from Raleigh, North Carolina to New York, 17 hours, I think it takes seven or eight hours to drive. Took him 17 hours by plane to get here. And then of course this year, we have Florence. And so, obviously the hurricane Florence down there in the Carolinas right now, we tried to help, but still Kamran has made it today. Unfortunately, very tragically, we were hoping he wouldn't, but he's here today to do a big presentation a little bit later on as well. However, I do want to say, obviously, Florence is a very serious tragedy and we have to take it very serious. We got, our headquarters is in Raleigh, North Carolina. While it looks like the hurricane is just missing it's heading a little bit southeast, all of our thoughts and prayers and well wishes are obviously with everyone in the Carolinas on behalf of Lenovo, everyone at our headquarters, everyone throughout the Carolinas, we want to make sure everyone stays safe and out of harm's way. We have a great mixture today in the crowd of all customers, partners, industry analysts, media, as well as our financial analysts from all around the world. There's over 30 countries represented here and people who are here to listen to both YY, Kirk, and Christian Teismann speak today. And so, it's going to be a really really exciting day, and I really appreciate everyone coming in from all around the world. So, a big round of applause for everyone whose come in. (audience applauding) We have a great agenda for you today, and it starts obviously a very consistent format which worked very successful for us last year, and that's obviously our keynote. You'll hear from YY, our CEO, talk a little bit about the vision he has in the industry and how he sees Lenovo's turned the corner and really driving some great strategy to address our customer's needs. Kirk Skaugen, our Executive Vice President of DCG, will be up talking about how we've transformed the DCG business and once again are hitting record growth ratios for our DCG business. And then you'll hear from Christian Teismann, our SVP and General Manager for our commercial business, get up and talk about everything that's going on in our IDG business. There's really exciting stuff going on there and obviously ThinkPad being the cornerstone of that I'm sure he's going to talk to us about a couple surprises in that space as well. Then we've got some great breakout sessions, I mentioned before, 15 breakout sessions, so while this keynote section goes until about 11:30, once we get through that, please go over and explore, and have a look at all of the breakout sessions. We have all of our subject matter experts from both our PC, NBG, and our DCG businesses out to showcase what we're doing as an organization to better address your needs. And then obviously we have the technology pieces that I've also spoken about, 62 different technology displays there arranged from everything IoT, 5G, NFV, everything that's really cool and hot in the industry right now is going to be on display up there, and I really encourage all of you to get up there. So, I'm going to have a quick video to show you from some of the setup yesterday on a couple of the 62 technology displays we've got on up on stage. Okay let's go, so we've got a demonstrations to show you today, one of the greats one here is the one we've done with NC State, a high-performance computing artificial intelligence demonstration of fresh produce. It's about modeling the population growth of the planet, and how we're going to supply water and food as we go forward. Whoo. Oh, that is not an apple. Okay. (woman laughs) Second one over here is really, hey Jonas, how are you? Is really around virtual reality, and how we look at one of the most amazing sites we've got, as an install on our high-performance computing practice here globally. And you can see, obviously, that this is the Barcelona supercomputer, and, where else in New York can you get access to being able to see something like that so easily? Only here at Lenovo Transform. Whoo, okay. (audience applauding) So there's two examples of some of the technology. We're really encouraging everyone in the room after the keynote to flow into that space and really get engaged, and interact with a lot of the technology we've got up there. It seems I need to also do something about my fashion, I've just realized I've worn a vest two days in a row, so I've got to work on that as well. Alright so listen, the last thing on the agenda, we've gone through the breakout sessions and the demo, tonight at four o'clock, there's about 400 of you registered to be on the cruise boat with us, the doors will open behind me. the boat is literally at the pier right behind us. You need to make sure you're on the boat for 4:00 p.m. this evening. Outside of that, I want everyone to have a great time today, really enjoy the experience, make it as experiential as you possibly can, get out there and really get in and touch the technology. There's some really cool AI displays up there for us all to get involved in as well. So ladies and gentlemen, without further adieu, it gives me great pleasure to introduce to you a lover of tennis, as some of you would've heard last year at Lenovo Transform, as well as a lover of technology, Lenovo, and of course, New York City. I am obviously very pleasured to introduce to you Yang Yuanqing, our CEO, as we like to call him, YY. (audience applauding) (upbeat funky music) >> Good morning, everyone. >> Good morning. >> Thank you Rod for that introduction. Welcome to New York City. So, this is the second year in a row we host our Transform event here, because New York is indeed one of the most transformative cities in the world. Last year on this stage, I spoke about the Fourth Industrial Revolution, and our vision around the intelligent transformation, how it would fundamentally change the nature of business and the customer relationships. And why preparing for this transformation is the key for the future of our company. And in the last year I can assure you, we were being very busy doing just that, from searching and bringing global talents around the world to the way we think about every product and every investment we make. I was here in New York just a month ago to announce our fiscal year Q1 earnings, which was a good day for us. I think now the world believes it when we say Lenovo has truly turned the corner to a new phase of growth and a new phase of acceleration in executing the transformation strategy. That's clear to me is that the last few years of a purposeful disruption at Lenovo have led us to a point where we can now claim leadership of the coming intelligent transformation. People often asked me, what is the intelligent transformation? I was saying this way. This is the unlimited potential of the Fourth Industrial Revolution driven by artificial intelligence being realized, ordering a pizza through our speaker, and locking the door with a look, letting your car drive itself back to your home. This indeed reflect the power of AI, but it just the surface of it. The true impact of AI will not only make our homes smarter and offices more efficient, but we are also completely transformed every value chip in every industry. However, to realize these amazing possibilities, we will need a structure built around the key components, and one that touches every part of all our lives. First of all, explosions in new technology always lead to new structures. This has happened many times before. In the early 20th century, thousands of companies provided a telephone service. City streets across the US looked like this, and now bundles of a microscopic fiber running from city to city bring the world closer together. Here's what a driving was like in the US, up until 1950s. Good luck finding your way. (audience laughs) And today, millions of vehicles are organized and routed daily, making the world more efficient. Structure is vital, from fiber cables and the interstate highways, to our cells bounded together to create humans. Thankfully the structure for intelligent transformation has emerged, and it is just as revolutionary. What does this new structure look like? We believe there are three key building blocks, data, computing power, and algorithms. Ever wondered what is it behind intelligent transformation? What is fueling this miracle of human possibility? Data. As the Internet becomes ubiquitous, not only PCs, mobile phones, have come online and been generating data. Today it is the cameras in this room, the climate controls in our offices, or the smart displays in our kitchens at home. The number of smart devices worldwide will reach over 20 billion in 2020, more than double the number in 2017. These devices and the sensors are connected and generating massive amount of data. By 2020, the amount of data generated will be 57 times more than all the grains of sand on Earth. This data will not only make devices smarter, but will also fuel the intelligence of our homes, offices, and entire industries. Then we need engines to turn the fuel into power, and the engine is actually the computing power. Last but not least the advanced algorithms combined with Big Data technology and industry know how will form vertical industrial intelligence and produce valuable insights for every value chain in every industry. When these three building blocks all come together, it will change the world. At Lenovo, we have each of these elements of intelligent transformations in a single place. We have built our business around the new structure of intelligent transformation, especially with mobile and the data center now firmly part of our business. I'm often asked why did you acquire these businesses? Why has a Lenovo gone into so many fields? People ask the same questions of the companies that become the leaders of the information technology revolution, or the third industrial transformation. They were the companies that saw the future and what the future required, and I believe Lenovo is the company today. From largest portfolio of devices in the world, leadership in the data center field, to the algorithm-powered intelligent vertical solutions, and not to mention the strong partnership Lenovo has built over decades. We are the only company that can unify all these essential assets and deliver end to end solutions. Let's look at each part. We now understand the important importance data plays as fuel in intelligent transformation. Hundreds of billions of devices and smart IoTs in the world are generating better and powering the intelligence. Who makes these devices in large volume and variety? Who puts these devices into people's home, offices, manufacturing lines, and in their hands? Lenovo definitely has the front row seats here. We are number one in PCs and tablets. We also produces smart phones, smart speakers, smart displays. AR/VR headsets, as well as commercial IoTs. All of these smart devices, or smart IoTs are linked to each other and to the cloud. In fact, we have more than 20 manufacturing facilities in China, US, Brazil, Japan, India, Mexico, Germany, and more, producing various devices around the clock. We actually make four devices every second, and 37 motherboards every minute. So, this factory located in my hometown, Hu-fi, China, is actually the largest laptop factory in the world, with more than three million square feet. So, this is as big as 42 soccer fields. Our scale and the larger portfolio of devices gives us access to massive amount of data, which very few companies can say. So, why is the ability to scale so critical? Let's look again at our example from before. The early days of telephone, dozens of service providers but only a few companies could survive consolidation and become the leader. The same was true for the third Industrial Revolution. Only a few companies could scale, only a few could survive to lead. Now the building blocks of the next revolution are locking into place. The (mumbles) will go to those who can operate at the scale. So, who could foresee the total integration of cloud, network, and the device, need to deliver intelligent transformation. Lenovo is that company. We are ready to scale. Next, our computing power. Computing power is provided in two ways. On one hand, the modern supercomputers are providing the brute force to quickly analyze the massive data like never before. On the other hand the cloud computing data centers with the server storage networking capabilities, and any computing IoT's, gateways, and miniservers are making computing available everywhere. Did you know, Lenovo is number one provider of super computers worldwide? 