(upbeat music) >> Welcome back to theCUBE's live coverage of AWS re:Invent. Friends, it's good to see you. Lisa Martin here with Dave Vellante. This is our fourth day of CUBE wall-to-wall coverage, Dave. I can't believe it. And the expo hall is still going incredibly strong. >> Yeah, it is. It feels like the biggest re:Invent ever. I'm told it's almost as big as 2019. I don't know, maybe I was half asleep at 2019. That's very possible. But I'm excited because in 2017 Andy Jassy came on theCUBE and he said if Amazon had to do it all over again, if it knew then what it had now, we would've done the whole thing in containers or using Lambda, using serverless and using containers. Didn't have that opportunity back then. And I'm excited 'cause Rafay Systems is someone we've worked with a lot as an innovator in this space. >> Yep, and we're going to be talking with Rafay again. I think it's your 10th time Haseeb on the show >> Like once or twice. >> And a great customer who's going to talk about their serverless journey. Haseeb Budhani joins us once again, the CEO of Rafay. Great to see you. Rakesh Singh is here as well, the Head of Cloud and DevOps at Regeneron. Guys, it's great to have you on the program. How you feeling on day four of re:Invent? >> Excitement is as high as ever basically. >> Isn't it amazing? >> Rakesh: That's true. >> Haseeb: I just need some sleep. >> I'm with you on that. Caffeine and sleep. >> So many parties. So many meetings, oh my God. >> But the great thing is, Haseeb, that people want to engage with you. They're loving what Rafay is doing. You guys are a great testament to that, which we're going to uncover on the show. What are some of the things that you're hearing in the booth from customers? What's been some of the feedback? >> So firstly, as I said, it feels like the biggest one ever. I've been coming to re:Invent a long time and I mean, I know the numbers say it's not, but oh my God, this is a lot of people. Every time we've spoken over the last year and the point I always make to you, and we've spoken enough time about this is that enterprises are truly adopting this idea of Kubernetes containers, serverless, et cetera. And they're all trying to figure out what is the enterprise strategy for these things? They're thinking beyond technology and thinking operationalization of these technologies. And that's not the same thing. There's a toy and then there's the real thing. And that's not the same thing. And that's the gap that every enterprise customer I talked to and the booth traffic has been just amazing. I mean, but coming here I was thinking, my God, this is really expensive. And I'm thinking, wow, this is a great investment. Because we met such amazing companies who all essentially are saying exactly the same thing, which is as we go and productize and bring our high value applications to the modern infrastructure space, like Kubernetes, Lambda, et cetera, solving for the automation governance is really, really hard because, well, at one point, I guess when the economy was doing crazy well, I could keep hiring people, but I can't do that anymore either. So they're out looking for automation strategies that allow them to do more with the teams they have. And that's exactly what Rafay is here for. >> Yeah. Lisa, Adam Selipsky in his keynote, I love the, he said, "If you want to save money, the cloud is the place to do it." >> Exactly. Yep. Let's talk about Regeneron. Everyone knows it's a household word especially over the last couple of years, but talk about, Rakesh, Regeneron as a technology company that delivers life-saving pharmaceuticals. And where does cloud and Rafay fit into your strategy? >> So cloud has been a backbone of our compute strategy within Regeneron for a very long time now. The evolution from a traditional compute structure to more serverless compute has been growing at a rapid pace. And I would say like we are seeing exponential growth within the adaption of the compute within containers and Kubernetes world. So we've been on this journey for a long time and I think it's not stopping anytime soon. So we have more and more workload, which is running on Kubernetes containers and we are looking forward to our partnership with Rafay to further enhance it, as Haseeb mentioned, the efficiency is the key. We need to do more with less. Resourcing is critical and cloud is evolved from that journey that do more things in a more efficient manner. >> That was the original catalyst as we got to help our development team, be more productive. >> That's correct. >> Eliminate the heavy lifting. And then you started presumably doing some of the less heavy, but still heavy lifting and we talked off camera and then you're increasingly moving toward serverless. >> Rakesh: That's correct. >> Can you describe that journey? What that's like? >> So I think like with the whole adoption that things are taking a much faster pace. Basically we are putting more compute onto containers and the DevOps journey is increasingly getting more, more faster. >> Go ahead. 'Cause I want to understand where Rafay sits in this whole equation. I was talking about, I'm not a developer, but I was talking to developer yesterday trying to really understand the benefits of containers and serverless and I said, take me through what you have to do when you're using containers. He said, I got to build the container image then I got to deploy an EC2 instance where I got to choose and I got to allocate memory of the fence the app in a VM then I got to run the computing instance against the app. And then, oh by the way, I got to pay 'cause all that EC2 that whole time. Depending on how you approach serverless you're going to eliminate a lot of those steps. >> That is correct. So what we do is basically like in a traditional sense, the computer is sitting idle at quite a lot basically. >> But you're paying. >> And you're still paying for that. Serverless technologies allows us to use the compute as needed basis. So whenever you need it, it is available. You run your workload on that and after that it shuts down or goes to minimal state and you don't need to pay as much as your paying. >> And then where do you guys fit in that whole equation? >> Look, serverless has a paradigm. If you step back from the idea of containers versus Lambda or whatever functions. The idea should be that the list you just read out of what developers have to do. Here's what they really should do. They should write their code, they should check it in, and they never have to think about it again. That should be the case. If they want to debug their application, there should be a nice front end where they go and they interact with their application and that's it. What is Kubernetes? I don't care. That's the right answer. And we did not start this journey as an industry there because usually the initial adopters are developers who do the heavy lifting. Developers want to learn, they want to solve these problems. But then eventually the expectation is that the platform organization and an enterprise is going to own this platform for me so I can go back to doing my job, which is writing code. And that's where Rakesh's team comes in. So Rakesh team is building the standard at Regeneron. Whether you're writing a long-lasting app, which is going to run in a container or you're going to write an event-driven application, which is going to be a function, whatever. You write your app, we will give you the necessary tooling and plumbing to take care of all these things. And this is my problem. My being Rakesh. Rakesh is my customer. He has his customers. We as Rafay, A, we have to make Rakesh's system successful because we have to give them right automation to do all these things so that he can service hundred, or in his case, thousands and thousands of different individuals. But then collectively, we have to make sure that the developer experience is optimal so that truly they just write their code and EC2, they don't want to deal with this. In fact, on Monday evening, in the Kubernetes keynote by Barry Cooks, one of the things he said was that in a CIO sort of survey they did, CIO said, 80% of the time of developers is wasted on infrastructure stuff and not on innovation. We need to bring that 80% back so that a hundred percent of the work is on innovation and today it's not. >> And that's what you do. >> That's what we do. >> In your world as a developer, I only have to worry about my writing my code and what functions I'm going to call. >> That is correct. And it is important because the efficiencies of a developer need to be focused on doing the things which business is asking for. The 80% of the work like to make sure the things are secure, they're done the right way, the standards are followed, scanning part of it, that work if we can offload to a platform, for example, Rafay, saves a lot of works, a lot of work cycles from the developers perspective. >> Thank you for that. It was nice little tutorial on the benefits. >> Absolutely. So you transform the developer experience. >> That's correct. >> How does that impact Regeneron overall business? We uplevel that. Give me that view. >> So with that, like what happens, the key thing is the developers productivity increases. We are able to do more with less. And that is the key thing to our strategy that like with the increase in business demand, with the increase in lot of compute things, which we are doing, we need to do and hiring resources is getting more difficult than ever. And we need to make sure that we are leveraging platforms and tools basically to do, enable our developers to focus on key business activity rather than doing redundant things and things which we can leverage some other tooling and platform for that business. >> Is this something in terms of improving the developer experience and their productivity faster time to market? Is this accelerating? >> That's correct. >> Is this even like accelerating drug discovery in some cases? >> So COVID is like a great example for that. Like we were able to fast track our drug discovery and like we were able to turn it into an experience where we were able to discover new drugs and get it to the market in a much faster pace. That whole process was expedited using these tools and processes basically. So we are very proud of that. >> So my understanding is you're running Rafay with EKS. A lot of choices out there. Why? Why did you choose to go in that direction? >> So Regeneron has heavily invested in cloud recently, over the years basically. And then we are focusing on hybrid cloud now that we we are like, again, these multiple cloud providers of platforms which are coming in are strategies to focus on hybrid cloud and Rafay is big leader in that particular space where we felt that we need to engage or partner with Rafay to enable those capabilities, not just on AWS, but across the board. One single tool, one single process, one single knowledge base helps us achieve more efficiencies. >> Less chaos, less complexity. >> That's correct. Let's say when you're in customer conversations, which I know you've had many this week, but you probably do that all the time. Regeneron is a great use case for Rafay. It's so tangible, life sciences. We all get that, especially coming out of the pandemic. What do you say to customers are the top three differentiators of Rafay and why they should go Rafay on top of EKS? >> What's really interesting about these conversations is that, look, we have some pretty cool features in our product. Obviously we must have something interesting otherwise nobody would buy our product. And we have access management and zero trust models and cluster provisioning, all these very nice things. But it always comes down to exactly the same thing, which is every large enterprise that started a journey, independent or Rafay because they didn't know who we were, it's fine. Last year we were a young company, now we are a larger company and they all are basically building towards a roadmap which Rafay truly understands. And in my opinion, and I'm confident when I say this, we understand their life, their journey better than any other company in the market. The reason why we have the flurry of customers we have, the reason why the product has the capacity that it does is because for whatever reason, look, it's scale lock. That's for the history books. But we have complete clarity on what a pharmaceutical company or financial customers company or a high tech company the journey they will take to the cloud and automation for modern infrastructure, we get it. And what I'm selling them is the is the why, not the what. There's a lot of great answers for the what? What do we do? Rakesh doesn't care. I mean, he's trying to solve a bigger problem. He's trying to get his researchers to go faster. So then when they want to run a model, they should be able to do it right now. That's what he cares about. Then he looks for a tool to solve the business problem. And we figured out how to have that conversation and explain why Rafay helps him, essentially multiply the bandwidth that he has in his organization. And of course to that end we have some great technology/ But that's a secondary issue, the first, to me the why is more important than the what. And then we talk about how, which he has to pay us money. That's the how. But yeah, we get there too. But look, this is the important thing. Every enterprise is on exactly the same journey, Lisa. And that if you think about it from just purely economic efficiencies perspective that is not a good investment for our industry. If everybody's solving the same problem that's a waste of resources. Let's find a way to do, what is the point of the cloud? We used to all build data centers. That was not efficient. We all went to the cloud because it's more efficient to have somebody else, AWS, solve this problem for us so we can now focus on the next level problem. And then Rafay solving that problem so that he can focus on his drug discovery, not on Kubernetes. >> That's correct. It's all about efficiencies. Like doing things, learn from each other's experience and build upon it. So the things have been solved. One way you need to leverage that, reuse it. So the principles are the same. >> So then what's next? You had done an amazing job transforming the company. You're facilitating drug discovery faster than ever before. From an infrastructure perspective, what's next on your journey? >> So right now the roadmap what we have is basically talking about making sure that the workload are running more efficient, they're more secure. As we go into these expandable serverless technology, there are more challenging opportunities for us to solve. Those challenges are coming up. We need to make sure that with the new, the world we are living in, we are more securely doing stuff what we were doing previously. More efficiencies is also the key and more distributed. Like if we can leverage the power of cloud in doing more things on demand is on our roadmap. And I think that is where we are all driving. >> And when you said hybrid, you're talking about connecting to your on-prem tools and data? How about cross cloud? >> We are invested in multiple cloud platform itself and we are looking forward to leveraging a technology, which is truly cloud native and we can leverage things together on that. >> And I presume you're helping with that, obviously. >> Last question for both of you. We're making an Instagram reel. Think of this as a sizzle reel, like a 32nd elevator pitch. Question, first one goes to you, Rakesh. If you had a bumper sticker, you put it on, I don't know, say a DeLorean, I hear those are coming back. What would it say about Regeneron as a technology company that's delivering therapeutics? >> It's a tough question, but I would try my best. The bumper sticker would say, discover drug more faster, more efficient. >> Perfect. Haseeb, question about Rafay. What's the bumper sticker? If you had a billboard in on Highway 101 in Redwood City about Rafay and what it's enabling organizations enterprises across the globe to achieve, what would it say? >> I'll tell you what our customers say. So our customers call us the vCenter for Kubernetes and we all know what a vCenter is. We all know why vCenter's so amazingly successful because it takes IT engineers and gives them superpowers. You can run a data center. What is the vCenter for this new world? It us. So vCenter is obviously a trademark with our friends at VMware, so that's why I'm, but our customers truly call us the vCenter for Kubernetes. And I think that's an incredible moniker because that truly codifies our roadmap. It codifies what we are selling today. >> There's nothing more powerful and potent in the voice of the customer. Thank you both for coming on. Thank you for sharing the Regeneron story. Great to have you back on, Haseeb. You need a pin for the number of times you've been on theCUBE. >> At least a gold star. >> We'll work on that. Guys, thank you. We appreciate your time. >> Haseeb: Thank you very much. >> For our guests and for Dave Vellante, I'm Lisa Martin. You're watching theCUBE, the leader in live enterprise and emerging tech coverage. (upbeat music)

>> Presenter: From theCUBE studios in Palo Alto in Boston, connecting with thought leaders around the globe, these are cloud native insights. >> Hi, I'm Stu Miniman, the host of Cloud Native Insights. When we launched this program, we talked about, how do we take advantage of the innovation and agility that's in the cloud? And of course, one of the big components that we've talked about for many years on theCUBE is, how do we empower developers? and developers are helping change things, and I'm really happy to welcome to the program first time guests that helped build many of the tools that developers are very well familiar. So Tom Preston Werner, he is the co-founder of Chatterbug, he is the creator of redwoodjs, we had an early episode, the JAMstack Netlify team, he's also on the board for that, and we'll talk about those pieces. People might know him, if you check him out on Wikipedia, you know, GitHub, he was one of the co-founders as well as held both CTO and CEO roles there. I could go on but Tom, thank you so much for joining us. >> Thank you for having me. >> All right, so let's start there, Tom, you know, when I live in the enterprise space, how do you take advantage of new things? One of the biggest challenges out there is, let's go to something new, but let's do it the old way. And we know that that really doesn't take advantage of it you know, I think back to the oldest, some of the older technologies, it's like, well, you know, if I talk to people that are riding horses, what do they want? You know, well, I want faster horses, not the, you know, let's completely change things. I was hearing a stat that, you know, back in the early days of cars, we had like, 30% of them were electric cars, and now it's one. So what's old is new again, but I digress. One, as I mentioned, you know, GitHub, of course, is, you know, such a fundamental piece when we look at in the technology space over the last decade, you know, get in general, GitHub, specifically, of course, has created so much value engaged, you know, just millions and millions of developers and transform businesses. Take us back a little bit and you know, like to get your philosophy on, you know, building tools, how do you do it? How do you think about it? And what's inspired you? >> Yeah, I think it goes a long way back to just wanting to build things for the community. One of the first big projects I worked on was called Gravatar, and I remember laying in bed staring at the ceiling, just trying to think up some idea that that would contribute to what we then called The Blogosphere, and I came up with an idea for avatars that would follow you around and I coded it up and I got it out to a few bloggers and they started using it, and it caught on and it was really, it really introduced me to this idea that no matter who you are, where you come from, or what your background is, you know, I grew up in Iowa, things are very different there. And with with the Internet, and the ability to code, you can impact the world in really significant ways. And so it follows on from there, and I think GitHub is an extension of that desire to really put things into the world that will be useful for people, and knowing that, if you have the ability to code and especially with the advent of web applications as a common tool, there's such power in that you have global reach, you just need a computer and the ability to code and you can create these things, and GitHub kind of became that. It was just, it started out really as a side project, and I hoped that someday it would be able to support me to work on it full time. But I, we started building it just because we wanted it to exist. And that's most of what I work on is, is just ideas that I want to exist in the world. >> Yeah, it's been one of those great trends to watch at, you know, there were certain technologies that used to have to be a nation state, or, you know, one of the one of the global 50 companies to take advantage of it. Now, tools like GitHub, making it so that, you know, the smallest company or even the individuals can participate in communities, can create and build you know, the building is such an important theme. So Maybe, let's fast forward a little bit if we would, I mentioned Netlify and JAMstack, you talked about the blogosphere, that team is helping to really reinvent how we think about the web, you know, it's real time, It's high performance, and you know, we need to be able to get that to where everybody is. So, you know, back in the early days, web pages, you know, relatively static and, you know, had certain criteria, and now, of course, you know, edge devices and the global population change things. So, you know, you, you've been engaged in a, you know, huge supporter of that project, and that'll lead us towards the redwoods discussion, but maybe bring us as to how you got involved there, and what got you excited? >> Well, like you said, Everything old is new again and I think that's true in fashion. It's also true in technology, in a lot of ways, and the JAMstack really is taking these old ideas where the web started, taking files and just serving them as static files and it's super fast, and it's extremely secure. This is how the internet started, and now we've sort of come full circle. But we've added a lot of really nice things and workflows on top of that. And so my journey into the JAMstack, I suppose, started more than a decade ago, when I started working on a project called Jekyll, that's a, I called it at the time, A Blog Aware Static Site Generator. So you would write your blog articles, and you would run it through Jekyll, and that would take your markdown, you'd write your articles in markdown, and it would combine them with a, some kind of a theme that you would have, and that would output static pages that represented your blog, and then you could serve those from any kind of static blog serving system. GitHub had has one built in called GitHub Pages, and so we ended up adopting Jekyll for GitHub Pages. So everything that you put up on GitHub Pages. would be run through Jekyll, and so it was a really natural place to put your blog. And so I had a blog post, one of my blog posts using Jekyll was called Blogging Like A Hacker. And it was this idea that you don't need WordPress, you don't need to have a database somewhere that's, that's hackable, that's going to cause you security problems, all the WordPress admin stuff that constantly is being attacked. You don't need all that, like you can just write articles in flat files, and then turn them into a blog statically and then put those up to serve them somewhere, right? And so when I say it like that, it sounds a little bit like the JAMstack, right? That's not how we thought about it at the time, because it was really hard to do dynamic things. So if you wanted to have comments on your blog for instance, then you needed to have some third party service that you would embed a component onto your blog, so you could receive comments. And so you had to start gluing things together, but even then, again, that sounds a little bit like the JAMstack. So it's all of these ideas that have been, evolving over the last decade to 15 years, that now we finally have an entire tool chain and adding Git on top of that and Git based workflows, and being able to push to GitHub and someone like Netlify can pick those up and publish them, and you have all these third party services that you can glue together without having to build them yourself. All of the billing things, like there's just the ecosystem is so much more advanced now, so many more bits are available for you to piece together that in a very short amount of time, you can have an extremely performant site capable of taking payments, and doing all of the dynamic things that we want to do. Well, many, I should say many of the dynamic things that we want to do, and it's fast and secure. So it's like the web used to be when the web started, but, now you can do all the modern things that you want to do. >> You're giving me flashbacks remembering how I glued discus into my Tumblr instance when that was rolling out. (laughing) >> That's what I was referring to, discuss. >> Yeah, so absolutely, you talk about there's just such a robust ecosystem out there, and one of the real challenges we have out there is, people will come in and they say, "Oh my gosh, where do I start?" And it's like, well, where do you want to go? There's the Paradox of Choice, and that I believe is one of the things that led you to create Redwoods. So help explain to our audience you know, you created this project Redwood, it related to JAMstack, but, but I'll let you explain you know, what it is in life needed? >> Yeah, Redwood is a response to a couple of things. One of those things, is the JavaScript world has, as everything has evolved in tremendous way, in all kinds of ways and almost entirely positive I think. The language itself has been improved so much from when I was a teenager using view source and copy pasting stuff into you know, some random X Files fan site. To now it's a first class language I can compete with with everything, from a ergonomics perspective. I really enjoy programming in it and I come from a Ruby, Ruby on Rails background and now I'm very happy in JavaScript that was not true even five, seven years ago, right? So JavaScript itself has changed a lot. Along with that comes NPM in the whole packaging universe, of availability of modules, right? So most of the things that you want to do, you can go and you can search and find code that's going to do those things for you, and so being able to, to just pull those into your projects so easily. That is amazing, right? The power that that gives you is tremendous. The problem comes in when, like you said, you have the Paradox of Choice. Now you have, not just one way to do something, but you have 100 ways to do something, right? And now as a as a developer, and especially as a new developer, someone who's just learning how to build web applications, you come into this and you say, all you see is the complexity, just overwhelming complexity, and every language goes through this. They go through a phase of sort of this Cambrian explosion of possibilities as people get excited, and you see that the web is embracing these technologies, and you see what's possible. Everyone gets excited and involved and starts creating solution after solution after solution, often times to the same problems. And that's a good thing, right, like exploring the territory is a good and necessary part of the evolution of programming languages and programming ecosystems. But there's comes a time where that becomes overwhelming and starts to trend towards being a negative. And so at Chatterbug, which is a foreign language learning service, if you want to learn how to speak French or Spanish or German, we'll help you do that, as part of that work, we started using react on the front end, because I really love what react brings you from a JavaScript and interactivity perspective. But along with react, you have to make about 50 other choices of technologies to use to actually create a fully capable website, something for state management, you got to choose a way to do JavaScript or sorry, CSS. There's 100 things that you have to choose, and it's, it seems very arbitrary and you go through a lot of churn, you choose one, and then the next day an article comes out and then people raving about another one, and then you choose, you're like, Oh, that one looks really nice. You know, grass is always greener, and so Redwood is a bit of a, an answer to that, or a response to that, which is to say, we've learned a lot of things now about what works in building with react, especially on the front end. And what I really want to do is have a tool that's more like Ruby on Rails, where I come from, having done years and years of Ruby on Rails, what GitHub was built with. And Ruby on Rails presents to you a fully capable web application framework that has made all the choices or most of the choices, many of the important choices. And the same is kind of missing in the JavaScript TypeScript world and so, when I saw Netlify come out with their feature where you could commit the code for a lambda function to your repository, and if you push that up to GitHub, Netlify will grab it, and they will orchestrate deploying that code to an AWS lambda so that you can run business logic in a lambda but without having to touch AWS, because touching AWS is another gigantic piece of complexity, and their user interfaces are sometimes challenging, I'll say. That, that then made me think that, here finally is the ability to combine everything that's awesome about the JAMstack and static files, and security, and this workflow, with the ability to do business logic, and that sounded to me like the makings of a full stack web application framework, and I kept waiting for someone to come out and be like, hey, tada, like we glued this all together, and here's your thing, that's rails, but for the JAMstack, JavaScript, TypeScript world and nobody was doing it. And so I started working on it myself, and that has become Redwoodjs. >> It's one of the things that excited me the early days when I looked into Serverless was that, that low bar to entry, you know, I didn't have to have, you know, a CS degree or five years of understanding a certain code base to be able to take advantage of it. Feels like you're hoping to extend