(bright music) >> Hello everyone and welcome back to AWS re:Invent, here in wonderful Las Vegas, Nevada. We're theCUBE. I am Savannah Peterson. Joined with my co-host, Dave Vellante. Day four, you look great. Your voice has come back somehow. >> Yeah, a little bit. I don't know how. I took last night off. You guys, I know, were out partying all night, but - >> I don't know what you're talking about. (Dave laughing) >> Well, you were celebrating John's birthday. John Furrier's birthday today. >> Yes, happy birthday John! >> He's on his way to England. >> Yeah. >> To attend his nephew's wedding. Awesome family. And so good luck, John. I hope you feel better, he's got a little cold. >> I know, good luck to the newlyweds. I love this. I know we're both really excited for our next guest, so I'm going to bring out, Lena Smart from MongoDB. Thank you so much for being here. >> Thank you for having me. >> How's the show going for you? >> Good. It's been a long week. And I just, not much voice left, so. >> We'll be gentle on you. >> I'll give you what's left of it. >> All right, we'll take that. >> Okay. >> You had a fireside chat, at the show? >> Lena: I did. >> Can you tell us a little bit about that? >> So we were talking about the Rise, The developer is a platform. In this massive theater. I thought it would be like an intimate, you know, fireside chat. I keep believing them when they say to me come and do these talks, it'll be intimate. And you turn up and there's a stage and a theater and it's like, oh my god. But it was really interesting. It was well attended. Got some really good questions at the end as well. Lots of follow up, which was interesting. And it was really just about, you know, how we've brought together this developer platform that's got our integrated services. It's just what developers want, it gives them time to innovate and disrupt, rather than worry about the minutia of management. >> Savannah: Do the cool stuff. >> Exactly. >> Yeah, so you know Lena, it's funny that you're saying that oh wow, the lights came on and it was this big thing. When when we were at re:Inforced, Lena was on stage and it was so funny, Lena, you were self deprecating like making jokes about the audience. >> Savannah: (indistinct) >> It was hilarious. And so, but it was really endearing to the audience and so we were like - >> Lena: It was terrifying. >> You got huge props for that, I'll tell you. >> Absolutely terrifying. Because they told me I wouldn't see anyone. Because we did the rehearsal the day before, and they were like, it's just going to be like - >> Sometimes it just looks like blackness out there. >> Yeah, yeah. It wasn't, they lied. I could see eyeballs. It was terrifying. >> Would you rather know that going in though? Or is it better to be, is ignorance bliss in that moment? >> Ignorance is bliss. >> Yeah, yeah yeah. >> Good call Savannah, right? Yeah, just go. >> The older I get, the more I'm just, I'm on the ignorance is bliss train. I just, I don't need to know anything that's going to hurt my soul. >> Exactly. >> One of the things that you mentioned, and this has actually been a really frequent theme here on the show this week, is you said that this has been a transformative year for developers. >> Lena: Yeah. >> What did you mean by that? >> So I think developers are starting to come to the fore, if you like, the fore. And I'm not in any way being deprecating about developers 'cause I love them. >> Savannah: I think everyone here does. >> I was married to one, I live with one now. It's like, they follow me everywhere. They don't. But, I think they, this is my opinion obviously but I think that we're seeing more and more the value that developers bring to the table. They're not just code geeks anymore. They're not just code monkeys, you know, churning out lines and lines of code. Some of the most interesting discussions I've had this week have been with developers. And that's why I'm so pleased that our developer data platform is going to give these folks back time, so that they can go and innovate. And do super interesting things and do the next big thing. It was interesting, I was talking to Mary, our comms person earlier and she had said that Dave I guess, my boss, was on your show - >> Dave: Yeah, he was over here last night. >> Yeah. And he was saying that two thirds of the companies that had been mentioned so far, within the whole gamut of this conference use MongoDB. And so take that, extrapolate that, of all the developers >> Wow. >> who are there. I know, isn't that awesome? >> That's awesome. Congrats on that, that's like - >> Did I hear that right now? >> I know, I just had that moment. >> I know she just told me, I'm like, really? That's - >> That's so cool. >> 'Cause the first thing I thought of was then, oh my god, how many developers are we reaching then? 'Cause they're the ones. I mean, it's kind of interesting. So my job has kind of grown from, over the years, being the security geek in the back room that nobody talks to, to avoiding me in the lift, to I've got a seat at the table now. We meet with the board. And I think that I can see that that's where the developer mindset is moving towards. It's like, give us the right tools and we'll change your world. >> And let the human capital go back to doing the fun stuff and not just the maintenance stuff. >> And, but then you say that, you can't have everything automated. I get that automation is also the buzzword of the week. And I get that, trust me. Someone has to write the code to do the automation. >> Savannah: Right. >> So, so yeah, definitely give these people back time, so that they can work on ML, AI, choose your buzzword. You know, by giving people things like queriable encryption for example, you're going to free up a whole bunch of head space. They don't have to worry about their data being, you know harvested from memory or harvested while at rest or in motion. And it's like, okay, I don't have to worry about that now, let me go do something fun. >> How about the role of the developer as it relates to SecOps, right? They're being asked to do a lot. You and I talked about this at re:Inforce. You seem to have a pretty good handle on it. Like a lot of companies I think are struggling with it. I mean, the other thing you said said to me is you don't have a lack of talent at Mongo, right? 'Cause you're Mongo. But a lot of companies do. But a lot of the developers, you know we were just talking about this earlier with Capgemini, the developer metrics or the application development team's metrics might not be aligned with the CSO's metrics. How, what are you seeing there? What, how do you deal with it within Mongo? What do you advise your customers? >> So in terms of internal, I work very closely with our development group. So I work with Tara Hernandez, who's our new VP of developer productivity. And she and her team are very much interested in making developers more productive. That's her job. And so we get together because sometimes security can definitely be seen as a blocker. You know, funnily enough, I actually had a Slack that I had to respond to three seconds before I come on here. And it was like, help, we need some help getting this application through procurement, because blah, blah, blah. And it's weird the kind of change, the shift in mindset. Whereas before they might have gone to procurement or HR or someone to ask for this. Now they're coming to the CSO. 'Cause they know if I say yes, it'll go through. >> Talk about social engineering. >> Exactly. >> You were talking about - >> But turn it around though. If I say no, you know, I don't like to say no. I prefer to be the CSO that says yes, but. And so that's what we've done. We've definitely got that culture of ask, we'll tell you the risks, and then you can go away and be innovative and do what you need to do. And we basically do the same with our customers. Here's what you can do. Our application is secure out of the box. Here's how we can help you make it even more, you know, streamlined or bespoke to what you need. >> So mobile was a big inflection point, you know, I dunno, it seems like forever ago. >> 2007. >> 2007. Yeah, iPhone came out in 2007. >> You remember your first iPhone? >> Dave: Yeah. >> Yeah? Same. >> Yeah. It was pretty awesome, actually. >> Yeah, I do too. >> Yeah, I was on the train to Boston going up to see some friends at MIT on the consortium that I worked with. And I had, it was the wee one, 'member? But you thought it was massive. >> Oh, it felt - >> It felt big. And I remember I was sitting on the train to Boston it was like the Estella and there was these people, these two women sitting beside me. And they were all like glam, like you and unlike me. >> Dave: That's awesome. >> And they, you could see them like nudging each other. And I'm being like, I'm just sitting like this. >> You're chilling. >> Like please look at my phone, come on just look at it. Ask me about it. And eventually I'm like - >> You're baiting them. >> nonchalantly laid it on the table. And you know, I'm like, and they're like, is that an iPhone? And I'm like, yeah, you want to see it? >> I thought you'd never ask. >> I know. And I really played with it. And I showed them all the cool stuff, and they're like, oh we're going to buy iPhones. And so I should have probably worked for Apple, but I didn't. >> I was going to say, where was your referral kickback on that? Especially - >> It was a little like Tesla, right? When you first, we first saw Tesla, it was Ray Wong, you know, Ray? From Pasadena? >> It really was a moment and going from the Blackberry keyboard to that - >> He's like want to see my car? And I'm like oh yeah sure, what's the big deal? >> Yeah, then you see it and you're like, ooh. >> Yeah, that really was such a pivotal moment. >> Anyway, so we lost a track, 2007. >> Yeah, what were we talking about? 2007 mobile. >> Mobile. >> Key inflection point, is where you got us here. Thank you. >> I gotchu Dave, I gotchu. >> Bring us back here. My mind needs help right now. Day four. Okay, so - >> We're all getting here on day four, we're - >> I'm socially engineering you to end this, so I can go to bed and die quietly. That's what me and Mary are, we're counting down the minutes. >> Holy. >> That's so sick. >> You're breaking my heart right now. I love it. I'm with you, sis, I'm with you. >> So I dunno where I was, really where I was going with this, but, okay, there's - >> 2007. Three things happened. >> Another inflection point. Okay yeah, tell us what happened. But no, tell us that, but then - >> AWS, clones, 2006. >> Well 2006, 2007. Right, okay. >> 2007, the iPhone, the world blew up. So you've already got this platform ready to take all this data. >> Dave: Right. >> You've got this little slab of gorgeousness called the iPhone, ready to give you all that data. And then MongoDB pops up, it's like, woo-hoo. But what we could offer was, I mean back then was awesome, but it was, we knew that we would have to iterate and grow and grow and grow. So that was kind of the three things that came together in 2007. >> Yeah, and then Cloud came in big time, and now you've got this platform. So what's the next inflection point do you think? >> Oh... >> Good question, Dave. >> Don't even ask me that. >> I mean, is it Edge? Is it IOT? Is there another disruptor out there? >> I think it's going to be artificial intelligence. >> Dave: Is it AI? >> I mean I don't know enough about it to talk about it, to any level, so don't ask me any questions about it. >> This is like one of those ignorance is bliss moments. It feels right. >> Yeah. >> Well, does it scare you, from a security perspective? Or? >> Great question, Dave. >> Yeah, it scares me more from a humanity standpoint. Like - >> More than social scared you? 'Cause social was so benign when it started. >> Oh it was - >> You're like, oh - I remember, >> It was like a yearbook. I was on the Estella and we were - >> Shout out to Amtrak there. >> I was with, we were starting basically a wikibond, it was an open source. >> Yeah, yeah. >> Kind of, you know, technology community. And we saw these and we were like enamored of Facebook. And there were these two young kids on the train, and we were at 'em, we were picking the brain. Do you like Facebook? "I love Facebook." They're like "oh, Facebook's unbelievable." Now, kids today, "I hate Facebook," right? So, but social at the beginning it was kind of, like I say, benign and now everybody's like - >> Savannah: We didn't know what we were getting into. >> Right. >> I know. >> Exactly. >> Can you imagine if you could have seen into the future 20 years ago? Well first of all, we'd have all bought Facebook and Apple stock. >> Savannah: Right. >> And Tesla stock. But apart from, but yeah apart from that. >> Okay, so what about Quantum? Does that scare you at all? >> I think the only thing that scares me about Quantum is we have all this security in place today. And I'm not an expert in Quantum, but we have all this security in place that's securing what we have today. And my worry is, in 10 years, is it still going to be secure? 'Cause we're still going to be using that data in some way, shape, or form. And my question is to the quantum geniuses out there, what do we do in 10 years like to retrofit the stuff? >> Dave: Like a Y2K moment? >> Kind of. Although I think Y2K is coming in 2038, isn't it? When the Linux date flips. I'll be off the grid by then, I'll be living in Scotland. >> Somebody else's problem. >> Somebody else's problem. I'll be with the sheep in Glasgow, in Scotland. >> Y2K was a boondoggle for tech, right? >> What a farce. I mean, that whole - >> I worked in the power industry in Y2K. That was a nightmare. >> Dave: Oh I bet. >> Savannah: Oh my God. >> Yeah, 'cause we just assumed that the world was going to stop and there been no power, and we had nuclear power plants. And it's like holy moly. Yeah. >> More than moly. >> I was going to say, you did a good job holding that other word in. >> I think I was going to, in case my mom hears this. >> I grew up near Diablo Canyon in, in California. So you were, I mean we were legitimately worried that that exactly was going to happen. And what about the waste? And yeah it was chaos. We've covered a lot. >> Well, what does worry you? Like, it is culture? Is it - >> Why are you trying to freak her out? >> No, no, because it's a CSO, trying to get inside the CSO's head. >> You don't think I have enough to worry about? You want to keep piling on? >> Well if it's not Quantum, you know? Maybe it's spiders or like - >> Oh but I like spiders, well spiders are okay. I don't like bridges, that's my biggest fear. Bridges. >> Seriously? >> And I had to drive over the Tappan Zee bridge, which is one of the longest, for 17 years, every day, twice. The last time I drove over it, I was crying my heart out, and happy as anything. >> Stay out of Oakland. >> I've never driven over it since. Stay out of where? >> Stay out of Oakland. >> I'm staying out of anywhere that's got lots of water. 'Cause it'll have bridges. >> Savannah: Well it's good we're here in the desert. >> Exactly. So what scares me? Bridges, there you go. >> Yeah, right. What? >> Well wait a minute. So if I'm bridging technology, is that the scary stuff? >> Oh God, that was not - >> Was it really bad? >> It was really bad. >> Wow. Wow, the puns. >> There's a lot of seems in those bridges. >> It is lit on theCUBE A floor, we are all struggling. I'm curious because I've seen, your team is all over the place here on the show, of course. Your booth has been packed the whole time. >> Lena: Yes. >> The fingerprint. Talk to me about your shirt. >> So, this was designed by my team in house. It is the most wanted swag in the company, because only my security people wear it. So, we make it like, yeah, you could maybe have one, if this turns out well. >> I feel like we're on the right track. >> Dave: If it turns out well. >> Yeah, I just love it. It's so, it's just brilliant. I mean, it's the leaf, it's a fingerprint. It's just brilliant. >> That's why I wanted to call it out. You know, you see a lot of shirts, a lot of swag shirts. Some are really unfortunately sad, or not funny, >> They are. >> or they're just trying too hard. Now there's like, with this one, I thought oh I bet that's clever. >> Lena: It is very cool. Yes, I love it. >> I saw a good one yesterday. >> Yeah? >> We fix shit, 'member? >> Oh yeah, yeah. >> That was pretty good. >> I like when they're >> That's a pretty good one. >> just straightforward, like that, yeah yeah. >> But the only thing with this is when you're say in front of a green screen, you look as though you've got no tummy. >> A portal through your body. >> And so, when we did our first - >> That's a really good point, actually. >> Yeah, it's like the black hole to nothingless. And I'm like wow, that's my soul. >> I was just going to say, I don't want to see my soul like that. I don't want to know. >> But we had to do like, it was just when the pandemic first started, so we had to do our big presentation live announcement from home. And so they shipped us all this camera equipment for home and thank God my partner knows how that works, so he set it all up. And then he had me test with a green screen, and he's like, you have no tummy. I'm like, what the hell are you talking about? He's like, come and see. It's like this, I dunno what it was. So I had to actually go upstairs and felt tip with a magic marker and make it black. >> Wow. >> So that was why I did for two hours on a Friday, yeah. >> Couldn't think of another alternative, huh? >> Well no, 'cause I'm myopic when it comes to marketing and I knew I had to keep the tshirt on, and I just did that. >> Yeah. >> In hindsight, yes I could have worn an "I Fix Shit" tshirt, but I don't think my husband would've been very happy. I secure shit? >> There you go, yeah. >> There you go. >> Over to you, Savannah. >> I was going to say, I got acquainted, I don't know if I can say this, but I'm going to say it 'cause we're here right now. I got acquainted with theCUBE, wearing a shirt that said "Unfuck Kubernetes," 'cause it was a marketing campaign that I was running for one of my clients at Kim Con last year. >> That's so good. >> Yeah, so - >> Oh my God. I'll give you one of these if you get me one of those. >> I can, we can do a swapskee. We can absolutely. >> We need a few edits on this film, on the file. >> Lena: Okay, this is nothing - >> We're fallin' off the wheel. Okay, on that note, I'm going to bring us to our challenge that we discussed, before we got started on this really diverse discussion that we have had in the last 15 minutes. We've covered everything from felt tip markers to nuclear power plants. >> To the darkness of my soul. >> To the darkness of all of our souls. >> All of our souls, yes. >> Which is perhaps a little too accurate, especially at this stage in the conference. You've obviously seen a lot Lena, and you've been rockin' it, I know John was in your suite up here, at at at the Venetian. What's your 30 second hot take? Most important story, coming out of the show or for you all at Mongo this year? >> Genuinely, it was when I learned that two-thirds of the customers that had been mentioned, here, are MongoDB customers. And that just exploded in my head. 'Cause now I'm thinking of all the numbers and the metrics and how we can use that. And I just think it's amazing, so. >> Yeah, congratulations on that. That's awesome. >> Yeah, I thought it was amazing. >> And it makes sense actually, 'cause Mongo so easy to use. We were talking about Tengen. >> We knew you when, I feel that's our like, we - >> Yeah, but it's true. And so, Mongo was just really easy to use. And people are like, ah, it doesn't scale. It's like, turns out it actually does scale. >> Lena: Turns out, it scales pretty well. >> Well Lena, without question, this is my favorite conversation of the show so far. >> Thank you. >> Thank you so much for joining us. >> Thank you very much for having me. >> Dave: Great to see you. >> It's always a pleasure. >> Dave: Thanks Lena. >> Thank you. >> And thank you all, tuning in live, for tolerating wherever we take these conversations. >> Dave: Whatever that was. >> I bet you weren't ready for this one, folks. We're at AWS re:Invent in Las Vegas, Nevada. With Dave Vellante, I'm Savannah Peterson. You're washing theCUBE, the leader for high tech coverage.

(upbeat music) >> Hey, welcome back, everyone, to Supercloud22. I'm John Furrier, host of "theCUBE." We're here all day talking about the future of cloud, where it's all going, making it super. Multicloud's around the corner, and public cloud is winning. Got the private cloud on premise and edge. Got a great guest here, Bhaskar Gorti, CEO of Platform9, just on the panel on Kubernetes, an enabler or blocker. Welcome back. Great to have you on. >> Good to see you again. >> So Kubernetes is a blocker or enabler with a question mark I put on. That panel was really to discuss the role of Kubernetes. Now, great conversation, operations it's impacted. What's interesting about what you guys are doing at Platform9 is your role there as CEO and the company's position, kind of like the world spun into the direction of Platform9 while you were at the helm. >> Right, absolutely. In fact, things are moving very well, and since they came to us. (John chuckling) It was an insight to call ourselves a platform company eight years ago, right, so absolutely, whether you are doing it in public clouds or private clouds, you know, the application world is moving very fast in trying to become digital and cloud native. There are many options for you to run infrastructure. The biggest blocking factor now is having a unified platform, and that's what area we come into. >> Bhaskar, we were talking before we came on stage here about your background, and we were kind of talking about the glory days of 2000, 2001, when the first ASPs, application service providers, came out, kind of a SaaS vibe, but that was kind of all, kind of cloud-like. >> It was! >> And web services started then too, so you saw that whole growth. Now fast-forward 20 years later, 22 years later, where we are now, when you look back then to here and all the different cycles. >> In fact, you know, as we were talking offline, you know, I was in one of those ASPs in the year 2000, where it was a novel concept of saying we are providing a software and a capability as a service, right. You sign up and start using it. I think a lot has changed since then, the tooling, the tools, the technology has really skyrocketed. The app development environment has really taken off exceptionally well. There are many, many choices of infrastructure now, right, so I think things are in a way the same, but also extremely different, but more importantly, now, for any company, regardless of size, to be a digital native, to become a digital company, is extremely mission-critical. It's no longer a nice to have. Everybody's in the journey somewhere. >> Everyone is going digital transformation. Here, even on a so-called downturn, recession that's upcoming, inflation's here, it's interesting. This is the first downturn in the history of the world where the hyperscaled clouds, they're been pumping on all cylinders, as an economic input, and if you look at the tech trends, GDP's down, but not tech. >> Nope. >> 'Cause the pandemic showed everyone, digital transformation is here, and more spend and more growth is coming even in tech. So this is a unique factor, which proves that that digital transformation's happening, and every company will need a supercloud. >> Everyone, every company regardless of size, regardless of location, has to become modernized in infrastructure, and modernizing infrastructure is not just some new servers and new application tools. It's your approach, how you're serving your customers, how you're bringing agility in your organization. I think that is becoming a necessity for every enterprise to survive. >> I want to get your thoughts on supercloud because one of the things Dave Vellante and I wanted to do with supercloud and calling it that was, I personally, and I know Dave as well. He can speak for himself. We didn't like multicloud, I mean, not because Amazon said, "Don't call things multicloud." It just didn't feel right. I mean, everyone has multiple clouds by default. If you're running productivity software, you have Azure and Office 365, but it wasn't truly distributed. It wasn't truly decentralized. It wasn't truly cloud-enabled. It felt like they're not ready for a market yet, yet public cloud's booming. On premise, private cloud and edge is much more, you know, more dynamic, more real. >> Yeah, I think the reason why we think supercloud is a better term than multicloud, multicloud are more than one cloud, but they're disconnected, okay. You have a productivity cloud. You have a Salesforce cloud. Everyone has an internal cloud, right, but they are not connected, so you can say, "Okay, it's more than one cloud, so it's multicloud," but supercloud is where you are actually trying to look at this holistically, whether it is on prem, whether it is public, whether it's at the edge, it's at store, at the branch, you are looking at this as one unit, and that's where we see the term supercloud is more applicable because what are the qualities that you require if you're in a supercloud, right? You need choice of infrastructure, but at the same time, you need a single platform for you to build your innovations on regardless of which cloud you're doing it on, right, so I think supercloud is actually a more tightly integrated, orchestrated management philosophy, we think. >> So let's get into some of the supercloud-type trends that we've been reporting on. Again, the purpose of this event is as the pilots, get the conversations flowing with the influencers like yourselves who are running companies and building products and the builders. Amazon and Azure are doing extremely well. Google's coming up in third. Cloudworks in public cloud, we see the use cases, on premises use cases. (arm thudding) Kubernetes has been an interesting phenomenon because it's been coming from the developer side a little bit, but a lot of ops people love Kubernetes. It's really more of an ops thing. You mentioned OpenStack earlier. Kubernetes kind of came out of that OpenStack. We need an orchestration, and then containers had a good shot with Docker. They repivoted the company. Now, they're all in an open source, so you got containers booming and Kubernetes as a new layer there. What's the take on that? What does that really mean? Is that a new de facto enabler? >> It is here. It's for here for sure. Every enterprise, somewhere in the journey's going on, and you know, most companies, or 70-plus percent of them, have one, two, three container-based, Kubernetes-based applications now being rolled out, so it's very much here. It is in production at scale by many customers, and the beauty of it is yes, open source, but the biggest gating factor is the skillset, and that's where we have a phenomenal engineering team, right, so it's one thing to buy a tool, and another one- >> And just to be clear, you're a managed service for Kubernetes. >> We provide a software platform for cloud acceleration as a service, and it can run anywhere. It can run on public, private. We have customers who do it in truly multicloud environments. It runs on the edge. It runs in stores. There are thousands of stores and retailer. So we provide that, and also for specific segments where data sovereignty and data residency are key regulatory reasons. We also run on prem as an air gap version. >> Can you give an example on how you guys are deploying your platform to enable a supercloud experience for your customer? >> Right. I'll give you two different examples. One is a very large networking company, public networking company. They have, I don't know, hundreds of products, hundreds of foreign lead teams that are building different products, and if you look a few years back, each one was doing it on a different platform, but they really needed to bring the agility, and they worked with us now over three years, where we are their build test dev platform where all their products are built on, right, and it has dramatically increased their agility to release new products. Number two, it actually is a light-sort operation. In fact, the customer says, like the Maytag service person, 'cause we provide it as a service, and it barely takes one or two people to maintain it for them. So it's kind of like an instant revibe, one person managing a large- >> 4,000 engineers building infrastructure. >> On their tools, whatever they want to do. >> On their tools. They're using whatever app development tools they use, but they use our platform as a service. >> And what benefits are they seeing? Are they seeing speed? >> Speed definitely. >> Okay. >> Definitely, they're seeing speed. Uniformity, because now, they're able to build. So their customers, who are using product A and product B, are seeing a similar set of tools that are being used. >> So a big problem that's coming out of this supercloud event that we're seeing, and we've heard it all here, ops and security teams 'cause they're kind of part of one team, but ops and security specifically need to catch up speed-wise. Are you delivering that value to ops and security? >> Right, so we work with ops and security teams and infrastructure teams, and we layer on top of that. We have like a platform team. If you think about it, depending on where you have data centers, where you have infrastructure, you'll have multiple teams, okay, but you need a unified platform. >> Who's your buyer? >> Our buyer is usually, you know, the product divisions of companies that are looking at, or the CTO would be a buyer for us functionally, CIO definitely. So it's somewhere in the DevOps to infrastructure, but the ideal one we are beginning to see now, many large corporations are really looking at it as a platform and saying, "We have a platform group on which any app can be developed, and it is run on any infrastructure," so the platform engineering teams- >> So you work on two sides of that coin. You've got the dev side and then? >> And the infrastructure. >> On the upside, okay. >> Another customer, and I'll give you an example, which I would say is kind of the edge or the store, so they have thousands of stores. >> Retail. >> Retail, you know, food retailer, right. They have thousands of stores around the globe, 50,000; 60,000, and they really want to enhance the customer experience that happens when you either order the product or go into the store and pick up your product or buy or browse or sit there. There are applications that were done in the '90s, and then they have very modern AI/ML applications today. They want something that will not have to send an IT person to install a rack in the store, or they can't move everything to the cloud because the store operations has to be local. They menu changes based on- >> It's the classic edge. >> It's classic edge, right. >> Yeah. >> They can't send IT people to go install racks of servers. Then they can't send software people to go install the software, and any change you want to put through that. There are truckloads, so they've been working with us where all they do is they ship, depending on the size of the store, one or two or three little servers with instructions that- >> You say little servers. Like how big? >> One, you know. >> Like a Netgear box? >> It's a box. >> Like small little light box. >> Yeah, it's a box. >> And all the person in the store has to do, like what you and I do at home, and we get a, you know, a router, is connect the power, connect the internet, and turn the switch on, and from there, we pick it up, we provide the operating system, everything, and then the applications are put on it, and so that dramatically brings the velocity for them. They manage thousands like that. >> True plug and play. >> True plug and play, thousands of stores. They manage it centrally. We do it for them, right, so that's another example where on the edge. Then we have some customers who have both a large private presence and one of the public clouds, okay, but they want to have the same platform layer of orchestration and management that they can use regardless of the location. >> So you guys got some success. Congratulations. Got some traction there. That's awesome. The question I want to ask you that's come up is what is truly cloud native? 'Cause there's lift and shift to the cloud. >> That's not cloud native. >> Then there's cloud native. Cloud native seems to be the driver for the super cloud. How do you talk to customers? How do you explain when someone says, "What's cloud native? What isn't cloud native?" >> Right, look, I think, first of all, the best place to look at what is the definition, and what are the attributes and characteristics of what is truly a cloud native, a CNC foundation. I mean, I think it's very well-documented, very well- >> KubeCon, of course, in Detroit's coming out. >> So it's already there, right. So we follow that very closely, right. I think just lifting and shifting your 20-year-old application onto a data center somewhere is not cloud native, okay. You can't port to cloud native. You have to rewrite and redevelop your application and business logic using modern tools, hopefully more open source, and I think that's what cloud native is, and we are seeing a lot of our customers in that journey. Now, everybody wants to be cloud native, but it's not that easy, okay, because I think it's, first of all, skillset is very important, uniformity of tools. There's so many tools. There are thousands and thousands of tools. You could spend your time figuring out which tool to use. (John laughing) Okay, so I think the complexity's there, but the business benefits of agility and uniformity and customer experience are truly being done, and I'll give you an example. I don't know how cloud native they are, right, and they're not a customer of ours, but you order pizzas. You do, right? If you just watch the pizza industry, how Domino's actually increase their share, and mine share and wallet share was not because they were making better pizzas or not. I don't know anything about that, but the whole experience of how you order, and how you watch what's happening, how it's delivered, they were the pioneer in it. To me, those are the kinds of customer experiences that cloud native can provide. >> Being agility and having that flow to the application changes what the expectations are for the customer. >> Customer, the customer's expectations change, right. Once you get used to a better customer experience, you will not. >> Bhaskar, to wrap it up, I want to just get your perspective again. One of the benefits of chatting with you here and having you a part of the Supercloud22 is you've seen many cycles. You have a lot of insights. I want to ask you, given your career, where you've been, and what you've done, and now, the CEO of Platform9, how would you compare what's happening now with other inflection points in the industry? And you've been, again, you've been an entrepreneur. You sold your company to Oracle. You've been seeing the big companies. You're seeing the different waves. What's going on right now? Put it into context, this moment in time, all right, supercloud. >> Sure. I think, as you said, a lot of battle scars. Being in an ASP, being in a realtime software company, being in large enterprise software houses in a transformation. I've been on the outside. I did the infrastructure, right, and then tried to build our own platforms. I've gone through all of this myself with a lot of lessons learned in there. I think this is an event which is happening now for companies to become cloud native and digitalized, if I were to look back and look at some parallels of the tsunami (chuckles) that's going on, couple of parallels come to me. One is, think of it which is forced on us, like Y2K. Everybody around the world had to have a plan, a strategy, and an execution for Y2K. I would say the next big thing was ecommerce. I think ecommerce has been pervasive, right, across all industries. >> And disruptive. >> And disruptive, extremely disruptive. If you did not adapt and adapt and accelerate your ecommerce initiative, it was an existence question. I think we are at that pivotal moment now in companies trying to become digital and cloud native. That is what I see happening now. >> I think that ecommerce is interesting, and I think, just to riff with you on that, is that it's disrupting and refactoring the business models. I think that is something that's coming out of this is that it's not just completely changing the game. It's just changing how you operate. >> How you think and how you operate, see, if you think about the early days of ecommerce, just putting up a shopping cart didn't make you an ecommerce or an eretailer or an ecustomer, right. So I think it's the same thing now, is I think this is a fundamental shift on how you're thinking about your business, how you would operate, how you want to service your customers. I think it requires that just lift and shift is not going to work. >> Bhaskar, thank you for coming on, spending the time to come in and share with our community and being part of Supercloud22. We really appreciate it. We're going to keep this open. We're going to keep this conversation going even after the event to open up and look at the structural changes happening now and continue to look at it in the open, in the community, and we're going to keep this going for a long, long time as we get answers to the problems that customers are looking for with cloud, cloud computing. I'm John Furrier with Supercloud22 and "theCUBE." Thanks for watching. (upbeat music)

