(upbeat music) >> In our recent predictions post, we said 2022 would see a complete reset of how organizations think about remote work. Data from ETR shows that we exited 2021 with 45% of workers still remote, and 29% working in a hybrid mode, with only 26% fully back in the office. The expectation, however, is that hybrid will become the dominant work model in 2022 and beyond, with only about a third of employees returning to the office permanently. As such, we've said that the capabilities to support this new model must evolve and deliver a highly secure, scalable, and never-can-go-down infrastructure. Hello, I'm Dave Vellante, and we're here with Raakhee Mistry, who is the director of product marketing at Cisco on the enterprise, networking, and cloud team. Welcome to theCUBE, Raakhee. >> Thanks for having me, Dave, very excited to talk about hybrid work with you today. >> Great now, so Cisco, you've got a strong point of view on hybrid work and some big news to really lean into and support customers in this transition. Raakhee, could you share a little bit about what we can expect from Cisco in this key area? >> Absolutely, we are thrilled to be diving into the details of our new networking innovation with theCUBE on February 15. Our top Wi-Fi, 5G, and switching experts will be joining you Dave, and they'll be discussing these important topics and how to transform the hybrid world. All of our customers are exploring how to architect more hybrid work, and this is a great opportunity for them to learn how they can prepare their infrastructure for great experiences from anywhere to support smart and sustainable workplaces and deliver secure IoT at scale. Included in this announcement, are new Wi-Fi 6 solutions powered by our industry leading (indistinct) and Meraki access points. In addition, we're going to compliment this technology with our enterprise Wi-Fi stack, with our new private 5G service that's provided by our service provider partners, to deliver more choice of mobile connectivity to our enterprise customers. And of course, we need to deliver a robust backbone, that's ready for all this wireless and IoT demand that's coming (murmurs) today and into tomorrow. And we will reveal the catalyst 9,000 acts, an extension of our flagship switching line. That will be now powered with Silicon one technology. After theCUBE interview that we have with you all on February 15, we will host our own customer virtual event on February 23rd and go even deeper into this technology, with demos, customer stories, and also new industry experts that will provide great advice on how to lead hybrid work and drive this transformation in your organization. This all aligns to Cisco's strategy to help our customers connect, secure, and automate in this new world and deliver an inclusive future for all. >> Okay, wow, thank you Raakhee. A lot to unpack there. And for sure every organization is trying to get hybrid work, right? So mark your calendars February 15th at 9:00 AM Pacific for theCUBE's preview of the network, powering hybrid work made possible by Cisco. We'll see you there. (upbeat music)

>>Ply from Barcelona, Spain. It's the cube covering Cisco live 20 fly from Barcelona, Spain. It's the cube covering Cisco live 2020 brought to you by Cisco and its ecosystem partners >>come back to the live coverage of Q four days here in Barcelona, Spain. I'm John for a stupid cube coverage at Cisco live 2020 in Europe. Our next guest, Michael Beasley CTO of the Cisco service provider business unit. Michael, great to see you. Thanks for coming on. Thank you for having me. It's great to see you guys again. You came on at the Cisco live show last year, 2019 in the U S obviously as a CTO of the service provider group, you're in the middle of all these really big conversations because the service providers, I've been really trying to push the envelope for generations into getting better performance, but the diversity of services that they have to start bolting onto their infrastructure. Now with all the pressure of the cloud providers, everybody's streaming these days, so all these new competition, so service parts still have a huge footprint, huge infrastructure. >>That's the story. What's going on with a service provider. They obviously do, I mean more and more service providers are deploying and running critical infrastructure for their consumer customers, their enterprise customers, and obviously as as the economy, as nations, as industries continued to digitize, that infrastructure's critical for governments, for countries and for whole economic environments. And the reality of course is that the bandwidth keeps growing more and more bandwidth is coming onto the network. We see tremendous innovation and advancements in the access layers, whether it be on the DOCSIS for cable, wifi, six obviously for wifi and for five G with regard to mobility. So the amount of bandwidth that can come on to the network keeps rising, rising exponentially. So the service providers, you know, obviously that poses a set of challenges, but also a set of opportunities as they rethink their architectures and their infrastructure to be able to deliver that bandwidth cost-effectively. >>I know cost is a huge concern for these guys because they do spend a lot of money. Stu and I were just reminiscing about how much we've been following Cisco growing up in the computer industry at our rate and we're there when Cisco was born and watch it progress over the years and now as it's on the next generation or the next gen cloud, next gen, everything. It's interesting you have the service providers say, but the one that you're in, and I would say maybe financial services have always been like the hardcore Cisco customer pushing the envelope on the gear, pushing the envelope on the technology because they have low latency requirements. You move and pack us around. Right now you're starting to add more payload with more bandwidth coming. It really kind of the fit of the bellwether. What are the big trends that they're driving now because again, they have to maintain those table stakes and still pioneer new ground. >>What are some of the things that they're doing that you see or tell signs for the future? >> I think the things that I see is first of all, a drive towards rearchitecting the network such that it's much more simple, easier to operate, more cost effective and more reliable to operate with w with new next generation technology up and down the SAC, the stack from the Silicon through the actual systems, the embedded software, the optical modules, all of the physical ingredients that go into building a next generation software defined transport network. That's really what I see our major customers aim towards. Obviously it takes time. There's an amount of challenges given that some of these customers have been running networks for century. That said the desire and the efforts to partner with us to get to that future state such that the bandwidth can be offered cost-effectively and very reliably as we're building out this, these critical infrastructures. >>I would add. The other aspect is that as these networks are getting