>> Announcer: From theCUBE Studios in Palo Alto and Boston, connecting with thought leaders all around the world, this is a CUBE conversation. >> Hello, welcome back to theCUBE's coverage, CUBE Virtual's coverage, CUBE digital coverage, of AWS Summit, virtual online, Amazon Summit's normally in face-to-face all around the world, it's happening now online, follow the sun. Of course, we want to bring theCUBE coverage like we do at the events digitally, and we've got a great guest that usually comes on face-to-face, he's coming on virtual, Sanjay Poonen, the chief operating officer of VMware. Sanjay great to see you, thanks for coming in virtually, you look great. >> Hey, John thank you very much. Always a pleasure to talk to you. This is the new reality. We both happen to live very close to each other, me in Los Altos, you in Palo Alto, but here we are in this new mode of communication. But the good news is I think you guys at theCUBE were pioneering a lot of digital innovation, the AI platform, so hopefully it's not much of an adjustment for you guys to move digital. >> It's not really a pivot, just move the boat, put the sails up and sail into the next generation, which brings up really the conversation that we're seeing, which is this digital challenge, the virtual world, it's virtualization, Sanjay, it sounds like VMware. Virtualization spawned so much opportunity, it created Amazon, some say, I'd say. Virtualizing our world, life is now integrated, we're immersed into each other, physical and digital, you got edge computing, you got cloud native, this is now a clear path to customers that recognize with the pandemic challenges of at-scale, that they have to operate their business, reset, reinvent, and grow coming out of this pandemic. This has been a big story that we've been talking about and a lot of smart managers looking at projects saying, I'm doubling down on that, and I'm going to move the resources from this, the people and budget, to this new reality. This is a tailwind for the folks who were prepared, the ones that have the experience, the ones that did the work. theCUBE, thanks for the props, but VMware as well. Your thoughts and reaction to this new reality, because it has to be cloud native, otherwise it doesn't work, your thoughts. >> Yeah, I think, John, you're right on. We were very fortunate as a company to invent the term virtualization for an x86 architecture and the category 20 years ago when Diane founded this great company. And I would say you're right, the public cloud is the instantiation of virtualization at its sort of scale format and we're excited about this Amazon partnership, we'll talk more about that. This new world of doing everything virtual has taken the same concepts to whole new levels. We are partnering very closely with companies like Zoom, because a good part of this is being able to deliver video experiences in there, we'll talk about that if needed. Cloud native security, we announced an acquisition today in container security that's very important because we're making big moves in security, security's become very important. I would just say, John, the first thing that was very important to us as we began to shelter in place was the health of our employees. Ironically, if I go back to, in January I was in Davos, in fact some of your other folks who were on the show earlier, Matt Garman, Andy, we were all there in January. The crisis already started in China, but it wasn't on the world scene as much of a topic of discussion. Little did we know, three, four weeks later, fast forward to February things were moving so quickly. I remember a Friday late in February where we were just about to go the next week to Las Vegas for our in-person sales kickoffs. Thousands of people, we were going to do, I think, five or 6,000 people in Las Vegas and then another 3,000 in Barcelona, and then finally in Singapore. And it had not yet been categorized a pandemic. It was still under this early form of some worriable virus. We decided for the health and safety of our employees to turn the entire event that was going to happen on Monday to something virtual, and I was so proud of the VMware team to just basically pivot just over the weekend. To change our entire event, we'd been thinking about video snippets. We have to become in this sort of virtual, digital age a little bit like TV producers like yourself, turn something that's going to be one day sitting in front of an audience to something that's a lot shorter, quicker snippets, so we began that, and the next thing we began doing over the next several weeks while the shelter in place order started, was systematically, first off, tell our employees, listen, focus on your health, but if you're healthy, turn your attention to serving your customers. And we began to see, which we'll talk about hopefully in the context of the discussion, parts of our portfolio experience a tremendous amount of interest for a COVID-centered world. Our digital workplace solutions, endpoint security, SD-WAN, and that trifecta began to be something that we began to see story after story of customers, hospitals, schools, governments, retailers, pharmacies telling us, thank you, VMware, for helping us when we needed those solutions to better enable our people on the front lines. And all VMware's role, John, was to be a digital first responder to the first responder, and that gave tremendous amount of motivation to all of our employees into it. >> Yeah, and I think that's a great point. One of the things we've been talking about, and you guys have been aligned with this, you mentioned some of those points, is that as we work at home, it points out that digital and technology is now part of lifestyle. So we used to talk about consumerization of IT, or immersion with augmented reality and virtual reality, and then talk about the edge of the network as an endpoint, we are at the edge of the network, we're at home, so this highlights some of the things that are in demand, workspaces, VPN provisioning, these new tools, that some cases we've been hearing people that no one ever thought of having a forecast of 100% VPN penetration. Okay, you did the AirWatch deal way back when you first started, these are now fruits of those labors. So I got to ask you, as managers of your customer base are out there thinking, okay, I got to double down on the right growth strategy for this post-pandemic world, the smart managers are going to look at the technologies enabled for business outcome, so I have to ask you, innovation strategies are one thing, saying it, putting it place, but now more than ever, putting them in action is the mandate that we're hearing from customers. Okay I need an innovation strategy, and I got to put it into action fast. What do you say to those customers? What is VMware doing with AWS, with cloud, to make those innovation strategies not only plausible but actionable? >> That's a great question, John. We focused our energy, before even COVID started, as we prepared for this year, going into sales kickoffs and our fiscal year, around five priorities. Number one was enabling the world to be multicloud, private cloud and public cloud, and clearly our partnership here with Amazon is the best example of that and they are our preferred cloud partner. Secondly, building modern apps with microservices and cloud native, what we call app modernization. Thirdly, which is a key part to the multicloud, is building out the entire network stack, data center networking, the firewalls, the load bouncing in SD-WAN, so I'd call that cloud network. Number four, the modernization of workplace with an additional workspace solution, Workspace ONE. And five, intrinsic security from all aspects of security, network, endpoint, and cloud. So those five priorities were what we began to think through, organize our portfolio, we call them solution pillars, and for any of your viewers who're interested, there's a five-minute version of the VMware story around those five pillars that you can watch on YouTube that I did, you just search for Sanjay Poonen and five-minute story. But then COVID hit us, and we said, okay we got to take these strategies now and make them more actionable. Exactly your question, right? So a subset of that portfolio of five began to become more actionable, because it's pointless going and talking about stuff and it's like, hey, listen, guys, I'm a house on fire, I don't care about the curtains and all the wonderful art. You got to help me through this crisis. So a subset of that portfolio became kind of what was those, think about now your laptop at home, or your endpoint at home. People wanted, on top of their Zoom call, or surrounding their Zoom call, a virtual desktop managed easily, so we began to see Workspace ONE getting a lot of interest from our customers, especially the VDI part of that portfolio. Secondly, that laptop at home needed to be secured. Traditional, old, legacy AV solutions that've worked, enter Carbon Black, so Workspace ONE plus Carbon Black, one and two. Third, that laptop at home needs network acceleration, because we're dialoguing and, John, we don't want any latency. Enter SD-WAN. So the trifecta of Workspace ONE, Carbon Black and VeloCloud, that began to see even more interest and we began to hone in our portfolio around those three. So that's an example of where you have a general strategy, but then you apply it to take action in the midst of a crisis, and then I say, listen, that trifecta, let's just go and present what we can do, we call that the business continuity or business resilience part of our portfolio. We began to start talking to customers, and saying, here's our business continuity solution, here's what we could do to help you, and we targeted hospitals, schools, governments, pharmacies, retailers, the ones who're on the front line of this and said again, that line I said earlier, we want to be a digital first responder to you, you are the real first responder. Right before this call I got off a CIO call with the CIO of a major hospital in the northeast area. What gives me great joy, John, is the fact that we are serving them. Their beds are busting at the seam, in serving patients-- >> And ransomware's a huge problem you guys-- >> We're serving them. >> And great stuff there, Sanjay, I was just on a call this morning with a bunch of folks in the security industry, thought leaders, was in DC, some generals were there, some real thought leaders, trying to figure out security policy around biosecurity, COVID-19, and this invisible disruption, and they were equating it to like the World Wars. Big inflection point, and one of the generals said, in those times of crisis you need alliances. So I got to ask you, COVID-19 is impactful, it's going to have serious impact on the critical nature of it, like you said, the house is on fire, don't worry about the curtains. Alliances matter more than ever when you need to come together. You guys have an ecosystem, Amazon's got an ecosystem, this is going to be a really important test to the alliances out there. How do you view that as you look forward? You need the alliances to be successful, to compete and win in the new world as this invisible enemy, if you will, or disruptor happens, what's your thoughts? >> Yeah, I'll answer in a second, just for your viewers, I sneezed, okay? I've been on your show dozens of time, John, but in your live show, if I sneezed, you'd hear the loud noise. The good news in digital is I can mute myself when a sneeze is about to happen, and we're able to continue the conversation, so these are some side benefits of the digital part of it. But coming to your question on alliance, super important. Ecosystems are how the world run around, united we stand, divided we fall. We have made ecosystems, I've always used this phrase internally at VMware, sort of like Isaac Newton, we see clearly because we stand on the shoulders of giants. So VMware is always able to be bigger of a company if we stand on the shoulders of bigger giants. Who were those companies 20 years ago when Diane started the company? It was the hardware economy of Intel and then HP and Dell, at the time IBM, now Lenovo, Cisco, NetApp, DMC. Today, the new hardware companies Amazon, Azure, Google, whoever have you, we were very, I think, prescient, if you would, to think about that and build a strategic partnership with Amazon three or four years ago. I've mentioned on your show before, Andy's a close friend, he was a classmate over at Harvard Business School, Pat, myself, Ragoo, really got close to Andy and Matt Garman and Mike Clayville and several members of their teams, Teresa Carlson, and began to build a partnership that I think is one of the most incredible success stories of a partnership. And Dell's kind of been a really strong partner with us on private cloud, having now Amazon with public cloud has been seminal, we do regular meetings and build deep integration of, VMware Cloud and AWS is not some announcement two or three years ago. It's deep engineering between, Bask's now in a different role, but in his previous role, that and people like Mark Lohmeyer in our team. And that deep engineering allows us to know and tell customers this simple statement, which both VMware and Amazon reps tell their customers today, if you have a workload running on vSphere, and you want to move that to Amazon, the best place, the preferred place for that is VMware Cloud and Amazon. If you try to refactor that onto a native VC 2, it's a waste of time and money. So to have the entire army of VMware and Amazon telling customers that statement is a huge step, because it tells customers, we have 70 million virtual machines running on-prem. If customers are looking to move those workloads to Amazon, the best place for that VMware Cloud and AWS, and we have some credible customer case studies. Freddie Mac was at VMworld last year. IHS Markit was at VMworld last year talking about it. Those are two examples and many more started it, so we would like to have every VMware and Amazon customer that's thinking about VMware to look at this partnership as one of the best in the industry and say very similar to what Andy I think said on stage at the time of this announcement, it doesn't have to be now a trade-off between public and private cloud, you can get the best of both worlds. That's what we're trying to do here-- >> That's a great point, I want to get your thoughts on leadership, as you look at COVID-19, one of our tracks we're going to be promoting heavily on theCUBE.net and our sites, around how to manage through this crisis. Andy Jassy was quoted on the fireside chat, which is coming up here in North America, but I saw it yesterday in New Zealand time as I time shifted over there, it's a two-sided door versus a one-sided door. That was kind of his theme is you got to be able to go both ways. And I want to get your thoughts, because you might know what you're doing in certain contexts, but if you don't know where you're going, you got to adjust your tactics and strategies to match that, and there's and old expression, if you don't know where you're going, every road will take you there, okay? And so a lot of enterprise CXOs or CEOs have to start thinking about where they want to go with their business, this is the growth strategy. Then you got to understand which roads to take. Your thoughts on this? Obviously we've been thinking it's cloud native, but if I'm a decision maker, I want to make sure I have an architecture that's going to carry me forward to the future. I need to make sure that I know where I'm going, so I know what road I'm on. Versus not knowing where I'm going, and every road looks good. So your thoughts on leadership and what people should be thinking around knowing what their destination is, and then the roads to take? >> John, I think it's the most important question in this time. Great leaders are born through crisis, whether it's Winston Churchill, Charles de Gaulle, Roosevelt, any of the leaders since then, in any country, Mahatma Gandhi in India, the country I grew up, Nelson Mandela, MLK, all of these folks were born through crisis, sometimes severe crisis, they had to go to jail, they were born through wars. I would say, listen, similar to the people you talked about, yeah, there's elements of this crisis that similar to a World War, I was talking to my 80 year old father, he's doing well. I asked him, "When was the world like this?" He said, "Second World War." I don't think this crisis is going to last six years. It might be six or 12 months, but I really don't think it'll be six years. Even the health care professionals aren't. So what do we learn through this crisis? It's a test of our leadership, and leaders are made or broken during this time. I would just give a few guides to leaders, this is something tha, Andy's a great leader, Pat, myself, we all are thinking through ways by which we can exercise this. Think of Sully Sullenberger who landed that plane on the Hudson. Did he know when he flew that airbus, US Airways airbus, that few flock of birds were going to get in his engine, and that he was going to have to land this plane in the Hudson? No, but he was making decisions quickly, and what did he exude to his co-pilot and to the rest of staff, calmness and confidence and appropriate communication. And I think it's really important as leaders, first off, that we communicate, communicate, communicate, communicate to our employees. First, our obligation is first to our employees, our family first, and then of course to our company employees, all 30,000 at VMware, and I'm sure similarly Andy does it to his, whatever, 60, 70,000 at AWS. And then you want to be able to communicate to them authentically and with clarity. People are going to be reading between the lines of everything you say, so one of the things I've sought to do with my team, all the front office functions report to me, is do half an hour Zoom video conferences, in the time zone that's convenient to them, so Japan, China, India, Europe, in their time zone, so it's 10 o'clock my time because it's convenient to Japan, and it's just 10 minutes of me speaking of what I'm seeing in the world, empathizing with them but listening to them for 20 minutes. That is communication. Authentically and with clarity, and then turn your attention to your employees, because we're going stir crazy sitting at home, I get it. And we've got to abide by the ordinances with whatever country we're in, turn your attention to your customers. I've gotten to be actually more productive during this time in having more customer conference calls, video conference calls on Zoom or whatever platform with them, and I'm looking at this now as an opportunity to engage in a new way. I have to be better prepared, like I said, these are shorter conversations, they're not as long. Good news I don't have to all over the place, that's better for my family, better for the carbon emission of the world, and also probably for my life long term. And then the third thing I would say is pick one area that you can learn and improve. For me, the last few years, two, three years, it's been security. I wanted to get the company into security, as you saw today we've announced mobile, so I helped architect the acquisition of Carbon Black, very similar to kind of the moves I've made six years ago around AirWatch, very key part to all of our focus to getting more into security, and I made it a personal goal that this year, at the start of the year, before COVID, I was going to meet 1,000 CISOs, in the Fortune 1000 Global 2000. Okay, guess what, COVID happens, and quite frankly that goal's gotten a little easier, because it's much easier for me to meet a lot more people on Zoom video conferences. I could probably do five, 10 per day, and if there's 200 working days in a day, I can easily get there, if I average about five per day, and sometimes I'm meeting them in groups of 10, 20. >> So maybe we can get you on theCUBE more often too, 'cause you have access to a video camera. >> That is my growth mindset for this year. So pick a growth mindset area. Satya Nadella puts this pretty well, "Move from being a know-it-all to a learn-it-all." And that's the mindset, great company. Andy has that same philosophy for Amazon, I think the great leaders right now who are running these cloud companies have that growth mindset. Pick an area that you can grow in this time, and you will find ways to do it. You'll be able to learn online and then be able to teach in some fashion. So I think communicate effectively, authentically, turn your attention to serving your customers, and then pick some growth area that you can learn yourself, and then we will come out of this crisis collectively, individuals and as partners, like VMware and Amazon, and then collectively as a society, I believe we'll come out stronger. >> Awesome great stuff, great insight there, Sanjay. Really appreciate you sharing that leadership. Back to the more of technical questions around leadership is cloud native. It's clear that there's going to be a line in the sand, if you will, there's going to be a right side of history, people are going to have to be on the right side of history, and I believe it's cloud native. You're starting to see this emersion. You guys have some news, you just announced today, you acquired a Kubernetes security startup, around Kubernetes, obviously Kubernetes needs security, it's one of those key new enablers, disruptive enablers out there. Cloud native is a path that is a destination opportunity for people to think about, why that acquisition? Why that company? Why is VMware making this move? >> Yeah, we felt as we talked about our plans in security, backing up to things I talked about in my last few appearances on your show at VMworld, when we announced Carbon Black, was we felt the security industry was broken because there was too many point benders, and we figured there'd be three to five control points, network, endpoint, cloud, where we could play a much more pronounced role at moving a lot of these point benders, I describe this as not having to force our customers to go to a doctor and say I've got to eat 5,000 tablets to get healthy, you make it part of your diet, you make it part of the infrastructure. So how do we do that? With network security, we're off to the races, we're doing a lot more data center networking, firewall, load bouncing, SD-WAN. Really, reality is we can eat into a lot of the point benders there that I've just been, and quite frankly what's happened to us very gratifying in the network security area, you've seen the last few months, some firewall vendors are buying SD-WAN players, kind of following our strategy. That's a tremendous validation of the fact that the network security space is being disrupted. Okay, move to endpoint security, part of the reason we acquired Carbon Black was to unify the client side, Workspace ONE and Carbon Black should come together, and we're well under way in doing that, make Carbon Black agentless on the server side with vSphere, we're well on the way to that, you'll see that very soon. By the way both those things are something that the traditional endpoint players can't do. And then bring out new forms of workload. Servers that are virtualized by VMware is just one form of work. What are other workloads? AWS, the public clouds, and containers. Container's just another workload. And we've been looking at container security for a long time. What we didn't want to do was buy another static analysis player, another platform and replatform it. We felt that we could get great technology, we have incredible grandeur on container cell. It's sort of Red Hat and us, they're the only two companies who are doing Kubernetes scales. It's not any of these endpoint players who understand containers. So Kubernetes, VMware's got an incredible brand and relevance and knowledge there. The networking part of it, service mesh, which is kind of a key component also to this. We've been working with Google and others like Istio in service mesh, we got a lot of IP there that the traditional endpoint players, Symantec, McAfee, Trend, CrowdStrike, don't know either Kubernetes or service mesh well. We add now container security into this, we really distinguish ourselves further from the traditional endpoint players with bringing together, not just the endpoint platform that can do containers, but also Kubernetes service mesh. So why is that important? As people think about their future in containers, they'll want to do this at the runtime level, not at the static level. They'll want to do it at build time And they'll want to have it integrated with some of their networking capabilities like service mesh. Who better to think about that IP and that evolution than VMware, and now we bring, I think it's 12 to 14 people we're bringing in from this acquisition. Several of them in Israel, some of them here in Palo Alto, and they will build that platform into the tech that VMware has onto the Carbon Black cloud and we will deliver that this year. It's not going to be years from now. >> Did you guys talk about the-- >> Our capability, and then we can bring the best of Carbon Black, with Tanzu, service mesh, and even future innovation, like, for example, there's a big movement going around, this thing call open policy agent OPA, which is an open source effort around policy management. You should expect us to embrace that, there could be aspects of OPA that also play into the future of this container security movement, so I think this is a really great move for Patrick and his team, I'm very excited. Patrick is the CEO of Carbon Black and the leader of that security business unit, and he came to me and said, "Listen, one of the areas "we need to move in is container security "because it's the number one request I'm hearing "from our CESOs and customers." I said, "Go ahead Patrick. "Find out who are the best player you could acquire, "but you have to triangulate that strategy "with the Tanzu team and the NSX team, "and when you have a unified strategy what we should go, "we'll go an make the right acquisition." And I'm proud of what he was able to announce today. >> And I noticed you guys on the release didn't talk about the acquisition amount. Was it not material, was it a small amount? >> No, we don't disclose small, it's a tuck-in acquisition. You should think of this as really bringing us some tech and some talent, and being able to build that into the core of the platform of Carbon Black. Carbon Black was the real big move we made. Usually what we do, you saw this with AirWatch, right, anchor on a fairly big move. We paid I think 2.1 billion for Carbon Black, and then build and build and build on top of that, partner very heavily, we didn't talk about that. If there's time we could talk about it. We announced today a security alliance with top SIEM players, in what's called a sock alliance. Who's announced in there? Splunk, IBM QRadar, Google Chronicle, Sumo Logic, and Exabeam, five of the biggest SIEM players are embracing VMware in endpoint security, saying, Carbon Black is who we want to work with. Nobody else has that type of partnership, so build, partner, and then buy. But buy is always very carefully thought through, we're not one of these companies like CA of the past that just bought every company and then it becomes a graveyard of dead acquisition. Our view is we're very disciplined about how we think about acquisition. Acquisitions for us are often the last resort, because we'd prefer to build and partner. But sometimes for time-to-market reasons, we acquire, and when we acquire, it's thoughtful, it's well-organized within VMware, and we take care of our people, 'cause we want, I mean listen, why do acquisitions fail? Because the good people leave. So we're excited about this team, the team in Israel, and the team in Palo Alto, they come from Octarine. We're going to integrate them rapidly into the platform, and this is a good evidence of VMware investing more in security, and our Q3 earnings pulled, John, I said, sorry, we said that the security business was a billion dollar business at VMware already, primarily from network, but some from endpoint. This is evidence of us putting more fuel behind that fire. It's only been six, seven months and Patrick's made his first acquisition inside Carbon Black, so you're going to see us investing more in security, it's an important priority for the company, and I expect us to be a very prominent player in these three pillars, network security, endpoint security, endpoint is both client and the workload, and cloud. Network, endpoint, cloud, they are the three areas where we think there's lots of room for innovation in security. >> Well, we'll be watching, we'll be reporting and analyzing the moves. Great playbook, by the way. Love that organic partnering and then key acquisitions which you build around, it's a great playbook, I think it's very relevant for this time. The most important question I have to ask you, Sanjay, and this is a personal question, because you're the leader of VMware, I noticed that, we all know you're into music, you've been putting music online, kind of a virtual band. You've also hired a CUBE alumni, Victoria Verango from McAfee who also puts up music, you've got some musicians, but you kind of know how to do the digital moves there, so the question is, will the music at VMworld this year be virtual? >> Oh, man. Victoria is actually an even better musician than me. I'm excited about his marketing gifts, but I'm also excited to watch him. But yeah, you've heard him sing, he's got a voice that's somewhat similar to Sting, so we, just for fun, in our Diwali, which is an Indian celebration last year, Tom Corn, myself, and a wonderful lady named Divya, who's got a beautiful voice, had sung a song, which was off the soundtrack of the Bollywood movie, "Secret Superstar," and we just for fun decided to record that in our three separate homes, and put that out on YouTube. You can listen, it's just a two or three-minute run, and it kind of went a little bit viral. And I was thinking to myself, hey, if this is one way by which we can let the VMware community know that, hey, you know what, art conquers COVID-19, you can do music even socially distant, and bring out the spirit of VMware, which is community. So we might build on that idea, Victoria and I were talking about that last night and saying, hey, maybe we do a virtual music kind of concert of maybe 10 or 15 or 20 voices in the various different countries. Record piece of a song and music and put it out there. I think these are just ways by which we're having fun in a virtual setting where people get to see a different side of VMware where, and the intent here, we're all amateurs, John, we're not like great. There are going to be mistakes in this music. If you listen to that audio, it sounds a little tinny, 'cause we're recording it off our iPhone and our iPad microphone. But we'll do the best we can, the point is just to show the human spirit and to show that we care, and at the end of the day, see, the COVID-19 virus has no prejudice on color of skin, or nationality, or ethnicity. It's affecting the whole world. We all went into the tunnel at different times, we will come out of this tunnel together and we will be a stronger human fabric when we're done with this, We shall absolutely overcome. >> Sanjay, give us a quick update to end the segment on your thoughts around VMworld. It's one of the biggest events, we look forward to it. It's the only even left standing that theCUBE's been to every year of theCUBE's existence, we're looking forward to being part of theCUBE virtual. It's been announced it's virtual. What are some of the thinking going on at the highest levels within the VMware community around how you're going to handle VMworld this year? >> Listen, when we began to think about it, we had to obviously give our customers and folks enough notice, so we didn't want to just spring that sometime this summer. So we decided to think through it carefully. I asked Robin, our CMO, to talk to many of the other CMOs in the industry. Good news is all of these are friends of ours, Amazon, Microsoft, Google, Salesforce, Adobe, and even some smaller companies, IBM did theirs. And if they were in the first half of the year, they had to go virtual 'cause we're sheltered in place, and IBM did theirs, Okta did theirs, and we began to watch how they were doing this. We're kind of in the second half, because we were August, September, and we just sensed a lot of hesitancy from our customers that wanted to get on a plane to come here, and even if we got just 500, 1,000, a few thousand, it wasn't going to be the same and there would always be that sort of, even if we were getting back to that, some worry, so we figured we'd do something that might be semi-digital, and we may have some people that roam, but the bulk of it is going to be digital, and we changed the dates to be a little later. I think it's September 20th to 29th. Right now it's all public now, we announced that, and we're going to make it a great program. In some senses like we're becoming TV producer. I told our team we got to be like Disney or ESPN or whoever your favorite show is, YouTube, and produce a really good several-hour program that has got a different way in which digital content is provided, smaller snippets, very interesting speakers, great brand names, make the content clear, crisp and compelling. And if we do that, this will be, I don't know, maybe it's the new norm for some period of time, or it might be forever, I don't know. >> John: We're all learning. >> In the past we had huge conferences that were busting 50, 70, 100,000 and then after the dot-com era, those all shrunk, they're like smaller conferences, and now with advent of companies like Amazon and Salesforce, we have huge events that, like VMworld, are big events. We may move to a environment that's a lot more digital, I don't know what the future of in-presence physical conferences are, but we, like others, we're working with AWS in terms of their future with Reinvent, what Microsoft's doing with Ignite, what Google's doing with Next, what Salesforce's going to do with Dreamforce, all those four companies are good partners of ours. We'll study theirs, we'll work together as a community, the CMOs of all those companies, and we'll come together with something that's a very good digital experience for our customers, that's really what counts. Today I did a webinar with a partner. Typically when we did a briefing in our briefing center, 20 people came. There're 100 people attending this, I got a lot more participation in this QBR that I did with this SI partner, one of the top SIs in the world, in an online session with them, than would I have gotten if they'd all come to Palo Alto. That's goodness. Should we take the best of that world and some physical presence? Maybe in the future, we'll see how it goes. >> Content quality. You know, you know content. Content quality drives everything online, good engagement creates community, that's a nice flywheel. I think you guys will figure it out, you've got a lot of great minds there, and of course, theCUBE virtual will be helping out as we can, and we're rethinking things too-- >> We count on that, John-- >> We're going to be open minded to new ideas, and, hey, whatever's the best content we can deliver, whether it's CUBE, or with you guys, or whoever, we're looking forward to it. Sanjay, thanks for spending the time on this CUBE Keynote coverage of AWS Summit. Since it's digital we can do longer programs, we can do more diverse content. We got great customer practitioners coming up, talking about their journey, their innovation strategies. Sanjay Poonen, COO of VMware, thank you for taking your precious time out of your day today. >> Thank you, John, always a pleasure. >> Thank you. Okay, more CUBE, virtual CUBE digital coverage of AWS Summit 2020, theCUBE.net is we're streaming, and of course, tons of videos on innovation, DevOps, and more, scaling cloud, scaling on-premise hybrid cloud, and more. We got great interviews coming up, stay with us our all-day coverage. I'm John Furrier, thanks for watching. (upbeat music)

