(upbeat music) >> Live, from New York City, it's theCUBE! Covering Lenovo Transform 2.0, brought to you by Lenovo! >> Welcome back to theCUBE's live coverage of Lenovo Transform. I'm your host, Rebecca Knight, along with my co-host, Stu Miniman. We've got two guests on the show right now, we've got Naj Husain, the CEO of Cloudistics, and we're welcoming back Rod Lappin, who is the Senior Vice President of Sales and Marketing here at Lenovo. Thanks so much for coming on the show. >> Thank you very much. >> Great to be here. Nice to meet you. >> So... >> Rod, why are you so lazy at this show? MCing the show, on theCUBE twice... (laughter) >> I know, it's been an exciting day, hasn't it? I've actually done a few meetings between I saw you last time as well so, I'm living on 2 and a half hours of sleep last night, and I'm running hot so I'm looking forward to a drink at the end of the night. >> Yeah, a well-deserved drink. >> Sleep fast, sleep fast. >> Exactly. So I want to start with you Naj. >> Yeah. >> Tell our viewers a little bit about Cloudistics, it's based in western Virginia, what do you do? >> Yeah, so we build a private cloud with a premium experience. We founded the company in 2013 on the idea of simplifying infrastructures. In our previous world, we actually lived the problem. So in our previous company, we actually took Amazon as an analog, and tried to move our resources at Amazon and simplify it. Because we were tired of managing complex infrastructure. So as a company of 500 people and a software development company, we wanted to simplify our world. So we went to Amazon, we spent 3 months or so developing codes of implement QA. Great, real simple. Don't have to worry about hardware at all. It's a great value proposition. All of a sudden we started to implement this thing, after month one it was 100,000 bucks. After month two, it was 150,000 a month. After month three, we're creating the 200,000 a month in fees to run Amazon, right. While the value proposition's all about "simplicity is awesome." The problem is, it's very very expensive. So as the company of 500 like I said, we had to figure out what to do next. So I spoke to my CTO and I said, how can we solve this problem? So he said, okay I can bring the infrastructure back on prep, great. So he priced that out, it cost less than one month of opex in Amazon. So we did, and then we had a problem where okay, now we need software to run on it, to make it work. We needed a virtualization platform. So we looked up what was out there, and the cost for it at the time in 2012, 2011, it was a million dollars in commercialization software. I said we can't do this, right? We're too small, we don't have the funds to do that. So we decided at that point, we're going to found the company to solve that problem, and democretize IT to give companies of any size the ability to implement cloud computing behind the firewall, at an affordable price. >> And you call it "Composable Cloud". >> We do. So when we looked at the market at that point, there was different types of technologies out there, and there was things called hyper-converged and traditional converged infrastructure. And what we did, is we took a page out of how the public cloud operated. And the way the public cloud operates is they have composable resources so you can scale resources independently. So I can scale networks separate from computes, separate from storage. And that's a big deal when you're running a cloud because you have to worry about economics. So when we architected the product, we started there. So we started with this scale-able architecture that's composable, so company's grow as they need to grow. They don't have to tie resources together, right, so there's no resource drift, we call it. It's independent scaling. And that's one of the big differentiators in our platform. >> So Rod, why don't you help bring in some of your customer views that you hear on this. I'm sorry but I smirk a little bit when I hear, "We're going to simplify things." (laughter) In my career, I've talked to lots of companies, and everybody, we always have the goal to be simple. >> Yes. >> "But, oh wait I need to change this a little bit, I need this other thing, oh wait I've got this Lenovo product, but oh, you've got this other product that's good, how do I manage all of these?" And Cloud was supposed to be, you know, just an easy button and low-cost and everything, and it's helped but it's also added new silos, and new things that I now have to get my arms around. So maybe set up for why you-- >> Yeah, sure. Well I think to Naj's point firstly, I think the Cloudistics solution is really unique. And it's very compelling, actually. It's a very compelling offering. Firstly because I know one management said that you could basically run storage, compute, as well as networking, sitting over the top of a hypervisor, on prem, his point? So to Naj's point, you had like 50% of the cost of a normal cloud infrastructure that would be going out into the market pool, and still have the management suite sitting up in the cloud that they obviously manage for you. That's very cool. But one of the other things that's very cool about the Cloudistics offering is you can scale up and scale out, depending on customers' requirement. So once you've got yourself in this composable cloud model, right? And you're actually running with Cloudistics, instead of saying okay, my business is growing, now it's getting bigger, I have to pay this much for an extra amount of x, whatever it might be, if you want more compute, you can have more compute. If you want more storage, you can have more storage. You can actually add the components of the cloud that you require, based on the consumption that your business is actually running to. And that's one of the very very compelling events that Cloudistics' offering actually has. >> Composable and customizable. >> Yeah, and very simple. One of the key tenants of the platform is making this thing really really simple. So when we designed the product when we started, we started with the application first because at the end of the day, that's what you're trying to run. You're not here to manage infrastructure, you're here to develop being agile in your business. So we focused everything on making it really simple to deploy, and making the hardware invisible, automating all of the updates, so you never have to see hardware. And all you can focus on is delivering your services. >> So I want you to get really specific for a second. >> Yeah. >> Because many of the things that I hear, they think, oh, reminds me of what the companies that do hyper-convert say that they're doing. >> Right. >> Simplicity in the enterprise... >> Right. >> Easy to manage, things like that. >> Yes. >> Is there a software offering, is there hardware involved-- >> Correct. >> How does this all go together, is this a management suite that ties in to what I have? >> That's a great question. >> Make sure I understand. >> Yeah, so it's a completely integrated hardware-software platform, so think of it like your iPhone. When you buy an iPhone, it's hardware-software beautifully integrated... >> Motorola's the same by the way. (laughter) Yeah, okay, Motorola, fine. But it's a phone that's integrated with hardware-software. You connect to the network, you're up and running, you download your apps, and you're done. It's a beautiful experience. So we took that as an analog for our platform. So literally, it's completely plug-in play cloud, you roll it in, plug it into your network, go to our Marketplace, log in, download apps and start running. You can run Containers, you can run Docker, you can run Windows Sequel, all those apps are available for you to run with a click. So businesses now can be much more agile, right? Because now they're worried about delivering services, not messing with multi-solid hardware. Right so now generalists now can manage this platform. DevOps can manage this platform. Just like the public cloud. Yep. >> So to make this setup really simple, what we're doing is we're taking the thick agile solution, which is that pre-configured, pre-set, rackable solution. So compute, storage and networking all in one solution. At factory, we're setting it up with all the Cloudistics structure that we need to send it out, and basically ship it on site for customers. They only need two plugs, right? A plug for the network, and a plug for power and basically it's ready to go. >> It's amazing. >> Rod can you help, so we were just talking about the big news with NetApp. >> Right. >> You know, you've got new relationships with tenants, how does this fit in the work folio? What are the customer kind of pain points as to when Lenovo would lead with this? >> I think that's a fair question, Stu. I think if you have a look at what our go-to-market strategy is in the hyper-conversion space. This is largely guided by customer demand. So, basically at a customer demands point, we'll go in and we'll obviously lead with our customers and understand what are the pain points they actually have in their environment. Because many customers have got different environments, and three years ago, everyone was like "I'm going to be an AWS jumper, or I'm going to be..." The reality is everyone's got so many different clouds in their environment, they've got so many different environments set up. You know, whether that's the Adobe Cloud and Marketing, or AWS, whatever it might be, you've got to manage all of these different environments. So it sort of is dependent purely on what the customers' environment is, where we actually go. Now, from our perspective, this is a brand new relationship, only 6 months old, we are setting up dedicated people specifically to sell this with Cloudistics, and I feel like it's got a really good future. We just got to get this business growing, and I think we're going to be talking to more customers about it. >> Yep. >> So who is your sweet spot? You said that the emphasis of starting this company was that companies of any size could be able to do these things, and act more agile, as you said. >> Right. >> So who is your sweet spot, what's your target? >> Yeah so we target a medium-sized enterprise. So you know, 500 employees to 5,000, kind of in that range is our initial target. And we drive the applications like Window Sequels applications, applications that rely on performance potentially, or even general purpose work clouds where they just want to simplify management of the stack. And as Rod was saying, the management of the platform's pretty unique, and the fact that that's in the cloud, the management of the platform is in the cloud. So it makes it very simple to manage. So from one central spot, I can manage my multiple stacks throughout my company, and it makes it very easy to employ applications and manage everything. >> Do you have any specific examples of sort of the pain points that you helped solve? >> Yeah, so in our case, it was really around driving simplicity. So in many companies, many medium-sized companies, they struggle with the complexity of multi-tiered infrastructure. So I have to have a virtualization expert, I have to have storage expert, I have to have a network expert. And I have to have an app expert as well. Right, I've got to make all those people work together. So businesses now are trying to be more agile to push applications out the door so they can run their business. So by all those interdependencies, it creates a lot of complexity. So we've cut out all of that and we've created a platform where you don't need all of those interdependencies. It's done for you. So it's literally plug and play, so businesses can get right to their work at deploying applications. >> So, there are a number of things that we've looked at, from a research standpoint of what makes a private cloud, and a lot of it is kind of measuring the bar against a public cloud. You said, simplicity, absolutely a good one. One of the ones that we're starting to see some movement in the private cloud, it's starting to go more opex. >> Right. >> As a service office. >> Correct. >> I was walking through the show before and talking to Lenovo people about that. Is that part of the discussion today, and maybe talk about how that works. >> It is, and the platform is fully tenanted for example. We took a page out of the public cloud where, if you go into any public cloud, you create yourself a virtual data center. And within that virtual data center, you can deploy your applications. With our platform you can do the same. You can have a pool of resources, we've extracted everything to pool. RAM, cores, and stores, that's all you need. You can allocate those to your constituents, your customers, your departments. And they have a completely multi-tenanted, fully secure environment to work under. Without impacting anybody else. And with our core technology around networking, we've completely isolated the layer 3 networking layer, to make sure it's highly secure within that box. >> I understand. So they can almost be like a service provider themselves? >> Yes. >> So I guess one of the things is, what about from the financial standpoint? Are things still allowing me to scale up and scale down, is it just in that box I can carve it up? You know Lenovo has an option that was like oh hey, I need to burst up for a certain season, but I'm not going to have to pay, or are there certain things they can do financially. >> Very, very interesting. So the platform is elastic in a sense, where you can plug in and play resources. You can add memory, you can add cores, you can add storage, you can network on demand. And jack it in and scale the resources. We are working on coming out in a future period a hybrid where you can burst and scale into public clouds, which is a big deal, right? Because we have very unique layer 3 networking technology, we can potentially stretch those networks into some other cloud, which is very interesting. So that means that our Lenovo customers can then burst into on demand, on the monthly payroll system, into a public cloud if necessary. So that's a future thing we're working on. >> To your points as a service, you heard today obviously as we had a little bit of a keynote up there, Kirk hinted at the fact that we're trying to drive as a service solution around on the hardware, which really matches perfectly with the Cloudistics solution that Naj was just talking about. >> Yes. >> We're really, really close to this. I would have loved to have been one of our announcers today. But we've got a few other things going on. So we will come forward in the market as a service, fully metering as a service solution that we think is very compelling in market to match up with the Cloudistics offering very, very shortly actually. >> It's fun. >> So how are you getting the word out? I mean we already know you need to increase your budget, that was our last guest who said that. (laughter) >> Exactly, so Naj and I went on our focal about this decision this week. >> Yes. >> We need to get the word out a lot more aggressively, and a lot more compelling than we are today. So we have dedicated resources now in Western Europe and North America, we're about to expand our dedicated resources into China and the Asian Pacific, and then down into Latin America. So we start off by dedicating people on the street that are actually going to be at the start talking to customers. Then we're going to have to drive into a marketing campaign of some description, so we can actually start to drive a more compelling story to market, so they actually get to know what Naj's company has developed. Because once again, it's really compelling. >> Right, great. Well Naj, Rod, thanks so much for coming on the show, it was great having you. >> Thank you. >> Thanks very much. >> I'm Rebecca Knight with Stu Miniman, we will have more from Lenovo Transform and theCUBE's live coverage in just a little bit. (upbeat music)

