(lively music) >> Welcome back everyone to theCUBE's live coverage in San Francisco for VMware Explorer 22 formerly VMworld, Dave 12 years we've been covering VMware's annual conference. Going next level explores bigger theme, Multi-cloud another inflection point for VMware. And again at the center of it is the partners Zia Yusuf is here senior vice president strategic ecosystem and industry solutions. You're the, you're, you got the keys to the kingdom for VMware, welcome to theCube. >> It's a pleasure, I mean, you guys are a legend here. This is my first time here. So, it's a pleasure and excited to chat with you. >> Well, great to have you, every single year, since 2010 we've always had great commentary and discussion and sometimes contentious discussion around the role of partners. Visa V, VMware's value proposition, VMware dominant and the enterprise data center, everyone knows that. Dominant and hybrid was first there, everyone knows that. Now going to the next level, the customer stay, they stay with VMware, they don't really leave. They still got a great loyal base but now the enterprise is going NextGen cloud native. The partners are energized with the conversations we're hearing is huge. There's changes of roles is clarity on value proposition. Monetization is hoppin'. It's great stuff, what's going on? You're new, but you have a view of this before. Take us through your what's going on in the partner network, what's the state of the union? >> Yeah, I think, thanks for the question. I think maybe just step back a second right, the word partners is a big word. It covers all kinds of things. VMware has had a rich history of partnerships you know, mostly technology related partnerships. So much of our products depend on other partners, OEM partners, and so on. We've also had a rich history of our channel. So, as you look at different channel partners as you look at going through different parts of the segment SMB and so on, in a cloud context, based on what's happening we needed to take an integrated ecosystem approach. That's the word I use, right. And for me it's, it's a little bit like a spider's web. Like no single strand in the web is that strong but when you put it together thoughtfully in a very deliberate way. That's what an integrated ecosystem strategy. And so we've got our VCP partners, longstanding history that machine continues. We've got our channel partners and OEM partners that machinery continues obviously Dell strategic partner, significant business. The parts of the puzzle that I've been focusing on is five other different pieces. So first of course, is our hyper scale partnerships long history with AWS, very successful history. We have GCVE with GCP. We announced, I think three, four months ago that GCP was joining our VMware cloud universal and a big announcement yesterday about Microsoft doing the same. And hopefully we extend that. So, as we work with this hyper scaler six or seven of these partners, it's a, as you can imagine kind of a multidimensional chess game, if you will a little bit competitive mostly cooperative and stuff, right. The GSI is very exciting piece of it. The essentials that Deloitte, Deloitte announced a new business unit on VMware, ACL did the same. That energy level has really gone up. You see it at the show here as well. We recognize that these significant SI's play a huge role in the decision making process with customers. And we want to enable them to build significant VMware businesses. It's a different game from that perspective. Last thing I'm point out is, industry and verticals. Right I mean, this is not being necessarily an area because of the layer of the stack we've been in. Obviously Telco is an end to end business unit for us. We have products, we have a go to market on Telco, public sector to some degree because you need all these three letter agencies and the security and compliance. But as you look at financial services as you look at retail, as you look at healthcare we need to be aware of the workload we need especially on modern apps, especially on the edge. So we kind of doubling down on some of our vertical capabilities. So, all of those things are connected as well, right. The SI to the hyper scale partners in a vertical context. >> What's the biggest change that you've seen? Because we've observed some partners are leaning out as they change their business. And VMware has got new partners coming in, leaning in. So you got mentioned, Dave mentioned Telco and you got new use cases with edge and multi-cloud so you know, some people kind of maybe age out or change their strategy, some double down the core partner network, and then new ones come in. What's been the biggest change, if you can look at that holistically? >> Yeah, it's a great question, right? Because it's so multidimensional and there is no such thing as a GSI global system because they build products. Sometimes they act as a reseller, they're a solution provider. Also they provide services. So as their business model changes, we have to adjust how we engage with them. We can't put them in nice clean buckets. And that's what I'm doing with my colleagues here is how do we really enable them? And one of the things, I mean, I've done this type of stuff, I was at SAP for many years. We need to figure out how do we make them successful? Not just, this is what VMware wants you to do. We need to understand their business model and how do we fit into that? 'Cause if they grow, then we grow with that. And that is honestly a little, it's a subtle point, but it's a little bit of a nuanced. >> Yeah, it's very nuanced, but you have to nail that. You got to overlay. >> 100% >> The strategy where the enablement is technically or product wise, economics and conflict. (John laughing) >> And profitably, if they're profitably is important to us it's not just their growth. >> So Zia, I want to test the premise on you, something, John and I have been working on this notion of super cloud. And we did an event earlier this month, but one of the aspects that's kind of nuance and futuristic is if I'm a, let's say a financial services company and I'm going through a digital transformation I would be looking strategically at what, say Amazon did taking it's internal IT and then pointing at the world. I would say, I have data. I have tools, I have software, I have expertise that's really unique and could be value add. And I would be thinking, how do I monetize that, create my own cloud. And I'm actually just going to throw it into a public cloud to do that. I've got mainframes running, I've got Oracle stuff on Prem. I'm not going to shift that stuff into the cloud and maybe some of it, but I've got transaction systems and proprietary data. And a lot of it is running on VMware and I've got cloud stuff too. I would be looking at, okay, how do I build my own cloud and put my data, my tooling, my software in front of a new ecosystem, my own ecosystem that I can you know monetize. Are you seeing- >> Without spending the CapEx. >> Yeah, without having to build data centers? Right, exactly. I want to take advantage of the gift that the hyper scalers are given. Are you seeing any activity bubbling up in that regard? >> It's a really, it's a really interesting question. And I think the terminology that we've used around cloud smart kind of goes into that. So let me take what you said. >> Okay please, yeah. >> And frame it in a slightly different way. You can standardize on public clouds and everybody's using the same thing. You're using the same services, and so on. Theoretically that could lose some of your differentiation. Right, I mean, especially for financial services companies that have built so much of their you know, trading test down to the milli, milli, millisecond and how do they do that, and so on. So, I think you have something there right. So, as they look at their technology and software strategy, yes there's cost reduction aspects of it. There's refactoring aspects of it that hygiene that needs to be done as Rughu talked about from this cloud chaos to cloud smart, if you will but then how do you differentiate on the business processes? How do you differentiate that then down into the workloads? And I think that's where to use an old term. It takes a village, right, you've got the system integrator that's providing this stuff. You've got other strategy firms like the BCGs and McKinseys of the world that have huge influence now. Then you've got technology players that are coming into that. And I think the cloud smart approach is to do exactly what you're saying. It's