170 of the top 500 supercomputers, run on Lenovo. We hold 89 World Records in key workloads. We are number one in x86 server reliability for five years running, according to ITIC. a respected provider of industry research. We are also the fastest growing provider of hyperscale public cloud, hyper-converged and aggressively growing in edge computing. cur-ges target, we are expand on this point soon. And finally to run these individual nodes into our symphony, we must transform the data and utilize the computing power with advanced algorithms. Manufactured, industry maintenance, healthcare, education, retail, and more, so many industries are on the edge of intelligent transformation to improve efficiency and provide the better products and services. We are creating advanced algorithms and the big data tools combined with industry know-how to provide intelligent vertical solutions for several industries. In fact, we studied at Lenovo first. Our IT and research teams partnered with our global supply chain to develop an AI that improved our demand forecasting accuracy. Beyond managing our own supply chain we have offered our deep learning supply focused solution to other manufacturing companies to improve their efficiency. In the best case, we have improved the demand, focused the accuracy by 30 points to nearly 90 percent, for Baosteel, the largest of steel manufacturer in China, covering the world as well. Led by Lenovo research, we launched the industry-leading commercial ready AR headset, DaystAR, partnering with companies like the ones in this room. This technology is being used to revolutionize the way companies service utility, and even our jet engines. Using our workstations, servers, and award-winning imaging processing algorithms, we have partnered with hospitals to process complex CT scan data in minutes. So, this enable the doctors to more successfully detect the tumors, and it increases the success rate of cancer diagnosis all around the world. We are also piloting our smart IoT driven warehouse solution with one of the world's largest retail companies to greatly improve the efficiency. So, the opportunities are endless. This is where Lenovo will truly shine. When we combine the industry know-how of our customers with our end-to-end technology offerings, our intelligent vertical solutions like this are growing, which Kirk and Christian will share more. Now, what will drive this transformation even faster? The speed at which our networks operate, specifically 5G. You may know that Lenovo just launched the first-ever 5G smartphone, our Moto Z3, with the new 5G Moto model. We are partnering with multiple major network providers like Verizon, China Mobile. With the 5G model scheduled to ship early next year, we will be the first company to provide a 5G mobile experience to any users, customers. This is amazing innovation. You don't have to buy a new phone, just the 5G clip on. What can I say, except wow. (audience laughs) 5G is 10 times the fast faster than 4G. Its download speed will transform how people engage with the world, driverless car, new types of smart wearables, gaming, home security, industrial intelligence, all will be transformed. Finally, accelerating with partners, as ready as we are at Lenovo, we need partners to unlock our full potential, partners here to create with us the edge of the intelligent transformation. The opportunities of intelligent transformation are too profound, the scale is too vast. No company can drive it alone fully. We are eager to collaborate with all partners that can help bring our vision to life. We are dedicated to open partnerships, dedicated to cross-border collaboration, unify the standards, share the advantage, and market the synergies. We partner with the biggest names in the industry, Intel, Microsoft, AMD, Qualcomm, Google, Amazon, and Disney. We also find and partner with the smaller innovators as well. We're building the ultimate partner experience, open, shared, collaborative, diverse. So, everything is in place for intelligent transformation on a global scale. Smart devices are everywhere, the infrastructure is in place, networks are accelerating, and the industries demand to be more intelligent, and Lenovo is at the center of it all. We are helping to drive change with the hundreds of companies, companies just like yours, every day. We are your partner for intelligent transformation. Transformation never stops. This is what you will hear from Kirk, including details about Lenovo NetApp global partnership we just announced this morning. We've made the investments in every single aspect of the technology. We have the end-to-end resources to meet your end-to-end needs. As you attend the breakout session this afternoon, I hope you see for yourself how much Lenovo has transformed as a company this past year, and how we truly are delivering a future of intelligent transformation. Now, let me invite to the stage Kirk Skaugen, our president of Data Center growth to tell you about the exciting transformation happening in the global Data C enter market. Thank you. (audience applauding) (upbeat music) >> Well, good morning. >> Good morning. >> Good morning! >> Good morning! >> Excellent, well, I'm pleased to be here this morning to talk about how we're transforming the Data Center and taking you as our customers through your own intelligent transformation journey. Last year I stood up here at Transform 1.0, and we were proud to announce the largest Data Center portfolio in Lenovo's history, so I thought I'd start today and talk about the portfolio and the progress that we've made over the last year, and the strategies that we have going forward in phase 2.0 of Lenovo's transformation to be one of the largest data center companies in the world. We had an audacious vision that we talked about last year, and that is to be the most trusted data center provider in the world, empowering customers through the new IT, intelligent transformation. And now as the world's largest supercomputer provider, giving something back to humanity, is very important this week with the hurricanes now hitting North Carolina's coast, but we take this most trusted aspect very seriously, whether it's delivering the highest quality products on time to you as customers with the highest levels of security, or whether it's how we partner with our channel partners and our suppliers each and every day. You know we're in a unique world where we're going from hundreds of millions of PCs, and then over the next 25 years to hundred billions of connected devices, so each and every one of you is going through this intelligent transformation journey, and in many aspects were very early in that cycle. And we're going to talk today about our role as the largest supercomputer provider, and how we're solving humanity's greatest challenges. Last year we talked about two special milestones, the 25th anniversary of ThinkPad, but also the 25th anniversary of Lenovo with our IBM heritage in x86 computing. I joined the workforce in 1992 out of college, and the IBM first personal server was launching at the same time with an OS2 operating system and a free mouse when you bought the server as a marketing campaign. (audience laughing) But what I want to be very clear today, is that the innovation engine is alive and well at Lenovo, and it's really built on the culture that we're building as a company. All of these awards at the bottom are things that we earned over the last year at Lenovo. As a Fortune now 240 company, larger than companies like Nike, or AMEX, or Coca-Cola. The one I'm probably most proud of is Forbes first list of the top 2,000 globally regarded companies. This was something where 15,000 respondents in 60 countries voted based on ethics, trustworthiness, social conduct, company as an employer, and the overall company performance, and Lenovo was ranked number 27 of 2000 companies by our peer group, but we also now one of-- (audience applauding) But we also got a perfect score in the LGBTQ Equality Index, exemplifying the diversity internally. We're number 82 in the top working companies for mothers, top working companies for fathers, top 100 companies for sustainability. If you saw that factory, it's filled with solar panels on the top of that. And now again, one of the top global brands in the world. So, innovation is built on a customer foundation of trust. We also said last year that we'd be crossing an amazing milestone. So we did, over the last 12 months ship our 20 millionth x86 server. So, thank you very much to our customers for this milestone. (audience applauding) So, let me recap some of the transformation elements that have happened over the last year. Last year I talked about a lot of brand confusion, because we had the ThinkServer brand from the legacy Lenovo, the System x, from IBM, we had acquired a number of networking companies, like BLADE Network Technologies, et cetera, et cetera. Over the last year we've been ramping based on two brand structures, ThinkAgile for next generation IT, and all of our software-defined infrastructure products and ThinkSystem as the world's highest performance, highest reliable x86 server brand, but for servers, for storage, and for networking. We have transformed every single aspect of the customer experience. A year and a half ago, we had four different global channel programs around the world. Typically we're about twice the mix to our channel partners of any of our competitors, so this was really important to fix. We now have a single global Channel program, and have technically certified over 11,000 partners to be technical experts on our product line to deliver better solutions to our customer base. Gardner recently recognized Lenovo as the 26th ranked supply chain in the world. And, that's a pretty big honor, when you're up there with Amazon and Walmart and others, but in tech, we now are in the top five supply chains. You saw the factory network from YY, and today we'll be talking about product shipping in more than 160 countries, and I know there's people here that I've met already this morning, from India, from South Africa, from Brazil and China. We announced new Premier Support services, enabling you to go directly to local language support in nine languages in 49 countries in the world, going directly to a native speaker level three support engineer. And today we have more than 10,000 support