>>Okay, welcome back everyone. To the cubes coverage of AWS summit, 2022 in San Francisco, California. We're here, live on the floor at the Mosconi south events are back. I'm John fur, your host. Remember AWS summit 2022 in New York city is coming this summer. We'll be there with the live cube there as well. Look for us there, but of course, we're back in action with the cloud and AWS. Our next guest Garrett Miller is the general manager of navigation at Mapbox. I mean, it's been a Amazon customer for a long time, Garrett. Thanks for coming on the cube. >>Yeah. Thanks for having us, John. >>So you guys are in the middle of, I love the whole location base slash we developer integration. We've had many conversations on the cube around how engineers and developers are becoming embedded into the application, whether it's from a security standpoint, biometrics, all kinds of stuff, being built into the app and, and location navigation. That's right. Is huge from cars. Everyone knows their car, car map. That's right. GPS satellites, some space it's complicated. It sounds like it sounds easy, but I know it's hard. Yeah. You, you get the keynote going on today. Give us a quick update on Mapbox and we'll then we'll talk about the keynote. >>Yeah. You bet John that's right. So as you were saying, you know, it really is. It's all about location intelligence. And how does that get embedded into the applications? And to the point you made vehicles that are out there on the roads to today. So we target developers. Those are our key customers, and we've got over three and a half million registered on the platform today. They consume the modules that we build with APIs, SDKs, data sets, and more and more applications to accomplish whatever those location needs might be. >>Why we appreciate you coming on. You are featured keynote by presenter here at summit, which means Amazon thinks you're super important to share. I'll say your customer. So you, I know you've been a customer for a long time as a company, but what was your keynote about what was the main theme? The developers were all here. You got the builders. What was your content? What did you present this morning on the keynote? Yeah, >>Well, this morning we really talked a lot about logistics and the, this story that we told was know in the logistics industry, there is a massive movement to shorter and shorter delivery windows. And so the, the, the story that we told is really around a 10 minute delivery. Now, have you ever wondered how you get a 10 minute delivery? You, you place an order on your phone and all of a sudden somebody shows up at your front doorstep. You ever wonder about that? >><laugh> >>Some shows supply >>Chain. Someone's waiting in the wings from my call. >>Yeah. >>Yeah. Well, that's right. >>John's about to order sometime soon. That's right. You ready? That's right. Do all these assets. That's >>Right. They're all ready for you. But there's actually a tremendous amount that actually goes into that. And so it really starts with designing the right distribution system up front. And so we've got tools and, and applications and, and APIs that support that. And really it, every single step of the way, location is a critical aspect to making that delivery happen and getting it to a customer's doorstep in 10 minutes or less. And so how are you understanding the real time road graph that underlies a, a, a driver going from perhaps a dark store, dark kitchen to getting in, excuse me, in front of a customer in 10 minutes with hot food. >>I mean, this is a big point. I was just joking about waiting for me, you know, that, but the point is, is that it's not obvious, but it sounds really hard. I know it's hard because to have that delivery, a lot of things have to happen. It's not just knowing location. >>That's exactly >>Right. So can you just UN pull appeal back the covers on that? What's going on there? >>Yeah. So imagine this is, is, it really starts, as I was saying with designing that distribution system and it's putting in place where you might not expect it, it's actually putting in place a retail store, but these aren't any retail stores, right? These are dark stores. These are dark kitchens that are strategically placed as close as possible, the customer density, so that you can actually shorten that window as much as possible to get you whatever that order might be. But from there, it actually goes quite a bit further when an order actually comes in, you've gotta be able to understand how do I sign an, a driver to get that order to the customer in that, in that very short period of time, more often than not, it's getting it to the driver that can get there the fastest, once you've got the right driver identified, how are you actually then going to enable them to get from point a to B to get that order. >>And then perhaps from B to C to get to your front door, being able to do turn by turn navigation that reflects everything. That's how happening in the real world to be able to get there on a timely way is critical. And then wrapping around that actually the, the, the end customer's experience your experience with how are you placing that order? Yeah. How are you using Mapbox services to do that? How are you being able to track on your application and say, well, you know, great, I expect 10 minutes and they're five minutes away. Are you gonna show up our APIs and SDKs power? That experience, >>I wanna get into the product in a second, but you brought up something I think's important to highlight. One is dark kitchens, dark stores. That's right. Okay. Term people may or may not have heard of, we all have experience in COVID going to our favorite restaurant, which has been kind of downsized because of the COVID and we're waiting for our food. And someone comes in from another delivery ever standing in line next was just pick something up. I mean, they're going through the front door. That's like the, the, the branded store. So, so is it right to say that dark kitchens are essentially replicas of the store to minimize that traffic, but, but also to be efficient for something else that's right. >>It actually even goes further than that. There are many restaurant brands. Now, it only exists as a brand. They don't have a restaurant that you can go to and sit down and have that meal. They actually only operate dark kitchens to, to serve that demand of people wanting to order up, Hey, I want my food. I want it. Now, those brands exist to serve that need. >>All right. So great for the definition, we just define dark kitchens, dark stores, but also brings, I wanna get your reaction to this before we get into the product, cuz this is a trend that's right. This is not like a one off thing. That's right. It's not a pulled forward TA a market that was COVID enabled. This is actually a user experience inflection point. That's >>Right. >>Can you share your vision on what this means? Because there's mobile ordering, there's the dynamics of the kitchens as a supplier of something in stores. So that's content or a product that's being delivered to a consumer via of the web. So now there's gotta be a whole nother reef factoring of the operating environment. Now that's what's happening is that might get that >>Right? No, that's exactly right. And even if you step back, even further and you, you think about the, the journey that the logistics industry has been on, it used to be that two days was that really exciting delivery time. Right. And everybody got it super excited. Then it became next day. Then it became same day and now it's become 10 minutes. And even some companies are out there offering seven minute deliveries, right. And in order to do that, you've gotta completely retool your business. So you can think the logistics and industry really existing on two continuums, you've got pre-planned deliveries on one hand and on-demand deliveries on the other. And there are two parallel distribution systems and ecosystems and industries really springing up to serve those different types of demand. >>So you've been on Amazon web services customer for how many years, >>Since 2013 in our founding. And you know, actually we're really proud to say that we were born on Amazon and we have scaled on Amazon. >>How are they helping you scale? What are they doing to help you? >>Well, I'd say just about everything. And if you think about their, the, the services that Amazon provides for us, they power every single step of our business along the way. And so I'll give you an example. We can walk through that with some of the tech technology. I, if you think about again, how do you get 10 minutes? You gotta have a pretty precise understanding of what's going on in the real world. And so to do that, it, for us, it all starts with collecting billions and billions of data points from sensors that are out there in the world. We stream that into our technology stack, starting at the very beginning with Amazon ESIS. And so that's just the start. But then that feeds into our entire technology stack that all runs on site on top of AWS, to where we're running our own AI models that we use Amazon SageMaker to make, and then stream it back out to our AP, through our APIs, to our se Ks and applications that sit on the edge again, all leveraging Amazon technology. >>Well, I think this is a great use case and I'll get back into the, the Mapbox a second, but Amazon, you guys are executing what I call the super cloud vision, which is snowflake you guys building on their CapX leverage. You're building a super cloud on your own. It's your app, it's your cloud. >>That's right. That's right. So if you, again, if you think about it, you know, and actually just stepping back for a moment, tell about Mapbox for a second is what, what Mapbox can do is provide the most accurate digital representation of the physical world. Think about the Mapbox technology, delivering the most accurate digital twin of mother earth, right? That's what we do. And the way that we do that is to consume, as I said earlier, vast amounts of data, we've got powerful AI that structures that data, and then really robust and scalable infrastructure that underpins all of that. Now the benefit of working with a company like AWS is that they take care of that third point. Yeah. Which means we get to go focus on the first two, which is how we differentiate and build our >>Business. And that's exactly the model of how you win in the cloud. In my opinion, that's the go big piece, the go and there's tools that fit in white spaces. But that's the, I think that's the right formula. Let's get back to Mac boxer. I know you've got news. You got the, the, uh, Mapbox fleet SDK. You announced, I wanna hold on that we'll get to in a second, let's get back to what you got are providing that example as you have this new operating environment of how delivery and, and supply chain and that's example, I want to know how tech your technology is making all that work. Because I was just talking to someone last night about this web van was web 1.0 and crash never was successful. Instacart is kind of hurting. So maybe they're optimized. You could save them. I mean, cuz the economics gotta work. If you don't have the underlying system built, that might fail. So there'll be probably the third version that gets it. Right. Maybe at Mapbox again, I'm speculating, but I'll let you talk. Yeah. How does Mapbox solve the, that problem? >>You know, it's interesting if you come back to that, that, that analogy we're using with AWS and how do you use AWS to win in the cloud? It's the same story for Mapbox of how do you win in the location industry? And what we do is provide those same tool sets of APIs and SDKs, the thing go power, those logistics companies like an Instacart, who's a great customer of ours to run in their logistics business on top of it again, it's all about how do you provide technology that allows your customers yeah. To focus on what matters from a differentiation perspective as they focus on building their >>Business and you think your economics is gonna enable these people to be successful >>100%. That's >>The goal >>100%. >>All right. So another thing that I wanna bring up is the fleet SDK, what was the, that you announced they can, you just quickly share the news on what this >>Is? Yeah, yeah, absolutely. I appreciate that, John. Yeah. So today on the Eve of earth day, we're very excited to announce Mapbox fleet going into, uh, our beta launch and what Mapbox fleet is, is, uh, a set of tools and application that allows our customers to more efficiently route their vehicles, which means lowering their fuel consumption. And at the same time, more efficiently dispatching those vehicles, which means that you can get more done with fewer assets, essentially. How do you get more packages onto a single vehicle to get those to the customers? Now you may be watching the news and understanding, yeah, there's a tremendous explosion of delivery going. Yeah. And that's fantastic. Right? That's great business for our logistics customers. Good business for us too. What's happening though, is that as those volumes are ballooning, everybody's all of a sudden, really looking at their cost structures and trying to understand how do I manage this? >>Right. I have efficiency targets as a business. Maybe I've been really focused on customer acquisition. Now it's time to flip the model and really understand in the economics of profitable growth. We help with that, with that focus on efficiency, but the double edged sword with growth and, and you know, running a logistics business is that you actually have a tremendous amount of carbon emissions that are associated with that. Yeah. For a car to show up or a truck to show up, to deliver something to your house, their emissions associated with that. So what we find is that we're able to not only drive dollar savings for our customers, but also as part of that, with the efficiency angle, really help to drive down the overall carbon impact in the carbon footprint of what they do. And >>How do you do that? >>Well, it's the efficiency lens, right? So if somebody is driving 20%, fewer miles, they're going to emit 20% fewer. Okay. >>Gotcha. So it's a numbers game across the board with actual measurement. That's exactly right. Built in and say optimization paths, all kinds of navigation. >>That's exactly right. So embedded within Mapbox fleet application are those optimization algorithm. >>So you got a platform that's setting up for the next level delivery system slash new way to connect people to goods and services and other things getting from point a to point B, you got the sustainability check you're in the cloud, born in the cloud cloud scale. I gotta a, I can't go without asking if you're on Amazon, you do all this cool stuff. There's gotta be a machine learning an AI angle. So what is that? Yeah, absolutely. >>Absolutely. AB yeah. You know, <laugh> guilty as charged. >>I would say >>John. Uh, so look, I >>Think, I mean AI and, and sustainability are gonna be, I think filings in my, in the future we be talking about on the cube, if you're not an AI company or, and doing force for good stuff, I think there's gonna be mandatory requirements on those. >>I couldn't three more. I think the ESG agenda is an incredibly important one. One that's core to Mapbox has been since the founding of the company back in 2013. Uh, but if you look at how does AI and ML fit into Mapbox, it does that in a number of different ways. And really when we come back to this idea of Mapbox creating a digital twin of the earth, the way that we do that, it is through ingesting a tremendous amount of sensor data. Right? You can imagine, uh, Mapbox customers on any given week drive, billions of miles, we're capturing all of that telemetry data to understand and make sense of what does that mean for, for, for the world that allows us to push in any given day 700,000 updates to our underly, your location technology stack, and at the same time provide insights as to exactly what's happening. Are there roadside incidents? Are there, are there issues with traffic? So by collecting all of that data, we run incredibly powerful AI models on top of it that allow us to create the, the real world representation of what's happening. That's exactly how >>It works. What, what, as they say in the, um, big data AI world is you guys have a tremendous observation space. You're looking at a lot of surface area data that's exactly right. Across multiple workloads and apps. That's >>Exactly >>Right. You can connect those dots with the right AI. >>That's exactly right. That's exactly right. And I think I, you know, coming back to your point around sustainability, I do think that the AI and ML capabilities that are being delivered are going to be paramount to that. It being such a fundamental aspect to what am, to what Mapbox does as a business allows us to launch these game changing solutions like Mapbox fleet and staying on that, that kind of environmental and sustainable kick for a second. Just last week, we launched our, our EV routing API that powers the next generation of EVs. So AI ML sustainability. If it's not core business today, it's gotta very quickly become core. >>It's really interesting. I really think what we're teasing out here and it's fun to talk about it now because we'll look back at it later 10 years or more and say, wow, this is completely refactored the industry and lives and the planet ultimately. Right. So this is a, a kind of got force for good built into the system natively. That's >>Right. That's >>That's interesting, Garrett, thanks so much for sharing the story. Give you the last word, share with the audience, what you guys are up to, what you're promoting, what you're looking for. Are you hiring, uh, is there a call to action? You wanna share? Give the plug for the company? Yeah, >>Absolutely hiring like crazy come join Mapbox and BU build the future of geolocation and intelligent location services with us. Uh, the, thanks so much for the time, >>John. Thanks for coming on cube coverage here in San Francisco, California Mosconi center back at live events. I'm John for host cube stayed with us as day two wraps down. Remember New York city. This summer will be there as well. Cube coverage of more cloud coverage events are back. Thanks for watching.