not just the refactoring, it's not just movement to the cloud. How do you retain your competitive edge from the processes the models, the thinking that you've built up over many years. So, I don't know if it's super cloud or what that means, but that at the end of the day, this is about business processes. At the end of the day, this is about having a competitive edge in the market and I think you could do it. >> It's industry cloud, right? >> It's, that's a good way to put it. >> Yeah. >> I think Industry cloud is a good way. >> Why is there security cloud, Why isn't there an insurance cloud? Why's there a FinTech cloud? So I mean if you look at Goldman Sachs capital one. >> Right. >> There, CapEx is handled by AWS. Snowflake built their entire business on AWS. Didn't spend the dime on CapEx. Well, they spent a lot of operating expense for that CapEx and the fees, but still they became successful. And then the rest is history. So, I think people are seeing this idea of I'll ride that back on the CapEx of the hyper scalers and then use the tooling from the partner network and what's available. To then, cobble together in an architectural engineered way, distributed computing way, a new way to do things. Okay, so if you believe that, which we do, then you say, oh, it's on the balance sheet. So, what we've been hearing from companies is like, "Hey it's going to be on the balance sheet", I better have an income statement impact on the top line. So, you start to see behavior change at the customers not IT powering the business and the back office and terminals and some app. >> Crosscutting. >> It's like, no, no, no this is a digital business. So, the integration of balance sheet income statement on the economics is driving a lot of the behavior at the customers. So we see customers thinking this way and it's like we've never seen this level of business model refactoring as well as partner vendor selection, product technology mix at the same time. >> And VMware. >> At this level. >> Need the connective tissue between the hyper scalers in the ecosystem and actually provide those cross cloud connections. >> Yeah. >> You know, to the extent there's a business case there, that's what we're trying to of squint through. Is it going to be hybrid with on-prem in one cloud or is there an advantage of going cross clouds beyond just avoiding lock in you know, to take advantage of global infrastructure? >> So and then the next question is the Tam then bigger which means the partners are better? >> Yeah right. >> Participate in that. >> Yeah, I think, and we look at economics of this, right? I mean, there's a huge emphasis on cost, right. Cost, and I completely get that. I think, as I've talked to customers both now that I'm here but before advising a range of companies the innovation process, the time to impact is equally important all right as you compete. There's no point in just getting your cost down. If you're then getting beaten up in the market and you're not able to differentiate with new digital services. And this is where call it super cloud, call it industry cloud. We need to connect up to the business processes and the business impact and not just in my view the cost infrastructure piece of it. >> Yeah. And that we can't do on our own, we're not an apps company. So we're, you're not SAP, we're not Oracle, but we need to work with those players to make sure that their workloads are optimized in the right cloud in the right configuration. And that is a job to be done as opposed to just let's take it to town. >> And there's clearly a technology business case, especially if we're working with companies like VMware who's going to help me you know, simplify. >> Right. >> My move to the multi-cloud but there's also a business and economic impact in that. Even if it's not, if it could be simple as if I partner with Microsoft I'm going to do more business right if I'm one of these industry clouds. So I see that as another potential tailwind, it's really, it's like when Dreesen says all your companies are software companies, to me all companies are cloud companies, now increasingly. >> Look the difference between cloud and apps and then stuff, I mean like. >> Yeah, it's all. >> It's like you know there's used to be infrastructure and then apps company and so on. We need to deliver with our ecosystem partners and integrated solution and solution with a big S not just the technology solution but the broader, I mean look at the change management. >> Yeah, yeah. >> We talked about culture, I mean, if you don't get that piece right and the change management piece. >> Everything, yeah. >> You know the rest of it is history. >> Well and it's got to be delivered as a service, >> It has to be. >> Which is huge implications as to how you deal with change management. >> And this goes back to my kind of first comment is I really try and think of this by architecting the ecosystem. I don't like the word alliances. Right I mean, let's say kind of a one to one relationship. You know, let's do an agreement, let's go have dinner, but architecting the ecosystem the spiders web, who are the different players how can we compliment each other? And if it, Deloitte and a Microsoft want to do amazing business together related to VMware technology I want to encourage that. And so those third party Connections. >> You guys your contextualizing the ecosystem, basically. And I think from a customers standpoint that's a benefit to them, in my opinion in fact, Dave, remember at our supercloud.world event URL supercloud.world is the plug for the site. They can check it out. One of the comments from the cloudarati panel was we had a title this session called the innovators dilemma you know question mark you know . >> Best book ever written. >> Yeah, yeah. And so the, one of the panels said, it shouldn't be, we should change it to the integrators dilemma because what's happening is that integration is now standard table stakes and, but integrating the right things now matters, right? So, integration for integration sake isn't necessarily the end game anymore. >> And this is where. >> And this kind of where you're getting at with the spider's web is that integrating properly is a solution mindset. >> And look, I'm integrating also, you know have to bring in data from that perspective. Right, at the end of the day data being the new oil, if you will, the integration allows that data to flow to the right place at the right time to make the right decision. Now, we are not doing all of those pieces but we are certainly enabling that. And as you especially start looking at what we can do on the edge and what we can do in a retail store and a factory and so on those kinds of things come together. >> Okay, Zia take some time. We got a couple minutes left, only two minutes left, I want you to get some commentary directly to the audience around what specifically you're doubling down on. That's new that you're investing in on the partner network or your partner strategy. What is a steady state that's being nurtured and farmed or whatever word you want to use, but here's our core thing. Here's the area of improvement we're going to be in you know, cranking the handle on take us through that. >> Sure. >> I know you got OAM, got telco, got new things going on. >> Yeah so, maybe a couple of things right. >> lay it all out. >> First of all it has to be linked to VMware strategy. So as we transition on this journey to subscription saas ARR, we need to bring our ecosystem along to do that. That has business model implications that has implications on how we engage with them, how we define success how we value things. So that's an important journey. Secondly, is we need to do a better job of enabling our partners. Right, I mean, we have our partner connected. We do a pretty good job on the channel side. We need to do a better job on the GSIs is really understanding their business model, how they're engaging with their customers and provide them the technology the support, the financial resources, so that they can be successful. That's very important. Third is, to connect the dots on the ecosystem, right? I mean it's a, I've spent a lot of time in this event as well in joint meetings between system integrators and hyper scalers with our technology colleagues on Intel or NetApp or AMD. And these are companies that we have a rich history with. We're trying to connect, because that's how customers look at it. So, connecting the dots between the ecosystem super important to us, and then look, there's a change management journey within