specialists supporting our products in over 160 countries. We've delivered three times the number of engineered solutions to deliver a solutions orientation, whether it's on HANA, or SQL Server, or Oracle, et cetera, and we've completely reengaged our system integrator channel. Last year we had the CIO of DXE on stage, and here we're talking about more than 175 percent growth through our system integrator channel in the last year alone as we've brought that back and really built strong relationships there. So, thank you very much for amazing work here on the customer experience. (audience applauding) We also transformed our leadership. We thought it was extremely important with a focus on diversity, to have diverse talent from the legacy IBM, the legacy Lenovo, but also outside the industry. We made about 19 executive changes in the DCG group. This is the most senior leadership team within DCG, all which are newly on board, either from our outside competitors mainly over the last year. About 50 percent of our executives were now hired internally, 50 percent externally, and 31 percent of those new executives are diverse, representing the diversity of our global customer base and gender. So welcome, and most of them you're going to be able to meet over here in the breakout sessions later today. (audience applauding) But some things haven't changed, they're just keeping getting better within Lenovo. So, last year I got up and said we were committed with the new ThinkSystem brand to be a world performance leader. You're going to see that we're sponsoring Ducati for MotoGP. You saw the Ferrari out there with Formula One. That's not a surprise. We want the Lenovo ThinkSystem and ThinkAgile brands to be synonymous with world record performance. So in the last year we've gone from 39 to 89 world records, and partners like Intel would tell you, we now have four times the number of world record workloads on Lenovo hardware than any other server company on the planet today, with more than 89 world records across HPC, Java, database, transaction processing, et cetera. And we're proud to have just brought on Doug Fisher from Intel Corporation who had about 10-17,000 people on any given year working for him in workload optimizations across all of our software. It's just another testament to the leadership team we're bringing in to keep focusing on world-class performance software and solutions. We also per ITIC, are the number one now in x86 server reliability five years running. So, this is a survey where CIOs are in a blind survey asked to submit their reliability of their uptime on their x86 server equipment over the last 365 days. And you can see from 2016 to 2017 the downtime, there was over four hours as noted by the 750 CXOs in more than 20 countries is about one percent for the Lenovo products, and is getting worse generation from generation as we went from Broadwell to Pearlie. So we're taking our reliability, which was really paramount in the IBM System X heritage, and ensuring that we don't just recognize high performance but we recognize the highest level of reliability for mission-critical workloads. And what that translates into is that we at once again have been ranked number one in customer satisfaction from you our customers in 19 of 22 attributes, in North America in 18 of 22. This is a survey by TVR across hundreds of customers of us and our top competitors. This is the ninth consecutive study that we've been ranked number one in customer satisfaction, so we're taking this extremely seriously, and in fact YY now has increased the compensation of every single Lenovo employee. Up to 40 percent of their compensation bonus this year is going to be based on customer metrics like quality, order to ship, and things of this nature. So, we're really putting every employee focused on customer centricity this year. So, the summary on Transform 1.0 is that every aspect of what you knew about Lenovo's data center group has transformed, from the culture to the branding to dedicated sales and marketing, supply chain and quality groups, to a worldwide channel program and certifications, to new system integrator relationships, and to the new leadership team. So, rather than me just talk about it, I thought I'd share a quick video about what we've done over the last year, if you could run the video please. Turn around for a second. (epic music) (audience applauds) Okay. So, thank you to all our customers that allowed us to publicly display their logos in that video. So, what that means for you as investors, and for the investor community out there is, that our customers have responded, that this year Gardner just published that we are the fastest growing server company in the top 10, with 39 percent growth quarter-on-quarter, and 49 percent growth year-on-year. If you look at the progress we've made since the transformation the last three quarters publicly, we've grown 17 percent, then 44 percent, then 68 percent year on year in revenue, and I can tell you this quarter I'm as confident as ever in the financials around the DCG group, and it hasn't been in one area. You're going to see breakout sessions from hyperscale, software-defined, and flash, which are all growing more than a 100 percent year-on-year, supercomputing which we'll talk about shortly, now number one, and then ultimately from profitability, delivering five consecutive quarters of pre-tax profit increase, so I think, thank you very much to the customer base who's been working with us through this transformation journey. So, you're here to really hear what's next on 2.0, and that's what I'm excited to talk about today. Last year I came up with an audacious goal that we would become the largest supercomputer company on the planet by 2020, and this graph represents since the acquisition of the IBM System x business how far we were behind being the number one supercomputer. When we started we were 182 positions behind, even with the acquisition for example of SGI from HP, we've now accomplished our goal actually two years ahead of time. We're now the largest supercomputer company in the world. About one in every four supercomputers, 117 on the list, are now Lenovo computers, and you saw in the video where the universities are said, but I think what I'm most proud of is when your customers rank you as the best. So the awards at the bottom here, are actually Readers Choice from the last International Supercomputing Show where the scientific researchers on these computers ranked their vendors, and we were actually rated the number one server technology in supercomputing with our ThinkSystem SD530, and the number one storage technology with our ThinkSystem DSS-G, but more importantly what we're doing with the technology. You're going to see we won best in life sciences, best in data analytics, and best in collaboration as well, so you're going to see all of that in our breakout sessions. As you saw in the video now, 17 of the top 25 research institutions in the world are now running Lenovo supercomputers. And again coming from Raleigh and watching that hurricane come across the Atlantic, there are eight supercomputers crunching all of those models you see from Germany to Malaysia to Canada, and we're happy to have a SciNet from University of Toronto here with us in our breakout session to talk about what they're doing on climate modeling as well. But we're not stopping there. We just announced our new Neptune warm water cooling technology, which won the International Supercomputing Vendor Showdown, the first time we've won that best of show in 25 years, and we've now installed this. We're building out LRZ in Germany, the first ever warm water cooling in Peking University, at the India Space Propulsion Laboratory, at the Malaysian Weather and Meteorological Society, at Uninett, at the largest supercomputer in Norway, T-Systems, University of Birmingham. This is truly amazing technology where we're actually using water to cool the machine to deliver a significantly more energy-efficient computer. Super important, when we're looking at global warming and some of the electric bills can be millions of dollars just for one computer, and could actually power a small city just with the technology from the computer. We've built AI centers now in Morrisville, Stuttgart, Taipei, and Beijing, where customers can bring their AI workloads in with experts from Intel, from Nvidia, from our FPGA partners, to work on their workloads, and how they can best implement artificial intelligence. And we also this year launched LICO which is Lenovo Intelligent Compute Orchestrator software, and it's a software solution that simplifies the management and use of distributed clusters in both HPC and AI model development. So, what it enables you to do is take a single cluster, and run both HPC and AI workloads on it simultaneously, delivering better TCO for your environment, so check out LICO as well. A lot of the customers here and Wall Street are very excited and using it already. And we talked about solving humanity's greatest challenges. In the breakout session, you're going to have a virtual reality experience where you're going to be able to walk through what as was just ranked the world's most beautiful data center, the Barcelona Supercomputer. So, you can actually walk through one of the largest supercomputers in the world from Barcelona. You can see the work we're doing with NC State where we're going to have to grow the food supply of the world by 50 percent, and there's not enough fresh water in the world in the right places to actually make all those crops grow between now and 2055, so you're going to see the progression of how they're mapping the entire globe and the water around the world, how to build out the crop population over time using AI. You're going to see our work with Vestas is this largest supercomputer provider in the wind turbine areas, how they're working on wind energy, and then with University College London, how they're working on some of the toughest particle physics calculations in the world. So again, lots of opportunity here. Take advantage of it in the breakout sessions. Okay, let me transition to hyperscale. So in hyperscale now, we have completely transformed our business model. We are now powering six of the top 10 hyperscalers in the world, which is a significant difference from where we were two years ago. And the reason we're doing that, is we've coined a term called ODM+. We believe that hyperscalers want more procurement power than an ODM, and Lenovo is doing about $18 billion of procurement a year. They want a broader global supply chain that they can get from a local system integrator. We're more than 160 countries around the world, but they want the same world-class quality and reliability like they get from an MNC. So, what we're doing now is instead of just taking off the shelf motherboards from somewhere, we're starting with a blank sheet of paper, we're working with the customer base on customized SKUs and you can see we already are developing 33 custom solutions for the largest hyperscalers in the world. And then we're not just running notebooks through this factory where YY said, we're running 37 notebook boards a minute, we're now putting in tens and tens and tens of thousands of server board capacity per month into this same factory, so absolutely we can compete with the most aggressive ODM's in the world, but it's not just putting these things in in the motherboard side, we're also