>> live from San Francisco, California. It's the Q covering the IBM Chief Data Officer Summit brought to you by IBM. >> Welcome back to Fisherman's Fisherman's Wharf in San Francisco. Everybody, my name is David wanted. You're watching the Cube, the leader in live tech coverage, you ought to events. We extract the signal from the noise. We're here. The IBM CDO event. This is the 10th anniversary of this event. Caitlin Hallford is here. She's the director of a I Accelerator and client success at IBM. Caitlin, great to see you again. Wow. 10 years. Amazing. They and Carlo Apple Apple Glace e is here. Who is the program director for data and a I at IBM. Because you again, my friend. Thanks for coming on to Cuba. Lums. Wow, this is 10 years, and I think the Cube is covered. Probably eight of these now. Yeah, kind of. We bounce between San Francisco and Boston to great places for CEOs. Good places to have intimate events, but and you're taking it global. I understand. Congratulations. Congratulations on the promotion. Thank you. Going. Thank you so much. >> So we, as you know well are well, no. We started our chief date officer summits in San Francisco here, and it's gone 2014. So this is our 10th 1 We do two a year. We found we really have a unique cohort of clients. The join us about 100 40 in San Francisco on the spring 140 in Boston in the fall, and we're here celebrating the 10th 10 Summit. >> So, Carlo, talk about your role and then let's get into how you guys, you know, work together. How you hand the baton way we'll get to the client piece. >> So I lead the Data Center League team, which is a group within our product development, working side by side with clients really to understand their needs as well developed, use cases on our platform and tools and make sure we are able to deliver on those. And then we work closely with the CDO team, the global CEO team on best practices, what patterns they're seeing from an architecture perspective. Make sure that our platforms really incorporating that stuff. >> And if I recall the data science that lead team is its presales correct and could >> be posted that it could, it really depends on the client, so it could be prior to them buying software or after they bought the software. If they need the help, we can also come in. >> Okay, so? So it can be a for pay service. Is that correct or Yeah, we can >> before pay. Or sometimes we do it based on just our relation with >> It's kind of a mixed then. Right? Okay, so you're learning the client's learning, so they're obviously good, good customers. And so you want to treat him right >> now? How do you guys work >> together? Maybe Caitlin, you can explain. The two organizations >> were often the early testers, early adopters of some of the capabilities. And so what we'll do is we'll test will literally will prove it out of skill internally using IBM itself as an example. And then, as we build out the capability, work with Carlo and his team to really drive that in a product and drive that into market, and we share a lot of client relationships where CEOs come to us, they're want advice and counsel on best practices across the organization. And they're looking for latest applications to deploy deploy known environments and so we can capture a lot of that feedback in some of the market user testing proved that out. Using IBM is an example and then work with you to really commercialized and bring it to market in the most efficient manner. >> You were talking this morning. You had a picture up of the first CDO event. No Internet, no wife in the basement. I love it. So how is this evolved from a theme standpoint? What do you What are the patterns? Sure. So when >> we started this, it was really a response. Thio primarily financial service is sector regulatory requirements, trying to get data right to meet those regulatory compliance initiatives. Defensive posture certainly weren't driving transformation within their enterprises. And what I've seen is a couple of those core elements are still key for us or data governance and data management. And some of those security access controls are always going to be important. But we're finding his videos more and more, have expanded scope of responsibilities with the enterprise they're looked at as a leader. They're no longer sitting within a c i o function there either appear or, you know, working in partnership with, and they're driving enterprise wide, you know, initiatives for the for their enterprises and organizations, which has been great to see. >> So we all remember when you know how very and declared data science was gonna be the number one job, and it actually kind of has become. I think I saw somewhere, maybe in Glass door was anointed that the top job, which is >> kind of cool to see. So what are you seeing >> with customers, Carlo? You guys, you have these these blueprints, you're now applying them, accelerating different industries. You mentioned health care this morning. >> What are some >> of those industry accelerators And how is that actually coming to fruition? Yes. >> So some of the things we're seeing is speaking of financial clients way go into a lot of them. We do these one on one engagements, we build them from custom. We co create these engineering solutions, our platform, and we're seeing patterns, patterns around different use cases that are coming up over and over again. And the one thing about data science Aye, aye. It's difficult to develop a solution because everybody's date is different. Everybody's business is different. So what we're trying to do is build these. We can't just build a widget that's going to solve the problem, because then you have to force your data into that, and we're seeing that that doesn't really work. So building a platform for these clients. But these accelerators, which are a set of core code source code notebooks, industry models in terms a CZ wells dashboards that allow them to quickly build out these use cases around a turn or segmentation on dhe. You know some other models we can grab the box provide the models, provide the know how with the source code, as well as a way for them to train them, deploy them and operationalize them in an organization. That's kind of what we're doing. >> You prime the pump >> prime minute pump, we call them there right now, we're doing client in eights for wealth management, and we're doing that, ref SS. And they come right on the box of our cloudpack for data platform. You could quickly click and install button, and in there you'll get the sample data files. You get no books. You get industry terms, your governance capability, as well as deployed dashboards and models. >> So talk more about >> cloudpack for data. What's inside of that brought back the >> data is a collection of micro Service's Andi. It includes a lot of things that we bring to market to help customers with their journey things from like data ingestion collection to all the way Thio, eh? I model development from building your models to deploying them to actually infusing them in your business process with bias detection or integration way have a lot of capability. Part >> of it's actually tooling. It's not just sort of so how to Pdf >> dualism entire platform eso. So the platform itself has everything you need an organization to kind of go from an idea to data ingestion and governance and management all the way to model training, development, deployment into integration into your business process. >> Now Caitlin, in the early days of the CDO, saw CDO emerging in healthcare, financialservices and government. And now it's kind of gone mainstream to the point where we had Mark Clare on who's the head of data neighborhood AstraZeneca. And he said, I'm not taking the CDO title, you know, because I'm all about data enablement and CDO. You know, title has sort of evolved. What have you seen? It's got clearly gone mainstream Yep. What are you seeing? In terms of adoption of that, that role and its impact on organizations, >> So couple of transit has been interesting both domestically and internationally as well. So we're seeing a lot of growth outside of the U. S. So we did our first inaugural summit in Tokyo. In Japan, there's a number of day leaders in Japan that are really eager to jump start their transformation initiatives. Also did our first Dubai summit. Middle East and Africa will be in South Africa next month at another studio summit. And what I'm seeing is outside of North America a lot of activity and interest in creating an enabling studio light capability. Data Leader, Like, um, and some of these guys, I think we're gonna leapfrog ahead. I think they're going to just absolutely jump jump ahead and in parallel, those traditional industries, you know, there's a new federal legislation coming down by year end for most federal agencies to appoint a chief data officer. So, you know, Washington, D. C. Is is hopping right now, we're getting a number of agencies requesting advice and counsel on how to set up the office how to be successful I think there's some great opportunity in those traditional industries and also seeing it, you know, outside the U. S. And cross nontraditional, >> you say >> Jump ahead. You mean jump ahead of where maybe some of the U. S. >> Absolute best? Absolutely. And I'm >> seeing a trend where you know, a lot of CEOs they're moving. They're really closer to the line of business, right? They're moving outside of technology, but they have to be technology savvy. They have a team of engineers and data scientists. So there is really an important role in every organization that I'm seeing for every client I go to. It's a little different, but you're right, it's it's definitely up and coming. Role is very important for especially for digital transformation. >> This is so good. I was gonna say one of the ways they are teens really, partner Well, together, I think is weaken source some of these in terms of enabling that you know, acceleration and leap frog. What are those pain points or use cases in traditional data management space? You know, the metadata. So I think you talk with Steven earlier about how we're doing some automated meditate a generation and really using a i t. O instead of manually having to label and tag that we're able to generate about 85% of our labels internally and drive that into existing product. Carlos using. And our clients are saying, Hey, we're spending, you know, hundreds of millions of dollars and we've got teams of massive teams of people manual work. And so we're able to recognize it, adopts something like that, press internally and then work with you guys >> actually think of every detail developer out there that has to go figure out what this date is. If you have a tool which we're trying to cooperate the platform based on the guidance from the CDO Global CEO team, we can automatically create that metadata are likely ingested and provide into platform so that data scientists can start to get value out >> of it quickly. So we heard Martin Schroeder talked about digital trade and public policy, and he said there were three things free flow of data. Unless it doesn't make sense like personal information prevent data localization mandates, yeah, and then protect algorithms and source code, which is an I P protection thing. So I'm interested in how your customers air Reacting to that framework, I presume the protect the algorithms and source code I p. That's near and dear right? They want to make sure that you're not taking models and then giving it to their competitors. >> Absolutely. And we talk about that every time we go in there and we work on projects. What's the I p? You know, how do we manage this? And you know, what we bring to the table with the accelerators is to help them jump start them right, even though that it's kind of our a p we created, but we give it to them and then what they derive from that when they incorporate their data, which is their i p, and create new models, that is then their i. P. So those air complicated questions and every company is a little different on what they're worried about with that, so but many banks, we give them all the I P to make sure that they're comfortable and especially in financial service is but some other spaces. It's very competitive. And then I was worried about it because it's, ah, known space. A lot of the algorithm for youse are all open source. They're known algorithms, so there's not a lot of problem there. >> It's how you apply them. That's >> exactly right how you apply them in that boundary of what >> is P, What's not. It's kind of >> fuzzy, >> and we encourage our clients a lot of times to drive that for >> the >> organisation, for us, internally, GDP, our readiness, it was occurring to the business unit level functional area. So it was, you know, we weren't where we needed to be in terms of achieving compliance. And we have the CEO office took ownership of that across the business and got it where we needed to be. And so we often encourage our clients to take ownership of something like that and use it as an opportunity to differentiate. >> And I talked about the whole time of clients. Their data is impor onto them. Them training models with that data for some new making new decisions is their unique value. Prop In there, I'd be so so we encourage them to make sure they're aware that don't just tore their data in any can, um, service out there model because they could be giving away their intellectual property, and it's important. Didn't understand that. >> So that's a complicated one. Write the piece and the other two seem to be even tougher. And some regards, like the free flow of data. I could see a lot of governments not wanting the free flow of data, but and the client is in the middle. OK, d'oh. Government is gonna adjudicate. What's that conversation like? The example that he gave was, maybe was interpolate. If it's if it's information about baggage claims, you can you can use the Blockchain and crypt it and then only see the data at the other end. So that was actually, I thought, a good example. Why do you want to restrict that flow of data? But if it's personal information, keep it in country. But how is that conversation going with clients? >> Leo. Those can involve depending on the country, right and where you're at in the industry. >> But some Western countries are strict about that. >> Absolutely. And this is why we've created a platform that allows for data virtualization. We use Cooper nannies and technologies under the covers so that you can manage that in different locations. You could manage it across. Ah, hybrid of data centers or hybrid of public cloud vendors. And it allows you to still have one business application, and you can kind of do some of the separation and even separation of data. So there's there's, there's, there's an approach there, you know. But you gotta do a balance. Balance it. You gotta balance between innovation, digital transformation and how much you wanna, you know, govern so governs important. And then, you know. But for some projects, we may want to just quickly prototype. So there's a balance there, too. >> Well, that data virtualization tech is interesting because it gets the other piece, which was prevent data localization mandates. But if there is a mandate and we know that some countries aren't going to relax that mandate, you have, ah, a technical solution for that >> architecture that will support that. And that's a big investment for us right now. And where we're doing a lot of work in that space. Obviously, with red hat, you saw partnership or acquisition. So that's been >> really Yeah, I heard something about that's important. That's that's that's a big part of Chapter two. Yeah, all right. We'll give you the final world Caitlyn on the spring. I guess it's not spring it. Secondly, this summer, right? CDO event? >> No, it's been agreed. First day. So we kicked off. Today. We've got a full set of client panel's tomorrow. We've got some announcements around our meta data that I mentioned. Risk insights is a really cool offering. We'll be talking more about. We also have cognitive support. This is another one. Our clients that I really wanted to help with some of their support back in systems. So a lot of exciting announcements, new thought leadership coming out. It's been a great event and looking forward to the next next day. >> Well, I love the fact >> that you guys have have tied data science into the sea. Sweet roll. You guys have done a great job, I think, better than anybody in terms of of, of really advocating for the chief data officer. And this is a great event because it's piers talking. Appears a lot of private conversations going on. So congratulations on all the success and continued success worldwide. >> Thank you so much. Thank you, Dave. >> You welcome. Keep it right there, everybody. We'll be back with our next guest. Ready for this short break. We have a panel coming up. This is David. Dante. You're >> watching the Cube from IBM CDO right back.

>> Live from San Francisco, it's theCUBE. Covering Google Cloud Next 19. Brought to you by Google Cloud and its eco system partners. >> Hello everyone welcome back here to theCUBE live coverage here in San Francisco, California. We're in the Moscone Center on the ground floor here. Day three of three days of coverage for Google Cloud Next 2019. I'm John Furrier, my co-host, Dave Vellante, Stew Miniman out there getting stories out there He's also been hosting. Dave, great to see you! Evren, Director of Product Management at Google Cloud, doing all the data streaming the data. We're streaming data right now. >> Absolutely, this is it. This is it. >> So let's stream some data. So streaming data has certainly been around for awhile. Dave and I when we first started theCUBE ten years ago, it was part of Silk and Angle Media hadoop was just a small little project. That really kind of was the catalyst moment for around big data that's now evolved to it's own position. Now you have streaming data, you have cloud scale, the Cloud has really changed the game on big data. Changed the nature and dynamics of it and one of the things is streaming data, streaming analytics as a core value proposition for enterprises, and this is fairly new. >> Very true. >> What's your take on it and how does it relate to what's going on with Google Cloud? >> I am glad we're talking about that. This is an exciting time for us. Streaming like you said is growing. Batch is not going away, but streaming is actually overtaking a lot of the applications that we're seeing. Today we're seeing more streaming applications taking place than batch. One of the things that we're seeing is everybody is gathering data from all over the place from your websites, from your mobile phones, from your IoT devices, just like we're doing right now. There's data coming in and people want to make decisions real time whether it's in the banking industry, in your healthcare, retail, it doesn't matter which word cycle you're working with and we're seeing how those messages how those events are coming in and where the decisions are being made real time, milliseconds we're talking about. >> Why is it happening, what's the real catalyst here? Just tsunami of data, nature of the value, all of the above, what's the? >> We believe one of the things is like you mentioned Cloud really changed the game. Where people actually can reach globally data and messages at scale. We're talking about billions of messages coming in and processing capacity is available now we can actually process it and make a decision within milliseconds and get to the results. To me, that was the biggest catalyst. And we're seeing many of us have grown up using batch data, making decisions now everybody is talking about M.L. and A.I. You need that data coming in real time and we can actual process it and make the decision. To me, that's the catalyst. >> First of all we love streaming data, this topic. One we believe streaming where shooting video but data, real time, has been one of the keys you see self driving cars monging of data, mixing and matching of data to get better signal and better machine learning and I got to ask you, because batch is certainly the role for batch is kind of old school it's some old techniques it's been around for awhile, >> It's not going to go away though. >> It's not going to go away it's established it's place but the knee jerk reaction of existing old school people who haven't migrated to the new modern version they go to the batch kind of mind set. I want to get you're reaction. Data lakes, there's nothing flowing in a lake. Okay, so there is a role for a data lake streaming gives me the impression of like an ocean or a river or something moving fast. Talk about the differences because it's not just the data lake okay that's a batch kind of reaction. >> It is a complementary. Actually it's not going away because all of that data that we had in the back is something we're relying on to really augment and see what's changing. So if you're in a retail house you're buying something, you're going to make a decision and your support is actually behind it. OK here's Evren, he's actually shopping around this and he wants this for his son. That's what the models built around it is looking at what is my behavior and in the moment making a decision for me. So that's not going away. The other thing is batch users are able to take advantage of the technology today. If you look at our data flow, same set of codes, same set of capability can be used by the same folks that are used to batch. You don't have to change anything so that actually we help folks to be up skilled using the same set of tools and become much more experienced and experts in the streaming too. That's not going away we help both of the worlds. >> So, complementary. >> Very complementary. >> So data lakes are good for kind of setting the table if you have to store it somewhere but that's not the end game though. >> No. >> Okay. >> I wonder if we could talk about the evolution from batch to real time streaming. And my favorite example, because I think people can relate to it, is fraud detection. Ten years ago, it was up to the user to go through his or her bill, right? And then you started to get inundated with false positives, and now lately, last couple of years it's getting better and better. Fewer false positives, usually when you usually no news is good news. News is usually bad news now, so take that example and use that to describe how things have evolved. >> I am a student of AI I did my Master's and PhD in that and I went through that change in my career because we had to collect the data, batch it and analyze it, and actually make a decision about it and we had a lot of false positives and in some cases some negative misses too which you don't want that either. And what happened is our modeling capabilities became much better. With this rich data, and you actually tap into that data lake, you can go in there the data is there, and this is spread data we can pull in data from different sources and actually remove the outliers and make our decision real time right there. We didn't have the processing capability we didn't have a place like PostUp where globic can scan and bring in data at hundreds of gigabytes of data. That's messaging you want to deal with at scale no matter where it is and process that, that wasn't available for us. Now it's available it's like a candy shelf for technologists, all the technology is in our hands and we wanted all these things. >> You were talking about I think the simplicity of, I'm able to use my batch processes and apply them. One of the complaints I hear from developers sometimes is that the data pipeline is getting so complicated. You were talking about you're grabbing stuff from websites, from financial databases, and so depending on what data store you're using and what streaming tools you're using or other A.I. tools, the pipeline gets very complicated the A.P.Is start to get complicated but I'm hearing a story of simplicity. Can you elaborate on that and add some color? >> Yeah I'm glad you're asking that question you may have heard, yesterday we announced a whole bunch of new things and ease of use is the top of the line for us. Really are trying to make it easy. If you look at this eco pipeline we're building with data flow, it helps you end to end. Data engineered no matter which angle their coming in should be able to use their known skill sets and be able to build their pipelines end to end so that you can achieve your goals around streaming. We aren't really having to go through a lot of the clusters of the pipelines we are going to continue to push that ease of use over and over, we're not going to let it go because make it easier, everyone will adapt it faster. >> You mentioned you got a PhD in A.I., Master's in A.I., A.I. has been around for awhile. A lot of people have been saying that but machine learning certainly has changed the game. Machine learning plus cloud has been a real accelerant in the academic and now commercial aspects of A.I. So I want to get your thoughts on the notion of scale which you talk about, plus the diversity of data. So if you can bring in data at scale get more signaling points