>> Announcer: Live from Orlando, Florida. It's the Cube. Covering, Grace Hopper Celebration of Women in Computing brought to you by Silicon Angle Media. >> Welcome back to the Cube's coverage of the Grace Hopper Conference here in Orlando, Florida. I'm your host Rebecca Knight. We're joined by Jarvis Sam, he is the manager of global diversity issues at Snap Inc. Welcome. >> Thank you so much for having me. I'm really happy to be here. >> So, I've gotta--first of all, you're wearing a Rosie the Riveter shirt, we've got these tchotchkes here, can you explain to our viewers a little bit about them? We got to, we got to talk about these first. >> Of course, so, the shirt was actually inspired by our Lady Chilla, that's our local women employee resource group at Snap. The idea was take the ghost, a representative mascot of Snap Inc. and parlay that with the idea of Rosie the Riveter, of course powerful in her own right. >> Rebecca: Alright, I love it, and then these spectacles are...? >> Yeah, so spectacles are Snap Inc.'s first ever hardware product released earlier this year. They allow for you to take an in-the-moment Snap, to be featured on your phone, using Bluetooth technology for iPhones and then WiFi technology for Android. They allow individual users to record Snaps on their phone, while of course not distorting the experience of being able to use their hands in the moment. >> Rebecca: So, I love it, these are the recruiting tactics: your own products. >> Exactly >> Want to play with these toys? Come work for us? >> Yes! >> So, tell us a little bit about what you do, Jarvis. Before you were at Snap, you were at Google. You were interested in really engaging in these diversity issues. So what do you at Snap? >> Yeah, so, at Snap, I manage our global diversity effort. What that includes is analyzing the diversity framework across three key verticals; first on the pipeline layer. So, what are we doing by way of K-12 education to ensure communities of color as well as women-- >> Rebecca: K-12? Wow. >> Exactly. >> Have specific opportunities in the space to be impactful. We often create this framework or archetype for what we think is ineffective software engineer for example or account manager. Reframing that by providing access and opportunity is showcase to people that the image that we have is not always the image that we want to portray, is critical. Next then we focus heavily on the idea of the candidate, so candidate experience. Deep diving into understanding key talent acquisition measures as well as key HR practices that will allow for us to create the best experience, moves us forward in that regard. But then finally, and this is where we get to the whole global perspective. Is the idea of the employee. Creating a nurturing community where the idea of psychological safety is not only bolstered but ensuring that your community feels empowered to the idea of inclusion. Making sure inclusion is not just a seat at the table but rather a voice in the conversation that can be actioned upon. >> So I want to dig into that a little bit, this voice in the conversation. Before the cameras were rolling you were talking about these very difficult candid conversations that employees at same have. Tell our viewers a little bit more about that. >> Yeah, so I think one of the greatest challenges across the tech industry and at Snap as well is the idea of referral networks. The tech industry on its own right has grown so greatly out of referral networks. People that you have worked with perviously, people that have the same academic or pedagogical experience as you. The problem with that is, the traditional network analysis would seem to let us know that you often refer people who look like you, or come from a similar internal dimension background as yourself. In a community that's largely rooted in a dominated discourse by white or Asian males. That means that we're continuing to perpetuate that exact same type of rhetoric. >> Rebecca: That's who you're recruiting. >> Exactly. And so then idea of getting more women or communities of color involved in that space can often be distorted. So that remains a challenge that we as a company as well as the tech industry need to overcome is understanding; one, how do we encourage more diverse referrals over time. But then two, creating an ecosystem where this seems natural and not like an artificial standard. >> Okay, so how do you do it? I mean that we've pinpointed the problem and it absolutely is a problem, but what are the kinds of things that Snap is doing to improve the referral process? >> So it's the idea of being innovative by design. One thing that's unique about Snap in particular is that we are an LA-based company. >> So based out of Venice Beach and Santa Monica, California. We don't face a lot of the core challenges that we see in Silicon Valley. And as a result have the opportunity to be more innovative in our approach. As a result when we look to referral networks in particular. One thing that Snap has focused on is the idea of diversity recruiting as a core pillar or tenant of all of our employee research groups. Not only do they join us to attend conferences like Grace Hopper, like the National Society of Black Engineers. But we actually do sourcing jams. Where we sit down with them and mine their networks. Either on LinkedIn-- >> Rebecca: Sourcing jams? >> Yes >> Rebecca: I love it. >> Yes Either on LinkedIn or GitHub or any of the various professional networking sites that they work on. Or technical networking sites to find out who are great talents that they've worked with before. >> Who do you know? Who can join us? >> Exactly. And what's more significant than that, is creating a sense of empowerment where we actually having them reach out to their network as opposed to a recruiter. This creates more of a warm and welcoming environment for the candidate. Where the idea of being a simple passive candidate is further explored by activating them to showcase how your experience has been great. >> And how are you also ensuring that the experience at Snap is great, particularly for women and people of color? >> Yes, so one area is our employee resource group. So we have a couple, so Lady Chilla is of course what I am wearing today. But Snap Noir for the black community. Snap Pride for the LGTBQ plus community and Low Snaps for the Latin X community. >> Rebecca: How big is Snap, we should just-- >> Yeah, about 3,000 people globally. >> Okay, 3,000. Okay, wow. >> And so one of the exciting things that we do is ERG that. So it's where we bring all of our employee resource groups together and they hold massive events every single quarter. To encourage other communities that are either allies or individuals of the sociological out group to understand what they do. But this deploys in so many different ways. In June, for Pride for example, we held drag bingo. Where our LGTBQ plus community participated. In March, we did a whole series of events celebrating women in engineering, women in sales, and women in media that resulted in a large expanse of events allowing for people to come in and learn about, not only the female experience more broadly, but particularly at Snap and some of the great endeavors that they're working on. >> And I know you are also working with other organizations like Girls Who Code, Women Who Code, Made with Code. Can you tell the viewers a little bit more about Snap's involvement. >> 100% Made with Code is one of the most exciting projects that I've had the opportunity to work on. It was for me personally this great combination of working with my previous employer Google, and Snap. So Google's Made with Code project is an idea that started to empower teen girls to code, ages 13 to 18 primarily. What they found is was that's exactly the same demographic that primarily uses our product. And so about three months ago, we decided to come together to launch an imitative where we'd have teen girls make geofilters, one of Snap's core products. The project actually launched one week ago, and teen girls are using Blocky technology to actually go about creating their own geofilters. And then writing a 100 word personal statement defining what their vision for the future of technology is. I'm personally exciting to say after checking the numbers this morning, more than 22,000 girls have already submitted responses to participate. And they will culminate in an event, November 1 through 3. Where we will take the top five finalists to TED Women in New Orleans. To not only showcase women who have done incredible things in the past and present. But also showcase their work at participating in this competition, as the women of technology for the future. >> Rebecca: And the next generation. >> Exactly. >> So we're running out of time here, but I want to just talk finally about the headlines. It's very depressing, you know the Google Manifesto, the sexism that we've seen against women. The racism in the industry. These are are-- we don't want to talk about it at this celebration of computing because we want to focus on the positives. And yet, where do you feel, particularly because you have worked at large tech companies, on these issues for a while now? >> Not facing challenges head on is going to be the greatest threat to the tech industry. The idea of avoiding conversation and avoiding sheer communication of these challenging issues will continue to raise-- >> Rebecca: And ignoring the bad behavior. >> Exactly, and it results in negative rhetoric that inherently put these communities out of wanting to work in this specific industry. But arguably given that technology not only represents the face of the future but how every single product and entity is made for the future, we have to include individuals. Everyone often wants to highlight the McKinsey study from Diversity Matters. Highlighting all of these great ways of diversity impacting business, but we need to look at it in addition from an ethic standpoint. The idea that technology represents how we are building our future. Leaving entire communities out of that primarily focusing on people of color and women, will result in a space where these communities will never have access, opportunity and thus employment to exist in this space. Being able to attack these issues head on, address the bad behavior, highlight what the potential implication is step one. Step two though is being proactive in everything that we're doing, to attempt to ameliorate that from the beginning. You'll notice one thing that's very different about Snap's diversity strategy is we seek to build infrastructure first, then focus on talent acquisition. Once we can ensure that communities of color and women are entering a space that is psychologically safe, open, and inviting. Then we can focus on how we're bringing in talent effectively so that the idea of retention and advancement is not an afterthought but rather top of mind. >> Right, because you can't recruit them if they haven't had the opportunities to begin with. >> Exactly, and that's what Snap often upholds the value of the idea that diversity is our determination, while inclusion is our imperative. >> Jarvis, I love it. >> Thank you so much. >> This has been really fun talking to you. >> Thank you. >> We will have more from Orlando, Florida at the Grace Hopper Celebration of Women in Computing just after this. (upbeat music)

>>Hello, brilliant cloud community and welcome back to AWS Reinvent, where we are live all day every day. From the show floor here in Las Vegas, Nevada. I'm Savannah Peterson, joined by my beautiful cohost Lisa Martin here on the cube. Lisa, you're smiling. You're radiating Day three. You would think it was day one. How you doing? >>Amazing. I can't believe the energy that has been maintained omni show floor since Monday night at 4:00 PM >>I know. And I, I kind of thought today we might see some folks trickling out. It is packed as our, as our guests and I were, we were all just talking about right before the segment, almost two packed, which is a really great sign for aws. It is. We're >>Hearing worth of 55,000 people here. And of course we only get a, a little snapshot of which literally >>This corner, >>We don't get to see anything else around the strip that's going on. So it's massive. Yeah, >>It is a very massive, I'm super excited. We've got two guests from Infosys with us on this last segment from this stage today. David and Anant, welcome to the show. How you doing? >>Awesome. >>You're both smiling and I am really excited. We have our first prop of the show and it's a pretty flashy, sexy prop. Anant, what's going on here? >>Oh, so this is something that we are very proud of. Last year we won one award, which was very special for us because it was our first award with aws and that was the industry partner of the year award. And on the back of that, this year we won three awards. And this is super awesome for us because all of them are very special. One was in collaboration, second was in design, and third was in sustainability. So we are very proud and we thank AWS and it's a fantastic partnership. Yeah. And >>Congratulations. Yes. I mean that's >>Huge. Yes, it's absolutely huge. And the second one is we are the launch partner for msk, which again is a very proud thing for us. So I think those are the two things that we wanted to talk about. >>How many awards are you gonna win next year then? >>Do you want to target more than three? >>So we keep going up probably fine, >>Right? I >>Love, >>That's the odd numbers. 1, 3, 5, 7, 10. There you go. >>Yeah, >>I think you, we got that question last year and we said we get two and we ended up overdelivering with three. So who >>Knows? Hey, nothing. Nothing wrong with the setting the bar low and clearing it and I mean, not setting it low, setting it with one and clearing it with three is pretty fantastic. Yes, yes. We talk about it as an ego thing sometimes with awards and it feels great for internal culture. But David, what does it mean on the partnership side to win awards like that? So >>What's really important for us with our partners is to make sure that we're achieving their goals and when, when their goals are achieved in our partnership, it's just the byproduct that we're achieving our own with our clients. The awards are a great representation of that to see, you know, again, being recognized three in three different categories really shows that we've had success with AWS and in turn, you know, know and not, I can attest to it, we've been very successful with the partnership on our side. >>Yeah. And I bet it's really exciting for the team. Just speaking for energy, are your >>Team sponsor? Absolutely. There's celebration, you know, there's been a few cocktails being raised >>In Las Vegas >>Cocktail. Oh, >>I wouldn't mind one right now to be really be really honest. Let's dig into the, into the product a little bit. Infosys Cobalt, what's the scooping on? >>Yeah, so first of all, we were the first ones to actually launch a cloud brand called Cobalt. Right? We are the first ones in the world. In fact, one of our competitor followed us soon after. So essentially what we did was we brought all our cloud offerings into one brand called Cobalt. It becomes very clear to our customers on what our proposition is. It is very consistent to the market in terms of what our narrative is. And it's little easy for our customers to understand what we bring to the table. So is not one product or one platform. It's a set of services, solutions and platforms that we bring to accelerate customers journey where they're leveraging cloud. So that's what Cobalt is. >>Awesome. Everyone wants to do everything faster. Yes. And Booth was packed. I walked by earlier, it was absolutely buzzing. Yes. >>Yeah. Nobody wants to do it, you know, wants less data slower. Yes. Always more faster. More faster. And we're living in this explosion unlike anything, this swarm of data, unlike anything that we've ever seen before. Yes. Every company, regardless of industry, has to be a data company. Yes. But they have to be able to work with the right partners. Absolutely. To extract, to first of all, harness all that data. Yes. Extract insights in real time. Yes. Because of course, on the consumer side, we're not patient anymore. Yes. We expect a personalized, real time custom experience. Absolutely. How do you work with AWS to help deliver that and how do the partners help deliver that as well? >>Well, I'll start with on the partner side of it. You walk through the hallways here or down the aisles, you see partners like MongoDB, snowflake, data Bricks and and such. They're all attest their commitment and their strong partnership with aws. And coincidentally, they're also very good partners of our own. And as a result, what >>Big happy family here at AWS when you >>Met? Yes, and this, this is something that I'm, I'm calling coining the phrase sub ecosystems. These are partnerships where one is successful with each other and then the three come together and we go together with an integrated solution. And it's really taking off. It's something that's really powerful. The, the fun thing about, you know, reinvent here is it's just that we're having amazing discussions with our clients and aws, but we're also having it with the other partners here about how we can all work together. So, and data analytics is a big one. Security is another hot one. This is huge. >>Yeah. Optimization. >>The absolutely. And I, and Ruba was saying this, right? Ruba said like she was giving example of a marathon or Marathon is not a single man or a single woman sport. Right? So similarly cloud journey is a team's sort of, you know, team journey. Yeah. So that's why partners play a big role in that and that's exactly what we are trying to do. >>So you guys get to see a lot of different companies across a lot of different industries. We've, we're living in very interesting times. How do you see the cloud evolving? >>Oh yeah. So, so what we did when we launched Cobalt in 2020, we have now evolved our story, we call it Cobalt 2.0. And essentially what we want to do was to focus on industry clouds. So it's not just about taking a workload and doing it from point A to point B or moving data to cloud or getting out of data centers, but also being very specific to the industry that this specific customer belongs to. Right? So for example, if you go to banking, they would say, we want to better our security posture. If you go to a retailer, they want to basically have smart stores. If we go to a manufacturing customer, they want to have a smart factory. So we want to make sure that there are specific industry blueprints and specific reference architectures that we bring and start delivering outcomes. So we have, we call it something called, >>I know you're hot on business outcomes. Yes, yes. >>So we call it something called the link of life forces. So there are six technologies, cloud, data Edge, iot, 5g, and ai. They will come together to deliver business outcomes. So that's where we are heading with Cobalt 2.0. And that's essentially what we want to do with our customers. >>That's a lot to think about. Yes. And yeah, go for it. >>David. I just say from a partnering perspective, you know, prior to cloud we were talking about transactional type businesses where if you ask a technology company who their partner is, is generally a reseller where they're just basically taking one product and selling it to their, their client. What's happened with cloud now, it's not about the transaction up front, it's about the, the actual, you know, the consumption of the technology and the bringing together all of these to form an outcome. It changes the model dramatically. And, and quite honestly, you know, the global system integrators like emphasis are in a great position cuz we can pull that together to the benefit our of our partners put our own secret sauce around it and take these solutions to market and drive consumption. Cuz that's what the cloud's all about. >>Absolutely. Right. How are you helping customers really treat cloud as a strategic focus? You know, we, we often hear companies talk about we're we're cloud first. Well, not everything belongs in the cloud. So then we hear companies start talking about being cloud smart. Yes. How are you helping? And so we'll go with that. How are you helping enterprises really become cloud smart and where is the partner angle? So we'll start with you and then we'll bring the partner angle in. >>Sure. Oh yeah, big time. I think one of the things that we have been educating our customers is cloud is not about cost takeout. So cloud is about innovation, cloud is about growth. And I'll give two examples. One of one of the beauty products companies, they wanted to set up their shop in us and they said that, you know, we don't have time to basically buy the infrastructure, implement an er p platform and you know, or roll it out, test it, and go into production. We don't have so much time, time to market is very important for us. And they embarked on the cloud journey. So expanding into new market cloud can play a big role. That is one of the ways to expand and, you know, grow your business. Similarly, there is another company that they, they wanted to get into retail banking, right? And they didn't have years to launch a product. So they actually use AWS and it's a joint infos and AWS customer, a pretty big bank. They launched into, they launched retail banking and they did it in less than six months. So I think these are some of the examples of, wow, it's Snap Cloud not being cost takeout, but it's about innovation and growth. So that's what we are trying to tell >>Customers. Big impacts, big impact. >>Absolutely. And that's where the, the Cobalt assets come into play as well. We, you know, as as not mentioned, we have literally thousand of these industries specific, and they're derived in, in a lot of cases in, in, in partnership with the, the companies you see down the, the aisles here and, and aws. And it accelerates the, the, the deployments and ensures a accessible adoption more so than before. You know, we, we have clients that are coming to us now that used to buy, run their own procurement. You know, they, they would have literally, there was one bank that came to us with a over a hundred, >>The amount of work. Yeah. >>A list of a hundred products. Some they bought directly from a, a vendor, some they went through a distributor, something went through a, a seller and such. And they're, they're, now they're looking at this in a completely different way. And they're looking to rationalize those, those technologies, again, look for companies that will contract for a business outcome and leverage the cloud and get to that next era. And it's, it's a, it's a fun time. We're really excited. >>I can imagine you, you're really a part of the transformation process for a lot of these companies. Absolutely. And when we were chatting before we went live, you talked about your passion for business outcomes. Can you give us a couple examples of customers or business outcomes that really get you and the team excited? Same thing to you, David, after. Yeah, >>Well, absolutely. Even our contractual structures are now moving into business outcomes. So we are getting paid by the outcomes that we are delivering, right? So one of the insurance customers that we have, we actually get paid by the number of claims that we process, right? Similarly, there is a healthcare customer where we actually get paid by the number of customers that we cater to from a Medicare and Medicaid standpoint, right? >>Tangible results versus >>Projected forecast. Successful process of >>Claims. That's interesting. Exactly. Yeah. I love reality. Yeah, reality. What a novel idea. Yeah. >>One of the great examples you hear about airplane engines now that the model is you don't buy the engine. You basically pay for the hours that it's used and the maintenance and the downtime so that they, you take the risk away. You know, you put that in the context of a traditional business, you're taking away the risk of owning the individual asset, the maintenance, any, any of the issues, the bug fixes. And again, you're, you're partnering with a company like Emphasis will take on that based upon our knowledge and based upon our vast experience, we can confidently contract in that way that, you know, years ago that wasn't possible. >>It's kind of a sharing economy at scale style. >>Exactly. Absolutely. >>Yeah. Which is really exciting. So we have a new challenge here on the cube this year at ve We are looking for your 32nd Instagram real sizzle sound bite, your hot take your thought leadership on the, the biggest theme or most important thing coming out of this year's show. David, we'll start with you. We've been starting with it on, I'm to go to you. We're making eye contact right now, so you're in the hot seat. >>Well, let's, I I think there's a lot of time given to sustainability on the stage this week, and I think that, you know, every, every CEO that we talk to is bringing that up as a major priority and that's a very important element for us as a company and as a service >>Provider. I mean, you're obviously award-winning and the sustainability department. Exactly. >>Yes. Nice little plug there. You know, and I, I think the other things that have come up, we saw a lot about data analytics this week. You know, I think new offerings from aws, but also new partnerships that we're gonna take advantage of. And, and again, security has been a hot topic. >>Absolutely. And not, what's your hot take? >>Yeah. I think one, one very exciting thing for partners like us is the, the reimagining that is being done by rhu for the partners, right? The AWS marketplace. I think that is a big, big thing that I took out. Of course, sustainability is huge. Like Adam said, the fastest way to become sustainable is to move to cloud, right? So rather than overthinking and over-engineering this whole topic, just take your workloads and move it to cloud and you'll be sustainable. Right. So I think that's the second one. And third is of course cyber security. Zscaler, Palo Alto, CrowdStrike. These are some of the big companies that are at the event here. And we have been partnering with them many more. I'm just calling out three names, but many more. I think cyber security is the next one. So I think these are three on top of my mind. >>Just, just a few things you casually think about. That was great, great responses from both of you and David, such a pleasure to have you both with us. We hope to have you back again. You're doing such exciting things. I'm sure that everything we talked about is gonna be a hot topic for many years to come as, as people navigate the future, as well as continue their business transformations. It is always a joy to sit next to you on stage. Likewise. Thank you. And thank all of you wherever you're tuning in from. For joining us here at AWS Reinvent Live from Las Vegas, Nevada, with Lisa Martin. I'm Savannah Peterson. And for the last time today, this is the cube, the leader in high tech coverage.

>>Hi there. Welcome back to the cubes day. One coverage of VMware Explorer, 2022 from San Francisco, Lisa Martin and Dave Nicholson. Dave, we've been here all day, having some great conversations with the VMware partner ecosystem >>With real live people >>Within in 3d. Yeah. People actually sitting down next to us still >>Appreciated, even though, you know, we've, we've done a few of these events, but yeah, it feels like things are getting back to normal. >>It does. You and I were both in the keynote starting this morning, standing room only. We're hearing somewhere between 7,000 and 10,000 attendees. Yeah. We're in Moscoe west. So we're kind of away from a little bit of the, the main action. But talk to me about some of the things that you heard this morning in the keynote, some of the announcements from VMware, did it meet your expectations? >>Yes. And because I didn't expect, you know, this is very, very different than going to say an AWS event where they're going to launch 300 new shiny objects. This was very much in my mind so far about VMware focusing on its core value proposition and an aspect of its core value proposition that is the cloud stack and how they are shoring up places in that strategy that needed shoring up like addressing issues with licensing. So you don't have to have separate licensing for on premises, VMware things. You're doing separate licenses in hyperscale cloud providers for doing those very same things that looks like something that's going to roll out over time. That's very, very interesting. Something that wasn't really wasn't mentioned directly, but, but, but actually one of our guests mentioned it. It's this idea that if you take the VMware cloud provider partner, community VCP P is the inside term for it. >>There are thousands of VMware partners that deliver VMware cloud software on top of infrastructure, all around the globe. If you take that VCP P community as an entity, you can argue that it is the third or fourth largest cloud on earth. If you look at that as a core value proposition and you look at Broadcom, acquiring VMware, assuming everything goes through it, isn't just vSphere. That is exciting to Broadcom, or it shouldn't be at least because you have the entire cloud stack when you look at it from that perspective. And I think they were trying to get some of that across today. >>So they address the Broadcom acquisition obviously is the elephant in the room. It was right. Impossible. >>Well, well, they have OC 10 stand up in wave. OC >>Tanon stood up. Did, did a wave, just >>Crowd because he can't say anything. And you know, I've got European approval still pending, right. You know, all sorts of stuff. But >>What we are, what we heard today from, I'll say the partner ecosystem, we talked with NetApp, we talked with pure storage. We talked with Phoenix, snap, others. I I'd have to look through my notes. Everyone's actually quite positive. Yeah. On the acquisition and what it can mean for the future of VMware. Did you hear the same? >>Yes, absolutely. And I think partially that's because the partners that we talk to are really close to the core of VMware's value proposition. That's never going to go away. So if you're talking about NetApp and AWS partnering with VMware to deliver NetApp storage services into that environment, that's core VMware proposition, it's nowhere near the bleeding edge of what, of, what, of what VMware has been doing. So they're going to be bullish. The other thing that's interesting from some of the partners that we've talked to, if you had asked us five or 10 years ago, would those partners be successful today? We might have predicted that they'd all be gone, right? NetApp what's gonna happen. Well, all storage is going to cloud. Guess what NetApp's doing? Pretty darn well with its partner, with its cloud partnerships and card and, and cloud strategy, VMware old school virtualization on premises. Ah, what are they gonna do? I'll tell you. I was skeptical when pat Gelsinger first pursued the VMC strategy with AWS. Hey, it's worked out pretty well and now they have the same capabilities everywhere. So I think that it's, it's interesting to see how solidly positioned some traditional good old fashioned blue gene technologies are how well positioned they are in this era of cloud and how VMware is such a, such a core part of that. So of course they're happy. Yeah. >>Yeah. We talked, we had AWS, NetApp and VMware on, on set for a segment and talked about, and you and I were talking about that segment before it went live. Just the power of look what AWS is doing, how you know, how, how many years ago, 10 years ago would they have been, I'm not gonna partner with NetApp and VMware and now look, it's a core to their business unit. >>Yeah, no, they wouldn't have acknowledged it. They, in fact, there was a time when AWS thought that they could maintain their stratospheric rise at the level they needed to while just letting all legacy existing stuff, just sort of fade away, you know, they'll just do it on the backs of everything new. They ran headlong into something. We call stickiness specifically around the area. VMware, they found that application environments for a variety of really good reasons belong in this context. And it's hard to rip them out by the roots. It's, you know, AWS might have told you five or 10 years ago. Well, if people don't move to cloud immediately, it's because of one reason they're stupid. The reality is there are a lot of really good reasons to maintain that VMware context. They embrace that with VMC. And now I think the it's really interesting. The NetApp announcement is another indication that the world of hyperscale cloud sees VMware as something that is part of the future. That is a very, very long tail. That very, very long tail is clearly what Broadcom is interested in. They don't see this as a flash in the pan. Let's make revenue really quickly. This is about a long ti a long time of future long future >>Long future. Well, VMware's coming off solid quarter earnings that just announced speeding estimates growing the top line by up to 6%. So there's, there's momentum that they're bringing with them into this acquisition. >>Yeah, definitely momentum big argument over what the strategy might be moving forward in terms of growth versus efficiency. I think that virtualization that includes the traditional VM with a resident full blown OS is definitely something that is behind us, but that we're carrying forward for good reason. The transition in, from a VMware perspective into the world of Zu critically important, it's critically important that they get that right as they move forward. So that net new cloud native applications could be, can be created in the VMware context that way. So it's, it's really gonna be interesting to watch over the next couple of years, the direction that this goes, but, but it's easy to get immersed in the Kool-Aid when you're at an event like this, I try to be as skeptical as possible. And I'm actually feeling pretty, I'm feeling better about VMware's future than I did before I arrived today. So that's >>Interesting. Yeah. >>Yeah, no question about it. I think, I mean, there, there, there is such a large core that I think it's gonna take it into the future a long way. >>Well, they definitely have a lot of tailwind behind them. The, the one thing that I, that we didn't get to do today was talk to any customers. We will get to do that tomorrow. When I always love hearing from the voice of the customer, we heard voice of the customer stories from the vendors, from VMware, from NetApp, from >>Little skewed, eat a little skewed. Exactly. They're all happy. All the customers are happy >>They're and very >>Successful and very successful. >>But tomorrow we get to actually rack open and talk with some VMware customers, obviously, right. Customers in the ecosystem as well. And I want to hear from them what their thoughts are on the acquisition. Yeah. >>We know they're, they're not bringing their disgruntled customers. Right. You know, this is my, this is my ex-wife's my, my ex-mother-in-law. And she's here to tell you that she didn't have a good experience. Yeah, no, that's not >>Gonna happen. We're gonna hear good stories tomorrow, but it's always nice to, to hear the stories from the customers themselves. Yeah. I always like doing that. >>No, it's always, it is informative. It's all, it's interesting from the perspective that you, you hone in on what they care about, because even if they have sort of an idea of, of, of the message that they want to get across in terms of what they're doing, still build default to that core of what they really care about. And that's interesting because what the customers really care about is part of that core. And as VMware becomes part of Broadcom, potentially, it's gonna be all about those things that are important, that you know, that customers find important. >>And that's exactly what it should be about. You know, of course we, every conversation that we had today, probably every conversation was inclusive of customer outcomes. What outcomes are you helping businesses achieve regardless of industry, especially as we're hopefully coming out of the pandemic, still in a, in a dynamic, remote hybrid work environment, but it's all about enabling businesses to, to achieve their goals. So I always wanna understand from, from VMware's perspective or AWS or NetApp procure, what are the goals that your customers are coming to you with and who are you having those conversations with? We also heard today a number of probably almost everyone that during the pandemic, the conversations are going up the stack. And maybe they've been talking with the director of it. Now it's the VP of engineering. Maybe it's the CFO. Yep. We're seeing much more strategic initiatives and focus here as customers in every industry have to pivot and have gotta get to the cloud. >>Yeah. I think that's why we work together. Well, Lisa, because you have the virtual leash and you can yank me back from diving into the technical stuff because, because I just, I, I get a pit in my stomach when someone says, oh, technology doesn't matter. It's all about outcomes. Yeah, yeah, yeah. Okay. Try doing this on technology that doesn't work. Your outcomes are gonna suck both Arely but no, no, no, they are. I know. And, and, and, and it's important that we focus on those things cuz that's what customers really care about. They do, they really care about the business outcomes >>They do. And, and on the cube, we care about those as well. And we wanna get that message across. >>I wish they would care more about speeds and feeds though. It's super interesting. It's like horsepower and torque and it's all >>He does. He gets really excited about that. But the good thing is tomorrow we have more opportunities. Yes. Got a great guest line up tomorrow. Dave and I are gonna be talking to them from right here on this set. So we encourage you to come check in for day two of our coverage of VMware Explorer live from San Francisco. We hope you have a great rest of your day and we'll see you tomorrow.