VMware. We also need to understand how we can engage with partners in a more productive, effective way. How do we scale this up? I believe, I think our leadership in Raghu and Sumit we are not going to succeed unless we have a profitable, engaged, passionate ecosystem around. >> Yeah I mean, they got to make money. They got to. >> Exactly. >> Be successful, have successful customers, their end customers your customers. Well, all good, question of where you're investing the most right now. If you had to put a kind of the pie chart together, I mean some of it's steady state like it's a machine, some of it's new like Telco for instance I mean here's. >> I think again, rich history on the channel side, we continue to invest there. Very valuable to go do that. I think some of these newer areas around the system integrators, especially the large ones, the Whipple's the HCLs, Deloittes essentials of the world, very important. The hyper scaler relationships directly leads into ARR. You saw the VMC cloud Universal will continue. >> We have Google on great props from Google. >> Yeah, We love it you guys. >> Yeah, and so look, I think we are not multi-cloud unless we go do this. Right I mean, Raghuram made a joke about this. We were single cloud and now we're multi-cloud, we want our customers to be able to procure these integrated solutions through VMware and our hyper scaler partners will continue to do that's when multi-cloud really become. And so the GTM motion, the discounting the commission structure all of that machinery is an important radio for me. >> Zia thank you so much for coming on theCube. I know you've been super busy. You got to go out and hit all the partners say hello, compressing you know, got to hit the pavement, say hello to everyone. >> It's been fantastic, the partners have too many, too many parties and so. (Interviewers laughing) But that's a fun part of my job, but appreciate your time. >> You got good stamina. >> Thanks Zia. >> So you got to have that in this game. Not about the faint of heart here at VMware. Zia thank you for coming on. >> Of course. >> This is the cube coverage, back after lunch. After the short break day two of three days of live coverage here in Moscone West on the street floor level of the event I'm John Furrier with Dave Alante. We'll be right back. (lively music)

>>from around the globe. It's the Cube presenting Cuban cloud brought >>to you by silicon angle. Okay, we're back. Here. Live Cuban Cloud. And this is Dave. Want with my co host, John Ferrier Were all remote. We're getting into the analyst power half hour. Really pleased to have Maribel Lopez here. She's the principal and founder of Lopez Research and Zias Caraballo, who is the principal and founder of ZK research. Guys, great to see you. Let's get into it. How you doing? >>Great. How you been? Good, >>thanks. Really good. John's hanging in there quarantining and, uh, all healthy, So I hope you guys are too. Hey, Mary, But let's start with you. You know, here we are on 2021 you know, just exited one of the strangest years, if not the strangest year of our lives. But looking back in the past decade of cloud and we're looking forward. How do you see that? Where do we come from? Where we at and where we going >>When we obviously started with the whole let's build a public cloud and everything was about public cloud. Uh, then we went thio the notion of private cloud than we had hybrid cloud and multi cloud. So we've done a lot of different clouds right now. And I think where we are today is that there's a healthy recognition on the cloud computing providers that you need to give it to the customers the way they want it, not the way you've decided to build it. So how do you meet them where they are so that they can have a cloud like experience wherever they want their data to be? >>Yes and yes, you've, you know, observed, This is well, in the early days of cloud, you heard a lot of rhetoric. It was private cloud And and then now we're, you know, hearing a lot of multi cloud and so forth. But initially, a lot of the traditional vendors kind of pooh poohed it. They called us analysts. We said we were all cloud crazy, but they seem to have got their religion. >>Well, everything. Everyone's got a definition of cloud, but I actually think we are right in the midst of another transformation of clouds Miracle talked about. We went from, you know, private clouds, which is really hosting the public cloud to multi cloud hybrid cloud. And if you look at the last post that put on Silicon Angle, which was talking about five acquisition of Volterra, I actually think we're in the midst of the transition to what's called distributed Club, where if you look at modernized cloud apps today, they're actually made up of services from different clouds on also distributed edge locations. And that's gonna have a pretty profound impact on the way we build out, because those distributed edges be a telco edge, cellular vagina. Th whatever the services that lived there are much more ephemeral in nature, right? So the way we secure the way we connect changes quite a bit. But I think that the great thing about Cloud is we've seen several several evolutionary changes. So what the definition is and we're going through that now, which is which is pretty cool to think about, right? It's not a static thing. Um, it's, uh, you know, it's a it's an ongoing transition. But I think, uh, you know, we're moving into this distributed Cloudera, which to me is a lot more complex than what we're dealing with in the Palace. >>I'm actually pretty excited about that because I think that this move toe edge and the distribution that you've talked about, it's like we now have processing everywhere. We've got it on devices, we've got it in, cars were moving, the data centers closer and closer to where the action's happening. And I think that's gonna be a huge trend for 2021. Is that distributed that you were talking about a lot of edge discussion? You >>know what? The >>reason we're doing This, too, is we want. It's not just we're moving the data closer to the user, right? And some. If you think you brought up the autonomous vehicle right in the car being an edge, you think of the data that generates right? There's some things such as the decision to stop or not right that should be done in car. I don't wanna transport that data all the way back to Google him back to decide whether I want to stop. You could also use the same data determine whether drivers driving safely for insurance purposes, right? So the same data give me located at the edge or in a centralized cloud for different purposes, and I think that's what you know, kind of cool about this is we're being able to use our data and much different ways. Now. >>You know, it's interesting is it's so complex. It's mind blowing because this is distributed computing. Everyone kind of agrees this is where it is. But if you think about the complexity and I want to get your guys reaction to this because you know some of the like side fringe trend discussions are data sovereignty, misinformation as a vulnerability. Okay, you get the chips now you got gravitas on with Amazon in front. Apple's got their own chips. Intel is gonna do a whole new direction. So you've got tons of computer. And then you mentioned the ephemeral nature. How do you manage those? What's the observe ability look like? They're what's the trust equation? So all these things kind of play into it. It sounds almost mind blowing, just even thinking about it. But how do you guys, this analyst tryto understand where someone's either blowing bullshit or kind of like has the real deal? Because all those things come into play? I mean, you could have a misinformation campaign targeting the car. Let's say Hey, you know that that data is needs to be. This is this is misinformation who's a >>in a lot of ways, this creates almost unprecedented opportunity now for for starts and for companies to transform right. The fundamental tenet of my research has always been share shifts happen when markets transition and we're in the middle of the big one. If the computer resource is we're using, John and the application resource will be using or ephemeral nature than all the things that surrounded the way we secured the way we connect. Those also have to be equal, equally agile, right, So you can't have, you know, you think of a micro services based application being secured with traditional firewalls, right? Just the amount of, or even virtual the way that the length of time it takes to spend those things up is way too long. So in many