>> Live from New York City, It's theCUBE! Covering Levnovo Transform 2.0. Brought to you by Lenovo. (techno music) >> Welcome back to theCUBE's live coverage of Lenovo Transform here in New York City. I'm your host Rebecca Knight along with my co-host Stu Miniman. We're joined by Rod Lappin. He is the senior vice president in marketing here at Lenovo. And Roger Cox, the research vice president at Gartner. Thank you much, gentlemen for coming on theCUBE. >> Thanks for having us! Excited. >> So the big news for the day, NetApp, Lenvovo Two global powerhouses joining forces I want to hear Rod, the Lenovo speil, and then I want to hear your analysis of the deal and what you make of it. So why don't you go ahead. >> Yes, so obviously we're really really excited, Rebecca. It's a great day for us. I think it's something that we've been really planning with NetApp for obviously a long time, and to actually have it come to fruition is really exciting for all of us, right. So as you would have known, probably, our storage offering in market has been quite small up until now. We're addressing about 15% of the market. With this new deal with NetApp we're sort of in the TAM the target market. We can after up to about 92%. We've been quite good at storage. We've been growing about 2X the market average in Flash, over 100% year on year, but we haven't really had the full product range that we've needed to really address out customers' needs, and so, now having this, having this deal now with NetApp means we can go after our customers and really bring value to them the way that we have wanted and definitely the way our customers are asking us to. >> And so that's my question. Was it customer driven? Was it them saying: We just need you to able to do more or what? >> I think if you look at our core business last quarter, Gartner, obviously, ranked us as the fastest growing server business globally. We grew 68% year on year on our revenue last quarter. And so, with the momentum we've got now as a business, we're seeing our customers want us to do more. We're number one in customer satisfaction, number one in reliability, so they see value in us generally but we had sort of what I would classify as a subsegment of the storage market that we want to address. And of course our customers are saying to us: Hey, we want you to do more for us because we like the way you've performed. So it's been good for us. We're excited >> Yeah. >> So, Rodger you know a thing or two about the storage industry and NetApp specifically. So give us the customer viewpoint. You talked to a lot of them. >> Well, first of all let's say this is one of the better kept secrets because it never leaked out. So really haven't been getting customer calls on this event yet but I'm sure we will starting today be getting a lot >> Yeah, they brought a few analysts down to RTP in July and I remember, Rodger you said: What do I do when the customers call? and they're like, shh, shh. Customers aren't going to call. We're going to keep it under wraps. >> And they did a good job of it. But anyways, what it means, I think, to Lenovo is it really elevates Lenovo's standing as a provider of IT technology for the data center. So they now have, not only a very competitive server offering, which Rod's talked about quite a bit, they have what many believe to be one of the best storage offerings in the business. And now they can go compete head to head against Dell EMC, as well as with HPE, which would be the two larger competitors that they have to deal with. So it's going to be very good in terms of providing an alternative to clients for data center technology-involved storage. Good thing. We like competition. >> Absolutely, and we want to be part of it. I think up until now we probably haven't been able to. So when you look at how we're going to market, my field sales team has been planning with the NetApp field's also. We've been basically coordinating how we go to market where do we attack together, where do we have conflict, where do we not. So we actually go in and really focus in on those core competitors that Roger's just described which is where we want to go. >> In the keynote this morning it said from a channel standpoint, there's not a lot of overlap which, on the one hand, I'm saying: Well, sounds like we'll need a lot of training then. But how do you hit the ground running fast? >> So we are already ready to go. We start shipping tomorrow, so that's the good thing about this announcement. Like Roger said, we kept it under wraps, but we are ready to manufacture and go. So, I think it's a really exciting spot for us. From a go-to-market perspective in the channel, NetApp has traditionally been very much about engaging end users, fulfilling through the channel, but engaging end users. Where Lenovo's got a much stronger forte around mid-market and SMB. And we've got a much stronger forte in emerging market, so if you actually start to split geographically the world up a little bit and then you can start to split how we got to market a little you can actually find some really big parts of the market that we don't conflict at all that we can go after. >> But you see, from my point of view, the bigger challenge they have is to go to market. Now they could say there's not much overlap, but you know there's always overlap. There's going to be certain accounts where Lenovo already has a position, and maybe NetApp has a position, too. Then, who's going to do what given a time? So, the biggest challenge that Lenovo has here is also a challenge for NetApp is how they manage together the go to market motion, as well as the service and support because Lenovo's going to have level one, level two support responsibility. They're going to have that revenue to go for support. We'll see how that works out over time. >> I want to ask you what your advice would be to Lenovo leadership in terms of, this deal enables it to go after bigger players and to take over more of the market. But when it's now going head to head with Dell EMC , what do you think it should focus on? >> I think it should focus more on marketing. The products speak for themselves. The competency of these products are well-known. Besides this, it gives Lenovo the opportunity to become more cloud-friendly, too. Because they also have access to all of the software out of NetApp's cloud data services organization. So my main advice would be to Rod, because he's responsible for this, (Rod and Rebecca laugh) is put more wood behind arrow. Get Huawei to put up more money to accentuates the marketing of the product. Create more enthusiasm about the fact that you're now up at another level in terms of being an IT provider to the data center. >> It's a well kept secret as you started out by saying >> Yeah! >> That's right so we've got a business case that we've put together that's starting today obviously. Which involves us getting out and starting to hit the ground running with a lot of media. There's a lot of social media noise today on it obviously. Thanks very much to people like yourselves which is great. And I think we're going to see a lot more marketing-based initiative that run both through the channel as well as to the end users across our, what I classify as our T-1 countries to start with. To Roger's point, though, when we look at the go-to-market, we basically categorize in all the accounts into four boxes. Those accounts where NetApp's very strong and Lenovo's very strong which means Lenovo's strong from the server perspective. NetApp's very strong from the storage perspective. >> FAP would be one of those. >> That's right. That's a very good example. And in that environment, we're going to collaborate and show them we're communicating with each other and ultimately, not fight with each other. We're going to recognize that we want to continue to protect our server business. They're protecting their storage business. We don't want to touch that. In a place where Lenovo, for example, may be weak and NetApp very strong, so they're got a very good storage relationship, we want them to bring our servers into that space. Because obviously if they don't bring us in, then one of our key competitors that is also competitive in NetApp is going to have a foot in the door there somewhere. So, we're going to drive a little bit of a different strategy in that environment. Then, we've got obviously the third environment where Lenovo's very strong from a server perspective and NetApp's nowhere. In that environment, it's free fields for Lenovo to go after that with our new storage array. And then obviously, where we're both neither engaging those customers, it's in acquisition for both. We're going to play and ultimately go after them. There's some really great things that we've been able to put together with this relationship. Like for example, comp neutrality. So, the NetApp teams when we go into that third and fourth box I was just talking about, the NetApp sales force is going to paid the same whether it goes on a Lenovo hardware or goes on the NetApp hardware. So, we've got some pieces that sort of ensure that we don't have conflicts and we're all aligned to ultimately grow and compete with Dell EMC and HPE. >> So, Roger There have been some interesting server and storage partnerships. I think back a decade ago, Dell and EMC did billions of dollars together. It eventually broke up, and then what do you know, it went back together. I think five years ago, NetApp had pretty strong server partnership there. The storage market has changed a lot in the five to ten years. Tell our audience a little bit how NetApp's different, how the storage market's different, and how customers should be thinking about an arrangement like this. >> Well, the storage market's different because there's more alternatives for storage. There's the Cloud: AWS, Azure, even Google Cloud. You get over to Asia, Alibaba over in Asia and so forth. So that's had a very large impact on on-premises storage. The other one is hyper converged. Lenovo's very much a hyper converged business. They have relationships with Nutanix. They've got them with VMware. They have them with Pivot3 and some others. And so, all of these things come together to create a different alternative to the classical three-tier infrastructure: server, networking, and storage. So, all those things are going to exist. And, the upright storage market, while it may be a declining market from a revenue perspective, has a long payoff. It's going to be like mainframe, so it'll be here forever. Like Tate, here forever. It's like me. I'll be here forever. (Rod and Rebecca laugh) So right now, Stu, we're seeing a little bit of a bubble. So we are getting a bubble interns of, this is a good time by the way for Lenovo to have this partnership because there is more likelihood of increase spending for IT. Good economy in the States, good economy over in Europe. Good economy around the world for that matter. I think it's going to last another couple years. 2018, 2019, maybe in the 20's before it starts tailing off again. So the way people are talking to me now, it's kind of like a flush. Hey, we got all this money. We're going to go spend it. Refresh everything. Get more over into Flash. I think they will sell a lot of Flash, even with the entry product, what they call a DE. I think they'll sell a lot of Flash there. And of course up in the DM series, which is the equivalent of NetApp's A200, A300 which are top tier products. They'll sell a lot of Flash there, too. >> I would say as what you just mentioned, the traditional storage market is reducing, but Flash is obviously growing. NetApp last quarter was the number one Flash company in the world. 27.6% market share-- >> Where do I check that out? (Rebecca laughs) That comes from another source >> That comes from another source, yeah sorry. But they hit number one last quarter according to an unknown source. But I think that's really encouraging, right? And at that part of the market Flash is about 30-40% of the overall storage market right now and easily the fastest growing. So this product range really drives an all-Flash array type solution that we can actually take advantage of. >> Rod, we want to get your perspective China, too. That's a big piece of this announcement. Maybe you an talk a little bit about that. I think Roger's got some comments on it. >> Well, think this is a good deal for NetApp. This is the reason why I think maybe the channel conflict won't be as bad as it was for the Dell EMC guys. This is the way for NetApp. NetApp wants to go more and more towards the Cloud. You look at their strategy. It's going more and more towards the Cloud with all of the Cloud data services software that they're developing. And so they're putting more and more emphasis on that. At the same time, the relationship they have with Lenovo gives them the opportunity to get really a creative revenue that otherwise would not get. Allows them maybe to reduce the burden that they would have under manufacturing SGNE expenses and stuff like that. But the big benefit is China. They JB in China is going to give NetApp a entry into China that otherwise would not be able to get because of the laws that the People's Republic of China have. It's a big deal. >> I think we're really excited about China. Obviously that's one of the cornerstones of the deal. So it's an independent organization that's going to be set up. Lenovo will have 51% ownership. NetApp will have 49. Seven board members. Four of them will be Lenovo. Three of them will be NetApp. And ultimately we are going to have that organization just purely specializing on the Lenovo product that is designed by NetApp originally. And it's going to be doing joint IP. We'll have joint developers in there. We'll be able to leverage my existing sales force in China, that's our traditional sales force, to go and drive for everything from a tier one city all the way down to a tier six, tier seven city in PRC. But, that joint venture itself will just be a specialist organization specifically on storage. It's really exciting. >> The thing about the JB it's very very important. Whatever is developed by the JB has to stay in China. That software cannot be taken outside of China because of all the geopolitical issues that you have around the world. Big point. >> Yeah, and a challenge. >> Absolutely It's a challenge that both NetApp and Lenovo have to manage with respect to each other. >> Just for the record, I'm not totally sure. If we develop something in the joint venture, I'm not totally sure that we have to keep that in China. >> I'm not saying that legally you have to. I'm saying emotionally you should. >> Emotional we should. >> Ahhh... >> I was going to say... >> There might be some government concerns on some of that. >> I think it's always going to depend on the government. And we don't want to get into a geopolitical conversation. I think Europe for example will be a lot more liberally open to that sort of stuff >> Speak a little bit about the cultures coming together. NetApp. You've been working on this deal together. sometimes that can be the strength or the challenge. >> I think company cultures are always challenging. And when you get two companies that are, especially right now, as we've heard this morning in some of the sessions, turning the corner. They're both growing. They're both doing very well at the moment. So, there's always a level of confidence, shall we say, in both those situations that you've just got to break down. And I think what we've done very successfully this time is Wei Wei, and George and Kirk, and George and Henri Ricard and myself and Brad Anderson, you saw today who was actually up on stage with us today as well working with us as the executive sponsor on that side. We're lining up our executives globally. All of the field team for Henri Ricard's team and my field team globally have all been interlocking with each other. They're account planning. They're territory planning. We're really trying to break down any of the walls the way may have from a cultural perspective. And really drive a much more open conversation, so we don't get caught out early in the deal. There's a escalation process in the deal. So it goes to a geo level up and then ends up with Henri and myself to actually manage worldwide if something was to get really out of control. But, at the moment, day one, don't see any issues. Seems to be going okay, touch wood. >> They both, Brad and Kirk, said they're complementary companies. Is that your perspective, too? Would you agree with that? >> Well, I think they gave complementary purposes. The interesting thing here is this thing's coming together when both companies are on the uptick. It's not because, go back three years ago and look at where NetApp was three years ago versus where they are today. So it's coming together when both companies, and matter of fact, go back to look at Lenovo two years ago as well >> Absolutely. >> So it's been an uptick that happened here over the last three years, so this thing's coming together when both companies are doing quite well in that respect. >> So-- >> By the way I want to mention Gartner will be publishing a report in September on this transaction from NetApp's point of view. And we'll be publishing a report on in November on this transaction from Lenovo's point of view. >> Great, so one of the things people like Roger and I have to do is, we look at how we would say whether something's successful or not. So I want to get your point first too and then when you look out six, 12, 18 months from now, whether it is successful and the thing I have to say is Kirk and Brad said, well, our goal is to number three in China, and I said isn't that a low bar? Aren't you practically on day one? I mean you're two joint companies. It's going to be there? >> I can't count on my boss to be honest with you. >> You've got the sales team. I know you can do that. >> I would love to. I think at the moment let's just talk about the joint venture for a second. I think the point is at the moment we are only 15% addressable market with our existing range. And so at the moment, we're saying, hey we can address 15% of the market. That puts us way outside of the number 10 slot in PRC. So, to say we want to be number three, is quite ambitious. Especially because we want to try to do it in the next couple of years. So, I actually feel like he's being quite aggressive from a growth perspective, so I think that's quite balanced. Outside of that, I really want to measure us on profitable growth. We really want to diversify our share of wallet and our customer base. We've got a great customer base now from a server perspective. We need to really expand that to ensure that we're taking advantage of the customer feedback we've had. So, I think that's a pretty good spot. >> At the end of the day, the success of non-success of this program is in Rod's hands. (laughing) On the one hand, >> I love the pressure you're putting me under >> And then Laura, on the services support side. People will support this program if they get good quality service and support. So, you have to keep that up for this program. >> Absolutely, and at the moment, the services model is level one and level two is run by Lenovo internally and then level three escalation runs into the NetApp program. We believe we've got a model that runs well. >> A good note to end on. Thanks so much for coming on theCUBE Rod and Roger. >> Thank you very much. >> Thanks for having us I appreciate it very much. It's my inaugural time here. >> First of many. I'm Rebecca Knight for Stu Miniman. We will have more from theCUBE at Lenovo Transform just in a little bit. (techno music)