(upbeat music) >> Welcome to this CUBE Power Panel where we're going to talk about application modernization, also success templates, and take a look at some new survey data to see how CIOs are thinking about digital transformation, as we get deeper into the post isolation economy. And with me are three familiar VIP guests to CUBE audiences. Tony Bear, the principal at DB InSight, Doug Henschen, VP and principal analyst at Constellation Research and Sanjeev Mohan principal at SanjMo. Guys, good to see you again, welcome back. >> Thank you. >> Glad to be here. >> Thanks for having us. >> Glad to be here. >> All right, Doug. Let's get started with you. You know, this recent survey, which was commissioned by Couchbase, 650 CIOs and CTOs, and IT practitioners. So obviously very IT heavy. They responded to the following question, "In response to the pandemic, my organization accelerated our application modernization strategy and of course, an overwhelming majority, 94% agreed or strongly agreed." So I'm sure, Doug, that you're not shocked by that, but in the same survey, modernizing existing technologies was second only behind cyber security is the top investment priority this year. Doug, bring us into your world and tell us the trends that you're seeing with the clients and customers you work with in their modernization initiatives. >> Well, the survey, of course, is spot on. You know, any Constellation Research analyst, any systems integrator will tell you that we saw more transformation work in the last two years than in the prior six to eight years. A lot of it was forced, you know, a lot of movement to the cloud, a lot of process improvement, a lot of automation work, but transformational is aspirational and not every company can be a leader. You know, at Constellation, we focus our research on those market leaders and that's only, you know, the top 5% of companies that are really innovating, that are really disrupting their markets and we try to share that with companies that want to be fast followers, that these are the next 20 to 25% of companies that don't want to get left behind, but don't want to hit some of the same roadblocks and you know, pioneering pitfalls that the real leaders are encountering when they're harnessing new technologies. So the rest of the companies, you know, the cautious adopters, the laggards, many of them fall by the wayside, that's certainly what we saw during the pandemic. Who are these leaders? You know, the old saw examples that people saw at the Amazons, the Teslas, the Airbnbs, the Ubers and Lyfts, but new examples are emerging every year. And as a consumer, you immediately recognize these transformed experiences. One of my favorite examples from the pandemic is Rocket Mortgage. No disclaimer required, I don't own stock and you're not client, but when I wanted to take advantage of those record low mortgage interest rates, I called my current bank and some, you know, stall word, very established conventional banks, I'm talking to you Bank of America, City Bank, and they were taking days and weeks to get back to me. Rocket Mortgage had the locked in commitment that day, a very proactive, consistent communications across web, mobile, email, all customer touchpoints. I closed in a matter of weeks an entirely digital seamless process. This is back in the gloves and masks days and the loan officer came parked in our driveway, wiped down an iPad, handed us that iPad, we signed all those documents digitally, completely electronic workflow. The only wet signatures required were those demanded by the state. So it's easy to spot these transformed experiences. You know, Rocket had most of that in place before the pandemic, and that's why they captured 8% of the national mortgage market by 2020 and they're on track to hit 10% here in 2022. >> Yeah, those are great examples. I mean, I'm not a shareholder either, but I am a customer. I even went through the same thing in the pandemic. It was all done in digital it was a piece of cake and I happened to have to do another one with a different firm and stuck with that firm for a variety of reasons and it was night and day. So to your point, it was a forced merge to digital. If you were there beforehand, you had real advantage, it could accelerate your lead during the pandemic. Okay, now Tony bear. Mr. Bear, I understand you're skeptical about all this buzz around digital transformation. So in that same survey, the data shows that the majority of respondents said that their digital initiatives were largely reactive to outside forces, the pandemic compliance changes, et cetera. But at the same time, they indicated that the results while somewhat mixed were generally positive. So why are you skeptical? >> The reason being, and by the way, I have nothing against application modernization. The problem... I think the problem I ever said, it often gets conflated with digital transformation and digital transformation itself has become such a buzzword and so overused that it's really hard, if not impossible to pin down (coughs) what digital transformation actually means. And very often what you'll hear from, let's say a C level, you know, (mumbles) we want to run like Google regardless of whether or not that goal is realistic you know, for that organization (coughs). The thing is that we've been using, you know, businesses have been using digital data since the days of the mainframe, since the... Sorry that data has been digital. What really has changed though, is just the degree of how businesses interact with their customers, their partners, with the whole rest of the ecosystem and how their business... And how in many cases you take look at the auto industry that the nature of the business, you know, is changing. So there is real change of foot, the question is I think we need to get more specific in our goals. And when you look at it, if we can boil it down to a couple, maybe, you know, boil it down like really over simplistically, it's really all about connectedness. No, I'm not saying connectivity 'cause that's more of a physical thing, but connectedness. Being connected to your customer, being connected to your supplier, being connected to the, you know, to the whole landscape, that you operate in. And of course today we have many more channels with which we operate, you know, with customers. And in fact also if you take a look at what's happening in the automotive industry, for instance, I was just reading an interview with Bill Ford, you know, their... Ford is now rapidly ramping up their electric, you know, their electric vehicle strategy. And what they realize is it's not just a change of technology, you know, it is a change in their business, it's a change in terms of the relationship they have with their customer. Their customers have traditionally been automotive dealers who... And the automotive dealers have, you know, traditionally and in many cases by state law now have been the ones who own the relationship with the end customer. But when you go to an electric vehicle, the product becomes a lot more of a software product. And in turn, that means that Ford would have much more direct interaction with its end customers. So that's really what it's all about. It's about, you know, connectedness, it's also about the ability to act, you know, we can say agility, it's about ability not just to react, but to anticipate and act. And so... And of course with all the proliferation, you know, the explosion of data sources and connectivity out there and the cloud, which allows much more, you know, access to compute, it changes the whole nature of the ball game. The fact is that we have to avoid being overwhelmed by this and make our goals more, I guess, tangible, more strictly defined. >> Yeah, now... You know, great points there. And I want to just bring in some survey data, again, two thirds of the respondents said their digital strategies were set by IT and only 26% by the C-suite, 8% by the line of business. Now, this was largely a survey of CIOs and CTOs, but, wow, doesn't seem like the right mix. It's a Doug's point about, you know, leaders in lagers. My guess is that Rocket Mortgage, their digital strategy was led by the chief digital officer potentially. But at the same time, you would think, Tony, that application modernization is a prerequisite for digital transformation. But I want to go to Sanjeev in this war in the survey. And respondents said that on average, they want 58% of their IT spend to be in the public cloud three years down the road. Now, again, this is CIOs and CTOs, but (mumbles), but that's a big number. And there was no ambiguity because the question wasn't worded as cloud, it was worded as public cloud. So Sanjeev, what do you make of that? What's your feeling on cloud as flexible architecture? What does this all mean to you? >> Dave, 58% of IT spend in the cloud is a huge change from today. Today, most estimates, peg cloud IT spend to be somewhere around five to 15%. So what this number tells us is that the cloud journey is still in its early days, so we should buckle up. We ain't seen nothing yet, but let me add some color to this. CIOs and CTOs maybe ramping up their cloud deployment, but they still have a lot of problems to solve. I can tell you from my previous experience, for example, when I was in Gartner, I used to talk to a lot of customers who were in a rush to move into the cloud. So if we were to plot, let's say a maturity model, typically a maturity model in any discipline in IT would have something like crawl, walk, run. So what I was noticing was that these organizations were jumping straight to run because in the pandemic, they were under the gun to quickly deploy into the cloud. So now they're kind of coming back down to, you know, to crawl, walk, run. So basically they did what they had to do under the circumstances, but now they're starting to resolve some of the very, very important issues. For example, security, data privacy, governance, observability, these are all very big ticket items. Another huge problem that nav we are noticing more than we've ever seen, other rising costs. Cloud makes it so easy to onboard new use cases, but it leads to all kinds of unexpected increase in spikes in your operating expenses. So what we are seeing is that organizations are now getting smarter about where the workloads should be deployed. And sometimes it may be in more than one cloud. Multi-cloud is no longer an aspirational thing. So that is a huge trend that we are seeing and that's why you see there's so much increased planning to spend money in public cloud. We do have some issues that we still need to resolve. For example, multi-cloud sounds great, but we still need some sort of single pane of glass, control plane so we can have some fungibility and move workloads around. And some of this may also not be in public cloud, some workloads may actually be done in a more hybrid environment. >> Yeah, definitely. I call it Supercloud. People win sometimes-- >> Supercloud. >> At that term, but it's above multi-cloud, it floats, you know, on topic. But so you clearly identified some potholes. So I want to talk about the evolution of the application experience 'cause there's some potholes there too. 81% of their respondents in that survey said, "Our development teams are embracing the cloud and other technologies faster than the rest of the organization can adopt and manage them." And that was an interesting finding to me because you'd think that infrastructure is code and designing insecurity and containers and Kubernetes would be a great thing for organizations, and it is I'm sure in terms of developer productivity, but what do you make of this? Does the modernization path also have some potholes, Sanjeev? What are those? >> So, first of all, Dave, you mentioned in your previous question, there's no ambiguity, it's a public cloud. This one, I feel it has quite a bit of ambiguity because it talks about cloud and other technologies, that sort of opens up the kimono, it's like that's everything. Also, it says that the rest of the organization is not able to adopt and manage. Adoption is a business function, management is an IT function. So I feed this question is a bit loaded. We know that app modernization is here to stay, developing in the cloud removes a lot of traditional barriers or procuring instantiating infrastructure. In addition, developers today have so many more advanced tools. So they're able to develop the application faster because they have like low-code/no-code options, they have notebooks to write the machine learning code, they have the entire DevOps CI/CD tool chain that makes it easy to version control and push changes. But there are potholes. For example, are developers really interested in fixing data quality problems, all data, privacy, data, access, data governance? How about monitoring? I doubt developers want to get encumbered with all of these operationalization management pieces. Developers are very keen to deliver new functionality. So what we are now seeing is that it is left to the data team to figure out all of these operationalization productionization things that the developers have... You know, are not truly interested in that. So which actually takes me to this topic that, Dave, you've been quite actively covering and we've been talking about, see, the whole data mesh. >> Yeah, I was going to say, it's going to solve all those data quality problems, Sanjeev. You know, I'm a sucker for data mesh. (laughing) >> Yeah, I know, but see, what's going to happen with data mesh is that developers are now going to have more domain resident power to develop these applications. What happens to all of the data curation governance quality that, you know, a central team used to do. So there's a lot of open ended questions that still need to be answered. >> Yeah, That gets automated, Tony, right? With computational governance. So-- >> Of course. >> It's not trivial, it's not trivial, but I'm still an optimist by the end of the decade we'll start to get there. Doug, I want to go to you again and talk about the business case. We all remember, you know, the business case for modernization that is... We remember the Y2K, there was a big it spending binge and this was before the (mumbles) of the enterprise, right? CIOs, they'd be asked to develop new applications and the business maybe helps pay for it or offset the cost with the initial work and deployment then IT got stuck managing the sprawling portfolio for years. And a lot of the apps had limited adoption or only served a few users, so there were big pushes toward rationalizing the portfolio at that time, you know? So do I modernize, they had to make a decision, consolidate, do I sunset? You know, it was all based on value. So what's happening today and how are businesses making the case to modernize, are they going through a similar rationalization exercise, Doug? >> Well, the Y2K era experience that you talked about was back in the days of, you know, throw the requirements over the wall and then we had waterfall development that lasted months in some cases years. We see today's most successful companies building cross functional teams. You know, the C-suite the line of business, the operations, the data and analytics teams, the IT, everybody has a seat at the table to lead innovation and modernization initiatives and they don't start, the most successful companies don't start by talking about technology, they start by envisioning a business outcome by envisioning a transformed customer experience. You hear the example of Amazon writing the press release for the product or service it wants to deliver and then it works backwards to create it. You got to work backwards to determine the tech that will get you there. What's very clear though, is that you can't transform or modernize by lifting and shifting the legacy mess into the cloud. That doesn't give you the seamless processes, that doesn't give you data driven personalization, it doesn't give you a connected and consistent customer experience, whether it's online or mobile, you know, bots, chat, phone, everything that we have today that requires a modern, scalable cloud negative approach and agile deliver iterative experience where you're collaborating with this cross-functional team and course correct, again, making sure you're on track to what's needed. >> Yeah. Now, Tony, both Doug and Sanjeev have been, you know, talking about what I'm going to call this IT and business schism, and we've all done surveys. One of the things I'd love to see Couchbase do in future surveys is not only survey the it heavy, but also survey the business heavy and see what they say about who's leading the digital transformation and who's in charge of the customer experience. Do you have any thoughts on that, Tony? >> Well, there's no question... I mean, it's kind like, you know, the more things change. I mean, we've been talking about that IT and the business has to get together, we talked about this back during, and Doug, you probably remember this, back during the Y2K ERP days, is that you need these cross functional teams, we've been seeing this. I think what's happening today though, is that, you know, back in the Y2K era, we were basically going into like our bedrock systems and having to totally re-engineer them. And today what we're looking at is that, okay, those bedrock systems, the ones that basically are keeping the lights on, okay, those are there, we're not going to mess with that, but on top of that, that's where we're going to innovate. And that gives us a chance to be more, you know, more directed and therefore we can bring these related domains together. I mean, that's why just kind of, you know, talk... Where Sanjeev brought up the term of data mesh, I've been a bit of a cynic about data mesh, but I do think that work and work is where we bring a bunch of these connected teams together, teams that have some sort of shared context, though it's everybody that's... Every team that's working, let's say around the customer, for instance, which could be, you know, in marketing, it could be in sales, order processing in some cases, you know, in logistics and delivery. So I think that's where I think we... You know, there's some hope and the fact is that with all the advanced, you know, basically the low-code/no-code tools, they are ways to bring some of these other players, you know, into the process who previously had to... Were sort of, you know, more at the end of like a, you know, kind of a... Sort of like they throw it over the wall type process. So I do believe, but despite all my cynicism, I do believe there's some hope. >> Thank you. Okay, last question. And maybe all of you could answer this. Maybe, Sanjeev, you can start it off and then Doug and Tony can chime in. In the survey, about a half, nearly half of the 650 respondents said they could tangibly show their organizations improve customer experiences that were realized from digital projects in the last 12 months. Now, again, not surprising, but we've been talking about digital experiences, but there's a long way to go judging from our pandemic customer experiences. And we, again, you know, some were great, some were terrible. And so, you know, and some actually got worse, right? Will that improve? When and how will it improve? Where's 5G and things like that fit in in terms of improving customer outcomes? Maybe, Sanjeev, you could start us off here. And by the way, plug any research that you're working on in this sort of area, please do. >> Thank you, Dave. As a resident optimist on this call, I'll get us started and then I'm sure Doug and Tony will have interesting counterpoints. So I'm a technology fan boy, I have to admit, I am in all of all these new companies and how they have been able to rise up and handle extreme scale. In this time that we are speaking on this show, these food delivery companies would have probably handled tens of thousands of orders in minutes. So these concurrent orders, delivery, customer support, geospatial location intelligence, all of this has really become commonplace now. It used to be that, you know, large companies like Apple would be able to handle all of these supply chain issues, disruptions that we've been facing. But now in my opinion, I think we are seeing this in, Doug mentioned Rocket Mortgage. So we've seen it in FinTech and shopping apps. So we've seen the same scale and it's more than 5G. It includes things like... Even in the public cloud, we have much more efficient, better hardware, which can do like deep learning networks much more efficiently. So machine learning, a lot of natural language programming, being able to handle unstructured data. So in my opinion, it's quite phenomenal to see how technology has actually come to rescue and as, you know, billions of us have gone online over the last two years. >> Yeah, so, Doug, so Sanjeev's point, he's saying, basically, you ain't seen nothing yet. What are your thoughts here, your final thoughts. >> Well, yeah, I mean, there's some incredible technologies coming including 5G, but you know, it's only going to pave the cow path if the underlying app, if the underlying process is clunky. You have to modernize, take advantage of, you know, serverless scalability, autonomous optimization, advanced data science. There's lots of cutting edge capabilities out there today, but you know, lifting and shifting you got to get your hands dirty and actually modernize on that data front. I mentioned my research this year, I'm doing a lot of in depth looks at some of the analytical data platforms. You know, these lake houses we've had some conversations about that and helping companies to harness their data, to have a more personalized and predictive and proactive experience. So, you know, we're talking about the Snowflakes and Databricks and Googles and Teradata and Vertica and Yellowbrick and that's the research I'm focusing on this year. >> Yeah, your point about paving the cow path is right on, especially over the pandemic, a lot of the processes were unknown. But you saw this with RPA, paving the cow path only got you so far. And so, you know, great points there. Tony, you get the last word, bring us home. >> Well, I'll put it this way. I think there's a lot of hope in terms of that the new generation of developers that are coming in are a lot more savvy about things like data. And I think also the new generation of people in the business are realizing that we need to have data as a core competence. So I do have optimism there that the fact is, I think there is a much greater consciousness within both the business side and the technical. In the technology side, the organization of the importance of data and how to approach that. And so I'd like to just end on that note. >> Yeah, excellent. And I think you're right. Putting data at the core is critical data mesh I think very well describes the problem and (mumbles) credit lays out a solution, just the technology's not there yet, nor are the standards. Anyway, I want to thank the panelists here. Amazing. You guys are always so much fun to work with and love to have you back in the future. And thank you for joining today's broadcast brought to you by Couchbase. By the way, check out Couchbase on the road this summer at their application modernization summits, they're making up for two years of shut in and coming to you. So you got to go to couchbase.com/roadshow to find a city near you where you can meet face to face. In a moment. Ravi Mayuram, the chief technology officer of Couchbase will join me. You're watching theCUBE, the leader in high tech enterprise coverage. (bright music)