more powerful delivering more services, there is more of a consideration for the integrity, the trustworthiness and the security of the actual networks and the actual infrastructure from the hardware through the software in Silicon that actually make the make up these networks in having technologies that can measure the trustworthiness and the fidelity both from a hardware but also from a software perspective and be able to report off of the infrastructure without the station records to verify and to drive analytics with regard to the cleanliness and the trustworthiness of this infrastructure. >>Yeah. Michael, I remember leading up to the announcement that this is gladness. December, it was, Oh here's the next gender issues generation in the internet and in my mind I was like, Oh, sounds like it's time for the next generation of routers. But what I found really interesting is, you know, what are those next generation applications that are going to drive things? You know John talks about from a history lesson, I remember going back, you know, okay, what's going to drive 10 gig? Oh, we're going from a lot of North South to the East. West virtualization wave was really kicking off inside data centers these days. You know, it's multicloud, it's cloud native application 5g of course as a drum beat in the background. Talked a little bit about some of those applications, the business impact that the surface fighters need to be able to enable in this rollout of this new technology. >>Yeah, it's a very interesting area. I've been in the industry for 30 something years, just about 30 years and I think I've never found the industry more exciting than it is today. Obviously there's that set of challenges, but there's an incredible set of opportunities as well. We have all of the applications that we know and love today are continuing to grow at exponential rates and get bigger, you know, further and further adoption. If you think you know the fact that less just slightly less than all humans on the planet are on the internet with more coming in the future at an accelerated rate and bringing more devices with them, we think that the average device per user will go for about two up to about three and a half over the next few years. So you have the current set of applications, whether it be social media, video, video streaming, they continue to grow. >>And then there is a whole new set of applications that we'll see. There's a long list. We will see which ones actually transpire. It's hard to predict, but everything from advances in gaming, artificial intelligence, AR, VR services, telemedicine, the continued digitalization of industry in particular, manufacturing, transportation, oil and gas. All of these industries opened up at the prospect for new applications that will run on top of these infrastructure that will drive exponential growth in bandwidth and also will, will require much, much better latency from the actual network infrastructure. So there are areas that we're focused on and delivering the innovation and the core building blocks to allow our customers to build these networks to offer these services. >>Well, one of the other challenges, and you've talked about these, these transitions in this step function that networking tends to do is the cost involved when you go from one generation to the next. Cisco of course, has a large optics business know major player in the industry. Talk to us a little bit about what 400 gig means today and have people should be thinking about the cost of these types of solutions. >>Yeah, it's interesting. Certainly as we've, as we've seen from each generation as the interface speeds have changed, the actual bomb, the bill of materials for the solution has changed significantly with regard to which piece account for what dollars it used to be. If you go back to the 10 gig generation, the actual networking equipment itself was the majority of the cost. That was the majority of the bomb optic modules that plugged in were a minority. Maybe the optic optic modules were 10 or 15% and the rest was actually the system. As we look to the 400 gig generation that is actually reversed the, we now have network Silicon that is so dense and so fast that eight can power a full 36 ports, a 400 gig on an actual line card. So you're plugging in 36 optical modules to bring that bandwidth to the, to the networking Silicon. >>So as a percentage of the bomb, the optical module is not much higher from a bomb perspective. It also becomes more critical technology with regard to the reliability and the cost of the whole solution. And this is why Cisco is taking a big focus on the optical module space. We've obviously continued our own organic development and we've also been quite active on the M and a front with regard to ensuring that we have the technology and the right R and D programs to be able to deliver very reliable, cost-effective optics at 400 gig and beyond. So you brought up Silicon, so I got to ask the Silicon one question we were covering at the launch in San Francisco, Chuck Robin was there, David Geckler, you had all the top dogs. They're kind of really kind of going off on the future of Silicon, but of course Silicon angle's interested in covering that because that's in our name. >>But the trend is about cloud scale and operational efficiency. And one of the things that's coming out of the cloud trend is an operating model in public cloud and on premise that is proven. That's what people are going through. That's hybrid. How were the SP service providers implementing that? Do you guys see the Silicon one being that opportunity where they can have an end to end software life cycle having operating model? Is that some of the value? So then what's the real story for us writers? So, I mean that's, that's a core aspect of our architecture and our strategy is to have a solution, a full solution that our service provider customers can consume that embodies all of those learnings and all of those operational realities that have built up in the, in the public cloud space. Certainly Silicon one is a key aspect of that with regard to being the fundamental building block from a network processing point of view being the fundamental building block that actually switches traffic that switches pockets and actually routes the traffic through the, through the infrastructure and through the transport network. >>Along with Silicon one we have our embedded software XR seven which is the control plane for that Silicon and it embodies the routing protocols, the management interfaces, analytics, traffic management, QoS services and so forth. But more and more we're augmenting that embedded software with a set of cloud services that are delivered as a SaaS to our customers. That AIDS in operations reduces their deployment efforts, their deployment costs, and also increases reliability of the whole solution. As the SaaS services are augmenting the physical infrastructure, there's less room for human error. There's less room for integration problems with between the layers in the stack. So it's a key aspect of our savagery. Okay. So let me ask you about the user experience