>> Announcer: From theCUBE studios in Palo Alto and Boston connecting with thought leaders all around the world. This is a CUBE conversation. >> Hello everybody, welcome to this special CUBE conversation. My name is Dave Vellante and you're watching theCUBE. We're here with Sanjay Poonen who's the COO of VMware and a good friend of theCUBE. Sanjay great to see you. Thanks for coming on. >> Dave it's a pleasure. In these new circumstances, shelter at home and remote working. I hope you and your family are doing well. >> Yeah, and back at you Sanjay. Of course I saw you on Kramer Mad Money the other night. I was jealous. I said, "I need Sanjay on to get an optimism injection." You're a great leader And I think, a role model for all of us. And of course the "Go Niners" in the background really incented me to get-- I got my Red Sox cap and we have a lack of sports, but, and we miss it, But hey, we're making the best. >> Okay Red Sox is better than the Patriots. Although I love the Patriots. If i was in the east coast, especially now that Brady's gone. I guess you guys are probably ruing a little bit that Jimmy G came to us. >> I am a huge Tampa Bay fan all of a sudden. I be honest with you. Tom Brady can become a Yankee and I would root for them. I tell you that's how much I love the guy. But anyway, I'm really excited to have you on. It's obviously as you mentioned, these times are tough, but we're making the best do and it's great to see you. You are a huge optimist, but I want to ask you, I want to start with Narendra Modi just announced, basically a lockdown for 21 days. 1.3 billion people in your native country. I wonder if you could give us some, some thoughts on that. >> I'm, my parents live half their time in Bangalore and half here. They happen to be right now in the US, and they're doing well. My dad's 80 and my mom's 77. I go to India a lot. I spent about 18 years of my life there, and the last 32 odd years here and I still go there a lot. Have a lots friends and my family there. And , it's I'm glad that the situation is kind of , as best as they can serve it. It's weird, I was watching some of the social media photos of Bangalore. I tweeted this out last night. The roads look so clean and beautiful. I mean, it looks like 40 years ago when I was growing up. When I would take a bicycle to school. I mean Bangalore's one of the most beautiful cities in India, very green and you can kind of see it all again. And I think, as I've been watching some of the satellite photos of the various big cities to just watch sort of Mother Nature. Obviously, we're in a tough time and, I open my empathy and thoughts and prayers go to every family that's affected by this. And certainly ones who have lost loved ones, but it's sort of, I think it's neat, that we're starting to see some of the beautiful aspects of nature. Even as we deal with the tough aspects of sheltered home. And the incredible tough impacts of this pandemic across the world. >> Yeah, I think you're right. There is a silver lining as much as, our hearts go out to those that are that are suffering. You're seeing the canals in Venice run clear. As you mentioned, the nitrous oxide levels over China. what's going on in Bangalore. So, there is a little bit of light in the end of the tunnel for the environment, I hope. and at least there's an indication that we maybe, need to be more sensitized to this. Okay, let's get into it. I want to ask you, so last week in our breaking analysis. We worked with a data company called ETR down in New York City. They do constant surveys of CIO's. I want to read you something that they came out with just on Monday and get your reaction. Basically, their annual growth and IT spend they're saying, is showing a slight decline for 2020. As a significant number of organizations plan to cut and/or delay IT expenditures due to the coronavirus. Though the current climate may suggest worse many organizations are accelerating spending for 2020 as they ramp up their work-from-home infrastructure. These organizations are offsetting what would otherwise be a notable decline in global IT spend versus last year. Now we've gone from the 4% consensus at the beginning of the year. ETR brought it down to zero percent and then just on Monday, they went to slight negative. But, what's not been reported widely is the somewhat offsetting factor of work-from-home infrastructure. VMware obviously plays there. So I wonder if you could comment on what you're seeing. >> Yeah, Dave, I think , we'll have to see . I'm not an economic pundit. So we're going to have to see what the, IT landscape looks like in the overall sense and we'll probably play off GDP. Certain industries: travel, hospitality, I mean, it's brutal for them. I mean, and I hope that, what I really hope, that's going to happen to that industry, especially there's an infusion through recovery type of bill. Is that no real big company goes under, and goes bankrupt. I mean kind of the situation in 2008. I mean, people wondering what will happen to the Airlines. Boeing, hospital-- these are ic-- some of them like Boeing are iconic brands of the United States and of the world. There's only two real companies that make planes. So we've got to make sure that those industries stay afloat and stay good for the health of the world. Health of the US economy, jobs, and so on. That's always one end. Listen, health and safety of our employees always comes first. Before we even think about that. I always tell people the profits of VMware will wait if you are not well, if your loved ones not well, if your going to take care of people, take care of that first. We will be fine. This too shall pass. But if you're healthy, let's turn our attention because we're not going to just sit at home and play games. We're going to serve our customers. How do we do that? A lot of our customers are adjusting to this new normal. As a result, they have to either order devices with a laptop, screens, things of those kinds, to allow a work-from-home environment to be as close to productive as they work environment. So I expect that there will be a surge in the, sort of, end points that people need. I will have to see how Dell and HP and Lenovo, but I expect that they will probably see some surge in their laptops. As people, kind of, want those in the home and hopefully their supply chains are able to respond. But then with every one of those endpoints and screens that we need now for these types of organizations. You need to manage them, end point management. Often, you need virtual desktops on them. You need to end point security and then in some cases you will probably need, if it's a remote office, branch office, and into the home office, network security and app acceleration. So those Solutions, end point management, Workspace ONE, inclusive of a full-fledged virtual desktop capability That's our product Workspace ONE. Endpoint Securities, Carbon Black and the Network Platform NSX being software-defined was relegated for things like, load balancers and SDWAN capabilities and it's kind of almost feels like good, that we got those solutions, the last three, four years through acquisitions, in many cases. I mean, of course, Airwatch and Nicira were six, seven, eight years ago. But even SD-WAN, we acquired Velocloud three and a half years ago, Carbon Black just four months ago, and Avi in the last year. Those are all parts of that kind of portfolio now, and I feel we were able to, as customers come to us we're not going in ambulance-chasing. But as customers come to us and say, "What do you have as a work-at-home "for business continuity?" We're able to offer them a solution. So we did a webcast earlier this week. Where we talked about, we're calling it work in home with business continuity. It's led with our EUC offerings Workspace ONE. Accompanied by Carbon Black to secure that, and then underneath it, will obviously be the cloud foundation and our Network capabilities of NSX. >> Yeah, so I want to double down on that because it was not, the survey results, showed it was not just collaboration tools. Like Zoom and WebEx and gotomeeting Etc. It was, as you're pointing out, it was other infrastructure that was of VPN's. It was Network bandwidth. It was virtualization, security because they need to secure that work-from-home infrastructure. So a lot of sort of, ancillary activity. It was surprising to me, when I saw the data, that 21% of the CIO's that we surveyed, said that they actually plan on spending more in 2020 because of these factors. And so now we're tracking that daily. And the sentiment changes daily. I showed some other data that showed the CIO sentiment through March. Every day of the survey it dropped. Okay, so it's prudent to be cautious. But nonetheless, people to your point aren't just sitting on their hands. They're not standing still. They're moving to support this new work-from-home normal. >> Yeah, I mean listen, I forgot to say that, Yeah, we are using the video collaboration tools. Zoom a lot. We use Slack. We'll use Teams. So we are, those are accompanied. We were actually one of the first customers to use Zoom. I'm a big fan of my friend Eric Yuan and what they're doing there in modernizing, making it available on a mobile device. Just really fast. They've been very responsive and they reciprocated by using Workspace ONE there. We've been doing ads joined to VMware and zoom in the market for the last several years. So we're a big fan of their technology. So far be it from me to proclaim that the only thing you need here's VMware. There's a lot of other things on the stack. I think the best way, Dave, for us that we've sought to do this is again, I'm very sensitive to not ambulance-chase, which is, kind of go after this. To do it authentically, and the way that authentically is to be, I think Satya Nadella put this pretty well in an interview he did yesterday. Be a first responder to the first responder. A digital first responder, if I could. So when the, our biggest customers are hospital and school and universities and retailers and pharmacies. These are some of our biggest customers. They are looking, in some cases, actually hire more people to serve their communities and customers. And every one of them, as they , hire new people and so and so on, will I just naturally coming to us and when they come to us, serve them. And it's been really gratifying Dave. If I could read you the emails I've been getting the last few days. I got one from a very prominent City, the United States, the mayor's office, the CTO, just thanking us and our people. For being available who are being careful not to, we're being very sensitive to the pricing. To making sure customers don't feel like, in any way, that we're looking at the economics of it will always come just serve your customer. I got an email yesterday from a very large pharmacy. Routinely we were talking to folks in the, in the healthcare industry. University, a president of a school. In fact, Southern New Hampshire University, who I mentioned Jim Cramer. Sent me a note saying, "hey, we're really grateful you even mentioned our name." and I'm not doing this because, Southern New Hampshire University is doing an incredible job of moving a lot of their platform to online to help tens of thousands. And they were one of the early customers to adopt virtual desktops, and the cloud desktops, and the services. So, as we call. So in any of these use cases, I just tell our employees, "Be authentic. "First off take care of your families. "It's really important to take care of your own health and safety. But once you've done that, be authentic in serving our customers." That's what VR has always done. From the days of dying green, to bombers, to Pat, and all of us here now. Take care of our customers and we'll be fine. >> Yeah, and I perfectly understand your sensitivity to that notion of ambulance-chasing and I'm by no means trying to bait you into doing that. But I would stress, the industry needs you and the tech it-- many in the tech industry, like VMware, have very strong balance sheets. They're extremely viable companies and we as a community, as an industry, need companies like VMware to step up, be flexible on pricing, and terms, and payment, and things like that nature. Which it sounds like you're doing. Because the heroes that are on the front lines, they're fighting a battle every day, every hour, every minute and they need infrastructure to be able to work remotely with the stay-at-home mandates. >> I think that's right. And listen, let me talk a little bit of one of the things you talked about. Which is financing and we moved a lot of our business to increasingly, to the cloud. And SaaS and subscription services are a lot more radical than offer license and maintenance. We make that choice available to customers, in many cases we lead with cloud-first solutions. And then we also have financing services from our partners like Dell financial services that really allow a more gradual, radibal payment. Do people want financing? And , I think if there are other scenarios. Jim asked me on his show, "What will you do if one of your companies go bankrupt?" I don't know, that's an unprecedented, we didn't have, we had obviously, the financial crisis. I wasn't here at VMware during the dot-com blow up where companies just went bankrupt in 2000. I was at Informatica at the time. So, I'm sure we will see some unprecedented-- but I will tell you, we have a very fortunate to be profitable, have a good balance sheet. Whatever scenario, if we take care of our customers, I mean, we have been very fortunate to be one of the highest NPS, Net promoter scorer, companies in the industry. And , I've been reaching out to many of our top customers. Just a courtesy, without any agenda other than, we're just checking in. A friend in need is a friend indeed. It's a line that I remembered. And just reach out your customers. Hey listen. Checking in. No, other than can we help you, if there's anything and thank you, especially for ones who are retailers, pharmacies, hospitals, first responders. Thank them for what they're doing to serve many of their people. Especially people in retail. Think about the people who have to go into warehouses to service us, to deliver the stuff that comes to our home. I mean, these people are potentially at risk, but they do it. Put on masks. Braving health situations. That often need the paycheck. We're very grateful for that, and our hope is that this world situation, listen, I mentioned it on on TV as a kind of a little bit of a traffic jam. I love to ski and when I go off and to Tahoe, I tell my family, "I don't know how long it's going to take." with check up on Waze or Google Maps and usually takes four hours, no traffic. Every now and then it'll take five, six, seven. Worst case eight. I had some situation, never happen to me but some of my friends would just got stuck there and had to sleep in their car. But it's pretty much the case, you will eventually get there. I was talking to my dad, who is 80, and he's doing well. And he said, this feels a little bit like World War Two because you're kind of, in many places there. They had a bunker, shelter. Not just shelter in place, but bunker shelter in that time. But that lasted, whatever five, six years. I don't think this is going to last five, six years. It may be five, six months. It might be a whole year. I don't know. I can guarantee it's not going to be six years. So it won't be as bad as World War two. It certainly won't be as bad as the Spanish Flu. Which took 39 people and two percent of the world. Including five percent of my country, India in the 1918 to 1920 period, a hundred years ago. So we will get through this. I like, we shall overcome. I'm not going to sing it for you. It's one of my favorite Louis Armstrong songs, but find ways by which you encourage, uplift people. Making sure, it is tough, it is very tough times and we have to make sure that we get through this. That jobs are preserved as best as we can because that's the part I'm really, really concerned about. The loss of jobs and how we're going to recover as US economy, but we will make it through this. >> Yeah, and I want to sort of second what you're saying. That look, I know there are a lot of people at home that going a little bit stir crazy and this, the maybe a little bit of depression setting in. But to your point, we have to be empathic for those that are suffering. The elderly, who are in intensive care and also those frontline workers. And then I love your optimism. We will get through this. This is not the Spanish Flu. We have, it's a different world, a different technology world. Our focus, like many other small businesses is, we obviously want to survive. We want to maintain our full employment. We want to serve our customers and we, as you, believe that that is the recipe for getting through this. And so, I love the optimism. >> And listen, and we can help be a part of my the moment you texted me and said, "Hey, can I be in your show?" If it helps you drive, whatever you need, sponsorship revenue, advertising. I'm here and the same thing for all of our friends who have to adjust the way in which the wo-- we want to be there to help them. And I've chosen as best as I can, in terms of how I can support my family, the sort of five, five of us at home now. All fighting over bandwidth, the three kids, and my wife, and I. To be positive with them, to be in my social media presence, as best as possible. Every day to be positive in what I tweet out to the world And point people to a hope of what's going to come. I don't know how long this is going to last. But I can tell you. I mean, just the fact that you and I are talking over video interview. High fidelity, reasonably high fidelity, high bandwidth. The ability to connect. I mean it is a whole lot better than a lot of what happened in World War 2 or the Spanish flu. And I hope at the end of it, some of us, some of this will forever change our life. I hope for for example in a lot of our profession. We have to travel to visit customers. And now that I'm building some of these relationships virtually. I hope that maybe my travel percentage will drop. It's actually good for the environment, good for my family life. But if we can lower that percentage, still get things done through Zoom calls, and Workspace ONE, and things of those kinds, that would be awesome. So that's how I think about the way in which I'm adapting my life. And then I set certain personal goals. This year, for example, we're expanding a lot of our focus in security. We have a billion dollar security business and we're looking to grow that NSX, Common Black, Workspace ONE, and accompanying tools and I made it a goal to try and meet at all my sales teams. A thousand C-ISOs. I mean off I know a lot of CIO's in the 25 years, I've had, maybe five, six thousand of them in the world. And blessed to build that relationship over the years of my SAP and VMware experience, but I don't know. I mean, I knew probably 50 or 100. Maybe a few hundred CISO's. And now that we have a portfolio it's relevant to grant them and I think very compelling across network security and End Point security. We own the companies with such a strong portfolio in both those areas. I'm reaching out to them and I'm happy to tell you, I connected, I've got the names of 1,000 of the top CISO's in the Fortune 1000, Global 2000, and connecting with many of them through LinkedIn and other mixers. I hope I talked to many of them through the course of the year. And many of them will be virtual conversations. Again, just to talk to them about being a trusted advisor to us. Seeing if we can help them. And then of course, there will be a product pitch for NSX and Carbon Black and how we're different from whoever it is, Palo Alto and F5 and Netscaler and the SD line players or semantic McAfee Crowdstrike. We're differentiated so I want to certainly earn some of the business. But these are ways in which you adjust to a virtual kind of economy. Where I'm not having to physically go and meet them. >> Yeah, and we share your optimism and those CISO's are, they're heroes, superheroes on the front line. I'll tell ya a quick aside. So John Furrier and I, we're in Barcelona. When really, the coronavirus came to our heightened awareness and John looked at me and said, "Dave we've been doing digital for 10 years. "We have to take all of the software that we've developed, "all these assets and help our customers pivot." So we share that optimism and we're actually lucky to be able to have the studios and be able to have these conversations with you guys. So again, we share that, that optimism. I want to ask you, just on guidance. A lot of companies have come out and said we're not giving guidance anymore. I didn't see anything relative to VMware. Have you guys announced anything on guidance in terms of how you're going to communicate? Where are you at with that? >> No, I think we're just, I mean listen, we take this very carefully because of reg FD and the regulations of public company. So we just allow the normal quarterly ins. And of outside of that, if our CFO decides they may. But right now we're just continuing business as usual. We're in the middle of our, kind of, whatever, middle of our quarter. Quarter ends April. So work hard do the best we can in all the regions, be available for all of our teams. Pat, myself, and others we're, to the extent that we're healthy and we're doing well, but thank God, is reach out to CISO's and CIO's and CTO's and CEOs and help them. And I believe people will spend money. The questions we have to go over. And I think the stronger will survive. The companies with better balance sheet and unfortunately, some of the weaker companies won't. And I think quite frankly, if you do your job well. I don't mean this in any negative sense. The stronger companies will take share in these environments. I was watching a segment for John Chambers. He has been through a number of different, when I know him, so an I have, I've talked to him about some of the stuff. He will tell you that he, advises is a lot of his companies now. From the experiences he saw in 2008, 2001, in many of the crisis and supply chain issues. This is a time where leadership counts. The strong get stronger. Never waste a good crisis, as Winston Churchill said. And as you do that, the strong will come strong because you figure out ways by which, if you're going to make changes that were planned for one or two years from now. Maybe a good time to make them is now. And as you do that you communicate a vision for where you're going. Very clearly to your employees. Again incessantly over and over again. They, hopefully, are able to repeat it in their own words in a simple fashion, and then you get all of your employees in our case 30,000 plus employees of VMware lined up. So one of the things that we've been doing a lot of these days is communicate, communicate, communicate, internally. I've talked a lot about our communication with customer. But inside, our employees, we do calls with our top leaders over Zoom. Calls, intimate calls, and many, often we're adjusting to where I'll say a few words. I have a mandatory every two week goal with all of my senior most leaders. I'll speak for about five minutes and then for the next 25 minutes, the top 12, 15 of them I listen. To things, I want all of them to speak up. There's nobody who should stay silent, because I want to hear what's going on in that corner of the world. >> But fantastic Sanjay. Well, I mean, Boeing, I heard this morning's going to get some support from the government. And strategically that's very important for our country. Congress finally passed, looks like they're passing that bill, and support which is awesome. It's been, especially for all these small businesses that are struggling and want to maintain full employment. I heard Steve Mnuchin the other day saying, "Look, we're talking about two months of payroll "for people if they agree to keep people employed. "or hire them back." I mean the Fed. people say, oh the FED is out of arrows. The Feds, not out of arrows. I mean, I'm not an economist either. But the Fed. has a lot of bullets in their gun, as they say. So Sanjay, thanks so much. You're an awesome leader and really an inspirational executive and a good friend so thank you so much for coming on theCUBE. >> Dave, always a pleasure. Please say hi to all of my friends, your co-anchors, and the staff at CUBE. Thank them for all their hard work. It's a pleasure to talk to you this morning. I wish you, your family, and your friends and all of our community, stay safe and be well. >> Thank you Sanjay and thank you for watching everybody. This is Dave Vellante for the cube and we'll see you next time. (soft music)

>> From the SiliconANGLE media office in Boston, Massachusetts, it's theCUBE. Now here's your host, Stu Miniman. (techy music) >> Hi, I'm Stu Miniman, and welcome to a special CUBE conversation here in our Boston area studio. Happy to welcome to the program first time guest, Patrick Morley, who's the CEO of Carbon Black. Of course, recently announced acquisition by VMware of $2.1 billion. Patrick, thanks so much for joining us. >> Stu, thanks for having me. >> All right. So, you know, we love digging into tech. There is no hotter space than security, you know? All the cybers are, you know, really exciting stuff, and even your company's Waltham-based. >> That's right. >> So actually a little closer to Boston than we are here in Marlborough, Massachusetts. When we had a green screen we used to kind of fake it with the skyline, but you know, the Boston area people know more than just Massachusetts Tech, but you know, a lot of, you know, great technology in Boston of course, you know? A lot of good technologies, a lot of good schools that have driven things. You have been CEO since 2007 and have seen quite a bit. You know, merger, Bit9 and Carbon Black many years ago, IPO, you know, not that long ago in the past, and now acquisition, as we said, for $2.1 billion. So, you know, give us a little bit of step back as to, you know, the journey, how we got here, and you know, what's it like to be kind of at the helm with your crew through, you know, all of those changes? >> Yep, well certainly very, very proud and very thankful to all of the customers that have been with us for many, many, many years. And as you said when you first started here, Boston is an awesome place for cybersecurity. I think I fits a bit of the personality on the East Coast, and if you just look at Boston in general there's a lot of great cybersecurity talent, a lot of great cybersecurity companies. And I'm extremely proud and grateful to all of my employees in Massachusetts who have built Carbon Black over the last number of years. And of course we have offices elsewhere across the globe, but Boston is, and Massachusetts is, where the companies roots really come from. And as you said, 2007 is when I joined the company. Obviously cyber was a very different world back then, and it's amazing if you just kind of roll back. In 2007, the idea of a CISO, of a chief information security officer, was still very new, and most companies we dealt with back then did not have a CISO, they had a network administrator or somebody, so that's all changed. If you look at security as a board-level issue, in 2007 there were certainly some areas of some sectors like the government where it had a lot of importance, but outside of that it did not have the same visibility as a strategic issue as it does now, it's been amazing. >> So much, you know, my background is networking and virtualization. I've spent a lot of time, you know, since 2007 looking at all the cloud world, and as I said, back in the early 2000s security was top of mind but often bottom of budget. You know, the network people, you know, back in the day it was like, "Can't you just lock the door," or you know, "Make sure the rack is secure," and you know, "Well we'll run things over Optical," and therefore we'll know if somebody splices into it from a networking standpoint. Today, as you stated, clearly it's a board-level discussion, CISOs, you know, rising power in the organization, and often dictating a lot of how the stack is built out there. >> Absolutely. >> So wow, bring us a little bit, you know, your portfolio. You know, security is not a thing. You know, any customer I talk to, they're like, you know, there is no such thing as a silver bullet in security. Most customers I talk to really think of security as a programmatic effort, so help us understand a little bit, you know, where Carbon Black fits today, and then we'll get into, you know, your, you know, broadened scope once you're going to be under VMware. >> Yeah, so the core founding idea behind Carbon Black was a simple one, which was that fundamentally the adversary was in a position where they eventually would figure out a way to get in, and if you fundamentally believe that then you do everything you can to stop the adversary, but you say, "I need telemetry. "I need data in order to understand what's happening across my environment in order to be able to see and stop the adversary." And so we began a journey to essentially be able to collect and analyze all the data that an adversary, that an attacker would touch in order to run their program, and you know, we always have equated it to essentially a movie camera that allows you to rewind the tape, and with all that data that we collect we can run tremendous analytics against that in order to be able to see and stop the adversary and understand what's happening across the environment. We essentially created a market that's now called EDR endpoint detection and response, and it's that simple idea of being able to understand and have situational analysis, situational visibility across the whole enterprise. We did that initially on-premise, so we did all that analytics, and each one of our customers' back-ends in their data center, and two years ago we began a journey to say, "Look, we want to do two things." One is we want to leverage that data to be able to provide more security capabilities across a platform, so let's revolutionize, continue to revolutionize cybersecurity by offering a cloud-based platform, we're going to move all of that analytics up into the cloud, all those capabilities up into the cloud, and offer a multi-tenant, cloud native SaaS platform, and over the last two years we've done that with multiple services now up on that cloud, with thousands of customers who are using it, and the benefits of the cloud are pretty straightforward, and they've revolutionized other industries, they're revolutionizing cyber right now. Certainly you can analyze data at a scale that's just not possible when that data's locked up in multiple customers, so that's one big change. Obviously-- >> Yeah, I just, to want to help unpack and tease out that data piece, because you know, we always hear out there it almost, you know, is a bit trite, you know, the importance of data. Data's the new oil, it's the rocket ship, but you know, the value of that data, how much of that is Carbon Black leveraging the data, how much can the customer themselves take advantage of that data, or you know, this isn't in a vacuum. There are other security products, other pieces of, you know, that vendor's stack that might be able to leverage that data. >> Yeah, well Carbon Black's cloud native platform, security platform, is built on a totally, it's totally open, so from an API basis, so you should, you should think about, our customers certainly think about it this way, as one, we're leveraging that data, we analyze a trillion security events a day, one trillion, just immense, and the benefit of that is if we see something across the globe that has a high risk score, that's known malware, that might be a new form of attack, that might be a living-off-the-land attack, all of our customers get the benefit of that analytic. So Carbon Black, we certainly leverage it, but in addition, the way we've built the platform, customers can get access to all the data from their enterprise, and they can correlate that data with other aspects of their security or their IT infrastructure in order to build a more holistic view across the entire enterprise, and we also have third party partners out there, managed security service providers and others, who also have access to that data for their customer set to be able to run analytics on it. So when we think about data, as you said, you know, as the oil of the new world, we need to leverage that data, but we also need, in this new world order, to give our partners and our customers the capabilities to do what they want with that data as well for their own data. >> Yeah, love that, especially if you're talking in that cloud native world it can't just be something that's locked up and only used in one environment. You know, we track the observability companies out there, you know, they have similar type of messaging. Of course data protection, you know, once there is that, you know, breach, you know, how do I recover from this information? So that ripple effect, and love, you know, openness, APIs, making sure that can be shared. You know, maybe not something that traditionally I'd heard from VMware when you talk about the openness and where they're doing maybe. I think there are a couple things you want to talk about Carbon Black, but why not get to the VMware piece, too? >> Yeah, I was just going to, on the cloud side, you know, the power of the cloud, obviously it's revolutionized other industries, and certainly one of it is the ability to provide analytics at scale. The other piece, which I already mentioned, is the network effect on my ability to see something somewhere across the globe and help millions of other customers across the globe when I see something, and the other piece is just my ability to deploy quickly and my ability to innovate quickly, because rather than having to deliver new software into each enterprise I can do that on my cloud native platform. So I think it positions the defender, the security teams around the globe where they can be more on the offensive than they've ever been before because suddenly I don't have to spend my time worrying about deployment mechanics or other pieces. I can focus on what I really want to do, which is I want to secure my environment, I want to be able to understand what the adversary might be doing. So we're real excited about what we've done over the last two years with our cloud platform. >> Okay, so the deal hasn't closed yet but it's announced that you will be leading up the cloud security group at VMware. Give us a little bit, you know, directionally, where's that heading, what will that mean? Of course we've tracked, you know, where VMware touches a lot of that environment, you know, with my background in networking I talked to the Nicira team before, and then through what's become a very successful NSX, Sanjay Poonen with the AirWatch acquisition and where they've gone. Of course I would expect that's the closest piece that you started out with the endpoint protection with that team, with the Workforce ONE. So explain kind of the security portfolio, and interesting, cloud security is the discussion because that's the newer piece of the Carbon Black portfolio. Help us understand how the whole, all the pieces fit together. >> Yeah, so first I'll just reiterate what you said, which is the transaction's not yet closed, so everything I'm talking about is pre-closed, and obviously post-close we'll have additional commentary about what everything will look like. But absolutely we are very, my team, my customers, we announced the transaction a little over a month ago. Everyone was really, really excited, and I think fundamentally they're excited because organizations understand what Carbon Black delivers today, and what we deliver are great security products, and increasingly the majority of those products are in the cloud. And VMware has a tremendous reputation in the industry for the technical capabilities, for the value that they provide to customers, and just for the breadth of the portfolio that they have. You mentioned a few of them, right? And many organizations and people think about VMware from a virtualization standpoint. But increasingly over the last few years they've dramatically expanded their portfolio, network virtualization, and the NSX, the Workspace ONE as well, which was based on the AirWatch acquisition they did. Those are big businesses today, and they're helping organizations transform their infrastructure, the way they manage devices, et cetera. And so Carbon Black, on the security side, we've been partnered with VMware for the last couple of years. We've had an opportunity to get to know each other quite well. We've had an opportunity to integrate in two key spots. One, we've integrated with their App D capabilities, which you can think about essentially as helping to protect and provide telemetry for what's happening inside of the virtualized environment. And then secondarily, we've also partnered with Workspace ONE as well, again more on the device side. Those are two natural points where security, building security intrinsically into that compute stack, we've seen with customer reaction, has a fundamental impact on being able to have security right there rather than having to bolt it on afterwards. >> Yeah, you walk into an interesting configuration. First of all, you know, as you said VMware not thought of as a security company per se, lots of products that absolutely fit in the security space and are there. When you look out, of course VMware, you know, primarily owned by Dell, there's Secureworks, there's RSA, those are well known security brands. You know, how, give us how you think of how all those pieces go together and kind of the trajectory of where things are headed. >> Yeah, well goal number one, once we close the transaction, goal number one is to do two things. One, we're going to continue to drive forward with the cloud roadmap that we have. It's an aggressive road map we've been innovating aggressively over the last couple of years and we're going to continue to do that within VMware. The second piece is obviously to maximize the opportunity to build security into the compute stack of VMware, so that when customers think about security they don't have to think about it as a separate piece, but it's already there at their fingertips. And then as you mentioned, so those are two big goals right there, and as you mentioned obviously Dell has a large portfolio. There's other security products within the Dell portfolio, and you know, when we think about that obviously over time we're already partnered with some of those. Secureworks, for example, has been a very close and valuable part of Carbon Black's for many years. You'll see us continue to partner. There's other parts of the Dell family where we have partnered in the past, not tightly, but I think we'll have the opportunity to do more as part of the Dell family. All of this means for customers more value, because rather than having to go and figure it out themselves we're going to be delivering it in conjunction with the solutions they're already using. >> All right, Patrick, I want to help you, have you address a schism I see in the marketplace when it comes to the messaging around security. When peers of mine went to the RSA conference this year they came back almost unanimously with two words, doom and gloom. >> (laughing) Right. >> In Boston this year Amazon held the inaugural re:Inforce, positioned itself as the, you know, cloud security conference for the industry. We covered that, you know, both of those shows with theCUBE, and Stephen Schmidt from AWS said the state of cloud security is strong. VMware, very much we hear from Pat, you know, we need to do over, security's broken. Friends of mine in the security industry, and Carbon Black's been around since 2002, is you know, come on, you know, it's not just another acquisition, it's going to be a point product. You know, yes we have work to do as a whole, but you know, saying we need a do over or it's broken is a between