(upbeat music) >> Welcome to theCube's continuous coverage of AWS re:Invent 2021. I'm Dave Nicholson, and we are running one of the industry's most important and largest hybrid tech events this year with AWS and its partners with two live sets on the scene. In addition to two remote studios. And we'll have somewhere in the neighborhood of a hundred guests on the program this year at re:Invent. I'm extremely delighted to welcome a very, very special guest. Right now. He served as the director of the NSA under two presidents, and was the first commander of the U.S Cyber Command. He's a Cube alumni, he's founder and co-CEO of IronNet Cybersecurity. General Keith Alexander. Thanks for joining us today General. >> Thanks, David. It's an honor to be here at re:Invent, you know, with AWS. All that they're doing and all they're making possible for us to defend sector states, companies and nations in cyber. So an honor to be here. >> Well, welcome back to theCube. Let's dive right in. I'd like to know how you would describe the current cyber threat landscape that we face. >> Well, I think it's growing. Well, let's start right out. You know, the good news or the bad news, the bad news is getting worse. We're seeing that. If you think about SolarWinds, you think about the Hafnium attacks on Microsoft. You think about this rapid growth in ransomware. We're seeing criminals and nation states engaging in ways that we've never seen in the past. It's more blatant. They're going after more quickly, they're using cyber as an element of national power. Let's break that down just a little bit. Do you go back to two, July. Xi Jinping, talked about breaking heads in bloodshed when he was referring to the United States and Taiwan. And this has gone hot and cold, that's a red line for him. They will do anything to keep Taiwan from breaking away. And this is a huge existential threat to us into the region. And when this comes up, they're going to use cyber to go after it. Perhaps even more important and closer right now is what's going on with Russia in the Donbas region of eastern Ukraine. We saw this in 2014, when Russia took over the Crimea. The way they did it, staging troops. They did that in 2008 against Georgia. And now there are, by some reports over a hundred thousand troops on the border of Eastern Ukraine. Some call it an exercise, but that's exactly what they did in Georgia. That's what they did in the Crimea. And in both those cases, they preceded those attacks, those physical attacks with cyber attacks. If you go to 2017, when Russia hit the Ukrainian government with the NotPetya attack that had global repercussions. Russia was responsible for SolarWinds, they have attacked our infrastructure to find out what our government is doing and they continue going. This is getting worse. You know, it's interesting when you think about, so what do you do about something like that? How do we stop that? And the answer is we've got to work together. You know, Its slam commissioner addressed it. The meeting with the president on August 25th. This is a great statement by the CEO and chairman of Southern Company, Tom Fanning. He said this, "the war is being waged on our nation's critical infrastructure in particular, our energy sector, our telecommunications sector and financial sector." The private sector owns and operates 87% of the critical infrastructure in the United States, making collaboration between industry and the federal government imperative too, for these attacks. SO >> General, I want to dig just a little bit on that point that you make for generations, people have understood that the term is 'kinetic war', right? Not everyone has heard that phrase, but for generations we've understood the concept of someone dropping a bomb on a building as being an attack. You've just mentioned that, that a lot of these attacks are directed towards the private sector. The private sector doesn't have an army to respond to those attacks. Number one, that's our government's responsibility. So the question I have is, how seriously are people taking these kinds of threats when compared to the threat of kinetic war? Because my gosh, you can take down the entire electrical grid now. That's not something you can do with a single bomb. What are your, what are your thoughts on that? >> So you're hitting on a key point, a theoretical and an operational point. If you look back, what's the intent of warfare? It's to get the mass of people to give up. The army protects the mass of people in that fight. In cyber, there's no protection. Our critical infrastructure is exposed to our adversaries. That's the problem that we face. And because it's exposed, we have a tremendous vulnerability. So those who wish us harm, imagine the Colonial Pipeline attack an order of magnitude or two orders of magnitude bigger. The impact on our country would paralyze much of what we do today. We are not ready for that. That's the issue that Tom Fanning and others have brought up. We don't practice between the public sector and the private sector working together to defend this country. We need to do that. That's the issue that we have to really get our hands around. And when we talk about practice, what do we mean? It means we have to let that federal government, the ones that are going to protect us, see what's going on. There is no radar picture. Now, since we're at re:Invent, the cloud, where AWS and others have done, is create an infrastructure that allows us to build that bridge between the public and private sector and scale it. It's amazing what we can now do. We couldn't do that when I was running Cyber Command. And running Cyber Command, we couldn't see threats on the government. And we couldn't see threats on critical infrastructure. We couldn't see threats on the private sector. And so it all went and all the government did was say, after the fact you've been attacked. That's not helpful. >> So >> It's like they dropped a bomb. We didn't know. >> Yeah, so what does IronNet doing to kind of create this radar capability? >> So, well, thanks. That's a great question because there's four things that you really got to do. First. You've got to be able to detect the SolarWinds type attacks, which we did. You've got to have a hunt platform that can see what it is. You've got to be able to use machine learning and AI to really cut down the number of events. And the most important you need to be able to anonymize and share that into the cloud and see where those attacks are going to create that radar picture. So behavioral analytics, then you use signature based as well, but you need those sets of analytics to really see what's going on. Machine learning, AI, a hunt platform, and cloud. And then analytics in the cloud to see what's going on, creates that air traffic control, picture radar, picture for cyber. That's what we're doing. You see, I think that's the important part. And that's why we really value the partnership with AWS. They've been a partner with us for six years, helping us build through that. You can see what we can do in the cloud. We could never do in hardware alone. Just imagine trying to push out equipment and then do that for hundreds of companies. It's not viable. So SaaS, what we are as a SaaS company, you can now do that at scale, and you can push this out and we can create, we can defend this nation in cyber if we work together. And that's the thing, you know, I really, had a great time in the military. One of the things I learned in the military, you need to train how you're going to fight. They're really good at that. We did that in the eighties, and you can see what happened in 1990 in the Gulf war. We need to now do that between the public and private sector. We have to have those training. We need to continuously uplift our capabilities. And that's where the cloud and all these other things make that possible. That's the future of cybersecurity. You know, it's interesting David, our country developed the internet. We're the ones that pioneered that. We ought to be the first to secure. >> Seems to make sense. And when you talk about collective defense in this private public partnership, that needs to happen, you get examples of some folks in private industry and what they're doing, but, but talk a little bit more about, maybe what isn't happening yet. What do we need to do? I don't want you to necessarily get political and start making budgetary suggestions, but unless you want to, but what, but where do you see, where do we really need to push forward from a public perspective in order to make these connections? And then how is that connection actually happen? This isn't someone from the IronNet security service desk, getting on a red phone and calling the White House, how are the actual connections made? >> So it has to be, the connections have to be just like we do radar. You know, when you think about radars across our nation or radar operator doesn't call up one of the towers and say, you've got an aircraft coming at you at such and such a speed. I hope you can distinguish between those two aircraft and make sure they don't bump into each other. They get a picture and they get a way of tracking it. And multiple people can see that radar picture at a speed. And that's how we do air traffic control safety. We need the same thing in cyber, where the government has a picture. The private sector has a picture and they can see what's going on. The private sector's role is I'm going to do everything I can, you know, and this is where the energy sector, I use that quote from Tom Fanning, because what they're saying is, "it's our job to keep the grid up." And they're putting the resources to do it. So they're actually jumping on that in a great way. And what they're saying is "we'll share that with the government", both the DHS and DOD. Now we have to have that same picture created for DHS and DOD. I think one of the things that we're doing is we're pioneering the building of that picture. So that's what we do. We build the picture to bring people together. So think of that is that's the capability. Everybody's going to own a piece of that, and everybody's going to be operating in it. But if you can share that picture, what you can begin to do is say, I've got an attack coming against company A. Company A now sees what it has to do. It can get fellow companies to help them defend, collective defense, knowledge sharing, crowdsourcing. At the same time, the government can see that attack going on and say, "my job is to stop that." If it's DHS, I could see what I have to do. Within the country, DOD can say, "my job is to shoot the archers." How do we go do what we're authorized to do under rules of engagement? So now you have a way of the government and the private sector working together to create that picture. Then we train them and we train them. We should never have had an event like SolarWinds happen in the future. We got to get out in front. And if we do that, think of the downstream consequences, not only can we detect who's doing it, we can hold them accountable and make them pay a price. Right now. It's pretty free. They get in, pap, that didn't work. They get away free. That didn't work, we get away free. Or we broke in, we got, what? 18,000 companies in 30,000 companies. No consequences. In the future there should be consequences. >> And in addition to the idea of consequences, you know, in the tech sector, we have this concept of a co-op petition, where we're often cooperating and competing. The adversaries from, U.S perspective are also great partners, trading partners. So in a sense, it sounds like what you're doing is also kind of adhering to the old adage that, that good fences make for great neighbors. If we all know that our respective infrastructures are secure, we can sort of get on with the honest business of being partners, because you want to make the cost of cyber war too expensive. Is that, is that a fair statement? >> Yes. And I would take that analogy and bend it slightly to the following. Today every company defends itself. So you take 90 companies with 10 people, each doing everything they can to defend themselves. Imagine in the world we trying to build, those 90 companies work together. You have now 900 people working together for the collective defense. If you're in the C-suite or the board of those companies, which would rather have? 900 help new security or 10? This isn't hard. And so what we say is, yes. That neighborhood watch program for cyber has tremendous value. And beyond neighborhood watch, I can also share collaboration because, I might not have the best people in every area of cyber, but in those 900, there will be, and we can share knowledge crowdsource. So it's actually let's work together. I would call it Americans working together to defend America. That's what we need to do. And the states we going to have a similar thing what they're doing, and that's how we'll work this together. >> Yeah. That makes a lot of sense. General Alexander it's been a pleasure. Thanks so much for coming on to theCube as part of our 2021 AWS re:Invent coverage. Are you going to get a chance to spend time during the conference in Las Vegas? So you just flying in, flying out. Any chance? >> Actually yeah. >> It's there, we're still negotiating working that. I've registered, but I just don't know I'm in New York city for two meetings and seeing if I can get to Las Vegas. A lot of friends, you know, Adam Solski >> Yes >> and the entire AWS team. They're amazing. And we really liked this partnership. I'd love to see you there. You're going to be there, David? Absolutely. Yes, absolutely. And I look forward to that, so I hope hopefully we get that chance again. Thank you so much, General Alexander, and also thank you to our title sponsor AMD for sponsoring this year's re:Invent. Keep it right here for more action on theCube, you're leader in hybrid tech event coverage, I'm Dave Nicholson for the Cube. Thanks. (upbeat music)

>>From around the globe. It's the cube covering Fortinet security summit brought to you by Fortinet. >>Welcome back to the cube. Lisa Martin here at the Fordham het championship security summit. Napa valley has been beautiful and gracious to us all day. We're very pleased to be here. I'm very pleased to welcome a first-timer to the cube. Rupesh Chuck Chuck Xi, VP a T and T cybersecurity and edge solutions at, at and T cybersecurity. Refresh. Welcome. >>Thank you. Thank you so much for having me, Lisa, I'm looking forward to our conversation today. >>Me too. First of all, it's we're in Napa we're outdoors. It's beautiful venue, no complaints, right? We're at a golf PGA tournament. Very exciting. Talk to me about the at and T Fordanet relationship. Give me, give me an, a good insight into the partnership. >>Sure, sure. So, as you said, you know, beautiful weather in California, Napa it's my first time. Uh, so it's kind of a new experience for me going back to your question in terms of the relationship between eight P and T and Ford in that, uh, a long lasting, you know, 10 plus years, you know, hand in hand in terms of the product, the technology, the capabilities that we are brought together in the security space for our customers. So a strategic relationship, and I'm so thrilled to be here today as a, Fordanet invited us to be part of the championship. Tommy, >>Talk to me. So your role VP of, and T cybersecurity and edge solutions, give me an, a deep dive into what's in your purview. >>Sure, sure. So I, uh, sort of, you know, run the PNL or the profit and loss center for product management for all of at and T cybersecurity and ed solutions and the whole concept behind putting the teams together is the convergence in networking and security. Um, so, you know, we are supporting the entire customer continuum, whether it's a fortune 50, the fortune 1000 to mid-market customers, to small businesses, to, you know, government agencies, you know, whether it's a local government agency or a school district or a federal agency, et cetera. And my team and I focus on bringing new product and capabilities to the marketplace, you know, working with our sales team from an enablement perspective, go to market strategy. Um, and the whole idea is about, uh, you know, winning in the marketplace, right? So delivering growth and revenue to the business, >>Competitive differentiation. So we've seen so much change in the last year and a half. I know that's an epic understatement, but we've also seen the proliferation at the edge. What are some of the challenges that you're seeing and hearing from customers where that's concerned >>As you stated, right. There's a lot happening in the edge. And sometimes the definition for edge varies when you talk with different people, uh, the way we look at it is, you know, definitely focused on the customer edge, right? So if you think about many businesses, whether I am a, a quick serve restaurant or I'm a banking Institute or a financial services or an insurance agency, or I'm a retail at et cetera, you know, lots of different branches, lots of different transformation taking place. So one way of approaching it is that when you think about the customer edge, you see a lot of virtualization, software driven, a lot of IOT endpoints, et cetera, taking place. So the cyber landscape becomes more important. Now you're connecting users, devices, capabilities, your point of sale system to a multi-cloud environment, and that, you know, encryption of that data, the speed at which it needs to happen, all of that is very important. And as we think ahead with 5g and edge compute and what that evolution revolution is going to bring, it's going to get even more excited because to me, those are kind of like in a playgrounds of innovation, but we want to do it right and keep sort of, you know, cyber and security at the core of it. So we can innovate and keep the businesses safe. >>How do you help customers to kind of navigate edge cybersecurity challenges and them not being synonymous? >>That's a great, great question. You know, every day I see, you know, different teams, different agendas, different kinds of ways of approaching things. And what I tell customers and even my own teams is that, look, we have to have a, a blueprint and architecture, a vision, you know, what are the business outcomes that we want to achieve? What the customer wants to achieve. And then start to look at that kind of technology kind of convergence that is taking place, and especially in the security and the networking space, significant momentum on the convergence and utilize that convergence to create kind of full value stack solutions that can be scaled, can be delivered. So you are not just one and done, but it's a continuous innovation and improvement. And in the security space, you need that, right. It's never going to be one and done. No >>We've seen so much change in the last year. We've seen obviously this rapid pivot to work from home that was overnight for millions and millions of people. We're still in that too. A fair amount. There's a good amount of people that are still remote, and that probably will be permanently there's. Those that are going to be hybrid threat landscape bloated. I was looking at and talking with, um, 40 guard labs and the, the nearly 11 X increase in the last 12 months in ransomware is insane. And the ransomware as a business has exploded. So security is a board level conversation for businesses I assume in any. >>Absolutely. Absolutely. I agree with you, it's a board level conversation. Security is not acknowledged the problem about picking a tool it's about, you know, the business risk and what do we need to do? Uh, you mentioned a couple of interesting stats, right? So we've seen, uh, you know, two things I'll share. One is we've seen, you know, 440 petabytes of data on the at and T network in one average business day. So 440 petabytes of data. Most people don't know what it is. So you can imagine the amount of information. So you can imagine the amount of security apparatus that you need, uh, to Tofino, protect, and defend and provide the right kind of insights. And then the other thing that VOC and along the same lines of what you were mentioning is significant, you know, ransomware, but also significant DDoSs attacks, right? So almost like, you know, we would say around 300% plus said, DDoSs mitigations that we did from last year, you know, year over year. >>So a lot of focus on texting the customer, securing the end points, the applications, the data, the network, the devices, et cetera. Uh, the other two points that I want to mention in this space, you know, again, going back to all of this is happening, right? So you have to focus on this innovation at the, at the speed of light. So, you know, artificial intelligence, machine learning, the software capabilities that are more, forward-looking have to be applied in the security space ever more than ever before, right. Needs these do, we're seeing alliances, right? We're seeing this sort of, you know, crowdsourcing going on of action on the good guys side, right? You see the national security agencies kind of leaning in saying, Hey, let's together, build this concept of a D because we're all going to be doing business. Whether it's a public to public public, to private, private, to private, all of those different entities have to work together. So having security, being a digital trust, >>Do you think that the Biden administrations fairly recent executive order catalyst of that? >>I give it, you know, the president and the, the administration, a lot of, you know, kudos for kind of, and then taking it head on and saying, look, we need to take care of this. And I think the other acknowledgement that it is not just hunting or one company or one agency, right? It's the whole ecosystem that has to come together, not just national at the global level, because we live in a hyper connected world. Right. And one of the things that you mentioned was like this hybrid work, and I was joking with somebody the other day that, and really the word is location, location, location, thinking, network security, and networking. The word is hybrid hybrid hybrid because you got a hybrid workforce, the hybrid cloud, you have a hybrid, you have a hyper-connected enterprise. So we're going to be in this sort of, you know, hybrid for quite some time are, and it has to >>Be secure and an org. And it's, you know, all the disruption of folks going to remote work and trying to get connected. One beyond video conference saying, kids are in school, spouse working, maybe kids are gaming. That's been, the conductivity alone has been a huge challenge. And Affordanet zooming a lot there with links to us, especially to help that remote environment, because we know a lot of it's going to remain, but in the spirit of transformation, you had a session today here at the security summit, talked about transformation, formation plan. We talk about that word at every event, digital transformation, right? Infrastructure transformation, it security. What context, where you talking about transformation in it today? What does it transformation plan mean for your customers? >>That's a great question because I sometimes feel, you know, overused term, right? Then you just take something and add it. It's it? Transformation, network, transformation, digital transformation. Um, but what we were talking today in, in, in the morning was more around and sort of, you know, again, going back to the network security and the transformation that the customers have to do, we hear a lot about sassy and the convergence we are seeing, you know, SD van takeoff significantly from an adoption perspective application, aware to experiences, et cetera, customers are looking at doing things like internet offload and having connectivity back into the SAS applications. Again, secure connectivity back into the SAS applications, which directly ties to their outcomes. Um, so the, the three tenants of my conversation today was, Hey, make sure you have a clear view on the business outcomes that you want to accomplish. Now, the second was work with a trusted advisor and at and T and in many cases is providing that from a trusted advisor perspective. And third, is that going back to the one and done it is not a one and done, right? This is a, is a continuous process. So sometimes we have to be thinking about, are we doing it in a way that we will always be future ready, will be always be able to deal with the security threats that we don't even know about today. So yeah, >>You bring up the term future ready. And I hear that all the time. When you think of man, we really weren't future ready. When the pandemic struck, there was so much that wasn't there. And when I was talking with 49 earlier, I said, you know, how much, uh, has the pandemic been a, uh, a catalyst for so much innovation? I imagine it has been the same thing that >>Absolutely. And, you know, I remember, you know, early days, February, March, where we're all just trying to better understand, right? What is it going to be? And the first thing was, Hey, we're all going to work remote, is it a one week? Is it a two week thing? Right? And then if you're like the CIO or the CSO or other folks who are worried about how am I going to give the productivity tools, right. Businesses in a one customer we work with, again, tobacco innovation was said, Hey, I have 20,000 call center agents that I need to take remote. How do you deliver connectivity and security? Because that call center agent is the bloodline for that business interacting with their end customers. So I think, you know, it is accelerated what would happen over 10 years and 18 months, and it's still unknown, right? So we're still discovering the future. >>There's a, there will be more silver linings to come. I think we'll learn to pick your brain on, on sassy adoption trends. One of the things I noticed in your abstract of your session here was that according to Gardner, the convergence of networking and security into the sassy framework is the most vigorous technology trend. And coming out of 2020, seeing that that's a big description, most vigorous, >>It's a big, big description, a big statement. And, uh, we are definitely seeing it. You know, we saw some of that, uh, in the second half of last year, as the organizations were getting more organized to deal with, uh, the pandemic and the change then coming into this year, it's even more accelerated. And what I mean by that is that, you know, I look at sort of, you know, three things, right? So one is going back to the hybrid work, remote work, work from anywhere, right. So how do you continue to deliver a differentiated experience, highly secure to that workforce? Because productivity, human capital very important, right? The second is that there's a back and forth on the branch transformation. So yes, you know, restaurants are opening back up. Retailers are opening back up. So businesses are thinking about how do I do that branch transformation? And then the third is explosive business IOT. So the IOT end points, do you put into manufacturing, into airports in many industries, we continue to see that. So when you think about sassy and the framework, it's about delivering a, a framework that allows you to protect and secure all of those endpoints at scale. And I think that trend is real. I've seen customer demand, we've signed a number of deals. We're implementing them as we speak across all verticals, healthcare, retail, finance, manufacturing, transportation, government agencies, small businesses, mid-sized businesses. >>Nope, Nope. Not at all. Talk to me about, I'm curious, you've been at, at and T a long time. You've seen a lot of innovation. Talk, talk to me about your perspectives on seeing that, and then what to you think as a silver lining that has come out of the, the acceleration of the last 18 months. >>She and I, I get the question, you know, I've been with at and T long time. Right. And I still remember the day I joined at T and T labs. So it was one of my kind of dream coming out of engineering school. Every engineer wants to go work for a brand that is recognized, right. And I, I drove from Clemson, South Carolina to New Jersey Homedale and, uh, I'm still, you know, you can see I'm still having the smile on my face. So I've, you know, think innovation is key. And that's what we do at, at and T I think the ability to, um, kind of move fast, you know, I think what the pandemic has taught us is the speed, right? The speed at which we have to move the speed at which we have to collaborate the speed at which we have to deliver, uh, to agility has become, you know, the differentiator for all of us. >>And we're focusing on that. I also feel that, uh, you know, there have been times where, you know, product organizations, technology organizations, you know, we struggle with jumping this sort of S-curve right, which is, Hey, I'm holding onto something. Do I let go or not? Let go. And I think the pandemic has taught us that you have to jump the S-curve, you have to accelerate because that is where you need to be in, in a way, going back to the sassy trend, right. It is something that is real, and it's going to be there for the next three to five years. So let's get ready. >>I call that getting comfortably uncomfortable, no businesses safe if they rest on their laurels these days. I think we've learned that, speaking of speed, I wanna, I wanna get kind of your perspective on 5g, where you guys are at, and when do you think it's going to be really impactful to, you know, businesses, consumers, first responders, >>The 5g investments are happening and they will continue to happen. And if you look at what's happened with the network, what at and T has announced, you know, we've gotten a lot of kudos for whatever 5g network for our mobile network, for our wireless network. And we are starting to see that, that innovation and that innovation as we anticipated is happening for the enterprise customers first, right? So there's a lot of, you know, robotics or warehouse or equipment that needs to sort of, you know, connect at a low latency, high speed, highly secure sort of, you know, data movements, compute edge that sits next to the, to the campus, you know, delivering a very different application experience. So we're seeing that, you know, momentum, uh, I think on the consumer side, it is starting to come in and it's going to take a little bit more time as the devices and the applications catch up to what we are doing in the network. And if you think about, you know, the, the value creation that has happened on, on the mobile networks is like, if you think about companies like Uber or left, right, did not exist. And, uh, many businesses, you know, are dependent on that network. And I think, uh, it will carry on. And I think in the next year or two, we'll see firsthand the outcomes and the value that it is delivering you go to a stadium at and T stadium in Dallas, you know, 5g enabled, you know, that the experience is very different. >>I can't wait to go to a stadium again and see it came or live music. Oh, that sounds great. Rubbish. Thank you so much for joining me today, talking about what a T and T is doing with 49, the challenges that you're helping your customers combat at the edge and the importance of really being future. Ready? >>Yes. Thank you. Thank you so much. Really appreciate you having me. Thanks for 49 to invite us to be at this event. Yes. >>Thank you for refresh talk. She I'm Lisa Martin. You're watching the cube at the 40 net championship security summits.