or the application experience. So if I'm developing apps on Silicon one, is it multiple stacks? What's the stack look like? What's the, what's the developer environment look like? >>If I'm a telco or I'm a service provider, what's going on? >> So it depends on the, on the use case, what we announced last month was not only the Silicon and our own products, the Cisco 8,000 that uses that Silicon, but we also announced the offerings of Silicon one through a merchant Silicon program where you know, third parties and OEM, a large customer could actually transact with us on the Silicon alone where we're selling them the actual Silicon. In that context, the Silicon comes with a full featured software development kit that sits on top of that Silicon. You can consider that a device driver if you like an abstraction layer that then allows that third party to either use open source or to build their own network services stack on top of that SDK that can then leverage all of the power in the innovation that is in the Silicon one engine. >>Before I get to my video question because I, cause we're doing video, we care about facts but we love more bandwidth. We love more video action. How do you talk to customers that you meet with? Because we hear a lot from the community and our expert network on the cube alumni that in certain there's a lot of pretender products out there, you bolt on a Nick offload. Where is it okay to have kind of like performance enhancements, performance enhancing hardware. That sounds kind of, that didn't sound right, but performance hardware when when the system is more important. So which customer profiles want more of the Silicon one or Cisco 8,000 versus a either an enhancement product and how does the customer determine what's a fit form one may be look good on paper, low price, high performance. How do you go in and say that's pretending that's a player? >>It's interesting. I think that the fundamental root of the answer to that question is you have to look at the application stack that you're trying to deliver. If it's a homogeneous stack where the applications are infrastructure to deliver services to a third party, then what matters simply is that application and all the infrastructure underneath it. How can you deliver that most cost effectively both in terms of capital costs but also operational cost in terms of power and human operational costs with regard to running the infrastructure. If you, if you think about a heterogeneous situation, public cloud is a good example of that where the public cloud provider is responsible and bears the cost of the infrastructure layer and the customer, the customer themselves are bringing the application workloads to run on top of that infrastructure. In that heterogeneous model. Indeed there might be, you know, some valid business security and operational reasons for actually separating the infrastructure out and having a part in the infrastructure dedicated to run the application on a part of the infrastructure dedicated to the overhead of that application, whether it be virtual networking, security functions, analytics and so forth. >>So it's interesting generally with our customers, what they're looking for more than anything else is bottom line. What is the most efficient way to deliver the end result, regardless of how it's architected, regardless of how the processing is separated into different layers of compute and dedicated hardware, what's the most effective way to deliver the outcome, both in terms of capital cost and more and more operational costs. And as everything gets faster, the power draw is more and more a very dominating function with regard to the ongoing operational costs of these networks. I want to get your thoughts on a couple of trends. One is the comeback. A voice. Stu was riffing about his days were going to voice over IP. Now voice, Hey Alexa, you know there's a small, it's not a real deep bandwidth heavy application, so get great voices coming back that fits a service providers. >>But video is growing really fast. So video is putting a lot of pressure on service providers. What's the state of the art there? Can you make a comment on how you see that evolving? What are they doing and what are some best practices and what are people doing? Yeah, I mean you're exactly right. Video in particular over the top video streaming video, but broadly video at all forms continues to grow at exponential levels. Our analysis, if you look at the Cisco VNI study by 2022 we predict that more than 80% of all internet traffic is actually going to be video. And along with its growth, unfortunately the value per bit goes down because especially as you get higher definition videos in particular, the value per bid to the service provider to the, to the entity bearing the transport cost of the video is actually going down. >>So what that drives our customers to do is first of all provision very high bandwidth networks but also optimize the most cost effective way to deliver that video at very high quality to their end users. I would say there's a few things that are top of mind in achieving that. The first is distributing out the network in particular, distributing out, peering into the Metro areas of the network and no longer having Piering dedicated only at the far side of the backbone when peering is done in the Metro. That traffic is literally on the network for less kilometers. So that helps. I would also say the deployment of edge compute caching and CDN services in the Metro really helps in delivering video. We just got a great tutorial on video architecture in the major highways of the pipes Metro appearing. So changing the dynamics of peering relationships, traffic routes, but ultimately making an efficient. >>Exactly. Well Michael, great to have you on. I know you've got mobile world Congress coming up in February. I always a big show, um, spill some of the announcements for us. I'd love to, but I thought I would be not popular with my bosses by now. Just just teasing you. I know you've got some good stuff on. We're waiting to hear them. We haven't heard anything, but we're getting some rumblings as always. Big announcements for you guys. Congratulations. Thanks for coming on. Thank you so much. I look forward to it. Great insights here on the cube, on the service provider market, the needs, what's going on in the network, and really ultimately video's changing and also the architecture is changing and this is putting more pressure. Again, more bandwidth, more things are happening. This is the Cisco powered cube here in Barcelona. I'm Gianforte Stu Miniman. Thanks for watching.