that, it believe it's one of your passions, you know, helping with with Chatterbug and like, you know, helping people with that learning. What do you feel is the state out there? What's your thoughts about kind of the future of jobs, when it when it comes to this space? >> I think the future of jobs in technology and especially software development is, I mean, there is no, there is no better outlook for any profession than that. I mean, this is the, this is where the world is going, more and more of what we want to accomplish, we do in software and it happens across every industry. I mean, just look at Tesla's for instance, right? You think about automobiles and the car that you owned, you know, 10 years ago, and you're like, I don't know, I know there's a computer in here somewhere, but like, I don't really, you know, either the software for it is terrible, and you're like, who, when was the last time you actually use the navigation system in your car, right? You just like get like just turn that off because it's, it's so horrible. And then Tesla comes along and says, hey, what if we actually made all this stuff useful, and had a thoughtful interface and essentially built a car that where everything was controlled with software, and so now cars are are basically software wrapped in hardware, and the experience is amazing. And the same is true of everything, look at your, look at how many things that your phone has replaced that used to be physical devices. Look at manufacturing processes, look at any any element of bureaucracy, all of this stuff is mediated by computers, and oftentimes it's done badly. But this just shows how much opportunity there is speaking of like governmental websites, right, you go to the DMV, and you try to schedule an appointment, and you just have no confidence that that's going to work out because the interfaces feel like they were written 15 years ago, and sometimes I think they were, written that long ago. But there's so much, there's still so much improvement to be had and all of that is going to take developers to do it. Unless, you know, we figure out how to get AI to do it for us, and there's been some very interesting things lately around that angle, but to me, it's, humans will always be involved. And so, at some level, humans are telling machines what to do, whether you're doing it more or less directly, and having the ability to tell machines what to do gives you tremendous leverage. >> Yeah, we're big fans, if you know Erik Bryjolfsson and Andy McAfee from MIT, they've, you know, are very adamant that it's the combination of people plus machines that always will win against either people alone or machines alone. Tom, what, you know, right now we're in the middle of a global pandemic, there're financially, there's a lot of bad news around the globe right now. I've talked to many entrepreneurs that said, well, a downturn market is actually a great time to start something new. You're an investor, you've helped build lots of things. We talked a lot about lowering the bar for people to create and build new things. What do you see are some of the opportunities out there, if you know, you had to recommend for the entrepreneurs out there? Where should they be looking? >> I'd say look at all of the things in your life that have become challenging, because where there's challenge, where there's pain, there's opportunity for solutions. And especially when there's a big environmental change, which we see right now, with COVID-19, obviously has changed a lot of our behaviors and made some of the things that used to be easy. It's made those a lot harder, and so you see, certain segments of the economy are doing extremely well, namely technology and things that allow us to do interviews like this instead of in person, and so those industries are doing extremely well. So you look at the you look at the stock market in the United States, and it's it's very interesting, because while much of the country is suffering, the people that are already wealthy are doing very well, and technology companies are doing very well. And so the question for me is, what are the opportunities that we have, leveraging technology in the internet, to where we can create more opportunities for more people, to get people back to work, right? I think there's so much opportunity there. Just look at education, like the entire concept of educating kids right now and I have three. So we feel this very much, it has been turned on its head. And so we so you see many people looking for solutions in that space, and that's, I think that's as it should be. When things get, when things get challenged when our, our normal daily experience is so radically changed, there's opportunity there, because people are willing to change more quickly in a crisis, right? Because you need, you need something like any solution. And so some choice is going to be made, and where that's happening, then you can find early adopters more easily, than you can under other circumstances, and so in economic downturns, you often see that kind of behavior where these are crisis moments for people, you have an opportunity to come in and if you have something that could solve a problem for them, then you can get a user where that may have not been a problem for a person before. So where there is, where there is a crisis, there is always opportunity to help people solve their problems in different and better ways to address that crisis. So again, it goes back to pain, you know, and it doesn't have to be the pain from a crisis. It could be a pain from from anything. Just like with GitHub, it was, it was hard to share code as developers like it was, there was too much pain, and this was, we started it in 2008, right after the housing crisis. It was unrelated to that, but it turns out that when you start a company, when the economy is depressed in a certain way, then at least you can look forward to the economy getting better as you are building your company. >> Oh, Tom, Preston Werner, thank you so much for joining pleasure talking with you. I appreciate all of your input. >> Absolutely, thanks for having me. >> I'm Stu Miniman, thank you for joining this Episode of cloud native insights. Thank you for watching the theCUBE. (light music)

(upbeat music) >> Man: From San Francisco it's theCUBE covering Accenture Tech Vision 2020 (upbeat music) brought to you by Accenture. >> Hey, welcome back everybody. Jeff Frick here with theCUBE. We are high atop San Francisco. It is absolutely beautiful outside. Sun is going down, we're here for a really special event, It's the Accenture Tech Vision, kind of unveiling of the five things that we should be paying attention to as we look to 2020 the year that we're going to know everything with the benefit of hindsight. So it's pretty exciting, it's pretty exciting time. And we have a new guest, Mike Redding, he's the managing director of Accenture Ventures telling us where the Accenture Ventures plays in all this stuff, so Mike, well, welcome. >> Well, thanks for having me, I'm really excited to be here. It's a big day here at Accenture with the launch of the 2020 tech vision. You know, and one of the key trends is about innovation DNA, which is really saying, how does an organization connect to the external ecosystems to systematically and scalably and sustainably innovate? And that's part of the role of Accenture Ventures. >> Well, it's an interesting play, right? Because unfortunately Clayton Christensen just passed away, my favorite business writer ever. And the whole innovator's dilemma is that smart people working at big companies making sound business decisions based on revenue and their customers will always miss this continuous change. So really you need some other things to help motivate that. And that's really piece that you guys play. >> Right, exactly cause what, you know, we're a bridge builder between those highly successful large enterprises, which are big, they're slow and they're risk adverse, and the startups, which are small, fast and nothing but risk. And so for us, the role of Accenture and Accenture ventures as being part of that innovation DNA is to say, let's make a bridge, let's figure out how the elephant can dance. And as a result, not get caught up in those disruptions, but in fact leverage them to propel those big enterprises forward. >> Right, now you guys invest in all types of areas, Ais, looking through the portfolio, security, big data, I love this Industry X Dot O, what is Industry X Dot O? >> Well, so, you know, a lot of places talk about industry 4.0 but we're like, why put it, you know, X dot O, is make it a variable? five point O, six point O, which makes it evergreen. Which says, every industry on the planet is going through a transformation, you know, powered by AI, powered by all those areas you mentioned. And as a result, we want to make sure that whatever the future of any industry is, Accenture is part of it and we're bringing in the startups and of course the big technology players that are going to be the fundamental players making that transformation possible. >> Right, there's so much synergy, right? Because for the little guys, right? They've got all the juice behind the innovation and the really smart people and they're kind of breaking things and moving fast, but the challenges there are scale and a sales force and marketing and reach and distribution and all these things that are not too hard for the big guys. >> Right, and so that's why it's a marriage made heaven, right? Again, if you can bring, I always like to say the analogy of you've got the aircraft carrier and then you have all the battleships and the PT boats circling around it, that's a battle group. And so that's what we really see as the opportunity is to bring what each strength, the strength of that disruption and passion and energy and capital to marry to market scale and data and customer base, right? Put those things together, unstoppable force? >> How do the enterprises, you know, kind of view it, do they, obviously they see the value, you wouldn't be doing what you're doing, but is that something that's attracted to them? Is it too disruptive to them? How do they try to work these little startups? Cause (laughs) the other thing, right? Is always vendor viability when you're a little startup doing business with a big company and they can kill you with meetings and there's all kinds of, you know, kind of interesting things that can happen to screw that up. >> Well you're right on and so that's part of where, you know, Accenture comes in as that broker, that bridge maker, because we help each other find how to match up, how not to crush the little guy with infinite meetings, you know, in an enterprise, you know, six months is quick, in a startup, that's a funding cycle, right? And so we've got to find a way to meet each other in the middle and as a result, get the strength of each, but pointed in the same direction and really, you know, become really good dance partners. And that's what we really think any organization, cause they know they need to do it, they know they want to do it, they just don't know how. And that's the gap we help fill. >> And then how do you find your investments? Are you partnering with other venture firms? How are you kind of out prospecting for new opportunities? >> Well, so for us, since we're a corporate strategic, we're really focused on the future of our client's business, the future of the marketplace. And so for us, it's a network game. It's, you know, it's everything from what the corporate venture units at our clients are up to where they're seeing strategic bets. Of course, we're the VC, you know, of Sand Hill Road, of Tel Aviv, of Shenzhen and Shanghai, you know, Bangalore, you know, there's so many great venture capital communities. We love the syndicate, we love friends because we, you know, a financial VC will bring their discipline and we'll bring Accenture's discipline and that's a combo pack that one plus one is three. >> Right, so I want to get your take, you've been in this for a while -- >> Oh, yeah. and one of the themes that we hear over and over, right, is the acceleration of accelerating pace of technology innovation, right? And this exponential curve and people have a hard time with exponential curves, we like linear curves. But it's getting steeper and steeper and steeper. So you know, from your kind of cap bird seed, as you've watched the evolution, do you see, you know, kind of, is this the only way for the enterprises to keep ahead of these things? Is it just an augment? Is it more important than it used to be? How has the landscape kind of changing as this acceleration just keeps going and going and going? >> Well, I think that the era of build it all yourself vertically integrate it So, you know, start to finish, soup to nuts yourself, you can't do it, right? If you're a large incumbent and, but also if you think about this way, and I would talk to audience especially, you know, business audience and say, "Who's got enough budget?" Nobody, there's no such thing as enough budget, the government doesn't have enough budget, right? Nobody does, but if you partner, you can leverage other people's money, their investment cycles, and as a result, for every dollar you have, you can get multiple dollars of leverage. And as a result, no matter how fast it's going, because of the Public Clouds, because of the big software players, you can get so much further. So even though things are moving faster, what you can leverage to adapt to that change is more powerful than ever before. So the good news is the rate of change is fast, but you're not starting from dead stop. You're jumping on a moving train and going where it's going and putting your own business spin on it. >> Right, the other piece is kind of the disruptive speeds. It's funny you mentioned Amazon just, you know, watch a lot of great interviews with Bezos. One of them, he talks about AWS having, you know, a seven-year uninterrupted headstart because no one down the road in Redwood shores or Philadelphia or Waldorf was really paying attention to the little bookseller up in Seattle as a competitor for enterprise infrastructure. So you know that which is going to get you is often not the competitors that you're benchmarking against. It's not the same people that you've been competing with but can completely come out of left field. >> Well, and so that again, is why we really believe passionately that with this future, the next few years, those enterprises that have an innovation DNA that get out of their foxhole and don't just look at your bank, don't just look at FinTech, look at all tech and thanks to this thing called the internet. It's really possible, and language translation, even if you don't speak Chinese, you can get a sense of what's happening in China, where you can call a friend like Accenture and we can hook you up. And regardless of the fact is you can now, if you cast that wide net, if you challenge yourself to get out of that Foxhole and look around, well then suddenly you can't be surprised. You can see it coming and you can then use your superpowers, which is incumbency, scale, balance sheet, customer base, you know, loyalty, all those things that you brand, all the things that make you strong, you can now append that disruption to it and basically, not get disrupted. So I think that's, that's the formula for going forward. >> Yeah, well, I love the one plus one makes three formula cause it really is kind of a match made in heaven really bringing together two sets of strengths that the other person or the other party doesn't really have. So you guys been at it for awhile and continued success. >> Well, thank you very much. All right. Well, Mike, thanks for taking a minute. He's Mike, I'm Jeff, you're watching theCUBE. With the Accenture Tech Vision launch 2020. Thanks for watching, we'll see you next time. (upbeat music)

>> Announcer: From San Francisco, it's theCUBE covering Accenture Tech Vision 2020, brought to you by Accenture. >> Hey, welcome back, everybody. Jeff Rick here with theCUBE. We are high atop San Francisco, at the Accenture Innovation Hub, 33rd floor of the Salesforce Tower at the Accenture Technology Vision 2020 party. The party's getting started. Paul, and Mike, and the team are going to present the findings, and we're excited to have, actually, the hostess of this great facility. She's Ashley Miller, managing director of the San Francisco Innovation Hub. Ashley, great to see you. >> Great to see you again. >> So, congratulations once again. We were here last year. It was the grand opening of this facility. >> Ashley: Yes, sure was. >> You've had it open for a year now. >> We sure have. It's been a year. We also have a soft launch in September, so a little more than a year under our belt, and as you can see, the place is busy. >> Right, so you had the hard job, right? So Mike, and Paul, and all the big brains, they put together pretty pictures, and great statements. You're the one that actually has to help customers implement this stuff, so tell us a little bit about how you use the Tech Vision because it's pretty insightful. It's a lot deeper than cloud's going to be big, or mobile's going to be big, but to take some of these things to help you with your customers drive this innovation. >> Yeah, well, I don't know about having the hard job against theirs. They certainly have the hard job understanding what these technology trends are that are going to have an impact on business three to five years out, but I certainly do have the fun job, and the exciting job. I get to work with our clients every day here in the hub, and work with our 250 dedicated innovation teammates here in the hub to think about the impact of these trends to their business, so clients come in for a day, two days, a week, and we'll sit with technologists. We'll get our hands on some of these emerging technologies, on quantum computing, on artificial intelligence, machine vision, machine learning, natural language processing. You name it, we have it here. We have a smart materials showcase going on upstairs that a lot of these clients have checked out, so they can come here, they can get their hands on these technologies that are driving these trends, and then, they can sit and work with strategists, and others who can think about, what are the application of these technologies to their business? And then, what's really exciting is we have engineers here who can then help build prototypes to actually test these technologies to see what their impacts are for the business, and then, finally, support the rollout of pilots that prove successful, so it's, again, it's a fun job. I love it. >> And how does it actually work in terms of best practices? Is it starting out as some strategy conversation with the top-level people about trying to integrate say, more AI into their products, or is it maybe more of within a product group, where they're trying to be a little bit more innovative, and it really challenges on the product development path? You talked about the material science that they want to go down, what are some of the ways that people actually work with you, and work with your teams, and leverage this asset here at the hub? >> Yeah, so ultimately, it's both, and it's at all ends of the spectrum. We are here in the Silicon Valley, where clients are coming from all over the globe to understand what the trends are that are going to shape their business operations in the future, so we have clients that are coming through. Some people call them digital safaris, or innovation safaris. Some people may say that's not valuable. I think it is valuable to come and get firsthand experience, knowledge, touch and feel these things, and really dedicate time to think about the application to your business. On the other end of the spectrum, we'll have clients who are here for days, weeks, and months, and we have ongoing partnerships with clients. We've been open for about a year and a half, for that and longer to actually embed this innovation capabilities into their business, so I think maybe an answer is, what is the most successful model I see? I really get to dig into these clients who are using our services as an innovation engine to help them drive their business, and to help augment their innovation capabilities, and it's those clients I see who are continuously testing, continuously learning, understanding the impact of these technologies, driving proofs of concepts to test them who are able to make progress. >> Can it happen without top down support? I mean, we talked, unfortunately Clayton Christensen just passed away. Innovator's Dilemma, my favorite business book of all time because he said smart people making sound business decisions based on customers, profitability, and business, logical business priorities, will always miss discontinuous change. Jeff Bezos talks about AWS had a seven-year head start on their public cloud because no one down in Redwood Shores, or Waldorf was paying attention to the bookseller in Seattle, so it's hard for big companies to innovate, so is it really necessary for that top down, that, hey, we are going to invest, and we are going to saddle up, and get our hands dirty with some of these technologies for them to be successful, and drive innovation because it's not easy for big enterprises. >> You're exactly right. Innovation is hard. Change is difficult. I was a student of Clayton Christensen, and like you and many others, are mourning his passing. He made a significant impact, this area of research. Change is hard. It's difficult, so we see a lot of clients who are coming in, and are doing interesting things to overcome that inertia to stay put, and I think tops down leadership is a significant piece of that. You need to have leaders who are supporting movement, who are enabling decision making quickly, so they are supporting small decisions they're making frequently so that there's not a massive decision that happens at the end of a pilot, but rather, micro-decisions that help ensure things are being moved along, building pilots and proof of concepts, of course, helped in that movement to get buy-in, to get leaders to see the value, and to also pivot if something isn't working, so innovation is hard. Accenture's Innovation Hub helps to fill some of those gaps because really, we are a sandbox, where you can come in, build the proof of concepts, test these ideas, and then, in an ongoing, continuous way, help understand their impacts to your business. >> Right, and I'm just curious how often, as order of magnitude, this innovation around a particular, existing business, maybe it's the new materials, the new way of thinking about it, versus maybe, is this a way for them to really explore wild ideas, or go out a little bit beyond the edge of what they're going to execute in their normal, day to day, say, product development because which of those do you find is best use of your resources? >> Yeah, so again, it runs the spectrum. I mean, I think the companies who are innovating around the edges, they're spending a lot of money to run pilots, and tests, proof of concepts that may not have significant value to the core of their business, so of course, it's the companies who are really thinking about how they're going to innovate new business models, how they're going to build on these trends to figure out where their company is going in the future, and be ready, and be ahead of the curve, but in order to get there, maybe you do need to get your hands dirty, and run some tests, run some proof of concepts to understand the technology. The key is, in order to ensure that the investment in those activities is actually helping you move the needle. >> Right, so how should people, if somebody's watching this, and they want to get involved, or I'm busting my head. We're not moving as fast as we need to. I'm nervous. I have an imperative. I need to accelerate this stuff. How do they get involved, and how do they end up here getting their hands dirty with some of your team? >> Yeah, thanks for that, appreciate that. Accenture works with the largest organizations around the globe, and there's typically a client account leader, partner, from Accenture embedded into the biggest organizations, and so, for those who are existing clients, they can reach out to their client account lead, and we would be delighted to welcome them in, and do some, either, exploratory research into these technologies, or actually, do some longer-term innovation engine work, where we're helping to augment their capabilities. For those who, maybe, aren't an Accenture client, then, we do have open houses. We do quarterly open events, not only for potential new clients, but also, for people in the community for partners, for schools. We're really committed to helping to be an asset for San Francisco, for this community, so keep your eyes peeled for opportunities to come in. >> Yeah, that's great because last time when we were here when we opened there was a lot of conversation about being a very active participant in the community. You guys are sponsors with the Warriors at the Chase Center, but no, I think we had a number of people from the city and county of San Francisco in talking about the opportunities, and being an active, engaged member of the community beyond just a for-profit company. >> Absolutely, and the undercurrent of this year's Tech Vision, which is about to launch is all about thinking beyond the edges of your organization, and understanding the choices that you make, how they impact the communities you serve, so it's really important to us to be a good steward of that here at Accenture, and we have teammates accessible within the hub. For example, data enthesis, who can help you understand the decisions you're making around artificial intelligence. Are you using data securely? Are you using it in a way that makes people feel comfortable? So we have teammates here who can help clients consider the impact of these decisions that goes beyond the four walls, to really be a good steward for the next generation. >> Okay, well, next time I come, I'm wearing a white coat, so we can go get our hands dirty. >> I like it. >> All right, Ashley, well, again, congratulations to you and the team, and have a great evening. >> Thank you so much. >> All right, she's Ashley, I'm Jeff. You're watching theCUBE. We're at the Accenture Innovation Hub for the Technology Vision 2020. Thanks for watching, and we'll see you next time. (funky electronic music)