>> From theCUBE studios in Palo Alto, in Boston bringing you data-driven insights from theCUBE and ETR. This is Breaking Analysis with Dave Vellante >> The latest Arm Neoverse announcement further cements our opinion that it's architecture business model and ecosystem execution are defining a new era of computing and leaving Intel in it's dust. We believe the company and its partners have at least a two year lead on Intel and are currently in a far better position to capitalize on a major waves that are driving the technology industry and its innovation. To compete our view is that Intel needs a new strategy. Now, Pat Gelsinger is bringing that but they also need financial support from the US and the EU governments. Pat Gelsinger was just noted as asking or requesting from the EU government $9 billion, sorry, 8 billion euros in financial support. And very importantly, Intel needs a volume for its new Foundry business. And that is where Apple could be a key. Hello, everyone. And welcome to this week's weekly bond Cube insights powered by ETR. In this breaking analysis will explain why Apple could be the key to saving Intel and America's semiconductor industry leadership. We'll also further explore our scenario of the evolution of computing and what will happen to Intel if it can't catch up. Here's a hint it's not pretty. Let's start by looking at some of the key assumptions that we've made that are informing our scenarios. We've pointed out many times that we believe Arm wafer volumes are approaching 10 times those of x86 wafers. This means that manufacturers of Arm chips have a significant cost advantage over Intel. We've covered that extensively, but we repeat it because when we see news reports and analysis and print it's not a factor that anybody's highlighting. And this is probably the most important issue that Intel faces. And it's why we feel that Apple could be Intel's savior. We'll come back to that. We've projected that the chip shortage will last no less than three years, perhaps even longer. As we reported in a recent breaking analysis. Well, Moore's law is waning. The result of Moore's law, I.e the doubling of processor performance every 18 to 24 months is actually accelerating. We've observed and continue to project a quadrupling of performance every two years, breaking historical norms. Arm is attacking the enterprise and the data center. We see hyperscalers as the tip of their entry spear. AWS's graviton chip is the best example. Amazon and other cloud vendors that have engineering and software capabilities are making Arm-based chips capable of running general purpose applications. This is a huge threat to x86. And if Intel doesn't quickly we believe Arm will gain a 50% share of an enterprise semiconductor spend by 2030. We see the definition of Cloud expanding. Cloud is no longer a remote set of services, in the cloud, rather it's expanding to the edge where the edge could be a data center, a data closet, or a true edge device or system. And Arm is by far in our view in the best position to support the new workloads and computing models that are emerging as a result. Finally geopolitical forces are at play here. We believe the U S government will do, or at least should do everything possible to ensure that Intel and the U S chip industry regain its leadership position in the semiconductor business. If they don't the U S and Intel could fade to irrelevance. Let's look at this last point and make some comments on that. Here's a map of the South China sea in a way off in the Pacific we've superimposed a little pie chart. And we asked ourselves if you had a hundred points of strategic value to allocate, how much would you put in the semiconductor manufacturing bucket and how much would go to design? And our conclusion was 50, 50. Now it used to be because of Intel's dominance with x86 and its volume that the United States was number one in both strategic areas. But today that orange slice of the pie is dominated by TSMC. Thanks to Arm volumes. Now we've reported extensively on this and we don't want to dwell on it for too long but on all accounts cost, technology, volume. TSMC is the clear leader here. China's president Xi has a stated goal of unifying Taiwan by China's Centennial in 2049, will this tiny Island nation which dominates a critical part of the strategic semiconductor pie, go the way of Hong Kong and be subsumed into China. Well, military experts say it was very hard for China to take Taiwan by force, without heavy losses and some serious international repercussions. The US's military presence in the Philippines and Okinawa and Guam combined with support from Japan and South Korea would make it even more difficult. And certainly the Taiwanese people you would think would prefer their independence. But Taiwanese leadership, it ebbs and flows between those hardliners who really want to separate and want independence and those that are more sympathetic to China. Could China for example, use cyber warfare to over time control the narrative in Taiwan. Remember if you control the narrative you can control the meme. If you can crawl the meme you control the idea. If you control the idea, you control the belief system. And if you control the belief system you control the population without firing a shot. So is it possible that over the next 25 years China could weaponize propaganda and social media to reach its objectives with Taiwan? Maybe it's a long shot but if you're a senior strategist in the U S government would you want to leave that to chance? We don't think so. Let's park that for now and double click on one of our key findings. And that is the pace of semiconductor performance gains. As we first reported a few weeks ago. Well, Moore's law is moderating the outlook for cheap dense and efficient processing power has never been better. This slideshows two simple log lines. One is the traditional Moore's law curve. That's the one at the bottom. And the other is the current pace of system performance improvement that we're seeing measured in trillions of operations per second. Now, if you calculate the historical annual rate of processor performance improvement that we saw with x86, the math comes out to around 40% improvement per year. Now that rate is slowing. It's now down to around 30% annually. So we're not quite doubling every 24 months anymore with x86 and that's why people say Moore's law is dead. But if you look at the (indistinct) effects of packaging CPU's, GPU's, NPUs accelerators, DSPs and all the alternative processing power you can find in SOC system on chip and eventually system on package it's growing at more than a hundred percent per annum. And this means that the processing power is now quadrupling every 24 months. That's impressive. And the reason we're here is Arm. Arm has redefined the core process of model for a new era of computing. Arm made an announcement last week which really recycle some old content from last September, but it also put forth new proof points on adoption and performance. Arm laid out three components and its announcement. The first was Neoverse version one which is all about extending vector performance. This is critical for high performance computing HPC which at one point you thought that was a niche but it is the AI platform. AI workloads are not a niche. Second Arm announced the Neoverse and two platform based on the recently introduced Arm V9. We talked about that a lot in one of our earlier Breaking Analysis. This is going to performance boost of around 40%. Now the third was, it was called CMN-700 Arm maybe needs to work on some of its names, but Arm said this is the industry's most advanced mesh interconnect. This is the glue for the V1 and the N2 platforms. The importance is it allows for more efficient use and sharing of memory resources across components of the system package. We talked about this extensively in previous episodes the importance of that capability. Now let's share with you this wheel diagram underscores the completeness of the Arm platform. Arms approach is to enable flexibility across an open ecosystem, allowing for value add at many levels. Arm has built the architecture in design and allows an open ecosystem to provide the value added software. Now, very importantly, Arm has created the standards and specifications by which they can with certainty, certify that the Foundry can make the chips to a high quality standard, and importantly that all the applications are going to run properly. In other words, if you design an application, it will work across the ecosystem and maintain backwards compatibility with previous generations, like Intel has done for years but Arm as we'll see next is positioning not only for existing workloads but also the emerging high growth applications. To (indistinct) here's the Arm total available market as we see it, we think the end market spending value of just the chips going into these areas is $600 billion today. And it's going to grow to 1 trillion by 2030. In other words, we're allocating the value of the end market spend in these sectors to the marked up value of the Silicon as a percentage of the total spend. It's enormous. So the big areas are Hyperscale Clouds which we think is around 20% of this TAM and the HPC and AI workloads, which account for about 35% and the Edge will ultimately be the largest of all probably capturing 45%. And these are rough estimates and they'll ebb and flow and there's obviously some overlap but the bottom line is the market is huge and growing very rapidly. And you see that little red highlighted area that's enterprise IT. Traditional IT and that's the x86 market in context. So it's relatively small. What's happening is we're seeing a number of traditional IT vendors, packaging x86 boxes throwing them over the fence and saying, we're going after the Edge. And what they're doing is saying, okay the edge is this aggregation point for all these end point devices. We think the real opportunity at the Edge is for AI inferencing. That, that is where most of the activity and most of the spending is going to be. And we think Arm is going to dominate that market. And this brings up another challenge for Intel. So we've made the point a zillion times that PC volumes peaked in 2011. And we saw that as problematic for Intel for the cost reasons that we've beat into your head. And lo and behold PC volumes, they actually grew last year thanks to COVID and we'll continue to grow it seems for a year or so. Here's some ETR data that underscores that fact. This chart shows the net score. Remember that's spending momentum it's the breakdown for Dell's laptop business. The green means spending is accelerating and the red is decelerating. And the blue line is net score that spending momentum. And the trend is up and to the right now, as we've said this is great news for Dell and HP and Lenovo and Apple for its laptops, all the laptops sellers but it's not necessarily great news for Intel. Why? I mean, it's okay. But what it does is it shifts Intel's product mix toward lower margin, PC chips and it squeezes Intel's gross margins. So the CFO has to explain that margin contraction to wall street. Imagine that the business that got Intel to its monopoly status is growing faster than the high margin server business. And that's pulling margins down. So as we said, Intel is fighting a war on multiple fronts. It's battling AMD in the core x86 business both PCs and servers. It's watching Arm mop up in mobile. It's trying to figure out how to reinvent itself and change its culture to allow more flexibility into its designs. And it's spinning up a Foundry business to compete with TSMC. So it's got to fund all this while at the same time propping up at stock with buybacks Intel last summer announced that it was accelerating it's $10 billion stock buyback program, $10 billion. Buy stock back, or build a Foundry which do you think is more important for the future of Intel and the us semiconductor industry? So Intel, it's got to protect its past while building his future and placating wall street all at the same time. And here's where it gets even more dicey. Intel's got to protect its high-end x86 business. It is the cash cow and funds their operation. Who's Intel's biggest customer Dell, HP, Facebook, Google Amazon? Well, let's just say Amazon is a big customer. Can we agree on that? And we know AWS is biggest revenue generator is EC2. And EC2 was powered by microprocessors made from Intel and others. We found this slide in the Arm Neoverse deck and it caught our attention. The data comes from a data platform called lifter insights. The charts show, the rapid growth of AWS is graviton chips which are they're custom designed chips based on Arm of course. The blue is that graviton and the black vendor A presumably is Intel and the gray is assumed to be AMD. The eye popper is the 2020 pie chart. The instant deployments, nearly 50% are graviton. So if you're Pat Gelsinger, you better be all over AWS. You don't want to lose this customer and you're going to do everything in your power to keep them. But the trend is not your friend in this account. Now the story gets even gnarlier and here's the killer chart. It shows the ISV ecosystem platforms that run on graviton too, because AWS has such good engineering and controls its own stack. It can build Arm-based chips that run software designed to run on general purpose x86 systems. Yes, it's true. The ISV, they got to do some work, but large ISV they have a huge incentives because they want to ride the AWS wave. Certainly the user doesn't know or care but AWS cares because it's driving costs and energy consumption down and performance up. Lower cost, higher performance. Sounds like something Amazon wants to consistently deliver, right? And the ISV portfolio that runs on our base graviton and it's just going to continue to grow. And by the way, it's not just Amazon. It's Alibaba, it's Oracle, it's Marvell. It's 10 cents. The list keeps growing Arm, trotted out a number of names. And I would expect over time it's going to be Facebook and Google and Microsoft. If they're not, are you there? Now the last piece of the Arm architecture story that we want to share is the progress that they're making and compare that to x86. This chart shows how Arm is innovating and let's start with the first line under platform capabilities. Number of cores supported per die or, or system. Now die is what ends up as a chip on a small piece of Silicon. Think of the die as circuit diagram of the chip if you will, and these circuits they're fabricated on wafers using photo lithography. The wafers then cut up into many pieces each one, having a chip. Each of these pieces is the chip. And two chips make up a system. The key here is that Arm is quadrupling the number of cores instead of increasing thread counts. It's giving you cores. Cores are better than threads because threads are shared and cores are independent and much easier to virtualize. This is particularly important in situations where you want to be as efficient as possible sharing massive resources like the Cloud. Now, as you can see in the right hand side of the chart under the orange Arm is dramatically increasing the amount of capabilities compared to previous generations. And one of the other highlights to us is that last line that CCIX and CXL support again Arm maybe needs to name these better. These refer to Arms and memory sharing capabilities within and between processors. This allows CPU's GPU's NPS, et cetera to share resources very often efficiently especially compared to the way x86 works where everything is currently controlled by the x86 processor. CCIX and CXL support on the other hand will allow designers to program the system and share memory wherever they want within the system directly and not have to go through the overhead of a central processor, which owns the memory. So for example, if there's a CPU, GPU, NPU the CPU can say to the GPU, give me your results at a specified location and signal me when you're done. So when the GPU is finished calculating and sending the results, the GPU just signals the operation is complete. Versus having to ping the CPU constantly, which is overhead intensive. Now composability in that chart means the system it's a fixed. Rather you can programmatically change the characteristics of the system on the fly. For example, if the NPU is idle you can allocate more resources to other parts of the system. Now, Intel is doing this too in the future but we think Arm is way ahead. At least by two years this is also huge for Nvidia, which today relies on x86. A major problem for Nvidia has been coherent memory management because the utilization of its GPU is appallingly low and it can't be easily optimized. Last week, Nvidia announced it's intent to provide an AI capability for the data center without x86 I.e using Arm-based processors. So Nvidia another big Intel customer is also moving to Arm. And if it's successful acquiring Arm which is still a long shot this trend is only going to accelerate. But the bottom line is if Intel can't move fast enough to stem the momentum of Arm we believe Arm will capture 50% of the enterprise semiconductor spending by 2030. So how does Intel continue to lead? Well, it's not going to be easy. Remember we said, Intel, can't go it alone. And we posited that the company would have to initiate a joint venture structure. We propose a triumvirate of Intel, IBM with its power of 10 and memory aggregation and memory architecture And Samsung with its volume manufacturing expertise on the premise that it coveted in on US soil presence. Now upon further review we're not sure the Samsung is willing to give up and contribute its IP to this venture. It's put a lot of money and a lot of emphasis on infrastructure in South Korea. And furthermore, we're not convinced that Arvind Krishna who we believe ultimately made the call to Jettisons. Jettison IBM's micro electronics business wants to put his efforts back into manufacturing semi-conductors. So we have this conundrum. Intel is fighting AMD, which is already at seven nanometer. Intel has a fall behind in process manufacturing which is strategically important to the United States it's military and the nation's competitiveness. Intel's behind the curve on cost and architecture and is losing key customers in the most important market segments. And it's way behind on volume. The critical piece of the pie that nobody ever talks about. Intel must become more price and performance competitive with x86 and bring in new composable designs that maintain x86 competitive. And give the ability to allow customers and designers to add and customize GPU's, NPUs, accelerators et cetera. All while launching a successful Foundry business. So we think there's another possibility to this thought exercise. Apple is currently reliant on TSMC and is pushing them hard toward five nanometer, in fact sucking up a lot of that volume and TSMC is maybe not servicing some other customers as well as it's servicing Apple because it's a bit destructive, it is distracted and you have this chip shortage. So Apple because of its size gets the lion's share of the attention but Apple needs a trusted onshore supplier. Sure TSMC is adding manufacturing capacity in the US and Arizona. But back to our precarious scenario in the South China sea. Will the U S government and Apple sit back and hope for the best or will they hope for the best and plan for the worst? Let's face it. If China gains control of TSMC, it could block access to the latest and greatest process technology. Apple just announced that it's investing billions of dollars in semiconductor technology across the US. The US government is pressuring big tech. What about an Apple Intel joint venture? Apple brings the volume, it's Cloud, it's Cloud, sorry. It's money it's design leadership, all that to the table. And they could partner with Intel. It gives Intel the Foundry business and a guaranteed volume stream. And maybe the U S government gives Apple a little bit of breathing room and the whole big up big breakup, big tech narrative. And even though it's not necessarily specifically targeting Apple but maybe the US government needs to think twice before it attacks big tech and thinks about the long-term strategic ramifications. Wouldn't that be ironic? Apple dumps Intel in favor of Arm for the M1 and then incubates, and essentially saves Intel with a pipeline of Foundry business. Now back to IBM in this scenario, we've put a question mark on the slide because maybe IBM just gets in the way and why not? A nice clean partnership between Intel and Apple? Who knows? Maybe Gelsinger can even negotiate this without giving up any equity to Apple, but Apple could be a key ingredient to a cocktail of a new strategy under Pat Gelsinger leadership. Gobs of cash from the US and EU governments and volume from Apple. Wow, still a long shot, but one worth pursuing because as we've written, Intel is too strategic to fail. Okay, well, what do you think? You can DM me @dvellante or email me at david.vellante@siliconangle.com or comment on my LinkedIn post. Remember, these episodes are all available as podcasts so please subscribe wherever you listen. I publish weekly on wikibon.com and siliconangle.com. And don't forget to check out etr.plus for all the survey analysis. And I want to thank my colleague, David Floyer for his collaboration on this and other related episodes. This is Dave Vellante for theCUBE insights powered by ETR. Thanks for watching, be well, and we'll see you next time. (upbeat music)

>> From around the globe it's theCUBE with coverage of the GLOBAL.NEXT DIGITAL EXPERIENCE brought to you by Nutanix. >> Hi and welcome back, we're wrapping up our coverage of the Nutanix .Next Global Digital Experience, I'm Stu Miniman and I'm happy to welcome to the program, help us as I said wrap things up. We're going to be talking about running better, running faster and running anywhere. A theme that we've heard in the keynotes and throughout the two day event of the show. We have three VPs to help go through all the pieces coming up on the screen with first of all we have Greg Smith who's the vice president of product technical marketing right next to him is Madhukar Kumar, who is the vice president of product and solutions marketing and on the far end, the senior vice president Thomas Cornely, he is the senior vice president, as I said for product portfolio management. Gentlemen, thank you so much for joining us. >> Good to be here Stu. >> Alright, so done next to show we really enjoy, of course this the global event so not just the US and the European and Asia but what really gets to see across the globe and a lot going on. I've had the pleasure of watching Nutanix since the early days, been to most of the events and the portfolio is quite a bit bigger than just the original HCI solution. Thomas since you've got to portfolio management is under your purview, before we get into summarizing all of the new pieces and the expansion of the cloud and software and everything just give us if you could that overview of the portfolio as it's coming into the show. >> Yeah absolutely Stu. I mean as you said we've been doing this now for 10 plus years and we've grown the portfolio we developed products over the years and so what we rolled out at this conference is a new way and to talk about what we do at Nutanix and what we deliver in terms of set of offerings and we talk about the 4 D's. We start with our digital hyper converged infrastructure cartridges, dual core HCI stack that you can run on any server and that stack these two boards are data center services which combines our storage solutions, our business computing and data recovery solution and security solutions on DevOps services, which is our database automation services, our application delivery automation services and now our new common and that's one of the service offerings and then our desktop services catridges which is our core VDI offering and offering our discipline and service offerings. So put all these together this is what we talk about in the 4 D's, which is on Nutanix cloud platform that you can run on premises and now on any job. >> Well thank you Thomas for laying the ground work for us, Greg we're going to come to you first that run better theme as Thomas said and as we know HCI is at the core a lot of discussions this year of course, the ripple effect of the global pandemic has more people working remotely that's been a tailwind for many of the core offerings, but help us understand, how's that building out some of the new things that we should look at in the HCI. >> Yeah ,thanks too for Nutanix and our customers a lot of it begins with HCI, right. And what we've seen in the past year is really aggressive adoption for HCI, particularly in core data center and private cloud operations and customers are moving to HCI in our not only for greater simplicity, but to get faster provisioning and scaling. And I think from a workload perspective, we see two things, that ACI is being called upon to deliver even more demanding apps those with a really very low latency such as large scale database deployments. And we also see that HCI is expected to improve the economics of IT and the data center and specifically by increasing workload density. So we have a long history, a storied history of continually improving HCI performance. In fact every significant software release we've optimized the core data path and we've done it again. We've done it again with our latest HCI software release that we announced just this week as our next. The first enhancement we made was in 518, was to reduce the CPU overhead and latency for accessing storage devices such as SSD and NBME and we've done this by managing storage space on physical devices in the HCI software. So rather than rely on slower internal file systems and this new technology is called block store and our customers can take advantage of block store simply by upgrading to the new software released and we're seeing immediate performance gains of 20 to 25% for IOPS and latency. And then we built on top of that, we've added software support for Intel Optane by leveraging user space library, specifically SPDK or storage performance development kit. And SPDK allows Nutanix to access devices from user space and avoid expensive interrupts and systems calls. So with this support along with block store we're seeing application performance gains about this 56% or more. So we're just building our own a legacy of pushing performance and software and that's the real benefit of moving to HCI. >> And just to add to that too when it comes to run better I think one