(upbeat music) >> Live from New Orleans, Louisiana, it theCUBE. Covering .NEXT conference 2018, brought to you by Nutanix Welcome back to theCUBE's coverage of Nutanix .NEXT 2018. We're here in New Orleans, Louisiana. I'm Stu Miniman joined by my co-host Keith Townsend. And while this is the North America show, we've seen the expansion of it, we actually have two guests coming in from the Asia-Pacific region. Happy to welcome Rod Lappin. Rod, SVP with Lenovo, thank you so much for joining us all the way from Singapore. >> Yep, absolutely, great to be here. >> Stu: And we have Deepu George, who's the Senior Director with Capgemini Group IT, in from Bangalore Thank you also for joining us. >> Thank you for having me. >> Alright, so Deepu, let's start with you. We always love conferences like this. We get to talk to the users. Tell us a little bit about your group inside Capgemini, some of the challenges that your IT team's been tackling. >> Yes. So I'm part of the group IT, responsible for handling all the data centers, group data centers within Capgemini, and we are responsible for delivering data sorting services and processing services, et cetera. So, one of the key ideas we started last year was DC modernization and consolidation. And one of the key strategies we were looking at was hybrid cloud and extra DC stack, completed as revision stack, support for that and plus, you know, automation. So these were the three areas where, which was a key strategic areas for that data center modernization and consolidation. And when we looked at the various options available, one thing stood out from the Nutanix side was, I mean it checked all the boxes and they had a very good roadmap on certain areas which were not available at this particular point of time. So then we chose, okay let us have a PoC done, we did a PoC along with Lenovo and it was successful. And then we went ahead with this relationship with Nutanix. >> Great, Rod just want to bring you in here, we've been talking about really the growth and expansion of Netanix, one of the big pieces is the OEM. Lenovo have been hearing good growth rates. Give us a little bit of a customer viewpoint, what you've been seeing. Nutanix in general and the Lenovo HX specifically. >> Yeah I think obviously Stuart, the very exciting thing is Nutanix is the leader in the industry, right, and with them Lenovo this last year, we grew about 197%, year-on-year. So it makes us their fastest-growing partner. And in the North American channel environment, for example, you're at 280% actually, so we're growing very, very rapidly with them, and there's real reasons. Customers are seeing the value obviously in the solution, the consolidation of the data center footprint, and obviously as customers are being pushed more, as Deepu just mentioned, to the hybrid cloud, or what we're calling really the multi-cloud these days, right, because customers are really looking at and choosing their cloud solutions based more on the workloads and what they're actually trying to do longer-term. You know I think we're best positioned to do that with Nutanix, it's a great solution, I think Capgemini's really one of our great global, strategic global systems, integrated partners, that's taken a choice to run with Lenovo and Nutanix. It's been a great HX solution for us. >> So Rod, before we get too deep, let's ask a basic question. Lenovo, tier one server provider. You guys consistently in one of the leadership positions, and in number of units shipped, obviously you guys have the chops to field a similar solution. Why partner with Nutanix? >> Yeah I think Nutanix, firstly from a software perspective I think that's definitely where we're seeing, you know, if you jump back sort of 10, 15 years, that three-tiered architecture was where everyone was going, SAN and all that sort of stuff. Now when you're seeing the solutions that Nutanix and the hyper-converged market is growing so rapidly at, you're really seeing customers recognize that they get a lot more value out of the software suite, data center consolidation, data center footprint consolidation, and really the ability to manage on-prem and off-prem workloads seamlessly, you know with the prism solution and we integrate that with our Xclarity offering, our management suite, and as a result, it's a real match made in heaven. It's actually doing really well. >> So Deepu? >> I'll talk to that, if you look at software-defined, and that is a key area where we are going right now. Most of the organizations for this data consolidation, they are looking at software-defined, and when you look at the network stack, you have SDNs and all these things, so when you have Nutanix with an NCI, with the complete SD stack, it all ties up together. It's pretty easy for us to, you know, completely scale out the data centers. It's flexibility we have with software-defined and it's a good match, it's a good fit. >> Deepu can you walk us through a little bit of the application side of what you're doing? What did you start with? What have you rolled out? What haven't you touched yet? >> Yeah so once we started our PoC, once we know that data centers, so what we did was, we had our first data center consolidation exercise, modernization exercise, which just happened in Brazil. We had our own three data centers which we wanted to consolidate into one as part of our consolidation and modernize strategy. So we had a mix of upload there, we had basic things, we had normal applications, we had VMs running, we had physical nodes running. And what we did was we consolidated, moving into a single data center on 10 nodes of Nutanix, and we closed down all the other data centers and it was a pretty good experience that we had. The support we received from Lenovo and Nutanix and most of this work was done completely from off-shore. So we had a couple of our engineers posted in Brazil for the coordination activities, but the physical work was completely done from off-shore interfaced our support engineers. So it was a pretty good exercise. We got very good support from Nutanix. We got very good support from Lenovo to get consolation done in the correct time. >> So Deepu, Capgemini has a pretty capable consulting firm, I'm sure you guys got plenty of advice internally as you set out to select the vendor. Let's talk about that selection process. How did that conversation initially go, where you guys kind of threw out Nutanix and Lenovo as potential solutions? >> So if you look at the commercialization world right, I mean it's already pretty much standard. So when we looked at the key modernization initiatives, I already talked about this with VC and stuff like that. We came out with a list of parameters that we wanted to look at, just so that there cannot be any compromise on that. And then what we are looking for in the future when we, so modernization cannot happen in a day or two. So it is a journey. So we have a two- to three-year window in which we wanted to consolidate all our data centers, modernize everything, so the Nutanix roadmap on the various automation, STDC, as to the complete hybrid cloud journey, was pretty strong. And we had the complete management commitment from Nutanix, that they will stick to this particular roadmap and these features will not be compromised in any way. So that is one of the key decisions for us to go with the Nutanix way. >> Well let's talk about performance. You guys have been Nutanix customers for a while, how has the roadmap matched with the promises? >> So from a performance point-of-view, so if you look at only the pure CIA performance, right, wherever you have a high-performance workload, we have an option to go with a complete full SDN stack, where the BIOS in not absolutely a challenge or anything there's a huge throughput available. So from a performance point-of-view, we don't think, that's not an issue as of now. Even for the traditional storage, performance has never been an issue but the actual issue is how do we make the complete software available? How do we make the completely controlled from the software point-of-view. So there is where we found that that the CI use of very good challenging, you know, what do you call, user complete flexibility in how you want to define your data centers. >> Actual performance performance, that's really great. But I meant from the promises Nutanix made from a roadmap thing. This feature will be available on what day, you know, three months from now, a year from now. Were they actually able to deliver based on your own internal roadmap, and the capability you needed? >> Let me put it now this way. So if you look at the kind of investment that we have been making, in Nutanix and Lenovo, so you can be pretty much assured that these promises are kept 'cause otherwise we would not be making that. So Brazil was just a start that we are just going ahead. We are just looking at different workloads now. We have already looked at exchangeable close, which is currently in January and getting installed now. We have looked at video close one of the largest in Capgemini, we have 42 nodes of Nutanix running for 410,000 medias. So based out of Bangalore and Mumbai. So if we just, the performance, if it was not met I don't think we would have expanded the way we have expanded. >> Changed decisions. I think really ultimately, as Deepu mentioned, they started off with a pilot, as you mentioned, obviously in Brazil, and he's ended up taking this globally, which has been a great success story for both of our organizations. >> Right, could you give some more color on the partnership? >> Yeah sure, so I think Capgemini's a great global systems integrator for us. Both to sell to, obviously, as well as sell through, and they're doing some pretty amazing things with their customers and I think one of the great things that we're seeing in this particular instance, as we mentioned, Nutanix, leader in the hyper-converged space, and Deepu's made a call on them, based on their performance, and their basic feature set in their suite. And then ultimately Lenovo, who's number one customer service, number one reliability, number one quality in industry on independence, so you put 'em together, we ended up having a great relationship from that point, and then it's built confidence inside Capgemini now, for us to be going out to their customers and driving this solution out into their customer base. So it's once again, a great outcome for both of our organizations. >> Lenovo's been a traditional partner for us, it's not that new to us, so one of the major reasons is that they want a global reach and we have global data centers, and we have got global footprints, and it's a pretty good time. >> Deepu, how are you measuring the relationship? Any success metrics, from either the application deployments or you know, how do you measure internally and share that with your teams? >> So we have timelines on our consolidation, modernization, et cetera, as long as that is met, together with Lenovo, Nutanix, we are very good. >> So I'd love to hear about day two operations. What are some of the benefits you've seen from a people, resource talent, have you seen resources freed up to do other projects? What are some of the interesting projects that you've done as a result of freeing up time? >> So currently we are progressing through this particular journey, so this year we have a huge focus on the automation piece of the data center. So we are in the beginning stages of getting automation, automation in the sense that the normal proactive activates, all are given. So we are not talking about that, we are talking about the repetitive task, which is less part of the data center and that we have started. So basically we are looking around for any virtually reduction in our ticket volumes, our, you know, the normal work which is being done by the normal engineers so that the can be freed up for these kind of modernization projects. So that's what we are looking at, so let's see how it goes. >> Deepu, one of the things that we're talking about at this show is beyond just the HCI, it's cloud, even edge, what kind of futures do you see for Capgemini in general, and maybe with Nutanix and Lenovo relationship. >> As I said in the beginning, hybrid cloud was one of the requirements for choosing the correct partner for our data center modernization. So currently as we are beginning this part of the journey so moving the data seamlessly into the cloud is one of the key requirements of Capgemini. From an applications standpoint, from a visibility standpoint, et cetera, so we will be looking at which applications easy target for moving into the cloud, and we will be doing that and we believe that Nutanix, hybrid cloud technology will be able to help us in achieving that. >> And I think Stu, that's a really good point because I think what Deepu's just describing is effectively what we see happening in the industry everywhere. You know, we go back 20 years in the industry, a few of us have been around that long, and we remember like a homogeneous environment, everyone would say, I'm this vendor shop, they've got network administrators patching servers, when we're getting hardware put on site and customers are doing all of the integration on site themselves. That's just what the industry did back then. Now, as we see workloads changing it's a little bit like cloud. Three years ago everyone was like, I'm going to be this cloud vendor. That's it, that's my cloud vendor solution, right. However now it's become really acquiring the workload infrastructure and the software suites in line with customers' specific workload requirements, and so now, instead of going after the one cloud provider, now you've got a cloud provider in marketing, you've got a cloud provider in ERP, you've got a cloud provider in IT. So that's why this whole multi-cloud, hybrid cloud, type scenario's really starting to proliferate throughout the customer base. And you really find that, as Deepu just mentioned, they're starting, customers are really looking for how do they manage cloud, multiple clouds in multiple ways, with different workloads, and they're really going out and looking and exploring, how to best address that and I thing once again the Nutanix-Lenovo solution's fantastic for that. I mean you're going to see that proliferate more and more in the industry over the next couple of years. >> So one of the, sorry Stu, one of the comments throughout the show has been, you know what, and this is not a pick on Nutanix or anyone else, I just, both of you guys are not from North America or Western Europe, is that the focus, a lot of vendor's focus has been on Western Europe and America, from a cloud perspective. How do you feel that Nutanix relationship from both a customer and as a partner, has been, on expanding capability beyond North American and Western Europe clouds? >> Rod: Why don't you go first, Deepu. >> Yeah, so if you look at, traditional Amazon Azure, so we have their clouds which are already available in India. So we have been checking that now, we have been looking at various options for the biggest workloads. But predominantly, our predominant workloads have been on the European and the North American cloud for lots of reasons, because if you look at Amazon or Azure, they're coming recently into the Asian footprint with (mumbles) if I'm not mistaken. Yeah, but I mean I think we will get there. >> So I think from our perspective, we break the world into five different geographies. So China, Asia-Pacific, Europe, North America and South America. And when you look at our earnings this last quarter, I'm only about two weeks away from our next earnings so I can't say anything about Q1, but the Q4, calendar Q4, we grew about 17% year-on-year but we grew double-digit growth in every one of those geographies, consistently. So in Nutanix, with our HX solution, which is really what we're talking about today, my Asia-Pacific team is growing just as fast, if not actually a little bit faster, than my North America teams. So we see that this technology actually being a real world-wide phenomenon and it's really growing everywhere. Japan is fantastic, India's fantastic for me. Obviously Western Europe. Deepu's a great example, 'cause he's deploying this globally across all of the geographies and I think we're seeing a lot of our G2000 customers, really addressing that, that way. But we see a lot of local companies as well, driving it across the geographies. Asia-Pacific's a great example. >> So if you look at, again, from a CA Nutanix-Lenovo standpoint, we have been going evening everything out so we have recently done that on 16 nodes within Bangalore and Mumbai, so that's a pretty good story. >> Alright, well, Deepu George, thank you so much for joining us, Rod Lappin, always a pleasure to catch up with you. >> Thanks Stu, thanks Keith. >> For Keith Townsend, I'm Stu Miniman, we've got a full day of Day 2 coverage here of theCUBE and Nutanix .NEXT 2018, thanks so much for watching theCUBE. >> Thank you. >> Thank you. (bright music)