(upbeat music) >> We're back at VeamON 2022, at the Aria in Las Vegas. You're watching The Cube. My name is Dave Vellante, and I'm here with my co-host, David Nicholson. Danny Allan here is the Chief Technical Officer at Veeam. And he's joined by Ope Bakare who's the Chief Technical Officer at HBC Dave. One of the few companies that's older than my home. >> Unbelievable. >> Ope. >> That's right. >> Danny, great to see you. Thanks for coming on. It's true by the way. 1670, we're going to learn more about HBC. But I wonder, Danny, if you could set it up. The kind of topic of this discussion here is hybrid cloud, we've got a pretty interesting use case, give us the high level, what should we be focused on here? >> So lots of customers today focused on digital transformation and moving into the cloud, everyone talks about that, I can take my workload and move into the cloud. And one of the interesting things that we saw originally was, you know, I'll just lift it and move it over there. That's not necessarily the best model for the cloud. So you see people doing that. What I actually think is really interesting, and I know Ope has been very focused on is actually transforming the application so that works most effectively in the cloud model. >> So Ope, maybe give us the background on HBC, for folks who aren't familiar with the company and your role there. >> Sure, so HBC is 350, somewhat years old. It's the oldest corporation that's continually existed in North America. I have the privilege to serve as the chief technology officer there. And, you know, HBC is a company that has innovation kind of baked into its core DNA. We have to keep reinventing ourselves, otherwise, we get stagnant and we get left behind. Clearly, we're still around so--. >> So far so good. >> We must be doing something right. But kind of pivoting to what you were saying earlier, you know, our journey to the cloud was multifaceted. Some of it was to improve the pace of innovation, some of it was to improve on quality. So you know, we have typical data center technologies, and, you know, we had some of the typical issues you would have, right, so some older equipment, you know, failures, etc, etc. When you're in the cloud, a lot of that is just managed for you. Again, it's about what I talked about this morning, it's about moving your team up the value chain, towards creating value, right? So you start with the managing of core basic infrastructure, and you start consuming them as services. The interesting thing is, as you mentioned, for the vast majority of people, your first foray into the cloud, is pick up all those virtual machines that you had on-prem, and put them in the cloud. And that's great, you get, immediately you get a better, possibly a better or more available under a cloud platform there. But you're just barely scratching the surface. You don't really get into cloud until you start consuming cloud native services, until you go serverless, you go stateless with containers in Kubernetes, you can use platforms like, you know, Kafka for streaming your data, as opposed to, you know, constructing cumbersome, easy to break data pipelines and all that. So it's a very interesting pivot. And I think a lot of people sometimes struggle with going past that first step, they have the VMs, it's familiar to what they're used to. But for us, we had a digital transformation in the works. We were replatforming from a legacy platform, some of you may know, Blue Martini. But we were moving to a more modern, more flexible platform that was really suited to accelerate our omni channel strategy. Thank goodness we did because the pandemic came around and proved it exactly correct. >> Good timing. >> Yeah, so that's really what happened for us, that actually forced us forward in the cloud journey. >> So Alan Nance, who was at the time, he was like a CIO slash CTO at Philips. And he said to me, if you just lift and shift to the cloud, this is early days of cloud, he said, he's not going to change your operational model. The company, if you want to save billions, you got to change that operational model. But listening to what Ope just said, Danny, what does that mean, from your perspective, I mean, cloud native, and what does that do for your business? >> Well, cloud native,. The benefit of the cloud, of course, makes completely portable, and it's elastic, you can scale almost infinitely, and you don't have to build it. However, the hard part is not the technology. I always say the hard part is the process, you actually have to rewrite your applications to take advantage of all the things in the cloud. And that is not an easy thing. So what we're seeing a lot in the industry across our customer base, is when they have a greenfield opportunity, a new project, they always start in the cloud. We're not seeing a lot of, hey, am going to completely modernize my applications, because that's expensive. It's already built. And so customers will sometimes pick that up and move it to the cloud. And sometimes they'll actually move it back on premises, because the cost model isn't there. But I do think in the long term, if you're looking at four or five years, all the new applications will be designed for a cloud native experience. What that means is written in containers, with container orchestration, you know, seamlessly orchestrating the entire portfolio and data lifecycle. >> So Ope. >> Spot on. >> Translate that into what actually happened at HBC. So as Danny said, we're not going to just going to move everything into the cloud, we've got a hybrid setup, maybe some of the new stuff. What did you do? You have the, your back end systems, your database kind of protected that? How did you go about this omni channel journey? >> So, you know, for us, you know, by the way, that was completely spot on. You know, it's not a fallacy to really examine some cost, because we all have to, we'll have to live in the real world, right? We understand that there are budgets, and there are limits to what we can accomplish within a fiscal year. So you look at an application that's already built, that's already fulfilling the business purpose for which for which it was built. What's the value in immediately going and taking it all apart and containerizing it? If there is a small or easy lift, sure, it might be worth it. But if it's a major system that you have to rewrite, the ROI is just not there, right? So a lift and shift model in that scenario, kind of makes sense. But what you said earlier is exactly what we did. When we had an opportunity again, with the omni channel strategy, we're looking to strengthen our digital arm. And so we were moving from our legacy platform to this new one. And that required us to do a bunch of work. So we had to modernize some of our services, we had to change some of our data, our data process, how we stream data into and out of the e-commerce platform. And all of that actually provided sort of almost a groundswell of support for all of this transformative works. Apologies, for all this transformative work we had to do. So it totally made sense in that case, we actually were able to kill two birds with one stone, really transform and go cloud native, at the same time as deprecating a bunch of legacy technologies that to be perfectly frank didn't really have much of a place in the cloud. >> So many questions. I hope, go. >> Yeah, so it's interesting, because when you talk about that sort of journey to cloud that you're on, sometimes people will ask the question, well, how long before everything is in the cloud? And often the answer is, if you look at what's called the vanishing point, where the two sides of the highway come together, off in the distance, it's like, that's, that's when it'll happen. But as you get closer to that point, it gets further away. So if you had to categorize it in terms of a percentage of where you are now, and then an aspiration over time, how would you categorize that? >> So I have the pleasure of telling you that we are probably at about, I'd say 90% in the cloud? >> Oh, wow, okay. >> We were very aggressive about it. And frankly, I think, you know, first of all, I have the privilege to lead an amazing team. And they did everything possible to make this real. We had a goal, and it was focusing on our customers, being customer obsessed, really. And for us, data centers just didn't make sense in that world. So all we did was work towards how do we deprecate these legacy technologies? How do we consolidate and then move them to the cloud as quickly as possible? So for us 90%, and we're going even even further. Is that last 10% worth it, to go for that? I mean, you know, what's the, you know, you get to that marginal return? >> I really think the next 5% will be worth it, the last five we're not going to pursue and here's why. So think about, you know, we talked about really low latency things that need to be physically in the building. So we have a bunch of, we have a whole lot of fulfillment and distribution centers, right? Those, in some cases, we have automation equipment that really requires low latency connectivity to physical equipment. Moving that to the cloud, is not really a high value proposition. If you think about, you know, large corporate presences, there are some pieces of technology that you could move to the cloud. But again, latency in the customer, the users experience might be compromised as a result. If there's no value, really, to moving that into the cloud, why would you do it? >> And wouldn't you have to freeze the application in order to move it into the cloud or not for these 10% or 5%, or not necessarily? >> Not necessarily. In many cases, we have applications that are built in a distributed fashion so that you can take, you know, some percentage of it, move it to the cloud, validate it over there, and then move the rest of it-- >> You could build some kind of abstraction layer, okay. So the million dollar question is, what does Veeam have to do with all this? >> Well, so Veeam has been for quite some time now, our data protection engine. You know, when I talk about moving people up the value stack, I don't take that lightly. For me, you know, having engineers do things like and please forgive me for a second here, but do things like backups, to me that's, it's a hard requirement, but it's not really high value for me. So if I can get a platform that can use policies, can use tags can operate natively in the cloud. And once you have it running, you can set it and forget it, other than your periodic, you know, business continuity to DR Tests. You know, that's the dream scenario. And we've achieved that largely. We still have some legacy systems that are not on vignette. But that's something that's going to change over the next, let's call it 18 or so months. >> So did you evolve as Veeam evolved? How long have you been in this role? I apologize-- >> I've been with HBC for three years now. >> Okay, so now, Veeam goes, well, I remember I first saw Veeam at a VMUG. I'm like VMware, I was just brilliant, right? Of course, we all say that. Now, but you saw Veeam's ascendancy through virtualization, and then it took a while, but then all of a sudden, bare metal, the first in SAS, great cloud strategy. Now the first in I don't know if I can say that. Scratch that. We will talk to you about that tomorrow. Someone will come here. >> Someone else will come here. At VeeamON. So, from what you know, about HBC, did you kind of follow that Veeam strategy, they were just sort of there as you migrate it to the cloud, SAS, you know, Microsoft 365, etc? >> Yeah, so we actually started using Veeam in a very limited capacity quite some time ago, mostly to protect on-prem virtualized workloads. And that was, you know, that was really the limit. And, you know, my team had been used Veeam, in my previous role when I worked for a large healthcare provider, health care company in the states. So I was pretty familiar with Veeam as a platform, I was very familiar with the journey. I think that you know, more than many other, most of their competition, they've made the transition into the cloud first world, far more successfully. If you think about the policy engine, the automatic tearing, by age, as well as some of the cloud tagging, and the full integration with the native capabilities in AWS and Azure, it's been a dream scenario for us. >> You and I have talked about this Danny, and a lot of your competitors, especially early on the cloud, they wrap their stack in, you know, to container, or Kubernetes, it's shoved it in the cloud, which is really hosted on prem app. You guys didn't do that. I mean, I pushed you on this a number of times. What did you do? >> Every time there's a modern infrastructure, we say, how can we actually apply data protection, modern data protection to that infrastructure, specifically. We don't try and take what already exists. And Veeam started at this. If you think back when we first started, everyone was doing agents. And if you took an agent, put it on a hypervisor, and you'd 100 of them running at the same time, you would kill your production system. So we said, we'll take a snapshot at the hypervisor level. And then when storage arrays came up with snapshots, let's take advantage of that. When we went to the cloud, we said let's take advantage of the API's rather than trying to put an agent in there. And so every time we encounter a new infrastructure, we say, how do we take advantage of what that infrastructure is bringing? >> We're going to dig into more of this tomorrow. But I don't want to steal from the HBC story. Let me ask you about, you talked about, we talk a lot about digital transformation and modernization. And, of course, COVID was like a force march to digital, we all sort of realize this. What do you see Ope, that's now permanent? Whether it's, you know, security, data protection, and how you're thinking about modernization? What are those practices that are now best practices that will become permanent? >> Well, the obvious one that kind of hits up hits us all in the face is remote work. For the past, let's call it two ish years, my team has been almost completely remote. And as a result, you know, we've been able to show that, for us, it worked just fine. There were some teething pains as we all did >> It was like Y2K. Wasn't it? Hey, the world didn't end. >> It became a non factor very quickly, why? Because for most technology organizations were too used to working outside of normal hours. So it wasn't a stretch really to extend a logic to just working, you know, working remotely permanently. That said, you know, one of the things that for us, and I'm going to deviate away from the technology side for a second, one of the things that is really critical for us is we're trying to make sure that we respect people's work-life balance. As we have colleagues who work from home, you know, today, it's very easy to roll out of bed in the morning, you know, put your zoom suit on, and you know, where you're wearing your shorts, and all that and just work the whole day and then around like five to 7 P.M. or whatever, you sign off and you just realized, I just spent way more time working than I probably would have if I were going to the office. That's you know, it's a great productivity-- >> With no breaks. >> With no breaks, right? And there's no button, no water cooler moments or whatever. But, you know, we're trying to, we're trying to come up with various ways to respect people's, you know, work-life balance. Interestingly enough, we actually have a law that is going to effect in early June, in Ontario, where there will be a right to disconnect. So outside of normal working hours, you will be required to disconnect from your employees unless it is an operational issue, or some other pertinent emergency that requires them to engage. So, I think that's going to become the new norm as we go forward. Coming back to technology, I think just looking at the last two years, I don't know if you've noticed the same thing, but the pace of innovation seems to have picked up a tick. And I think that is going to become the new normal. You're going to see a lot of people challenging status quo a lot of sacred, a lot of sacred cows are going to get, you know, get, you know put out to pasture. And I think that's a good thing for our industry, it's going to quicken the pace of innovation. And it's also going to make people more thoughtful about where they place their bets, I think. You know, the other thing, this is the last one, dollars and cents. If you think about the pandemic, when it first started, we all had to take a breath, because instantly, a whole lot of industries just paused, right? And when that happened, you know, you had no revenue coming in. You had, it was whoa, what are we doing here? And I think that also sharpened our focus, when it came to making some some decisions. You know, we all had to deal with, you know, in some cases, furloughs and some cases reductions. Thankfully, we're all back to back to normal now. But where you place your bets financially, it's going to drive a lot of technology decision in investing, right? So I think that's going to be a larger part of our kind of landscape going forward. >> So that last point about innovation, Danny, it's got to be music to your ears, because your, the premise, you're saying, behind Veeam, is you look at the next trend and then modernize, you put meaning behind modern data protection. It's not just a tagline. You gave a couple of good examples. But talk a little bit more about, you know, what Ope just said and what that means to you guys? >> Well, at a technology level, I always talk about three things being part of modern data protection. One is, around the security, everyone working from home, there's intellectual property going into the home on the endpoint in Microsoft Teams, in all the collaboration tools, that needs to be protected. And actually, we're seeing because of the rise in ransomware, cyber insurance is actually requiring data protection for that. So a big part of modern data protection is all about the security of the environment. The second is cloud acceleration. We want customers to move to the cloud. I love sitting here quietly listening to him tell the story of what they're doing, because it's perfect. That is the story that we want from our customers moving to the cloud. And we don't want to stop that in any way. In fact, all of our licensing models go to market, support set cloud acceleration. And then the last thing is, of course, data protection. If they're going to do that, you own that data, you need to protect it on any cloud and on every cloud. And so our focus around modern data protection is those three things. Ransomware protection, cloud acceleration and modern data protection >> In an environment that is not bespoke, I presume, we're going to talk about Supercloud tomorrow. But right, but this idea that instead of going to, I don't know, if you run on Google, AWS, Azure, whatever, but instead of going there and doing your thing, and going over here and doing your on-prem, but you want a consistent experience across all your estates, whether it's on-prem and the cloud, eventually out to the edge, we're going to talk about that tomorrow, too. Is that a fair premise? >> It is. I mean, operational consistency is absolutely crucial for my team to succeed. I mean, think about running multiple different tools for data protection, it just creates a whole lot of interaction, let's call it that has friction. And ultimately, with anything and technology, wherever there's friction, you're going to have problems eventually, and you're going to have varying levels of skill in the team. Suppose you have part of your data protection team, you lose one or two people to COVID for a week, right? And you have a DR test. And it's so happens that these are the experts at FUBAR software, that is your data protection platform. The people that you may have on-prem, available may not have the right skills. I mean, unifying that stuff and actually running them out of the same ethos, really. I think that creates operational consistency that is so valuable for us to be successful. There was one thing I wanted to bring up, just hearing what you said earlier. Zero trust, I think is going to become part of our industry baseline as well. Zero trust approaches to network connectivity to tooling so that you stop dealing with traditional VPN. >> Tho nication >> Tho nication It just, that's where we're going as well. So apologies but-- >> No, not at all, it was a buzzword before the pandemic. >> It was but it's actually-- >> Now, it's a mandate. >> It's kind of, it's come back and become actually useful. >> If people are trying to, okay, what does this really mean? What does this mean to our organization? Exciting times, you know, the thing is, there's a lot of unknowns, right? And we certainly saw that with COVID. So how do you as a technologist deal with, you know, it used to be we would automate the known. This industry is built on that, right? How are you approaching what you don't know, from a technology, infrastructure and process standpoint? >> So I'm going to, everyone watching, everyone turn their videos off, when it's, I'm going to give them a secret, it's the people. The people are the secret sauce. If you surround yourself with amazing people, curious people, you can solve any problem. I again, like I said, I have the privilege of leading this team. And we have some amazing thinkers and problem solvers. If you set them to task and give them the right support as a leader, they will accomplish anything. And so for me, having a robust and just really diversely skilled team allows us to attack any problem, I have zero, I have zero worries about the future of state of technology, I have absolute confidence, we'll be able to engage, master and exploit whatever technologies come our way or any other challenges that actually happened to you know, be in our path as well. >> We hear this a lot in The Cube people process technology. Technology, figure itself out and get the good people you can get the right process and win. >> Absolutely. >> Ope, Danny, thanks so much for coming on The Cube. Danny, we'll see you tomorrow. Tomorrow afternoon Danny's coming back and we're going to dig into a lot of this stuff and double click on it. Appreciate your time. >> Absolutely. >> Thank you. >> This is Dave Vellante, for David Nicholson. You're watching The Cube's coverage VeamON 2022. From the Aria, in Las Vegas. This is day one. Keep it right there. (enchanting music)

>>Welcome back to the cubes coverage of Dell tech world 2022. My name is Dave Volante and I'm here in our cube studios in Massachusetts getting ready for the first in person DT w since 2019, you know, Charles Phillips, the CEO of Infor and former Oracle ex once set on the cube friends, don't let friends build data centers anymore. It's just not the best use of capital for most companies, unless you happen to be in the data center business like Sexter organizations wanna make hybrid connections to the cloud. They need a partner that knows how to build and manage world class data centers that are both efficient and resilient. And in this segment, we're gonna talk about the importance of hybrid strategies for organizations, how they're approaching hybrid and why a partner strategy is important to support the next decade of digital transformation initiatives. And with me are Randy Roland. Who's the COO of six Tara and Holland Barry, who is the field CTO for the company. Gentlemen, welcome to the cube. Thanks for coming on. >>Thank you. >>Good to meet her. Thanks for having us. >>Hey, Randy, as a relatively new player, unlike a lot of data center operators, Cera, you're not shackled by decades of technical debt. Tell us more about the company. >>Yeah. So as you, uh, already discussed Ceras a data center company, and we're one of the few that can provide colocation globally. And so that allows our customers to scale, uh, across the globe, as our business scales, we operate in 28 markets. We have over 60 data centers and we continue to add more dots to the map based on customer demand. And the primary way we differentiate is that we've built a true global data center platform. And what do I mean by that is that we have a combination of 2300 customers, uh, enterprises, technology, service providers, government agencies, we're a leader in interconnection. Uh, we have a commitment to carry neutrality and to provide low latency access to all the different cloud platforms. And we've made major investments in developing our own technology in house. And this will come out. As we talk about hybrid cloud is to make our data centers easier to consume. Uh, we live in a cloud first world, and so we've got to be able to be responsive and be able to deliver capacity on demand and to allow our customer members to dynamically connect to each other so they can start to consume these valuable services. And so that's really what we're doing at Cera. >>You know, Randy, just a follow up is because when the cloud first came out, everybody said, oh, companies like, like yours, Dana data center operations are toast. And the exact opposite happened. It was like this rising tide lifted all boats. The, the business is, is booming. It's, uh, it's actually quite room, isn't it? >>Yeah, actually it's a good point. We actually lean into, uh, cloud consumption. I think, uh, if you remember, the cloud operates in four walls. And so when a company, um, actually starts to deploy and leverage more, they need a place to land their digital infrastructure hub, where they can make connections to all the different cloud solutions they're gonna consume. And they're using their own internal resources at the same time. And so the more that we adopt cloud, um, and lean into cloud, the more likely our customer gonna choose us. And back to your opening comment about, uh, the, the quote from the Oracle executive in, in my career, I've been in the data center business for a long time and it, it's definitely a generational thing. We have newer generation of it leaders when they think about their internal data center, their actual internal data center is ours. They're thinking about their own four walls sitting on their own property like they did historically. And so, uh, they view internal data centers as the contracts they have, uh, with six companies like six. >>Excellent. All right, Holland, let's bring you into the conversation. What are you seeing with, with hybrid cloud strategies? You, why are companies choosing hybrid? Give us some color there. >>Yeah, I think, you know, we, as a company sit in an interesting confluence of some workload movements, if you will. Um, so I think there's been, in some cases, an overcorrection in the public cloud, people thought that a cloud first strategy meant that you have to throw everything up in a public cloud. Uh, especially over the last couple years when we had, you know, the surprise of a large remote workforce. And as you mentioned at the top of the call, Dave, we also have folks with the shrinking appetite to own and operate their data centers, right? So the hybrid approach is a, um, a selective methodology to really look at the applications, uh, look at the strengths of each one of those venues, where you can run your applications and workloads, and really choosing the one that uses the strengths. And there's several, uh, drivers behind that. Uh, some of them are cost. Some of them are performance. Some of them might have to do a security or data sovereignty. Um, so you can really match those requirements and those business outcomes that you're looking to achieve, uh, and align them with that platform. That's that's best suited to serve it. >>So you mentioned a few of 'em, but I wanna sort of stay on that for a minute. Is it, is it, you know, egress cost, everybody talks about that, you know, latency proximity to the cloud. I mean, I think there's a lot of times, I think the ideal situation is you put your high performance, you know, transaction low latency stuff in one of your data centers. And, you know, a lot of the data is, is in the cloud that you might need access to. But is there other innovation, you know, talk a little bit more about the drivers that you're seeing with customers? >>Absolutely. We, I think, um, as it relates to data gravity and the potential relation to egress charges, that is a huge, uh, consideration, cuz there's a cost and a performance component to that. If you decide you want to take that data and move somewhere else, if it's in the public cloud, you're gonna pay some, uh, pretty large egres fees, but there's certainly other drivers, um, performance being another big one. Uh, if I've got a, a data lake or, or a big data analytics platform or maybe an AI platform that needs to live close to the data. Um, and especially if those workloads that are associated with crunching, the data are kind of high steady state, maybe even mission critical workloads that is certainly a workload profile. That's better suited to run within our four walls. You can have those CPU or GPU comput nodes sitting right next to those large data sets, operating with each other at land speed. Um, so in terms of the drivers behind, uh, making a, a venue change, if you will, I think cost is one of the biggest ones that we see and, and maybe performance and security following close after. >>So, so how are customers approaching hybrid? Can you paint a picture of kinda what that connection looks like and how, how they, you know, land on their strategies? >>Yeah, absolutely. So they're doing, uh, what I like to call a workload appropriateness, uh, exercise. And as they think about recalibrating where those workloads live, exactly what I said before, they're looking at the strengths of the platform and, uh, lining up those application profiles to live in, in the appropriate place. We have a unique advantage, uh, because of our interconnection profile and our adjacency to public cloud platforms, where if people want to have application tiers that may be sent on both sides of the fence, if you will, uh, we have super, super low latency connections. You can connect, you know, layer two, uh, maybe out to AWS, um, and, you know, have your VPC on one side, have, uh, you know, dedicated single tenant environments on our side and have those applications interact with each other. And then in a super low latency fashion, >>Hey, lemme just ask a follow up question on that. Because I remember the Y2K days, there was a, a lot of activity, a lot of spending and then CIOs wanted to look at their portfolio and, and rationalize that portfolio. When you talk about workload appropriateness, are you seeing a similar application rationalization exercise going on or is it just a Hey can spending, >>Uh, absolutely. We're seeing rationalization and I think what's happening is folks are getting a little more savvy about forecasting, the growth of their application, uh, the growth of the data associated with it, what the cost may be associated with needing to move them around to different venues. Um, and so we're, we're definitely seeing people look at those numbers and make decisions about workload placement based on that analytics and, and kind of knowledge of what it means down the road and also where the data might need to live locally too. We're seeing people, uh, being a little more cognizant geographically around data where it lives and how that relates to where the computer associated with that data is. >>Yeah. Hey Randy, can you tell us a little bit more from a business perspective about the Dell partnership? How did that come about, you know, who does, what, what are the swim lanes overlaps? Maybe you can help us understand that. >>Yeah, so we're very excited about, uh, our Dell partnership, as you can imagine, with as many customers and many data centers, as we've got deployed, we have Dell, uh, located it in a large percentage of our customer environments. And so it's just natural that we work together to figure out how we can continue to meet, uh, our customer's needs. And so the core idea that I'm excited about around Dell is that Dell has an excellent technology platform in all fronts, they've got great compute and storage and all types of software solutions. And what we want to do is help them make their platform more on demand. And so what do I mean by that? If you think about the historical, uh, time, it takes to deploy a traditional colo environment from the time you spec the cage, do you ship the equipment, you install the network, you rack and stack the equipment, unload the cloud stack. >>It takes weeks to months to deploy. And so what we're doing is working very closely with Dell to look at our existing customers and new prospects that are interested in their platform and how can we pre-provision that capacity in, in the data center make it so it's already plugged into the data center already is powered up. It's connected to the network and a customer can purchase it on demand. And so the idea behind this is how can we give our customers all the benefits of Kolo, which is what, uh, Holland was talking about a minute ago, but deliver that platform at the speed of cloud. And that's really the essence of the partnership we have with Dell. Uh, we think it could be explosive. Uh, we think there's a lot of opportunity, not only, uh, for us, but also for Dell as they continue to retain their customers and their customers go through tech refresh cycles, if they can have on demand technology that they're already familiar with, they can get the benefits that you get from co-location at the speed of cloud. And that that's what our, the, the basis of our, our relationship. >>Yeah. Thank you. So Holland, I mean, Randy was saying one of the pillars of Dell tech world this year is the whole as a service thrust. And, you know, essentially what it is, my, my viewpoint is Dell's building out its own cloud. That's, you know, it's, it's its aspiration I think, is to connect on-prem to, through hybrid, to public clouds across clouds, out to the edge extract that all that complexity and you guys would be a key part of that from a, from a CTO's perspective, that's a different mindset. I mean, it changes the way we manage, think about procure, you know, spend, uh, um, and, and maybe that even the technical configurations of, of how we deliver and consume it, you give us some thoughts on that. >>Absolutely. Look, I think what we're doing is we're laying the foundation for a truly hybrid experience. Um, Randy mentioned, uh, us going through great lengths with our technology partners like Dell and make the data center consumable in an automated fashion. And so as we increasingly move into technologies like containers and using coordinators managers like Kubernetes, we really now have the ability to make a true hybrid experience. And if you think about the experience of deploying, you know, in a data center, whether it's your own or a co like ours, that was, you know, a 60 to 90 day conversation to, to get that infrastructure spun up. And so now if you can consume public cloud resources, just like we've been used to doing where you can swipe a card and get access to infrastructure in a matter of minutes or hours have the same experience with us, we've kind of closed that last mile of infrastructure delivery. And the other neat thing about this is, uh, if you have a cloud first mandate, if some of those workloads are running a ter data center, uh, we check all those same boxes, right? Uh, we, we have infrastructure that sits off X. We have a global platform. Uh, we have, you know, highly automated environment. So you can really now start extracting yourself a little bit from the infrastructure and start focusing on the important stuff, which the applications that sit on top. >>So from a security standpoint, you have a similar, you know, the cloud guys talk about the shared responsibility model. Is that a similar model that, that you guys have? Can you describe that? >>Yeah, it's, it's, it's very analogous to this shared responsibility model and, and public cloud. We give a little bit more control to our customers, like things like, you know, dictate maintenance windows. Um, we give a little bit more control in terms of access to the infrastructure. Uh, it's one of the reasons that organizations like running infrastructure with us is because we can hand off control to these certain things that the lower levels of the infrastructure stack versus that higher level of abstraction that happens with public cloud. >>And what, what kind of skills are you after, uh, these days? Is it people that can squeeze, you know, more power and, you know, more efficient cooling, uh, is it infrastructure management? You mentioned Kubernetes before. What, what matters to a company like yours from a skill standpoint? >>Yeah. And to terms of our staff, it is at the lower, uh, levels of the stack, if you will. So maybe going, you know, up to, uh, layer two or three, if we think about the OSI model. So certainly power engineering, cooling engineering, the stuff that physically runs our, our data center, that's our meat and potatoes. That's important to us, but as you consider our digital platform, um, certainly the networking, uh, know how knowledge of the entire stack, knowing how things are architected, understanding how cloud works, how understanding how cloud connectivity works. These are all super, super important skill sets. So we span the spectrum a bit. Um, but it's less on the upper ends of it, you know, kind of going up to layer seven, >>Although I'd imagine that data center automation is obviously a big part of your, your IP, right. Is that something that you have guys bring to the table? Yes. >>Yeah, it's actually one of our key innovations is around how we've architected our software platform, how we do our automation, uh, how we run our network. Uh, we we've, uh, built a, a super, super innovative SDN fabric that powers all of our Metro regions that enables the delivery, the infrastructure that hangs off of it. Um, so yeah, a huge percentage of our I P is around that software innovation and, uh, networking automation. >>Great. Randy, I wonder if you could close it out for us. Uh, I'd love your thoughts on where you'd like to see the Dell partnership go and any other, you know, information you'd like to leave the audience with. >>Yeah. I think you've asked a couple questions about the perspective from a CTO and the way that we want to build our solutions is if you are a CTO or if you're a cloud architect, what we are trying to build is a set of Legos to allow you to assemble your ultimate hybrid it solution to use a combination of traditional colocation, where you have equipment that you own, that you manage on demand, bare metal from great partnerships, like where we have with Dell, that can augment what you have in colo have access to a rich ecosystem of technology providers that sit in the same data center markets so that you can start to, to actually augment your it architecture with a lot of our, um, uh, solution providers that sit within our, our, our markets access to cloud OnRamp. So you get low latency access to public cloud to start to leverage some of the technologies they have, and also have the ability to switch, right? If you start with one cloud cloud provider, and at some point you find something more cost efficient, or a little bit more architecturally, uh, built that we can, uh, uh, facilitate that switch. And then also to have connectivity to all the different network carriers that we have. And so, and, and also to do it globally, right? And so our mission is to give the CTO and the cloud architect, the ultimate Legos, uh, to build their custom solution, it's highly, um, cost effective and meets all the technology requirements. >>Yeah. Hedging that risk and having exit strategies, I think is huge. Every, every customer needs to think about that, uh, before they, they dive into the cloud. Okay, guys, we gotta leave it there. Thanks so much for coming in the cube. Great discussion. >>Thank you. Thanks for having us. >>And thank you for watching our ongoing coverage of Dell technologies, world 2022, the in-person live version where we insert great deep dive interviews like this one that focus on key customer topics. Keep it right there. You're watching the cube.