hyperbolic from my peers in the industry, so what is the state of the industry, is there traditional storage and cloud storage is all rainbows and unicorns, or you know, where do you see it today? Of course we know as an industry there's always work to do, but you know, how do you round that circle? >> Yeah, I would take it, and you're right, by the way, I hear all the same commentary, and I think we have to take a step back and just look at industry, the industry in general, look at security in general. We started the interview talking about well, what was the world like in security in 2007? Security has gone from, "Hey, it's a niche area over here "and we know it's important but don't talk to us," to super strategic, again, at a board level, at a company level, and so that rapid growth has driven a lot of funding into the environment, a lot of vendors, there's over 5,000 security vendors out there today, all competing. I don't know how CISOs and CIOs and practitioners really figure out who does what, it's very challenging, and at the same time you've got the adversary, this third party continuing to advance their attack types using new techniques. You've got ransomware, which is a huge industry now, driving billions of dollars, so you have all of that happening, and so in hyper growth environments like that you get a lot of vendors. The average enterprise security team has 75 different products, and so, and they have to stitch that together, so the fundamentals of what, the way you described it I think are accurate on both sides. One, security's broken, it is broken. We've got too many vendors and we're bolting it on, we got to fix that. VMware is in a position, partnered with Carbon Black, to do that I think really well. The second piece is that the cloud does allow us, I'm not sure about rainbows, but the cloud does allow us to change security fundamentally because of some of the characteristics that I described earlier, and if you take Carbon Black plus VMware, plus what VMware is doing to deliver across any cloud, any device, any application, I think we're in a really interesting spot to help customers get more value from their compute stack and from security. >> You know, one of the things that VMware has always done well is they play in multiple environments. Back in the early days of server ritualization, didn't matter what hardware, they would get that across. Their cloud strategy went through quite a few iterations, you know, Sanjay Poonen came on our program and said, you know, "vCloud Air, we failed. "We got it wrong, we did it," but today every cloud show I go to there's a VMware piece of that. They're partnering with AWS, with Azure, with Google, with Alibaba, with Oracle even-- (chuckling) And IBM recently. But still one of the critiques I have for VMware is VMware does good at managing their house, but security, customers, as you said, they've got 75 tools and they're going to have their VMware state, and they're going to have their native cloud pieces, and they're going to have their non-VMware environment. So how can, you know, once you're under VMware, you know, participate in that environment? Will you primarily be VMware environment and the VMware cloud environment, or will it be a broader cloud security strategy? >> Yeah, well I think certainly VMware has done an amazing job over the last few years of really pushing this any-cloud model, right? "Hey, no matter where your workloads "are going to be in a hybrid cloud environment," you know, "we're going to be there to help you," and more effectively, more efficiently, faster, better performance, strong ROI. And so if you look at Carbon Black's roots, and I mentioned this earlier, one of our core beliefs is that one vendor can't do it all. You have to build on an open, extensible API-based platform, and that's what we've done since the beginning of the company, and so you will not see Carbon Black change our philosophy. You know, we will continue to be very, very open, and I think, by the way, that reflects very much VMware's strategy as of late, which is an open strategy where they're playing with lots of providers in the marketplace. Again, the benefit of Carbon Black plus VMware on that platform is that for VMware infrastructure, their products, I think you're going to see out of the box security capabilities that are going to give advantage to customers, from ease of use, from the way that that security works, et cetera, and then we will continue to partner with other vendors out there across the market. >> All right, Patrick, we know, you mentioned how many different tools customers have to deal with. There are more new threats coming out, you know, every day. There's no way that a person or a team can keep up with all of this, so you know, is AI the answer? How are these technologies going to be able to allow our systems to be able to protect us better and update, you know, we haven't talked abut AI yet. I know it does fit in-- >> We have to talk about AI. (chuckling) >> So just to understand how you know, the systems and the software and the solutions are going to help enable teams to be able to keep up with, you know, the rapidly expanding and changing landscape in security. >> Yeah, AI is a tool, we use it, and just as I've mentioned cloud, right, along with the ability to analyze trillions of events on a daily basis, things like AI can play a very significant role in helping me to understand what's happening across very large corpuses of data, and so we use a lot of it, and that allows us to understand when there's an anomaly somewhere across the globe on some system, some endpoint or device, anywhere across the globe and then leverage that to help our other customers. So AI role is playing an important part. It will continue to play an important part. But AI leverages the data that we collect, so if you go back to where Carbon Black is today with all that data that we're analyzing, one of the really interesting things is VMware today has 70 million VMs. 60 million of those are on-prem, 10 million of them are on the cloud. Part of the benefit that Carbon Black gets from VMware is we're going to get all this additional telemetry that we're going to be able to, again, consume, leverage AI capabilities to help with the analysis of that, and again, provide more customer back to the value on seeing and stopping the adversary. That also extends to what VMware's doing on the device side with Workspace ONE, et cetera, so there's a lot of opportunity over the coming quarters and years to provide more value for customers in understanding what's happening across their environment because of all of the touchpoints we're going to have as part of the VMware compute stack. >> All right, Patrick, final thing, what does this mean for your customers? You know, I think back to, you know, not that long ago you did an IPO, you know? What would that mean for the growth, the investment into technology and growing the team. Now, you know, in industry parlance, you know, you had another exit and you will be part of VMware, so we might not get as much visibility into the specific revenues and the hiring that you're doing there, but what will this ultimately mean for Carbon Black's current and potential future customers? >> Yeah, so we have over 5,000 global customers out there today, and first and foremost it's going to mean more investment from a product roadmap standpoint. If you look at 2019, this year, the number one area of investment for Carbon Black was in R&D, and as we move forward, again post-close, our customers are going to see continued investment in the platform, in our cloud security platform, in order to ensure we continue to bring more capabilities to market. And then, as I said earlier, in conjunction with that do everything we can to integrate in with the VMware product portfolio, again, so that security's not bolted on but it's intrinsic to the compute stack, and so I think that's the biggest thing. I have had the opportunity to go out and speak to many customers over the last four weeks. Customer and partner reaction has been outstanding. They get it, they understand it, they understand that there's a better way and that's what we're going to be doing as part of VMware. >> Yeah, any surprising nuggets in the last month talking to the customers and partners more that you've learned? >> This is going to sound self-serving, but it's the truth. I will tell you that the VMware reputation out there is outstanding. I mean, and I had been surprised at how little I have to do to tell them why this makes so much sense. They get it, the majority of our customers get it. They understand the possibilities of what we can provide, and there's a level of excitement out there, again with our customers and partners. It's just, it's awesome. >> All right, Patrick Morley, CEO of Carbon Black. Thank you so much for joining us on theCUBE. >> Stu, thanks. >> All right, lots of coverage, of course, through 2019 and gearing up for 2020 where we'll all have perfect hindsight, I'm sure. Check out thecube.net for the events we've been at, search where we're going to be, and please reach out if you have any questions. I'm Stu Miniman, and as always, thank you for watching theCUBE. (techy music)

>> Narrator: 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. >> Hey, welcome back everyone. We're here CUBE live in San Francisco, California, VMworld 2019. We're here in Moscone north lobby. I'm John Furrier with David Vellante, my co-host. Three days of coverage. Our next guest is Steve Wood, chief product officer at Dell Boomi. Steve, thanks for joining us today. Appreciate you coming on. >> Thank you. >> So we got your event coming up in DC. theCUBE will be there covering it. >> Correct, yes. >> We've been following you guys. Interesting opportunity, you're the chief product officer, you got the keys to the kingdom. You're in charge. (laughs) >> Yes sir. Oh yeah, yes. >> Tell us, what products, roadmap, pricing, all the analysis. >> (laughs) >> Take a minute to explain Boomi real quick for the folks that might not fully understand the product idea. >> Sure, yeah, yeah, absolutely. I mean, Boomi is a platform. The goal of the platform is to solve really tough technical challenges that you often meet in order to get to a business outcome of some kind. So if kind of brought that into maybe sharper focus, if you like. So Boomi started its life as an integration vendor. And its main goal is actually making it super easy to integrate your assets across cloud and on-prem. And that was a challenge at the time. A lot of the older integration tools weren't really ready for the cloud. Boomi brought forward this awesome architecture, this distribution architecture of containers that could run anywhere, integrating everything, moving your data around as needed. >> It was visionary. >> It was super visionary. >> I mean, it was early days. I was like, almost pre-cloud. >> Yeah, yeah, yeah. And actually, what was the cool thing was that you would have the benefits of cloud computing but you still could run something, like, behind your firewall, which was a really unheard of experience. Which actually starts to sound a lot like today, with Edge. But I'll kibosh that. But then, we sort of expanded into B2B, so you can connect to like, Walmart with all the sort of traditional and sort of modern protocols, kind of stuff that's been around for a while. We launched Hub for data quality, 'cause we felt like, hey, if we're connecting all of your data together, you're probably going to find it's fairly inconsistent. So we have Hub to help you manage your data quality. And then we moved into API management. We've done a huge investment this year to API-enable your integrations, but also API-enable your enterprise. And then possibly my favorite, 'cause it's an acquisition of my company, which I joined Boomi, acquisition of a workflow business. So actually not only provides workflow for people-centric processes, so really the connecting the dots from your devices and things and your infrastructure, on-prem and the cloud, all the way up to your people, driving those end-to-end experiences, but we also use the workflow product to help extend our existing products. >> So you were building a platform in your other company, and now Boomi's also in the same ethos, API-based, DevOps, complete DevOps, kind of no-code, low-code kind of thing. >> Steve: Low-code, yeah, for sure. Absolutely yes. >> What is, so what did you guys jump on, which wave is powering you guys now? Because I look at VMware, for instance, they have all these acquisitions. Their integration's going to be challenging. And just, most enterprises that are not born in the cloud, I mean, their legacy is, they got everything under the sun. And they're not necessarily talking to each other. It's a huge problem. >> No, for sure it is. And actually, it's become more of a problem as we move into machine learning and sharing data across enterprise, given access to the data for sure, ensuring it's controlled. So there's a lot going on. I think also for us, we're seeing obviously data's getting faster, you know. So as I often joke internally, nobody's asking for less data slower. >> (laughs) >> And we don't think that the volumes of data are going down anytime soon. So for us, it continues to be about the data. That for sure is the trend, the fact that it's moving faster, it's needed faster. We're going from batch to streaming, going from, you know, request-response to real-time. >> So what problems do you guys solve? You had to be nailed down and give up the problem statement, what is the main problem statement that you guys are addressing today that's most relevant? >> Yeah, the biggest problem is actually, I would say it's just unlocking your data. But in the fastest time possible. So when Boomi kind of, I guess, does well in the market, it's because we bring kind of enterprise creds, we bring you a journey to the cloud, not a cloud-only picture. We're not lookin' on-prem, tryin' to be retrofitted to the cloud. So what customers experience is they get the agility that they expect, so they get the value very, very fast. But they're also kind of ready to kind of make that transition from bein' on-prem, legacy, big vendor type, ERP, massive system to best of breed. And we help them with that change. >> I always say that, to David and I chattin', just really DevOps is about Dev and Ops, right? You want to have a great development environment so you can build those next-gen apps, which by the way, they need data, they need machine learning, all these new things are going on within microservices. It's very compelling, and everyone kind of knows that already. Or they should know it. But the dev scene's lookin' good, CID pipeline, good scene on the dev side. It's the ops side. (laughs) So I've seen a lot of enterprises really tryin' to catch up their operations, which is why VMware is continuing to do well, because they got operators. So I get that, like, they're not going to shift overnight to the Nirvana. But the role of developing and operating that app is ultimately the core digital transformation. >> Yeah, for sure, for sure. >> John: Your thoughts on that and what you guys are doing? >> Well, part of it also, like, when we looked at, so actually with the acquisition of Flow, I think it was interesting for us because it moved us also to be able to provide apps. So for example, VMware has something called Workspace ONE, which is their onboarding, help the employees onboard within the organization, connecting you to your endpoint applications. We're actually working with them on a similar thing. We have an onboarding solution to help employees onboard faster. But part of, I think, the value that we bring is that apps have traditionally, you know, been something that's heavily coded, they take a long time to do. So from integrations being heavily coded to APIs being heavily coded, and now for us, apps being heavily coded, is we kind of solve those tough types of challenges, everything from like, mobile and offline to APIs that are scalable and robust, through connecting to all of your systems including your things, and having the ability to do that. We kind of solve all of that so you can focus on what, so the true innovation. But like any cloud vendor, even if you leave it alone, it's getting faster, richer, better. So you know, it's unlike, say, coded solutions where they kind of sort of, they're a snapshot of that point in time. And if you leave them alone, they kind of slowly fade away, whereas Boomi is, we're constantly modernizing what you build on our platform. >> So the other piece about digital transformation is the data. And then you're talkin' about your data quality and information quality initiatives. That's kind of in the tailwind for you guys. So where does it all fit in terms of digital transformation, data, some of the things you were just talking about, and then the rest of the Dell family, Dell, VMware, how does it all fit together? >> Oh, sure, okay. Yeah, that's a lot. But yeah, I'll see if I can sort of give the gist it. Well so partly actually for us is like, getting data out. It feels like if you're going to transform your business, you kind of need to know what data you have. That feels like a fairly normal thing. But also, and I can't, I'll give you a teaser. We can't say more about it. But one of the things that's been interesting about the data on our platform, our metadata, which is anonymized, we have more customers for the longest time running on our cloud service, which is a multi-tenant service, which means we see how the 9000 plus customers work with other systems. And we have the metadata of how they architect that connectivity across the board, all the way out to people, all the way down to their infrastructure. We can see what's going on. So we've been doing a lot of research. And actually, showing you more about what your business is doing. And we have some really cool announcements coming up at Boomi World. >> So the truth in the data. I'm imagining machine learning. But you get to see the patterns. >> We get to see the patterns. >> Emerging. The signals, there's signals. >> Yes. And we're seeing the patterns not only in what's being built and the structure of what's being built, but how it's operating, how it's being deployed, what's most successful, how those things work. So we have a really interesting sense. So when you're going through a digital transformation, we think we can show you things that you'll not have seen before. >> So what are you showing and to whom are you showing it? >> So it'll be at Boomi World on the first of October >> (laughs) >> In Washington. So I can't say more than that. But we're going to show them some things that our platform can extract for you that we don't think any other vendor's done before. >> And today, how do you visualize that? >> Well, today actually we don't do that much to visualize it, actually. That was actually, so we've been on a real machine learning train for the past couple of years. And as we got really good at understanding the metadata we have, and we've got the data scientists involved, they started showing us more of the art of the possible. So for that I'd say we've been probably remiss in not helping customers more, exposing more of those insights. Obviously, from a transformation perspective, we unlock your data. But we think we can do a lot more. >> So is the Dell relationship largely a go-to-market one? Same question for VMware. >> Well I'd say, like, if you think about Dell, it's like, I guess, I dunno, the sort of unofficial, so the hardware part of the triangle, VMware being the server infrastructure. >> Don't tell them that. >> Yeah, sorry. >> But it's true. (laughs) >> Yeah, sorry Michael. But it's the hardware side. And VMware you've got the kind of infrastructure, DevOps, operational side. And then Boomi brings you the data. And we think that that kind of triangle is what you need to go through a digital transformation, certainly if your title is CIO. >> And Michael Dell's bullish on you guys. He was at your last event we broadcasted. He sees you guys as modern SAAS interface for companies, certainly from a transformational standpoint, as the interface in for integration. >> Yeah, for sure. I mean, it will, I guess some of our performance speaks to that. I mean, we've been a very, very high-performing, I don't want to say we're the number one performing technology in his portfolio, but it's certainly, it's either-- >> Well, you're up and to the right. That quadrant thing. >> Yes, quadrant, yes. >> What's the winning formula? Why are you winning these deals? Why are you winning customers? Why are you keeping customers? What's the real value that they're getting out of Boomi? >> So our CMO would want me to say, business outcomes accelerated, which is, hopefully you got that. >> Check, got that down. >> Oh, yeah, yeah. (laughs) >> Gold star for you, go. >> Thank you, thank you. >> Now, the truth. (laughs) >> Now the truth. (laughs) It's actually, but it is time to value. I mean, our customers, that's the, because we've solved the challenges, sure. Other vendors can say, we've solved the challenges too. But we've solved it in a low-code way, and customers see the value very, very quickly. So when we go, you know, head-to-head with a competitor on a deal, you know, like a bake-off if you like, we win pretty much every time. >> Take a minute to explain what low-code is for the folks that are, been debating what low-code is. Been a lot of Twitter wars on this. But explain what low-code is. >> I will give my explanation, sure. So low-code fundamentally is the idea that, you know, I'd say, like, the first phase, almost, of cloud, was like, hey, you're not going to code anything. The new paradigm is it's all point and click. And Salesforce, actually I used to be at Salesforce, I sold my last company to Salesforce. It was all about kind of like, the no-code approach. But I think reality is, it's like, there's different ways in which you can be productive. Sometimes point and click is by far the most productive, but it is not always the most productive way to solve a problem. Sometimes code is by far the most productive way to solve a problem. So when you provide a low-code platform, what you're really thinking about is productivity for everybody, not just the point and click, drag and drop, ease of use, but also productivity for the developers. So when they engage and they're working together to deliver a solution, it's highly productive. >> For instance, wiring up APIs is a great example, or managing containers might be a great use case of low-code. No code would be just, you know, more automation behind the simple stuff. But low-code is really more stitching stuff together. >> Yeah. And sometimes people do associate it more with application creation side, but I often think of it as, like, a role thing. If you think about, like, your company, one solution to solve the kind of app gap, or the gap in all the stuff in your backlog that needs to be done, is to hire more IT people. The other way to solve the problem is to empower everybody you have to do more with technology. So I often think about it as like, you know, software eating the world, you know, a lot of people are on the wrong side of that equation. You know, they're-- >> You talk to people who are cloud-native, or born in the cloud, their IT is the developer. I mean, they're the ones managing the configurations, and it's all either scripted away or written code for. What was IT's job? (laughs) >> You say a lot of people on the wrong side of that equation, you mean customers? >> No, I mean, well, people inside the business are often like, you know, they've got a whole bunch of stuff they want to do with technology, but there's a gatekeeper, and that gatekeeper is the developer. And it's not that they want to be a gatekeeper, it's that you need tools to be able to do it. They want to be sure the architecture's right. So low-code platforms are all about kind of bringing more people into the conversation. So I often think about it as like, take the business, and so say, your ideas don't now get translated through a whole bunch of series of weird things, you can now be very engaged in the creation process. >> So it's domain expertise meets coding capability. >> It reminds me of the old 4GL days in the '80s. You know, you had interpreters, scripting languages, kind of higher-level of abstractions. But the underlying language is hardcore, compiler, object code, you know, all that stuff under the covers has to be there, right. That's, you're putting that abstraction on top, making it easy to code. >> Yeah, absolutely. 'Cause like, I mean, what you deploy has to be credible. So what the low-code vendors are after is something where an architect would go, love that, that thing is great, I love the way it's put together, it's well-architect, well put together, and I can code around it to finish those last small issues, and kind of, you know, add my shine to it. >> 'Cause they know what they're dealing with. >> Yeah. >> Under the covers, at least. >> Yeah. But a lot of like, you know, the no-code vendors kind of went for architecturally slightly curious routes and didn't necessarily think about the whole picture. >> So you guys are all about dealing with all this complexity, helping people manage that, at least a part. How about some of these new innovations that are comin' out. I mean, the world's crazy about ML, AI, blockchain, you know, all kinds of new automations. Where do you guys fit into that? Is that an opportunity for you? >> Yeah. I mean, well, so machine learning, we're all, oop. Sorry, I tried to spill my water. We're all crazy about machine learning as well. So we're using it a lot, as I mentioned, on our metadata. But also, we see a lot of our customers using our technology to get the data out in order to surface new insights. So for example we've got, like, actually Jack in the Box would be an interesting example of kind of emerging technology. One is that they're using our technology to get data out at the point of sale. So they have to use, our technology is running at the point of sale. They have 2200 plus locations, which means we have to be able to run out there on the edge and process it right at the point of sale. But they're trying to do things like, you know, when you drive up and your license plate is scanned, they know who you are, they go, hey do you want those, that same meal again. You know, so they can predict what you want, they can help make suggestions for you. So that's a fantastic example. So, yeah. >> Great edge use cases. I mean, that's awesome. >> And then, which is one of them, but there's also, machine learning for us, we're tied with machine learning. And we are exploring the idea of actually providing machine learning as a service to our customers. That's something we're just, we're sort of eyeing that up as we've been doing more and more internally. But blockchain's the same. And we see customers playing with blockchain all the time. And actually, I guess, our pitch to customers who are looking at emerging technology is we have a group that is looking specifically at emerging technology. And because of our time to value, and because often, emerging technology is like, so what does blockchain mean to, I dunno, well, you guys, theCUBE. >> John: Supply chain. >> Steve: You know, like, how would you use it? You might want to experiment with it. >> We have a CUBEcoin. >> You have a CUBEcoin. >> And we have a reputation protocol, and we have a community software layer. >> It's actually working. >> I would track the supply chain. >> You're going to do it? >> I already built it. (laughing) It's in tech preview right now. >> Okay, well good, good. Hopefully you did it on Boomi, that'd be nice. (laughing) >> No, but I mean like, the success or maybe failure of CUBEcoin, I don't want to call it, but you know. >> It's not a utility token. Well maybe, nah. >> Right. (laughs) But like, a lot of customers want to build to experiment, so time to value's really important. We're solving those problems in those emerging technologies. >> Yeah, rapid application development and DevOps, using containers, APIs, very friendly. >> Try it out and then see, like, does this make sense? >> All right, so you got the event coming up October first to the third in Washington DC. You get a plug for that. >> I might've mentioned it. >> theCUBE will be there. You're holdin' back on some of the good stuff. The good items. We'll wait for then. >> Yeah, otherwise, yeah. Wait for the keynote, then you'll see, yes. >> (laughs) They all want to know now. Come on. (laughing) They're all like, no, don't say anything. All right. We'll leak it on Twitter later if I find out. No, no. Steve, thanks for coming on and sharing the insight. We're looking forward to chatting more at Boomi World in Washington DC. I'm John Furrier with Dave Vellante. More live coverage here in San Francisco for VMworld 2012 after this short break. (electronic music)

>> Live, from Washington DC it's the Cube. Covering AWS Public-Sector Summit. Brought to you by Amazon Web Services. >> Welcome back everyone to AWS public sector here in Washington DC, the Cube's live coverage, two-day coverage, I'm your host, Rebecca Knight. Co-hosting alongside John Ferrier, and we are welcoming back to the Cube, 13 time Cube alum, Sanjay Poonen in the COO of VM-Ware. Thank you so much for coming back on the show >> VIP status, by the way. >> Yes, absolutely. >> Thank you, Rebecca. >> That's definitely VIP status. >> Yes we have a red carpet rolled out >> Delighted to be here. I've lost track of the number of times, but when you're having fun it's good. >> Exactly, so tell us a little bit about what is VM-ware's role here in the public sector, what are you doing here at this conference? >> VM-ware and AWS announced a partnership in October 2016, and it really was the coming together of the best in the public cloud, with the best in the private cloud for what we describe as the hybrid cloud opportunity. And the past two and a half years, coming up on three years pretty soon, has been incredibly exciting. We started off with some of the key industries that we felt, for us, the public sector is among our top three industries. But financial services, telco, public sector, healthcare, manufacturing, all the key industries, technology, we're looking for ways by which they could take their applications into the cloud without having to re-factor and re-platform those applications. That's a big deal because it's wasted of work, if you can lift and shift and then innovate. And that's the value we brought to the public sector and some of our earliest customers, were customers in the public sector like MIT, schools, most of the regulated industries. In the on premise world, we're very strong in almost every, civilian, military, the legislative advance, the judicial advance, the federal agency, all of them use us. Millions and millions of work loads. The question really is how is they think about modernization can they get the best manifesto of the public cloud while leveraging their VM footprint >> So some would say that modernization may not include the original VM-ware vision because a lot of the governments are tryna replace and equated old systems like coldblow, mainframes, whatever, but you guys have been around dominated the operating side of IT for a while so you're kind of seeing the first wave of virtualization, the first wave of modernization but there's some cloud native people they might see that as like "Whoa, is that old school?" So what is particular perspective on that innovation dynamic? Because a lot of the public sector investors are awakening now going "Oh my god, I can move fast with Cloud" So Cloud is bringing on a new set of disruptors in IT, you guys have already been there on the first wave of disruption, so how do balance that kind of presence, >> Yeah >> But also disruption, you might be viewed that way, I'm not sure. >> Yeah, I would say, actually, that the first wave of our free reign modernization started with this device before Cloud. Okay, in 2007 when the iPhone came out there was a significant move by big parts of the public sector to move away from blackberry, which is kind of what they use for the decade prior to that. And when we brought AirWatch, we began to see some of the earliest industries that were adopting the public sector. Many of the agencies started to look at us now, so we actually began our journey into this modernization discussion in the workplace transformation, part of the discussion before we got to Cloud. So we were prepared for some of what that looked like, for example, census 2020 that entire for all the workers something is being done with mobile devices now as opposed to paper or surveys that were done maybe 10, 20 years ago, and all powered and secured by Workspace ONE. Now, when it got to Cloud we were prepared for that because, you know, we knew a little bit of what that meant and mobile and Cloud were some of the two top discussion items that people were talking about as modernization at first under the banner of digital transformation. We had to begin to showcase to a customer that moving an application, now we're talking clients server three tier architectures as opposed to a cobalt mainframe that's really where we have but the bulk of the 886 architecture that's from virtualized VM-ware if you could take them now to the cloud and then use some of the services that these guys are building whether it's data based, whether it's artificially intelligence, machine learning, if you waste all your time in re-platforming and re-marketing an application it's that much less time you have to do some of those innovative things. And the lift and shift process once we had this sort of highway into the Cloud, so to speak, which is what VM-ware Cloud and AWS does, it became so apparent, so we are that process, we had to then work what we can talk about Fred RAM certification all of these things that I'm (inaudible) >> In AirWatch was really a critical acquisition, turns out a boom for you guys with public sector. >> Oh yeah. >> You guys had the iPhone was a driver not so much the blocking and tackling of virtualizing data centers and IT, which you had a presence in, but it was the mobility piece. >> Well since 1998, 99, since the company was founded, the public sector business of VM-ware has been very important, I mean I would say, like I said it's the top three and so, we have tremendous amount of relationships some of our biggest deals. Eight figures plus deals where done with some of the biggest and many of our partners here. >> So it's a large business. >> Large business. >> Did you break that in the numbers? >> We did but we have always said it so a top three, we have always talked about in our earnings calls, some big, large customer examples like US Army, and then , which is also a sort of representative of this community here. Safe, local education. All the universities are using us. So the footprint of VW-ware premise was well documented, well understood, lots of spent going on there. What we didn't have an access to, we had some virtual desktops, VDIs. This mobile aperture gave us a whole new banner of spending. But then the Cloud aperture is kind of taking this to a whole new level. And quite frankly if you look at the commercial sector, the overall IT spent in the world is about one trillion we track and about 150 to 200 billion of that, 15 to 20 % is being spent on the Cloud. And the public sector, governs sector is starting to track that, they are probably a little bit lagging in certain areas to commercial. But that 15 to 20 % is only going to get 30 or 40 % in the next five years. VM-ware has been one the top infrastructure companies, we are looking at our move, a bigger part of the wall of share that we gain as people move their investment to the Cloud. >> When you are thinking about the different clients and customers that you're working with, the Sled groups and then the corporate customers, what-how different are they and how, what's on the public sector's mind versus your corporate clients? And how do you manage the relationships differently? >> Yeah, we have sort of segment them at VM-ware and many companies have done the same thing into three pockets. One is who we describe as the federal public sector customers that are civilian, military and we mirror that in almost every country so Theresa here, for example, runs AWS and we have a similar type of work structure to hear in each of the key regions. The second big segment is healthcare, many of the healthcare organizations are regulated there's similar characteristics and the third is SLED, state local education. And those three pockets are very similar patterns in the way in which they buy, their CIOs are similar and they also have often very similar security requirements. So the highest maybe something like a FED and FedRAMP and we some specialized needs that they have for certain certifications on the device or certifications on the Cloud and we have to comply with all of those. But then as you get to the ones that are in the state local maybe they don't as many and higher certifications but what it's helped is to basically work with partners with a very similar across this, and the proposition on the initial transformation is really modernization of either the data center and their applications or modernization of the device. And VM-ware is very uniquely provisioned to help on both those fronts. >> And security is really top of mind >> Absolutely >> I mean we've heard on the main stage and we know how big a threat these cyber threats face. These Cyber threats pose. >> Absolutely, and if you think about aspects of security. Security has multiple aspects of where you can think of them as control points. The network, the end-point, the cloud, identity and lots of event management that is collected. These are the five biggest markets of security. In each of those areas VM-ware is starting to play more. For example, network, you know, five, six years ago people didn't think of VM-ware in that area but with NSX our leading software