(upbeat techno music) >> Announcer: Good morning ladies and gentlemen. This is Lenovo Transform. Please welcome to the stage Lenovo's Rod Lappin. (upbeat instrumental) >> Alright, ladies and gentlemen. Here we go. I was out the back having a chat. A bit faster than I expected. How are you all doing this morning? (crowd cheers) >> Good? How fantastic is it to be in New York City? (crowd applauds) Excellent. So my name's Rod Lappin. I'm with the Data Center Group, obviously. I do basically anything that touches customers from our sales people, our pre-sales engineers, our architects, et cetera, all the way through to our channel partner sales engagement globally. So that's my job, but enough of that, okay? So the weather this morning, absolutely fantastic. Not a cloud in the sky, perfect. A little bit different to how it was yesterday, right? I want to thank all of you because I know a lot of you had a lot of commuting issues getting into New York yesterday with all the storms. We have a lot of people from international and domestic travel caught up in obviously the network, which blows my mind, actually, but we have a lot of people here from Europe, obviously, a lot of analysts and media people here as well as customers who were caught up in circling around the airport apparently for hours. So a big round of applause for our team from Europe. (audience applauds) Thank you for coming. We have some people who commuted a very short distance. For example, our own server general manager, Cameron (mumbles), he's out the back there. Cameron, how long did it take you to get from Raleigh to New York? An hour-and-a-half flight? >> Cameron: 17 hours. >> 17 hours, ladies and gentleman. That's a fantastic distance. I think that's amazing. But I know a lot of us, obviously, in the United States have come a long way with the storms, obviously very tough, but I'm going to call out one individual. Shaneil from Spotless. Where are you Shaneil, you're here somewhere? There he is from Australia. Shaneil how long did it take you to come in from Australia? 25 hour, ladies and gentleman. A big round of applause. That's a pretty big effort. Shaneil actually I want you to stand up, if you don't mind. I've got a seat here right next to my CEO. You've gone the longest distance. How about a big round of applause for Shaneil. We'll put him in my seat, next to YY. Honestly, Shaneil, you're doing me a favor. Okay ladies and gentlemen, we've got a big day today. Obviously, my seat now taken there, fantastic. Obviously New York City, the absolute pinnacle of globalization. I first came to New York in 1996, which was before a lot of people in the room were born, unfortunately for me these days. Was completely in awe. I obviously went to a Yankees game, had no clue what was going on, didn't understand anything to do with baseball. Then I went and saw Patrick Ewing. Some of you would remember Patrick Ewing. Saw the Knicks play basketball. Had no idea what was going on. Obviously, from Australia, and somewhat slightly height challenged, basketball was not my thing but loved it. I really left that game... That was the first game of basketball I'd ever seen. Left that game realizing that effectively the guy throws the ball up at the beginning, someone taps it, that team gets it, they run it, they put it in the basket, then the other team gets it, they put it in the basket, the other team gets it, and that's basically the entire game. So I haven't really progressed from that sort of learning or understanding of basketball since then, but for me, personally, being here in New York, and obviously presenting with all of you guys today, it's really humbling from obviously some of you would have picked my accent, I'm also from Australia. From the north shore of Sydney. To be here is just a fantastic, fantastic event. So welcome ladies and gentlemen to Transform, part of our tech world series globally in our event series and our event season here at Lenovo. So once again, big round of applause. Thank you for coming (audience applauds). Today, basically, is the culmination of what I would classify as a very large journey. Many of you have been with us on that. Customers, partners, media, analysts obviously. We've got quite a lot of our industry analysts in the room. I know Matt Eastwood yesterday was on a train because he sent a Tweet out saying there's 170 people on the WIFI network. He was obviously a bit concerned he was going to get-- Pat Moorhead, he got in at 3:30 this morning, obviously from traveling here as well with some of the challenges with the transportation, so we've got a lot of people in the room that have been giving us advice over the last two years. I think all of our employees are joining us live. All of our partners and customers through the stream. As well as everybody in this packed-out room. We're very very excited about what we're going to be talking to you all today. I want to have a special thanks obviously to our R&D team in Raleigh and around the world. They've also been very very focused on what they've delivered for us today, and it's really important for them to also see the culmination of this great event. And like I mentioned, this is really the feedback. It's not just a Lenovo launch. This is a launch based on the feedback from our partners, our customers, our employees, the analysts. We've been talking to all of you about what we want to be when we grow up from a Data Center Group, and I think you're going to hear some really exciting stuff from some of the speakers today and in the demo and breakout sessions that we have after the event. These last two years, we've really transformed the organization, and that's one of the reasons why that theme is part of our Tech World Series today. We're very very confident in our future, obviously, and where the company's going. It's really important for all of you to understand today and take every single snippet that YY, Kirk, and Christian talk about today in the main session, and then our presenters in the demo sections on what Lenovo's actually doing for its future and how we're positioning the company, obviously, for that future and how the transformation, the digital transformation, is going ahead globally. So, all right, we are now going to step into our Transform event. And I've got a quick agenda statement for you. The very first thing is we're going to hear from YY, our chairman and CEO. He's going to discuss artificial intelligence, the evolution of our society and how Lenovo is clearly positioning itself in the industry. Then, obviously, you're going to hear from Kirk Skaugen, our president of the Data Center Group, our new boss. He's going to talk about how long he's been with the company and the transformation, once again, we're making, very specifically to the Data Center Group and how much of a difference we're making to society and some of our investments. Christian Teismann, our SVP and general manager of our client business is going to talk about the 25 years of ThinkPad. This year is the 25-year anniversary of our ThinkPad product. Easily the most successful brand in our client branch or client branch globally of any vendor. Most successful brand we've had launched, and this afternoon breakout sessions, obviously, with our keynotes, fantastic sessions. Make sure you actually attend all of those after this main arena here. Now, once again, listen, ask questions, and make sure you're giving us feedback. One of the things about Lenovo that we say all the time... There is no room for arrogance in our company. Every single person in this room is a customer, partner, analyst, or an employee. We love your feedback. It's only through your feedback that we continue to improve. And it's really important that through all of the sessions where the Q&As happen, breakouts afterwards, you're giving us feedback on what you want to see from us as an organization as we go forward. All right, so what were you doing 25 years ago? I spoke about ThinkPad being 25 years old, but let me ask you this. I bet you any money that no one here knew that our x86 business is also 25 years old. So, this year, we have both our ThinkPad and our x86 anniversaries for 25 years. Let me tell you. What were you guys doing 25 years ago? There's me, 25 years ago. It's a bit scary, isn't it? It's very svelte and athletic and a lot lighter than I am today. It makes me feel a little bit conscious. And you can see the black and white shot. It shows you that even if you're really really short and you come from the wrong side of the tracks to make some extra cash, you can still do some modeling as long as no one else is in the photo to give anyone any perspective, so very important. I think I might have got one photo shoot out of that, I don't know. I had to do it, I needed the money. Let me show you another couple of photos. Very interesting, how's this guy? How cool does he look? Very svelte and athletic. I think there's no doubt. He looks much much cooler than I do. Okay, so ladies and gentlemen, without further ado, it gives me great honor to obviously introduce our very very first guest to the stage. Ladies and gentlemen, our chairman and CEO, Yuanqing Yang. or as we like to call him, YY. A big round of applause, thank you. (upbeat techno instrumental) >> Good morning everyone. Thank you, Rod, for your introduction. Actually, I didn't think I was younger than you (mumbles). I can't think of another city more fitting to host the Transform event than New York. A city that has transformed from a humble trading post 400 years ago to one of the most vibrant cities in the world today. It is a perfect symbol of transformation of our world. The rapid and the deep transformations that have propelled us from the steam engine to the Internet era in just 200 years. Looking back at 200 years ago, there was only a few companies that operated on a global scale. The total value of the world's economy was around $188 billion U.S. dollars. Today, it is only $180 for each person on earth. Today, there are thousands of independent global companies that compete to sell everything, from corn and crude oil to servers and software. They drive a robust global economy was over $75 trillion or $1,000 per person. Think about it. The global economy has multiplied almost 450 times in just two centuries. What is even more remarkable is that the economy has almost doubled every 15 years since 1950. These are significant transformation for businesses and for the world and our tiny slice of pie. This transformation is the result of the greatest advancement in technology in human history. Not one but three industrial revolutions have happened over the last 200 years. Even though those revolutions created remarkable change, they were just the beginning. Today, we are standing at the beginning of the fourth revolution. This revolution will transform how we work (mumbles) in ways that no one could imagine in the 18th century or even just 18 months ago. You are the people who will lead this revolution. Along with Lenovo, we will redefine IT. IT is no longer just information technology. It's intelligent technology, intelligent transformation. A transformation that is driven by big data called computing and artificial intelligence. Even the transition from PC Internet to mobile Internet is a big leap. Today, we are facing yet another big leap from the mobile Internet to the Smart Internet or intelligent Internet. In this Smart Internet era, Cloud enables devices, such as PCs, Smart phones, Smart speakers, Smart TVs. (mumbles) to provide the content and the services. But the evolution does not stop them. Ultimately, almost everything around us will become Smart, with building computing, storage, and networking capabilities. That's what we call the device plus Cloud transformation. These Smart devices, incorporated with various sensors, will continuously sense our environment and send data about our world to the Cloud. (mumbles) the process of this ever-increasing big data and to support the delivery of Cloud content and services, the data center infrastructure is also transforming to be more agile, flexible, and intelligent. That's what we call the infrastructure plus Cloud transformation. But most importantly, it is the human wisdom, the people learning algorithm vigorously improved by engineers that enables artificial intelligence to learn from big data and make everything around us smarter. With big data collected from Smart devices, computing power of the new infrastructure under the trend artificial intelligence, we can understand the world around us more accurately and make smarter decisions. We can make life better, work easier, and society safer and healthy. Think about what is already possible as we start this transformation. Smart Assistants can help you place orders online with a voice command. Driverless cars can run on the same road as traditional cars. (mumbles) can help troubleshoot customers problems, and the virtual doctors already diagnose basic symptoms. This list goes on and on. Like every revolution before it, intelligent transformation, will fundamentally change the nature of business. Understanding and preparing for that will be the key for the growth and the success of your business. The first industrial revolution made it possible to maximize production. Water and steam power let us go from making things by hand to making them by machine. This transformed how fast things could be produced. It drove the quantity of merchandise made and led to massive increase in trade. With this revolution, business scale expanded, and the number of customers exploded. Fifty years later, the second industrial revolution made it necessary to organize a business like the modern enterprise, electric power, and the telegraph communication made business faster and more complex, challenging businesses to become more efficient and meeting entirely new customer demands. In our own lifetimes, we have witnessed the third industrial revolution, which made it possible to digitize the enterprise. The development of computers and the Internet accelerated business beyond human speed. Now, global businesses have to deal with customers at the end of a cable, not always a handshake. While we are still dealing with the effects of a digitizing business, the fourth revolution is already here. In just the past two or three years, the growth of data and advancement in visual intelligence has been astonishing. The computing power can now process the massive amount of data about your customers, suppliers, partners, competitors, and give you insights you simply could not imagine before. Artificial intelligence can not only tell you what your customers want today but also anticipate what they will need tomorrow. This is not just about making better business decisions or creating better customer relationships. It's about making the world a better place. Ultimately, can we build a new world without diseases, war, and poverty? The power of big data and artificial intelligence may be the revolutionary technology to make that possible. Revolutions don't happen on their own. Every industrial revolution has its leaders, its visionaries, and its heroes. The master transformers of their age. The first industrial revolution was led by mechanics who designed and built power systems, machines, and factories. The heroes of the second industrial revolution were the business managers who designed and built modern organizations. The heroes of the third revolution were the engineers who designed and built the circuits and the source code that digitized our world. The master transformers of the next revolution are actually you. You are the designers and the builders of the networks and the systems. You will bring the benefits of intelligence to every corner of your enterprise and make intelligence the central asset of your business. At Lenovo, data intelligence is embedded into everything we do. How we understand our customer's true needs and develop more desirable products. How we profile our customers and market to them precisely. How we use internal and external data to balance our supply and the demand. And how we train virtual agents to provide more effective sales services. So the decisions you make today about your IT investment will determine the quality of