building out these systems all around the world, India, Brazil, Hungary, Mexico, China. This is an example of a new hyperscale customer we've had this last year, 34,000 servers we delivered in the first six months. The next 34,000 servers we delivered in 68 days. The next 34,000 servers we delivered in 35 days, with more than 99 percent on-time delivery to 35 data centers in 14 countries as diverse as South Africa, India, China, Brazil, et cetera. And I'm really ashamed to say it was 99.3, because we did have a forklift driver who rammed their forklift right through the middle of the one of the server racks. (audience laughing) At JFK Airport that we had to respond to, but I think this gives you a perspective of what it is to be a top five global supply chain and technology. So last year, I said we would invest significantly in IP, in joint ventures, and M and A to compete in software defined, in networking, and in storage, so I wanted to give you an update on that as well. Our newest software-defined partnership is with Cloudistics, enabling a fully composable cloud infrastructure. It's an exclusive agreement, you can see them here. I think Nag, our founder, is going to be here today, with a significant Lenovo investment in the company. So, this new ThinkAgile CP series delivers the simplicity of the public cloud, on-premise with exceptional support and a marketplace of essential enterprise applications all with a single click deployment. So simply put, we're delivering a private cloud with a premium experience. It's simple in that you need no specialists to deploy it. An IT generalist can set it up and manage it. It's agile in that you can provision dozens of workloads in minutes, and it's transformative in that you get all of the goodness of public cloud on-prem in a private cloud to unlock opportunity for use. So, we're extremely excited about the ThinkAgile CP series that's now shipping into the marketplace. Beyond that we're aggressively ramping, and we're either doubling, tripling, or quadrupling our market share as customers move from traditional server technology to software-defined technology. With Nutanix we've been public, growing about more than 150 percent year-on-year, with Nutanix as their fastest growing Nutanix partner, but today I want to set another audacious goal. I believe we cannot just be Nutanix's fastest growing partner but we can become their largest partner within two years. On Microsoft, we are already four times our market share on Azure stack of our traditional business. We were the first to launch our ThinkAgile on Broadwell and on Skylake with the Azure Stack Infrastructure. And on VMware we're about twice our market segment share. We were the first to deliver an Intel-optimized Optane-certified VSAN node. And with Optane technology, we're delivering 50 percent more VM density than any competitive SSD system in the marketplace, about 10 times lower latency, four times the performance of any SSD system out there, and Lenovo's first to market on that. And at VMworld you saw CEO Pat Gelsinger of VMware talked about project dimension, which is Edge as a service, and we're the only OEM beyond the Dell family that is participating today in project dimension. Beyond that you're going to see a number of other partnerships we have. I'm excited that we have the city of Bogota Columbia here, an eight million person city, where we announced a 3,000 camera video surveillance solution last month. With pivot three you're going to see city of Bogota in our breakout sessions. You're going to see a new partnership with Veeam around backup that's launching today. You're going to see partnerships with scale computing in IoT and hyper-converged infrastructure working on some of the largest retailers in the world. So again, everything out in the breakout session. Transitioning to storage and data management, it's been a great year for Lenovo, more than a 100 percent growth year-on-year, 2X market growth in flash arrays. IDC just reported 30 percent growth in storage, number one in price performance in the world and the best HPC storage product in the top 500 with our ThinkSystem DSS G, so strong coverage, but I'm excited today to announce for Transform 2.0 that Lenovo is launching the largest data management and storage portfolio in our 25-year data center history. (audience applauding) So a year ago, the largest server portfolio, becoming the largest fastest growing server OEM, today the largest storage portfolio, but as you saw this morning we're not doing it alone. Today Lenovo and NetApp, two global powerhouses are joining forces to deliver a multi-billion dollar global alliance in data management and storage to help customers through their intelligent transformation. As the fastest growing worldwide server leader and one of the fastest growing flash array and data management companies in the world, we're going to deliver more choice to customers than ever before, global scale that's never been seen, supply chain efficiencies, and rapidly accelerating innovation and solutions. So, let me unwrap this a little bit for you and talk about what we're announcing today. First, it's the largest portfolio in our history. You're going to see not just storage solutions launching today but a set of solution recipes from NetApp that are going to make Lenovo server and NetApp or Lenovo storage work better together. The announcement enables Lenovo to go from covering 15 percent of the global storage market to more than 90 percent of the global storage market and distribute these products in more than 160 countries around the world. So we're launching today, 10 new storage platforms, the ThinkSystem DE and ThinkSystem DM platforms. They're going to be centrally managed, so the same XClarity management that you've been using for server, you can now use across all of your storage platforms as well, and it'll be supported by the same 10,000 plus service personnel that are giving outstanding customer support to you today on the server side. And we didn't come up with this in the last month or the last quarter. We're announcing availability in ordering today and shipments tomorrow of the first products in this portfolio, so we're excited today that it's not just a future announcement but something you as customers can take advantage of immediately. (audience applauding) The second part of the announcement is we are announcing a joint venture in China. Not only will this be a multi-billion dollar global partnership, but Lenovo will be a 51 percent owner, NetApp a 49 percent owner of a new joint venture in China with the goal of becoming in the top three storage companies in the largest data and storage market in the world. We will deliver our R and D in China for China, pooling our IP and resources together, and delivering a single route to market through a complementary channel, not just in China but worldwide. And in the future I just want to tell everyone this is phase one. There is so much exciting stuff. We're going to be on the stage over the next year talking to you about around integrated solutions, next-generation technologies, and further synergies and collaborations. So, rather than just have me talk about it, I'd like to welcome to the stage our new partner NetApp and Brad Anderson who's the senior vice president and general manager of NetApp Cloud Infrastructure. (upbeat music) (audience applauding) >> Thank You Kirk. >> So Brad, we've known each other a long time. It's an exciting day. I'm going to give you the stage and allow you to say NetApp's perspective on this announcement. >> Very good, thank you very much, Kirk. Kirk and I go back to I think 1994, so hey good morning and welcome. My name is Brad Anderson. I manage the Cloud Infrastructure Group at NetApp, and I am honored and privileged to be here at Lenovo Transform, particularly today on today's announcement. Now, you've heard a lot about digital transformation about how companies have to transform their IT to compete in today's global environment. And today's announcement with the partnership between NetApp and Lenovo is what that's all about. This is the joining of two global leaders bringing innovative technology in a simplified solution to help customers modernize their IT and accelerate their global digital transformations. Drawing on the strengths of both companies, Lenovo's high performance compute world-class supply chain, and NetApp's hybrid cloud data management, hybrid flash and all flash storage solutions and products. And both companies providing our customers with the global scale for them to be able to meet their transformation goals. At NetApp, we're very excited. This is a quote from George Kurian our CEO. George spent all day yesterday with YY and Kirk, and would have been here today if it hadn't been also our shareholders meeting in California, but I want to just convey how excited we are for all across NetApp with this partnership. This is a partnership between two companies with tremendous market momentum. Kirk took you through all the amazing results that Lenovo has accomplished, number one in supercomputing, number one in performance, number one in x86 reliability, number one in x86 customers sat, number five in supply chain, really impressive and congratulations. Like Lenovo, NetApp is also on a transformation journey, from a storage company to the data authority in hybrid cloud, and we've seen some pretty impressive momentum as well. Just last week we became number one in all flash arrays worldwide, catching EMC and Dell, and we plan to keep on going by them, as we help customers modernize their their data centers with cloud connected flash. We have strategic partnerships with the largest hyperscalers to provide cloud native data services around the globe and we are having success helping our customers build their own private clouds with just, with a new disruptive hyper-converged technology that allows them to operate just like hyperscalers. These three initiatives has fueled NetApp's transformation, and has enabled our customers to change the world with data. And oh by the way, it has also fueled us to have meet or have beaten Wall Street's expectations for nine quarters in a row. These are two companies with tremendous market momentum. We are also building this partnership for long term success. We think about this as phase one and there are two important components to phase one. Kirk took you through them but let me just review them. Part one, the establishment of a multi-year commitment and a collaboration agreement to offer Lenovo branded flash products globally, and as Kurt said in 160 countries. Part two, the formation of a joint venture in PRC, People's Republic of China, that will provide long term commitment, joint product development, and increase go-to-market investment to meet the unique needs to China. Both companies will put in storage technologies and storage expertise to form an independent JV that establishes a data management company in China for China. And while we can dream about what phase two looks like, our entire focus is on making phase one incredibly successful and I'm pleased to repeat what Kirk, is that the first products are orderable and shippable this week in 160 different countries, and you will see our two companies focusing on the here and now. On our joint go to market strategy, you'll see us working together to drive strategic alignment, focused execution, strong governance, and realistic expectations and milestones. And it starts