>> Announcer: 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 rapid pace of cloud adoption has changed the way organizations approach cybersecurity. Specifically, the cloud is increasingly becoming the first line of cyber defense. As such, along with communicating to the board and creating a security aware culture, the chief information security officer must ensure that the shared responsibility model is being applied properly. Meanwhile, the DevSecOps team has emerged as the critical link between strategy and execution, while audit becomes the free safety, if you will, in the equation, i.e., the last line of defense. Hello, and welcome to this week's, we keep on CUBE Insights, powered by ETR. In this "Breaking Analysis", we'll share the latest data on hyperscale, IaaS, and PaaS market performance, along with some fresh ETR survey data. And we'll share some highlights and the puts and takes from the recent AWS re:Inforce event in Boston. But first, the macro. It's earning season, and that's what many people want to talk about, including us. As we reported last week, the macro spending picture is very mixed and weird. Think back to a week ago when SNAP reported. A player like SNAP misses and the Nasdaq drops 300 points. Meanwhile, Intel, the great semiconductor hope for America misses by a mile, cuts its revenue outlook by 15% for the year, and the Nasdaq was up nearly 250 points just ahead of the close, go figure. Earnings reports from Meta, Google, Microsoft, ServiceNow, and some others underscored cautious outlooks, especially those exposed to the advertising revenue sector. But at the same time, Apple, Microsoft, and Google, were, let's say less bad than expected. And that brought a sigh of relief. And then there's Amazon, which beat on revenue, it beat on cloud revenue, and it gave positive guidance. The Nasdaq has seen this month best month since the isolation economy, which "Breaking Analysis" contributor, Chip Symington, attributes to what he calls an oversold rally. But there are many unknowns that remain. How bad will inflation be? Will the fed really stop tightening after September? The Senate just approved a big spending bill along with corporate tax hikes, which generally don't favor the economy. And on Monday, August 1st, the market will likely realize that we are in the summer quarter, and there's some work to be done. Which is why it's not surprising that investors sold the Nasdaq at the close today on Friday. Are people ready to call the bottom? Hmm, some maybe, but there's still lots of uncertainty. However, the cloud continues its march, despite some very slight deceleration in growth rates from the two leaders. Here's an update of our big four IaaS quarterly revenue data. The big four hyperscalers will account for $165 billion in revenue this year, slightly lower than what we had last quarter. We expect AWS to surpass 83 billion this year in revenue. Azure will be more than 2/3rds the size of AWS, a milestone from Microsoft. Both AWS and Azure came in slightly below our expectations, but still very solid growth at 33% and 46% respectively. GCP, Google Cloud Platform is the big concern. By our estimates GCP's growth rate decelerated from 47% in Q1, and was 38% this past quarter. The company is struggling to keep up with the two giants. Remember, both GCP and Azure, they play a shell game and hide the ball on their IaaS numbers, so we have to use a survey data and other means of estimating. But this is how we see the market shaping up in 2022. Now, before we leave the overall cloud discussion, here's some ETR data that shows the net score or spending momentum granularity for each of the hyperscalers. These bars show the breakdown for each company, with net score on the right and in parenthesis, net score from last quarter. lime green is new adoptions, forest green is spending up 6% or more, the gray is flat, pink is spending at 6% down or worse, and the bright red is replacement or churn. Subtract the reds from the greens and you get net score. One note is this is for each company's overall portfolio. So it's not just cloud. So it's a bit of a mixed bag, but there are a couple points worth noting. First, anything above 40% or 40, here as shown in the chart, is considered elevated. AWS, as you can see, is well above that 40% mark, as is Microsoft. And if you isolate Microsoft's Azure, only Azure, it jumps above AWS's momentum. Google is just barely hanging on to that 40 line, and Alibaba is well below, with both Google and Alibaba showing much higher replacements, that bright red. But here's the key point. AWS and Azure have virtually no churn, no replacements in that bright red. And all four companies are experiencing single-digit numbers in terms of decreased spending within customer accounts. People may be moving some workloads back on-prem selectively, but repatriation is definitely not a trend to bet the house on, in our view. Okay, let's get to the main subject of this "Breaking Analysis". TheCube was at AWS re:Inforce in Boston this week, and we have some observations to share. First, we had keynotes from Steven Schmidt who used to be the chief information security officer at Amazon on Web Services, now he's the CSO, the chief security officer of Amazon. Overall, he dropped the I in his title. CJ Moses is the CISO for AWS. Kurt Kufeld of AWS also spoke, as did Lena Smart, who's the MongoDB CISO, and she keynoted and also came on theCUBE. We'll go back to her in a moment. The key point Schmidt made, one of them anyway, was that Amazon sees more data points in a day than most organizations see in a lifetime. Actually, it adds up to quadrillions over a fairly short period of time, I think, it was within a month. That's quadrillion, it's 15 zeros, by the way. Now, there was drill down focus on data protection and privacy, governance, risk, and compliance, GRC, identity, big, big topic, both within AWS and the ecosystem, network security, and threat detection. Those are the five really highlighted areas. Re:Inforce is really about bringing a lot of best practice guidance to security practitioners, like how to get the most out of AWS tooling. Schmidt had a very strong statement saying, he said, "I can assure you with a 100% certainty that single controls and binary states will absolutely positively fail." Hence, the importance of course, of layered security. We heard a little bit of chat about getting ready for the future and skating to the security puck where quantum computing threatens to hack all of the existing cryptographic algorithms, and how AWS is trying to get in front of all that, and a new set of algorithms came out, AWS is testing. And, you know, we'll talk about that maybe in the future, but that's a ways off. And by its prominent presence, the ecosystem was there enforced, to talk about their role and filling the gaps and picking up where AWS leaves off. We heard a little bit about ransomware defense, but surprisingly, at least in the keynotes, no discussion about air gaps, which we've talked about in previous "Breaking Analysis", is a key factor. We heard a lot about services to help with threat detection and container security and DevOps, et cetera, but there really wasn't a lot of specific talk about how AWS is simplifying the life of the CISO. Now, maybe it's inherently assumed as AWS did a good job stressing that security is job number one, very credible and believable in that front. But you have to wonder if the world is getting simpler or more complex with cloud. And, you know, you might say, "Well, Dave, come on, of course it's better with cloud." But look, attacks are up, the threat surface is expanding, and new exfiltration records are being set every day. I think the hard truth is, the cloud is driving businesses forward and accelerating digital, and those businesses are now exposed more than ever. And that's why security has become such an important topic to boards and throughout the entire organization. Now, the other epiphany that we had at re:Inforce is that there are new layers and a new trust framework emerging in cyber. Roles are shifting, and as a direct result of the cloud, things are changing within organizations. And this first hit me in a conversation with long-time cyber practitioner and Wikibon colleague from our early Wikibon days, and friend, Mike Versace. And I spent two days testing the premise that Michael and I talked about. And here's an attempt to put that conversation into a graphic. The cloud is now the first line of defense. AWS specifically, but hyperscalers generally provide the services, the talent, the best practices, and automation tools to secure infrastructure and their physical data centers. And they're really good at it. The security inside of hyperscaler clouds is best of breed, it's world class. And that first line of defense does take some of the responsibility off of CISOs, but they have to understand and apply the shared responsibility model, where the cloud provider leaves it to the customer, of course, to make sure that the infrastructure they're deploying is properly configured. So in addition to creating a cyber aware culture and communicating up to the board, the CISO has to ensure compliance with and adherence to the model. That includes attracting and retaining the talent necessary to succeed. Now, on the subject of building a security culture, listen to this clip on one of the techniques that Lena Smart, remember, she's the CISO of MongoDB, one of the techniques she uses to foster awareness and build security cultures in her organization. Play the clip >> Having the Security Champion program, so that's just, it's like one of my babies. That and helping underrepresented groups in MongoDB kind of get on in the tech world are both really important to me. And so the Security Champion program is purely purely voluntary. We have over 100 members. And these are people, there's no bar to join, you don't have to be technical. If you're an executive assistant who wants to learn more about security, like my assistant does, you're more than welcome. Up to, we actually, people grade themselves when they join us. We give them a little tick box, like five is, I walk on security water, one is I can spell security, but I'd like to learn more. Mixing those groups together has been game-changing for us. >> Now, the next layer is really where it gets interesting. DevSecOps, you know, we hear about it all the time, shifting left. It implies designing security into the code at the dev level. Shift left and shield right is the kind of buzz phrase. But it's getting more and more complicated. So there are layers within the development cycle, i.e., securing the container. So the app code can't be threatened by backdoors or weaknesses in the containers. Then, securing the runtime to make sure the code is maintained and compliant. Then, the DevOps platform so that change management doesn't create gaps and exposures, and screw things up. And this is just for the application security side of the equation. What about the network and implementing zero trust principles, and securing endpoints, and machine to machine, and human to app communication? So there's a lot of burden being placed on the DevOps team, and they have to partner with the SecOps team to succeed. Those guys are not security experts. And finally, there's audit, which is the last line of defense or what I called at the open, the free safety, for you football fans. They have to do more than just tick the box for the board. That doesn't cut it anymore. They really have to know their stuff and make sure that what they sign off on is real. And then you throw ESG into the mix is becoming more important, making sure the supply chain is green and also secure. So you can see, while much of this stuff has been around for a long, long time, the cloud is accelerating innovation in the pace of delivery. And so much is changing as a result. Now, next, I want to share a graphic that we shared last week, but a little different twist. It's an XY graphic with net score or spending velocity in the vertical axis and overlap or presence in the dataset on the horizontal. With that magic 40% red line as shown. Okay, I won't dig into the data and draw conclusions 'cause we did that last week, but two points I want to make. First, look at Microsoft in the upper-right hand corner. They are big in security and they're attracting a lot of dollars in the space. We've reported on this for a while. They're a five-star security company. And every time, from a spending standpoint in ETR data, that little methodology we use, every time I've run this chart, I've wondered, where the heck is AWS? Why aren't they showing up there? If security is so important to AWS, which it is, and its customers, why aren't they spending money with Amazon on security? And I asked this very question to Merrit Baer, who resides in the office of the CISO at AWS. Listen to her answer. >> It doesn't mean don't spend on security. There is a lot of goodness that we have to offer in ESS, external security services. But I think one of the unique parts of AWS is that we don't believe that security is something you should buy, it's something that you get from us. It's something that we do for you a lot of the time. I mean, this is the definition of the shared responsibility model, right? >> Now, maybe that's good messaging to the market. Merritt, you know, didn't say it outright, but essentially, Microsoft they charge for security. At AWS, it comes with the package. But it does answer my question. And, of course, the fact is that AWS can subsidize all this with egress charges. Now, on the flip side of that, (chuckles) you got Microsoft, you know, they're both, they're competing now. We can take CrowdStrike for instance. Microsoft and CrowdStrike, they compete with each other head to head. So it's an interesting dynamic within the ecosystem. Okay, but I want to turn to a powerful example of how AWS designs in security. And that is the idea of confidential computing. Of course, AWS is not the only one, but we're coming off of re:Inforce, and I really want to dig into something that David Floyer and I have talked about in previous episodes. And we had an opportunity to sit down with Arvind Raghu and J.D. Bean, two security experts from AWS, to talk about this subject. And let's share what we learned and why we think it matters. First, what is confidential computing? That's what this slide is designed to convey. To AWS, they would describe it this way. It's the use of special hardware and the associated firmware that protects customer code and data from any unauthorized access while the data is in use, i.e., while it's being processed. That's oftentimes a security gap. And there are two dimensions here. One is protecting the data and the code from operators on the cloud provider, i.e, in this case, AWS, and protecting the data and code from the customers themselves. In other words, from admin level users are possible malicious actors on the customer side where the code and data is being processed. And there are three capabilities that enable this. First, the AWS Nitro System, which is the foundation for virtualization. The second is Nitro Enclaves, which isolate environments, and then third, the Nitro Trusted Platform Module, TPM, which enables cryptographic assurances of the integrity of the Nitro instances. Now, we've talked about Nitro in the past, and we think it's a revolutionary innovation, so let's dig into that a bit. This is an AWS slide that was shared about how they protect and isolate data and code. On the left-hand side is a classical view of a virtualized architecture. You have a single host or a single server, and those white boxes represent processes on the main board, X86, or could be Intel, or AMD, or alternative architectures. And you have the hypervisor at the bottom which translates instructions to the CPU, allowing direct execution from a virtual machine into the CPU. But notice, you also have blocks for networking, and storage, and security. And the hypervisor emulates or translates IOS between the physical resources and the virtual machines. And it creates some overhead. Now, companies like VMware have done a great job, and others, of stripping out some of that overhead, but there's still an overhead there. That's why people still like to run on bare metal. Now, and while it's not shown in the graphic, there's an operating system in there somewhere, which is privileged, so it's got access to these resources, and it provides the services to the VMs. Now, on the right-hand side, you have the Nitro system. And you can see immediately the differences between the left and right, because the networking, the storage, and the security, the management, et cetera, they've been separated from the hypervisor and that main board, which has the Intel, AMD, throw in Graviton and Trainium, you know, whatever XPUs are in use in the cloud. And you can see that orange Nitro hypervisor. That is a purpose-built lightweight component for this system. And all the other functions are separated in isolated domains. So very strong isolation between the cloud software and the physical hardware running workloads, i.e., those white boxes on the main board. Now, this will run at practically bare metal speeds, and there are other benefits as well. One of the biggest is security. As we've previously reported, this came out of AWS's acquisition of Annapurna Labs, which we've estimated was picked up for a measly $350 million, which is a drop in the bucket for AWS to get such a strategic asset. And there are three enablers on this side. One is the Nitro cards, which are accelerators to offload that wasted work that's done in traditional architectures by typically the X86. We've estimated 25% to 30% of core capacity and cycles is wasted on those offloads. The second is the Nitro security chip, which is embedded and extends the root of trust to the main board hardware. And finally, the Nitro hypervisor, which allocates memory and CPU resources. So the Nitro cards communicate directly with the VMs without the hypervisors getting in the way, and they're not in the path. And all that data is encrypted while it's in motion, and of course, encryption at rest has been around for a while. We asked AWS, is this an, we presumed it was an Arm-based architecture. We wanted to confirm that. Or is it some other type of maybe hybrid using X86 and Arm? They told us the following, and quote, "The SoC, system on chips, for these hardware components are purpose-built and custom designed in-house by Amazon and Annapurna Labs. The same group responsible for other silicon innovations such as Graviton, Inferentia, Trainium, and AQUA. Now, the Nitro cards are Arm-based and do not use any X86 or X86/64 bit CPUs. Okay, so it confirms what we thought. So you may say, "Why should we even care about all this technical mumbo jumbo, Dave?" Well, a year ago, David Floyer and I published this piece explaining why Nitro and Graviton are secret weapons of Amazon that have been a decade in the making, and why everybody needs some type of Nitro to compete in the future. This is enabled, this Nitro innovations and the custom silicon enabled by the Annapurna acquisition. And AWS has the volume economics to make custom silicon. Not everybody can do it. And it's leveraging the Arm ecosystem, the standard software, and the fabrication volume, the manufacturing volume to revolutionize enterprise computing. Nitro, with the alternative processor, architectures like Graviton and others, enables AWS to be on a performance, cost, and power consumption curve that blows away anything we've ever seen from Intel. And Intel's disastrous earnings results that we saw this past week are a symptom of this mega trend that we've been talking about for years. In the same way that Intel and X86 destroyed the market for RISC chips, thanks to PC volumes, Arm is blowing away X86 with volume economics that cannot be matched by Intel. Thanks to, of course, to mobile and edge. Our prediction is that these innovations and the Arm ecosystem are migrating and will migrate further into enterprise computing, which is Intel's stronghold. Now, that stronghold is getting eaten away by the likes of AMD, Nvidia, and of course, Arm in the form of Graviton and other Arm-based alternatives. Apple, Tesla, Amazon, Google, Microsoft, Alibaba, and others are all designing custom silicon, and doing so much faster than Intel can go from design to tape out, roughly cutting that time in half. And the premise of this piece is that every company needs a Nitro to enable alternatives to the X86 in order to support emergent workloads that are data rich and AI-based, and to compete from an economic standpoint. So while at re:Inforce, we heard that the impetus for Nitro was security. Of course, the Arm ecosystem, and its ascendancy has enabled, in our view, AWS to create a platform that will set the enterprise computing market this decade and beyond. Okay, that's it for today. Thanks to Alex Morrison, who is on production. And he does the podcast. And Ken Schiffman, our newest member of our Boston Studio team is also on production. Kristen Martin and Cheryl Knight help spread the word on social media and in the community. And Rob Hof is our editor in chief over at SiliconANGLE. He does some great, great work for us. Remember, all these episodes are available as podcast. Wherever you listen, just search "Breaking Analysis" podcast. I publish each week on wikibon.com and siliconangle.com. Or you can email me directly at David.Vellante@siliconangle.com or DM me @dvellante, comment on my LinkedIn post. And please do check out etr.ai for the best survey data in the enterprise tech business. This is Dave Vellante for theCUBE Insights, powered by ETR. Thanks for watching. Be well, and we'll see you next time on "Breaking Analysis." (upbeat theme music)

>> From theCUBE Studios in Palo Alto and Boston bringing you data driven insights from theCUBE and ETR. This is Breaking Analysis with Dave Vellante. >> After a two year hiatus, AWS re:Inforce is back on as an in-person event in Boston next week. Like the All-Star break in baseball, re:Inforce gives us an opportunity to evaluate the cyber security market overall, the state of cloud security and cross cloud security and more specifically what AWS is up to in the sector. Welcome to this week's Wikibon cube insights powered by ETR. In this Breaking Analysis we'll share our view of what's changed since our last cyber update in May. We'll look at the macro environment, how it's impacting cyber security plays in the market, what the ETR data tells us and what to expect at next week's AWS re:Inforce. We start this week with a checkpoint from Breaking Analysis contributor and stock trader Chip Simonton. We asked for his assessment of the market generally in cyber stocks specifically. So we'll summarize right here. We've kind of moved on from a narrative of the sky is falling to one where the glass is half empty you know, and before today's big selloff it was looking more and more like glass half full. The SNAP miss has dragged down many of the big names that comprise the major indices. You know, earning season as always brings heightened interest and this time we're seeing many cross currents. It starts as usual with the banks and the money centers. With the exception of JP Morgan the numbers were pretty good according to Simonton. Investment banks were not so great with Morgan and Goldman missing estimates but in general, pretty positive outlooks. But the market also shrugged off IBM's growth. And of course, social media because of SNAP is getting hammered today. The question is no longer recession or not but rather how deep the recession will be. And today's PMI data was the weakest since the start of the pandemic. Bond yields continue to weaken and there's a growing consensus that Fed tightening may be over after September as commodity prices weaken. Now gas prices of course are still high but they've come down. Tesla, Nokia and AT&T all indicated that supply issues were getting better which is also going to help with inflation. So it's no shock that the NASDAQ has done pretty well as beaten down as tech stocks started to look oversold you know, despite today's sell off. But AT&T and Verizon, they blamed their misses in part on people not paying their bills on time. SNAP's huge miss even after guiding lower and then refusing to offer future guidance took that stock down nearly 40% today and other social media stocks are off on sympathy. Meta and Google were off, you know, over 7% at midday. I think at one point hit 14% down and Google, Meta and Twitter have all said they're freezing new hires. So we're starting to see according to Simonton for the first time in a long time, the lower income, younger generation really feeling the pinch of inflation. Along of course with struggling families that have to choose food and shelter over discretionary spend. Now back to the NASDAQ for a moment. As we've been reporting back in mid-June and NASDAQ was off nearly 33% year to date and has since rallied. It's now down about 25% year to date as of midday today. But as I say, it had been, you know much deeper back in early June. But it's broken that downward trend that we talked about where the highs are actually lower and the lows are lower. That's started to change for now anyway. We'll see if it holds. But chip stocks, software stocks, and of course the cyber names have broken those down trends and have been trading above their 50 day moving averages for the first time in around four months. And again, according to Simonton, we'll see if that holds. If it does, that's a positive sign. Now remember on June 24th, we recorded a Breaking Analysis and talked about Qualcomm trading at a 12 X multiple with an implied 15% growth rate. On that day the stock was 124 and it surpassed 155 earlier this month. That was a really good call by Simonton. So looking at some of the cyber players here SailPoint is of course the anomaly with the Thoma Bravo 7 billion acquisition of the company holding that stock up. But the Bug ETF of basket of cyber stocks has definitely improved. When we last reported on cyber in May, CrowdStrike was off 23% year to date. It's now off 4%. Palo Alto has held steadily. Okta is still underperforming its peers as it works through the fallout from the breach and the ingestion of its Auth0 acquisition. Meanwhile, Zscaler and SentinelOne, those high flyers are still well off year to date, with Ping Identity and CyberArk not getting hit as hard as their valuations hadn't run up as much. But virtually all these tech stocks generally in cyber issues specifically, they've been breaking their down trend. So it will now come down to earnings guidance in the coming months. But the SNAP reaction is quite stunning. I mean, the environment is slowing, we know that. Ad spending gets cut in that type of market, we know that too. So it shouldn't be a huge surprise to anyone but as Chip Simonton says, this shows that sellers are still in control here. So it's going to take a little while to work through that despite the positive signs that we're seeing. Okay. We also turned to our friend Eric Bradley from ETR who follows these markets quite closely. He frequently interviews CISOs on his program, on his round tables. So we asked to get his take and here's what ETR is saying. Again, as we've reported while CIOs and IT buyers have tempered spending expectations since December and early January when they called for an 8% plus spending growth, they're still expecting a six to seven percent uptick in spend this year. So that's pretty good. Security remains the number one priority and also is the highest ranked sector in the ETR data set when you measure in terms of pervasiveness in the study. Within security endpoint detection and extended detection and response along with identity and privileged account management are the sub-sectors with the most spending velocity. And when you exclude Microsoft which is just dominant across the board in so many sectors, CrowdStrike has taken over the number one spot in terms of spending momentum in ETR surveys with CyberArk and Tanium showing very strong as well. Okta has seen a big dropoff in net score from 54% last survey to 45% in July as customers maybe put a pause on new Okta adoptions. That clearly shows in the survey. We'll talk about that in a moment. Look Okta still elevated in terms of spending momentum, but it doesn't have the dominant leadership position it once held in spend velocity. Year on year, according to ETR, Tenable and Elastic are seeing the biggest jumps in spending momentum, with SailPoint, Tanium, Veronis, CrowdStrike and Zscaler seeing the biggest jump in new adoptions since the last survey. Now on the downside, SonicWall, Symantec, Trellic which is McAfee, Barracuda and TrendMicro are seeing the highest percentage of defections and replacements. Let's take a deeper look at what the ETR data tells us about the cybersecurity space. This is a popular view that we like to share with net score or spending momentum on the Y axis and overlap or pervasiveness in the data on the X axis. It's a measure of presence in the data set we used to call it market share. With the data, the dot positions, you see that little inserted table, that's how the dots are plotted. And it's important to note that this data is filtered for firms with at least 100 Ns in the survey. That's why some of the other ones that we mentioned might have dropped off. The red dotted line at 40% that indicates highly elevated spending momentum and there are several firms above that mark including of course, Microsoft, which is literally off the charts in both dimensions in the upper right. It's quite incredible actually. But for the rest of the pack, CrowdStrike has now taken back its number one net score position in the ETR survey. And CyberArk and Okta and Zscaler, CloudFlare and Auth0 now Okta through the acquisition, are all above the 40% mark. You can stare at the data at your leisure but I'll just point out, make three quick points. First Palo Alto continues to impress and as steady as she goes. Two, it's a very crowded market still and it's complicated space. And three there's lots of spending in different pockets. This market has too many tools and will continue to consolidate. Now I'd like to drill into a couple of firms net scores and pick out some of the pure plays that are leading the way. This series of charts shows the net score or spending velocity or granularity for Okta, CrowdStrike, Zscaler and CyberArk. Four of the top pure plays in the ETR survey that also have over a hundred responses. Now the colors represent the following. Bright red is defections. We're leaving the platform. The pink is we're spending less, meaning we're spending 6% or worse. The gray is flat spend plus or minus 5%. The forest green is spending more, i.e, 6% or more and the lime green is we're adding the platform new. That red dotted line at the 40% net score mark is the same elevated level that we like to talk about. All four are above that target. Now that blue line you see there is net score. The yellow line is pervasiveness in the data. The data shown in each bar goes back 10 surveys all the way back to January 2020. First I want to call out that all four again are seeing down trends in spending momentum with the whole market. That's that blue line. They're seeing that this quarter, again, the market is off overall. Everybody is kind of seeing that down trend for the most part. Very few exceptions. Okta is being hurt by fewer new additions which is why we highlighted in red, that red dotted area, that square that we put there in the upper right of that Okta bar. That lime green, new ads are off as well. And the gray for Okta, flat spending is noticeably up. So it feels like people are pausing a bit and taking a breather for Okta. And as we said earlier, perhaps with the breach earlier this year and the ingestion of Auth0 acquisition the company is seeing some friction in its business. Now, having said that, you can see Okta's yellow line or presence in the data set, continues to grow. So it's a good proxy from market presence. So Okta remains a leader in identity. So again, I'll let you stare at the data if you want at your leisure, but despite some concerns on declining momentum, notice this very little red at these companies when it comes to the ETR survey data. Now one more data slide which brings us to our four star cyber firms. We started a tradition a few years ago where we sorted the ETR data by net score. That's the left hand side of this graphic. And we sorted by shared end or presence in the data set. That's the right hand side. And again, we filtered by companies with at least 100 N and oh, by the way we've excluded Microsoft just to level the playing field. The red dotted line signifies the top 10. If a company cracks the top 10 in both spending momentum and presence, we give them four stars. So Palo Alto, CrowdStrike, Okta, Fortinet and Zscaler all made the cut this time. Now, as we pointed out in May if you combined Auth0 with Okta, they jumped to the number two on the right hand chart in terms of presence. And they would lead the pure plays there although it would bring down Okta's net score somewhat, as you can see, Auth0's net score is lower than Okta's. So when you combine them it would drag that down a little bit but it would give them bigger presence in the data set. Now, the other point we'll make is that Proofpoint and Splunk both dropped off the four star list this time as they both saw marked declines in net score or spending velocity. They both got four stars last quarter. Okay. We're going to close on what to expect at re:Inforce this coming week. Re:Inforce, if you don't know, is AWS's security event. They first held it in Boston back in 2019. It's dedicated to cloud security. The past two years has been virtual and they announced that reinvent that it would take place in Houston in June, which everybody said, that's crazy. Who wants to go to Houston in June and turns out nobody did so they postponed the event, thankfully. And so now they're back in Boston, starting on Monday. Not that it's going to be much cooler in Boston. Anyway, Steven Schmidt had been the face of AWS security at all these previous events as the Chief Information Security Officer. Now he's dropped the I from his title and is now the Chief Security Officer at Amazon. So he went with Jesse to the mothership. Presumably he dropped the I because he deals with physical security now too, like at the warehouses. Not that he didn't have to worry about physical security at the AWS data centers. I don't know. Anyway, he and CJ Moses who is now the new CISO at AWS will be keynoting along with some others including MongoDB's Chief Information Security Officer. So that should be interesting. Now, if you've been following AWS you'll know they like to break things down into, you know, a couple of security categories. Identity, detection and response, data protection slash privacy slash GRC which is governance, risk and compliance, and we would expect a lot more talk this year on container security. So you're going to hear also product updates and they like to talk about how they're adding value to services and try to help, they try to help customers understand how to apply services. Things like GuardDuty, which is their threat detection that has machine learning in it. They'll talk about Security Hub, which centralizes views and alerts and automates security checks. They have a service called Detective which does root cause analysis, and they have tools to mitigate denial of service attacks. And they'll talk about security in Nitro which isolates a lot of the hardware resources. This whole idea of, you know, confidential computing which is, you know, AWS will point out it's kind of become a buzzword. They take it really seriously. I think others do as well, like Arm. We've talked about that on previous Breaking Analysis. And again, you're going to hear something on container security because it's the hottest thing going right now and because AWS really still serves developers and really that's what they're trying to do. They're trying to enable developers to design security in but you're also going to hear a lot of best practice advice from AWS i.e, they'll share the AWS dogfooding playbooks with you for their own security practices. AWS like all good security practitioners, understand that the keys to a successful security strategy and implementation don't start with the technology, rather they're about the methods and practices that you apply to solve security threats and a top to bottom cultural approach to security awareness, designing security into systems, that's really where the developers come in, and training for continuous improvements. So you're going to get heavy doses of really strong best practices and guidance and you know, some good preaching. You're also going to hear and see a lot of partners. They'll be very visible at re:Inforce. AWS is all about ecosystem enablement and AWS is going to host close to a hundred security partners at the event. This is key because AWS doesn't do it all. Interestingly, they don't even show up in the ETR security taxonomy, right? They just sort of imply that it's built in there even though they have a lot of security tooling. So they have to apply the shared responsibility model not only with customers but partners as well. They need an ecosystem to fill gaps and provide deeper problem solving with more mature and deeper security tooling. And you're going to hear a lot of positivity around how great cloud security is and how it can be done well. But the truth is this stuff is still incredibly complicated and challenging for CISOs and practitioners who are understaffed when it comes to top talent. Now, finally, theCUBE will be at re:Inforce in force. John Furry and I will be hosting two days of broadcast so please do stop by if you're in Boston and say hello. We'll have a little chat, we'll share some data and we'll share our overall impressions of the event, the market, what we're seeing, what we're learning, what we're worried about in this dynamic space. Okay. That's it for today. Thanks for watching. Thanks to Alex Myerson, who is on production and manages the podcast. Kristin Martin and Cheryl Knight, they helped get the word out on social and in our newsletters and Rob Hoff is our Editor in Chief over at siliconangle.com. You did some great editing. Thank you all. Remember all these episodes they're available, this podcast. Wherever you listen, all you do is search Breaking Analysis podcast. I publish each week on wikibon.com and siliconangle.com. You can get in touch with me by emailing avid.vellante@siliconangle.com or DM me @dvellante, or comment on my LinkedIn post and please do check out etr.ai for the best survey data in the enterprise tech business. This is Dave Vellante for theCUBE Insights powered by ETR. Thanks for watching and we'll see you in Boston next week if you're there or next time on Breaking Analysis (soft music)