>> "theCUBE," presents Dell Technologies World, brought to you by Dell. >> Hey, welcome back to "theCUBE's" live coverage of Dell Technologies World 2022. Live from the Venetian in Las Vegas, Lisa Martin, Dave Vellante joins me. Dan O'Brien joins us next. The senior vice president of technology solutions at Presidio. Dan, welcome to "theCUBE." >> It's great to be here. Great to be in Vegas too. >> Is it great to be back live in person, three dimensional? >> You have no idea. >> Oh, I know. >> Yeah. >> Just the seeing people again and the vibe here day-one is already fantastic. >> Yeah. >> Talk to us about Presidio and Dell's relationship? What's going on with Presidio? >> Yeah, so I'll tell you just Presidio as as a whole, and part of why I joined about a year ago and I'm still just excited as I was on day one. We're a digital services and solutions provider with deep engineering expertise in networking, cloud, security, collaboration, and modern technologies. And we'll help our customers acquire, deploy, and then operate and manage the solutions that we have. So, we're a Dell titanium black partner. We just got that, we're a super excited about it. And they're a critical part of how we deliver solutions to our customers. >> So, you joined during an interesting time during the pandemic. What are some of the challenges your customers are facing now? Aging infrastructure, labor shortages, supply chain. What do you, what are you seeing from the customers lens? >> Yeah, you know, all of the above. I think when the pandemic first hit, every customer that we spoke with basically said, Cash is king. We want to preserve it, we don't know what the future holds. So, all of the spend that happened was on the things that drove their business forward. So, I got a distributed workforce. How do I go invest in technology to make them productive? A lot of them had to take a digital agenda that was five years long and do it in three months to survive, so they spent it and that generally meant cloud. But what they didn't spend money on, was infrastructure inside the data center. And now what they're finding, is things are old, maintenance bills are going up, the cost to get it is going up. And sometimes supply chain is over 12 months long to be able to actually do something about it. >> You know, when "theCUBE" first started in 2010, it was EFC World 2010 now, 'cause Dell is really our legacy here. So, we said that companies that sell, it's kind of a pejorative, but sell boxes are going to be in trouble because of the cloud. Interesting, right? So, it was partly true because the cloud just intermediated a lot of that sort of box selling business. We said they have to become more value added players, identify. And so, when I watched Presidio, the transformation that you guys went through, and you're relatively new. Cloud has actually become an opportunity. And you're doing stuff around digital, a lot of stuff around security. It's cyber, probably automation, life cycle management. >> True. >> Talk about that transformation? And I'm interested in why you joined Presidio? >> So, I'll tell you why I joined Presidio, is I was talking to a lot of customers every day in my old role, I love doing that part. And the conversation started with, "Dan, I can't spend money on my data center right now because we're in a pandemic. I've got to innovate faster and the answer is to cloud. I don't know how to actually make my workforce productive because they're all over the place now. And we didn't invest in technology. And now I've got a threat surface with people working everywhere in workloads in different places. I don't know how to approach that." And I looked at what Presidio had built, I'm like, that's exactly what we did. But what's been fun for me, has been the answer to most of our customers is this the end? It's not the public cloud, it's not the private cloud. It's, you need to do both of them really well and have the skills and expertise to leverage 'em for the right application, or workload, or use case. And that's why I'm super excited to be here, 'cause we're really helping our customers in both areas. >> You mentioned security. We've seen a number of announcements today from Dell Technologies with respect to cybersecurity. We know the stats are what they are. It's no longer a matter of, if we're going to get hit by a cyber attack, it's when? Most organizations are going to get hit by 2025. Where is security in the conversation now? How high up in the priority is it? >> I would say it's, we don't have a single customer meeting without having that conversation. And what we're finding, is you look at the stats that say, you know, 30% of companies that have a cyber attack, don't come back from it. 20% pay the ransom, and then they don't even get their data back. So, while we want to stop the attacks, I think you're right on that the answer is, it's not a matter of if, it's a matter of when? But what's great about Dell Technologies, is we have a complete portfolio that can meet any SLA of our customers. It's in backup technology, it's in primary storage, they can do a mutable backups and recoveries everywhere. But what happened this week, where they announced partnerships with the cloud, that's huge because the same resource constraints that customers have in their data centers today, are the same ones you have to deploy infrastructure to be able to make this work and be able to accelerate recovery. So, the partnership and the integration with the public cloud, really gives a great integration point for a lot of our customers. >> At the analyst of the event today, we had a meeting with Jen Felch, the CIO of Dell. And I said to her, you know, our survey data from ETR shows that security now, number one priority, it kind of always was, but it's distance itself from the number two, which is cloud migration. And I asked her, I said, "Obviously, cloud migration is not your number two, 'cause number security number one was number two?" And she said, "Let me help you interpret that data. Because for us, we have the scale, we can do our own cloud essentially." What her interpretation, was what those customers are really saying is modernization. Now, you must see that. Now, of course, you're leaning into cloud. Dell is not defensive really more about cloud, like, hey, we could take advantage of it as well. So, what are you seeing in terms of the changing priorities of IT kind of pre-post pandemic? Is it like a rubber band that goes and then comes back to where it was, or is it kind of permanent? >> I think that the both worlds together are absolutely permanent. And there's no way we're going to go back from one or the other. And then we're always going to have a world where you might lean more into one. To innovate, you might lean more into one for disaster recovery. But I truly think the world and the answer for us and our perspective, has to be both. But you said something to interesting earlier, is the key I think to what customers are doing is you can't just pick up a workload and move it to the cloud, it doesn't solve a problem. You use that term modernize. And we've invested, acquisitions and continued engineering resources that were hiring around modernization because the economics and the true benefit of actually running a workload and running right at the right SLAs and meeting your customer's objectives, aren't going to work right if you're just picking an application up and moving it over there. So, we're really focused there. >> So, Couch Base, just ran a survey. We did a power panel on it with a bunch of database analysts. And it was a survey of 650 CIOs and CTOs. And it was really interesting 'cause it's an IT bias. But they said like 2/3 of the survey base said that IT is responsible for setting the digital transformation strategy of the company. And I went, "Well, I wonder what the business guys say to that. It was sort of a red flag to me. But I wonder what you're seeing 'cause there's obviously you get a difference when you talk to different worlds. So, I guess what is modernization, was kind of one of the big questions that came out of it? And who's driving the agenda? >> So, it really depends upon the customer, right? But the key to what you said, and there was an article that came out. I won't say where it was from, but it really kind of opened my eyes. But the article was titled that, "It's Time To Get Rid of the IT Department." And for someone like me and a lot of customers, that kind of scares people. But the whole underpin of it, was they were studying customers that took IT and actually disparaged, like broke 'em apart and put them into business units. So, it said, it's your turn to wake up every day and figure out what that business unit needs to be successful. Because the answer is, David, it's both, right? You need both parties on board, right? Where, you've got a business stakeholder that clearly knows want to do, understands technology's the answer but you need IT to be able to go make it work and be a true partner, and help go actually make it work. >> It reminds me of when Nicholas Carr wrote that article if you're, you guys are probably too young to remember, "But Does IT Matter?" It was kind of post Y2K, right? And then everybody went crazy. All the CIO was when nuts. And in fact, IT matters more than ever, but it's a different context, as you're saying. A question on things like skill shortages, supply chain, I mean, obviously, top of mind. >> Yeah. >> Are you helping people with that? And if so, how so? >> Yeah, so two ways I would look at this, is when you look at the supply chain, I mean, Intel I think spent a $100 million on standing up new Silicon plants. We won't see a benefit from that from 2025. So, it's real. So, a lot of what we're doing on a supply chain is how can we help a customer reach in and have certain targeted ways to leverage the cloud? Because we can't physically solve for the physics issue. The other part of it, the people shortage. I mean, it's real. I mean, everyone's sitting at home they're pondering whether or not, you know, what they're doing is fulfilling their dreams. Now, geography doesn't matter, you can do a job from anywhere. And technology is the heart of everything. So, the people shortage is real. So, we're finding that our focus on managed services we're essentially allowing our customers to run and deploy things across every technology aspect, is something that we used to have to drive to our customers. And now, we can't get out of a conversation without them asking for it 'cause they just don't have the people- >> Yeah, they're calling you into that need. >> Yeah. >> Can you share that customer example that you think really articulates the value of the Dell Technologies that Presidio is delivering? It's really been able to truly modernize in the last couple of years? >> Yeah, so looking specifically to Dell, I mean, for us, one of the taking technical data out of the data center and modernizing, their HCI portfolio together with VMware, is a complete home run. It takes multiple products, brings it into a single common solution, uses a common tool set for all the operators that are there so you don't need the number of people to run it. But if you do it right, it solves for the portability issue in some of the public cloud options, especially with things like VMC where you can have an on and off-prem and an automation between 'em, so you can pick and choose dynamically. That for us has been a home run in driving modernization strategies. >> From a multi-cloud perspective, it's going to be a big focus of this event the next couple of days. What are you seeing from customers' perspective? They're probably in multi-cloud environments for a variety of reasons, that's going to be persisting. The hyperscalers are all growing. What's going on there? How are you helping customers to manage the multi-cloud environment with just much more simplicity? >> Yeah, so I think there's a couple parts to that, right? I mean, obviously, Dell together with VMware has a great set of technologies to be able to manage the deployment of that. But what we're trying to do, is number one, help a customer determine which workload should be running in which place, right? Understand application dependencies. But as we work through a migration strategy with a lot of our customers, the key part that a lot of people don't realize, is we all think security but the networking is probably the hardest part if you want to have portability in a well running cloud. So, having years and years in network heritage, it's been a great synergy on us kind of moving in that direction to help our cloud customers make sure that the right SLA, the right connectivity, and the right availability to make that world work. >> Yeah, so multicloud, obviously, a big topic of of discussion this morning with Chuck Whitten. And that's another one of those, well, what do you mean by that? I have a sort of a premise I want to test on you, Dan. I've always said, it just comes from talking to customers, multi-cloud is kind of multi-vendor. I got to run some workloads in AWS, I run some On Prem. I run some in Google, some in Azure, and many of them, a handful like the big banks, for instance, they say, "Well we're building our own abstraction layer so we can control the policies, the security." And it seems like that's a direction that the industry generally in Dell specifically is headed. Do you buy that? And what's driving that need? >> Yeah, so I would buy it based on the size of the customer. So, when you take a big bank, a lot of what drives them to go to one cloud or the other, is that the big cloud providers they're innovating constantly. Every day there's a new tool or capability that exists there. And certain ones of them are going to match, a use case that, that large customer has- >> You can't resist? >> So, they're going to end up with multiple clouds, so it makes perfect sense. When you get into smaller customer, they really have to want to be successful. They got to pick one, right? They can't afford the people, and the scale, and the process. So, I think that's... The answer would depend based on the customer. The larger ones, I think they're going to build a full orchestration stack and small customers are going to look for one and someone maybe with managed services to help them augment the skills and staffing to make it work. >> For a while, I haven't heard it much lately, but you'd hear about repatriation, people come to me like, "Dave, you got to look into this repatriation thing." And I did, and I was like, "Eh, I really see, it a little bit, little pockets." But I do see hybrid. I mean, that's very clear. And I do see a lot of people went into the cloud, they didn't have a great experience. And okay, so there's some of that going on. I guess you could call that repatriation. But what are you seeing in terms of both of those? Is repatriation a trend or is it really an hybrid? >> So, I've interesting perspective coming from Dell, right? Where we're a very infrastructure focused in there. I see a little bit of repatriation in like a workload, like virtual desktops where you picked it up and you threw it in the cloud and make your workforce productive. But generally speaking, what we're seeing is not repatriation, which is, "Hey I move things. My cost is out of control, I don't know how to manage it. Can you help me get better controls on cost? Can you help me automate a lot of the things that are running here so I've got better control of cost and we're where things are running in my security posture?" So, it's much more about optimization that we're finding than it is. Let's bring it back. >> So, it's fine tuning the knobs? >> There you go. >> Right? And that seems to be the trend over the next couple of years? >> 110%. Yeah. >> Excellent. >> Have you seen any industries, in particular the last year that you've been with Presidio really leading edge in terms of modernization? >> Yeah. I mean, it's so interesting enough. I mean, I could give you a few examples, right? When we look in our public sector business, a lot of the educational institutions had to invest in new platforms they interact and engage with students. Our financial institutions, believe it or not, continue to innovate. I mean, what people don't realize, is the mainframe still has the transaction where your money lives in the ledger, but all the supporting ecosystem is digitalized and is completely modernized to interact with you. And, of course, retail for us. I mean, retail, they had to change their business model in many cases overnight, not even to survive, but to serve the communities they were working in. >> Yeah, I think one of the things that we've all learned in the last couple of years, is just the access, the e-commerce, the access online. We expect that now in the brick and mortar stores to be able to deliver that connected store, make sure that they have the inventory that I'm looking for with a frictionless experience. >> Yeah, and I tell you my favorite one, is you look at the healthcare industry, and while obviously with loans, and healthcare, and billing, all had to change. But that was really exciting for us, I mean, as consumers, right? Is the fact that we can interact with doctors online at the click of a button now. I mean, that part for us has been super exciting. >> Everything's at the click of the button now. >> Yeah. >> Oh, my gosh. Well, Dan, thank you so much for joining Dave and me on the program today, sharing what's new with Presidio, what you guys are doing together with Dell, and how you're helping companies in every industry to modernize. >> Perfect. I appreciate it. >> Great to have you. >> Likewise. >> Thank you. >> With Dave Vellante, I'm Lisa Martin, and you're watching "theCUBE's" coverage of Dell Technologies World live from the Venetian in Las Vegas. Stick around, and Dave and I will be right back with our next guest. (bright upbeat music)

(gentle music) >> Hello everyone, and welcome back to day two of AWS re:Invent 2021, theCUBE's continuous coverage. My name is Dave Vellante, I'm here with my co-host, David Nicholson. We've got two sets. We had two remote sets prior to the show. We're running all kinds of activities and we've got AWS executives, partners, ecosystem technologists, Scott Weber is here as the director and an AWS partner, ambassador from PwC. Scott, good to see you. >> Nice to meet you guys. Thanks for letting me be here. >> Well, so your expertise is around application modernization. It's a hot theme these days. If you're a company with a lot of legacy debt, you've got a big complex application portfolio. I would think, especially with the forced match to digital over the last year and a half, two years. Now is really a time when you're probably too late to really start thinking about rationalizing your portfolio. What are you seeing in this space? >> Definitely, we're seeing the customers that have reached that point. I view modernization as sort of the second wave of cloud that's coming. So you had your first wave, the early adopters that lifted and shifted into the cloud. We still have people looking at getting into the cloud, but for those that went early, now, they're saying, "How do I get more out of the cloud? How do I get closer to cloud native?" And that's what we're starting to see around this modernization move is, I want to start to utilize those higher level services from AWS and the cloud providers. I want to get a better return, I want to stop worrying about running infrastructure and hardware. >> So when you think about, I go back all the way back to Y2K, that was like a boondoggle for IT to spend a bunch of doh and do some cool stuff. And then of course the .com crashed, but today it's different. It's really about the business impact the business outcome that you can drive in transforming your digital business. So how do you as a technology agnostic consultant help a company understand what they should leave alone or sunset? What they should aggressively migrate? What's the process that you use to do that? >> In some ways we go back, we can reuse sort of those 6Rs that maybe got a customer to the cloud, or as they're on that cloud journey, right? And you really want to focus on where can you optimize ROI. And you're going to come across those things that are going to be like, look, maybe it's a vendor COTS solution. There's not a lot we can do there. You're just going to have to continue down that path. Unless we can look to move that to a SaaS service. Maybe the vendor has gone to a SaaS offering. Or we get into looking at they've done development in house, but that development is still monolithic running on virtual machines, either in the data center or in AWS, but it's a critical system to that business. It's maybe it's become fragile. How can we now modernize that? Because that's where there's going to be a great return on investment for that customer, and it's also going to allow business agility for those customers. As we can get them to microservices and Lambda and function as a service, the blast radius for changes become smaller, allows the customer to move faster than what they're doing. So it's the rationalization becomes what's driving the business forward? What's critical to the business? But what's holding them back as well? So that the customers can start to move faster. >> So it's a formula of okay, what's the business value of those applications essentially? You can kind of rank that, but then it's a formula there's a cost equation. That's pretty straightforward to figure out the s is and the 2b but then there's a speed. Like an ongoing time to value from a developer standpoint and then I guess there's risk. Have you got your core jewels? Maybe you don't want to touch those yet. Is that kind of your algorithm? >> It is and on that sort of cost and value piece, that's where we can really see some interesting things happen, where as we get customers away from licensed OSS proprietary databases, that return on investment can be huge. So we've helped customers migrate from running .net applications on top of a typical Microsoft Windows stack and SQL server stack. All the way to taking those workloads, all the way, either to Linux containers or all the way to serverless if we're going to take all the steps to rewrite, you can drive 60, 70, 80% of the cost of operating at that platform out of it, then you start this flywheel effect of reinvesting that money back into the next project to help the customer move forward. >> And it's quick follow up, but I know you want to jump in. >> Yeah, yeah. >> Why wouldn't a customer, that's a Microsoft customer just run that on Azure? Why AWS? >> I mean, that's a good question and that sort of gets into a lot of philosophical, like discussion we talk about for a long time. The fact of the matter is the majority of your Windows workloads still run on top of AWS today. I would argue AWS has some pretty superior things in their underlying architecture, they're nitro architectures and things like that. But I think it's also choice. And, the whole move of .net to Linux, Microsoft started that they put the ability to, you can run SQL server on top of Linux. Well, if I run SQL server on top of Linux, I take out 20% of my costs right there. They put the support in for .net core to be able to run on Linux or on containers, but that's to help the developers move faster, that's to help us get to microservices. So that cloud provider choice, I think is becomes a bigger discussion, but a lot of people are choosing AWS because they're not just doing Microsoft workloads . Again, we could get very deep into like, trade-offs on why one over the other, but customers are choosing AWS for a lot of these words. >> Diversity and better cloud, better infrastructure. >> Yeah, and philosophical is an interesting way to look at it when it becomes a hostage negotiation. I'm not sure there was a lot of philosophy involved when server and SQL 2008 were being end of support life. And people were told, move it to Azure and we'll take care of you. Don't move it to Azure, you're on your own. But something on the subject of ROI. ROI is typically measured over time. How do you rectify and address the sort of CIO dilemma, which is that if ROI is being delivered fantastically in four years, but the average tenure of a CIO is 2.7 years, how do you address that? What is the sweet spot for timeframes that you're seeing for people to actually implement when you consider as was mentioned today, the keynote that somewhere around 15% of IT spend is in cloud today, which leaves 85% of it on premises. So what do we do about that? >> Yeah, that's a great question. So, I think, I like to get small wins. So find a very big pain point for that customer. How can we start to get them some small wins and start that flywheel effect going of like you saved money here, now, can we reinvest and start to show some wins, but we've engaged in projects where we've completely rewritten a whole application stack that was the core service for a business in a year and a half, and we took them from a run rate of somewhere between 40 and $60,000 a month. Had they been running that in AWS, they were running it in a data center today. So that was our estimate to less than $5,000 a month to run that application on a serverless platform inside of AWS. >> So when you talk about modernizing an application environment, that's typically not thought of as low hanging fruit. So does that mean that all the low hanging fruit has been consumed? Are all the net new things that are developed in a cloud native format, have they already been done? Is this the only frontier for opportunity now? >> No, it's not the only frontier. I mean, there's a lot of customers that are still just trying to get into the cloud. >> Lots of applications out there? >> Yeah, and you look at things like mainframe as well. That's I think a coming area where customers are finally starting to say, "Enough with the mainframe, we saw it in the keynote today of a new sort of service offering around helping customers rationalize how to do, to start to do things with the mainframe." So, but sometimes you can get those easy wins. Like we find a scalability issue. And we can inject scalability and pull back costs very rapidly. 'Cause you run in that scenario, there provision for max capacity that may happen 10% of the year. Now they're vastly overpaying. So we can still get some easy wins with slight tweaks to the platform while we help them rationalize those longer built times. I think the other thing we're starting to see is a shift in CIOs that are coming more from a software background too. That aren't from the pure infrastructure background and as we see those software dBase CIO start to come in. They're starting to understand the game that can be had of making the investment in the software and those upgrades to the software. >> And their tenure is elongating 'cause, CIO career is over was the joke. Now you're losing CIO, is cause they're going onto a bigger and better. They getting more options. I mean, they're becoming rockstars again. I want to ask you just as a side about that mainframe compatible runtime that they announced 'cause it sounds like you've got some experience in converting mainframe. >> Yeah. >> 'Cause I've always been a skeptic. We've seen this movie before where people have to freeze code, they've got to freeze code for 18 months. It takes 24 months, but now it's cloud, Adam Selipsky said, we can cut migration time, which is critical here by two-thirds 'cause that's the key. If you can reduce the time of which you have to freeze the code or maybe not even freeze the code. Again, I'm a skeptic, but what are you seeing with practical experience? >> So at PwC, we're seeing a lot of customers, start down this path and the ROI is pretty amazing when once you get in and you really start to dig in of what it can be if to go down this path. And there's a lot of tools out there, there's a gentleman on our team that's a real genius with this and he's helped multiple customers go down this path. There's tools that can start to do code conversion for you. I mean, we all get a little skeptical on those things cause we never know what the machine is going to try to make the code look like, but it's the starting point. But there is more. >> Like a prewash? >> Yeah, (Dave laughs) there's more and more design patterns coming out to help us down those pathways. But it goes back to agility for the business cause a lot of these customers running mainframes today are looking at a six month release cycle if they want to make any changes to their environment. If we can get them into an agile mindset to a microservice, they can get to two weeks or less for release cycles. So it's a big win for the company overall. Yes, there's a risk, but I think you can take, you can try to de-risk it as much as you can, you don't take the core, the absolute core critical piece of that mainframe. You start to pick away around the edges and you get comfortable with what you're doing. >> And going back to the concept of ROI, specifically in the mainframe space, there have been some not so subtle nudges from the marketplace that changed the dynamics associated with staying on your mainframe. Because if I tell you that the tax to stay on your mainframe is going to triple or quadruple over the next several years, that changes the balance. So you have the old guard in the software business who will remain nameless, jacking up the prices because they feel like, you know what, "What are you going to do? What are you going to do other than write me a cheque?" And the answer is, "Well move," right?. >> Yep, it's reached a point like the companies are moving. And what I think companies start to see too is, when we talk about purpose-driven databases, Adam was talking about that in the keynote today too. And we've seen that with customers when we've done builds, what's the right database for this data? And now you can start to get things moving even faster. And you unleash new ways of thinking. And I mean, some of the vendors are doing things like that and the companies aren't happy about it. >> Well, yes, but look, you're talking about Oracle in particular. (group chattering) That's one of them, but Oracle invests in its database and it's two different theories. Adam, today's the right tool for the right job, API and primitives and Oracle takes the kind of Swiss army knife approach. But they do invest if you have hard core mission critical, recovery is everything. There's a risk factor involved there, but if you want to go fast and you're a developer, you're not going to necessarily knock on Oracle's door, you're going to go to get an AWS. But it gets to my question, having done a lot of TCO analysis, it used to be labor, was always two-thirds of the cost. Now with automation, especially in Oracle environments, software license costs are the dominant component and it's maybe less true for SQL server, certainly true for Db2. I remember the early days of the flash, we used to tell customers, install flash. You're going to be able to consolidate, reduce your Oracle licenses when they come up. So that was a preferred strategy, but what are you seeing in terms of the ability? First of all is that a correct premise that software licenses is still a big component or an increasingly large component, and how do you unshackle from that? >> Yeah, so definitely software licensing costs for the OSS and for the databases are huge. I mean, there's numbers out there that like for SQL server enterprise, if you can get somebody off the SQL server enterprise and get them to an open solution like Aurora Postgres or something like that, it's a 90% ROI, and the numbers are similar for Oracle. And I talked to a lot of customers are like, "But we don't know Postgres," but it's not really that different. It's still data modeling. And when you get to these managed services platforms like RDS and Aurora, you free up those DBS to do the higher value things. The ROI of a DBA is not managing memory and desk and babysitting the servers, it's helping the developers build better data models. And those sorts of things that are higher value. So it is a big thing and we're seeing customers saying like, "Help us reduce this licensing cost," and help us be more efficient because the open platforms now, especially in the relational database area, are on par in a lot of ways with the Oracles and the SQL servers. So then you start to say, "Well, what am I gaining by paying and being sort of held hostage to these numbers?" So we definitely see customers making this transition. >> I mean, the point about Postgres is a good one because you're going to get enterprise class recoverability but even EDB would say okay, don't start with your mission critical core, pick around the edges just what he's saying over and over time, you're going to become more cloud native and get to the point, can you get to that point where everything's cloud native, everything is a service, maybe not a 100%, but a large part of your application portfolio can get there, right? >> Yeah, you're going to find those, that goes back to doing that application tiering and evaluation and ROI. So, we have a case study that we did with Constellation Brands, where they really needed a B2B type ordering portal solution. And they looked at sort of the typical vendors in a packaged solution if you will, a cottage type solution. And we proposed doing a full custom solution, soup to nuts and building it natively in AWS. And it was built completely on top of platform services. There was no servers in that environment and we were done. We were using AWS Fargate to run their containers on top of, we were using RDS Postgres, we were using Lambda and in some places we were using DynamoDB for holding inflate orders. And so the whole environment is deployable from one cloud formation template. So it completely changed how we even went through the testing of the thing. 'Cause you ran the same cloud formation template to deploy to a different environment. And you knew you were getting the same exact thing. And so they went from, they no longer had to worry about securing underlying compute, secure the containers, run on top of Fargate, use a platform service for your databases, and it was a beautiful solution for them. >> Yeah, you got to taste of that and your eyes open up and say, "Wow, what's possible?" >> Yeah, its a game changer. >> We heard that from NASDAQ this morning. An amazing story. She said, our first Amazon bill was 20 bucks. I bet it's higher now, but first hits free kind of thing. But the point is when people talk about the AWS bill, et cetera, no question, you should try to optimize that. But at the end of the day, it's about the business value Scott, isn't it? >> Scott: Yeah, it is. >> Hey, thanks so much for coming to theCUBE. It was great perspectives, >> No, thank you guys. I appreciate having you guys on. >> Thank you very much. >> Keep it right there, Dave Nicholson and I will be right back. You're watching theCUBE's coverage of AWS re:Invent 2021. (gentle music)