define networking area, we have become the lead on that segment and about half of our use cases are security related for a use case called micro-segmentation. So the government can basically segment out a set of their apps and through software, think of these as on-off switches almost like light switches only allow certain apps to access certain parts of the data center. That's very easily done through NSX. Workspace ONE, the endpoint can now be extremely secure and provide all the levels of security that Blackware provided in their proprietary devices but now on any device. So we've been systematically looking at each of these areas I would estimate about 15 to 20 % of VM-ware revenue is security related use cases and public sector this is a very, very key place where we get grilled on and we have to satisfy their level of requirements for security. >> Sanjay, what are you doing here? I know you said you are speaking at a panel, Fireside chat, what's your agenda of the week? What's the story? What some of the key talking points for VM-ware? >> VM-ware is one of the top sponsors here, I don't know whatever is global or platinum or whatever the highest level is, you will see our name's there. And largely what we did when we announced this partnership was, you know, Andy and I were classmates at school. We wanted to build a very close partnership at their big events, so you will see us at all the major summits. VM-ware is a top sponsor, and you'll see them also at >> Doubling down on the relationships. >> Yep, we're doubling down. And they're doing the same at VM-world, so we said "Listen" and I think I talked about this in one of your previous shows. If you can mingle, VM-ware has collectively about 100,000 people that come to all the VM-ware events across the world and maybe about half a million to people who watch those events online. Amazon has probably twice that number. But if we can mingle each other audiences because they are coming off into both shows and we, the best showing up at AWS summits and we'll give them lots of access to VM-world. >> Ups* >> (laughs) There we go. >> Operations >> Hey, that's got a ring to it. I like it >> That's exactly the vision. So we, first of all, VM-ware is a big presence and the acquisition we've done, also, like Cloud helped also has a big presence, so that's one. Number two, we try as often as possible to have either a key note or some kind of Provence, I've had a good friendship with Theresa. She invited me to speak, I think there's an event with their top five hundred customers, sort of a key note inside that. And I do that a little later this afternoon. And it's also a tremendous opportunity, I think they have 13 or 15,000 attendees here to meet some of our top customers, so those are the three things that I'm doing over the course of the next day and a half. >> You got the CIA deal 2013, what that has done, in gestation period since then, a lot of other folks in the DC circuit here, public sector, government, agencies, they are all going "Hmm, Amazon has got the right formula" so Theresa put the formula together, people are adopting it, you guys do the strategic deal with AWS with your AA gown on, as a student of the game if you will in tech, Sanjay, which you are, knowing what you know now at VM-ware what's your perspective on this? Because you got a big tail wind with Cloud, you get clarity in what you guys do, in what AWS does, you also have multi Cloud with other Clouds, I mean you got NSX with a nice product, you got multi Cloud built-in hybrid, I mean, pretty good at spot for VM-ware for public sector. What's your perspective on this? >> Yeah, two parts to your question. First off, tremendous respect for Andy. I was describing before I go out on the show with both of you, when we were in school, I wouldn't have put him, in 1987 when we graduated, as the person who would of been the pied piper of this public Cloud revolution. But kudos to him, Theresa a fantastic executive and I think that, you know, 2013 CIA deal put them on an incredible place to be, a front runner in this and many other deals they've done similarly. VM-ware, we saw over the last, you know, 3, 4, 5 years is a significant rise of Amazon in our accounts. Customers were asking us "Why can't we get the best of both worlds? Why does it have to be on premise runs and VM-ware and public lines and I've got to portent and refactor and re platform my applications?" So our customers drove a us together and what we've sort to do in our relationship with Amazon is we meet on a quarterly basis, we review feature and function, product road map, we're aggressive, with our sales teams are trying to pursue opportunities together. And that's really helped us, you know, that's part of the reason I'm here, so, the more that we can do together to satisfy customers, customers like seeing big partners come together, even if, it feels a little bit like Berlin wall moment, right? You remember 1987? You had the US and Soviet Union and people were surprised by that. I that that the general consensus was complete surprise in 2016 when we announced the project with Amazon. But with every move we made like for instance, recently we announced the FedRAM status, one of our biggest 8 figure deals we had announced in our queue for was with a major customer that's in this segment, actually. Our public sector SLED and the more that we can do this, I think there's a lot of future ahead of us. >> Berlin is interesting, you know, tearing down that wall that was a moment that came down and the government, the theme that we are hearing over and over again is red tape. Lag with data it hurts application work loads so fast data, make it available, cut the read tape out of procurement, I mean, basically, 1980s, 1990s, procurement rules don't apply to how people consume and deploy technology today. >> Yeah, absolutely. >> Tear down that red tape. >> I think you got that right. I think the governments mandate to go Cloud first in the, you know, last several administrations was absolutely key and certain elementary work loads like websites, I mean why, so if it's a public website that's holding public information, I mean, of course, you've got to worry about security but the data public anyway. Okay, so, what's going to get hacked? I mean, why don't you move all websites that are web content, so some of those early work loads are moved over very easy. I would call it so, the 1-O-1 of posting. Why would you want to have server just to host a website? But once that's done the more mission critical applications, Windows work loads, Oracle's sequel service databases, Virtual desktops, now you are starting to see and I think eventually some of the more mission critical apps like SAP or Oracle apps, I think you see them also now with a lot of customers in both public sectors and commercial- >> Military DOD tactical edges, >> Absolutely. >> The military lives are on the line, it's not a video game, lag actually will kill people. So you want to have that application peaked. >> Exactly. >> With the right architect >> One of the things that are so inspiring about being here at the public sector summit is that we are seeing all these used cases, of using the Cloud for good to solve pressing environmental challenges, health challenges, social challenges, what are you seeing, what is VM-ware working on that is, that is particularly inspiring to you? >> I am glad you asked that Rebecca. I would say that's one the things and Amazon shares a similar value where we think that, you know, technology companies have to think beyond themselves and be a force for good. I think that one of the first times at any major conference, last year we had the Nobel Peace Prize winner who's changed the world, Malala, come and speak and I think everyone who comes to major tech conferences, and we had one of the biggest conferences, was, I mean, we had grown big men, 6 foot tall crying at the end of that. And we had a number of customers that we loved to be able to talk about there stories, Make A wish is an example of an organization that, you know, if someone's with a terminal disease and they want to have some wish that they could wish for, all the infrastructure runs in VM-ware and we can help them serve that audience better, we have a number of charitable organization, Red Cross was on (unintelligible), so we, a big part of pad mind the attire of companies, kind of charter in our EPICC values has been people of integrity, people of work with the customers and the community. Our values EPICC stands for execution, passion, integrity customer and community. And that last C I think is very important, cause, you know, we live in a world and the more important thing is not necessarily how much money you make but what a force you can be for changing people's life. That lasts forever. You can't take your money into the grave but the more you can have on people, impact on people's lives, I mean, John, I am delighted to see your daughter. >> Yeah. >> I mean that generation continues >> Well, it's community right? >> And you're passing on those values onto the next generation or helping people that's the bigger story of life and that gets us equally excited as innovation. >> Communities can now be instrumented via digital technologies, so your faster time to find truth, people who have communities were very active, the data is there, it's all in the data and so you can see the impact >> You know, I think that's absolutely key. So John, I would agree with you and I think you as, you know, you talk to companies that's an important question to ask them. Because we are all in this together. There is no whether it's competitors or what's not, we can all serve the greater community, here for good and make this world a better place, you know there is a lot of what we do that helps the world run better, that's good, infrastructure helps us run better, but helping the world be a better place, it takes both individual and collective will. >> Well one of the talent gaps is not just computer programming and tech people it's architects for the new society that needs help and these key policy questions like governance and responsibilities, you're seeing YouTube and Facebook and our neck of the woods responsible for all this impact and they don't really kind of, there's no oversight. (laughs) >> Well, listen I'm not going to get into the public debate about, you know, privacy and governance and so on. I would say that one thing that, you know, we're also really excited to kind of give back to the community in terms of education. One of the things that is very powerful to VM-ware is our user groups. We call them V-mugs, VM-ware user groups and there's collectively about 150, 200000 of them and it's amazing when you spend time with them, they are really, really, they are members of the community really because they're customers and partners and they dedicate their time to educating others and the more that we can use online forums, I love the way in which you're using your online platform with the AI and other techniques. I think artificial intelligence becomes the ground equalizer, give access to everybody. >> Access to the voice is access to the data but right now as you pointed out we need a society that's going to have shared values and I think that's like where the good is coming from and it's easy to get on the bad tech band wagon which everyone is on right now but there are examples of tech for good, you mentioned- >> But when you say shared values, is that you, I mean is that possible? >> Well, I think there is, there is an awakening going on now from Silicon Valley where I live and here in DC which it's, it's in my face here because people as tech savvy here as they are in say Silicon Valley, no offense, but those people aren't as tech savvy here as they are in Silicon Valley, they don't go deep on the impact of tech but they see the results of bad tech. So I don't see a lot of a vandalizing going on outside of certain areas around tech for good. So I think there's a lot of great examples, human trafficking, you're seeing tech for hiring, new generations onboard training, skills gap, so efficiencies in healthcare, there is so many areas that tech could be used for good and if people were educated on focusing on that and not the bad, I mean bad's got to eradicated, certainly, I'm not for bad things but maybe there's a lot more good, the good pile is much bigger than the bad pile in tech, so, when I say shared values is recognition of that which is let's get on the same page, there's bad and there's good, have that debate and then apply the tech. >> Yeah, interesting. It's a galvanizing force. >> Well, it's just like any invention whether it's the printing press or the use of fire, I mean, there is good use of it and there's bad use of it. And we got to to find ways by which technology while this debate is going on as to as some of these social media platforms, my fundamental belief is that technology is going to transform society, the reason I came to the United States as an immigrant was to study computer science and I felt like the United States had, you know, when I came to this college I hade never heard of called Dartmouth College in Haven New Hampshire, was very fortunate to have a scholarship to go there but that's because I wanted to study computer science and I felt like computer science could change a lot of the way at which, you know, at that time, I was just trying to program and learn how to, you know, create algorithms but if you look at what transformed every aspect whether it's the mobile device which is really a computer in your pocket or Cloud computing which is kind of bringing the super computer into the Cloud. >> (inaudible) >> I think it's tremendous what we can do and we have to constantly find ways by which artificial intelligence and these forces of, you know, the next part of general mobile, Cloud computing can be used for greater good. >> Did you go to scholarship on full bode with basketball? (all laugh) >> Man, we got the Warriors with two ball games. >> So you are a big Warriors and for the folks that don't know Sanjay, we always used to talk about every time Warriors looking good to stay alive but not looking good >> So sad to see. I mean it's sort of, the last game I was watching last night, it was, it was sad, it was, of course, it was a win but also a loss to see KD go down that way was just absolutely tearful, yeah, but, you know, we have one more game. >> It's going to be hard >> It's going to be hard to, you know, kind of beat the crowd and the crowd is really loud at Oracle and get one more game and then, yeah, I think it'll get to game 7, we'll what happens but it's just great to their heart. >> I'm from Boston so I'm kind of over Golden state but I am sure everyone is over Boston and our red socks and our throw-ins and our pads >> Duck tour has only been 15 months? >> I know exactly! Exactly! We're still- >> There will be a Celtic warriors game >> That would have been so good >> That would have been so good like the Lakers (inaudible) >> It was more recent than that. It was the pads victory, so yeah >> Okay >> Yeah, anyway. Just saying, just saying. Sanjay, thank you so much for coming back on The cube, we look forward to your 14th visit on the show. >> Thank you, Rebecca. Thank you, John. >> I'm Rebecca Knight for John Ferrier, stay tuned for more AWS public sector summit here in Washington DC. (Upbeat Music)

>> Live from Las Vegas, it's theCUBE, covering Dell Technologies World 2019. Brought to you by Dell Technologies and it's ecosystem partners. >> Welcome to Vegas! Lisa Martin with John Furrier. You're watching us on theCUBE live. The end of Day One of our three days of coverage of Dell Technologies World. Can you hear the music? The party's already getting started. We have more content to bring you. Please welcome a couple of guests from DXE Technology, Kevin Johnston, Chief Sales and Revenue Officer, Cloud and Platform Service. Kevin, it's great to have you. >> Thank you very much. Glad to be here. >> Our pleasure. We've got Graham Stringer, Managing Director of Workplace and Mobility for DXE Americas. >> Thank you. Good to be here as well. >> Yeah, you waited just in time for the concert, guys! >> We did. >> Just in time. Here we go. >> All right, so, Kevin, let's go ahead and start with you. Give our audience and understanding of DXE. What you guys do, who you are, all that good stuff. >> Yeah, okay. That's great. So DXE was formed two years ago as a result of the merger of legacy HP Enterprise Services Business and CSC. DXE was formed really for the purpose of helping our large enterprise clients accelerate their digital transformation. So we're about a $22 billion IT services company, really aligned with our partners helping our clients transform digitally. >> And you guys were on the cloud early, too. There's a lot of devops going on. >> Yep. >> You guys had your hands in all the clouds. >> We have. >> What's your take on, here at Dell Technologies World, Microsoft's partnering with VMware? >> Yeah, so we would share a lot of beliefs with Dell Technology and VMware in particular, in that multi-cloud is a real thing. And we see multi-cloud, especially for the large enterprise clients, really being an answer for quite some number of years to come. We also believe that a large percentage of application portfolios will migrate to cloud. Whether it's private clouds or public clouds, and that there's a lot of work to be done to transform those applications to really take advantage of cloud native features. >> So last year's theme of Dell Technologies World was Make It Real, 'It' being digital transformation, security transformation, IT transformation, and workforce workplace automation. Graham, I'd love to get your perspectives on workplace mobility and some of the things that were announced this morning with Unified Workspace, Workspace ONE, and recognizing, hey, for our customers to transform digitally successfully, we've got to make sure that their are people are successful, and their people are highly distributed. What are some of the things that you heard this morning that are exciting, aligning with some of the trends that you're seeing in the workplace? >> Well the big trend that we're seeing is the role that HR is now playing in digital transformation of the workplace. If you go back two, three, four years, it was very IT centric. Conversations were predominantly with the CIO. We're now seeing 30, 40% of organizations or more engaging at the HR level. We did a recent project with one of the big retailers in the industry and right out of the bat, this chief HR officer was engaged right from the get-go. They want to know that their employees are going to experience work very differently. So that's one of the big trends we're seeing emerging. >> When did this shift happen? When was this going on? Past year, two years? Because this is a shift. >> I would say the shift has definitely happened the last couple of years. Millennials are having a huge impact. You're getting quite the cross-pollination of a lot of different generations. Millennials are now having an enormous impact. If you look at outlets like Glassdoor, millennials want to know when they go to an organization can I bring my own device? Am I going to have a great workplace experience? And you can't stick with a very traditional, legacy way of delivering IT where everything was shift left and you got to a point where everybody hated each other. >> That's a problem for productivity. >> Yes, a very big problem for productivity, absolutely. >> Talk about some of the challenges that customers have overcome with digital transformation, as it starts to become less of a buzz word and actually more of a reality and strategic imperative that has some visibility at the unit economics and value. >> Yeah, I think every large enterprise client we talk to has a digital transformation agenda of some sort and at some varying place along the path to trying to adopt a new business model or adapt to a different business process, so the challenges that we see with these clients in general is how do we scale? So I have legacy IT that won't disappear overnight and I have all the possibilities of digitally enabling or bringing new digital technologies that enable these processes or models. So this is a challenge: how to enable digital at scale where traditional and digital have to live together for some period of time. >> And it's not just a tech challenge, it's culture, too. How far has tech come because you've mentioned containers with legacy? That has been a great message to IT is I can put a container around it and hold onto it for a little while longer, I don't have to kill it, and make the changes to cloud-native. >> For the tech guys, there's been a lot of fun things and containers probably is the bridge for legacy apps into cloud for sure. For the rest of the folks, for the normal people, the way work gets done and the way to rethink how to do work in the mix of IT or technology into business is just different. >> Graham's point is beautiful because the expectation of the employee or the worker whether they're in the firm or outside the firm, outside in or inside out, however they look at it, is the new experience they want. So the expectations are changing. What's the biggest thing, we saw some stats on stage about remote working, three places, two places, I mean, hell, I'm always on the road. What is some of the expectations that you're seeing? Obviously millennials and some of the older folks. >> They want to see IT delivered in the way they want to receive it. That's one of the biggest trends we're seeing. So for Millennials, my son's kind of in that age category, right, they love to text. To pick up a phone for a younger generation is a little bit foreign. You go and deal with baby boomers, they want to be dealt with in a much different manner. So you've got that whole change, and then you've got the whole notion now of work is changing; where do I work, the ability to basically work 24/7, wherever I want, however I want, using whatever device that I want. And that of course is now creating a whole new set of challenges for IT, particularly around security. >> But employee experience is absolutely fundamental to a business' success; their ability to delight costumers, their ability to deliver outcome, so it's really pretty core. Talk to us about those conversations that you're having with customers. Are they understanding how significant that employee experience is to bottom line business outcomes differentiation? >> Very much so. We're working right now with a large manufacturing firm and they're doing not just an inside out, but outside in, so they're actually coming to watch. It's part of a workplace strategy to look at it from the outside as well. In other words, how can our client take innovation to their suppliers, their customers, to demonstrate that they understand it? So that's extremely exciting when we see that they're not just focused on their own employees and the experience germane to them. >> One thing I might add is that maybe less so from a user experience per say, but the individuals as an employee. So the shift to digital and the skill shift that's required to go with that is really probably the most monumental change that all of us technology companies and the business part of our large enterprise clients is dealing with. Whether it's a skills gap or whether it's a culture gap, this idea of just simply waterfall to agile and the way to think about that or silo versus end-to-end as just simple ways to think differently about how to go faster. So the experience, how you recruit, whose going to make it, who can be trained, and then where you need to be able to source the new talent from as well. >> I totally agree with you. We do hundreds of shows a year, this is our tenth year doing theCUBE, that is the number one things that we hear over and over again from practitioners and customers and from people working. It's not the check, you can always get a check solution, it's the cultural and the skills gap. Both are huge problems. >> And this is part of the digital at scale point. So we'll hire something in the neighborhood of six to eight thousand digital skills people. We're just about to close on active position of Luxoft, an agile devops digital company. We'll bring another 13,000 in. But if you think about the normal large enterprise and what you need to do to be able to have the university networks and to be able to really source that scale in order to effect the transformations that business need to make to stay competitive. >> And the other point, the engagements have changed too. I'm sure you guys have seen your end but every IT or CIO we talk to says, "I outsourced everything decades ago and now I've got a couple guys running the show. Now I need to have a hundred x more people coding and building core competency." That's still going to need to engage people in the channel or our service providers but they need to build core talent in house. It's swinging back and they don't know what to do. (laughter) Is that why they call you guys? Is that how you guys get involved? >> We'll help train. We'll help clients think through what does an IT or business organization need to look like profile wise, skill wise, operating model wise, and in many cases it's I have my digital model but I still have my traditional model that needs to coexist with it and then here's where the opportunities are for people to develop career paths and progress. >> Kevin, talk about the sweet spot of your engagements that you're doing right now. Where's the heart of your business? Is it someone whose really hurting, needs an aspirin, they've got a headache, is it a problem? Is it an opportunity? Is it a growth issue? Where do you see the spectrum of your engagements? >> We kind of find clients in one of three spots normally. "Hey, I know I need to do something but I'm not sure what it is, can you help me figure out to get started?" So more design thinking, problem solving. We have other clients at the other end of the spectrum who are, "Hey, I've got this figured out. I need a partner to help me execute it's scale. And I know the model that I want to do, I know the business reason for doing it." And then we have a lot of folks that are in the middle, which is, "I've started, I've got a few hundred AWS accounts. I got private clouds sitting idle. Someone help me." Or, "I've got security issues, compliance issues." >> So they're in the middle of the journey and they just need a little reboot or a kickstart. >> They need help scaling. >> They ran out of gas. (laughter) >> And how are you working with Dell Technologies and their companies, Dell EMC, if they were to do that? >> The partnership with Dell Technologies, VMware, are really center to how we go to market. DXE is one of the top few partners largest in the ecosystem. The breadth of our portfolios are extremely complementary, whether it's things like device as a service or multi- and hybrid cloud, or pivotal and devops. So the breadth of the portfolios max up really well which makes it the impact potential for our clients even more important. Dell Technology broadly is really one of the few partners that we're shoulder-to-shoulder going with to the market as well. >> Awesome. Great stuff. What's the biggest learnings you guys can share with the audience that you gathered over your multiple engagements holistically across your client base? That's learnings, that could be a best practice, or just either some scar tissue or revelations or epiphanies. Share some experience here. >> I think one of the big learnings we're seeing is the shift now to very much business outcome driven decision making. If you go back to your point about the big ITO outsourcing days, that was all about just strictly driving cost out, and that's why you got to that point where everybody was left hating each other. Now it's about business outcomes. You've got the impact of Millennials, you've got organizations wanting to create a new and better experience for the employees and they're coming to us to say, "How do we accomplish that?" We've got an organization we're working with right now, they're trying to elevate themselves to be one of the top 50 best places to work for in the US. How do they arrive at that? For them, that's their barometer and so it's not about driving costs out, it's really achieving that overall experience and enhance a business outcome. >> So they're betting on productivity gains from morale and happy workers. >> Right. And also they're recognizing the downstream impact on their customers, productivity, the level of employee engagement, right? I mean those are the things that the organization knows that if they hit on those, I mean the sky's the limit. >> Right. Anything on your end? Learnings? >> Yeah, I would say the "don't understand the talent" challenge. The ability to pivot from here's the way we all know and are familiar with doing things to the new way. There will be a big talent challenge. The other thing is the operating model from an IT standpoint. Traditional IT operating model operates at a particular speed, cloud operates at a different speed. And the tools, the talents, the skills that go with that are just completely different. And then I think the last thing is just it seems maybe surprising, but compliance at scale and at speed. So security and regulatory compliance, we see that falling over all the time. >> Great practice you guys. I've been following you guys for many years, you've got a great organization, lots of smart people there we've interviewed many times. My final question is a tech question: what technologies do you guys like that you think is ready for prime time or almost ready for prime time worth having customer keep focusing on and which one's a little more over hyped and out of reach at the moment? >> I'll take a stab at that. If you look at today's Wall Street Journal, Deloitte talks to I believe the figure they quoted was roughly 25% of organizations are doing AI in some form already, PoC or at least are committing to it in terms of strategy. We're seeing that inside DXE as well. AI is now being incorporated into our workplace offerings. The potential for that is enormous, it's real. The technology in the last couple of years, particularly with cloud computing, has really enabled it. When you look at platforms like Watson, these are capabilities that just weren't there 10, 12, 15 years ago, and now the impact that it can have on the workplace, help lines, chats, chatbots, and so forth, is enormous and it's real. Five, 10 years ago it definitely was not in it's maturity. >> Okay, over hyped. >> What's over hyped? I don't know, what comes to mind for you? >> Or maybe I'll rephrase it differently: not yet ready for prime time, but looks good on the fairway but not yet known. . . >> I think for me through workplace, IoT has still got a ways to go. AI and analytics is definitely there. IoT I would say is a little bit behind. I'm sure that Kevin has cloud and platform thoughts. >> Yeah, I would say from an over hyped standpoint, we've seen a lot of companies, large enterprises, legacy application portfolios think they're going to refactor all their applications and cloud native everything. So it feels that people are now kind of getting past that point, but we still see that idea a lot. I think the opportunity that is really in front of us, and you kind of called out, containers. Legacy applications into cloud feel like a remaining frontier for the large enterprise. We think containers and the idea of autonomous, continue optimization, financial performance, is a way to make apps run in cloud financially and performance wise in a way that we don't see a lot of companies fully solving for that yet. >> Awesome. >> A lot of work to do, a lot of opportunity. Kevin, Graham, thank you so much for sharing some of your time and thoughts and insights with John and me on theCUBE this afternoon. >> Very good. >> Thank you. >> We appreciate it. For John Furrier, I'm Lisa Martin, and you've been watching theCUBE live from Vegas. Day One of our coverage of Dell Technologies World is now in the books. Thanks for watching. (upbeat techno music)

>> Live from Las Vegas, it's theCUBE. Covering Dell Technologies World 2019. Brought to you by Dell Technologies and its ecosystem partners. >> Hello everyone, welcome back to theCUBE's live coverage here in Las Vegas for Dell Technologies World 2019. I'm John Furrier, your host of theCUBE, with Dave Vellante, co-hostman Dave. Great keynote, day one of three days. Great event. We got two more days of coverage. Our next guest is Jeff Clarke, vice chairman of Dell Technologies, Master of Ceremonies on the stage with Michael Dell. Great to see you again, CUBE alumni, welcome back. >> Thanks for having me. >> So, you're pretty busy. I know you're super scheduled up, so thanks for spending the time to come on. >> My pleasure, looking forward to it. >> So, break down what's going on here, because a slew of announcements, some game-changing announcements. Some new partnerships with Microsoft, in the end-user area, pretty positive, once competing with VMware, now tied in. Dell Technologies under the coverage with a full portfolio of services, massive macroeconomic tailwind around people refreshing their infrastructure for the Cloud. You guys are in good position. >> Oh, I think we are. Thanks for having us. To me, the biggest takeaway from this morning's keynote is the level of integration and alignment across Dell Technologies and all of its assets. We built upon that and gave two very specific examples. Pat and I talked about, on the PC side, trying to address the needs of this new digital native workforce that's coming in to bear with no boundaries of how they want to work, where they want to work, and how to modernize the PC experience. And we introduced Dell Technologies Unified Workspace. And then the second announcement, which we're really excited about, is the alignment of our company around the Dell Technologies Cloud. And the fact that we announced a component of a platform, where VCF is integrated onto our VxRail products, and you can deploy that on-prem as a solution today. And then we talked about building on VMware's announcement late last year around Project Dimension, bringing Project Dimension into a reality, a data center as a service of the VMware Cloud on Dell EMC, Data Center as a service, backed by Dell Technologies. And then we expanded upon that with Azure Services on VMware. So, pretty busy morning for us. >> Yeah, Project Dimension, I want to ask you real quick about. I always said that that's a fantasy kind of project, because it was so radical, and early on, when you think about it, but it makes so much sense when you think, as a service, with software service, why wouldn't you want to have theCUBE as a service? Data Center? And everything is becoming a service, and that's now clear. But it's hard to do. That is an interesting product. I think that's certainly an edge product. You guys see that, clearly. But what's going to be the impact to customers? Because this is now kind of easier to manage when you think about deploying a data center. >> There's a couple things that I think are underway. One is, workloads are migrating back to on-prem. And those workloads come out of a public cloud, so the cloud operating model is something customers are familiar with. Now with our Data Center as a service product, we have a cloud-operating model that drives consistency and, ultimately, provides an operational hub from the edge to the private cloud reaching out to the public cloud. Then you can get that as a specific product, build out your own, or this managed service, as you just referred to, and we think that's a pretty compelling proposition to help customers, particularly in smaller deployments, whether it's on the edge, remote location, remote office. And it's a service fully backed by us, single price. And we think it has a huge advantage in the marketplace to help customers deal with fewer vendors or manufacturers to get a single solution from one, from the hardware to the software to the service and the support. >> So you talk about alignment across Dell Technologies. You were clear in the analysts' discussion today as to what your primary go-to-market is with regard to VMware on Dell. That was clear. And appreciate the concise, clarity answer. You also talked about barriers to integrating that you've removed. In some respects, you do a lot of things, and one of them is you're a fixer. What were some of those barriers, and what does that hold for the future in terms of momentum? >> I think the first barrier that I encountered when I began leading the ISG team, we fundamentally weren't aligned with VMware. We had a strategy, they had a strategy, and while we worked both for Dell Technologies, we saw the world differently. And Pat and I recognized that early on, and our working together, and we've began to wrestle with that. Quite honestly, Michael and I expected us to get that result, and we subsequently did. So now we have an alignment. We have the same strategy that we're deploying with the same common vision: how to make IT easier and simpler in this data era that we're in today. And then we built a technical framework of where we're going to collaborate. And quite honestly, we had to teach our teams how to collaborate, and what collaborate meant. It wasn't you met once a month and each went off in their corner, then came back and said, look what I did, look what I did, and maybe we had two different answers. We forced an operating cadence and mechanism where Pat and I get with the team on regularly scheduled meetings, essentially every other week, and drive technical collaboration across five key domains that we care about. That we think are most valuable to our customers. And we're leading by example and breaking down every barrier from go-to-market, to operational, to technical, who tests what, how do you define what the requirements are, what customers are retargeting, and align the teams along those vectors. >> One follow-up, if I may. I think we got tight on time, but I want to ask you about the client business. I want to get you on record on this. Very important part of your business, it's almost half of the business revenue. It's a lower margin business, but it's critical that you hold serve in the client business, because it absorbs a lot of corporate overhead. I wonder if you could talk about the importance of the client business to Dell Technologies and it enabling your ability to do all these other things that you want to do. >> Well, you talked about the financial components of why the PC business or client business is important to us. But let's not forget, customers want an end-to-end solution and one end of that solution is what's on the edge of the network, and the PC is still the primary productivity machine in business. I don't see that changing. So the ability to start from there, and then migrate across our stack to the core to the cloud, as you've heard us talk about that, is a difference-maker, a differentiator from us over every one of our competitors today, who may have this component, this component, or this component, we're in a unique position to bring that together. Then we can bring differentiated value by linking the seven assets of Dell Technologies together in a highly integrated way. We talked this morning about SecureWorks, Workspace ONE from VMware, RPCs, and then our total service offering around ProSupport and ProDeploy that stitches that together in a very differentiated way. That's what customers want, and we're able to do that. And that has components of the entire enterprise, per se. >> Jeff, I want to get your thoughts on the customer situation. Obviously, one of the keynote customers was Bank of America. I like how the CTO, how she said this. "It's not how we got here, it's how we go forward." This is really the digital transformation reality. The rules have changed a bit. Certainly, there's some tech that's coming to the table, that's going to be good for customers. But as you look at the trends, and it's pretty clear what we're seeing, you've got developers, and you've got operators. If you compartmentalize the different roles within the corporation, that seems to be the big ones within IT and operations. And then the workloads are the result of the developers that have to run on the operations. So, it seems that you guys have a clear view that you want to make that infrastructure be operationally consistent. That was one of the messages. >> Spot on. >> How are customers talking to you about this? Because, one anecdotal thing is Google, for instance, has their own cloud for their own search and everything else. They have SREs, Site Reliability Engineers, which kind of validates this notion that operations is highly critical with developers for those now multitude of workloads. Because Edge is going to spawn a huge amount of applications, we think. More workloads, small and big. So, existing workloads, new workloads are coming. How do you guys see the operation piece? 