(funk music) (funk music) (funk music) (funk music) >> Hello and welcome to theCUBE studios in Palo Alto, California for another CUBE conversation where we go in-depth with thought leaders driving innovation across the tech industry. I'm your host, Peter Burris. Every enterprise is responding to the opportunities of cloud with significant changes in people, process, how they think about technology, how they're going to align technology overall with their business and with their business strategies. Now those changes are affecting virtually every aspect of business but especially every aspect of technology. Especially security. So what does it mean to envision a world in which significant new classes of services are being provided through cloud mechanisms and modes, but you retain and in fact, even enhance the quality of security that your enterprise can utilize. To have that conversation, we're joined today by a great guest, Amit Sinha is president and CTO at Zscaler. Amit, welcome back to theCUBE. >> Thank you Peter, it's a pleasure to be here. >> So before we get into it, what's new at Zscaler? >> Well, at Zscaler our mission is to make the internet and cloud a secure place for businesses and as I engage with our global 2000 customers and prospects, they are going through some of the digital transformation challenges that you just alluded to. Specifically for security, what is happening is that they had a lot of applications that were sitting in a data center or in their headquarters and that center of gravity is now moving to the cloud. They probably adopt their Office 365, and Box, and Salesforce, and these applications have moved out. Now in addition, the users are everywhere. They're accessing those services, not just from offices but also from their mobile devices and home. So if your users have left the building, and your applications are no longer sitting in your data center, that begs that question: Where should the security stack be? You know, it cannot be your legacy security appliances that sat in your DMZ and your IT closets. So that's the challenge that we see out there, and Zscaler is helping these large global organizations transform their security and network for a more mobile and a cloud-first world. >> Distributed world? So let me make sure I got this right. So basically, cause I think I totally agree with you >> Right. >> Just to test it, that many regarded the cloud as a centralization strategy. >> Correct. >> What we really see happening, is we're seeing enterprises more distribute their data, more distribute their processing, but they have not updated how they think about security so the presumption is, "yeah we're going to put more processing data out closer to the action but we're going to backhaul a whole bunch back to our security model," and what I hear you saying is no, you need to push those security services out to where the data is, out to where the process, out to where the user is. Have I got that right? >> You have nailed it, right. Think of it this way, if I'm a large global 2000 organization, I might have thousands of branches. All of those branches, traditionally, have used a hub-and-spoke network model. I might have a branch here in Palo Alto but my headquarters is in New York. So now I have an MPLS circuit connecting this branch to New York. If my Exchange server and applications and SAP systems are all there, then that hub-and-spoke model made sense. I am in this office >> Right. >> I connect to those applications and all my security stack is also there. But fast forward to today, all of those applications are moving and they're not just in one cloud. You know, you might have adopted Salesforce.com for CRM, you might have adopted Workday, you might have adopted Office 365. So these are SaaS services. Now if I'm sitting here in Palo Alto, and if I have to access my email, it makes absolutely no sense for me to VPN back to New York only to exit to the internet right there. What users want is a fast, nimble user experience without security coming in the way. What organizations want is no compromise in their security stack. So what you really need is a security stack that follows the user wherever they are. >> And the data. >> And the data, so my data...you know Microsoft has a front-door service here in Redwood City and if if you are a user here and trying to access that, I should be able to go straight with my entire security stack right next to it. That's what Gartner is calling SASE these days. >> Well, let's get into that in a second. It almost sounds as though what you're suggesting is that the enterprise needs to look at security as a SaaS service itself. >> 100 percent. If your users are everywhere and if your applications are in the cloud, your security better be delivered as a consistent "as-a-service," right next to where the users are and hopefully co-located in the same data center as where the applications are present so the only way to have a pervasive security model is to have it delivered in the cloud, which is what Zscaler has been doing from day one. >> Now, a little spoiler alert for everybody, Zscaler's been talking about this for 10-plus years. >> Right. >> So where are we today in the market place starting to recognize and acknowledge this transformation in the basic security architecture and platform that we're going through? >> I'm very excited to see that the market is really adopting what Zscaler has been talking about for over a decade. In fact, recently, Gartner released a paper titled "SASE," it stands for Secure Access Service Edge and there are, I believe, four principal tenets of SASE. The first one, of course, is that compute and security services have to be right at the edge. And we talked about that. It makes sense. >> For where the service is being delivered. >> You can't backhaul traffic to your data center or you can't backhaul traffic to Google's central data center somewhere. You need to have compute capabilities with things like SSL Interception and all the security services running right at the edge, connecting users to applications in the shortest path, right? So that's sort of principle number one of SASE. The second principle that Gartner talks about, which again you know, has been fundamental to Zscaler's DNA, is to keep your devices and your branch offices light. Don't shove too much complexity from a security perspective on the user devices and your branches. Keep it simple. >> Or the people running those user devices >> Absolutely >> in the branches >> Yeah, so you know, keep your branch offices like a light router, that forwards traffic to the cloud, where the heavy-lifting is done. >> Right. >> The third principle they talk about is to deliver modern security, you need to have a proxy-based architecture and essentially what a proxy architecture allows you to do is to look at content, right? Gone are the days where you could just say, stop a website called "evil.com" and allow a website "good.com," right? It's not like that anymore. You have to look at content, you know. You might get malware from a Google Drive link. You can't block Google now, right? So looking at SSL-encrypted content is needed and firewalls just can't do it. You have to have a proxy architecture that can decrypt SSL connections, look at content, provide malware services, provide policy-based access control services, et cetera and that's kind of the third principle. And finally what Gartner talks about is SASE has to be cloud-native, it has to be, sort of, born and bred in the cloud, a true multitenant, cloud-first architecture. You can't take, sort of, legacy security appliances and shove it in third-party infrastructure like AWS and GCP and deliver a cloud service and the example I use often is, just because you had a great blu-ray player or a DVD player in your home theater, you can't take 100,000 of these and shove it into AWS and become a Netflix. You really need to build that service from the ground up. You know, in a multitenant fashion and that's what we have done for security as a service through the cloud. >> So we are now, the market seems to be kind of converging on some of the principles that Zscaler's been talking about for quite some time. >> Right. >> When we think about 2020, how do you anticipate enterprises are going to respond as a consequence of this convergence in acknowledging that the value proposition and the need are starting to come together? >> Absolutely, I think we see the momentum picking up in the market, we have lots of conversations with CIO's who are going through this digital transformation journey, you know transformation is hard. There's immune response in big organizations >> Sure. >> To change. Not much has changed from a security and network architecture perspective in the last two decades. But we're seeing more and more of that. In fact, over 400 of global 2000 organizations are 100 percent deployed on Zscaler. And so that momentum is picking up and we see a lot of traction with other prospects who are beginning to see the light, as we say it. >> Well as you start to imagine the relationship between security and data, between security and data, one of the things that I find interesting is many respects to cloud, especially as it becomes more distributed, is becoming better acknowledged almost as a network of services. >> Right. >> As opposed to AWS as a data center here and that makes it a cloud data center. >> Right. >> It really is this network of services, which can happen from a lot of different places, big cloud service providers, your own enterprise, partners providing services to you. How does the relationship between Zscaler and kind of an openness >> Hm-mm. >> Going to come together? Hm-mm. >> So that you can provide services from a foreign enterprise to the enterprise's partners, customers, and others that the enterprise needs to work with. >> That's a great question, Peter and I think one of the most important things I tell our customers and prospects is that if you look at a cloud-delivered security architecture, it better embrace some of the SASE principles. One of the first things we did when we built the Zscaler platform was to distribute it across 150 data centers. And why did we do that? We did that because when a user is going to destinations, they need to be able to access any destination. The destination could be on Azure, could be on AWS, could be Salesforce, so by definition, it has to be carrier-neutral, it has to be cloud-neutral. I can't build a service that is designed for all internet traffic in a GCP or AWS, right. So how did we do that? We went and looked at one of the world's best co-location facilities that provide maximum connectivity options in any given region. So in North America, we might be in an Equinix facility and we might use tier one ISPs like GTT and Zayo that provide excellent connectivity to our customers and the destinations they want to visit. When you go to China, there's no GCP there, right so we work with China Unicom and China Telecom. When we are in India, we might work with an Airtel or a Sify, when we are in Australia, we might be working with Telstra. So we work with, you know, world class tier one ISPs in best data centers that provide maximum connectivity options. We invested heavily in internet exchange connectivity. Why? Because once you come to Zscaler, you've solved the physics problem by building the data center close to you, the next thing is, you want quickly go to your application. You don't want security to be in the way >> Right. >> Of application access. So with internet exchange connectivity, we are peered in a settlement-free way or BGP with Microsoft, with Akamai, with Apple, with Yahoo, right. So we can quickly get you to the content while delivering the full security stack, right? So we had to really take no shortcuts, back to your point of the world is very diverse and you cannot operate in a walled garden of one provider anymore and if you really build a cloud platform that is embracing some of the SASE principles we talked about, you have to do it the hard way. By building this one data center at a time. >> Well, you don't want your servicers to fall down because you didn't put the partnerships in place >and hardend them Correct. >> As much as you've hardened some of the other traffic. So as we think about kind of, where this goes, what do you envision Zscaler's, kind of big customer story is going to be in 2020 and beyond? Obviously, the service is going to be everywhere, change the way you think about security, but how, for example, is the relationship between the definition of the edge and the definition of the secure service going to co-evolve? Are people going to think about the edge differently as they start to think more in terms of a secure edge or where the data resides and the secure data, what do you think? >> Let's start off with five years and go back, right? >> We're going forward. >> Work our way back. Well, five years from now, hopefully everyone is on a 5G phone, you know, with blazing-fast internet connections, on devices that you love, your applications are everywhere, so now think of it from an IT perspective. You know, my span of control is becoming thinner and thinner, right? my users are on devices that I barely control. My network is the internet that I really don't control. My applications have moved to the cloud or either hosted in third-party infrastructure or run as a SaaS application, which I really don't control. Now, in this world, how do I provide security? How do I provide user experience? Imagine if you are the CIO and your job is to make all of this work, where will you start, right? So those are some of the big problems that we are helping our customers with. So this-- >> Let me as you a question 'cause here's where I was going with the question. I would start with, if I can't control all these things, I'm going to apply my notion of security >> Hm-mm. >> And say I am going to control that which is within >> Right. >> my security boundaries, not at a perimeter level, not at a device level, but at a service level. >> Absolutely and that's really the crux of the Zscaler platform service. We build this Zero Trust architecture. Our goal is to allow users to quickly come to Zscaler and Zscaler becomes the policy engine that is securely connecting them to all the cloud services that they want to go to. Now in addition, we also allow the same users to connect to internal applications that might have required a traditional VPN. Now think of it this way, Peter. When you connect to Google today, do you VPN to Google's network? To access Gmail? No. Why should you have to VPN to access an internal application? I mean, you get a link on your mobile phone, you click on it and it didn't work because it required a separate form of network access. So with Zscaler Internet Access and Zscaler Private Access, we are delivering a beautiful service that works across 150 data centers. Users connect to the service and the service becomes a policy engine that is securely connecting you to the destinations that you want. Now, in addition, you asked about what's going to happen in a couple of years. The same service can be extended for partners. I'm a business, I have hundreds of partners who want to connect to me. Why should I allow legacy VPN access or private circuits that expose me? I don't even know who's on the other end of the line, right? They come onto my network and you hear about the Target breaches because some HVAC contract that had unrestricted access, you hear about the Airbus breach because another contract that had access. So how do we build a true Zero Trust cloud platform that is securely allowing users, whether it's your employees, to connect to named applications that they should, or your partners that need access to certain applications, without putting them on the network. We're decoupling application access from network access. And there's one final important linchpin in this whole thing. Remember we talked about how powerless organizations >> Right. >> feel in this distributed model? Now imagine, your job is to also ensure that people are having a good user experience. How will you do that, right? What Zscaler is trying to do now is, we've been very successful in providing the secure and policy-based connectivity and our customers are asking us, hey, you're sitting in between all of this, you have visibility into what's happening on the user's device. Clearly you're sitting in the middle in the cloud and you see what's happening on the left-hand side, what's happening on the right-hand side. You know, you have the cloud effect, you can see there's a problem going on with Microsoft's network in the China region, right? Correlate all of that information and give me proactive intelligence around user experience and that's what we launched recently at Zenith Live. We call it Zscaler Digital Experience, >> Hmm. >> So overall the goal of the platform is to securely connect users and entities to named applications with Zero Trust principles. We never want security and user experience to be orthogonal requirements that has traditionally been the case. And we want to provide great user experience and visibility to our customers who've started adopting this platform. >> That's a great story. It's a great story. So, once again, I want to thank you very much for coming in and that's Amit Sinha, who is the president and CTO at Zscaler, focusing a lot on the R&D types of things that Zscaler's doing. Thanks again for being on theCUBE. >> It's my pleasure, Peter. Always enjoy talking to you. >> And thanks for joining us for another CUBE conversation. I'm Peter Burris, see you next time. (funk music) (funk music)

>> Narrator: From Burlingame, California, it's theCUBE. Covering Sumo Logic Illuminate 2019. Brought to you by Sumo Logic. >> Hey, welcome back, everybody, Jeff Frick here with theCUBE. We're at Sumo Logic Illuminate 2019. It's at the Hyatt Regency San Francisco Airport. We're excited to be back. It's our second year, so third year of the show, and really, one of the key tenants of this whole event is the report. It's the fourth year of the report. It's The Continuous Intelligence Report, and here to tell us all about it is the VP of Product Marketing, Kalyan Ramanathan. He's, like I said, VP, Product Management of Sumo Logic. Great to see you again. >> All right, thank you, Jeff. >> What a beautiful report. >> Absolutely, I love the cover and I love the data in the report even more. >> Yeah, but you cheat, you cheat. >> How come? >> 'Cause it's not a survey. You guys actually take real data. >> Ah, that's exactly right, exactly right. >> No, I love them, let's jump into it. No, it's a pretty interesting fact, though, and it came out in the keynote that this is not a survey. Tell us how you get the data. >> Yeah, I mean, so as you already know, Sumo Logic is a continuous intelligence platform. And what we do is to help our customers manage the operations and security of the mission critical application. And the way we do that is by collecting machine data from our customers, and many of our customers, we have two thousand, our customers, they're all running modern applications in the cloud, and when we collect this machine data, we can grade insights into how are these customers building their applications, how are these customers running and securing their application, and that insight is what is reflected in this report. And so, you're exactly right, this is not a survey. This is data from our customers that we bring into our system and then what we do is really treat things once we get this data into our system. First and foremost, we completely anonymize this data. So, we don't-- >> I was going to say Let's make sure we have to get that out. >> Yes, absolutely, so we don't have any customer references in this data. Two, we genericize this data. So, we're not looking for anomalies. We are looking for broad patterns, broad trends that we can apply across all of our customers and all of these enterprises that are running modern mission critical applications in the cloud. And then three, we analyze ten weeks to Sunday. We look at these datas, we look at what stands out in terms of good sample sizes, and that's what we reflect in this report. >> Okay, and just to close a loop on that, are there some applications that you don't include? 'Cause they're just legacy applications that're running on the cloud that doesn't give you good information, or you're basically taking them all in? >> Yeah, it's a good point, I mean we collect all data and we collect all applications, so we don't opt-in applications or out applications for that matter because we don't care about it. But what we do look for is significant sample size because we want to make sure that we're not talking about onesie-twosie applications here or there. We're looking for applications that have significant eruption in the cloud and that's what gets reflected in this report. >> Okay, well, let's jump into it. We don't have time to go through the whole thing here now, but people can get it online. They can download their own version and go through it at their leisure. Biggest change from last year as the fourth year of the report. >> Yeah, I mean, look, there are three big insights that we see in this report. The first one is, while we continue to see AWS rule in the cloud and that's not surprising at all, we're starting to see pretty dramatic adoption of multi-cloud technologies. So, two years ago, we saw a smidgen of multi-cloud in this report. Now, we have seen almost a 50% growth year over year in terms of multi-cloud adoption amongst enterprises who are in the cloud, and that's a substantial jump albeit from a smaller baseline. >> Do you have visibility if those are new applications or are those existing ones that are migrating to different platforms? Are they splitting? Do you have any kind of visibility into that? >> Yeah, I mean, it's an interesting point, and part of this is very related to the growth of Kubernetes that we also see in this report. What ypu've seen is that, in AWS itself, Kubernetes adoption has gone up significantly, what's even more interesting is that, as you think about multi-cloud adoption, we see a lot of Kubernetes, Kubernetes as the platform that is driving this multi-cloud adoption. There is a very interesting chart in this report on page nine. Obviously, I think you guys can see this if they want to download the report. If you're looking at AWS only, we see one in five customers are adopting Kubernetes. If you're looking at AWS and GCP, Google Cloud Platform, we see almost 60% of our customers are adopting Kubernetes. Now, when you put in AWS-- >> One in five at AWS, 60% we got Google, so that means four out of five at GCP are using Kubernetes and bring that average up. >> And then, if you look at AWS, Azure, and GCP, now you're talking about the creme de la creme customers who want to adopt all three clouds, it's almost 80% adoption of Kubernetes, so what it tells you is that Kubernetes has almost become this new Linux in the cloud world. If I want to deploy my application across multiple clouds, guess what, Kubernetes is that platform that enables me to deploy my application and then port it and re-target it to any other cloud or, for that matter, even an on-prem environment. >> Now, I mean, you don't see motivation behind action, but I'm just curious how much of it is now that I have Kubernetes. I can do multi-cloud or I've been wanting to do multi-cloud, and now that I have Kubernetes, I have an avenue. >> Yeah, it started another question. What's the chicken and what's the egg right here? My general sense, and we've debated this endlessly in our company, our general sense has been that the initiative to go multi-cloud typically comes top down in an organization. It's usually the CIO or the CSO who says, you know what, we need to go multi-cloud. And there are various reasons to go multi-cloud, some of which you heard in our keynote today. It could be for more reliability, it could be for more choice that you may want, it could be because you don't want to get logged into any one cloud render, so that decision usually comes top down. But then, now, the engineering teams, the ops teams have to support that decision, and what these engineering teams and these ops teams have realized is that, if they deploy Kubernetes, they have a very good option available now to port their applications very easily across these various cloud platforms. So, Kubernetes, in some sense, is supporting the top down decision to go multi-cloud which is something that is shown in spades as a result of this report. >> So, another thing that jumped out at me, or is there another top trend you want to make sure we cover before we get in some of those specifics? >> I mean we can talk to-- >> Yeah, one of them, one of them that jumped out at me was Docker. The Docker adoption. So, Docker was the hottest thing since sliced bread about four years ago, and is the shade of Kubernetes, not that they're replacements for one another specifically, but it definitely put a little bit of appall in the buzz that was the Docker, yet here, the Docker utilization, Docker use is growing year over year. 30%! >> I'll be the first one to tell you that Docker adoption has not stalled at all. This is shown in the report. It's shown in customers that we talk to. I mean, everyone is down the path of containerizing their application. The value of Docker is indisputable. That I get better agility, that I get better portability with Docker cannot be questioned. Now, what is indeed happening is that everyone who is deploying Docker today is choosing a orchestration technology and that orchestration technology happens to be Kubernetes. Again, Kubernetes is the king of the hill. If I'm deploying Docker, I'm deploying Kubernetes along with it. >> Okay, another one that jumped out at me, which shouldn't be a big surprise, but I'm a huge fan of Andy Jassy, we do all the AWS shows, and one of always the shining moments is he throws up the slide, he's got the Customer slide. >> There you go. >> It's the Services slide which is, in like, 2.6 font across a 100-foot screen that fills Las Vegas, and yet, your guys' findings is that it's really: the top ten applications are the vast majority of the AWS offerings that are being consumed. >> Yep, not just that. It's that the top services in AWS are the infrastructure-as-a-service services. These are the core services that you need if you have to build an application in AWS. You need ECDO, I need Esri, I need identity access management. Otherwise, I can't even log into AWS. So, this again goes back to that first point that I was making was that multi-cloud adoption is top of mind for many, many customers right now. It's something that many enterprises think of, and so, if I want to indeed be able to port my application from AWS to any other environment, guess what I should be doing? I shouldn't be adopting every AWS service out there because if I frankly adopted all these AWS services, the tentacles of the cloud render are just so that I will not be able to port away from my cloud render to any other cloud service out there. So, to a certain extent, many of the data points that we have in this report support the story that enterprises are becoming more conscious of the cloud platform choices that they are making. They want to at least keep an option of adopting the second or the third cloud out there, and they're consciously, therefore choosing the services that they are building their applications with. >> So, another hot topic, right? Computer 101 is databases. We're just up the road from Oracle. Oracle OpenWorld's next week. A lot of verbal jabs between Oracle and some of the cloud providers on the databases, et cetera. So, what do the database findings come back as? >> I mean, look at the top four databases: Redis, MySQL, Postgres, Mongo. You know what's common across them? They're all open-source. They're all open-source database, so if you're building your application, find standard components that you can then build your application on, whether it's a community that you can then take and move to any other cloud that you want to. That's takeaway number one. Takeaway number two, look at where Oracle is in this report. I think they're the eighth database in the cloud. I actually talked to a few customers of ours today. >> Now, are you sampling from Oracle's cloud? Is that a dataset? >> No, this is-- >> Yes, right, okay. So, I thought I want to make sure. >> And, if AWS is almost the universe of cloud today, we can debate at some bids, but it is close enough, I'd say, it tells you where Oracle is in this cloud universe, so our friends at Redwood City may talk about cloud day in and day out, but it's very clear that they're not making much of intent in the cloud at this point. >> And then, is this the first year the rollup of the type of database that NoSQL exceeded relational database? >> No, I mean, we've been doing this for the last two years, and it's very clear that NoSQL is ahead of SQL in the cloud, and I think the way we think about it is primarily because, when you are re-architecting your applications in the cloud, the cloud gives you a timeline, it gives you an opportunity to reconsider how you build out your data layer, and many of our customers are saying NoSQL is the way to go. The scalability demands, the reliability demands, so if my application was such that I now have the opportunity to rethink and redo my data layer, and frankly, NoSQL is winning the game. >> Right, it's winning big time. Another big one: serverless, Lambda. Actually, I'm kind of surprised it took so long to get to Lambda 'cause we've been going to smaller atomic units of compute, store, and networking for so, so long, but it sounds like, looks like we're starting to hit some critical mass here. >> Yeah, I mean, look, Lambda's ready for primetime. I mean we have seen that tipping point out here. Almost one in three customers of ours are using Lambda in production environments. And then, if you cast a wider net, go beyond production and even look at dev tests, what we see is that almost 60% of Sumo Logic's customers, and if you look at 2,000 customers, that's a pretty big sample size. Almost 60% of enterprises are using Lambda in some way, shape, or form. So, I think it's not surprising that Lambda is getting used quite well in the enterprise. The question really is: what are these people doing with Lambda? What's the intent behind the use of Lambda? And that's where I think we have to do some more research. My general sense, and I think it's shared widely within Sumo Logic, is that Lambda's still at the edges of the application. It's not at the core of the application. People are not building your mission critical application on Lambda yet because I think that that paradigm of thinking about event-driven application is still a little foreign to many organizations, so I think it'll take a few more years for an entire application to be built on Lambda. >> But you would think, if it's variable demand applications, whether that's a marketing promotion around the Super Bowl or running the books at the end of the month, I guess it's easy enough to just fire up the servers versus doing a pure Lambda at this point in time, but it seems like a natural fit. >> If you're doing the utility type application and you want to start it and you want to kill it and not use it after an event has come and gone, absolutely, Lambda's the way to go. The economics of Lambda. Lambda absolutely makes sense. Having said that, I mean, if you're to build a true mission critical application that you're going to be keeping on for a while to come, I'm not seeing a lot of that in Lambda yet, but it's definitely getting there. I mean we have lots of customers who are building some serious stuff on Lambda. >> Well, a lot of great information. It's nice to have the longitudinal aspect as you do this year over year, and again, we're glad you're cheating 'cause you're getting good data. >> (chuckles) >> (laughs) You're not asking people questions. >> Yeah, I mean, I'd like to finish out by saying this is a report that Sumo Logic builds every year, not because we want to sell Sumo Logic. It's because we want to give back to our community. We want our community to build great apps. We want them to understand how their peers are building some amazing mission critical apps in the cloud and so, please download this report, learn from how your peers are doing things, and that's our only intent and goal from this report. >> Great, well, thanks for sharing the information and a great catch-up, nice event. >> All right, thank you very much, Jeff. >> All right, he's Kalyan, I'm Jeff. You're watching theCUBE. We're at Sumo Logic Illuminate 2019. Thanks for watching, we'll see you next time. (upbeat electronic music)