more access to data signaling the diversity of data becomes very key. But cleanliness, data cleaning, used to be an old practice of you get a bunch of data, stack it up, put it in a pile corpus, and you kind of go clean it. With streaming, if it's always flowing there's kind of a behavioral characteristic of data cleanliness, data monitoring, talk about that diversity of data clean data and how that feeds machine learning and makes better A.I. >> Good one, so that's where we actually are able to, if you look at PostUp, you're building joint your table set of datas with streaming set of datas you can actually put it into data filter it and make those analyses. And within both, we provide enough of a window for you to be able to go back, hey are there things that I should be looking at, up to seven days we can provide a snapshot because you will always find something you can go back, you know what I'm going to remove this outlier. All worrying about all the processing we do before we bring in the data so there's a lot of cleanliness that takes place but we have the built in tools we have the built in capabilities for everyone to get going. It's ready to scale for you from the moment you open it up. That's the beauty of it, that's the beauty of when you start from PostUp to data flow to streaming engine it's ready for you to run. >> Talk about what's changed though when people hear diversity of data they get scared, oh my god I work, heavy lifting. Now it's a benefit. What's easier now to deal with all of these diverse data sets, what's the easy revolution? >> So do you remember the big V's of big data right? Volume, velocity, variety. People were scared about the variety. Now I can actually bring in my data from different places. Again, let's go back to the shopping example. Where I shop, what I shop for, that actually defines my behavior around it. Those data sit somewhere else. We bring those in to make a decision about okay everyone wants to go buy a scooter or whatever else, that's the diversity of the data. We're now able to deal to with this at scale. That was not available we could actually bring in and render this, now everything is going to do this much more sequential. We're now able to bring all of them together process it at the same time and make the decision. >> What's the key products that will make all of those happen, take us through the portfolio if I want that would you just said which is a great value. It sounds like not a heavy lift all I have to do is point the data sources into this engine, what are the products that make up that capability? >> So if I look at the overall portfolio on Google Cloud from our data analysts point of view, so you actually can bring in your data through PostUp, lots of messaging capability globally and you can actually do it regionally because we have a lot of regional requirements coming from various countries and data flow is where we actually transfer the data. That's where you do the processing. And you use all of these advance analytics capabilities through your streaming engine that we released and you have your B query, you have your OMLs, you have all kinds of things that you can bring in you're big tables and what have you. That's all easily integrated end to end for any analyst to be able to use. >> What is beam? >> Beam ah that's great I'm so glad you asked that question I almost forgot! Beam is one of our open sources we donated the same set, just like we did with Koppernes few years ago, we donated to the open source it's growing. This year actually it won The Technology Awards. So the source is open the community really took it upon, they use that toolkit to build their pipelines you can use any kind of a code that you want Java, Gold, whatever you want to do it and they contribute. We use it internally and externally. It's one of those things that's going to grow. We have a lot of community events coming up this year. We might, and I've seen the increase, I'm really really proud of that community. >> Evren, I love the A.I. can't get my mind off your background and academic because I studied A.I. as well in the 80s and 90s all that good stuff. Young kids are flocking to computer science now because A.I. is very sexy, it's very intoxicating and it's so easy to deal with now. You guys had a hack-a-thon here with NCAA using data really kind of real time and kind of cool things are happening. So it's a moment now for A.I. this is the moment. What's your advice, you've been through the wars you've done your chore duty all those years now it's actually happening. What's your advice for young people who want to come in, get their hands dirty, build things, use A.I., what's your advice, how they should tackle that? >> I am living it, both of my sons one is finishing junior high, the other one is a senior in high school, their both in it. So when I hear my young kids come and say, "hey bubba we just built this using transfer flow." Like it is making me really proud. At the middle school level they were doing it. So the good news is we have all of this publicly available data for them. I encourage every one of them. If you look at what we provide from Google Cloud, you come in there, we have the data for them, we have the tools for them, it's all ready for them to play so schools get free access to it too. >> It's a major culture but how do they get someone who's interested but never coded before, how do they jump right in and get ingratiated and immersed into the code, what do they do? >> We have some community reaches that we're actually doing as Google. We go out to them and we're actually establishing centers to really build community events for them to really learn some new skills. And we're making this easy for them. And I'm happy to hear more and do it, but I'm an advocate I go to middle schools, I go to high schools, I go to colleges. Colleges are a different story. We provide school classes and we provide our technologies at the universities because enterprises need that talent, need that skill, when they graduate, their going to hire them just like I'm going to hire them into my organization. >> So my number one complaint my kids have about school, they're talking about kids that, oh school's going to be a waste it's so linear I can learn everything on YouTube and Google.com. All the stuff I learned in school I'm never going to use in the real world. So the question is, what skill should kids learn that could be applied to machine learning, thinking, the kind of constructs, data structures, or methodologies, what are some of the skills and classes that can tease out and be natural lead into computer science and machine learning A.I.? >> You know, actually their going to build up the skills. The languages will evolve and so forth. As long as they have that inner curiosity asking new questions, how can I find the answer a little faster, that will push them towards different sets of tools, different sets of areas. If you go to Berkeley in here, you will see a whole bunch of high school kids working side by side with graduate students asking those questions, developing those skill sets, but it's all coming down to their curiosity. >> And I think that applies for business too. I mean there's a big gap between the A.I. haves and have-nots I always say. And the good news here that my take away is, you're going to buy A.I, you're going to buy it from people like Google and you're going to build it and apply it, you're going to spend time applying it, and that's how these incumbents can close the gap and that's the good news here. >> Very true if you look at it, look at all the A.P.Is that we have. From text recognition to image recognition to whatever it is, those are all built models and I've seen some customers build some fantastic applications starting from there and they use their own data, bring it in, they update their model for their own businesses cases. >> It's composition it's composing. It's not coding it's composing. >> Exactly, it's composing. We are taking it to the next level. That abstraction is going to actually help others come into the field because they know their field of expertise, they can ask direct questions. You and I may not know it but, they will ask direct questions. And they will go with the tools available for them for the curiosity that they reach. >> Okay what's the coolest thing you're working on right now? >> Coolest thing, I just y'know streaming is my baby. We are working on, I want to solve all the streaming challenges, whatever the industry is. I really want to welcome everyone, bring you to us. I think, if I look at it, one of the things we discussed today was Antos was fantastic right? I mean we're really going to change the game for all enterprises to be able to provide those capabilities at the infrastructure. But imagine what we can do with all the data analytics capabilities we have on top of it. I think this is the next five years is going to be fantastic for us. >> What's the coolest use case thing you see emerging out of streaming? >> Ah you know, yesterday I actually had one of my clients with me onstage, AB Tasty. They had a fantastic capability that they built. They tried everything. And we were not their first choice, I'll be very open. They said the same thing to everybody, you guys were not our first choice. They went around, they looked at all the tool kits, everything. They came they used PostUp, they used data flow, they used engine, streaming engine. And they AB testing for marketing. And they do that at scale, billions of messages every minute, and they do it within seconds, milliseconds, 32 milliseconds at most. Because they have to make the decision. That was awesome, go check. I don't know if you're familiar with that. One of our customers, they provide these real time delivery. In India, imagine where things are. In global leaders, you can actually ask for a food to be delivered and they have to optimize, depending on what the traffic is and go with their scooters, and provide you this delivery. They aren't doing it as well. Okato, they believe, provide food in UK 70% of the population use our technologies for real time delivery. Those are some great examples. >> Evren, great insight, great to have you on. Just a final word here, next couple years, how do you see the trajectory of machine learning A.I. Analytics feeding into the value of making life easier society better, and businesses more productive? >> We are seeing really good pull from enterprises from every archival that you can think of. Regulated, retail, what have you. And we're going to solve some really hard problems whether it's in health care industry, financial industry, retail industry, we're going to make lives of people much easier. And their going to benefit from it at scale. And I believe we're just scratching the tip of it and you're seeing this energy in here. Year over year this has gotten better and better. I can't wait to see what's going to happen next year. >> Evren Eryurek great energy, expert at A.Is, streaming analytics, again this is early days of a brand new shift that's happening. You get on the right side of history it's A.I. machine learning, streaming analysts. Thanks for coming, I appreciate it. >> Thank you so much, take care guys. >> More live coverage here in theCUBE in San Francisco at Google next Cloud 2019. We'll be back after this short break.

>> Live from San Francisco, it's theCUBE, covering IBM Think 2019. Brought to you by IBM. >> Hey, welcome back everyone this is theCUBE's live coverage in San Francisco, California Moscone Center for IBM Think 2019. It's the wrap up of our four days of wall-to-wall live coverage. All the publishing on Siliconangle.com. I've got the journalism team cranking it out. Dave Vellante just put up a post on Forbes, check that out. And Stu's got the team cranking on the videos. Stu and Dave, four days, team's done a great job. Tons of video, tons of content, tons of data coming through theCUBE. We're sharing that live, we're sharing it on Twitter, we're sharing it everywhere on LinkedIn. What's going on with the data? Let's synthesize, let's extract the signal from the noise, let's assess IBM's prospects in this chapter two, as Ginni says. A lot of A.I., lot of data, I mean IBM is an old company that has so much business, so many moving parts and they've been working years to kind of pivot themselves into a position to run the table on the Modern Era of computing and software. So, what do you think, Dave? >> Well, I mean, this has been a long time coming and we're here, you pointed out John, to me privately that IBM's taking a playbook similar to Microsoft in that they're cloudifying everything. But there's differences, right? There's a bigger emphasis on A.I. than when, not that Microsoft's not in A.I. they of course are, but when Microsoft cloudified itself there wasn't as much of an emphasis on A.I. Ginni Rometty said, "Well, the first chapter was only about 20%, the remaining 80% is going to be chapter two. We're going hard after that." I wrote in that post today that, in 2013, IBM had a wake-up call. They lost that deal to Amazon at the C.I.A. They had to go out and buy Softlayer because their product was deficient, their cloud product was deficient. >> And by the way it looks like they're going to lose the JEDI Contract by the D.O.D., another agency that's a 10 billion dollar contract. >> So we can talk about they're going to lose that one too. >> We can talk about is Amazon's lead extending in Cloud? And so, IBM cannot take on Amazon head-to-head in infrastructures of service period, the end. It doesn't have the volume, >> And they know that, I think. >> It doesn't have the margins, and they know that. They got to rely on it's, as a service business it's SaaS, it's data, it's data platforms, obviously A.I. and now Red Hat. The fact that IBM had to spend, or spent, 34 billion dollars on Red Hat, to me underscores the fact that it's Cloud and it's 10-year attempt to commercialize Watson, isn't enough. It needs more to be a leader in hybrid. >> And let's talk about the Red Hat acquisition because Ray Wang on theCUBE yesterday and said, "Oh, P.E., private equity prices are driving up 34 billion dollars, pretty much market in today's world." He thinks they overpaid and could have used those services. You debated that, you've heard me say that, hey I could have used that 34 billion dollars of cobbled-together stuff, but you made a comment around speed. They don't have the gestation period there to do it. So, if you take market price for Red Hat, Stu, with open shifts accelerated success since Kubernetes really accelerated its adoption. You got IBM now with a mechanism to address the legacy on premise into Cloud Modern, and you got with this Cloud Private, Stu, this really is a secret weapon for IBM and to me, what I'm pulling out of all the data is that Rob Thomas at Interpol, the CDO have a great data A.I. strategy as a group. They have a team that's one team and this Cloud Private is a secret weapon for them. I think it's going to be a very key product and not a lot of people are talking about it. >> Well John, it shouldn't be a secret weapon for IBM because of course IBM has a strong legacy in the data center. We've talked about Z this week, you talk about power, talk about all the various pieces. Red Hat absolutely can help that a lot. What we noticed is there wasn't a lot of talk about Red Hat here just because it's going through the final pieces. We expect later this year to come out, but it's about the developers. That is where Red Hat is going to be successful, where they are successful and where they should be able to help IBM leverage that going forward. The concern we have is culture. IBM says that Red Hat will be separate. There will be no layoffs, they'll keep that alone but when I wrote about the acquisition I said, we should be able to see, for this to really be a successful acquisition, we should be able to see the Red Hat culture actually influence what's happening at IBM. And to be honest when I talk to people around this show, they're like, "That's never going to happen, Stu." >> I just want to make a point about the price. Ray was saying how they overpaid and made the private equity thing. IBM's paying a hundred and ninety dollars a share. If you dial back to June of '18, Stu you and I talked about this in our offices, Red Hat was trading at one seventy five a share. So they're paying an 8 1/2% premium over that price. Yes, when they made the deal in the fall you're talking about a 60% premium. So, the premium is really single digits over what it was just a few months earlier. >> And Cisco, Google, >> It was competitive, right. >> Microsoft all could have gone after that. I think it's a great buy for IBM. >> That's what they had to pay to get it. >> And definitely it helped there. So from my stand-point, looking at the show this week, first of all I was impressed to see really that data strategy and how that's pervasive through the company and A.I. is something that everyone's talking about how it fits in. John you commented a bunch of times Ginni mentioned Kubernetes two times in her Keynote. So, they're in these communities, they're working on all these environments. The concern I have is if this is chapter two and if A.I. is one of the battlefields, Amazon's all deep into A.I. I think heavily about Google when I talk about that. When I talk to Microsoft people they're like, "Satya Nadella is Mr. A.I.", that's all they care about. >> I don't think Microsoft has a lot of meat on the A.I. bone either. >> Really? >> No look it, here's the bottom line. A.I. is a moonshot it is an aspirational marketplace. It's about machine learning and using data. A.I.'s been around for a while and whoever can take advantage of that is going to be about this low-hanging use cases of deterministic processes that you throw machine learning at no problem. Doing cognition and reasoning a whole 'nother ballgame. You got state, this is where the Cloud Native piece is important as a lynch-pin to future growth because that wave is coming. And I think it's not going to impact IBM so much now, as it is in the future, because you got developers with Red Hat and you got the enablement for Cloud growth, Modern Cloud, stuff in any Cloud. But IBM has a zillion customers Dave, they have a business, they have mission critical workloads. And you pointed out in the Forbes post that we posted and on the Silicon Angle, that I.T. Economics are changing. And that the cloud services market is growing, so IBM has pre existing, big mission critical companies that they're serving. So, you can't just throw Kubernetes at that and say lift and shift. Z's there, you got other things happening. So, to me, that is IBM's focus, they nail their bread and butter, they bring multi-cloud from the table. Throw hybrid at it with Private Cloud and they're stable. Everything else I think is window dressing in my mind, because I think you're going to see that adoption more downstream. >> Well, the other thing you gave me for the piece actually, you helped me understand that IBM with Red Hat can use Cloud Native techniques and apply them to its customer base and to really create a new breed of business developers, right? Probably not the hoodie crowd necessarily, but business developers that are driving value apps based on mission critical apps and using Cloud Native techniques. Your thoughts on that? >> The difference between Oracle and IBM is the following, Oracle has no traction in developers in Cloud Native, IBM now with Red Hat can take the Cloud Native growth and use containers and Kubernetes and these new technologies to essentially containerize legacy workloads and make them compatible with modern technologies. Which means, if you're in business or in I.T. or running a lot of big shops, you don't have to kill the old to bring in the new. That's one factor. The other factor is the model's flipped. Applications are dictating architecture. It used to be infrastructure dictates what applications can do, it's completely reversed. We've heard this time and time again from the leading platforms, the ones that are looking at the applications with data as a fabric in there will dictate resource, Whether it's one Cloud or multiple Clouds or whatever architecture that's the fundamental shift. The people who get that will win and the people who don't won't. >> And the other thing I've pointed out in that article is that Ginny kept saying it's not backend loaded, The Red Hat deal, it's not back end loaded. IBM has about a 20 billion dollar business, captive business, in outsourcing, application management, application modernization and they can just point Red Hat right at that base, bring it's services business, Stu you've made this point, it's about scaling Red Hat. Red Hat's what, about a three and a half billion dollar company? >> Yeah >> And so that really is, she was explaining the business case for the acquisition. >> Yeah absolutely, I mean we've watched IBM for years, Bluemix had a little bit of traction but really faltered after a while, that application modernization. You hear from IBM, similar to what we've heard from Cisco a few weeks ago, meet customers where they are and help them move forward. We did a nice interview this week with a UK financial services company talking about how they've modernized what they're doing. Things like I.T. ops, new ops, these environments that are helping people with that app development. 'Cause IBM does have a good application work flow. There's lots of the infrastructure companies don't have apps and that's a big strength. >> When was the last, I got a direct message from the crowd, I want to get to Stu, but I want to ask you guys a question. When was the last time you saw a real innovation and disruption in a positive way around business applications. We're talking about business applications, not a software app, that's in a created category. We're talking about blocking and tackling business applications. When have you seen any kind of large scale transition innovation. Transition and innovation at the business application level? >> Google Docs? I mean >> I mean think about it. >> Right? >> So I think this is where IBM has an opportunity. I think the data science piece is going to transform into a business app marketplace and I think that's where their value is. >> Workday? >> Service Now. >> It's a sass ification of everything. >> Salesforce? >> Service Now, features become products. Products become companies. I mean this a big debate. I mean you can win on >> But that's not, Service Now really not a business, I mean it is a business app but it's more of an I.T. app. Alright Workday I'd say is an example. Salesforce I guess. >> And look here's one of the flaws in that multi-cloud picture, is it's I'm going to take all this heterogeneous environment and I'm going to give you a multi-Cloud manager. We've seen that single pane of glass discussion my entire career and it never works. So I'm a little concerned about that. >> So Andy Jassy makes the case that multi-cloud is less secure, more complex, more expensive. It's a strong case that he makes. Now of course my argument is that it's multi-vendor. It's not really multi-cloud. >> Well here's the Silicon Valley >> So he didn't have any control over that. It's not a procurement thing, it's just the way that people go by. >> The world has changed with cloud and I'll give you a Silicon Valley example anecdote. It used to be an expression in Silicon Valley, in venture capital community if you were a start-up or entrepreneur you'd build a platform. And there was an old expression, that's a feature, not a company. Kind of a joke within the VC community and that's how they would vet deals. Oh, that's a good feature" >> "Oh it's a feature company." >> "That's a great idea." Now with Cloud as a platform and now with all the stuff that's coming to bear, horizontally scalable, all the things that IBM's rolling out, sets the table for a feature to be a company. Where you have an innovation at the business model level, you don't really need tech anymore other than to scale up build it out and that's all done for you by other people. So people who are innovating on say an idea, well let's change this little feature in HR app or, that could meet up to Workday. Or let's change this feature. Features can become companies now so I think that's my observation. >> I think it's really interesting >> It could live in the cloud marketplaces too. It's so easy to get that scale if I could plug into all those marketplaces. IBM for years has had thousands of partners in their ecosystem. Of course Amazon's Marketplace, growing like gangbusters. >> But this is what Jerry Chen said when we were at Reinvent last year and we were asking him about Amazon, will it go up the stack, will it develop applications? He said, well, look but then what we got to do is give people a platform for application developers to build those features to disrupt, to your point, the core enterprise apps. Now, can IBM get there before Amazon, who knows? I mean its. >> Alright guys let's look at the big picture, zoom out. Your thoughts on Think 2019 IBM Think, Stu what's your final thoughts? >> Yeah, final thoughts is, I think IBM first of all is coming together. Just as this show was six shows and last year it was in two locations, there's cohesion. I heard the four days of interviews, we saw a lot of different pieces. Everything from talking about augmented reality through storage and we talked about the Z, and those pervasive themes of data, A.I., Dave what do you call it, It's the innovation cocktail now in Cloud. Data A.I. in cloud, put those three together. >> Innovation sandwich, innovation cocktail. Got to have a cocktail with a sandwich. That's your big take away? Okay, my take away Dave is that the, you nailed it in your post I thought, you should go to Forbes and check out, search on IBM Think you'll find the post by me and Dave Vellante but it's really written by Dave. I think to me IBM can change the game on two fronts. I learned and I walked away with a learning this week about these business apps. To me, my walk away is there's going to be innovation at a new genre of developers. I think you're going to see IBM target, they should target these business app ties as well as with the Could Native in Red Hat. I really think highly of that acquisition. From a speed stand point, I think the culture of Red Hat, although different, will be a nice check against IBM's naturally ability to blue-wash it. Which means you don't want to lose the innovation. I think Ginni saying Kubernetes twice on stage, is a sign that she sees this path, I think the Cloud Private opportunity could be a nice lever to bring open shifts and Kubernetes into that growth. And I think A.I. is going to be one of those things where they're either going to go big or go home. I think it's going to be one of those things. >> My take, love the venue, way better than last year in terms of the logistics. I like the new Moscone, easy to get around. May next year, May 2020 is going to be better than February here. I would've liked to see Ginni sell harder. She laid out a vision, she talked about a lot of sort of of high level things. I would have liked to seen her sell the new IBM and Red Hat harder. I guess they couldn't do that because they're worried about compliance. >> Quiet Period? >> Yeah right, you know monopolistic behavior I guess. But that I'm really excited to hear that story and a harder sell on the new IBM. >> I think if they can take the Microsoft playbook of cloudifying everything going with the open source with Red Hat and then just getting the great Sass if app revenue up, they're going to, can do well. >> Alright guys, great job. Thanks for hosting this week. Lisa Martin's not here today. Want to thank Lisa Martin if you're out there watching, great time. Guys, thanks to the crew. Thanks to IBM. Thanks to all of our sponsors that make theCUBE do what we do and thanks for all of your support to the community. I'm John Furrier along with Stu Miniman. Thanks for watching. See you next time. (pulsing electronic music)