of the things that we think of running better is automation and operation then when it comes to automation and operation there are a couple of ways I would say significant announcements that we also did to. One is around Comm as a service. Comm is one of those products that our customers absolutely love and now with Comm as a service you have a SaaS plane, so you can just without installing anything or configuring anything you could just take advantage of that. And the other thing we also announced is something called Nutanix central and Nutanix central gives you the way to manage all your applications on Nutanix across all of your different clusters and infrastructure from a single place as well. So two big parts of a run better as well. >> Well, that's great and I've really, is that foundational layer, Madhukar if we talk about expanding out, running faster the other piece we've talked about for a few years is step one is you modernize the platform and then step two is really you have to modernize your application. So maybe help us understand that changing workload cloud native is that discussion that we've been having a few years now, what are you hearing from your customers and what new pieces do you have to expand and enable that piece of the overall stack? >> Yeah, so I think what you mentioned which is around cloud data the big piece over there is around Cybernetics's and they already had a carbon, so with carbon a lot of the things of complexities around managing cybernetics is all taken care of, but there are higher level aspects on it like you have to have observability, you have to have log, you have to have managed the ingress ,outgress which has a lot of complexity involved with, so if you're really just looking for building of applications what we found is that a lot of our customers are looking for a way to be able to manage that on their own. So what we announced which is carbon platform service enables you to do exactly that. So if you're really concerned about creating cloud native applications without really worrying too much about how do I configure the cybernetics clusters? How do I manage Histio? How do I manage all of that carbon platform service that actually encapsulates all of that to a sass plate So you can go in and create your cloud native application as quickly and as fast as possible, but just in a typical Nutanix style we wanted to give that freedom of choice to our customers as well. So if you do end up utilizing this what you can also choose is the end point where you want these application to run and you could choose any of the public clouds or the hyper scaler or you could use a Nutanix or an IOT as an endpoint as well. So that was one of the big announcements we've made. >> Great, Greg and Madhukar before we go on, it's one of the things that I think is a thread throughout but maybe doesn't get highlighted as much but security of course is been front and center for a while, but here in 2020 is even more emphasized things like ransomware, of course even more so today than it has been for a couple of years. So maybe could it just address where we are with security and any new pieces along there that we should understand? >> Yeah, I can start with that if I could. So we've long had security in our platform specifically micro-segmentation, fire walling individual workloads to provide least privilege access and what we've announced this week at .Next is we've extended that capability, specifically we've leveraged some of the capabilities in Xi beam and this is our SAS based service to really build a single dashboard for security operators. So with security central, again a cloud based SAS app, Nutanix customers can get a single pane from which they can monitor the entire security posture of their infrastructure and applications, it gives you asset reporting, asset inventory reporting, you can get automated compliance checks or HIPAA or PCI and others. So we've made security really easy in keeping with the Nutanix theme and it's a security central is a great tool for that security operations team so it's a big step for Nutanix and security. >> Yeah. >> To actually add on this one, one bit piece of security central is to make it easier, right. To see your various network bills and leverage the flow micro segmentation services and configure them on your different virtual machines, right? So it's really a key enabler here to kind of get a sense of what's going on in your environment and best configure and best protect and secure infrastructure. >> Thomas is exactly right. In fact, one of the things I wanted to chime into and maybe Greg you could speak a little bit more about it. One of my favorite announcements that we heard or at least I heard was the virtualized networking and coming from a cloud native world, I think that's a big deal. The ability to go create your virtual private cloud or VPCs and subnets and then be able to do it across multiple clouds. That's, something I think has been long time coming, so I was personally very, very pleased to hear that as well. Greg, do you want to add a little bit more? >> Yeah, that's a good point I'm glad you brought that up, when we talk about micro-segmentation that's one form of isolation, but what we've announced is virtual networking. So we really adopted some cloud principles, specifically virtual private clouds constructs that we can now bring into private cloud data centers. So this gives our customers the ability to define and deploy virtual networks or overlays this sort of sit on top of broadcast domains and VLANs and it provides isolation for different environments. So a number of great use cases, we see HCI specifically being relied upon for fast provisioning in a new environment. But today the network has always been sort of an impediment to that we're sort of stuck with physical network plants, switches and routers. So what virtual networking allows us to do is through APIs, is to create an isolated network a virtual private cloud on a self service basis. This is great for organizations that increasing operating as service providers and they need that tenant level segmentation. It's also good for developers who need isolated workspace and they want to spin it up quickly. So we see a lot of great use cases for virtual networks and it just sort of adds to our full stack so we've software defined compute, we've software defined storage, now we're completing that with software defining networking. >> And if I have it right in my notes the virtual networking that's in preview today correct? >> Yes, we announce it this week and we are announcing upcoming availability, so we have number of customers who are already working with us to help define it and ready to put it into their environments. The virtual private network is upcoming from Nutanix. >> Yeah, so I absolutely I've got, Mudhakar, I've got a special place in my heart for the networking piece that's where a lot of my background is, but there was a different announcement that got a little bit more of my attention and Thomas we're going to turn to you to talk a little bit more about clusters. I got to speak with Monica and Tarkin, ahead of the conference when you had the announcement with AWS, for releasing Nutanix clusters and this is something we've been watching for a bit, when you talk about the multicloud messaging and how you're taking the Nutanix software and extending it even further that run anywhere that you have talk about in the conference. So Thomas if you could just walk us through the announcements as I said something we've been excited, I've been watching this closely for the last couple of years with Nutanix and great to see some of the pieces really starting to accelerate. >> Well absolutely and as you said this is something that's been core to the strategy in terms of getting and enabling customers to go and do more with hybrid cloud and public cloud and if you go back a few weeks when we announced clusters on AWS this was a few weeks back now, we talked of HCI is a prerequisite to getting the most of your hybrid cloud infrastructure, which is the new HCI in our mind and what we covered at .Next was this great announcement with Microsoft Azure, right, and just leveraging their technologies bringing some of their control plan onto our cloud platform but also now adding clusters on Azure and announcing that we'll be doing this in a few months. Enabling the customers to go and take the same internet cloud platform the same consistent set of operations and technology services from data center services, DevOps services and desktop services and deploying those anywhere on premises, on AWS or on Microsoft Azure and again for us cloud is not a destination. This is not a now we just accomplished something. This is a new way of operating, right? And so it's touching, giving customers options in terms of where they want to go to count so we keep on adding new counts as we go but also it's a new form of consuming infrastructure, right? From an economist perspective you probably know, you don't extend it you're pressing into the moving to is fiction based offering on all of our solutions and our entire portfolio and as we go and enable these clusters offering, we're not making consumptions more granular to non customers do not consume our software on an hourly basis or a monthly basis. So again this is kind of that next step of cloud is not just technology, it's not a destination it's a new way of operating and consuming technology. >> Why think about the flexibility that this brings to existing new techs customers it gives them enormous choices in terms of new infrastructure and whether they set up new clusters. So think about in text a customer today. They may have data centers throughout the US or in Europe and in Asia Pacific, but now they have a choice rather than employ their Nutanix environment, in an existing data center or Colo, they can put it into AWS and they can manage it exactly the same. So it just provides near infinite choice for our customers of how they deploy HCI and our full software stack. In addition to the consumption that Thomas talked about, consumption choices. >> Yeah, just to add to that again I should have said this is also one of my favorite announcements as well, yesterday. We Greg, myself, Thomas, we were talking to some industry analysts and they were talking about, Hey, you know how there is a need for pods where you have compute, you have network and you have storage altogether, and now people want to run it across multiple different destination but they have to have the freedom of choice. Today using one different kind of hardware tomorrow you want to use something else. They should be portability for that, so with clusters, I think what we have been able to do is to take that concept and apply it across public cloud. So the same whether you want to call it a pod or whatever but compute, storage, networking. Now you have the freedom of choice of choosing a public cloud as an end point where you want to run it. So absolutely one of those I would say game-changing announcements that we have made more recently. >> Yeah-- >> To close that loop actually and talk about portability as enabling quality of occupations. But also one thing that's really unique in terms of how we're delivering this to customers is probability of licenses. The fact that you have a subscription term license for on premises you can very easily now repay the license if you decide to move a workload and move a cluster from one premises to your count of choice, that distance is also affordable. But so again, full flexibility for these customers, freedom of choice from a technology perspective but also a business perspective. >> Well, one of the things I think that really brings home how real this solution is, it's not just about location, Thomas as you said, it's not about a destination, but it's about what you can do with those workloads. So one of the use cases I saw during the conference was talking about a very long partner of a Nutanix Citrix and how that plays out in this clusters type of environment so maybe if you could just illustrate that as one of those proof points is how customers can leverage the variety of choice. >> Yeah, we're very excited about this one, right? Because given what we're currently going through as a humanity right now, across the world with COVID situation, and the fact that we all have now to start looking at working from home, enabling scaling of existing infrastructure and doing it without having to go and rethink your design enabling this clusters in our Citrix solution is just paramount. Because what it will ask you to do is if you say you started and you had an existing VDI solution on premises using Citrix, extending that now and you putting new capacity in every location where you can go and spin this up in any AWS region or Azure region, no one has to go and the same images, the same processes, the same operations of your original desktop infrastructure would apply regardless of where you're moving now your workforce to work remotely. And this is again it's about making this very easy and keeping that consistency operations, from managing the desktops to managing that core infrastructure that is now enabled by using different clusters on Azure or AWS. >> Well, Thomas back in a previous answer, I thought you were teeing something up when you said we will be entering a new era. So when you talk about workloads that are going to the cloud, you talk about modernization probably the hottest area that we have conversations with practitioners on is what's happening in the database world. Of course, there's migrations, there's lots of new databases on there, and Nutanix era is helping in that piece. So maybe if we could as kind of a final workload talk about how that's expanding and what updates you have for the database. >> Absolutely and so I mean Eras is one of our key offerings when it comes to a database automation and really enabling teams to start delivering database as a service to their own and users. We just announced Era 2.0 which is now taking Era to a whole other level, allowing you to go and manage your devices on cross clusters. And this is very topical in this current use case, because we're talking of now I can use era to go in as your database that might be running on premises for production and using Era to spin up clones for test drive for any team anywhere potentially in cloud then using clusters on the all kind of environments. So those use cases of being which more leverage the power of the core is same structure of Nutanix for storage management for efficiency but also performance and scaling doing that on premises and in unique cloud region that you may want to leverage, using Era for all the automation and ensuring that you keep on with your best practices in terms of deploying and hacking your databases is really critical. So Era 2.0 great use cases here to go and just streamline how you onboard databases on top of HCI whether you're doing HCI on premises or HCI in public town, and getting automation of those operations at any scale. >> Yeah, hey Tom has mentioned a performance and Era has been a great extension to the portfolio sitting on top of our HCI. As you know Stu database has long been a popular workload to run it all HCI, particularly Nutanix and it extends from scalability performance. A lot of I talked about earlier in terms of providing that really low latency to support the I-Ops, to support the transactions per second, that are needed these very demanding databases. Our customers have had great success running SAP, HANA, Oracle SQL server. So I think it's a combination of Era and what we're doing as Thomas described as well as just getting a rock solid foundational HCI platform to run it on and so that's what we're very excited about to go forward in the database world. >> Wonderful, well look, we covered a lot of ground here. I know we probably didn't hit everything there but it's been amazing to watch Nutanix really going from simplicity at its core and software driving it to now that really spiders out and touches a lot of pieces. So I'll give you each just kind of final word as you having conversations with your customers, how do they think of Nutanix today and expect that we have a little bit of diversity and the answers but it's one of those questions I think the last couple of years you've asked when people register for .Next. So it's, I'm curious to hear what you think on that. Maybe Greg if we start with you and kind of go down the line. >> Yeah, for me what sums it up is Nutanix makes IT simple, It makes IT invisible and it allows professionals to move away from the care and feeding structure and really spend more time with the applications and services that power their business. >> And I agree with Greg I think the two things that always come up, one is the freedom of choice, the ability for our customers to be able to do so many different things, have so many more choices and we continue to do that every time we add something new or we announce something new and then just to add onto what Greg said is to try and make the complexities invisible, so if there are multiple layers, abstract them out so that our customers are really focused on doing things that really matter versus trying to manage all the other underlying layers, which adds more complexity. >> Yeah You could just kind of send me to it up right. In the end, internet is becoming much more than HCI, as hyper converged infrastructure this is not taking it to another level with the hybrid cloud infrastructure and when you look at what's been built over the last few years from the portfolio points that we now have, I think it was just growing recognition that internet actually delivers this cloud platform that you can all average to go and get to a consistency of services, operations and business operations in any location, on premises through our network constant providers through our Nutanix cloud offerings and hyper scaler with Nutanix clusters. So I think things are really changing, the company is getting to a whole other level and I couldn't be more excited about what's coming out now the next few years as we keep on building and scaling our cloud platform. >> And I'll just add my perspective as a long time watcher of Nutanix. For so long IT was the organization where you typically got an answer of no, or they were very slow to be able to react on it. It was actually a quote from Alan Cohen at the first .Next down in Miami he said, "we take need to take those nos "and those slows and get them to say go." So the ultimate, what we need is of course reacting to the business, taking those people, eliminating some of the things that were burdensome or took up too much time and you're freeing them up to be able to really create value for the business. Want to thank Greg, Madhukar, Thomas, thank you so much for helping us wrap up, theCUBE is always thrilled to be able to participate in .Next great community customers really engaged and great to talk with all three of you. >> Thank you. >> Alright so that's a rack for theCUBES coverage of the Nutanix Global.Next digital experience. Go to thecube.com. thecube.net is the website where you can go see all of the previous interviews we've done with the executives, the partners, the customers. I'm Stu Miniman and as always thank you for watching theCUBE.

>> Narrator: From around the globe, it's theCUBE with coverage of the Global .NEXT Digital Experience brought to you by Nutanix. >> Welcome back, I'm Stu Miniman and this is theCUBE's coverage of the Nutanix .NEXT Digital Experience. We've got two of the c-suite here to really dig into some of the strategy and partnerships talked at their annual user conference. Happy to welcome back to the program two of our CUBE alumni first of all, we have Tarkan Maner. He is the Chief Customer Officer at Nutanix and joining us also Rajiv Mirani, he is the Chief Technology Officer, CTO. Rajiv, Tarkan, great to see you both. Thanks so much for joining us on theCUBE. >> Great to be back. >> Good to see you. >> All right. So Tarkan talk about a number of announcements. You had some big partner executives up on stage. As I just talked with Monica about, Scott Guthrie wearing the signature red polo, you had Kirk Skaugen from Lenovo of course, a real growing partnership with Nutanix, a bunch of others and even my understanding the partner program for how you go to market has gone through a lot. So a whole lot of stuff to go into, partnerships, don't need to tackle it all here upfront, but give us some of the highlights from your standpoint. >> I'll tell this to my dear friend Rajiv and I've been really busy, last few months and last 12 months have been super, super busy for us. And as you know, the latest announcements we made the new $750 million investment from Bain capital, amazing if by 20 results, Q4, big results. And obviously in the last few months big announcements with AWS as part of our hybrid multicloud vision and obviously Rajiv and I, we're making sale announcements, product announcements, partner announcements at .NEXT. So at a high level, I know Rajiv is going to cover this a little bit more in detail, but we covered everything under these three premises. Run better, run faster and run anywhere. Without stealing the thunder from Rajiv, but I just want to give you at a high level a little bit. What excites us a lot is obviously the customer partner intimacy and all this new IP innovation and announcement also very strong, very tight operational results and operational execution makes the company really special as a independent software vendor in this multicloud era. Obviously, we are the only true independent software vendor to do not run a business in a sense with fast growth. Timed to that announcement chain we make this big announcement with Azure partnership, our Nutanix portfolio under the Nutanix cluster ran now available as Bare-Metal Service on Azure after AWS. The partnership is new with Azure. We just announced the first angle of it. Limited access customers are taking it to look at the service. We're going to have a public preview in a few months, and more to come. And obviously we're not going to stop there. We have tons of work going on with other cloud providers, as well. Tying that, obviously, big focus with our Citrix partnership globally around our end user computing business as Rajiv will outline further, our portfolio on top of our digital infrastructure, tying the data center services, DevOps services, and you user computing services, Citrix partnership becomes a big one, and obviously you're tying the Lenovo and HP partnership to these things as the core platforms to run that business. It's creating tons of opportunity and I'll cover a little bit more further in a bit more detail, but one other partnership we are also focusing on, our Google partnership and on desktop as a service. So these are all coming to get around data center, DevOps, and user competent services on top of that amazing infrastructure Rajiv and team built over the past 10 years. I see Rajiv as one of our co-founders and one side with the right another. So the business is obviously booming in multiple fronts. This, if by 2020 was a great starting point with all this investment, that bank capital $750 million, big execution, ACD transition, software transition. And obviously these cloud partnerships are going to make big differences moving forward. >> Yeah, so Rajiv, want to build off what Tarkan was just saying there, that really coming together, when I heard the strategy run better, run faster, run anywhere, it really pulled together some of the threads I've been watching at Nutanix the last couple of years. There's been some SaaS solutions where it was like, wait, I don't understand how that ties back to really the core of what Nutanix does. And of course, Nutanix is more than just an HCI company, it's software and that simplicity and the experience as your team has always said, trying to make things invisible, but help if you would kind of lay out, there's a lot of announcements, but architecturally, there were some significant changes from the core, as well as, if I'm reading it right, it feels like the portfolio has a little bit more cohesion than I was seeing a year or so ago. >> Yeah, actually the theme around all these announcements is the same really, it's this ability to run any application, whether it's the most demanding traditional applications, the SAP HANA, the Epics and so on, but also the more modern cloud native application, any kind of application, we want the best platform. We want a platform that's simple, seamless, and secure, but we want to be able to run every application, we want to run it with great performance. So if you look at the announcements that are being made around strengthening the core with the Block Store, adding things like virtual networking, as well as announcements we made around building Karbon platform services, essentially making it easier for developers to build applications in a new cloud native way, but still have the choice of running them on premises or in the cloud. We believe we have the best platform for all of that. And then of course you want to give customers the optionality to run these applications anywhere they want, whether that's a private cloud, their own private data centers and service providers, or in the public cloud and the hyperscalers. So we give them that whole range of choices, and you can see that all the announcements fit into that one theme: any application, anywhere, that's basically it. >> Well, I'd like you to build just a little bit more on the application piece. The developer conversation is something we've been hearing from Nutanix the last couple of years. We've seen you in the cloud native space. Of course, Karbon is your Kubernetes offering. So the line I used a couple of years ago at .NEXT was modernize the platform, then you can modernize all of your applications on top of it, so where does Nutanix touch the developer? You know, how does that, building new apps, modernizing my apps tie into the Nutanix discussion? >> Yeah great question, Stu. So last year we introduced Karbon for the first time. And if you look at Karbon, the initial offering was really targeted at an IT audience, right? So it's basically the goal was to make Kubernetes management itself very easy for the IT professional. So essentially, whether you were creating a Nutanix, sorry, a Karbon cluster, or scaling it out or upgrading Kubernetes itself. We wanted to make that part of the life cycle very, very simple for IT. For the developer we offered the Vanilla Kubernetes