>> Announcer: From the Cube's studios in Palo Alto in Boston, bringing you data-driven insights from The Cube and ETR. This is "Breaking Analysis" with Dave Vellante. >> Exactly one week after Pat Gelsinger's announcement of his plans to reinvent Intel. Arm announced version nine of its architecture and laid out its vision for the next decade. We believe this vision is extremely strong as it combines an end-to-end capability from Edge to Cloud, to the data center, to the home and everything in between. Arms aspirations are ambitious and powerful. Leveraging its business model, ecosystem and software compatibility with previous generations. Hello every one and welcome to this week's Wikibon Cube Insights powered by ETR. And this breaking analysis will explain why we think this announcement is so important and what it means for Intel and the broader technology landscape. We'll also share with you some feedback that we received from the Cube Community on last week's episode and a little inside baseball on how Intel, IBM, Samsung, TSMC and the U.S. government might be thinking about the shifting landscape of semiconductor technology. Now, there were two notable announcements this week that were directly related to Intel's announcement of March 23rd. The Armv9 news and TSMC's plans to invest a $100 billion in chip manufacturing and development over the next three years. That is a big number. It appears to tramp Intel's plan $20 billion investment to launch two new fabs in the U.S. starting in 2024. You may remember back in 2019, Samsung pledged to invest a $116 billion to diversify its production beyond memory trip, memory chips. Why are all these companies getting so aggressive? And won't this cause a glut in chips? Well, first, China looms large and aims to dominate its local markets, which in turn is going to confer advantages globally. The second, there's a huge chip shortage right now. And the belief is that it's going to continue through the decade and possibly beyond. We are seeing a new inflection point in the demand as we discussed last week. Stemming from digital, IOT, cloud, autos in new use cases in the home as so well presented by Sarjeet Johal in our community. As to the glut, these manufacturers believe that demand will outstrip supply indefinitely. And I understand that a lack of manufacturing capacity is actually more deadly than an oversupply. Look, if there's a glut, manufacturers can cut production and take the financial hit. Whereas capacity constraints mean you can miss entire cycles of growth and really miss out on the demand and the cost reductions. So, all these manufacturers are going for it. Now let's talk about Arm, its approach and the announcements that it made this week. Now last week, we talked about how Pat Gelsinger his vision of a system on package was an attempt to leapfrog system on chip SOC, while Arm is taking a similar system approach. But in our view, it's even broader than the vision laid out by Pat at Intel. Arm is targeting a wide variety of use cases that are shown here. Arm's fundamental philosophy is that the future will require highly specialized chips and Intel as you recall from Pat's announcement, would agree. But Arm historically takes an ecosystem approach that is different from Intel's model. Arm is all about enabling the production of specialized chips to really fit a specific application. For example, think about the amount of AI going on iPhones. They move if I remember from fingerprint to face recognition. This requires specialized neural processing units, NPUs that are designed by Apple for that particular use case. Arm is facilitating the creation of these specialized chips to be designed and produced by the ecosystem. Intel on the other hand has historically taken a one size fits all approach. Built around the x86. The Intel's design has always been about improving the processor. For example, in terms of speed, density, adding vector processing to accommodate AI, et cetera. And Intel does all the design and the manufacturing in any specialization for the ecosystem is done by Intel. Much of the value, that's added from the ecosystem is frankly been bending metal or adding displays or other features at the margin. But, the advantage is that the x86 architecture is well understood. It's consistent, reliable, and let's face it. Most enterprise software runs on x86. So, but very, very different models historically, which we heard from Gelsinger last week they're going to change with a new trusted foundry strategy. Now let's go through an example that might help explain the power of Arm's model. Let's say, your AWS and you're doing graviton. Designing graviton and graviton2. Or Apple, designing the M1 chip, or Tesla designing its own chip, or any other company in in any one of these use cases that are shown here. Tesla is a really good example. In order to optimize for video processing, Tesla needed to add specialized code firmware in the NPU for it's specific use case within autos. It was happy to take off the shelf CPU or GPU or whatever, and leverage Arm's standards there. And then it added its own value in the NPU. So the advantage of this model is Tesla could go from tape out in less or, or, or or in less than a year versus get the tape out in less than a year versus what would normally take many years. Arm is, think of Arm is like customize a Lego blocks that enable unique value add by the ecosystem with a much faster time to market. So like I say, the Tesla goes from logical tape out if you will, to Samsung and then says, okay run this against your manufacturing process. And it should all work as advertised by Arm. Tesla, interestingly, just as an aside chose the 14 nanometer process to keep its costs down. It didn't need the latest and greatest density. Okay, so you can see big difference in philosophies historically between Arm and Intel. And you can see Intel vectoring toward the Arm model based on what Gelsinger said last week for its foundry business. Essentially it has to. Now, Arm announced a new Arm architecture, Armv9. v9 is backwards compatible with previous generations. Perhaps Arm learned from Intel's failed, Itanium effort for those remember that word. Had