'Cause I think this is a real key point. >> Well, I think in simple terms, customers are asking us to help them drive out complexity in their operations, help simplify it so they can actually invest more in the types of technologies, the application, the development of things that differentiate their business. So, if you believe that to be the basis, which we do, then driving out complexity, having a consistent level of automation, a consistent operational model, a hub to be able to move workloads across any of those environments, we think is a real advantage, and it will lower their cost. They will have consistent infrastructure, a consistent software management stack, management or orchestration and automation, we think that's exactly what they're asking for. And the reality is, we just announced the ability to do it. >> And if you have the developers, you get revenue on top of it, so cost savings and revenue. Out of the customer conversations, could you stack rank the pattern of issues that come up that they're concerned about, that they're solving? Opportunities that are challenges today, opportunities tomorrow, what are some of the areas that are popping up to the top of these conversations? >> Cloud strategy. Security. How to do DevOps. Edge. And how to deal with all of this data. >> We've got a question from the crowd. Ask Jeff about sustainable innovation in Dell's work in transforming electronic waste into jewelry. I didn't know about that. And ocean plastic in the laptop packaging. That I did know about. I think the question came from somebody who works from you maybe. >> Maybe so. >> That's a good question. I didn't know, you're making jewelry? >> We've been on the forefront of what we call the circular economy, where you reuse materials that you introduced in the marketplace in new forms. Whether that's wheat straw, the byproduct of harvesting wheat and turning that into packaging. We announced at CES 15 months ago, recycling printed circuit boards, extracting the gold, and creating and providing that gold, in this case to a jeweler who made jewelry out of recycled printed circuit boards. Our commitment to use recycled plastics and to take all these plastic bottles and do something with the material, we have a high percentage of our products today that are built on recycled plastics. We have many examples, wonderful choices of PCs in front of you, has carbon fiber in it. The carbon fiber in the product is actually a waste out of the automotive industry that we reused to build out this product. So, we have a long tradition, and something that's very important to us, of building sustainable products, recycling materials, to be able to do that across our entire portfolio. >> Jeff, thanks for coming on theCUBE. I know you're tight on schedule. We appreciate the time. Final question, I'll give you the final word. What's the most important story here at Dell Technologies World this week in your opinion? >> Dell Technologies has a breadth of unique hardware, software, and services capability unlike anybody else across our seven strategically-aligned businesses that will help, ultimately, make customers' lives easier, simpler, and reduce complexity in their environments. >> And the numbers are showing its financial performance is looking good. Congratulations. >> Thanks, thanks for having me. >> Jeff Clarke, vice chairman of Dell Technologies, here inside theCUBE breaking it down, sharing his insight and commentary on the announcements and the event here at Dell Technologies. Stay with us for more live coverage. Day one of three days of two CUBE sets here on the ground floor of Dell Tech World. We'll be right back. (upbeat techno music)

>> Live from Las Vegas, it's theCUBE covering VMworld 2018. Brought to you by VMware and it's ecosystem partners. >> Hey, welcome back everyone, we are live here in the broadcast booth presented by theCUBE. I'm John Furrier co-host with Dave Vellante. VMworld 2018, day three of three days of wall-to-wall coverage. Our 9th year covering VMworld and the VMware ecosystem. It's great to have on theCUBE Tom Corn, who's the Senior Vice President, General Manager of the Security Products from VMware. Welcome to theCUBE, good to see you. >> Thank you! >> We were just bantering before we came on that you are part of building AppDefense, one-year-old product. >> Yes, yeah. >> You're in the nerd nation, if you will. >> (chuckles) Yes. (laughter) >> We say that with all due respect, Tom. >> I take it. >> I had to stay for Stanford since the football opening day is Friday, so we'll be tailgating at Stanford, but Palo Alto VMware, tons of technology in VMware, we covered the radio event, which was first opened to the press this year, we were there. Security's number one. Pat Gelsinger has said on theCUBE so many times, even four years ago, he said security's a do-over. But it's more than a do-over, it's central to how the Cloud and on-premises are working. >> Yes. >> Hybrid Cloud validated by Andy Jassy this week. >> Yes. >> With RDS on VMware on premises, pretty major industry milestone there. You're in the middle of the security leading the team. What's the update for VMware, still pumping on all cylinders? >> Uh, I think this is actually, we're making some of the biggest strides forward in security right now. I think there is such a huge opportunity to not make the mistakes we made in the past, and start with a clean slate, do security the way it really, ultimately, makes sense. At the end of the day, we're really not trying to protect servers or networks, we're trying to protect data and applications. And being able to see things through, look at the infrastructure through the lens of the application, the lens of the data, and align security to that, is a huge opportunity to fundamentally make Cloud more secure than a traditional, sort of physical environment. >> So, we, I got a stat from TrendMicro, just came by theCUBE today on the briefing, they said one in six dollars are being spent outside the organization and buying other SAAS platforms. Cloud certainly, with Shadow IT has caused that. Whether it's DropBox, ADS-Bih instances, just stuff flying up there opening up, potential vulnerabilities. Virtual networking is clearly a part of the architecture with virtual machines. So security is really under a lot of pressure, and Micro Segmentation seems to be a hot topic. This is driving a lot of new value as the architecture shifts to Hybrid Cloud, which is such a Cloud Operations. >> Yeah. >> Infosec teams, Net Ops, are all working together now, but it seems more confusing than ever. Can you clarify how companies are organizing around the Cloud, Hybrid Cloud operating model in Multi-Cloud with security? >> Yeah, so, first it's important to understand the central idea behind micro-segmentation is to provide a mechanism to compartmentalize all the elements that compose an application, a regulatory scope, so that if one thing falls, everything doesn't fall, right? The reality is a perimeter of a data center is so porous in so many dimensions that you cannot, your security strategy can't be predicated on anything inside my data center is just fundamentally secure. I think we live in a state of compromise. Deal with it, right? And so, the notion of compartmentalizing an application allows for a limited lateral movement of attacks. It also provides a policy boundary to say, you know, I can place controls on the boundaries of an application and that boundary may not exist in the physical world, but it does in the virtual world. You know, the best analogy I came up with for this is imagine you had an entire company in a skyscraper, now all the employees were in that skyscraper. You could put guards in the front door of that building, and the instructions for them on who gets in and who gets out, or what looks weird in the lobby, pretty straightforward, okay? Now take the employees and spread them out into parts of floors of different buildings all over the city, fill the building that you had with employees from lots of different companies, now there's a bank, a TGI Friday's, a bowling alley, and the FBI. Now tell those guards what looks weird in the lobby. Like, now tell those guards who should get in. Now, suddenly, it gets really confusing, and the ability to say I want to create a virtual skyscraper that will put all the employees in one place, that's the idea behind micro-segmentation. >> Tom, you talked about the Cloud, the potential for the Cloud to be more secure than the traditional environment. In June, John and I were at the public sector summit, and we heard the CEO of the CIA say Cloud, on our worst day, from a security standpoint, is better than my client server. 'Cos the first time I'd heard client server in about ten years, but nonetheless, >> (laughs) That's the government. >> So, (laughs) my question for you is, in terms of, so his implication was, it's already there. What has to be done to bring that level of security to that hybrid world? >> Yeah. First, I would be careful with that statement. I think we are probably right for the average company, the way a Cloud provider would secure the infrastructure on down, is actually very solid. The application's your problem. The data that's running on it is your problem. And that's not quite the same thing, there's a different set of things about what can get access, how that's isolated for other things. So-- >> Let me make sure I understand that. So you're saying, the infrastructure check, but that's not the story. >> And what's above the operating system, my applications, and how data's flowing on that, and there's no good excuse that oh, it was running on such and such infrastructures or service, it's not my problem. It's still the company's problem, right? >> Right. >> So a lot of the basic things of access control, alignment of controls, policy, those are still, ultimately, in the hands of the customer. Now, I do agree that the opportunity is to make the simpler, less misalignment, less misconfigurations, those are tremendous opportunities of the Cloud. >> But there's some conventional wisdom in the industry that says, you know what, it's a fait accompli you're going to get hacked, so it's all about how you respond. I'm inferring from you that no, that's not the case, that you could actually protect the data if you take an application view. >> Yeah. >> Of course, response is important. >> Yeah, but I feel like there's no perfect solution. I guess maybe the best way to think of security is as a risk management exercise. You're going to spend whatever you're going to spend. The question is, are you spreading that like peanut butter on a bunch of stuff, or are you investing your time, money, and capital in the things that would have the most material reduction in risk? There's a wonderful framework that Gartner came up with that I liked that, and Neil Macdonald from Gartner came up with it, which is the, he calls it the Cloud Workload Protection Framework. He's stack ranked all the things you could do to protect the workload, in order of how much risk it gets rid of. The things at the bottom, the big risks, patching, segmentation, application control, protect the memory, encryption, those are all things that have to do with reducing attack surface as opposed to finding the attack of the day. The stuff at the top, you know, antivirus running for a server inside the data server behind all these walls, it's not, it's marginal residual risk, so the focus of VMware, in the security realm, has been we can not only bake security in, so you're not adding boxes, you're not managing agents. More importantly, we're in this unique position to understand where things are supposed to be. You know, for example, the AppDefense product that we launched last year, you mentioned, and we have a bunch of new stuff here, we're leveraging the hypervisor itself to understand the intention of the applications you loaded on it, and then use the hypervisor to say that's all it can do, nothing else. It flips the model completely from saying I'm going to try to find bad things to I'm going to really understand what good it's supposed to be, and that's all that's allowed. >> So you're narrowing the scope with policy, bascially? >> 100%. >> I mean, so this comes up with IOT, I heard a guy saying these light bulbs that are WiFi-enabled have full, multi-process threads, we don't need it, it's a light bulb. It needs to go on and off, so by bounding, by bounding the apps, that's what you're saying. >> That's exactly right. >> Using virtualization mechanisms to do that. >> Exactly right. We've never used it for this before, but the hypervisor kernel does a bunch of pretty amazing things, we just. It can see what's running, it can see what you provisioned in the first place, it can do that without adding an agent, it can do that in a way that can't be turned off, without a lot of overheard, and it can do almost anything in response. So the central idea behind AppDefense was, let's use it, it will tell you what all your VM's are for, now you have an application view that says here are the applications in your infrastructure divided into services, divided into machines, here's what they're supposed to be, tell us what you want to have happen if what's running doesn't match what you intended. That's it. >> Well, technology's perfectly positioned with that. And Pat was mentioning NSX, and I want to ask about that in a second about NSX. >> Yes. >> But I want to put you on the spot and ask the question that comes up all the time. Two factors in security that's hard to get your arms around. >> Yeah. >> One is, patching. Which, you said, you don't patch stuff, so you don't patch up the whole surface area. Two, social engineering. 'Cos you've got human error whether you pass or not, did I configure the bounding properly, that's a human error, batching, I call human error and social engineering. Those are two factors that are still prevalent in security. >> Absolutely. >> Your thoughts on that? >> Well, you can't patch humans, so that is all weak, and then the thing that we can really advance there is to move increasingly to automation, and do things that, candidly, humans probably aren't the best at doing that, but you can't just automate, old, unreliable processes, that just makes them faster, it doesn't necessarily make them better. >> Yeah. >> I think that the key to a lot of this is, >> Automating a bad process still makes it a bad process. >> Yeah, it's just faster. (chuckles) It's more efficient. >> (chuckles) An efficiently bad process. >> Exactly, exactly right. So, you know, I think a lot of the automation and ability to compartmentalize things and, candidly, a lot of the policies, whether it's for patching, etc, when thought of through the lens of an application as opposed to like, what's our policy for patching the patient care system, how often? Is my patient care system unpatched, is different from saying I've got thousands of machines, and some of them are patched and some of them are not, how do I prioritize which ones I should get. It really does, not only simplify things, but align things to a business outcome, which really, it goes back to a risk management decision a business has. >> Ransomware is a great example to your point earlier, I think you said that off-camera as well, is that, you know, you don't want to attack the same treadmill of problems. So ransomware, one guy said that on theCUBE here at another event said that, ransomware's easy, just patch them back up and you're good. >> Yeah. >> That sounds simple, doesn't it? >> Yeah. It-- >> Surface area, patch it, back it up. >> Yeah. Sometimes there's reasons why the patch, that people just don't roll out the updates to an absolute critical server on the trading floor, sometimes they have challenges. But, you know, interesting enough, yesterday we were showing, we had a live, we did a live attack on stage with Petya, with a live strain or ransomware, throwing it against the machine, we showed why it worked, and we were just using AppDefense to say, all right, let's assume you didn't patch it, AppDefense is going to make sure that application can't do anything you didn't intend it to do, the ransomware doesn't work. And it's not because we understand what malware you had there, it's because the malware, to work, has to change. >> I'm thinking about security strategies in general for organizations. You know, given that credential theft is still such a huge problem, are the things that you can do with analytics, because you may have visibility on certain parts from the infrastructure standpoint, that you can do to maybe not stop credential theft, that's bad human behavior, but to identify some anomalous behavior. What's happening with analytics, and what role, if any, does VMware play? >> Yeah, so, again, the central theme, I suppose, is summed up as, we're trying to say, here's your applications and data, what is intended? On the network with NSX, on the compute stack with AppDefense, Workspace One is trying to address that from a user and a device perspective. And the questions one asks for what your discussing is, is this who they say they are, are they on the list of invites, and are they on a trusted device? And those were traditionally silo decisions, separately. And what we're saying is, it's about answering those things in concert that allow us to spot the stuff that doesn't make sense. It's the ability to answer them in concert that allows you to make that less intrusive into the daily activities of the users. So the work that's happening on Workspace One Intelligence to do analytics looking at the device and how the device is behaving, the user, and how the user is, what indication, what risk do we see? This may not be the person or the risk that they're working from a device I might not trust even if I trust who it is. Either of those might tip me off to say, you know what, I might want to limit what they have access to, or this is the place I need to look at first. Again, I think that starts to clarify and put things in context. >> We were talking off-camera about the infosec team and the IT team, and often they're in silos and not talking to each other. What's the right regime, in terms of what you see in the marketplace, of best practice to approach this problem? >> It sort of depends on the size and scope. But the infosec team, often lead by the Chief Security Officer, often, in most organizations that I deal with, own the security operation center, security architecture, and governs it's risk and compliance. They're mostly looking at setting overall policy, and seeing when things are breaking down, and reacting to it. But as you point out, there's a lot of security happening in the infrastructure teams, whether it's firewalling, segmentation, locking down the computer stack, even things like AV running by end user services teams. They're looking to set policy, and things that are getting in the data path, that are about locking things down, and they need to collaborate. They need to, to be effective, they need to each know their roles and operate from a single source of truth, and that's where it's breaking down. In fact, I would take it a step further. The other group that needs to be part of this conversation is the application team. And as we move to Dev Ops, and the applications change very rapidly, it's going to be increasingly important that they collaborate, and not ignore each other as silos. >> Mm-hmm. >> I want to ask you, I know we've got one more question left, but, I want to get out there. You mentioned adaptive segmentation is an extension of where micro-segmentation is going. A lot of buzz here at VMworld on micro-segmentation. What is adaptive segmentation? >> So it's really the next logical evolution. Which is, we've taken some of the technology that we've built with AppDefense, that can figure out and map out the applications. Now we have manifests that say what these things are for, and we know the patient care system is actually all these machines and how they interact. It's basically saying, why don't we have the system program the micro-segment, and do it in an automated way? Now you have a micro-segment that is automatically and perfectly aligned driven from the application itself. And the other beauty is, the adaptive portion, which says, if the application changes, that's pushed down through puppet or chef or it's, or something is modified through patching, to have the system to be smart enough to see that's an update, and that automatically changed the actual segment, and lock the network and compute down. That's what we're doing there. >> What is the impact to the customer? And what is the impact of that? >> It's simpler. Much faster time to actually go in. It's simpler, and it's a much more accurate representation of the application. You lock things down both from lateral and direct attacks, so it's a big deal. >> Okay, final, final question. I always like to get the final question in here. Tom, tell us about a prediction for 2019. Next year VMworld, what are we going to be talking about? What are going to be the security issues on the table? More of the same, rinse and repeat issues? What is your prediction for 2019 in the security world? Well, you know what, I think security's going to get more complicated before it gets simpler. I think we're on the right path, but there are so many moving parts. I think, one thing, I don't think you're going to start seeing people increasingly open to security being delivered as SAAS. Because there's too many benefits of machine learning across populations of users. I think we're going to start to see security models that are, to fool one of us you've got to fool all of us. I think those are the kinds of things that are going to be the needle mover. >> Sounds a great service, security's a service, theCUBE is a service bringing these three days of wall-to-wall coverage, we'll be back with more on day three coverage. I'm John, for Dave, stay with us for more after this short break.

>> Live from Las Vegas it's theCUBE! Covering VMworld 2018. Brought to by VMware and its ecosystem partners. >> Hello everyone, welcome back theCUBE's live coverage here for day two, were kickin' it off, for wall-to-wall coverage, three days of CUBE interviews here in the VMware village, the VMworld village. I'm John Furrier with Dave Vellante, our next guest is a special guest CUBE alumni Michael Dell, CEO of Dell Technologies, Founder of Dell, Michael Dell, named after the company. Great to see you again, thanks for comin' on. >> Great to be with you guys, and thank you as always for the incredible coverage you provide for our events, and so many great events across the whole industry. You got two two teams goin' here at the same time. >> It's great, isn't it? >> Tremendous coverage. >> Thank you. >> Great community. What's interesting is this is our ninth year doing VMworld, and we've gotten to know the community really well, and it's just been so much fun and it's been great to see everyone, and more exciting now is this years keynote which I thought was pretty interesting. You know you look back just four years ago the cloud, and what was doing cloud, who wasn't doing cloud, and everyone's throwin' around "well they don't have a cloud strategy" what does that mean, right? So it's very clear what's happening with cloud right, everyone knows the cloud's going to be there, but the role of infrastructure hasn't changed, so, at the end of the day you made a big bet, going taking Dell private, and the things that you've been doing certainly with VMware and others; infrastructure is never going away, so, that was a good bet. I mean, storage doesn't go away, all these things are still happening, and Amazon announcing RDS on VMware on-premises is absolute validation from the customers that on-premises activity is still going to be super relevant in a cloud world, and so it's not like anything's really changed it's just the rearranging of the resources. Your thoughts on this trend, and your bet on infrastructure? >> It's a data economy, right, it's a multi-cloud world, that's a two way street. And if you think about the billions of connected devices, the explosion in data, overlay on top of that, all the new computer science, that requires all kinds of new infrastructure, there's a boom on the edge. And so, absolutely, this is why you see our business growing so quickly, and doing as well as it's doing and we're investing in innovation, strongly, you saw it you know yesterday, today in the keynotes and, it's resonating extremely well with customers. And so, I think we're very well positioned, we've been gratified by the response you know from customers and partners around the world and look you know the you know every business is increasingly recognizing the importance of you know technology and data, and, you know that requires lots of new tools and technology, and it's why we created Dell Technologies, right, to be the essential infrastructure company and you know it's working well, it's actually working better than we thought it would work. So, it's all good guys. >> Well, you know, my old boss, whom I think you knew Pat McGovern used to say that 90% of mergers and acquisitions failed to meet their objectives, so then we have many, many examples of that. In roughly 36 months from when you announced the merger/acquisition, you've completely transformed Dell, you went from a company that was like sort of a half super power obviously in client, and you were relevant in other areas, but you weren't number one. To like number one in all the magic quadrants and in record time, it was one of the most amazing transformations I've ever seen. >> Thank you, thank you. >> You're welcome, but, I'd really like to understand, you know, what were the conditions that allowed you to do it, obviously they say it's better to be lucky than good, you're both good and there's probably some luck involved. What were the conditions that allowed you to make that transformation in such record time? >> Well certainly a big one was the acquisition of EMC. >> Well right. (all laugh) >> And along with it, you know VMware and Pivotal, right? And we theorized, and actually as you guys know, this story goes back a long way, right? It actually goes back to 2001 when Dell and EMC started working together, when VMware it was just a little, you know, when Sanjay showed the slide about the server virtualization; actually before VMware was server virtualization it was workstation virtualization. >> Workstation, that's right. (laughs) >> And we were an investor in VMware, and we thought that was cool. Anyway, so you fast forward to 2013, we go private, 2014, Joe Tucci and I restart the discussion that we'd had earlier back in 2009 about combining together, 2015 we announced it, and we thought that if we could combine everything together that customers would really like it. And, you know, thankfully as we've found that's been true, it's been more true than we thought, and, and the innovation engines are crankin' on high, you know $12.8 billion in R&D invested in the last three years. And you see here at VMworld and at Dell Technologies World, the strength of the roadmaps, so, every turn of the crank we're just getting stronger and stronger. We never believed that you know everything was going to go one place or the other, okay, it's actually great that the edge is booming. Now if you said "Did you know that five or 10 years ago?" No, I didn't really know (laughs) but you could kind of see some things starting to happen. Look, you know distributed computing will be even more distributed in the future. (laughs) >> And so you had good products, you had a great combination, that makes a lot of sense, and you know we were. >> And incredible people too, >> The team. >> The quality of the talent that we are blessed with is amazing, and it's a flywheel, because you can attract the people, and the very best people, and develop them and train them, and they want to come be part of the winning company. >> And we saw a lot of, and they saw that on theCUBE we commented about the synergies that were probably unrealized or unrecognized by others, you obviously saw that. But then also there's the other side of the equation of the financial opportunity, you took a financial risk, you put your own money into the deal, there's a lot of engineering going on- >> We took the risk, it's the man in the arena, you know, and not everybody wanted to take the risk, and, you know I, I'm happy to take some risk. >> Yeah, but the rewards are lookin' good, I mean, I mean if you're keepin' score, which I'm sure you are, the numbers are lookin' pretty good, so. >> This has been good. >> There's the financial side of it, and then also risk/reward payouts are also part of the entrepreneurial thing. (laughs) >> Yeah, I mean if you look at our last quarter, you know, gap revenues up plus 19%, non-gap revenues up 17%, data center, ISG business up 25%, right? I mean we're clearly gaining share, number one in storage, in all flash, in NAS, you know in backup and data protection; and every category of storage unstructured, you know, we're bigger than number two, and number three, and number four, all combined together! (John laughs) Number one in servers, right? Number one in virtualization in all flavors, you saw what Pat showed you know with the progress with NSX, with Workspace ONE, obviously server virtualization. You know, number one in client as well, right? In you know client revenue, so. The business is quite strong and healthy, and what's really interesting is if you look at it across customer types, you know the very largest, the small, the medium, the government, the state, local, top 50 countries, pretty much everything is growing double digits all across the world; every customer, every route to market, every channel. So, you know, I think the industry is stronger than people understand, that's the first point, I think there's this data economy, and this tsunami of data that's being created, and that's driving demand for infrastructure products and solutions, which we have the best in the world, and then on top of that, we're gaining share. >> These market forces are interesting. >> So all of this together is, it's a good news story. >> And the market forces you mentioned that really were somethin' that I think a lot of people in the industry at the time that you were contemplating the deal. And we talked privately about this, so I want to kind of bring this up here on theCUBE, way back when. The industry pundits were looking at the industry almost like a siloed map of TAM, total addressable market. And these other forces, if you factor those in as a market force, it changes the analysis of what you talk about, and we talked privately many times, but one time we were talkin' about the maturity and size of the on-premises IT market, it wasn't "Oh, IT's dying!" It's like huge! (laughs) I mean it's massively mature, so, and we talked privately about that; that's somethin' that a lot of people missed, they didn't miss that the size of the market was so big, might've been you know flat, but it's a ature market, but then these outside forces transform, and now the deal with Amazon highlights that bet. >> It's a two way street, now it's goin' the other way. And look, if it's obvious, there's probably no opportunity, right? (laughs) And so, you know I've kind of made my life of doin' stuff that maybe wasn't quite obvious to everyone, okay fine, that's just how it goes. So, maybe it wasn't obvious to everyone, and I remember when we announced, you know in 2015, everyone was like "Whoa, whoa, what are you doing?" right, so why are you doing it? And now it's kind of like oh, that seems like a really good idea, right? (John laughs) Look, I'll tell ya what I think is maybe not so obvious right now, although I think people are startin' to figure it out, is boom on the edge, I think the edge will be bigger than the cloud. The private cloud, the public cloud, the SaaS, the edge will be bigger. >> And what are some of the tell signs on that? How can you tell? >> Okay. Very very simple, go to ARM, and say how many microprocessors, and sensors and controllers should be sold? 120 billion, okay. Seven billion people in the world, 120 billion, that's already sold! Okay. This isn't the next five years or 10 years, the numbers are only going to go up; and that's just ARM! So, you think about everything becoming intelligent, the cost of making something intelligent going to zero, the cost of prediction, in the form of AI, and learning, and inference going to zero, and how that refactors the economy and the explosion in data as a result. Oh my God. (laughs) >> So that's a- >> Incredible opportunity for infrastructure. >> So that's a factor that makes that AWS VMware deal more sensible, because the conventional wisdom was just that, it was a one way trip to the cloud; it's turned out to be a boom for the data center. So, edge is maybe one reason why, but, perhaps there are others, your thoughts? >> Well it's, you know, look at TensorFlow, you know we, let's just go back to our last quarter, right? Server and networking business grew plus 41%. Well if server and networking business is growing plus 41%, everything can't be going to the big three public clouds, it's not. So there is a boom on the edge, it's the AI, it's the ML, it's the software-defined data center, cloud is an operating model not just a place, right? And, you know, again, you know big growth in our appliances, you know taking all the innovations of VMware and expressing those in you know consumption models and you know making it easy for customers to deploy, it's all workin' quite well. >> You mentioned the- >> And we're uniquely positioned you know as Dell Technologies to be the best choice for customers. >> Yeah, you're the store for all of us. I want to drill down on the IOT edge boom, the tell sign you mentioned is really interesting, I like that, but also I want to tease out what Pat Gelsinger said on stage yesterday, he said, you know IOT, 'cause you know we're being kind of critical of the IOT, not super critical but, it's maturing, but there's no real products yet available in a true sense. But Pat said "It's being connected now." So you mentioned ARM, penetration used to be, you know that from the PC game, everyone should have a PC, now everyone's got PC's and laptop's; so the penetration game is not the issue, they're already there. So as things be fully connected with mobile, it's not so much the penetration numbers per se, it's the network ability, and the intelligence, so. >> Yes, that's right. >> AIOps on the IT side, AI in apps, and Pat said the apps are the networks, so this is a new networking dynamic, networking things together, making them more intelligent is the new metric, do you agree? >> Absolutely, and look, most of the 120 billion aren't connected, but, you know they're going to be connected >> They have phones. (laughs) >> And there's going to be 1.2 trillion, right, it's just going to keep growing. You know in five years, in 10 years, it's going to be way way more, and then you got 5G coming, and it'll be node-to-node connection. And so, yeah, and then you overlay the AI, it's, all of this is reinforcing