>>From the cube studios in Palo Alto, in Boston, bringing you data driven insights from the cube and ETR. This is breaking analysis with Dave ante. >>When Frank sluman took service, now public many people undervalued the company, positioning it as just a better help desk tool. You know, it turns out that the firm actually had a massive Tam expansion opportunity in it. SM customer service, HR, logistics, security marketing, and service management. Generally now stock price followed over the years, the stellar execution under Slootman and CFO, Mike scar Kelly's leadership. Now, when they took the reins at snowflake expectations were already set that they'd repeat the feet, but this time, if anything, the company was overvalued out of the gate, the thing is people didn't really better understand the market opportunity this time around, other than that, it was a bet on Salman's track record of execution and on data, pretty good bets, but folks really didn't appreciate that snowflake. Wasn't just a better data warehouse that it was building what they call a data cloud, and we've turned a data super cloud. >>Hello and welcome to this. Week's Wikibon cube insights powered by ETR in this breaking analysis, we'll do four things. First. We're gonna review the recent narrative and concerns about snowflake and its value. Second, we're gonna share survey data from ETR that will confirm precisely what the company's CFO has been telling anyone who will listen. And third, we're gonna share our view of what snowflake is building IE, trying to become the defacto standard data platform, and four convey our expectations for the upcoming snowflake summit. Next week at Caesar's palace in Las Vegas, Snowflake's most recent quarterly results they've been well covered and well documented. It basically hit its targets, which for snowflake investors was bad news wall street piled on expressing concerns about Snowflake's consumption, pricing model, slowing growth rates, lack of profitability and valuation. Given the, given the current macro market conditions, the stock dropped below its IPO offering price, which you couldn't touch on day one, by the way, as the stock opened well above that and, and certainly closed well above that price of one 20 and folks express concerns about some pretty massive insider selling throughout 2021 and early 2022, all this caused the stock price to drop quite substantially. >>And today it's down around 63% or more year to date, but the only real substantive change in the company's business is that some of its largest consumer facing companies, while still growing dialed back, their consumption this past quarter, the tone of the call was I wouldn't say contentious the earnings call, but Scarelli, I think was getting somewhat annoyed with the implication from some analyst questions that something is fundamentally wrong with Snowflake's business. So let's unpack this a bit first. I wanna talk about the consumption pricing on the earnings call. One of the analysts asked if snowflake would consider more of a subscription based model so that they could better weather such fluctuations and demand before the analyst could even finish the question, CFO Scarelli emphatically interrupted and said, no, <laugh> the analyst might as well have asked, Hey Mike, have you ever considered changing your pricing model and screwing your customers the same way most legacy SaaS companies lock their customers in? >>So you could squeeze more revenue out of them and make my forecasting life a little bit easier. <laugh> consumption pricing is one of the things that makes a company like snowflake so attractive because customers is especially large customers facing fluctuating demand can dial and their end demand can dial down usage for certain workloads that are maybe not yet revenue producing or critical. Now let's jump to insider trading. There were a lot of insider selling going on last year and into 2022 now, I mean a lot sloop and Scarelli Christine Kleinman. Mike SP several board members. They sold stock worth, you know, many, many hundreds of millions of dollars or, or more at prices in the two hundreds and three hundreds and even four hundreds. You remember the company at one point was valued at a hundred billion dollars, surpassing the value of service now, which is this stupid at this point in the company's tenure and the insider's cost basis was very often in the single digit. >>So on the one hand, I can't blame them. You know what a gift the market gave them last year. Now also famed investor, Peter Linsey famously said, insiders sell for many reasons, but they only buy for one. But I have to say there wasn't a lot of insider buying of the stock when it was in the three hundreds and above. And so yeah, this pattern is something to watch our insiders buying. Now, I'm not sure we'll keep watching snowflake. It's pretty generous with stock based compensation and insiders still own plenty of stock. So, you know, maybe not, but we'll see in future disclosures, but the bottom line is Snowflake's business. Hasn't dramatically changed with the exception of these large consumer facing companies. Now, another analyst pointed out that companies like snap, he pointed to company snap, Peloton, Netflix, and face Facebook have been cutting back. >>And Scarelli said, and what was a bit of a surprise to me? Well, I'm not gonna name the customers, but it's not the ones you mentioned. So I, I thought I would've, you know, if I were the analyst I would've follow up with, how about Walmart target visa, Amex, Expedia price line, or Uber? Any of those Mike? I, I doubt he would've answered me anything. Anyway, the one thing that Scarelli did do is update Snowflake's fiscal year 2029 outlook to emphasize the long term opportunity that the company sees. This chart shows a financial snapshot of Snowflake's current business using a combination of quarterly and full year numbers in a model of what the business will look like. According to Scarelli in Dave ante with a little bit of judgment in 2029. So this is essentially based on the company's framework. Snowflake this year will surpass 2 billion in revenues and targeting 10 billion by 2029. >>Its current growth rate is 84% and its target is 30% in the out years, which is pretty impressive. Gross margins are gonna tick up a bit, but remember Snowflake's cost a good sold they're dominated by its cloud cost. So it's got a governor. There has to pay AWS Azure and Google for its infrastructure. But high seventies is a, is a good target. It's not like the historical Microsoft, you know, 80, 90% gross margin. Not that Microsoft is there anymore, but, but snowflake, you know, was gonna be limited by how far it can, how much it can push gross margin because of that factor. It's got a tiny operating margin today and it's targeting 20% in 2029. So that would be 2 billion. And you would certainly expect it's operating leverage in the out years to enable much, much, much lower SGNA than the current 54%. I'm guessing R and D's gonna stay healthy, you know, coming in at 15% or so. >>But the real interesting number to watch is free cash flow, 16% this year for the full fiscal year growing to 25% by 2029. So 2.5 billion in free cash flow in the out years, which I believe is up from previous Scarelli forecast in that 10, you know, out year view 2029 view and expect the net revenue retention, the NRR, it's gonna moderate. It's gonna come down, but it's still gonna be well over a hundred percent. We pegged it at 130% based on some of Mike's guidance. Now today, snowflake and every other stock is well off this morning. The company had a 40 billion value would drop well below that midday, but let's stick with the 40 billion on this, this sad Friday on the stock market, we'll go to 40 billion and who knows what the stock is gonna be valued in 2029? No idea, but let's say between 40 and 200 billion and look, it could get even ugly in the market as interest rates rise. >>And if inflation stays high, you know, until we get a Paul Voker like action, which is gonna be painful from the fed share, you know, let's hope we don't have a repeat of the long drawn out 1970s stagflation, but that is a concern among investors. We're gonna try to keep it positive here and we'll do a little sensitivity analysis of snowflake based on Scarelli and Ante's 2029 projections. What we've done here is we've calculated in this chart. Today's current valuation at about 40 billion and run a CAGR through 2029 with our estimates of valuation at that time. So if it stays at 40 billion valuation, can you imagine snowflake grow into a 10 billion company with no increase in valuation by the end, by by 2029 fiscal 2029, that would be a major bummer and investors would get a, a 0% return at 50 billion, 4% Kager 60 billion, 7%. >>Kegar now 7% market return is historically not bad relative to say the S and P 500, but with that kind of revenue and profitability growth projected by snowflake combined with inflation, that would again be a, a kind of a buzzkill for investors. The picture at 75 billion valuation, isn't much brighter, but it picks up at, at a hundred billion, even with inflation that should outperform the market. And as you get to 200 billion, which would track by the way, revenue growth, you get a 30% plus return, which would be pretty good. Could snowflake beat these projections. Absolutely. Could the market perform at the optimistic end of the spectrum? Sure. It could. It could outperform these levels. Could it not perform at these levels? You bet, but hopefully this gives a little context and framework to what Scarelli was talking about and his framework, not with notwithstanding the market's unpredictability you're you're on your own. >>There. I can't help snowflake looks like it's going to continue either way in amazing run compared to other software companies historically, and whether that's reflected in the stock price. Again, I, I, I can't predict, okay. Let's look at some ETR survey data, which aligns really well with what snowflake is telling the street. This chart shows the breakdown of Snowflake's net score and net score. Remember is ETS proprietary methodology that measures the percent of customers in their survey that are adding the platform new. That's the lime green at 19% existing snowflake customers that are ex spending 6% or more on the platform relative to last year. That's the forest green that's 55%. That's a big number flat spend. That's the gray at 21% decreasing spending. That's the pinkish at 5% and churning that's the red only 1% or, or moving off the platform, tiny, tiny churn, subtract the red from the greens and you get a net score that, that, that nets out to 68%. >>That's an, a very impressive net score by ETR standards. But it's down from the highs of the seventies and mid eighties, where high seventies and mid eighties, where snowflake has been since January of 2019 note that this survey of 1500 or so organizations includes 155 snowflake customers. What was really interesting is when we cut the data by industry sector, two of Snowflake's most important verticals, our finance and healthcare, both of those sectors are holding a net score in the ETR survey at its historic range. 83%. Hasn't really moved off that, you know, 80% plus number really encouraging, but retail consumer showed a dramatic decline. This past survey from 73% in the previous quarter down to 54%, 54% in just three months time. So this data aligns almost perfectly with what CFO Scarelli has been telling the street. So I give a lot of credibility to that narrative. >>Now here's a time series chart for the net score and the provision in the data set, meaning how penetrated snowflake is in the survey. Again, net score measures, spending velocity and a specific platform and provision measures the presence in the data set. You can see the steep downward trend in net score this past quarter. Now for context note, the red dotted line on the vertical axis at 40%, that's a bit of a magic number. Anything above that is best in class in our view, snowflake still a well, well above that line, but the April survey as we reported on May 7th in quite a bit of detail shows a meaningful break in the snowflake trend as shown by ETRS call out on the bottom line. You can see a steady rise in the survey, which is a proxy for Snowflake's overall market penetration. So steadily moving up and up. >>Here's a bit of a different view on that data bringing in some of Snowflake's peers and other data platforms. This XY graph shows net score on the vertical axis and provision on the horizontal with the red dotted line. At 40%, you can see from the ETR callouts again, that snowflake while declining in net score still holds the highest net score in the survey. So of course the highest data platforms while the spending velocity on AWS and Microsoft, uh, data platforms, outperforms that have, uh, sorry, while they're spending velocity on snowflake outperforms, that of AWS and, and Microsoft data platforms, those two are still well above the 40% line with a stronger market presence in the category. That's impressive because of their size. And you can see Google cloud and Mongo DB right around the 40% line. Now we reported on Mongo last week and discussed the commentary on consumption models. >>And we referenced Ray Lenchos what we thought was, was quite thoughtful research, uh, that rewarded Mongo DB for its forecasting transparency and, and accuracy and, and less likelihood of facing consumption headwinds. And, and I'll reiterate what I said last week, that snowflake, while seeing demand fluctuations this past quarter from those large customers is, is not like a data lake where you're just gonna shove data in and figure it out later, no schema on, right. Just throw it into the pond. That's gonna be more discretionary and you can turn that stuff off. More likely. Now you, you bring data into the snowflake data cloud with the intent of driving insights, which leads to actions, which leads to value creation. And as snowflake adds capabilities and expands its platform features and innovations and its ecosystem more and more data products are gonna be developed in the snowflake data cloud and by data products. >>We mean products and services that are conceived by business users. And that can be directly monetized, not just via analytics, but through governed data sharing and direct monetization. Here's a picture of that opportunity as we see it, this is our spin on our snowflake total available market chart that we've published many, many times. The key point here goes back to our opening statements. The snowflake data cloud is evolving well beyond just being a simpler and easier to use and more elastic cloud database snowflake is building what we often refer to as a super cloud. That is an abstraction layer that companies that, that comprises rich features and leverages the underlying primitives and APIs of the cloud providers, but hides all that complexity and adds new value beyond that infrastructure that value is seen in the left example in terms of compressed cycle time, snowflake often uses the example of pharmaceutical companies compressing time to discover a drug by years. >>Great example, there are many others this, and, and then through organic development and ecosystem expansion, snowflake will accelerate feature delivery. Snowflake's data cloud vision is not about vertically integrating all the functionality into its platform. Rather it's about creating a platform and delivering secure governed and facile and powerful analytics and data sharing capabilities to its customers, partners in a broad ecosystem so they can create additional value. On top of that ecosystem is how snowflake fills the gaps in its platform by building the best cloud data platform in the world, in terms of collaboration, security, governance, developer, friendliness, machine intelligence, etcetera, snowflake believes and plans to create a defacto standard. In our view in data platforms, get your data into the data cloud and all these native capabilities will be available to you. Now, is that a walled garden? Some might say it is. It's an interesting question and <laugh>, it's a moving target. >>It's definitely proprietary in the sense that snowflake is building something that is highly differentiatable and is building a moat around it. But the more open snowflake can make its platform. The more open source it uses, the more developer friendly and the great greater likelihood people will gravitate toward snowflake. Now, my new friend Tani, she's the creator of the data mesh concept. She might bristle at this narrative in favor, a more open source version of what snowflake is trying to build, but practically speaking, I think she'd recognize that we're a long ways off from that. And I also think that the benefits of a platform that despite requiring data to be inside of the data cloud can distribute data globally, enable facile governed, and computational data sharing, and to a large degree be a self-service platform for data, product builders. So this is how we see snow, the snowflake data cloud vision evolving question is edge part of that vision on the right hand side. >>Well, again, we think that is going to be a future challenge where the ecosystem is gonna have to come to play to fill those gaps. If snowflake can tap the edge, it'll bring even more clarity as to how it can expand into what we believe is a massive 200 billion Tam. Okay, let's close on next. Week's snowflake summit in Las Vegas. The cube is very excited to be there. I'll be hosting with Lisa Martin and we'll have Frank son as well as Christian Kleinman and several other snowflake experts. Analysts are gonna be there, uh, customers. And we're gonna have a number of ecosystem partners on as well. Here's what we'll be looking for. At least some of the things, evidence that our view of Snowflake's data cloud is actually taking shape and evolving in the way that we showed on the previous chart, where we also wanna figure out where snowflake is with it. >>Streamlet acquisition. Remember streamlet is a data science play and an expansion into data, bricks, territory, data, bricks, and snowflake have been going at it for a while. Streamlet brings an open source Python library and machine learning and kind of developer friendly data science environment. We also expect to hear some discussion, hopefully a lot of discussion about developers. Snowflake has a dedicated developer conference in November. So we expect to hear more about that and how it's gonna be leveraging further leveraging snow park, which it has previously announced, including a public preview of programming for unstructured data and data monetization along the lines of what we suggested earlier that is building data products that have the bells and whistles of native snowflake and can be directly monetized by Snowflake's customers. Snowflake's already announced a new workload this past week in security, and we'll be watching for others. >>And finally, what's happening in the all important ecosystem. One of the things we noted when we covered service now, cause we use service now as, as an example because Frank Lupin and Mike Scarelli and others, you know, DNA were there and they're improving on that service. Now in his post IPO, early adult years had a very slow pace. In our view was often one of our criticism of ecosystem development, you know, ServiceNow. They had some niche SI uh, like cloud Sherpa, and eventually the big guys came in and, and, and began to really lean in. And you had some other innovators kind of circling the mothership, some smaller companies, but generally we see sluman emphasizing the ecosystem growth much, much more than with this previous company. And that is a fundamental requirement in our view of any cloud or modern cloud company now to paraphrase the crazy man, Steve bomber developers, developers, developers, cause he screamed it and ranted and ran around the stage and was sweating <laugh> ecosystem ecosystem ecosystem equals optionality for developers and that's what they want. >>And that's how we see the current and future state of snowflake. Thanks today. If you're in Vegas next week, please stop by and say hello with the cube. Thanks to my colleagues, Stephanie Chan, who sometimes helps research breaking analysis topics. Alex, my is, and OS Myerson is on production. And today Andrew Frick, Sarah hiney, Steven Conti Anderson hill Chuck all and the entire team in Palo Alto, including Christian. Sorry, didn't mean to forget you Christian writer, of course, Kristin Martin and Cheryl Knight, they helped get the word out. And Rob ho is our E IIC over at Silicon angle. Remember, all these episodes are available as podcast, wherever you listen to search breaking analysis podcast, I publish each week on wikibon.com and Silicon angle.com. You can email me directly anytime David dot Valante Silicon angle.com. If you got something interesting, I'll respond. If not, I won't or DM me@deteorcommentonmylinkedinpostsandpleasedocheckoutetr.ai for the best survey data in the enterprise tech business. This is Dave Valante for the insights powered by ETR. Thanks for watching. And we'll see you next week. I hope if not, we'll see you next time on breaking analysis.