>> Announcer: Live, from San Francisco, it's theCUBE. Covering Red Hat Summit 2018. Brought to you by Red Hat. >> Hello everyone, welcome back, this is day three of theCUBE's exclusive coverage of Red Hat Summit 2018, live in San Francisco, California, at Moscone West. We're out in the open, in the middle of the floor here, I'm John Furrier, your co-host, with my co-host to speak, John Troyer, co-founder of TechReckoning, advisory and community development firm, our next guest is CUBE alumni Kim Stevenson, Senior Vice President, General Manager of the Data Center Group Solution segment at Lenovo, great to see you. >> Hey, how are you? >> Thanks for coming on, so Red Hat Summit, Lenovo, okay, how does that fit together for you guys, Data Center obviously is cloud now, and you got on-premise-- >> We're both in Raleigh (Kim laughs) >> You moved to Raleigh, news, what's the update? Where's that connection with an hybrid cloud is taking this world by storm? >> Yeah, so, we're a great partner with Red Hat, and we're very focused on enabling that hybrid enterprise through hybrid cloud. So one of the things that we've done, we do a lot of co-development, but one of the things is we've taken our systems management software, which is Xclarity, and we're the first to embed that into cloud forms, so that we can move assets, public assets to private assets, and vice versa, and that wouldn't be possible without working really closely with Red Hat, so-- >> Well Red Hat's been very strong at support, and you go to the RHL side, on the operating system side, very reliable, it's got years and years of experience, but it's always been kind of let's certify the hardware, and now that you have a hardware at the baseline moving up the stack, you have OpenShift, getting huge success, Kubernetes, now you've got multiple clouds, which has other hardware, security becomes a concern, we hear that, okay, security being on top of that's a really big deal. How does that change the game for you guys, how are you guys adjusting to that, because it requires everyone to do more work, but now you got automation playing a role, take us through that relationship between from the hardware all the way up to the stack. >> Yeah, and it is the weakest link issue, right, that every piece of the solution has to be secure in and its own right, and the solution has to be secure, right? So, we do a lot in the hardware environment through our supply chain, we have efficacy of every part and component that goes in, every piece of software loaded through manufacturing, one of the benefits of having your own manufacturing organization, so we know what give is a secure platform when there is ready to go. But then as you start to add the software, this is where things like containers become really important, and the ability to do monitoring of the environment, without having to stop the environment. And, so, we have a lot of investment going in OpenShift, and we've launched recently a DevOps practice, based on OpenShift, to actually accelerate the deployment of more and more containers, to again, figure out the security by design versus security after the fact. The problem with monitoring is it's after the fact. You want to design in, and you need to rethink the application structure in order to be able to do that. >> Talk about Lenovo's strategy and innovation around enterprise and emerging tech, because, consumerization of IT has been topic, we talk about going way back, many, many years, but actually, the role of consumer hardware products is becoming more and more enterprise, as IoT for instance, becomes a critical piece of the network, whether it's new wearables for humans, or a security camera on a network, the edge of the network is now the IoT device, but also the data center can be considered an edge, a big edge, right? So, you have now devices everywhere, that's not so much consumer-ish, it really has to be enterprise, and cloud enabled. What are you guys doing in the innovation area there? What are some of the things that Lenovo's doing to move the needle on really making a seamless IoT edge, secure, and functional? >> Yeah, so, one of the things, if you look back at the last ten years of IT, right, we've spent a lot of time as IT organizations consolidating data centers, and then, basically, getting rid of people in IT, right? The simplicity of an AWS, and Azure Stack, has actually driven down the number of operational people in IT. And now you're hitting this wave where, on-prem private clouds, are becoming more and more important. It could be the analytic workloads, it could be your blockchain workloads, but the workloads that you want to keep on-prem, and you're going, "Holy crap, I need a robust "operational organization to actually "make this come to life." So that was one of my predictions for this year, was operational simplicity rises in importance, and our response to that from a Lenovo solution is to build fully-integrated appliances. So we have fully-integrated private cloud appliances based on Azure Stack, based on Nutanix, based on VMware's vSAN, ready nodes, so that you pick either at the software layer only, or you can pick a fully-integrated appliance where it's integrated in the factory, that's what I call rack-and-roll, comes with white glove support, and you need far less operational people. And if you want to know, I mean, it's mimicking that simplicity that AWS offers, right? So it's really an application team that now can manage this entire operational environment. >> So is that targeted towards folks who are transitioning to cloud operations? One of the things about true private cloud is, they're essentially rebooting their organizations to be cloud operations, essentially. >> That's right, yeah. >> And so they want that plug-and-play, if you will, I use that old term, but, just out of the box, and then it becomes a resource on the network, is that what you-- >> Yeah, well everybody says, they say the hardware doesn't matter, well it matters (laughs), you know, because it what makes everything run. But what they mean by that is they don't want to mess with it, it needs to be a no-fuss, no-muss, it needs to be there like a utility, but not have to have the resource dedication that used to exist, where I needed storage admins, and database admins, and server admins. That level of monitoring and management has to be abstracted to the software layer, and you have to then be able to integrate your resource components to be able to do that, and look at it as a system, not as a component. And that's where we're headed with our strategy. >> Yeah, Kim, that's a great consumption model, right? An increasing part of the market, converged infrastructure, hybrid conversion infrastructure, like you say rack and, what'd you use? >> Rack-and-roll. >> Rack-and-roll, I like that. But the hardware does matter, right? A few years ago, if you'd listen to some people, we were going to be inside public clouds with some sort of undifferentiated pools of x86 servers out there, but it turns out the actual hardware, and the integration pieces, do matter. John mentioned IoT, AI, we've seen some examples of it here at the show, real world examples, and then for that, hardware really starts to matter. Can you talk a little bit about how Lenovo's looking to some of these emerging tech? >> At the beginning of the year, we formed an IoT division specifically to focus on IoT, and it really is bringing the edge to life, that's the mission of that particular organization. And so, we see sort of the remote office, branch office concept that has long since, I mean, it goes back to AS/400 days, right? You had branch office computing. But, reinventing itself in a modern way into these edge servers that can be rugged-ized, for, you know, we have edge servers in windmills, as an example, to manage and monitor a windmill farm, right? To optimize generation with wind shifts, those kinds of things, but it could be a closet, right, and it could-- >> It's not a data center. >> It's not a data center, is in a physical construct of a data center, is in the functionality provided, it is a data center, and so, we have from our PC group one of the things I'm pretty interested about is we have these things called stackables, so they're about five by eight inches of a PC, and then you can magnetically connect a battery to a magnetically projector to it through magnets, and you can get basically a stack of computing power. So, we've looked at that from our PC colleagues, and said, "Huh, that's the future of the edge, "but it needs to be ZEON class, "it needs to be enterprised as manageability,", and so it won't be five inches by eight inches when we're done, but, it will use some of that IP in the stackable nature, that will allow you, then I can put that stackable unit on the back of a television monitor for a smart display, I could put it back on a kiosk, or a vending machine, or, and all of the sudden, now I can get really different customer experience at the edge, and then I can parse data, maybe I don't need that data, to go back to the cloud, maybe I do need some of that, for, you know, machine-learning capabilities, I want to create big data sets back in the cloud, you can create that level of intelligence at the edge, and parse the data, to where you think the appropriate destination for that data is. >> How important is the IoT edge for you guys, and what should customers who are trying to merge cultures of OT, Operational Technology, with IT? 'Cause now you have IP devices. Which, it creates a security potential, but, there's now policy involved, you got to write software apps for it, you got unique use cases, talk about the importance of the IoT edge, for Lenovo, and what customers should be thinking about when they architect. >> So, my starting point is every piece of equipment becomes an IP-enabled device that will generate and collect data, you're going to have to figure out how to use that data, right? I said to our facilities leader, not too long ago, I said, I pointed at the table, at the conference table we were at, "What do you think this is?" And he's like, "Uh, it's table," and I'm like, "Hmm, no, to me, this is a smart table. "It could be IP-connected, and we could figure out, "is it the right value for this particular room," and you could just get into these crazy things, some will make sense, some won't make sense, but basically, I think every company is looking at how do they make their products and services smart by wrapping them with IT-enabled services. So that creates a new edge. We used to think of endpoints as PCs and phones, now there are cars, and you know, any form of transportation vehicle, they're windmills, they're semi-conductor equipment, you name it. And, that is sort of the new, that's where we are trying to attack, from the IoT perspective, what we're trying to help customers understand is, it's that data collection use case analysis that will enable them. One of my favorite examples is Ford has a prototype product, it's not a car, it's a baby crib. Now, why, right? So, through autonomous driving, they collect a bunch of data, everybody knows that when new parents have a cranky baby in the middle of the night, what do you do, you put 'em in the car, you take 'em for a ride, right? So this baby crib mimics the motion of a car, mimics the sound of an engine, and mimics the streetlights. There's no more taking your baby for a ride in the middle of the night, you put 'em in the bed, yeah, we've all done it! And this is why these endpoint devices collecting data to figure out these new products and services, and I just think, whether they ever bring that to market or not is not the point-- >> It's new experiences. >> It's a brilliant idea, and gives you a really good illustration of how creating these smart-enabled endpoints will allow you to generate new business opportunities. >> That's been a real theme here at the show, getting beyond the technology, right? Transformation is kind of a buzz word, but, I loved that they didn't put a huge amount of tech on stage, they really did talk to the people here, attendees, about, "Look, you've got to step up, "you've got to have new ideas, "you've got to affect the business." How are you, as you talk with both of your customers and inside Lenovo, addressing those kind of transformation and business ad sorts of deals? >> Yeah, look, I said today, and I really believe this, there's a new mandate for IT. The table stakes of keeping the business running, of course we have to keep the business running and running well, right? But really, every IT leader should be thinking about how do they redefine the customer experience for their organization, how they drive extreme productivity, through AI and blockchain and stuff, companies today are extraordinarily inefficient. We all live in a company, and we can tell you it's inefficient, right? But, you now have the ability to affordably drive out that inefficiency through this level of extreme productivity, and then everybody needs to be thinking about the future of the company, what are you in the business of, and how do you wrap those with new products and services, whether it's adjacent markets that you're going to create, or it's enhancements of your existing product, so you can reach new customers, new markets, and that's a far more interesting role for IT, but you can't give up the ship either, right? You cannot let operational performance decline while you're operating on the new mandate, which is why new operating models for IT, and the hyper-converged infrastructures, and in-- >> Containers have been a great help there too-- >> Containers, right, we just have to fundamentally re-architect, so that it's easy to actually drive change, flawless change, into the enterprise, and, the volume of change for our future is twice as great as what we've experienced in the past, and if you accept that as a premise, you'll rethink how you've done your architecture, and how you promote code into production, and how you manage that code going forward. >> We always love having you on theCUBE, 'cause you always do predictions, so I want to go back and get some predictions from you. What's your predictions next year, what do you see happening, you know, by the way, you have been right in a lot of your predictions, so, we have the tapes, we can go back and look at the videos. (laughs) Ah, I guess you were right on that one! What's your predictions this year, I mean obviously you've seen a lot going on, we are talking about, here on theCUBE, seeing what's going on with Kubernetes, change to OpenShift, that a new internet infrastructure's being recast, with compatibility modes, with containers, and Kubernetes for orchestration, cloud scale, you can come up with IoTs, a new infrastructure, and upgrade, is coming. So there's a lot of things happening. So what's your prediction, what's going to happen over the next year? >> Yeah, so I actually believe this is the first year that we have human capacity in IT organizations to reinvent the enterprise structure, which comes led with an enterprise architecture discussion. We've been moving more cloud to the cloud SaaS applications, you know, infrastructure as a service, and that is now absorbed enough into that you can stand back and look at it, so I do believe that, I call it data centers go micro, that the era of data center consolidation is over, that we will be more data centers, they just will be micro-data centers, because they will reflect the edge of every company, and those endpoint aggregation that you need to do to figure out what your data analysis is going to be. I also think that the operational simplicity that operating models are going to be redefined, as more and more private clouds get deployed, the structure of an IT organization has typically looked like this, you have four basic functions, you have IT engineering, IT operations, application development, and applications maintenance. That's typically the structure. I think you're going to see a collapsing of that. There actually is no reason for four independent functions, you need to organize by line of business, and the business outcome you're trying to drive, and, workers are going to need to be more versatile, in terms of being able to span, you're going to abstract a lot from the infrastructure, right, so you need to be able to manage at a higher level, therefore you can't organize in that discreet manner, and I think you'll start to see that come life-- >> John: Like horizontally scalable people. >> Sounds like horizontally scalable people, yeah. >> You've been a CIO at Intel, you have a lot of varieties of roles sittin' on some boards, you're now in an executive role at Lenovo, you're managing products, your responsibilities are building, shipping and business performance as well. How has your role changed? You've been there for about what, a year and a 1/2 or so? >> Yep, just about a year. >> Just about a year, what's the energy like, what are you bringing to the teams, what's your vision, what's your to do list within Lenovo to take it to the next level? >> Yeah, so when I started with Lenovo because I considered Lenovo the underdog, in the data center industry, which was going through phenomenal change, right? And so, the underdog has the best opportunity to capture hearts and minds and share when the industry's going through change, and so that's what attracted me. And it's been true. We organized, about this time last year, by customer segment, to serve the unique needs of our customers in terms of hyper-scaling customers, high performance compute and enterprise, both at the software-defined and traditional layer. And, in that one year, we've won six out of the ten top hyper-scalers in the world, from zero to six in a year, we consider that to be great, and we learn so much from their, they're doing a lot of customization, and they're two, three, four years ahead of what the general enterprise will consume, and so we're able to take that then and pull it back into our private cloud deployment strategy, into our enterprise management, software management, and strategy, because we see what they're doing, and use that as a virtual cycle of life, and we've got a lot of momentum in that area. And our employees are just excited about how much progress we've made in a year. And I would say if you pulled ten of 'em, nine out of ten would've said they wouldn't have believed we could make so much progress in one year. And that's a good feeling to have. Now, there's more work to do (laughs). >> Yeah, you have product leadership, you've got some great products, it's now just focus and getting on the right wave, right? I mean, 'cause the industry is changing! >> Kim: The industry is changing-- >> So you can move the needle big time. >> Yeah, and we've chosen from a software perspective, we've chosen a deep partnership model, with Red Hat as one of the partners, and so, if I look forward, and I would say, "Look, "we're going to have to go deeper and partner more broadly "across the ISV sphere to continue to bring "these tightly integrated appliances "in simple cloud deployment models to the market," and that's what you'll see us do next. >> Well it's exciting for you, and congratulation on that, and they're lucky to have you, and we know from when you were at Intel, you've seen the playbook, you know? (laughs) A lot of change going on, so great to see you, congratulations, we sure did love covering Lenovo, a lot of great action, thanks for your support, and thanks for coming on, sharing your insights here on theCUBE again, appreciate it. >> Thanks for having me. >> Kim Stevenson here outside theCUBE for Red Hat Summit 2018, live in San Francisco, I'm John Furrier with John Troyer, we'll be back with more, after this short break. (bright electronic music) (soothing music) >> Oftentimes the communities already know about a facility that's a problematic because, they smell it, they see it, but, again, they don't have the evidence to basically prove that whatever's happening with their health is related to that facility. (bright music) If you have a low-cost instrument that's easy to use, then all of the sudden, science becomes something that everyday people can do. (bright music) (somber electronic music) >> Hi I'm John Furrier, the co-founder of SiliconANGLE Media, and co-host of theCUBE. I've been in the tech business since I was 19, first programming on minicomputers in a large enterprise, and then worked at IBM and Hewlett Packard, a total of nine years in the enterprise, various jobs from programming, training, consulting, and ultimately, as an executive salesperson, and then started my first company in 1997. And moved to Silicon Valley in 1999, I've been here ever since. I've always loved technology, and I loved covering, you know, emerging technology. I was trained as a software developer, and loved business. And I loved the impact of software, and technology, to business. To me, creating technology that starts a company and creates value and jobs is probably one of the most rewarding things I've every been involved in. And, I bring that energy to theCUBE, because theCUBE is where all the ideas are, and where the experts are, where the people are, and I think what's most exciting about theCUBE is that we get to talk to people who are making things happen. Entrepreneurs, CEO of companies, venture capitalists, people who are really on a day-in and day-out basis, building great companies. And the technology business has just not a lot of real time, live TV coverage, and theCUBE is a nonlinear TV operation, we do everything that the TV guys on cable don't do. We do longer interviews, we ask tougher questions, we ask sometimes some light questions, we talk about the person, and what they feel about. It's not prompted, and scripted, it's a conversation, it's authentic. And for shows that have theCUBE coverage, it makes the show buzz, it creates excitement, and more importantly, it creates great content, and great digital assets, that can be shared instantaneously through the world. Over 31 million people have viewed theCUBE, and that is the result of great content, great conversations, and I'm so proud to be part of theCUBE, we're a great team. Hi, I'm John Furrier, thanks for watching theCUBE. (soothing music) >> Man: One of the community's goals.