itself. You know at the center of this there's a relatively simple thing that's happening, right? And it starts with data, right? And you know this is no different than it was in the '60s or '70s, right? With the beginnings of IT, it's just now, the cycle is going much faster. Starts with data. With your data, you make better products and services, right, and when you make better products and services you attract more customers, and you get more data. It's just now, right, the number of devices, number of nodes, and the network connectivity, and then you insert AI and machine learning and neural networks, you know etc, on top of the data, and then it goes even faster. And that wheel's just spinning faster and faster and faster and it's not going to slow down. >> It's causing a renaissance. >> You talk about networks, and I, there's a metaphor, I like the metaphor of networks of data. And you talk about you know you lived for decades on the cadence of Moore's Law, well that's not the innovation anymore, John calls it the innovation sandwich data plus AI, and cloud for scale. >> And you'll take your intelligence, and your compute, and your infrastructure to your data, that's why there'll be a boom on the edge; we're already seeing it in manufacturing, in retail, and you know, anybody that thinks that everything's goin' to the center of the universe somewhere, it's jut not right. But hey look, when there's some disagreement there's opportunity, and I'm perfectly willing to step into that opportunity. >> Opportunist! (all laugh) >> So obviously you're doing well on the upside, and the rest of your take, and what I think the operating model's interesting, you mention that cloud and DevOps flipped everything upside down, where apps are now programming networks. What you're talking about with data is a sideways force coming in, that's disrupting IT's footprint as well as the operating model, and I think this is what, I think it's compelling what this new flywheel between cloud, mobile, ML, AI, and edge, is that that integrated flywheel is this vitreous circle. More compute, faster access to data, faster access to data, better AI. So better, more data, more accurate data, better AI, that circles around, that's a flywheel. This is coming sideways, this is not an upside down, this is just a ... >> And what our customers are realizing is that because of all this, they need to have more developers, right? And they need to express their competitive advantage in the form of their data and with software. And, so what they want is a developer friendly, developer ready secure infrastructure that is cloud agnostic, cloud neutral, and can operate in an autonomous fashion; and they can decide exactly where to put workloads, based on security, performance, cost, you know, etc, right? And it'll be a workload dependent type discussion. And you know again, with Pivotal, with VMware, with Dell EMC, we are really well positioned to help our customers with that. >> So I got to ask you, so if, what you just described, to me, is a new era, it's not a cloud of remote services anymore, it's this ubiquitous, intelligent platform; and it feels like it requires a new brand. (laughs) And we're seeing the evolution of the Dell brand, the Dell EMC brand, now Dell Technologies brand; talk about the brand, and what we can expect going forward. >> I would say, light touch, right? (laughs) And so, you know we, revealed the Dell Technologies brand when we did the combination, but we also kept the you know important brands that've been part of the companies history, in the form of VMware, and Dell EMC, and Pivotal, and so. >> RSA. >> Exactly. SecureWorks, and Boomi. >> Boomi, yeah. >> And so, if you've got a business that's you know close to $90 billion, and it's growing at 17, 19%, you know you don't really sit around and say "Hey, let's change a bunch of stuff!" Right? (all laugh) So, I think people are understanding what we're doing, they understand what Dell Technologies is more and more, and the brand is resonating well; so we feel very good about how all that's working. >> You said on theCUBE here that VMware's the crown jewel of Dell Technologies, obviously you can see the results. Elaborate on that now, give us the updated answer today, 'cause obviously, you look at some of the things that are goin' on. You know NSX has turned out to be a very good investment payout from VMware as kind of an interconnection point between multiple clouds, the Amazon relationship is deeper, and it's very clear for the field sales teams, it's great go-to-market from what we're hearing. And then the senior managements are involved in both levels of those companies. So VMware actually is interesting position in going to a whole nother level. Update us on the crown jewel status of VMware. >> So, you know within the world of infrastructure, in the software domain, a software-defined data center, you know VMware is the successful company, by far, right? And, the level of innovation that is coming from VMware is really profound, I mean it's the highest it's ever been, 'til next year, right? (laughs) Just go back and look at Pat's keynote and the things that've been rolled out, and you know we're completely and tightly aligned you know as a Dell Technologies family, so. You know VMware is at the center of everything we're doing, in all of the areas that we've talked about. At the same time, right, we've kept the ecosystem open, you see here on the show floor, the whole industry well represented, and participating and engaged, and that's been an important part of VMware's success from the beginning, and will be forever. >> Well we used to laugh out loud, belly laugh when people said you were going to sell VMware, I mean it was just like that made no sense, (John laughs) but it's given you incredible financial flexibility, it throws off cash, it accounts for nearly, I think roughly half of the profits, and now you're taking the $11 billion dividend which gives you the ability to clean up the capital structure, create more clarity, and then become a public company again; so can you talk about that a little bit? I don't know how much you can say but, you know we used to joke about the 90 day shot clock, seems like that's where you're goin', you're obviously comfortable there, you're a well run company. Your thoughts? >> So, you know, I've been doin' this for almost 35 years (laughs) and 25 years of it, you know, we were a full public company, we're actually a public company now, right? We make all the public filings, it's all out there and available; but the equity of Dell Technologies so that the, we have a proposed transaction, which you've seen. The proposed transaction will have the effect of retiring the tracking stock, which we created in the combination. >> At a great premium. >> Exactly. And that, you know, retiring the stock, it'll be replaced with a combination of cash and equity in Dell Technologies. What I see is no change in how we're operating, and our strategy, our relationship with our customers and partners, and in VMware's independence. You know, what I would tell ya, if you've got any further questions we have SEC filings, you can refer to those, we've got all kinds of answer in those, and we have an investor day coming up you know in September where you know we'll go into more detail. >> Is that at HQ, the investor day, is that in New York? >> That's in New York City. >> Well, products drive value, value provides customers the ability to pay you for those valued services, that's called a business model, you've got a good one goin' on. Congratulations, congratulations on the great bet, and it's great to see the results and it's fun to keep in touch, thanks for comin' on theCUBE, really appreciate it. >> Yeah, congrats! >> Thank you guys very much, thank you. >> Thanks for spendin' the time. >> Thanks for the great coverage. Alright. >> Great to see ya. >> Michael Dell here on theCUBE at VMworld 2018, I'm John Furrier with Dave Vellante, more live coverage after this short break, stay with us, we've got full day two and day three coming two CUBE's here in Las Vegas, stay with us, we'll be right back. (bubbly music)

(soft music) - [Narrator] Live CUBE coverage at VMworld 2018 continues in a moment. Live from Las Vegas, it's theCUBE! Covering VMworld 2018. Brought to you by VMware and its ecosystem partners. - Hello everyone, and welcome to back to theCUBE, live coverage here in Las Vegas with VMworld 2018. This is our three days of exclusive wall-to-wall coverage, two sets, it's our ninth year covering VMworld, when Dave and I started theCUBE nine years ago, Paul Maritz was the CEO, he actually got referenced on stage by Pat Gelsinger. I'm John Furrier with Dave Vellante, our next guest Ray O'Farrel, CTO, Chief Technology Officer at VMware, keynote today on stage with Pat; great to see you again, thanks for coming on. - Really good to see you guys again. - So, reaction from the keynote was very positive. Probably, from a content standpoint, probably one of the most meatiest content pieces I've seen, mega news, serious announcement with Amazon, with Andy Jassy coming on stage releasing the Relational Database Service, RDS, on VMware, on-premises. Monster news. That is like, I don't think the world has yet felt the reverb for this thing yet. - But that was only one of the many stories. - [John] That was just one, that was just like (makes explosion noise). And then the CloudHealth acquisition, and you had tons of demos, pretty intense. - [Ray] Well, it's been- - Summarize what you did (laughs) in ten seconds. - Summarize all of that. So, you know, the key thing that we wanted to achieve with the keynote was obviously to make sure Pat drives the the vision that VMware has and, a lot of focus on that was focused on multi-cloud, this view of the world that you've now got multiple clouds emerging. And you know one of our key rules is to make sure that enterprises are able to work across all of those, networking, how we do management, how we work across all of these, and CloudHealth is a key part of that, making it easier to use cloud, in particular multi-cloud. You know as the CTO I get the fun part of tryna you know let our customers know all the cool work that the engineering teams are doing, so one of the things we want to do is make sure we put a lot of good demos in there. The feedback we get from our customers at VMworld over and over again is they want to see demos, they want to know that stuff is real. You can take a look for instance at the hands on labs. I came in here on Saturday night, walked down there about 6:30 am on Sunday morning, and there was people lining up to go in there and use those labs. So what did we talk through? Broadly speaking we spoke to how you can use VMC on AWS, and the easy way it is to migrate vSphere applications onto vSphere on AWS; we had some new features there around live migration. The next thing we spoke about was around RDS itself and what this project is about. Broadly speaking, at its most basic, it allows you to take the RDS components from Amazon but run them in your data center. With all of the implications of that in terms of how your developers work and they build those applications. We spoke about Project Dimension, which is also around a now delivery as a service, a cloud experience, but again, at your infrastructure, whether it's at the edge or whether it's your data center. And, you know we spoke about what we're doing in blockchain, some opensource components that we're doing over there. New features of Workspace ONE, particularly around the relationship with Dell, and how that will now be combined with some of their laptops And, oh and of course, what we did with some of the Nvidia GPUs, demonstrating the ability to be able to run the most sophisticated AI workloads on a vSphere environment. And I suspect I forgot something in that list, but- - [John] You're going to have to hit the pillow tonight and have a good nap, and crash. - [Dave] Project Magma. - [Ray] Project Magma which is a very future looking concept around basically where we think AI and ML is going to be used to drive a lot of the automation moving forward. - [Dave] Self-driving data center, - Self-driving data center. - [Dave] I think you'd call it (John laughs) Are they coinin' a new term there? - No it's great, we can reuse an old term, and you know rebrand it. - Auto pilot. Put your data center on auto pilot. I want to just drill down on one, on the Amazon relationship, because that was obviously the height, big news in there what you're talking about is the depth of the relationship is deep on the partnership side. I want to, and you guys, you pointed that out, I want to amplify that, but I also want to ask you around the RDS demand. You know, talkin' to some of the Amazon sources, they tell me that the demand for this was very strong, over multiple years. So, first on the RDS, the demand, some of the customer feedback, this is not just you guys in a room goin' hey, let's just do this; it makes sense, but it's customer driven. - Yeah, when you look at what VMC on AWS actually is, it's creating this bridge between the on-prem and the private cloud, sorry, and the public cloud on Amazon. But, initially most of that is really an I as relationship, yes we can move workloads, yes we can move VMs, yes we can manage networking, but one of the key things you want from a public cloud or from cloud in general is access to services. So, as we went down that first part of saying we'll give you this basic infrastructure, very quickly customers began to ask for some other things, some other aspects of that, and that of course was services. So after lots of discussions around what are services, one, that are appropriate to be able to put into this new type environment, but which had to demand RDS certainly rode very quickly to the top of that. In the end almost everybody has some form of database in their application, and so it's a very likely start for us to make them. - So I remember when customers first started wanting to run, to virtualize Oracle, with of course VMware; and Oracle, didn't really embrace that early on. They would say things, their sales guys would scare the customers, we're not going to certify it, but then some of the customers said "Dam the torpedoes, we're going to do it." it actually worked great. - [Ray] Right. - Now, I don't know if that's 'cause, just that's the inherent nature of VMware, or you guys had to do some work, so my question is: two fold, was that just the inherent nature of VMware, and what did you have to do or will you have to do to get RDS running the way that customers want it, trust it on AWS, I mean on VMware? - So, in the case of the Oracle situation, we didn't have to do a whole lot to make that happen, we were virtualizing in x86, Oracle runs on x86, and so you got that basic pattern and mix. In the case of RDS, the actual database that you're running on your VMware infrastructure, our database is such as my SQL, we run an enormous amount of those databases already, so that core aspect of getting the database running is not something that's fundamentally difficult for us to do The challenging part is, how do bridge all the management aspects of that? The RDS components, the APIs, that a developer wants to use, and which are used to using over on, with RDS on AWS, so that's where the work is involved. Now by the way, you're implying that maybe this is a future thing, right? A lot of that work has already occurred, in fact, you know the demo you're seeing is not based on this is what we could do at some possible time in the future, it is actually tied to some very close future releases. - [Dave] So recovery, I'm going to be co-, that's future release of recovery and all the things, if something goes wrong, I'm going to be comfortable as a customer that - [Ray] Correct, correct. - You're going to be backed. - Some of those things we still need to work true, because there's tons of features that you can begin to add onto this, disaster recovery, backup, all of those sort of things, and they're not all going to be there on day one, but you can expect us to continue to add all of that. - [Dave] And you'll have all of those? - Correct. - Now the other question I got to ask you is about migration. When I hear the term migration I go, ugh, you know IT practitioners they tighten up, but what I heard on stage today is we're going to make this really easy. But moving data, help me square that circle, Ray, because, you know data, people say data has gravity, speed of light, network bandwidth, proximity. What's the secret sauce that enables you guys to solve those problems? - So the core secret sauce there is if you're virtualized on VMware on-premise, and you're using VMC on AWS, the basic unit of execution is still that virtual machine, and that virtual machine encapsulates the storage, the networking, everything associated with that box, right? So virtual machines have that very core strength of encapsulating not just the application, or some aspect of the, even some aspect of a minimal piece of the operating system, it encapsulates everything which is tied into that box almost on a physical level. So when you say I'm going to move a virtual machine, you're moving the disk, you're moving the storage, you're doing all of those things. So now think of a database running in a virtual machine, it might not even be the applications, just the database, we're able to capture that and represent that as we moved the virtual machine, you're moving all of that as well. Now there's two aspects of that, one of them is moving the underlying storage, the disk, which might well be even a a virtual disk on NFS or something like that, that's slower task, and that's why we leverage vSphere replication for that. And then the final live part which is, it's always the cool part, but is in fact in this stage maybe not the most difficult part, and what we're describing here is moving the actual memory contents of a given VM and flipping it over to VMC on AWS. - [Dave] Okay, so the key there, you've got the replication piece, and then you just unhook the original and then you're up and running. - Correct. Traditional vMotion relies that both servers access the same disk, so I don't need to move the disk, in this case I need to actually move the disk, and that's what the replication does. - [John] Ray, I want to ask you about something that Pat Gelsinger kind of cheesed out on the keynote. You could tell he had so much confidence, he wanted to expand on this one section but he got a couple digs in on it but, he did point out that the telco piece was very big; and only, he had a percent, I think 10% or 20% is virtualized when enterprises are like 80, I forget what now, I forget the exact numbers but his point was: huge opportunity in telco. What was he referring to there? - So, broadly speaking, if you look across most of you know where workloads run, you look at your IT infrastructure, you look at most of the public clouds and private clouds, they're virtualized to an enormous extent. Now when you go into the telco side of things and begin to look at what's happening at the edge, what's happening in the large telco infrastructure, both, a little bit from a cloud point of view, but also from everything to do from all the services and so on that the run; much of that is not virtualized. Now we actually made a very distinct focus on that over the last few years, we created a, basically a product line and a mini business unit, focused on telco, and that's where you see products like the virtual network functions, all of those technologies coming from. But actually the key product from that area is actually VIO, VMware Incubated Openstack, that's because the telco providers, to a large degree, attempted to leverage Openstack, had some challenges of getting the reliability, the stability you need on that, so what we did was merged the hypervisor, the infrastructure of VMware, with the Openstack management APIs, produced VMware Incubated Openstack, and the telco providers are very aggressively taking that on - [Dave] Now, I got to ask ya, whaddya got against capex? (Dave and Ray laugh) Pat said "You should never spend capex for DR again." it was basically- - [Ray] Yep. So I mean, I think the key part of that solution is it is now so, I will use the word easy, the technology behind it is not easy, but it easy for an end user to be able to say: "I can connect my application from a private infrastructure to a public infrastructure, in a way which is very highly connected using NSX, which is easily replicated, which is easily moved; therefore, I now have a ready ability to be able to create DR scenarios leveraging the public cloud." It is easier than it's ever been before, so instead of building another data center to do that, leverage VMC on AWS, leverage those type of technologies to be able to do that. - Ray, can you clarify, or amplify the VMware Cloud Foundations, how does, trials and tribulations over the years has evolved, it's now front and center in the conversation. How has that evolved from a product standpoint, tech, is it integration layer, how are you guys looking at that, what is the role of VMware Cloud Foundation, and what does it mean for your partners and customers? - Yeah, so I think that, your comments about it having a a kind of an early mixed reaction or so on is actually partially because a naming challenge that we called right? VMware Cloud Foundation is a unified story where we basically take the core elements of the SDDC and we combine in management infrastructure with that, which is actually called SDDC Manager, we don't necessarily spell that out but it's combined into that. But that's the key aspect of this, and then we build architectures based on that; so VxRack is based on VMware Cloud Foundation. The infrastructure which runs in Amazon which we manage as part of the VMC on AWS is built on VMware Cloud Foundation. So it's an architectural and, it's an architectural statement as opposed to a product statement. Where the confusion arises, we also have products that people call VMware Cloud Foundation. One of the ones they're with now as an instance of that is for instance VxRack, right? Which is basically a rack of infrastructure, think of it as a really big VxRail, but it's got all of this management software combined with it as well. And actually, you know your comment about that having some mixed reaction, some of that is because of our renaming that - [John] Renaming. - we've done along the way. But that is actually growing, and quite successful product at this stage, so. - It's been getting a lot of good buzz. - It's getting a lot of good buzz, yes. - [John] And the value is what? Times in market on, on solution building, or pull out, what's the main value? - In some way it goes back to the core value of hyper-converged infrastructure, somebody else is taking care of making sure that the software components all blend together; somebody else is making sure that there's any easy way to update and manage all of these things together, and in many cases, making sure it's well integrated with underlying hardware. So it's all around making it easy to get that basic SDDC up and running. - [Dave] So I got to question on your architecture, and I honestly don't even know how to ask it, but, maybe you can help me as a technologist; you've got, you know the VMware architecture which was developed initially decades ago, and now you've got all this microservices, and Kubernetes, and containers comin' into the fore, and you see the quote unquote modern architectures, speed of deployment, software release is much faster, much more cloud-like, cloud first. How do you go from you know the historical architecture to that level, how do you bridge the two worlds? - So, as with any company, as these transitions have taken place, we've had to be able to make sure we invest in those new techniques and new technologies as well. So you see for instance VMC on AWS, you see for instance Project Tango the cloud-based VR realms product. All of those are cloud-based infrastructure using, you know those more, well I guess they're described new or modern ways of developing applications, microservices, containerized, leveraging Kubernetes and so on in the mix. So just like the rest of the industry, we've been doing the same as part of that broader sorry, that broader industry momentum. There isn't a conflict that you, I think might think is there. The bottom line is our primary purpose is to deliver enterprise software which is solid, stable, secure, easily connected to the rest of the infrastructure. And that might sound a little bit boring, but it is the thing that keeps most of the data centers running and safe. VMware's ESX architecture, VMware's VC architecture has been at the very heart of that. And while they've matured over the years, right, they're still at the very heart of that virtualization part of what we do, but all of these other things we do, what we do in terms of cloud monitoring, what we do in terms of Wavefront, what we do in terms of VMC on AWS, they're new code, new architectures, broadly expanding that story, leveraging microservices and the things you would expect in that space. - Well, and VMware has proven to the gold standard in that regard. Maybe it is boring, but it's super important. - [John] So you got some compliments on theCUBE today, for the work you guys are doing, Andy Bechtolsheim was on earlier, a well-documented career he's had he knows a thing or two about networks. He said "VMware as NSX is ..." this is a quote from today, "... is the best solution that's available today that I can use for a use case of the large numbers I have between smooth connection between on-premise and off-premise public cloud, into the future, to edge, and telco, and all other things cloud." - Yeah, I'm not going to argue with that quote. (laughs) - [John] So, instant testimonial. Okay, NSX has become really this, and Pat was giddy about this last year, he's all like, you watch more NSX, you know more goodness coming; it seems to be the center piece to the a lot of the VMware's connection strategies to cloud and other things including manageability. What's the big thing about NSX, what should people know about NSX? - I think the single biggest thing is software-defined networking had a promise, and the promise is this highly flexible, easily configured, and in many ways, automated, or policy-driven in some cases; networking infrastructure. So it's all around that flexibility and fluidity of software-defined networking. The key strength that NSX does, it delivers on that promise, so it's easy to say software-defined networking, it's not easy to build it, right? And that's where I think NSX is proving all of its strength, it is a very strong implementation; I would argue, obviously, the best implementation of software-defined networking. So that testimonial is an echo of that, it's delivering on all the things you expect from a software-defined network. - [John] And what is NSX enabling? - In terms of the cloud connectivity story which you just described a second ago, what it enables is, really in some ways, because it is not tied to a specific infrastructure, I'm able to run NSX on a public cloud infrastructure and on a private cloud infrastructure, or on a hyper-converged infrastructure, but it's essentially the same NSX. It's the same control plane, it's managed in the same way, all of those different instances know how to interoperate with each other. So what it's enabling is this massive ability to have these networks very quickly brought up, connect to each other, and reliably communicate with each other, and be managed in a unified fashion. - [John] And it's targeting one of the hardest things people are working on which is interoperability. - [Ray] Correct, it's also targeting security. I mean one of the things when we think about networking that you should never forget is this key aspect of security, and NSX is clearly targeting that as well. So some of the things, even the features you see around app defense, a combination of app defense and NSX gives you enormous power. Pat's made a good presentation today where he was talkin' about the adaptive micro-segmentation. You can only do that because you have a great NSX underlying that network. - What's interesting about the NSX, just want to get your reaction to is that that the people are talking about here on theCUBE and also in the industry is that by having the security at the application portion of it, when NSX plays, takes the pressure of the network teams; security teams can have comfort in their piece, and then, (laughs) you don't intertwine them. Is that true, or is that ...? - So I'm reluctant to say it's true because the bottom line is, everybody needs to be paranoid, right? (John laughs) So- - Well from a segmentation standpoint, form a cohesiveness, not this finger pointings, there's not a lot of, it's not thorny. - [Ray] Because it moves the networking layer up a level, and that level is closer to the application. But, when I really I looked at, I think the key strength there is because it's software-defined, because it's flexible, where you get a lot of the problems is when applications change, there's a new version of the application, or we're now popping up a new instance of the application; now because NSX is this software layer beneath that, it is able to react to that. So instead of, you know the finger pointing back to the security or networking person saying you didn't reconfigure the network to deal with my new application; instead, the application and the network are intimately bound together. Actually Pat used some phrase today where he said "I think the app is the network" and so, or something like that, he was talking a little bit differently about it, but broadly speaking that's what's going on there. It's all around the flexibility and the fluidity that you get from NSX. - [John] The application is a network! - [Ray] Correct, that's what he said, yes. - Was his word. - [Ray] Yep, yep. - Which I love, to think he's right on the money. Complex and if some services evolve, the service measure are right around the corner. - [Ray] Yeah, highly interconnected, you know what app, think of any application on your iPhone or your Android device, which doesn't rely on about 20 other applications or databases or cloud services. - [John] Well, Ray, we'll have to get you on a white board sometime, and have you do a deeper dive, love this conversation, congratulations. Final word I'm going to ask you, what is this VMworld all about on stage, if you could knot down the technical engineering successes that you've had this year, what's it about this year, what's the scene from your perspective? - So I think one of the key things is, we've got a lot of products, a lot of technologies under development for the last few years, a lot of them are now starting to see fruition and the light of day; you know, you know you spoke about NSX, NSX is now reaching a real strength right? But that's work we've had to start two and three and four years ago. So to me, that's probably the strongest thing here, products, ideas, research that we've done over the years, development we've done over the years is now becoming real, is getting out and making available to customers; and in the end, that's what we're about, tryna get those technologies to hand to customers. - [John] And we're going to do our job to share that, and we're going to be tracking the successes; and also thank you for inviting us to your radio event where you had your top scientists. - Oh yeah it was great, very good to see you guys there, thank you. - [John] Great to see the energy, and the engineering prowess of VMware continuing strong, technical team, community, and customer base. This is theCUBE, bringing you our hardcore tech coverage here at VMworld 2018, three days, we're in day one, stay with us for more after this short break. (bubbly music)

>> [Narrator] From San Francisco, it's theCUBE, covering Radio 2018. Brought to you by VMware. (upbeat techno music) >> Welcome back everyone. We're here with theCUBE in San Francisco for exclusive coverage for VMware's Radio 2018. I'm John Furrier, your host. This is the event where everyone comes together in the R&D and the organic engineering organization of VMware to flex their technical muscles, stretch their minds, compete for the papers, and also get to know each other. And the key person behind this is the chief research officer David Tennenhouse. Thanks for joining us today. >> Thank you John. Really glad to be here. >> So you're the chief research officer. You got to look at the company-wide agenda. But this event is more of a special event, organically. Talk about for the folks out there watching what's different about this event that goes outside the scope of kind of the top-down research. >> Yeah this is really, you know, for the developers by the developers. So when you said I'm in charge, I'm definitely not in charge. And you know, we have a program committee. There's a programming committee chair. It's much like the way an academic conference might be organized, where you know, there's kind of a group of academics that sort of watch over the content. In this case, we have many hundreds of folks that submit proposals into radio. They can't all get selected. It's very competitive because in addition, if you get accepted, you get a ticket to radio. You get to attend. So everybody really wants to do that. >> Talk about the organic nature. 'Cause this is one of the things that I've seen that's been part of a world-class organization. Like Amazon has their own process for it called the big idea. They have certain working documents that process to foster any idea across the organization. How important is that as part of Radio? I mean literally it's anyone right? >> Well it's not just Radio. It's important to the whole company. So I think of this as when you're working on innovation, you're gonna have sort of a breadth component. You want everybody doing a little. And some of that's gonna be incremental. One thing I learned in a prior role at a different company is you know if you add up a lot of two percenters, that's how you can double things and keep on Moore's law every year. So you're gonna get some of that. And you're gonna get some really disruptive ideas. So you know, from a top-down point of view, we try to drive some disruptions. Some disruptions show up organically from the troops. And a ton of that breadth stuff shows up. >> I'm honored to be here. It's the 14th year, and some T-shirts commemorating the key milestones from way back in the day. This is the first year press was allowed in. I noticed a handful of folks came in to kind of document this. A lot of the brightest minds in VMware here. Again, great to have us. We're super excited. But share with us. Like, what's happened over the years. Give some examples of where people were coming together, where there's a collision of ideas, and just that combustion that happens. Can you share some stories around key notable, or potentially as Raghu pointed out, there's been some misses too. (laughing) >> Yeah, you're gonna get some of that. I mean you've gotta take risks. Not everything's gonna work. You know and just to speak to misses. What I've learned in the innovation and research space is as much as anything, it's about timing. It's pretty rare that you completely technically miss. Usually engineers have an idea. They'll figure out a way to make it happen. Then the question is, is it the right time? Are the customers ready? Is the market ready to go in that direction? So, that's just to talk to that. >> Timing's everything. >> Timing is a big deal. >> Well there's never a miss too in R&D because if you, like Pat Yelson said, understand when it's gotta be re-casted. Know if it works or not. >> Yeah just understanding. So those are the ones actually you know I feel, what I really hate is if for some reason we have to end a project and we haven't actually gotten to the bottom of it. And so you don't know yes or no. And sometimes that can be the kind of time's run out, right. You've decided well, even if it works, it's too late. But you know, getting back to some of the examples, I'll focus on some more recent ones. We had some really interesting work come together on containers. And there were some folks that, and this is going back like four years ago. Containers aren't a new story, and certainly not for VMware. But around four years ago, there was a proposal at Radio that had to do with hey let's make containers a first class citizen on VMware's platform. Okay, so top level that makes great sense. Let's go do it. Containers are great for developers. The IT folks still want the isolation they get form VMs. Let's put these together really effectively. So that was top level. There was a next level, the idea that said gee at Radio, a couple years before, there'd been this idea of being able to do something called VM fork, or being able to clone a VM. And saying you know... And this came out of our end user computing group, the VDI folks. And if you think about it, if you've got a virtualized PC, you want to be able to clone that so you can start these up really fast. And the container folks said hey, we've got the same problem. Could we actually try to make use of that technology and use that as part of our bigger container push? So you know, those are examples of things that came together at Radio. And there are also examples of things where the market timing may not have quite been there. So we went out with the container work. That was actually post-Radio. It was funded. We incubated it. You've got vSphere Integrated Containers hit the market exactly the right time. >> Timing right there. >> Right, timing right there. But what we learned as we actually started doing trials with customers was that they didn't actually need the instant clone on the containers. What they needed is throughput. They wanted to know that they could do large numbers per second as opposed to you'll get that container really quickly. So as the team went along, they actually shifted away from that fork idea. We'll probably come back to it when the time's right for it. >> Well you have a nice little positioning there. I like the timing. 