>> Welcome back to New York City everybody. This is The Cube's coverage of MongoDB World 2022, Dev Ittycheria, here is the president and CEO of MongoDB. Thanks for spending some time with us. >> It's Great to be here Dave, thanks for having me. >> You're very welcome. So your keynotes this morning, I was hearkening back to Steve Ballmer, running around the stage screaming, developers, developers, developers. You weren't jumping around like a madman, but the message was the same. And you've not deviated from that message. I remember when it was 10th Gen, so you've been consistent. >> Yes. >> Why is Mongo DB so alluring to developers? >> Yeah, because I would say the reason we're so popular Dave is that our whole business was founded on the ethos, so making developers incredibly productive. Just getting the infrastructure out of the way so that the developers is really focused on what's important and that's building great applications that transform their business. And the way you do that is you look at where they spend most of the time. and they spend most of the time working with data. How do you present data, the right data, the right time, at the right place, and the right way. And when you remove the friction of working with data, you unleash so much more productivity, which people just say, oh my goodness, I can move so much faster. Product leaders can get products out the door faster than the competitors. Senior level executives can seize new opportunities or respond to new threats. And that was so profound during COVID when everyone had to think about pivoting their business. >> When you came to MongoDB, why did you choose this company? What was it that excited you about it? >> I get that question a lot. I would say conventional wisdom would suggest that MongoDB was not a great choice. There weren't that many companies who were very successful in open source, Red Hat was the only one. No one had really built a deep technology company in New York city. They say, you got to do it in the valley. And database companies need a lot of capital. Now turns out that raising capital of this past decade was a lot easier, but it still takes a lot of time, and a lot of capitals, you have to have a lot of patience. When I did my diligence, I was actually a VC before I joined MongoDB. The whole next generation database segment was really taking off. And actually I looked at some competing investments to MongoDB, and when I did my diligence, it was clear even then. And this is circa 2012, that MongoDB is way ahead in terms of customer attraction, commercials, and even kind of developer mind share. And so I ended up passing those investments. and then lo and behold, I got a call from a very senior executive recruiter who said, Dev, you got to take a meeting with MongoDB, there's something really interesting going on. And they had raised a lot of capital and they had just not been able to kind of really execute in terms of the opportunity. And they realized they needed to make a change. And so one thing led to another. One of the things that really actually convinced me, is when I did my diligence, I realized the customers they had loved MongoDB. They just really weren't executing on all cylinders. And I always believe you never bet against a company whose customers love the product. And said, that's something here. The second thing I would say is open source. Yes, is true that open source was not very successful, but that was open source 1.0. Open source 2.0, the technology is much better than the commercial options. And so that convinced me. And then New York, I lived in New York a big part of my life. I think New York's a fabulous place to build a business. There's so much talent, your customers are right... You walk out the door, there's customers all over the place. And getting to Europe is very easy, Almost like flying to the west coast. So it's a very central place to build a business. >> And it's easier to fix execution, wouldn't you say? And maybe even go to market than it is to fix a product that customers really don't love. >> Correct, it's much easier to fix leadership issues, culture issues, execution issues. Nailing product market fit is very, very hard. And there were signs, there's still some issues, there's still some rough spots, but there a lot of signs that this company was very, very close, and that's why I took the bet. >> And this is before there was that huge influx of capital into the separating compute from storage and the whole cloud thing, which is interesting. Because you take a company like Cloudera, they got caught up in that and got kind of washed over. And I guess you could argue Hortonworks did too, and they could have dead ended both. And then that just didn't work. But it's interesting to see Mongo, the market kind of came to you. And that really does speak to the product. It wasn't a barrier for you. You guys have obviously a lot of work to get into the cloud with Atlas, but it seemed like a natural fit with the product. It wasn't like a complete fork. >> Well, I think the challenge that we had was we had a lot of adoption, but we had tough time commercializing the business. And at some point I had to tell the all employees, it's great that we have all these people who are using MongoDB, but if you don't start generating revenue, our investors are going to get tired of subsidizing this company. So I had to try and change the culture. And as you imagine, the engineers didn't really like the salespeople, the salespeople thought the engineers didn't really want to make any money. And what I said, like, let's all galvanize around customers and let's make them really excited and try and create a lot of value. And so we just put a lot more discipline in terms of how we prosecuted deals. We put a lot more discipline in terms of what are the problems we're trying to solve. And one thing led to another, we started building the business brick by brick. And one of the things that became clear for me was that the old open source model of trying to find that happy medium between what you give away and what you charge for, is always a tough game. Like because finding that where the paywall is, if you give away too much new features, you don't make any money. If you don't give away enough, you don't have any adoption. So you're caught in this catch-22. The best way to monetize open source, is open source as a service. And we saw Amazon do that frankly. We learned a lot from how Amazon did that. And one of the advantages that MongoDB had that I didn't fully appreciate when I joined the company, but I was very grateful. It is that they had a much more restrictive license. Which we ended up actually changing and made it even more restrictive, which allowed us to perfect ourselves from being cannibalized by the cloud providers, so that we could build our own business using our own IP that we had invested in and create a cloud service. >> That was a huge milestone. And of course you have great relationships with all the cloud providers, but it got contentious there for a while, but, you give the cloud providers an inch, they're going to take a mile. That's just the way, they're aggressive like that. But thank you for going through the history with me a little bit, because when you go back to the IPO, IPO was 2017, right? >> Correct. >> I always tell young investors, my kids especially, don't buy a stock at IPO, you're going to have a better chance, but the window from Mongo was very narrow. So, you didn't really get a much better chance a little bit. And then it's been a rocket ship since then. Sure, there's been some volatility, but you look at some of the big IPOs, like Facebook, or Snap, or even Snowflake, there was better opportunities. But you guys have executed really, really well. That's part of your ethos in your management team. And it came across on the earnings call recently. >> Yep. >> It was very optimistic, yet at the same time you set cautious tones and you got, I think high marks. >> Yes. >> For some of that caution but that execution. So talk about where you feel the business is today given the economic uncertainty? >> Well, what I'd say is we feel really good about the long term. We feel like the secular trends are really in our favor. Software's fundamentally transforming every industry. And people want to use modern software to either automate inefficient processes, enable new capabilities, drive better customer experiences. And the level of performance and scale you need for today's modern applications is profoundly different than applications yesterday. So we think we're well positioned for that. What we said on the earnings call was that we started seeing a moderation of growth, slight moderation of growth in our low end of the business in Europe. It was in our self-serve business and in the SMB space for the NQ1, towards the end of Q1. And we saw a little bit of that show up in the self-serve business in may in Q2. And that's why while we raised guidance, we basically quantified the impact, which is roughly about 30 to 35 million for the year, based on what we saw. And in that assumption, we assumed like... We just can't assume it's going to only be at the low in the market, probably some effect at the enterprise market. Maybe not as much, but there'll be some effect. So we need to factor that in. And we wanted to help kind of investors have some sort of framework to think about what the impact is. We don't want to be one of those companies that said absolutely nothing. And we don't want to be one of those companies that just waves the hand, but then it wasn't really that useful for investors. >> Yeah, I thought it was substantive. You talked about those market trends, you cited three things. The developers recognize that there are limits to legacy RDBMS. You talked about the, what I call point solutions creep. And then the document model is the best for developers. >> Great. >> And when the conversation turned to consumption, everybody's concerned about consumption obviously. You said... My take, somewhat insulated from that because you're running mission critical apps. It's not discretionary. My question to you is, should we rethink the definition of mission-critical? You think of Oracle mission critical running a bank. Mission -critical today in this digital world seems to be different, is that fair? >> Gosh, when's the last time you ever saw a website down? Like if you're running like any kind of digital channel, or engaging with the customers, or your partners, or your suppliers, you need to be up all the time. And so you need a very resilient, highly available data platform. It needs to be highly performance as you add more users, you need to be scale. And we saw a lot of that when COVID hit. Like companies had to completely repovit. And we talked about some examples where like a health and beauty retailer who was all kind of basically retail, had to suddenly pivot to e-commerce strategy. We've had streaming and gaming companies suddenly saw this massive influx of data that they scaled their operations very, very quickly. So I would say anytime you're engaging with customers, customers they're so used to the kind of the consumer facing applications. I almost joke like slow is the old down. If you're not performant, it doesn't matter. They're going to abandon you and go somewhere else. So if you're an e-commerce site and you're not performing well and not serving up the right skews, depending on what they're looking for, they're going to go somewhere else. >> So it's a click away. You talk about a hundred billion TAM, maybe that's even undercounted as you start to bring new capabilities in there. But there's no lack of market for you. >> Correct. >> How do you think about the market opportunity? >> Well, we believe... Again, software is transforming so many industries. IDC says that 715 million applications will be built over the next two to three years by 2025. To put that number of perspective, that's more apps that will be built the next three to four years than were built in the last 40. The rate and pace of innovation is as exploding. And people are building custom applications. Yes, Workday, Salesforce, other companies, commercial companies are great companies, but my competitors can use Workday or Salesforce, some of those commercial companies. That doesn't gimme a competitive advantage, what gives me a competitive advantage is building custom software that better engage my customers, that transforms my business in adding new capabilities or drives more efficiency. And the applications are only getting smarter. And so you're seeing that innovation explode and that plays to our strength. People need platforms like MongoDB to build the next generation of applications. >> So Atlas is now roughly 60% of your business, think is growing at 85%. So it's at least the midterm future. But my question to you is, is it the future? 'Cause when we start to think about the edge, it's not necessarily the cloud. You're not going to be able to go that round trip and the latency. And we had Verizon on earlier, talking about what they're doing with 5G, and the Mobile Edge. Is Mongo positioning for that edge? And is our definition of cloud changing? Where it's not just OnPrem and across clouds, but it's also out to the edge, this continuous experience. >> So I'll make two points. One, definitely we believe the applications of the future will be mobile first or purely mobile. Because one with the advent of 5G, the distinction between mobile and web is going to blur, with a hundred times faster networking speeds. But the second point I make is that how that shows up on our revenue on our income table will look like Atlas. Because we don't charge nothing for the end point, it's basically driving consumption of the back end. And so we've introduced a bunch of very, very sophisticated capabilities to synchronized data from the edge to the backend and vice versa with things like flexible sync. So we see so many customers now using that capability, whether you're field service technicians, whether you're a mobile first company, et cetera. So that will drive Atlas revenue. So on an income statement, it'll look like Atlas, but we're obviously addressing those broader set of mobile needs. >> You talk a lot about product market fit former VC, of course, Mark Andreen says, product market fit you kind of know when you see it, your hair's on fire, you can't buy a service. How do you know when you have product market fit? >> Well, one, we have the luxury of lots of customers. So they tell us pretty clearly when they're happy, and we can see that by usage behavior. Now the other benefit of a cloud service, is we can see the level of activity. We can see the level of engagement. We can see how much data they're consuming. We can see all the actions they're taking. So you get the fidelity of feedback you get from Atlas versus someone doing something behind their own firewall. And you kind of call 'em and check in on them is very, very different. So that level of insight gives us visibility in terms of what products and features have been used, gives us a sense how things going well, or is there something awry. Maybe they have misconfigured something or they don't know how to use some capabilities. So the level of engagement that we can have with a customer using a service is so much different. And so we've really invested in our customer success organization. So the byproduct of that is that our retention rates are also very, very strong. Because you have such better information about what's happening in terms of your customers. >> See retention in real time. You've been somewhat... Is just so hard to say this 'cause you're growing at 50% a year. But you're somewhat conservative about the pace of hiring for go to market. And I'm curious as to how you think about scaling, especially when you introduce new products. Atlas is several years ago. But as you extend your capabilities and add new products, how do you decide when to scale? >> So it's a constant process. We've been quite aggressive in scaling organization for a couple reasons. One, we have very low market share, so the market's vastly under penetrated. We still don't have reps in every NFL sitting in the United States, which just kind of crazy. There's other parts of the world that we are just still vastly under penetrated in. But we also look at how those organizations are doing. So if we see a team really killing it, we're going to deploy more resources. Because one, it tells us there's more opportunity there, and there's a strong team there. If we see a team that maybe is struggling a little bit, we'll try and uncover. Rather than just applying more resources in, we'll try and uncover what are the issues and make sure we stabilize the organization and then devote resources. It's all in the measure of like being very disciplined about where we deploy our resources, to get those kind of returns. And on the product side, we obviously go through a very iterative process and kind of do rank order all the projects and what we think the expected returns are. Obviously, we look at the customer feedback, we look at what our strategic priorities are. And that informs what projects we fund and what projects kind of are below the line. And we do that over and over again every quarter. So every quarter we revisit the business, we have a very QBR centric culture. So we're constantly checking in and seeing how the business is operating. And then we make those investment decisions. In general, we've been investing very aggressively in terms of expanding our reach around the world. >> It seems like, well, with Mongo, your product portfolios... From an outside observer standpoint, it seems like you've always had pretty good product market fit. But I was curious, in your VC days, would you ever encourage companies to scale go to market prior to having confidence in product market fit? Or did you always see those as sequential activities? >> Well, I think the challenge is this part it's analysis part is judgment. So you don't necessarily have to have perfect product market fit to start investing. But you also don't want to plow a bunch of resources and realize the product doesn't work and then how you're burning through a lot of cash. So there's a little bit of art to the process. When I joined MongoDB, I could tell that we had a strong engineering team. They knew how to build high quality products, but we just struggled with commercialization. The culture wasn't great across the company. And we had some leadership challenges. So that's when I joined, I kind of focused on those things and tried to bring the organization together. And slowly we started chipping away and making people feel like they were winners. And once you start winning, that becomes contagious. And then the nice thing is when you start winning, you get a lot more customer feedback. That feedback helps you refine your products even more, which then adds... It's like the flywheel effect that starts taking off. >> So it seems the culture's working now. Do you have a favorite product from the announcements today? >> Well, I really like our foray to analytics. And essentially what we're seeing is really two big trends. One you're seeing applications get smarter. What applications are doing is really automating a lot of processes and rather than someone having to press a button. Based on analytics, you can automate a lot of decision making. So that's one theme that we're seeing as applications get smarter. The second theme is that people want more and more insight in terms of what's happening. And the source of that is insights is your operational database. Because that's where you're having transactions, that's where you know what products are selling, that's where you know what customers are buying. So people want more and more real time data versus waiting to take that data, put it somewhere else and then run reports and then get some update at the end of the night or maybe at the week. So that's driving a lot of really interesting use cases. And especially when you marry in things like time series use cases where you're collecting a lot of data people want to see trend analysis what's happening. Which I think it's a very exciting area. We introduced a very cool feature called Queryable Encryption, which basically... The problem with encrypting data, is you can't really query it because my definition's encrypted. >> Yeah, you're right. >> But obviously data security is very important. What we announced, is we're using very sophisticated cryptography. People can query the data, but they don't have really access to the data. So it really protects you from like data breaches or malicious users accessing your data, but you still can kind of make that data usable. So that was a very interesting announcer that we made today. >> Sounds like magic without the performance hit. >> Yes. >> You can do that. Dev, thanks so much for coming in The Cube. Congratulations on all activity, bumper sticker on day one. >> Oh, it's super exciting. The energy was palpable, 3,300 people in the room, lots of customers, lots of users. We had lots of investors here as well for our investor day, have a dinner tonight with a bunch of senior execs, so it's been a busy day. >> Future is bright for MongoBD. Dev, thanks for so much for coming on The Cube. And thanks for watching, this is Dave Vellante and we'll see you next time. (upbeat music)

(upbeat rhythmic music) >> Everyone, I'm John Furrier with theCUBE here at Palo Alto on a remote interview for a special video interview. The EC2 15th birthday party celebration event. Raj Pai, who's the Vice President of EC2 Product Management AWS is here with me. Congratulations on Amazon Web Services, EC2 with the compute. What a journey. 15 years old. Soon we got the keys to the car at a couple more years. So Raj, great to see you. You guys have been doing great work. Congratulations. >> Thank you. It's great being here. It's super exciting for me too. I can't believe it's 15 years and you know that big, we're still at the very beginning as you know, that we often say. >> The building blocks that have been there from the beginning really set the table, and it's just been fun to watch the innovation on behalf of customers that you guys have done at AWS and more, and for entrepreneurs and for developers, it just continues to be great and the edge is right on the corner. Wavelength, all the great stuff. But let's talk about the specific topic here that I really want to drill into is that as you look at the 15th year and birthday for EC2, okay? You're looking at the future as well. You're looking at the past, present and future. And one of the things that's most compelling about recent re-invent was the Graviton performance numbers are amazing. You guys have been building custom silicon for a while. You also worked with Intel and AMD. What is it about? What's the huge investment for you guys? Where do you started to see some returns? Are you seeing returns? And then why did AWS decide to build its own processors? >> Yeah, now, that's a really good question. And I mean, like with everything else we do in AWS, it's all about innovating on behalf of our customers. And one of the things our customers are telling us, that they continue to tell us is they want to see better performance at lower prices. And we've been able to deliver that with our hardware partners for the last 15 years. But as we've understood the workloads that run on EC2 and AWS, we saw an opportunity. Like, what if we were going to go and design our own processor that was really optimized for the sort of workload that customers run on the Cloud? And make design decisions when designing the CPU and the system and the chip around the CPU that does things like bring a lot more core local cache and speed up the parts of the operations that really benefit real-world workload. So, this isn't about benchmarks. It's about how do real world workloads perform and how do we build systems that optimize that performance? And with Graviton, we were able to hit the nail on the head. We were also very pleasantly surprised when we got our first chips off the line. And we're seeing that a customer, like about 40% performance improvement at significantly lower cost. And that's super exciting. And that's one of the reasons we're getting so much interest from our customers. >> I got to say as a geek and a tech nerd, I love the silicon development. And there's benefits there, also the performance is there. The thing that also is pretty obvious that's happening is and the world seeing it is the shift towards ARM-based computing. What kinds of customers and use cases are you seeing adopt to Graviton? And what kind of workloads were they running on? What are the things that surprise you guys, that didn't surprise me. Did you guys always talk about the upcheck and how everyone's leveraging it? What are some of the examples? Take us through some of the customers, use cases, workloads. What's surprising you and what's going on with Graviton? >> Yes, so I think that the biggest surprise for us is how broadly applicable it's been. So one of the things we did, we launched with reinvent is like we have different form factors of compute. We have memory-optimized instances that are good for databases and in memory caches. We have compute optimized for HPC and workloads that really take advantage of the performance of the chip and then we have general purpose workloads. And we we introduced Graviton variants of all those instance families And we're actually seeing the same sort of performance benefits across workload. So, and it's one of the reasons why companies like Metrol, and Snap and SmugMug, they move one workload over, they see the performance benefit and before you know it, they're starting to move workloads and mass over across kind of that spectrum. So, I think that's one of the biggest surprises is that Graviton seems to do well across a wide range and we're going to keep on introducing it more and more of instance families, because we've seen this uptick well. >> You're seeing a lot of people move to the Graviton. You mentioned a few of those early adopters who were pushing the envelope, and they're always kind of trotted out there as examples at reinvent, which is always fun to see what they're working on next. And now is that people see the Graviton2 instances, okay, the architecture's different, higher performance. How much effort do our customers typically need to move to Graviton2 instances? And what are some of the benefits they're seeing on performance and price performance? Can you talk about that transition? Because that's natural evolution for them. >> Yeah. It's actually a lot less than they originally think. So, some of the hardest effort is just getting them over the line to try it. So, one of the things that we tell our customers who are considering Graviton is it just takes one or two developers take one workload and go off for a couple of weeks and just try reporting it to Graviton. And more often than not, they come back to us in four or five days. They're like, it works. And we just had to do some testing and verification, but we were able to afford it because, you know, the operating system support was there, the ISP support was there and the tools that they use, and they're using most cases, modern programming languages like Python or Go or Java or PhD where, you know, interpret the language and it just run. And so there's very little lift in comparison to what people think it's going to be. And that's one of the reasons that, you know, one of the big announcements we made in the last few weeks is what we're calling the Graviton challenge, right? So it's a set of blueprints for customers to essentially have best practices on how to in four days take, you know, a piece of code and piece of that workload and execute it and run it and migrate it to the Graviton. And we're seeing a lot of interest in that as people in the community realize how easy that actually is. >> What are some of the cool price performance things that are emerging? Obviously it makes sense if you don't really need it, don't pay for it, but you have that option. A lot of people are going there. Is there a wave you see coming that Graviton2 is going to be really set up for that you kind of see some early signals coming in, Raj? Because, I can see the 64 bit. I can see where Graviton fits today. Obviously, performance is key. Is it certain things that are emerging? What's the main problems that it solves? >> Well, I think anything that's a multi-threaded architecture is going to do really well in Graviton because of the, we have really densely packed 64 course. And so you're going to see things like microservices and containers and workloads that are more, that are able to take advantage of that parallel execution do really, really well. And so, we say 40% performance improvement, but like, when our customers have gone and tried this, they've seen upwards of 50% depending on the workload. So yeah, it's going to be more your multi-threaded application. There's some applications that may not be a fit, like it can give a legacy, you know, for example, like, there's some software that hasn't yet been moved over and we're going to continue to invest super heavily in our whole ecosystem of hardware, for the longterm. So I think that because there's a great option and we just encourage them to try it. And then they'll learn from their experience what works and what doesn't. >> Wow. 15th birthday. Still growing up and it's starting to get more mature. You're the VP of Product Management. You have the keys to the kingdom. So, you have wide-ranging responsibilities. Share with us if you can. I know that you really can't say much, but try to give a little bit of teaser. You got Wavelength. I can see the dots connecting at the edge. You got Outposts, so we see all that emerging. I can almost imagine that this is going to get stronger. What should people think about? Where's the headroom for EC2 with Graviton and Graviton2? >> Yeah, I know. I think like, a new architect (mumbles) yourself. But like, our goal is to have AWS kind of everywhere our customers are. And that means the full power of AWS. So, I think you're going to see more and more of us having EC2 in compute capacity, wherever customers need it. That could be in an Outpost. That could be on their 5G network. That could be in a city right next to them, right? And you're going to see us continue to offer the variety, the selection of instances and platforms in all those locations as well. So, I think the key for us is to be ubiquitous and have compute power everywhere our customers need it, in the form factors they need it. >> That's awesome. Congratulations. I love the power. You can't go wrong with sending computers where the data is, where the customers are. AWS, Amazon Web Services. Building their own custom silicon with Graviton2 processors. This is EC2 continuing to grow up. Raj Pai, Vice President of EC2 Product Management. Thank you for coming on and sharing the update and congratulations on the 15th birthday to EC2. >> Yeah, thanks for having me. It's been great. Have a great Friday. >> All right. Great. I'm Jeffrey with theCUBE. You're watching theCUBE coverage of EC2's 15th birthday event. Thanks for watching. (soft rhythmic music)