no backward compatibility and it really floundered. As well, Arm adds some additional capabilities. And today we're going to focus on the two areas that have highlighted, machine learning piece and security. I'll take note of the call out, 300 billion chips. That's Arm's vision. That's a lot. And we've said, before, Arm's way for volumes are 10X those of x86. Volume, we sound like a broken record. Volume equals cost reduction. We'll come back to that a little bit later. Now let's have a word on AI and machine learning. Arm is betting on AI and ML. Big as are many others. And this chart really shows why, it's a graphic that shows ETR data and spending momentum and pervasiveness in the dataset across all the different sectors that ETR tracks within its taxonomy. Note that ML/AI gets the top spot on the vertical axis, which represents net score. That's a measure of spending momentum or spending velocity. The horizontal axis is market share presence in the dataset. And we give this sector four stars to signify it's consistent lead in the data. So pretty reasonable bet by Arm. But the other area that we're going to talk about is security. And its vision day, Arm talked about confidential compute architecture and these things called realms. Note in the left-hand side, showing data traveling all over the different use cases and around the world and the call-out from the CISO below, it's a large public airline CISO that spoke at an ETR Venn round table. And this individual noted that the shifting end points increase the threat vectors. We all know that. Arm said something that really resonated. Specifically, they said today, there's far too much trust on the OS and the hypervisor that are running these applications. And their broad access to data is a weakness. Arm's concept of realms as shown in the right-hand side, underscores the company strategy to remove the assumption that privileged software. Like the hypervisor needs to be able to see the data. So by creating realms, in a virtualized multi-tenant environment, data can be more protected from memory leaks which of course is a major opportunity for hackers that they exploit. So it's a nice concept in a way for the system to isolate attendance data from other users. Okay, we want, we want to share some feedback that we got last week from the community on our analysis of Intel. A tech exec from city pointed out that, Intel really didn't miss a mobile, as we said, it really missed smartphones. In fact, whell, this is a kind of a minor distinction, it's important to recognize we think. Because Intel facilitated WIFI with Centrino, under the direction of Paul Alini. Who by the way, was not an engineer. I think he was the first non-engineer to be the CEO of Intel. He was a marketing person by background. Ironically, Intel's work in wifi connectivity enabled, actually enabled the smartphone revolution. And maybe that makes the smartphone missed by Intel all that more egregious, I don't know. Now the other piece of feedback we received related to our IBM scenario and our three-way joint venture prediction bringing together Intel, IBM, and Samsung in a triumvirate where Intel brings the foundry and it's process manufacturing. IBM brings its dis-aggregated memory technology and Samsung brings its its volume and its knowledge of of volume down the learning curve. Let's start with IBM. Remember we said that IBM with power 10 has the best technology in terms of this notion of dis-aggregating compute from memory and sharing memory in a pool across different processor types. So a few things in this regard, IBM when it restructured its micro electronics business under Ginni Rometty, catalyzed the partnership with global foundries and you know, this picture in the upper right it shows the global foundries facility outside of Albany, New York in Malta. And the partnership included AMD and Samsung. But we believe that global foundries is backed away from some of its contractual commitments with IBM causing a bit of a rift between the companies and leaving a hole in your original strategy. And evidently AMD hasn't really leaned in to move the needle in any way and so the New York foundry, is it a bit of a state of limbo with respect to its original vision. Now, well, Arvind Krishna was the face of the Intel announcement. It clearly has deep knowledge of IBM semiconductor strategy. Dario Gill, we think is a key player in the mix. He's the senior vice president director of IBM research. And it is in a position to affect some knowledge sharing and maybe even knowledge transfer with Intel possibly as it relates to disaggregated architecture. His questions remain as to how open IBM will be. And how protected it will be with its IP. It's got, as we said, last week, it's got to have an incentive to do so. Now why would IBM do that? Well, it wants to compete more effectively with VMware who has done a great job leveraging x86 and that's the biggest competitor in threat to open shift. So Arvind needs Intel chips to really execute on IBM's cloud strategy. Because almost all of IBM's customers are running apps on x86. So IBM's cloud and hybrid cloud. Strategy really need to leverage that Intel partnership. Now Intel for its part has great FinFET technology. FinFET is a tactic goes beyond CMOs. You all mainframes might remember when IBM burned the boat on ECL, Emitter-coupled Logic. And then moved to CMOs for its mainframes. Well, this is the next gen beyond, and it could give Intel a leg up on AMD's chiplet intellectual properties. Especially as it relates to latency. And there could be some benefits there for IBM. So maybe there's a quid pro quo going on. Now, where it really gets interesting is New York Senator, Chuck Schumer, is keen on building up an alternative to Silicon Valley in New York now it is Silicon Alley. So it's possible that Intel, who by the way has really good process technology. This is an aside, it really allowed TSMC to run the table with the whole seven nanometers versus 10 minute nanometer narrative. TSMC was at seven nanometer. Intel was at 10 nanometer. And really, we've said in the past that Intel's 10 nanometer tech is pretty close to TSMC seven. So Intel's ahead in that