>>Live from Barcelona, Spain. It's the Cube covering Cisco Live 2020 right to you by Cisco and its ecosystem partners. >>Welcome to the Cube's live coverage here in Barcelona, Spain, for Cisco Live 2020. I'm John Furrier, host of the Cube Dave Volante Ecosystem Minimum here all week in Barcelona, kicking off 2020 With the keynote analysis, Cisco just unveiled their looks like their plan for the year and what looks like a future direction of Cisco again. We were here past two years covering Cisco Live. We'll be at the US show this year as well. David Stew Keynote analysis. Let's get into it right away. Mostly you start to still see the messaging Positioning unfolding in front of us is clearly not there yet. A lot of people have their check boxes that rotation David get kicked it off. I mean, when we kicked it off David gentler key executive, really leading the charge here. But this is about Cisco setting the table. Let's get into it. What do you guys think? I thought it was a good keynote. I thought was a little bit lacking in the story, telling what was the thread was no common thread. Heard a lot of little cloud. I heard a lot of sis card, a lot of speeds and feeds. Everyone kind of has their turn, and all the top people were on there. What's your thoughts? >>Well, who is? Cisco was my first thought. Is your kid coming out of college? You hear that keynote, which I agree was good keynote. But I still wouldn't be sure exactly what Cisco does on. And so I think that you're right, that messaging needs to be tightened up. There needs to be a threat. At the same time, we saw some innovation. They sort of double down on the December announcements and talked about that. I really liked the collaboration that that's been a sleepy market zoom change that woke everybody up. And so we saw some interesting features. Their stuff on app d. They made a lot of claims, which I don't know if they're true or not. It seemed like VM Ware could do some of that stuff and new relic and some of the others dynatrace. But Cisco is coming at it from a networking area of strength, and, um so I guess my bottom line is, I still wanna understand what that threat is, and they talked about multi cloud. I really do think that Cisco is in the best position to connect those clouds to on Prem and Hybrid. They've got the data from the network, and they're in the best position to leverage that for value for their customers. Kind of came through, but I think it's my inference, not their claim. I was >>a little surprised. A This third year we've done this show, and usually there's, you know, the new tag line, and they were reusing the bridge to possible and feels still where things are coming together. Francisco, as you and John were saying, some of the products moving together. So it's awesome chatter on Twitter said, Oh, great Inter site and Empty, actually going to integrate and work well together on that integration messages, one that Cisco's highlighting Cisco's always had a really broad ecosystem. They put up the video about like, you know, if you know the Internet and everything you've done, we've been there, and we're going to drive that for the next generation in the collaboration space. It's not the same WebEx that you've known forever heck, you know, we're gonna have Microsoft with teams and WebEx trying to squint through that a little bit and say, Okay, well, Cisco's got a bunch of devices. Is that all it is? Is, you know, being saying great. You know, I've got Cisco Devices and therefore, if I'm you know, teams customer for Microsoft, I can plug into that. It seems like there's a lot of inter networking pieces underneath the covers there because Microsoft driving hard in that space. Zoom as you said Dave, for the quick, easy experience that that came out of Cisco. So a lot of things moving in the collaboration space. But in the hardcore data, says center space workload Optimizer is something that they were focused on. Talk about the new router Jonathan Davidson, who we'll have on the Cube tomorrow, talking about that space. So Cisco's got a very broad portfolio, and John, I think you nailed it. I did not come out of it. A consistent You know who Cisco is. The message for how we're going to partner with in the future. >>The day bring up a good point college kid looks at This is a good way to kind of zoom out of the technical world. Remember, David Gettler is a technical person. He ran engineering. He sees his big marketing word is multi domain. Come on, Multi domain is not a marketing word. It's just it's a technical feature, but >>this is a >>technical show and a lot of their audience here at the show. We are techies, and so it's clear to me that Cisco's brick by brick building the sass ification, the cloud ification of Cisco and this is something. I think they're not yet ready to pull the switch on Dave as to use a sailing analogy as they attack into the marketplace. They got to do a full turn on the boat. I think this is just the progression. I think it's natural to see Cisco spending millions of billions of dollars as we heard cloud defying and creating this subscription business model. The other notable things is you start to see some tell signs from the keynote, a few little things and I picked up out of this that shows that they're kind of going in the right direction. Still a lot more work to do, and the story needs to be up leveled a bit. I totally agree, rather than just speeds and feeds the classic enterprise. But Wendy hit it clearly. Business model is the new killer app, and I think all the things that we've discussed over the past 10 years to past five, in particular with Cloud Native is the business outcomes is what the APS are focused on. And so they're headlining the event with APP application dynamics, which makes sense. But it's not clear enough that the business model is the key to everything, and you're gonna connect businesses what Cisco does. I mean, what a Cisco Date. They connect business that's been their their mission. From day one, they >>got to take that message, bring it >>up with the applications, are driving business model changes and results. And I think that's the thread they're trying to get through and trying to thread the needle. They're they're just not ready. >>See, from an umbrella messaging standpoint, I think that would have been a lot more effective. But some of the things that I liked in the keynote, you know, Wendy Mars did talk about the importance of privacy, how Europe is leading in diversity. So so that is really important. And they also talked about how last decade was all about enabling APS. And this decade is going to be all about enabling APs and to your point, about enabling business. John. They talked a lot about bringing I t an OT together lists, and Tony really made a big point of that. When we walked into The DEV. Net zone, there was all these network engineers looking at an I O T presentation, these air I t guys trying to learn about the edge in OT. And so I think that's a really important message to the collaboration front. You know, some neat, neat features I just wanted to mention. But my understanding is that Microsoft Teams is all about taking its the old Skype business, which has, like, fallen off a cliff because everybody hates Skype and migrating at the team so they can compete more effectively with WebEx and the rest of them. So again, a lot of different parts of Cisco, but I think there was some definite innovation there, and then when I talked about they're December announcements the optics, the silicon one and the software bringing that together, you know, that is going to power service providers for the next 5 10 years, >>we'll do. I want to