ways, this distributed cloud change changes everything in I T. And that that includes all of the services in the the infrastructure that we used to secure and connect. And that's a that is a profound change, and you mentioned the observe ability. You're right. That's another thing that the traditional observe ability tools are based on static maps and things and, you know, traditional up, down and we don't. Things go up and down so quickly now that that that those don't make any sense. So I think we are going to see quite a rise in different types of management tools and the way they look at things to be much more. I suppose you know Angela also So we can measure things that currently aren't measurable. >>So you're talking about the entire stack. Really? Changing is really what you're inferring anyway from your commentary. And that would include the programming model as well, wouldn't it? >>Absolutely. Yeah. You know, the thing that is really interesting about where we have been versus where we're going is we spent a lot of time talking about virtual izing hardware and moving that around. And what does that look like? And that, and creating that is more of a software paradigm. And the thing we're talking about now is what is cloud is an operating model look like? What is the manageability of that? What is the security of that? What? You know, we've talked a lot about containers and moving into a different you know, Dev suck ups and all those different trends that we've been talking about, like now we're doing them. So we've only got into the first crank of that. And I think every technology vendor we talked to now has to address how are they going to do a highly distributed management and security landscape? Like, what are they gonna layer on top of that? Because it's not just about Oh, I've taken Iraq of something server storage, compute and virtualized it. I now have to create a new operating model around it. In a way, we're almost redoing what the OS I stack looks like and what the software and solutions are for that. >>So >>it was really Hold on, hold on, hold on their lengthened. Because that side stack that came up earlier today, Mayor. But we're talking about Yeah, we were riffing on the OSC model, but back in the day and we were comparing the S n a definite the, you know, the proprietary protocol stacks that they were out there and someone >>said Amazon's S N a. Is that recall? E think that's what you said? >>No, no. Someone in the chest. That's a comment like Amazon's proprietary meaning, their scale. And I said, Oh, that means there s n a But if you think about it, that's kind of almost that can hang. Hang together. If the kubernetes is like a new connective tissue, is that the TCP pipe moment? Because I think Os I kind of was standardizing at the lower end of the stack Ethernet token ring. You know, the data link layer physical layer and that when you got to the TCP layer and really magic happened right to me, that's when Cisco's happened and everything started happening then and then. It kind of stopped because the application is kinda maintain their peace there. A little history there, but like that's kind of happening now. If you think about it and then you put me a factor in the edge, it just kind of really explodes it. So who's gonna write that software? E >>think you know, Dave, your your dad doesn't change what you build ups. It's already changed in the consumer world, you look atyou, no uber and Waze and things like that. Those absolute already highly decomposed applications that make a P I calls and DNS calls from dozens of different resource is already right. We just haven't really brought that into the enterprise space. There's a number, you know, what kind of you know knew were born in the cloud companies that have that have done that. But they're they're very few and far between today. And John, your point about the connectivity. We do need to think about connectivity at the network layer. Still, obviously, But now we're creating that standardization that standardized connectivity all the way a player seven. So you look at a lot of the, you know, one of the big things that was a PDP. I calls right, you know, from different cloud services. And so we do need to standardize in every layer and then stitch that together. So that does make It does make things a lot more complicated. Now I'm not saying Don't do it because you can do a whole lot more with absolute than you could ever do before. It's just that we kind of cranked up the level of complexity here, and flowered isn't just a single thing anymore, right? That's that. That's what we're talking about here It's a collection of edges and private clouds and public clouds. They all have to be stitched together at every layer in orderto work. >>So I was I was talking a few CEOs earlier in the day. We had we had them on, I was asking them. Okay, So how do you How do you approach this complexity? Do you build that abstraction layer? Do you rely on someone like Microsoft to build that abstraction layer? Doesn't appear that Amazon's gonna do it, you know? Where does that come from? Or is it or is it dozens of abstraction layers? And one of the CEO said, Look, it's on us. We have to figure out, you know, we get this a p I economy, but But you guys were talking about a mawr complicated environment, uh, moving so so fast. Eso if if my enterprise looks like my my iPhone APs. Yes, maybe it's simpler on an individual at basis, but its app creep and my application portfolio grows. Maybe they talk to each other a little bit better. But that level of complexity is something that that that users are gonna have to deal >>with what you thought. So I think quite what Zs was trying to get it and correct me if I'm wrong. Zia's right. We've got to the part where we've broken down what was a traditional application, right? And now we've gotten into a P. I calls, and we have to think about different things. Like we have to think about how we secure those a p I s right. That becomes a new criteria that we're looking at. How do we manage them? How do they have a life cycle? So what was the life cycle of, say, an application is now the life cycle of components and so that's a That's a pretty complex thing. So it's not so much that you're getting app creep, but you're definitely rethinking how you want to design your applications and services and some of those you're gonna do yourself and a lot of them are going to say it's too complicated. I'm just going to go to some kind of SAS cloud offering for that and let it go. But I think that many of the larger companies I speak to are looking for a larger company to help them build some kind of framework to migrate from what they've used with them to what they need tohave going forward. >>Yeah, I think. Where the complexities. John, You asked who who creates the normalization layer? You know, obviously, if you look to the cloud providers A W s does a great job of stitching together all things AWS and Microsoft does a great job of stitching together all things Microsoft right in saying with Google. >>But >>then they don't. But if if I want to do some Microsoft to Amazon or Google Toe Microsoft, you know, connectivity, they don't help so much of that. And that's where the third party vendors that you know aviatrix on the network side will tear of the security side of companies like that. Even Cisco's been doing a lot of work with those companies, and so what we what we don't really have And we probably won't for a while if somebody is gonna stitch everything together at every >>you >>know, at every layer. So Andi and I do think we do get after it. Maribel, I think if you look at the world of consumer APS, we moved to a lot more kind of purpose built almost throwaway apps. They serve a purpose or to use them for a while. Then you stop using them. And in the enterprise space, we really haven't kind of converted to them modeling on the mobile side. But I think that's coming. Well, >>I think with micro APS, right, that that was kind of the issue with micro APS. It's like, Oh, I'm not gonna build a full scale out that's gonna take too long. I'm just gonna create this little workflow, and we're gonna have, like, 200 work flows on someone's phone. And I think we did that. And not everybody did it, though, to your point. So I do think that some people that are a little late to the game might end up in in that app creep. But, hey, listen, this is a fabulous opportunity that just, you know, throw a lot of stuff out and do it differently. What What? I think what I hear people struggling with ah lot