>> [Announcer] 18, brought to you by Red Hat >> Well, welcome back everyone. This is theCUBE's exclusive coverage here in San Francisco, California, for Red Hat Summit 2018. I am John Furrier, co-host of theCUBE with my analyst co-host this week, John Troyer, co-founder of the TechReckoning advisory services. And our next guest is Arvind Krishna, who is the Senior Vice President of Hybrid Cloud at IBM and Director of IBM Research. Welcome back to theCUBE, good to see you. >> Thanks John and John great to meet you guys here. >> You can't get confused here you've got two John's here. Great to have you on because, you guys have been doing some deals with Red Hat, obviously the leader at open storage. You guys are one of them as well contributing to Linuxes well documented in the IBM history books on your role and relationship to Linux so check, check. But you guys are doing a lot of work with cloud, in a way that, frankly, is very specific to IBM but also has a large industry impact, not like the classic cloud. So I want to tie the knot here and put that together. So first I got to ask you, take a minute to talk about why you're here with Red Hat, what's the update with IBM with Red Hat? >> Great John, thanks for giving me the time. I'm going to talk about it in two steps: One, I'm going to talk about a few common tenets between IBM and Red Hat. Then I'll go from there to the specific news. So for the context, we both believe in Linux, I think that easy to state. We both believe in containers, I think that is the next thing to state. We'll come back talk about containers because this is a world, containers are linked to Linux containers are linked to these technologies called Kubernetes. Containers are linked to how you make workloads portable across many different environments, both private and public. Then I go on from there to say, that we both believe in hybrid. Hybrid meaning that people want the ability to run their workload, where ever they want. Be it on a private cloud, be it on a public cloud. And do it without having to rewrite everything as you go across. Okay, so let's establish, those are the market needs. So then you come back and say. And IBM has a great portfolio of Middleware, names like WebSphere and DB2 and I can go on and on. And Red Hat has a great footprint of Linux, in the Enterprise. So now you say, we've got the market need of hybrid. We've got these two thing, which between them are tens of millions, maybe hundreds of millions of end points. How do you make that need get fulfilled by this? And that's what we just announced here. So we announced that IBM Middleware will run containerized on Red Hat containers, on Red Hat Enterprise Linux. In addition, we said IBM Cloud Private, which is the ability to bring all of the IBM Middleware in a sort of a cloud-friendly form. Right you click and you install it, it keep it self up, it doesn't go down, it's elastic in a set of technologies we call IBM Cloud Private, running in turn on Red Hat OpenShift Container service on Red Hat Linux. So now for the first time, if you say I want private, I want public, I want to go here, I want to go there. You have a complete certified stack, that is complete. I think I can say, we're a unique in the industry, in giving you this. >> And this is where, kind of where, the fruit comes off the tree, for you guys. Because, we've been following you guys for years, and everyone's: Where's the cloud strategy? And first of all, it's not, you don't have a cloud strategy you have cloud products. Right, so you have delivered the goods. You got the, so just to replay. The market need we all know is the hybrid cloud, multi-cloud, choice et cetera, et cetera. >> You take Red Hat's footprint, your capabilities, your combined install base, is foundational. >> [Arvind] Right >> So, nothing needs to change. There's no lift and shift, there's no rip and replace, >> you can, it's out there it's foundational. Now on top of it, is where the action is. That where you're kind of getting at, right? >> That's correct, so we can go into somebody running, let's say, a massive online banking application or they're running a reservation system. It's using technologies from us, it's using Linux underneath and today it's all a bunch of piece pods, you have a huge complex stuff it's all hard-wired and rigidly nailed down to the floor in a few places and now you can say: Hey, I'll take the application. I don't have to rewrite the application. I can containerize it, I can put it here. And that same app now begins to work but in a way that's a lot more fluid and elastic. Or my other way: I want to do a bit more work. I want to expose a bit of it up as microservices. I want to insert some IA. You can go do that. You want to fully make it microservices enabled to be able to make it into little components >> and ultimately you can do that. >> So you can take it in sort of bite size chunks and go from one to other, at the pace that you want. >> [John F.] Now that's game changing. >> Yeah, that's what I really like about this announcement. It really brings best of breed together. You know, there is a lot of talk about containers. Legacy and we've been talking about what goes where? And do you have to break everything up? Like you were just saying. But the announcement today, WebSphere, the battle tested huge enterprise scale component, DB2, those things containerized and also in a frame work like with IBM, either with IBM microservices and application development things or others right, that's a huge endorsement for OpenShift as a platform. >> Absolutely, it is and look, we would be remiss if we didn't talk a little bit. I mean we use the word containers and containerized a lot. Yes, you're right. Containers are a really, really important technology but what containers enable is much more than prior attempts such as VM's and all have done. Containers really allow you to say: Hey, I solved the security problem, I solved the patching problem, the restart problem, all those problems that lie around the operations of a typical enterprise, can get solved with containers. VM's solved a lot about isolating the infrastructure but it didn't solve, as John was saying, the top half of the stack. And that's I think the huge power here. >> Yeah, I want to just double click on that because I think the containers thing is instrumental. Because it, first of all, being in the media and loving what we do. We're kind of a new kind of media company but traditional media is been throwing IBM under the bus since saying: Wow old guard and all these things. Here's the thing, you don't have to change anything. You got containers you can essentially wrap it up and then bring a microservice architecture into it. So you can actually leverage at cloud scale. So what interests me is that you can move instantly, >> value proposition wise, pre-existing market, cloudify it, if you will, with operational capabilities. >> Right. >> This is where I like the Cloud Private. So I want to kind of go there for a second. If I have a need to take what I have at IBM, whether it is WebSphere. Now I got developers, I got installed base. I don't have to put a migration plan away. I containerize it. Thank you very much. I do some cloud native stuff but I want to make it private. My use case is very specific, maybe it's confidential, maybe it's like a government region, Whatever. I can create a cloud operations, is that right? I can cloudify it, and run it? >> Absolutely correct, so when you look at Cloud Private, to go down that path, we said Cloud Private allows you to run on your private infrastructure but I want all these abilities you just described John. I want to be able to do microservices. I want to be able to scale up and down. I want to be able to say operations happen automatically. But it gives you all that but in the private without it having to go all the way to the public. If you cared a lot about, your in a regulated industry, you went down government or confidential data. Or you say this data is so sensitive, I don't really, I am not going to take the risk of it being anywhere else. It absolutely gives you that ability to go do that and that is what brought Cloud Private to the market for and then you combine that with OpenShift and now you get the powers of both together. >> See you guys essentially have brought to the table the years of effort with Bluemix, all that good stuff going on, you can bring it in and actually run this in any industry vertical. Pretty much, right? >> Absolutely, so if you look at part what the past has been for the entire industry. It has been a lot about constructing a public cloud. Not just us, but us and our competition. And a public cloud has certain capabilities and it has certain elasticity, it has a global footprint. But it doesn't have a footprint that is in every zip code or in every town or in every city. That's not what happens to a public cloud. So we say. It's a hybrid world meaning that you're going to run some workloads on a public cloud, I'd like to run some workloads on a private and I'd like to have the ability that I don't have to pre decide which is where. And that is what the containers and microservices, the OpenShift that combination all give you to say you don't need to pre decide. You rewrite the workload onto this and then you can decide where it runs. >> Well I was having this conversation with some folks at a recent Amazon Web services conference. Well, if you go to cloud operations, then the on premise is essentially the edge. It's not necessarily. Then the definition of on premise, really doesn't even exist. >> So if you have cloud operations, in a way, what is the data center then? It's just a connected issue. >> That's right, it's the infrastructure which is set up and then, at that point, the Software Manger, at the data center, as opposed to anything else. And that's kind of been the goal that we're all been wanting. >> Sounds like this is visibly at IBM's essentially execution plan from day one. We've been seeing it and connecting the dots. Having the ability to take either pre-existing resources, foundational things like Red Hat or what not in the enterprise. Not throwing it away. Building on top of it and having a new operating model, with software, with elastic scale, horizontally scalable, Synchronous, all these good things. Enabling microservices, with Kubernetes and containers. Now for the first time, >> I can roll out new software development life cycles in a cloud native environment without forgoing legacy infrastructure and investment. >> Absolutely, and one more element. And if you want to insert some cloud service into the environment, be it in private or in public, you can go do that. For example, you want to insert a couple of AI services >> into the middle of your application you could go do that. So the environment allows you to, do what you described and these additionals. >> I want to talk about people for a second. The titles that we haven't mentioned CIO, Business Leader, Business Unit Leaders, how are they looking at >> digital transformation and business transformation in your client bases you go out and talk to them. >> Let's take a hypothetical bank. And every bank today is looking about simple questions. How do I improve my customer experience? And everybody want, when they say customer experience, really do mean digital customer experience to make it very tangible. And what they mean by that is how do I get my end customer engaged with me through an app. The app is probably in a device like this. Some smart phone, we won't say what it is, and so how do you do that? And so they say: Well, all obviously to check your balance. You obviously want to check your credit card. You want to do all those things. The same things we do today. So that application exists, there is not much point in rewriting it. You might do the UI up but it's an app that exists. Then you say but I also want to give you information that's useful to you in the context to what you're doing. I want say, you can get a 10 second loan, not a 30 day loan, but a 10 second loan. I want to make a offer to you in the middle of you browsing credit card. All those are new customergistics, where do you construct those apps? How do you mix and match it? How do you use all the capabilities along with the data you've got to go do that? And what we're trying to now say, here is a platform that you can go, do all that on. Right, that complete lifecycle you mentioned, the development lifecycle but I got to add to it >> the data lifecycle, as well as, here is the versioning, here are my AI models, all those things, built in, into one platform. >> And scales are huge, the new competitive advantage. You guys are enabling that. So I got to ask you a question on multi cloud. Obviously, as people start building out the cloud on PRIM and with Public Cloud and the things you're laying out. I can see that going on for a while, a lot of work being done there. We're seeing that Wikibon had a true Private Cloud report what I thought was truly telling. A lot of growth there, still not going away. Public Cloud's certainly grown in numbers are clear. However, the word multicloud's being kicked around I think it's more of a future stay obviously but people have multiple clouds Will have relationships with multiple clouds. No one's going to have one cloud. It's not a winner take all game. Winner take most but you know you're have multiple clouds. What does multi cloud mean to you guys in your architecture? Is that moving workloads in real time based upon spot pricing indexes or is that just co-locating on clouds and saying I got this app on this cloud, that app on that cloud, control plane it. These are architectural questions. What the hell is multicloud? >> So there's a today, then there is a tomorrow, then there is a long future state, right? So let's take today, let's take IBM. We're on Salesforce, we're on ServiceNow, we're on Workday, we're on SuccessFactors, well all of there are different clouds. We run our own public cloud, we run our own private cloud and we have Judicial Data Center. And we might have some of the other clouds also through apps that we barter we don't even know. Okay, so that's just us. I think everyone of our clients are like this. The multicloud is here today. I begin with that first, simple statement. And I need to connect the data and can connect when thing go where. The next step, I think people, nobody's going to have even one public cloud. Even amongst the big public clouds, most people are going to have two if not more That's today and tomorrow. >> Your channel partners have clouds, by the way, your Global SI's all have clouds, theCUBE is a cloud for crying out load. >> Right, so then you go into the aspirational state and that may be the one you said, where people just spot pricing. But even if I stay back from spot pricing and completely (mumbles) I make. And I'm worrying about network and I'm worrying about radio reach. If I just backup around to but I may decide I have this app, I run it on private, well, but I don't have all the infrastructures I want to burst it today and I, where do I burst it? I got to decide which public and how do I go there? >> And that's a problem of today and we're doing that and that is why I think multicloud is here now. >> Not some point in the future. >> The prime statement there is latency, managing, service level agreements between clouds and so on and so forth. >> Access control on governance, Where does my data go? Because there may be regulatory reasons to decide where the data can flow and all those things. >> Great point about the cloud. I never thought about it that way. It is a good illustration. I would also say that, I see the same arguments in the data base world. Not everyone has DB2, not everyone has Oracle, not everyone has, databases are everywhere, you have databases part of IoT devices now. So like no one makes a decision on the database. Similar with clouds, you see a similar dynamic. It's the glue layer that, interest me. As you, how do you bring them together? So holistically looking at the 20 miles stare in the future, what is the integration strategy long-term? If you look at distributed system or an operating system there has to be an architectural guiding principle for integration, your thoughts. >> This has been a world 30 years in the making. We can say networking, everyone had their own networking standard and the, let's say the '80s probably goes back to the '70s right? You had SNA, you had TCP/IP, you had NetBIO's-- >> DECnet. DECnet. You can on and on and in the end it's TCP/IP that won out as the glue. Others by the way, survived but in packets and then TCP/IP was the glue. Then you can fast forward 15 years beyond that and HTTP became the glue, we call that the internet. Then you can fast forward and you can say, now how do I make applications portable? And I will turn round and tell you that containers on Linux with Kubernetes as orchestration is that glue layer. Now in order to make it so, just like TCP/IP, it wasn't enough to say TCP/IP you needed routing tables, you needed DNS, you needed name repository, you needed all those things. Similarly, you need all those here are called the scatlog and automation, so that's the glue layer that makes all of this work >> This is important, I love this conversation because I have been ranting on theCUBE for years. You nailed it. A new stack is developing and DNS's are old and internet infrastructure, cloud infrastructure at the global scale is seeing things like network effect, okay we see blockchain in token economics, databases, multiple databases, on structure day >> a new plethora of new things are happening that are building on top of say HTTP >> [Arvind] Correct! >> And this is the new opportunity. >> This is the new platform which is emerging and it is going to enable business to operate, as you said, >> at scale, to be very digital, to be very nimble. Application life cycles aren't always going to be months, they're going to come down to days and this is what gets enabled >> So I what you to give your opinion, personal or IBM or whatever perspective because I think you nailed the glue layer on Kubernetes, Docker, this new glue layer that and you made references to, things like HTTP and TCP, which changed the industry landscape, wealth creation, new brands emerged, companies we never heard of emerged out of this and we're all using them today. We expect a new set of brands are going to emerge, new technologies are going to emerge. In your expert opinion, how gigantic is this swarm of new innovation going to be? Just, 'cause you've seen many ways before. In you view, your minds eye, what are you expecting? >> Share your insight into how big of a shift and wave is this going to be and add some color to that. >> I think that if I take a shorter and then a longer term view. in the short term, I think that we said, that this is in the order of $100 billion, that's not just our estimate, I think even Gartner has estimated about the same number. That will be the amount of opportunity for new technologies in what we've been describing. And that is I think short term. If I go longer term, I think as much as a half but at least a fourth of the complete IT market is going to shift round to these technologies. So then the winners of those that make the shift and then by conclusion, the losers are those who don't make the shift fast enough. If half the market moves, that's huge. >> It's interesting we used to look at certain segments going back years just company, oh this company's replatformizing, >> replatforming their op lift and shift and all this stuff. What you're talking about here is so game changing because the industry is replatforming >> That's correct. It's not a company. >>It's an industry! That's right. And I think the internet era of 1995, to put that point, is perhaps the easiest analogy to what is happening. >> Not the emergence of cloud, not the emergence of all that I think that was small steps. >> What we are talking about now is back to the 1995 statement >> [John] Every vertical is upgrading their stack across what from e-commerce to whatever. >> That's right. >> It's completely modernizing. >> Correct. Around cloud. >> What we call digital transformation in a sense, yes >> I'm not a big fan of the word but I understand what you mean. Great insight Arvind, thanks for coming on theCUBE and sharing. We didn't even get to some of the other good stuff. But IBM and Red Hat doing some great stuff obviously foundational, I mean, Red Hat, Tier one, first class citizen in every single enterprise and software environment you know, now OpenSource runs the world. You guys are no stranger to Linux being the first billion dollar investment going back >> so you guys have a heritage there so congratulations on the relationship. >> I mean 18 years ago, if I remember 1999. >> I love the strategy, hybrid cloud here at IBM and Red Hat. This is theCUBE, bringing all the action here in San Francisco. I am John Furrier, John Troyer. More live coverage. Stay with us, here in theCUBE. We'll be right back. (upbeat music)