get your thoughts here because one of the things that we're observing and they've got hit with teams is that they're kind of groping a little bit on areas. Everyone's gonna get their time on stage. I get that. You know, the comment I made yesterday in our pre game day zero analysis was that there needs to be a Tesla of this industry and to completely change the game. So I think Cisco, if they take the business, we're connecting businesses and looking for a business model. Change is we're gonna look for the engine of the of the car of the application of the company and then what it ISS. So Cisco as a company, is the car, the engines were there, the weaknesses. So if you look at Cisco, all they do is talk about the engine and the features of the Pistons and all the technical speeds and feeds. That's great, but at the end of the day it's a new environment on the business front and I think they got to get that kind of conversion and bring that together Because, of course, they have to check the boxes on. Look, we've got a new engine. We've got new clouds modification. This is where it's at, but it's the destination that you're driving to, which is a business model Outcomes. So, you know, under the hood, are they there? So it seems to be they're still trying to get the engine fixed, and then they could roll out >>one of the things when we always look at all of these keynotes is Are they effectively letting customers tell their story? And does that resonate with what they're talking about? For the piece I saw, I only saw two customers. There was a video with Michael Bay, Great special effects. And actually, you know, I thought it kind of resonated because it's like, Okay, you know, I've got 10 locations shooting around the world and you know, there's terror, bits of information. He's like, I don't even know what a terabyte. It sounds like a dinosaur. And of course, all the networking like Ha ha. You know, you do cool exploding stuff, but you don't know what a terabyte is. And then they had Airbus and Dave, you talked about. Listen, Tony got up on stage and look at it and ot they don't play well together and that's we've done research, looking at the challenge of really delivering on I ot it is that schism between I T and OT and I would have loved to hear a little bit more because she said, Oh well, our tools just enable ot to work on anything. It's not that easy. Just >>well, I throw >>those two worlds >>together, key their security, and we're talking about securing critical infrastructure and really, that's a whole new opportunity in realm. I mean, it kind of came through, but But that's the linchpin is really securing that critical infrastructure, whether it's power plants, it roads, all kinds of logistics and a >>lot of one on Dave. I mean, this is the whole point about Cisco's challenges. One from a story standpoint is complex from a technology integration standpoint complex because you got application awareness, which is going down to the network. And then they showed a lot of that, and I thought that was a key highlight that didn't actually come through, but they did present it. They got the clarification story And then they got network automation all those things, as well as five g around the corner. Silicon One is a lot coming >>together. Nailed that, I mean, no doubt, >>a lot coming together. And I think the key is Is that Scott? Harold nailed it. I think we get clearer and the team are right on the money. On terms of the engine is intent based networking. Multi domain. Is that to me means multi cloud and hybrid. Nail that, and you can get those kinds of innovations. And I think Scott Harrell said it. Simplification is key security and inclusive of the cloud that one word to use, he said. We're talking about something that's inclusive of cloud. He really slam Cloud, he said. You know, it's a fancy place. It's Nirvana. But don't forget the intent of having the on premise basically. So I thought that was a nice thread, the three layers of insight security business in I T. But to me it's simple. I think Cisco needs to think differently around how they position themselves, because if they're going to throw WebEx out there and throw out all these analytics and data, they're a data company. They're a data first company, and they have to be a video first company of its five G. And they got to be a virtual first company because the new future workplace is about having those kinds of workloads running those kinds of app set, you know, feed the modern enterprise. And to me, my premise is, if you can automate it, it's not a feature for the modern modern enterprise has. Automation will be critical of everything, and you can't have bloated software running virtual first environment. >>But to your point, Cisco's advantage is that the data is running through the network, so they have visibility on that data. So they are in a very good position to leverage that data for automation and to connect businesses. Networks of data video is killer feature for that. I mean, they really are the only company right now in the business that can do that. >>Yeah, actually, I like the analogy. They said you should think of the network as a sensor. This is what's going to be able to drive your insight and outcomes. It's not just the plumbing anymore, but you know, that's one of the earliest areas where we drove analytics and data out of everything that's going on and set them up for that machine learning and AI world that people are driving toe extract data >>and to your point on cloud. I mean, look it. They know that you sort of reference that the cloud is slowly eating away at their opportunity because I T practitioners will tell you what the more we do in the cloud, the less we're gonna have to spend on our own network year. >>Yeah, but here's the thing that's coming out. And during the SD win section, I was making some comments >>on >>YouTube channel. SD Win is really, to me, a bellwether of how this goes because latency matters. If you're in the Cisco ecosystem, it's late in the late latency. And if the win is the new land, which is my premise than the interactions with security between the routes becomes critical, right? So you have to have that kind of insight. So we look at something like Web experiences on the collaboration side is that product truly defined for that environment? And I think you mentioned Zoom earlier as kind of waking everyone up is they've built a product around latency and around the environment around land, not the land. So WebEx and desktop is not the state of the art. So unless you got an NVIDIA graphics card designed into it and gaming rig, it's gotta be mobile. It's gonna be over a land link for virtual. And I think if the software to bloated, it's not gonna work. And I think that's gonna be an area that Cisco is going to look at and say, Does these products fit this new use case? >>Okay, so let's say three days of coverage, right? We did. Day Zero is actually four days of coverage for us. We got a lot of good guests coming on. A lot of Cisco execs. What >>are you guys looking for? This. Let's go look at the week we had a lot of guests coming on. Dave's do. What are