is be to get it to work. It typically is something that is more vertically integrated. So are you buying all into a Microsoft all you're buying all into an Amazon and people are starting to get a little fear about doing the full scale buy into any specific platform yet. In absence of that, they can't get anything to work. >>Yeah, So I think again what? What I'm hearing from from practitioners, I'm gonna put a micro serve. And I think I think, uh, Mirabelle, this is what you're implying. I'm gonna put a micro services layer. Oh, my, my. If I can't get rid of them, If I can't get rid of my oracle, you know, workloads. I'm gonna connect them to my modernize them with a layer, and I'm gonna impart build that. I'm gonna, you know, partner to get that done. But that seems to be a a critical path forward. If I don't take that step, gonna be stuck in the path in the past and not be able to move forward. >>Yeah, absolutely. I mean, you do have to bridge to the past. You you aren't gonna throw everything out right away. That's just you can't. You can't drive the bus and take the wheels off that the same time. Maybe one wheel, but not all four of them at the same time. So I think that this this concept of what are the technologies and services that you use to make sure you can keep operational, but that you're not just putting on Lee new workloads into the cloud or new workloads as decomposed APS that you're really starting to think about. What do I want to keep in whatever I want to get rid of many of the companies you speak Thio. They have thousands of applications. So are they going to do this for thousands of applications? Are they gonna take this as an opportunity to streamline? Yeah, >>well, a lot of legacy never goes away, right? And I was how companies make this transition is gonna be interesting because there's no there's no really the fact away I was I was talking to this one company. This is New York Bank, and they've broken their I t division down into modern I t and legacy I t. And so modern. Everything is cloud first. And so imagine me, the CEO of Legacy i e 02 miracles. But what they're doing, if they're driving the old bus >>and >>then they're building a new bus and parallel and eventually, you know, slowly they take seats out of the old bus and they take, you know, the seat and and they eventually start stripping away things. That old bus, >>But >>that old bus is going to keep running for a long time. And so stitching the those different worlds together is where a lot of especially big organizations that really can't commit to everything in the cloud are gonna struggle. But it is a It is a whole new world. And like I said, I think it creates so much opportunity for people. You know, e >>whole bus thing reminds me that movie speed when they drive around 55 miles an hour, just put it out to the airport and just blew up E >>got But you know, we all we all say that things were going to go away. But to Zia's point, you know, nothing goes away. We're still in 2021 talking about mainframes just as an aside, right? So I think we're going to continue tohave some legacy in the network. But the But the issue is ah, lot will change around that, and they're gonna be some people. They're gonna make a lot of money selling little startups that Just do one specific piece of that. You know, we just automation of X. Oh, >>yeah, that's a great vertical thing. This is the This is the distributed network argument, right? If you have a note in the network and you could put a containerized environment around it with some micro services um, connective tissue glue layer, if you will software abstract away some integration points, it's a note on the network. So if in mainframe or whatever, it's just I mean makes the argument right, it's not core. You're not building a platform around the mainframe, but if it's punching out, I bank jobs from IBM kicks or something, you know, whatever, Right? So >>And if those were those workloads probably aren't gonna move anywhere, right, they're not. Is there a point in putting those in the cloud? You could say Just leave them where they are. Put a connection to the past Bridge. >>Remember that bank when you talk about bank guy we interviewed in the off the record after the Cube interviews like, Yeah, I'm still running the mainframe, so I never get rid of. I love it. Run our kicks job. I would never think about moving that thing. >>There was a large, large non US bank who said I buy. I buy the next IBM mainframe sight unseen. Andi, he's got no choice. They just write the check. >>But milliseconds is like millions of dollars of millisecond for him on his back, >>so those aren't going anywhere. But then, but then, but they're not growing right. It's just static. >>No, no, that markets not growing its's, in fact. But you could make a lot of money and monetizing the legacy, right? So there are vendors that will do that. But I do think if you look at the well, we've already seen a pretty big transition here. If you look at the growth in a company like twilio, right, that it obviates the need for a company to rack and stack your own phone system to be able to do, um, you know, calling from mobile lapse or even messaging. Now you just do a P. I calls. Um, you know, it allows in a lot of ways that this new world we live in democratizes development, and so any you know, two people in the garage can start up a company and have a service up and running another time at all, and that creates competitiveness. You know much more competitiveness than we've ever had before, which is good for the entire industry. And, you know, because that keeps the bigger companies on their toes and they're always looking over their shoulder. You know what, the banks you're looking at? The venues and companies like that Brian figure out a way to monetize. So I think what we're, you know well, that old stuff never going away. The new stuff is where the competitive screen competitiveness screen. >>It's interesting. Um IDs Avery. Earlier today, I was talking about no code in loco development, how it's different from the old four g l days where we didn't actually expand the base of developers. Now we are to your point is really is democratizing and, >>well, everybody's a developer. It could be a developer, right? A lot of these tools were written in a way that line of business people create their own APs to point and click interface is, and so the barrier. It reminds me of when, when I started my career, I was a I. I used to code and HTML build websites and then went to five years. People using drag and drop interface is right, so that that kind of job went away because it became so easy to dio. >>Yeah, >>sorry. A >>data e was going to say, I think we're getting to the part. We're just starting to talk about data, right? So, you know, when you think of twilio, that's like a service. It's connecting you to specific data. When you think of Snowflake, you know, there's been all these kinds of companies that have crept up into the landscape to feel like a very specific void. And so now the Now the question is, if it's really all about the data, they're going to be new companies that get built that are just focusing on different aspects of how that data secured, how that data is transferred, how that data. You know what happens to that data, because and and does that shift the balance of power about it being out of like, Oh, I've created these data centers with large recommend stack ums that are virtualized thio. A whole other set of you know this is a big software play. It's all about software. >>Well, we just heard from Jim Octagon e You guys talking earlier about just distributed system. She basically laid down that look. Our data architectures air flawed there monolithic. And data by its very nature is distributed so that she's putting forth the whole new paradigm around distributed decentralized data models, >>which Howie shoe is just talking about. Who's gonna build the visual studio for data, right? So programmatic. Kind of thinking around data >>I didn't >>gathering. We didn't touch on because >>I do think there's >>an opportunity for that for, you know, data governance and data ownership and data transport. But it's also the analytics of it. Most companies don't have the in house, um, you know, data scientists to build on a I algorithms. Right. So you're gonna start seeing, you know, cos pop up to do very specific types of data. I don't know if you saw this morning, um, you know, uniforms bought this company that does, you know, video emotion detection so they could tell on the video whether