system. And this was something that developers asked us for again and again, don't go around mucking around with Kubernetes itself, we want Vanilla Kubernetes, we want to use our Kube Cuddle or the tools that we're used to. So don't go fork off and build the economic Kubernetes distribution. That's the last thing we want. So we had a good platform already, but then we wanted to take the next step because very few applications today are self contained in the sense that they run entirely within themselves without dependence on external services, especially when you're building in the cloud, you have access, suppose you're building an Amazon, you have access to RDS to manage your databases. Don't have to manage it yourself. Your object stores, data pipelines, all kinds of platform services available, which really can accelerate development of your own applications, right? So we took the stand said, look, this is good. This is important. We want to give developers the same kind of services, but we want to make it much more democratic in the sense that we want them to be able to run these applications anywhere, not just on AWS or not just on GCP. And that's really the genesis of Kubernetes platform services. We've taken the most common services people use in the cloud and made them available to run anywhere. Public cloud, private cloud, anywhere. So we think it's very exciting. >> Tarkan, we had, you and I had a discussion with one of your partners on how this hybrid cloud scenario is playing out at HP discover, of course, with the GreenLake solution. I'm curious from your standpoint, all the things that Rajiv was just talking about, that's a real change, if you think about kind of the traditional infrastructure people they're needing to move up the stack. You've got partnerships with the hyperscalers. So help explain a little bit the ripple effect as Nutanix helps customers simplify and modernize, how your partners and your channel can still participate. >> So perfect, look, as you heard from Rajiv, this is like all coming super nicely together. As Rajiv outlined, with the data center, operations and services, DevOps services, to enable that faster time to market capable, that Kubernetes offering and user services, our desktop services on top of that classical industry-leading, record-breaking digital infrastructure. That hybrid cloud infrastructure we call today. You play this game with devoting a little bit, as you remember, we used to call hyper-converged infrastructure. Now we call it of the hybrid cloud infrastructure, in a sense. All those pieces coming together nicely end-to-end, unlike any other vendor, and from a software only perspective, we're not owned by a hardware company which is making a huge difference. Gives us tremendous level of flexibility, democratization, and freedom of choice. Cloud to us is basically is not a destination. It's an operating model. You heard me say this before, as Rajiv also said. So in our strategy, when you look at it, Stu, we have a three pronged approach on top of our on-prem, marketplace on-prem capable. There's been 17,000+ customers, 7,000+ channel and strategic partners. Also as part of this big announcement, this new partner program we called Elevate, on the Elevate brand, bringing all the channel partners, ISEs, platform partners, hyperscalers, Telco XPSs, and our global market partners all in one bucket where we manage them, simply the incentives. It's a very simple way to execute that opposite Chris Kaddaras, our Chief Revenue Officer, as well as Christian Alvarez, our Chief Partner Officer sort of speaking on global goal, the channels, working together tightly with our organization on the product front to deliver this. So one key point I want to share with you, tying to what Rajiv said earlier on the multicloud area, obviously we realize customers are looking for freedom of choice. So we have our own cloud, Nutanix cloud, under the XI brand. X-I, XI brand, which is basically our own logistics, our own basically, serviceability, payment capability and our software, running off our portal partnerships like Equinix delivering that software as a service. We started with disaster recovery as a service, very fast growing business. Now we announced our GreenLake partnership with HPE in the backend that data center as a service might be actually HP GreenLake if the customer wants it. So that partnership creates huge opportunities for us. Obviously, on top of that, we have these Telco XSP partnerships. As we're announcing partnerships with some amazing source providers like OBH. You heard today from college Sudani in society general, they are not only using AWS and Azure and Nutanix on-prem and Nutanix clusters on Azure and AWS for their internal departments, but they also use a local service provider in France for data gravity and data security reasons. A French company dealing with French business and data centers, with that kind of data governance requirements within the country, within the borders of France. So in that context we are also the service provider partnerships coming in. We're going to announce a partnership with OVHS vault, which is a big deal for us. And tying to this, as Rajiv talked about, our clusters portfolio, our portfolio basically running on-prem on AWS and Azure. And we're not going to stop there obviously. So give choice to the customers. So as Rajiv said, basically, Nutanix can run anywhere. On top of that we announced just today with Capgemini, a new dev test environment is a service. Where Rajiv's portfolio, end-to-end, data center, DevOps, and some of the UC capabilities for dev test reasons can run as a service on Capgemini cloud. We have similar partnerships with HCL, similar partnerships with (indistinct) and we're super excited for this .NEXT in FI21 because of those reasons. >> Rajiv, one of the real challenges we've had for a long time is, I want to be able to have that optionality. I want to be able to live in any environment. I don't want to be stuck in an environment, but I want to be able to take advantage of the innovation and the functionality that's there. Can you give us a little bit of insight? How do you make sure that Nutanix can live these environments like the new Azure partnership and it has the Nutanix experience, yet I can take advantage of, whether it be AI or some other capabilities that a Google, an Amazon or a Microsoft has. How do you balance that? You have to integrate with all of these partners yet, not lock out the features that they keep adding. >> Right, absolutely, that's a great point, Stu. And that's something we pride ourselves on, that we're not taking shortcuts. We're not trying to create our own bubble in these hyperscalers, where we run in an isolated environment and can't interact with the rest of the services they offer. And that's primarily why we have spent the time and the effort to integrate closely with their virtual networking, with the services that they provide and essentially offer the best of both worlds. We take the Nutanix stack, the entire software stack, everything we build from top to bottom, make it available. So the same experience is there with upgrades and prism, the same experience is available on-prem and in the cloud. But at the same time, as you said, we want people to have full speed access to cloud services. There's things the cloud is doing that will be very difficult for anybody to do. I mean, the kind of thing that, say Google does with AI, or Azure does with databases. It's remarkable what these guys are doing, and you want to take advantage of those services. So for us, it's very, very important, that access is not constrained in any way, but also that customers have the time to make this journey, right? If they want to move to cloud today, they can do that. And then they can refactor and redevelop their applications over time and start consuming these sales. So it's not an all or nothing proposition. It's not that you have to refactor it, rewrite before you can move forward. That's been extremely important for us and it's really topical right now, especially with this pandemic. I think one thing all of IT has realized is that you have to be agile. You have to be able to react to things and timeframes you never thought you needed to, right. So it's not just disaster recovery, but the amount of effort that's gone in the last few months in enabling a distributed workforce, who thought it would happen so quickly? But it's a kind of agility that, an optionality that we are giving to customers that really makes it possible. >> Yeah, absolutely. Right now, things are moving pretty fast. So let me let both of you have the final word. Give us a little bit viewpoint, as things are moving fast, what's on the plate? What should we be expecting to see from Nutanix and your ecosystem through the rest of 2020, Tarkan? >> So look, heard from us, Stu, I know you're talking to multiple folks and you had this discussions with us, end-to-end, and look for the company to be successful, customer partner intimacy, IP innovation, and execution, and operational excellence. Obviously, all three things need to come together. So in a sense, Stu, we just need to keep moving. I give this analogy a lot, as Benjamin Franklin says, the human beings are divided in three categories, you know? The first one is those who are immovable. They never move. Second category, those who, you know, are movable, you can move them if you try hard. And obviously third category, those who just move. Not only themselves, but they move others, like in a sense, in a nice way to refer to Benjamin Franklin, with one of our key founders in the US, in a sense as the founders of this company, with folks like Rajiv and other executives, and some of the newcomers, we a culture, which just keeps moving and the last 12 months, you've seen some of these. And obviously going back to the announcement day, AWS, now Azure, the Capgemini announcement then test as a service around some of the portfolio that Rajiv talked about or a Google partnership on desktop as a service, deep focus on Citrix globally with Azure, Google, and ourselves on-prem, off-prem. And obviously some of the big moves were making with some of the customers, it's going to continue. This is just the beginning. I mean, literally Rajiv and I are doing these .NEXT conferences, announcements, and so on. We're actually doing calls right now to basically execute for the next 12 months. We're planning the next 12 months' execution. So we're super excited now with this new Bain Capital investment, and also the partnership, the product, we're ready to rock and roll. So look forward to seeing you soon, Stu, and we're going to have more news to cover with you. >> Yeah, exactly right, Tarkan. I think as Tarkan said we are at the beginning of a journey right now. I think the way hybrid cloud is now becoming seamless opens up so many possibilities for customers, things that were never possible before. Most people when they talk hybrid cloud, they're talking about fairly separate environments, some applications running in the public cloud, some running on premises. Applications that are themselves hybrid that run across, or that can burst from one to the other, or can move around with both app and data mobility. I think the possibilities are huge. And it's going to be many years before we see the full potential of this platform. >> Well Rajiv and Tarkan, thank you so much for sharing all of the updates, congratulations on the progress, and absolutely look forward to catching up in the near future and watching the journey. >> Thanks, Stu. >> Thank you, Stu. >> And stay with us for more coverage here from the Nutanix .NEXT digital experience. I'm Stu Miniman, and as always, thank you for watching theCUBE. (bright music)

(Upbeat Techno Music) >> Announcer: Live from Copenhagen, Denmark. It's theCUBE! Covering Nutatnix.Next 2019. Brought to you by Nutanix. >> Welcome back everyone to theCUBE's live coverage of Nutanix.Next. We are here at the Bella Center in Copenhagen. I'm your host, Rebecca Knight, alongside of Stu Miniman, the analyst for theCUBE. We have two guests for this segment. We have Manoj Agarwal. He is the SVP of Engineering at Nutanix. Thanks so much for coming on the show. >> Thank you Rebecca. That's good. >> And Gil Haberman. He is the Senior Director of Product Marketing at Nutanix. Thank you so much for coming on the show. >> Thanks for having me. So, our topic today is Xi Clusters. These were announced at Anaheim, at .Next back in Anaheim. Gil, why don't we start with you. Describe the business problems you were hearing from customers and how these Xi Clusters are designed to help solve them. >> Gil: Sure, first thanks for inviting me. I'm a big fan of theCUBE. It's so great to be here. To your question, at Nutanix, we've been working with customers on the vision of Hybrid Cloud for a number of years now. And the different challenges have evolved over time. Initially, there were pockets of public cloud adoption where customers wanted to simply find a way to operate across multiple clouds. But today, the challenges are different. Now, as customers are looking to adopt business critical applications that span private and public, bursting and migrating applications, there's a strong need for consistency across environments. And we gear around consistency around 3 aspects. The first is infrastructure. The second is operations. And the third is the consumption model itself. From an individual perspective, what we keep hearing is that the same VMs and applications must be able to work across environments, without significant replatforming or retooling. From an operation's perspective, cloud engineers truly need a way to utilize the same practices, integrations, in work that they have done on their applications for many years, across multiple clouds. So there's a need to sustain the same practices across these multiple clouds. And finally from a consumption model perspective, there's a need to have a platform that drives the same level of consistency in terms of licensing and software across different environments. And for that, we at Nutanix have to evolve to empower operators to be able to address all of these needs of consistency across private and public. >> Now, I would like to add something to it. You just think about three years ago. The entire world was talking about "Everything is going to be public cloud." And very soon, all these CIOs also realized that it's not going to be just public cloud or just private cloud. It's going to be Hybrid. And we ran a survey with 2,700 IT professionals who participated in the survey, and what we learned mainly 91% of them, they said hybrid is ideal. And the second thing that was not also a surprising thing was 94% of them, they said the app migration or app mobility is going to be the key. And then we look at that option like "How are you going to adopt?" And that was also strikingly similar, like what we see currently maybe 18% or so, that they are into the hybrid world and getting onto close to 41% or so in the next 24 months. >> Yeah, but Manoj, I'm glad you brought that up. When I talk to users, the thing that they're concerned the most about are their applications% and their data. And in IT forever, migrations have been a challenging thing to do and it was usually, you set up a migration and it takes you weeks or months to do it. Today, migrations aren't even going to be even a one time thing. If I'm moving from one cloud to another, if I'm moving from private to public, or even public to private. I need to have some flexibility to what I'm building. How has that informed how you're building your architectural designs? >> That's a great point. In fact, we always feel that architecture matters, and why the fundamental technologies that we are building should help. Two things that I'll say. One is the data replication technologies that we have built and strengthened over time. Plus the second thing is the network. If you get the network right, then you are very slowly there. And we had been reflecting on the data side, you know. 10 years of journey and data replication technologies like we have built. Networking we have been very hard at work on that front also in the last three years or so, with the building of Xi Cloud. We'll see and hear more and more, especially in the context of Xi Cluster. What you see is that we have done the ready integration with AWS ETCs. Thereby first of all all the services that exist in AWS. It's available to the customers with their app, running on XI Clusters without changing anything there. >> This is a competitive market so let's talk about differentiation. How do you see the product as completely different from your rivals and then how are you positioning it to your customers? >> Yeah. I'll go back to again the same thing. Architecture matters. We were not the first ones to go out with a hybrid converse like in 2013. There were a lot of competitive solutions that existed at the time. But we took our time. We wanted to make sure that we do it right. We do provide choice to our customers. That's where we matter. As we are building out solutions, again going back to the four principles. Applications sort of require change. You don't require an IPO presence to change, so when we are building the solution, we are making sure if you want to pay for private cloud, on-prem our service provider. Or you want a public cloud. Any of the big cloud players or this new cloud, that you have a common architecture underneath. You have the same management plain with the prism. You can really orchestrate, and manage the entire infrastructure. You have the flexibility in terms of the networking. Other services that you want to go and use, you have the choice of wahtever platform also. Like something that we don't want you to go and change if you don't need a change. Lastly, I would say, on the business side, we do want to give the smarty cloud world the flexibility for the customers to bring a cloud of their choice and if they want to switch, they should be able to switch with one click also. >> Yeah. Gil, I'm wondering if you can actually explain to our audience one of the challenges here is deploying unbared metal is not something that anybody can just do on the public clouds. For AWS, the first solution was actually VM ware on AWS. They had to develop that but they're now opening that to be able to use. Can you walk us through where we are with the cloud providers and that's I think part of the reason why this isn't yet generally available. Indeed, AWS has been the first to open bare metal and this is really the path for us at Nutanix to make clouds invisible as well. We worked with a number of platforms on Prem and now we want to extend that to public cloud and having an ability to actually access bare metal is the first step in doing so. Beyond that, what we've done is what we believe is the hard work of making things very simple to drive customer delight. And so what we've done is integrate into AWS rather than just running on top of AWS, inside existing accounts and VPCs of customers and the outcome has benefits on both technology and business perspective. From the technology perspective, cloud operators can see all bare metal as well as cloud native services in one place, one inventory. And we believe that this type of topology will provide better performance. And then on the business side, this allows us to do a couple of things. The first, if you are an AWS user like most of our customers, they can use AWS credits for that bare metal infrastructure. At Nutanix, we are now able to evolve our services to provide hybrid licenses, so our licenses would eventually be portable. And so you see how we are gradually building towards this portability across multiple clouds, AWS being the first cloud. >> Yeah, it's great to see Nutanix- We've seen a few other companies moving towards that model because if I'm software and truly agnostic, you should be able to have it across those environments. I believe Solidfire a couple of years ago started doing some of the things; A couple other companies. So the X in AWS sounds like it will be first. We know Google has been the partner of Nutanix for a while. Could you just give us where are we with Google and Azure? Kind of to round out the big three. >> Sure, so we have started to work with AWS and we have announced early access now inviting customers to sign up with us to get access. We are also actively working with Azure to figure out how to together bring better bare metal services and the type of software on top of that. And of course, we believe that other cloud vendors are going to open this up as well and Google Cloud being a close partner of ours is an important part of that strategy as well. >> And we are doing something with Google already as you know. We have integrated the entire stack using their nested vertilization technologies, like running on their vertilization the HB which is nested. Today, we run a lot of our customers prospect they run. The test, our experience the entire solution on Google test prime. We have brought out more than a thousand users every month, that they access it. So it's a journey, like when they have the full bare metal, you can see a lot more but we are very engaged with them. >> I want to talk about the future now and have you looked into your crystal ball a bit, 6, 10, years from now. What do you see- This is such a fast changing environment but how do you see the cloud evolving and then how do you see Nutanix? What role does Nutanix play? >> Last 10 years, it was all about how we bring public cloud into the private cloud, right? Next 5, 10 years when you think about it is all how do we really make it hybrid. The experience that what customers have come to expect in the last 10 years. You can go and pick any kind of platform on which you want to run the same stack. You won't need to worry about it. Something similar that needs to happen and the underlying architecture of technology which will go and drive that is going to be data mobility, same control plane that can go and extend this smarty cloud. This story by the way resonates very very well with the customers because it's not easy to get your IT for support, to get trained on different cloud technologies also because the talent things cost there. And if you can go and teach them one interface and have them run with the choice of infrastructure or the back form or the cloud, that's what we think we can make a huge difference for the customers. >> Yeah, so I want to make sure I understand when talking about your hybrid or multicloud strategy, we've got Xi Clusters help you get in and matches what you have on sight. Have you had a conversation about Kubernetes yet? Where does Carbon which is the Nutanix Kubernetes fit into this overall discussion? Is that just part of the platform that gets baked in and therefore we don't need to talk about it or am I missing a piece? >> That's a great question because the beauty of what we're talking about is that we bring the entire software and the entire platform with us wherever we go. Part of that stack is carbon and calm. We need the ability to have both traditional applications alongside modern applications with Kubernetes. Even hybrid applications that include some front end that might be containerized, maybe back end that is not yet containerized. And all that, everything that we've been doing on-prem, can now be moved into any other public cloud we provide. >> It's part of the compute, right? You got the VMs, now you got the containers. It's part of the backbone. >> So yeah, we've heard from some people say that Kubernetes is just the new containerized compute. We don't need to talk about it and I'm okay with that, because it's just in there. >> Yes. Absolutely. >> Excellent. Well Gil and Manoj, thank you so much for coming on theCUBE. >> Manoj: Thanks so much for hosting us. >> Gil: Thanks for having us. >> I'm Rebecca Knight for Stu Miniman. Stay tuned for more of theCUBE's live coverage of .Next. (Techno outro plays)