regard, even though in terms of, you know, the intervener thickness density, it's it's not, you know. These are sort of games that the semiconductor companies play, but you know it's possible that Intel with the U.S. government and IBM and Samsung could make a play for that New York foundry as part of Intel's trusted foundry strategy and kind of reshuffle that deck in Albany. Sounds like a "Game of Thrones," doesn't it? By the way, TSMC has been so consumed servicing Apple for five nanometer and eventually four nanometer that it's dropped the ball on some of its other's customers, namely Nvidia. And remember, a long-term competitiveness and cost reductions, they all come down to volume. And we think that Intel can't get to volume without an Arm strategy. Okay, so maybe the JV, the Joint Venture that we talked about, maybe we're out on a limb there and that's a stretch. And perhaps Samsung's not willing to play ball, given it's made huge investments in fabs and infrastructure and other resources, locally, but we think it's still viable scenario because we think Samsung definitely would covet a presence in the United States. No good to do that directly but maybe a partnership makes more sense in terms of gaining ground on TSMC. But anyway, let's say Intel can become a trusted foundry with the help of IBM and the U.S. government. Maybe then it could compete on volume. Well, how would that work? Well, let's say Nvidia, let's say they're not too happy with TSMC. Maybe with entertain Intel as a second source. Would that do it? In and of itself, no. But what about AWS and Google and Facebook? Maybe this is a way to placate the U.S. government and call off the antitrust dogs. Hey, we'll give Intel Foundry our business to secure America's semiconductor leadership and future and pay U.S. government. Why don't you chill out, back off a little bit. Microsoft even though, you know, it's not getting as much scrutiny from the U.S. government, it's anti trustee is maybe perhaps are behind it, who knows. But I think Microsoft would be happy to play ball as well. Now, would this give Intel a competitive volume posture? Yes, we think it would, for sure. If it can gain the trust of these companies and the volume we think would be there. But as we've said, currently, this is a very, very long shot because of the, the, the new strategy, the distance the difference in the Foundry business all those challenges that we laid out last week, it's going to take years to play out. But the dots are starting to connect in this scenario and the stakes are exceedingly high hence the importance of the U.S. government. Okay, that's it for now. Thanks to the community for your comments and insights. And thanks again to David Floyer whose analysis around Arm and semiconductors. And this work that he's done for the past decade is of tremendous help. Remember I publish each week on wikibon.com and siliconangle.com. And these episodes are all available as podcasts, just search for braking analysis podcast and you can always connect on Twitter. You can hit the chat right here or this live event or email me at david.vellante@siliconangle.com. Look, I always appreciate the comments on LinkedIn and Clubhouse. You can follow me so you're notified when we start a room and riff on these topics as well as others. And don't forget to check out etr.plus where all the survey data. This is Dave Vellante for the Cube Insights powered by ETR. Be well, and we'll see you next time. (cheerful music) (cheerful music)

>> From the Cube's studios in Palo Alto in Boston, bringing you data-driven insights from The Cube and ETR. This is "Breaking Analysis" with Dave Vellante. >> Exactly one week after Pat Gelsinger's announcement of his plans to reinvent Intel. Arm announced version nine of its architecture and laid out its vision for the next decade. We believe this vision is extremely strong as it combines an end-to-end capability from Edge to Cloud, to the data center, to the home and everything in between. Arms aspirations are ambitious and powerful. Leveraging its business model, ecosystem and software compatibility with previous generations. Hello every one and welcome to this week's Wikibon Cube Insights powered by ETR. And this breaking analysis will explain why we think this announcement is so important and what it means for Intel and the broader technology landscape. We'll also share with you some feedback that we received from the Cube Community on last week's episode and a little inside baseball on how Intel, IBM, Samsung, TSMC and the U.S. government might be thinking about the shifting landscape of semiconductor technology. Now, there were two notable announcements this week that were directly related to Intel's announcement of March 23rd. The Armv9 news and TSMC's plans to invest a $100 billion in chip manufacturing and development over the next three years. That is a big number. It appears to tramp Intel's plan $20 billion investment to launch two new fabs in the U.S. starting in 2024. You may remember back in 2019, Samsung pledged to invest a $116 billion to diversify its production beyond memory trip, memory chips. Why are all these companies getting so aggressive? And won't this cause a glut in chips? Well, first, China looms large and aims to dominate its local markets, which in turn is going to confer advantages globally. The second, there's a huge chip shortage right now. And the belief is that it's going to continue through the decade and possibly beyond. We are seeing a new inflection point in the demand as we discussed last week. Stemming from digital, IOT, cloud, autos in new use cases in the home as so well presented by Sarjeet Johal in our community. As to the glut, these manufacturers believe that demand will outstrip supply indefinitely. And I understand that a lack of manufacturing capacity is actually more deadly than an oversupply. Look, if there's a glut, manufacturers can cut production and take the financial hit. Whereas capacity constraints mean you can miss entire cycles of growth and really miss out on the demand and the cost reductions. So, all these manufacturers are going for it. Now let's talk about Arm, its approach and the announcements that it