somebody's paying attention, Not right. And so that's something that it would be eso hard for a company to build that in house. But I think what you're going to see is a rise in these, you know, these types of companies that help with specific types of analytics. And then you drop you pull those in his resource is into your application. And so it's not only the storage and the governance of the data, but also the analytics and the analytics. Frankly, there were a lot of the, uh, differentiation for companies is gonna come from. I know Maribel has written a lot on a I, as have I, and I think that's one of the more exciting areas to look at this year. >>I actually want to rip off your point because I think it's really important because where we left off in 2020 was yes, there was hybrid cloud, but we just started to see the era of the vertical eyes cloud the cloud for something you know, the cloud for finance, the cloud for health care, the telco and edge cloud, right? So when you start doing that, it becomes much more about what is the specialized stream that we're looking at. So what's a specialized analytic stream? What's a specialized security stack stream? Right? So until now, like everything was just trying to get to what I would call horizontal parody where you took the things you had before you replicated them in a new world with, like, some different software, but it was still kind of the same. And now we're saying, OK, let's try Thio. Let's try to move out of everything, just being a generic sort of cloud set of services and being more total cloud services. >>That is the evolution of everything technology, the first movement. Everything doing technology is we try and make the old thing the new thing look like the old thing, right? First PCs was a mainframe emulator. We took our virtual servers and we made them look like physical service, then eventually figure out, Oh, there's a whole bunch of other stuff that I could do then I couldn't do before. And that's the part we're trying to hop into now. Right? Is like, Oh, now that I've gone cloud native, what can I do that I couldn't do before? Right? So we're just we're sort of hitting that inflection point. That's when you're really going to see the growth takeoff. But for whatever reason, and i t. All we ever do is we're trying to replicate the old until we figure out the old didn't really work, and we should do something new. >>Well, let me throw something old and controversial. Controversial old but old old trope out there. Consumerism ation of I t. I mean, if you think about what year was first year you heard that term, was it 15 years ago? 20 years ago. When did that first >>podcast? Yeah, so that was a long time ago >>way. So if you think about it like, it kind of is happening. And what does it mean, right? Come. What does What does that actually mean in today's world Doesn't exist. >>Well, you heard you heard. Like Fred Luddy, whose founder of service now saying that was his dream to bring consumer like experiences to the enterprise will. Well, it didn't really happen. I mean, service not pretty. Pretty complicated compared toa what? We know what we do here, but so it's It's evolving. >>Yeah, I think there's also the enterprise ation of consumer technology that John the companies, you know, you look a zoom. They came to market with a highly consumer facing product, realized it didn't have the security tools, you know, to really be corporate great. And then they had to go invest a bunch of money in that. So, you know, I think that waken swing the pendulum all the way over to the consumer side, but that that kind of failed us, right? So now we're trying to bring it back to center a little bit where we blend the two together. >>Cloud kind of brings that I never looked at that way. That's interesting and surprising of consumer. Yeah, that's >>alright, guys. Hey, we gotta wrap Zs, Maribel. Always a pleasure having you guys on great great insights from the half hour flies by. Thanks so much. We appreciate it. >>Thank >>you guys. >>Alright, keep it right there. Mortgage rate content coming from the Cuban Cloud Day Volonte with John Ferrier and a whole lineup still to come Keep right there.

>>the >>globe. It's the Cube with digital coverage of AWS >>reinvent 2020 >>sponsored by Intel, AWS and our community partners. Everyone welcome back to the cubes. Virtual coverage of AWS reinvent 2020 Virtual I'm John for your host. Got a great segment here with two analyst day Volonte and Zia's Carvell who's head principles of zk research dot com. Guys. Great to see you A W s Kino. Thanks for >>coming on. Let's be back in the cube. >>Welcome back. Great to see you guys. Wanna get your thoughts? Um, it's mainly you because we talked with the enterprise a lot. You are leading analyst. You cover a broad range from networking all the way up to the C suite for enterprise buyers and and technology trends. Um, Andy Jassy laid down, in my opinion, what was directionally his next 20 mile stare. The next conquest for Amazon. And that is global. I t spend they locked in the infrastructures of service pass kicking ass. There. Check check. Hello, Enterprise. Different ballgame. What's your thoughts? >>Yeah, they have so much in different areas, obviously. You know, they have dominated cloud instances right there. Mawr compute storage memory. You know insists that anybody but you can see him, um, spreading their wings now, right? I think one of the more interesting announcements was actually what they're doing with Amazon connect. That's their contact center platform. And this is something that I think, Even last year, a lot of people weren't really even sure if they'd be in a long primary in the pocket. People about this market, they were asking, If you really think Amazon's in this, there's something they're experimenting. But we're here to stay. And I think one of the interesting things that they bring to market is, you know, almost unprecedented scale with their cloud platform as well as all the machine learning algorithms. And I think if if you believe that machine learning artificial intelligence is changing, I t. Forever and that's everything from the infrastructure to the network through the applications, then they have an inherent advantage because they have all those machine learning albums built into this stuff that they dio and so they can constantly look at these different markets and disruptive, disruptive, disrupt and take more and more sharing that and that's what they've done. E think that's you know, the context and announcements were great example that they're not doing the telephony things, and, you know, they're kind of bare table stakes. They do that pretty well, but they've just unloaded a whole bunch of ai based features that >>Dave, what's your take on this context center? Because it's not just call centers. I mean, there was a whole industry around call center, unified communications. That whole world. This is about the contact. It's about the person. This is not just a nuanced thing like telephony or, you know, PBX is in the old days. Remember those days? Things is not about the call. It's about the contact. This is what Jazzy saying. >>I think that way had Diana or on early. And I said, I like the fact that their AWS specifically is going after these solutions because several years ago it was just sort of. Here's a bunch of tools. Go figure it out. I think the contact center is I mean, everybody can relate Thio the pains of going through getting rerouted, having to restate all your credentials, not knowing who you are. And so between machine learning, Alexa, Natural language processing, better work flows. I mean there's this huge opportunity toe reinvent the whole call center contact center. So, uh, yeah, I think you called it John. It's a no brainer for a W s toe Really disrupt that >>business. Well, it also puts him in a position. You know, news is breaking on the day of and yet his keynote here at reinvent that, uh, you got Salesforce spying slack for 27 close toe, $28 billion. That's a 55% premium over when they announced it. And that's like a 30 x or 50 x on on revenue. Massive number to confess the message board software. I mean, so So. So. If Amazon can come in and get the context center model, which is not just voice, it's chat, it's machine learning. It's bots. And the innovation to create a step function kind of brings it back into the that integration of user network compute. You know, I just think that it feels very edgy in the sense of edge computing, because if I'm a person, I'm mobile. If I'm a person