with the success of our customers and our channel partners is job one. Enabling customers to modernize their legacy IT with complete data center solutions, ensuring that our customers get the best from both companies, new offerings the fuel business success, efficiencies to reinvest in game-changing initiatives, and new solutions for new mission-critical applications like data analytics, IoT, artificial intelligence, and machine learning. Channel partners are also top of mind for both our two companies. We are committed to the success of our existing and our future channel partners. For NetApp channel partners, it is new pathways to new segments and to new customers. For Lenovo's channel partners, it is the competitive weapons that now allows you to compete and more importantly win against Dell, EMC, and HP. And the good news for both companies is that our channel partner ecosystem is highly complementary with minimal overlap. Today is the first day of a very exciting partnership, of a partnership that will better serve our customers today and will provide new opportunities to both our companies and to our partners, new products to our customers globally and in China. I am personally very excited. I will be on the board of the JV. And so, I look forward to working with you, partnering with you and serving you as we go forward, and with that, I'd like to invite Kirk back up. (audience applauding) >> Thank you. >> Thank you. >> Well, thank you, Brad. I think it's an exciting overview, and these products will be manufactured in China, in Mexico, in Hungary, and around the world, enabling this amazing supply chain we talked about to deliver in over 160 countries. So thank you Brad, thank you George, for the amazing partnership. So again, that's not all. In Transform 2.0, last year, we talked about the joint ventures that were coming. I want to give you a sneak peek at what you should expect at future Lenovo events around the world. We have this Transform in Beijing in a couple weeks. We'll then be repeating this in 20 different locations roughly around the world over the next year, and I'm excited probably more than ever about what else is coming. Let's talk about Telco 5G and network function virtualization. Today, Motorola phones are certified on 46 global networks. We launched the world's first 5G upgradable phone here in the United States with Verizon. Lenovo DCG sells to 58 telecommunication providers around the world. At Mobile World Congress in Barcelona and Shanghai, you saw China Telecom and China Mobile in the Lenovo booth, China Telecom showing a video broadband remote access server, a VBRAS, with video streaming demonstrations with 2x less jitter than they had seen before. You saw China Mobile with a virtual remote access network, a VRAN, with greater than 10 times the throughput and 10x lower latency running on Lenovo. And this year, we'll be launching a new NFV company, a software company in China for China to drive the entire NFV stack, delivering not just hardware solutions, but software solutions, and we've recently hired a new CEO. You're going to hear more about that over the next several quarters. Very exciting as we try to drive new economics into the networks to deliver these 20 billion devices. We're going to need new economics that I think Lenovo can uniquely deliver. The second on IoT and edge, we've integrated on the device side into our intelligent devices group. With everything that's going to consume electricity computes and communicates, Lenovo is in a unique position on the device side to take advantage of the communications from Motorola and being one of the largest device companies in the world. But this year, we're also going to roll out a comprehensive set of edge gateways and ruggedized industrial servers and edge servers and ISP appliances for the edge and for IoT. So look for that as well. And then lastly, as a service, you're going to see Lenovo delivering hardware as a service, device as a service, infrastructure as a service, software as a service, and hardware as a service, not just as a glorified leasing contract, but with IP, we've developed true flexible metering capability that enables you to scale up and scale down freely and paying strictly based on usage, and we'll be having those announcements within this fiscal year. So Transform 2.0, lots to talk about, NetApp the big news of the day, but a lot more to come over the next year from the Data Center group. So in summary, I'm excited that we have a lot of customers that are going to be on stage with us that you saw in the video. Lots of testimonials so that you can talk to colleagues of yourself. Alamos Gold from Canada, a Canadian gold producer, Caligo for data optimization and privacy, SciNet, the largest supercomputer we've ever put into North America, and the largest in Canada at the University of Toronto will be here talking about climate change. City of Bogota again with our hyper-converged solutions around smart city putting in 3,000 cameras for criminal detection, license plate detection, et cetera, and then more from a channel mid market perspective, Jerry's Foods, which is from my home state of Wisconsin, and Minnesota which has about 57 stores in the specialty foods market, and how they're leveraging our IoT solutions as well. So again, about five times the number of demos that we had last year. So in summary, first and foremost to the customers, thank you for your business. It's been a great journey and I think we're on a tremendous role. You saw from last year, we're trying to build credibility with you. After the largest server portfolio, we're now the fastest-growing server OEM per Gardner, number one in performance, number one in reliability, number one in customer satisfaction, number one in supercomputing. Today, the largest storage portfolio in our history, with the goal of becoming the fastest growing storage company in the world, top three in China, multibillion-dollar collaboration with NetApp. And the transformation is going to continue with new edge gateways, edge servers, NFV solutions, telecommunications infrastructure, and hardware as a service with dynamic metering. So thank you for your time. I've looked forward to meeting many of you over the next day. We appreciate your business, and with that, I'd like to bring up Rod Lappen to introduce our next speaker. Rod? (audience applauding) >> Thanks, boss, well done. Alright ladies and gentlemen. No real secret there. I think we've heard why I might talk about the fourth Industrial Revolution in data and exactly what's going on with that. You've heard Kirk with some amazing announcements, obviously now with our NetApp partnership, talk about 5G, NFV, cloud, artificial intelligence, I think we've hit just about all the key hot topics. It's with great pleasure that I now bring up on stage Mr. Christian Teismann, our senior vice president and general manager of commercial business for both our PCs and our IoT business, so Christian Teismann. (techno music) Here, take that. >> Thank you. I think I'll need that. >> Okay, Christian, so obviously just before we get down, you and I last year, we had a bit of a chat about being in New York. >> Exports. >> You were an expat in New York for a long time. >> That's true. >> And now, you've moved from New York. You're in Munich? >> Yep. >> How does that feel? >> Well Munich is a wonderful city, and it's a great place to live and raise kids, but you know there's no place in the world like New York. >> Right. >> And I miss it a lot, quite frankly. >> So what exactly do you miss in New York? >> Well there's a lot of things in New York that are unique, but I know you spent some time in Japan, but I still believe the best sushi in the world is still in New York City. (all laughing) >> I will beg to differ. I will beg to differ. I think Mr. Guchi-san from Softbank is here somewhere. He will get up an argue very quickly that Japan definitely has better sushi than New York. But obviously you know, it's a very very special place, and I have had sushi here, it's been fantastic. What about Munich? Anything else that you like in Munich? >> Well I mean in Munich, we have pork knuckles. >> Pork knuckles. (Christian laughing) Very similar sushi. >> What is also very fantastic, but we have the real, the real Oktoberfest in Munich, and it starts next week, mid-September, and I think it's unique in the world. So it's very special as well. >> Oktoberfest. >> Yes. >> Unfortunately, I'm not going this year, 'cause you didn't invite me, but-- (audience chuckling) How about, I think you've got a bit of a secret in relation to Oktoberfest, probably not in Munich, however. >> It's a secret, yes, but-- >> Are you going to share? >> Well I mean-- >> See how I'm putting you on the spot? >> In the 10 years, while living here in New York, I was a regular visitor of the Oktoberfest at the Lower East Side in Avenue C at Zum Schneider, where I actually met my wife, and she's German. >> Very good. So, how about a big round of applause? (audience applauding) Not so much for Christian, but more I think, obviously for his wife, who obviously had been drinking and consequently ended up with you. (all laughing) See you later, mate. >> That's the beauty about Oktoberfest, but yes. So first of all, good morning to everybody, and great to be back here in New York for a second Transform event. New York clearly is the melting pot of the world in terms of culture, nations, but also business professionals from all kind of different industries, and having this event here in New York City I believe is manifesting what we are trying to do here at Lenovo, is transform every aspect of our business and helping our customers on the journey of intelligent transformation. Last year, in our transformation on the device business, I talked about how the PC is transforming to personalized computing, and we've made a lot of progress in that journey over the last 12 months. One major change that we have made is we combined all our device business under one roof. So basically PCs, smart devices, and smart phones are now under the roof and under the intelligent device group. But from my perspective makes a lot of sense, because at the end of the day, all devices connect in the modern world into the cloud and are operating in a seamless way. But we are also moving from a device business what is mainly a hardware focus historically, more and more also into a solutions business, and I will give you during my speech a little bit of a sense of what we are trying to do, as we are trying to bring all these components closer together, and specifically also with our strengths on the data center side really build end-to-end customer solution. Ultimately, what we want to do is make our business, our customer's businesses faster, safer, and ultimately smarter as well. So I want to look a little bit back, because I really believe it's important to understand what's going on today on the device side. Many of us have still grown up with phones with terminals, ultimately getting their first desktop, their first laptop, their first mobile phone, and ultimately smartphone. Emails and internet improved our speed, how we could operate together, but still we were defined by linear technology advances. Today, the world has changed completely. Technology itself is not a limiting factor anymore. It is how we use technology going forward. The Internet is pervasive, and we are not yet there that we are always connected, but we are nearly