the decisions your enterprise will make tomorrow. So I challenge each of you to seize this opportunity to become a master transformer, to join Lenovo as we work together at the forefront of the fourth industrial revolution, as leaders of the intelligent transformation. (triumphant instrumental) Today, we are launching the largest portfolio in our data center history at Lenovo. We are fully committed to the (mumbles) transformation. Thank you. (audience applauds) >> Thanks YY. All right, ladies and gentlemen. Fantastic, so how about a big round of applause for YY. (audience applauds) Obviously a great speech on the transformation that we at Lenovo are taking as well as obviously wanting to journey with our partners and customers obviously on that same journey. What I heard from him was obviously artificial intelligence, how we're leveraging that integrally as well as externally and for our customers, and the investments we're making in the transformation around IoT machine learning, obviously big data, et cetera, and obviously the Data Center Group, which is one of the key things we've got to be talking about today. So we're on the cusp of that fourth revolution, as YY just mentioned, and Lenovo is definitely leading the way and investing in those parts of the industry and our portfolio to ensure we're complimenting all of our customers and partners on what they want to be, obviously, as part of this new transformation we're seeing globally. Obviously now, ladies and gentlemen, without further ado once again, to tell us more about what's going on today, our announcements, obviously, that all of you will be reading about and seeing in the breakout and the demo sessions with our segment general managers this afternoon is our president of the data center, Mr. Kirk Skaugen. (upbeat instrumental) >> Good morning, and let me add my welcome to Transform. I just crossed my six months here at Lenovo after over 24 years at Intel Corporation, and I can tell you, we've been really busy over the last six months, and I'm more excited and enthusiastic than ever and hope to share some of that with you today. Today's event is called "Transform", and today we're announcing major new transformations in Lenovo, in the data center, but more importantly, we're celebrating the business results that these platforms are going to have on society and with international supercomputing going on in parallel in Frankfurt, some of the amazing scientific discoveries that are going to happen on some of these platforms. Lenovo has gone through some significant transformations in the last two years, since we acquired the IBM x86 business, and that's really positioning us for this next phase of growth, and we'll talk more about that later. Today, we're announcing the largest end-to-end data center portfolio in Lenovo's history, as you heard from YY, and we're really taking the best of the x86 heritage from our IBM acquisition of the x86 server business and combining that with the cost economics that we've delivered from kind of our China heritage. As we've talked to some of the analysts in the room, it's really that best of the east and best of the west is combining together in this announcement today. We're going to be announcing two new brands, building on our position as the number one x86 server vendor in both customer satisfaction and in reliability, and we're also celebrating, next month in July, a very significant milestone, which will we'll be shipping our 20 millionth x86 server into the industry. For us, it's an amazing time, and it's an inflection point to kind of look back, pause, but also share the next phase of Lenovo and the exciting vision for the future. We're also making some declarations on our vision for the future today. Again, international supercomputing's going on, and, as it turns out, we're the fastest growing supercomputer company on earth. We'll talk about that. Our goal today that we're announcing is that we plan in the next several years to become number one in supercomputing, and we're going to put the investments behind that. We're also committing to our customers that we're going to disrupt the status quo and accelerate the pace of innovation, not just in our legacy server solutions, but also in Software-Defined because what we've heard from you is that that lack of legacy, we don't have a huge router business or a huge sand business to protect. It's that lack of legacy that's enabling us to invest and get ahead of the curb on this next transition to Software-Defined. So you're going to see us doing that through building our internal IP, through some significant joint ventures, and also through some merges and acquisitions over the next several quarters. Altogether, we're driving to be the most trusted data center provider in the industry between us and our customers and our suppliers. So a quick summary of what we're going to dive into today, both in my keynote as well as in the breakout sessions. We're in this transformation to the next phase of Lenovo's data center growth. We're closing out our previous transformation. We actually, believe it or not, in the last six months or so, have renegotiated 18,000 contracts in 160 countries. We built out an entire end-to-end organization from development and architecture all the way through sales and support. This next transformation, I think, is really going to excite Lenovo shareholders. We're building the largest data center portfolio in our history. I think when IBM would be up here a couple years ago, we might have two or three servers to announce in time to market with the next Intel platform. Today, we're announcing 14 new servers, seven new storage systems, an expanded set of networking portfolios based on our legacy with Blade Network Technologies and other companies we've acquired. Two new brands that we'll talk about for both data center infrastructure and Software-Defined, a new set of premium premiere services as well as a set of engineered solutions that are going to help our customers get to market faster. We're going to be celebrating our 20 millionth x86 server, and as Rod said, 25 years in x86 server compute, and Christian will be up here talking about 25 years of ThinkPad as well. And then a new end-to-end segmentation model because all of these strategies without execution are kind of meaningless. I hope to give you some confidence in the transformation that Lenovo has gone through as well. So, having observed Lenovo from one of its largest partners, Intel, for more than a couple decades, I thought I'd just start with why we have confidence on the foundation that we're building off of as we move from a PC company into a data center provider in a much more significant way. So Lenovo today is a company of $43 billion in sales. Absolutely astonishing, it puts us at about Fortune 202 as a company, with 52,000 employees around the world. We're supporting and have service personnel, almost a little over 10,000 service personnel that service our servers and data center technologies in over 160 countries that provide onsite service and support. We have seven data center research centers. One of the reasons I came from Intel to Lenovo was that I saw that Lenovo became number one in PCs, not through cost cutting but through innovation. It was Lenovo that was partnering on the next-generation Ultrabooks and two-in-ones and tablets in the modem mods that you saw, but fundamentally, our path to number one in data center is going to be built on innovation. Lastly, we're one of the last companies that's actually building not only our own motherboards at our own motherboard factories, but also with five global data center manufacturing facilities. Today, we build about four devices a second, but we also build over 100 servers per hour, and the cost economics we get, and I just visited our Shenzhen factory, of having everything from screws to microprocessors come up through the elevator on the first floor, go left to build PCs and ThinkPads and go right to build server technology, means we have some of the world's most cost effective solutions so we can compete in things like hyperscale computing. So it's with that that I think we're excited about the foundation that we can build off of on the Data Center Group. Today, as we stated, this event is about transformation, and today, I want to talk about three things we're going to transform. Number one is the customer experience. Number two is the data center and our customer base with Software-Defined infrastructure, and then the third is talk about how we plan to execute flawlessly with a new transformation that we've had internally at Lenovo. So let's dive into it. On customer experience, really, what does it mean to transform customer experience? Industry pundits say that if you're not constantly innovating, you can fall behind. Certainly the technology industry that we're in is transforming at record speed. 42% of business leaders or CIOs say that digital first is their top priority, but less than 50% actually admit that they have a strategy to get there. So people are looking for a partner to keep pace with that innovation and change, and that's really what we're driving to at Lenovo. So today we're announcing a set of plans to take another step function in customer experience, and building off of our number one position. Just recently, Gartner shows Lenovo as the number 24 supply chains of companies over $12 billion. We're up there with Amazon, Coca-Cola, and we've now completely re-architected our supply chain in the Data Center Group from end to end. Today, we can deliver 90% of our SKUs, order to ship in less than seven days. The artificial intelligence that YY mentioned is optimizing our performance even further. In services, as we talked about, we're now in 160 countries, supporting on-site support, 50 different call centers around the world for local language support, and we're today announcing a whole set of new premiere support services that I'll get into in a second. But we're building on what's already better than 90% customer satisfaction in this space. And then in development, for all the engineers out there, we started foundationally for this new set of products, talking about being number one in reliability and the lowest downtime of any x86 server vendor on the planet, and these systems today are architected to basically extend that leadership position. So let me tell you the realities of reliability. This is ITIC, it's a reliability report. 750 CIOs and IT managers from more than 20 countries, so North America, Europe, Asia, Australia, South America, Africa. This isn't anything that's paid for with sponsorship dollars. Lenovo has been number one for four years running on x86 reliability. This is the amount of downtime, four hours or more, in mission-critical environments from the leading x86 providers. You can see relative to our top two competitors that are ahead of us, HP and Dell, you can see from ITIC why we are building foundationally off of this, and why it's foundational to how we're developing these new platforms. In customer satisfaction, we are also rated number one in x86 server customer satisfaction. This year, we're now incentivizing every single Lenovo employee on customer satisfaction and customer experience. It's been a huge mandate from myself and most importantly YY as our CEO. So you may say well what is the basis of this number one in customer satisfaction, and it's not just being number one in one category, it's actually being number one in 21 of the 22 categories that TBR talks about. So whether it's performance, support systems, online product information, parts and availability replacement, Lenovo is number one in 21 of the 22 categories and number one for six consecutive studies going back to Q1 of 2015. So this, again, as we talk about the new product introductions, it's something that we absolutely want to build on, and we're humbled by it, and we want to continue to do better. So let's start now on the new products and talk about how we're going to transform the data center. So today, we are announcing two new product offerings. Think Agile and ThinkSystem. If you think about the 25 years of ThinkPad that Christian's going to talk about, Lenovo has a continuous learning culture. We're fearless innovators, we're risk takers, we continuously learn, but, most importantly, I think we're humble and we have some humility. That when we fail, we can fail fast, we learn, and we improve. That's really what drove ThinkPad to number one. It took about eight years from the acquisition of IBM's x86 PC business before Lenovo became number one, but it was that innovation, that listening and learning, and then improving. As you look at the 25 years of ThinkPad, there were some amazing successes, but there were also some amazing failures along the way, but each and every time we learned and made things better. So this year, as Rod said, we're not just celebrating 25 years of ThinkPad, but we're celebrating 25 years of x86 server development since the original IBM PC servers in 1992. It's a significant day for Lenovo. Today, we're excited to announce two new brands. ThinkSystem and ThinkAgile. It's an important new announcement that we started almost three years ago when we acquired the x86 server business. Why don't we run a video, and we'll show you a little bit about ThinkSystem and ThinkAgile. >> Narrator: The status quo is comfortable. It gets you by, but if you think that's good enough for your data center, think again. If adoption is becoming more complicated when it should be simpler, think again. If others are selling you technology that's best for them, not for you, think again. It's time for answers that win today and tomorrow. Agile, innovative, different. Because different is better. Different embraces change and makes adoption simple. Different designs itself around you. Using 25 years of innovation and design and R&D. Different transforms, it gives you ThinkSystem. World-record performance, most reliable, easy to integrate, scales faster. Different empowers you with ThinkAgile. It redefines the experience, giving you the speed of Cloud and the control of on-premise IT. Responding faster to what your business really needs. Different defines the future. Introducing Lenovo ThinkSystem and ThinkAgile. (exciting and slightly aggressive digital instrumental) >> All right, good stuff, huh? (audience applauds) So it's built off of this 25-year history of us being in the x86 server business, the commitment we established three years ago after acquiring the x86 server business to be and have the most reliable, the most agile, and the most highest-performing data center solutions on the planet. So today we're announcing two brands. ThinkSystem is for the traditional data center infrastructure, and ThinkAgile is our brand for Software-Defined infrastructure. Again, the teams challenge themselves from the start, how do we build off this rich heritage, expanding our position as number one in customer satisfaction, reliability, and one of the world's best supply chains. So let's start and look at the next set of solutions. We have always prided ourself that little things don't mean a lot. Little things mean everything. So today, as we said on the legacy solutions, we have over 30 world-record performance benchmarks on Intel architecture, and more than actually 150 since we started tracking this back in 2001. So it's the little pieces of innovation. It's the fine tuning that we do with our partners like an Intel or a Microsoft, an SAP, VMware, and Nutanix that's enabling us to get these world-record performance benchmarks, and with this next generation of solutions we think we'll continue to certainly do that. So today we're announcing the most comprehensive portfolio ever in our data center history. There's 14 servers, seven storage devices, and five network switches. We're also announcing, which is super important to our customer base, a set of new premiere service options. That's giving you fast access directly to a level two support person. No automated response system involved. You get to pick up the phone and directly talk to a level two support person that's going to have end-to-end ownership of the customer experience for ThinkSystem. With ThinkAgile, that's going to be completely bundled with every ThinkAgile you purchase. In addition, we're having white glove service on site that will actually unbox the product for you and get it up and running. It's an entirely new set of solutions for hybrid Cloud, for big data analytics and database applications around these engineered solutions. These are like 40- to 50-page guides where we fine-tuned the most important applications around virtual desktop infrastructure and those kinds of applications, working side by side with all of our ISP partners. So significantly expanding, not just the hardware but the software solutions that, obviously, you, as our customers, are running. So if you look at ThinkSystem innovation, again, it was designed for the ultimate in flexibility, performance, and reliability. It's a single now-unified brand that combines what used to be the Lenovo Think server and the IBM System x products now into a single brand that spans server, storage, and networking. We're basically future-proofing it for the next-generation data center. It's a significantly simplified portfolio. One of the big pieces that we've heard is that the complexity of our competitors has really been overwhelming to customers. We're building a more flexible, more agile solution set that requires less work, less qualification, and more future proofing. There's a bunch of things in this that you'll see in the demos. Faster time-to-service in terms of the modularity of the systems. 