(upbeat funky music) >> From our studios, in the heart of Silicon Valley, Palo Alto, California. This is a CUBE conversation. >> Okay, welcome back everyone, we're here at theCUBE studios in Palo Alto for a special CUBE conversation. Talking security, talking about the internet and cloud computing. Martin Bosshardt is the CEO of Open Systems. Martin, great to see you. Last time we chatted was in December you were in Vegas, we had a little on the ground, great to meet your team. Welcome back to theCUBE. >> Thank you so much. It's great to be here. >> So exciting things going on, I want to get a state of the Open Systems and the industry, obviously security's a really big big thing, a lot stuff going on in the industry. Black Hat. Defcon. Amazon had a big event called re:Inforce, which was really kind of the first cloud securities show. Which brings the whole, your kind of value proposition to the table but, you guys have a new office here in Silicon Valley. I saw a video on the internet, trending. >> Yeah. >> Pretty nice place work. Give us the update on the current office and Silicon Valley presence. >> Yeah we are, you know, we are really happy to be now here in the U.S. headquarters in Redwood City and Silicon Valley. So, this really helps us also to be closer to the talents, to be closer to all the going to market activities and also to understand the market better. So, it's really exciting to be here and obviously also our, I mean the people love to work here in Silicon Valley. Weather is always great. >> Yeah, weathers always great and the office has got that good working vibe there. Take a minute to explain Open Systems real quick for the folks not familiar with the video 'cause we did last December in Vegas with your team. Tell them what your companies value propositions is and some of the growth you're experiencing. >> Right, so, Open Systems really is, you know, we operate SD-WAN in a secure way for our customer, so it's really focusing on making a relatively complicated technology, from operational point of view, very easy to consume for our customers. So this is, I think, something we started more than 15 years ago in Europe and I would say Open Systems is very much comparable, or at least the going to market part, is very much comparable to an organic farms. We have a wonderful ecosystems in Switzerland, especially in the financial services industry and our customers just love the way we provided those services and told their neighbors and friends and this is really how we grew on a global scale. Currently Open Systems is operating in more than 180 countries, SD-WAN and security infrastructure for customers and protect approximately 2.5 to three million in users globally. And when we started to enter the U.S. market, we learned that the way we provide SD-WAN in a secure way, really resonates a lot with the U.S. market because we can make complex infrastructures, especially projects going to the cloud, very easy to consume for our customers. So, we are really exciting on the growth side right now, we grow super fast in the U.S., we have been very successful in latest customers, we won Chemers, we won Chemit... >> So you're winning a lot of business. >> We are winning a lot of business and what's exciting about it is those customers give us really very valuable feedback on the difference how we provided services is really exciting... >> You know Martin, I was observing and talking to your team in December when we first met you guys for the first time and you just briefly touched on it on your description of the company success. A lot of the early success and continued success has been word of mouth. >> Right. >> With the organic, not like big marketing splash in the pool, kind of like, you know, banging the drum hard, although you are doing some marketing now but and being in the U.S. That word of mouth has been really a testament to the quality of the product, so I got to ask you, what are they happy about? What's the problem that you're solving? What's the big buzz? Why are they so excited to share, to their peers and colleagues about Open Systems? What's the big revelation? >> Thank you for the credit. I think, you know, everybody goes to the cloud and what you really need is an SD-WAN to access the cloud. What that also means for all those companies, they have to rethink their security posture. So if you add now all those products and then you try to operate those products, it turns out it's relatively complicated compared to an old school MPLS Network we used to operate in the past. So, this is really where Open Systems comes in and helps customers to operate that in very easy ways. So we integrate, all those products needed, to operate the global SD-WAN in a secure way, on a single delivery platform and that allows customers to consume that entire suite in a very very easy way. >> I want to get your vision on the future of Open Systems. I know you guys call it secure SD-WAN. I'm a little bit more radical and controversial in the sense. I think SD-WAN is kind of passe term, I think, it's really cloud connectivity work anywhere, people are working at home more than ever, cloud computing has brought in essentially enterprise cloud. We're calling it cloud 2.0, where, it's not just public cloud and having workloads in there, taking advantage of the greatest of cloud 1.0. It's enterprises, this is hybrid, it's multi-cloud, you seeing a, really a distributed computing, a networking problem and a security problem being at the center of this new work environment. >> Yeah. >> Essentially, people connected to something. >> Right. >> It's cloud right, I mean. We can call it SD-WAN because it used to be an office, campus, remote office, very static dynamic. What's your vision? >> You're absolutely right. I mean, this is really where it all goes. Let's say, a network was a network and it was very clear what a network does, right now it's more like, we want to just connect users to cloud services and it's not so clear where those services are coming from and it's not so clear where those users are sitting, where you consume from. And, it results in a phenomenal opportunity to be much more agile, much more, much faster, also to set-up new services, but it also is a challenge for IT operations. Because you know, you might have a group of users saying, well this and this service doesn't work well and now you have to debug. Why is not performing, why isn't Germany maybe, a service coming from the U.S., not performing well? Or you have an IoT device suddenly not really collecting data in a right way and this is really where SD-WAN becomes an orchestration layer. SD-WAN really helps you to orchestrate all those services and make sure you have the SLA available, at all times, everywhere. And also, understand if it's not delivering right and this is really rare where I believe... Ya, we need new solutions to make these easy because... >> You know, a lot of companies talk about digital transformation, that becomes the office, you know, the top CEO, board conversation, let's transform and be digital. But the underlying infrastructure, which is very complex, you can talk about distributing computing, you got networking, all these things in place and old, new, all kind of mashed together with cloud. It's easy to say digital transformation but you're talking about digital transformation of the business on top of existing complex hardware, which comes out the networking, moving packets from A to B, storing it on drives and now you have people working at home, so you have people working globally. >> Right. >> It's not that simple. >> No. >> It's complicated. >> It is really... >> It's not just a U.S. problem, it's like a have a team in, an engineering team in the U.K. and Germany, wherever, business... So it's a global problem. >> Exactly and also it's about, you know, how do you process all the data in an efficient way. And where we see a lot of iteration power released is right now in the Cloud. It's really exciting how easy it gets to consume all that computing power out of the cloud but you need to make sure it is available and you need to understand what is happening if it's not available and how to fix that. And this is really where, I think networking became more demanding, more challenging but also, obviously offers a tremendous opportunity for innovation. >> And I think the security industry has gotten much broader scope to it, used to be, hey you know, I'm a nerd, I'm Black Hat, I'm a blue team, red team, secure the environment, get a perimeter and okay that's gone, we'll take care of threats, malware, all this stuff's going on. But when you think about like cloud 2.0, cloud 1.0 is compute storage, great applications can load up at the cloud, all this great stuffs happening, hooray, yeah, rah-rah. Now cloud 2.0 is networking and security. >> Right. >> Independent of everything right so, what's your take on that? How is Open Systems, you know, helping companies? And what do you say to your customers when you say, hey, you know, compute networking, the storage is good, the cloud on premise no problem, there's operating models for that but you got networking and you got security to deal with on top of all the complexity. What's your story? >> I think the most important thing is, you know, we have to live with the fact that some device system tools are not secure. So I think IoT's a very good example. If you want to have all those sensors out there and be close to the customer, be close to some business processes, you need IoT. But, it's just not possible to have these very cheap devices built in a secure way. So, it's a lot about how do you design a network, to design it in a resilient secure way and that means that you have to think in cells, you have to think in compartments and that makes it relatively easy, secure again, but, it is from operational point of view, quite a challenge because you do not operate any more one network, you suddenly operate maybe any networks. >> On that point, just to kind of wrap up here. The the security challenges around IoT, Machine Learning and AI, which is clearly becoming part of the fabric of, a company's going to leverage that... >> Right. What are some of the big challenges that companies are having and what do you do to solve it? >> You know, in the old network world, you had a network where everything was connected based on one network. So, when you introduce SD-WAN and you introduce all these capabilities, it is very dangerous if you think just, in the old school of one network because suddenly you have IoT working on the same network as maybe your finance department. Or you have productivity facilities working the same network as your network department. So, it just doesn't make sense to have those very different functionalities on exactly the same network because if you have a compromised situation, you suddenly have your entire company compromised and this is really where compartments become very very important. I think this also something you in every industry, historically as well. Security and safety starts also with compartments. So, if you think fire, fire security, it has a lot to do with fire compartments. In case you have a fire, you don't lose the entire building or the same goes with ship building. I mean, Titanic was the last very big ship that sunk but the reason was the compartments haven't been pressurized. A modern ship doesn't sink anymore. And I think this really what we have to do now also in IT. We have to think in compartments. We have to think in layers and that's easy to do with SD-WAN but it's not so easy to operate. >> Final question for you real quick, you know, people talk about hybrid cloud, multi-clouds, the big conversation in this cloud 2.0. But you guys as being successful in outside the United States and now in the U.S., there's also multi-geo work environment. >> Right. What should people think about when they kind of want to frame that debate or conversation? I'm a multinational, I'm operating in the U.S., now I have regions, clouds have regions. There's also all kind of of now regulatory pressure coming across those areas. >> I would say around 2,000 companies really started to globalize their value chains. You know, in the past, maybe you had a production facility in one country and then you sold your products globally but if you want to be competitive, you have to globalize your value chain. So it doesn't make sense to produce everything in one place. Your product usually, or your service, is produced on a global scale and that means that networks also have to help you to really produce that global value chain. But, it means also that you are operating in different jurisdictions, in different regions and you have to respect those different regulations and laws. And this is, obviously then and also a challenge for network operators because privacy in Germany is different than in the U.S., access rights are different, China's again very different, but all those multinationals, we operate in all those countries and we have to respect the local law. >> And the provide the security they need. >> Exactly. >> Martin, thanks for coming in and sharing your insights. Appreciate, good to see you, we'll follow up with and keep of the progress. Thanks for coming in. >> Thank so much. >> I'm John Furrier for CUBE Conversation in Palo Alto, at theCUBE Studios, thanks for watching. (upbeat funky music)

>> from our studios in the heart of Silicon Valley, Palo Alto, California. It is a cute conversation. >> Everyone. Welcome to this Special Cube conversation here at the Palo Alto Cube Studios. I'm John for a host of Cuba here. Moritz man is the head of the product management team at Open Systems A G. Great to see you again. Thanks for coming in. >> Hey, John. Thanks for having me. >> So last time we spoke, you had your event in Las Vegas. You guys are launching. You have a new headquarters here in Silicon Valley. Opened up this past spring. Congratulations. Thank you. >> Yeah, it's a great, great venue to start, and we set foot on the Silicon Valley ground. So to make our way to >> I know you've been super busy with the new building and rolling out, expanding heavily here in the Valley. But you guys were in the hottest area that we're covering Security Cloud security on premise, security. The combination of both has been the number one conversation pretty much in the cloud world right now. Honestly, besides a normal cloud, native cloud I t hybrid versus multi cloud out. See, that continues to be the discussion I think there's no more debate around multi cloud in hybrid public clouds. Great people gonna still keep their enterprises. But the security equation still is changing this new requirements. What's the latest that you guys are seeing with respect to security? >> Yeah. So, John, what we see is actually that cloud adoption had happens at different speeds. So you have usually the infrastructure of the service. Adoption would happens in a quite controlled way because there's a lift in shift. Do you have your old data center? You you take it and you transferred into azure I W S O G C P. But then there's also uncontrolled at option, which is in the SAS space. And I think this is where a lot off data risk occur, especially the wake off GDP are on where we see that this adoption happens. Maurin a sometimes control, but sometimes in a very uncontrolled way, >> explain that the uncontrolled and controlled expansion of of how security and multi cloud and cloud is going because this interesting control means this this plan's to do stuff uncontrolled means it's just by other forces explain uncontrolled versus controls >> eso controlled specifically means the IittIe team takes as a project plan and aches servers and workloads and moves them in a controlled fashion or in a dedicated project to the cloud. But what happened in the business world of business I t is actually did use those share content at any time with any device at any at any time and in all locations. So this is called the Mobile Enterprise on the Cloud First Enterprise. So it means that the classical security perimeter and the controls in that are my past, actually, by the path of least resistance or the shortest path >> available. And this is the classic case. People use Dropbox with some, you know, personal things. They're at home, they're at work, a p I based software. That's what you're getting at the >> and the issue of this is that that the data that has bean, like contained an pera meters where, you know, as it Caesar, where your data is. This has bean deployed too many edge devices, too many mobile devices, and it's get it gets shared, a nun controlled way. >> We'll get a couple talk tracks would like to drill down on that, because I think this is the trend. We're seeing a pea eye's dominant. The perimeter on the infrastructure has gone away. It's only getting bigger and larger. You got I, O. T and T Edge just and the networks are controlled and also owned by different people. So the packets of moving on it that's crazy so that that's the reality. First, talk track is the security challenge. What is the security challenge? How does a customer figure out what to do from an architectural standpoint when they're dealing with hybrid and multi cloud? So first of >> all, um, customers or BC enterprises try need to re think their infrastructure infrastructure centric view off the architecture's. So the architecture that had been built around data send us needs to become hybrid and multi cloud aware. So that means they need to define a new way off a perimeter, which is in cloud but also in the covering. Still the old, so to say, legacy hyper data center set up, which has the data still in the old data center and at the same time, they need to open up and become the cloud themselves, so to say, and but still draw a perimeter around their data and they users and not and their applications and not so much anymore around the physical infrastructure. >> So taking, changing their view of what a security product is, Is that really what you're getting at? >> Yeah, So the issues with the product point solution was that they fixed a certain part off off a tactile issue. So if you take a firewall in itself, firewall back then it was like a entry door to a big building, and you could could decide who comes out goes in. Now. If the the kind of the walls of the building are vanishing or arm or more FIC, you need to come over the more integrated concept. So having these stacked appliance and stacked security solutions trying to work together and chain them doesn't work anymore. So we think and we see that, >> Why is that? Why doesn't it work? Because in >> the end, it's it's it's hardly two to operate them. Each of those points solutions have their own end off life. They have their own life cycle. They have their own AP eyes. They have their own TCO, as all that needs to be covered. And then there's the human aspect where you have the knowledge pools around >> those technologies. So as an enterprise you have to content to continuously keep the very scar security experts to maintain content continues the depreciating assets running right, >> and they're also in it. We weren't built for tying into a holistic kind of platform. >> Yeah, What we see is that that enterprises now realize we have data centers and it's not accepted reality that you can abstracted with the cloud. So you have You don't own your own servers and buildings anymore. So you have a PAX model to subscribe to Cloud Service is and we think that this has to happen to security to so shift from cap ex to our pecs and the same way also for operational matters >> securities. The service is a crepe is a small I want to ask you on that front you mentioned mobile users. How do you secure the mobile uses when they use cloud collaboration? Because this is really what uses expect, and they want How do you secure it? >> So be secured by by actually monitoring the data where it actually gravitates, and this is usually in the cloud. So we enforce the data that is in transit through, ah, proxies and gators towards the cloud from the endpoint devices, but also then looking by AP eyes in the cloud themselves to look for threats, data leakage and also sandbox. Certain activities that happened. There >> are the next talk talk I want to get into is the expansion to hybrid and multi cloud so that you guys do from a product standpoint, solution for your customers. But in general, this is in the industry conversation as well. How how do you look at this from a software standpoint? Because, you know, we've heard Pat Gelsinger of'em were talking about somewhere to find Data Center S d n. Everything's now software based. You talk about the premiere goes away. You guys were kind of bring up a different approaches. A software perimeter? Yeah, what is the challenge for expanding to multi cloud and hybrid cloud? >> So So the challenge for enterprise and customers we talked to is that they have to run their old business. Gardner once called it by motile business, and it's still adopting not one cloud, but we see in our surveys. And this is also what market research confirms is that customers end up with 2 to 3 loud vendors. So there were will be one or two platforms that will be the primary to their major majority of applications and data gravity. But they will end up and become much more flexible with have running AWS, the old Davis Center. But it was the G, C, P and Azure, or Ali Baba glowed even side by side, right tow cover the different speeds at what their own and the price runs. And >> so I gotta ask you about Cloud Needed was one of the things that you're bringing up that just jumps in my head. And when I got to ask, because this is what I see is a potential challenge. It might be a current challenges when you have kubernetes growing such a rapid rate. You see the level of service is coming online much higher rate. So okay, people, mobile users, they're using the drop boxes, the boxes and using all these FBI service's. But that's just those wraps. As a hundreds and thousands of micro service is being stood up and Tauron down in there, you guys are taking, I think, an approach of putting a perimeter software premieres around these kinds of things, but they get turned on enough. How do you know what's clean? It's all done automatically, so this is becoming a challenge. So is this what you guys mean when you say software perimeter that you guys could just put security around things at any time? Is that explain this? >> Yeah, So? So if you talk about the service match so really mashing cloudy but native functions, I think it's still in the face where it's, I would say, chaos chaotic when you have specific projects that are being ramped up them down. So we draw a perimeter in that specific contact. So let's say you have You're ramping up a lot off cloud a function AWS. We can build a pyramid around this kind off containment and look especially for threats in the activity locks off. The different component is containers, but from from a design perspective, this needs to be, uh, we need to think off the future because if you look at Mike soft on AWS strategy, those containers will eventually move Also back to the edge. Eso were in preparing that to support those models also cover. Bring these functions closer back again to the edge on We call that not any longer the when, ej but it will become a cloud at at actually. So it's not an extension of the land that comes to the data. It's actually the data and the applications coming back to the user and much closer. >> Yeah. I mean, in that case, you could define the on premises environment has an edge, big edge, because this is all about moving, were close and data around. This is what the new normal is. Yeah, So okay, I gotta ask the next question, which is okay, If that's true, that means that kubernetes becomes a critical part of all this. And containers. How do you guys play with that at all? >> So we play with us by by actually looking at data coming from that at the moment. We're looking at this from a from a data transit perspective. We But we will further Maur integrate into their eighties AP eyes and actually become part off the C I C D. Process that building then actually big become a security function in approval and rolling out a cannery to certain service mesh. And we can say, Well, this is safe for this is unsafe This is, I think, the eventual goal to get there. But But for now, it's It's really about tracking the locks of each of those containers and actually having a parent her and segmentation around this service mash cloud. So to say, >> I think you guys got a good thing going on when you talk about this new concept that's of softer to find perimeter. You can almost map that to anything you get. Really think everything has its own little perimeter workload. Could be moving around still in these three secure. So I gotta ask on the next talk Trek is this leads into hybrid cloud. This is the hottest topic. Hybrid cloud to me is the same as multi cloud. Just kind of get together a little bit different. But hybrid cloud means you're operating both on premises and in the cloud. This is becoming a channel most si si SOS Chief admission Security officers. I don't want to fork their teams and have multiple people coding different stacks. They don't want the vendor lock in, and so you're seeing a lot of people pulling back on premises building their own stacks, deploying in the cloud and having a seamless operation. What is your definition of hybrid? Where do you see hybrid going? And how important is it? Have a hybrid strategy. >> So I think the key successfactors of a hybrid strategy is that standards standardization is a big topic. So we think that a service platform that to secure that like the SD when secure service platform rebuilt, needs to be standardized on operational level, but also from a baseline security and detection level. And this means that if you run and create your own work, those on Prem you need to have the same security and standard security and deployment standard for the clout and have the seamless security primary perimeter and level off security no matter where these these deployments are. And the second factor of this is actually how do you ensure a secure data transfer between those different workloads? And this is where S T win comes into play, which acts as a fabric together with when backbone, where we connect all those pieces together in a secure fashion >> where it's great to have you on the Q and sharing your insight on the industry. Let's get into your company. Open systems. You guys provide an integrated solution for Dev Ops and Secure Service and Security Platform. Take a minute to talk about the innovations that you guys were doing because you guys talk a lot about Casby. Talk a lot about integrated esti when but first define what Casby is for. The audience doesn't know what Casby is. C. A S B. It's kicked around all of the security conscious of your new to security. It's an acronym that you should pay attention to so defined casby and talk about your solution. >> Eso casby isn't theory. Aviation means cloud access security we broker. So it's actually becoming this centralized orchestrator that that allows and defines access based on a trust level. So saying, um, first of all, it's between networks saying I have a mobile workforce accessing SAS or I s applications. Can't be it in the middle to provide security and visibility about Where's my data moving? Where's married? Where do I have exposure off off GDP, our compliance or P C. I or he power risks And where is it exposed to, Which is a big deal on it's kind of the lowest level to start with, But then it goes further by. You can use the Casby to actually pull in data that that is about I s were close to toe identified data that's being addressed and stored. So are there any incidentally, a shared data artifacts that are actually critical to the business? And are they shared with extra resource is and then going one step further, where we then have a complete zero trust access model where we say we know exactly who can talkto which application at any time on give access to. But as everything this needs to be is in embedded in an evolution >> and the benefit ultimately goes to the SAS applications toe, have security built in. >> That's the first thing that you need to tackle. Nowadays, it's get your sass, cloud security or policy enforced on, but without disrupting service on business on to actually empower business and not to block and keep out the business >> can make us the classic application developer challenge, which is? They love to co they love the build applications, and what cloud did with Dev Ops was abstracted away the infrastructure so that they didn't have to do all this configuration. Sister. Right? APs You guys air enabling that for security? >> Exactly. Yeah. So coming back to this multi protein product cloud would, which is not keeping up anymore with the current reality and needs of a business. So we took the approach and compared death ops with a great service platform. So we have engineers building the platform. That's Integrated Security Service Platform, which promotes Esti Wen managed Detection response and Caspi Service is in one on the one platform which is tightly integrated. But in the in the customer focus that we provide them on or Pecs model, which is pretty, very predictable, very transparent in their security posture. Make that a scalable platform to operate and expand their business on. >> And that's great. Congratulations. I wanna go back for the final point here to round up the interview for the I T. Folks watching or, um, folks who have to implement multi cloud and hybrid cloud they're sitting there could be a cloud architect that could be an I T. Operations or 90 pro. They think multi cloud this in hybrid club. This is the environment. They have to get their arms around. How? What >> should they >> be thinking about? Around multi cloud and hybrid cloud. What is it, really? What's the reality now? What >> should they be considering for evaluation? What are some of the key things that that should be on their mind when they're dealing with hybrid cloud and all the opportunity around it? >> So I think they're they're like, four key pieces. Oneness. Um, they think they still have to start to think strategic. So what? It's a platform and a partner That helps them to plan ahead for the next 3 to 5 years in a way that they can really focus on what their business needs are. This is the scalability aspect. Secondly, it's a do. We have a network on security, our architecture that allows me to grow confidently and go down different venues to to actually adopt multi clouds without worrying about the security implication behind it. Too much, uh, and to implement it. And third is have this baseline and have this standardized security posture around wherever the data is moving, being at Mobil's being it SAS or being on Prem and in clouds workloads, the fourth pieces again, reading, thinking off where did you spend most of my time? Where do I create? Create value by by defining this framework so it really can create a benefit and value for the enterprise? Because if you do it not right your not right. You will have a way. You will end up with a an architecture that will break the business and not accelerated. >> Or it's made head of product that open systems here inside the Cube studios. Um, great job. Must love your job. You got the keys. A lot of pressure. Security being a product. Head of product for security companies. A lot of pressure before we wrap up. Just give a quick plug for the company. You guys hiring you have a new office space here in Redwood City. Looks beautiful. Give a quick shared play for the company. >> Yeah. So open systems the great company to work with. We're expanding in the U. S. On also, Amy, uh, with all the work force. So we're hiring. So go on our website. We have a lot off open positions, exciting challenges in a growth or into workspace. Andi. Yeah. As you said, security at the moment, it's one of the hottest areas to be in, especially with all the fundamental changes happening in the enterprise and architecture. I d landscape. So yeah, >> and clouds securing specifically. Not just in point. The normal stuff that people used to classify as hot as hot as Hades could be right now. But thanks for coming on. Strong insights. I'm jumping with Cuba here in Palo Alto with more Morris Man is the head of product management for open systems. Thanks for watching.