at work or at home, so there's a whole redefinition Zs, what's your take on this edge? Play from Amazon in context toe the enterprise software landscape. That seems to be, you know, focus on buying companies like Salesforce. >>Well, I think edges really the next big foray for computing. If one of the things and you ask we talked about this, you know, was that the compute, the unit of Compute, has gotten smaller and smaller, Right? We went from data centers to servers to virtual machines, the virtual machines and clouds. Now we're talking about containers and containers on edges, and this requires, um if you if you believe in the world of distributed computing where we're gonna have mawr containers running in MAWR, places on MAWR edges, right. The value proposition where companies is now they can move their data closer to the customer. They could move data closer to the user. And so, if I'm a retailer and I'm trying to understand what a customer is doing, I could do that in store. If I'm Tesla and I'm trying to understand what the drivers doing, I could do that in car, right? If I'm a cellular provider, I could do it by cellular edge. So the edge, I think, is where a lot of the innovation is going to be at Amazon has the luxury of this massive global network. You know, they just announced the number another a number of other local nodes, including Boston and a few other places. So they've got the footprint in place. And this this is what makes Amazon's are difficult to compete with, right? They built this massive network and this all these, no doubt for their e commerce business. And now they're leveraging that deliver I t services. You can't just go build this from the ground up the variety, right? You have to be able to monetize it another way. And they've been doing that with the commerce for a long time. And so it makes them. It makes it very, very difficult for them to capture Google could with Daniel forget about the item. Oh, yeah, so good. Microsoft. Possibly. But they I think that the more distributed compute becomes the more favors Amazon, >>I would add to that if I could, John, I mean, look good. Look at the prevailing way in which many of the infrastructure the old guard is Andy. Jesse calls them. Companies have pursued the edge they've essentially taking, taking x 86 boxes and, you know, maybe made him rugged and throwing them over the fence to the edge. And that really is not gonna play the edges. Now there's not one edge. I mean, there's a very highly specific use cases and factories and windmills. And maybe maybe it's small retail organizations, and whatever it is that those are gonna be really unique situations. And I think the idea of putting a programmable infrastructure at the edge is gonna win. I also think that the edge architecture is gonna be different. It's going to require much more efficient processing to do a I Influencing a lot of the data is gonna be, uh, stay at the edge. A lot of it's not gonna be persisted. Some of it's gonna come back to the cloud. But I think most of it is actually gonna gonna either not be persisted or stay at the edge and be affected in real time. When you think of autonomous vehicles so totally different programming model, >>well, I think that's the point of what I was saying earlier Zeus was talking about Is that it's It's the edges is just different. I mean, you got purpose built stuff. I mean, they were talking by the way they have snowball. So they have, ah, hard edge device. And they got out outpost now in multiple flavors and sizes. But they also were talking about computer vision and machine learning. We're going together for that. The panoramic appliance. I think it was where there's all these different cases to your point, Dave, where it's just different. At the edge, you have the zones for five G. I mean, if you go to a five g tower, that's essentially an edge. Just there's equipment up to this. Radios is transceivers and other back haul equipment. So when you look at the totality of what it is, the diversity, I think that's why this whole idea of Lambda and Containers is interesting. Toe Zia's. When you were saying about the compute sizes being small, because if you could put compute at the edge on small pieces to match the form factor that becomes interesting. I think that's what this Lambda container announcement I found interesting because I see that playing directly into that your reaction to >>that. It actually, um, makes it. If not done correctly, it could make I t much more complex because, um, containers air interesting because they're not like virtual machines. First live in perpetuity. Containers you They're very ephemeral, right? You spin them up to 30 seconds, you spin them up for a couple of minutes that you deprecate them. So at any given point in time, you could have thousands of containers, a handful of containers, millions of containers, Right? But it necessitates a common management. Uh huh. Underlay that could be used to visualize where these containers are, what's running on them. And that's what AWS provides. You know, all the stuff they're doing Lambda and Eks and things like that that lends itself to that. So a customer can then go and almost create a container architecture that spans all their cloud's edges, even on Prem. Now, uh, when Amazon has but still be able to manage it and simplify it, I think somebody's trying to do it themselves. They're gonna find that the complexity almost becomes untenable. Unless you have a Nike organization the size of Amazon companies don't. So we're >>gonna here, we're gonna hear from Deepak singing in a few sessions. He did the eks anywhere. That's essentially kubernetes service on the data center. But look at what they did with eks anywhere and then CCS, which has a common control plane to your point, that's compelling. And so, you know, if you're a developer or you're an enterprise, you might not have If you want to go with this. I t world. We talked about earlier zeros before you came on on our last segment. Most I t is not that built out in terms of capabilities. So learning new stuff is hard, so operating Amazon might be foreign to most I t shops. This is a challenge. Did you agree with that? Or or how do you see that? >>Um, well, a lot of Amazon used, obviously just the interviews and numbers of fucked that right. Um, but I think the concept of in a world where you have that common operating layer that spans it's no longer geographically limited to a data center or to a server. You know, it's it's now distributed across your entire multi cloud or distributed cloud environment. And so one of the important things right people remember is the world is becoming more dynamic and or distributed, and your I t strategy has to follow that. If you're doing things that are counted that you're not only standing still, you're actually going backwards. And so what Amazon is doing is they're allowing companies to be is dynamic distributors. They need to be to be able to maintain that that common operating layer that actually makes it management, because without it, you just you wind up in a situation. Like I said, that's incredible. A lot of people facing that today. And that's why that's why there's this big divergence, right? This five native cos they're going fast and legacy companies that can. >>Guys, I want to spend the next 10 minutes we have getting into more of the business side from this keynote because because I know your research on digital transmission first. I know you know the networking side up and down the stack and all that good stuff, but you've been doing a lot of research around the digital transformation with the cloud. Dave, you just put out a great great breaking and else think your 55th, um, episode on digital transformation with the cloud. It's very clear that Jackie is basically preaching, saying, Hey, Clay Christensen is former professor who passed away. He brought up this whole innovator's dilemma kind of theme and saying, Hey, if you don't get the reality that you're in, you better wake up and smell the coffee. It's a wake up call. That's what he's basically saying That's my take away. This is really this business management lesson. Leadership thinking is super important, and I know we've We've talked about people process, technology. Uh, let's Covad eyes this real quick. Bottom line. What is the playbook? Do you agree with jazz? His point of view here? Um, he's pretty being hardcore. He's like, literally saying adapter die in his own way. What, you guys thoughts on this? This is a true forcing function. This cove, In reality, >>I