made this week. Now last week, we talked about how Pat Gelsinger his vision of a system on package was an attempt to leapfrog system on chip SOC, while Arm is taking a similar system approach. But in our view, it's even broader than the vision laid out by Pat at Intel. Arm is targeting a wide variety of use cases that are shown here. Arm's fundamental philosophy is that the future will require highly specialized chips and Intel as you recall from Pat's announcement, would agree. But Arm historically takes an ecosystem approach that is different from Intel's model. Arm is all about enabling the production of specialized chips to really fit a specific application. For example, think about the amount of AI going on iPhones. They move if I remember from fingerprint to face recognition. This requires specialized neural processing units, NPUs that are designed by Apple for that particular use case. Arm is facilitating the creation of these specialized chips to be designed and produced by the ecosystem. Intel on the other hand has historically taken a one size fits all approach. Built around the x86. The Intel's design has always been about improving the processor. For example, in terms of speed, density, adding vector processing to accommodate AI, et cetera. And Intel does all the design and the manufacturing in any specialization for the ecosystem is done by Intel. Much of the value, that's added from the ecosystem is frankly been bending metal or adding displays or other features at the margin. But, the advantage is that the x86 architecture is well understood. It's consistent, reliable, and let's face it. Most enterprise software runs on x86. So, but very, very different models historically, which we heard from Gelsinger last week they're going to change with a new trusted foundry strategy. Now let's go through an example that might help explain the power of Arm's model. Let's say, your AWS and you're doing graviton. Designing graviton and graviton2. Or Apple, designing the M1 chip, or Tesla designing its own chip, or any other company in in any one of these use cases that are shown here. Tesla is a really good example. In order to optimize for video processing, Tesla needed to add specialized code firmware in the NPU for it's specific use case within autos. It was happy to take off the shelf CPU or GPU or whatever, and leverage Arm's standards there. And then it added its own value in the NPU. So the advantage of this model is Tesla could go from tape out in less or, or, or or in less than a year versus get the tape out in less than a year versus what would normally take many years. Arm is, think of Arm is like customize a Lego blocks that enable unique value add by the ecosystem with a much faster time to market. So like I say, the Tesla goes from logical tape out if you will, to Samsung and then says, okay run this against your manufacturing process. And it should all work as advertised by Arm. Tesla, interestingly, just as an aside chose the 14 nanometer process to keep its costs down. It didn't need the latest and greatest density. Okay, so you can see big difference in philosophies historically between Arm and Intel. And you can see Intel vectoring toward the Arm model based on what Gelsinger said last week for its foundry business. Essentially it has to. Now, Arm announced a new Arm architecture, Armv9. v9 is backwards compatible with previous generations. Perhaps Arm learned from Intel's failed, Itanium effort for those remember that word. Had no backward compatibility and it really floundered. As well, Arm adds some additional capabilities. And today we're going to focus on the two areas that have highlighted, machine learning piece and security. I'll take note of the call out, 300 billion chips. That's Arm's vision. That's a lot. And we've said, before, Arm's way for volumes are 10X those of x86. Volume, we sound like a broken record. Volume equals cost reduction. We'll come back to that a little bit later. Now let's have a word on AI and machine learning. Arm is betting on AI and ML. Big as are many others. And this chart really shows why, it's a graphic that shows ETR data and spending momentum and pervasiveness in the dataset across all the different sectors that ETR tracks within its taxonomy. Note that ML/AI gets the top spot on the vertical axis, which represents net score. That's a measure of spending momentum or spending velocity. The horizontal axis is market share presence in the dataset. And we give this sector four stars to signify it's consistent lead in the data. So pretty reasonable bet by Arm. But the other area that we're going to talk about is security. And its vision day, Arm talked about confidential compute architecture and these things called realms. Note in the left-hand side, showing data traveling all over the different use cases and around the world and the call-out from the CISO below, it's a large public airline CISO that spoke at an ETR Venn round table. And this individual noted that the shifting end points increase the threat vectors. We all know that. Arm said something that really resonated. Specifically, they said today, there's far too much trust on the OS and the hypervisor that are running these applications. And their broad access to data is a weakness. Arm's concept of realms as shown in the right-hand side, underscores the company strategy to remove the assumption that privileged software. Like the hypervisor needs to be able to see the data. So by creating realms, in a virtualized multi-tenant environment, data can be more protected from memory leaks which of course is a major opportunity for hackers that they exploit. So it's a nice concept in a way for the system to isolate attendance data from other users. Okay, we want, we want to share some feedback that we got last week from the community on our analysis of Intel. A tech exec from city pointed out that, Intel really didn't miss a mobile, as we said, it really missed smartphones. In fact, whell, this is a kind of a minor distinction, it's important to recognize we think. Because Intel facilitated WIFI with Centrino, under the direction of Paul Alini. Who by the way, was not an engineer. I think he was the first non-engineer