>> Narrator: From San Francisco, it's The Cube. Covering Samsung Developer Conference 2017, brought to you by Samsung. (upbeat music) >> Okay, welcome back, everyone. Live here, in San Francisco, for day two. We're winding down day two of two days of wall to wall coverage, The Cube's exclusive coverage of Samsung Developer Conference. I'm John Furrier the founder, co-founder of SiliconANGLE Media (mumbles) the Cube our next guest Larry Cutler, co-founder and CTO of Baobab Studios. >> You got it right. >> And you're co-founder and CEO Maureen Fan was at our Grace Hopper event. >> Larry: Yes. >> Well thanks for joining us. >> Thank you for having me. >> So you guys are doing great. Love the story-telling, gaming, tech culture coming together here at Samsung. >> Yep. >> And seeing the future. The future, if you connect the dots, is augmented reality voice-activated, headphones that can be hacked and programmed and customized. You guys are doing some interesting things, you've got some good awards. Take a minute to talk about your studios. What are you guys doing, what's the aha moment for you guys. What should people know? >> So we at Baobab Studios, we're reinventing animated storytelling using VR. And so what we've, our aha moment was feeling that you could completely immerse yourself in the world in VR. And when we started thinking about well what is so special about an animated film, it's really about transporting you to faraway worlds, and making those worlds so real that you could like reach out and touch them. And then if you think about VR, that's kind of the same thing, where VR's promise is being able to transport you to incredible places and to make you really feel like you're in those worlds and you're part of those worlds. >> And to relax and chill a little bit too. >> Well relax and chill as well. >> Or entertainment or to be thrilled. >> So in our case we wanted to take all the experience that we have telling stories at places like Pixar and Dreamworks and apply that into this new medium. And so we found that VR is an incredibly powerful medium, and it really is one that's unlike film and unlike games. So, you're talking about bringing together the expertise of people from films, and people from games. That's critical to what we're doing, and yet at the same time, the experience is something that's totally different. >> Yeah we were commenting with some of our guys in our office how Twitch was experimenting with using the comments to drive the game behavior. You start to see new kinds of game systems develop around the storytelling as more of a behavioral dynamic, not the boring game I figured out, or the multi-player game with my same friends, or whatever that's going on, you're seeing a whole new level of creativity going on, one. Two, the other question is how much does it cost to make these things, 'cause Dreamworks and these guys are spending a lot of dough to do animation. >> Larry: Yes. >> I mean it's not cheap, so how do you guys crack the code on keeping it low, not low-budget, but low-cost and also intelligent is that the secret sauce? >> Yes well that's certainly super important for us. You know we're a start-up company, so obviously we need to be able to have a pipeline that if we run efficiently and you know for us, I think what we've done is we've brought together some of the best people, you know. So we've hired our friends, we've hired people who are really experts in the field, and we're really creating a next-generation VR platform so that we can actually create these animated experiences, be able to experiment in this space. You know, sort of try out different techniques and storytelling methodologies and at the same time do it in a way that we can, you know, sort of experiment as much as possible. >> John: Talk about some of the awards you guys had, I mean, you guys done some things. Share some of the accolades you've gotten. >> Yes, so, I mean what's amazing is that we started with our first piece of content Invasion!, and we premiered it last year in April at Tribecca Film Festival, and it's really gone on to, first of all, from a consumer standpoint, it's one of the most popular downloaded pieces of content on all the VR platforms, and at the same time it's been shown at a number of different film festivals, and it recently won an Emmy, so we're very excited about that, and, you know, what we realize is that audiences just fell in love with this bunny character Chloe. So Invasion! is this story about two aliens that try to take over Earth, and they're thwarted not by humans with powerful weapons, but by cute little woodland creatures. In the first episode in Invasion! they're thwarted by this cute little bunny Chloe, and what happens is that at the very beginning of the piece, Chloe like hops up to you, and if you look down you're a little bunny in the scene, you've got bunny legs, you can hop around. And audiences, you know, the viewer just reacted in ways that you would never do in a film, like people are waving at Chloe, a lot of people reach out and try to pet Chloe, a lot of people mimic what Chloe's doing, and in short people are just treating Chloe as if she's real. And it made us realize that there's something really powerful here that is really worth kind of leaning in and digging deeper into. >> And what was the next step after that, so you went what you went, some development, was it the game, was it the character development? How do you double-down on them, I'm just kind of curious on thinking about how the, on the thinking behind it. >> It was really interesting because we, in Invasion! we were kind of the first to make you a character in the story, but at the time there really weren't hand controllers, or any of the devices so that you could actually really have sort of a more like increased role in the story. And so at the same time, people really felt that they were front and center, and they felt this sense of protecting Chloe from the aliens 'cause you're placed right in the center of the story. And so with Asteroids! when we started, we just wanted to dive deeper into that idea of you playing an active role in the story. And so in Asteroids! we focused on the two alien characters Mac and Cheez and their relationship, and you're a helper robot on the ship, so you have. >> So how do I get involved and get these stories, do I have to have a VR kit? So I don't have, I haven't bought anything yet VR-wise, so for me, how do I engage with you guys, what do I do? Do I buy Oculus Rift, or certain headsets? >> So our stuff is meant to be available for everyone. We really want to have as many people be able to see our content as possible. And so first of all, if you have a VR headset of any type, our, Invasion! is available on all those platforms, so that's the high-end headsets like the Rift and Vive, the PlayStation VR for Sony, as well as if you have a mobile phone like a Samsung phone, you can plug it into your VR. At the same time, we also have a Baobab Cardboard app, so you don't even need to have VR to see our product. So you just get an IOS or Android app, a Baobab app. >> So I'm in the market to buy a headset, I'm not price sensitive, what should I buy? What would you recommend? (Larry chuckling) >> Well there really are so many options, so you know obviously at the high >> John: What would you get? >> Well at the highest end, you know, getting a Rift or Vive really gives you the full VR experience because it's really tracking your position and orientation so you can actually walk around a space, the characters can react to you in believable ways, and it's all happening in real time. And on the other hand, the Sony PlayStation VR's are really affordable if you've got a Sony Playstation, you just buy the PSVR headset, you plug it right in and you're ready to go. I'm really excited looking forward to a world where you're not tethered to your computer, and so it's really exciting to see these stand-alone headsets that are going to come out that basically there's no tethering to a computer and yet you have that same inside-out tracking so that >> And this is the Samsung vision, right? The Samsung vision is to use their displays. >> Yes, exactly. See right now what you have, which is, which is already really exciting, is you take your Samsung phone, you plug it into a Gear VR, and the one thing that's missing is that you're not able to track both the position and orientation of where you are, and so the next generation headsets are going to have that. And the experiences will be much higher feeling. >> Alright cool, so then I, I'll actually download all of this stuff. So as the CTO of the venture, your job is to kind of look over the landscape. You have to have the 20 mile stare of the future, not screw it up, but you've got to win the present. >> Larry: Yes, we're all about being able to deliver in the present and look forward to the future. >> And that's the key, and you have that unique skill as an entrepreneur. What are you guys doing now technically and with the product, what are some of the key things that people should know about, because I mean I look at the CG and the animation world, and you see the Moore's law kind of coming that way, right, so you go wow, as someone with a live video, I would love to have a bunny and the cube set right here, right? So we see a future where I want to immerse myself with characters, not just stickers. >> We of course see that as well, so you know, obviously. >> John: Is expensive I mean it must be, 'cause in the old days what, you had the artists, monster storage, tons of compute, what's it like now? >> Well we're a really small start-up company, so we are not a, you know, 300 person organization that is producing a full animated film. We're a small team of artists and engineers working together in the same way that we had that same excitement in the early days. I started my career at Pixar in some of their earlier films, and it was that same >> John: Power work stations, you had that high-end gear. >> Yeah so it was that same excitement in those early days, like we just had to figure out like how are we going to actually create this shot, how are we going to like, you know, build this character, how are we going to like finish this on time. And we have that same exact excitement in the office. >> When were you at Pixar, were you there for the Toy Story kind of thing? >> Yeah, so I worked on the Toy Story films, and A Bug's Life and Monster's Inc., and then I went over to Dreamworks and headed up all of their character technologies on their various films. >> Okay so you guys do anything different than those guys, or are you guys more focused more simple? >> Yeah, I mean what's interesting is that this is really a new medium and it's a new skill set, because what's happened is that you are part of the world, and for us the thing that's most exciting is that by you being a character, first of all, the other characters are not just able to have, you know, sort of high-quality animation, but they're able to react to you, and so there's there A. a number of technical innovations that you need to overcome so that we can have that same high-quality character performance that I would expect from a Pixar or Dreamworks film happening, running in real time at 90 frames a second on my headset, and at the same time also be able to have those characters react to you and respond to what you're doing. And you know, so we've scratched the surface on that. So one of the things that's really interesting is how two people will actually have all these subconscious communication cues, you know, whether it's eye contact or whether it's two lovers sitting across the table and mirroring each other's behavior, that's the type of thing that we can add into our animation. And at the same time, we have stories where depending on what you do, whether you choose to participate or not, that actually affects the outcome, and affects the way that characters respond to you. And so having much smarter character performances is certainly one area that I think is really exciting. >> And that's going to be interesting for you guys because you have some structured ways to do that, and then some unstructured ways to do it with community data, machine learning, and then you can use bots in a way to help you get data, but you almost could have character developments be dynamic. >> You definitely could, and you know for us I think the thing that is always the biggest point that we come back to is story. And so on one hand we want to tell one story that's really told well, not ten different stories, and on another hand, because you're part of that story, depending on what you do, that's actually going to affect how the characters respond to you, and that could be in a really nuanced way, and so, you know, building up AI systems, and building up the smarts so that you can actually have that type of response, and yet still feel like these characters are alive and breathing. >> Well the Chloe example on Invasion! is great example, you'd love to have that automated, so when you see those magical moments, the story could evolve, you can kind of give it that programmable policy-based taping. (John laughing) >> Yeah exactly so you know, so this is the type of thing. >> We're geeking out here on the set, Larry, great to have you on, super informative content, and I love the world you're in, I think the world's changing, I think you're going to see some interesting dynamics coming, you certainly have the historical view, Pixar and Dreamworks, old school, if you call that old school. >> That's right. >> Now the new school's coming in, certainly AR looks good too. >> Yeah, we're really excited about AR as well. When we think about stories, you know, VR is about transporting you to a different world and having a story take place there. AR is about the characters being alive in your world, both are really exciting. >> Have you seen the Magic Leap demo? >> Larry: Yes, yeah. >> What's it like, can you tell us? >> I'm not allowed to tell. >> John: Is it good? >> Yes, yeah. >> So it's worth half of another half a billion, oh I can't wait. >> That I can't say, you know. I can't comment on their business, but. >> It's a freaking award chest. >> I think there's a lot of exciting things you know, AR. >> They must have a killer demo, I want to find out, I want to see this demo. Magic Leap, I want to to see your demo. All seriousness, great to have you on, and certainly come down to our Cube studios. I want to follow your story, I think you guys are on the cutting edge of a new user experience that's going to bring computer animation, computer graphics, into a new persona as a storytelling, so congratulations. Larry Cutler, how do you say the. >> Baobab. >> Baobab, B-A-O-B-A-B Studios in Redwood City, California. It's the Cube live coverage from Samsung Developer Conference, I'm John Furrier, more after this short break. (peppy music)

>> Narrator: Live from Las Vegas, it's theCUBE. Covering Oracle Modern Customer Experience, 2017. Brought to you by, Oracle. (upbeat music) >> Welcome back to theCUBE. I'm Peter Burris, and once again theCUBE is here at Oracle Modern Marketing... Modern Customer Experience, having a great series of conversations about the evolution of marketing, the role technology is playing, and especially important, the centerpiece that data now has within a overall orientation towards customer experience. Now one of the key features of that notion of customer experience is what's going on with service. And this is a great session, because we've got a representative from Oracle, but also a customer, as well. Welcome to Steve Fioretti, who's the VP of Product Management, Oracle Service Cloud and Heather Miksch, who's the Vice President of Field and Product Operations at Carbon. >> Thank you. >> Peter: Welcome to the (mumbles) >> Thanks. >> Glad to be here. >> So, Steve why don't we start with you. >> Steve: Sure. >> Oracle is here talking about how the cloud can help transform field and service operations. >> Steve: Right. >> How is it transforming it, what're the trends? >> Well, there's a lot of interesting trends that are affecting customer service, and I would, you talked about marketing and a lot of people say customer service is the new marketing. A lot of, a lot of interactions that people have with a company is in the customer service group and that really affects their impact on the brand. And there's a lot of things going on in the industry that are affecting customer service. There's new dynamic channels emerging, for example, people want to use Facebook Messenger, or WeChat, or WhatsApp as customer service channels to interact with their brand. It's much beyond just email, phone, chat, things like that. So, new channels are emerging and companies have to think about how do I integrate that into my customer service organization. Automation has really come into the fore. So, you know, in our personal lives we use Siri, and other V, you know, interactions we have with Alexa. So, those are coming into businesses to automate those, perhaps more simple, customer service processes. The internet of things is really taking off, where connected devices are allowing organizations to deliver predictive and proactive service. And on the automation front, they're even extending to where organizations are taking robotics and making robots agents in a retail store, for example. >> Are you talking about me? >> Wow it's Pepper. Hi, Pepper, what are...(Peter laughs) I didn't know you were here, that's awesome. So, Pepper, I'll ask you a question. What makes you a great Customer Service Agent? >> I'm smart, I'm connected, and I'm cool and, most importantly, I'm effective. (Steve laughs) >> And we replaced John Furrier with Pepper. >> Steve: Excellent.(Heather laughs) >> So, going to the next question about the, as we use robotics, as we use many of these things: we have to remember that these are not magic, they're really is no intelligence, in the classical sense, in them, they are still being driven to perform functions, take action, based on the availability of data that is coming off of customers. So talk a bit about the role the data, data integration, and some of these new tools: AI, or Adaptive Intelligence as you're calling it, are playing in ensuring that we can, enhance Customer Experience with new devices, and these new channels. >> You're absolutely right. I mean, if, you know, it's all about making the experience with a device like, like Pepper personalized and effective, and data, knowing what a consumer wants, what their preferences, and perhaps anticipating their preferences before, you know, they even know that; their past buying history, and taking all that, first-party data and third-party data, combining that with artificial intelligence, to deliver those personalized smart experiences is what's really happening. You heard a lot at this conference about Oracle's Adaptive Intelligence Initiative, and in the context of service, we're going to be building applications for things like account health, predictive field service, so, you know, you can predict ahead of time that a machine may, you know, may need service or break. And, you know, our customer here, Heather from Carbon is going to talk a lot about what they're doing with-- >> Well, so-- >> You know, smarts and the experience-- >> Got it, so how does this resonate with Carbon? >> Well, so, Carbon, is a, we manufacture an industrial 3D printer, and we have a process we call Digital Light Synthesis, which allows us to make photo-polymer materials that are robust enough to use in final production. So, our goal is to take customers from their design, of their part, straight into production, using the 3D printer as a means of production. And the reason why this is so exciting to Carbon, is our printer is actually an IOT device. It operates over the internet, and it operates through a browser. As a result, all types of data, from machine data from the printer, are flowing into our databases; as well as operational data, how long is the print taking, what type of resin is the customer using, how often are they printing, are they running into problems with their print? We've also built in a feedback system for the user, directly in the user interface, that flows directly through our channels into our databases, and it actually opens tickets in our Oracle Service Cloud for agents to contact the customers. The way we use this in a very practical standpoint, to give you one example, is for machine failures. The idea that we can monitor our printers in the field, and we can see if a part is having problems, and might fail, and we can actually proactively reach out to the customer and say, "We'd like to be there "in a couple weeks, change out this part. "It's not affecting your machine yet. "It's not affecting your prints." And, the customer is now able, instead of having unplanned downtime, which can be very difficult for a production environment, they now have planned downtime. This technology is nothing new. The example I like to use is, in the nuclear power industry, you don't wait until you have a core meltdown and then call your service engineer.(Steve laughs) Like, it's been around for for decades. >> Form has been around for a while. >> But what's new, is actually taking this technology and putting it in capital equipment, or putting it in devices like Peppper. I mean, she's also an IOT device; or even putting it into some of our wearables, or just other consumer products as well. And once you actually have this data coming through to the manufacturer of the device, it's really almost limitless what you can do with it. And, just in our short time of Carbon actually working on this problem, we have about 70% of our hardware failures are actually predictive. So that we're able to go out and repair the printer before the customer even realizes they have a problem. And some of the problems, we can actually fix before the customer knows anything, and we can fix them remotely from our offices in Redwood City. >> And it's interesting, theCUBE this week was also at the National Association of Broadcasters, in the NEB show, and we actually had an astronaut present over theCUBE. >> Yes, yes. >> One of the things that's interesting is there are 3D printers now on-- >> There are. >> Up on the Space Station. >> Yes, yes. >> So that you can print things a long ways away. That's one of the advantages, one of the great use cases of 3D printers >> Yes. >> Is that you can actually assemble, or you can create and assemble things, in very very, you know, unfriendly environments. >> Yes, yes. So, being able to schedule, and being able to plan that, is absolutely essential. >> Yes, yes and you can see, so for us, for 3D printers, some of the use cases that our customers are coming to us with, is they are companies, their own capital equipment manufacturers that have hundreds of thousands of spare parts, and they don't want to have to keep these inventories of massive spare parts. They want to have a design sent directly to a printer, maybe it's located in another country, closer to the point of use for that part, print out the part, and get it to the user faster. The idea is to actually move, one of the ideas, is to move manufacturing closer to the point of use. So that we're not spending all this time shipping products, you know, across the entire world, when we can actually be producing them much closer to the user. >> So that suggests, when we think about, again, the role of integration, the role of data, the idea of the Service Cloud; that there will be circumstances in which the part is printed and the capital equipment, Lessor, or the person who sold it, is on site to then put it in place, and assemble it. So now we're talking about multiple people operating very very quickly with a lot of new technology. >> Right. >> And, we now see why these types of devices and the need for that data sharing is so crucial. So, how is Oracle, in Oracle's vision of how service is going to be performed in the future, facilitating these types of interactions. >> So, I mean what we have to do is think about the technologies that are powering devices like robots, that are, providing technologies that are powering virtual assistants to automate customer interactions, to deliver technologies that help customers serve themselves. Another example is, more and more people, particularly younger generation, they don't want to phone. You've got a phone in home, they don't want to call you. They don't want to have anything to do with the phone. So, that's why things like messaging, self-service, going to a website and finding their own answer are critical. So, enabling and anticipating the data, the technologies, the way, the channels that people want to use, are all going to allow brands like Carbon and others to deliver great customer service for-- >> How are you using the Oracle Service Cloud, then, to facilitate many of these changes in your organization. >> So right now, what we have is for... We actually have a database we use for our big machine data. So, all the big machine data comes through, all the data coming off of our printers. And then we've integrated that database into Oracle Service Cloud; so then, instead of a customer having to phone up if they have a problem, we actually have, on our user interface, a little button, it just says "Request Help", that's all they need to do, and it's within the print job that they've been working on. All of that data about their print job: who the user is, what the company is, which printer they were using, how long was the print. Any specific information they want to say about the print, like why they're having trouble with it, it flows through into Oracle Service Cloud, and within the Oracle Service Cloud environment we can open up our big machine database, within that same environment, we can look at the actual print job. And then, we have an escalation tool we use for our engineering team. If we need to escalate, we can do that out of Service Cloud as well. And the idea is that there's very little manual entry of any other information. All of that is just flowing through, and everybody within the organization, whether it's the people that are first in front of the customer, or whether it's our engineers, have access to the exact same data. >> But is the system also then, through the escalation process, saying, well, we really got to get someone at the hardware level, or someone here, or someone at the design level. So you're flowing it to the right person. >> Yes, yes, absolutely. And the other fabulous thing about having these internet connected devices, is even when we do need to send somebody out on site to make a hardware fix, because of the diagnostic data we have from the device, we have, until now, 100% success rate in having the right part on-hand. Which is, if you've ever had much experience with capital equipment repairs, or even a repair of your dishwasher, sometimes the people don't have the right parts. We always have the right parts. >> That's too bad you couldn't >> So far, nothing-- >> print the part with the printer when it's down.(laughs) >> That's an interesting thing. We actually do have some parts within our printer that are printed on our printers, so its (laughs) it's pretty fun >> Can I talk about one other short example-- >> Of course. >> Of another customer that actually Heather's met here at the show, Denon & Marantz, so, they make all sorts of audio equipment, high-end audio equipment, and they've got a new brand of speakers, wireless speakers, called HEOS. And, when they first started, selling those to consumers they noticed, these are connected as well, they noticed that a number of them were having, a chip problem, remotely. People were calling in. So they went out, and they, they pinged, if you will, because they're connected, all of their consumer deployments, and they could tell that, you know, a small percentage of them are going to fail. They actually shipped speakers to those consumers before they even knew they had a problem, and they arranged to pick up the old ones, and you can imagine the value the customer, loyalty, and customer sat that that had. So that proactive predictive customer service example in the consumer world, and in a business world, really makes service that much-- >> Yeah. >> So, customer service, increasingly, is taking some degree of responsibility for ensuring that things operate within the threshold, as opposed to fixing things after they've broken. >> Yes, absolutely. >> Exactly. >> Heather: Yes, yeah. >> So how does that tie back into marketing and sales. So, at Carbon what is the, what is the way these feedback loops are being used to also inform marketing and selling. >> So, the interesting thing is that because we're also gathering operational data, we actually use the data coming off our printers for much more than just a service organization. In fact, our entire company is becoming more and more dependent on this printer data. So, for instance, our product group, when they're looking at bringing out a new feature they're actually looking at the data of the actual prints and the features that the customers are currently using, and deciding, do we need to augment this feature? Do we need to bring out another tool for our customers to use? And then looking at the printer data to make those decisions, and to prioritize what projects to work on because as you can imagine we've just got a ton of projects that we'd like to work on, and we need to make some priorities. The other thing that we're looking at is changing customer dynamics. Like we have, all of our customers are broken down into different industries, and we monitor the different printing behaviors, across industries, and we've been surprised. Like, there's certain industries that have grown faster than we would have expected, and because we've got this data that we look at every single day, we're looking at our customers' print data, we can actually make much faster corrections to either marketing campaigns, or sales strategies, or things like that, rather than waiting for a monthly roll-up or a quarterly roll-up or something like that. >> So who's the steward of data within Carbon? >> Who is the steward of data? We actually have a Director of Business Operations, his name is Chris Hutton. He actually works a lot with Oracle. He recently spoke at the Modern Finance Experience with Safra Catz, and I would say that if anyone's the steward of the data, he's probably the Grand Poobah of this data? But many of us have access to it. I mean, I can go into some of these databases and pull all the data I need. We don't really restrict it. >> But he's making sure that every, he's making sure that the data works for everybody in the organization. >> Yeah. Yeah, I'd say to some degree, yes. We also have our software engineers, making sure the printer data is actually-- >> Well, they're always... >> Heather, I think I would... >> Always behind the scenes. >> I think I would like the title Steward of Data. >> Yeah. (laughs) >> I think that's, I think I just found my new title. >> It's a little geeky.