'Cause by the way, entrepreneurial timing is the same way. You go outside... >> I was a VC. (laughing) >> Okay, so you know okay. Timing's everything. How many times you seen that entrepreneur wicked early on it going... And they keep scratching that itch and finally they get it. The art of the timing. But also the art of knowing when to, what to keep in inventory. Pat mentioned vCloud Air as an interesting example. Recognizing abandonment there. Okay hey, let's just stop, take pause. Let's use what we have. >> Do something else. >> Do something else. >> Gotta do something else. And by the way along the way, in parallel with vCloud Air, we had built up these vCloud partners. And that's phenomenal right. So we have you know, people think in terms of a couple of very large public clouds. But we've got literally thousands of people running public clouds in either specialized markets, or particular countries, that are running on our platform. And you know that whole vCloud Air effort helped push that forward. >> So where were you a VC? Just curious. >> I was actually in a company that fits with sort of my role in research and innovation. I was in a specialized firm, boutique firm, new venture partners, that specialized in spin outs from large companies. This goes to the timing, right. I'd previously been at another large company. You know, and whenever you have a research portfolio, you're gonna have some projects that you started. They were technically successful. That's your first notch. Then you go look and say hey, can I find a business model for it. Some of these are both technically successful. You find a business model, but you had anticipated that the company strategically was gonna zig. The company zagged. Now this is a great opportunity that doesn't quite fit. So you know, we did those as spin outs. >> Well I love the perspective too of you said earlier, David, around not getting to the bottom of it. And that's the most frustrating part. Because you just gotta get some closure you know. Like okay, this thing, we took it to the end, completion, this is not gonna... Good try guys. >> And we know why. >> And you know why. Now let's take it to the next level. Now the market we're living in now I heard with Ray O'Farrell, I was talking with earlier. We talked about the confluence of these big markets coming together. Infrastructure market, which is kinda declining on paper. But cloud is filling the void. Big data's becoming AI, and blockchain over the top. These are four major markets. And at the center of them, intersecting all these nuances, security, data, IoT. >> Governance. >> Governance. So there's some sticky areas that are evolving based upon these moving markets. Opportunity recognition's another one. So this is what you're kind of doing now with the research. Talk about opportunity recognition. >> We definitely do that. And I do want to say on the infrastructure side, you know something to recall is that as people, you know they've got their private clouds. Those are individually getting actually bigger as they consolidate. But now with IoT, you're seeing edge computing pop up. Right, so the private infrastructure doesn't go away, it moves around. It's like a liquid. And you pour it from place to place in some sense. >> Moving computer around. Sound like what Ray O'Farrell was talking about in his keynote, early days of VMware. Again, Compute's the center of this. >> Right, Compute, but you know I'm a networking guy so you know, we've grown that. And I think that in fact, you know more and more as we make progress with software defined network, and network virtualization. And if you think about that, so you know let's look at that. So Compute's definitely at the center of what happens in the data center, in the cloud, right. You're gonna want to be able to string those piece together. So today we've got AirWatch. I think that's strategically really key. Because it gives us a little bit of presence on the edge devices that touch people. That's one of the ways information gets from the physical world to the virtual world is through people. >> It's an edge device. People are things too. >> IoT, right. So we're you know, working hard. And that's one of the projects that we incubated, and researched, and is now become a business at Vmware. It's to get that presence right at the edge of the gateways that bridge between the things that are connected to the physical world, and bringing it into the virtual world. Now if we can put our software defined network between all that, so you got it between the public cloud, the private cloud, the mobile devices in people's hands. >> And on premise, data center. >> Exactly, all of 'em. >> All right, so here's a question for you. This is one of those trick questions. Is the cell phone an edge device or an IoT device? >> Well I think it's in many ways both. And what I think of it is is more of a gateway. If you think about the IoT world, you have the things. >> IoT is a strict definition though in your mind, right. People refer to IoT as more of a sensor thing to a physical device. >> I tend to think of it as it's got some connection to some physical device. It's able to bring information in from the physical world. Okay, so now you look at your cell phone. It can bring information. It's got that microphone. It's got that camera, right. It can bring information in. >> [John] Connect it to a physical person. >> It can put information back out. Yeah, through a physical person. I've been in the space for a long time. Going back to my time at DARPA, we set out to create the IoT world. This wasn't an accident, right. We looked at this and said, okay the main way information gets between these two worlds today is through human beings. The way I used to explain this to the generals is you know, we can't keep putting human beings in the direct line of fire of information technology. So we've gotta get these devices, gotta get all these sensors. It's taken a long time. This is you know again, timing. But if you look at the research world. >> By the way, incredible work you've done by the way from there to here, it's been amazing. >> You know pull this along. But you know so when you look at that cell phone, it's got some of those sensors. It's got actually a whole pile of sensors in the phones today. It's got actuation, the ability to put the information back out. It's also a gateway. Because typically you know, particularly through its Bluetooth functionality, and as we get Bluetooth low power now. So it's also acting as a gateway to connect up other devices around your body, network etc. >> Personal networking, whatever comes on your physical presence. >> So you know, turn that around and it says in the IoT world, we've gotta manage gateways. We've gotta make sure gateways stay secure. Because they're really gonna be the sort of main perimeter, the line of defense. If you think about all these things that are gonna be out there, as an industry, we're gonna collectively try very hard to secure all those things. But let's be realistic. They're gonna be supplied from a wide variety of companies, and they're gonna last longer than people might think. >> How much of those devices are operationally, operation technology is non IP, versus not IP. Internet Protocol. >> Non Internet Protocol. Yeah, yeah. >> Internet Protocol now. >> [David] Non Internet, you had it right. >> Got the VC in the brain there. The VC, IP, I'm like get that IP right. So internet protocol devices, which has some challenges but that's getting fixed, versus OT just sensors proprietary. >> Yeah well either proprietary or let's say, you know it may be an industry standard, but an industrial standard. So today, a very large fraction, particularly you asked about how we focused at Vmware. Well one of our foci is we're about what are our enterprise customers gonna need. So when we think IoT, we're not really thinking that much about the consumer devices. We're thinking about those enterprise devices. So a lot of those will use... >> That's where AirWatch might come in. So employees still have phones though. >> Employees still have phones. So that's why I said, so there's the human interface. We want to be there. And there's the other enterprise interfaces to all these sensors. That could be in a factory. It could be in a smart city, any number of places. So as we pull information in from those, we're gonna find that they come from a lot of different suppliers and they're gonna last a long time. You know, even if you buy a device that's got a three to four year lifetime, probably 10 to 20% of those still gonna be around 10 years later, right. You're smiling because you know that in your home you have some wifi connected devices that are a little older than they probably should be. >> And they have full processing capability threaded processes on it, which could be running malware as we speak. >> So as I said, as an industry, we'll try to secure those really edge things. But the reality is we're gonna have to draw the line at the gateway. >> It's a lot more security work. I totally hear you. I mean the light bulb could have a full thread on there. The surface area is so huge now. >> And there have been attacks on light bulbs. >> Yeah I know. So I gotta ask you a question. 'Cause you bring up this networking edge, which by the way I love anything that's network. 'Cause I think this is the future of work. How is the future of work impacting some of the R&D you're doing. Because you talked about AirWatch them having more mobility. The human impact, society, whether it's mission driven and or just human collaboration going digital. You're gonna need to have policies. You need to have a networked society. This is super relevant. But it brings back that future work. >> It does. And so couple different aspects. You know, one you know, which just relates to a point you raised is if you look at something like our Workspace ONE product, if you've had a chance to do that. It's kind of a win win, because you get one portal. So you know, an employee for an enterprise, they've got one portal. They get access, it doesn't matter whether they're getting to a web app, they're getting to a you know, a DVI supported application. They're getting to something that's on a server, something on a SAS player, right. They get through that portal. So for them it's convenient. I mean for me as a manager, I love this, right. Because whether I'm on my cell phone, I'm on a laptop, doesn't matter, I can get to the same expense app. I can approve things. >> You don't need to carry two phones. My work phone and my... >> And I can do all these approvals really easily, right. So I also don't worry. I don't see the difference between which device I'm on. At the same time that you're delivering that convenience to the user, you're delivering governance because the IT team can be deciding how that portal's populated, how things are connected, right, and how the wiring works. All the authorization, you've got a common identification system and all of that. So that's kind of very specific to you know, let's say near term changing the user interface. In terms of the broader future of work, clearly machine learning is the big story here, right. And I think that what we're gonna see is, particularly again in enterprise, more and more need for data analysts to be able to look at the big data. We're gonna see sort of more and more use of machine-learning technologies. It's gonna you know basically creep in everywhere. And we're getting this at just the right time. So if you want to think about future work in the big national and international scale, what you really sort of stop to look at is say, gee, okay, these machines are gonna do all this work. What about the people? And you know a lot of people therefore get concerned. Gee, the computers are gonna take away all the jobs. Right, you get these sound bytes. >> I think right now we're worried about fake news and real content. (laughing) >> Well let's come back to that one later. But there is a sense of gee, you know, the computers will take on all the jobs. And you know what I think people are not doing carefully is looking at the demographics. Because if you look at basically all the developed economies for practical purposes, we actually have a demographic problem. Our problem is actually not a surplus of workers. It's gonna be a shortage of workers. In fact, actually in the US right now, you're starting to feel this. Now that's at the peak of the economic cycle. So of course you feel it, you know, a bit. >> They need trained workers too. Also people who qualify. >> Right. So I think the thing we really need to look at is how do we do a much better job at matching, you know, sort of workers, both folks coming into the workplace, people with existing skills, to available opportunities. Because actually we're gonna have a shortage of workers. And it's not just sort of the US and Europe. I mean China, Japan. Well Japan for a long time. China, headed to a shortage of workers. I was out in Singapore not too long ago and was surprised to find out not just that they're concerned. But they went and looked at the Southeast Asian countries around them that are their markets. They're looking at a shortage of workers. So you know, if we didn't have something like machine-learning and AI coming along, we'd be sitting there saying, how are we gonna keep our economies growing? >> We need augmentation for sure. >> We need this augmentation. And it's coming at just, you know, you talked about timing. You know, it's coming at just the right time. Now, there definitely are gonna be some tough transitions along the way, right. So we definitely, you know, for example, as autonomous vehicles come along, we've gotta figure out, okay, all those people that are driving vehicles, what are they gonna do going forward? But let's not kid ourselves too, you know. If you've got trucks moving around with high-value cargoes, you're not gonna leave those unattended, right. We're gonna have to figure all this out. So there's gonna be a lot of interesting opportunities. >> What's your take on blockchain? Well first of all, GDPR, real quick. Train wreck, useful? >> I think it's you know, if you backed up and asked me four or five years ago, I'd have said train wreck. And largely because we still don't have the sort of kind of international consensus on what the rules should be. >> But you mentioned governance earlier. That certainly needs to be at the center of the action. >> Right, but you know, if we take a look now, it seems like it's showing up at just the right time, right. You know, in that sense. I think part of what's happened is over the intervening years, a lot of countries outside of Europe, because they realize these regulations would apply to them, they've worked with European regulators to help the regulators understand the technology, you know, help the companies understand. >> That's a good politically correct answer. I'll just say I think it's a shit-show personally. But you know. I mean it's gonna force people... It's like Y2K in money making, but Y2 never happened. It's forcing people to really, I think the value of GDPR is the big companies are gonna get hit hard on some suits. Just the trolling thing bothers me. Just the trolls that come out of the woodwork. But I think the positive that puts the center of the value proposition, making data, not a one off, like backup and recovery. It has to be core to technical operations. >> And making privacy something that's really in that first class category. You know, as I said. >> Great first step, but... There's a big but. >> There is more to be done. >> Hopefully they don't go after us little guys. All right, final question, blockchain. We are super excited about blockchain. You have teams working on this. >> [David] I am super excited about blockchain. >> Talk about your view on blockchain. Why are you excited about it? Obviously we feel it's very efficient, makes inefficiencies efficient across all industries. Your thoughts. >> Okay so again, we look at things through this prism. What are enterprise customers gonna be looking at? What do they want? And you know, so we're not you know... I think you're in the same place. We're not looking at the crypto currencies, right. That's not the thing. And in fact, we're not even looking at cohabiting on the Bitcoin blockchain. Because do you really want to run your business in the same place that a whole bunch of other people are running illegal businesses and the whole thing. >> And by the way, there's some technical issues. (laughing) >> We'll get to that. We're gonna get there. But just even as a starting point. So we pretty quickly looking even you know, three, four years ago said, okay enterprise is not gonna want to go that way. But this idea of a federated ledger, right. So if you can make federated ledgers and we can have reusable technology, that means now, if I want to federate with other companies or other organizations, or you know, or you need companies federating with governments, or governments federating with each other. Anywhere you want to pull together essentially a club for the exchange of data, with a persistent record of what happened, you've now got a common way of doing it, right. Or we can drive towards that. You know there'll be a standardization process to get there. But so it's not to me, federated ledgers means lowering the barrier to federation. And I think that's pretty exciting. Whole bunch of places. You know, supply chain, clearly one. Financial technology, but... >> David, we gotta spend some time, have you come in the studio. I'd love to explore some of these great topics with you. But I gotta ask you one final question. You know, with your history going back to ARPA, D-ARPA days, and looking at really the beginning of the information super highway, IP, connecting some universities together, to today, the waves that have gone through. We've talked about standards. The OSI stack, you had all these grandiose standard plans. Not all of them have happened exactly as planned. But defacto standards play a really important role. It galvanizes community, gives people guiding principles, a north star, whatever metaphor you want to use. The key is the enabling disrupting technologies, a defacto standard. What's happening now in your mind that you see out there that's starting to emerge as defacto? 'Cause certainly there's a lot of standard things going, open sources for tier one citizen growing, rapidly, which is greatness. Cloud is booming, unlimited resources, Compute, fingertip compute... All this is good. >> Yeah. >> All these new standards, I got Kubernetes, I got this going on, what's emerging? >> Well again, they're defacto, right. Kubernetes is an interesting example of basically open source meets defacto. And that's pretty exciting right. I mean, we're excited about it. I think people are often surprised we're a fan of open source. And I guess really, I just like to sort of back up a notch. Because you know what you touched on is defacto standards, whether it's open source or not, have suddenly become a lot easier. When I say suddenly, over like a 10 year period. And I think what's going on there is this is part of the change to software. So you know, if you're talking about hardware, and you got screws, you know, and you got threads, these physical things have to match, and they have to match exactly, right. Say when you travel overseas, you need to carry converters, physical converters to convert from one thing to another. So if you want to interoperate, if you and I want to have stuff that interoperates, we needed to build like either, do the same thing, or have a physical adapter. There was a cost to not having a standard. If you think about in the software world, we can build software converters, right. So if I've got you know, say we've got two, or three, or four, or even 50 defacto standards in the software world. You know, blockchain. So there's 50 new things. Everybody launches their own. Pretty quickly, the market will drive that down to a small number. And then you can put software converters in place. So we no longer actually have to get to one. >> [John] That's the software economic model. >> It's a big change. >> And that is huge. So by the way, we had Dirk Hohndel on at CubeCon. Love his open source mission, just a shout out to you guys, doing a great job. You guys at VMware certainly that we know, love you over on the East Coast. Final prediction. Final question. Give us a prediction. >> Give you a prediction. >> 2018, second half of the year, what's gonna happen? What's gonna be a notable thing that you see out on the horizon that might happen in the marketplace that might be notable for people to stand up and pay attention to? >> I think we're gonna see some significant developments in the blockchain space. And it's gonna be in the category of people starting to announce real deployments. And you know, if you're sort of looking at that time frame, you know you've had a lot of different enterprises try things. We've had people kind of dabble at things. I think you're gonna start seeing some people really move significantly in that space. >> And do you think like, just to follow up on that, do you think like in the database world now, where by the way, it's okay to have a zillion databases now. 'Cause you talk about databases. >> But it consolidated down to a few players. >> You get some extraction layers. It's okay to have a few variety of blockchains. I mean, there's no one blockchain. >> Correct, so that's where I think as I said, you're gonna see actually a bunch of these deployments. They'll be using different technologies. And then the fun really starts right. As people consolidate, especially with open source, they swap ideas. We boil it down to what's the best of the best. We've got you know, stuff we're doing certainly to knock the throughput down, sorry throughput up, latency down. (John laughing) And you know, we think we've got a very scalable approach. And most important, you know something that's really... I don't know if you talked to people about our sustainability. You know, it's a key value for VMware. >> [John] Yeah, lot of great standards there, yeah. >> So you can imagine we looked at blockchain. We looked at proof of work. And we said that's proof of energy wasted. We're not going there. >> Gotta make it more efficient. >> I think you're gonna see more and more folks focusing on things like Byzantine fault tolerant. Ours is scalable. You know SBFT. >> Yeah performance is key. And the energy's a huge problem. >> But performance and at acceptable energy. You can't you know, just waste. It's immoral to just waste energy. And it really goes against what a lot of the whole IT industry's built up. You know, I think we've, over the decades, we've done a lot of things for the good of society. And we gotta stay the mission. >> I think as the more, I won't say mature, but big world-class organizations join in, I think that'll straighten itself out. And certainly, as any evolution would see, the web. I remember dial-up and AOL. It can't go as fast as this minicomputer. Well you don't get it, it's the web okay. David, thanks so much for coming on, appreciate it. Great conversation here at Radio 2018. I'm John Furrier, Cube coverage of VMware's annual 14th year conference, at Radio 2018. Thanks for watching. (upbeat techno music)

>> Announcer: Live from Las Vegas, it's theCUBE. Covering Dell Technologies World 2018. Brought to you by Dell EMC and its ecosystem partners. >> Welcome back, it's a beautiful day here in Las Vegas and this is theCUBE's live coverage of Dell Technologies World 2018. I'm Stu Miniman and happy to welcome, fresh off the keynote stage and for the first time on our program Jeff Clark, who is the Vice-Chairman of Products and Operations at Dell Technologies. Jeff, great to see you Thanks for joining us. >> Thanks, Stu. Thanks for having me. >> All right, so first of all Jeff, you know, you'll be a CUBE alum when we finish this, so for our audience that's not familiar-- >> Jeff: Do I get a badge? >> I've got a sticker for you actually. >> A sticker will work. >> Absolutely. Tell us a little bit about your background, you've been at Dell for a number of years. You now own really kind of the client and ISG businesses. >> Jeff: Sure. >> Which is a huge chunk of Michael's business. Give us your background. >> I'm an electrical engineer, by training. I went to the University of Texas at San Antonio. Got my double E degree. Out of school went to work for Motorola. And I joined what was PC's Limited when that was the first private name of Dell in 1987. I've been here for 31 years. And I've done a variety of things all on the engineering and product side. I've had the fortunate opportunity, I started in the factory as a process/test/quality/reliability engineer, we were Jacks of many trades at that time. Went to product development in 1989 and have been in that side ever since. I've worked in every kind of product that we had at the core design roles. I got to start a business, one of the funnest things I've ever done. I started the Precision business in 1997 from ground zero, me and a few of our top engineers and building that into the business that it is today. Expanded responsibilities, had a stint of running our enterprise business back in 2002 through 2005. Actually got to work with EMC back then. Dave Donatelli and many others back in the day. And now I lead a combined products and operations organization that has our CSG PC peripheral portfolio and ISG portfolio, our infrastructure products, as well as the fundamental supply chain that runs the company. >> Yeah, so Jeff, you've done it all and you've seen Michael through well, an amazing journey. >> We've worked together for a long time and it's been a heck of a ride. And to be honest, I think the ride's not over and the ride in front of us I think is more exciting than the past 30 years. >> Yeah, as we always say, it's a good thing, nothing's changing. There's nothing new to get those that love technology excited about, right? >> If there's any constant in our industry, and certainly in our company, it is change. And thinking about what's unfolded in my three plus decades at this is amazing to where we are today. But again, the future, as Bob DeCrescenzo said today, wicked cool. >> Wicked cool, absolutely. When you get up to Boston a little bit more, you can get a Boston accent. Yeah, exactly. Jeff, if we look at the Dell Technologies family, client side of the business is about half, the ISG is another 37%, so you know, you own major, major chunk of what's going on inside. Maybe give us a little bit of how you look at this portfolio. Are there interactions between the client side and the enterprise side? You know, we've seen most of the other big tech players that had both, either shed or split or, you know, kept the HPs and the IBMs of the world, no longer have both of those together. >> Yeah, those are interesting thoughts. You know, for us, our customers are asking us to provide a more set of comprehensive solutions. They want more end to end. And I don't see how you provide an end to end solution if you don't have one of the ends. And as trite as that may sound, I think it's the core fabric of what we're doing and certainly the role I have now leading this organization of being able to cultivate and build, I think, the world's leading and innovative PC products and peripherals around them. Same thing on the infrastructure side, where we have the privilege of being a leader in a number of categories. And then beginning to bring them together in new and unique ways. I referenced in my keynote this morning about how new entrants to the workforce are pressuring conventional definitions of how we do work and we deploy technology. So we have leadership, products, and now you capture or able to tie that together with VMware Workspace ONE or an AirWatch or RSA class of products and you begin to modernize the experience. How could you not do that if you're not integrating the pieces? Or a VDI experience where you take a thin client, or VxRail infrastructure, and some VMware Horizon software and build out a solution set. That's what our customers are asking us to do. And I think we're in a very unique position. In fact, I know we are, 'cause no one else has all of what I just described. >> Jeff, there was a main theme you talked about in your keynote, that IT can drive and change business and it resonated from what I'm hearing with customers. But if you dial back a few years ago, it was IT wasn't getting it done, IT wasn't listening to the business, we had Stealth IT. Why are things different now? What's the role of IT going forward? And how does Dell fit into that big picture? >> You know, Michael touched on it in his opening yesterday about IT and business have become much much more closely integrated to compete in this modern world. And I suspect some of this goes back to we've always thought of IT as a cost center, OPEX. Yet, over the past decade, we've seen some fundamental disruption of business that has been fundamentally IT-led. New technology-led. New business models that have been fueled by new technology. I think that modernization, whether it's modernization of applications, taking advantage of information at your disposal and turning that into useful insights to make better business decisions, is a catalyst for a reframing, if you will, of what IT does. And the role of IT in a business, and a role that IT can help companies be more competitive, or at a minimum, help them not get disrupted by someone who's doing it, as well. So I think that's what's changing and I think you're seeing companies embrace that. And as soon as you do, you begin to I think challenge what have you invested in, where are you going, how am I taking advantage of some of the new trends that I outlined maybe this morning. And it gets I think a pretty interesting time in front of us. >> Yeah, you know, you actually went through immersive and collaborative computing, IOT, multi-clouded options, offer to find anything and AI and ML. So a lot of new things. One area I'd like to touch on, we heard some great side from Allison Dew earlier this week. It's great when we have the new tools and the new technology but sometimes we wonder how does adoption go and how does that impact productivity and people's engagement? And I'm curious how we help the enterprise and help the client side, not just do something new but be more productive and move their business forward. >> Look, if start with the client side, I think it's pretty easy to think about productivity. Particularly if you believe this boundary between work and the workplace is fundamentally changed and think about where people do work. You're actually getting a much more productive workforce by allowing people to work when the want to work, where they want to work. And that traditional boundary of eight to five, whatever it might be, physically in the office. You now have access to all 168 hours in a week and people want to work when they want to work. And we find that the work more, particularly if you put technology in their hand that makes them more productive and they have access to what they need to do their job. You cast that forward into the enterprise and I think, look, at some level IT is hard and we have a huge role in making it much easier. How to simplify. How to make it more automated so IT practitioners can actually migrate to how do I configure this LAN? How do I set up this server? And interesting things and still important things, but can migrate to how do I take this data and turn it into information that helps my business unit, my company win. That's where I think, again, I think this migrates, too and we play a huge role in helping that. >> Yeah, there's a theme that, another thing came up in the keynote, data really at the center of everything and not just talking about storage, but you had McClaren up on stage talking about that. How do you see the role of data changing? How do we capture for companies? How valued data is? >> A tie back to Michael's opening, he talked about data being, if you will, the rocket fuel for this rocket change and digitization of our world, the digital transformation that's underway. And between Michael, Pat, and myself, we all talked about that happening at the edge in a decentralized manner. I tried to build upon that and say you hadn't seen nothing yet, there's a whole lot more coming. Well, if believe that, you have to start preparing today, and anticipating that. And again, I think we play a role in helping companies do that. I think it requires a modern approach. It requires an approach to understand how that information is coming in to be able to do something with it. That's where we're focusing, as I mentioned. In fact, I think I specifically said it's sort of the heart of our vision for IT transformation. The data's the gold. In fact, Pat may have said that yesterday. Now, the challenge will be how do you take all of that data sort through it, figure out which pieces are most valuable and then get them to where they're supposed to go to make decisions. That's yet to be seen how we do that but I'm encouraged, given our track record in this industry. We'll find ways to do that. Engines like AI and machine or capabilities like artificial intelligence and machine learning are certainly a vast step forward of making sense of all that stuff. >> Yeah. Jeff, I wonder if you could bring us inside some of your customers. You know, where do you find some of the strategic discussions happening? I think back to early PC or server days, you know, who bought boxes versus now, it seems like more of a C level discussion for some of these large trends that you're seeing. What are some of the big changes that you're seeing in the customers and what are some of the biggest challenges that they're having today? >> I think you mentioned it. One of the things that I've seen in the customer interactions I've had in this new role and getting to see more and more each and every month. The conversations I have, or participate in, are seldom, if ever, about the speeds and feeds of this, the performance of that. It's about here's my business problem, how do you help me? How do you help me get this done? How do you provide me a set of solutions to get to where I want to go? By the way, if you have advice, recommendation to help us, they want to hear that. So they want to access our technical knowledge base across our organization. But again, I think this theme that I tried to say a couple of times this morning around outcomes, so it's an outcome-driven discussion. It's solutions. It's end to end. And how can you help me? Probably, I guess, I could generalize them to fit those four attributes. >> Great. Last thing, you talked about the modern data center. What's that mean for your customers? >> To me, it's all about putting at the disposal of our customers a set of technologies and infrastructure solutions and services that allows 'em to take advantage of that data. Allow them to have the data services they need and the underlying horsepower to do it in a fairly intelligent way. Hopefully automating a few of those tasks and giving them the agility and flexibility they need. >> Yeah. Jeff, wonder if you could speak to really, the engineering culture inside of Dell. Think back to before Dell made a lot of exhibitions, it's like, oh well Dell was a supply chain company, people would say. And then a number of acquisitions came through, you know, you lived with a lot of the engineers, you've got more engineers through the EMC merger. Sometimes people that don't understand, they're like oh, it's just all going to commodity stuff, software defined anything means that infrastructure doesn't matter. You know, where does the Dell engineering culture differentiate and position you in the market? >> You know, it might not surprise you, given my background, that certainly we are a supply chain company. We were doing hardcore engineering for a long time. I look at some of the advancements we made back in the day in leading the industry. I think we have a long distinguished track record of doing that. And now with the combination of the two companies, I look at this organization and the engineering capability we have, I like my hand, we like our hand. The trick is, is to getting our teams to innovate where we can differentiate, where we can help customers solve problems. And part of what I've been doing across this community of engineers, is doing that. Pivoting resources to the most important things. Pivoting resources to where we can differentiate. Pivoting resources where our innovation can actually distinguish, or shine against the competitive set. We've seen this in every category, PC, server, storage. And many of these cases, we start from the privileged position of being the leader. So think about when we get everything aligned to be able to innovate and differentiate, I like my hand. >> All right. Jeff, I want to give you the final word, coming away from Dell Technologies World this year. There's a lot of product announcements, people are going to learn a lot in the sessions, but what do you want people to come away with? Understanding the Dell portfolio and Dell as a company, as a partner? >> Well, if I could leave any parting statement, and make it very specific to the ISG portfolio, I talked about power, our power brand now being the brand of our future state ISG products, walk away with a commitment to build a power branded portfolio that is going to be innovative, differentiated in the marketplace, and something that helps our customers with. That's our commitment and that's what we'll deliver going forward. >> All right. Jeff Clark, thank you for sharing with us all the information, your update. Your first time on theCUBE, but I'm sure we'll have you on many times in the future. >> My pleasure, thanks for having me. >> All right. We'll be back with lots more coverage here from Dell Technologies World 2018. I'm Stu Miniman and you're watching theCUBE.