you guys looking for? In terms of analysis? What are you looking to tease out of the show? >>Well, like any of these shows, I'm really trying to look at the substance, trying to understand the announcements that they're making, how real they are and how they map into the customer's view of what it is that they need. I say the collaboration thing is interesting to me. I was really concerned about Cisco. I thought they were just sort of sitting on their laurels. I think they're WebEx install Base is gonna really look hard at these features. If they're in fact, they're available. I want to understand from practitioners and particularly service providers, You know what they think of all this new stuff that's coming out cause it's expensive. But that's a big, big cap ex investment for these guys. And I want understanding the core Cisco business, their their data center business, their networks. They're hyper converged where they stand competitively. And the last thing is the partner ecosystem. You know, we've talked about how they have to walk a fine line between, you know, servicing guys like IBM and Netapp and then also competing with their former great partner in EMC now Dell, EMC, and how they're gonna go forward in the next 10 years. >>Yeah, you touched on the partner ecosystem and service riders. Edge is the next big opportunity for Cisco, and how will they leverage what they're doing to support all of those partners? going forward. Big thing I'm looking for this week as well as a Z you said Dave. Maturation of a lot of the pieces that they add. Where's the substance behind the announcements that they've made? How much of them are table stakes that we see some of the other environs? Collaboration Space John. As you said, Oh, here's these things on the desktop I could do all these things on my phone was so trying to understand what is differentiated >>awesome for me I'm looking for actually, we're in the Dev Net Zone Cube. I'm looking for the developer equations that came up clear, kind of last with Susie Wee. But she put the new world of developers that's going to change the whole CC certification area and on the ecosystem. And for the developers, it's a C I O T. D and a center Inter site an umbrella. Outside of that, I'm gonna be looking for how Cisco is looking at cloud ification of networking network as a service way into Cloud versus internal SD win simplification of the edge security and networking common policy to name a few know talk a WiFi. I mean, WiFi is the preferred connectivity point inside the enterprise. And how does that relate to the whole edge thing? Application awareness. I really jazzed up by app D and I think where they're going with that is really gonna be the front end of that network policy. And that application awareness is critical on finally network automation from See I CD pipeline into analytics and how that relates to Fixed Wireless the five G, which is going to be I o. T. In the subscription based model. So yeah, to me, that's the That's the big picture. I want to dig into those areas >>that you are the things if I May 1 is this gestalt of, um, I'm gonna buy best of breed or am I going to buy from, you know, one throat to choke? And I think Cisco is obviously trying to be the ladder, and I think the last for me. Security, security, security. And how is Cisco going to help practitioners implement the best security possible? >>Yeah. And John John mentioned in the DEV. Net zone. It is that modernization of the workforce, one of the last things in the keynote they want, accelerate the 1st 500 certified definite engineers out there. So what Sisi Iea's had been doing for many decades, many of them in the future are going to be part of that dev net with security being one of the key areas that we focus >>on. And, of course, we're the top story that so far out of the keynote to me, the top story so far is that Cisco is not gonna yield to the big cloud guys, They're brick by brick moving the needle on their rebooting of their products to be cloud enabled for hybrid. And then ultimately, in multi cloud. And I still think the big switches coming. They haven't pull that lever. They haven't yet made a big move, I think a lot more to come. So we're gonna be digging in to the guys. Thanks for the analysis. Keynote analysis here. Day one of Cisco live in Barcelona kicking off in setting the agenda for 2020. It's the cube coverage. I'm John for Stu Minima Dave Volante. We'll be right back with more live coverage after this short break. >>Yeah, yeah, yeah

>> Announcer: Live from Barcelona Spain, it's theCUBE. Covering Cisco Live 2020. Brought to you by Cisco and its ecosystem partners. >> Hello everyone, welcome to theCUBE here live in Barcelona Spain for Cisco Live 2020. This is our first CUBE event for the year. Next 10 years of CUBE history, we look back 10 years since we've been around, for 10 years, we have another 10 more we're looking forward to. And this is the first event for 2020 Cisco Live at Barcelona. I'm John Furrier, your host, with Dave Vellante, Stuart Miniman, extracting the signal from the noise. The cloud business is noisy, the networking business is under siege and changing, Dave and Stu we're pre gaming, Cisco Live, kicking off the show, end of the first kind of pre day, Tomorrow's the big keynotes. David Geckler, Verizon exec is preparing to announce rumor has it some insights into what Cisco's position will be vis a vis cloudification, that's going to change their portfolio and probably identify some opportunities, and also some potential gaps in their strategy and what they can do to be competitive. The number one leader in networking, they got a great market position. But cloud is changing the game with networking. >> Yeah, john, it's funny, I heard you talking about, the 10 years and everything. 10 years ago, if I thought about Cisco, I'd be looking at the I pattern of getting the jitter out of the network and trying to tweak everything. And today, what are we talking about with Cisco? We're talking about software, we're talking about cloud. We're talking about developers. Yeah, they're a networking company at its core, but Cisco has been going through a significant transformation, it's been an interesting one to watch. Dave, you wrote a little bit about, Cisco is one of the four horsemen of the internet era, of course the dotcom, they were one of the ones that actually survived and thrived after the dotcom burst, but Cisco is a very different company today far from the $500 billion market cap that they had a few years back, they were at about $200 billion, but still dominant in switching and routing. But there are threats from a number of environments and a lot of changes as to what you need to think about when it comes to Cisco. >> Well, sometimes it's instructive to look back and see how we got here. Cisco made three big bets during its ascendancy, the first one was it bet on IP, I mean, John, you've talked about this a lot, it decimated the mini computer industry by connecting distributed computing and client server, the underlying plumbing there. The second big bet it made was it trained a bunch of engineers, the Cisco