to be the CEO of Intel. He was a marketing person by background. Ironically, Intel's work in wifi connectivity enabled, actually enabled the smartphone revolution. And maybe that makes the smartphone missed by Intel all that more egregious, I don't know. Now the other piece of feedback we received related to our IBM scenario and our three-way joint venture prediction bringing together Intel, IBM, and Samsung in a triumvirate where Intel brings the foundry and it's process manufacturing. IBM brings its dis-aggregated memory technology and Samsung brings its its volume and its knowledge of of volume down the learning curve. Let's start with IBM. Remember we said that IBM with power 10 has the best technology in terms of this notion of dis-aggregating compute from memory and sharing memory in a pool across different processor types. So a few things in this regard, IBM when it restructured its micro electronics business under Ginni Rometty, catalyzed the partnership with global foundries and you know, this picture in the upper right it shows the global foundries facility outside of Albany, New York in Malta. And the partnership included AMD and Samsung. But we believe that global foundries is backed away from some of its contractual commitments with IBM causing a bit of a rift between the companies and leaving a hole in your original strategy. And evidently AMD hasn't really leaned in to move the needle in any way and so the New York foundry, is it a bit of a state of limbo with respect to its original vision. Now, well, Arvind Krishna was the face of the Intel announcement. It clearly has deep knowledge of IBM semiconductor strategy. Dario Gill, we think is a key player in the mix. He's the senior vice president director of IBM research. And it is in a position to affect some knowledge sharing and maybe even knowledge transfer with Intel possibly as it relates to disaggregated architecture. His questions remain as to how open IBM will be. And how protected it will be with its IP. It's got, as we said, last week, it's got to have an incentive to do so. Now why would IBM do that? Well, it wants to compete more effectively with VMware who has done a great job leveraging x86 and that's the biggest competitor in threat to open shift. So Arvind needs Intel chips to really execute on IBM's cloud strategy. Because almost all of IBM's customers are running apps on x86. So IBM's cloud and hybrid cloud. Strategy really need to leverage that Intel partnership. Now Intel for its part has great FinFET technology. FinFET is a tactic goes beyond CMOs. You all mainframes might remember when IBM burned the boat on ECL, Emitter-coupled Logic. And then moved to CMOs for its mainframes. Well, this is the next gen beyond, and it could give Intel a leg up on AMD's chiplet intellectual properties. Especially as it relates to latency. And there could be some benefits there for IBM. So maybe there's a quid pro quo going on. Now, where it really gets interesting is New York Senator, Chuck Schumer, is keen on building up an alternative to Silicon Valley in New York now it is Silicon Alley. So it's possible that Intel, who by the way has really good process technology. This is an aside, it really allowed TSMC to run the table with the whole seven nanometers versus 10 minute nanometer narrative. TSMC was at seven nanometer. Intel was at 10 nanometer. And really, we've said in the past that Intel's 10 nanometer tech is pretty close to TSMC seven. So Intel's ahead in that regard, even though in terms of, you know, the intervener thickness density, it's it's not, you know. These are sort of games that the semiconductor companies play, but you know it's possible that Intel with the U.S. government and IBM and Samsung could make a play for that New York foundry as part of Intel's trusted foundry strategy and kind of reshuffle that deck in Albany. Sounds like a "Game of Thrones," doesn't it? By the way, TSMC has been so consumed servicing Apple for five nanometer and eventually four nanometer that it's dropped the ball on some of its other's customers, namely Nvidia. And remember, a long-term competitiveness and cost reductions, they all come down to volume. And we think that Intel can't get to volume without an Arm strategy. Okay, so maybe the JV, the Joint Venture that we talked about, maybe we're out on a limb there and that's a stretch. And perhaps Samsung's not willing to play ball, given it's made huge investments in fabs and infrastructure and other resources, locally, but we think it's still viable scenario because we think Samsung definitely would covet a presence in the United States. No good to do that directly but maybe a partnership makes more sense in terms of gaining ground on TSMC. But anyway, let's say Intel can become a trusted foundry with the help of IBM and the U.S. government. Maybe then it could compete on volume. Well, how would that work? Well, let's say Nvidia, let's say they're not too happy with TSMC. Maybe with entertain Intel as a second source. Would that do it? In and of itself, no. But what about AWS and Google and Facebook? Maybe this is a way to placate the U.S. government and call off the antitrust dogs. Hey, we'll give Intel Foundry our business to secure America's semiconductor leadership and future and pay U.S. government. Why don't you chill out, back off a little bit. Microsoft even though, you know, it's not getting as much scrutiny from the U.S. government, it's anti trustee is maybe perhaps are behind it, who knows. But I think Microsoft would be happy to play ball as well. Now, would this give Intel a competitive volume posture? Yes, we think it would, for sure. If it can gain the trust of these companies and the volume we think would be there. But as we've said, currently, this is a very, very long shot because of the, the, the new strategy, the distance the difference in the Foundry business all those challenges that we laid out last week, it's going to take years to play out. But the dots are starting to connect in this scenario and the stakes are exceedingly high hence the importance of the U.S. government. Okay, that's it for now. Thanks to the community for your comments and insights. And thanks again to David Floyer whose analysis around Arm and semiconductors. And this work that he's done for the past decade is of tremendous help. Remember I publish each week on wikibon.com and siliconangle.com. And these episodes are all available as podcasts, just search for braking analysis podcast and you can always connect on Twitter. You can hit the chat right here or this live event or email me at david.vellante@siliconangle.com. Look, I always appreciate the comments on LinkedIn and Clubhouse. You can follow me so you're notified when we start a room and riff on these topics as well as others. And don't forget to check out etr.plus where all the survey data. This is Dave Vellante for the Cube Insights powered by ETR. Be well, and we'll see you next time. (cheerful music) (cheerful music)