>> Narrator: From around the globe, it's theCUBE. With digital coverage of IBM Think 2021. Brought to you by IBM. >> Welcome back to IBM Think 2021. This is theCUBE's continuous virtual in-depth coverage of the people, processes, and technologies that are changing our world. Right now we're going to talk about modernization and the Synergy with Cloud. And we're pleased to welcome Doug Armbrust, who's the VP GTS Cloud Synergy. Hey Doug, how you doing? >> Great, Dave. I'm excited to be on theCUBE, thanks for having me. >> It's our pleasure. Hey, let's talk a little bit of tech. What are some of the technologies that your clients are applying on their path to modernization? >> Sure. I'll give you three examples and three that we're seeing a lot of interest in from a services standpoint. One is automation. Automation is an area that's been a focus for Several decades but We're seeing a renewed excitement around the opportunity for automated operations. Really, I'll talk about two other technologies but the extension of automation and to some of the newer cloud technologies. So that's one. Two is cloud. Cloud has been a terminal industry for a while now and folks have been at various points of a journey to cloud-centric models and technologies. We're seeing an even accelerated transition to not just public cloud but also private cloud technologies, and in particular, need to interconnect those with one another and with a traditional environments. The last one, I think there's been a bit of a referendum on the technology over the last year is around containers, specifically Kubernetes, as a standard for that space. A cementing of direction around containers. Clearly, people are different stages of implementation and experimentation with the technology but I do see a referendum on this being a fundamental part of future technology and direction. >> So, okay. So automation, cloud, and containers. I'm going to ask you a follow up on containers because it's clear that when you look at all the data, it's off the charts in terms of adoption and ultimately our scenario is okay, it gets subsumed into the stack. But where Where the customers ultimately want to go? Obviously, they're upskilling but what's the outcome that they're trying to achieve? >> Yeah, it's a good question. General question of the ask a modernization. I like modern things. We'd like to live in a modern house, my wife likes a farmhouse so guess where we live. (laughs loudly) We live in a farm house with Modernized appliances and infrastructure. >> New cost to live with. (laughs loudly) >> Ultimately, enterprises, they're working back from an objective, and that objective, had this term digital transformation for about a decade. Underneath that umbrella, it's about being able to move and respond quickly. It's about being able to create innovation and accelerate innovation. I think probably most important is deliver on a customer experience and end customer experience. 10 years ago, what I expected when I went to a restaurant was a If I could look them up on the internet and find their location, use my GPS, get there, I was good to go. A year ago, I'm looking for Use an app, them to remember my favorite place to sit. Very different expectations and that pressure on enterprise, to meet those end expectations is really at the heart of The modernization and part of that's Infrastructure modernization containers is interesting because it brings together, not just infrastructure, brings together how application development cycles are being implemented. It has implications for security that Can be positive if done right. We do see that as A key area to meet the end and business objectives. It's going to take some time. IDC, I think is the most bullish. They took like 80% of workloads. By 2023, we'll shift to containers. I believe that for newly created workloads. I think developers have got this in their hands and they understand the efficiencies for their own work as well as when this moves to production. This sort of DevSecOps model, kind of comes with containers if done right. There's a legacy that's going to be around a long time, helping customers understand those operating models and how to live with them both is going to be important over the next five to 10 years. >> You're talking about those drivers responsiveness, the innovation, et cetera. I live in an old house too and there's another component here which is that 80%, reasonable people could discuss that, because there's a risk component, right? I can modernize my house but I could jack up one into the house but it might mess up something that I just did. And so, CIO is obviously a risk-averse, they want to modernize but at the same time, they want to get from point a to point b with minimum disruption. To that end, I wonder if you could talk about what you saw during the pandemic. We're still in the pandemic but you had a reduction in budgets, virtually across the board, minus four, minus 5% in spending, had a shift toward work from home, whatever, VDI, laptops, rushed endpoint security, that whole thing. A lot of organizations try to do both. They said, "Hey, we're actually going to double down on digital transformation." We see this as a lean and opportunity. We got liquidity. How did COVID influence modernization initiatives in your client base? >> It impacted different clients in different ways. Some, as you mentioned, I almost view it as very Darwinian in the sense that those who had modernized and had capabilities, more deeply automated were ready for the transition that they had to go through so they were able to quickly shift to work from home. They were able to deliver on new client experiences, the analogy before in digital transformation, those pressures never went away, but COVID just brought new ones, and they expected all of those things but now they expected the restaurant They expect the restaurant to bring that food to my door and do it in a safe manner. The challenges it brought on organizations were In many cases, new. Some who were in a good position could accelerate work in place and leverage that. Others had a harder time, right? Those who couldn't translate technology to immediate returns, to kind of fuel that ongoing progress, had to make some hard decisions. I would say that's probably the single trend, projects are very carefully reviewed. There's that view of "Will this help me now and into the future?" That's always present but it's present in a stronger manner than we would've have seen it for some time. In that envelope, can I come back to within those three technologies? Automation has certainly We've seen a jump because of its nature. What we see in automation projects is A faster time to implement and achieve some of the agility and flexibility that cloud provides but can take a longer timeframe if you haven't gotten far along in your cloud journey. Containers, even longer timeframe. So a lot of folks are looking at automation projects, particularly those that weren't as well positioned for sort of a quick turn and then taking that automation work and extending it into cloud and containers, as those initiatives progress. >> There are definitely some historical parallels and I could even go back to Y2K and look at all the application rationalization exercises that were going on back then. The technologies were different. You didn't have the modern cloud, containers have been around forever but not in the form of Kubernetes. The automation was scary back then but nonetheless, people were trying to use scripts or whatever they could do. But now, it's almost like an automation mandate, if you were in a digital business, you were out of business. So what are the What are some of the learnings that you've seen from these modernization journeys that you're taking customers on that you might be able to share. >> Let me comment on automation first, I'll say it more generally. I think automation, you're right, we're not finding enterprises that are doing things manually. Everybody's gotten at least to kind of that scripting point. And then we see That has its own journey. Then there's centralization and folks trusting the automation to enable self-service. That's sort of a Kind of a tipping point to who is ready for COVID and who wasn't. Those who had hardened their automation to enable self-service generally could then call on that self service to meet the new demands that they were facing. The next stage and we see less folks there, we get into this sort of Infrastructure as code. We talk about areas of intelligence in your automation. You talk about trust, not as many have progressed to where they trust their automation to Proactively, maybe sometimes reactively respond to a situation or set of You have to be very integrated at that point and you have to really believe in your automation. You then talk about integrating AI to sense, respond, make decisions and bring those back into your automation technologies. I'd say, that's still very future but folks are very intrigued by that. Your more general question, what's sort of some of the learnings. Really goes back to Modernization needs to have a business school. That's become maybe more clear than it was a year and a half ago. In the absence of that, IT projects have always had some degree of failure. It's just the evidence of that failures, probably a little bit more poignant. Related to that, is there needs to be a strategic plan and in particular with modernization, it's easy to get caught up with the modern side. And Dave, you were kind of alluded to this before. If you're not thinking about the old, the connection to the legacy, that's a very common kind of failure signature. It's a marching ahead with the modernization, without a strategic plan and connect those things and an ability to kind of tackle a piece at a time. Sometimes budgets go away and that's a problem. Each step in the journey is really the third lesson. Needs to have incremental value. It needs to kind of pay back something to help fund the next stage of modernization. I'd say the last one and it's self-serving for us as a services company. It's helpful to have a partner on these journeys. In my particular area of focus, in a year and a half, we've had 1,600 engagements. A lot of those engagements are people coming to us after making what they now view as mistakes. Some of the three areas I just mentioned. And being able to bring somebody in with experience with maybe some complimentary skills that can partner within an enterprise can be very helpful to avoid some of the pitfalls. >> I think, your point is right on. I've seen horror stories where people Literally, we're going to go off the mainframe. They got decades old COBOL code that's working just fine and they literally risked their business trying to brute force migrate off and they never could We're not going to freeze the code. It's just horror stories. But today's different, you can actually build an abstraction layer, leverage cloud services, and Kubernetes, and the like, use microservices to actually connect the old to the new. And that's the hardest part, again, old house analogies. I've done a lot of connecting the old to the new, that's the hardest part. You got to be really careful but today the technologies are enabling to do that and one of them is Obviously, things like OpenShift. The definition of open, again, a little history here, it used to be Unix was open and then Windows and then Linux, the LAMP stack. But really That piece of your portfolio is a critical part to enable these types of moves. >> Absolutely. It's exciting that technologies are there and there's a path forward. And it's great to Great to work with a partner, who's maybe, done that 10 or 15 times, or more and have them help guide you on that path. But the good news is there is Enabling technologies to transform in a number of ways, depending on what the business objectives are for an enterprise. >> Cool. All right, Doug, we've got to go. Thanks so much for coming on theCUBE. It's great to see you. >> Okay, same Dave. >> All right. >> Appreciate it. >> Keep it right there everybody. This is Dave Vellante. You're watching IBM Think 2021. The virtual edition covered on theCUBE. (bouncy music)

>>From around the globe. It's the cube with digital coverage of IBM. Think 20, 21 brought to you by IBM. >>Welcome back to the cubes. Continuous coverage of IBM. Think 2021. My name is Dave Volante and I'm one of your hosts for our virtual coverage. We're going to talk about cloud and hybrid cloud. What it is, what it means to clients and how the cloud journey will likely unfold in the coming several years with me to address these issues is Varun Mitch Lonnie. Who's the managing partner hybrid cloud transformation at IBM. Welcome Varun. Good to see you. >>Thank you, Dave. Wonderful to talk to you. Sorry. >>You hear people talk about, you know, they say cloud first cloud, we've got a cloud first strategy. And what does that even mean? What is a cloud strategy? Is it a technology roadmap? Is it a, is it an experience? Is it a business strategy? What really is a cloud strategy all about? And importantly, how does it support the business outcomes? That's really what matters. >>Brilliant, great question. I always believe it's, uh, it's less about the journey to the cloud and it's more important what you do when you get there. That is, you know, what business outcomes does it actually support now many different starting points for an enterprise to embark upon a cloud enabled transformation. You know, things like reducing technical debt and costs, creating new products and services, accelerating time to market and even changing working practices in an organization. Now, as we work with clients, we are seeing increasingly value coming from open innovation. What I mean by that is expanded revenue opportunities with broad ecosystem, you know, new ideas, new platforms, and increase time to market. Now accessing value from what we call those, you know, ecosystems and that open innovation we believe requires, uh, open hybrid multicloud architecture with that. It enables you to plug into those in those ecosystems allows you to fully consider a modernization across your estate and create consistent operating models. >>Also helps reduce, you know, talent and risk, uh, skill risks that organization have. And interestingly, this is exactly where red hat also shines as it's the best hybrid cloud platform out there today. But coming back to the main objective around business objectives, we are seeing that when leaders anchor their transformation on such a holistic strategy, they are driving towards two and a half times, uh, increased economic return as compared to let's say just a singular one single public cloud strategy. And they're able to drive impact on their business case, across multiple dimensions. Things like accelerating the business. So impacting top line, new product services, uh, number two is around accelerating application development and, uh, optimizing, uh, costs associated with that estate, uh, improving infrastructure utilization, um, reducing the cost of security and compliance. And that gives that architectural flexibility, but that was the basis of approach for clients like Delta and is Columbia used. Therefore cloud is absolutely about business outcomes, both top line and bottom line. >>Yeah. Really trying to change that operating model versus of the, of the organization versus just the it model. I mean, we could talk about some of the, the headwinds that organizations face and maybe some of the typical challenges that after they get to the cloud, whether it's organizational technical, there's integration, there's security, maybe even culture. What are you seeing in that regard, >>Uh, spot on, I think you, you you've already started recognizing some of those, you know, when, when, uh, client started, uh, earlier in the journey, they started focusing on consumer driven innovation. They had digital and AI experimentation, and we saw user applications moving to the cloud. Now they are recognizing the need to look at enterprise driven innovation. And how do you start embedding AI into the business at scale? Uh, and therefore they are now realizing that they need to look at their core portfolio, their mission critical applications, you know, 90% of companies, uh, were on the cloud in 2019, but in all estimates, you know, only about 20% of their workloads actually move to the cloud. So, uh, there are a number of different challenges that our clients face, you know, things like economic limits to how many workloads you can move to the public cloud. >>You called out security and regulatory challenges, yourself, speed to value or dealing with complex applications and the uncertain interactions, the data gravity and dependencies. Sometimes they get into the loop of analysis paralysis. You know, another one that I get quite closely involved with is does the cloud technology transformation actually drive and deliver process change? Does it take your old business process and make it into an intelligent workflow? The other dimension is execution in silos today and federated organizational constructs, the, the lack, the right skill and expertise. And then finally is things like technology lock-in and the struggle that people have with inflexible tools and methods, which hinder scale and speed. So those are the few things. >>When I think about just the history of cloud modern cloud, you know, there was, there was a lot of tire kicking early on, and then the financial crisis actually accelerated some moves to cloud. And then coming out of that, there was a lot of shadow it, but it was still as you pointed out very early days. Uh, and then, you know, the comment you made about mission critical is kind of interesting to me because I'm curious, you set out a vision before, uh, of what I call this, this layer of abstraction that hides the complexity. I don't care if I'm on prem and public cloud across clouds, the edge. I, I just, I want you to take care of that in R and D. I want to worry about my business. And so early days, do people want to move their mission critical workloads to the cloud and why, or did they just want to create a modernization layer and hide that complexity? You know, maybe in the context of some of those challenges that you can talk about, what are you, how are you advising clients that they, they take the next step and, and of course, how IBM can help? >>Oh, spot on. So, yes, I think now they're recognizing that there is value of looking at those complex core applications and looking at where should that, what needs to happen to my complex core application by mission critical application. Do I need to, uh, defragment that, do I need to decompose into, uh, new capabilities? Do I need to just move it to the cloud? We need to keep it where it is because in some instances that's where I get maximum security and data gravity. So if I reflect on this, I think there are four key things I would call out as what I would call the get rights. Uh, number one is ensure that we are aligning with business outcomes. Number two, clarity of target architecture and portfolio. Number three is, you know, accelerating the journey with the right methods, tools, and patterns. And the fourth one, which is closest to my heart is about delivering via an improved operating model. >>So let's, let's just scratch the surface on this a little bit. Now, when you talk about aligning with business outcomes, first of course, is, you know, clear business ownership and alignment with the overall strategy, but what's important is what capabilities does the business need to deliver that strategy? And how is cloud going to help enable those capabilities? For example, you know, integration with ecosystem partners, foster launch of new products and services, monetizing data assets, things like that. And this was one of the key drivers for a healthcare company that I recently worked with in, in North America. When we talk about clarity of target portfolio, you know, uh, this is about what's my architecture going to be across the edge, on-prem private public, what should I do to my applications? And where should they resigned? Should I keep, should I kill? Should I modernize? What should I do? >>So for example, we've seen, you know, a lot of companies around 15% of applications, you may not touch at all. Uh, 20% of those applications, you may replace with SAS solutions. Um, 45 to 50% is where you start looking at modernizing. And that's where you look at, what do you do with your monolithic applications and how do you modernize them? And around 15% you might say is building brand new native capabilities on the cloud. So that's kind of the second get, right? The third was about accelerating with proven patterns and methods and tools. And this is about increasing speed to value early wins and being able to analyze and decompose complex applications quickly and reliably. And once they're executing on that journey, how do you grow from garage to scale capabilities? Now here, we've made some, uh, you know, strong folks and investments in this space. >>Uh, we have a set of standard patterns that allow you to modernize and migrate applications, you know, depending on looking at your operating system, the integration technology, the container standards, and so on. And it's, uh, important to have the right tools that bring in AI and machine learning to bear. For example, we have our own, you know, cloud advisory tool that looks at the operating system and the code to explain and give guidance on what disposition and what containerization is most applicable. And then finally, you know, this consistent operating model, how should the ways of working actually change on the ground? How should platform engineering and the application teams work together? Should I instantiate that with a competency center that helps me get onto the journey? How do I have the right skills, uh, not being siloed, the consistent security approach, and especially for companies that are in the looking at real complex mission, critical workloads to them that becomes even more important and in regulatory environments. So to recap, I'd say those four things alignment with the business clarity of target portfolio, uh, accelerating with the right methods and tools, and of course, embedding through a sustainable operating model. I'll pause there. >>Yeah. Great. Thank you for that. I would say my takeaway is this is not your grandfather's application rationalization exercise, you know, which was kind of a one-shot deal every 10 years, Oh, Y2K. We're going to ride whatever it was. And what you're describing is essentially a way to have continuous improvement is obviously a lot of automation there, but very importantly, there's a gain sharing aspect where you can reinvest in innovation. And I think, you know, one of the areas you mentioned is ecosystem. We haven't even talked about it. We don't have the time, but, but the whole data opportunity there for around innovation, because that is how ecosystems are they're going to form around, you know, that data model. And it's a, it's an, it's a new world. And thank you so much for your very articulate vision that you set out and congratulations on all the progress that you've made. And I really appreciate your time. >>Thank you very much, Dave. Wonderful to talk to you, looking forward to more conversations >>I am as well. And thank you for watching everybody. This is Dave Volante for the cube. You're watching our continuous coverage of IBM think 2021, the virtual edition. We're right back.

(Upbeat music) >> Okay, welcome back everyone, to theCUBE's Coverage of Red Hat Summit 2021 virtual I'm John Furrier, your host of theCUBE got two great guests from Deloitte Consulting Dave Knight who manages the Red Hat Relationship, Lee he's the lead there, and Mike Bourgeois who's the Public Sector Managing Director both from Deloitte Consulting LLP official name. Guys, great to come on, and we were just talking before camera about all the stories. Great to have you on theCUBE, thanks for coming on. >> Yeah, thanks for having me. >> Like I said we were just talking about all the stories from the transition from pre-COVID, COVID. Now we've got a view into post-COVID. I want to dig into that 'cause there's a lot of things happening. You guys have been in the trenches, front lines bringing solutions, but before we get into that, can you guys just introduce yourself share your roles at Deloitte and give us a quick overview of what you work on. >> Yeah, so again, thanks for having us John Dave Knight I'm a solution architect and Global Red Hat Alliance Manager for Deloitte. I've got responsibility for making sure that play nicely in the sandbox together or we've got a joint customer and solutions to deliver to those customers. >> Hi everyone, thanks for having us John, I'm a Managing Director Mike Bushwa out of Boston Texas. I am coming up on year 20 and Public Sector Consulting. My area of expertise is large state government systems that serve the needs of millions of citizens and thousands of state workers, good to be here. >> Yeah. Great to have you. And I wanted to chime in with you right away because Mike you are living in probably one of the hottest markets Public Sector. I've been following that for many, many years, generations actually from the early computer industry GSA contracts, all these contracts you've got all the Public Sector, they move very slowly but now the pandemic, there was no place to hide. Everything got pulled back, disruption, you can't just shut down critical infrastructure and critical services. People had to move fast. What was your experience and how is it now give us a taste of some of the challenges and the landscape. >> You bet John, so we talked a little bit before we started this, but my 20 year consulting career, I can't think of anything really in close to this, other than maybe Y2K and as Dave mentioned the Affordable Care Act Legislation in 2009, though that was a much smaller scale as it turned out to be. So I would be remiss not to share examples of extraordinary challenges our clients have had related to the pandemic. Department of Labor and Health and Human Service Agencies for example, responded to the pandemic in rapid timeframe that were rarely seen in government. Citizens that were used to coming in appealed offices, We're now required to do most things virtually. Deloitte has been privileged to assist clients with digital solutions across the country in response to this unprecedented event. And so I'd like to share just a couple of examples. The first is for Department of Labor, the pandemic contributed to millions of layoffs throughout the country Department of Labor workers found called volumes increasing by a 1000% in some cases, the amount of increased volume required agencies across the country hire temporary workers to help out. Millions of new unemployment claims needed to be filed in benefits rapidly provided to citizens of name. So the big challenge was the agency had to figure out how to rapidly file claims into the unemployment system, rather than requiring new citizens to use an external web application they were really unfamiliar, the agency needed more efficient approach. The approach we used was to create an internal web application that enabled workers to file unemployment insurance claims on behalf of citizens. Workers collected the necessary data from citizens and claims were filed into the system. The application enabled workers to focus on filing claims rather than sort of a technical support role showing how to people use an external web application. More citizen were served in much less time, claims are filed efficiently by train workers which resulted in benefits being received in a much more timely fashion. And so a second example is, with Department of Human Services. So one stay as mentioned Citizens were used to going into field offices but suddenly they were told you can't come into the field office. So once they provided a 100% virtual application and the important part here is certification solution for the Disaster Supplemental Nutrition Assistance Program or DSNAP for short. this application was stood up in two weeks, families who needed food assistance can now apply and be certified for benefits remotely. Today over 50,000 cases have certified and citizens receiving food nutrition assistance. Back to you John. >> So, I mean obviously there's some great use cases you got, basically I got to work at home, new architecture there you got to have a new workflows. I mean, this poses some real challenges. How did you guys put it together? I mean, Dave take us through where this all fits in with the Red Hat, because obviously now it's new deployment new capabilities have to be deployed for the pandemic. How does this bring together the partnership with Red Hat? >> Yeah, so great question and it really plays to the strength of both Deloitte and Red Hat, right? The success stories that Mike has illustrated show how we can quickly pivot as a firm to delivering these types of solutions and help our customers think through innovative ways to solve the problems. So, I mean the prime example that Mike just gave, everything used to be done in offices. Now it's all done remotely cause you can't go to the office even if you want to. And that is very much aligned with the innovation we get with our partnership with Red Hat, right? They've led the way in open source and some of the technologies that we've leveraged that our solutions include, answerable for automation, some of the middleware products, and I would say one of the cornerstones is the OpenShift Platform. Now that allows us to greatly accelerate the development and delivery of those solutions to our customers. Sort of again, aligning our innovative thinking with Red Hats Innovative Technologies. >> What would you say if someone said, "what's the partnership strengths and what needs specifically are you addressing with customers and customer needs?" >> So I, again, I think our lean towards innovation is a common thread across both firms and where we have our greatest strength. We like to take our customers on a journey but it's not our journey, it's their journey, right? So we help them figure out where they want to go and how they want to get there in a way that aligns with their business goals, their budgets all the sort of factors that drive those things and Red Hat is very open to that approach. They sort of invented the crowdsourcing of open source they made it into a business model. They've developed that from literally nothing. And that aligns very nicely with us. That's one of the key strengths. We also are firm believers in open source again to the degree that our customers like the leverage that to drive their journeys. And we're seeing that, especially in the Public Sector Space as being a key driver of the technologies they employ. >> Mike, I want to come back to you on this open ma component open question, open source, open to technology open innovation out in the open as Red Hat calls it. How does Red Hat open source software, address the needs for your customers for security and on-premise considerations. >> I'll talk a little bit about open source principles in general still the open source principles of transparency meritocracy community problem solving and collaboration. These are on its of both software innovation as well as organizational transformation. One of the highest demand transformation needs that I'm seeing in the market is the desire to adopt innovative technology, and most importantly, moving workloads to the cloud. It's no longer a thought, it is an imperative moving workloads to the cloud, on new deals hosted in the cloud, on an existing, is it large systems let Deloitte help us get to the cloud. So I believe the key to success embracing the cloud is recognizing first the need for change in people, processes and technology. The vehicle for this transformation is DevSecOps and innovative open source platforms, such as the OpenShift platform that Dave mentioned. OpenShift focuses on people, processes and technology and the security conversation becomes even easier. I mean, I see Linux was around for years, and we've always used Linux on our Java based workloads now we can have the conversation about saying, Hey, well that se Linux operating system we've been using for years now, there's this really cool Container Management Platform that we can solve real problems like auto scaling, in my Health and Human Services career, I can remember every year when open enrollment comes around systems engineers are teed up, and ready to manually add those to a BMR cluster or something like that. Well, now we don't have to do these things. We can rely on Kubernetes so auto scale, and then and get rid of those instances when workload demands seven resolved. So it's a really cool technology kind of behind the scenes. It's not the dog and pony show sometimes but in the end it helps the clients and Deloitte remain consistent with those service level agreements. >> That's a great example about the open enrollment illustrates the fact that, you got to provision more stuff to take that load on it. It's always hard in Public Sector you might not have the speed. So I got to follow up and ask you, you guys have had wins in the Public Sector lately with Red Hat, you guys Deloitte and Red Hat working together and get some wins under your belt, on around cloud and cloud and technology obviously with the pandemic has needs there. Are you guys seeing any particular sector challenges specifically around Public Sector as it goes this next level a lot of modernization happening we're seeing that, but any challenges that you're seeing, can you give some examples of how these challenges are being addressed? First talk about the challenges and then give some examples of how they're overcoming them. >> So I can jump in here with this one then, and Mike I think you probably have some maybe Public Sector specific examples, but one of the things that I think is common across all industries is resource constraints, right? And particularly as we look for human resources and not in the HR sense, but developers, CIS admins those types of resources as Mike said, the cloud is here to stay, right? And it's not something that people are thinking about it's de facto part of the conversation. And that's great, but it leads to silos of skills which puts further sort of strain on a limited pool of resources within most sites IT organization. So something like an OpenShift, something like an Ansible solves problems related to resource constraints, because they're skills that are portable across cloud environments, right? If you can manage OpenShift you can manage OpenShift on-prem, you can manage it recently released AWS version of that ROSA on the Azure version of that. So it's no matter where you're running it you've got a common set of skills and access sort of a force multiplier, same thing with Ansible automation, right? If you can write scripts, with an Ansible you can do those repeatable tasks in a much more efficient fashion. And again sort of multiplying the capacity of your existing workforce. >> So you've got an operating leverage there. I mean, this is what you're getting at is that, Public Sector and other commercial areas they kind of got to get used to this fact that, you get some leverage here, you get some operating leverage. >> More or less has always been a thing in IT. And it's not relenting that's for sure. >> It's been more at the more, with less has always been kind of a tagline for budget cuts, right? You can squeeze more out of the investment. Here it's kind of like do more with less than the sense of there's more net new things happening with leverage. So, I mean, do you agree with that? What's your take on that? >> Yeah, I think that's exactly right. It's more with less from a resource perspective, right? Typically it was budget, but no money is just another resource. Now we're getting into the personnel side of it. The other thing I would say is, something like an OpenShift Platform allows the Mike's point around DevOps, it allows the developers to develop, right? I have an article in wired.com about this, where developers are saddled with meetings and they have to become concerned with infrastructure and they have traditionally and security. And I am I doing all these things that aren't related to development. If you have a good DevOps Platform in place the security folks can build guard rails into the platform and the developers can just go develop which is what they want to do in the first place. Yeah exactly, that's another riff on the more, with less, again in a resource, the human resource way versus the budget way. >> Yeah, and that really is where OpenShift ties in. Mike what's your take on this? Because with this kind of program ability infrastructure as code DevSecOps kind of modern developers, Public Sector loves that, because they just want to build the new apps. They got to modernize. So change the infrastructure once. And then a lot of ma many benefits on top of it. It's almost like, it sounds like an operating system to me. >> Yeah, lots of thoughts going around my head right now but I'll say the more with less to me when I'm having client conversations is imagine a world of higher innovation, more technology at lower costs, right? I mean, so CIO is light up when I explained to them the orders of magnitude cost savings on top of the innovation introduced to their environment. So when moving workloads to the cloud is not as easy as just packaging up a binary and dropping in on a name, your cloud provider, right? There's an entire, a blueprinting strategy. There's a Cloud Native Architecture, modernization discussion, so we do those sorts of things, at Deloitte and we work with clients very closely to do that. I want to say teaming with Red Hat allows us to be proactive with our design and reference architecture validation. The Collaborative Partnership in Relationship allows us to connect senior engineers from Deloitte and Red Hat. So we have low level strategic discussions, we validate our assumptions and optimize to use a Red Hat technology. What we're doing in Public Sector is separating the monolithic application into layers. And whenever it comes to technologies like Ansible, like OpenShift, like Jenkins, all of these things that any application needs and Public Sector, we're saying out to the account teams across the country, look this is a slower layer DevOps Platform. And by the way, you can run any .Net or Java based workload on it. So we're trying to make opinionated reference architecture so that regardless of the solution, we can just go to market with that platform that tried and true production application. So I'll give a quick example John, if now's a convenient time regarding, well, one of the things that we've done for particular state client. >> Definitely yeah, give the use cases we love those. >> Yes so one of the impactful modernization that struck my mind was the State of Washington. They've mentioned the affordable care act earlier, there are two major things that came out of that. One was the eligibility and enrollment systems had to be modified across all 50 states. But the second thing and the primary driver behind the affordable care act was health insurance exchange. A way for millions of citizens to have access to healthcare using Subsidized Health Insurance Plans. So in Washington and health benefits exchange is that health insurance exchange, State of Washington has been a client of Deloitte since 2012. The solution was originally designed using closed source proprietary products. There are three drivers for change. The first is the API gateway was end of life and needed to be replaced. Number two was the client wanted it to move health benefit exchange to the cloud from an on-premise hosting arrangement. And third is reducing cost of those solution with innovative products. So the agency was looking for a platform that provided flexibility, auto-scaling and performance and lower cost of ownership. So we worked with the agency and we evaluated a variety of API Management and Integration Platforms after reviewing the outcomes for each proof of concept the agency decided to move forward with Red Hats, three skill API Management Platform, Red Hat Fuse for Integration and OpenShift Container Platform that offered the auto-scaling continuous integration tools and out of the box monitoring and reporting capabilities proactively monitor the health of the solution. I often describe a little bit of OpenShift as a data center or DevSecOps in the box. It just is all there. You don't need to add layers on top of OpenShift install and configure it, tune it and just you're off and running in a short amount of time. So three outcomes I'll mention, go ahead, John. >> NO continue, I thought you were finished. So on the outcomes side, the first outcome the agency substantially lower the cost of ownership using commercially supported open source while increasing access to innovative emerging technology. So the agency wanted a solution not only to meet their current needs, but extend the solution going forward. The beautiful thing about OpenShift is you can drop a container images into the platform without installing an operating system. It's all just there and it's spreading to be extended. The number two outcome cloud migration. Deloitte work collaboratively with the agencies and infrastructure and managed services team to successfully migrate the health benefit exchange to the cloud. And the last thing a bit obvious, but that's successful release, working collaboratively with our client. We were able to migrate the solution within 100 days from making the products decision. The cut over to the new solution was seamless with minimal downtime and zero production issues or exceptionally proud of that. >> Great stuff, great use case. And again, those are great business examples. Dave, I want to get this last question to you and Mike can chime in too. As Red Hat Summit evolves, and we're hearing the theme here at the event about transformation is the innovation, Innovation is about scale. When you hear the words like in a box or Hybrid Cloud you hear about an operating environment. So it's an opportunity to set the table for the next generation, this is what I see. What do you guys see as people talk about Hybrid Cloud and soon to be Multiple Cloud? Because you guys you said have tough relationships. You deal with IBM and Red Hat and you probably deal with other people. Clients want, from what we hear they want back to the Multi Vendor Open Connection Distributed Environment. That's what they want. So how does your relationship evolve, given all this is happening? How do you see the future, please chime in. >> Thanks, that's a fantastic question. I actually think the market is coming catching up to where I've been thinking for quite a while. And that is the Hybrid is kind of where it's at. A lot of customers have been in some sort of Hybrid mode as part of the step or a journey to the cloud, getting all the way to the cloud. But I think we're seeing some transition. I know customers are starting to ask me more and more about Hybrid solutions for a variety of reasons, right? The easy workloads for the most part have either been moved or be are being moved, or at least there's a strategy and a plan to get them moved. And now we're starting to be asked about some of the more difficult architecture type questions, right? The workloads that are a little bit more sticky to the on-premise model. And so Hybrid becoming more of the endpoint as opposed to a step along the journey. The other big thing is some repatriation, right? Workloads coming off of cloud. Maybe they seem like good candidates but for whatever reason, the cost drivers or other things weren't realized, let's get them back on premise. Maybe it's a regulatory thing and new regulations are making folks uncomfortable. So I see Hybrid as a pretty interesting next wave of cloud, Deloitte as a far or we're skilling up or tooling up in order to address the needs of our customers, again are starting to ask us these really challenging questions about Hybrid Cloud and Hybrid Cloud Architectures. >> Yeah and just the key point there is that you think about it like with the way you're discussing it, it's a platform, not a tool, right? So if you think about it like a platform then you can move things around and look at architectures and changes of how resources and workloads are deployed and then what data you're getting from it. Whether you bring it to a factory, for instance you say, Hey, okay, we're going to put it on prem because it's a factory or whatever, and you need more data. What was the changeover? This is like a day to operations kind of mindset. What's your comment on that? >> Well I mean I have actually going back three years now, one of the marketing lines that we developed internally, was moved to a platform, not a provider. But because you get that flexibility, now, the reality is what works stay where they're put for a variety of reasons. But I think one of those reasons could be, because they're put in places where they tend to not want to move, right? So if we could put them into a platform where, there is some portability built into the platform, I think we might have a different sort of outcomes for customers. And I think architecture is absolutely the key, right? That to me is the secret sauce here. >> Mike set up for you to close us out here, platform, Public Sector, Hybrid, that's what they want. It's an ideal scenario for anyone in Public Sector and in general, and why wouldn't you want to have a great platform that's it can be programmed, and rearchitected at will for the benefit of the business powered by software. What's your thoughts? >> Yeah, all good points and I will agree with Dave that Hybrid is certainly evolving. Eight years ago, Hybrid was consuming and address validation API in the cloud and not custom coding that, but today I do agree that Hybrid Cloud is all about a vehicle a way of moving workloads across data centers. It's an architecture that is encapsulated by something like an OpenShift so that you can federate your workloads across data centers. You can put them in one or easily moved them to the other. Maybe that's for a variety of reasons. It could be compute and storage is being reduced by one provider versus the other. So the solutions were we're designing today, they are data center agnostic, we're not being tied to data centers anymore. The best design solutions, you can just let them move in their easy manner. So that that's my take on Hybrid Cloud. And I would say the and Red Hat are making investments to help us advance that thinking help us advance those solutions. We had Deloitte have created a Red Hat OpenShift lab environment, and we've done this purposely to validate reference architectures to show account teams the way we have delivered the very very large accounts to show them what DevSecOps to means from a product perspective and to give them opinionated processes to be successful in delivering these large type solutions. >> Dave, Mike, thanks for coming on, and I appreciate you guys coming on theCUBE and sharing the perspective on the Red Hat Relationship with Deloitte Consulting. Thanks for coming on. >> Thank you. >> Thank you, John. >> This is CUBE Coverage of Red Hat Summit 2021, am John for your host, thanks for watching.