12% faster service equating to almost $50 thousand per hour of reduced downtime. Some new high-density options where we have four nodes and a 2U, twice the density to improve and reduce outbacks and mission-critical workloads. And then in high-performance computing and supercomputing, we're going to spend some time on that here shortly. We're announcing new water-cooled solutions. We have some of the most premiere water-cooled solutions in the world, with more than 25 patents pending now, just in the water-cooled solutions for supercomputing. The performance that we think we're going to see out of these systems is significant. We're building off of that legacy that we have today on the existing Intel solutions. Today, we believe we have more than 50% of SAP HANA installations in the world. In fact, SAP just went public that they're running their internal SAP HANA on Lenovo hardware now. We're seeing a 59% increase in performance on SAP HANA generation on generation. We're seeing 31% lower total cost to ownership. We believe this will continue our position of having the highest level of five-nines in the x86 server industry. And all of these servers will start being available later this summer when the Intel announcements come out. We're also announcing the largest storage portfolio in our history, significantly larger than anything we've done in the past. These are all available today, including some new value class storage offerings. Our network portfolio is expanding now significantly. It was a big surprise when I came to Lenovo, seeing the hundreds of engineers we had from the acquisition of Blade Network Technologies and others with our teams in Romania, Santa Clara, really building out both the embedded portfolio but also the top racks, which is around 10 gig, 25 gig, and 100 gig. Significantly better economics, but all the performance you'd expect from the largest networking companies in the world. Those are also available today. ThinkAgile and Software-Defined, I think the one thing that has kind of overwhelmed me since coming in to Lenovo is we are being embraced by our customers because of our lack of legacy. We're not trying to sell you one more legacy SAN at 65% margins. ThinkAgile really was founded, kind of born free from the shackles of legacy thinking and legacy infrastructure. This is just the beginning of what's going to be an amazing new brand in the transformation to Software-Defined. So, for Lenovo, we're going to invest in our own internal organic IP. I'll foreshadow: There's some significant joint ventures and some mergers and acquisitions that are going to be coming in this space. And so this will be the foundation for our Software-Defined networking and storage, for IoT, and ultimately for the 5G build-out as well. This is all built for data centers of tomorrow that require fluid resources, tightly integrated software and hardware in kind of an appliance, selling at the rack level, and so we'll show you how that is going to take place here in a second. ThinkAgile, we have a few different offerings. One is around hyperconverged storage, Hybrid Cloud, and also Software-Defined storage. So we're really trying to redefine the customer experience. There's two different solutions we're having today. It's a Microsoft Azure solution and a Nutanix solution. These are going to be available both in the appliance space as well as in a full rack solution. We're really simplifying and trying to transform the entire customer experience from how you order it. We've got new capacity planning tools that used to take literally days for us to get the capacity planning done. It's now going down to literally minutes. We've got new order, delivery, deployment, administration service, something we're calling ThinkAgile Advantage, which is the white glove unboxing of the actual solutions on prem. So the whole thing when you hear about it in the breakout sessions about transforming the entire customer experience with both an HX solution and an SX solution. So again, available at the rack level for both Nutanix and for Microsoft Solutions available in just a few months. Many of you in the audience since the Microsoft Airlift event in Seattle have started using these things, and the feedback to date has been fantastic. We appreciate the early customer adoption that we've seen from people in the audience here. So next I want to bring up one of our most important partners, and certainly if you look at all of these solutions, they're based on the next-generation Intel Xeon scalable processor that's going to be announcing very very soon. I want to bring on stage Rupal Shah, who's the corporate vice president and general manager of Global Data Center Sales with Intel, so Rupal, please join me. (upbeat instrumental) So certainly I have long roots at Intel, but why don't you talk about, from Intel's perspective, why Lenovo is an important partner for Lenovo. >> Great, well first of all, thank you very much. I've had the distinct pleasure of not only working with Kirk for many many years, but also working with Lenovo for many years, so it's great to be here. Lenovo is not only a fantastic supplier and leader in the industry for Intel-based servers but also a very active partner in the Intel ecosystem. In the Intel ecosystem, specifically, in our partner programs and in our builder programs around Cloud, around the network, and around storage, I personally have had a long history in working with Lenovo, and I've seen personally that PC transformation that you talked about, Kirk, and I believe, and I know that Intel believes in Lenovo's ability to not only succeed in the data center but to actually lead in the data center. And so today, the ThinkSystem and ThinkAgile announcement is just so incredibly important. It's such a great testament to our two companies working together, and the innovation that we're able to bring to the market, and all of it based on the Intel Xeon scalable processor. >> Excellent, so tell me a little bit about why we've been collaborating, tell me a little bit about why you're excited about ThinkSystem and ThinkAgile, specifically. >> Well, there are a lot of reasons that I'm excited about the innovation, but let me talk about a few. First, both of our companies really stand behind the fact that it's increasingly a hybrid world. Our two companies offer a range of solutions now to customers to be able to address their different workload needs. ThinkSystem really brings the best, right? It brings incredible performance, flexibility in data center deployment, and industry-leading reliability that you've talked about. And, as always, Xeon has a history of being built for the data center specifically. The Intel Xeon scalable processor is really re-architected from the ground up in order to enhance compute, network, and storage data flows so that we can deliver workload optimized performance for both a wide range of traditional workloads and traditional needs but also some emerging new needs in areas like artificial intelligence. Second is when it comes to the next generation of Cloud infrastructure, the new Lenovo ThinkAgile line offers a truly integrated offering to address data center pain points, and so not only are you able to get these pretested solutions, but these pretested solutions are going to get deployed in your infrastructure faster, and they're going to be deployed in a way that's going to meet your specific needs. This is something that is new for both of us, and it's an incredible innovation in the marketplace. I think that it's a great addition to what is already a fantastic portfolio for Lenovo. >> Excellent. >> Finally, there's high-performance computing. In high-performance computing. First of all, congratulations. It's a big week, I think, for both of us. Fantastic work that we've been doing together in high-performance computing and actually bringing the best of the best to our customers, and you're going to hear a whole lot more about that. We obviously have a number of joint innovation centers together between Intel and Lenovo. Tell us about some of the key innovations that you guys are excited about. >> Well, Intel and Lenovo, we do have joint innovation labs around the world, and we have a long and strong history of very tight collaboration. This has brought a big wave of innovation to the marketplace in areas like software-defined infrastructure. Yet another area is working closely on a joint vision that I think our two companies have in artificial intelligence. Intel is very committed to the world of AI, and we're committed in making the investments required in technology development, in training, and also in R&D to be able to deliver end-to-end solutions. So with Intel's comprehensive technology portfolio and Lenovo's development and innovation expertise, it's a great combination in this space. I've already talked a little bit about HPC and so has Kirk, and we're going to hear a little bit more to come, but we're really building the fastest compute solutions for customers that are solving big problems. Finally, we often talk about processors from Intel, but it's not just about the processors. It's way beyond that. It's about engaging at the solution level for our customers, and I'm so excited about the work that we've done together with Lenovo to bring to market products like Intel Omni-Path Architecture, which is really the fabric for high-performance data centers. We've got a great showing this week with Intel Omni-Path Architecture, and I'm so grateful for all the work that we've done to be able to bring true solutions to the marketplace. I am really looking forward to our future collaboration with Lenovo as we have in the past. I want to thank you again for inviting me here today, and congratulations on a fantastic launch. >> Thank you, Rupal, very much, for the long partnership. >> Thank you. (audience applauds) >> Okay, well now let's transition and talk a little bit about how Lenovo is transforming. The first thing we've done when I came on board about six months ago is we've transformed to a truly end-to-end organization. We're looking at the market segments I think as our customers define them, and we've organized into having vice presidents and senior vice presidents in charge of each of these major groups, thinking really end to end, from architecture all the way to end of life and customer support. So the first is hyperscale infrastructure. It's about 20% on the market by 2020. We've hired a new vice president there to run that business. Given we can make money in high-volume desktop PCs, it's really the manufacturing prowess, deep engineering collaboration that's enabling us to sell into Baidu, and to Alibaba, Tencent, as well as the largest Cloud vendors on the West Coast here in the United States. We believe we can make money here by having basically a deep deep engineering engagement with our key customers and building on the PC volume economics that we have within Lenovo. On software-defined infrastructure, again, it's that lack of legacy that I think is propelling us into this space. We're not encumbered by trying to sell one more legacy SAN or router, and that's really what's exciting us here, as we transform from a hardware to a software-based company. On HPC and AI, as we said, we'll talk about this in a second. We're the fastest-growing supercomputing company on earth. We have aspirations to be the largest supercomputing company on earth, with China and the U.S. vying for number one in that position, it puts us in a good position there. We're going to bridge that into artificial intelligence in our upcoming Shanghai Tech World. The entire day is around AI. In fact, YY has committed $1.2 billion to artificial intelligence over the next few years of R&D to help us bridge that. And then on data center infrastructure, is really about moving to a solutions based infrastructure like our position with SAP HANA, where we've gone deep with engineers on site at SAP, SAP running their own infrastructure on Lenovo and building that out beyond just SAP to other solutions in the marketplace. Overall, significantly expanding our services portfolio to maintain our number one customer satisfaction rating. So given ISC, or International Supercomputing, this week in Frankfurt, and a lot of my team are actually over there, I wanted to just show you the transformation we've had at Lenovo for delivering some of the technology to solve some of the most challenging humanitarian problems on earth. Today, we are the fastest-growing supercomputer company on the planet in terms of number of systems on the Top 500 list. We've gone from zero to 92 positions in just a few short years, but IDC also positions Lenovo as the fast-growing supercomputer and HPC company overall at about 17% year on year growth overall, including all of the broad channel, the regional universities and this kind of thing, so this is an exciting place for us. I'm excited today that Sergi has come all the way from Spain to be with us today. It's an exciting time because this week we announce the fastest next-generation Intel supercomputer on the planet at Barcelona Supercomputer. Before I bring Sergi on stage, let's run a video and I'll show you why we're excited about the capabilities of these next-generation supercomputers. Run the video please. >> Narrator: Different creates one of the most powerful supercomputers for the Barcelona Supercomputer Center. A high-performance, high-capacity design to help shape tomorrow's world. Different designs what's best for you, with 25 years of end-to-end expertise delivering large-scale solutions. It integrates easily with technology from industry partners, through deep collaboration with the client to manufacture, test, configure, and install at global scale. Different achieves the impossible. The first of a new series. A more energy-efficient supercomputer yet 10 times more powerful than its predecessor. With over 3,400 Lenovo ThinkSystem servers, each performing over two trillion calculations per second, giving us 11.1 petaflop capacity. Different powers MareNostrum, a supercomputer that will help us better understand cancer, help discover disease-fighting therapies, predict the impact of climate change. MareNostrom 4.0 promises to uncover answers that will help solve humanities greatest challenges. (audience applauds) >> So please help me in welcoming operations director of the Barcelona Supercomputer Center, Sergi Girona. So welcome, and again, congratulations. It's been a big week for both of us. But I think for a long time, if you haven't been to Barcelona, this has been called the world's most beautiful computer because it's in one of the most gorgeous chapels in the world as you can see here. Congratulations, we now are number 13 on the Top500 list and the fastest next-generation Intel computer. >> Thank you very much, and congratulations to you as well. >> So maybe we can just talk a little bit about what you've done over the last few months with us. >> Sure, thank you very much. It is a pleasure for me being invited here to present to you what we've been doing with Lenovo so far and what we are planning to do in the next future. I'm representing here Barcelona Supercomputing Center. I am presenting high-performance computing services to science and industry. How we see these science services has changed the paradigm of science. We are coming from observation. We are coming from observation on the telescopes and the microscopes and the building of infrastructures, but this is not affordable anymore. This is very expensive, so it's not possible, so we need to move to simulations. So we need to understand what's happening in our environment. We need to predict behaviors only going through simulation. So, at BSC, we are devoted to provide services to industry, to science, but also we are doing our own research because we want to understand. At the same time, we are helping and developing the new engineers of the future on the IT, on HPC. So we are having four departments based on different topics. The main and big one is wiling to understand how we are doing the next supercomputers from the programming level to the performance to the EIA, so all these things, but we are having also interest on what about the climate change, what's the air quality that we are having in our cities. What is the precision medicine we need to have. How we can see that the different drugs are better for different individuals, for different humans, and of course we have an energy department, taking care of understanding what's the better optimization for a cold, how we can save energy running simulations on different topics. But, of course, the topic of today is not my research, but it's the systems we are building in Barcelona. So