from Austin Texas it's the cube covering cube con and cloud native con 2017 brought to you by Red Hat the Lenox foundations and the cubes ecosystem partners well everyone welcome back to our exclusive coverage from the cube here in Austin Texas we're live on the floor at cloud native con and cube con cubic on like kubernetes gone not the cube con us but cute con we're Michele norelli who's the senior software engineer at Microsoft also the co-chair with Kelsey Heights our great event record-setting attendance I'm John ferry your host with stew minimun Michele welcome to the cube thank you so much for having me so people don't know about if they might have watch the street if you had a stream you're on stage keynoting and managing the whole program here congratulations more attendees here at this event than all the other cube cause of cloud native combined shows the growth and interest in a new way to develop new way to engage with other developers and create value yeah kubernetes has been the heart of it explain cloud native con and cube con what's the difference because I love cloud native but what's this Cooper Denny's thing I love that too yeah was it related a intertwine Wayne take him into his plane there's a there's a really big kubernetes audience and community and they need time to engage and just like work with each other and learn from each other and that's where coop Connie came from soku-kun with the original conference and the first one was a November in Seattle in 2016 and I was actually at that wine was a few hundred people and it was just so small people were actually asking like what is a pod what is kubernetes which are fine questions asked today as well but it was everyone was asking this question nobody was past that point and then you know kubernetes was donated to the CNCs and there were also these other cloud native projects that came about in the space and so we wanted a conference that encompasses both all of the cloud native projects as well as serbs the kubernetes community as well so that's where both of them came from some of the other cloud native projects have their own conferences like Prometheus has prom time and that's been growing as well I think the last one was 200 people up from 70 the last so I gotta ask you because we even cover us we were there at the cube con I was actually having drinks with Luke Tucker at JJ we're like hey we should do this Cuban Eddie's thing and bolted onto the Linux Foundation so you're president creates with the whole team it's been fun to watch Wow yeah but it's the tale of two stories in the community in the industry companies that got funded and we're building open-source and our participants who are building projects out and then a new onboarding of new developers coming into the community a lot of first-timers here you're seeing a visibility into the success of cloud yeah and they're Rieger engaged so you got a lot of folks who have invested into the community and new entrants a migration into the community yeah what does that dynamic mean to the CN CF how is that impacting how you structure in the programming and what are some of the insiders talking about what it is what's the reality yeah I think a lot of it has to do with you know this is a really positive community and there are just like so many people working together and collaborating not just because they I mean it looks like nice to be in a positive community right but you kind of have to like these problems are really hard and it's good to learn from different organizations that have like come across these projects or problems starting in the in the space before and they'll come and collaborate I think some of the things that we've been talking about inside the community is how to actually how to onboard people so the kubernetes community is starting up a new mentorship program to help people that are new to the community start learning how to review code and then PR code and and be productive members in the community and whatever they whatever area they want miss Michelle want to hear about kind of some of the breadth and depth of the community here yeah you know we went there's so many announcements there's a bunch of wando's yeah it's a brand new project I think what it was four projects a year ago and it's now 14 you know right how does somebody's supposed to get their arms around it should they be beat me about that you know where should somebody start you know what do you recommend yeah start with the that's a great question by the way I think that people should start with with a solution to a problem they already have so just know that people have run into these problems before and you should just go into the thing that you know about first and then if that leads you to a different problem and there's a solution that the CNCs you know has already come across then you can go into and dive into the other palms for example I am really interested in kubernetes and have been in that space but I think tracing is really interesting too and I want to start learning how to incorporate that into my workflow as well so show you you're also one of the diversity chairs yeah for the event you talk about kind of a diverse global nature of this community yeah we are spread across all time zone so I actually want to share an experience I have as a sake lead in kubernetes so at first I really wanted to serve all of the time zones