>> Narrator: Live from the Moscone Center it's theCUBE, covering AWS Summit San Francisco 2018. Brought to you by Amazon Web Services. >> Hello everyone and welcome back to our exclusive Cube Coverage here in San Francisco, California for Amazon Web Services AWS Summit 2018. We are all day covering the regional event for Amazon Web Services. I'm John Furrier with Stu Miniman, our next guest is Steve Hall, vice president of partnerships at a company called, CloudCheckr. Cloud check with an r dot com. Companies we see in the ecosystem doing great stuff really capturing the growth of the cloud. Steve, welcome to theCUBE. >> Thank you for having me. >> So I got to ask you, so you guys are like Switzerland, you guys are involved in a lot of the stuff. Before I go into some of the pointed questions, we'll have to get your thoughts on the cloud, but take a minute first to explain what CloudCheckr does, your core business, and why are you calling yourself "Switzerland". Is it like you play nice with all the clouds? Is that where all the cryptocurrency is going to go? I mean give us a straight scoop. >> Sure you bet, so CloudCheckr is a cloud management platform, right, that helps organizations get visibility in control across their public cloud estate. So, you know the challenges that we're seeing really typically fall into two categories. It's "I thought it was going to save me money when going to the cloud" and "I thought that my data was going to be less secure going into the cloud". CloudCheckr helps solve both those problems by helping you reduce costs, eliminate waste, all that good stuff, as well as, identify your attack surface and make sure that its protected. >> John: Is it SaaS offering or is it more... >> SaaS offering, born in the cloud for the cloud. We focus as you said, Switzerland, we really focus on sort of a management layer that sits across a multi-cloud environment where you're not just looking at Amazon and AWSs, but also the Azures and GCPs of the world to make sure that you have kind of that unified single pane of glass that everyone kind of wishes for but they don't necessarily know how to get. >> Yeah and I get the joke on Switzerland with the cryptocurrency. There's legit people are going to Switzerland but metaphorically you guys are, you're independent you want to play with all clouds cause you got to look at the holistic picture. What's the critical thing that you're seeing right now? We had a guest on earlier talking about you leave the lights on so to speak. You know the EC2 is running a lot of inefficiencies. You got security. Are you guys kind of like a dashboard, single pane of management glass in there? Is it other services? What specifically are you guys focused on right now? Obviously the growth of the cloud is what it is. You guys, that's a tailwind for you guys. >> Yeah I mean. >> The key thing that you do? >> So I mean I think the biggest thing that we see driving our business right is the economics around the cloud. Everyone's moving, the workloads are you know obviously whether they're in the early days or kind of more mature, everyone thinks that by moving to the cloud they're going to save money. And there's data out there to suggest that there's upwards of 30 to 40 percent wastage happening inside of the cloud environments today just because people, using that analogy, leave light switches on, and they didn't even realize that they, they didn't know how to find them, right. So where we see a lot of pain, right, is what do I do, right? Where do I start? And so partnering with not only the native tools that Amazon brings to bear, you know trusted advisor and specter, all the other cool tools... >> So is a new term being developed called cloud sprawl? Stu we talked about server sprawl. I mean you've got Lambda now. I mean is it cloud sprawl? Is that an issue? >> Oh there's so surely. And cloud spend sprawl, right. You know it's this shadow IT thing that goes on. Somebody told me a story of the CMO at Bank of America got a phone call a couple of years ago from the CEO after a Superbowl ad that ran and said what is this thing that you're doing? And she said oh we just turned it on in the cloud. And he's like did you talk to IT? Did you have anybody do it? And she's like why would I do that? Why would I even bother? I can just go do it myself. So how do I get my arms around that. Right obviously is somewhat of an opportunity but also challenge. >> Steve you talk about getting your arms around something. When we talk to customers, you know IT is heterogeneous. >> Steve: Right. >> So you know yes public cloud and people are growing and using more Amazon, but there's other clouds, there's by service providers, and oh yeah I've still probably got some data centers because you know there's 35 years after you stopped building those a few years back for you to do that. How do you help them get around there? And I'd love to hear how are you seeing Amazon maturing and working in some of those environments. It used to be Amazon is all in public cloud only. Then it was oh there's the VMWare stuff, there's the RedHat stuff. Oh hey they're starting to work with service providers even. What are you seeing and how are you involved in that? >> Yeah you bet. I mean again I think you touch on again probably the biggest problem which is visibility, right? And transparency. And how do I create accountability around all of that because there's new roles that are emerging inside of these organizations to try to do things with this cloud stuff as well as a lot of questions are being asked. They don't even know how to answer them. And so you know where Amazon I think is really maturing, we'll start there, right is not only providing a lot of just the native tooling, it's somewhat kind of yes Amazon focused but focused really on kind of providing that, that visibility that they need. Where I think CloudCheckr really kind of steps in is sort of a little bit deeper level view of what they have as well as how do you cross-pollinate that with the other environments. Whether it's a hybrid environment or another cloud provider that you want to again kind of bring into one singular view. That's really how we try to help. And then I think that the other piece that you touched on, which is there's this whole managed service provider and reseller community that's really quite mature in fact within the AWS ecosystem. Which I think is one of the things that AWS really kind of differentiates itself with by empowering partners to be able to build a practice around AWS. Because again another challenge that we see is cloud is great, but I don't have the people to do it. Or I don't know what the people that I do have don't know what to do and so having a trusted like a managed service provider to turn to to go do that stuff is like a blessing. >> What sort of areas, where can that local managed service provider, where can they help? You know is it just cause they have localized people? But what services od they have, is it just enabling people to get up into the cloud? Or are there things that they're doing between you know the service provider and Amazon with direct connect and the like? >> Well I think that so the first thing honestly ends up becomes billing truthfully. And that sounds so boring in many respects, but okay I get a bill, but the billing is really... >> Stu: Yeah the CFO doesn't think it's boring. >> But they don't. As well as you get the bill, how do I make sense of it right? And so you know clients are looking for managed service providers to sort of make sense of all of this cost data and usage data and give them sort of the view of who's using what and how much should we spend right? Because money talks. And so that is driving a different conversation for managed service providers. So building, we're seeing a lot of our partners working up new practices around cost optimization and how to build an entire, not only just billing portal, but a practice on top of that to help optimize the environment for... >> Well there's such a huge opportunity there. I've talked to customers that were like I dedicated engineer to do financial engineering rather than architecting. >> Yeah, yeah. >> So there's an opportunity when you see that it's like oh wait, do you want a head count of a highly trained engineer? >> Right. >> Or you know is there, that's what the partner can help with right? >> Yeah and there's a couple of different ways that they can do it too. We see partners, some that are hiring the smart guy in the room, putting him in a back room and doing the analytics and analysis around that data. Others are literally just creating white labeled portals and putting it in front of their customers. So there's lots of different ways that AWS makes it easy for a partner to build new products and actually turn their seven percent margins into 20 percent margins by building more services and solutions around the AWS infrastructure. >> Steve I want to get your industry expertise on something. You're the vice president of partnerships and you know we always talk on theCUBE, Stu, myself, Dave Vellante, Jeff, Rick, and the team around what it's like to compete in a modern era. And we commented on Amazon's competitive strategy. For the first time they've got to actually deal with heavy dose of competition. >> Steve: Yeah. >> And no one's going to give up the market share. They've got to fight tooth and nail. You deal with all the cloud providers. But people are learning there's a new kind of partnership. If everything's API based you've got SAASified, platform as a service kind of going away to infrastructure as a service. You have this cloud fabric, global reach with regions, all kinds of new moving parts. How is it changing partnerships? How do, how should people who are in trying to partner with the big clouds. >> Steve: Yep. >> Is there a posture, is there an approach, is there a playbook that you see that's different than the old way? The old was you know, press the pavement, press the palms together, you get dinner, you get coffee, whenever you do a deal, longer time horizon. Now it's you've got to have services, you got the data, whole different landscape. What's your thoughts on the partner equation. How should people partner, what's the playbook? >> And I'll speak on for CloudCheckr's perspective. So we've been going to REInvent and these summits for the last five, six years, right. So I remember when this was 500 people in a room, right. You know and there's 10 vendors exhibiting. And here you have 7,000 plus people now that are, you know where you have lots of vendors that you're very familiar with, right. That are large scale kind of like global vendors. So definitely the competitive landscape has changed and it's partly just like you said, the opportunity, right. This is a... I heard somebody say it's probably market cap of a a trillion dollars in public cloud right at the end of the day. So everyone sees the opportunity but how do you actually make good use of it as a partner to the cloud providers? First of all you solve a real problem. Right? There's a lot of... I tend to see a lot people that are just cloud dipping their solutions and kind of coming to market around things because they want a piece of the pie. But if you really focus yourself on how do I solve some of the most pressing needs. And that's where again we see, you know, our product helping customers around cost and security but even our partners. >> So the ecosystem is the key. You've got to be part of a ecosystem. Is that the criteria? >> You got to play, well yeah, it's not just go to coffee and have drinks. Right you know what I mean. It's connect with the people inside of your community. Whether it's at these events or whether it's in your local AWS offices or in the smaller sort of settings to say what are your customers asking for right? And how can we help you with that? I mean it's pretty obvious stuff. >> So Steve, you mentioned security a few times. You know if you go back a few years it was like oh I'm going to be less secure if I go to cloud. Now most people realize it's an opportunity for me to readdress security. >> Yeah. >> And chances are security's better because when's the last time I really updated all my security. >> Yeah. >> What are the hot buttons? What are you seeing? What's Amazon doing well? What does the industry as a whole need to do better? >> Absolutely well I mean you touched on it. Security used to be the reason not to go and now it is the reason to go. And I think companies realize oh my God they've got hundreds of security engineers. We have two. So I think that their infrastructure's probably more secure. What we're seeing as the hot press buttons. I mean I think the last 18 months, 12 months have been all about S3 buckets, right. You know and all of this data that's been exposed sitting out there on the internet. And I think AWS did a fabulous job of changing some of the configurations to allow customers not to stab themselves in the foot. But I think that a lot of it ends up being human error, right. You know really it's the human element inside of security that continues to plague the industry. And the cloud only makes it harder because now you don't have IT people doing IT. You've got business people doing IT, right. Back to the Bank of America example. So, sorry Bank of America. So my point is yeah I think that you know it's really back to how do we create solutions that non-IT people can use and make sense of it so that we can put common sense good controls in place. >> Business models are critical nailing the business model's critical. >> Steve: Yeah. >> Alright Steve final question for you. I want to kind of just put you on the spot a little bit here. You guys are trying to solve a real big need in the market place. Becoming a trusted source for cloud optimization, cloud costs, I mean it's going to impact obviously financial workflows and rolling the data up so a lot of moving parts at AWS and other clouds. >> Yeah. >> So are you guys using machine learning and AI because if Werner Vogels says hey look at all the magic that can happen in the cloud, how are you guys using all these data points? How are you rolling them up? Can you share >> Yeah. >> the philosophy, the tech. >> Yeah. >> Are you guys cutting edge? Are you on the front bleeding edge? What... >> Absolutely. >> Are you guys eating your own job food? I mean I'm obviously putting you on the spot there. >> Yeah, no no that's fine. I mean so we are absolutely using machine learning and artificial intelligence on the back end. Using AWS technology in fact to empower a lot of that inside of the project or platform. And it is all about taking all of these disparate data sources, I called them machine exhaust, of the cloud right that's kind of coming out. How do I put good sense to that? And CloudCheckr really is that layer above all of that whether it's your cloud trail logs or your cloud watch metrics or your cloud usage report, putting it all into one place and then doing machine learning and predictive analytics around that. That's exactly what CloudCheckr's all about. >> So it's an interpretation challenge, right. >> Right, right I mean, go ahead. >> Yeah so Steve it's just we talked about kind of the heterogeneous nature and you brought up a term a service area. >> Steve: Yeah. >> When we start adding in things like IOT, service area's going to grow exponentially and the heterogeneous nature >> Yes. is just going to go up you know. >> Steve: Yeah. >> The same. Is CloudCheckr going to help there? Is that something your customers are ready for? >> I think they're already there right. So I mean I think a lot of our customers, like the use cases that we see are either big data analytics or IOT or you know some other use case around why they're using public cloud to begin with. And so really it's about as that expansion increased usage occurs, how do I protect that attack surface? How do I look for known good state information and then lock my doors and windows if you will? As well as how do I make sure that I'm using the right resources in the right way? So that again I have that visibility and transparency and then you can have the right controls and automation around it to do something about it. >> Steve thanks for coming on theCUBE. Really appreciate it. Check out CloudCheckr. >> Thanks. >> Again this is one of those things as you use the cloud there's going to be more bells and whistles, more services to watch and instrument. Obviously cost containment and managing the growth is certainly going to be something to watch using the data and managing that's what CloudCheckr does. Of course theCUBE is bringing all the data here at the trusted source for all the action at AWS Summit 2018. I'm John Furrier, Stu Miniman. More coverage after this short break. (upbeat music)

(upbeat music) >> Live from the Mission Bay Conference Center in San Francisco, California, it's theCUBE at Google Cloud Platform Live. Here are your hosts, John Furrier and Jeff Frick. >> Okay welcome back everyone, we are live. This is theCUBE in San Francisco, California for Google Platform Conference Live, their developer conference for the cloud. I'm John Furrier, the founder of SiliconANGLE, Jeff Frick, my cohost, and we're excited to have CUBE alumni but also man about town coming to talk about containers, Kubernetes. We have Craig McLuckie, product manager at Google. Named the product Kubernetes. Welcome back. >> Thank you. It's great to be back on theCUBE. >> As I said, you're the man about town. Containers are the hottest thing going on. Really enabling a lot of new change. A lot of solidarity in the developer community around bringing cloud together, right? You're seeing people go, wow, containers are not a new concept. Docker has brought together the concept and made a huge push, just the ball got moved down the field big time. And then Kubernetes kind of tying it all together and you guys are open sourcing it. I wanted to first talk about, from your perspective, what's changed since VMware where we had a great conversation around Kubernetes? Obviously that was front and center in VMware's show, which is a huge IT enterprise vote of confidence. So now, here at Google, core developers. Large scale, backend network interconnect stuff going on. You almost connect the dots, right? Native developers really cranking out the apps? Large scale interconnect? There's a lot in the middle there between those bookends. What's changed? >> So a couple things I think have changed since I last spoke to theCUBE at VMworld. The first is we've seen an amazing amount of velocity around the Kubernetes community. Not just what Google's been doing but also what our open source community members have been contributing. And we're seeing a very fast acceleration of the overall platform. Moving quickly towards operation maturity, you know getting closer to production readiness and introducing a lot of features that are really need to both run real world applications and to go to new place, to go to a variety of new clouds. We're seeing the reality of a very highly portable and maturing way to build container based applications emerging. That's been very exciting. I think the other thing that's really interesting here is the way that we at Google have been introducing Kubernetes directly into the Google Cloud platform. Today we announced a new product called Google Container Engine which provides the quickest and easiest way to get a Kubernetes cluster up and running and managed for you on Google Cloud platform. And we're very excited about how easy it's making it for our customers to access this new way of building applications. >> Talk about this Container Engine because obviously App Engine's had huge success. Little bit of learning curve but you guys have some core front end developers that you're making that easier now but what is a Container Engine? Is it a Docker engine? Is it Docker compatible? Is it a whole new animal? What it is? What is it? >> That's great, I'm glad you asked that question. I would start by saying this, at Google we have Google Compute Engine which offers powerful, flexible, fast breeding VMs and at the other end of the spectrum we've had App Engine which offers a highly managed, very efficient way to get web applications up and running. And what we've encountered with our customers is that there is no natural way to move from one world to the other world. There's no connective tissue that exists in the middle that let's our customers think about building applications that are running on a cloud computer rather than just running on a virtual machine. And so what Google Container Engine is is a technology that let's our customers program at the cluster level. So Docker has provided this amazingly productive way to package up an application and deploy it into a node. Docker has done a great job of taking a lot of technologies that existed and making them incredibly accessible to developers. But the reality, in our experience, is that at least 80% of our customer's cost of maintaining applications comes out of the operation space so Kubernetes and Google Container Engine are an operationally viable way to build these distributed applications. It really moves our customers from thinking about deploying things into individual virtual machines to instead saying, hey, I'm just going to drop this into this cluster and it will all be wired together so I can take these little Lego building blocks I've got called containers, piece them together in ways that are intuitive and then have a very smart and effective system to run those for me on my behalf.. >> So basically a pool of VMs could be available to developer, if I get this right? So you're saying, I'm a developer, I don't have to worry about the dependencies by VMware, by VMware versus another form factor? I just let the container deal with that? Is that-- >> What we've done, yes, that's exactly right, we've created this strong separation between infrastructure operations and application operations. Docker has created a portable framework to take basically a binary and run it anywhere which is an amazing capability. But that's not enough. You also need to be able to manage that with a framework that can run anywhere so the union of Docker and Kubernetes provides this framework where you're completely abstracted from the underlying infrastructure. You could use VMware, you could use Red Hat Open Stack deployment, you could run on another major cloud provider like Rack Space or IBM and you could just build this application and deploy it there and experience this very powerful cluster first way of building and managing that app. >> Cluster first, I haven't heard that one. >> It's not a cluster you-know-what, it's a cluster first. (laughing) That trumps cloud first from Microsoft but let's go back to Kubernetes. You named the product, what does it mean? I mean it's kind of a, you don't look at a tech name, you say, it's not like alpha one, ya know? >> Kubernetes is the Greek word for the helmsman of a ship. I was looking to find a name and turns out, there's a lot of cluster management technologies and a lot of the obvious names were taken and so I had the inspiration of what is this doing? It's actually the thing that's overseeing the whole of your operation, and is planning what goes where and managing it. So Kubernetes is the helmsman of your cluster group, it's the thing that manages it. >> Did you design the algorithm to stay away from icebergs? (laughing) That's the key thing, you don't want to crash the system. But that's the challenge, you know, just joking aside, orchestration is really a hard thing. That's been a cloud phenomenon, automation. Everyone's been talking about, oh we have management software that automates and orchestrates cloud resources. But now in a cloud environment, it's more challenging now. Talk about what Kubernetes does different than older approaches to orchestration. >> I think is a very, very important consideration. When I look at the way that orchestration's been done traditionally, you tend to think about your application as being deeply tied to the underlying piece of infrastructure, so your orchestration process is provision me a basic machine, go get the packages I need, deploy my application pieces, wire it in explicitly to all the other pieces of my system and so you have to kind of build this relatively fragile system where all the piece are tied together and deeply coupled. What Kubernetes has done is provide a framework where you have a very principled, almost Lego building block that you can stick together and say, I want one of these things, I want it replicated six times, and I want it wired in to these other pieces without actually having to know about where those other pieces are deployed, how they relate to one another. It really is realizing this highly decoupled, very principled way of thinking about your environment as a cluster where you just drop your packages in and they're all wired together using virtualized networking and using this cluster centric paradigm and it radically, radically reduces the cost of operations. I could just give you an example of that. In the old days of Google, before we had these technologies inside the house, it was all we could do to keep the lights on. Like every day was an adventure, it was very hard, because our operations had our application pieces deeply tied into the physical infrastructure. When we introduced the system internally known as Borg, we changed the game. In less than a year-- >> Hold on, name is Borg? >> What was it called? >> Borg? >> Borg. >> Borg. >> Internally known as Borg. (laughing) >> Like