>>Hello, and welcome to today's event, dealing government emergency responses beyond the pandemic. This is Bob Wooley, senior fellow for the center for digital government and formerly the chief tech clerk for the state of Utah. I'm excited to serve as moderator for today's event. And just want to say, thank you for joining us. I know we're in for an informative session over the next 60 minutes before we begin a couple of brief housekeeping notes or recording of this presentation will be emailed to all registrants within 48 hours. You can use the recording for your reference or feel free to pass it along to colleagues. This webcast is designed to be interactive and you can participate in Q and a with us by asking questions at any time during the presentation, you should see a Q and a box on the bottom left of the presentation panel. >>Please send in your questions as they come out throughout the presentation, our speakers will address as many of these questions as we can during the Q and a portion of the close of our webinar today, if you would like to download the PDF of the slides for this presentation, you can do so by clicking the webinar resources widget at the bottom of the console. Also during today's webinar, you'll be able to connect with your peers by LinkedIn, Twitter and Facebook. Please use the hashtag gov tech live to connect with your peers across the government technology platform, via Twitter. At the close of the webinar, we encourage you to complete a brief survey about the presentation. We would like to hear what you think if you're unable to see with us for the entire webinar, but we're just like to complete the survey. As much as you're able, please click the survey widget at the bottom of the screen to launch the survey. Otherwise it will pop up once the webinar concludes at this time, we recommend that you disable your pop-up blockers, and if you experiencing any media player issues or have any other problems, please visit our webcast help guide by clicking on the help button at the bottom of the console. >>Joining me today to discuss this very timely topic are Karen revolt and Tim Burch, Kim Berge currently serves as the administrator of human services for Clark County Nevada. He's invested over 20 years in improving health and human service systems of care or working in the private public and nonprofit sectors. 18 of those years have been in local government in Clark County, Las Vegas, where you served in a variety of capacities, including executive leadership roles as the director of department of social services, as well as the director for the department of family services. He has also served as CEO for provider of innovative hosted software solutions, as well as chief strategy officer for a boutique public sector consulting firm. Karen real-world is the social program management offering lead for government health and human services with IBM Watson health. Karen focuses delivering exciting new offerings by focusing on market opportunities, determining unmet needs and identifying innovative solutions. >>Much of her career has been in health and human services focused on snap, TANIF, Medicaid, affordable care act, and child welfare prior to joining IBM. Karen was the senior director of product management for a systems integrator. She naturally fell in love with being a project manager. She can take her user requirements and deliver offerings. Professionals would use to make their job easier and more productive. Karen has also found fulfillment in working in health and human services on challenges that could possibly impact the outcome of people's lives. Now, before we begin our discussion of the presentation, I want to one, we'd like to learn a little more about you as an audience. So I'm going to ask you a polling question. Please take a look at this. Give us an idea of what is your organization size. I won't bother to read all these to you, but there are other a range of sizes zero to 250 up to 50,000. Please select the one that is most appropriate and then submit. >>It looks like the vast majority are zero to two 50. Don't have too many over 250,000. So this is a very, very interesting piece of information. Now, just to set up our discussion today, what I want to do is just spend just a moment and talk about the issue that we're dealing with. So when you look the COVID-19 pandemic, it's put immense pressure on States. I've been a digital state judge and had been judging a lot of the responses from States around the country. It's been very interesting to me because they bifurcate really into two principle kinds of reactions to the stress providing services that COVID environment present. One is we're in a world of hurt. We don't have enough money. I think I'm going to go home and engage as little as I have to. Those are relatively uncommon. Thankfully, most of them have taken the COVID-19 pandemic has immense opportunity for them to really do a lot more with telework, to do more with getting people, employees, and citizens involved with government services. >>And I've done some really, really creative things along the way. I find that to be a really good thing, but in many States systems have been overloaded as individuals and families throughout the country submitted just an unprecedented number of benefit applications for social services. At the same time, government agencies have had to contend with social distance and the need for a wholly different approach to engage with citizens. Um, overall most public agencies, regardless of how well they've done with technology have certainly felt some strain. Now, today we have the opportunity to go into a discussion with our speakers, have some wonderful experience in these areas, and I'm going to be directing questions to them. And again, we encourage you as you hear what they have to say. Be sure and submit questions that we can pick up later at the time. So Tim, let's start with you. Given that Las Vegas is a hub for hospitality. An industry hit severely as a result of this pandemic. How's the County doing right now and how are you prioritizing the growing needs of the County? >>Thanks Bob. Thanks for having me. Let me start off by giving just a little, maybe context for Clark County too, to our audience today. So, uh, Clark County is, you know, 85% of the state of Nevada if we serve not just as a regional County by way of service provision, but also direct municipal services. Well, if, uh, the famous Las Vegas strip is actually in unincorporated Clark County, and if we were incorporated, we would be the largest city in the state. So I say all of that to kind of help folks understand that we provide a mix of services, not just regional services, like health and human services, the direct and, and missable, uh, services as well as we work with our other five jurisdiction partners, uh, throughout the area. Uh, we are very much, um, I think during the last recession we were called the Detroit of the West. >>And, uh, that was because we're very much seen as a one industry town. Uh, so most like when the car plants, the coal plants closed back East and in the communities fuel that very rapidly, the same thing happens to us when tourism, uh, it's cut. Uh, so of course, when we went into complete shutdown and March, uh, we felt it very rapidly, not just on, uh, uh, tax receipts and collectibles, but the way in which we could deliver services. So of course our first priority was to, uh, like I think you mentioned mobilized staff. We, we mobilized hundreds of staff overnight with laptops and phones and cars and the things they needed to do to get mobile and still provide the priority services that we're mandated to provide from a safety standpoint. Um, and then we got busy working for our clients and that's really where our partnership with IBM and Watson, uh, came in and began planning that in July. And we're able to open that portal up in October to, to really speed up the way in which we're giving assistance to, to our residents. Um, re focus has been on making sure that people stay housed. We have, uh, an estimated, uh, 2.5 million residents and over 150,000 of those households are anticipated to be facing eviction, uh, as of January one. So we, we've got a, a big task ahead of us. >>All of this sounds kind of expensive. Uh, one of the common threads as you know, runs throughout government is, ah, I don't really have the money for that. I think I'd be able to afford that a diaper too, as well. So what types of funding has been made available for counties, a result of a pandemic, >>Primarily our funding stream that we're utilizing to get these services out the door has been the federal cares act. Uh, now we had some jurisdictions regionally around us and even locally that prioritize those funds in a different way. Um, our board of County commissioners, uh, took, um, a sum total of about $85 million of our 240 million that said, this will go directly to residents in the form of rental assistance and basic needs support. No one should lose their home or go hungry during this pandemic. Uh, so we've really been again working through our community partners and through our IBM tools to make sure that happens. >>So how does, how does, how does the cares act funding then support Clark County? Cause it seems to me that the needs would be complex, diverse >>Pretty much so. So as you, as folks may know him a call there's several tronches of the cares act, the original cares act funding that has come down to us again, our board, uh, identified basic needs or rental assistance and, and gave that the department of social service to go to the tunicate, uh, through the community. We then have the cares act, uh, uh, coronavirus relief funds that have, uh, impacted our CDBG and our emergency solutions grants. We've taken those. And that's what we was going to keep a lot of the programs and services, uh, like our IBM Watson portal open past January one when the cares act dollars expire. Uh, our initial response was a very manual one, uh, because even though we have a great home grown homeless management information system, it does not do financials. Uh, so we had 14 local nonprofits adjudicating, uh, this rental assistance program. >>And so we could get our social service visitor portal up, uh, to allow us to take applications digitally and run that through our program. Uh, and, uh, so those partners were obviously very quickly overwhelmed and were able to stand up our portal, uh, which for the reason we were driving so hard, even from, uh, beginning of the conversations where after going into lockdown into contracting in July and getting the portal open in October, which was an amazing turnaround. Uh, so the kudos that IBM team, uh, for getting us up and out the door so quickly, uh, was a tie in, uh, to our, uh, Curam IBM, uh, case management system that we utilize to adjudicate benefits on daily basis in Clark County for all our local indigent population, uh, and high needs folks. Uh, and then that ties into our SAP IBM platform, which gets the checks out the door. >>So what, what we've been able to do with these dollars is created in Lucian, uh, that has allowed us in the last 60 days to get as much money out the door, as our nonprofits were able go out the door in the first six months pandemic. So it really has helped us. Uh, so I'm really grateful to our board of County commissioners for recognizing the investment in technology to, to not only get our teams mobile, but to create ease of access for our constituents and our local residents to give them the help they need quickly and the way that they need it. >>Just to follow up question to that, Tim, that I'm curious about having done a lot of work like this in government, sometimes getting procurement through in a timely way is a bit challenging. How were you able to work through those issues and getting this up and provision so quickly? >>Uh, yeah, so we, we put together a, what we call a pandemic playbook, which is kind of lessons learned. And what we've seen is the folks who were essential workers in the first 60 days of the, uh, pandemic. We were able to get a lot done quickly because we were taking full advantage of the emergency. Uh, it may sound a little crass to folks not inside the service world, but it was, uh, you know, don't want you to crisis. It was things we've been planning or trying to do for years. We need them yesterday. We should have had them yesterday, but let's get them tomorrow and get it moving very quickly. Uh, this IBM procurement was something we were able to step through very quickly because of our longstanding relationship. Our countywide, uh, system of record for our financials is SAP. Uh, we've worked with Curam, uh, solution, uh, for years. >>So we've got this long standing relationship and trust in the product and the teams, which helped us build the business case of why we did it, no need to go out for competitive procurement that we didn't have time. And we needed something that would integrate very quickly into our existing systems. Uh, so that part was there. Now when the folks who were non essential came back in June and the reopening, it was whiplash, uh, the speed at which we were moving, went back to the pace of normal business, uh, which feels like hitting a wall, doing a hundred miles an hour when you're used to having that, uh, mode of doing business. Uh, so that's certainly been a struggle, uh, for all of those involved, uh, in trying to continue to get things up. Um, but, uh, once again, the teams have been great because we've probably tripled our licensure on this portal since we opened it, uh, because of working with outside vendors, uh, to, uh, literally triple the size of our staff that are processing these applications by bringing on temporary staff, uh, and short-term professionals. Uh, and so we've been able to get those things through, uh, because we'd already built the purchasing vehicle during the early onset of the crisis. >>That's very helpful. Karen, IBM has played a really pivotal role in all of this. Uh, IBM Watson health works with a number of global government agencies, raging from counties like Clark County to federal governments. What are some of the major challenges you've seen with your clients as a result of the pandemic and how is technology supporting them in a time of need and give us some background Watson health too. So we kind of know a little more about it because this is really a fascinating area. >>Yeah. Thank you, Bob. And thanks Tim for the background on Clark County, because I think Clark County is definitely also an example of what federal governments and global governments are doing worldwide today. So, um, Watson health is our division within IBM where we really focus on health and human services. And our goal is to really focus in on, um, the outcomes that we're providing to individuals and families and looking at how we use data and insights to really make that impact and that change. And within that division, we have our government health and human services area, which is the focus of where we are with our clients around social program. But it also allows us to work with, um, different agencies and really look at how we can really move the ball in terms of, um, effecting change and outcomes for, um, really moving the needle of how we can, uh, make an impact on individuals and families. >>So as we look at the globe globally as well, you know, everything that Tim had mentioned about how the pandemic has really changed the way that government agencies operate and how they do services, I think it's amazing that you have that pandemic playbook because a lot of agencies in the same way also had these set of activities that they always wanted to go and take part on, but there was no impetus to really allow for that to happen. And with the pandemic, it allowed that to kind of open and say, okay, we can try this. And unfortunately I'm in a very partial house way to do that. And, um, what Tim has mentioned about the new program that they set up for the housing, some of those programs could take a number of years to really get a program online and get through and allowing, uh, the agencies to be able to do that in a matter of weeks is amazing. >>And I think that's really gonna set a precedent as we go forward and how you can bring on programs such as the housing and capability in Canada with the economic, uh, social, um, uh, development and, and Canada need that the same thing. They actually had a multi benefit delivery system that was designed to deliver benefits for three programs. And as part of the department of fisheries and oceans Canada, the, um, the state had an emergency and they really need to set up on how they could provide benefits to the fishermen who had been at that impacted, um, from that. And they also did set up a digital front-end using IBM citizen engagement to start to allow the applications that benefits, um, and they set it up in a matter of weeks. And as I mentioned, we, uh, Clark County had a backend legacy system where they could connect to and process those applications. And this case, this is a brand new program and the case management system that they brought up was on cloud. And they had to set up a new one, but allow them to set up a, what we used to call straight through processing, I think has been now turned, turned or coined contact less, uh, processing and allowing us to really start to move those benefits and get those capabilities out to the citizens in even a faster way than has been imagined. Uh, pre pandemic. >>Karen, I have one follow-up question. I want to ask you, having had a lot of experience with large projects in government. Sometimes there's a real gap between getting to identified real requirements and then actions. How do you, how do you work with clients to make sure that process time to benefit is shortened? >>So we really focus on the user themselves and we take a human centered design focus and really prioritizing what those needs are. Um, so working with the clients, uh, effectively, and then going through agile iterations of brain, that capability out as, um, in, in a phased approach to, so the idea of getting what we can bring out that provides quality and capability to the users, and then over time starting to really roll out additional functions and, um, other, uh, things that citizens or individuals and families would need >>Very helpful. Tim, this is an interesting partnership. It's always good to see partnerships between private sector and government. Tell us a little bit about how the partnership with IBM Watson health was established and what challenges or they were brought into assist, where they brought into assist with back to requirements. Again, within the requirements definitely shifted on us. You know, we had the con looking at, uh, Watson on our child welfare, uh, side of the house that I'm responsible for and how that we could, uh, increase access to everything from tele-health to, to, uh, foster parent benefit, uh, kinship, placement benefits, all those types of things that, that right now are very manual, uh, on the child welfare side. Uh, and then the pandemic kid. And we very quickly realized that we needed, uh, to stand up a, um, a new program because, uh, a little bit for context, uh, the park County, we don't administer TANIF or Medicaid at the County level. >>It is done at the state level. So we don't have, uh, unemployment systems or Medicaid, 10 of snap benefits systems to be able to augment and enroll out. We provide, uh, the indigent supports the, the homelessness prevention, referee housing continuum of care, long-term care, really deep emergency safety net services for our County, which is a little bit different and how those are done. So that was really our focus, which took a lot of in-person investigation. We're helping people qualify for disability benefits so they can get into permanent supportive housing, uh, things that are very intensive. And yet now we have a pandemic where we need things to happen quickly because the cares act money expires at the end of December. And people were facing eviction and eviction can help spread exposure to, to COVID. Uh, so, uh, be able to get in and very rapidly, think about what is the minimal pelvis to MVP. >>What's the minimum viable product that we can get out the door that will help people, uh, entrance to a system as contactless as possible, which again was a complete one 80 from how we had been doing business. Um, and, uh, so the idea that you could get on and you have this intelligent chat bot that can walk you through questions, help you figure out if you look like you might be eligible, roll you right into an application where you can upload the few documents that we're going to require to help verify your coat would impact and do that from a smartphone and under, you know, 20 minutes. Um, it, it, it is amazing. And the fact that we've stood that up and got it out the door in 90 days, it's just amazing to me, uh, when it shows the, uh, strength of partnership. Um, I think we can, we have some shared language because we had that ongoing partnership, but we were able to actually leverage some system architects that we had that were familiar with our community and our other products. So it really helped expedite, uh, getting this, uh, getting this out to the citizens. >>So, uh, I assume that there are some complexities in doing this. So overall, how has this deployment of citizen engagement with Watson gone and how do you measure success other than you got it out quick? How do you know if it's working? >>Yeah. Right. So it's the adage of, you know, quick, fast and good, right. Um, or fast, good and cheap. So, uh, we measure success in this way. Um, how are we getting access as our number one quality measurement here? So we were able to collect, uh, about 13,000 applications, uh, manual NRC, manually folks had to go onto our website, download a PDF, fill it out, email it, or physically drop it off along with their backup. One of their choice of 14 non-profits in town, whichever is closest to them. Um, and, uh, and then wait for that process. And they were able to get 13,000 of those, uh, process for the last six months. Uh, we have, I think we had about 8,000 applications the first month come into the portal and about an equal amount of folks who could not provide the same documentation that it was needed. >>And self-selected out. If we had not had the, the tool in place, we would have had 16,000 applications, half of which would have been non-eligible would have been jamming up the system, uh, when we don't have the bandwidth to deal to deal with that, we, we need to be able to focus in on, uh, Judy Kenny applications that we believe are like a 95% success rate from the moment our staff gets them, but because we have the complex and he was on already being dependent upon the landlord, having to verify the rent amount and be willing to work with us, um, which is a major hurdle. Um, but, uh, so w we knew we could not do is go, just reinvent the manual process digitally that that would have been an abject failure on our behalf. So, uh, the ideas that, uh, folks had can go on a very, had this very intuitive conversation to the chat bot, answer some questions and find out if they're eligible. >>And then self-select out was critical for us to not only make sure that the citizens got the help they needed, but not so burnt out and overload our workforce, which is already feeling the strain of the COVID pandemic on their own personal lives and in their homes and in the workplace. Um, so that was really critical for us. So it's not just about speed, ease of access was important. Uh, the ability to quickly automate things on the fly, uh, we have since changed, uh, the area median income, a qualifier for the rental assistance, because we were able to reallocate more money, uh, to the program. So we were able to open it up to more people. We were able to make that, uh, change to the system very quickly. Uh, the idea that we can go on the home page and put updates, uh, we recognized that, uh, some of our monolingual Hispanic residents were having difficulty even with some guidance getting through the system. >>So we're able to record a, a Spanish language walkthrough and get done on the home page the next day, right into the fordable, there'll be a fine, so they could literally run the YouTube video while they're walking through their application. Side-by-side so things like that, that those are how we are able to, for us measured success, not just in the raw dollars out the door, not just in the number of applications that have come in, but our ability to be responsive when we hear from our constituents and our elected officials that, Hey, I want, I appreciate the 15,000 applications as you all, a process and record time, I've got three, four, five, six, 10 constituents that having this type of problem and be able to go back and retool our systems to make them more intuitive, to do, be able to keep them responsive for us is definitely a measure of success and all of this, probably more qualitative than here we're looking >>For, but, uh, that's for us, that's important. Actually the qualitative side is what usually gets ignored. Uh, Karen, I've got a question that's a follow up for you on the same topic. How does IBM facilitate reporting within this kind of an environment given the different needs of stakeholders, online managers and citizens? What kinds of things do you, are you able to do >>So with, um, the influx of digitalization? I think it allows us to really take a more data-driven approach to start looking at that. So, as, as Tim was mentioning, you can see where potentially users are spending more time on certain questions, or if they're stuck on a question, you can see where the abandoned rate is. So using a more data-driven approach to go in to identify, you know, how do we actually go and, um, continue to drive that user experience that may not be something that we drive directly from the users. So I would say that analytics is really, uh, I think going to continue to be a driving force as government agencies go forward, because now they are capturing the data. But one thing that they have to be careful of is making sure that the data that they're getting is the right data to give them the information, to make the right next steps and decisions. >>And Tim, you know, use a really good example with, um, the chatbot in terms of, you know, with the influx of everything going on with COVID, the citizens are completely flooded with information and how do they get the right information to actually help them decide, can I apply for this chap program? Or should I, you know, not even try and what Tim mentioned just saved the citizens, you know, the people that may not be eligible a lot of time and going through and applying, and then getting denied by having that upfront, I have questions and I need answers. Um, so again, more data-driven of how do we provide that information? And, you know, we've seen traditionally citizens having to go on multiple website, web pages to get an answer to the question, because they're like, I think I have a question in this area, but I'm not exactly sure. And they, then they're starting to hunt and hunt and hunt and not even potentially get an answer. So the chocolate really like technology-wise helps to drive, you know, more data-driven answers to what, um, whether it's a citizen, whether it's, um, Tim who needs to understand how and where my citizens getting stuck, are they able to complete the application where they are? Can we really get the benefits to, um, this individual family for the housing needs >>Too many comments on the same thing. I know you have to communicate measures of success to County executives and others. How do you do that? I mean, are you, do you have enough information to do it? Yeah, we're able to, we actually have a standup meeting every morning where the first thing I learn is how many new applications came in overnight. How many of those were completed with full documentation? How many will be ported over into our system, assigned the staff to work, where they're waiting >>On landlord verification. So I can see the entire pipeline of applications, which helps us then determine, um, Oh, it's, it's not, you know, maybe urban legend is that folks are having difficulty accessing the system. When I see really the bottleneck there, it got gotten the system fine, the bottlenecks laying with our landlord. So let's do a landlord, a town hall and iterate and reeducate them about what their responsibilities are and how easy it is for them to respond with the form they need to attest to. And so it lets us see in real time where we're having difficulties, uh, because, uh, there's a constant pressure on this system. Not just that, uh, we don't want anyone to lose their home, uh, but these dollars also go away within a December. So we've got this dual pressure of get it right and get it right now. >>Uh, and so th the ability to see these data and these metrics on, on a daily basis is critical for us to, to continue to, uh, ModuLite our response. Um, and, and not just get comfortable are baked into well, that's why we developed the flowchart during requirements, and that's just the way things are gonna stay. Uh, that's not how you respond to a pandemic. Uh, and so having a tool and a partner that helps us, uh, stay flexible, state agile, I guess, to, to, to leverage some terminology, uh, is important. And, and it's, it's paid dividends for our citizens. Karen, again, is another up to the same thing. I'm kind of curious about one of the problems of government from time to time. And Tim, I think attest to this is how do you know when Dunn has been reached? How did you go about defining what done would look like for the initial rollout with this kind of a customer? >>So I think Doug, I guess in this case, um, is, is this, isn't able to get the benefits that they're looking for and how do we, uh, you know, starting from, I think what we were talking about earlier, like in terms of requirements and what is the minimum viable, um, part of that, and then you start to add on the bells and whistles that we're really looking to do. So, um, you know, our team worked with him to really define what are those requirements. I know it's a new program. So some of those policy decisions were still also being worked out as the requirements were being defined as well. So making sure that you are staying on top of, okay, what are the key things and what do we really need to do from a compliance standpoint, from a functionality, and obviously, um, the usability of how, uh, an assistant can come on and apply and, um, have those, uh, requirements, make sure that you can meet that, that version before you start adding on additional scope. >>Very helpful. Jim, what's your comment on this since I know done matters to you? Yeah. And look, I I've lived through a, again, multiple, uh, county-wide it implementations and some department wide initiatives as well. So I think we know that our staff always want more so nothing's ever done, uh, which is a challenge and that's on our side of the customer. Um, but, uh, for this, it really was our, our experience of recognizing the, the time was an essence. We didn't have a chance. We didn't have, uh, the space to get into these endless, uh, conversations, uh, the agile approach, rather than doing the traditional waterfall, where we would have been doing requirements tracking for months before we ever started coding, it was what do we need minimally to get a check in the hands of a landlord on behalf of a client, so they don't get evicted. >>And we kept just re honing on that. That's nice. Let's put that in the parking lot. We'll come back to it because again, we want to leverage this investment long term, uh, because we've got a we, and we've got the emergency solutions and CDBG, and then our, uh, mainstream, uh, services we brought on daily basis, but we will come back to those things speed and time are of the essence. So what do we need, uh, to, to get this? So a chance to really, um, educate our staff about the concepts of agile iteration, um, and say, look, this is not just on the it side. We're gonna roll a policy out today around how you're doing things. And we may figure out through data and metrics that it's not working next week, and we'll have to have that. You want it. And you're going to get the same way. >>You're getting updated guidance from the CDC on what to do and what not to do. Uh, health wise, you're getting the same from us, uh, and really to helping the staff understand that process from the beginning was key. And, uh, so, and, and that's, again, partnering with, with our development team in that way was helpful. Um, because once we gave them that kind of charter as I am project champion, this is what we're saying. They did an equally good job of staying on task and getting to the point of is this necessary or nice. And if it wasn't necessary, we put it in the nice category and we'll come back to it. So I think that's really helpful. My experience having done several hundred sheet applications also suggest the need for MBP matters, future stages really matter and not getting caught. My flying squirrels really matters. So you don't get distracted. So let's move on to, let's do a polling question before we go on to some of our other questions. So for our audience, do you have a digital front ends for your benefit delivery? Yes, no. Or we're planning to a lot of response here yet. There we go. Looks like about half, have one and half note. So that's an interesting question. What's going to one more polling question, learn a little more here. Has COVID-19 >>Accelerated or moved cloud. Yes, no. We already run a majority of applications on cloud. Take a moment and respond if you would, please. So this is interesting. No real acceleration was taken place and in terms of moving to cloud is not what I was expecting, but that's interesting. So let's go onto another question then. And Karen, let me direct this one to you, given that feedback, how do you envision technologies such as citizen engagement and watching the system will be used, respond to emergency situations like the pandemic moving forward? I mean, what should government agencies consider given the challenges? This kind of a pandemic is brought upon government and try to tie this in, if you would, what, what is the role of cloud in all of this for making this happen in a timely way? Karen, take it away. >>Okay. Thanks Bob. So as we started the discussion around the digital expansion, you know, we definitely see additional programs and additional capabilities coming online as we continue on. Um, I think, uh, agencies have really seen a way to connect with their citizens and families and landlords, um, in this case an additional way. And he prepared them like there were, uh, presuppose assumptions that the, um, the citizens or landlords really wanted to interact with agency face-to-face and have that high touch part. And I think, um, through this, the governments have really learned that there is a way to still have an impact on the citizen without having a slow, do a face to face. And so I think that's a big realization for them to now really explore other ways to digitally explain, expand their programs and capabilities. Another area that we touched on was around the AI and chat bot piece. >>So as we start to see capabilities like this, the reason why Clark County was able to bring it up quickly and everything was because it was housed on cloud, we are seeing the push of starting to move some of the workloads. I know from a polling question perspective that it's been, um, lighter in terms of getting, uh, moving to the cloud. But we have seen the surge of really chatbots. I think we've been talking about chatbots for a while now. And, um, agencies hadn't really had the ability to start to implement that and really put it into effect. But with the pandemic, they were able to bring things up and, you know, very short amount of time to solve, um, a big challenge of not having the call center be flooded and have a different way to direct that engagement between the citizen and the government. >>So really building a different type of channel for them to engage rather than having to call or to come into an office, which wasn't really allowed in terms of, um, the pandemic. Um, the other thing I'll touch on is, um, 10 mentioned, you know, the backlog of applications that are coming in and we're starting to see the, um, the increase in automation. How do we automate areas where it's administratively highly burdened, but it's really a way that we can start to automate those processes, to give our workers the ability to focus on more of those complex situations that really need attention. So we're starting to see where the trends of trying to push there of can we automate some of those processes, um, uh, uploading documents and verification documents is another way of like, trying to look at, is there a way that we can make that easier? >>Not only for the applicant that's applying, but also for the caseworker. So there's not having to go through that. Um, does the name match, um, the applicant, uh, information and what we're looking on here, and Bob, you mentioned cloud. So behind the scenes of, you know, why, uh, government agencies are really pushing the cloud is, um, you heard about, I mean, with the pandemic, you see a surge of applicants coming in for those benefits and how do we scale for that kind of demand and how do you do that in an inappropriate way, without the huge pressures that you put on to your data center or your staff who's already trying to help our citizens and applicants, applicants, and families get the benefits they need. And so the cloud, um, you know, proposition of trying, being able to be scalable and elastic is really a key driver that we've seen in terms of, uh, uh, government agencies going to cloud. >>We haven't really seen during a pandemic, the core competencies, some of them moving those to cloud, it's really been around that digital front end, the chat bot area of how do we start to really start with that from a cloud perspective and cloud journey, and then start to work in the other processes and other areas. Um, security is also huge, uh, focus right now with the pandemic and everything going online. And with cloud allows you to be able to make sure that you're secure and be able to apply the right security so that you're always covered in terms of the type of demand and, um, impact, uh, that is coming through >>Very helpful. Tim, I'm going to ask to follow up on this of a practical nature. So you brought this up very quickly. Uh, there's a certain amount of suspicion around state government County government about chatbots. How did you get a chat much and be functional so quickly? And were you able to leverage the cloud in this process? Yeah, so on the trust is important. Uh, and I'll go back to my previous statement about individuals being able to see upfront whether they believe they're eligible or not, because nothing will erode trust more than having someone in hours applying and weeks waiting to find out they were denied because they weren't eligible to begin with, uh, that erodes trust. So being able to let folks know right up front, here's what it looks like to be eligible, actually help us build some of that, uh, cause they don't feel like, uh, someone in the bureaucracy is just putting them through the ringer for no reason. >>Um, now in regard to how do we get the chat bot out? I will say, uh, we have a, uh, dynamic it and leadership, uh, team at the highest level of County government who we have been already having conversations over the last year about what it meant to be smart government, uh, the department of social service and family services that I'm responsible for. We're already, uh, hands up first in line, you know, Guinea pigs volunteering to be on the front end of, uh, certain projects. So w we have primed ourselves for, for some of this readiness in that aspect. Um, but for citizen trust, um, the timeliness of application right now is the biggest element of trust. Uh, so I've applied I've I feel like I put my housing future in your hands. Are you going to deliver and having the ability for us to rapidly scale up? >>Uh, we typically have 120 staff in the department of social service that, that are adjudicating benefits for programs on daily basis. We've doubled that with temporary staff, uh, through some partnerships, uh, we're, we're gonna, as of next week, probably have more temporary per professional staff helping an adjudicator applications. No, do full-time County staff, because again, this rush to get the dollars out, out the door. So having a system where I can easily, uh, ramp on new users and manage them without having to be solely dependent upon an already, uh, overworked it staff who were trying to support 37 other departments in the County, um, around infrastructure needs has been greatly helpful. Sounds to me like a strong outcome focus and one that seems to work. Let's move on now to our audience questions. We're getting close to the end of our time. So let's jump into some questions from the audience. A number of you have been asking about getting copies of today's presentation within the next 48 hours. Government technology will provide all attendees with the link to the recording for your reference, or to share with colleagues. Well, let's go to our first question. So this is an interesting one. And Karen, this is for you did IBM work with other counties and States to provide digital engagement portals. >>We did Bob, uh, we've worked, um, so globally we've provided guidance on this. We work closely with New York city. They've been the integral part of the development also with our citizen engagement offering. Um, we work closely with the States. So we worked with New York city. Um, North Carolina was also another state who, um, improved their, uh, citizen engagement piece, bring up their Medicaid and snap, um, applications along with Medicaid. COVID testing along that. And I mentioned, um, the economic and social development in Canada as well. And we also work with the ministry of social development in Singapore. So a number of our customers had put up, uh, a global, uh, or sorry, a citizen engagement frontend. And during this timeframe, >>Very helpful. I don't know how much did you hear your mom provide you, but how much did it cost for initial deployment and what are the ongoing costs in other words, is this thing going to be sustainable over time? >>Yeah, absolutely. So total, uh, to date, we've spent about a $1.8 million on development implementations and licensure. A big chunk of that again has been the rapid extended of licensure, uh, for this program. Um, I think over a third of that is probably licensing because again, we need to get the dollars out and we need staff to do that and making the short term several hundred thousand dollar investment in a professional support staff and having them be able to work this portal is much cheaper than the long-term investment of bringing on a staff, printing a job, uh, during a financial difficulty that we're facing, uh, the single largest fiscal cliff let's get into that us history. Um, so it's not smart to create jobs that have a 30 year, one way to retirement, uh, inside our in unionized government environment here. So having this, the staff that would come on and do this and get out the door on these federal dollars was critical for us. Um, and there is a $800,000 a year, I believe so ongoing costs associated with licensure and, and the programming support. Uh, but once again, we're going to be moving, um, our traditional services into this digital front end. We'll be continuing this because we're, we're, we're facing, it took us, I think, six and a half, seven years to come back from the previous recession. Undoubtedly, take a little longer to get back >>From this one. Here's another interesting question, I guess really primarily Tim Tim was the solution on primarily on premise or in the cloud. >>So we'll, we've done a mix. Uh, the, and I'm starting a lot of feedbacks. I don't know if you all can hear that or not, but the, uh, I think we went on prem for, uh, some people because of the, uh, bridge into our service case manager system, which is on prem. So we did some management there. I do believe the chat bot piece of it though is in the cloud. So we're bringing it down to, from one system to the other. Uh, and, and part of that was a student negotiations and costs and worrying about what long-term is that we have a very stated goal of moving, uh, our Curam platform, which is on-prem, this is the backend. So how are we? We, we set our IBM Watson, uh, portal up, uh, and moving all of that on cloud, uh, because I mean, we've got, uh, a workforce who, uh, has the ability to retire at a very high rate over the next five years. >>And, uh, having 24 seven support in the cloud is, is as a, someone who would be called to respond to emergency situations like the is, is a much better Cod deal for, for myself and the citizen. So migrating, uh, and, um, our typical on-prem stuff up into the cloud, uh, as we continue on this, uh, evolution of what IBM Watson, uh, and the plug into our Curam, uh, system looks like Karen related question for another user is the portal provided with Clara County and others linked to other third-party backend office apps, or can it be, >>Yeah, the answer is it can be it's interoperable. So through APIs, uh, rest, uh, however, um, assistance that they need to be integrated with can definitely be integrated with, uh, like, uh, Tim mentioned, we, we went to the case management solution, but it can be integrated with other applications as well. >>Tim, did you use some other backend third party apps with yours? Uh, we did not. Uh, again, just for speed of getting, uh, this MVP solution out the door. Uh, now what we do with that on the go forward, it is going to look different and probably will include some, another practical question. Given the cares funding should be expended by December. Can this application even be employed at this late date? And you want to take a cut at that? Yeah, for us, uh, once again, we brought up earlier, um, the emergency solutions grants and the community development block grants, which have a Corona virus, uh, CV traunch, each one of those, and those have two to three year expenditure timeframes on them. Uh, so we were going to leverage those to keep this system and some of these programs going once again, that the housing needs, uh, will outstrip our capacity for years to come. >>I guess probably I should have said upfront Las Vegas has one of the worst affordable housing inventories in the nation. Uh, so we know we're going to be facing a housing issue, um, because of this for, for a long time. So we'll be using those two traunches of dollars, ESE, ESPs, uh, CV CDBG, CB funds, uh, in addition to dollars earmarked through some, uh, recreational marijuana license fees that have been dedicated to our homelessness. And when you consider this housing, uh, stability program was part of that homelessness prevention. That's our funding mix locally. Very helpful. So questions maybe for bolts for you on this one, you can probably also teach respond is the system has been set up helping the small business community. Um, this user's been canvassing and the general feeling is that small businesses have been left behind and they've been unable to access funds. What's your response on that? Karen, do you want to take that first? >>Um, yes. So in terms of, uh, the security and sorry. Um, but, uh, can you repeat the last part of that? I just missed the last part when you >>Behind it, but unable to access funds. >>Uh, yeah, so I think from a funding perspective, there's different types of, I think what Tim mentioned in terms of the cares funding, there was different types of funding that came out from a government perspective. Uh, I think there were also other grants and things that are coming out one, uh, that we're still looking at. And I think as we go into the new year, it'll be interesting to see, you know, what additional funding, um, hopefully is, is provided. Uh, but in terms of creativity, we've seen other creative ways that organizations come together to kind of, uh, help with the different agencies, to provide some, some guidance to the community, um, and helping to, uh, provide efforts and, uh, maybe looking at different ways of, um, providing, uh, some of the capabilities that the, either at the County or at the state level that they're able to leverage. But Tim happy to maybe have you chime in here too. >>Yeah. So I'll first start with my wheelhouse and I'll expand out to, to some of my partners. Uh, so the primary, small business, we knew the idea was a daily basis inside this realm is going to be landlords. Uh, so actually this afternoon, we're doing a town hall with folks to be able to roll out, uh, which they will go to our portal to find a corporate landlord program. Uh, so that I seem a landlord for Camille the application pack and on behalf of a hundred residents, rather than us having to adjudicate a hundred individual applications and melon a hundred checks. Uh, so that is because we were listening to that particular segment of the, uh, the business community. Now I know early on, we were, we were really hoping that the, the paycheck protection program federally would have, uh, been dispersed in a way that helped our local small businesses. >>Uh, more we did a, our economic development team did a round of small business supports through our cares act. Uh, our quarterly unfortunate was not open yet. It was just about 15, 20 days shy. So we use, uh, another traditional grant mechanism that we have in place to dedicate that. Uh, but on a go forward board, willing to Congress passes something over the next 30 days, um, that if there's a round two of cares or some other programs, we absolutely now have a tool that we know we can create a digital opening for individuals to come figure out if they're eligible or not for whatever program it is, the it housing, the it, uh, small business operations supports, uh, and it would apply through that process and in a very lightweight, so we're looking forward to how we can expand our footprint to help all of the needs that are present in our community. This leads to another question which may be our last one, but this is an interesting question. How can agencies use COVID-19 as a proof point providing a low cost configurable solutions that can scale across government. Karen, do you want to respond to that? And then Tim also, >>Thanks, Bob. So I believe like, you know, some of the things that we've said in terms of examples of how we were able to bring up the solution quicker, I definitely see that scaling as you go forward and trying to really, um, focus in on the needs and getting that MVP out the door. Uh, and then Tim alluded to this as well. A lot of the change management processes that went into re-imagining what these processes look like. I definitely see a additional, you know, growth mindset of how do we get better processes in place, or really focusing on the core processes so that we can really move the ball forward and continuing to go that path of delivering on a quicker path, uh, leveraging cloud, as we mentioned of, um, some, some of the capabilities around the chat bot and other things to really start to push, um, uh, the capabilities out to those citizens quicker and really reduce that timeline that we have to take on the backend side, um, that that would be our hope and goal, um, given, you know, sort of what we've been able to accomplish and hoping using that as a proof point of how we can do this for other types of, uh, either programs or other processes. >>Yeah, I think, um, the, you know, the tool has given us capability now there, whether we use local leaders leverage that to the fullest really becomes a coming upon us. So do we take a beat, uh, when we can catch our breath and then, you know, work through our executive leadership to say, look, here's all the ways you can use this tool. You've made an enterprise investment in. Um, and I know for us, uh, at Clark County, we've stood up, uh, enterprise, uh, kind of governance team where we can come and talk through all of our enterprise solutions, uh, encourage our other department head peers, uh, to, to examine how you might be able to use this. Is there a way that, um, you know, parks and rec might use this to better access their scholarship programs to make sure that children get into youth sports leagues and don't get left out, uh, because we know youth suicide on the rise and they need something positive to do when this pandemic is clear, I'm there for them to get out and do those things. >>So the possibilities really are out there. It really becomes, um, how do we mind those internally? And I know that being a part of listservs and, uh, you know, gov tech and all the magazines and things are out there to help us think about how do we better use our solutions, um, as well as our IBM partners who are always eager to say, Hey, have you seen how they're using this? Um, it is important for us to continue to keep our imaginations open, um, so that we continue to iterate through this process. Um, cause I, I would hate to see the culture of, um, iteration go away with this pandemic. >>Okay. We have time for one final question. We've already addressed this in part two, and this one is probably for you and that you've used the cares act to eliminate some of the procurement red tape that's shown up. Well, how do you somehow that's been very positive. How do you see that impacting you going forward? What happens when the red tape all comes back? >>Yeah, so I think I mentioned a little bit, uh, about that when some of the folks who are deemed non essential came back during our reopening phases and they're operating at the speed of prior business and red tape where we had all been on this, these green tape, fast tracks, uh, it, it was a bit of a organizational whiplash. Uh, but it, for us, we've had the conversation with executive management of like, we cannot let this get in the way of what our citizens need. So like keep that pressure on our folks to think differently. Don't and, uh, we've gone so far as to, uh, even, uh, maybe take it a step further and investigate what had been done in, in, in Canada. Some other places around, um, like, like going right from in a 48 hour period, going from a procurement statement through a proof of concept and doing purchasing on the backside, like how can we even get this even more streamlined so that we can get the things we need quickly, uh, because the citizens don't understand, wait, we're doing our best, uh, your number 3000 and queue on the phone line that that's not what they need to hear or want to hear during times of crisis. >>Very helpful. Well, I want to be respectful of our one hour commitment, so we'll have to wrap it up here in closing. I want to thank everyone for joining us for today's event and especially a big, thank you goes to Karen and Tim. You've done a really great job of answering a lot of questions and laying this out for us and a special thanks to our partners at IBM for enabling us to bring this worthwhile discussion to our audience. Thanks once again, and we look forward to seeing you at another government technology event,