(laughs) >> Well it won't be long. Somebody's going to be called, and-- >> Exactly. One other quick example of how that feedback's happening between a customer service experience and let's say marketing, is, back to my Denon & Marantz example. They had another set of speakers, and they can tell, they often, the consumer will label the speaker, based upon, you know, this is the living room, this is the bedroom... And they had some failures on another brand of speakers, and they noticed a commonality, they were all labeled Bathroom. And, basically, they realized that their speakers... Some of these speakers couldn't handle the humidity that was happening in the bathroom; drove that back into product development, built a new series of speakers quickly for bathroom that were more waterproof, >> Yeah. >> Or, more moisture resistant, and created a new product extension that actually sells quite well. So, there's just a simple example of how that data flowed back into product development and marketing. >> So, Heather, you're not feeling like a fish out water here at a customer experience show with all of the-- >> Oh, no, of course not. No, I love this kind of stuff. >> What's exciting you about listening to, mainly marketers, but a lot of customer experience, too? >> I, you know people-- >> Talk about customer service >> That are in service, they get excited. I mean, fundamentally, there's all kinds of reasons for growing the business, and increasing revenue, and cutting costs, and all those things, but fundamentally, people are in service to help other people. Like, that's what gets us up in the morning. That's what makes us jump out of bed. So, the idea that there's all these companies doing these super-cool things, where you can, really, proactively be helping people instead of waiting till they're already in trouble. That's like, you've just burst through a barrier that's existed for millennia; the fact that we can actually start predicting problems. >> But that's also, we also talked a lot here on theCUBE this week about the role that talent's going to play. And, while I've never been in a hardcore customer service job, I know that people who have gone in, often got demoralized because they were always being yelled at because there was problem. >> Yes, yes, yes. >> And I had to believe it's attracting a new class of person because they can actually be participating, and anticipating, and solving problems >> Yes, yes, yes. Well, and I, it does take a certain type to be a customer, to be in front of customers all the time. We always say that the number one rule is you have to hire happy people to be put in that position, because (laughs) >> Peter: So, how about (Heather laughs) >> Actually, that was a very insightful question, because we were on a panel yesterday with an analyst, Denis Pombriant from the Beagle Research and he talked about, well, a couple of dynamics. One is, agents, the profile of the agents that you hire is changing. Because all the simple things are being solved online through self-service, and now that agent has to be a more gifted, even arguably, he called it a controller, a more aggressive agent that's going to be a problem-solver, able to collaborate with others. So, more empowered, and that's one thing, so I thought your question was really insightful. The nature of that agent is changing. And another thing that smart companies do, is they empower those agents. You know, not just with technology, but they give them the ability to, you know, the a brand of hotels, high-end hotels, I won't use the brand, but their agents are given a couple thousand dollars a day, and are empowered to use that to fix any issues. You know, somebody shows up and the room's booked, they don't drag them out of the hotel. (all laugh) They actually find them... Maybe they upgrade the room or they get them a meal if they have a problem so, empowering them also makes the agent feel much better about delivering customer service-- >> Alright, so Steve Fioretti, VP Product Management Oracle Service Cloud. Heather Miksch the Vice President of Field and Product Operations at Carbon, and Pepper from SoftBank. >> Yay! >> Thank you all for being a part of theCUBE here at the Oracle-- >> Thank you. >> Modern Customer Experience >> Thank you Peter. >> And talking about the role that service is now playing in driving customer experience and the role that the Cloud is playing in improving customer service. >> Steve: Great, awesome. >> We'll be back with a wrap-up in a few minutes, and in fact, John will magically reappear. Give us a few minutes and we'll be back with more from theCUBE. (upbeat music)

>> Announcer: The Cube presents On the Ground. (techno music) >> Hello and welcome to a special Cube presentation of Oracle On the Ground here at the headquarters in Redwood City. I'm John Furrier, host of the Cube. I'm here with Karen Sigman with Oracle. Great to see you again. Give us an overview what we're doing here with this program. What's the update with Oracle with Big Data and cloud? >> It's pretty exciting, you know. We've been continuing to innovate as you know. We've been expanding our portfolio and the big focus is on choice. So with the Big Data appliance and the Big Data now taking that to the cloud at customer strategy, we're able to now give customers choice of doing their Big Data analytics on premise, in the cloud, or as a cloud service behind their firewall. It's a huge innovation, a whole new change to the way you can do things for our customers. >> So about the operational impact to customers for this, because on premise obviously is key. Cloud economics are right there. But getting something operational has been a big problem for many people with Big Data. How does the Oracle solutions innovate and help solve that problem? >> Well, I think that's the whole value proposition around what we've done with the Big Data plans. What we heard from a lot of our customers is they can build their own, and they can put it all together, but then they have to maintain it. They have to manage it. They have to make sure that everything that they, all the software that they put together, is going to work together. And they're going to be able to keep it up to date. We actually eliminate all the steps. A vast majority of the steps it takes to bring it up online. So we can bring the time to value for doing your data analytics down to days instead of weeks. >> What do you say to customers that have come to you, Oracle customers and potentially new customers, "Hey I have Oracle database" or "I'm considering Oracle database, but I have to use Hadoop. I want to use Hadoop and some of these open source technologies. Can I do that?" >> Of course you can. Oracle is absolutely all about choice. It's the ability for you to be able to use both Oracle and non-Oracle source data in a single appliance and do your analytics against that. That's the value of the Big Data plans. >> What about cloud? The cloud machine? How does that fit into this? >> Yeah, it's all again, it's about, you know, making sure a lot of customers have different ways that they want to do business. They're worried about data sovereignty issues. They can't take it to the cloud, but they want the ability and the agility that goes with a cloud story. The ability to just access a service and run it. What we're doing with the Big Data cloud machine is we're actually allowing customers to take that cloud service and access it just behind their firewalls. So it's the same as if you're logging in to our public cloud. You just log into it in your own data center. >> Karen, so you've been traveling around the globe talking to customers. What are the main things that you're seeing bubbling up from the different conversations from all around the world? Top three things you're hearing from customers? >> I think it's a couple things. One, they don't want to spend their time becoming IT experts anymore. And so the value of an appliance like technology or a cloud service, either one, is exactly what their looking for. Because they want to simplify their IT infrastructure and they want to focus on the things that matter most, which is the applications that drive the business. So that's number one. Number two is they're worried about cost. And so they would like to have cost be specific and more transparent. So they want to make sure that whatever their spending they can actually allocate back to the business units, that's coming from the IT side. So having cloud based models actually helps quite a bit with cost transparency. And I think the third thing is that overall they want to make sure that they can get things done faster. And so the idea of having cloud services gives them that agility that they need. And as I know you only asked for three, but I would say the fourth thing is they're looking for choice. They really want to understand. They want to make sure that if they choose one model, that they're going to be able to flip and they're not going to be locked in. And what Oracle's done with this is given them the capability to either deploy on Oracle, work with Oracle or non-Oracle data, and you can do it on a cloud or you can do it on prim. It's all up to you. >> I sat down with Dave Donatelli for an exclusive interview and then publishing on Forbes and then SiliconANGLE, and he talked about how the traditional infrastructure mainly storage and server vendors, really weren't positioned for success. So I want to ask you, a year now into the Oracle real push and growth of infrastructure products, engineered systems and other things powering all the software and the database and all the good stuff with Big Data cloud. What's changed over the past years? What can you point to has been the big, you know, the needle moving? Was it been performance? Has it been hardware? Number of units? Integration? What's your view on where has the needle moved for the infrastructure engineered systems? >> I think the big thing is that we've really fill out the portfolio. We've made sure that whether you're choosing to do a build your own solution or go for the, you know, fastest time to value with an appliance like technology or you're trying to get the maximal capabilities out of our systems our engineered systems. we've actually built out our portfolio so that you can do all of that on prim or in the cloud or on your premise with a cloud service. We've made sure that whether it's database workloads, application workloads, or analytics workloads, that we have a complete portfolio of solutions that give you that choice. And that's quite different than anything I see in the market. >> Karen, thanks so much for spending time with On the Ground. Appreciate it. >> Thanks. >> I'm John Furrier. We are On the Ground here at Oracle's headquarters. Thanks for watching (techno music)

theCUBE presents an exclusive on the ground conversation with Oracle CEO Mark Hurd.  Mark sat down with John Fourier at Oracle's redwood city campus. >> Hello everyone welcome to a special presentation of theCUBE. I'm John Furrier   the founder of SiliconANGLE and we're here with Mark Hurd the Co-CEO for a one-on-one exclusive conversation , Mark welcome to theCUBE on the ground welcome.    >> Thanks John >> OpenWorld we were there with theCUBE >> So at Oracle and we were on Howard Street , we talked to 48 folks from Oracle executives and we learned a lot and we've been there covering it for six years and one of the striking things was Oracle's cloud message wasn't really well received by the press in the sense of they consider you kind of not in the top two. It's Amazon , Amazon it's this, that & the other thing. You guys had been doing cloud for awhile and I want to explore that conversation with you about Oracle's cloud your business startup landscape competition but one of the things that struck me was your interview on CNBC with John Ford he said are you determined to be in the cloud and you kind of had a shock back response and said determined we're in the cloud we're winning and quoted some stats give us the update you guys are in the cloud we watched that we learned that it's end to end what's the current status of Oracle's cloud play right now.    >> Thanks John,  well I think the way I would describe it numerically is not only in the cloud were a multi-billion dollar player in the cloud and so we started really several years ago in the application part of the cloud or SAS we've had tremendous success across the pillars of our SAS products or the pillars of applications in the industry we've added a platform capability or paths to that portfolio and now we've added infrastructure as a service so we're actually the only player in the cloud now today in infrastructure in pass and platform and in application so a complete portfolio differentiated by its by its scope and also differentiated by each of the pieces we believe to be Best of Breed and it's resulted in bookings I think that's out in the marketplace but I'll reiterated today. We'll book more business in the cloud  than this year than anybody else in the industry.  >> One of the things about the cloud that people love is the fact that it's fast it's got great economics but it has a scale component that customers are attracted too,  yet a lot of the folks who provide cloud technologies have different approaches.  Larry Ellison was on stage at Oracle OpenWorld saying he's long in the cloud game and you've reiterated that. What does that mean you know and the business folks out there they love this but they don't want to have different technologies that become outdated they want to have just solutions so every vendor's got different approaches why is Oracle well-positioned for this long win or the long players Larry's and you talked about.  >> Well first John we've been in this business a long time and so the fact is I think nobody's provided solutions at the depth and breadth that Oracle has over the past 20-some years so we've got a lot of experience in this business and that experience really as at the enterprise level so experience is is deep. That said to your point most of our customers spend a lot of money on IT and most of them have to go do this themselves. One of the promises of cloud is all of the things you said plus the fact it's it's simpler it's easier and you're actually not you're actually moving your innovation from your IT budget to Oracle's R&D budget and that's very attractive not just economically, it is ,attractive economically to your point but it's very attractive now to get in an area like HR. We have almost 2,000 programmers coming to work every day feature stringing that application would you rather be doing that on your IT staff or have that done by 2,000 people coming every work today who's on our payroll not yours to drive your innovation. >> global. Cloud is a global phenomenon  >>  The other impact is Obviously the geographic regions is hear now that as a key table stakes but you know it also brings in some economics on the economy side. What's your take on the global economy outlook right now in the world right now and and how does that affect customers decisions and buying patterns you know right now >> If you look over and when you say right now I'll look at it over the past couple of years. Revenue growth across the global economy the S&P 500 is fairly flat so you've had about one percent revenue growth of the S&P 500 over the past five years or so. Earnings growth though is about 5% and you've seen that reflected a bit to a degree in the stock market and the run-up of the stock market over the past several years so with revenue flat and earnings up that tells you that people are cutting expenses people are being very careful what they spend in what they invest and that gets reflected in IT and you see this in the IT industry and some of the results of the companies in it so companies are very much being very careful what they spend. I think companies overall are comfortable with their cost structures. They wish they could grow faster and it becomes the reason why cloud not just as a technology but as a business approach in a business model is extremely attractive to our customers into the broader market >> So they were there see expenses they don't only have to spend aggressively but they need to perform as well so it's also top-line >> John, it's a bigger problem than that it's a bigger problem than that because I'm worried about cost but at the same time many of our customers face competition. They face competition from startups new entrants into their industries and so they have to be innovative so it can't be just cut cost for cutting costs sake because if they do they can easily get disintermediated from their customer from their market and therefore they wind up not being competitive so the attractiveness back to the point about innovation and cloud is yes it's it's lower cost it's better economically yes it's simpler but it also drives more innovation at the same time and it's really the combination of all these factors that do the trick >> I put a question on my Twitter feed and Facebook I was interviewing you and I got a question I want to read to you as it says 'Marks on the road constant of customers then coming back to the ranch to meet Larry and Safra and the teams,  what is he hearing what is the consistent need from his customers and CEOs he's talking to who position themselves'  what's the common thread what's the holy grail for the customer that you're hearing from from consistently in the pattern that you're seeing your customer visits?  >> Help us get from here to there and and I think when you know you're in our industry you get a lot of people talking about cloud you know let's go to the cloud well if you're if you're not in the tech industry and you hear that you're like what does that mean and and then more importantly how do I get there so it's easy for us to talk about you know where we are. Most of our customers are stuck in where they are today and most of that is an on-premise many of those are older applications their homegrown applications so the process of not just telling us telling them where they could go but how do I help you get there.  At Oracle again we feel uniquely positioned and we're not just big in the cloud multibillion-dollar cloud player but we have a heritage on-premise and I see that as a very very strong asset and the ability now to bring those two worlds together and help our customers operate some of their IT on-premise, some of their IT in the cloud and be able to work those move those workloads back and forth seamlessly. >> you know you understand the athletes world >>  Timing is everything you  play tennis, being at the right spot the right time is really the business focus with customers and so when they hear cloud or hey this is a new technology from Silicon Valley think how well is that real so this isn't not so much as scared of the Silicon Valley innovation you're seeing you know for Tesla innovating things like GM and Ford but a lot of mainstream businesses want to have an answer to their problems not so much the shiny new technology. How do you balance the timing of delivering new cloud technologies with that next big thing in R&D or what not I mean what's the secret and what do customers look for is the timing issue of having the right solution at the right time what's your philosophy on that what's your take on that >> Well of course you're right I mean the fact is you know as we sit here in the Silicon Valley we tend to invent words every couple of years they're gonna solve all of the customers problems cloud big data whatever it may be whatever your problem is we're gonna we have a solution for it and the reality is most customers want to solve their business problem they're concerned about growing their revenue they're just they're concerned about becoming more efficient with their processes and so therefore we have to help them get that done so to your point we have to come in with real solutions, our solutions are baked around things as simple as running your HR system. You know running running your core accounting your core ERP and your core sales organization and being able to be able to automate those applications. I think you'll see  a tremendous workload coming around dev test. You know 30% of all of IT for example today is really done in developing and testing applications, it's all done on premise, it's all done with very little governance around it,  that whole process. Think of that, if Enterprise IT is a billion dollars,  Dev-Test at 30% is let's see I think 300 million dollars. How efficient do you think that spend is? Let's pretend it was 50 percent efficient,  which I believe is very high. A hundred and fifty billion dollars of opportunity for our customers to no longer have data centers,  computers, operating systems, databases,  people and be able to move all that to the cloud be able to access all of that capability from the cloud build and test their applications directly from the cloud and if they even want they can move those workloads to their on-premise production for their on premise production applications. So these are tremendous opportunities to change the way we think of IT and your point the timing has to be right there has to be an openness and an excitement about embracing these opportunities and I think that time is now. >> on that because it can be scariest shit >> What are you hearing from customers into the cloud and and and they might hey Oracle you know all you know you have your stuff and I hear the shiny new toy in Silicon Valley new technologies but what's in it for me that's the customer I've but I think mentality what's in it for me my problems as you said what it what is that issue for that for customers for your standpoint how do you how do they get over that fear to take that leap will the parachute open when they go to the cloud that that's the kind of mindset the customer I hear and I thought to what >>   >> various different people that have >> Well I mean they're different opinions I think many of those initial perceptions are beginning to change so I think you're getting more customers more openness and we're sitting here in the United States I think if you went back to to Europe and Western Europe there was always concerns about various issues security etc data sovereignty many of those issues I believe we're beginning to tackle and to resolve. But at the end of the day that the the real excitement is about the core things we started with,  this just costs less, this is simply driving more innovation,  and it's easier at the end of the day, and those are three fantastic benefits for customers.  >> So now there's a new class of buyers entering the market your customers and some of them are younger and you know we see some of them don't have voicemail setup, they don't really use email. Is Oracle's success generational and how are you guys bridging the gap or if no how are you bridging the gap to reach these new demographic of buyers who understand mobile and cloud have some that love that some are kind of you know as I mentioned earlier crossing the chasm on their own but this new generation of buyers what are you seeing >> there are you seeing a new demographic >> are you seeing a new class of buyers?  >> So it's a complex issue you bring up because the new generation in people sometimes generalize about these generations called Millennials,  etc.   They are both employees and customers and to a large degree they interrupt much of the status quo they work differently they also buy differently. Now at the same time remember that our customers have multiple generations of workers and multiple generations of customers so this actually gets quite quite interesting.  So if you take workers somebody my generation I like to might think of self myself as young and I'm in the technology etc but that the actual data says I'm not and I still work I still work in a workflow basis I use pieces of paper like you have today and and I look at those pieces of paper.   Not my kids. They work differently. They also work more collaboratively they work in groups but now I'm still in the company and so are a whole lot of Millennials that work at Oracle so we have to put processes and tools together that not only deal with what I do but what they do and make sure that we can all then work together that's a lot of work that's a lot of technology and it's actually made the business problem that we're talking about harder. Same thing from a customer perspective those same employees that work differently, they buy differently and you better be prepared to engage them where they want to be engaged,  how they want to be engaged, and that gives an opportunity for Oracle to help our customers innovate to give them better applications, better tools to go >> meet those customers and employees. >> Brings up a great point I mean it gets getting more complex on the business logic and business model and also the consumption and technology but isn't IT supposed to get easier?  I mean it once was easy compared to what it seems to be now what's your take on that it's got to get simpler what's your strategy. >> part of the issue is the data set >>   First of all the part of the continues to grow so the data set continues to grow and that drives tremendous desire for more information this while in some degree more data creates complexity it also creates tremendous amount of insight. The things we can do today we would never have thought of 10 years ago I mean there are things think about, can you imagine the  world 15 years ago where we couldn't search for anything.   We didn't have,  think of all the tools we have today that we use every day that we didn't have think about it this way applications the average age of an application in this country is about 21 22 years old meaning they were built in 1993 1994 1995 pre-search pre-mobile pre- social pre everything,  that  we're used too, so as a result you have this really old infrastructure trying to support this this new world and that's part of the promise I think of these new applications. They're engineered with mobile integrated into the applications themselves,  they're integrated with collaboration tools from the ground up,  and this world will get continue to get easier.  >> One of the questions we're asking our on our wikibon analyst team to our surveys and our customers is which vendor will provide the value fastest for getting the most out of the data. This seems to be a question that's kind of buried a little bit in some of the conversations out in the marketplace but it seems to be consistent. The value of the data is seems to be really really important. Who's gonna build the tooling and the automation and the integration capabilities to maximize the data whether it comes from some integration on an iPhone or collaborative document or an ERP system it could cover them anywhere and or mixing and matching data that seems to be the focus what's your thoughts on that and getting the most out of the data and what is Oracle doing >> with that in that regard? >> Yeah well listen historically in our industry you basically had applications that produced data, you then taken that data extracted it from the transaction application and warehoused it or  marted or used whatever term you wanted to use, and then create a bunch of analytics through some very very experienced scientific users who then would distribute reports out to the rest of the company that's the history of sort of data analytics. I did that for a good part of the earlier part of my career and I would say things are changing now that those analytics have to have to move right next to the application itself, they have to become real-time,  they have to be integrated into the core applications.  So we see happening today in Oracle applications is no longer do you have to take data out of the application you have to integrate it directly into the application so you can now get real-time insights. The ability now to integrate structured data and unstructured data and do it in near real-time so that you can now make a decision on something based on early indicators and then merge it and integrate it with the core way that you run a company and that's how you'll see analytics evolve,  the ability to take massive amounts of unstructured data but it's not gonna be good enough just to analyze that unstructured data that's social data,  you're gonna have to be able to merge that data where the system that can now do something with it.  >> And customers telling you that there and you're hearing that from customers as well? >> to, I want data that allows me to make >> Listen the fundamentals come back the right decision at the right time with the right customer the right employee to optimize my business. How do I get through all of this massive amount of data that you've been talking about so that I can make the optimal decision at the right time to benefit my business. That's the key.   >> the trends in the industry that you're >> Let's talk about trends, competing in the technology landscape has been very robust over the past few years and specifically past three years. What's your take on the landscape now I mean obviously the table stakes that the bar that the bar to get into the game that they're at entry what is the technology landscape like today from your perspective as a CEO co-ceo of Oracle with your competitors and your customers >> Well I think the shift is significant to your point I think this forget the overused term of cloud but that method of computing at the application layer the platform layer and the infrastructure layer is clearly where this industry is  Oheaded I made a presentation at OpenWorld that I felt by 2025, I predicted that 80% of that workload will be in the cloud. And I think I associated I made this statement then that I may be slow,  it may go faster and and that shift has a seismic impact on on our industry and it will happen and the reason it will happen is because of the reasons I've keep coming back to it when the customer can get better economics,  the customer can get more innovation, and they can get something done more simply, they're gonna they're gonna go do it . That's gonna cause losers and that's going to cause winners and that's why we've made the investments we have,  that's why we've built out all the data centers around the world that we have,  it's why Oracle has rewritten all of its applications from the ground up hundred percent >> all of our products now have basically >> 100 percent all of our been cloudified, they've been rewritten from the ground up to be cloud ready. And it's critical for us John because we believe this is and Larry started on this a decade ago so this isn't something we we thought about like 18 months ago and said hey why don't we go do this this this this came back a long time ago even before the term cloud was popular so it's this is this whole method and approach to computing which which which is key and frankly we started out getting into the SAS business the applications business and it was clear when you're in the applications business to really do that right you had to be in the platform business and then really to be in the platform business you had to be in the infrastructure business and that's why when you look at the barrier to entry John the ability to build out all three layers of the cloud the ability  R&D wise to do that or from a financial capital perspective to acquire all that good luck trying to do that then to build the infrastructure the data center infrastructure and the capital and remember John you have to do all this in advance think of it as to get into the cloud business from a IT perspective it's like building a hotel and you have to build a hotel before you can rent a room nobody can stay in the hotel til it's built think of that on a much bigger scale as being what it takes to get into the global cloud business >> So it's not winner-take-all it's winner take most or >> listen I was public in my view that I >> They'll be a couple of winners I think think that they'll be probably a couple of application providers I predict Oracle will be one I don't know right now today there is no other company in the industry who has got a complete suite of SAS applications Oracle's the only one somebody eventually will get will get that done I believe and I believe you'll have a couple of providers in that part of the industry I think probably likely at the platform level you have a couple of platforms that survive you'll also find the ability for those platforms to work together and I think like anything you'll see a couple of providers two three providers at the infrastructure layer >> Is Oracle a one big cloud or is it a company of many clouds I mean saw an  acquisitions this week, AddThis, and  I saw the word datacloud  sounds good great good marketing data cloud but it makes sense it's social data you see marketing cloud and social cloud you get in your are they a collection of clouds or does it matter is it labeling as the long tail distribution?  >> are clearly a set of capabilities in the >>  Well it's branding I mean they Oracle public cloud. Those capabilities are a marketing cloud a sales cloud they are not if you will architected as separate clouds they are built on as I said earlier they are architected on the same platform everything is built on Fusion Middleware common platform common base common infrastructure that can work together. >> You talked about in your prediction here that you know all data >>   You talked about in your prediction here that all  enterprise data we stored in the cloud faster and cheaper you also announced that pricing was or might have been earlier that cheaper than glacier and Amazon is that consistent the trend that you see pushing the price down lower and lower for the data storage.  >> think at the infrastructure layer we've >>   Yes I mean I looked at that world as more of a commoditized world that you know basically the infrastructure is a service there you're selling compute and you're selling storage and we think that market will continue to decline in in price and we expect to be very aggressive with our pricing in that market >> the cycle cycle styves kenzan flow as >> I want to get a take on startups we've seen in the 90s when I did my first startup it was really hard to get into the business you're the provision of data center buy router,  buy a Sun box at that time was very expensive it was also hard to get customers if you were starting up an enterprise customer in this case and then the world shifted easy to get customers with open source what seemed to be shifting back around where it's hard for startups to get enterprise customers because of the scale and integration challenges and the SLA is and the global requirements compliance and the list goes on and on do you agree with that statement or do you see it differently that it's gonna be harder and harder for startups it might be easy to start building stuff but they actually come in and compete and win enterprise customers what's your take of the the appetite of >> and John you're talking about tech startups  >> or tech startups that sell say you know how cells store take and I've just invented an all flash array and it's kick-ass and it's gonna you know eat into Oracle Exadata and EMC and all these those guys and I'm gonna go sell it to GM or I have a software product that I want to sell to company so again getting into the enterprises used to be hard and then it got easy it seems to be getting hard again what's your take of the state of that >> a long a subject that's got that's got >> So again quite a bit to it I think first I don't think companies are gonna buy all stick on the application layer for a second and talk about application startups I don't think customers are gonna buy from a hundred different companies for their cloud applications I I think when you're looking at applications specifically you think about automating a vertical process but companies also have to work together horizontally not just vertically so I think in the end they will they will have fewer cloud providers I mentioned sort of to could a company have three or a four a couple best to breeds maybe but they're not going to have they're not gonna make the on-premise complexity and just move that complexity to the cloud this is an opportunity to make things simpler to your to your earlier point I think that's what will happen now we happen to be we acquire quite a bit as I know you know and so we actually get to look at a lot of startups and I would say you're right that that we see with many startups is they start off trying to as inexpensively as possible which is I don't think I try to do it as expensively as I could try to try to build a capability and then many run into problems with eventually scaling and being eventually being able to build out we see this as we as we are I think for startups one of the real attractiveness of the cloud is that no longer any of those costs you described a few minutes ago exist I can now go do the remember that dev test I talked about that dev test I talked about for the big company is the same thing you could do on the cloud you can go get Java you can get the Oracle database you can only use or pay for what you use no longer you have to buy a Sun server that you describe or get a license and you can build on the most industrial strength commercial capability in the world Oracle and you can do that now as a start-up and be enterprise-grade from the first piece of code you write. >> So being a world-class leader might be harder for start to crack that nut versus becoming part of an ecosystem >> think that's right I think what you said >> I is right and I was trying to address both I think as a start-up you have an opportunity to to build on on commercial-grade tools from from the beginning and I do think you're right that being part of an ecosystem almost assuredly will be necessary as this market matures.  >> week at CES before GM announcing >>  A lot of commentary this Lyft could deal with Lyft and big investments try to be like Uber and Tesla electronic cars to in-car entertainment so I'm going to say that the car is one big gadget smartphone Internet of Things device which is true that big data problem that brings up the question GM and Ford or incumbent leaders in Detroit and the automotive industry are shifting radically this digital transformation is that something that you see similar in other verticals that >>  Well I'll stick with that vertical for a second I mean that vertical has shifted dramatically over the years I mean it used to be those companies made money selling cars they no longer made money selling cars years ago they then made money on service now they don't make much money on service now it's going to become the services that sit in the car with those are entertainment services or whatever they may be and so it's gonna be very interesting in that industry how they innovate do they outsource those services to another technology company in the Silicon Valley or do those become the core differentiators of those companies and and it's it's going that disintermediation occurs industry by industry by industry we've now talked about tech and what the implications are for the cloud on tech same things occurring in virtually every vertical.  >>  So you said early it's you know they're an enabler or it's gonna freak people out it's it >> Well this is what happens with innovation when time comes this is why we've done Oracle what we've done.  We've moved as quickly to the cloud as we possibly could.  It doesn't mean our on-premise business isn't strategic and important to us of course it is and I think the combination of the two capabilities gives us a huge differentiator. But that said for us to move quickly was critical we think to our long-term success and that's why we've been as fast moving as we can and I believe that true in every industry.  If you spend doing words like balance protect all of those sort of verbs they don't lend themselves to long-term success.  >> Let's talk about the company now that you're leading with the team. The number one question I get to ask I was told to ask you was ask them how the Co-CEO job is going and I'd like to know what it's like in the day in the life of Mark Hurd with Safra Catz, Larry Ellison take us through some color around what goes on behind the curtain >>  No.  I think well first of all we've been together awhile so so this is not like a new new phenomena so we we think we have sort of a capability that we can do a lot of things at the same time I don't know that that there is a broader team in terms of experiences I'm not trying to say we're great or try to be arrogant about it at all but it gives us the capability to touch a lot of things at the same time.  I've been a CEO multiple times and I can tell you it's a lonely job it's a hard job and it has a lot of responsibilities associated with it the fact that you can get a team that brings with it different skills different capabilities and you get the right personalities that that blend together that's that's a blessing and if you can get it take it . >> That's not just at the top tier of the management team also it's a >> company's pretty strong you know it's a >> I'm glad you brought that up John because I get questions like that a lot about Larry or Safra or they get questions about about all that but the reality is we're 140 thousand people in this company so we're a we're a large company with an enormous number of talented people I mean Thomas Kurian who runs our software development organization John Fowler runs our hardware development organization Dave Donatelli are people running regions we have we have a lot of very very skilled people come our Chief Architect Edward Screven I mean we just have a lot of depth at >> oracle and so it's a lot bigger than >> And the newly hired Dave Donatelli who is a shark when it comes to infrastructure he is strong and how's he working out I mean how's the that's a big >> listen and Dave is really leading the >> I think Dave's done great I mean product management go-to-market efforts around all of our all of our systems team which is going through its own transformation because we see the way infrastructure is now being used today and it's going through a lot of changing and Dave's just a great addition to Oracle >> He should me he knows it he knows the EMC playbook and certainly they have their challenges so I ought to ask you a question another one is that the hardware middleware market is about integration you mentioned that horizontal integration how how challenging is that for you guys and is this part of the transformation message that you guys have done internally because you're asking customers to transform and so can you give an example where you've transformed yourself >> Well when you talk about the middleware market I actually you mentioned the middleware market at least in some of the transformation I actually think with all of the data that we described earlier the opportunity to integrate that data and to integrate that data in the cloud is a huge opportunity for us we introduced an Oracle OpenWorld integration cloud services Oracle integration cloud services and the opportunity now for us to bring that to market and bring that capability to customers you know fantastic opportunity >> Let's talk about competition my favorite subject HP split up EMC sold to Dell , IBM is trying to make a run at it what does all this mean for the marketplace and specifically customers because you know those are big those are big companies that are transitioning or struggling as I'm saying what should what does all that mean connect the dots for the industry dynamics for those >> Well I think the industry our industry is no different than any other industry it's looking for revenue growth it's got leaders that that are are being driven to to grow revenue to grow or means to grow cashflow and in many times when you realize you you can't do that or they they find that they they're not in a position to do that they change and and change is inevitable and that's all you're seeing here is the change of what we described earlier you've got a certain market that behaved a certain way for a long time that market is now interrupted it's going to cause certain people to fail it's going to cause certain people to combine and as a result that change is going to occur and if you're not able to do the things I described the things that Oracle's done so if you will cross the chasm then change is coming and I don't think >> you've seen the end of it John. >> And a lot of these folks made big bets years ago going back a decade what bets do you see not paying off and what bets should people be making to be competitive in this new era >> believe what I said about our strategy I >> Well I think if you're not first in the cloud to begin with you're not gonna be long for this industry point one point two if you don't have enough breath in the cloud and you're just a single player with a point solution you're probably not long for this world so in the end companies want more from fewer people they want help with innovation they want better economics and that's going to prove in the end to come from a few companies in my opinion I think you'll see the same cycle that we've seen before that you'll see companies that frankly remember if you went back to the 80s think about how many great companies were in this industry in the 80s when I started in the industry I'm shame to have to admit that a shame but I hate to have to admit I'm old enough so I started yeah and therefore you look good well they're all gone yeah I mean Wang is gone the Digital's gone Data General is gone this Prime Computer is gone I mean this happens a lot and and this is just us going back to the future where we've got an interruption in the industry it's gonna cause winners and losers and it's the reason John that we've made the investments we've we have we could have easily done none of this invested none of this capital and harvested our existing business and it would look great for a while yeah not long run.    >> Yeah and you and you guys invested in the future at the right time seems it's working great for you guys the numbers are good how do you invest in R&D of some of the numbers in the cloud in terms of revenue book asking . l >> don't we don't give out you know all of >> Welll we our data forward-looking projections but what we did in our last quarter was we talked about our growth in the cloud virtually double our bookings year-over-year we've now got a chance to be in the ball well I won't give numbers out right now because I was already gonna make a forward projection but think of us now as multiple billions of dollars in revenue in  PAS platform and SAS growing and as our revenue has grown John our growth rate has actually gone up we say one more time the revenues grown and the growth rate has increased and so I think this comes down to the fact that we've just gotten better and better at this we've added more people from a salesperson perspective more of our products have become available in the market to the point of the percent of our portfolio that's now available in the cloud and we've now got lots of references and so it's an exciting time for us >> I've got to ask about Amazon Web Services obviously they've been going to have to work with our database and saying they can suck all that in and it'll come up in a second but I interviewed the former CTO of EMC who's now doing a storage startup on his own and he had a comment and I said well  Amazon's winning he says well we always debate what inning are we in in the industry and  Dave Vellante and I'm my cohost argued that he thinks were in the seventh inning I think we're in the first inning and so the guests said no you guys were both wrong,   Amazon won Game one of the doubleheader Game two is about the enterprise and it's not even started so I wanna get your thoughts Amazon certainly did well and doing well and numbers are pretty clear with public cloud now they're aggressively moving into the enterprise and it's just different ballgame talk about the dynamics their vis-a-vis Oracle you're targeting much more business approach understanding the IT side of the business Amazon is kind of do-it-yourself you know launching new stuff every day what's the distinction between the two some love Amazon people love the success you know good job Amazon people you know we cover them we like them they have a good product but it's not the end game to your message what's the difference in the two >> All right I'm gonna stay away from all the baseball analogies I think that they nstarted out as a retailer they had an IT infrastructure to support a retailer I think very clever they needed a lot of IT capacity when retail season was at its height during the holidays they said we've got a bunch of used capacity during other parts of the  un year we'll go rent it to people so they can leverage it makes sense now as you start to move into other workloads as you start working into enterprise workloads and dealing with all of the issues that come up there are more complexities to come up I think that we are in the I'll just say early stages and and by the way remember one thing I mentioned to you I think earlier just before we started and started this interview it doesn't take much of a change in it to have a dramatic effect on the revenue of the industry so I mentioned earlier about this dev test thing 30% of the industry three hundred billion dollars if only 5% of that moves its 15 billion dollars 15 billion goes from somewhere some companies that are supplying that today to somebody else and that's the very beginning of this see I actually don't think very little of this workload today has moved compared to what it will be five to six to seven years from that so - from that just a sheer numerical dimension we're in the very beginnings the very early phases of this the ability to get the bulk of this market is the ability to move massive amounts of workloads from some of the most complicated jobs >> so we're just scratching the surface of what it means >> just beginning >> ok so talk about the customers that you have because you have a lot of customers you guys have a zillion customers Oracle is a dominant player for many many generations of IT and computing we've seen that but I'm sure some of them have Amazon presence or they're kicking the tires doing some shadow IT through some things how are you guys do that because you kind of partner with Amazon on one hand but you also have cuffs cuz you have customers there how is how is that conversation going with Oracle and Amazon you say hey whatever or is there >> no I think that customers can chose to take their Oracle licenses and run them on Amazon they can also get those same capabilities directly out of the Oracle cloud we can take jobs between Amazon and Oracle and have them work together so it's it's really the customer's choice as to what's best for the customer my general view would be that if a customer is doing a platform job writing an application in Java I'll probably get infrastructure from the same person I'm getting Java from so I'm more likely to buy that infrastructure from Oracle if I'm buying that application from Oracle or using that platform from Oracle but if a customer says I'd really like to do my platform job on Oracle and store some of that up on Amazon that's customer's choice >> Okay Amazon is on the list of competitors Larry said one of the things is seeing new competitors he's SAP and IBM now new names yes Amazon, Microsoft Azure seems to be doing well we don't see vmware on that list yet but i mean as you're speaking in a little bit of some of the other players market share and cloud people have different cloud visions Amazon certainly has their in incumbent business Microsoft's what's your take on them visa vie Oracle which one Microsoft Microsoft Microsoft for that >> I'd say Microsoft done a good job I think Microsoft has moved its it's estate to the cloud not very dissimilar from from Oracle their applications is Microsoft the competitor of Oracle I think the answer to that would be sort of but but in many cases not directly their applications are really different from our applications my guess is many of the people using infrastructure from Microsoft are using infrastructure because they use their IP and their platform and/or their applications so I think therefore they they're doing the job that strategically that you see Oracle's multiple billion dollar cloud business doing as well which is moving many of its core capabilities from on Prem to to to the cloud they also have the capability now to merge and on Prem business and a cloud business which again I think it's a really key differentiator as we move forward >> differentiation seem to be dependent >> It seems to be the upon what people had or have going on either past or present so with that there's different approaches so I got to answer the question I'm a customer pretend I'm a customer hey Mark how do I evaluate all this stuff in the day is this like I need a matrix of like who's got one no wonder one's got checkboxes what criteria should I use to decide who >> I think John it comes back to the core stuff of you know who's got the best stuff you know whose stuff really in the end does does the best job for you starting at the application layer through through the platform layer through through the infrastructure layer and then the fact that you can now get this stuff in the cloud is a huge advantage for all the reasons we've been talking about for the past past several minutes but it's still gonna be about who's got the best IP but whoever's got the best IP in the end probably matters - I mean you know performance security I can go through a lot of other issues John but let's start with who's got the best IP I promise you promise you we will perform from a performance perspective I promise you we will have the best security now that said so a customer has done a license on Amazon Web Services are certainly probably doesn't run as good as an Oracle listen I mean obviously I believe the IP you have I believe that we're pretty good at running Oracle workloads I actually believe we're the best in the world at running Oracle workloads and and and and and I think you're gonna see that get yet even better as we >> I can attest theCUBE  interviews on the 48 interviews we did it was pretty clear that Oracle is very well optimized for Oracle on Oracle no doubt and clearly the performances order of magnitude significant >> and our cloud will also be capable of >> But John let me add handling non Oracle workloads so you know we think in the end while we'd love the whole world to run on Oracle we believe there'll be a portion of the world that doesn't and the fact that you can run those capabilities on the Oracle cloud along with your Oracle workload becomes critical as well >> Yeah I want to drill down on that because one of the things that I've observed over the past decade and past five years in particular there's been kind of a Oracle huge community because you have huge customer base but it's always been like you know redstack its proprietary and it's kind of like some whether it's truthful not that's been kind of a narrative but now it's with my sequel you got a lot of open technologies this Oracle OpenWorld it became very clear that integration it's not about redstack anymore referring to Oracle's you know their boxes and brand it's Oracle runs great on Oracle but if you don't have Oracle  you can still be an Oracle customer so talk about that dynamic this is a significant opportunity for Oracle news business >> You know maybe the narrative is the way you describe the narrative and you lowered your voice you know I got a certain impression and from the words you said now that said Oracle's always run hybrid workloads multiple applications around the Oracle database SAP runs in the Oracle database lots of applications run on the Oracle database so I think Oracle's always been if you will open from that perspective while continuing to build a complete stack now I'd make the argument that the cloud in many ways is of any cloud provider is a proprietary stack I mean insert name here is what is by the way that you know what the middleware is that Salesforce uses or the database or the middleware that Workday uses or day you can go down company by company and and at the end of the day you really though don't know what's behind that it is really totally provided to you by that provider and that is what you see being shifted in the cloud you can make the argument and this gets very into another interesting debate much of IT has been the do-it-yourself sort of approach I'm gonna if I will as an IT staff become an R&D organization and if you're a CEO and not a tech CEO but as CEO of a company with an IT organization you have to ask yourself is that really what I want to do do I really want to glue an operating system to a server build anything from scratch sure support it and do all this work and and or would I rather have somebody do it for me now as long as the economics are right and as long as I have trust in that in that in that partner and I'm secure and all the things we've talked about but at the end of the day transferring a lot of work that doesn't give me a lot of economic value add and moving that as I've mentioned earlier to Oracle's R&D budget I think becomes really attractive for a whole suite of >> I think it's great I'll rephrase the question so Oracle has a business as great business and you have customers they have Oracle software and contract value increases they renew they buy a new license new technology you grow your customer base but with cloud native what we with the web skills you pointed out a lot of companies were successful building their own stuff because they didn't have the cash but they had expertise so they would build their own caching and myself and they support it and pick up that cost but now as IT moves to cloud native that's a huge deal they don't want the build there also I agree with you you're looking at me >> I will say this and I don't mean to interupt you but there still is quite a debate in big companies and this is one of these transitions we've talked about the transition really from a tech industry perspective but inside the customer inside IT organizations the cloud is a threat so when you when you look at it as like the mainframe guys many computers were threatened exactly yeah so I'm now in an IT organization you know this do-it-yourself thing this is quite a bit of job security I wrote this application I've got to glue this to this and this is all really complicated and if you talk to a CEO and not get a non tech