this is what we have been building in Barcelona so far. From left to right, you have the preparation of the facility because this is 160 square meters with 1.4 megabytes, so that means we need new piping, we need new electricity, at the same time in the center we have to install the core services of the system, so the management practices, and then on the right-hand side you have installation of the networking, the Omni-Path by Intel. Because all of the new racks have to be fully integrated and they need to come into operation rapidly. So we start deployment of the system May 15, and we've now been ending and coming in production July first. All the systems, all the (mumbles) systems from Lenovo are coming before being open and available. What we've been installing here in Barcelona is general purpose systems for our general workload of the system with 3,456 nodes. Everyone of those having 48 cores, 96 gigabytes main memory for a total capacity of about 400 terabytes memory. The objective of this is that we want to, all the system, all the processors, to work together for a single execution for running altogether, so this is an example of the platinum processors from Intel having 24 cores each. Of course, for doing this together with all the cores in the same application, we need a high-speed network, so this is Omni-Path, and of course all these cables are connecting all the nodes. Noncontention, working together, cooperating. Of course, this is a bunch of cables. They need to be properly aligned in switches. So here you have the complete presentation. Of course, this is general purpose, but we wanted to invest with our partners. We want to understand what the supercomputers we wanted to install in 2020, (mumbles) Exascale. We want to find out, we are installing as well systems with different capacities with KNH, with power, with ARM processors. We want to leverage our obligations for the future. We want to make sure that in 2020 we are ready to move our users rapidly to the new technologies. Of course, this is in total, giving us a total capacity of 13.7 petaflops that it's 12 times the capacity of the former MareNostrum four years ago. We need to provide the services to our scientists because they are helping to solve problems for humanity. That's the place we are going to go. Last is inviting you to come to Barcelona to see our place and our chapel. Thank you very much (audience applauds). >> Thank you. So now you can all go home to your spouses and significant others and say you have a formal invitation to Barcelona, Spain. So last, I want to talk about what we've done to transform Lenovo. I think we all know the history is nice but without execution, none of this is going to be possible going forward, so we have been very very busy over the last six months to a year of transforming Lenovo's data center organization. First, we moved to a dedicated end-to-end sales and marketing organization. In the past, we had people that were shared between PC and data center, now thousands of sales people around the world are 100% dedicated end to end to our data center clients. We've moved to a fully integrated and dedicated supply chain and procurement organization. A fully dedicated quality organization, 100% dedicated to expanding our data center success. We've moved to a customer-centric segment, again, bringing in significant new leaders from outside the company to look end to end at each of these segments, supercomputing being very very different than small business, being very very different than taking care of, for example, a large retailer or bank. So around hyperscale, software-defined infrastructure, HPC, AI, and supercomputing and data center solutions-led infrastructure. We've built out a whole new set of global channel programs. Last year, or a year passed, we have five different channel programs around the world. We've now got one simplified channel program for dealer registration. I think our channel is very very energized to go out to market with Lenovo technology across the board, and a whole new set of system integrator relationships. You're going to hear from one of them in Christian's discussion, but a whole new set of partnerships to build solutions together with our system integrative partners. And, again, as I mentioned, a brand new leadership team. So look forward to talking about the details of this. There's been a significant amount of transformation internal to Lenovo that's led to the success of this new product introduction today. So in conclusion, I want to talk about the news of the day. We are transforming Lenovo to the next phase of our data center growth. Again, in over 160 countries, closing on that first phase of transformation and moving forward with some unique declarations. We're launching the largest portfolio in our history, not just in servers but in storage and networking, as everything becomes kind of a software personality on top of x86 Compute. We think we're very well positioned with our scale on PCs as well as data center. Two new brands for both data center infrastructure and Software-Defined, without the legacy shackles of our competitors, enabling us to move very very quickly into Software-Defined, and, again, foreshadowing some joint ventures in M&A that are going to be coming up that will further accelerate ourselves there. New premiere support offerings, enabling you to get direct access to level two engineers and white glove unboxing services, which are going to be bundled along with ThinkAgile. And then celebrating the milestone of 25 years in x86 server compute, not just ThinkPads that you'll hear about shortly, but also our 20 million server shipping next month. So we're celebrating that legacy and looking forward to the next phase. And then making sure we have the execution engine to maintain our position and grow it, being number one in customer satisfaction and number one in quality. So, with that, thank you very much. I look forward to seeing you in the breakouts today and talking with many of you, and I'll bring Rod back up to transition us to the next section. Thank you. (audience applauds) >> All right, Kirk, thank you, sir. All right, ladies and gentlemen, what did you think of that? How about a big round of applause for ThinkAgile, ThinkSystems new brands? (audience applauds) And, obviously, with that comes a big round of applause, for Kirk Skaugen, my boss, so we've got to give him a big round of applause, please. I need to stay employed, it's very important. All right, now you just heard from Kirk about some of the new systems, the brands. How about we have a quick look at the video, which shows us the brand new DCG images. >> Narrator: Legacy thinking is dead, stuck in the past, selling the same old stuff, over and over. So then why does it seem like a data center, you know, that thing powering all our little devices and more or less everything interaction today is still stuck in legacy thinking because it's rigid, inflexible, slow, but that's not us. We don't do legacy. We do different. Because different is fearless. Different reduces Cloud deployment from days to hours. Different creates agile technology that others follow. Different is fluid. It uses water-cooling technology to save energy. It co-innovates with some of the best minds in the industry today. Different is better, smarter. Maybe that's why different already holds so many world-record benchmarks in everything. From virtualization to database and application performance or why it's number one in reliability and customer satisfaction. Legacy sells you what they want. Different builds the data center you need without locking you in. Introducing the Data Center Group at Lenovo. Different... Is better. >> All right, ladies and gentlemen, a big round of applause, once again (mumbles) DCG, fantastic. And I'm sure all of you would agree, and Kirk mentioned it a couple of times there. No legacy means a real consultative approach to our customers, and that's something that we really feel is differentiated for ourselves. We are effectively now one of the largest startups in the DCG space, and we are very much ready to disrupt. Now, here in New York City, obviously, the heart of the fashion industry, and much like fashion, as I mentioned earlier, we're different, we're disruptive, we're agile, smarter, and faster. I'd like to say that about myself, but, unfortunately, I can't. But those of you who have observed, you may have noticed that I, too, have transformed. I don't know if anyone saw that. I've transformed from the pinstripe blue, white shirt, red tie look of the, shall we say, our predecessors who owned the x86 business to now a very Lenovo look. No tie and consequently a little bit more chic New York sort of fashion look, shall I say. Nothing more than that. So anyway, a bit of a transformation. It takes a lot to get to this look, by the way. It's a lot of effort. Our next speaker, Christian Teismann, is going to talk a lot about the core business of Lenovo, which really has been, as we've mentioned today, our ThinkPad, 25-year anniversary this year. It's going to be a great celebration inside Lenovo, and as we get through the year and we get closer and closer to the day, you'll see a lot more social and digital work that engages our customers, partners, analysts, et cetera, when we get close to that birthday. Customers just generally are a lot tougher on computers. We know they are. Whether you hang onto it between meetings from the corner of the Notebook, and that's why we have magnesium chassis inside the box or whether you're just dropping it or hypothetically doing anything else like that. We do a lot of robust testing on these products, and that's why it's the number one branded Notebook in the world. So Christian talks a lot about this, but I thought instead of having him talk, I might just do a little impromptu jump back stage and I'll show you exactly what I'm talking about. So follow me for a second. I'm going to jaunt this way. I know a lot of you would have seen, obviously, the front of house here, what we call the front of house. Lots of videos, et cetera, but I don't think many of you would have seen the back of house here, so I'm going to jump through the back here. Hang on one second. You'll see us when we get here. Okay, let's see what's going on back stage right now. You can see one of the team here in the back stage is obviously working on their keyboard. Fantastic, let me tell you, this is one of the key value props of this product, obviously still working, lots of coffee all over it, spill-proof keyboard, one of the key value propositions and why this is the number one laptop brand in the world. Congratulations there, well done for that. Obviously, we test these things. Height, distances, Mil-SPEC approved, once again, fantastic product, pick that up, lovely. Absolutely resistant to any height or drops, once again, in line with our Mil-SPEC. This is Charles, our producer and director back stage for the absolute event. You can see, once again, sand, coincidentally, in Manhattan, who would have thought a snow storm was occurring here, but you can throw sand. We test these things for all of the elements. I've obviously been pretty keen on our development solutions, having lived in Japan for 12 years. We had this originally designed in 1992 by (mumbles), he's still our chief development officer still today, fantastic, congratulations, a sand-enhanced notebook, he'd love that. All right, let's get back out front and on with the show. Watch the coffee. All right, how was that? Not too bad (laughs). It wasn't very impromptu at all, was it? Not at all a set up (giggles). How many people have events and have a bag of sand sitting on the floor right next to a Notebook? I don't know. All right, now it's time, obviously, to introduce our next speaker, ladies and gentlemen, and I hope I didn't steal his thunder, obviously, in my conversations just now that you saw back stage. He's one of my best friends in Lenovo and easily is a great representative of our legendary PC products and solutions that we're putting together for all of our customers right now, and having been an ex-Pat with Lenovo in New York really calls this his second home and is continually fighting with me over the fact that he believes New York has better sushi than Tokyo, let's welcome please, Christian Teismann, our SVP, Commercial Business Segment, and PC Smart Office. Christian Teismann, come on up mate. (audience applauds) >> So Rod thank you very much for this wonderful introduction. I'm not sure how much there is to add to what you have seen already back stage, but I think there is a 25-year of history I will touch a little bit on, but also a very big transformation. But first of all, welcome to New York. As Rod said, it's my second home, but it's also a very important place for the ThinkPad, and I will come back to this later. The ThinkPad is thee industry standard of business computing. It's an industry icon. We are celebrating 25 years this year like no other PC brand has done before. But this story today is not looking back only. It's a story looking forward about the future of PC, and we see a transformation from PCs to personalized computing. I am privileged to lead the commercial PC and Smart device business for Lenovo, but much more important beyond product, I also am responsible for customer experience. And this is what really matters on an ongoing basis. But allow me to stay a little bit longer with our iconic ThinkPad and history of the last 25 years. ThinkPad has always stand for two things, and it always will be. Highest quality in the industry and technology innovation leadership that matters. That matters for you and that matters for your end users. So, now let me step back a little bit in time. As Rod was showing you, as only Rod can do, reliability is a very important part of ThinkPad story. ThinkPads have been used everywhere and done everything. They have survived fires and extreme weather, and they keep surviving your end users. For 25 years, they have been built for real business. ThinkPad also has a legacy of first innovation. There are so many firsts over the last 25 years, we could spend an hour talking about them. But I just want to cover a couple of the most important milestones. First of all, the ThinkPad 1992 has been developed and invented in Japan on the base design of a Bento box. It was designed by the famous industrial designer, Richard Sapper. Did you also know that the ThinkPad was the first commercial Notebook flying into space? In '93, we traveled with the space shuttle the first time. For two decades, ThinkPads were on every single mission. Did you know that the ThinkPad Butterfly, the iconic ThinkPad that opens the keyboard to its size, is the first and only computer showcased in the permanent collection of the Museum of Modern Art, right here in New York City? Ten years later, in 2005, IBM passed the torch to Lenovo, and the story got even better. Over the last 12 years, we sold over 100 million ThinkPads, four times the amount IBM sold in the same time. Many customers were concerned at that time, but since then, the ThinkPad has remained the best business Notebook in the industry, with even better quality, but most important, we kept innovating. In 2012, we unveiled the X1 Carbon. It was the thinnest, lightest, and still most robust business PC in the world. Using advanced composited materials like a Formula One car, for super strengths, X1 Carbon has become our ThinkPad flagship since then. We've added an X1 Carbon Yoga, a 360-degree convertible. An X1 Carbon tablet, a detachable, and many new products to come in the future. Over the last few years, many new firsts have been focused on providing the best end-user experience. The first dual-screen mobile workstation. The first Windows business tablet, and the first business PC with OLED screen technology. History is important, but a massive transformation is on the way. Future success requires us to think beyond the box. Think beyond hardware, think beyond notebooks and desktops, and to think about the future of personalized computing. Now, why is this happening? Well, because the business world is rapidly changing. Looking back on history that YY gave, and the acceleration of innovation and how it changes our everyday life in business and in personal is driving a massive change also to our industry. Most important because you are changing faster than ever before. Human capital is your most important asset. In today's generation, they want to have freedom of choice. They want to have a product that is tailored to their specific needs, every single day, every single minute, when they use it. But also IT is changing. The Cloud, constant connectivity, 5G will change everything. Artificial intelligence is adding things to the capability of an infrastructure that we just are starting to imagine. Let me talk about the workforce first because it's the most important part of what drives this. The millennials will comprise more than half of the world's workforce in 2020, three years from now. Already, one out of three millennials is prioritizing mobile work environment over salary, and for nearly 60% of all new hires in the United States, technology is a