and so we have these weekly sick meetings at 9:30 a.m. Pacific and I was like no maybe we should have like alternate meetings like alternate weekly meetings for other time zones but after talking to those the people in the other time sounds like they're very far off actually like China Asia Pacific I realize that they're actually more interested in reading notes and watching videos which is something I didn't actually know you know it's it's you think like oh you have to serve every community in the same way but what I've learned and face to face yeah base to base exactly and that's not actually how that's not how actually everybody wants to interact and so that's been an interesting thing I've learned from the diverse nature and this in the space let's see a challenges I mean we've been talking we're just that reinvent last week at Amazon obviously the number of services that they're rolling out is pretty strong there's a leader in the cloud but as multi cloud becomes the choice for most most enterprises and businesses the service requirements the baseline is got to be established seeing your community rolling out a lot of great new services but storage old storage is transferring to machine learning in AI and you got I Oh tea right around the corner new new kinds of applications yeah okay it's changing the game on the old card storage and security obviously two important areas you got to store the data data is that the card of the value proposition and then security security how are you guys dealing with that those challenges those political grounds that people are have a lot of making a lot of money in an old storage you mean ship a storage drive and here's an architecture those are being disrupted yeah I think they I mean they'll continue to be disrupted I think people are just going to bring in new and new more new and new use cases and then people will come and meet them meet those customers where they are and people just have to change I guess get used to it yeah shifter die yeah I think that some that that we are getting to that point but I can't only time will tell we'll see what are something exciting things that you see from the new developers I just recognize some friends here that I've haven't that dark wondering the community are new and they're kind of like licking their chops like wow what an excitement I could feel value and I could have a distribution I got a community and I can make money and then Dan said you know project products profits you put the product profit motive right on the table but he's clear at the same not pay to play it's okay to have profits if you have a good product for me project I buy that but the new developers like that because as an end scoreboard what are you guys doing with that new community what survived there around those kinds of opportunities you guys creating any programs for them or yeah I think just to just they can get involved you know I think knowledge is power perspective is power also so being involved helps give you a perspective to see where those gaps are and then come up with those services that are profitable or those tools that are profitable and I think this space can be very lucrative based on the number of people he sponsors I think he said he said the show was wondering if you can comment when you're building the schedule how do you balance you know all those platinum sponsors versus you know some of the you know practitioner companies that are also getting involved how do you there are there are different levels of sponsorship right like you mentioned the events team has a sponsorship section or sponsorship team and they handle most of placing sponsors and all of that and so they'll get whatever level they want but actually Kelsey and I do a lot of research and see like what's happening in the community what's interesting what's new and and we'll find time to highlight that as well which one is research what's your role in Microsoft share with the audience what are you working on what's your day-to-day job is it just foundation work are you doing coding what do you coding what's your fav is the VI MX what do you prefer yes my work is 30% community and 70% engineering I really love engineering but I also really love the community and just getting these opportunities to give back you know build skills as well learning how to speak in front of people as well these are both valuable skills to learn and it gives me an opportunity to just give back what I've learned so I appreciate those but I mostly work on developer tools that are open source that help people use containers and kubernetes a little more easily so I work on projects like Helms drafts and Brigade and these are just like things that we've seen the pain points that we've experienced and we want to kind of share our solutions with them so draft is the one I've been working on a lot have you heard of drops okay let me do the two second draft is a tool for application developers to build containerized apps without really understanding or having to understand all of what is kubernetes and containers so that's my favorite space to know you know one of the things we look at coming in here is there's that balance between there's complexity but there's flexibility you know I've heard Kelsey talking about our on when I talk to customer they're like oh I love kubernetes because I take vault and I take envoy and I take all these different things that put together and it does what I want but a lot of people are daunted and they say oh I want to I want to just go to Microsoft Azure and they'll take care of that so how do you look at that and what is the balance that we should be looking for as an industry yeah we've been emphasizing in the community a lot on plug ability across contracts it's like a theme that I think almost every project hurts and a word that you'll hear a lot I'm sure you already have heard a lot and I think that's because you can't meet everyone's needs so you build this modular component that does one thing very well and then you learn how to extend it and or you give people the ability to extend it and so that's really great for scaling a project I I do really appreciate the clouds coming