>> From the SiliconANGLE Media Office in Boston, Massachusetts, it's theCube. (techno music) Now here's your host, Dave Vellante. >> Hi everybody, this is Dave Vellante and welcome to this special Cube Insights, powered by ETR. We've been running these Breaking Analysis Segments and today we're going to talk about some spending data that shows that there's continued interest in hyperconverged infrastructure. So we've been running these segments over the last several weeks with our partner ETR. They've got a database of about 4,500 IT Practitioners and CIOs. They go out quarterly and ask spending intentions. So we've been sharing that, along with our opinions. These are completely independent segments. I want to disclose that a number of the companies that we're talking about today: Nutanix, VMware, Dell EMC, Cisco, HPE. They sponsor theCube, but they have absolutely no input into editorial. They don't affect our opinion in any way, shape or form. So let's get into it. I'm here with Stu Miniman. Stu is an expert in this field. He's covered the space. Stu, let's look at some of the fundamentals. What do people need to know... Alex, if ya put up the slide, Stu, maybe you could talk to it. >> Yeah. Dave, thanks. I've been watching you have some fun with this. I enjoyed swimming in some of the data here and as you know, Dave, we've been watching since before hyperconverged infrastructure, or HCI, was a term that everybody talked about. We've been looking at how these hyperscale trends are going to impact the Enterprise. We put out our server SAN research years and years ago, so we know all these companies really well. And despite the latest AI and cloud and everything, the data shows, HCI, the simplification of the data center, building out what we would call True Private Cloud is important today. So right, we wanted to know when you look at the data, first of all, how are the vendors doing? Who are the leaders in this space here? There were a whole number of startups that came in this space. When we first analyzed the market it was companies like Microsoft and VMware that owned the operating system we thought would be hugely important. If you look in the big names this environment: Dell partnered with everyone, of course they bought Dell, bought EMC, which included a stake in VMware. What's that relationship with Nutanix? How is that shaping the market? As well as how is cloud impacting things? Both from a spending standpoint, has cloud sucked away revenue from HCI as that specter has overhung everybody in the IT space? And also, how does HCI fit into multicloud and how does that fit? >> Okay, great. So thanks for that setup, Stu, now let's get into some of the data. Alex, if you bring up the slide, the next slide. This is spending intentions for Nutanix, VMware and some other vendors. I'll go through that. But it's basically showing Nutanix and VMware are fighting it out. You know they're in this internecine battle and in social, and (chuckles) there's a war goin' on, because there's big money to be made here. So for those of you who are familiar with these segments, this is data from Enterprise Technology Research, from their July 2019 Spending Intentions Survey. So they're asking about spending intentions for the second half of 2019. The end of the survey, out of the 4,500 people in the panel, 1,068 responded to this survey. So on the left hand side you see the vendors: Nutanix, VMware with vSAN, Dell EMC with VxRail, specifically. Then SimpliVity, and then Springpath, or Cisco. So what the chart shows is what we call, Net Score. And net score is calculated by taking the red, on the bar, which is, we're going to leave the platform, that's the dark red. The lighter red, which is, we're going to spend less in the second half. The gray, which their spending's going to be flat. The dark green, or the evergreen, which says, we're going to increase spending. And the lime green, which I'm going to add to the platform. You take the green, minus the red, you get net score. Higher the net score, the better. You can see, Nutanix and VMware with vSAN are leading the pack. And then we'll go through that. But then you see, Shared Accounts. That's the number of indications for spending that they received out of those 1068. So Stu, what is this data telling you? >> So first of all, Dave, it confirmed kind of the general market share numbers that we hear out there. The vendors that track that on quarterly. VMware has the most customers, has the largest revenue, and their largest partner for that, of course, is Dell. VMware and Dell go to market, joint product development, joint engineering, joint go to market and it's the biggest piece of vSAN, so that's where we specifically wanted to look at the VxRail. And vSAN and VxRail, doing very well. They're adding new customers; was interesting to me that you saw VxRail kind of ramping up a little more on the, attracting new companies, but also looked to be losing some on the tail end of the dark red. As opposed to vSAN in general, is a little bit more stable. We know how many thousands of customers they have out there, and Vmware's a software story as opposed to VxRail is that full appliance. Nutanix is the second horse in this two-horse race that we're really talking about here, from HCI. There's some discussion in the marketplace after two quarters being down, is Nutanix showing weakness? What's happening there? The most recent quarter announcement was that Nutanix is doing well, seems to... They had a little bit of change as they're going through their move to a software model and sorting things out with sales and marketing in their channel. The data here shows that the second half of the year looks good for Nutanix. So to some of the questions I asked in the first slide, Dave, Nutanix and VMware, of course the clear leaders in this space. SimpliVity, which was of course bought be HP, Springpath which is the hyperflex from Cisco, are far behind those two out there. And it seems that even though Dell and VMware are fighting, very much with Nutanix, that is not heavily dampening Nutanix's from the respondents in this survey. >> Okay, and just a word on the data, so you see 184 shared accounts for Nutanix, 174 for VMware and down the line. Only 42 for SimpliVity and only 18 for Springpath, and Cisco. It's an indication of the size of the install base, obviously the more shared accounts, the more mentions, the larger the install base. Again, they're statistically significant; ETR does a very good job of that. Let's look Stu, at... Oh, actually I want to make another point here. So how are these net scores? Well let's put 'em in context. The hottest net scores we've seen recently are: Snowflake, and UiPath, with 80% plus, net score. Okay, so that's really, they're off the charts, they're growing like crazy. We saw Salesforce with 55%, so, and Workday sort of in there as well. Companies that are growing share. So SAP in the 30% range, and so you see the Dell EMC, VxRail, that's kind of holding serve. It's not like, dramatically gaining share, but they're growing a little bit and then-- >> And I think it's a lot, Dave, it shows to the maturity of this market. HCI is not new, both Nutanix and VMware have thousands of customers, specifically with V's then we're talking VMware. So it was more, when I saw some of your charts, Microsoft has a similar net score. >> Right >> Well liked, good install based, still growing and the like. And brings in the discussion of when we did some cross section of the analysis looking at cloud companies and how does this impact their public cloud spend; is this detracting if this customer's also doing public cloud? And the long and the short of it is VMware and Nutanix are pretty much the same if not actually a little bit better when you talk about a customer that's looking at their overall cloud spend. So to me that really signals that both VMware and Nutanix are doing a good job into how their solution fits into the customer's overall hybrid cloud strategy. >> All right, let's take a look at the next slide, which talks to time series. So this is hyperconverged infrastructure spending intentions again, for the second half of 2019, over time. So the July '19 Survey you can see is the most recent one. We go all the way back to January '17 and you can see Nutanix on the top, VMware or vSAN on the bottom. We just selected those two. We're just repeating the net score and the shared accounts. And you can see these things tend to bounce around a little bit. You can see Nutanix maintains a lead, but the market's startin' to converge. These two companies are coming together. We hear a lot about vSAN doing very well, it's kind of held on. You can see a slight downward pressure in July, in the July survey. It's unclear what that means. That could be an indication of just some uncertainty in the marketplace. Some economic macro concerns. Tariffs, potential headwinds there, so there could be some uncertainty there. But what do you takeaway from this slide, Stu? >> Yeah, first of all right. As you show, Dave, VMware is a bit more steady, Nutanix gone up for bit and come down. Both of them stayed relatively stable. Somewhere between kind of the 45 and 55 lately. A little bit, if you look at the overall trend, Nutanix is down. VMware could surpass them from the net score in the future, if this trend holds. But both of them doing quite well. When you looked at all the other vendors in there, of course the scale is just showing 40-70%, if you put all the others, which are down much lower, you can see once again, that kind of the clear leadership. These two companies, just strong lead. Does not look like there any challengers in this space that are ready to be a clear number three yet, in the market. >> But Nutanix at one point had no competition. >> Yeah. >> Okay, now vSAN comes in and of course-- >> Oh no, absolutely. So no, SimpliVity and Scale Computing, and there were a whole host of startups. There's all the brand new startups in the space. Everything from little companies like Diamante, Pivot3, who was around doing this before it came. So there's always been a lot there, but Nutanix is the one that separated from the pack. The only one in this space that's gone IPO. But VMware's there, Microsoft won that, they rebranded their Azure Stack HCI for what they put in the data center last year. So expect Microsoft partnering with all of the big server manufacturers to push farther into HCI, but really has not directly impacted this market too much, just yet. >> But there's definitely been some pressure on Nutanix from an earning standpoint, the stock's been hit. You've had some executive departures. There's some rumors about acquisition with Google. Your thoughts on-- >> Yeah, definitely. So John Furrier just had Dheeraj Pandey, the CEO of Nutanix, in our Palo Alto studio, leading up to the Copenhagen show for Nutanix that I will be at. Sure. Sunil Potti who was basically the number two at Nutanix, is now working for Thomas Kurian, TK, over at Google Cloud. My indication from what I hear, he is not over there to help broker a deal. Sunil had a great run at Nutanix, there was a clean break there, but there is a mostly new executive team at Nutanix. Now a couple of years past the IPO and the team at Nutanix, they have their platform. The have a bunch of SaaS offerings that they're doing there. Do they have a relationship with Google? Absolutely! They had Diane Greene at one of their events a couple of years ago. They did joint engineering. But I actually saw that engineering effort cool off a little bit in the last year or so since the new regime came on in Google Cloud. So does Nutanix have a lot of Enterprise accounts and know how to work with the Enterprise and could that be a boon to Google? Absolutely! But the personnel of a Nutanix executive over at Google, and Brian Stevens who's the CTO of Google Cloud being on the Board of Nutanix? I do not think that that is telegraphing that an acquisition is going to happen. It could. We see lots of big acquisitions. Nine or 10 billion dollars from Nutanix could be interesting for Nutanix and help them get in a lot of places and help Google. But Dave, I goin' on record say, I don't think it's going to happen. I don't think Cisco is going to buy Nutanix. Infrastructure's not the real push for Chuck Robbins and that team. And at the Google Cloud event, Dave, that we were at, we saw Sanjay Poonen from VMware up on stage touting how deeply VMware was going to partner. So both VMware and Nutanix are partnering with all of the clouds. VMware of course has a very deep relationship with VMware. They're going deeper with Google, they are even partnering with the old enemy of Microsoft, so I would give VMware definitely has a deeper and more public relationship with all the public cloud providers but Nutanix is also partnering and expanding their portfolio to give themselves good growth beyond just the core HCI market. >> HP's another one. So Nutanix and HPE are workin' together. Kind of the enemy of my enemy is my friend. Nutanix was not at VMworld this year; they're kind of booted out. So they belly up to HP. >> Yeah, HP loves having, they have their, "As a service offerings," and Nutanix is one of those as well as Nutanix can sell the HP. So as the, right, the Dell relationship is likely going to die down over time, as Michael Dell on the team, want to sell more Dell hardware with VMware software. HPE is another... And they also partner with Lenovo on the Nutanix side. >> All right, Stu, bring it home. What are the key takeaways on this cube Insights. >> Okay, so HCI, who is a two-horse race right now. There are interesting companies to look at beyond the two, but if you want to understand who the leaders are in the space it is: VMware, especially with their VxRail and Nutanix, are the two leaders in that space. Really looking and understanding how they're expanding into multicloud and hybrid cloud solutions. VMware very much with their VCF offering, which packages vSAN to go into the VMware cloud offerings. And Nutanix with an interesting strategy, both with how they really spread some of their services like what they're doing with Xi Cloud, as well as some SaaS offerings, which some of them really have a disconnect. Not in a bad way, but just are not tied directly to the hardware. What the infrastructure companies have tried to do for years. Both of them, VMware's done tons of acquisitions. Nutanix has done quite a few acquisitions too. >> So your second point here, what's the impact of Dell VMware versus the Nutanix battle? You say not a significant impact on spending intentions yet. I mean there's clearly some evidence that those two markets are comin' together, that VMware's pressuring Nutanix. But why do you say, yet? What do you expect? I mean is it the OEM deal with Dell? >> It's the OAM relationship. There is huge pipeline of Dell hardware with Nutanix software and they're at loggerheads. So absolutely, the Dell family: Dell, EMC and VMware are doing all they can to dial that down. So they put pressure on the channel. And even some of the most loyal Nutanix channel partners that work with Dell, have had pressure to do more and more VxRail. So I expect it to have impact, but just as, Dave, I'll dial back the clock. You probably remember when EMC had a relationship with HP and HP killed the OEM of EMC storage. EMC stormed back and got a lot of those accounts. Same thing happened when EMC and Dell broke up a couple of years before the acquisition. So Nutanix is storming to go with HPE as one of their server partners, and (mumbles). So can Nutanix keep their growth and momentum going as Dell is no longer their biggest partner? >> Well, they're fighting a two-front war. They've got one with Dell VMware and they're also fighting the war with the public cloud guys, even though they're partnering with the public cloud guys. All right, they're sort of taking that cloud model but of course it's on prim. So you say how this public cloud affects HCI spending; not a significant impact on spending intentions yet. Can I infer from that that you do expect there to be pressure on that second front? >> Yeah, so as I've talked about before Dave, when we look at VMware and VMware gives the VMware cloud in AWS. Some say, "Great, that gives me a nice path to be able to use public cloud. But maybe I don't need some of this VMware licensing and software in there." The question for Nutanix is very similar. What services do they have? How do they become more sticky in customer environments? And absolutely, they're driving a roadmap for that in working with their customers. >> Well the thing about Nutanix is that customer's really happy. The customer's really like Nutanix. They like the simplicity. I've talked to a number of Nutanix customers that are very happy in that regard. And they have a leading product in that regard. But they're aiming at the multicloud space and can they play there? >> And Dave, you make a really good point. The killer use case, what did HCI deliver? It delivered simplicity. Today, if you talk about public cloud in general or even hybrid or multicloud, (chuckles) simplicity is not how you would describe this. So can the customers, the companies that did HCI, so, VMware, Nutanix, HPE and Cisco, they're all fighting for that hybrid and multicloud environment. And if they can help deliver simplicity of management, simplicity of leveraging my data, they can be successful in that space. >> Okay, so you're sort of positive on the multicloud, their position in multicloud. Even though they're not one of the big five. >> Yeah, and the good news for a Nutanix is that they're growing off of a much smaller base then say VMware, when you say they have five or 600,000 customers. Hey, how big of an impact will public cloud have on them? >> All right, so we don't pick stocks. We're not making recommendations. (laughs) But, do you feel like it's overdone, that it's undervalued? Independent of the macro. Do you feel like the pressure on Nutanix is warranted, or do you feel like it's got legs? >> So I feel Wall Street tends to over adjust when they go through things. When I talk to my friends on the Wall Street stuff. Definitely Nutanix took more of a beating probably then they should have. But they had two quarters that weren't great. And some of that was the management changes, they blamed that they couldn't hire sales and marketing fast enough. Something we'd asked, if you're a company in the Valley and you've gone from a few hundred people to a few thousand people. How do you keep adding good quality people? That's challenging. So yes, I think we've actually seen Dave, in the last week, or so Nutanix has been one of the fastest growing stocks in the tech market. So they're adjusting some. So I still think Nutanix has plenty of room for growth. The question is, what's their path to say, two billion dollars? Or is it an exit for 9-10 billion dollars down the road? >> All right, Stu, some great stuff. Thank you for that analysis. And thank you for watching this episode of theCube Insights, powered by ETR. This is Dave Vellante, for Stu Miniman, we'll see ya next time. (techno music)

Live from London England, it's the CUBE covering .NEXT Conference Europe 2018 brought to you by Nutanix. >> Welcome Back to the CUBE here from London. Our reporting of Nutanix NEXT 2018 in Europe. With me here is Frans Coppus. You are an ICT manager at  Driessen? I'm very curious. Driessen is a customer of Nutanix? I understand that you develop HRM software among other things? >> Tell me about Driessen.  How does this work? >> Yes, well Driessen is a family business. We are a business service provider for the public sector in the Netherlands and the Driessen Group is actually a group of companies that make employment possible. We do that through the offering  of several different services. You should think of connecting people to work, so a staffing function, but next to this , we also develop software and services to take over processes for other companies or to make processes easier. >> That sounds a bit like on one hand you are a Employment Placement company, helping people get work, but on the other hand, you also seem to do something with software and the delivery of your services as a software product. How does that work? >> Yes, that's right. We deliver services to make other companies' processes easier.  You should think of payroll and things like that, but also all other kinds of processes for which we mainly use the digital services that we develop ourselves. For example, think of  a package like AFAS profit , where AFAS profit falls short on some functionality that customers would want to make use of. We can  help those customers to provide that extra functionality to improve processes. >> Yeah, that sounds like you are software development shop. You develop the software in-house? >> Tell me more about that.  Do you do this on-premise? Do you use the cloud? What tools do your developers use? How does that work? >> Well, have a team of about 25 in-house software developers.  They are spread across a number of our different companies , and the software we develop runs  partially on prem  and partially also in the cloud. >> Yes, and I understand that you have been doing this with Nutanix for a year, year and a half to provide a foundation for your infrastructure. Can you explain how this works?  What Nutanix products and services you use? What are some of the benefits? >> Well, we started looking into modernization  of our data center at the beginning of last year. That was how it started. Then we looked further into things. We already had some interest in Nutanix. We did some more research and  ultimately we  decided to choose Nutanix and basically slowly replace our entire data center  with Nutanix. So we installed some hardware  but subsequently we also selected AHV as the hypervisor layer. We came from VMWare so we basically migrated everything. I must say that the implementation itself went very quickly. The implementation of the Nutanix environment  was really a piece of cake and then we started to migrate our VMs to the platform one-by-one.  And this year we completed this process. Currently, our entire data center is running on Nutanix.  What were the problems you were hoping to solve? Well, you should mainly think about scalability.  We liked the fact  that we could start small with Nutanix  but when needed we could scale easily. Performance was an issue in the previous environment, which we also completely resolved. I think the biggest challenge we had was to make things easier. We had created a pretty complex landscape over the years. That was actually the main reason why we ultimately chose for Nutanix. Simplification of the whole landscape. Easy to manage, especially also  since we are using a mixed solution. Partially on- prem and partially in the cloud. With Nutanix this is easy to manage. >> Yeah, exactly.  Since you are an ICT manager. I can imagine that your role also changes? I assume that at first, the main  focus was on infrastructure, as it was difficult and where attention was needed. How has your role changed over the course of time? >> Yeah, that's exactly right. That role is changing.  Initially, you are very focused on the operation to keep all the "balls in the air." All sorts of things you actually don't want to have to deal with.  And this is what we are now seeing. We are able to manage the environment with fewer people.  That means you free up more time and together with the management team,  you can use this this to look into how we can improve our services How can we improve our availability?  And all of this at equal or lower cost and with less effort. >> Yeah, and I assume, to use the word " digital transformation", is also a challenge for you? You want to move closer to your customer.  How do you do that as an IT department? How how move closer to the business internally at Driessen, but also external customers? How does that work? >>Well, the needs of the customer is often translated by the Business to the software developers. What is important for us is the time-to-market. The development life cycle is pretty rapid. We work a lot on the basis of orders and as such it often goes paired with requirements that we need to adhere to. So, time to market is very important in such cases. With Nutanix we are actually able to deploy software faster and offer new features to our software engineers  who in turn can use this. >> Yes, so you are saying that your software developers can thus get closer to the business. They require less time to lay the groundwork, as it were.  We are here at .NEXT, we have watched the  keynotes, heard a lot announcements. Nutanix started as an infrastructure. A so-called modernization of what you had. Meanwhile, there are 15 products. It has become much more gigantic. When you look at the growth of the amount of people walking around here, 3,500 people.  I am curious, how are you looking at this? You will be walking around here for a few more days. You've watched the keynotes. You see the crowds. What is your impression of the event? >> Well I must say, "very cool!" Last year I went to Nice, That was a very good conference. That was also the reason that made me think "I coming back this year for sure". During the first keynote, it was really cool to see, how much bigger the entire  event has become but also the success of Nutanix. Last year, in Nice, I spoke with  some of my peers who were still 't doubt whether they would transition to Nutanix. Well, I told him about our experiences and told them I would recommend it for sure including the use of AHV as hypervisor.   You are starting to feel how everything has matured. So much more has been added. I was impressed with what products  I have seen over the last two days along with the simplicity and maturity of the products  Really super cool to see.  What really stuck with me.   What really impressed me was Frame. Frame is really super cool. It's also something we are for sure looking at to use. In addition, Beam looks very appealing. I must honestly say, we now have our entire data center on prem. Also our DR environment is on prem, because when we made the decision, there was no Beam. If I would have to make the decision again, I would absolutely choose Beam to help solve DR. There too, the simplicity with which you can manage it is really cool to see. Well, in the future we continue  to monitor such developments and I am sure that we will work with  products such as Beam and Frame in the future. >> The made the announcement of the core product. The core products to essentials, which is a bit of the uplift. Those are the next small steps you can take. And then you get enterprise. Thats where you are especially finding the new product offerings such  SaaS products , the Xi Cloud , and what I am curious about is the following. I also know from Nutanix from the perspective of infrastructure? I have seen them grow. And looking at all the announcements they have made. All those products they have developed  What was for you the lightbulb moment?  The moment where you thought "when I get home after the weekend,  I am going to use this?" I want to learn more about this!"  What is that one product from which you say  I want to get started with that!" >> I think , if I had to choose it, then I would say, "I will definitely get started with Frame"   to look at how we can provide our colleagues with a workplace when they work remote or things like that. >> Yes, >> Is also one of the issues that you are trying to solve using Nutanix? Traditionally, Nutanix did lots of VDI. Still does a lot of VDI. Is that something that the Driessen Group is moving towards? >> Yeah, well at least for a part of our colleaguesI, I see ways to implement Frame as a substitute for a VDI environment. >> Yes. Yes. Absolutely. Exactly. Yes. Exactly right.  >> Also, I was really...  and I did not realize that  they were working on this, but Nutanix  is building its own Cloud I am very curious what this will bring.  Especially if this will seamlessly integrate with your on prem environment. At the moment, I find that to be the strength of Nutanix?  The fact that you can  you can easily switch between on your own prem Nutanix environment or a cloud environment. Well, if there is also another Nutanix in the Cloud option, that would be cool. Exactly. >> All right, last question. You employ developers  Today, we also saw some announcements  during the keynote around cloud-native as it is called so nicely So Karbon, databases in the Cloud with Era with Buckets, S3, S3 storage. Are these things from which you think,  "my developers will make use of this?" Yes. Yes. My developers are all knocking on the door.  They want to  get started with containers and other stuff. So that's very good to hear that Nutanix is also diligently working on that and how it will integrate within Nutanix.  So my software developers will be very happy with that. >> Yeah, great!  Well congratulations! That really sounds like a top store!. A very nice story about Driessen. how you are using Nutanix. Well, I wish you success with your next steps that you will undoubtedly take. That was it for now.  Thanks for watching the Cube together with Frans here in London Til next time.