very important factor for their job search in terms of the way they work and the way they are empowered. This new generation of new employees has grown up with PCs, with Smart phones, with tablets, with touch, for their personal use and for their occupation use. They want freedom. Second, the workplace is transforming. The video you see here in the background. This is our North America headquarters in Raleigh, where we have a brand new Smart workspace. We have transformed this to attract the new generation of workers. It has fewer traditional workspaces, much more meaning and collaborative spaces, and Lenovo, like many companies, is seeing workspaces getting smaller. An average workspace per employee has decreased by 30% over the last five years. Employees are increasingly mobile, but, if they come to the office, they want to collaborate with their colleagues. The way we collaborate and communicate is changing. Investment in new collaboration technology is exploding. The market of collaboration technology is exceeding the market of personal computing today. It will grow in the future. Conference rooms are being re-imagined from a ratio of 50 employees to one large conference room. Today, we are moving into scenarios of four employees to one conference room, and these are huddle rooms, pioneer spaces. Technology is everywhere. Video, mega-screens, audio, electronic whiteboards. Adaptive technologies are popping up and change the way we work. As YY said earlier, the pace of the revolution is astonishing. So personalized computing will transform the PC we all know. There's a couple of key factors that we are integrating in our next generations of PC as we go forward. The most important trends that we see. First of all, choose your own device. We talked about this new generation of workforce. Employees who are used to choosing their own device. We have to respond and offer devices that are tailored to each end user's needs without adding complexity to how we operate them. PC is a service. Corporations increasingly are looking for on-demand computing in data center as well as in personal computing. Customers want flexibility. A tailored management solution and a services portfolio that completes the lifecycle of the device. Agile IT, even more important, corporations want to run an infrastructure that is agile, instant respond to their end-customer needs, that is self provisioning, self diagnostic, and remote software repair. Artificial intelligence. Think about artificial intelligence for you personally as your personal assistant. A personal assistant which does understand you, your schedule, your travel, your next task, an extension of yourself. We believe the PC will be the center of this mobile device universe. Mobile device synergy. Each of you have two devices or more with you. They need to work together across different operating systems, across different platforms. We believe Lenovo is uniquely positioned as the only company who has a Smart phone business, a PC business, and an infrastructure business to really seamlessly integrate all of these devices for simplicity and for efficiency. Augmented reality. We believe augmented reality will drive significantly productivity improvements in commercial business. The core will be to understand industry-specific solutions. New processes, new business challenges, to improve things like customer service and sales. Security will remain the foundation for personalized computing. Without security, without trust in the device integrity, this will not happen. One of the most important trends, I believe, is that the PC will transform, is always connected, and always on, like a Smart phone. Regardless if it's open, if it's closed, if you carry it, or if you work with it, it always is capable to respond to you and to work with you. 5G is becoming a reality, and the data capacity that will be out there is by far exceeding today's traffic imagination. Finally, Smart Office, delivering flexible and collaborative work environments regardless on where the worker sits, fully integrated and leverages all the technologies we just talked before. These are the main challenges you and all of your CIO and CTO colleagues have to face today. A changing workforce and a new set of technologies that are transforming PC into personalized computing. Let me give you a real example of a challenge. DXC was just formed by merging CSE company and HP's Enterprise services for the largest independent services company in the world. DXC is now a 25 billion IT services leader with more than 170,000 employees. The most important capital. 6,000 clients and eight million managed devices. I'd like to welcome their CIO, who has one of the most challenging workforce transformation in front of him. Erich Windmuller, please give him a round of applause. (audience applauds). >> Thank you Christian. >> Thank you. >> It's my pleasure to be here, thank you. >> So first of all, let me congratulation you to this very special time. By forming a new multi-billion-dollar enterprise, this new venture. I think it has been so far fantastically received by analysts, by the press, by customers, and we are delighted to be one of your strategic partners, and clearly we are collaborating around workforce transformation between our two companies. But let me ask you a couple of more personal questions. So by bringing these two companies together with nearly 200,00 employees, what are the first actions you are taking to make this a success, and what are your biggest challenges? >> Well, first, again, let me thank you for inviting me and for DXC Technology to be a part of this very very special event with Lenovo, so thank you. As many of you might expect, it's been a bit of a challenge over the past several months. My goal was really very simple. It was to make sure that we brought two companies together, and they could operate as one. We need to make sure that could continue to support our clients. We certainly need to make sure we could continue to sell, our sellers could sell. That we could pay our employees, that we could hire people, we could do all the basic foundational things that you might expect a company would want to do, but we really focused on three simple areas. I called it the three Cs. Connectivity, communicate, and collaborate. So we wanted to make sure that we connected our legacy data centers so we could transfer information and communicate back and forth. We certainly wanted to be sure that our employees could communicate via WIFI, whatever locations they may or may not go to. We certainly wanted to, when we talk about communicate, we need to be sure that everyone of our employees could send and receive email as a DXC employee. And that we had a single-enterprise directory and people could communicate, gain access to calendars across each of the two legacy companies, and then collaborate was also key. And so we wanted to be sure, again, that people could communicate across each other, that our legacy employees on either side could get access to many of their legacy systems, and, again, we could collaborate together as a single corporation, so it was challenging, but very very, great opportunity for all of us. And, certainly, you might expect cyber and security was a very very important topic. My chairman challenged me that we had to be at least as good as we were before from a cyber perspective, and when you bring two large companies together like that there's clearly an opportunity in this disruptive world so we wanted to be sure that we had a very very strong cyber security posture, of which Lenovo has been very very helpful in our achieving that. >> Thank you, Erich. So what does DXC consider as their critical solutions and technology for workplace transformation, both internally as well as out on the market? >> So workplace transformation, and, again, I've heard a lot of the same kinds of words that I would espouse... It's all about making our employees productive. It's giving the right tools to do their jobs. I, personally, have been focused, and you know this because Lenovo has been a very very big part of this, in working with our, we call it our My Style Workplace, it's an offering team in developing a solution and driving as much functionality as possible down to the workstation. We want to be able, for me, to avoid and eliminate other ancillary costs, audio video costs, telecommunication cost. The platform that we have, the digitized workstation that Lenovo has provided us, has just got a tremendous amount of capability. We want to streamline those solutions, as well, on top of the modern server. The modern platform, as we call it, internally. I'd like to congratulate Kirk and your team that you guys have successfully... Your hardware has been certified on our modern platform, which is a significant accomplishment between our two companies and our partnership. It was really really foundational. Lenovo is a big part of our digital workstation transformation, and you'll continue to be, so it's very very important, and I want you to know that your tools and your products have done a significant job in helping us bring two large corporations together as one. >> Thank you, Erich. Last question, what is your view on device as a service and hardware utility model? >> This is the easy question, right? So who in the room doesn't like PC or device as a service? This is a tremendous opportunity, I think, for all of us. Our corporation, like many of you in the room, we're all driven by the concept of buying devices in an Opex versus a Capex type of a world and be able to pay as you go. I think this is something that all of us would like to procure, product services and products, if you will, personal products, in this type of a mode, so I am very very eager to work with Lenovo to be sure that we bring forth a very dynamic and constructive device as a service approach. So very eager to do that with Lenovo and bring that forward for DXC Technology. >> Erich, thank you very much. It's a great pleasure to work with you, today and going forward on all sides. I think with your new company and our lineup, I think we have great things to come. Thank you very much. >> My pleasure, great pleasure, thank you very much. >> So, what's next for Lenovo PC? We already have the most comprehensive commercial portfolio in the industry. We have put the end user in the core of our portfolio to finish and going forward. Ultra mobile users, like consultants, analysts, sales and service. Heavy compute users like engineers and designers. Industry users, increasingly more understanding. Industry-specific use cases like education, healthcare, or banking. So, there are a few exciting things we have to announce today. Obviously, we don't have that broad of an announcement like our colleagues from the data center side, but there is one thing that I have that actually... Thank you Rod... Looks like a Bento box, but it's not a ThinkPad. It's a first of it's kind. It's the world's smallest professional workstation. It has the power of a tower in the Bento box. It has the newest Intel core architecture, and it's designed for a wide range of heavy duty workload. Innovation continues, not only in the ThinkPad but also in the desktops and workstations. Second, you hear much about Smart Office and workspace transformation today. I'm excited to announce that we have made a strategic decision to expand our Think portfolio into Smart Office, and we will soon have solutions on the table in conference rooms, working with strategic partners like Intel and like Microsoft. We are focused on a set of devices and a software architecture that, as an IoT architecture, unifies the management of Smart Office. We want to move fast, so our target is that we will have our first product already later this year. More to come. And finally, what gets me most excited is the upcoming 25 anniversary in October. Actually, if you go to Japan, there are many ThinkPad lovers. Actually beyond lovers, enthusiasts, who are collectors. We've been consistently asked in blogs and forums about a special anniversary edition, so let me offer you a first glimpse what we will announce in October, of something we are bring to market later this year. For the anniversary, we will introduce a limited edition product. This will include throwback features from ThinkPad's history as well as the best and most powerful features of the ThinkPad today. But we are not just making incremental adjustments to the Think product line. We are rethinking ThinkPad of the future. Well, here is what I would call a concept card. Maybe a ThinkPad without a hinge. Maybe one you can fold. What do you think? (audience applauds) but this is more than just design or look and feel. It's a new set of advanced materials and new screen technologies. It's how you can speak to it or write on it or how it speaks to you. Always connected, always on, and can communicate on multiple inputs and outputs. It will anticipate your next meeting, your next travel, your next task. And when you put it all together, it's just another part of the story, which we call personalized computing. Thank you very much. (audience applauds) Thank you, sir. >> Good on ya, mate. All right, ladies and gentlemen. We are now at the conclusion of the day, for this session anyway. I'm going to talk a little bit more about our breakouts and our demo rooms next door. But how about the power with no tower, from Christian, huh? Big round of applause. (audience applauds) And what about the concept card, the ThinkPad? Pretty good, huh? I love that as well. I tell you, it was almost like Leonardo DiCaprio was up on stage at one stage. He put that big ThinkPad concept up, and everyone's phones went straight up and took a photo, the whole audience, so let's be very selective on how we distribute that. I'm sure it's already on Twitter. I'll check it out in a second. So once again, ThinkPad brand is a core part of the organization, and together both DCG and PCSD, what we call PCSD, which is our client side of the business and Smart device side of the business, are obviously very very linked in transforming Lenovo for the future. We want to also transform the industry, obviously, and transform the way that all of us do business. Lenovo, if you look at basically a summary of the day, we are highly committed to being a top three data center provider. That is really important for us. We are the largest and fastest growing supercomputing company in the world, and Kirk actually mentioned earlier on, committed to being number one by 2020. So Madhu who is in Frankfurt at the International Supercomputing Convention, if you're watching, congratulations, your targets have gone up. There's no doubt he's going to have a lot of work to do. We're obviously very very committed to disrupting the data center. That's obviously really important for us. As we mentioned, with both the brands, the ThinkSystem, and our ThinkAgile brands now, highly focused on disrupting and ensuring that we do things differently because different is better. Thank you to our customers, our partners, media, analysts, and of course, once again, all of our employees who have been on this journey with us over the last two years that's really culminating today in the launch of all of our new products and our profile and our portfolio. It's really thanks to all of you that once again on your feedback we've been able to get to this day. And now really our journey truly begins in ensuring we are disrupting and enduring that we are bringing more value to our customers without that legacy that Kirk mentioned earlier on is really an advantage for us as we really are that large startup from a company perspective. It's an exciting time to be part of Lenovo. It's an exciting time to be associated with Lenovo, and I hope very much all of you feel that way. So a big round of applause for today, thank you very much. (audience applauds) I need to remind all of you. I don't think I'm going to have too much trouble getting you out there, because I was just looking at Christian on the streaming solutions out in the room out the back there, and there's quite a nice bit of lunch out there as well for those of you who are hungry, so at least there's some good food out there, but I think in reality all of you should be getting up into the demo sessions with our segment general managers because that's really where the rubber hits the road. You've heard from YY, you've heard from Kirk, and you've heard from Christian. All of our general managers and our specialists in our product sets are going to be out there to obviously demonstrate our technology. As we said at the very beginning of this session, this is Transform, obviously the fashion change, hopefully you remember that. Transform, we've all gone through the transformation. It's part of our season of events globally, and our next event obviously is going to be in Tech World in Shanghai on the 20th of July. I hope very much for those of you who are going to attend have a great safe travel over there. We look forward to seeing you. Hope you've had a good morning, and get into the sessions next door so you get to understand the technology. Thank you very much, ladies and gentlemen. (upbeat innovative instrumental)