(soothing music) >> Narrator: From around the globe, it's theCUBE. With digital coverage of IBM Think 2021. Brought to you by IBM. >> Welcome back to IBM Think 2021. This is theCUBE's continuous virtual in-depth coverage of the people, processes, and technologies that are changing our world. Right now we're going to talk about modernization and the Synergy with Cloud. And we're pleased to welcome Doug Armbrust, who's the VP GTS Cloud Synergy. Hey Doug, how you doing? >> Great, Dave. I'm excited to be on theCUBE, thanks for having me. >> It's our pleasure. Hey, let's talk a little bit of tech. What are some of the technologies that your clients are applying on their path to modernization? >> Sure. I'll give you three examples and three that we're seeing a lot of interest in from a services standpoint. One is automation. Automation is an area that's been a focus for... Several decades but... We're seeing a renewed excitement around the opportunity for automated operations. Really, I'll talk about two other technologies but the extension of automation and to some of the newer cloud technologies. So that's one. Two is cloud. Cloud has been a terminal industry for a while now and folks have been at various points of a journey to cloud-centric models and technologies. We're seeing an even accelerated transition to not just public cloud but also private cloud technologies, and in particular, need to interconnect those with one another and with a traditional environments. The last one, I think there's been a bit of a referendum on the technology over the last year is around containers, specifically Kubernetes, as a standard for that space. A cementing of direction around containers. Clearly, people are different stages of implementation and experimentation with the technology but I do see a referendum on this being a fundamental part of future technology and direction. >> So, okay. So automation, cloud, and containers. I'm going to ask you a follow up on containers because it's clear that when you look at all the data, it's off the charts in terms of adoption and ultimately our scenario is okay, it gets subsumed into the stack. But where... Where the customers ultimately want to go? Obviously, they're upskilling but what's the outcome that they're trying to achieve? >> Yeah, it's a good question. General question of the ask a modernization. I like modern things. We'd like to live in a modern house, my wife likes a farmhouse so guess where we live. (laughs loudly) We live in a farm house with... Modernized appliances and infrastructure. >> New cost to live with. (laughs loudly) >> Ultimately, enterprises, they're working back from an objective, and that objective, had this term digital transformation for about a decade. Underneath that umbrella, it's about being able to move and respond quickly. It's about being able to create innovation and accelerate innovation. I think probably most important is deliver on a customer experience and end customer experience. 10 years ago, what I expected when I went to a restaurant was a... If I could look them up on the internet and find their location, use my GPS, get there, I was good to go. I'm looking for... Use an app, them to remember my favorite place to sit. Very different expectations and that pressure on enterprise, to meet those annex and expectations is really at the heart of... The modernization and part of that's... Infrastructure modernization containers is interesting because it brings together, not just infrastructure, brings together how application development cycles are being implemented. It has implications for security that... Can be positive if done right. We do see that as... A key area to meet the end and business objectives. It's going to take some time. IDC, I think is the most bullish. They took like 80% of workloads. By 2023, we'll shift to containers. I believe that for newly created workloads. I think developers have got this in their hands and they understand the efficiencies for their own work as well as when this moves to production. This sort of DevSecOps model, kind of comes with containers if done right. There's a legacy that's going to be around a long time, helping customers understand those operating models and how to live with them both is going to be important over the next five to 10 years. >> You're talking about those drivers responsiveness, the innovation, et cetera. I live in an old house too and there's another component here which is that 80%, reasonable people could discuss that, because there's a risk component, right? I can modernize my house but I could jack up one into the house but it might mess up something that I just did. And so, CIO is obviously a risk-averse, they want to modernize but at the same time, they want to get from point a to point b with minimum disruption. To that end, I wonder if you could talk about what you saw during the pandemic. We're still in the pandemic but you had a reduction in budgets, virtually across the board, minus four, minus 5% in spending, had a shift toward work from home, whatever, VDI, laptops, rushed endpoint security, that whole thing. A lot of organizations try to do both. They said, "Hey, we're actually going to double down on digital transformation." We see this as a lean and opportunity. We got liquidity. How did COVID influence modernization initiatives in your client base? >> It impacted different clients in different ways. Some, as you mentioned, I almost view it as very Darwinian in the sense that those who had modernized and had capabilities, more deeply automated were ready for the transition that they had to go through so they were able to quickly shift to work from home. They were able to deliver on new client experiences, the analogy before in digital transformation, those pressures never went away, but COVID just brought new ones, and they expected all of those things but now they expected the restaurant... They expect the restaurant to bring that food to my door and do it in a safe manner. The challenges it brought on organizations were... In many cases, new. Some who were in a good position could accelerate work in place and leverage that. Others had a harder time, right? Those who couldn't translate technology to immediate returns, to kind of fuel that ongoing progress, had to make some hard decisions. I would say that's probably the single trend, projects are very carefully reviewed. There's that view of... "Will this help me now and into the future?" That's always present but it's present in a stronger manner than we would've have seen it for some time. In that envelope, can I come back to within those three technologies? Automation has certainly... We've seen a jump because of its nature. What we see in automation projects is... A faster time to implement and achieve some of the agility and flexibility that cloud provides but can take a longer timeframe if you haven't gotten far along in your cloud journey. Containers, even longer timeframe. So a lot of folks are looking at automation projects, particularly those that weren't as well positioned for sort of a quick turn and then taking that automation work and extending it into cloud and containers, as those initiatives progress. >> There are definitely some historical parallels and I could even go back to Y2K and look at all the application rationalization exercises that were going on back then. The technologies were different. You didn't have the modern cloud, containers have been around forever but not in the form of Kubernetes. The automation was scary back then but nonetheless, people were trying to use scripts or whatever they could do. But now, it's almost like an automation mandate, if you were in a digital business, you were out of business. So what are the... What are some of the learnings that you've seen from these modernization journeys that you're taking customers on that you might be able to share. >> Let me comment on automation first, I'll say it more generally. I think automation, you're right, we're not finding enterprises that are doing things manually. Everybody's gotten at least to kind of that scripting point. And then we see... That has its own journey. Then there's centralization and folks trusting the automation to enable self-service. That's sort of a... Kind of a tipping point to who is ready for COVID and who wasn't. Those who had hardened their automation to enable self-service generally could then call on that self service to meet the new demands that they were facing. The next stage and we see less folks there, we get into this sort of... Infrastructure as code. We talk about areas of intelligence in your automation. You talk about trust, not as many have progressed to where they trust their automation to... Proactively, maybe sometimes reactively respond to a situation or set of... You have to be very integrated at that point and you have to really believe in your automation. You then talk about integrating AI to sense, respond, make decisions and bring those back into your automation technologies. I'd say, that's still very future but folks are very intrigued by that. Your more general question, what's sort of some of the learnings. Really goes back to... Modernization needs to have a business school. That's become maybe more clear than it was a year and a half ago. In the absence of that, IT projects have always had some degree of failure. It's just the evidence of that failures, probably a little bit more poignant. Related to that, is there needs to be a strategic plan and in particular with modernization, it's easy to get caught up with the modern side. And Dave, you were kind of alluded to this before. If you're not thinking about the old, the connection to the legacy, that's a very common kind of failure signature. It's a marching ahead with the modernization, without a strategic plan and connect those things and an ability to kind of tackle a piece at a time. Sometimes budgets go away and that's a problem. Each step in the journey is really the third lesson. Needs to have incremental value. It needs to kind of pay back something to help fund the next stage of modernization. I'd say the last one and it's self-serving for us as a services company. It's helpful to have a partner on these journeys. In my particular area of focus, in a year and a half, we've had... 1,600 engagements. A lot of those engagements are people coming to us after making what they now view as mistakes. Some of the three areas I just mentioned. And being able to bring somebody in with experience with maybe some complimentary skills that can partner within an enterprise can be very helpful to avoid some of the pitfalls. >> I think, your point is right on. I've seen horror stories where people... Literally, we're going to go off the mainframe. They got decades old COBOL code that's working just fine and they literally risked their business trying to brute force migrate off and they never could... We're not going to freeze the code. It's just horror stories. But today's different, you can actually build an abstraction layer, leverage cloud services, and Kubernetes, and the like, use microservices to actually connect the old to the new. And that's the hardest part, again, old house analogies. I've done a lot of connecting the old to the new, that's the hardest part. You got to be really careful but today the technologies are enabling to do that and one of them is... Obviously, things like OpenShift. The definition of open, again, a little history here, it used to be... Unix was open and then Windows and then Linux, the LAMP stack. But really... That piece of your portfolio is a critical part to enable these types of moves. >> Absolutely. It's exciting that technologies are there and there's a path forward. And it's great to... Great to work with a partner, who's maybe, done that 10 or 15 times, or more and have them help guide you on that path. But the good news is there is... Enabling technologies to transform in a number of ways, depending on what the business objectives are for an enterprise. >> Cool. All right, Doug, we've got to go. Thanks so much for coming on theCUBE. It's great to see you. >> Okay, same Dave. >> All right. >> Appreciate it. >> Keep it right there everybody. This is Dave Vellante. You're watching IBM Think 2021. The virtual edition covered on theCUBE. (bouncy music)

>> Woman's Voice: From the CUBE studios in Palo Alto in Boston, connecting with thought leaders all around the world, this is a CUBE conversation. >> Hey, welcome back already. Jeff Rick here, with theCUBE. We're having Palo Alto studios, during these kind of crazy times and really taking a moment with the time that we have to reach out to some of the leaders in our community, to give us some insight, to give us some advice, to share their knowledge about some of the things that are going on and some of the specific challenges that really the coronavirus and the COVID 19 situation are causing for all of us. So, we're really excited to have a CUBE alumni, haven't talked to him for a couple of years. Joining us from his house, he's Marten Mickos, the CEO of Hacker One. Marten, great to see you. >> Good to see you, Jeff. Good to be back. Thank you. >> So first off, just a quick check in. How are you doing? How things going at Hacker One? How's the team doing? How are you guys kind of getting through this time of difficulty? >> Well, we are fortunate in our company that we have a business that may be doing even better in these times, because we do security don't need to go into the office and we do it in a distributed way. And so, all of that is wonderful for the company. We do have our first positive case of COVID 19 in the company. He is now fully recovered after a few weeks. He's back at work. So, it means it came pretty close to us and we have others who might be in the danger zone. But overall, we are doing very well and paying a lot of attention on health and staying safe and working from home and making sure we don't take risk because these are serious things that we shouldn't play with. >> Yes. Well, I'm glad to hear that, that person is recovering. And I think April is the month of six degrees of separation where all of us are going to know someone or someone who knows someone who's got this thing, is it? The curves, unfortunately, are still going up in the United States. So, I don't think that's going to change. But, on a lighter note, one of the reasons I wanted to reach out to you is you've got a long history of working with distributed companies. This COVID thing is kind of a forcing function around work from home and it never fails to amaze me how many people are on their first Zoom, and they don't even know what WebEx is, and they've never heard of Skype. And I think we get spoiled in the tech world. We use these tools all the time. But this is a forcing function. It's at the grade schools, the middle schools, the high schools, besides just regular companies. So, when you were running MySQL, back in the day, you had a distributed company, not only across buildings, but across oceans and continents. So, I wonder if you can share kind of, did that start that way? Did you move into that way? Kind of what are some of the early days as you move from everybody in the office to more of a distributed network? >> Yeah, it did start that way at MySQL back in Scandinavia. And I joined. There were 12 people, everybody working from home. The CTO lived just half an hour away from me, but we never saw each other. I worked from home, he worked from home. And I remember when I as the new CEO said that, hey, we will need an office. We need a headquarters where we can have meetings and archives or contracts and stuff. And he said, no office, over my dead body. It will kill the company culture. That was the view >> Why! >> Of the founder. >> That is so progressive. Where did that view come from, Cause that is certainly was not the kind of standard thinking. >> It was weird. It was back in, that was the year 2000, and they had developed a way of working with open source contributors all over the world, over email and IRC back then, which is a predecessor to slack you could say. And they just developed that method of working together and making sure everything is digital, everything is written down. You are honest and forthright in writing as well. So it worked beautifully and they didn't like offices. We ended up having offices and we had many people working from the office but there was nowhere, at no time was it more than 30% of our headcount of about 500 people who work from an office. 70% work from home in 32 different countries across 16 time zones. >> Wow, that's very, very distributed. So, in getting ready for this, I saw some other interviews that you've done and some other conversations on the topic. And one of the things that you brought up that I think is really topical is that this is really more of a mental challenge than really a physical challenge. The tools are there, we have internet, we're very fortunate that way. Didn't have these things in 2000, like we do today. But you talked about the mental challenge, both from a leadership perspective, as well as maybe from the employee perspective. I wonder if you can dig into that a little deeper as you kind of look at your peers that are treading into unchartered waters, if you will. >> Well, I think it's a transition where you become one with the media, like with your laptop or whatever you're looking at and you sort of you invest yourself in what you have in front of you and you give off all of yourself into it. Just like, if somebody is taking a portrait of you with a camera, you have to sort of love the camera and show yourself to the camera for the portrait to be really, really good. Like that's what great photographers do. They get you to open up, even though it's a machine and not another human being. And we have to develop this skill digitally to sit in front of a laptop or a phone or something, and be our whole genuine selves, showing all dimensions and aspects of our personality. Because we don't realize it but when you go to an office, people are paying attention to how you walk, where you stop, what you look like, whether you look angry or happy, whether you look tired or not, when you go to the restroom, when you don't, like who knows all these things that people pay attention to that give away how you feel and how you are. And then somebody may come and say, Hey, Jeff seems to be in a bad mood today or Jeff seems to be in a good mood today. And those are vital functions of a group that works together. So, you must allow the digital world to have the same. You have to bring that part of yourself into the digital reality and sort of open up. And people make the mistake that they just bring their professional selves. They just say, okay, what's the task? What's the work? Let's agree on something, let's listen to everybody. And they don't reserve room for the social side and showing who you are. Because people won't ultimately trust you until they know that you are a human being and you have weaknesses and vulnerabilities and you can be silly and sometimes you look good, and sometimes you don't look good, and sometimes you are to your advantage, and sometimes you aren't. And until you have covered the whole range of your own expressions, you're not believable. >> Yeah. Another topic that came up is measurement, right? In KPIs, and how do you measure people's performance? It wasn't that long ago that Ginni Rometty at IBM came out and said, we don't want remote workers anymore. We want everybody to come check into the office. Well, that's changed a little bit. But, you mentioned that, we're so used to measuring things the way that we've always measured in the past. Are they there at eight? Do they stay till five or six? Do they look busy, as opposed to really focusing on outputs? And you talked about really shifting your mindset with a distributed workforce to make sure you're focusing on the right outcomes, not necessarily focusing on the things that maybe, as you said, as much as subconsciously, you're paying attention to as much as anything. >> It's so easy to fake it in an office. >> I love that. >> You go in there, you look busy and people think you're amazing. But when you work from home, the only thing you have to show for is your work results. So, it becomes much more objective. And of course, you have to create metrics that can be tracked in a way that others can understand what you're doing. But it actually makes it more straightforward because you can't fake it. >> Right. >> The only thing you can be measured by is what you're actually producing. >> It's got to be interesting when we come out of this, right? Cause there's a lot of psychology done around habits and how things become habits. And the way things become habits is you do them for a while, in sequence repeatedly and then that becomes kind of part of your routine. And before, even here at theCUBE, right? Remote interviews were probably, I don't know, 5% of our total output. And now they're going to be 100% for the foreseeable future. So, as you look at kind of people that are new to this, world of remote learning and remote working, it's going to be wild after they do this for a couple weeks hopefully get into the habit, to then, as you said in some prior things, this becomes the new normal and go into the office is the once every so often, when we actually have to have a big team meeting or some specific events. So you think this is going to probably be that tipping point till this becomes the new normal. >> I do think so. I think it will flip so that now, you may think that you and I are having a virtual conversation and it would be a real conversation, if we were in the same room. That will flip. Soon, this will be the real conversation. And if we meet in person, then it's an anomaly, and that's the virtual thing. >> Right. >> Because most of the time, we will connect like this and we will figure out ways to understand each other and know whether we can trust each other and sort of all these things will evolve on the digital side. And there's no reason why they wouldn't. >> Right. >> Other than the reluctance of human beings to change their behavior. >> Inertia is a powerful thing. So let's say >> As they say that, first we form habits, then habits form us. >> There you go. >> And that's how it happens. You create some habit and then you become prisoner of that habit. If you create that and you can't get rid of it. But you just have to force yourself out of it. >> Right, and this is a forcing function, like none other in terms of this whole world. >> Exactly. >> So, shifting gears a little bit to kind of your day job, beyond just leading but actually worrying about security. RSA was the last big show we went to, late January, early February. All about security, Hacker One's all about security. I would imagine now that everybody's working from home and the pressure on bringing your own devices and we're seeing all this funny stuff about Zoom. It's the greatest thing since sliced bread. And now of course everybody's jumping on all of the vulnerabilities, etc. What are you seeing in kind of the hacker world and security world as this huge shift has moved to people working from home and remote schools, etc. >> Well, it's clear that society now has to work from home and figure out distributed ways of getting education or work done. And as a result, criminality will go there as well. So we have to protect ourselves well. The first of the problems is, how do you protect yourself when you work from home? So then you talk about VPNs and how do you handle credentials and authentication and multi factor authentication to make sure that the connection is authentic and protected. So, that's the first one. The first order challenge that we have right now going on. But on a little bit longer scale, we are seeing now companies deciding to start using cloud services even more than before, because they realize that this could come back as evasion like, we are having now, could come back and you will again be at home. And then they say, how do we build our software and ICT infrastructure, such that we are not needed in the office? And the answer is move to the cloud. And when you move to the cloud, you again, the security posture changes somewhat. You don't have to worry about network security anymore, but you do have to worry much more about app sec, application security. So, whatever happens here, they are useful transitions, but they will put demands on security teams and business leaders to re-evaluate what they spend money on in security. We are very fortunate at Hacker One to be on the winning side here. Our services are exactly for this distributed virtual digital world. So, we are needed even more every day more and more because things are going online. But companies will need to rethink those things and stop spending on things that don't make sense anymore. >> Yeah. It is just wild, right? How this forcing function is really making everybody evaluate things a little bit closer and pushing them through that inertia that before you could kind of put it off, put it off, put it off. You can't put it off anymore. Time's now. >> Right. >> Yeah. >> Well, we had a similar like when Y2K happened. We also had a hard limit, and we had to get stuff done. Now it's coming in a different way, sort of the punishment came without announcement, but we are in a similar crunch to get it done. And we will. >> Yeah. But, it will be difficult and it will put a lot of strain to people under the systems. But I do believe it's doable. >> Good. So, I want to shift gears one last time. We talked really about open source. >> Right. >> You've built your career on open source. My SQL was obviously open source and got bought by Sun eventually now, part of Oracle's portfolio then you did Eucalyptus. That was open source, right? Eventually got bought by hp. And now Hacker One, you're using really a network of hackers all over the world, to really help deliver the service. I'm just curious to get your take on the role of open source. It's been such a creative force for development. It's been such a creative force for kind of moving technology forward. How do you see it playing out now? What's the role of open source? Are you seeing projects? Are you seeing people rallying around, bringing the power of data and analytics and cloud to this problem? Cause to me, there's clearly a human toll of people being sick. But it's also a big data problem in terms of resource allocation, trying to sequence this thing and accelerate vaccine development. There's a lot of kind of big data, opportunities here to attack this thing. >> I think open source is even bigger now than it used to be. And it is a very powerful example of the fact that no matter how much we are threatened that we feel like we have to hunker down and isolate ourselves from others and foreign groups or people are dangerous. In reality, the biggest accomplishments in society are always about collaboration by large groups of really intelligent driven people. Because software is eating the world, open source is eating the world. And today, if you don't use open source software, you're just plain stupid. So, it has really taken over the whole world. And it is now enabling all these new innovations and initiatives that we didn't do before in big data, collecting big data, analyzing data. We see it in the whole area of DNA medicine, where the researchers are sharing their findings with everybody. And that's very much like open source software. They don't call it open source software, but the mechanisms are the same. Everybody is doing it for their own good, but by sharing it, they multiply the value of what they did, and it speeds up innovation, so that it outperforms anything done in a closed laboratory or a closed source company. So it's wonderful to have been part of the open source revolution because it is spawning so many other initiatives and phenomena on a societal level. And this is just the beginning. It will go into politics, it will go into news, it will go into the assessment of fake news. Reddit is completely self moderate. They don't hire the moderators. The moderators are provided by the community and they self moderate. And understanding how to self govern, self moderate, at very large scale. That's the key to success in many areas. So, open source software is enormous and yet, it's just one little part of the whole world of community driven innovation. >> Right. Such a great lesson though, because, as we think back to kind of the last kind of national rally around say, World War Two, where Kaiser started building ships, and Ford was building airplanes. And we've got some of that going on with with Elon Musk, and people building respirators and some of these physical things, but there's this whole kind of software and big data, AI, machine learning thing that's happening on the background, around the genome and in the vaccine development that's not quite as visible, but really such an important part of this battle that we haven't seen. And then, of course, the other place is no place to hide. The fact that this is happening all over the globe, at the same time to everyone, regardless of your religion, your politics, your geography. It's really a unique moment in time. Hopefully one that we're not going to... >> It could be our best hope against Coronavirus. The fact that the scientists are right now working together and sharing their findings, quickly going from one test to the next and figuring out what works. And mankind hasn't had that capacity before. But now we do. So, we can't know whether it will take a long time or a short time, but at least we are getting all the resources to bear and we put them together and people share. >> Right. >> Which is what's driving the innovation here. >> Right, Martin. I guess, just a last kind of topic before I let you go, kind of circling fully back to leadership. One of the comments you talked about, about these types of times really favoring the bold. I really liked that line that is, don't be scared. It's really an opportunity for the people who have it together and are making the right priorities, to shine and to really kind of rise above the fray. I wonder if you can share a little bit more your thoughts about that from a leadership point of view. It's a time of challenge, but it's really also a time of opportunity. >> I think it's exactly like you said. It's like the Stockdale paradox. Admiral Stockdale who was a prisoner of war, over seven years, and was tortured during those years. Every day, he decided to, on one hand, be ready to face any brutal reality he might face, but on the other hand, never give up hope that one day, he will come out and have no regrets, not looking back and be a free man again. And that's exactly what happened. Of course, we are not in as dire situation as he was, but society has a similar situation. That we must have the courage to face the exact brutality of and the reality of coronavirus right now, without thinking that we won't come out of it. We will absolutely come out of it. And we will come out of it with innovations and new models that will outshine whatever we had before. And we must be able to maintain this duality of, okay, I'm ready to face the reality and I'm ready to be in isolation, I'm ready to use a face mask, whatever it takes. But also, I will never give up hope about what will come once we come out of this. And with that mindset, as a company, as a family, an individual human being or a society, you can get through any problem. And this is what Admiral Stockdale taught us through his experience, and by sharing it with everybody. >> Well, Marten. Thank you for sharing that story, and thank you for sharing your experience and kind of your point of view. We really appreciate it. These are tough times and it's great to be able to look out to the leaders and to kind of share the burden, if you will, and hear from smart folks that have a point of view. So, thank you very much for your time. Best to your employee. Glad that person is recovering. And as you said, we will get through this and we'll come out stronger the other side. Thanks a lot. >> Absolutely. Thank you, Jeff. Good chatting with you. >> All right, thanks Marten. Jeff Rick here, signing off from the Palo Alto studios from the CUBE. Thanks for watching. We'll see you next time. (soft music) (soft music)