>> Live from London, England, it's theCUBE covering .NEXT Conference Europe 2018 brought to you by Nutanix. >> Welcome back to theCUBE's coverage of Nutanix's .NEXT 2018 here in London, England. I'm Stu Miniman, my co-host is Joep Piscaer. 3500 here in attendance. Actually in the closing keynote, we just listened to Dr. Jane Goodall talk about her life's work, her next, where she's going. Really powerful content here to help round out what we're doing. We're actually really thrilled to have as our penultimate guest to the program Chetan Conikee who is the founder and CTO of ShiftLeft.io, a customer of Nutanix based out in San Francisco. Thanks so much for joining us. >> Thank you very much for having me Stu and Joep, pleasure. >> So Chetan, ShiftLeft.io, tell us a little bit about that. We love to hear from founders. What was the why, what did you see out there? What were you looking to do and then we'll get into it from there. >> Absolutely. We founded ShiftLeft back in December 2016. ShiftLeft is a venture-backed application security company. I co-founded ShiftLeft with the Chief Products Officer of FireEye and one of the core architects at Google. So our reason and emphasis to build out the security company was to essentially make security relevant to what they call as cloud-native applications. So ShiftLeft by virtue of the word meaning shift security to the left is bring securities awareness to the early stages of the software development lifecycle. As engineers write code, we have built a system that in a matter of minutes converts code to a graph, a graph akin to a social network. Almost like a social network graph except that it's connecting all the functions and variables in your code that represent the application. Now using that graph, we extract vulnerabilities that might exist in the code. Now as we know, engineers are focused on velocity, developing software and servicing their customers. So often security gets left behind, which is why we have built this autonomous agent that takes the data that we extracted during coding and protect the application in Runtime from imminent threats. >> Okay, we could spend an hour talking about this. Security is one of the hottest spaces, one of the biggest challenges in kind of modernizing this multi-cloud era, cloud-native absolutely. Maybe you'll be at theCUBE Con show in a couple weeks. We can talk even more about that because oh boy, so much to go there but you're a startup and what brings you to Nutanix is I guess the question. Come on, cloud-native, you should be born in the cloud. You're venture-backed, they probably don't want you spending lots of money on infrastructure. So maybe connect the dots with us as to how you ended up with Nutanix. >> Absolutely. The core ethos of ShiftLeft is observing, observing threats in real time and observing vulnerabilities that might exist in code. Observing means we have to make sure that our own infrastructure is protected from threats and at the same time we provide a high accessibility to our customers. Which means that we have to observe our own infrastructure which is why we subscribed early on to a Nutanix product called Epoch. Because the core essence of Epoch is to provide observability to infrastructure. Our infrastructure is very complex because every time engineers write code and commit code into GitHub or any other so-called management system, we react to that and at the same time if any threats are applied, when they deploy that code in production, we react to that as well. So it is important for us to maintain our uptime which is why we use Epoch to continuously observe our system for faults or any threats applied upon our own system and Epoch provides us that service, that service because our infrastructure is very complex. It is comprised of at least about 80 to 100 micro-services deployed in a cloud-native infrastructure. Now all these micro-services are working in concert with each other every time it receives an event, an event of a code check-in from a customer's ecosystem or any threats applied to our customers' infrastructure deployed in their private data centers or their cloud infrastructures. >> So let me get this right. You're a Nutanix customer but I'm guessing you're not the typical customer, right? You are not running their appliance in the data center but you're using different products. So I hear you mentioned Epoch which is observability. So that gives you insight into the system you are running. But to clarify, you're not running Nutanix in your data center? >> Absolutely, we are a cloud-native company. Our infrastructure entirely runs on Masels and Kubernetes which is deployed on AWS, Azure and GCP. So we are a multi-hybrid cloud ecosystem and Nutanix Epoch product is agnostic of the servers because it's a software-defined product that enables us to place hooks in the appropriate places of our software-defined or our software stack and then provide us the necessary observability. Observability from the perspective of latency, throughput or essentially any impact induced upon our infrastructure. >> So you are using it to monitor the sort of applications you're running in micro-services. So this is not even about infrastructure monitoring. This is about your application, it's uptime, error rates, thresholds, stuff like that. >> Absolutely because our system is comprised of a dense micro-service mesh which means that if one micro-service is down, it impacts a set of other micro-services which in turn impacts the customer as well. So what we do is try to identify cause and effect, correlate events and understand this dense and complex infrastructure. Nutanix Epoch has this cloud map feature that enabled us to dynamically plot the entire map of our infrastructure. This is almost akin to Google Maps because you can plot a from and to destination but upon that you might have traffic contention, accidents, tolls and everything else you can think of. So this is a similar situation with very dense and complex infrastructure as well, meaning if one service is down, it has this ripple side effect on other services as well. >> Yeah, I'm actually glad we got to interview you towards the end of our coverage here because one of the things we've been looking at is Nutanix has gone from basically two products to now they have a much broader portfolio. Some of those have been organically and some have been through acquisition. So Epoch which I believe is now under the Xi family, so Xi Epoch, I interviewed back in New Orleans, it was Netsil, Netsil came in through the acquisition. So I believe you've been using it since it was Netsil. >> Absolutely. >> What have you seen? I love kinda your outside viewpoint as to what's that meant to the product? Besides being renamed, what's the same, what's different and how do you see that impacting Epoch going forward? >> Absolutely, great question. For the most part the core product hasn't changed as much. The vision has always been carried on from what it used to be to what it is today. But the product has improved significantly. The user experience has improved significantly and now what they have is the foundation of Nutanix which is critical because there are various other product lines in Nutanix that can serve us better as well along with Epoch and we are looking forward to understanding what Beam is, what X-Ray is and there are various other product lines along with what we are already using at this point. >> Great, so I'm curious your experience here at the show. What brought you to the show? What conversations have you been having with your peers? We talked to Nutanix about what they're doing with the developers and about the cloud native space. How are they doing? You live in that space. How has Nutanix positioned themselves? >> Absolutely, I've been tracking Dheeraj and his crew for quite some time. I think they're doing a phenomenal job moving up the stack because eventually, being cloud native is critical at this point given that the majority of the new SMBs and SMEs are deploying in the cloud. So if Nutanix joins that bandwagon, it makes it relatively easy for Enterprise customers who have deployed in their own private data centers to cloud burst into Nutanix Enterprise Cloud. So over the past two days, the energy has been amazing. I presented with the Epoch crew and we got an amazing response, got to listen to customers. Their curiosity to adopting Epoch, given that they have been using Nutanix and also bursting into cloud native ecosystems as well which is why they want to understand and observe how their workloads are performing in the cloud. So very excited and looking forward to the future for the most part. >> So looking at your product, you deliver it, as I said service. You have software developers that develop that software and based on the announcements Nutanix has made in the last couple of days with Carbon and being able to develop cloud native apps, will that impact how you develop software or how you look at Nutanix as a partner for your company? >> We are growing at a very steady state and given that our core focus is security, some of our customers are on Wall Street which means that they have to ensure that they are deploying or subscribing to a service that has guarantees of its uptime and also that data is effectively protected. So we have commenced our journey as a cloud native company but that shouldn't impede us from moving into a private data center as well because our software fabric can be deployed both in a cloud native ecosystem and also on a private DC as well. So we're looking forward to working with Nutanix as a partner in the future as well if the opportunity permits. >> Yeah, so with the little time we have left, I want to get your viewpoint, talk to us about the security environment today. I'm an infrastructure guy by background and lived through, you've talked about virtualization. Been watching the containerization space, IOT greater increasing the surface area of everything. I know serverless is a whole can of worms as to how that fits in. So as we look to 2019 and going forward, what excites you and what worries you about the security space? >> What excites me is that, you know the surface is essentially getting abstracted. Back almost two decades ago, we were dealing with deploying in physical data centers on physical hosts. That transcended to VMs and then moved to Docker Unikernels and now we are speaking serverless. So in relatively, maybe in a click of a button or a single script, someone can deploy an application and that application can be scaled in a matter of minutes or seconds. So that's very exciting but what worries me is also that with the velocity and complexity, the risk is also getting amplified which means that applications are the target du jour. Applications were always the target du jour and they will continue to be as well because as engineers code even more faster, they will essentially always leave security behind. So it is important to understand the attack surface of the application because if we examine most of the recent attacks like Struts Equifax, the application was compromised and then the attacker laterally moved from host to host until they acquired or hit that asset, which is the data. So it is important to write secure software from the get-go and at the same time it is important to observe how a threat imposed by an adversarial entity correlates to a vulnerability. Which means that we have to be upfront and always observe our security from the very beginning of the software development lifecycle. So it equally excites me and worries me, which is why we decided to found ShiftLeft. >> All right, really appreciate getting to hear about ShiftLeft and your journey and what you're doing with Epoch, so thanks so much for joining us. >> Absolutely. >> And thank you for joining us. We'll be back with more coverage here from Butanix .NEXT 2018 in London, England. Thanks for watching theCUBE. >> Thank you. (up tempo electronic tones) >> Hi I'm John Walls, I've been with theCUBE for a couple of years serving as a host here on our broadcast, our flagship broadcast on SiliconANGLE TV. I like to think about the how's and the why's and the what's of technology. How does it work, why does it matter? What is it doing for end users? When I think about what theCUBE does and what it means, to me it's an off the chart benefit. The value is just immense because when theCUBE shows up, it puts a stamp of approval on your event that says man, you've arrived. I know you can't be everywhere. You'd like to be but what theCUBE--

Live from London England, it's the CUBE covering .NEXT Conference Europe 2018 brought to you by Nutanix. >> Welcome Back to the CUBE here from London. Our reporting Nutanix NEXT 2018 in Europe. Next to me is Frans Coppus. You are a manager at ICT Driessen? I'm very curious. Driessen, customer Nutanix? I understand you among other software make HRM? >> Tell me about Driessen. How does that work? How does that work? >> Yeah, uh well Driessen is a family business. We are a business service provider for the public sector in the Netherlands The Driessen Group is actually a group of companies that make work possible. We do that through the offering  of several different services. You should think of connecting people to work, so a staffing function, but next to this , we also develop software and services to take over processes for other companies or to make processes easier. >> That sounds a bit like you're on the edge. On the one hand you are a Employment Placement company, helping people get work, but on the other hand, you seem to do something with software and delivering your services as a software product. How does that work? >> Yeah, and do We indeed. That's right. We deliver services to other processes make companies easier. Think of payroll and things like that, but also all kinds of other processes and that's what  we mainly use the digital services and we develop these ourselves. For example, you should think of  a package like AFAS profit , where AFAS profit falls short in some functionality , but which customers  would like to make use of. We can we who help these customers  to provide that extra functionality to improve processes. >> Yeah, that sounds like you are software development house. you develops yes the software. >> That's right. >> How about that? Do your on-premises? If you do in the cloud? Where working with your developers? How does that work? How does that work? >> Well, we do it with a club of about 25 software developers we in private service to have. Spread across a number of different companies we have, and the software we Developing running Indeed, partly on prem and partly also in the cloud. >> Yes I understand that you do for a year or half do with Nutanix such as underlay for your infrastructure. Can you explain how how together is how the services which Nutanix products you use? What advantages do you have it? >> Well, we indeed the beginning of last year we look at our data center to actually modernize. That was the rise. When we have oriented ourselves. We already had some interest in Nutanix. Are there going deeper into deepen and finally we indeed decided to limit to Nutanix choose that. To actually the entire data center, we had slowly going to replace by Nutanix. Um, so we are there put down a piece of hardware, but then also chosen as the AHV hypervisor layer. We came from VMWare. We have it all petted or migrated to the implementation itself completely very quickly should say importing t soup boiler and was really a piece of cake and Then we started to one for our VMs to migrate to the platform. Uh, and that we have this year we found rounded. Currently running our entire data center running on actually uh uh on Nutanix indeed. Yes, because what were the problems you hoping to solve? of And, then you should think about a particular piece Scalability is not it? So for example we fine with Nutanix in any case, could reasonably small start, but if necessary, uh easy to be scales. Performance was an issue on the old surroundings. We actually have completely resolved. I think the biggest uh what we the biggest challenge we had was to make it easier. We had Yes quite a complex landscape been built up over the years. Uh and um, well that was actually the main why we express sible for Nutanix have chosen. Yes, simplification of the whole landscape. Easy to manage, especially since we thus actually have a mixed environment. Deel where I click ofthe cloud? Uh, well that's fine with Nutanix to manage, so eh. >> Yeah, exactly. I imagine when he hey you are IT manager. I can imagine your role uh too changed huh? First it was take I to really focus on infrastructure, What was difficult was that many friction. Um, what's your role in the course of changing time? >> Yeah, no, that's exactly right. That role is changing. uh in Initially at very busy to focus after the operation. To put it all in keep air. Uh sorts of things you actually yes it sounds I think you would not actually working with it wants to keep. Uhm, uhm, and we now see. We see Now just that with fewer people and a much more simple way that environment can manage. That means you some more time for free, and the time, even trying especially uh to stop uh along with the business see how we can provide our services improve? How can we availability improve? And say to equal or less cost and with less effort. >> Yeah, because I assume that you have to code word to use some digital transformation that I take for you are also an issue. Yes. You can also just wants to more to move the client. How do you do that if like, hey if IT department? How how you slide closer against the business and Driessen itself but also to the customer? How does that work with you? >> Uh well, uh, let's say, the customer needs to of course translated into the business Go to frequent the software developers. So what really us is very important is the time-to-market. Development course is very fast. We work a lot on the basis of Procurement and tendering often various demands we put than we meet to come. Yes. So, time to market is very important that, uh, that's why we uh um with Nutanix able to actually faster to deploy new features to provide direction our software developers then with them to get started. >> Yeah, yeah, because you say your software developers can thus closer So sit closer to that business. That requiring less time to UH to lay the groundwork, as it were. Um, I'm looking for, they not here .NEXT, uh we have the keynotes seen a lot announcements. Nutanix started as if modernization of infrastructure of What you had here. Meanwhile, are 15 products. It has become much more gigantic. If you people around here are looking grown. 3500 people, so therefore I am a bit like it? How do you doing that? Do you walk here too a few days around. You've seen the keynotes. You see the crowds. What is your impression of the event? >> Well I must say, very cool eh, I'm I last year in Nice, eh it was a very good conference. That was the reason I was thinking of now, I'm going this year definitely return. It was really cool to see the first keynote, how much greater it has now become, the whole event, but also the success of Nutanix. I uh, I spoke last year in Nice yet some of my peers still 't doubt was whether they would over Steps to Nutanix. Well I told him what our experiences were with it. And uh, and said, I it can definitely recommend. Also say the Using the AHV as Hypervisor. In the meantime brand just, it's so much matured. Uh uh, there's so much more added. I was really what really impressed me over the last two days have seen all new products and adulthood and the simplicity of such products. Yes. Really super cool to see, uh, what I was really stuck, I really of was impressed, was particularly Frame. Frame is uh uh uh uh really super cool. That is also something we definitely presently to look for to use it. In addition, Beam is something that very appealing. I must say, we have now uh uh uh uh all say data center on prem. So Also my DR environment we have on prem, because when we made the decision, there was no Beam. Yes, if I would again to choose, I would absolutely sure choose the DR uh using to solve beam. There too, the simplicity with which you can manage. Uh that's really cool to see. Well, we will in the future ensure that species continue to follow developments and uh I know sure that in the future to work uh continue with products such as a beam and a frame for example. >> Yeah, because what you see uh huh, they the announcement made by the core product. Heh, the core of the core products to essentials, which is a bit of the uplift heh? Those are the following small steps you can convert, yes, and then you get enterprise. Yes. There are now especially the really new projects uh Xi SaaS products de Xi Cloud and uh, and I am very curious to now is look I also know from Nutanix heh from that perspective? Infrastructure, and I have seen them grow. And watching all the announcements they done. All those products they ge done. What would really be for you the, you know, What was with you the light that went so you say yes I'll go you know when I uh home After the weekend, here I'm going to stroke. Here I would like to know more. What is the one product that you now say, I really want to get to work? >> I think if I had to choose it, then I would say, then I'm going to frame me definitely started to look at how we can put that to say uh uh uh uh our employees easier by a work to provide when they for instance remote work or things like that. >> Yes, is also one of the uh the issues which you who wants you solve by Nutanix Heh? Traditionally, did Nutanix many VDI. Still does much VDI. Is that something that uh, where you go when Driessen? >> Yeah, well at least for a part of our I'm sure a staff uh uh ways to deal deploy Frame say as a substitute for a VDI environment yes. >> Yes. Yes. Absolutely. Exactly. Yes. Exactly right. Uhm. >> And also I was really huh, and I did not think they were doing, but I understood so which uh Nutanix now we actually their own cloud is building. Yes. Yes that I am very curious what that is going to bring. Surely as say, seamlessly integrates with your back on prem omgeving. I actually find that to be the strength of this time of Nutanix heh? The that you you can switch easily between on your own prem Nutanix environment or a cloud environment. Yes. Well, if there is still a uh a Nutanix variation in the Cloud comes in, yes it is uh totally cool. Exactly. Yes. Exactly. Yes. >> Last >> though demand. You have of course developers in dienst. We have today also in the keynote various announcements seen around cloud-native as nice hot. Heh? So Karbon, databases in the Cloud with Era with Buckets, S3, S3 storage. Uh, these are also things that you think of, hey, that my developers will also get to work? Yes. Yes. mac we stand on all to knock on the door. Who want to containers to work and that kind Affairs , Uh uh uh so that's very good to hear that Also there say Nutanix fully is doing, and how it integrates within uh Nutanix, so uh, yes, there will my Software developers will be very happy with it. Yes. >> Yeah, great! but congratulations. That sounds like really a top story. A very nice story about Driessen. how you Using Nutanix. Well, I wish you success with the following to step. Thank you. Which undoubtedly UH will come. uhm. And that was it for UH for now. Thanks for look at the Cube Together with Frans herein in London uh, and until next time.

>> Live from London England, it's The Cube, covering .Next Conference Europe 2018, brought to you by Nutanix. >> Welcome back to The Cube, I'm Stu Miniman with my co-host Joep Piscaer. And you're watching The Cube, and actually Bear Grylls is going to be on the keynote shortly, but we're gonna talk a little bit more tech first. First of all I wanna welcome back to the program Chris Kaddaras is the senior vice president and general manager for EMEA with Nutanix, and welcome to the program for the first time, Sylvain Siou, senior director of Systems Engineering, also for EMEA with Nutanix. Gentlemen, thanks so much for joining us. >> Thank you for having me. >> Alright so Chris, we were thinking back, two years ago, the first European show in Vienna, I had you on the program, and you were fresh on, I always loved getting people when they're fresh into the company because they have the why they're joining in, why they think they're doing things. So, bring us up to speed. Two years, couple things have changed in Nutanix, couple things have changed in the industry, but why don't you bring us up to speed? >> Sure, no I'm happy to do that. First I'll tell you that some of the things I told you on the show two years ago actually proved true. I could see the energy in Vienna at that time in regards to what I call kind of a religious following in Nutanix because of the compelling-ness of the technology and the solution, and that hasn't stopped. One thing that I wasn't quite prepared for is just the rate of growth of this company, and how our customers really embraced us in the market. Now in the EMEA market we've had some success I would say. The team's done a really good job. When I started we had less than a thousand customers, now we have over 3,000 customers. When I started with Nutanix, in the region we had about 200 employees, now we have almost 800 employees in the region. So collectively as a region we're growing a bit faster than the rest of the world which is a good thing for us, and customers are showing their appreciation for us, so it's been a really good experience, but something like the hyper-growth that we have at Nutanix takes some getting used to when you come from other companies, but it's been a really good thing for our customers. The thing that I think I'm the most proud of is we've done that hyper-growth and we've still kept our NPS score above 90 for our customers, so our customers are getting a really good experience both from our sales teams, our product, our implementation teams, and our support teams, that it's kept everything in check for our customers which I'm really proud of. >> Well congratulations on that. Sylvain I have to think that your team has something to do with that NPS score. In my career, I have great respect for the SEs, they're the one that have to not only know the product inside and out, but they need to be working closely with the customers, have a good viewpoint on the customers. Being here at a European show, I wanna get your viewpoint. Tell us, what's different here compared to what you hear from people back at Corporate, what are some of the differences here your team sees? >> So we have a very good relationship with Corporate, so we're really aligned and we're involved in the project in same way as any other region. I think we were faster on some very big accounts, and that was really surprising and also the, I think the timing for the need of the customer to solve situation after virtualization was the exact timing when we start in EMEA, the product was mature enough so that was exactly the right timing, it's five years ago when I joined, so really we solved this first situation and after that everything we promised in term of making this platform a true cloud platform for enterprise is there, I think all these services on top of it, who have the same kind of services you can see on public cloud, is there, we show it this morning, and now giving the ability to the customer to manage situation with this cloud from different providers and what is on premise is there, so I think all the control, the costs on the compliance and so on have done a lot to manage the situation and take you through the control everyday. >> So, what is the adoption maybe compared to the US for the core products that you have now versus the additional services? Is there a big change or a big difference between the US and Europe or, what are you seeing with your customers? >> So, we follow the same path. There is some region and maybe I will relay on Chris, some region that we invest later than the others so, of course France, Germany, UK, Northern Europe was really the beginning and after that we have more southern regions or eastern region that come after, but we are surprised sometimes because people can jump to the last technology faster than the others, so I don't think there are really rules, there is really people who is painpoint, we have the solution, and when it fits, they go faster. >> Yeah I think from a solution perspective we are thriving at the same rate our emerging technologies into the market as our other regions in the world. In some cases we're ahead, things like IoT, what was originally called Sherlock, we're ahead, we have like first customer, second customer to start coming to adopt, so we do have markets within the EMEA region that are much earlier adopters compared to other regions. Think of places like the Middle East, the Nordics, France, adopting much quicker than some other regions of the world. So we see our new products starting to roll, we're really excited about Xi Leap, I know that the first instantiation went live, I think yesterday or today within the Americas, we're looking forward to going live within London, and then moving in to mainland Europe from there, and I think that will be a huge difference-maker for us in the markets as well. >> So looking at those regions specifically, I know there's a couple of markets in Europe, especially Germany, that have such strict data sovereignty laws that it makes it really difficult to actually do business from a DR or cloud perspective. How's Nutanix dealing with that? >> I think that's where we... When we have our SAS-based products, that's a challenge. When we have our cloud-based products, that's a challenge.` So, for our cloud-based products we have a plan really quickly to go into places that have data sovereignty compliance regulations that they have to adhere to. So Germany, we have a plan to go into Germany really quickly; we obviously have a plan to go into some other markets, Amsterdam, we have a plan to go into London for cloud. For SAS, a lot of customers are consuming SAS and they're okay if there's a good security problem, parameter around SAS, and they're consuming Salesforce.com without data centers, they're consuming other products that way so, as long as we put the right security parameters in place, then their consumption model around SAS is typically gonna work, I don't see us distributing SAS data centers all throughout every market in the world to do that. Our core product right now consumption is mostly local, and it's consumed either in an appliance way or it's consumed in a software way, so that's not something that we have to worry about. >> Yeah it's interesting, you wonder if North America has a greater adoption of public cloud, if that actually gets you an advantage in the EMEA region here to get deeper with some of the core and essential offerings. >> It does; customers will adopt a private cloud because of those data sovereignty regulations. But a lot of the uber-clouds have come in and solved that, they've come in into country, they've created gov clouds, they've done it in Germany, they've done it in the UK, so they're starting to solve that, but they have to put out a lot of investment to do that. But it has given us a lead in the marketplace, but there are certain markets that are very much like the US market, so the UK, it's very similar to the US market with regards to uber-cloud or public cloud adoptions so in that market we have a lot of opportunities with somebody like Beam, because they've consumed a lot of the other uber-clouds, whether it's AWS, UCP, or... And we have that opportunity to sit down and provide them with solutions. >> Sylvain, what else are you hearing from your customers, what are some of the pain points that they're feeling that your team's able to help with? >> Clearly in the past we saw the proliferation of the VM, and we find a way to control that, but with the cloud the proliferation is without any limits. So really this is something important for the customer to take back control, take control of the shuttle IT and so on, and it's very lowly. And also I want to take a specific point really the R&D are really taken care of when we see in the field, I will take just an example, the synchronus replication, metro-culturing and stuff like this to high availability, between (inaudible) and so on, it's typically European, because we have fiber, we are really city close to each other and so on, in America, that makes no sense, and really at really early stage of the company we get the R&D taking care of that, developing specifically for our market what is needed for our market, and it means that we're a really global company and not really American company, we have also R&D in different places, we have in Serbia with Frame, we have in India, and so on, so really to be really taking care of each issue or pain point of the customer is really our main driver. >> So one of those other differences I see a lot is the scale of the organization, the size. So what is an SMB in the Americas might be an enterprise in Europe. So what are the solutions you have for those types of customers, for that problem? >> So definitely we need, so we are talking to customers we have a critical science, they need to have a minimum of VM to face the issue of the bottom neck of the storage or the management part and so on, but also we have example of small customers just need a platform that works, and don't want to have anyone taking care of it. And so now it's like you phone, you don't take care of the storage and CPU, it's just your application and that's it, could be internal, external, and so on, so really the SMB of course is not the main market for us, it's more the big account and so on, but we have all kinds of customers in any verticals, there is no specific one that we cover, and it's really because the platform is something that has become just normal to be invisible. >> Yeah I would add on that, if you don't mind, I'd say that the nice thing about the product is it's in a form factor in a pricing mechanism that can be consumed from SMB all the way up to global accounts. That's the nice thing. Now, maybe we spend a lot of our field resource on mid-market up, because that's where we get larger transactions from customers, and it's just a value conversation with regards to return on investment, but the nice thing is our product can be consumed at the smallest customer. We have just released new pricing mechanisms that allow our customers to now consume at much smaller levels, so we're not allow for SMB but for ROBO, because if you think about it if you just have a one size fits all pricing structure how does that work in the data center, that same price doesn't work in the ROBO area, so you have to give the customers the ability to look at the same experience in the remote office or the small sites compared to a data center, and that's something that we've just kinda brought to the market in the last three to four months, and I think that's a real advantage of not only the product but the pricing structure. >> Chris, we wanna give you the final word. If EMEA customers, what do you want them taking away from this week? >> Sure. I think, they've already told me, and I'll tell you, which is good, 'cause it's what I want them to take away, is just the credibility that Nutanix is here for the enterprise work load, they can look at their entire data center delivery mechanism on a Nutanix platform. But also Nutanix is a company they should be looking for for their cloud-based platform. There is a decision in the marketplace to be had right now around what do you use for your cloud, lack of a better word, orchestration layout, cloud automation layout? And there's only a few choices in the market today, some of them are more open source, some of them are specific vendors, and what I want them to take way is Nutanix is an option for that, leave it up to me and my team to prove why we think we're the best option for it, but that's really what I want them to take away, the credibIlity of tier one platforms running Nutanix in their data center, and then two, Nutanix for the cloud-based platform. >> Congratulations on the progress. I wanna say some feedback I've heard from customers is despite how fast Nutanix has been growing, they still feel that they're getting the personal touch, don't feel like just a number for some fast-growing company so congrats on that, I know a lot of effort goes into that. Alright so we're at the end of the Day 1 for Joep Piscaer, I'm Stu Minimn, be sure to join us tomorrow for a full day of wall-to-wall coverage. Of course go to theCube.net for all the websites to watch us live and on demand for all the shows we're doing and once again thank you for watching the cube. (digital music)