out all of them with their own managed services because it's hard to operate and understand all of these things it's it takes a lot of depth in knowledge context and just prior experience and so I think that'll just make it a lot easier for people to onboard onto these technologies I was going to ask you I was going to ask so you brought up fug ability we saw you know Netflix on stage was his phenomenal of the culture yeah dynamic I think that the Schumer important conversation you know something we've been talking about silage is a real part of what we're seeing tech being a part of but the the things that popped out at me in the keynote were service mesh and pluggable architecture so I want to get your thoughts for the folks that aren't there is that in the trenches and inside the ropes what is a pluggable architecture and what is a service mesh these days because you got lyft and uber and all these great companies who have built hyper scale and large-scale systems in open source and now our big tech success stories donating these kinds of approaches pluggable architectures and service man talk a minute to explain so pluggable architectures this is why you have one layer of your stuff there's a piece of software that does something does one thing very well but you know every I like to say that every company is a snowflake and that's okay and so you may have some workflow or need that is specific to your company and so we shouldn't limit you to just what we think is the right solution to a problem we should allow you to extend or extend these pieces of software with modular components or just extensible components that that work for you does that make a little more sense yeah I work on helm and we also have a pluggable architecture because we were just getting so many requests from the community and it didn't make sense to put everything in the core code based if we did if we accepted one thing it would really just interrupt somebody else's workflow so that that's helped us a lot in in my personal experience I really like plug water it's actually that means you can go build a really kick butt app yeah nail it down to your specifications but decoupler from a core or avoiding kind the old spaghetti code mindset but kind of creating a model where it can be leveraged yeah plugin we all know plugins are but right so so that someone else could take advantage of it exactly yeah a service mesh that's evolved yeah heard a lot of that what is that yeah it's um so developers this is actually the lift story is really interesting to me so at lyft developers were really uneasy about moving from the monolith to the micro-services architecture just because they didn't early understand the network component and we're like network reliability would not be so reliable would fail and time service meshes have allowed engineers at lyft to understand where their failures happen and in terms like of a network standpoint and so you're basically abstracting with network layer and allowing more transparency into it this is like very useful for when you have lots of Micra services and you want this kind of reliability and stability awesome so one point 9s coming Spence support Windows that's what key and now a congratulations just go to the next level I mean growth talk about the growth because it's fun for us to watch you know kind of a small group core young community less than three years old really to kubernetes kind of had some traction but it really is going to be commoditized and that's not a bad thing so how do you what's your take on this what's the vibe what's that what's the current feeling inside the community right now excited pinching ourselves no I think everybody's in awe everybody is in awe and we're just like we want to make this the best experience possible in terms of an open source experience you know we want to welcome people to the community we want to serve the people's needs and we just we just want to do a good job because this is really fun and I think the people working on these problems are having a lot of fun with with seeing this kind of growth and support it's been great certainly for US president creation president and creation of this whole movement it's been fun to watch a document final question what should people expect this week what is the show going to hopefully do what's your prediction what's your purpose here what should people expect this week and the folks that didn't make it what do they miss okay there are so many things happening it's insane you're going to get a little bit of everything there's lots of different tracks lots of diverse content I think I'm when I go to conferences in my personal experience I really love technical salons those are really great because you can get your hands dirty and you can get questions answered by the people who created the project that's an experience that is is really powerful for me I went to the first open tracing salon and that's where I kind of got my hands dirty with tracing and been siegelman who's doing the keynote today this afternoon was the person who was teaching me how to like do this stuff so yeah it was awesome like some marketing fluff no it's not and it's just like it's it's real experienced very expert like experts you know in the in the space teaching you these things so that that definitely can't be replicated I think the cig sessions will be really cool there's a big focus on not just learning stuff but also collaborating and and just talking about things before they get documented so that's a really good experience here it's an action-packed schedule I tweeted that it feels like I'm you know when Burning Man had like a hundred people announced this big thing I think this is the beginning of a amazing industry people are cool they're helpful they're getting you're getting involved answering questions open-book here yeah at cloud native Punk you've got thanks Michele Farrelly been coming on co-chair senior engineer at Microsoft great to have her on the cube great keynote great color great fun exciting times here at cloud native con I'm John furry the founders look at angle media with too many men my co-hosts more live coverage after the short break