>> From theCUBE studios in Palo Alto in Boston, connecting with our leaders all around the world, this is theCUBE Conversation. >> Hello everyone, and welcome to this week's Wiki Bond CUBE Insights powered by ETR. In this breaking analysis, we're changing the format a little bit, we're going right to the new data from ETR. You might recall that last week, ETR received survey results from over 1000 CIOs and IT practitioners. And they made a call at that time, which said that actually surprisingly, a large number of respondents about 40% said they didn't expect a change in their 2020 IT spending. At the same time about 20% of the survey said they're going to spend more largely related to Work From Home infrastructure. ETR was really the first to report on this. And it wasn't just collaboration tool like zoom and video conferencing. It was infrastructure around that security, network bandwidth and other types of infrastructure to support Work From Home like desktop virtualization. ETR made the call at that time, that it looked like budgets, were going to be flat for 2020. Now, you also might recall consensus estimates for 2020 came into the year at about 4%, slightly ahead of GDP. Obviously, that's all is changed. Last week, ETR took the forecast down, and we're going to update you today. We're now gone slightly negative. And with me to talk about that again, is Sagar Kadakia, who's the Director of Research at ETR. Sagar, great to see you again, thank you for coming on. >> Thanks for having me again David, really appreciate it. >> Let's get right into it. I mean, if you look at the time series chart that we showed last week, you can see how sentiment changed over time. That blue line was basically people who responded to the survey starting at 3/11. Now you've updated that, that forecast, really tracking after the COVID-19 really kicked in. Can you explain what we're seeing here in this chart? >> Yeah, no problem. The last time we spoke, we were around an N or sample size of about 1000. And we were right around that zero percent growth rate. One of the unique things that we've done is we've left this survey open. And so what that allows us to do is really track the impact on annual IP growth, essentially daily. And so as things have progressed, as you look at that blue line, you can really see the growth rate has continued to trend downwards. And as of just a day or two ago, we're now below zero. And so I think because of what's occurring right now, the overall current climate continues to slightly deteriorate. You're seeing that in a lot of the CIOs responses. >> If you bring that slide back up Andrew, I want to just sort of stay on this for a second. What I really like about what you guys are doing is you're essentially bringing event analysis in this. So if you see that blue line, you see on 3/13, a national emergency was declared and that's really when the blue line started to decline. What ETR has done is kind of reset that, reset the data since 3/13. Because it's now a more accurate reflection of what's actually happening happening in the market. Notice in the upper right, it says the US approved... The Senate last night approved a stimulus package. Actually, they're calling it an Aid Package. It's really not a stimulus package. It's an aid package that they're injecting to help. A number of our workers actually sounds like existing workers and small businesses and even large businesses like Boeing. Boeing was up significantly yesterday powering the Dow and potentially airlines. As you can see ETR is going to continue to monitor the impact, and roll this out. Really ETR is the only company that I know of anyway, that can track this stuff on a daily basis. So Sagar, that event analysis is really key, and you're going to be watching the impact of this stimulus slash aid packet. >> Yeah, so here's what we're doing on that chart. If you look at that yellow line again, effectively what you're seeing is, if we remove the first I think six or seven 100 respondents that took the survey and start tracking how budgets are changing as a 3/13, that's when the US declared a national emergency. We can recalculate the growth rate. And we can see it's around... It's almost negative one and a half. And so the beauty of doing this, really polling daily, is it allows us to be just as dynamic, as a lot of these organizations are. I think one of the things we talked about the last time was some of these budget changes are going to be temporary. And organizations are figuring out what they're doing day by day. And a lot of that is dictated based on government actions. And so uniquely here, what we're able to do is kind of give people a range and also say, "based on these events, "this is how things are changing."" And so I think we think the first biggest event was on 3/13, where the US effectively declared a national emergency over COVID-19. And now what we're going to start tracking between today and over the weekend, and Monday is: Are people getting more positive? Is there no change? Or is there further deterioration because of this aid package that got passed this morning? >> Now I want to share with our audience. I've been down to ETR's headquarters in New York, it's staffed with a number of data scientists and statistical experts. The ends here are well over 1000. I think we're over 1100 now, is that correct? What is the end that we're at today? >> That's right. Yeah, we're we're pushing right over 1200. And we're going to expect a few more hundred respondents. The good thing is it's balanced, which is important. All these events that are occurring, we want to make sure that we have at least a few hundred more CIOs and IT executives answering. And so every week as we kind of continue to do some of these breaking analysis, there are going to be a few more hundred CIOs. And we'll really be able to zero in or hone in on what they're saying. The growth rate on the IT side, it's going to continue to fluctuate. It's going to continue to be dynamic over the next few weeks, but right now versus (murmurs). We are in negative territory now. >> I want to also explain I mean, the end is important. But in and of itself, it's not the be all end all, what's important about the end, the larger it is, the more cuts you can make. And I want to share... You guys have been doing this for the better part of a decade. And so you have firm level data. And you've got indicators and markers that you've tracked over the years. For example, one of the things that ETR tracks is Giant Public and Private GDP we call it. And that's for example, I'm not saying that, that Mars is one of the companies but Mars is a huge private company, UPS before they went public, huge private company. ETR tracks firm level data, they of course anonymize that, but they can see markers and trackers and trends, and probably have, I don't know dozens of those types of segments. So the bigger the end is, the more... The higher the end within those buckets, and the better the confidence interval. And you guys are experts at really digging into that in trying to understand and read the tea leaves. >> That's right. The key to this survey is, it's not anonymous, we know who is taking the survey. Now to your point, we do anonymize and aggregate it when we display those results. But one of the unique capabilities is we're able to see all of these trend lines. The entire drill down survey that we did on COVID-19 through the lenses of different verticals so we can take a look at industrials materials manufacturing, healthcare, pharma, airlines, delivery services, health, and all these other verticals and get a feel for which ones are deteriorating the most, which ones look stable. And, we talked about last week and it continues to remain true this week. And again, the ends have gone up on all these verticals on the supply chain side. Industrials, materials manufacturing, healthcare, pharma, they continue and they also anticipate to see these things in the next few months, broken supply chains and on the demand side, it's really retail consumer airlines delivery services. That's coming down quite substantial. And I think, based on what United and some of these other airlines have done these last few days in terms of cutting capacity, that's just a reflection of what we're seeing. >> Let's dig into the data a little bit more and bring up the next chart. Last week, we're about 40% actually, exactly 40% where that gray line that said: CIOs and IT practitioners said, "no change." They're like the budget of the green. The green was actually at about 20 21%. So it's slightly up now at 22%. And you can see, most of the the green is in that one to 10% range. And you can see in the left hand side, it's obviously changing. Now we're at 37% in the gray line, slightly up in the green, and a little bit more down and in the red. So take us through what's changed Sagar. >> Yeah, to reiterate what we were talking about last week, and then I'll kind of talk about some of the change is, I think the market and a lot of our clients, they were expecting the growth rate to be more negative. Last week when we talked about zero percent. The reason that, it wasn't more negative is because we saw all these organizations accelerating spend because they had to keep employees productive. They don't want to catastrophe in productivity. And so you saw this acceleration, as you mentioned earlier in the interview around Work From Home tools, like collaboration tools, increasing bandwidth on the VPN networking side, laptops, MDM, so forth and so on. That continues to hold true today. Again, if we use the same example that we talked about last week, (mumbles) organizations, they have 40 50 60,000 employees or more working from home. You have to be able to support these individuals and that's why we're actually seeing some organizations accelerate spend and the majority organizations even though they are declining spend, some of that is still being offset by having to spend more on what we're calling kind of this Work From Home infrastructure. But I will say this: you are seeing more organizations versus last week, which is why the growth rate has come down, moving more and more towards the negative buckets. Again, there is some offset there. But the offset we talked about last week, Work From Home infrastructure is not a one-for-one when it comes to taking down your IT budget, and that continues to hold true. >> Let's talk a little bit about some of the industries retail, airlines, industrials, pharma, healthcare, what are you seeing in terms of the industry impact, particularly when it relates to supply chains, but other industry data that went through? >> I think the biggest takeaway is that healthcare pharma, industry materials, manufacturing organizations, they've indicated the highest levels of broken supply chains today. And they think in three months from now, it's actually going to get worse. And so we spoke about this last time, I don't think this is going to be a V shaped recovery from the standpoint of things are going to get better in the next few weeks or the next month or two. CIOs are indicating that they expect conditions to worsen over the next three months on the supply chain side and even demand the ones that are getting hit the hardest on the retail consumer side airlines, delivery services, they are again indicating that they anticipate demand to be worse three months from now. The goal is to continue serving and pulling these individuals over the next few weeks and months and to see if we can get a better timeline as we get into two edge but for the next few months, conditions look like they're going to get worse. >> I want to highlight some of the industries and let's make some comments here. Retail... You guys called out retail airlines, delivery services, industrials, materials, manufacturing, pharma and healthcare, there's some of the highest impact. I'll just make a few comments here. I think retail really, this accelerates the whole digital transformation. We already saw this starting, I think you'll see further consolidation and some permanence in the way in which companies are pivoting to digital. Obviously, the big guys like Walmart and the like are competing very effectively with Amazon. But, there's going to be some more consolidation there. I would say potentially the same thing in airlines that really are closely watching what the government is going to do. But, do we need this this many airlines? Do we need all this capacity? Maybe yes, maybe no. So watching that. And of course, healthcare right now, as I said last week in the braking analysis, they're just too distracted right now to buy anything. And they're overwhelmed. Now, of course, pharma, they're manufacturing, so they've got disruptions in supply chain and obviously the business. But there could be an upside down the road as COVID-19 vaccines come to the market. >> On the upside, I think you kind of hit it, right on the nail. When you get these type of events that occur. Sometimes it speeds up digital transformation. one of the things that the team and I have been talking about internally is: this is not your father's Keep The Lights On strategy so to speak. Organizations are very focused on maintaining productivity versus significantly cutting costs. What does that mean? Maybe three to five years ago, if this had occurred, you would have seen a lot of infrastructure as a service platform, as a service... A lot of these cloud providers, you'd have seen those projects decline as organization spent more on on plan. And we're not seeing that. We're seeing continued elevated budgets on the Cloud side and Micron just reported this morning and again, cited strong demand on the Cloud and data center side. That just goes to show that organizations are trying to maintain productivity. They want to continue these IT roadmaps and they're going to cut budgets where they can, but it's not going to be on the Cloud side. >> You know what, that's a really important point. This is not post Y2K, not 2008, 2007, 2008, 2009 because we've, pretended but a 10 year bull market, companies are doing pretty well, balance sheets are generally strong. They somewhat in whether, it was used to stronger companies, whether they're so they're not focused right now anyway, on cut cut cut as it was in the last few downturns. Let's go into some of the vendor data and some of the sector data, Andrew if you'd bring up the next chart. What we're showing here is really comparing the the blue is the January survey to the current survey in the yellow, and you're seeing some of the sectors that are up taking. You've identified mobile device management, big data and Cloud, some of the productivity, you mentioned DocuSign, Adobe zoom, Citrix, even VMware with the desktop virtualization. We've talked about security, you've got marketing and LinkedIn, my LinkedIn inbound is going through the roof as people are probably signing up for a LinkedIn premium. Let's talk about this a little bit. What you're seeing... Help us interpret this data. >> Yeah, sure. One of the things that everybody wants to know is, okay, so Work From Home infrastructures getting more spend for the vendors that are benefiting the most. One of the unique things that we can do is because we're kind of collecting all the DNA, from a tech stack aside from these organizations, we can overlap, how they're spending on these vendors. And also with the data that they provide in terms of whether they are increasing or decelerating their IT budgets because of COVID-19. What you're looking at here, is we isolated to all of those organizations and customers that indicated that they're increasing their budgets because of COVID-19. Because of the Work From Home infrastructure. And what we're doing is we're then isolating to vendors that are getting the most upticks in spend. This actually really nicely aligns with a lot of the themes that we were talking about collaboration tools. You see that VMware, they're all right on the virtualization side, MDM with Microsoft. And you're seeing a lot of other vendors with Citrix and Zoom and Adobe. These are the ones that we think are going to benefit from this kind of Work From home infrastructure movement. And again, it's all very... It's not just the qualitative and the commentary. This is all analytics, we really went in and analyzed every single one of these organizations that were increasing their budgets and tried to pinpoint using different data analysis techniques, and to see which vendors were really getting the majority or the largest, pie of that span. >> We had Sanjay Poonen, who's the CEO of VMware on yesterday and he was very sensitive but not trying to hear as your ambulance chasing because obviously they do desktop virtualization and VDI big workload. At the same time. I think he was also being cautious because there's probably portions of their business that are going to get hit, Michael Dell similarly, I think he was quoted in CRN as saying, "hey, are we seeing momentum in our laptop "business in our mobile business?" But as you guys pointed out, the flip side of that is their on prem business is probably going to suffer somewhat. It's a kind of like the Work From Home is a partial offset, but it's not a total offset. You're seeing that with a lot of these companies. Obviously, Microsoft, AWS, a lot of the cloud companies are very well positioned, how about some of the guys that are going to get impacted? Obviously, as I said that the on-prem folks, you guys talked about earlier it's not your father's Keep Your Lights On strategy. Okay but this... You asked the question, is this a reprieve for the legacy guys? Not quite, was your conclusion. What did you mean by that? >> I think a lot of times when you have these sub-events, the clients a lot of the market think okay, "some of the legacy vendors are going to do well "because, we're in malicious times, "and we don't want to keep on this kind "of next generation strategy." We're not seeing that and to the point that you highlighted earlier. There are... Even though these companies like Dell, like Cisco, where they're seeing some products accelerate, there are products to your point that are not doing as well The desktops, right? As an example for Dell or the storage. On the negative side or the legacy side where we're just not seeing any traction, the IBM's the Oracle on-prem, Symantec, which got acquired by Broadcom, checkpoint MicroStrategy. And there's another half dozen other vendors that we're seeing where they are not capitalizing. There is no reprieve for these legacy names. And we don't anticipate them getting additional spend, because of this Work From Home infrastructure kind of movement. >> Let's unpack that a little bit. It's interesting Symantec and checkpoint in security, security you think would get an uplift there, but what you're seeing here is... Let me just tell the audience who you called out. Symantec Teradata MicroStrategy, NET app Checkpoint Oracle and IBM, and I know there are others. But I would say this: These are companies that are getting impacted in a big way by the Cloud. Particularly like Symantec and checkpoint. That's a Cloud security companies are actually probably still doing pretty well. You take Teradata, their data is getting impact by the Cloud from folks like Snowflake and Redshift, MicroStrategy a lot of modern BI coming out. NetApp here's a company that's embraced the Cloud, but the vast majority of the business changess to be on-prem. I think IBM and Oracle are interesting. They're somewhat different. Actually a lot different IBM has services exposure, and you guys call that out, particularly around outsourcing. At the same time, it's going to be interesting to see IBM is going to get a lot of resources. Going to be interesting to see if they start coming out with corona virus related services. So watching for that, and then Oracle, their whole story is, "okay, we got Gen 2 Cloud and Mission Critical in the Cloud, but they're on-prem businesses, I think clearly going to be affected here is kind of what you guys pointed out, and I would agree with your thoughts. >> I think what we're seeing is organizations they had a Cloud roadmap, and that roadmap is continuing. The one thing that is changing in some of that roadmap is we need to be able to support employees as they work from home as we achieve this roadmap. And so that's why we're not seeing a reprieve on the legacy side. But we are seeing upticks and spin where we just wouldn't anticipate them right on maybe on Citrix, on Dell laptops, Adobe and a few other areas. Now, in terms of security side, some of the next gen security vendors like CrowdStrike APi, which is an MFA, those vendors are doing well. It makes sense, where you have more people working from home, you have more devices that are connecting to data applications. Just a component itself. And so you would expect spend to continue going up as you need more authentication, more Endpoint Protection. Cisco Meraki they do Cloud Networking. That piece is looking very good, even though Hardware networking is not looking very good at all. The Cloud Networking is looking good, which again makes sense, as you're increasing bandwidth on that side. >> Definitely stories of two sides of that coin. >> That's right >> I want to... Andrew, if you want to... If you wouldn't mind bringing up the next job, we're going to go back to the first one that we showed you with the time series. This is a very important point. Again, we can't stress it enough. We want to understand the impact of the stimulus or aid package. And ETR is going to continue to track that. What can we expect from you guys over the next week or so? >> The goal is to determine whether or not the stimulus is having an impact on how people are responding to our survey as a relates to how they're changing their budgets. The next four or five days, if we start seeing an uptick in this yellow and blue lines here, I think that's a positive. I think that shows that people are kind of wrapping their heads around, great government is taking action here. There is a roadmap in place to help us get out of this. But if the line continues coming down, it just may be that the last few weeks or the last month or so, there was just so much damage. There's not really... There's no coming back from this at least in the near term. So we are kind of watching out for that. >> Well, the Fed is definitely active. >> They're doing right what they can, they're pushing liquidity into the marketplace. People think out of bullets. I don't agree with the Fed. Fed has a quite a bit of of headroom and some dry powder, (murmurs) which is awesome. But the Fed itself, can't do it. You needed to have this fiscal stimulus. So we're excited to see that come to market. I think what I would say to our audiences, my concern is uncertainty. The markets don't like uncertainty and right now there's a lot of uncertainty. If you saw the piece on medium of The Hammer And The Dance it lays out some scenarios about what could happen to the healthcare system. You see people who say, "hey, we should shut down for 10 weeks." The president saying, "hey, we want "to get back to work by by April." The big concern that I have is: okay, maybe we can stamp it out in the near term and get back to work by late April, early May. But then what happens? Are people going to start traveling again? Are people going to start holding events again? And I think there's going to be some real question marks around that. That uncertainty I think, is something that we obviously have to watch. I think there is light at the end of the tunnel, when you look at China and some of the other things that are happening around the world, but we still don't know how long that tunnel is. I'll give you final thoughts before we wrap. >> I think and that's the biggest thing here is the uncertainty, which is why we're doing a lot of this event analysis. We're trying to figure out: after each one of these big events, is there more certainty in people's responses? And just we were talking about, sectors and verticals and vendors that are not doing well. Because the uncertainty we're seeing a lot of down ticks and spend amongst outsource IT and IT consulting vendors. And as long as the uncertainty continues, you're going to see more and more IT projects frozen, less and less spend on those outsource IT and IT consulting vendors and others. And until there's something really in place here where people feel comfortable, you're going to probably see budgets remain where they are, which right now they're negative. >> Folks as we said last week, Sagar and I, ETR is committed, theCUBE is committed to keep you updated on a regular basis. Right now on a weekly cadence. As we have new information, we will bring it to you. Sagar, thanks so much for coming on and supporting us. >> You're welcome and thanks for having me again. >> You're welcome. Thank you for watching this CUBE Insights powered by ETR. And remember all these breaking analysis available on podcast, go to etr.plus that's where all the action is in terms of the survey work. siliconangle.comm covers these breaking analysis and I published weekly on wikibond.com. Thanks for watching everybody. Stay safe. And we'll see you next time.