connected to everything, like the Microsoft Borg, that's at Microsoft but Microsoft used to be called-- >> I was thinking more Arnold Schwarzenegger, but that's alright. >> Continue. I just wanted to make sure we heard that right. >> We literally doubled the number of production services we were running within a year. It's just so much easier to run things at scale. >> So provisioning, managing, it just makes a smoother operation? Smooth sailing if you will? >> It's really trying to hide provision, managing, right? You're basically, I have an app and I want to build it easily and then I want to deploy it easily and then I want it to be able to scale easily. >> Yes. >> Without having to go back and reconnect it to more stuff. It's funny because I think most people think that that's what clouds have already always done, right? There's basically compute, a networking and storage that's just in small units, virtually available to assemble however I want. But you say it, I used to have to still assemble it and disassemble it, now it's just-- >> Exactly. >> It's just plugging in. >> That's the challenge. The way we've seen cloud evolving has disappointed us a little bit because it really is just a re manifestation of the same existing first generation way of thinking about application development, application provisioning. If you challenge a lot of the fundamental assumptions, if you really step back and think about is there a better way to do this? If I have all this incredibly fungible resource that can turn up and turn down, is there a better way to build applications? Kubernetes is our invitation to the community to participate in defining that thing. We think it is a better way to build applications. We know it because we've been doing this for 10 years and it works really well for us. >> So talk about the open source angle because one, Kubernetes is open source, we've reported that live when we last chatted. Docker has huge success with their open source model. That's not well known in the main world, how the nuance and developers really are engaged and motivated to play with Docker which has it's own flywheel effect which is very viral in network effect. What's your strategy with Kubernetes? Is it standard open source blocking and tackling? Is there things you're doing to prime the pump? Is there a magical formula you guys are really nurturing and fostering? >> I am very happy with the way that the projects been run and it's been humbling to see the amount of adoption success we've had. I think that this manner of operating where we built Kubernetes as an open source project with the community, and then we take it and take exactly that and we turn it into a service and add a lot high value capabilities to it, is a pattern that's working very well for us. It's massively increased our velocity because it's not just us that are actually developing the project, we have amazing contributions from people like Red Hat. They're putting a lot of time and effort into making this thing great. Our friends at CoreOS are putting a lot of effort into it. We're able to do more because it's just more people working on it, so the velocity is far higher. The second thing is that we were able to go straight to an open offer. Normally we do these early adopter programs hidden behind the curtain, try to figure stuff out and do a lot of iteration. We didn't have to do that because the community has built the API with us, our customers have been working directly with us to shape the API. We know it's going to work for them. >> And that's helped you guys, so your differentiation doesn't really conflict with the community? >> Absolutely not. We recognized as we moved from a cloud that's worked mostly in the start up community and with internet facing companies to a cloud that's really engaging mainstream business. Our customers want multi cloud. It's critical to them. They want to be able to run in hybrid cloud. They want to have multi cloud provider relationships. They don't want to just rely on one provider and so our framework that works well everywhere but works especially well on Google, serves our business very well. >> Getting some great prompts on Crowd Chat so thanks for coming on theCUBE, always great to chat with you. You're in a hot area, we'd love to pick your brain but I want you to address three things I'm going to say to you, get your thoughts on. >> Okay. >> It can be your Google perspective, could be your own geeky perspective. Perimeter-less IT, multi cloud and mobile infrastructure. Three of the hottest areas on the planet right now in terms of people looking at investments, retooling, trying to figure things out, perimeter-less IT. Obviously perimeter IT, perimeter based security? >> Sure. >> Kind of goes away with the cloud right? >> Yeah. >> But you still need security, it's perimeter-less, so what does that mean? How do people understand and grasp that concept? >> I'm not sure I'm the right person to speak to perimeter less IT but I can say that-- >> Just in general. >> When I think about it, I think there's a couple of things that are happening here that are really interesting. When I look at the idea of perimeter-less IT, when I look at the idea of what I consider the democratization of IT, if you will, we've lived in a world where most businesses have been beholden to a specific organization that's controlled their provisioning, the policies and the set of bits they can use, everything's been controlled and IT hasn't been well loved by and large. We're moving into a world where it's a much more open ecosystem. Departments are far more empowered, anyone with a corporate credit card can go and get a machine and that's creating amazing agility and velocity for businesses. But it's introducing-- >> Creativity, too. >> A lot of creativity, but it's introducing a lot of pain as well. The hard thing is going to be creating a smart framework that allows empowered decentralization. Going from this world of highly controlled to decentralized empowerment, and I think that's where we're going to see a lot of interest from folks that are operating in the airplay space. >> Okay, multi cloud, just in general. Will people move to multiple clouds? Do you see that? UberClouds, we had Bitnami in earlier like, ah, people aren't really going to multiple clouds. They're not interested in moving workloads. Is that a state of the current situation or will it evolve to workloads anywhere? >> Multi cloud is the reality of our world. There's no serious customer I've spoken to in the last six months that has not been interested in a multi cloud relationship. Sorry, that's not true, there's no enterprise customer I've spoken to the last six months. >> That has not been interested? >> That has not been interested in multi cloud. >> And the reason is? >> In some ways. >> It's for what, resources? >> There's a couple of reasons. One is a lot of companies want to have just a multi provider relationship. They don't want to be beholden to a single cloud provider and frankly almost every customer I speak to has a massive investment in on premise infrastructure. They want to move away from a lot of the pain associated with managing that, but it's not going to happen overnight. Hybrid cloud is going to exist for quite a while. >> This is back to your empowered decentralization theme. >> And we have to provide them the tools to do that. We have to create positive pressure that moves them from those clouds to the public cloud. >> Final concept, and I've heard this a lot, kind of leads into the keynote, not necessarily the words but almost reeking of this concept of mobile infrastructure. I mean, mobile first, cluster first, kind of enables mobile first but mobile is obviously a form factor, whether it's an internet of things as a human or a device, doesn't matter it's still an endpoint the network. >> Yeah. >> It's a multitude of millions of devices so what is mobile infrastructure? Is it different? Is it the same? What's your take on it? >> It's an interesting question and the reality of our world is it's a mobile world. It's almost folly to do anything but think about mobile as the primary vehicle for customers, consumers and everyone else to interface with the internet, with the web. It certainly introduces an interesting set of challenges to application developers. I think one of the things that I am most sort of interested in cracking from a cloud provider's perspective is the world of multiple devices where you have a large set of devices in different form factors that are ultimately presenting a view of the same set of data, the same set of information and creating a set of experiences that work well in that multi device space. Moving away from a world where state is bound to a device to a world where state is based in your cloud and your device is simply providing a view or a way to interface with that data. We still have a way to go before that is fully materialized but I think that's going to be a big sort of anchor point of a lot of mobile development in the space. >> So Craig, where's the locus of competition move then? If the data center just becomes a resource that's on tap, basically, that I can just get? How do the cloud providers then differentiate? >> Basic infrastructure is relatively undifferentiated but when I look at the way that we run inside Google, we do some really, really scary smart things to make your application run for you. If you think about the way we run our infrastructure it's almost like the flight controller of a modern airplane. It's going from the old wire based control system where you move something to move a flap to a world where you have this controller that's taking in million of signals a second and making incredibly informed decisions that is optimizing the heck out of everything you do and making very fine grain corrections and I think that's going to be a huge avenue of differentiation. When you take an application, you package it and you give it to us and you trust us to run it for you and it's running at a slightly higher level, we have a much high extraction level, we can do incredibly smart things with things like machine learning technologies. We can watch how your application's running. We know how it ran last time so we can tell if something's going wrong because we have the ability to actually watch it. This is how we run internally. >> Right, right. >> It's not just about the infrastructure. It's going to be about smart systems that run your application for you. And that's going to be hard to-- >> It's really to abstract above the management of the application. It's actually the management of the application and the optimization of the application as opposed to the infrastructure? >> There's so much more value in moving from static, dumb infrastructure to actively managed, sort of precision managed container based capabilities. It's quite jarring. This was clear to me very soon after we shipped Google Compute Engine. I was able to see, we never looked inside VM so we were able to see what level of CP utilization our customer's were getting and we compared that to what we were able to run in our internal web loads and our customers are only getting like, there were several integer multiples less utilization than what they were paying for. So we knew that something could be done. We could actually move up the abstraction layer and just do a better job by actively managing and making smart decisions. And that would be very disruptive-- >> So let's play a game, we played a game with our last guest, we'll play the game of you and I are going to go into business together and be venture capitalist. >> Okay. >> Okay. >> Sounds like fun. >> What's our investment thesis? Knowing what we know, I mean, there's a lot of entrepreneurs out there really looking at the enterprise right now. The enterprise is hard, cloud is kind of like a proxy for the enterprise but it's not like your classic enterprise. I'm a tech entrepreneur, I'm a coder, I'm an architect, I'm an OS guy, systems guy, could be a creative filmmaker, whatever but I want to come in and get some white space. Is there white space out there that you see that is an opportunity for developers that could really come in and stake claim and build a really good business? It could be lifestyle business, it could be a home run. Where would we invest? >> Yeah, I think there's so much white space in this domain. We are in the very early days of getting these technologies to market. Obviously there's just bolstering the basic, sort of the fundamentals of the platform. Overlay networking, everyone's talking SDN. Obviously there's a lot of hype around that but being able to create an abstraction that allows high levels of plugability for different network fabrics as you move between clouds is interesting. Storage, and doing a better job of providing virtualized storage that is available to these containers is an area of opportunity. There's a lot of work to be done in the tuning environment, full on application lifecycle management, continuous integration, lots of opportunity in that space. And then frankly, as we start looking at taking these technologies to market and deploying them into real businesses that are running multi cloud, there's going to be a lot of the governance, risk management and compliance overlay capabilities that just don't exist. We have the ability to define policy and enforce it in a very effective way, whether it's security policy, data loss prevention policy-- >> But it has to be dynamic, right? >> And it has to by dynamically done and it has to be enforced at the node. >> That's software, that's hard software? >> And there's so much work to be done there. There's so many opportunities to either create niche, vertically oriented capabilities of service specific protocol or unique, highly valuable, cross coding capabilities. I'm very excited about the future in this space. >> Where would we get started if I was an entrepreneur? Like, hey Craig, I saw your interview, where do I get started? Writing an app engine code? I want to put the boat in the water and starting drifting into this area you just mentioned, how should I navigate in? How should I vector in? >> A lot of it depends on where you're going to be operating in the stack. I would suggest you go and learn Go. Go is rapidly, GoLang, if you want to talk about the sort of the development environment is rapidly emerging as the language for the new cloud. We're seeing a lot of work in the Go community. Docker is written in Go, Kubernetes is written in Go. So I'd start there. It's a great platform for systems development. So I'd start looking at some of the existing technologies, Docker, Kubernetes, start just assessing where the gaps are. I'd probably approach it from a systems development perspective if I was doing it but there's also going to be a lot of value higher up the chain where you can actually-- >> You can dance on top of the stack and around the stack? >> Absolutely. >> Alright so final question, are we going back to the old OS days? I know you were joking before we came on, conversational even in a way, that was pretty relevant. I mean, we're seeing concepts of systems programming of the 80's kind of, but in decentralized way. Comment on that because I think that's tying a lot of things together. >> I think that's an incredibly astute observation and I think we're moving away from a world, operating system today is a node local thing, right? So I have an operating system and it's providing an environment that abstracts me from the physical details of one piece of hardware, one machine, you know one set of resources. What we're starting to see now is the emergence of some of these distributed concepts where you're programming not to a specific singe piece of infrastructure, single piece of hardware but you're programming to a cluster and so I think it's very much like that. I think that's a very astute observation and we're going to see the buzz-- >> But no one vendor owns it. It's owned by the world. >> And nor should one. It needs to be a POSIX like ubiquitous framework that let's us get more out of these cluster centric applications. >> Very organic, I mean I love what's happening is a very organic development but yet there's some, kind of group dynamics going on around cluster and Docker's a great example. Came out of the woodwork to become a defacto standard. Probably the fastest defacto standard that I've ever seen-- >> It's been breathtaking how quickly that technology's taken hold. >> And that's just the crowd. >> Yeah. >> Just saying, hey if we don't like decide on something? We like these guys the best, they didn't piss anyone off or whatever, whatever the dynamic is. It could be double source, flywheel, but-- >> It's interesting, certainly from Google's perspective, we've noticed Docker a lot sooner than most the world did. We had technologies that we could have stood up as potentially competing capabilities but we chose not to, because the world is incredibly well served by a single standard for defining and packaging applications. Now we need to continue that and we need to build the standard for the POSIX like distributed systems standard, that people think about coding to when they're building these modern, next gen cloud V2 applications. >> Craig, I really appreciate you spending the time. Love the conversation, love kind of the long winding road we took there. We knocked out some Kubernetes. We talked about Docker containers. Talked about the future of the industry. Really appreciate it, you're awesome to have on theCUBE here, you're invited any time. CUBE alumni Craig McLuckie right on theCUBE. We'll be right back, here, live in San Francisco broadcasting exclusively from Google's developer conference here, the Cloud Platform Live Event from Google. We'll be right back after this short break. (light music)

hey welcome back to VMworld 2013 this is the cube live in San Francisco California Moscone Center south lobby this is a cube our flagship program we go out the events expect to see the flu noise I'm John Frieda founder of silicon I'm joy of my coasts day Volante boogie bun or hi everybody wanna talk flash with Ken Grohe he's here from Viren and he's a worldwide vice president of customer ops Ken welcome to the cube thank you for a long time watcher of item appreciate that yeah so you're enough obviously smoking hot space we've been talking about in a flash all week you saw the announcements of you know V sand from from VMware that's you know great news for you guys and just you know give us the update on on Viren and you guys have you know really you know we know Mike so I'm Mike come on all of a sudden things started happening and did the deal with Seagate so what's what's the latest well the crux is numbers numbers speak more than anything so I'm pleased to see that our company's growing 300 this year which is a huge change and I realized flashes everything if you walk the floor right now and a lot of vibe I think about 23,000 people across the show I think most almost 80% exhibitors are all around flash so the good news about buried in though is we're really beginning to invest we started generally availability of our flash max connect software as of April so there's a lot of talk about creating a flash platform but really we're really walking the walk now by having the practive ailable having our high availability software available having our shareability software so it's not just selling flash for the performance aspects Dave it's really building and creating and leading a flash platform transformation and that's where we're gonna get through I think you've talked about prior questions about how do we get it to the enterprise space so the web scale I think we all know is all PCI flash based but how do we get to the brick-and-mortar enterprise space and I think the familiarity of getting to a platform that looks like a sand it feels like a sand and as the data services of a sand will albeit with the respect of the performance at microseconds that flash and only PCI Flash can provide from Vera Dhin I think that's how you get to enterprise accounts that everyone's like to see yeah I mean when you talk to people in the labs they they tout your product as you know one of the best if not the best out there but so that that flash transformation that's largely software lead absolutely so talk about that a little bit well it has to be software led because at some point you basically if you one of the troubles we have going through is do you want to buy a flash array and some of the in users might say where's PCI flash makes more sense where it does make more sense is your heritage behind it if you want to get close to the apt and you want to be closer to the actual performance behind it you want to get that performance but you also want the familiarity so you can go back to the IT director of the santa administrator and have the same type of data services or high availability that you might be accustomed to so that kind of bridges the gap between the person who's representing or maybe being the database administrator or maybe the application owner or actually the people they're administrating thus and so i mentioned the word transformation because i just didn't talk about how we're transforming the data center with flash and getting a greener i talked about how the people who manage the storage how they need to be professionally transformed I liken it to of we were in the business for a while I liken it to back when the first sands were sold people were putting raid storage out there but it wasn't until the transformation happened to sand and that IT professionals actually had to decide how you can have networking and actually have that build to everybody that transformation is happening today but would flash the building blocks PCI flash our company is uniquely equipped to actually bring out for lack of a better word of Veritas like what they do on the sand basis but actually have the high ability software the share building software actually in place so people can have a comfort and familiarity with the actual San in place ever have the speed as far as PCI flash can talk about the dynamic in the marketplace I'll see variants Lisa I always thought telling entrepreneurs this you get in the market is you're an entrepreneur you build a company you got to get on the field you can't score a touchdown or hit a homerun if you're not swinging at the plate or being on the field you can't really do anything from the stance you guys hit the flash thermal growth like all of a sudden the market was just realized spun in your direction your technology right there you're right with a puck came to you as they say in Wayne Gretzky analogy you guys were where the puffy you skated to where the puck was coming what is it about Bearden that makes it today really hot and you guys are growing get good growth sure 3% growth what's that 300% growth reason why the customers are buying tell share it the audience up there what three reitman what it is thanks for the questions I appreciate and thanks for acknowledging our growth and I shout out to our founders Kumar and Vijay who started this company seven years ago and then basically moved and worked it from nor flash and the appliance over to PCI flash two years ago but the reason for the growth is really threefold first off if you're an only M you