>> Live from London, England, it's The Cube covering .NEXT conference Europe 2018. Brought to you by Nutanix. >> Welcome back to London, England. This is The Cube's coverage of Nutanix .NEXT 2018. 3,500 people gathered to listen to Sunil Potti. >> Thanks, Stu. >> For the keynote this morning, Sunil's the chief product and development officer with Nutanix. Glad we moved things around, Sunil, 'cause we know events, lots of things move, keynotes sometimes go long, but happy to have you back on the program. >> No, likewise, anytime. >> All right, so, I've been to a few of these and one of the things I hope you walk us through a little bit. So Nutanix, simplicity is always at its core. I have to say, it's taken me two or three times hearing the new, the broad portfolio, the spectrum, and then I've got the core, I've got essentials, I've got enterprise. I think it's starting to sink in for me, but it'll probably take people a little bit of time, so maybe let's start there. >> I mean, I think one of the biggest things that happened with mechanics is that we went from a few products just twelve months ago to over ten products within the span of a year. And both internally as well as externally, while the product values are obviously obvious, so it's more the consumption within our own sales teams, channel teams, as well as our customer base, needed to be codified into something that could be a journey of adoption. So we took it customer inwards, in about a journey that a customer goes through in adopting services in a world of multi-cloud, and before that, before you get to multi-cloud, you have to build a private cloud that is genuine, as we know. And before we do that, we have to re-platform your data center using HCI, so that's really if you work backwards to that, you start with core, which is your HCI platform for modernizing your data center and then you expand to a cloud platform for every workload, and then you can be in a position to actually leverage your multi-cloud services. >> Yeah, and I like that. I mean, start with the customer first, is where you have and I mean the challenge is, you know, every customer is a little bit different. You know, one of the biggest critiques of, you know, you say, okay, what is a private cloud? because they tend to be snowflakes. Every one's a little bit different and we have a little bit of trouble understanding where it is, or did it melt all over the floor. So give us a little bit of insight into that and help us through those stages, the dirty, the crawl-walk-run. >> Yeah, I think the biggest thing everyone has to understand here is that these are not discrete moving parts. Core is obviously your starting point of leveraging computer storage in a software defined way. The way that Amazon launched with EC2 and S3, right. But then, every service that you consume on top of public cloud still leverages computer storage. So in that sense, essentials is a bunch of additional services such as self-service, files, and so forth, but you still need the core to build on essential, to build a private cloud And then from there onwards, you can choose other services, but you're still leveraging the core constructs. So in that sense, I think, both architecturally as well as from a product perspective, as well as architecturally from a packaging perspective, that's why they're synergistic in the way that things have rolled out. >> Okay, so looking at that portfolio. A lot of the customers I work with now, they don't start out in a data center, they've already moved past that, right? So they are leveraging a partner, the public cloud, they might not even be running virtual machines at all anymore. How does that fit into your portfolio? >> Yeah, I mean, increasingly what we are realizing, and you know, we've done this over the last couple of years, is for example, with Calm, you can only use Calm to manage your public clouds without even managing your private cloud of Nutanix. Increasingly with every new service that we're building out, we're doing it so that people don't have to pay the strategy tax off the stack. It needs to be done by a desire of I want to do it versus I need to do it. So, with Frame, you can get going on AWS in any region in an instant or Azure. You don't need to use any Nutanix software. Same thing with Epoch, with Beam. So I think as a company, what we're essentially all about is about saying let us give you a cloud, service-like experience, maybe workload-centric. If it is desktops and so forth. Or if you are going to be at some point reaching a stage where you have to re-platform your data center to look like a public cloud, then we have the core, try and call it platform itself that'll help you get there as well. >> So, looking at re-platforming that data center. If I were to do that now for a customer I wouldn't be looking at virtual machines, storage, networking, I'd be looking at containers or serverless or you know, the new stuff. Again, what is Nutanix's answer to that? >> Yeah, I mean, I think what we've found is that there's quite a bit of an option, obviously, of cloud-native ads, but when it comes to mainstream budget allocation, it's still a relative silo in terms of mainstream enterprise consumption. So what we're finding out is that if you could leverage your well-known cloud platform to not create another silo for Kubernetes, don't create another silo for Edge or whatever the new use-cases are, but treat them as an extension of your core platform. At least from a manageability perspective and an operations perspective, then the chances of you adopting or your enterprise adopting these new technologies becomes higher. So, for example, in Calm, we have this pseudonym called Kalm with a K, right. Which essentially allows Kubernetes containers to run natively inside a Calm blueprint, but coexist with your databases inside of EM because that's how we see the next-generation enterprise apps morphing, right. Nobody's going to rewrite my whole app. They're going to maybe start with the web tier and the app tier as containers, but my database tier, my message queue tier, is going to be as VMs. So, how does Calm help you abstract the combination of containers and VMs into a common blueprint is what we believe is the first step towards what we call a hybrid app. And when you get to hybrid apps, is when you can actually then get to eventually all of your time to native cloud apps. >> You know, one of the questions I was hearing from customers is, they were looking for some clarity as to the hybrid environments. You know, the last couple of shows, there was a big presence of Google at the show and while I didn't see Google here on the show floor, I know there was an update from kind of, GCP and AHV. Is Google less strategic now, or is it just taking a while to, you know, incubate? How do you feel about that? >> So the way that you'll see us evolve as we navigate the cloud partnerships is to actually find the sweet spot of product-market fit, with respect to where the product is ready and where the market really wants that. And some of it is going to be us doing, you know, a partnership by intent first and then as we execute, we try to land it with honest products. So, where we started off with Google, as you guys know, is to actually leverage the cloud platform side, core locator with Google data centers and then what we we've evolved to is the fact that our data centers can quote-unquote integrate with their data centers to have a common management interface, a common security interface and all, but we can still run as core-located ones. Where the real integration that has taken some time for us to get to is the fact that, look, in addition to Calm, in addition to GKE kind of things, is rather than run as some kind of power sucking alien on top of some Google hardware, true integration comes with us actually innovating on a stack that lands AH3 natively inside GCP and that's where nested virtualization comes in and we have to take that crawl-walk-run approach there because we didn't want to expose it to public customers what we didn't consume internally. So what we have with the new offering that now is called Test Drive is, essentially that. We've proven that AH3 can run a nested virtualization mode on GCP natively, you can core locate with the rest of GCP services, and we use it currently in our R&D environment for running thousands of nodes for pretty much everyday testing on a daily basis, right. And so, once customer interview expose that now as an environment for our end customers to actually test-drive Nutanix as a fully compatible stack though, on purpose, so you have Prism Central, the full CDP stack and so forth, then as that gets hardened over a period of time, we expose that into production and so forth. >> So there's one category of cloud I haven't heard yet, and that's the service providers. So Nutanix used to be a really good partner for service providers, you know, enabling them to deliver services locally to local geography, stuff like that, so what's the sense of Nutanix regarding these service providers currently? >> Yeah, I think that frankly, that's probably a 2019 material change to our roadmap. It's your, the analogy that I have is that when we first launched our operating system, we fist had to do it with an opinionated stack using Supermicro. Most importantly, from an end-customer perspective, they got a single throat to choke, but also equally importantly, it kept the engineering team honest because we knew what it means to do one pick-up page for the full stack. Similarly, when we launched Xi, we needed to make sure we knew what SREs do, right. That scale, and so that's why we started with our version of SMC on, you know, as you guys know with Additional Reality as well as partners like Xterra. But very soon you're going to see is, once we have cleared that opinionated stack, software-wise we're able to leverage it, just like we went from Supermicro to Dell and Lenovo and seven other partners, you're going to see us create a Xi partner network. Which essentially allows us to federate Xi as an OS into the service providers. And that's more a 2019 plus timeframe. >> Yeah, speaking along those lines, the keynote this morning, Karbon with a k talked about Kubernetti's. Talk about that, that's the substrate for Nutanix's push toward cloud natives, so-- >> Yeah, I mean, I think you're going to hear that in the day two keynote as well, is basically, customer's want, as I said, an operating system for containers that is based on well-known APIs like Kube Cattle from Kubernetes and all that, but at the same time, it is curated to support all of the enterprise services such as volumes, storage, security policies from Flow, and you know, the operational policies of containers shouldn't be any different from Vms. So think about it as the developers still a Kubernetes-like interface, they can still port their containers from Neutanix to any other environment, but from an IT ops side, it looks like Kubernetes, containers, and VMs are co-residing as a first-class option. >> Yeah, I feel like there had been a misperception about what Kubernetes is and how it fits, you know. My take has been, it's part of the platform so there's not going to be a battle for a distribution of Kubernetes because I'm going to choose a platform and it should have Kubernetes and it should be compatible with other Kubernetes out there. >> Yeah, I mean, it's going to be like a feature of Linux. See, in that sense, there's lots of Linux distros but the core capabilities of Linux are the same, right. So in that sense, Kubernetes is going to become a feature of Linux, or the cloud operating system, so that those least-common denominator features are going to be there in every cloud OS. >> Alright, so Kubernetes not differentiating just expand the platform >> Enabling >> Enabling peace. So, tell us what is differentiating today? You know, what are the areas where Nutanix stands alone as different from some of the other platform providers of today? >> I think that, I mean obviously, whatever we do, we are trying to do it thoughtfully from the operational, you know, simplicity as a first-class citizen. Like how many new screens do we add when we use new features? A simple example of that is when we did micro-segmentation. The part was to make sure you could go from choosing ten VMs to grouping them and putting a policy as soon as possible as little friction of adopting a new product. So, we didn't have to "virtualize" the network, you didn't need to have VX LANs to actually micro-segment, just like in public cloud, right. So I think we're taking the same thing into services up the stack. A good one to talk about is Error. Which is essentially looking at databases as the next complex beast of operational complexity, besides. Especially, Oracle Rack. And it's easier to manage postcrest and so forth, but what if you could simplify not just the open source management, but also the database side of it? So I would say that Error would be a good example of a strategic value proposition or what does it mean to create a one plus one equals three value proposition to database administrators? Just like we did that for VIR vetted administrators, we're now going after DBS. >> Alright, well, Sunil thank you so much. Wish we had another hour to go through it, but give you the final word, as people leave London this year, you know, what should they be taking away when they think about Nutanix? >> I think the platform continues to evolve, but the key takeaway is that it's a platform company. Not a product company. And with that comes the burden, as well as the promise of being an iconic company for the next, hopefully, decade or so. All right, thanks a lot. >> Well, it's been a pleasure to watch the continued progress, always a pleasure to chat. >> Thank you >> All right, for you Piskar, I'm Stu Miniman, back with more coverage here from Nutanix's .NEXT 2018 in London, England. Thanks for watching the CUBE. (light electronic music)

>> Live from London, England, it's theCUBE, covering .NEXT Conference Europe 2018, brought to you by Nutanix. >> Welcome back to theCUBE at Nutanix .NEXT 2018 in London with Joep Piscaer, I'm Stu Miniman, happy to welcome you back to the program multi-time guest, Satyam Vaghani, who's the Vice President and GM of IoT and AI at Nutanix. Satyam, great to see you. >> And likewise too, thanks for having me back. >> All right, so IoT and AI are two of the fastest moving spaces in IT today. I remember, we had you on the program a little over a year ago to talk about Project Sherlock. That was where, Nutanix was starting with IoT. I remember asking you, I'm like, Nutanix and IoT, come on, I don't understand. Nutanix for the most part was like two products at that point, in where they're going. Fast forward to today, it's now called Xi IoT. That's X-I and then I-O-T, because Nutanix makes the product simple, but not necessarily the name. (chuckling) But you know, Satyam help bring us up to speed as to what your team has been working on, and what's the state of the product today? >> All right, so like you said we started way back around a year and a half ago from now, We were working on Project Sherlock. The idea was the fact that a lot of analysts were projecting that a lot of enterprise data is going to be produced at the edge. It was equally important to process it at the edge for many different reasons, autonomy, security, cost, compliance. So that was the genesis. We thought we were very well-suited to do it because this was yet another problem, where you needed to provide a very elegant system, a very well-contained system, just like what HCI is for your primary data center in an extremely remote and extremely hostile environment. So that was why we thought we should take a crack at it. Along the way of course, then our ambitions broaden to being a multi-cloud company. That fit in very well as well because IoT is never an edge only problem or a cloud only problem. Every IoT app kind of spans the edge in the cloud. This was a perfect way to showcase the multi-cloud data plane, multi-cloud control plane capability. >> I love that. It was one of my rants this year is oh, edge kills the cloud. I'm like, no, it doesn't kill the cloud. Edge actually will help increase a lot of the stuff in the cloud. It just means that it all won't be in this mystical the cloud in the central, which we know everything is being built really as it should be in architecture today. So there's a lot of nuance and understanding how some of those pieces together. I was excited to hear as you actually, if I remember right, you have a customer talking publicly about using this today. >> Ah that as well. >> So there's nothing better than hearing a real world example. So maybe help walk us through that briefly. >> That's the most fulfilling part of our edge. That's the plan for tomorrow's keynote. It's very fulfilling because when we started IoT, one of the other concerns other than the why Nutanix was why IoT? It's not a mature space. Nobody quite knows what to do about it. That was the point as we thought we had an opinion about the edge being a kind of key piece of IoT. The edge plus cloud convergence being a key piece of our data, centralized management being a key piece of IoT. Then we are able to validate it, not just with PoCs but with people who have put us in production, in very fantastic and remarkable use cases. So yeah, that was the journey. This one use case was around smart retail. But it kind of embedded all the elements that we kind of hold dear to our hearts. It's can we instantiate AI inferencing, complex AI inferencing logic at the edge? Can we instantiate control applications at the edge? Can we do interesting data management between the edge and the cloud? >> So looking at this from a technical perspective, what does this look like? So if I look at this from that technical perspective, I still see a data center, I still see the cloud, I still see data going back and forth. >> Yeah. >> What makes Xi IoT different? >> Different, so one is the focus on edge computing. So a lot of IoT solutions were either made at a time when there was kind of vertically integrated IoT application. That vendor said okay, now let me get broader. So that's one category of IoT solutions out in the market. There were some IoT kind of offers, which were cloud first, right. So there's a IoT offering in the cloud, potentially for doing consumer IoT projects, and now that offering once you expand into enterprise, we said let's go from the edge outwards. Because in an enterprise context, like I said, data processing, the amount of data, the volume is pretty overwhelming. So that's one difference, which is the richness of services that we provide at the edge. The stack is pretty deep but at the same time, pretty miniaturized to Dheeraj's point from the keynote in the morning. It's these environments need to run in pretty compact form factors in terms of computing. So that's one difference. The other difference is the pipeline all the way to the cloud, we don't consider this as an edge only problem. To that end, we not only do a pipeline to the cloud but we allow the customers to have a choice of cloud. So we don't dictate the choice of cloud just because we are providing a solution to the edge. Another key difference is the ease of use both for deployment and operations of the edge device itself. So think about deploying this thing on a thousand stores. We made it zero touch provisioning process. So the only requirement to deploy the Xi edge is that you plug in the internet cable. That is very core to the Nutanix philosophy right, simplicity, one-click simplicity. The last thing is APIs. It's the programmer APIs that whole system exposes. It's Apache class APIs, open source class APIs. So that people who are already used to various programming frameworks can immediately jump on this. >> Yeah, I mean you bring up one of what we saw as, in our research, one of the biggest hurdles for this. Say go back to when we first look at industrial internet, we actually did some research with GE. It's the OT really doesn't play with IT. You've got very specific gear and it plays certain ways, and it doesn't talk, and it doesn't have APIs, and doesn't have networking. It's all going to have centers and connectivity and things like that. These worlds just don't talk today. >> They don't, yeah. >> So is it, it sounds like this is a more IT friendly solution. How do you hope to bridge that gap? >> That's a great observation. So first of all, I would say indeed, we are coming IT inwards right, IT outwards into OT. But at the same time, the only way to make OT appreciate such a solution is to show them a path that look you can adopt Xi IoT without causing disruption to your machine critical setup, OT setup that you already have. So we put in a lot of thoughts around how we can source data from OT systems without having a conversation about throwing out, ripping and replacing every OT data gathering point and device that they have. So that was one thing. The other part is if you're going provide them some extra added benefit, if that OT person wants to do some of that infrastructure on top of this kind of IT-OT converged system. So to that end, we think there are some specific security benefits, some resource management benefits, some user management benefits that we can provide in this new edge that the OT guys would appreciate as well. So it was about having something for the OT guys to appreciate so that there is some buy-in, as opposed to dictating that you got to do it. >> So one of the things I observe in that industrial world is there's quite a lot of developers in that space as well. They are actively developing while gathering data, while figuring out IoT. So how do you let them, let those developers work on that platform as well? For instance, do you use Carbon on that platform? Stuff like that. >> All right, so we have a bunch of services on the platform. Essentially, it's like a PaaS but for the edge. So there is container services functions, there's some data services, AI services. But the developer point is very interesting. So in fact, as we speak, we are going through that journey as a company. Right, how can we be a more developer centric company. It involves literally running a Seven-R Xi IoT lab yesterday. A lot of people showed up, and they stayed throughout the day. So I think it's awareness thing. It looks like, at least from an interest point of view, once people see the platform, the APIs, there is true interest. So now, it is up to Nutanix to have enough events to have enough kind of awareness campaigns to make sure that this word spreads out. Unfortunately, I don't have a silver bullet for this but it's literally going to be a work in progress. Next year same time, maybe when we talk, probably we should talk about whether we made progress on this or not. >> Speaking of areas that don't have silver bullets. You mentioned security. A lot of concern around, there's already been breaches and hacks, and things like that. Security as we know, it just, the surface area goes up, in order of magnitude or more. How does Nutanix look at the security aspect? >> All right, so there's various things. But I'll give you one example, concrete example of what we did that is making a dramatic change, right, moving the needle so to speak. You can always argue that your platform is secure, but at the end of it, how do you prove it? So one proof point we have is from a security point of view, the Xi IoT edge is locked down. Even administrator cannot login. So the idea was that if you ever let the administrator have a user name and password to an edge device, that is bound to be a point of compromise, no matter how secure you are. So the only way to eliminate that is to just eliminate the need to have a user name and password to an edge device. So those are some of the things that we kind of thought and that's actually tightly ingrained in how the system is designed. 'Cause you can't test the edge. You can deploy all the applications you want but you can't touch it. You can't touch the, we provide containers as a service to the edge but you don't configure containerized solution on the edge. The system does it for you. So these are some of the things, the more automation we do, the more we remove humans from some of these very machine, security critical points, the better off we are in terms of reduced chances of hacks. >> Okay, so you've got a customer up on stage tomorrow. Is Xi IoT, is that now GA today? >> Oh right, sorry, I forgot to mention, it is indeed it's GA. >> Okay. >> And the press release went out today. >> Okay, give us what should we looking going forward? We understand, we're still as an industry early on this journey. Your teams have been working on it for a while but what should we be looking for? What is some of the key things down the road that you're excited for? >> From Nutanix or industry? >> Well, I'll take both. >> Okay (chuckling). Give me two hours, well anyway, let's see. First from Nutanix, so you know, we want to, IoT is not a single vendor problem right. So as much as we want, we want to make this a platform that is attractive to OT folks that is attractive to IoT vendors who have been creating this very vertical specific IoT apps. You want to prove to them that this is a way better platform for them to deploy their apps at industry scale. We want to, we want to appeal to AI guys, data scientists who are going to create interesting applications around data processing. So some of the next few steps is to provide interesting features and functions in the system, which appeal to all these demographics. From a GTM point of view, go to market point of view, we want to make sure that we get some partnerships right. 'Cause again, this is not just a technology problem. So those are some of the steps you're going to see. You are probably going to see more we are open to bring your own cloud philosophy for our IoT platform. Out of the box, we support Azure, AWS, Google, and private cloud if you bring that in. Maybe we'll expand that portfolio because there are other cloud providers especially if you are looking at regional markets like APAC, and EMEA, and so on. So that's some of the thing. Then last but not the least, you are going to see more and more investment in AI. Because, there's obviously a lot of talk about AI, and it's very easy to do a proof of concept, oh well, kind of easy. But it's very difficult to deploy that proof of concept at the industrial scale. That is a problem we want to really really solve very well. So you'll see a whole bunch of investments, features, announcements around it. >> All right, so I think we're going to have to leave it there, Satyam. >> All right. >> Pleasure is always to catch up with you. Congrats on the progress, and look forward to hearing from your customer on stage. >> Thanks very much, Stu, thanks Joep. >> All right, thanks so much. For you, Piscaer, I'm Stu Miniman. Be back with more coverage here from Nutanix .NEXT 2018 in London England. You're watching theCUBE. (enlightening music) Hi, I'm Stu Miniman. I've been analyst with Wikibon, and a co-host with theCUBE since 2010. Before that, I've worked in the tech industry for many years in a number of different companies. My background really is in networking, virtualization, cloud computing since the early days. I really love the intersections of some of the technology.