>>  Welcome back to theCUBE everybody. This is a special digital presentation sponsored by Oracle Consulting. We go out to the events, we extract the signal from the noise and we're going to multiple locations to really try to understand better the rebirth of Oracle Consulting. Stephanie Trunzo is here. She is the head of transformation and offerings at Oracle consulting North America. Stephanie, good to see you. >> Yeah, good to see you. >> Okay so we talked about sort of the mission of Oracle Consulting, now let's get into it and talk about some of what the customers are seeing. There's this theme in the industry that Gartner brought up about Bimodal IT and you guys are talking about Trimodal IT, so what is that all about? >> Well, two wasn't good enough so we had to add a third. (laughs) So Bimodal IT, two speed IT, the idea there is a lot of modern enterprises are struggling with this challenge between the systems of record that they have that have to be sources of truth. They're often slow to change. There's a lot of rigger around transforming those systems of record. And then on the second side, on the Bimodal side, there are the systems of interaction or systems of engagement, they're sometimes called. And those systems are things like the applications where there's users, customers at the other end. And they need to move at the speed of business. And so the idea of Bimodal IT and what a lot of our clients are struggling with currently is how do you serve both of those needs at the same time? There's complications in the processes, the tools, and certainly in the budget. And at the same time, there's kind of looming out there, this threat almost, that if you aren't in the AI NML data driven world yet, you're going to fall behind. And so our clients are struggling with the fact that they have not yet successfully addressed Bimodal IT, but still have to figure out how to get into this AI space. So our third system, hence Trimodal IT is the systems of intelligence. And that's what we've added. >> So, to make sure I've got the Bimodal right, >> Yeah sure. >> Is that, You've got people who are handling the systems of record you said. And so they have knowledge, they've got tribal knowledge, deep expertise, which may not be widespread. Kids coming out of school don't necessarily have that same expertise. And then there's sort of the systems of engagement kind of the new fun stuff. Did customers in your sense, buy into that? Or did they try to sort of cross-pollinate, as practitioners? >> Yeah they do buy into it. But they're really still struggling with the idea of Bimodal IT without even getting into the third system yet. So they are buying into it. The challenge, it's not even really about buying into it. It's addressing the challenge, because they have to overcome this legacy stuff, that they have in their system in order to address the speed of business. >> So the third piece, obviously relates to machine intelligence, AI, NML. It seems like that type of capability would apply to both systems of record and systems of engagement. Is that how you're looking at it? >> Yes, and so the Trimodal IT concept is kind of three different systems and how they interlock and relate to one another. If you think about systems of record, the currency, so to speak, for system of record are processes. If you think about the currency for systems of interaction it's the people, it's the users, it's the humans. And the currency for the system of intelligence is data, to your point. So when you're talking about systems of intelligence, collecting and leveraging data from all three systems is going to be what fuels your system of intelligence going forward. >> And that's the common thread between all three. And it just seems to me, that is ultimately the underpinning of modernization. I wonder what your customers, how do they view, and how do you view modernization? >> So the awesome thing about being at Oracle is data is our DNA. That's where Oracle started from, that's where we still are today is data underpins everything we do, all of the technology that we build is built on the understanding that it must be data-driven. And so when we're looking at all three of those systems and you're looking at it from an Oracle perspective, data is at the heart of even systems of record. Even systems of interaction, not only the systems of intelligence. When our clients are looking at modernization, they are trying to figure out a way to kind of leapfrog this story and get the whole way to a place where they are getting intelligence and insights out of their data. They're not just unlocking it. They're not just moving workloads in a lift and shift kind of model. They're doing it, because they want to serve the ultimate outcome that they get smarter as a business. >> So data is kind of like raw material, the AI or machine intelligence allows you to take data and create insights, if you will. And then cloud gives you scale and agility and all of those things. So Cloud's again another fundamental piece of, just from an infrastructure standpoint, and I think you guys define Cloud as sort of an experience, not a place. So it includes the on prime workloads, of course. So, talk about Cloud. Customers want to go from where they are today, to some outcome, some end point. And they don't want to spend a zillion dollars. And they don't want to disrupt their business. They are going to have to make investments, clearly. How do they get from point A to point B on that Cloud journey? >> So we've built something called a Cloud evolution framework. That Cloud evolution framework has several different phases and stages. And it's intended to be a skeleton to have that conversation with clients. Are you thinking about all of the things that you need to consider to make a healthy decision that has a real road map behind it. To your point on budget, and this is part of the Trimodal IT conversation is. They're struggling, I've talked to so many CIOs who are struggling to figure out. I right now am spending, 90% of my spend is on maintenance of systems versus on innovation. So how do I shift that spending story to something that is actually going to move the needle on getting the business ahead. That's going to serve my stakeholders, who are the lines of business, in a way that is not additive to my budget. But actually a shift of the budget. So we're looking at it from a Cloud perspective, helping our clients make that monetary shift. Make the shift of the budget where they're self-financing their own innovation by getting smarter and faster on moving their workloads to the Cloud. >> That's interesting, I want to come back to that self-financing. It reminds me of Y2K where you had all these activities going on, and the boom times. And then people wanted to go through an application rationalization exercise so they could self-fund really the innovation. >> Stephanie: Right. >> And when you're in the tenth year of a boom cycle, here. I wonder if there are similar things going on. Is that where the self-funding comes in? >> That's exactly it. So, I kind of use this example as a way of helping people consume and understand this. Marie Kondo, KonMari method is a popular, she wrote a best-selling book. She's on Netflix. The premise of her concept is helping to declutter your life. And her premise is you should hold each object in your hand and say, "Does it bring me joy?" And if it does, I'm going to keep it. And if it doesn't, I'm going to thank it for it's service, and get rid of it. And so we're talking to our clients about something very similar. You said, rationalization exercise and it's precisely the same thing. We're kind of using the KonMari method, if you will, to help our clients make those determinations. What are the things that they still need? What are the things that they can de-commission? What are the things that can stay where they are? And you don't have to do anything with, because they are serving the purpose just fine. >> Yeah, we're kind of hoarders by nature, and creatures of habit, so you have all these applications that nobody's using, but you're still spending maintenance and-- >> Stephanie: Correct. >> Keeping them up and it may not be delivering, and many aren't delivering value to the organization. So you want to double down on those that do. You guys use this concept and other do as well, of the autonomous enterprise. You have the autonomous database, I wonder if we could drill into that. Get passed the buzz words. What is the autonomous enterprise and what is Oracle's fit there? >> Yeah, I think one of the big misconceptions when people here autonomous, is that they think it means without people. And that's not right. (laughs) So, autonomous means that you're helping elevate all the parts of the system to their highest value. Which means, you don't need to worry about security patches. You don't need to worry about repairing things on the database. Those kinds of autonomous things is the technology helping heal and serve itself. That doesn't mean you don't need people anymore. What it means is two things. You need the experts that can help make sure that you're optimizing the value you get out of the autonomous tooling, but it also means that the humans are now freed up to do different kinds of high value work. So, an autonomous enterprise would be one where they're really sort of self-actualized. In the sense that their technology is feeding itself. It's getting smarter, and they're getting insights out of that, so that the people in their business are as valuable as they can be, leveraging the insights from the technology. >> So I can see how that trickles into IT. No questions about it. Can the autonomous IT organization trickle into the autonomous enterprise? And I mean I know it's sort of early days, but how do you see that shaping up? >> So, these kind of transformations, I believe are fundamentally across the whole company. And this is true at Oracle as well. We have something called Oracle@Oracle. And it's about drinking our own champagne and applying our own technology in house. So it's not just in an IT organization capacity. It's across HR, Procurement, Legal, every supporting function you can imagine. So that cultural change bleeds out across the entire body of the company. And I believe fully that if you're going after something like an AI mission or an autonomous enterprise state, which is an evolution that you need to involve everyone in the company in different roles. >> So what's that future state look like? >> I think the future state looks like a place where you're not just getting incremental gains on business processes or tasks that already exist. You're fundamentally seeing shifts in the way the business runs itself, as a result of the technology learning and getting smarter. And the people who are benefiting from that technology changing the way they operate in the company as well. >> So you mentioned the sort of decluttering example before, which I love, I'm getting that book. And are there other examples that inspire you? >> There are. So there was an anecdote, a client told me this story, which is a fantastic story, kind of triggered a thought for me. Told a story about a guy who was retiring. And at his retirement dinner, he told a story that 30 years ago when he started at the company. He remembers his dad teaching him, how to use the application that he then spent his entire career building and maintaining. As I heard that story, and they jokingly said at this point, our only solution is to get him out of retirement or find his son. (laughs) I thought about that, and I thought about 23 and me. You know 23 and me? >> Yes. >> So it's a DNA testing, tells you your heritage, lineage. And we're kind of at a state now, where a lot of our enterprise clients legitimately have these systems of record applications that are generations old, human generations old. So getting into the weeds on what that looks like, I've been telling clients pretty often lately. Institutional knowledge is the enemy, right? It's the enemy of the autonomous enterprise. If you have a challenge where you keep referring to the same name (laughs). If Bob leaves, we're in big trouble. If Sally isn't here anymore, that's a trigger for you to know that that's something you need to pay attention to. Because that institutional knowledge is not getting built into your technology. >> So what do you guys do? Do you put some kind of abstraction layer around that system of record, so that it can be automated? Is that part of what you do? >> Sure. So we're looking at, there's a couple different ways you can go about it. So you can look at the systems of record as a partial move that you do over time to the Cloud. And so you have to be pretty smart about the pattern and how you do that. Moving the workloads, kind of whole, will give you a little bit of that self-financing ability to dig in deeper and start transforming them. >> Okay, Trimodal IT. We'll be watching. (laughs) All right, Stephanie, thanks so much. It was great to see you. >> Absolutely, thanks. >> And thank you for watching. You're watching theCUBE at the special digital presentation. We'll be right back after this short break. (upbeat electronic music)

from Chicago it's the cube covering Oracle transformation day 2020 not to you by Oracle consulting welcome back to the queue of everybody this is a special digital presentation sponsored by Oracle consulting we go out to the events we extract the signal from the noise and we're going to multiple locations to really try to understand better the rebirth of or consulting Stephanie trunzo is here she's the head of transformation and offerings at or consulting North America Stephanie good to see you yeah good to see you okay so we talked about sort of the mission of Oracle consulting now let's get into it and talk about what some of the customers are seeing there's this you know theme in the industry the Gartner brought up about bimodal lights yeah you guys are talking about trimodal eyes yeah so what is that all about well ii wasn't good enough so we had a third so bimodal IT two-speed IT the idea there is a lot of modern enterprises are struggling with this challenge between the systems of record that they have that are have to be sources of truth they're often slow to change there's a lot of rigor around transforming those systems of record and then on the the second side on the bimodal side there are the systems of interaction or systems of engagement they're sometimes called and those systems are things like the applications where there's users customers at the other end and they need to move at the speed of business and so the idea of bimodal IT and what a lot of our clients are struggling with currently is how do you serve both of those needs at the same time there's complications in the processes the tools and certainly in the budget and at the same time there's kind of looming out there this you know threat almost that if you aren't in the a IML data-driven world yet you're going to fall behind and so our clients are struggling with the fact that they have not yet successfully addressed by modal IT but still have to figure out how to get into this AI space so our third system hence trimodal IT as the systems of intelligence and that's what we've added so should I get the bimodal right yes that you know people that are handling the the systems of record you said hmm and so they have knowledge they got you know tribal knowledge yes DJ BIA which may not be you know widespread it's not kids kids coming out of school don't necessarily have that that same expertise and then there's sort of the systems of engagement kind of the new fun stuff did customers in your sense buy into that or did they try to sort of cross pollinate as practitioners yeah they they do buy into it but they're really alright they're still struggling with the idea of bimodal IT without even getting into the third system yet and so they are buying into it the challenge I don't it's not even really about buying into it it's addressing the challenge because they have to overcome this legacy stuff that they have in their system in order to address the speed of business so the third piece obviously relates to machine intelligence AI nml it seems like that type of capability would apply to both systems of record and systems of engagement is that is that how you're looking at yes and so the trimodal IT concept is kind of three different systems and how they interlock and relate to one another if you think about systems of record the currency so to speak for systems of record or processes if you think about the currency for systems of interaction it's the people it's the users it's the humans and this is the currency for the system of intelligence is data to your point so when you're talking about systems of intelligence collecting and leveraging data from all three systems is going to be what fuels your system of intelligence going forward and that's the common thread between you know all three and it just seems to me that is ultimately the underpinning of modernization I wonder what do your customers how do they view and how do you view modernization so the awesome thing about being at Oracle is data is our DNA that's where Oracle started from that's where we still are today is data underpins everything we do all of the technology that we build is built on the understanding that it must be data driven and so when we're looking at all three of those systems and you're looking at it from an Oracle perspective data is at the heart of even system a record of even systems of interaction not only the systems of intelligence when our clients are looking at modernization they're trying to figure out a way to kind of leapfrog this story and get the whole way to a place where they're getting intelligence and insights out of their data they're not just unlocking it they're not just moving workloads and a lift and shift kind of model they're doing it because they want to serve the ultimate outcome that they get smarter as a business so data is kind of like raw material the AI or machine intelligence provides it allows you to take data and create insights if you will and then cloud gives you scale and agility and all those things so so clouds again another fundamental piece of just from an infrastructure standpoint and I think you guys define cloud as sort of an experience not a place so includes the on-prem workloads of course so talk about cloud customers want to go from where they are today to somehow become some ending point and they don't want to spend a zillion dollars and they don't want to disrupt their business they're gonna have to make investments clearly how do they get from point A to point B on that cloud journey so we've built something called a cloud evolution framework that cloud evolution framework has several different phases and stages and it's intended to be kind of a skeleton to have that conversation with clients are you thinking about all of the things you need to consider to make a healthy decision that has a real roadmap behind it to your point on budget and this is part of the trimodal IT conversation is there struggling I've talked to so many CIOs who are struggling to figure out I right now I'm spending you know 90% of my spend is on maintenance of systems versus on innovation so how do I shift that spending story to something that's actually going to move the needle on getting the business ahead that's gonna serve my stakeholders who are the lines of business in a way that is not additive to my budget but actually a shift of the budget and so we're looking at from a cloud perspective helping our clients make that monetary shift make the shift of the budget where they're self financing their own innovation by getting smarter and faster on moving their workloads to the cloud it's a - I want to come back to that self financing via y2k where you had all these activities going on in the boom times and then people wanted to go through an application rationalization exercise yes it could self fund really the innovation right and we're in a tenth year of a boom cycle here I wonder are there similar things going on is that where the self funding comes in that's exactly it so you know I kind of used this example as a way of helping people consume and understand this Marie Kondo konmari method is a popular she wrote a best-selling book she's on Netflix the premise of her concept is helping to declutter your life and her premises you should hold each object in your hand and say does it bring me joy and if it does I'm going to keep it and if it doesn't I'm gonna thank it for its service and get rid of it and so we're talking to our clients about something very similar you said rationalization exercise and it's precisely the same thing we're kind of using the konmari method if you will to help our clients make those determinations what are the things that they still need what are the things that they can decommission what are the things that can stay where they are and you don't have to do anything with because they're serving the purpose just fine yeah we're kind of hoarders by nature in creature habit so you have all these applications that nobody's using but you're still spending maintenance and correct keeping them up and and they may not be delivering and in problem any aren't delivering value for the organization so you want to double down on those that do you guys use this concept and others do as well of the autonomous enterprise you have autonomous database I wonder if we could you know drill into that get past the buzz words what is the autonomous enterprise and and what's Oracle's fit there yeah I think one of the big misconceptions when people hear autonomous is that they think it means without people and that's not right so autonomous means that you're helping elevate all the parts of the system to their highest value which means you don't need to worry about security patches you don't need to worry about repairing things on the the database those kinds of autonomous things is is the technology helping heal and serve itself that doesn't mean you don't need people anymore what it means is two things you need the experts that can help make sure that you're optimizing the value you get out of autonomous tooling but it also means that the humans are now freed up to do different kinds of high-value work so an autonomous enterprise would be one where they're really sort of self actualized in the sense that their technology is feeding itself it's getting smarter and they're getting insights out of that so that the people in their business are as valuable as they can be leveraging the insights from the technology so I can see how that trickles into IT no question about it can can the autonomous IT organization trickle into the autonomous enterprise and I mean I know it's early days but how do you see that you know shaping up so the these kinds of transformations I believe are fundamentally across the whole company and and this is true at Oracle as well we have we have something called Oracle at Oracle and it's about drinking our own champagne and applying our own technology in-house so it's not just in an IT organization capacity its across you know HR procurement legal every supporting function that you can imagine so that cultural change bleeds out across the entire body of the company and I believe fully that if you're going after something like an AI mission or an autonomous enterprise you know state which is an evolution that you need to involve everyone in the company in different roles so what's that future state look like I think the future state looks like a place where you're not just getting incremental gains on business processes or tasks that already exist you're fundamentally seeing shifts and the way the business runs itself as a result of the technology learning and getting smarter and the people who are benefiting from that technology changing the way they operate in the company as well so you mentioned the hood decluttering example yeah which I love are there other examples that inspire you there are so I there was an anecdote a client told me this story which is a fantastic story kind of triggered a thought for me a told a story about a guy who was retiring at his retirement dinner he told a story that thirty years ago when he'd started at the company he remembers his dad teaching him how to use the application that he then spent his entire career building and maintaining as I heard that story and they jokingly said at this point our only solution is to get him out of retirement or find his son I thought about that and I thought about 23andme have you know yes so it's a you know kind of DNA testing tells you your heritage lineage and we're kind of at a state now where a lot of our enterprise clients legitimately have these systems of record applications that are generations old human generations old so getting into the weeds on what that looks like I've been telling clients pretty often lately institutional knowledge is the enemy right if and it's the enemy of the autonomous enterprise if you have if you have a challenge where you keep referring to the same name you know if Bob leaves we're in big trouble if Sally isn't here anymore that's a trigger for you to know that that's something you need to pay attention to because that institutional knowledge is not getting built into your your technology so what do you guys do you put some kind of abstraction layer around that system of Records so that it can be automated does that part of sure so so we are looking at there's a couple different ways you can go about it so you can look at the systems of record as a partial move that you do over time to the cloud and so you have to be pretty smart about the pattern and how you do that moving think the workloads kind of whole will give you a little bit of that self financing ability to dig in deeper and start transforming them ok trimodal IT will be watching hey Stephanie thanks so much it's great yeah absolutely Thanks thank you for watching you watching the queue at this special digital presentation we'll be right back right after this short break

>> Live, from Barcelona Spain, it's theCube! Covering, KubeCon CloudNativeCon Europe 2019: Brought to you by RedHat, the Cloud Native Computing Foundation and the Ecosystem Partners. >> Hi, and welcome back. this is theCube's coverage of KubeCon CloudNativeCon 2019 here in Barcelona, Spain. We're at the end of day one of two days of live, wall-to-wall coverage. I'm Stu Miniman, and at the end of the day, what we try to do always is do our independent analysis and say what we really think. And joining me is someone that usually has no problem telling you exactly what he thinks online. So, I've challenged Mr. Corey Quinn. Cloud economist, of the Duckbill Group. and the curator, author, Last Week in AWS. To tell us what he actually thinks. >> Well, Stu, you know what your problem is. All the best feedback starts off that way. Now, this has been a fascinating experience for me. This is the first time I've ever been to KubeCon. I didn't quite know what to expect- >> It's KubeCon, not Koob-Con. Come on. It is in GitHub, how you have to make the pronunciation correct. >> We are on theCube. We would think that we would be subject matter experts on this. >> CNCF will be cracking down on you if I don't correct you on this. >> I still maintain we're in Barcelona, Italy. But that's a whole separate argument to have with other people. >> Yes, well, most Americans are geographically challenged. And we understand you have some challenges too. >> Exactly, most Americans need to learn geography, we go to war. (chuckling) >> All right, so, Corey, I guess the first question for you is, you usually go to mostly AWS shows. Most of the customers we've talked to have been AWS customers. So is this feeling much different from the usual show you go to? >> The focus of the conversations is different, and to be clear, I'm not much of a cloud partisan myself. I deal with AWS primarily because, not for nothing, that's where my customers are. That tends to be exactly where the expensive problems tend to live. For better or worse. If that changes, so will I. >> So, you're saying yet that the other cloud providers don't have their customers big enough bills, or they just haven't figured out how you might be able to help them in the future? >> To be very honest with you. Yes, is the short answer. Right now on aggregate, my customers spend about a billion dollars a year on AWS. I don't see the same order of magnitude on other providers, but it's coming. It is very clearly coming. None of these providers are shrinking as far as size goes. It's largely a matter of time. >> Alright. But Corey, I hope at least you've understood that Kubernetes at the center for all things. And that multi-cloud is the way that we are today and will always be in the future. And we should all hold hands and sing along, that we all get along. Is that what you've learned so far? >> I think that's absolutely what I've learned so far. It comes down to religion and it's perfectly name for it. I mean, Kubernetes was the Greek God of spending money on cloud services. >> All right. But seriously. Corey, I think one of the things that I really liked is. We talk to customers and there were some interesting things at least I heard when you talked about they see huge value in what they're doing with Kubernetes. Many of them only have one cloud provider today. Yet they are choosing to lay on Kubernetes either with AWS or with another solution there. What's been your take of what you've heard about. Kind of the why and what they're doing? >> There've been a few different reasons on it. One that resonated with me did validate what I talked about at the beginning of the day. Which was, that by trying to position yourself to be strategically amenable to any potential provider you might want to use in the future. You are sacrificing velocity. And you're gaining agility, losing velocity to do that. Is that trade off worth it? I don't think I'm qualified to judge. I think that's a decision every business has to make on its own. My argument has always been that if that's the decision you make, do it knowingly. And I don't think we've talked to anyone who's made that unknowingly today. >> Yeah. I think that's a really good point. What is it, you know, surprised you or interest you that we've heard so far? >> I have to be honest. I have a long and storied history in open source. I was staff at the Freenode IRC network for about a decade. Which was an interesting time. And I've seen a lot of stuff, but I don't think I've ever seen two open source projects merge before. The fact that we saw that today is still swirling around in my head for better or worse. >> Yeah. And it was OpenCensus and OpenTracing coming together. Open Telemetry. So, definitely check out Ben Siegelman. and it was Morgan McLean from a Google cloud. You know, really interested in discussion. I don't think we're sharing too much when we say off camera. There were like, look, it's like, yes, they got us in a room and we worked, but we'll try not to throw punches here on the set and everything like that. We understand that look, there are people that put these things together and you have smart people that build things the way that it should be done. And these were not like two very similar projects going in the same direction, they were built with different design principles and therefore there'll be somethings that they all need to reconcile to be able to go forward. But yeah, very interesting. >> And everyone we spoke to today was very focused on what the needs of their customers, whoever they happen to be and how to meet those customers and their business requirements. There's no one that we spoke to that was sitting here saying, oh, this is the right answer because it is technically correct. The answer is we're always of the form. This is what we need to do in order to serve customers. And it's very hard to argue against that strategy. >> All right, but none of this really matters because Serverless, right Corey? >> Oh, absolutely. Serverless is the way and the light of the future and to some extent I believe that. >> But they're not doing Serverless. I'm pretty sure they're half a step behind you. Yes, it tends to be, it's easy to make go ahead and die and say, Oh, if you're not running the absolute latest bleeding edge thing, you're behind, you're backwards, etc. And I don't get that all the sense that that is reality. I think that there's, if you're building something greenfield today, you are fundamentally going to make different choices, than if you have something you're trying to carry forward. And I don't just mean carrying forward a technical sense. I mean carrying it forward in terms of process, in terms of culture, in terms of existing business units that need to modernize. People are moving in the same general direction. The question that I think is still on answered is, today, there's a perception rightly or wrongly, that Containers are slightly behind Serverless. I don't know that that necessarily holds true. I think that they are aligned towards the same business value. I think, judge either one of them by today's constraints in the context of longer term strategy is a mistake. I'm curious to see what happens. >> Corey, I love. So we had Jeff Brewer from Intuit and they were like look, we're doing Serverless, we're doing a lot of Containerless stuffs and I'd love it for my developer not to have to worry about. And they've had been moved down that path. So, we know one of the truisms out there is everything in IT is always additive. When you talk to them and say, oh, well I'm going into cloud wait, I still have some stuff that, running on my main frame or my eyes series. And that we'll probably be running there when I've retired. We were talking offline. It's like, well, there's been a little resurgence in COBOL. Just because it did not die after Y2K and so did these things always come back and it's always additive and the longer you've been in business as a company, the more legacy you need to be able to maintain and extend and connect to where you want to go with the future. >> It's almost a sawtooth curve. As complexity continues to rise it becomes to a point where it's untenable. There's something that comes out that abstracts that away and you're back down to a level a human being might actually be able to understand. And you take it a step further and you start to see it again and again and again, and then it collapses down. Docker and a lot of the handbuilt orchestration systems were like that. And then Kubernetes came out. Initially it was fairly simple and then things have been added to it now. And I think we're climbing that sawtooth curve again. Whether or not that maintains? Whether or not that simplifies again? I find that history rhymes particularly in tech. >> Well yeah and I always worry sometimes when you talk about the abstraction layer you got to be really careful what you're abstracting. What we see here a lot, is a lot of times it's people, how can I just consume that? I want to buy it as a service and somebody take care of that not, it hides the complexity for me but some of the complexity is still there. >> Right. So our site is now intermittently slow what do you plan to do? Its update my resume immediately cause we're never untangling that Gordian knot of an infrastructure. That's not a great answer but it is an honest one in some shops. >> I've talked to, we know that there was, for a long time people outsourced what they were doing. And we need to make sure that when you're buying something as a service that you haven't outsourced, That you understand what's important to your business, what happens when things go wrong. We had some discussion today about, networking and observability that we need to be able to go down that rabbit hole, at least turn to somebody who can. Because just because I can't touch that gear doesn't mean my next not on the line, If something goes wrong. >> You can outsource a lot of work. You can't outsource responsibility. I put slightly more succinctly, the line I've always liked was you own your own availability. If you have a provider that you've thrown a lot of these things over to and they go down, well sure you're going to have loud angry phone calls and maybe a few bucks back from an SLA credit. We your customers we're down and we're suffering. So the choices you made impact your businesses perception in the market and your customer's happiness. So as much as fun as it is to be able to throw things over the wall for someone else to deal with, you're still responsible. And I think that people forget that at their own peril. >> One of the things I like. I've got a long history in open source to. If there are things that aren't perfect or things that are maturing. A lot of times we're talking about them in public. Because there is a roadmap and people are working on it and we can all go to the repositories and see where people are complaining. So at a show like this, I feel like we do have some level of transparency and we can actually have realism here. What's been your experience so far? >> I think that people have been remarkably transparent about the challenges that they're facing in a way that you don't often get at a vendor show. Where you have a single vendor, you're at their show, regardless of who that might be. You're not going to be invited back if you wind up with a litany of people coming on a video show or a podcast or screaming and sobbing in the bathroom, however you want to, whatever your media is. Just have a litany of complaints the entire time or make that provider look bad. I don't sense that there's any of that pressure. And for some reason, and this is my first coop gone, so maybe this is just the way this culture it works. Everyone, regardless of who they worked for or what they're working on or what their experience has been, seems happy. I can only assume there's something in the water. >> All right. Well, I've just been informed that the CNCF had asked me to remove Corey because he refuses to say KubeCon. But, Corey. Since this might be your last time on the program, any other final words that you have for it or I will let you do something very rare and if you have any questions for me. Love on my way. >> Absolutely. What did you find today that you didn't expect to find? >> The one that jumps out for me really is two things. One, we discussed it already is the, the observability piece coming together. The other one is. You talk about that maturation of where Amazon fits in this ecosystem. And we had lovely conversation, with Abby fuller. But not just that one. We talked to the users and how they think about it. Which is what really matters is, there's so much talk about, who contributes more code and who does the most here. But look, we're talking cloud. Most of these customers are using AWS as if not the cloud, one of the clouds. I've set it on theCube many times. When you live in a hybrid and multi-cloud world and the public cloud, AWS is the far leader. There's no debating that. So they are participating here. They are doing plenty for what their customers want and they give choice and they listen to the feedback. So that was interesting to me that maturation of where that sits because when I come into the show and many times it is, it is the open source in this whole ecosystem, trying to prevent Amazon from taking over the world. And look, we want a good robust ecosystem out there. >> We absolutely do. >> While I have many friends that work for Amazon. We probably don't want to all be working for a single company down the road. >> I certainly don't. >> We like a nice robust ecosystem where there is choice out there and that keeps its (mumbles). So that maturation of where they are on has been interesting to me so far, especially from the user stand point. >> Very much so. I don't think that anyone wants to look back and say, wow, I'm sure glad we have only one option in this entire space that does anything useful. And then a whole bunch of could have the didn't. And for better or worse, I don't think that the future is nearly as clear cut as the past of cloud. Historically, AWS has been the 800 pound gorilla. I think that we hearing fascinating things from GCP and from Azure. I don't necessarily think that the future is preordained. I do think right now it is AWS game to lose, but I'm starting to see a lot of other players in his face start to make a lot of very interesting and arguably very correct moves. >> All right. Well, we know you as our audience have lots of places where you can turn to find your information and we are always pleased that when you turn to us to watch theCube. if you have any feedback for ourselves, Corey Quinn and myself, Stu Miniman. Reach out on Twitter. We are easy to reach on that. And we have lots of posts. So if you're like, Hey, tired of looking at this mug here. Let us know. But hopefully we're asking the questions and digging into the areas that you want and we'll help your businesses going forward. So we are at the end of day one, Two days live coverage here at KubeCon CloudNativeCon. This is the cube. 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