always connected, and we are moving to the stage, that everything is getting connected all the time. Sharing experiences is the most driving force in our behavior. In our private life, sharing pictures, videos constantly, real-time around the world, with our friends and with our family, and you see the same behavior actually happening in the business life as well. Collaboration is the number-one topic if it comes down to workplace, and video and instant messaging, things that are coming from the consumer side are dominating the way we are operating in the commercial business as well. Most important beside technology, that a new generation of workforce has completely changed the way we are working. As the famous workforce the first generation of Millennials that have now fully entered in the global workforce, and the next generation, it's called Generation Z, is already starting to enter the global workforce. By 2025, 75 percent of the world's workforce will be composed out of two of these generations. Why is this so important? These two generations have been growing up using state-of-the-art IT technology during their private life, during their education, school and study, and are taking these learnings and taking these behaviors in the commercial workspace. And this is the number one force of change that we are seeing in the moment. Diverse workforces are driving this change in the IT spectrum, and for years in many of our customers' focus was their customer focus. Customer experience also in Lenovo is the most important thing, but we've realized that our own human capital is equally valuable in our customer relationships, and employee experience is becoming a very important thing for many of our customers, and equally for Lenovo as well. As you have heard YY, as we heard from YY, Lenovo is focused on intelligent transformation. What that means for us in the intelligent device business is ultimately starting with putting intelligence in all of our devices, smartify every single one of our devices, adding value to our customers, traditionally IT departments, but also focusing on their end users and building products that make their end users more productive. And as a world leader in commercial devices with more than 33 percent market share, we can solve problems been even better than any other company in the world. So, let's talk about transformation of productivity first. We are in a device-led world. Everything we do is connected. There's more interaction with devices than ever, but also with spaces who are increasingly becoming smart and intelligent. YY said it, by 2020 we have more than 20 billion connected devices in the world, and it will grow exponentially from there on. And users have unique personal choices for technology, and that's very important to recognize, and we call this concept a digital wardrobe. And it means that every single end-user in the commercial business is composing his personal wardrobe on an ongoing basis and is reconfiguring it based on the work he's doing and based where he's going and based what task he is doing. I would ask all of you to put out all the devices you're carrying in your pockets and in your bags. You will see a lot of you are using phones, tablets, laptops, but also cameras and even smartwatches. They're all different, but they have one underlying technology that is bringing it all together. Recognizing digital wardrobe dynamics is a core factor for us to put all the devices under one roof in IDG, one business group that is dedicated to end-user solutions across mobile, PC, but also software services and imaging, to emerging technologies like AR, VR, IoT, and ultimately a AI as well. A couple of years back there was a big debate around bring-your-own-device, what was called consumerization. Today consumerization does not exist anymore, because consumerization has happened into every single device we build in our commercial business. End users and commercial customers today do expect superior display performance, superior audio, microphone, voice, and touch quality, and have it all connected and working seamlessly together in an ease of use space. We are already deep in the journey of personalized computing today. But the center point of it has been for the last 25 years, the mobile PC, that we have perfected over the last 25 years, and has been the undisputed leader in mobility computing. We believe in the commercial business, the ThinkPad is still the core device of a digital wardrobe, and we continue to drive the success of the ThinkPad in the marketplace. We've sold more than 140 million over the last 26 years, and even last year we exceeded nearly 11 million units. That is about 21 ThinkPads per minute, or one Thinkpad every three seconds that we are shipping out in the market. It's the number one commercial PC in the world. It has gotten countless awards but we felt last year after Transform we need to build a step further, in really tailoring the ThinkPad towards the need of the future. So, we announced a new line of X1 Carbon and Yoga at CES the Consumer Electronics Show. And the reason is not we want to sell to consumer, but that we do recognize that a lot of CIOs and IT decision makers need to understand what consumers are really doing in terms of technology to make them successful. So, let's take a look at the video. (suspenseful music) >> When you're the number one business laptop of all time, your only competition is yourself. (wall shattering) And, that's different. Different, like resisting heat, ice, dust, and spills. Different, like sharper, brighter OLA display. The trackpoint that reinvented controls, and a carbon fiber roll cage to protect what's inside, built by an engineering and design team, doing the impossible for the last 25 years. This is the number one business laptop of all time, but it's not a laptop. It's a ThinkPad. (audience applauding) >> Thank you very much. And we are very proud that Lenovo ThinkPad has been selected as the best laptop in the world in the second year in a row. I think it's a wonderful tribute to what our engineers have been done on this one. And users do want awesome displays. They want the best possible audio, voice, and touch control, but some users they want more. What they want is super power, and I'm really proud to announce our newest member of the X1 family, and that's the X1 extreme. It's exceptionally featured. It has six core I9 intel chipset, the highest performance you get in the commercial space. It has Nvidia XTX graphic, it is a 4K UHD display with HDR with Dolby vision and Dolby Atmos Audio, two terabyte in SSD, so it is really the absolute Ferrari in terms of building high performance commercial computer. Of course it has touch and voice, but it is one thing. It has so much performance that it serves also a purpose that is not typical for commercial, and I know there's a lot of secret gamers also here in this room. So you see, by really bringing technology together in the commercial space, you're creating productivity solutions of one of a kind. But there's another category of products from a productivity perspective that is incredibly important in our commercial business, and that is the workstation business . Clearly workstations are very specifically designed computers for very advanced high-performance workloads, serving designers, architects, researchers, developers, or data analysts. And power and performance is not just about the performance itself. It has to be tailored towards the specific use case, and traditionally these products have a similar size, like a server. They are running on Intel Xeon technology, and they are equally complex to manufacture. We have now created a new category as the ultra mobile workstation, and I'm very proud that we can announce here the lightest mobile workstation in the industry. It is so powerful that it really can run AI and big data analysis. And with this performance you can go really close where you need this power, to the sensors, into the cars, or into the manufacturing places where you not only wannna read the sensors but get real-time analytics out of these sensors. To build a machine like this one you need customers who are really challenging you to the limit. and we're very happy that we had a customer who went on this journey with us, and ultimately jointly with us created this product. So, let's take a look at the video. (suspenseful music) >> My world involves pathfinding both the hardware needs to the various work sites throughout the company, and then finding an appropriate model of desktop, laptop, or workstation to match those needs. My first impressions when I first seen the ThinkPad P1 was I didn't actually believe that we could get everything that I was asked for inside something as small and light in comparison to other mobile workstations. That was one of the I can't believe this is real sort of moments for me. (engine roars) >> Well, it's better than general when you're going around in the wind tunnel, which isn't alway easy, and going on a track is not necessarily the best bet, so having a lightweight very powerful laptop is extremely useful. It can take a Xeon processor, which can support ECC from when we try to load a full car, and when we're analyzing live simulation results. through and RCFT post processor or example. It needs a pretty powerful machine. >> It's come a long way to be able to deliver this. I hate to use the word game changer, but it is that for us. >> Aston Martin has got a lot of different projects going. There's some pretty exciting projects and a pretty versatile range coming out. Having Lenovo as a partner is certainly going to ensure that future. (engine roars) (audience applauds) >> So, don't you think the Aston Martin design and the ThinkPad design fit very well together? (audience laughs) So if Q, would get a new laptop, I think you would get a ThinkPad X P1. So, I want to switch gears a little bit, and go into something in terms of productivity that is not necessarily on top of the mind or every end user but I believe it's on top of the mind of every C-level executive and of every CEO. Security is the number one threat in terms of potential risk in your business and the cost of cybersecurity is estimated by 2020 around six trillion dollars. That's more than the GDP of Japan and we've seen a significant amount of data breach incidents already this years. Now, they're threatening to take companies out of business and that are threatening companies to lose a huge amount of sensitive customer data or internal data. At Lenovo, we are taking security very, very seriously, and we run a very deep analysis, around our own security capabilities in the products that we are building. And we are announcing today a new brand under the Think umbrella that is called ThinkShield. Our goal is to build the world's most secure PC, and ultimately the most secure devices in the industry. And when we looked at this end-to-end, there is no silver bullet around security. You have to go through every aspect where security breaches can potentially happen. That is why we have changed the whole organization, how we look at security in our device business, and really have it grouped under one complete ecosystem of solutions, Security is always something where you constantly are getting challenged with the next potential breach the next potential technology flaw. As we keep innovating and as we keep integrating, a lot of our partners' software and hardware components into our products. So