certified engineers CCIEs, and they used that as a lever and created a whole army of people that were Cisco advocates, and that was just a brilliant move. And the third was under the leadership of John Chambers, They did about 180 acquisitions, and they were quite good at acquisitions and what that did for them is it continued to fuel growth, it filled in gaps and it kept them relevant with customers. Now, part of that, too, was, Chambers had dozens and dozens of adjacent businesses, remember, he said they were all going to be a billion dollars. Well, most of them, didn't pan out. So they had to cut and burn, and so but now under the leadership of Roberts, they're a much more focused company, kind of getting back to basics, trying to bet on sure things and so let's talk about what some of those sure things are and how Cisco's performing. >> Well it's clear you said lever, they're got to pull a lever at some point and turn the boat that is Cisco, aircraft carrier, what do you want to call it? In the right direction? That's been something that, we've been covering Cisco for decades Stu as you just pointed out, and while we've been close to all the action, I think Cisco knows what's going on. It's clear to me that they kind of understand the landscape. They understand their opportunities in the future, but they're a massive business, Dave, you pointed it out. The combination of all those mergers. The thing that got my attention was as they understood the unification many, many years ago in the compute side, you saw Cisco clearly understands the unification. They know cloud is here, they know that do not make a move, that's cloud friendly, they were going to get swept away and be adrift with the next wave, which is cloud 3.0, whatever we call it. So to me, that's the big story with Cisco. What is the impact of the company when you cloudify business? That's not public cloud, that's hybrid public, economics are changing, the compute capabilities are changing, the network capabilities are changing, got the edge. I think Cisco will be defined by their actions over the next two to three years. What they announce, how they position it, and what they bring value to the customers because you got Silicon One chip, good move, got cloud position, got App D on the on the top of the stack, you got cloud center, they're trying to get to the cloud, but you can't do that until you have the subscription business, until you, can't do pricing by usage unless you have that model. So I think it's a brick by brick, but slowly they're doing it. We have to hear some things next year on Cisco, on how they're going to be true, cloud enabled? >> Well, software is a huge play for them, right? I mean, they've got it, because Cisco's been the dominant player in networking with two thirds of the market, I mean, they've sustained that for a decade plus, and it has allowed them to drive 60 plus percent gross margins for years and years and years, huge operating margin. So how are they going to continue that? Software is the key. And as you say, John, subscriptions is the cloud model that is critical for Cisco. Now they talk about 70% of their software business is subscriptions and annual recurring revenue, it's unclear really how big their software business is, they give hints, I'd peg it at about seven to eight billion last year, maybe growing to 10, 12 billion this year. So pretty sizable, but that's critical in terms of them driving the margins that they need to throw off free cash flow so they can invest in things like stock buybacks and dividends which prop up the stock. >> Well, the problem is you start chasing your tail on the stock price and or product TAMS and product revenue, you might actually miss the boat on the new product. So it's a balance between cannibalizing your own before you can bring in the new, and this is going to be the challenge with Cisco, when do they bite the bullet and say, "Okay, we got to get a position on this piece here "or that piece there, ultimately, "it's going to be about customers." And what do we know, public cloud succeeded with one data, hybrid cloud is a reality and people are executing specific technologies to do an operating model that's cloud And to me, the big wave for Cisco, in my opinion, is multi cloud, because that's not a technology. That's just, that's a value proposition, it's not so much a technology. >> Yeah, Dave, you mentioned a lot of the acquisitions that Cisco has done. In many ways, though, some of the areas where Cisco can be defined is the acquisitions that they didn't do. Cisco did not buy VMware, and were behind in the virtualization wave. And then they created UCS and that actually was a great tailwind for them, created their data center business. They did not end up buying Nicira, and yet, Nicira's done very well. But if you talk to most customers well, even if you're deploying NSX, whose hardware do you tend to have? Well, yes, sure, it might be Arista, might be somebody else's but Cisco still doing good, going well, so they haven't had, there hasn't been a silver bullet to kill Cisco's dominant, but how are they going to do without cloudification? The data center group has gone through a lot of challenges. If you look at they fumbled along with OpenStack, like many other companies did, they went through just as VMware really failed with VCloud Air, the cloud group inside of Cisco had, they had this large Cisco offering that for a couple of years, everybody's looking, I don't know, are you enabling service providers? What are you doing? Now they have management pieces, they're partnering with Google, Amazon, Azure, across the environments, they are heavily involved in Kubernetes and the service meshes. So it remains to be seen where Cisco will find that next Tam expansion to kind of take them to the next wave. >> But Stu, acquisition is a good piece. And what I think they got to do some M&A clearly and organic but the question is would Nicira have been successful at Cisco versus VMware. Look at the timing of that, I think VMware being bought would have been a home run. But Nicira, I don't think that succeeds at Cisco. I think that would be a bunch of knife fights internally. And Nicira would have been shifted up because what it was then and what it is now and VMware are two different things because VMware took it, and shaped it, that I don't think Cisco could have done it at that time, >> The success would have been a defensive move to keep VMware out. That would have been the nature of the success, but I think you're right, the infighting would have been brutal, but VMware wouldn't have Nicira. >> VMware, What they did when they bought Nicira is they spent the first three or four years just making it an extension of VMware. Now it's starting to become their multi Cloud Interconnect. And that's where we need to see Cisco be involved. Cisco's bought many companies that have promised to be multicloud management or that interconnecting fabric and they have not yet panned out. >> Well, security is the linchpin though here, they've made a bunch of acquisitions in security. And I've always said that they've got a position, their networking