>>from around the >>globe. It's the Cube with digital coverage of AWS reinvent 2020 Special coverage sponsored by AWS Worldwide Public Sector >>Hi and welcome to the Q Virtual and our coverage of AWS reinvent 2020 with special coverage of the public sector. I'm your host, Rebecca >>Knight. >>Today we have two guests for our segment. We have Kevin McCallum Jr. He is the chief technology officer at Maximus. Thanks for joining us, Kevin, and we have way. And we have Steve Zimmerman, who is the vice president of consulting services at Insight. Thank you so much for coming on the show. Steve. >>Thank you for having us appreciate it. >>So I want to start by asking. You both have to tell us a little bit more about your company's. Kevin. Let's start with you. Tell us a little bit more about Maximus. >>Yes, Thanks for having me. Maximus is a 40 year old company. We partner with state, federal and local governments to provide communities with critical health and human service programs. We leverage extensive experience to develop high quality services and solutions that are cost effective and tailored to their unique needs. One of the things that we do is offer government's ability to programs rapidly and scalable so that we can focus on the automation and their operations. We do services from Medicare to Medicaid, Welford work, and we have comprehensive solutions. Help the government's run effectively and efficiently. >>Great, Steve, tell us a little bit about insight. >>Yeah, sure. Um, Insight is a Fortune 500 company, you know, in 2020 will roughly do you know, probably a plus billion dollars in revenue. Global company. You know, we have thousands of treaty GIC relationships, but I'd say we have probably a couple 100 partners. We focus on one of those key partners to us is a W s. Right. As we go to market, Azzawi start, you know, working with our customers around transformation, of which we're gonna talk a little bit about that today with Kevin as it relates, Thio incite public sector. It's >>a pretty sizable >>part of our business. You know, we'll do about $1.5 billion in revenue. We have 200 plus contract vehicles, will work out there over 500 plus teammates, and we're seeing that business grow quarter over quarter, 20% growth. So It's a big investment for us and really looking forward to hearing Kevin talk about Maximus, uh, to the team, because obviously it's a big lever for us for inside public sector to get the word out there about the great transformation work. What you do with our customers. >>That's a great segue. So let's go back to you, Kevin, and talk a little bit about Maximus. Cloud transformation. Why did you hire insight for help you with this? >>Yeah, A Z We started our journey. One of the things we realized is as we were moving to the cloud is the experience. We needed a trusted partner and we ran an RFP process looking for partners out there that have done it that have done major data center programs. You're moving large companies, you know, We're moving about 6000 workloads 160 plus applications. So it was not a light or easy project and insight fit that. Aziz, We went through the interview process. It became very clear that they have done this for Fortune 500 companies in the past and their experience is beneficial to helping us drive to the future and the other factors is we wanted to make sure that once we were done with the project, we had the experience internally that they helped us with Thio drive forward. >>So talking about the importance of a trusted partner, which is such a key component of digital transformation cloud journeys tell us a little bit about the the strategy tied to the data center transformation and why you chose AWS. >>Sure. So, as we started doing our research, we did analysis across all of the cloud providers who were out there. AWS is clear leader in the marketplace. Their technology is better aligned with what Maximus has as the underlying technologies were, ah, majority of Lennox Base. We also have windows. We have Oracle, which, with the AWS depth on breath of our offerings, tied better to what we had. The other thing we were looking to do is get rid of our monolithic off the shelf products and use mawr of the cloud based products that are out there. Amazon has a very deep, uh, native technology that allows you to replace your old services where you had to bolt on or purchase another product to something that is integrated and streamlined, you know, down Thio, how do you monitor your systems? How do you do logs things like that. And, you know, as we looked at the time frame, we had to deliver this. They had to be able to grow with us. So as we were building out, new infrastructure were able to build where previously internally. With data centers, you have to buy infrastructure. You wait for it to arrive, you install it. Amazon has it at the click of a ah button. So we're able Thio basically have environment stood up in a day rather than having to wait weeks for it. So and the last thing was up time. So you know Amazon. They're five nines plus in up time and most of our contracts or three nines or better requirements. We had to find a bender that had multiple availability zones and regions that allowed us to be flexible in how we deployed. >>So talking about the convenience and the ability to streamline, and also the need for flexibility in the covert era. Of course, the word hybrid work environments has taken on a new meaning. But I want to ask you about how you see the hybrid era in the long term affecting Maximus. >>Yeah. Since Maximus is a government contractor, we will always be in a hybrid, uh, set up. So some of our contracts are very restrictive, especially when you get into our S d. O. D. And some of those agencies you have a fed ramp requirement is right. Well, with some of the federal agencies. So some of those components about to stay internally So where we can force, uh, you know, moving to the cloud because of the flexibility we have to deploy, that is the right will go. Um, co vid has introduced a new complexity. When it started back in March, you know, Maximus had 30,000 or so employees, and we instantly were thrown into You gotta make those employees get those employees to work from home. So we used Amazon's workspace Thio push our employees to work from home, where, you know, some of the employees and some of our contracts are customer owned equipment. So we couldn't actually take that equipment home. So we had to move to a B y o d model on Amazon workspaces in order to get the users to work from home and the complexity that, with what Amazon has to offer, allowed us to quickly move over 25,000 employees on the Amazon workspaces and work from home and then keeping the data center migration moving in the middle of it has also been, ah, challenge. So we will, in our federal space, still have internal data centers. Integration points that Amazon offers with their inter connects is key toe. How we make it a seamless process because we may have a business unit has stuff sitting in the data center and at Amazon, and they have to look at the seamless package. >>Steve, I want to bring you in here a little bit into this conversation. Cloud transformation, digital transformation. These are These are difficult and huge undertaking in the best of times. How does this pandemic this health crisis emergency. How has that affected the way you help your clients the way you work with your clients? Collaborate, communicate, talk a little bit about the effect of Kobe on this on the >>eso I would. I'll answer the question in a couple different ways, so I would agree with Kevin because, you know, forget about what we do with our customers. You know, we had a pivot really quick to write all remote workforce. You know, I think about my team, you know, 1000 plus teammates. Everyone's 80% travel all gone like, um, and I write eso everybody working remote. Everybody work from their homes. And but the challenging part was working with our customers. And, you know, I look at you know, I looked at with Kevin. You know, I've never met Kevin in person, you know, frankly, and there's teammates have come on to our to the project and execute executing this program remotely, so it makes it that much harder working with the customer. Um, you know, doing more video chats. You know, our methodology is built to be all remote. We have a proprietary tool called snap start that allows to bail scan environments. All that things done. Remote migrations could be done remote. The hard part is when you have to go on site because there's this stuff you have to go on site for around physical inventory to look at the equipment, but it just makes it that much harder. You know, I think he taking advantage of these video tools like we're doing today. You know, I can't tell me how many Skype You know how many calls have been on with Kevin like this and with his peers and with his leadership. But communication is really important program like this because, you know, in a program like this, there will be problems, right? And there will be challenges and, you know, getting on a call on being I will look at Kevin face to face and see what his reaction is really key. But you gotta work that much harder. You gotta work that much harder now in the pandemic. You know, I have other projects right now leaving with this other projects that, frankly, we have sold all remote and we're doing it all remote. And what I'm seeing with the bidam IQ is an acceleration of digital transformation. So, other similar projects like we're doing with Kevin. We're doing for other large fortune 500 companies because it's an acceleration of Hey, look, we gotta be old digital now, so it'll be interesting to see you know how the pandemic effects is long term because it is definitely accelerating out their digital transformation if you haven't done it, you're in trouble because it's gonna eat your company alive. >>Mhm. So, Kevin, he's talking. He talked a little bit about she talked a little bit about the importance of communication, particularly when work so many people are working from home. Um, talk a little bit of about other best practices that have emerged. Things that you have noticed. Things that you advice you would have to your peers. I mean, a Z we heard from Steve. If you're not there yet, you're in trouble. But for the for the people, for the executives out there who are watching this, What advice would you have for them? >>Yeah, I think that you know this this is brought to light. You know, there was always a view that you had to be in an office on a white board and actual actually functioning in that fashion. So, you know, before the pandemic, I was traveling three weeks a month on now, not traveling. I feel that I actually get more work done. I actually feel that I'm closer to the team just because we've introduced a lot of different digital channels. So now we have slack we have teams we do zoom. I require everybody to be on a on video, whereas previously before the pandemic you'd rarely have anybody on video. Um, and you've seen Ah, transformation is people pick up the phone a lot quicker than they did in the past. So it is, actually, I believe, brought the team closer together because now you know, everybody's on. Um, the downside of it is everybody's on all the time. So you've also had to have people step away from work because generally when they take PTO, they leave the office that go somewhere with their family. Now it's your kind of at home. There's not much to dio. You kinda have to force them to take the time off. One of the major factors that has has been interesting is we're doing this transformation in the middle of co vid with moving. All of our resource is the home. So we've we've had to take pauses, toe focus on getting everybody to work from home. Okay, now their work from home back to the project. And, you know, it's kind of a change the timeline a little bit, but in the end, you know we have some hard deadlines to meet. So it's been an interesting transition. You >>know, Kevin, um, I wanna agree with you two points is, uh you know, I think we're also getting not only your time, but also senior leadership, that I think, frankly, we never would have gotten, you know, I'm talking, you know, your peers and your leadership, Like I would fly for those meetings. I think about all the time that I've saved. But then again, it never ends, right? Never. It begins and never ends. And, you know, one of the things I'm concerned about is you know, the long term burnout factor for these folks because and depending on what state you're in, it never ends. You don't have anywhere to go, right. And you know, I think about teammates. I think you know, Kevin, I have talked about this related to our project like burdens and really thing right now for sure. 889 months into this thing. It's a real thing. Is people they have to focus on. Is is work sometimes. So it's a it's a concern for all of us is a project team is we start looking at the executing. This continue to execute this program for the next year. >>And it really highlights the importance of visionary leadership and a leader who cares who is empathetic, who is checking in with his or her team and making sure that the colleagues feel appreciated and cared for. I want you both to just give us look into your crystal ball is a little bit and talk about the where you see things 12, 24 months from now. Hopefully there will be a vaccine and we will return to somewhat of a of a new normal. Um, talk a little bit about where you see the Maximus transformation in two years. Absolutely. Yeah. Start with you. >>So s so you know, our cloud migration. We have some hard deadlines through next year, so we have a focus with insight to get that completed by September next year because our data center contracts are up and we've got to get out. You know, one of the the advantages of where we're headed is to move into more of a Dev ops model where you know you're able thio enable groups that have previously not been able to do work just do thio. The infrastructure was set up your now, enabling them to do deployments, get into production and have full stack ownership. That's really where our focus is. Is enablement of the teams that couldn't do the work previously because now you're in a different type of environment. Um, the other thing is being able thio be more agile. So as we move forward into the cloud journey, we as a company are consort contracts quicker. We are part of the, you know, contract tracing on unemployment insurance. We've done a lot of contracts with states that you know previously most of our contracts or anywhere from a 62 120 day startup. These contracts and contact tracing and covert projects. We've had to start them up in three days. That's having 500 employees online on workspaces on Genesis Cloud and fully functional, and it has been a challenge. But it also has introduced a a better way to do business because now we can we can move quicker for our customers and we can get contracts where they come and say, Hey, I need something in the next couple days. If you look further down the road. You know, it's taking the advantage of what Amazon has to offer, you know, moving from arm or monolithic programs like, you know, we sit on Oracle on Lenox today. You know, we could move into Aurora, which opens up the doors and floodgates, because then you manage, er a little differently. You manage your data a little differently. That's really where I think the the market's going and where we can actually transform our business. Even better, Thio, where we could be more flexible. We can start up quicker and, you know, be doom or things for our customers. >>The final word from you >>e I think it's gonna be a hybrid world, right? It's at least in the short term. And you know, we believe it's all about the workload and getting those workloads or applications, you know, in in the right spot, whether it be public or private and helping our customers with that journey, you know, just a pile on with Kevin talked about around Dev ops. Once you get a guy to get once you get all the stuff over there, you still got to manage it, Whether it's in a W. S or, you know, on Prem. You still gotta have a process to do that. So we see a lot of opportunity around the Modern I t operations and helping with that way. We want to continue to be a trusted partner. Thio Maximus. It's been a great relationship, but I want to thank Kevin and his his leadership team for trusting in us. And we look forward, Um, or more success with him in the future. >>Excellent. Thank you both so much. Kevin and Steve, thanks so much for coming on the Cube. >>Absolutely. Thank you. >>I'm your host, Rebecca. Night. Stay tuned. For more of the Cube virtual coverage of AWS reinvent with special coverage of the public sector.

>>from around the globe. It's the Cube with digital coverage of next level network experience event brought to you by Info blocks Hi ups to Minuteman and welcome to the Cube's coverage of the info blocks virtual event. Digging into the next level networking experience. I'm here with John Furrier, who is the host of the event. John. We've been talking about next level networking for for a few years now. Everything's multi cloud cloud native SAS adoption, really transforming the way that we have to think about networking. Tell us a little bit about this event. >>So as you know, yeah, again go back years from when member VM Ware bought in a sexual like Okay, you know that's going to change the game software to find networking. And we love that. We were all riffing on program ability. You saw the Dev Ops trajectory hitting networking. We would say that's where the action is on this event really kind of speaks to Info Blocks as a company which is really well known for DNS. I mean, they had cricket. Liu Stuart Bailey, that really kind of the pioneers in DNS and security have constantly been adding innovation to it, but DNS is one of those things where it's kind of like not thought about, but it runs everywhere, runs the web. It is critical infrastructure and, you know D HCP. We all know what that is. We have a home router, and then he got I p address management. These have been traditionally different things for enterprises, and everyone has it. They got to deal with it. And it's really, ultimately the location and how things resolved and connect. So you know, it really becomes a foundational opportunity to figure out where the access is not only a remote access, but security. So we had a great bunch of guests looking at looking at the info blocks. Next level networking, because they bought, had an acquisition, a Cube alumni snap route recently, and this caught our attention because they were doing Cloud Native. And one of the guests we had was Glenn Sullivan. He was the founder of Snap Route. He was the the guy who did all the Siri work for Apple. So this guy knows large scale of those cloud native We had kuna Sunni, who's the runs? Corporate development in all of the products for info blocks. He kind of went into the strategy of how they're taking the I won't say boring DNs, but the critical infrastructure of DNS and how they're extending the functionality with an abstraction layer around D D I, which is DNS DCP and management. And then we had some great guests on there. We had a Craig Sanderson from info blocks. He's on there. You'll hear from him. He talked about the security and then finally a customer who's running a big school district who, with Covert 19 exposes all these challenges around what has been called the borderless enterprise. So really, next level is that, you know, how do you deal with all this stuff? And that's been a big issue. So we're gonna unpack all that in this virtual event. We have four great interviews, and so it's going to be a great program. >>Yeah, John, as you said it to some of those foundational pieces of how network is done, a lot of times runs, you know, under the radar, something you don't need to think about. But all of these changes, as we said, you know my data. My network is now highly distributed, especially I would expect that the impact of the global pandemic and work from home are really causing even more of these challenges and to think about distributed infrastructure even more. So what are some of the themes we should be looking for here? How much of them kind of tie into what we've been talking about the last couple of years in some of these cloud native worlds? >>That's great questions to I'll get into some of the themes of the program, but you brought up the covert 19 again. We've been talking about this in our reporting. You've been doing a ton of interviews following all your your stuff as well as well as all of our team. Covert 19 really exposes the aspect of critical infrastructure, and to me it's like it's the It's the great I o T experiment happening in real time. It's forcing companies saying, Hey, the work. The future of work is about workplace. The location is now home workforce. Are the people emotional? They want ease of use. They want a different experience. They're all not in the office workloads and work flows. All of them have the common word working it so I think over 19 exposes this what I call I o t experiment because everyone is now borderless. It changes the game and really puts the pressure on security network access. And ultimately, you know, the bad guys are out there so you could have someone a teacher at home or a worker at home, and they get some malware attack and they're not sophisticated, zoom or whatever they're using for tools. All that's changed and they're vulnerable. So this brings up a huge networking challenge from whether even VP ends or even relevant or not to everything. So, to me, that is a huge point. You're gonna hear that throughout the commentary that that's kind of teased out. But the real things about innovation around the cloud you're gonna hear info blocks and they're experts talk about what they're doing and how they see cloud scale and cloud native integrating into an older paradigm like DNS. And to me, that's the That's the evolution of this DD I concept. That's an abstraction layer that creates innovation opportunities but also takes away a lot of the complexities around managing all the DNS things out there and again, that's the access of the network. It's a it's a place of truth is really kind of low level, but it's really foundational. So to me, that's the main theme. And customers want ease of use into it, whether they're at home or not, and replacing the old ways to putting a box out there. That's the way it was, DNs DNs. People would manage it all. Now they want to have it provisioned, managed a manage service cloud Native Cloud operations because it's only gonna get has to get that way. >>Yeah, it's interesting, John. You know, we watched the whole wave of software defined impact networking. I think of a company like Info blocks. They've been around for decades. They're dominant in the space is that they play in. Traditionally, it would have been an appliance that you thought of for their environment you talked about. They now have the snapper out acquisition as part of what they're doing. So it just what should we be looking for? What are they really the main point? That Info Box wants to bring people together for this next level networking experience? >>Well, Glenn Sullivan was one of my favorite discussions, and he's been on. He's a cube alumni and he's so smart. He came again from Apple. He knows that he knows what large scale looks like. Snap route was really early and was one of those technologies that just, you know, it has the core DNs built in kubernetes built in. They were doing some pretty aggressive, I would call it for lack of a better word kubernetes on bare metal. They were doing stuff, but really super cool kubernetes you combine that with DNS and info blocks actually has the core DNs that's actually in every kubernetes of in the CN CF. So everything that comes out of the CN CF from a core DNS standpoint is info blocks. So yeah, they're definitely relevant in the whole CNC of Cloud Native foundation, effort around cloud native. And as that scales just micro services, you're gonna have to have this new abstraction layer and also be compatible with automation. So that's, um, we didn't go into the weeds on that, but that was essentially the head room for all the different conversations roles of cloud native and open source technologies enabling borderless enterprises because you got to have the operation side and you got to have the program ability. So you start to get into the true dev ops that we used to riff on all the time. You know, move fast, break stuff to don't break anything. Right? So ops, ops and Dev have to come together. This is where the winners and losers of networking will be determined. You gotta provide the enablement for developers, but you gotta provide the stability of an operational checklist. >>Yeah, John, I guess the last question I want to ask you before we get to the guests, You know, that operational change, You know, we saw for so many years it was, Oh, all the networking people, they're going to have to learn to code up weight. Dev ops is actually gonna spreading the information around. And maybe I won't need a particular networking team. But we understand when things go wrong, you've gotta have somebody with the expertise that could be able to dig in. What are you know, who should be listening to this? What are some of those organizational implications for what you're talking about with info blocks? >>That's a great point. I mean, the biggest challenge that I see in all this entire digital transformation as it starts to get down into the cloud native world is, most people are asking the wrong questions. They don't even know what they're talking about When it comes down to trying to compare an apple to an orange, they're really kind of disconnected on language. You got server people in networking. We know that they have different languages, and working together is key. When you think about something like DNS, that's a technical. That's an operator that's an I t person, that someone who's running critical infrastructure. But when you start to think about the security aspect of it, it's a CSO conversation. So what I'm seeing come out of this that's critical, is when you start to get into this cloud native world. You have more stakeholders in the value proposition of all this and with covert 19. As I pointed out, you know you got hacks and you got security. So when you talk with security, that's up and down the organization. That's the CSO down to the teams themselves. We have about automation horizontally scaling with Dev ops. That's multiple teams, so you have an integration kind of stakeholders. You know DNS servers, all networking. All these people have to kind of come together. So the people who should watch this are the people who are concerned about scaling the modern enterprise, which is borderless, which is code word for multiple access points and multiple connection points. R i o t um, how do you make that work? And that's the real challenge. So it's kind of like an I t a person who wants to figure out where the puck will be so they could be there when it's there and skate to where the puck is, as we say, and and the CSO of the senior people have to understand that DNS cannot be overlooked because whether it's a managed service. So So Cloudflare had a huge out into the DNS. Setting DNS takes down everything. So it's ah, it's the most fertile ground and the most targeted ground for attacks, and that is well understood. So getting the right questions in place foundational we had to set up the modern enterprise, and then that's going to be a construct for the cloud native architecture and ultimately the developer environment. So yeah, it's a topic that's kind of nerdy with DNS, But it has implications across digital transformation. >>Jonah expecting lots of conversations around security and automation how they tie into all of the modern and modernization themes. Absolutely some pieces that shouldn't be left behind. All right, John Ferrier, Thanks so much for helping us kick off. Really interested. Make sure to stick with us off to listen to all the guest interviews here that John has done the info blocks. Next level networking experience. Instrument, man. And thank you for watching the Cube. Yeah, yeah, yeah, yeah, yeah, yeah.

>> Narrator: From theCUBE studios in Palo Alto and Boston, connecting with thought leaders all around the world. This is a CUBE conversation. >> Okay, welcome back everyone, it's theCUBE's virtual coverage of AWS Summit Online, they're virtual. Then I'm John Furrier, your host of theCUBE. We're here in our Palo Alto studios for theCUBE virtual. We're remotely doing interviews during this COVID crisis. We have our quarantine crew, we're doing our best now for two and a half months getting those stories out, and today is AWS Summit. It's going to continue online, it never ends. It's virtual, it's asynchronous, but more importantly, let's get to great content. Our next guest Jimmy Chen, CEO of Propel. Great entrepreneur, vision with real impact and this is a story that is super important in my opinion, because it's a tech story and it's a social impact story. And you don't have to do one or the other, you can do both these days. This is going to be great. Jimmy, thanks for spending the time with us today. >> Yeah John, thanks for having me on the show. >> So, I want to get into the broader entrepreneurship and social impact as an entrepreneurial thing, which I think is a total awesome opportunity. But, you guys are using AWS for good, Propel, Take a minute to explain Propel the company, the things you're working and what you're passionate about. >> So Propel, we're a tech company based in Brooklyn that build software to help people navigate safety net programs like the food stamp program. There are about 40 million Americans who get their food stamp benefits on a debit card, called an EBT card, which looks kind of like a debit card or a credit card you get from a bank. But, when we spent time talking to people who use these cards to buy groceries, we actually found that it has kind of a weird quirk, which is that everyone who goes grocery shopping with an EBT card has to call the 1-800 number on the back of the card first, because that's how they can check the balance. And if you try to check-out at the grocery store you don't have enough left on your card, you get into this really embarrassing experience of having to decide, do you want three apples or two, and trying to figure out how to get your balance to be appropriate for the amount of food they're trying to buy. And so, we actually found that this pain point of needing to call the 1-800 number to go check your balance on your EBT card is a really common one that's felt by all 40 million of these Americans who use the food stamp program to put food on the table. So, what be built at Propel is really simple, it's a mobile banking app for the EBT card, the same way that you have a mobile banking app or your banking product, that we've created a digital free app that allows someone who gets their food stamp benefit on an EBT card to check their balance, to see their transaction history and more broadly actually to improve their overall financial help. >> And mends also the quality of life, knowing confidence whether whatever they're going through, that's something they're going to feel about as well. Talk about the tech piece of it. Obviously, this is a good example of something that I've been really riffing on for many years now, and just trying to get people's attention to is that cloud computing changes the game on social impact, because the time to get to the value, which is well talked about in entrepreneurial circles, later got funded, I got product market fit, applies to anything. And this is really spawning a new generation of entrepreneurship. This is a real thing and Amazon does that. What's your experience with AWS in this area? >> Well, our experience over the last month and a half in the middle of the COVID crisis I think has really driven home the value of AWS for our business, which is that, you know, at the start of COVID we had about 2 million people who used the Fresh EBT app on a monthly basis to manage their existing SNAP benefits. Unfortunately, as the economy has worsen and people's usage of safety net services as has increased, so has our userbase. And AWS has been really key to us, being able to scale our services, to be able to help an extra million people start using the Fresh EBT app essentially over the last few weeks. And so, you know, to your point about infrastructure and scale and technology, for us it's really been about, what are the best practices in the consumer tech worlds? And how do we apply those to help people that are lower-income and generally deal with experiences that are less good. >> You know, I've talked about though is something that I've been really talking a lot about, and maybe I'm a little bit older, but the younger entrepreneurs, they love to be agile and everything else. But what you're doing and what you've done is really have agility, but when you have these hard times everyone uses the word pivot. Which I hate that word pivot, it means to me like, it didn't work out, I'm going to pivot to something else. But to me, I think what's available when you're using the cloud, like what new position you're in, you built an app for a use case, you had product market fit. This COVID crisis becomes a tailwind for you, because actually your app helps people that are in need, but it also might give you an opportunity to do other things really fast, which means jump on an opportunity, not necessarily pivot. I mean is that tacking, pivot? It's kind of semantics, but it's a cultural mindset. And I want to get your thoughts Jimmy on how you see your business changing where you can actually take what you've built on the trajectory in the climbs of scale, the steep learnings. And then also take new territory down, whether it's a new service, helping people in need, 'cause that's the mission. Now you have flexibility. >> Jimmy: That's right. >> Talk about how you think about that, and what are some of your opportunities that you see. >> Jimmy: Well, the reality is that financial life for people who are low-income and using safety net services changes rapid. And there's no better example of this over the last, you know, few decades than the COVID crisis. Over the past few months, people who are using food stamp benefits have had really an unprecedented challenge over the last few months. It's been tough for everyone, but our survey data shows that for people who were getting food stamp benefits and working in early March, 86% of them have now lost some source of income, or have had their hours cut. And so I think one of the things we're starting to hear from our users is just the unprecedented type of need that they're facing and that they're turning to apps like the Fresh EBT app, to help them to navigate this particular crisis. To answer questions like, "What are the nutrition programs "through the government that are available to me? "How do I get a stimulus check? "What about the unemployment program? "And just, what are the full set of safety net resources "that are available to help someone like me "to get back on my feet and to make it through "this unprecedented financial hardship?" So, to your point about pivoting, you know, it's not necessarily, I don't think of it as pivoting, I think of it as like as responding to the real changes in user need. >> Yeah, ceasing opportunity on your position of your value proposition. Jimmy talk about the company, that your company launched a new service, Project 100. What is that about? Can you take a minute to explain that? >> Project 100 is a partnership between Propel, Stand for Children and the GiveDirectly team, which is the other two are nonprofits that are focused on different aspects of serving people that are in financial need. And it is a partnership that we've created to raise a $100 million to be able to make cash transfers to a 100,000 people who use the Fresh EBT app and are in financial need. So, Propel's role in this is that we, because our app helps people that are getting their food stamp benefits, we can certify that this is a person who is in financial need and uses, essentially, the status on the food stamp program as a proxy for, this is a family who really needs help to get through this crisis. We've been fortunate to have a lot of donors who are very generous and interested in finding ways to support, you know, people that are going through these types of financial hardships. And so, we've been fortunate to raise already about $70 million through this program. But, I think we still have a ways to go to reach this $100 million goal, where we really think that, that was a material impact on helping low-income Americans weather this financial shock. >> Well, I really appreciate what you're doing and thanks for what you're doing, it's great, and I think it's a great opportunity. Got great product market fit and you got a lot of horizontal opportunities to go after as you're more successful. I also want to get your thoughts real quick on tech entrepreneurship. It's been very glamorous over the past couple decades, to be an entrepreneur, but ultimately it's about creating value. I think, you're seeing with the cloud a lot of opportunities that aren't the traditional, you know, go public, built, raise a bunch of money, really either for profit or nonprofit, really in highly social impact situations. This is a growing field and you're doing it. Can you share what you're seeing and what advice you could give folks who are really thinking about having a mission driven opportunity. >> Jimmy: Well, I think that people solve the problems that they understand, and that traditionally tech entrepreneurs understand the very specific set of challenges, because the demographics of tech entrepreneurs are a smaller set than the overall population in the United States, right? Tech entrepreneurs tend to be male, they tend to have a college education, they tend to live in cities like San Francisco or New York City, and they tend to have a lot of money. But the reality is, that's not the demographic of people who use technology in the United States and so if people solve the problems that they understand, whose going to solve the problems that people on food stamps understand, if there are not a lot of people who are on food stamps that are starting their own software companies? And so I think the power of tools like Amazon Web Services and the cloud that allow people to be able to create new technology in a record amount of time and scale that, is the ability to democratize who gets to build the technology that people use, right? It means, both being able to help people who traditionally would not have the resources to start a new type of organization, to start a new one, but it also means being able to help companies like mine identify these types of challenges, to learn about the needs that people who are low-income have and be able to scale a product. >> Phenomenal mission Propel. Jimmy Chen, CEO of Propel. If you're designing a product, or art, or anything, you got to know who you're designing it for. And great point, and people solve problems that they understand. Thank you for what you're doing. Congratulations and continue success. We'll keep in touch. Thanks for coming on the virtual CUBE, thank you. >> Jimmy: Thank you so much for having me John. >> I'm John Furrier here on theCUBE for theCUBE virtual coverage of AWS Summit Online. A virtual conference has gone a way to virtual, so is theCUBE. Until further notice, we're going to do our part in our studio in Palo Alto, the studio in Boston. Checking in with folks and getting the updates. We're all in this together, and I'm John Furrier with theCUBE. Thanks for watching. (bright music)