really resonate with the fact that you've got unconditional performance at the higher you beat up this card the more there is an OEM would actually perform better for their applications and that that's why we're becoming a choice given the flash marketplace it's out there so performance number one o on condition performance if you go to our website that's our tag line I'm provision performance however you mentioned bring Wayne Gretzky on where the puck is going to where the pucks going to and I think you will you'll see our tagline kind of move towards is more of a leading the flash platform transformation so I mean by that it's it's the integrations Dave you mentioned before with high availability with shareability with caching software at the kernel level actually after the actual design for flash having them available so you actually can make that transition so no longer you clinging on to the stand tree you move into the performance of actual flash so that helps in the end user and what I've kind of done since I moved over in May is build what I think is a pretty good than using Salesforce and September 10th we'll talk about a partner kitty will be building as well but if you get the end user that creates the demand we're bringing on more more OMS I mention this card before you got om om and use direct sales in direct indirect indirect will be announced a separate tenth we are doing okay there are some of you big customers that's a big oh yes so if you don't extreme super flash that's a goob EMC is doing it yeah so and then um seagate of course x8 their product were very happy to be one of the providers of them as an OEM but over 50% of our sales to date have been to the direct end users that's where a big part of a business and that's that's where it really resonates people if you look I think Pat's first slide was he talked about how the applications going from first to second to third it's all consumer based it's all I carry an iPhone 5 F where I go when I I try to work at that type of real time speed with that type of transition to consumer eyes type applications you need a third generation type you know building blocks and that would be PCI flash my garden so I wonder if we could unpack a little bit more how you guys differentiate John I've been talking all week you know just that Jerry on from Kray lock just talking about the nightmare he really thought I and yeah but of course the other flipside of that is people saying it she's like the Winchester just drives to the 1980s you had 80 companies and and you know can the market sustain them also so how do you guys differentiate from all the here we always say extract the signal from the noise how do you differentiate from the other players out there well first off for the people who know the business the people that buy in by the pallet fall let's call it the scale that accounts the people they're leading us their new you've probably name the names before those customers the flash innovators they're buying pervasive flash they're the people who enjoy using the customer using actual product itself because it's got the highest high-end performance so unconditional performance you don't have the outliers the more you hit it with a high thread rights the high red thread reads that's where we really shine so thanks for noticing that as far as the customer base I mean the ability to have a vkn product with a right back no one else had well one of two players that have that as far as the VHA software its uniquely positioned so you have the same familiar out there and then every time they give an end-user presentation for my Salesforce when you see the V sharing capability as far as software that's truly unique Dave in the market talk about that V cashing with the right back I think you said that's unique so describe what that is and what makes it so hard well the reason why it's hard is you've got to have it so it conforms the existing systems you have to have in place so that the actual methodology in place as far as the applications and the accounts are you used to having different situations where you have the the same familiarity the same data services you have in place with right back you have different choices you have right through you have right around a write back cache and the fact that we've been in the flashing business you mentioned it acknowledged the newer appliance with our founders that you know this is this is knowing our first first attempt in the flash marketplace we've been in the biz five years before we went to PCI flash we can do the hard business that we can do the different choices for customers whether it be right back right through a right around and supposed to be caching but the truth is when we go in and user sales calls they always resonate around shareability they like the fact that you can put this as a 2.2 terabyte card they like they can share some of the namespaces and we convey shares across the different so you actually have a shared pool of these spaces around the different pool of flash I think earlier today I know Carl mentioned it I know Pat mentioned yesterday that's truly unique for us the ability to share and access has cross more users but you had mentioned I think when the raid vendors were out there there was like 20-something raid vendors but then after the change to the San marketplace to get down to two or three I think you didn't see that type of change around flash as well there are five or six flash PCI Flash vendors I think we're gonna be one of the three or four that people built bet their business on because we have a familiarity of having that software and that's where our investments are Ken talk about something that's I'm always gonna stickler on like buzz words but and but it did some of these things matter high availability Madison unquestioned is a word that's like a punchline it's like cost of ownership it does it's relevant but I want to actually specifically what is change in the current marketplace around high availability high availability is a table stakes kind of deal for a lot of the infrastructure side I mean that's a goal where everyone wants high availability like freedom right so so but what is about high availability today well it's different than was a couple years I'll give a tangible example one of our best use cases with the VHA software that you just mentioned as well as Oracle RAC some of our customers want the demands of Oracle RAC and the bridges the way that that can seamlessly work in their environment and to be blunt with you you get the speed of PCI flash but the affordability of putting you know a few cards in your environment and have that be able to do it but you have the blessing and the endorsement of actually having a rack environment have it out there so that's the way I view high availability at the highest levels five nine step availability where the customers could depend upon it and that's something you got to pitch a lot with your clients all day that's that's probably a second most proficient servers and my availability kind of go hand in hand I mean well sometimes they don't I mean people don't have availably they don't go down they're not performing so it's kind of like a implied benefit yeah John it's its database it's we're doing great in the e-tailing marketplace so I think the bricks and mortar type companies that are putting a front end that looks amazing like Google or amazing like Amazon amazing like Facebook but there's still the large retailers you might go shop on a weekend with so some the people at the show are talking about two major themes we're hearing follow the applications have a patient-centric infrastructure and enabling infrastructure that's going to be available to enable the apps to basically run DevOps and or create infrastructure so so what are you guys doing let's talk what's the innovation strategy around the around the enable in the middle of the stack because VMworld VMware can't get to the top of the stack and innovate until they fix the middle of the stack which is performance availability but enabling apps flash seems to really sit beautifully for the apps it's like a memory tier it's not also you can put if a disk so what are you guys doing in that area what can you talk about photos whatever we can do to make it seamless so people enjoy using the emotion what we can do to enjoy so that seamless for B motion I mentioned Oracle RAC before one thing I'd like to do is in my in my past we enjoyed seeing VM win I think Pat went through the slides before where VMware has get to a point there's more virtual servers in place than physical servers I think what three four years ago it went about 50 percent Moritz Zion okay thank you so what we need to do in the value we provide to our OEM partners and our end users that last twenty five percent so even the most proficient virtualized customer out there they need that lasting hooda to get their Tier one critical applications fully virtualized and it gets one of the mantas that know Carlos talk with us pat was talking about this flash technology is gets the mission-critical applications so they can be virtualized as well because I think this whole robust environment here twenty two thousand people would benefit if it was a hundred percent versus a final question for you we were up on time here can did you guys I've got great growth what's next what's around the corner can you just give us a peek around the corner for you guys you mentioned messaging some some new messaging that might be come around but what else is what's gonna be new for you guys well thank you for acknowledging so it's leading the flash platform transformation September 10th to see a big announcement of our channel ecosystem I appreciate that you will see denser cards but more importantly we're investing all we can in our saw where we want to lead that flash platformer transformation you will see future releases about different availability as far as card management and other sophisticated ways so we can make it seamless as you're used to running your Sam but for a flash network flash network so having that fabric in place and again work its addicting work in microseconds the fact that the product in bring in 50 microseconds versus a familiarity we used to have around four to ten milliseconds people gonna like me post into the applications consumer side and it's exciting time for us for the growth potential new customers that might not know Veera didn't explain to them real quick we'll give you the final word of the segment why you've helped other customers that might be like them and what should they know about Bearden we'll wrap it up okay great on your third generation applications you might out there a sequel a new database that might be in place there it is exactly your choice to put out there it will give the speed you need that's out there in the familiarity of actually having the data services around our software flash math connect if you have an existing second-generation application that you'd like to get end-of-life or a little more kick out of it on a midlife kicker whether it be Oracle s ap we even have a huge use case and one of the largest companies in China just put in through an exchange environment that's a great use case as well so today's performance next generation tech performance but familiarity of data services that you've been around for 15 20 years and that's why I think we're leading the flash on the transformation so thank you Ken that's awesome flash as hot as I always tell Dave and I was talking about it under the hood is the engine of innovation the apps are what's driving the car all the instrumentation is there with Big Data and flash is a big part of it congratulations new sets and watch mirrored in we're gonna be watching you guys be written inside the cube this is Jon and Dave here we'll be right back with our next guest after this short break

welcome back to vmworld live 2010 live at the cube in san francisco california Moscone Center at vmworld 2010 please welcome this morning's press conference with VM ware compelling technologies and their customers Heineken from the Netherlands speaking today our Todd is Todd Nielsen's chief operating officer of VMware Phil sore and CEO of Compellent technologies and from Heineken the Netherlands microbrews virtualization team lead lucien de konak project manager and now please welcome Todd Nielsen the chief operating officer of VMware it's a it's great to be here we'd like to welcome you to the Compellent vmware operands and i want to say a couple words about compelling technologies in our partnership with them as vmware they've been a great storage partner of ours have a number of customers together a number and we really like work with them to drive value to our overall customer the solution said the that we did announced yesterday at vmware at vm for every dollar of license revenue that vmware cells we are partners or our ecosystem is able to add on or to drag with that fifteen dollars of ecosystem revenue and the compellent folks are a great example of a partnership with vmware where our solutions work well together and we do some exciting things we're going to hear from for the president and CEO of compellent and one of their customers but before we do one of my favorites twist of this press conference is a differentiation of compellent is the fluid data architecture and I think it's somewhat ironic after last night's beer crawls at vmworld 2010 that Heineken happens to be the customer on stage so I'm sure there's a story there and I would like to introduce Phil Soren the president and CEO of compellent to tell us about the company and about the Heineken beer crawls great Todd thanks a lot we're just thrilled to be up here on stage with you being participated in the fantastic show you have in operation here at moscone in San Francisco and we're thrilled to have a joint announcement our customer heineken here and to have them for from the Netherlands to share the excitement with us but let me tell you a little about Compellent we're a data storage company with the fluid data architecture we've been really the innovator if you look at primary storage innovation over the last decade things like thin provisioning sub lund automated tiered storage tiering disk platters flexible volumes portable volumes then provision you look at all those types of innovations over the last decade that storages come out and compellent has been the leader in that whole space and I think we'd be able to get ahead of some of the incumbent vendors with our innovation and we're in really fast growing we grew about thirty eight percent year-over-year last year we're the one of the fastest growing sandbenders in the world and we're hoping to keep that growing about 2,100 customers in 34 countries Heineken being a good example in the Netherlands of those customers there they're running their mission-critical enterprise applications on us for their worldwide operations and I would say of the 2100 about 2090 of them are also running some form of VMware so this partnership with vmware is very very important to us and we're real excited about it talk a little bit about our patented technology we call it the fluid data architecture and we thought no better customer to do a joint press conference with on our fluid data architecture than Heineken so the ultimate fluid data architecture is the combination of heineken and compellent and our system is so easy to use that you can actually enjoy a Heineken while you're about storage administrator so we like that they're so Heineken Nell lenders are our customer we have microbrews in Lushan nakonec and we're real excited to hear about their story they're part of a global enterprise of customers we talked about we have customers in all industries verticals geographic areas we're announcing actually this week we're announcing our expansion of our Australian operations where we have dozens of customers already but we're now seeing the expanse of our Australian operations and now let's take it back to the Netherlands and let's hear a real customer story about how vmware Compellent can really cut the the total cost of ownership in a data center by more than fifty percent with the combination of our two efforts and also improve the operational efficiency of those data centers and let's hear Mike and Lucien to tell us a little bit about it okay thank you very much feel I guess I don't have to introduce any cancer company itself because we all know with the core business or for companies brewing beer not only the beer we grade to brew great beers and great brands and that makes us the number one brewer in Europe and the number three in volume in the complete worldwide we have over 200 regional and local beers and ciders in total and when we look at our breweries we have almost in every country we have a brewery or its Hank is deliverable when we look at the International Anakin international we're very large company almost in every country as I just said before and we have 130 140 breweries in more than 70 countries which is good for a group beer volume of 200 million hectoliters of beer a year as includes insiders when we look at the the Netherlands we have only three breweries that's where it all started we have 18 million hectoliters of total supply but we're not drinking at all ourselves the domestic market is only about five million hectoliters and the rest of the volume is going to USA so as all export for us and that's where all your beers coming from and I strategies that we've introduced a Heineken Light several years ago is especially made for the USA market because we don't drink it okay when we take a look at the virtualization roadmap for hanukkah we started about six years ago in 2004 VMware was the only real player in the market at the moment we introduced it when we were consolidating our data centers in our main location suit about we came from about 12 server rooms to one major data center which we used storage from HP at the moment and we used HP blades infrastructure and we decided to go for it with VMware for our DTI environments or the test and acceptance environment after several years it we grew outgrew our storage capacity and we needed to upgrade so we we change te va with a forklift upgrade some to another EPA and we also introduced a new version of vmware again we're later we thought everybody was ready to go to use protection so everyone used the dta and i was confident it should work on production also so we start with the bronze service that our servers are not mission critical for us those are great success and last year we start a new project to virtualize every gold and silver system we have that means every mission critical and priority system we use for brewing packaging and distribution just the latest news is that last weekend we migrated one of the last warehouse management systems there's also virtualized now and is running perfectly where are we going we are looking at the end of the year we're going to vsphere for of course the main thing and last year we decided to choose for another storage storage solution we chose component well this is something where elution comes in you can tell about the choice you ate and why we did it okay thank you well well tell you something about the project itself the migration and why we choose component in the first place well we really needed to look for other solutions because especially in the two main sites suta wild and divorce we had some serious problems especially the support costs because after three years you pay an enormous amount of money for support from HB also we had our capacity problems and also experienced severe performance issues in suit about us so that meant that we had to take action fast also we had we were stuck on the AEV a 5000 which didn't allow us to upgrade to a newer version of vmware and also we couldn't use windows server 2008 which was very high on us on our priority list furthermore business continuity is on a plan for early next year so we wanted to have a solution which could provide us that and also because heineken is as called a new but it's not really a project but Sequoia the hunt for cash within itn Anakin element meant that we we want to you reduce IT costs as much as possible so in another point problem was that we had a major issue with reporting from our currents and infrastructure why did you choose for component well it opera it operates with every operating system it is very very important it's one for the solution that fits really everything that's what we experience as well during the migration we could start with replication early next year that's also very important and we needed a high high performance solution but it eventually meant why we choose chose for a component that it's excellent value for money the fluid data concept we really was consecrated what we can can use and give us high flexibility and one of the major pros is that the accident reporting facilities is I've never seen a better reporting functionality inside a project such as propellant and what is also very important that we got 24 7 proactive support and that's something you will never get for free so okay well as a result we have at least certain sixty percent virtualized and actually like my except last week we went to 61 percent because we virtualize to more FM machines and the speed we are going now it it really looks that we are in 2012 we are going to for ninety percent and I think it's a really feasible the number of disks we significantly reduced which meant lowers I decided lower on the power lower on low on the rec space for example the evi 5000 cost us one and a half 19-inch rack and right now it's about 12 views so it's a real big difference the performance we see on all layers not only on the only windows servers also on ax systems we see an enormous improvement regarding performance with yet we did have to do some optimization but with the support of copilot in the in the last month we had a excellent result and we even have a much better performance that we ever had so and because yeah we are finally using solar state drives because we really needed that for a sequel a reporting server which is very business critical and indio on the old evi we reached performance for about twenty thirty five minutes for a report which needed to be ready before a certain time and now we even cut times under 20 minutes so you see how fast it really is so we are next week actually the final and virtual machine will be migrated from the OTV a two component and that will finalize our migration on both breweries and so far no disruption whatsoever so we're very pleased perfect so that's a that's our part of the presentation thank you somebody talks out of the sky now right any questions uh well the question the question was with all the savings he's gotten his data center can you lower the cost of heineken beer for everyone I knew a new kind of heineken light right yeah how we go do that let us not up to me we really want to thank you guys for sharing that story I mean it just hit all our bullets about you know the future built in performance flexibility fluid data VMware compellent working together and we're just really really excited and we appreciate you sharing your story with our viewers and our customers and our prospects out in the audience here okay thank you guys yeah okay