CEO and you say listen you really don't want to mess with all this because this is really complex and I'm the only one that really knows how to do this this whole thing work we're gonna transfer that complexity to somebody else has its own degree of threat to IT organizations so that debate you described that debate today John is still not over >> I think the Holy Grail whoever can provide a cloud native scalable turnkey infrastructure will probably of course you're right win that business of course right >> this is why these these these moves to your point about what in inor we in or what phase are we in these things have have multiple episodes so >>  are we in that cloud native phase right now are we for the for the new customer comes to Oracle hey you know what I'm I'm growing I've been doing stuff in the cloud with Amazon I've been doing this over here got my bootstrap data center I really want to go to cloud in a big way and we're growing leaps and bounds >> I'll stick with what I said we're in the very beginning of this and and we're in the beauty of this that the amount of IT John the suite of applications you go to any of these big banks in the United States around the world they have just sores of applications most of which were homegrown many of which sit on those mainframes you say we're threatened 25 or 30 years ago this whole move is a big set of moves that will take you know several years and you know use my discussion of 10 years out where I think I'll had it it'll take time like that to move now what customers are gonna want again one more time is I'm not going to be able to take that whole on-prem capability and just say thank you move it over here it's not gonna work so therefore the ability to move this thing job by job and then to be able to coexist these hybrid environments over a period of time become a become a key issue for our customers >> move at their own pace basically not >> so have them happy for examples and I think devtest is a as as >> I think customers I give you much work as has to get done to do that is is a sort of an intellectual layup I I think you're gonna see a lot of devtest move quickly I think you're gonna see applications particularly those applications that don't differentiate the enterprise customer facing application that you think is your unique sacred sauce you may keep that as homegrown on-prem but those commercial applications that don't differentiate me I mean me being the company I will move to the cloud as as quickly as I can >> Great excitement at Oracle OpenWorld this year the theme of integration and we talked to some customers and they were excited by that it's a big problem so that's that's one thing I'd like to talk about the second thing is what confidence can you share with the customers around new growth stretch I was the organic M&A and  organic growth versus M&A your a big buyer you're not afraid to go out and pay a premium for world-class IP but also you're doing IP internally tie those two together integrations the big themes continue to advance the product side as well as the growth strategy around organic growth and buying companies that might fit into >> Sure we spend a fair amount of R&D starting with your second question when I came I think we started spending 3.8 billion and in R&D we'll probably spend 5.2 billion this year in R&D so we we are we invest but not all of it is date we have a few hundred million dollars of our as well so we spent R&D and in in addition to the D the way I like to think about the innovation of Oracle is it's the D it's the art and it's what we acquire and so we have not built everything we've had very much a buy and build strategy we bought in some capabilities that we weren't building and we've merged those to create the portfolio that we have today and yeah we're not gonna stop that's continuing that's the cadence of Oracle right just continue yeah I won't put anything but I will so stop and I will say that we're very focused and and and not at all hesitant when we see something that we think is strategic to us to bring it in and add it to the portfolio you mentioned something early I want to drill down and horizontal integration and growth and vertical integration sometimes people think that mutually exclusive horizontal industry standard commodity hardware was a rage with open-source that helped grow a lot of the market and the web-scale days now vertical integration where hey it works it's kick-ass high-performance you are I don't really care what's in there it works Oracle support set is also working Oracle was kind of people were kind of poopoo in this whole appliance thing go back up you know five years ago good call working so by the way that is the same strategy that's called the class hey so when you really look at vertical integration the cloud is the ultimate in vertical integration because somebody's done now all the work for you when you buy a I try to explain this to customers all the time that when when somebody buys an application in the cloud they have actually procured a hardware database middleware services a data center floor space security they've bought all of that at the same time and so this this shift to the cloud really is the ultimate testimony to to vertical integration and horizontal they're not mutually exclusive you don't see them that's why I mentioned earlier what I said about why I think there will not be a hundred cloud providers supplying to our customer because integration we just talked about it in the vertical sense we want an HR implication that's completely integrated or in the ERP application that's completely integrated but those applications have to work horizontally as well as vertically so I would actually like my ERP application to talk to my HR application it might be nice if my marketing service applications talk to my ERP applications so I really can't I don't want to spend a munch of money on my IT staff horizontally integrating a hundred clouds I'd like somebody to do that for me and that's why having you know Oracle having the suite that we have in terms of applications platform and infrastructure is so important and that's really the trick balancing both really making that happen it seems to be you've got to do both I mean I'm a firm believer that you really have to have that full suite of capability ok so David lanthum IKOS and she'd want to get a question and so I told him I'd read a question for him he says and this is around the on-prem thing your strategy to create seamless experience between on Prem off principle is obviously your customers can't get there overnight how far along on the completion bar are you and your customers to achieving that vision of integration of allogram and off Prem and off prep seamless experience between seamless experience between off Prem and on-premise solutions today you can have an Oracle job running in the cloud you can have an Oracle job running on-premise with Oracle Enterprise Manager you can manage both jobs seamlessly and move workloads back and forth between on Prem in the cloud and you can do that today if we talk a lot about you know mainframes minis going back and looking at history total cost of ownership is a word that's been used in the computer industry going back to technology is a great way to justify things so let's talk about total cost of ownership but also want to get your take on what does patchwork IT mean to you that notion of patchwork IT in context well you've got a lot of terms you'd like to use I I would stick strategically what I said earlier I I think of much of what happened over the last seven eight years as a lot of do-it-yourself work whether you want to call that whatever term you want to use it the whole view of it for example in this valley if you drove up and down one you would see a slew of companies who individually are trying to sell you an IT organization of a company a piece part be sort of like driving up and down and buying a muffler and then buying a bumper and buying all kinds of stuff and putting it together in your driveway this is really now a shift in the industry away from you know patching together all these systems that are extremely complex and moving to a simpler more fully integrated tested optimized environment and it completely increases the complexity of tossa cost of ownership you said increases the complexity decreases the complexity and decreases total cost of ownership even in the industry through many cycles of innovation does that mean I'm old here at the peak of your career thank you very much people are freaking out some people are winning and happy because they're on one side of the disruption era or the other what does this innovation cycle mean to you right now compare and share your color a personal opinion around what's going on right now in the industry compared to other ones and then and how big seismic differences are there or there is it a big shift little shift compare contrast this much I think it's so exciting I think the most exciting things have in our industry in a long time I think the fact is this industry isn't now in a position and evolving into a position where we can really help customers we can get them out of this very complex world that we the industry have created and and like many industries simplify the way our customers get access to a fabulous intellectual property and make it easier and I think this is an opportunity that if you're if you're in this game if you're not listen let's face it out of colleges we haven't there we haven't had the excitement in the tech industry in years the fact is now with a new game to play this is a tremendous change with tremendous set of winners and and you know frankly there's gonna be the losers involved at the same time that's what makes it exciting and cloud is the better mark security was huge an Oracle OpenWorld I gotta ask you this question this came from a source on our wiki bond team top killer tech announcement Oracle OpenWorld was was security but with the Isis Massacre and the France thing the encryption has become a bad word was debated about four years encryption was a top topic in in the conversation that was a key message at Oracle overall everything could be encrypted beyond on encryption all the time as Larry said you guys are talking about what is the state of security right now with encryption and Oracle does that change your security angle with the products or what's what's going on with security right now so we're talking very much now about enterprise applications and and you know I think there's the cloud of all you know we we talked about this little earlier about the perception that I'm now going to take my data that is is very safe in my data center and on prime which we could debate and I'm now gonna move it to a cloud and therefore I feel vulnerable I feel vulnerable that my data is now in the hands of some other entity and and for us I think one big advantage Oracle has is the fact that that we're very good at data we've managed data since the beginning of the company I mean our first customer was yeah well in the CIA was our first customer they remain a customer today and so security has always been at the core of Oracle's DNA now the one of the reasons we have an encrypted database is four years is because when you encrypt them it the performance of the database actually slows so it's been years of evolution years in terms of Exadata development in terms of all the memory that's now I won't go into all the details of the technology but now we can fully encrypt the database and get incredible performance so what you have no hidden performance no I'm not you ready in great job none none incredible performance and the same theme you have an encrypted database now let me tell you what that means that means that when when a customer's HR data is in our cloud our people that are moving around the customers data don't see the customers data they see frankly gibberish they have files the key to that encrypted data can sit with the customer so when that those files come back across the network the customer can decide when where to use the key to open to open that encrypted file so therefore when you're in the Oracle cloud and I listen I encourage everybody ask our competitors how they deal with this ask ask them what their options are how do they deal with that data is is somebody whose nature or provider are there are there people looking at the customers data as they move files around well we've decided that we think the most important thing we can do is secure that data so let's pretend and by the way I don't think this would ever happen but if somebody actually got access to those there's nothing to have access to it's all encrypted talk about the implications for cloud on a global basis data sovereignty is a huge issue with cloud yeah does this impact at all there's a help it does no it does and so that's it's the reason we've had to one of one of the reasons that we've put data centers in many locations as we have so we do have customers that by law have operate in Germany and in the UK and employee data can't be of a UK employee cannot be in Germany and vice versa well we have we now have the ability because of our data center capability in Germany and our data center in the UK to actually make that capability work and so this this issue of data sovereignty like security is a big issue and you're helping the data sovereignty problem with this Robert yes we've had to address it we've had to address it we've had to embrace it and we've had to help it and it's the same thing with security so now you can have a fully secure capable capability in you know 19 20 different countries to help deal with that with that with that data sovereignty and security issue Barker thanks taking the time here for the cube 101 conversation thank you very much thanks John appreciate it you're watching special one-on-one exclusive conversation with Mark Hurd CEO of Oracle here on the cube on the ground here at Oracle's headquarters you

continues coverage of vmworld live 2010 on the scene at the Moscone Center South with special guest Pat Cal singer from EMC the president former Intel 30-year veteran welcome back to the cube back with the bloggers will upgrade from our last gig VMworld rockin here in VMware so Pat back back at the cube we'll go and we know you're really busy so so you've been at EMC now for almost a year what's it like there and you just acquired greenplum you've been busy since we last met so tell us quick update what you're doing the one-year is coming up and you got green Flint under your belt what does all this mean for EMC and then we'll talk about the keynote okay so well you know overall I think things are going on schedule if you think about it that way you know we said and coming into it we had certain agendas we did product announcements last week that we'll talk to you know that I'll cover in my super session today we've said we're gonna be acquisitive right we did art early in the year we just a green plum VMware's continued their quiz in nature they announced two acquisitions this morning you're personally I said we were going to be a disruptive entity in the industry well I think service model right he laid out key strategic directions for things like security right and how that starts to implement through the V shield directions also this model of IT as a service for IT as well as for service providers the key partnerships there so you know a major delivery through the Redwood technology that they did and and then here following up with you know some of the substance - you know showing the clear tangible progress against the directions that Paul was describing very consistent with a lot of the things you've been talking about sort of in preview fashion for shocking yeah we taught that UNC Rose storage is sexy and that what that went over real well since then M&A has been off the charts sizzling hot storage now we're here and and what we're seeing is proof points and you've done some things with green plum talk about what it all means in terms of proof points what proof points do you see that absolutely established the reality of cloud and that this is a mandate going forward as a future architecture whether it's developers mobility and talk about those proof points yeah and I think you know let's be careful I don't want to be too what while I am gonna answer your question I don't want to get too far ahead of my skis in the sense that there's still a lot more cloud washing than there is cloud substance and you know if you go back to the theme right to us you know virtual you know virtual roads actual clouds are trying to say there is some substance to it but still there's a lot of visionary directions here no that's said right as part of the be plowed a partner program that Paul described today you know these customers these part are putting up real cloud offerings today and those are becoming very real things like vCloud director real tools to implement those in place real customers like the Levi's example there were they're implementing this and what they do yeah we had Tom Peck on down at sapphire our CIO Levi's great story there yeah and you know I met with customers like Telstra yesterday right who is absolutely implementing services and delivering them to enterprise clients so I think that we've clearly in the hype cycle where you know the height great it's often well in excess of the reality and I think that's been the case for the last two years and now we're seeing in that hype cycle that the reality is starting to build where our real customers real services real applications are being deployed against this cloud model and sort of the mantra that we've been laying and we're seeing increasing industry momentum saying yes indeed we all need to rationalize our products our services against that cloud strategy so you've seen a lot of inflection points in your day as have we where do you see this one rating based on in the context of what you just said the whole cloud computing inflection point is it bigger than all the previous ones in your opinion or still remains to be seen well any anybody making such a prediction right you should think twice about right you know the validity of their claim that says but I think there's two aspects to it that I think indicate that it could be bigger than anything before yeah the first one is just the industry is bigger right IT and as the economy has grown an IT has grown as an percent of the economy we're just big now and IT truly is just a huge sector of the economy particularly for United States right Silicon Valley area you know this is our agenda for the world so as the economy's bigger and secondly this is disruptive in multiple dimensions of the industry the changes the infrastructure it changes the application model it changes the service model it affects service providers that affect system integrators many of the prior changes were not as disruptive across all of the strata of the industry so because it's bigger because it is more in across all dimensions of the industry I believe and certainly you know as Joe has talked about Joe touchier CEO has said this is the biggest how big I don't know but as this one feels like you know this is sooo not Amica last wave if I was a surfer yeah Joe's famous wave slot we had Microsoft on yesterday who's actually here but they can't really show anything and we talked about them about their hypervisor I asked a specific question about as the PC era reached the Stu glass ceiling the bloated PC chained to the desk the PC centric view you've lived that generation it's not so much that it's irrelevant it's just that it's changing and and we're in a new era so what VMware is putting forth with this architecture and some of the things you've been working on you have a platform and you have agnostic devices that really changes the game on this PC centric I mean what do you see on them on the on the user centric side the key variables in the industry well I think you know number one any of these waves you know I predicted in 1990 the end of the mainframe varied 20 years later it still hasn't quite gone away right and that's that's it's not like these waves become the death of all prior you did some damage but it doesn't like immediately eliminate those prior technologies but the Nexus of innovation the foci of the industries new capabilities productivity applications is shifted and I think all of us today would say the PC right isn't that foci of innovation hey lots of apps are using it use it yeah hey I am much more productive on my laptop than animun iPad or iPhone or Android I mean you know I just you know just much more productive in that sense but you know I can't carry my laptop around in my pocket right clearly we're seeing the shift of innovation new application models new consumer centric usage models both the devices and the applications and I think as Steve Harrods akino talked about very much hey I want an app store like thing for my enterprise applications right where you see much of that consumerization coming to corporate IT as well so it has shifted right applications usage models will be device independent right they will become more sumer focus and essentially let's just say they're gonna be more iPhone like greater than how we'd get them and consume that at at to Orlando we sat down and we chatted about at a great chat and at the Cuban Orlando I asked you a question about apps and infrastructure and I asked you specifically our apps leading the way and showing the infrastructure and you answered no infrastructure as always was a leading indicator to apps but apps seem to have more momentum what is the VMware announcement today how does that shape that that thesis that you mentioned I mean obviously it looks like more enablement at the software level what can you share with it cuz that's real as a great point and what I want to bring that out again yeah yeah and the point I made there was hey you know we know a simple structural hardware guys right we create capabilities and then the apps guys come in and use them inefficiently and poorly but to enable new things a sort of that you know that gap right of capability in the infrastructure that then gets filled in by application vendors and I still believe fundamentally that's the case you don't write apps for infrastructure that doesn't exist yet you can't run an applications business that way so our job is the infrastructure guys is always to create these new gaps these new vacuums for the app guys that come and fill in and I think everything we're seeing is very much that case where all of a sudden there's lots of performance that's easily readily available you know think about how easy it is to deploy a VM today right literally you know if I would have had to go provision things buy some new servers get the port's alakay to get a network reroute you'll build up a new storage infrastructure it might be months for me to allow a major new application to occur literally now a few clicks we what do you see in the VMware announcement today given what you guys are doing in at the app level as the core enabler the disruptive enabler that's gonna really tip that over in terms of the innovation yeah they're anything new there well I think there are two aspects to it you know if you take the redwood the vCloud director and I think it really is this idea being able to rapidly with essentially no cost be able to create new virtual data center infrastructure be able to do it with the security model with policy based capabilities with the provisioning environment in the manager let's go with that is way profound right the second thing is all of all the things about spring right is not just being able to do infrastructure more rapidly it's not just encapsulating existing applications it's also enabling a new developer model for tomorrow's applications as well and that is truly right thrilling to anybody who's doing enterprise application development some of the CIOs we had on we're saying that they actually benched themselves against the cloud service providers do you see those two worlds the cloud service providers and big IT coming together or do you see the cloud service providers always having an edge over a big IT well I think there's an aspect to that that you it's not our job is to make the infrastructure as efficient on both sides of that equation as possible so that an IT guy isn't making the decision based on cost he's making the decision based on business relevant factors you know this is something hey you know I need to guarantee compliance in this application this is a business critical infrastructure element for me I'm gonna run into my infrastructure but I know the cost of doing so is still highly efficient I might Feder a tit with an external service right I might do tests and dev externally and when that's done I might bring it internally I might use Federation of outside compute capacity so that I don't need to build for peak I build for average and I spill over to rent VMs at quarter close or month close I might say boy I want to actually be able to take advantage and federated some of my key customers or channel partners or business partners I'm gonna have and I'd actually be able to them to be able to view me as their service provider right so hey just operate and utilize my applications right as one of my business partners as well and that's really the power of the vision that we're laying out it's not public versus private it's public and private and allow them to be federated together into hybrid services that give you the best of both worlds in a seamless agile manner Pat the M&A activities been hot you did a greenplum acquisition DMC bought cream plum which is a nice acquisition and rate act was very nice come on this is a game-changing acquisition by EMC to the cube we treat our guests nicely so it's hot so the horses are on the track I tweeted that and said hey everyone's out in the track right now the big guys Oracle EMC net AB so talk about what's happening why is the M&A activity so hot is it an indicated the fact that people have to retool faster is it an activity that they're behind is an activity that they need to move faster all of the above what is your view on that and you know what's next in M&A well I think it's a couple of different factors are at work and one is if you show up at my super session later today you know one of my slides is the three views of the cloud right the uber cloud model the Google's Amazon's I'll call it the vertical cloud model HP IBM and then I'll call it the virtual cloud model even seen anywhere right you know and of course you're right we contrast those three and what we're seeing I would say is those business models those industry structures those strategic frameworks are driving the consolidation of all of the medium and small players into one of those pictures so I think you can look at that lens and say everybody is taking M&A acquisitions to better implement and solidify their view of that strategy of these three different views of the cloud so right one is its industry structure that's going on second is you know after the downturn everybody's coming out of it cash rich right you know yeah yo people got money to spend there's a good time to do it right you know in that sense and you know so right there is a clear right earnestness to people saying okay right I can pay dividends I could buy back shares boy that's pretty innovative strategy isn't it right or let's go start you know taking more aggressive steps I think it also indicates that there are only so many exciting assets available right you know good assets that people could take actions on so you know and any buyer and seller market right prices get crazy when there's more buyers than there are three party people who followed your career know that you had Intel you were very Pro ecosystem and we just had some VCS on yesterday top DC's and cloud talking about how hot it is and they're looking for startups not the angel stuff but like real money real real technology talk about the ecosystem that's emerging in the startup community because so there are guys developing new cool stuff that very cloud centric that's yeah new so talk about your view there what you see and what your general opinion is well I think like any these waves there isn't just the wave of what goes on in terms of what the big guys do right there's new university research that's going on as some of that's exciting there's also than the adventure community great and with this wave you know it is so disruptive it changes consumer computing new consumer devices new consumer applications new enterprise infrastructure new enterprise applications and you know all of a sudden we're seeing a new round of dramatic VC activity again and they're not going into you know startups that are building a six and semiconductor sort of I grew up sort of saying let's go build new infrastructure components new applications that live on this new model and virtualization yeah absolutely it's all riding this cloud virtualization trend and you got just a stunning you know 17,000 people at VMworld I have one final question I know you I know you want to get a final question actually let me get my final question first in a new close I'll give you less word so you've been spend a lot of time in New England lately do you like it there you're gonna get a movie stir well we cry you out of here we've taken a second home Oh faster half time and my wife is actually loving this bicoastal a couple weeks a couple weeks there back and forth excellent ball season starting absolutely maybe the Red Sox so we had some readers point out on the blog that the Pat gal singer has the same exact track that Joe Tucci had CEO president CEO anything you want a nice they want you I want to say anything do I have no announcement that's great thanks so much I know you're super busy and coming on the show always thank you guys thanks thanks we right back