>> from Austin, Texas. It's Theo Cube, covering your storage. Accelerate 2019. Brought to you by pure storage. >> Welcome to Austin, Texas. This is the Cube. Live at the fourth annual pure accelerate. I'm Lisa Martin with David, Dante, Dave or in Texas, >> Texas again. >> Austin, Texas. Very interesting venue for this fourth annual hear stories. >> A lot of construction, >> music, a >> lot of music. >> So we just came from the keynote and news announcements, customers on stage. But the first thing to point out is, this is here is about to celebrate their 10th anniversary. Charlie Giancarlo, CEO and chairman who's coming on the program with us, and just a few minutes talking about what they have innovated and delivered these 10 X improvements and 10 years kind of this overnight success in 10 years and what's coming? What was with the things that really stuck out at you, Nicky Note. >> Well, first of all, ironically, this is the 10th year of the Cube, not our 10th anniversary, but it's the 10th year of doing the Cube. And so our fourth year, I think it's pure accelerate about what 3000 people here, >> you know, the keynotes >> pure was laying out what their vision is of the modern data experience and that I felt like the keynotes least there were sort of, ah, speed date of what's coming. There was a couple of major announcements that we'll talk about, >> Uh, but >> they really are trying to differentiate as the modern storage company turn a deep position. The competition, as the old guard is to use this term that Andy Jassy uses pure, didn't use that term. But they really talked about it's time to go Modern. And so they were an overnight success. It took him 10 years, was one of the comments that was on stage. So I think this is worth pointing out. A couple of things. I mean, let me lay out. Sort of my thoughts on Pure is a company. They were the only storage company Ah, in the past. Let's call a decade to reach what I'll call escape velocity. They achieved a billion dollars a couple years ago. They're doing their due about a billion and 1/2 on a trailing 12 month basis. They'll do 1.7 billion this year and evaluations about 4.5 billion. So they got a a three ex valuation in that fluctuates. That's pretty good for a storage company. Billy on Lee major storage company. That's really growing rapidly. They got 28% growth. I did a breaking analysis on Lincoln, and I'll just share with you some of the numbers. Dallas flat at 0%. So Del is actually gaining share with no growth has got a scary NetApp minus 16% in the quarter H P E minus 3% IBM minus 21%. And so it is pure A 28%. So they're really crushing it in terms of growth. They've also got a 69% gross gross margin, even if it's in its heyday. E emcees gross margins weren't that high, you know. They were in the sort of mid sixties, and so, and they've also got a good balance sheet. About a billion dollars in cash A little. A little more than that, they got some debt. They're shifting their model to a deferred revenue model. Now the only thing is, you know they're growing much, much faster than the competition. But they're throwing off a lot less cash because they're much smaller. Just as an example, they probably throw off 5 to 6% of their revenues in cash. Netapp probably throws about 23% of its revenues, often catch the big Delta there, so the point is long winded. But but pure storage is in growth mode. And until the market rewards more consistent with a cash flow, they're gonna, I think, stay in huge growth mode. >> There was a great analysis. Dave and I saw an analysis that you did with some spends data, just a couple of your reverence. A little bit of that. There's there seems to be a tailwind behind here you mention the 28% wrote that they announced in Q two, and some of the things that also they talked about were there. Adding about in Q two of F Y 2020 about seven net new customers every business day, adding about 450 new customers just in that quarter. Like you said, 3000 folks expected here today. The momentum is behind them, but they're also a company of firsts. You talked about this a number of times. The first, with all flashed the first with envy me on the back and a couple of additional firsts announced today. Talk about the as a service model and how that youth, in your opinion, you think might continue that trajectory that they're on. >> Yes, so basically pure laid out today, said that vast majority are Pouliot Portfolio is gonna be available as a service. That's the cloud consumption mall is important because pure has about $600 million in deferred revenue, largely coming from their evergreen service. But there they are, slowly shifting their model to a subscription model. It's gonna be very interesting to see how that plays out. Um, we've seen a number of companies do a tableau in Adobe kind of pulled the band Aid off and did it Splunk has taken years to do. It will be interesting to see how how pure goes. For that. I'll >> bring it >> back to the cloud up yours largely an on Prem storage company. That's where most of the revenues come from. But we heard the gentleman from Amazon today. I think it was E ethan whiner, not Ethan, anyway, Mr Whiner, he said. That gardener did A survey last year showed 88% of customers said they have a cloud for a strategy, but 86% of those customers continue to spend on prim. So here you have the cloud. Amazon gorilla wants everybody to go to the cloud pure would much rather they make much more money on Prem? But they realize customers air pulling them in. So they have to move to that as a service model. One of the interesting things that pure is done, which, you know, that's not really a first. But it certainly is for the large storage companies they've announced. Ah, block storage on AWS. So basically what they're doing is they're taking the pure experience. It all looks like pure software, and they're front ending cheap s3 storage from Amazon with E. C. To compute instances, and they've architected using Amazon service. Is this basically a block storage array in the cloud so Amazon gets paid, pure, gets paid? It's a little bit of a premium, but you get higher availability. You get great right performance and you get the pure cloud experience pretty interesting strategy, >> and they're talking about it really as this. This positioning it rather as a bridge, a bridge to hybrid cloud. This numbers that the Amazon gentlemen, share that you mentioned Gardner were really interesting both sides recognizing there's a forcing function there and that forcing function is the customers from the enterprise to the small business who need to have data available immediately wherever it is people to extract this insights from it quickly so that those companies, whether it's a capital one or a Delta Airlines or a smaller organization, can act on it quickly to Dr Competitive Advantage. Same kind of challenge that your storage has. But really that forcing function of the customer, clearly bringing the giant AWS together with yet another story >> so pure as they say reached escape velocity. They and Nutanix were the only on a new entrance that reached a billion dollars Nutanix. I really don't consider a storage company. They're kind of hyper converged. And the way they did that as they drove a truck through E emcees install base with flash. So they were the first within all flash array. Maybe maybe they weren't the first, but they were the first to really drive it. They hired a bunch of DMC sales reps. They knew where all the skeletons were buried and they really took out a lot of old Symmetric Se's and Claire eons and V. Max is and all the old sort of GMC install base, and that helped them catapult their way there 1st 10 years. Now they got to do that again. They got to get to get They're on their way to two billion. But how did they get to five billion? Um, and and so the way they do that is they have to expand their tam. I mean, we'll talk to Charlie Jean Carlo about this. My feeling is a big job of the CEO is to expand the Tamil. How do they do that? They go after new workloads like a i. They go for cloud. They go from multi cloud. These are all very large markets in which they don't participate. Data protection. They'll partner with Lex, Kohi City and Rubric and Beam to to have data protection software running on their flash. A raise with very, very fast restores. That's something that's taking off. It's gonna be really interested in seeing as they say, they've got this subscription model that's coming in. They've got all this deferred revenue that in a way, it's going to slow him down a little bit just from an accounting standpoint, cause when you recognize deferred revenue, you recognize that, you know over 12 months over 36 months, so that's a little bit of a transition. The other thing that pure is facing in a tactical basis is Nande pricing. It's like this countervailing effects nan pricing is coming down, which means lower prices, lower costs but also lower revenue. But at the same time, it becomes more competitive with spinning disk. This is something else. We'll talk to Charlie Jean. Cholera right about it opens up new markets. So this tam expansion is critical for pure in terms of driving this modern data experience into these new workloads and fighting the competition, the competition is not sitting still. All those companies that I mentioned the H P ease, the the Delhi emcees, et cetera, are basically taking a page out of your swords narrative, talking about the cloud experience, talking about, you know, flexible pricing models, building cloud products on prime and hybrid cloud and multi cloud. So it's hard sometimes for customers to squint through that. And really, no, I guess the bottom line, the last thing I'll say is pure. Doesn't have as many feet on the street is these other guys. So it's gotta leverage the channel increasingly, and that's how it gets beyond two billion on its way to five billion. >> And that was one of the factors that they attributed the second quarter. 28% year on year growth is to not just innovation, but also to the channel. So they've done a good job of really pivoting. There's large enterprise deals to be covered, direct and then bringing in the channel for those smaller mid size business customers. Adding a lot of momentum in cute to you mentioned the nan pricing that in some of the political climate with the start of China, most of their businesses in the Americas so they're not facing as many of those challenges. So they did lower guidance for the rest of it is >> the second time they've >> lowered 20. However, they kind of attributed that thio the nan supply oversupply and they say happy Matt to flatten out quickly, say they're >> not worried about the macro. I mean, look, if if the economy is good and is booming and people are spending money on cap ex. That's good for even a high growth company. They're basically positioning to the street that if if the economy does turn down and there's a softness at the macro, they'll actually gain share more rapidly. Which, by the way, is probably true. But look at the rising tide lifts all boats. Nobody wants to see Ah recession. Having said that, well, it's interesting. When you saw Pure Lower, its guidance stock took a hit, and then net app, I'd be him. All these other company you have to see a deli emcee they announced in the market said, Wow, pure must be doing really well compared to these other guys. So it's come back in a big way. My opinion pure is going to in the e. T. Our data shows this from a spending intentions Pure is going to continue to gain share at a much, much more rapid pace of the other. The other guys, from a product standpoint, delicacies consolidating its product portfolio, trying to lower its cost. H. P E is really focused on limbo. IBM needs a mainframe product cycle to get back going, Ned APS facing its challenges and its kind of tweaking its go to market model. So all these other companies air dealing with sort of some structural changes. Where is pure is like put the put the foot on the gas and accelerate no pun intended. And so I think they're gonna continue to gain share for quite quite a number of quarters. >> I want to talk about sustainability before we break. And one of the things that Charlie talked about on his keynote is in terms of the modern data experience, he said. It was three things. It was simple, seamless and sustainable, an inch sustainable. You really started talking about the evergreen model that they launched a while ago that seems to be really sticky with organizations. He also talked about sustainability is a lot of other organization I need to adjust in terms of, you know, waste and carbon emissions and things like that. But I'm just curious, since Pierre is much smaller than the competitors that you mentioned and a lot more focus, obviously all in on flash. Where does the evergreen model, in your opinion, give them that tail winter? That advantage? >> Well, the Evergreen model was first of all brilliant marketing strategy and a business strategy Because if you think about the traditional storage vendors, they make so much money on maintenance, they would never have done this unless pure force them to do it. Because they're making so much cash on the maintenance. You know, it's it's you. You put the storage array in and we're just gonna charge you maintenance. And if you're not on the maintenance contract, sorry. You don't get all the software upgrades, everything else. So it's just this, you know, this lock in strategy, which is work brilliantly for two decades pure, comes along and says, Hey, where? Software driven. We're gonna allow you to get all the modern software. As long as you're got a subscription with us, we'll swap out your controller for free. You know, the competitors hate that. There's all kinds of nuances and stuff, but it worked, and customers love it. And so it's very strong, and it's a fundamental as they said, they got $600 million in deferred revenue, largely from that evergreen model. So they, you know, Charlie mentioned first for non disruptive upgrades. First for cloud management, first for a I ops first for always on que Os first with always on encryption, and if they're really the first, we're probably the first big company. They got a lot of attention there. Last thing, it's it's a four big announcements today. There's a I ready infrastructure, airy. They're doing some stuff they were first to announce with video. You know, a year or so ago, they got cloud offerings. Ah, block storage for AWS. And they've got clout Snap for Azure, which is actually pretty hot. It's backup on Azure, and they got product extensions. They got cheaper flash with a flash or a C for capacity. And then they have extended their all flashy raise their flash played etcetera with storage class, memory and and storage memory. And in this, this as a service model. Those are really the four big announcements that were gonna dig into all this week. >> We are, and we're gonna be talking with This is a great event. Two days. The cube is going to be here. We have seven pure customers to talk to you that I think kind of a record, at least in my cube experience of the last >> AWS always puts a lot of customers up too. You know. All >> right, well, there's no better validation than the success of a brand, whether we're talking about Evergreen or their first or the reaction of the market to bringing flash down to satya prices. So excited to dig into customer stories with you, Dave. Course we'll talk to some partners who got c'mon slung Cisco somebody else and probably forgetting. And, of course, some of the pure, exactly gonna be exciting two days with you and looking for two days >> looking forward to at least a great >> all right stick around. Dave and I will be right back with our first guest, Charlie Giancarlo, chairman and CEO of Pier Storage. Stick around, come back Mawston in just a minute.

>> Announcer: Live from San Francisco, celebrating 10 years of high tech coverage, it's theCUBE. Covering VMworld 2019. Brought to you by VMware and its ecosystem partners. >> Welcome back to bright and sunny San Francisco. Gorgeous day here in the City on the Bay. Dave Vellante, John Walls. We continue our coverage here on theCUBE VMworld 2019 with Doc D'Errico from Infodant, CMO. Doc, good to see you again, sir! >> Infinidat. >> Oh Infinidat! Sorry, sorry, sorry. (Doc laughs) But, good to see you! >> I missed my opportunity but thanks, Dave, yeah, it's good to be back. >> John: You bet. Marc Creviere, who is principle systems engineer at US Signal. Good to see you again, Marc here. You were here just last year, right? >> Yeah, I'm an alumni now. >> We'll touch base on that in just a little bit. Doc, first off, let's just talk about the show from your perspective. What you're doing here, explain to our viewers at home what it's all about and what you find the vibe that's going on this year. What kind of sense do you get? >> The vibe is fantastic The sense is great. Coming back to San Francisco, I'm not sure what we were really expecting but it's a really good tempo, a lot of great people, lot of great feedback on our recent launch. A lot of people looking at what're we doing, especially with VMware and availability. Lots of new use cases for snapshot technologies which is fantastic. The 100% availability, it's great getting people come up to you who say "Hey, this is incredible. "You guys actually put some teeth behind your guarantees," "you know, you're not just promising "some future discounts or something. "In the VMworld environment where I've got my VMs, "I need that kind of guarantee, I need that support. "I need to know that my systems "are going to be there when I need them, "because that's my business," right? It's just an incredible vibe. >> And had your party last night? >> We had our party last night. And guess who was there? (laughs) >> I did stop by, it was a very cool venue. The San Francisco Mint, which is, it was kind of awesome. >> Yeah, it was a great, great environment. It was great having people like Dave there, and some of the other industry luminaries talk to our customers. >> I didn't get the tour of the Vault. >> Doc: I'll get you a picture. (laughing) >> So, Marc, I mentioned in the intro, we had you on last year. So, let's look back at the last 12 months for you. US Signal, and what's been going on with you, and what are you seeing here and kind of feeling here in terms of business? >> Yeah, thanks for having me back. It's been another great year at US Signal. We are planning on opening a new data center in the Detroit Metro area, coming up online Q1 of 2020, so that's exciting for us. Purpose built, wholly owned and operated by us, so that's great. It's going to add to our capabilities in that region. We've had a heavy focus on DR technologies, DR as a Service technologies in the past year. Seeing a lot of success, a lot of really good conversations with customers and developing their plans, and bringing our new capabilities to be able to service those needs. >> So, tell us more about the DR as a Service. I mean, that's obviously one of the early sort of cloud-use cases? >> Marc: Yeah. >> Add some color, what is it all about, how does it relate to some of the other DR solutions that are out there and what role do these guys play? >> Yeah, well we conducted a survey of a little over 100 of companies in our region, a little over 100 respondents, and three out of four respondents told us that their biggest concerns were either distributed denial of service or ransomware. Obviously, we've got these bad actors out there. And it doesn't necessarily have to be a bad actor, it could be something force of nature making data unavailable, right? It doesn't matter how great the equipment is if either a bad actor or nature takes it out for you. So, having that protection, we're able to have replication technology. We actually have three separate technologies that we use now. We enhanced our Zerto-based offering to include multi-cloud so we can now have customers replicate to either multiple cloud destinations, us being one of them, or they can replicate to one of their sites and us as a tertiary site, so that's new. They're able to bring their existing licensing. One thing that's exciting to me, near and dear to my heart, is drafts for VMware based on the vCloud availability platform. So, we're a big VM, vCloud shop, big consumer of VMware technologies, that's why we're out here, and that's really exciting to me because it uses built in VMware replication technologies. There's not a lot of learning curve, there's not a lot of extra components. Super simple to get up and running and get RPOs as low as 5 minutes, and it's easy, and it's relatively cheap on an OPX-type platform, where you're paying for storage and per VM and that's it. And then we've also spun up a replication for Veeam, Cloud replication for Veeam based on that ecosystem. So, we've got a lot of entry points, a lot of different ways that we can protect that data and bring it in and get a copy in our data center, so in the event that it becomes unavailable at the source, it's either managed or customer managed. We can get it up and running in a short time frame on our infrastructure. >> And Infinidat is the primary storage underneath all this? >> Marc: Yeah. >> So, explain more about... So, Doc, you and I have had these conversations. The state of the art, whatever, 15 years ago, was three-site data centers, very complex, extremely expensive. I'm interested in how we're attacking that problem today. You obviously, with multi cloud, it's multi-site, but how are we attacking the cost problem, the complexity problem, the "I can't test because I can fail over "but I'm afraid to fail back" problem? >> Well, you know, there's so many different ways to cover all of these. We're talking just about ransomware, you know, ransomware are immutable snaps, become an important play and we have Snap Rotator which will allow you to build a certain number of snaps and have them just rotate through so you're not just creating an infinite number, you're not wasting time and space. And, by the way, time and space, our snapshots are zero-overhead. There's zero performance penalty, unless you want to crash consistent copy, and there's really zero data overhead because it's only the incremental data that you write. So, by creating this, you can do it every couple seconds, and then create some immutable copies of that. You know, make them time out, so they can't be modified, 30 days, 60 days, whatever you decide administratively. So that's great. If you're looking for the DRaaS, the DR as a Service-type capabilities, whether it's single site or multi site, going to cloud service providers makes a lot of sense. 'Cause now, even if it's on premises to a cloud service provider, now you're not having to worry about that second set of infrastructure, you're not having to worry about the management of it, you're not having to worry about the systems integration of it, or even go CSP to CSP, right? Go from one data center within your favorite cloud service provider, hopefully US Signal, to another or any one of our great partners would be super, too. And then, of course, InfiniSync, where if you really want that longer distance capability, why bother with a bunker site? Why bother with all that complexity and that cost and overhead? Put in an InfiniSync appliance in with a VM, and you've got the recoverability. You can go asynchronous distances, and have a zero RPO. >> For way, way less. >> Oh, a fraction of the cost. It'll cost you less for the InfiniSync appliance than it'll cost you for the telecoms equipment that you need for a bunker site. >> If I don't want to build another data center... Go ahead. >> What I'm curious about; I heard a number yesterday in one of the interviews we had, about ransomware. The number kind of blew me away, and I thought about one out of every three companies will be a victim of, or at least a ransomware attack within the next two years, which means everyone, over the next six, if you extrapolate that out. Does that sound about right from what you're seeing? That the intrusions are reaching that kind of frequency? >> I'm surprised it's that low, but I'll let Marc try and answer that. >> We've done some events where we actually demo how easy it is, like, through a phishing attack, to get that in there. So, it's not just about having those protections in place, it's your user training; that's a huge area, training those users what to look for in those emails to avoid that sort of thing, but it's not perfect. People are imperfect. >> Dave: And yeah, you got to have both the protection on the front end, the training for the people, and those recovery options in the event it does get in. In our survey, the average monetary damage was over $150,000 per incident. And that means that some people got off a little lighter and some people paid a lot more, if that was the average. >> Should you pay the ransom? >> Uh, not if you've got a good plan in place that can test it. (laughs) >> But it is, it's a reasonable question. >> Huge quandary. Some are, some aren't, right? Atlanta says "no, we're going to pay a boatload "to protect against it, but we're not going to pay that," what was it, 55,000 or whatever it was? >> Let's negotiate. >> Yeah, I think I said last time I was here that until you've tested your plan, you don't really have one. You know, it rings just as true today. >> What's your business worth? I mean, it's a great question, really. What is your business worth to you? Your business is probably worth a lot more, and they probably throw these numbers out there, thinking "Well...", then becomes a no-brainer for you to pay, and that's the whole point. Because what is ransomware? It's malware that's recoverable, maybe. You're not even sure of that. >> Is it usually, is it operator error? Is it human error that allows that to work more often than not? Or, is it a mixture of technical chops, or just...? >> It's a mixture; you've got to know what vulnerabilities are out there on your infrastructure, you got to make sure you're staying up to date on patching those vulnerabilities, paying attention to any compliance practices, if you're a compliant organization. You know, HIPAA, PCI, our entire infrastructure footprint is actually HIPAA and PCI compliant at the levels that we control. So, it's a heavy lift. You got to stick with it. >> But just to kind of bring it full circle to the comment about the ransom and paying it, you know Marc said something really important, "Have a good plan." I would argue, have a good partner. If you don't have a CISO who's got the chops to be dealing with these types of problems, that's when you need a partner like US Signal to really step in and take you through what's involved in a realistic plan, something that's not going to break the bank, something that's really going to protect your business going forward, because these things are very real. >> One of the concerns I have in this topic is that things happen really fast these days. So, if there are problems, they replicate very, very quickly. How do you address that problem? Is it architecture, analytics, I'm sure process, maybe you could add some color to that. >> All of the above. Having those controls in place, those segregations, we've got, obviously, clear segregation between our management and customer data plans. And each of our customer data plans are separate from each other. It's secure multi-tenancy, not just multi-tenancy. So yeah, it's important to keep those delineations, user access, making sure that people only have access to what they need, and a lot of that, again, is covered by those compliance practices and paying close attention to what they have. There are reasons they have these guidelines and these rules and these audits. It's to help, in large part to protect against that. >> You mentioned before, Marc, you're a heavy VMware user, Infinidat, it's kind of the new kid on the block. People said "Oh, they'll never be--" >> Marc: Not for us. >> What's that? >> Not for us. >> Not for you, right, but for the storage industry. Doc and I have been in the storage industry a while. But, I'm curious as to what you want from a supplier like Infinidat, why you chose Infinidat? How're they doing with regard to VMware affinity, all those things people tend to talk about as important. >> Marc: All right, well-- >> What do you think is important? >> Well, in the Infinidat experience, the company experience, the support experience, it is the benchmark by which we judge all other vendors now. It's that good. The working with us whenever we need equipment, obviously they've got, the price per terabyte is hard to beat with the way they're able to leverage that technology. The responsiveness, if we've needed something in a hurry they've been able to get it to us in a hurry, It ties in extremely well with our infrastructure because we scale so quickly, right? Trends are very hard with us, because there's all these hockey sticks. It's going, going, going, we get a big order and it goes up really fast. I think the theme right now is scale to win? >> Yep. >> So that resonates with us because by having that in place and having that scale ready to go, we don't even need to anticipate those hockey sticks because it's already there. >> Great. Well, gentlemen, thanks for the time. We appreciate that. Doc, Infinidat. (laughs) >> Thank you very much it's great to see you both again. >> John: Look forward to see you in 2020, right? >> I'll be back. >> Yeah, it's become an annual thing. >> Michael said we'll be celebrating our 20th year, so I'm looking forward to seeing-- >> And this is our 10th year here, so anniversaries all across the board. >> Congratulations. >> Congratulations. >> Have a good rest of the show, we appreciate the time. >> Thank you very much. >> Thank you. >> Back with more VMworld 2019, we continue our coverage live here on theCUBE. We're at Moscone Center North in San Francisco. (upbeat electronic music)