for us, it's really very important that we partner with companies like Intel, Microsoft, Coronet, Absolute, and many others to really as an example to drive full encryption on all the data seamlessly, to have multi-factor authentication to protect your users' identity, to protect you in unsecured Wi-Fi locations, or even simple things like innovation on the device itself, to and an example protect the camera, against usage with a little thing like a thinkShutter that you can shut off the camera. SO what I want to show you here, is this is the full portfolio of ThinkShield that we are announcing today. This is clearly not something I can even read to you today, but I believe it shows you the breadth of security management that we are announcing today. There are four key pillars in managing security end-to-end. The first one is your data, and this has a lot of aspects around the hardware and the software itself. The second is identity. The third is the security around online, and ultimately the device itself. So, there is a breakout on security and ThinkShield today, available in the afternoon, and encourage you to really take a deeper look at this one. The first pillar around productivity was the device, and around the device. The second major pillar that we are seeing in terms of intelligent transformation is the workspace itself. Employees of a new generation have a very different habit how they work. They split their time between travel, working remotely but if they do come in the office, they expect a very different office environment than what they've seen in the past in cubicles or small offices. They come into the office to collaborate, and they want to create ideas, and they really work in cross-functional teams, and they want to do it instantly. And what we've seen is there is a huge amount of investment that companies are doing today in reconfiguring real estate reconfiguring offices. And most of these kind of things are moving to a digital platform. And what we are doing, is we want to build an entire set of solutions that are just focused on making the workspace more productive for remote workforce, and to create technology that allow people to work anywhere and connect instantly. And the core of this is that we need to be, the productivity of the employee as high as possible, and make it for him as easy as possible to use these kind of technologies. Last year in Transform, I announced that we will enter the smart office space. By the end of last year, we brought the first product into the market. It's called the Hub 500. It's already deployed in thousands of our customers, and it's uniquely focused on Microsoft Skype for Business, and making meeting instantly happen. And the product is very successful in the market. What we are announcing today is the next generation of this product, what is the Hub 700, what has a fantastic audio quality. It has far few microphones, and it is usable in small office environment, as well as in major conference rooms, but the most important part of this new announcement is that we are also announcing a software platform, and this software platform allows you to run multiple video conferencing software solutions on the same platform. Many of you may have standardized for one software solution or for another one, but as you are moving in a world of collaborating instantly with partners, customers, suppliers, you always will face multiple software standards in your company, and Lenovo is uniquely positioned but providing a middleware platform for the device to really enable multiple of these UX interfaces. And there's more to come and we will add additional UX interfaces on an ongoing base, based on our customer requirements. But this software does not only help to create a better experience and a higher productivity in the conference room or the huddle room itself. It really will allow you ultimately to manage all your conference rooms in the company in one instance. And you can run AI technologies around how to increase productivity utilization of your entire conference room ecosystem in your company. You will see a lot more devices coming from the node in this space, around intelligent screens, cameras, and so on, and so on. The idea is really that Lenovo will become a core provider in the whole movement into the smart office space. But it's great if you have hardware and software that is really supporting the approach of modern IT, but one component that Kirk also mentioned is absolutely critical, that we are providing this to you in an as a service approach. Get it what you want, when you need it, and pay it in the amount that you're really using it. And within UIT there is also I think a new philosophy around IT management, where you're much more focused on the value that you are consuming instead of investing into technology. We are launched as a service two years back and we already have a significant number of customers running PC as a service, but we believe as a service will stretch far more than just the PC device. It will go into categories like smart office. It might go even into categories like phone, and it will definitely go also in categories like storage and server in terms of capacity management. I want to highlight three offerings that we are also displaying today that are sort of building blocks in terms of how we really run as a service. The first one is that we collaborated intensively over the last year with Microsoft to be the launch pilot for their Autopilot offering, basically deploying images easily in the same approach like you would deploy a new phone on the network. The purpose really is to make new imaging and enabling new PC as seamless as it's used to be in the phone industry, and we have a complete set of offerings, and already a significant number customers have deployed Autopilot with Lenovo. The second major offering is Premier Support, like in the in the server business, where Premier Support is absolutely critical to run critical infrastructure, we see a lot of our customers do want to have Premier Support for their end users, so they can be back into work basically instantly, and that you have the highest possible instant repair on every single device. And then finally we have a significant amount of time invested into understanding how the software as a service really can get into one philosophy. And many of you already are consuming software as a service in many different contracts from many different vendors, but what we've created is one platform that really can manage this all together. All these things are the foundation for a device as a service offering that really can manage this end-to-end. So, implementing an intelligent workplace can be really a daunting prospect depending on where you're starting from, and how big your company ultimately is. But how do you manage the transformation of technology workspace if you're present in 50 or more countries and you run an infrastructure for more than 100,000 people? Michelin, famous for their tires, infamous for their Michelin star restaurant rating, especially in New York, and instantly recognizable by the Michelin Man, has just doing that. Please welcome with me Damon McIntyre from Michelin to talk to us about the challenges and transforming collaboration and productivity. (audience applauding) (electronic dance music) Thank you, David. >> Thank you, thank you very much. >> We on? >> So, how do you feel here? >> Well good, I want to thank you first of all for your partnership and the devices you create that helped us design, manufacture, and distribute the best tire in the world, okay? I just had to say it and put out there, alright. And I was wondering, were those Michelin tires on that Aston Martin? >> I'm pretty sure there is no other tire that would fit to that. >> Yeah, no, thank you, thank you again, and thank you for the introduction. >> So, when we talk about the transformation happening really in the workplace, the most tangible transformation that you actually see is the drastic change that companies are doing physically. They're breaking down walls. They're removing cubes, and they're moving to flexible layouts, new desks, new huddle rooms, open spaces, but the underlying technology for that is clearly not so visible very often. So, tell us about Michelin's strategy, and the technology you are deploying to really enable this corporation. >> So we, so let me give a little bit a history about the company to understand the daunting tasks that we had before us. So we have over 114,000 people in the company under 170 nationalities, okay? If you go to the corporate office in France, it's Clermont. It's about 3,000 executives and directors, and what have you in the marketing, sales, all the way up to the chain of the global CIO, right? Inside of the Americas, we merged in Americas about three years ago. Now we have the Americas zone. There's about 28,000 employees across the Americas, so it's really, it's really hard in a lot of cases. You start looking at the different areas that you lose time, and you lose you know, your productivity and what have you, so there, it's when we looked at different aspects of how we were going to manage the meeting rooms, right? because we have opened up our areas of workspace, our CIO, CEOs in our zones will no longer have an office. They'll sit out in front of everybody else and mingle with the crowd. So, how do you take those spaces that were originally used by an individual but now turn them into like meeting rooms? So, we went through a large process, and looked at the Hub 500, and that really met our needs, because at the end of the day what we noticed was, it was it was just it just worked, okay? We've just added it to the catalog, so we're going to be deploying it very soon, and I just want to again point that I know everybody struggles with this, and if you look at all the minutes that you lose in starting up a meeting, and we know you know what I'm talking about when I say this, it equates to many many many dollars, okay? And so at the end the day, this product helps us to be more efficient in starting up the meeting, and more productive during the meeting. >> Okay, it's very good to hear. Another major trend we are seeing in IT departments is taking a more hands-off approach to hardware. We're seeing new technologies enable IT to create a more efficient model, how IT gets hardware in the hands of end-users, and how they are ultimately supporting themselves. So what's your strategy around the lifecycle management of the devices? >> So yeah you mentioned, again, we'll go back to the 114,000 employees in the company, right? You imagine looking at all the devices we use. I'm not going to get into the number of devices we have, but we have a set number that we use, and we have to go through a process of deploying these devices, which we right now service our own image. We build our images, we service them through our help desk and all that process, and we go through it. If you imagine deploying 25,000 PCs in a year, okay? The time and the daunting task that's behind all that, you can probably add up to 20 or 30 people just full-time doing that, okay? So, with partnering with Lenovo and their excellent technology, their technical teams, and putting together the whole process of how we do imaging, it now lifts that burden off of our folks, and it shifts it into a more automated process through the cloud, okay? And, it's with the Autopilot on the end of the project, we'll have