>> Narrator: Live from Las Vegas it's theCube covering AWS reInvent 2017 presented by AWS, Intel and our ecosystem of partners. >> Hello and welcome to theCube's exclusive coverage here in Las Vegas for AWS, Amazon Web Services reinvent 2017, 45,000 people. It's theCube's fifth year in covering AWS, five years ago I think 7,000 people attended, this year close to 45,000, developers and industry participants. And of course this is theCube I'm John Furrier with my co-host Keith Townsend and we're excited to have Cube alumni Sanjay Poonen who's the chief operating officer for VMware. Sanjay great to see you, of course a good friend with Andy Jassy, you went to Harvard Business School together, both Mavericks, welcome to theCube. >> Thank you and you know what I loved about the keynote this morning? Andy and I both love music. And he had all these musical stuff man. He had Tom Petty, he had Eric Clapton. I an not sure I like all of his picks but at least those two, loved it man. >> The music thing really speaks to the artists, artists inside of this industry. >> Yes. >> And we were talking on theCube earlier that, we're in a time now where and I think Tom Siebel said it when he was on, that there's going to be a mass, just extinction of companies that don't make it on the digital transformation and he cited some. You're at VMware you guys are transforming and continue to do well, you've a relationship with Amazon Web Services, talk about the challenge that's in front of business executives right now around this transformation because possibly looking at extinction for some big brands potentially big companies in IT. >> It's interesting that Tom Siebel would say that in terms of where Siebel ended up and where salespersons now I respect him, he's obviously doing good things at C3. But listen that's I think what every company has got to ask itself, how do you build longevity? How do you make yourself sustainable? Next year will be our 20 year anniversary of VMware's founding. The story could have been written about VMware that you were the last good company and then you were a legacy company because you were relevant to yesterday's part of the world which was the data center. And I think the key thing that kept us awake the last two or three years was how do you make them relevant to the other side of history which is the public cloud? What we've really been able to do over the last two or three years is build a story of the company that's not just relevant to the data center and private cloud, which is not going away guys as you know but build a bridge into the public cloud and this partnership has been a key part of that and then of course the third part of that is our end user computing story. So I think cloud mobile security have become the pillars of the new VMware and we're very excited about that and this show, I mean if you combine the momentum of this show and VMworld, collectively at VMworld we have probably about 70, 80,000 people who come to VMworld and Vforums, there's 45,000 people here with all the other summits, there's probably have another 40,000 people, this is collectively about a 100, 150,000 people are coming to the largest infrastructure shows on the planet great momentum. >> And as an infrastructure show that's turning into a developer show line get your thoughts and I want to just clarify something 'cause we pointed this out at VMworld this year because it's pretty obvious what happened. The announcement that you guys did that Ragu and your team did with Ragu with AWS was instrumental. The proof was at VMworld where you saw clarity in the messaging. Everyone can see what's going on. I now know what's happening, my operations are gonna be secure, I can run VSphere on the cloud or on Prem, everything could be called what it is. But the reality was is that you guys have the operators, IT operations and Amazon has a robust cloud native developer community, not that they're conflicting in any way, they're coming together so it was a smart move so I got to ask you, as you guys continue your relationship with AWS, how are you guys tying the new ops role, ops teams with the dev teams because with IoT, this is where it's coming together you can see it right there? Your thoughts? >> I mean listen, the partnership is going great. I just saw Andy Jassy after his exec summit session, gave him a hug. We're very excited about it and I think of any of the technology vendors he mentioned on stage, we were on several slides there, mentioned a few times. I think we're probably one of the top tech partners of his and reality is, there's two aspects to the story. One is the developer and operations come together which you, you eloquently articulated. The other aspect is, we're the king of the private cloud and they're the king of the public cloud, when you can bring these together, you don't have to make it a choice between one or the other, we want to make sure that the private cloud is maximized to its full extent and then you build a bridge into the public cloud. I think those two factors, bringing developer and operations together and marrying the private and public cloud, what we call hybrid cloud computing, a term we coined and now of course many others-- >> I think-- >> On top of the term. Well whoever did. >> I think HP might have coined it. >> But nonetheless, we feel very good about the future about developer and operations and hybrid cloud computing being a good part of the world's future. >> Sanjay, I actually interviewed you 2016 VMworld and you said something very interesting that now I look back on it I'm like, "Oh of course." Which is that, you gave your developers the tools they needed to do their jobs which at the time included AWS before the announcement of VMware and AWS partnership. AWS doesn't change their data center for anyone so the value that obviously you guys are bringing to them and their customers speaks volumes. AWS has also said, Andy on stage says, he tries to go out and talk to customers every week. I joked that before the start of this that every LinkedIn request I get, you're already a connection of that LinkedIn request. How important is it for you to talk to your internal staff as well as your external customers to get the pulse of this operations and developer movement going and infused into the culture of VMware. >> Well Keith I appreciate the kind words. When we decided who to partner with and how to partner with them, when we had made the announcement last year, we went and talked to our customers. We're very customer and client focused as are they. And we began to hear a very proportional to the market share stats, AWS most prominently and every one of our customers were telling us the same thing that both Andy and us were asking which is "Why couldn't you get the best of both worlds? "You're making a choice." Now we had a little bit of an impediment in the sense that we had tried to build a public cloud with vCloud air but once we made the decision that we were getting out of that business, divested it, took care of those clients, the door really opened up and we started to test pulse with a couple of customers under NDA. What if you were to imagine a partnership between us and Amazon, what would you think? And man, I can tell you, a couple of these customers some of who are on stage at the time of the announcement, fell off their chair. This would be huge. This is going to be like a, one customer said it's gonna be like a Berlin Wall moment, the US and the Soviet Union getting together. I mean the momentum building up to it. So now what we've got to do, it's been a year later, we've shipped, released, the momentum still is pretty high there, we've gotta now start to really make this actionable, get customers excited. Most of my meetings here have been with customers. System integrators that came from one of the largest SIs in the world. They're seeing this as a big part of the momentum. Our booth here is pretty crowded. We've got to make sure now that the customers can start realizing the value of VMware and AWS as a build. The other thing that as you mentioned that both sides did very explicitly in the design of this was to ensure that each other's engineering teams were closely embedded. So it's almost like having an engineering team of VMware embedded inside Amazon and an engineering team of Amazon embedded inside VMware. That's how closely we work together. Never done before in the history of both companies. I don't think they've ever done it with anybody else, certainly the level of trying. That represents the trust we had with each other. >> Sanjay, I gotta ask you, we were talking with some folks last night, I was saying that you were coming on theCube and I said, "What should I ask Sanjay? "I want to get him a zinger, "I want to get him off as messaging." Hard to do but we'll try. They said, "Ask him about security." So I gotta ask you, because security has been Amazon's kryptonite for many years. They've done the work in the public sector, they've done the work in the cloud with security and it's paying off for them. Security still needs to get solved. It's a solvable problem. What is your stance on security now that you got the private and hybrid going on with the public? Anything change? I know you got the AirWatch, you're proud of that but what else is going on? >> I think quietly, VMware has become one of the prominent brands that have been talked about in security. We had a CIO survey that I saw recently in network security where increasingly, customers are talking about VMware because of NSX. When I go to the AirWatch conference I look at the business cards of people and they're all in the security domain of endpoint security. What we're finding is that, security requires a new view of it where, it can't be 6000 vendors. It feels like a strip mall where every little shop has got its boutique little thing that you ought to buy and when you buy a car you expect a lot of the things to be solved in the core aspects of the car as opposed to buying a lot of add-ons. So our point of view first off is that security needs to baked into the infrastructure, and we're gonna do that. With products like NSX that bake it into the data center, with products like AirWatch and Workspace ONE that bake it into the endpoint and with products like App Defence that even take it deeper into the core of the hypervisor. Given that we've begun to also really focus our education of customers on higher level terms, I was talking to a CIO yesterday who was educating his board on what are some of the key things in cyber security they need to worry about. And the CIO said this to me, the magic word that he is training all of his board members on, is segmentation. Micro segmentation segmentation is a very simple concept that NSX sort of pioneered. We'll finding that now to become very relevant. Same-- >> So that's paying off? >> Paying up big time. WannaCry and Petya taught us that, patching probably is a very important aspect of what people need to do. Encryption, you could argue a lot of what happened in the Equifax may have been mitigated if the data been encrypted. Identity, multi-factor authentication. We're seeing a couple of these key things being hygiene that we can educate people better on in security, it really is becoming a key part to our stories now. >> And you consider yourself top-tier security provider-- >> We are part of an ecosystem but our point of view in security now is very well informed in helping people on the data center to the endpoint to the cloud and helping them with some of these key areas. And because we're so customer focused, we don't come in at this from the way a traditional security players providing access to and we don't necessarily have a brand there but increasingly we're finding with the success of NSX, Workspace ONE and the introduction of new products like App Defense, we're building a point of security that's highly differentiated and unique. >> Sanjay big acquisition in SD-WAN space. Tell us how does that high stress security player and this acquisition in SD-WAN, the edge, the cloud plays into VMware which is traditionally a data center company, SD-wAN, help us understand that acquisition. >> Good question. >> As we saw the data center and the cloud starting to develop that people understand pretty well. We began to also hear and see another aspect of what people were starting to see happen which was the edge and increasingly IoT is one driver of that. And our customers started to say to us, "Listen if you're driving NSX and its success "in the data center, wouldn't it be good "to also have a software-defined wide area network strategy "that allows us to take that benefit of networking, "software-defined networking to the branch, to the edge?" So increasingly we had a choice. Do we build that ourselves on top of NSX and build out an SD-WAN capability which we could have done or do we go and look at our customers? For example we went and talked to telcos like AT&T and they said the best solution out there is a company that can develop cloud. We start to talk to customers who were using them and we analyzed the space and we felt it would be much faster for us to buy rather than build a story of a software-defined networking story that goes from the data center to the branch. And VeloCloud was well-regarded, I would view this, it's early and we haven't closed the acquisition as yet but once we close this, this has all the potential to have the type of transformative effect like in AirWatch or in nai-si-ra-hat in a different way at the edge. And we think the idea of edge core which is the data center and cloud become very key aspects of where infrastructure play. And it becomes a partnership opportunity. VeloCloud will become a partnership opportunity with the telcos, with the AWSs of the world and with the traditional enterprises. >> So bring it all together for us. Data center, NSX, Edge SD-WAN, AirWatch capability, IOT, how does all of that connect together? >> You should look at IoT and Edge being kind of related topics. Data center and the core being related topics, cloud being a third and then of course the end-user landscape and the endpoint being where it is, those would be the four areas. Data center being the core of where VMware started, that's always gonna be and our stick there so to speak is that we're gonna take what was done in hardware and do it in software significantly cheaper, less complex and make a lot of money there. But then we will help people bridge into the cloud and bridge into the edge, that's the core part of our strategy. Data center first, cloud, edge. And then the end user world sits on top of all of that because every device today is either a phone, a tablet or a laptop and there's no vendor that can manage the heterogeneous landscape today of Apple devices, Google devices, Apple being iOS and Mac, Android, Chrome in the case of Google, or Windows 10 in the case of Microsoft. That heterogeneous landscape, managing and securing that which is what AirWatch and Workspace ONE does is uniquely ours. So we think this proposition of data center, cloud, edge and end-user computing, huge opportunity for VMware. >> Can we expect to see NSX as the core of that? >> Absolutely. NSX becomes to us as important as ESX was, in fact that's kind of why we like the name. It becomes the backbone and platform for everything we do that connects the data center to the cloud, it's a key part of BMC for example. It connects the data center to the edge hence what we've done with SD-WAN and it's also a key part to what connects to the end user world. When you connect network security with what we're doing with AirWatch which we announced two years ago, you get magic. We think NSX becomes a fundamental and we're only in the first or second or third inning of software-defined networking. We have a few thousand customers okay of NSX, that's a fraction of the 500,000 customers of VMware. We think we can take that in and the networking market is an 80 billion dollar market ripe for a lot of innovation. >> Sanjay, I want to get your perspective on the industry landscape. Amazon announcing results, I laid it out on my Forbes story and in Silicon Angle all the coverage, go check it out but basically is, Amazon is going so fast the developers are voting with their workloads so their cloud thing is the elastic cloud, they check, they're winning and winning. You guys own the enterprised data center operating model which is private cloud I buy that but it's all still one cloud IoT, I like that. The question is how do you explain it to the people that don't know what's going on? Share your color on what's happening here because this is a historic moment. It's a renaissance-- >> I think listen, when I'm describing this to my wife or to my mother or somebody who's not and say "There's a world of tech companies "that applies to the consumer." In fact when I look at my ticker list, I divide them on consumer and enterprise. These are companies like Apple and Google and Facebook. They may have aspirations in enterprise but they're primarily consumer companies and those are actually what most people can relate to and those are now some of the biggest market cap companies in the world. When you look at the enterprise, typically you can divide them into applications companies, companies like Salesforce, SAP and parts of Oracle and others, Workday and then companies in infrastructure which is where companies like VMware and AWS and so on fit. I think what's happening is, there's a significant shift because of the cloud to a whole new avenue of spending where every company has to think about themselves as a technology company. And the same thing's happening with mobile devices. Cloud mobile security ties many of those conversations together. And there are companies that are innovators and there companies that you described earlier John at the start of this show that's going to become extinct. >> My thesis is this, I want to get your reaction to this. I believe a software renaissance is coming and it's gonna be operated differently and you guys are already kind of telegraphing your move so if that's the case, then a whole new guard is gonna be developing, he calls it the new garden. Old guard he refers to kind of the older guards. My criticism of him was is that he put a Gartner slide up there, that is as says old guard as you get. Andy's promoting this whole new guard thing yet he puts up the Gartner Magic Quadrant for infrastructure as a service, that's irrelevant to his entire presentation, hold on, the question is about you know I'm a Gardner-- >> Before I defend him. >> They're all guard, don't defend him too fast. I know the buyers see if they trust Gartner, maybe not. The point is, what are the new metrics? We need new metrics because the cloud is horizontally scalable. It's integrated. You got software driving decision making, it's not about a category, it's about a fabric. >> I'm not here to... I'm a friend of Andy, I love what he talked about and I'm not here to defend or criticize Gartner but what I liked about his presentation was, he showed the Gartner slide probably about 20 minutes into the presentation. He started off by his metrics of revenue and number of customers. >> I get that, show momentum, Gartner gives you like the number one-- >> But the number of customers is what counts the most. The most important metric is adoption and last year he said there was about a million customers this year he said several million. And if it's true that both startups and enterprises are adopting this, adopting, I don't mean just buying, there is momentum here. Irrespective, the analysts talking about this should be, hopefully-- >> Alright so I buy the customer and I've said that on theCube before, of course and Microsoft could say, "We listen to customers too and we have a zillion customers "running Office 365." Is that really cloud or fake cloud? >> At the end of the day, at the end of the day, it's not a winner take all market to one player. I think all of these companies will be successful. They have different strategies. Microsoft's strategy is driven from Office 365 and some of what they can do in Windows into Azure. These folks have come up from the bottom up. Oracle's trying to come at it from a different angle, Google's trying to come at a different angle and the good news is, all of these companies have deep pockets and will invest. Amazon does have a head start. They are number one in the market. >> Let me rephrase it. Modern applications could be, I'll by the customer workload argument if it's defined as a modern app. Because Oracle could say I got a zillion customers too and they win on that, those numbers are pretty strong so is Microsoft. But to me the cloud is showing a new model. >> Absolutely. >> So what is in your mind good metric to saying that's a modern app, that is not. >> I think when you can look at the modern companies like the Airbnb, the Pinterest, the Slacks and whoever. Some of them are going to make a decision to do their own infrastructure. Facebook does not put their IaaS on top of AWS or Azure or Google, they built their own data is because they can afford to do and want to do it. That's their competitive advantage. But for companies who can't, if they are building their apps on these platforms that's one element. And then the traditional enterprises, they think about their evolution. If they're starting to adopt these platforms not just to migrate old applications to new ones where VMware fits in, all building new cloud native applications on there, I think that momentum is clear. When was the last time you saw a company go from zero to 18 billion in 10 years, 10, 12 years that he's been around? Or VMware or Salesforce go from zero to eight billion in the last 18 years? This phenomenon of companies like Salesforce, VMware and AWS-- >> It's all the scale guys, you gotta get to scale, you gotta have value. >> This is unprecedented in the last five to 10 years, unprecedented. These companies I believe are going to be the companies of the tech future. I'm not saying that the old guard, but if they don't change, they won't be the companies that people talk about. The phenomenon of AWS just going from zero to 18 is, I personally think-- >> And growing 40% on that baseline. >> Andy's probably one of the greatest leaders of our modern time for his role in making that happen but I think these are the companies that we watch carefully. The companies that are growing rapidly, that our customers are adopting them in the hundreds of thousands if not millions, there's true momentum there. >> So Sanjay, data has gravity, data is also the new oil. We look at what Andy has in his arsenal, all of the date of that's in S3 that he can run, all his MI and AI services against, that's some great honey for this audience. When I look at VMware, there's not much of a data strategy, there's a security the data in transit but there's not a data strategy. What does VMware's data strategy to help customers take math without oil? >> We've talked about it in terms of our data analytics what we're doing machine learning and AI. We felt this year given so much of what we had to announce around security software-defined networking, the branch, the edge, putting more of that into VMworld which is usually our big event where we announce this stuff would have just crowded our people. But we began to lay the seeds of what you'll start to hear a lot more in 2018. Not trying to make a spoiler alert for but we acquired this company Wavefront that does, next-generation cloud native metrics and analytics. Think of it as like, you did that with AppDynamics in the old world, you're doing this with Wavefront in the new world of cloud native. We have really rethought through how, all the data we collect, whether it's on the data center or in the endpoint could be mined and become a telemetry that we actually use. We bought another company Apteligent, formerly called Criticism, that's allowing us to do that type of analytics on the endpoint. You're gonna see a couple of these moves that are the breadcrumbs of what we'll start announcing a lot more of a comprehensive analytics strategy in 2018, which I think we're very exciting. I think the other thing we've been cautious to do is not AI wash, there's a lot of cloud washing and machine learning washing that happened to companies-- >> They're stopping a wave on-- >> Now it's authentic, now I think it's out there when, when Andy talks about all they're doing in AI and machine learning, there's an authenticity to it. We want to be in the same way, have a measured, careful strategy and you will absolutely hear from us a lot more. Thank you for bringing it up because it's something that's on our radar. >> Sanjay we gotta go but thanks for coming and stopping by theCube. I know you're super busy and great to drop in and see you. >> Always a pleasure and thanks-- >> Congratulations-- >> And Keith good to talk to you again. >> Congratulations, all the success you're having with the show. >> We're doing our work, getting the reports out there, reporting here on theCube, we have two sets, 45,000 people, exclusive coverage on siliconangle.com, more data coming, every day, we have another whole day tomorrow, big night tonight, the Pub Crawl, meetings, VCs, I'll be out there, we'll be out there, grinding it out, ear to the ground, go get those stories and bring it to you. It's theCube live coverage from AWS reInvent 2017, we're back with more after this short break.

>> Voiceover: Live from the Mandalay Bay Convention Center in Las Vegas, it's theCUBE covering VMworld 2016, brought to you by VMware and its ecosystem sponsors. Now here's your host, John Furrier. >> Welcome back everyone. We're here live at VMworld 2016 here in Las Vegas. This is the seventh year of coverage for SiliconANGLE Media's theCUBE, it's our flagship program, we go out to the events and extract the signal from the noise. I'm John Furrier. My co-host John Troyer with TechReckoning. Our next guest is CUBE alumn, one of our favorite guests, Sanjay Poonen who runs the end user computing, he's the General Manager, End User Computing Division of VMware, and also Head of Global Marketing now. Congratulations. New job role to oversee all of marketing, to bring that unified view across the company. Good to see you again, welcome back. >> Thank you John, and the John and John Show. I'm happy, I always love being on your show. >> Yeah, we have another John Walls on the other set over there, so it's three Johns hosting here in theCUBE. >> My middle name is John, let me tell you that, so I fit in the community. >> So Sanjay I want to get right into it. So you're giving us a preview here, folks, for tomorrow, the Keynote, you're the main act kicking off the Keynote tomorrow. A lot of big announcements, a couple super secret announcements that you can't share but you've got some new stuff going on in terms of new announcements, in terms of enhancements and new technologies. So can you share a little bit about tomorrow's announcements and what we'd expect at the Keynote. >> Yeah, thank you. So for everybody watching, make sure you dial in at nine o'clock tomorrow. I mean, the reality is, a key part of this client server to mobile cloud transformation is preparing people for a public cloud, digitally transforming the datacenters and preparing for public cloud, that's what you heard today. And the second piece of that, it's almost like two halves of the egg shell, the bottom part being the datacenter, the top part is preparing end users for an increasingly mobile world. And there we have this concept of a digital workspace, Workspace ONE that we introduced, and we're going to announced some new innovations there which really allow you to bring three things together. >> New products or new enhancements? >> In today's day and age when you're going cloud first, we're moving so fast so we don't do things in one big whole. I mean, for example, with AirWatch, we're doing probably like one incremental big feature every five, ten days. So we are doing things a lot more in the pace of cloud type company. So we don't really bundle everything to one big release. But nonetheless, we really focus our efforts around three gears, we're going to hear about tomorrow, one is the entire basis of how people work is driven now by identity management, and access to apps and identity. So you're going to see that tomorrow. And identity management becomes the important piece of the puzzle that's a control point for people's access to apps. Secondly you're going to hear about unified endpoint management and the worlds of desktop and mobile coming together. A good example of that is Windows 10. I'm going to talk about that more tomorrow. And third is a very important area of management and security, and how we think about endpoint management and endpoint security 'coz security is becoming one of the key missing linchpins that we think we can actually bring together in this digital workspace. So Workspace ONE with key focuses on areas like management and security. >> So you've been kind of, we've been interviewing you now three years. Congratulations, now at VMware, came from SAP as an executive there, now three years in. We've been watching your career, the end user computing evolve. The big bold movement down the field was the AirWatch acquisition. We've then seen a variety of different integration points in there. Give us an update on where it's come from and where, now we see where it's going, you just laid that out, but what are some of the specifics on how it's evolving because now with the cloud decision for the company, to say, okay, public cloud is in our equation with that Pat's announcement today, you've been kind of waiting for that engine, you've been kind of like, hurry up and wait for that to happen. So that's now, it's happening. Take us through how AirWatch in this piece evolved. >> Yeah, when we acquired AirWatch, part of it was our fundamental recognition that without a mobile strategy, you could end user computing. That's the name of our group is end user computing. You could end it 'coz we really needed something. So we looked at the space and we wanted something that was cloud first. They were, I would say, a close number, two or three, Mobile Line, I think was technical lead or maybe Good was, but they had a cloud architecture. We liked that about them. And was about a hundred million-dollar business. We disclosed at the end of last year that business was over 370 million in all in bookings. So you could see how rapidly we've taken them, they're almost 4X in two years. And the overall end user computing business was about a half billion when I joined. We announced at the end of last year, was a 1.2 billion all in bookings run rate company. When I joined it was about 30,000 customers. We're now about 65,000 customers. So reality is, we're now one of the top major businesses within the company. There's a lot of momentum. And that's been, I think, one of the better software acquisitions anybody's done the last two or three years. >> And strategically speaking, the digital transformation framework is essentially around this digital workspace area. >> It came out of that mobile space. And the part that we are now starting to see with clearer lenses in the course of the last six to 12 months is that identity management becomes an important piece to add to VDI mobile management. So we've added a third pillar of focus. And we feel like CIOs shouldn't have to buy VDI from one set of vendors, mobile device management, mobile management from a second, and then identity management from a third. These are coalescing into a digital workspace. So a big focus there. And allows us to also expand into new areas, for example, Iot, we can talk about it this time, and areas like endpoint security. >> It seems like, talking about identity management, that to you is right out of your security story. It seems like identity then has to become the fundamental pillar of security of end users in today's enterprise. How does your security story play into-- >> Yeah that's a very good point John. And I would say you're absolutely right. When we are increasingly selling our end user computing solutions, we're finding a key influencing buyer is the CISO. 40% of people have come to our mobile connect conferences are important to the CISO. Identity is a security topic too. So if you pull up for a second, the VMware security story now is very simple. It's in three parts. Number one, we can protect the datacenter. NSX now, one of the key propositions is micro-segmentation. That's a security seller. Number two, we can protect the endpoint with solutions like AirWatch and TrustPoint, we can get to TrustPoint this time. And number three, we can protect the middle, the user. So protect the datacenter, protect the endpoint, and protect the middle, the user. And all of those make us a very strong story appealing to the CISO. And then we take a bevy of partners with us that have even stronger brands and security. For example, one of our lead partners is Palo Alto. We're working very closely with them in NSX. We're working very closely with them in AirWatch. We're working very closely with them in identity. Another example of partners, F5. So we picked the group of partners that have very strong brands and security. And we found things that we do well. We partner with them in things that they do well. It's a really good story to both the CIO and the CISO. >> So much of the cloud story, as well as the end user story, is also about timing. We've been waiting on public cloud. Pundits talk about the death of private cloud but they don't say what year really. And so a lot of the end user story kind of we had to wait on, VDI, we had to wait on the devices. How do you as a leader of this company look at timing and when the market is ready for something? >> Well, I mean John, I think you have to really look at trends. And I had a fundamental premise coming in that the two Cs, and I'll talk about this more on tomorrow's Keynote, that we really needed to attack with venom was cost and complexity in the VDI market. And part of the reason as I talked to customers that many VDI projects failed, were cost and complexity. So we took a chainsaw to cost and complexity. And it turns out with a lot of what we've invented in the software-defined datacenter, software-defined storage that we were among the first to drive, hyper converged infrastructure, NSX for micro-segmentation, the fundamental premise of this sphere and all that you can do in areas like 3D graphics, we could engineer a solution that was 30 to 40% cheaper than the competition from VDI and app promoting. Complexity. We decided that VDI and app promoting needed to be one platform as opposed to sort of a competition that had like a, two separate products for VDI and app promoting. So these all were things that lowered the total cost of ownership and made that easy. Similarly with mobile, the two S's we attack there was simplicity and security. And we've had some core, I would say, these are the type of things, as a leader, you have to keep telling your teams, is your north pole. We're attacking cost and complexity. Another example of cost and complexity is moving stuff to the cloud. Three years ago we were the first to announce desktop as a service. What was one of the messages this morning, IBM, now embracing that desktop as a service in their cloud, working with us both in IBM cloud and IBM GTS. It's come a long way in three years. >> So I got to ask you about the aspect of unification. We're hearing that tomorrow you're announcing a huge shift in how customers buy and that it ultimately will change the equation on their cost side which is eliminating these point solutions out there. This unification endpoint, I don't know what you're calling it, can you share, give a little bit of leg, as Dave Vellante would say, on this morning tomorrow on this announcement, this consolidation or unification. How should we think about this? >> I mean, I think, and hopefully it's not a surprise 'coz we've been building up this momentum as opposed to one big mega announcement. Workspace ONE is really the coming together of three core areas. VDI and everything related to the way in which we manage desktops and apps, mobile management, and identity management. And in each of those spaces, if you don't look at us, there are point vendors doing each of those. And our differentiation is one, it's unified, second, it's a cloud first solution, many cases the folks have not yet moved to the cloud, and then we extend the capabilities of things like Workspace ONE, optimized for our datacenter where it needs to, into new areas like, for example, security. So we think as you lay this out and then build a partnership ecosystem, with not just security vendors but apps vendors, we're going to have a very large apps vendor on stage with me tomorrow, for the first time on stage, so I'm not going to tell you who it is, but come tomorrow you'll hear that. >> Microsoft, SAP, Salesforce? >> You've got some obvious candidates but it's one of those folks. >> It is one of those folks? >> How many big ones left, right? Some of them have been buying everybody. >> We've got some scoop this year on theCUBE. >> But that's an example of where VMware is taking the lead at embracing an apps ecosystem. >> So I got to ask you, you're a student of history and text, so back in the old days, back in the 90s, when dial-up in internet, Office Connections, Radioservers was a buzzword, you'd have to dial up into a facility, and you have to be authenticated. Pretty straightforward back in the day. But now the authentication, if you will, is coming from endpoints that are, like, anything. Uber could be inside the enterprise and app. So this notion of endpoints is interesting. It's also complicated. So there's not only a security surface area, there's also a cost area to deploy these solutions. Is that the kind of what Workspace ONE does? I mean am I getting it right? Am I thinking it right as an access method? >> I think you've got one piece of it right and I think you're exactly right. In the world of mobile, my fingerprint now becomes, police know that that's unique usually-- >> So does Apple. >> Right. And my retina scan becomes it. So you've got very sophisticated phones, it doesn't have to be complicated ones, that can give you either the fingerprint or the retina scan. You'd have to physically cut my thumb off and pluck my eye. I dare you to do both of those to replicate me. So you can move away from a very-- >> That's two-factor authentication right there. >> Yes, multi-factor, right? So you can move away from tokens becoming your only avenue of multi-factor authentication. You can do things smoothly. But it doesn't end there. Endpoints security has to be re-thought to really work at speed and at scale, so that's why we partnered with this hot security company, you're going to see them also on display tomorrow, Tanium. And with them we built a product called TrustPoint. And we use it internally at VMware. In fact one of the things you're going to see in the demos I do tomorrow, there's going to be lots of demos in 25 minutes, of day of the life of how VMware uses technology both in Workspace ONE and endpoint security. Tanium's one of the hottest products that we internally use and we combine some of our IP with theirs, and created a product called TrustPoint in a Google-like interface. I can search to find all endpoints in the enterprise, what potential apps are running on them, what potential malware's on them, quarantine it and maybe even take action on them with some of the technologies we have from AirWatch. So we've combined the best of Tanium and VMware's technology and this is going to be a real hot solution for areas like Windows 10. >> And what's the uptake you're taking on traction given where you're business is going? You've got some good performance now. What's your expectation on uptake on some of these, this Workspace ONE and the end space? >> If you look at our success so far, I told them, when I joined the company, the business was about a half a billion. We announced the end of last year, it's on a 1.2 billion run rate. So we've effectively more than doubled the business, doubled the customer count. And I think that on our path from 1.2 to two billion over multiple number of years, these solutions are going to become very critical to our growth. Horizon in the desktop portfolio, AirWatch in the mobile portfolio, identity management, and TrustPoint. And when I talk to our sales guys, I say, "Listen, there's enough there to feed "a lot of potential customers," and when I look at our customer count, 65,000 customers, we're still about 9, 10% penetrated inside the overall VMware base. If we can double, triple our customer base, there's no reason why this couldn't be a multi-billion dollar business. >> Alright, so for CXOs whether that's CIOs, chief data officers, chief revenue officers, any CXO, chief security officers, CISOs, all that stuff, for they're watching out there and tomorrow's Keynote, how would you summarize if you have to boil out your point of view and your theme for tomorrow, and some of the key takeaways? >> Four words, consumer-simple, enterprise-secure. There's an element of simplicity that gives you all the productivity that you need with Workspace ONE and your end user world. And then there's a message of security that the IT wants. The users benefit from simplicity, IT benefits from security. Users benefit from choice, IT benefits from control. And you'll hear that very, hopefully, fairly clearly tomorrow. >> Sanjay, final question, your team, VMware, you've amassed quite a team, the performance have been great, when you go back to the ranch inside Palo Alto headquarters and throughout the world, what's your marching orders to the team? What's the guiding principle that you put forth with respect to keeping the pace of innovation to match up the cadence of what's expected, not only by potentially your customers, but also your potential partners and competitors? >> First off, I'm a big believer in serve and leadership. So you have to lead by values that replicate, there's no success without successors, so I'm a hound for talent, I'm always looking for ways by which, just like the warriors, we create the best end user computing team bar none, and I think we've been very fortunate to create that team in every area. There's more talent that we should be hiring. I hear about them and we go recruit them. But once we've got a good team, we keep them focused on the mission. I mean obviously we have a revenue growth goal, and at the core of it, beyond just selling things, we want to make the customers successful. So we keep customer as our north pole. Customer satisfaction for VMware has been the highest of any IT vendor. When you look at many of these, Temkin research does a survey of customer satisfaction, we're among the top five, almost consistently the last few years. And then we make sure that in the products that we build, customer first, serve and leadership at the top, customer-focused, and we are building products, I mean we're an engineering-centric company so we want to build the best products that have a leap factor over the competition. >> So the warriors have a style of play-outs. You have Steph Curry who's just, lights up. But they're not afraid to shoot the three. They're good on transition, great speed. What is your differentiation as an organization? What's that x factor? What's the one thing you can point to? >> I mean, I think, listen, we were probably a little bit lethargic in end user computing. John was joking about this before we just had the show. We want to build great factors and we're a little bit edgy. I mean I've been called everything on Twitter from the Nostradamus of EUC to all kinds of, but we're aggressive, but I will tell you that if people watch me in Twitter, it's never, in the words of The Godfather, it's never personal. It's strictly business. So we have fun. We're a little edgy out there. We're in your face, we want to compete, we want to win every deal but it's never personal. I mean it's just like Steph Curry. You're going to compete hard on the court, but after the game, you go and have a drink with Kobe Bryant or Lebron James or whoever-have-you. >> Well final question, I didn't get this 'coz it's such a good product conversation and organization with your group, now you're heading up marketing, as the VMware, a very community-driven, very data-driven company, thoughts on marketing, you have it on social media, do you see social as being a part of marketing? Do you look at that? Do you look at certain ideas that you see that you put forth? >> First off I think Robin Matlock, our CMO has been doing an amazing job, so I told her this as I took over marketing and communications. Oliver Roll, our Chief Communications Officer is also doing great. Listen, I'm just going to throw more wood in the fire. Things are going good. Let's just get them from good to great. This show is one of the most cultistic shows on the planet because of the way in which she and her team have built this thing. It just gets better and better. But there's a few things I think you're going to see us do more. Customer-based marketing, having customers become our spokespeople. I dream of a day where every ad that we have is the biggest companies in the world or the smallest companies using our technology to either make their business more efficient or save lives. And then increasingly over time, we're going to be also doing vertical-based marketing in certain industries. And social media is a great way of getting that work across. >> We'll you've been on theCUBE as an SAP executive, now three years at VMware, certainly this is seven years you've been with CUBE and you guys do it right, so Robin and team and now you. Thanks for your support, appreciate everything. >> Thank you John and John. >> Sanjay Poonen, the General Manager, End Use Computing, and Global Head of Marketing for VMware here inside theCUBE. I'm John Furrier with John Troyer. You're watching theCUBE. (upbeat music)