>> Announcer: Live from New York. It's the Cube. Covering AWS Global Summit 2019. Brought to you by Amazon Web Services. >> Welcome back rush hour's started a little bit early here in New York City with over 10,000 people in attendance for AWS summit in New York City. I'm Stu Miniman, my co host for today is Corey Quinn. Happy to welcome to the program two first time guests from our host, Amazon Web Services. To my right here is Deepak Singh, who's the Director of Compute Services. Sitting to his right is Aaron Kao, who's the Senior Manager of Product Marketing. Gentlemen, thanks so much for joining us. >> Thank you for having us. >> Thank you for having us. >> Alright, so we know that every day we wake up and there's new announcements coming from Amazon and the only way most of us keep up with it is trying to read Corey's newsletter here. But in your group in compute, we know there's a lot going on and quite a few announcements. So Aaron, why don't you kick us off with some of the hard news that went through this morning? >> Yeah, we just launched Amazon EventBridge. It's a serverless event boss that allows you to connect your applications with data from sources like SaaS applications, AWS resources and your own applications. >> All right, so Deepak, I would love to dig into that a little bit. Like you said you that Amazon, you've learned a lot from CloudWatch and building this tool. Everybody looking at kind of, you know, Lambda in the serverless space is like, Okay, how are all these pieces going to come together? Is it all Amazon services all the time? And of course, Amazon has a huge ecosystem, but help us understand or layer down you know how this works? >> Yeah so as you know, AWS services send events to CloudWatch events. They consume events from CloudWatch events. One of the best ways to do it is through Lambda. One of Lambda's biggest strengths is the number of integrations we have with event sources, both taking in events and triggering events. But to your point, there are always events inside database ecosystem. And I think one of the things as a service owner that really excites me about EventBridge is how now customers have access not just to event triggers inside AWS, but also to our partners like Zendesk and the applications you can build will be really exciting. >> Alright, quite a few other announcements, maybe walk us through some of them. >> Yeah, CDK is another announcement where it's an open source software development framework that allows you to model your applications using programming language like TypeScript, Java, Python and .net. You know, the whole thing with building in the cloud, it's slightly different. You used to take your code, put it on a server and run it. Now people are building things a little more distributed, using a lot of different resources for their applications. So it's getting, provisioning your infrastructure is a little bit harder, right? You either have to do a lot of things manually or maybe you're writing a lot of scripts or using a domain specific language. But with CDK, you're now able to use the programming languages that you're programming your applications with, to model and provision your infrastructure. So it's super helpful. Really think it's going to help developers increase their development velocity. They're able to use things like loops, conditions, object oriented programming, they don't have to do context switching and just with a few lines of code, they're able to do a lot more. >> All right. >> I wound up playing with it a little bit when it was in preview and one of the things that I found that it was extremely helpful was, it was a lot easier for me to write something in using CDK, and then see what that rendered down to in terms of cloud formation and then oh, I guess that's how I do it in cloud formation, which was great. The counterpoint though, is it also felt at times like it was super wordy. So if I read that what it generates compared to what I normally write, which is admittedly awful, but I almost start to feel like I'm doing it wrong with that and then with amplify and with Sam and the rest, there's a lot of higher level abstractions that build cloud formation for you. But then it renders down in a few different and key ways. Under the hood, how much are these products that you're coming out with starting to shape the direction of cloud formation itself, or is that mostly baked and done? >> There's a lot of products that we're building that you know, are complementing cloud formation. You know, cloud formation is the templating modeling language to provision AWS resources. But on top of that, we have things like Sam right, that provides a declarative a more high level abstract declarative way to build on top of cloud formation, you know, we have Amplified that also uses cloud formation to help you build mobile applications and front end development. And then finally, you have CDK for just general use. So, these things are all complementing and, you know, things customers are asking for and helping us shape the ecosystem there. >> Yeah, Deepak the container space, of course, has been you know, one of these tidal waves that we've been watching and it's fundamentally changing the way people architect their applications and has huge impact on your product line. Give us the update. If you could just start with some of the high level, I remember first when I talked to you a couple of years ago it was when the whole Kubernetes piece was sorting out. So you know, ECS, EKS, used to have a much longer name that Cory would constantly >> Only for Cory >> Finally you've fixed the compensation problem where someone was getting compensated based upon number of syllables and a service name so good on you on that one. >> Right and you know the acronym A-M-I maybe you can you know settle once and for all you know how how we pronounce that. >> I'm old school it'll always be AMI. (laughs loudly) >> Walk us through kind of, you know your container services. >> I think the great thing about containers is as you said the adoption is everywhere. And what we find is there's a growth of ECS, the growth of EKS whether you're running it on EC2 or Fargate everything is growing like crazy, because people find new interesting ways to run applications based on what they know and what they're comfortable with. We have customers, customers like SNAP that know Kubernetes well and they are building on there're building a big chunk of their new infrastructure on EKS on AWS and it basically helps the developer velocity. On the flip side, you have customers like Turner Broadcasting that run a lot of their web services or the Comedy Central content properties like that on Fargate because they can just stamp them out. They all you know, it's a website, it's a service that they can just keep expanding. So it boils down to what are the key things that you're comfortable with? What are the reasons you've picked something. So if you're running like SNAP across, you know, in many different places, you are likely to choose Kubernetes and standardize on that. So that's the best part for me is, people have choices and then they pick based on what they need at that point in time, which can be two different teams at the same place, picking a different solution. I will add that one of the areas that we are focused on now is observe ability and developer experience. Those are areas that our customers have been asking for. CDK plays into that you saw in the demo this morning and with observe ability with container insights and with the fluid plugins that we announced. I think those are areas that you'll see us do a lot more going forward. >> So right, that was one of news today, CloudWatch container insights just to explain what that one is. >> So historically, when you do CloudWatch look, it's very BM-centric, you're looking at CPU memory, you assuming an application, instances run for a particular period of time. In the container world, you have services where the underlying tasks come and go, all you know, at a very different rate. CloudWatch container insights is meant to be a world that's aware of the fact that your containerized applications are tasks and services and pods, so you're able to get more fine grained metrics on the things that container customers care about and you're not trying to use BM-centric language to look at a containerized infrastructure. So that's the biggest reason for doing that. And then on the Fluent Bit side was, our customers want log routing to whatever they want to do it on. Whether they want it to send to S3 or the Elasticsearch We do that with Kinesis Data Firehose. So we basically wrote a bunch of open source plugins for Fluent Bit that just send your logs where you want them to go. So that's kind of where we are focused. >> Yeah, I view it as more of a log router than I do almost anything else. >> It is that. >> Yeah. A question of: Where does it come from? Where does it go? How do you keep it straight? >> Yeah. >> It's at this point, what does it output to you these days? Are there are various destination options, third party vendors, CloudWatch, history? >> So we wrote two plugins one was for well three, I don't know. One for S3 because so many people don't understand the data to S3. The other one was a Kinesis Data Firehose. So from there, you can send it to Redshift, you can send it to you can send it to Elasticsearch. So based on what you however you want another analyze it, you can send it to a custom resource that's Kinesis. So, you're using some third party provider, you can just send your logs over to those. >> Yeah, Corey, you know, you're dealing with a lot of customers, you know, there's now so many, you know, different instance types and some of the pieces, you know, what's the feedback you're giving to, you know, Amazon these days? >> Entirely depends upon the service teams and it ranges from this is amazing, excellent job to okay, it's a good start. And it's always a question though, it's when you have what 200 service options or darn near it at this point, 170. It's impossible to wind up with something that is evenly consistent and you have services that are sub components of other services and built on top. I mean, I think the, I guess the feedback I've been giving almost universally across the board is, assume that I am about 20% as smart as you right now seem to think I am and then explain it to me and then I'll probably understand it a lot better. It comes down to service to storytelling, more or less of meeting people at various points along their journey and then I was mentioning in our editorial session just before this segment, that that's something that AWS has markedly improved on the last two or three years. Where you have customer stories that are rapidly moving up the stack as far as leverage services. It's not just we took the VMs and now we run them somewhere else. Now it's about building a high, extremely volume intensive applications on top of a whole bunch of managed services and these are serious companies. These are regulators it's not just Twitter for pets anymore. >> Nothing wrong with that. >> No. >> So, you know, we were discussing, like FINRA was a great case study this morning and they talked about in the four years that they've been on, they've re-architected three times. You know, how do you balance all of these new instances coming out with, you know, and how do I make sure that I deploy something today that I've got the flexibility to change, but you know, I want to be able to lock in my pricing and make it easier. >> So actually, we think about that quite a bit. One of the reasons we built app match the way we did, as something that sits outside the container orchestrator, was it doesn't lock you into choosing one or the other or even choosing an architecture. You can start off with a monolith, start putting side cards on it, getting visibility into all your traffic, then portions of your applications you can start breaking out, you can put them on Fargate, you can put them on ECS, you can put them on the EC2. I think that is something we did very consciously because so many of our customers are in that position and I think more and more are going to go higher up the stack using managed databases, using Lambda, but it's not decision they need to make all up front. They can do it piecemeal, and we see our customers find another good example, they've done that. >> One of the philosophies of it, like AWS is giving customers building blocks to build things on. So the whole thing is, here's a new primitive that you can use, then you can take it out, replace something with something else, depending on your needs. So we give customers flexibility and choice. >> And part of the problem is that, that very much becomes a double-edged sword. I mean, most recently, you've had effectively declared war on Alphabet. I don't mean the large cloud provider that turns things off for a living. I'm talking about the English alphabet, where you take a look at all the different EC2 instance types. I think in US East one now there's over what is it 190 different instances you can pick from. It leads to analysis paralysis, which one do I pick? What's the right answer? What am I committing to, what am I not? And you see, that's a microcosm of the larger service problem. I want to build a web app that does a thing, which services do I use, you open up the service listing and you just get this sort of sinking sensation? I get that I can't imagine what someone new to the space is getting to there. >> All right, and this is where things like Amplify, Fargate, AWS Batch where you don't need to select an instance. Where you just tell us what your requirements are and Batch makes that selection for you. The core building blocks are important because you can't really figure out what to do. But then you'll see us do much more about the stack to help people get there. It's an ongoing thing that will keep trying to tackle but you'll see a lot more of that. >> It's controversial. One of my favorite things about Lambda, for example, is there's one knob RAM and as you turn that up, other performance characteristics increase and people complain about it but I love the simplicity, because I don't have to sit and think and make all these different decisions. It's one access. >> Yeah, but if you want more knobs, you can use Fargate. So I think that, that's the beauty of it that you do have that choice. >> Yeah, one of the lines Aaron, I really liked in Werner's keynote is he said, "we've really, you know, my words commoditized IT. "We all have access to all of the tools now." You know, that was, you know what big data originally and cloud also was, you know, you used to have to be a nation state or fortune 100 to be able to do some of these things so, you know, what do you hear from customers? You know, how do they make sure, you know, they're staying competitive and ahead, and therefore, in that relationship between the business and IT, what do you hear from your customers these days? >> In terms of that? Well, I think for, you know, for customers, like I think EventBridge is a, a pretty good example of that, in terms of customers asking us for ability to, you know, integrate their SaaS providers, integrate a lot of different things and not have to, you know, not have to do a lot of undifferentiated heavy lifting and things like that and, you know, customers are increasingly moving towards like event driven architectures and they asked us, hey, we really like CloudWatch events and how you do things with IT automation and then bringing SaaS providers in and, we want to, you know, we don't want to build pulling infrastructure in order to access API's and do all all those heavy liftings. What we did was we built out, we took CloudWatch events and added new features for SaaS applications and built that into a separate service for people to use. So that's like, you know, a lot of the relationships we have with our customers, listening to what they need and giving them what they want. >> And I think that, that's a very valuable thing. You know, we used to say, you know, five years ago, you would talk about, you know, let's get rid of undifferentiated heavy lifting. >> Yeah. >> Well, now it's like, no, no, let's enable, you know, something that you would have thought was heavy lifting and we're daunted to be able to do it but now hopefully, it's easier, because a lot of this stuff, you know, as Corey said, this is still a little bit daunting and you know, well you've got a lot of ecosystem and service providers and services to help us, you know, take care of, you know, because it's the Paradox of Choice with all the options that you have. >> And I think that's the beauty of what, I mean our customers are smart, they manage to find it interesting ways to keep challenging us and they keep us busy. But I also think that really, really many of them, the ones who have been able to be successful, have figured out what it means to take all the tools we give them, which are the ones where they want to completely hand it over to AWS and give us the responsibility and then which ones do they really feel they care about and the ones who can find their balance are the ones that we see moving the fastest. I think that's what we're trying to do. >> All right, now and one thing that does absolutely permeates virtually every service team I've worked with at AWS, I mean, you I've had this experience with you, where I talked about how my use case isn't a terrific fit for your product and your response is always well, what is your use case? It's not, is starting off from the baseline assumption that my use case is ridiculous, which let's face it, it probably is. But being able to address a customer need and understand that even if it doesn't dictate roadmap, is incredibly valuable and I don't find that there are too many players in any space, let alone this one that are willing to have the patience to listen to, frankly, some loud person wearing a suit. >> We try, I mean, I think you heard Andy say there's so much like a big chunk 85, 90% of our roadmap is customer requests, I would say that even the remaining 10% is maybe not things that they've directly asked for but things that we've observed they've run into or that we've run into working with, you know, the one or two customers who are ahead of the pack. And Okay, they have this problem, how do you generalize that? And we try and understand what it means. One of the reasons we made the container roadmap public, was this space is moving so quickly, it's almost impossible for us to talk to enough customers to figure that out. So like, Okay, this gives us an avenue for them to come to us and just tell us, GitHub issues. >> Yeah, so right. Final question I have for both of you. Directionally looking forward, you know, the roadmap, we love when there is publicly facing material not under the NDAs that we normally have to be able to hear. So what are you hearing from your customers? What direction are they pulling you towards and that we should expect to watch AWS kind of further, as we head towards re:Invent later this year. >> I think customers are asking us for different things for developer experience, especially event driven architectures. I think there's going to be a lot of interesting things happening in the Lambda space and that entire space. >> Yeah and to add to that, I think, to your point earlier, helping them simplify choices is going to be a big part of it. Meeting them where they are, in their IDEs with a tooling is a big part of what you'll see us do. So, you know, I think you saw examples today and we'll keep building on top of those. >> All right, well, send our congratulations to the two pizza teams that worked on all of the projects that were announced today. Look forward to seeing you, you know, down the road. Thanks so much and welcome to being Cube alumni. >> Thank you for have us. >> Thank you for having us on. >> Appreciate it. >> Aaron, Deepak you know, from AWS. He's Corey Quinn, I'm Stu Miniman. Back with lots more coverage from AWS summit, here in New York City, thanks for watching the Cube.

>> live from New York. It's the Q covering AWS Global Summit 2019 brought to you by Amazon Web service, is >> Welcome back. Rush hours started a little bit early here in New York City, with over 10,000 people in attendance for any of US Summit in New York City. I'm stupid, and my co host for today is Corey Quinn. Having a welcome to the program to first time guests from our host Amazon Web service is to my right. Here is Deepak Singh, who is the director of Compute Service's. To his right is Aaron Cow, Who's the senior manager product marketing Gentlemen, thanks so much for joining us. Thank >> you for having us >> for having us, all right, so we know that every day we wake up and there's new announcements coming from Amazon, and the only way most of us keep up with it is trying to re Cory's newsletter here. But in your group and computer, we know there's a lot going on and quite a few announcements. So, Aaron, what do you kick us off with? Some of the hard news that went >> through this morning? Yeah, we just launched Amazon event. Bridgette's Ah, serverless event boss that allows youto connect your applications with data from sources like sass applications. A devious resource is in your own applications. >> All right, So Deepak would look to dig into that a little bit. I like you said, you that Amazon. You learned a lot from cloudwatch in building this tool. Everybody looking at kind of lambda and the service faces, Like Okay, how all these pieces together is that all? Amazon service is all the time. And, of course, Amazon has a huge ecosystem. But help help us understand a layer down. You know how this works. >> Yeah. So, you know, a dress service send events watchman consumer event from one of the best ways to do it is through Lando. Lando. One of London's biggest trends is the number off integration we have with events both taking in events and triggering event. But to your point there already events inside database system. I think one of the things as a service owner, that really excites me about event. How now? Customers of access, not just two ventricles inside eight of us were awesome apartments extended so that the application you can build will be really exciting. >> Quite a few other announcements maybe August or someone CK >> is another announcement where it's open. Source. Software development framework allows you to model your applications using programming language like typescript Job a python and got that. You know the whole thing with building in the cloud. It's slightly different. You usedto take your coat. Put it on a servant. Run it. Now people are building things a little more distributed. Using a lot of different resource is for their applications, so it's getting provisioning. Your infrastructure is a little bit harder, right? Either Have to do a lot of things manually. Are maybe you're writing. A lot of scripts are using a domain specific language, But with CD Kay, you're now able to use the programming languages that you're hurting your applications with two model and provisions your infrastructure. So it's super helpful. Really think it's gonna help developers increase their development velocity? They're able to use things like loops, conditions, object oriented programming. They don't have to do context switching and just a few lines of code. They're able to do a lot more. All right, >> I want I want a playing with it a little bit when it was in review, and one of things that I found that it was extremely helpful was it was a lot easier for me to write something in using CD kay and then see what that rendered down to in terms of cloud formation. And then, oh, I guess that's how I do it in cloud formation, which was great. The counterpoint, though, is it also felt, at times like it was super wordy. So if I read that what it generates compared to what I normally right, which is admittedly awful. But it's all right, we'll start to feel like I'm doing it wrong with that. And then with amplify and with Sam and the rest. There's a lot of higher level abstractions that build cloud formation for you. But then it renders down in a few different key ways under the hood. How much are these products that you're coming out with starting to shape the direction of confirmation itself? Or is that mostly baked and done? >> There's a lot of products that we're building that you know are complimenting information. Information is the template ing modeling language to provisional abusive resource is put on top of that. We have things like Sam, right? That provides a declared of ATM or high level abstracted declared way to build on topical information. You know, we have amplified also use this information to help you build mobile applications in front development and then finally have see decay for general use other things. They're all complimenting and you know are things customers are asking for helping us >> get the ecosystem. Deepak. The container space, of course, has been You know what one of these tidal waves that we've been watching on It's fundamentally changing the way people architect their applications. That huge impact on your product line Give us the update. If you could just start with some of the high level. Remember first when I talk to you. A couple of years ago, the whole kubernetes piece was sorting out. So you know, e c s E. K s usedto have a much longer name that Cory >> Cory. Finally, you fix the compensation problem where someone was getting compensated based upon number of syllables in a service name. So good on you on that one. >> Right on. Uh, you know, acronym, am I? Maybe you can you know, settle once and for all. You know how how we pronounce that >> I'm old school in love with the Army. >> But what what walk us through? Kind of. You know, your container service is, >> I think, the great thing about container, I said, adoption is everywhere on what we find. It brought a VCs the growth of cares where they're running it on to our fargate. Everything is growing like crazy because people find new interesting ways to run applications based on what they know. One what they're comfortable with their customers. Customers like Snap. There's no community well, and they're building on their building a big chunk of their new infrastructure on kneecaps or need to be with, and it basically helped develop a velocity. On the flip side, your customers like Turner Broadcasting that run a lot of their Web service is the comedy central content properties like that on Fargate because they can just stamp them out. They all you know, it's about time. It's a service that you can just keep expanding. So it boils down to one of the key things that you're comfortable with. One of the reasons you fix something if you are running like snap across. You know, in many different looks places you are likely to choose community and standardize on that. So that's the best part for me is people have choices and then the pic based on what they need. At that point in time, it can be two different teams at the same place. Picking a different solution. I will add that one of the areas that we are focused on now is a dub ability and develop experience, though the areas that our customers have been asking for CD Kay played into that record in the demo this morning. And with the probability with container inside on with the fluid that be announced, I think though that area, they do a lot more >> going forward, right? That was one of those cloudwatch container insights. Just explain what that one is >> so historically, when you do cloudwatch look very bm centric, you're looking at CPU memory. You're zooming application. We are instances run for a particular period of time. At the container world you have service is with the underlying tasks. Come and go all you know, a very different rate container inside. It's meant to be a world aware of the fact that you're containerized application that fast service is and part, they're able to get more fine grained metrics on the things that container customers care about. And you're not trying to use the BM centric language to look at the content. That's the biggest reason for doing that. And then on the floor in bedside Boy, our customers want loud rounding to whatever they want to do it on where they understand three or elasticsearch. We do that with data borrows. So we basically wrote a bunch of open source plug in for fluent, but they just end your log where you want them to go. That's kind of maybe a >> Yeah, I view it as more of a log router than I do. Almost anything else? Yeah, a question of where did it come from? Where does it go? How do you do? Keep straight. It's at this point. What is it out? What is it output to these days of their various destination options? Third party vendors cloudwatch history >> to plug in 14315413 because so many people in the center there with three the other one was like Anita. There. Apart from there, you can send it to read, Chef, you can send it todo you can send it to elasticsearch. So based on what however you want and I'll analyze it, you can send it to a custom resource. So you want you're using some third party provider. You can just send your logs over to those. >> Corey, you know, you're dealing with a lot of customers. You know, there's so many, you know, different instance types and some of some of the pieces. You know, what's the feedback you're giving? You know, Amazon these days >> entire depends upon the service teams, and it ranges from This is amazing. Excellent job, too. Okay, it's a good start, and it's always a question, though. It's when you have what 200 service options are darn near. It at this point aren't 70. It's impossible to wind up with something that is evenly consistent, and you have service is that air sub components of other service is built on top. I mean, I think the uh, I guess the feedback I've been giving almost universally across the board is assume that I am about 20% as smart as you right now seem to think I am and then explain it to me, and then I'll probably understand it a lot better. It comes down to service the storytelling more or less of meeting people of various points along their journey, and that I was mentioning in our editorial session just before this segment that that's something that AWS has markedly improved on the last two or three years, where you have customer stories that are rapidly moving up the up the stack as Faras Leverage Service's It's not just we took the EMS, and now we run them somewhere else. Now it's about building of extremely volume intensive applications on top of a whole bunch of managed service is and these air serious cos these air regulators. It's not just Twitter for pets anymore. >> Nothing wrong with that. No, >> So way were discussing like Enron was a great case this morning, and they talked about in the four years that they've been on, they re architected three times, you know, how do you balance all of these new wins is coming out with, you know, how do we make sure that I deploy something today that I've got the flexibility to change. But, you know, I want to be able to lock in my pricing and make it easier. >> Actually, we think about that quite a bit. One of the reasons we met, the way we did something that sits outside a container orchestrator. What? It doesn't lock you into choosing one or the other or even using an architecture. You can start over the monolith, start putting sidecars on it. It's getting with the ability to all your traffic portions of applications. You can start breaking out. You can put them on target. You can put them on PCs. You can put them on it, too. I think that is something we did very consciously because so many of our customers are in that position. And I think more and more are going to go higher up the stock using managed databases. You think lambda. But it's not decision they need to make all up front. They can do it piecemeal, and we see a custom fender. The good example there done that. >> I think one of the >> philosophies of like eight of us is giving customers building blocks the buildings on, so the whole thing is here's a new primitive that you can use. Then you can take it out, replace something with something else, depending on your needs. So we give customers flexibility and choice. >> And part of the problem is that that very much becomes a double edged sword. I mean, most recently you've had effectively declared war on alphabet. I don't mean the large cloud provider that turns things off for a living. I'm talking about the English alphabet where you take a look at all the different ec2 instance types. I think in US East one. Now there's over. What is it? 100 90 different instances you can pick from. It leads to analysis paralysis. Which one do I pick? What's the right answer? What am I committing to? What am I not? And you see that? That's a microcosm. The larger service problem. I want to build a Web app that does a thing. Which service is do I use? You open up the service listing and you just get this sort of sinking sensation. I get that. I can't imagine what someone new to the space is getting to >> you, and this is where things like amplify fargate aws patch. You don't need to select an instance where you just tell us for your requirements are on Batch makes that collection for you the core building. What's important because you can't really figure out what to do. But then you see us too much more about the attack to help people get there. It's an ongoing thing that will keep trying to tackle, but you see a lot more of that. >> It's controversial. One of my favorite things about Lambda, for example, is there's one knob ram, and as you turn that up, other performance characteristics increase and people complain about it. But I love the simplicity because I don't have to sit and think and make all these different decisions. It's one access, >> but if you want more knob, you can you fuck it. So I think that that's the beauty ofit that you do have that choice. >> Yeah, one lines there, and I really liked it. Borders keynote. Is he said way? Really? You know my words, commoditized. I t We all have access to all of the tools now, you know that was you know what big date originally file. It also was used to have to be a nation state 4100 to be able to do some of these things. So, you know, what do you hear from customers? How do they make sure you know, they're staying competitive and ahead on their four in that relationship between the business and I T. What do you hear from your customers these days? >> In terms of that? Well, I think, um, for you know, for customers like I think of Emperor age is a, uh, a pretty good example off that in terms of customers asking us for ability to, you know, integrate their SAS providers and a great a lot of different things and not have thio you No, no, no. >> I have >> to do a lot of undifferentiated heavy lifting and things like that. And customers are increasingly moving towards, like avenger oven architectures. And they asked us, Hey, we really like cloudwatch events and how you do things with a iittie automation and then bringing SAS providers and on way wantto you know, we don't want to build a polling infrastructure and orderto access athe eyes and do all all the heavy lifting. What we did was we built out way took cloudwatch events and added new features for SAS applications and build that into a separate service for people to use. That's like, you know, a lot of the relationships we have our customers listening to what they need and giving them what they want. >> I think that that's a very valuable thing. We used to say, You know, five years ago you would talk about, you know, let's get rid of indifferent, heavy lifting Well, now it's like, No, no, let's enable you know some thing that you would have thought was heavy lifting and we're daunted to be able to do it. But now hopefully it's easier because a lot of this stuff, you know, he said, This is still a little bit daunting, and you know, you've got a lot of ecosystem and service providers, and service is help us. You take care of, you know, because it's the paradox of choice. With all the options that you >> have on. I think that's the beauty of what I'm in a customer that smart. They managed to find interesting ways to keep challenging us and keep us busy. But I also think that really, really many of them the ones who've been able to be successful. I figured out what it needs to be. Take all the tools to give them which other ones where they want to completely hand it over to AWS and give us the responsibility. And then which ones today really feeling, get they care about and the ones who can find their balance of the ones that we see moving faster. I think that's what we're trying to >> write that one thing that does absolutely permeates virtually every service team I've worked with that AWS. I mean, I've had this experience with you where I talk about how my use case isn't a terrific fit for your product, and your response is always well, what is your use case? It's not. Is starting off on the baseline assumption that my use cases ridiculous, which, let's face it, it probably is. But being able to address a customer need to understand that even if it doesn't dictate, road map is incredibly valuable, and I don't find there are too many players in any space, let alone this one that are willing to have the patience to listen to. Frankly, some loud person wearing a suit. >> Way try. I mean, I think you heard me say this so much like a big junk. 85 90% of a road map. Customer request. I would say that even though remember remaining 10% maybe not think that they're directly asked for but think that you observed their running to or that we run into working with, you know, the one of the customers go ahead of the pack. Okay. They have this problem, Baker. How do you generalize that? And we try and understand what it means. One of the reasons to be made the container road map public was This space is moving so quickly. It's almost impossible for us to talk to enough customers to figure that out. So, like, okay, that gives us an avenue for them to come to us and just tell us and get have >> issues. Yeah, s o right. Final question for both of you directions. Looking forward, you know, the road map we love when there is publicly facing material, not under the NBA's that we normally have to be able to hear. So what are you hearing from your customers? What direction are they pulling you towards and that we should expect tow watch aws kind of a cz we head towards reinvent later this year. Yeah, >> like customers are asking us for different things for developer experience, especially event driven architectures. I think there's gonna be a lot of interesting things happening in the land of space and that entire space >> on to add to that. I think your point earlier helping the simplified choices is going to be a big part of it. Meeting them where they are in their ideas with the cooling is a big part of what you'll see us do. So you know, I think you saw examples today. We'll keep building on top of >> All right. Well, send our congratulations to the two pizza teams that worked on all of the projects that were announced today. Look forward to seeing you. You know, down the road in tracking down. Thanks so much. And welcome to be in Cuba one night having us Deepak, you know, from AWS. He's Cory Quinn on student back with lots more coverage from 80 West Summit here in New York City. Thanks for watching