Autopilot fully engaged, but what I really appreciate is how Lenovo really, really kind of got with us, and partnered with us for the whole process. I mean it wasn't just a partner between Michelin and Lenovo. Microsoft was also partnered during that whole process, and it really was a good project that we put together, and we hope to have something in a full production mode next year for sure. >> So, David thank you very, very much to be here with us on stage. What I really want to say, customers like you, who are always challenging us on every single aspect of our capabilities really do make the big difference for us to get better every single day and we really appreciate the partnership. >> Yeah, and I would like to say this is that I am, I'm doing what he's exactly said he just said. I am challenging Lenovo to show us how we can innovate in our work space with your devices, right? That's a challenge, and it's going to be starting up next year for sure. We've done some in the past, but I'm really going to challenge you, and my whole aspect about how to do that is bring you into our workspace. Show you how we make how we go through the process of making tires and all that process, and how we distribute those tires, so you can brainstorm, come back to the table and say, here's a device that can do exactly what you're doing right now, better, more efficient, and save money, so thank you. >> Thank you very much, David. (audience applauding) Well it's sometimes really refreshing to get a very challenging customers feedback. And you know, we will continue to grow this business together, and I'm very confident that your challenge will ultimately help to make our products even more seamless together. So, as we now covered productivity and how we are really improving our devices itself, and the transformation around the workplace, there is one pillar left I want to talk about, and that's really, how do we make businesses smarter than ever? What that really means is, that we are on a journey on trying to understand our customer's business, deeper than ever, understanding our customer's processes even better than ever, and trying to understand how we can help our customers to become more competitive by injecting state-of-the-art technology in this intelligent transformation process, into core processes. But this cannot be done without talking about a fundamental and that is the journey towards 5G. I really believe that 5G is changing everything the way we are operating devices today, because they will be connected in a way like it has never done before. YY talked about you know, 20 times 10 times the amount of performance. There are other studies that talk about even 200 times the performance, how you can use these devices. What it will lead to ultimately is that we will build devices that will be always connected to the cloud. And, we are preparing for this, and Kirk already talked about, and how many operators in the world we already present with our Moto phones, with how many Telcos we are working already on the backend, and we are working on the device side on integrating 5G basically into every single one of our product in the future. One of the areas that will benefit hugely from always connected is the world of virtual reality and augmented reality. And I'm going to pick here one example, and that is that we have created a commercial VR solution for classrooms and education, and basically using consumer type of product like our Mirage Solo with Daydream and put a solution around this one that enables teachers and schools to use these products in the classroom experience. So, students now can have immersive learning. They can studying sciences. They can look at environmental issues. They can exploring their careers, or they can even taking a tour in the next college they're going to go after this one. And no matter what grade level, this is how people will continue to learn in the future. It's quite a departure from the old world of textbooks. In our area that we are looking is IoT, And as YY already elaborated, we are clearly learning from our own processes around how we improve our supply chain and manufacturing and how we improve also retail experience and warehousing, and we are working with some of the largest companies in the world on pilots, on deploying IoT solutions to make their businesses, their processes, and their businesses, you know, more competitive, and some of them you can see in the demo environment. Lenovo itself already is managing 55 million devices in an IoT fashion connecting to our own cloud, and constantly improving the experience by learning from the behavior of these devices in an IoT way, and we are collecting significant amount of data to really improve the performance of these systems and our future generations of products on a ongoing base. We have a very strong partnership with a company called ADLINK from Taiwan that is one of the leading manufacturers of manufacturing PC and hardened devices to create solutions on the IoT platform. The next area that we are very actively investing in is commercial augmented reality. I believe augmented reality has by far more opportunity in commercial than virtual reality, because it has the potential to ultimately improve every single business process of commercial customers. Imagine in the future how complex surgeries can be simplified by basically having real-time augmented reality information about the surgery, by having people connecting into a virtual surgery, and supporting the surgery around the world. Visit a furniture store in the future and see how this furniture looks in your home instantly. Doing some maintenance on some devices yourself by just calling the company and getting an online manual into an augmented reality device. Lenovo is exploring all kinds of possibilities, and you will see a solution very soon from Lenovo. Early when we talked about smart office, I talked about the importance of creating a software platform that really run all these use cases for a smart office. We are creating a similar platform for augmented reality where companies can develop and run all their argumented reality use cases. So you will see that early in 2019 we will announce an augmented reality device, as well as an augmented reality platform. So, I know you're very interested on what exactly we are rolling out, so we will have a first prototype view available there. It's still a codename project on the horizon, and we will announce it ultimately in 2019, but I think it's good for you to take a look what we are doing here. So, I just wanted to give you a peek on what we are working beyond smart office and the device productivity in terms of really how we make businesses smarter. It's really about increasing productivity, providing you the most secure solutions, increase workplace collaboration, increase IT efficiency, using new computing devices and software and services to make business smarter in the future. There's no other company that will enable to offer what we do in commercial. No company has the breadth of commercial devices, software solutions, and the same data center capabilities, and no other company can do more for your intelligent transformation than Lenovo. Thank you very much. (audience applauding) >> Thanks mate, give me that. I need that. Alright, ladies and gentlemen, we are done. So firstly, I've got a couple of little housekeeping pieces at the end of this and then we can go straight into going and experiencing some of the technology we've got on the left-hand side of the room here. So, I want to thank Christian obviously. Christian, awesome as always, some great announcements there. I love the P1. I actually like the Aston Martin a little bit better, but I'll take either if you want to give me one for free. I'll take it. We heard from YY obviously about the industry and how the the fourth Industrial Revolution is impacting us all from a digital transformation perspective, and obviously Kirk on DCG, the great NetApp announcement, which is going to be really exciting, actually that Twitter and some of the social media panels are absolutely going crazy, so it's good to see that the industry is really taking some impact. Some of the publications are really great, so thank you for the media who are obviously in the room publishing right no. But now, I really want to say it's all of your turn. So, all of you up the back there who are having coffee, it's your turn now. I want everyone who's sitting down here after this event move into there, and really take advantage of the 15 breakouts that we've got set there. There are four breakout sessions from a time perspective. I want to try and get you all out there at least to use up three of them and use your fourth one to get out and actually experience some of the technology. So, you've got four breakout sessions. A lot of the breakout sessions are actually done twice. If you have not downloaded the app, please download the app so you can actually see what time things are going on and make sure you're registering correctly. There's a lot of great experience of stuff out there for you to go do. I've got one quick video to show you on some of the technology we've got and then we're about to close. Alright, here we are acting crazy. Now, you can see obviously, artificial intelligence machine learning in the browser. God, I hate that dance, I'm not a Millenial at all. It's effectively going to be implemented by healthcare. I want you to come around and test that out. Look at these two guys. This looks like a Lenovo management meeting to be honest with you. These two guys are actually concentrating, using their brain power to race each others in cars. You got to come past and give that a try. Give that a try obviously. Fantastic event here, lots of technology for you to experience, and great partners that have been involved as well. And so, from a Lenovo perspective, we've had some great alliance partners contribute, including obviously our number one partner, Intel, who's been a really big loyal contributor to us, and been a real part of our success here at Transform. Excellent, so please, you've just seen a little bit of tech out there that you can go and play with. I really want you, I mean go put on those black things, like Scott Hawkins our chief marketing officer from Lenovo's DCG business was doing and racing around this little car with his concentration not using his hands. He said it's really good actually, but as soon as someone comes up to speak to him, his car stops, so you got to try and do better. You got to try and prove if you can multitask or not. Get up there and concentrate and talk at the same time. 62 different breakouts up there. I'm not going to go into too much detai, but you can see we've got a very, very unusual numbering system, 18 to 18.8. I think over here we've got a 4849. There's a 4114. And then up here we've got a 46.1 and a 46.2. So, you need the decoder ring to be able to understand it. Get over there have a lot of fun. Remember the boat leaves today at 4:00 o'clock, right behind us at the pier right behind us here. There's 400 of us registered. Go onto the app and let us know if there's more people coming. It's going to be a great event out there on the Hudson River. Ladies and gentlemen that is the end of your keynote. I want to thank you all for being patient and thank all of our speakers today. Have a great have a great day, thank you very much. 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