is the most cost effective, the highest performance and the most secure to connect multiple clouds to hybrid on-prem. And they're in a good position to do that. >> Well, I think I've always said this from day one, you guys know I'm harping on this, Stu and I, we High Five each other all the time when we say this, but back in the days in IT days, the heyday, if you were a network operator, network designer, network architect, you were the king, king or queen. So you had the keys to the kingdom. VMware is a legitimate threat to Cisco. They compete, and they talk about that all the time. But the question is, which community has the keys to the kingdom? Rhetorical question. >> Yeah, well John one point I made earlier, (John laughing) >> Okay, go ahead. >> I remember Pat Gelsinger got on stage and he's like, "Hey, here's the largest collection of network admins" and everybody's looking at him, what are you talking about Pat? When I talk to customers that are deploying NSX, it is mostly not the network team, it is the virtualization team, and they're still often fighting with the network team. But to your point, where I've seen some of the really smart network architects, and people building stuff, Amazon, Azure, Google all have phenomenal people, and they're building environment back Cisco needs to make sure they partner and are embedded there. >> If you, Dave mentioned the leverage. Cisco's got to pull that lever or, turn the boat around and one shift move now, or otherwise, they'll lose that leverage. They have more power than they think in my opinion, they probably do know, but they have the network. And I think the network guys trump the operating guys, because you always swap in operating staff, but you got the network, and the network runs the business. No one could swap out Cisco boxes for a Synopsis years ago, so or Bay, whatever it turned into, so they have that nested position. If they lose that they're done. >> Yeah, and I agree with you, John, there's a lot of, Stu, you pointed out this, people buy NSX and Cisco ACI, but my question is, okay, how long will that redundancy last? I think, to your rhetorical question, Cisco is sitting in the catbird seat and they know networking, they're investing in it. I don't think they're going to lose sight of that. Yeah, wrist is, common Adam and Juniper, but Cisco, they know how to manage that business and maintain its leadership. I guess my question is, have they lost that acquisition formula? Are they as good at acquisitions as they used to be? >> I think their old model's flawed for the modern era. I think the acquisition's got to come in and integrate and I think VMware has proven that they can do acquisitions right. I think that comes from the EMC kind of concept where it's got to fit in beautifully and have synergies right away. I think what Pat Gelsinger is doing I think he's smart and I think that's why VMware is so successful. They got great technical talent, they know the right waves to be on and they execute. So I think Cisco has got to get out of these siloed acquisitions, this business unit mindset and have things come in, if they work, in line with the strategy and the execution. It has to from day one, I've got it. You got to be fitting perfectly in. >> The portfolio is still pretty complicated. You got the core networking. You got things like WebEx, right? I mean, would you want to be going up against Microsoft Teams? But they're in it, Cisco's in it to win it, and they got to they got to talk about-- >> Don't count out Zoom. >> Talking about, no, Zoom's right there too in the mix. And so Cisco's got some work to do, expect some enhancements coming there, in HCI, they've got to walk a fine line Stu, you made this point. On the one hand, they've got, IBM and NetApp with UCS and conversion infrastructure, but then they buy Springpath, which is designed to replace converged infrastructure. So they've got to walk that fine line. >> All right, what are you guys going to hear this week? Let's just wrap this up by going down the line on thoughts and predictions as the keynote kicks off tomorrow, I took some notes, I was doing some, going around the floor trying to get inside people's heads and ask them probing questions. And here's what I got out of it. I think Cisco is going to recognize cloud and absolutely throw the holy water on the fact that it's part of their strategy. I think we'll hear a little bit about Silicon One and how it relates to the portfolio, but I think the big story will be how tying the application environment together with networking, not end to end but really as one seamless solution for customers. I think it's going to be a top story that's been teased out by some of the booths that I saw, connecting things as one holistic thing with application development focus with DevOps. >> Yeah, so John, ACI was application centric infrastructure. And it was critical back in back in the day there is like, well, the application owner really doesn't have much connection there. If you look at what Cisco has been doing the last few years, it is tying together more that application owner, the DevNet group that, we're sitting here in the DevNet zone, that connection between the developer and making enabling them as part of the business absolutely is a wave that Cisco needs to drive. I don't think we're going to see a ton of the Silicon One, 5G and that kind of stuff, if for no other reason then in about a month, they're going to be sitting here with 100,000 people from Mobile World Congress and that's where they keep their dry powder to make sure that they push that piece of it. But that is super important, so and yeah. >> I think, software and security, I mean, I, as you were talking about, Zoom, Teams, so they better focus on collaboration and I want to hear some stuff there, security, IoT and the edge. They've got a very strong position there. Their security, Cisco security business grew 22% last quarter, it's really doing well. So I want to hear more about that. And I think data center, what they're doing in the data center, what they're doing with their switching business, their HCI stuff and converged infrastructure, hyper converged and, three important areas that we'll hear about this week. >> And Dave, I'll emphasise on what you were saying. Edge edge edge, absolutely, if Cisco is going to maintain a dominant player in the network, they need to deliver on that edge. And I've heard a couple of messaging strategies in the past, there was fog computing and all this other stuff, but I think Cisco is in a position today between Meraki that they have between their core product, >> Dave: Devnet. >> To really be able to enable-- >> And those are really-- >> Well, I want to see more progress, I'm looking forward to see, I'm going to drill them on the interviews we do here. They spent millions, billions of dollars satisfying and creating a subscription model with the cloud. We're going to dig into it, we're going to extract the signal from the noise, theCUBE coverage here in Barcelona, Spain. First show of 2020, Cisco Live 2020, I'm John Furrier, Stuart Miniman, Dave Vellante. We'll be right back. (upbeat music)