>> Live from London, England, it's theCUBE. Covering .NEXT Conference Europe, 2018. Brought to you by Nutanix. >> Welcome back, I'm Stu Miniman, my cohost Joep Piscaer, and you're watching theCUBE here at Nutanix .NEXT, London, 2018. Happy to welcome back to the program the co-founder, CEO, and chairman of Nutanix, Dheeraj Pandey. Dheeraj, thanks so much. Congratulations on 3500 people here at the third annual European show, and thanks so much for having theCUBE. >> Thank you, my pleasure. >> All right. So, Dheeraj, first of all, you got a lot going on. Big company event here, last night you announced the Q1 2019 earnings. I guess, step back for a second. Nutanix is now, nine years since the founding, you've been public now for a little while, you got to be feeling good. The company's reached a certain size, very respected in the marketplace. So how are you and the team feeling? >> Yeah, well, I tell people that it's actually fun to be a public company. And obviously there is a cost to being a public company, because you're on a quarterly treadmill, in some sense. But Wall Street also keeps you honest. Just like Main Street keeps you honest on quality of product and customer service, Wall Street keeps you honest on spend and what does it really mean to grow at scale. So I like the fact that there is two good streets that are keeping the company honest. And it's really fun to think about capital allocation, one of the big things as you grow. I mean, you're going to spend more than a billion dollars this year alone. How do you allocate capital wisely is something that I think a lot about in (mumbles). >> Yeah. So, at this show, you kind of change some of the positioning of the portfolio. It's the Core, Essentials, and Enterprise, and right, that asset allocation, when I look at Essential, Xi Cloud, there's all these different pieces, some of them through acquisition, some of them created internally. You need to be careful that you don't over-commit, but when do you decide to kill stuff or keep it going, so you got a lot of plates to spin now, a lot more than you did a year or two ago. >> Yeah, absolutely, and it's not just product development. It's also marketing and sales and G&A. I mean, there's other departments we need to think hard about. Like, how do you create brand awareness for these new things? How do you do demand generation? How do you have a specialty sales force? All those things have to be considered, so, nine years, it's been a journey, but it still looks like it's nothing. And we're still a very small company, and we need to think hard about the next five years, in some sense. >> Yeah. So, one of the metrics you gave Wall Street to be able to look at is, what percentage of customers are using more than just the Core? So the Essentials or the Enterprise. And if I got it right, it's up to 19% from 15%, the quarter before. I wonder, is the packaging, how much of that is for Wall Street? Somebody cynically might look and be like, hey, is the Core market slowing down? And therefore you need to expand. We've all seen public companies that need to go into adjacencies, and shouldn't you stick to your knitting? You've got a great solid product with leadership in the marketplace. >> Yep, absolutely. Also, look, we are not bundling them in SKUs so we cannot force customers to actually buy them. We're not doing financial engineering of dollars, because these not SKUs or bundles. This is a journey which is mostly advisory, in some sense. This is how you should start, this is how you should go, and this is advisory for our sellers and our buyers and our channel people. Everybody needs to say, look, have the customer go through the journey. If you had to do what he just said, probably would've bundled them in SKUs and then allocated capital to one or the other. I think, to your other comment about just sticking to the core, Juniper stuck to the core. And many companies out there which just stayed as a single-box company, they stayed at the core. And eventually you realize the market has moved faster than your core itself. So there's this business school thinking, they call it the Icarus Effect. The Icarus Effect is all about, I'm so good at what I do that I can fly to the sun and nothing will happen. But you don't realize that Icarus, the wings were actually pasted using wax. And you go to the sun, and the sun actually melts the wax. So companies like FGI and SUN, Norca, many companies just stuck to one thing. And they couldn't evolve, actually. >> Obviously you're not sticking to the core alone, right? You're expanding the portfolio, I mean, you're not just an infrastructure company anymore. You do so much on top of the infrastructure on-prem. You have so many SAP services, so how do you manage the portfolio in terms of the customer journey? Because there's so much to tell to a customer. How do you sell it? How do you convince a customer to go from Core to Essentials to Enterprise? >> The most important thing is leverage. Is Essentials going to leverage Core, and is the Enterprise going to leverage Essentials and Core itself? Case in point, Files is completely built on top of Core. So every time somebody's using Files, they're also using Core. If you think about Flow, it uses AHV underneath. Frame, and case in point. When it's going to deliver desktops, it's going to use Files because every desktop needs a filer as well. And then when Frame delivers desktops on-prem, it's going to use all the Core. So the important thing is how they don't become disparate things, like they're all going in their own direction, is there a level of progressiveness where you say, well, if you're using the Enterprise features, a lot of them actually go in and drag in the Core as well as Essentials. So how do we build that progressive experience for the customer, where each of these layers are actually being utilized, is the important piece. >> Dheeraj, so, we're talking a lot about the expansion beyond the Core. But there was a pretty significant activity that your team did on Core itself. So the first time I heard about it, it basically said, we're doing an entire file system rewrite. Think of it almost as AoS 2.0. Now, from a product name, I believe it's 5.10, so I might have trouble remembering which release it was, but talk about what went involved in that. Obviously a lot has changed in the nine years since you created it, so. >> Absolutely. Yeah, yesterday in the earnings call I talked about it too, that people scoff at Core infrastructure. Like, oh, it's going to be a commodity because it's good enough infrastructure. But then I argue that there's no such thing as good enough infrastructure. And companies struggle when they don't focus on infrastructure itself. It's like food, shelter, clothing in the Maslow's hierarchy of needs. If you don't get that, then there's no point self-actualizing it. So, Core infrastructure completely destroys network insecurity. You got to get it right. I mean, look at Oracle, how it's struggling with IaaS. And look at Google, they're trying to figure out how to make it relevant for the Enterprise. Azure has like three or four different stacks for infrastructure. One for old 265, one for Azure DB, one for Azure, and now they're rewriting it for Azure itself. VMware has three different infrastructure stacks. One for three tier, where they are very happily, they're saying, look, let EMC, their NetApps actually are underneath, and Cisco's, and stuff like that. And then they have this software-defined infrastructure with commodity servers. And finally, they have VMware-enabled AWS which is going to use AWS services. So now you have three different forks of your core base, in some sense. And for us, what's important is how we use a single core base for everything. So architecture matters. I was arguing yesterday in the earnings call that good enough infrastructure is an oxymoron. You need to get core right before you can go and try to live the other layers of the Maslow's hierarchy of needs, actually. And that's why we went back and thought about, as the workloads were growing and increasing, and we had mission-critical stuff in memory databases, what do we need to really do about the way we lay out the data and lay out the metadata? So as you know, metadata is at the core of anything in systems, and especially storage systems. And the metadata of our erstwhile system was actually very completely distributed. And then we realized that some things can be local, and some things can be distributed, and that's better scale. Again, going back to this understanding of what things can be represented locally for a certain disk versus what things need to be global so that you can go and say, okay, where is this data really located? What drive? But once you go to the drive, you can actually get more metadata. So, again, you're getting more progressive scanning. So at the end of the day, our engineers are constantly thinking about performance and scalability, and how do you change the wings of the plane at 35,000 feet? It's a very big challenge. >> So that's one of the issues, right? So you're still focusing on your own infrastructure layer, right? But many customers do already have presence in a different hardware stack, or the public cloud, or some service provider. So not everything runs on your platform. So how are you planning to deliver the services ensemble to customers that don't necessarily run on AoS? >> So that's the multi-cloud journey, which is basically the enterprise journey of our customers. I said this yesterday in the earnings call as well, that all our services should be available both on-prem and off-prem. This idea of a VPC, that is multi-location, is what hybrid cloud is all about. So how do you get a virtual private cloud to really span multiple clouds in multiple locations? I think you saw from the demos today of how you're really running all of AoS on top of GCP virtual infrastructure. And in the course of the coming year or two, you'll see us do the same thing, BEM at Amazon, BEM at Azure. Because they deliver servers in their data centers and that's leverage for them because they've already gone and spent so much money on data centers that it's easy for them to deliver a physical server that our software can run on top of. And if people are not using AoS, they'll still want to use things like Frame and Beam and COM and other such things like that. >> Yep, Dheeraj, what are you hearing from customers and how do you think of hybrid, as it were? You know, a lot of attention gets played to things like Azure Stack from Microsoft from VMware on AWS, I know you've got some view points on this. >> Yeah, no, in fact, so if you go back five years, hyperconvergence had become a buzz word maybe three, four years ago. And there were a lot of companies doing hyperconvergence. And only one or two have survived and it's us and VMware, basically have survived that. Everybody else has a checkbox because the customers said well, what about that? Will we have a check box? But, it's really about operating system sort of hyperconvergence. And it has to be honest. And it has to really blur the lines between compute and storage and networking and security. I think hybrid needs to be honest and one of the killer things that hybrid needs is blurring the lines between networks, blurring the lines on storage so you can do one click replication and one click fail over. So a lot of those things have required a lot of innovations from us. That's why we were delayed in Xi. We didn't want to just put up data centers and just like that. I mean, if you go back in time to many hardware companies were putting open stack data centers and calling it their new cloud in response to Amazon. And VMware tried vCloud Air. And they had a charter to go spend money. They weren't going to spend a ton of money on hardware. Without even knowing that the cloud is not about data centers. Cloud is about an experience. It's about eCommerce and computing coming together. And you have to be passionate about a catalog. You know, the marketplace, the catalog so that people can really go and consume things from a catalog. I think that's what our experience has been that. Look, if you don't think of it like a retail giant or retail customer, which is what Amazon has done such a good job of. You know, they've thought about computing as an eCommerce problem as opposed to as a compute storage networking problem itself. And those are the lessons that we have learned about hybrid just as much >> Alright, you did a nice job on the keynote, laying out that Nutanix, like your customers, you're going through a journey. The crawl-walk-run, if you will. We got a tease in the keynote this morning about something cloud native. Where you're going. Final question for you is as you look at the company, you said it's still young, where are your customers going, where are some of the things they need to work on, and that Nutanix will mature with them as we look to move forward? >> Well, I mean, look. I think everybody knows where customers are headed. They're questioning who fulfills the promise because the requirements are all the same. They all want to go and use next generation infrastructure, they want to modernize their data centers, the infrastructure. They want to use some things that they want to own, some things they want to rent. The question is, where is the best experience possible? And by that, I mean not just systems experience of hybrid clouds but also customer service and having an ever-growing catalog and being able to deliver things for developers and devops. And technology will come and go. Two, three years ago, the Puppet and Chef were the hottest thing on, now today, it's Kubernetes. Tomorrow, it's going to be something else. It's the fact that what you see is what you do. And what you do is what you say. In our business, it's about integrity. I was arguing about this yesterday in the earnings call, as well, that building business software is a little bit easier. I shouldn't trivialize it as much but if people use business software, they can work around weaknesses of business software. But if you are in the business of infrastructure, applications cannot work around weaknesses of infrastructure. So integrity matters a lot in our space, actually, and that is about great products, great customer service, fast innovation, recovering fast, being resilient. Those are the things that we focus a lot on. >> Alright, well, Dheeraj, thanks again, always. We didn't even get to talk about the width part, the fourth H that you've been talking about for the honest, humble, and hungry. So, thank you. Congratulations to the team and always appreciate you having on our program. >> My pleasure. >> Alright, for Joep Piscaer, I'm Stu Miniman. Stay with us. Two days live of wall to wall coverage. Thanks for watching theCUBE. (light music) >> I have been in the software and technology industry for over 12 years now. And so I've had the opportunity as a marketer.

>> Live from Las Vegas, it's theCUBE covering VMworld 2018. Brought to you by VMware and its ecosystem partners. >> Welcome back to theCUBE's coverage of VMworld 2018. Two sets, wall-to-wall coverage. We had Michael Dell on this morning. We had Pat Gelsinger on this afternoon. And happy to welcome to the program, first time guest, Keith Moran, who's the vice president with Nutanix. Keith, I've talked to you lots about theCUBE, you've watched theCUBE, first time on theCUBE. Thanks so much for joining us. Yeah, thanks for having me. It's a great show. >> Alright, so let's set the stage here. We're here in Vegas. It's my ninth year doing VMworld. How many of these have you done? >> So this is my fourth. >> Yeah? How's the energy of the show? The expo hall's hopping. You guys have a nice booth. What are you hearing from the customers here? >> I think that we're seeing just a lot of discussion around where the market's going with hybrid cloud. I think that it's a massive opportunity. I think people are trying to connect the dots on where it's going in the next five years. The vibe's extremely strong right now. >> I've met you at some of the Nutanix shows in the past and seen you at some of these, but tell us a little bit about your role, how long you've been there, where you came from before. >> I run the Central US for Nutanix, and I spent a long time in the converged, whether it was that app at EMC, through a few start-ups, and then I've been at Nutanix for four years. It's been a great ride, seeing how the market's adopting to hyperconverged. The core problem and vision that Dheeraj saw nine years ago is playing out. He's five chess moves ahead of everyone. I think there's, again, a massive opportunity as we move forward. >> Keith, I love your to share. I love people in the field. You're talking to customers every day. You hear their mindset. I think back over the last 15 years in my career, and when Blade Server first came out, or when we started building converged solutions. It was like, "Oh, wait." Getting the organization together, sorting out the budgets. There were so many hurdles because this was the way we did things, and this is the way we're organized, and this is the way the budgets go. I think we've worked through a number of those, but I'd love to hear from you where we are with most customers, how many of them are on board, and doing more things, modernizing, and making changes, and being more flexible. >> Yeah, so I think you're spot on in the sense that the silos was the enemy in the sense that people were doing business as usual and that there was process, and they didn't want to take risks. But I think that the wave of disruption has been so strong and that we're in this period of mass extinction where customers, They don't have a choice anymore. That they have to protect against the competitive threat or exploit opportunity, and I think that the speed and the agility with hyperconverged is, And what the market disruption is forcing them to make those changes and forcing them to innovate. At the end of the day, that's their core revenue stream is how they experiment, how they innovate. Again, you're seeing the disruptions coming so fast that people are changing to survive. >> Yeah, we have some interesting paradoxes in the industry. We're talking about things like hyperconverged, yet really what we're trying to do is build distributed architectures. >> Correct. >> We're talking about, "Oh, well I want simplicity, and I want to get rid of the silos, but now I've got multicloud environment where I've got lots of different SaaS pieces, I've got multiple public clouds, I often have multiple vendors in my public cloud, and I've like recreated silos and certifications and expertise." How do customers deal with that? How do you help, and your team help to educate and get them up so that hopefully the new modern era is a little bit better than what they were dealing with? >> Yeah, and I think that's part of where the opportunity is. I think that the private cloud people don't do public well, and I don't think that the public cloud vendors do private well. So that's why the opportunity's so big. And I think for us, we're going to continue to harden the IaaS stack of what we built, and then our vision is how do we build a control plane for the next generation. If you look at our acquisition strategy, and where we're putting in it, how do you have a single operating system that spans the user experience from the public to private, making an exact replica. Again, I think customers are struggling with this problem and that as apps scale up, and scale down, and the demand for them, that they want this ability to course correct and be able to move VMs and containers in a very seamless fashion from one app to the next and adjust for the business market conditions. >> Yeah, I had a comment actually by one of my guests this week. We now have pervasive multicloud. We spent a few years sorting out who are the public clouds going to be. And there's still moves and changes, but we know there's a handful of the real big guys, then there's the next tier of all of the server providers, and the software players, like Nutanix. Look, you're not trying to become a competitor at Amazon or Google. You're partners. I see Nutanix at those shows. So maybe explain what's the long-term strategy. How does Nutanix, as you've been talking about enterprise cloud for a number of years, but what's that long-term vision as to how Nutanix plays in this ecosystem? >> Yeah. So for us I think part of it is our own cloud, which is Xi, and it's living in this multicloud world where our customer can do DRs of service with that single operating system, moving it from a Nutanix on-prem solution, moving it to a Nutanix cloud, moving it to Azure, moving it up to TCP, or moving it to AWS. And they have to do with it with thought because clearly there are so many interdependencies with these apps. There's governance, there's laws of the land, there's physics. There's so many things that are going to make this a complex equation for customers. But again, they're demanding, and that's forcing the issue where customers have to make these decisions. >> Keith, I want to hear, when you talk to your customers, where are they with their cloud strategy? I heard a one conference, 85% of customers have a cloud strategy, and I kind of put tongue in cheek. I said, "Well 15% of the people got to figure something out, and the other 85, when you talk to them next quarter, the strategy probably has changed quite a bit." Because things are changing fast, and you need to be agile and be able to change and adjust with what's going on. So where do your customers, I'm sure it's a big spectrum but? >> It is. The interesting thing for me for cloud is on average, we're seeing that the utilization rate, specifically in AWS, is somewhere in the 25% rate for reserved entrance, which was very surprising to me because the whole point of cloud is to test it, to deploy it, and to scale up, and if you're running in an environment where the utilization rate that the economics aren't working. So I think that people are starting to look at, alright, what are the economics behind the app? Does it make sense in the cloud? Does it make sense on-prem? Again, what are the interdependencies of it? The classic problems they're having are still around. They're spending 80% of their time just managing firmware and drivers and spending thousands of hours per quarter just troubleshooting and not impacting the business. So I think, fundamentally, that's what the customers are trying to solve is how do we get out of this business of spending all our time keeping the lights on and how do we drive innovation. And that ratio has been historically for 20 years. And I think, again, Nutanix helps drive that in the sense that we're helping customers shift that ratio and that pain. I always say, "Put your smartest people on your hardest problems," and when you've got these high-end SAN administrators spending a lot of time, they should be working on automation, orchestration, repeatable process that gives scale and again, impacts the business. >> Yeah. A line that I used at your most recent Nutanix show is talking to customers. Step one was modernize the platform, and step two, they could modernize the application. >> Absolutely. >> Speak a little bit to that because in this environment, we know the journey we went through to virtualize a lot of applications. I talked to a Nutanix customer this morning and talked about deploying Oracle, and I said, "Tell me how that was," because how many years did we spend fighting as customers? "You want to virtualize Oracle?" And Oracle would be like, "No, no, no. You have to use OVM. You have to use Oracle this. You have to use Oracle that." We've gone through that. And is it certified on Nutanix? It's good to go. It's ready to go. He's like, "It was pretty easy." And I'm like, it's so refreshing to see that. But when you talk about new modern applications and customers have this whole journey to embrace things like Agile, LMC ICD, and the like. Where does Nutanix play in this, and how are you helping? >> Yeah, so I think on the first. When you look at the classic database, so things like Sequel were automating so that you can extract it in a very simple manner. You look at the mode 2 apps like Kubernetes, we're taking a 37 page deployment guide and automating it down into three clicks because customers want the speed, they want the deployment cycles, they want the automation associated with that. And it's having a big impact in the sense that these customers are trying to figure out, "Where am I going here in the next three years?" For us, we're seeing massive workloads, whether it's Oracle, Sequel, people deploying on it. And again, there's so much pressure for people to change and constantly disrupt themselves, and that's what we're seeing. And layer that all on top of a lot of legacy apps. So we've got oil and gas customers, and big retailers, and when they show us the dependency maps of their applications, it's incredible. How complex these are, and they want simplicity and speed, and how do they get out of that business of the tangled mess. >> Yeah. Keith, I wonder if you have an example, and you might not be able to use an exact customer, but you mentioned some industries, so here's something I hear at a show like this. Alright, I understand my virtualized environment. I've deployed HCI. I really need to start extending and using public cloud. What are some first steps that you've seen customers as to how they're making that successful? What are some of those important patterns, what works, and where's good places for them to start? >> I look at it almost, when I see some of the automation deployment cycles they have of how they get a VM through the full lifecycle, and behind the scenes they have such massive complexities that it's hindering their ability to create automations. So the first layer is how do you simplify the infrastructure underneath, and it goes back to that dependency map. So again, oil and gas, that's big retailers. When they show us what their infrastructure is, they want to simplify that layer first, and then from there they can build incredible automation that gives them a multiple in the return that is much greater than what they're seeing in today's infrastructure. >> Keith, what's exciting you in the marketplace today? You get to meet with a lot of customers. Just kind of an open-ended. >> So for me, it's I've worked in a lot of big legacy companies, and I've never seen customers that have the passion towards Nutanix. And I think that it's the problems that we're solving for them, the impacts we're having on the business is driving that loyal following. But again, how fast people are either trying to exploit a competitive advantage or protect against a threat, that it's interesting to be right in this, in the epicenter of this big shift that's happening, right? Tectonic plates are shifting in that you've got a massive cloud provider like AWS. You've got a big player like VMware. What's the next generation going to look like? For me it's fascinating to see how these businesses are competing. I look at a customer. I've got a Fortune 500, The CTO's comment to me was, "I'm one app away from disruption." So they're a massive commercial real estate organization, and he's terrified of what could happen next, and he's got to stay way ahead of the curve, and I think that the innovation rate that we're bringing, the support, the infrastructure. I think it's a great place because of how we're serving what we call the underserved customer and having a big impact. >> Yeah. It's interesting. We always poke at the how much are customers just dreading that potential disruption and how much are they excited about what they can do different. You talk about working with traditional vendors in IT for the last decade or so, it's like IT and the business were kind of fighting over it. There's a line one of our hosts here, Alan Cohen, used to use. Actually, the first time I heard it was at the Nutanix show in Miami when we had it on. And he said there's this triangle, and where you want to get people is away from the no and the slow, and get them to go. Do you feel more people are fearful, or more people are excited. Is it a mix of-- >> It is. >> Those for your customers? >> And again, I think that the marketforce is really helping because people there they have to shift to stay competitive, and they're pushing every day to the level of change and how people are embracing change is much faster than it was. Because again, these disruption cycles are much faster and they're coming at customers in a totally different way that they weren't prepared for. >> Alright, Keith, final word from you is how many of theCUBE interviews have you watched in the last bunch of years? >> The content, I mean, it's off the charts. Hundreds and hundreds of hours, I would say. >> Well, hey. Really appreciate you joining us. Keith Moran, not only a long-time watcher, but now a CUBE alumni with the thousands that we've done. So pleasure to talk with ya on-camera, as well as always off-camera. >> Yeah, great stuff, Stu. >> We'll be back with lots more coverage here from VMworld 2018. I'm Stu Miniman, and thanks for watching theCUBE. (upbeat music)