mean I mean, if you talk about the business transformation, digital transformation, business transformation, you know, what does that mean? I, like, said earlier that the last 10 years about I t transformation, I think the next 10 is gonna be about business transformation, organizational industry transformation, and I think what that means is the entire operational stack is gonna get digitized. So your sales you're marketing your your customer support your logistics. You know you're gonna have one interface to the customer as opposed toe, you know, fragmented stovepipe siloed. You know, data sets all over the place, and that is a major change. And I think that's ultimately what a W. S is trying to affect with its model and has obviously big challenges in doing so. But But that, to me, is what digital transformation is ultimately all about. And I think you're going to see it unfold very rapidly over the next several >>years. What's your reaction? What's your view on on the on Jackie? >>And he talked about his eight steps toe reinvention. Um and e think what digital transformation to me is the willingness to re invent disruptive own business even in the face that it might look horrible for your business, right? But understanding he is there something that I think is true. And a lot of, um, business leaders don't fully by this that if something is good for your customer, they're going to do it, and you can either make it happen, or you gonna watch it happen and then have the market taken away from me because there's a lot of cases you look at how slow you know, A lot of the banks, you know, operated until you know, the a lot of these, uh, cloud native, uh, money exchange systems came around the cape. Alan Ben more and things like that, right? Even retailers Amazon completely disrupted that model. You could say that Amazon killed, you know, Toys R us, but 20 rescue Toys R Us E. And I think there's got to be this hard willingness to look at your business model and be willing to disrupt yourself. And what Kobe did, John, I think, is a taught us a lesson that you have to be prepared for anything because nobody saw this coming. And sure you can. And a lot of companies thrived out of this, and a lot of one's gone away, but that the ability to be agile has never been more important. But you're only is Angela's. Ike lets you be, and that's what that's what. The W. Is going to sell us the ability to do anything you want with your business. But the staff, you have to have the business because they're willing to do that. >>You know, that's a great point. That's so smart. It's crime that's worth calling out. And we were talking before we came on live about our business with the Cube. There's no virtual, there's no floor anymore. So we had to go virtual if we weren't in the cloud. If we weren't doing R and D and tinkering with some software and having our studio, we'd be out of business. Dave. Everyone knows it. Now Get the Cube virtual. We have some software were position, and this kind of speaks directly to what Andy Jassy said. He said. Quote. If you're not in the process of figuring out as a company, how you're going to reinvent your customer experience in your product and reinvent who you are, you are starting to unwind. You may not realize it, but you are. What he's saying is you better wake up and smell the coffee and I want to get your guys reacted. You, particularly you around your experience and research. I've noticed that some customers that had cloud going on did well with co vid and said ones that didn't are still struggling not to catch up. So you're kind of intense. You got some companies that were that were on the wave, Maybe kind of figuring it out, that we're in good position and some that were flat footed and are desperate. Um, seems to be a trend. Do you agree with that? And what's your view on this idea of being ready? What does that even mean to be? Have readiness or >>take, you don't get the data points that Andy threw up there, right? That 50% of the companies that were the global fortune $500.2000 or are no longer here, Right? That Zatz Pretty shocking statistic. And that does come, uh, you know, from the willingness to disrupt your business. And if you got you're right. The companies that had a good, solid class raging in place, we're able to adapt their business very quickly. You could you look at retailers. Some had a very strong online presence. They had online customer service set up those companies didn't find other ones, were really forced to try and figure out how to let people in the store had a mimic. You know, the in store experience, you know, through from, uh, you know, support interface or whatever. Those are the ones that really struggling. So you're right. I think companies that were on the offensive plug to Dover companies that were fully in the cloud really accelerated their business and ones that didn't buy into it. I think they're struggling to survive in a lot of They're gone. >>Yeah, and all that. John, When Jesus was talking about his view of digital transformation, I was just writing down some of the examples to your point. The folks that were sort of had were cloud ready, covert ready, if you will. And those that weren't But think about think about automobiles. You know, there's testily even a manufacturer of automobiles or they software company. Personal health has completely changed over the last nine months with remote. You know, uh, telehealth automated manufacturing. You think about digital cash, e commerce and retail is completely, you know, accelerated. Obviously toe online. Think about kids in college and kids in high school and remote learning farming. You know, we've done a great job in terms of mono crops and actually creating a lot of food. But now I think the next 10 years is gonna be how do we get more nutritious food to people and so virtually every industry is ripe for disruption, and the cloud is the underpinning of that disruption. >>Alright, guys, got a few more minutes left. I want to get your thoughts quickly on the keynote. What it means for the customers that we're watching again. This is not a sales and marketing conference as they talk about. But if you're sitting in the audience, you guys, we're watching and we're virtual um Did it hit home with you? If you're a customer, what did he what? Give us Give the grades. Where do you Where do you hit a home run? Where he missed. Did he leave anything out? What's your take Zia's? We'll start with you. >>Um, I thought it was actually really good Keynote. I thought you did a good job of making the case for AWS. They talked about the open. They have more instances than anybody. So you could do almost any kind of compute in their cloud. I think one of the important lessons variety to is the importance. You can't just do everything. The software right? Hardware Still important silicon still important that, and to meet the needs of very special he needs from things like machine learning and AI. Amazon's actually spending their own silicon very much like Athens doing with their computers. And so if you are going to be a customer service focused company, you need to think of the I T. Stack and everything from the silicon, the hardware through the software, and build that integrated experience to Amazon's giving a tools to do that Now E. Do I would like to see Amazon be a little more, um, a supposed the cloud competitive friendly. The one thing I hear from customers all the time is they love the Amazon tools. They love the optimization capabilities, but you know, if they are adopting some kind of multi cloud strategy, the Amazon tools don't work in Azure and the capital don't work in Amazon. The same with Google, and it would be well within the best interests of those three companies. They find a way to get together and allow their common framework to work across clouds. Amazon's already got a lead that they could do that, and I don't think it's gonna be, but that that is something I think that's still missing from this world is they make it very difficult for customers to move the multi cloud. >>Well, some would say some people are saying, saying that the number one in the cloud I mean, got cloud wars Bob Evans over there saying Microsoft is dominating number one position over everybody else, multiple quarters in a row Now he's looking at revenue and granted. You got a lot of propping up there you got. You know, Windows server and sequel. You got a bunch of professional services, But clearly the I as in past side of the market, Microsoft is, like, way behind um So, yeah, they've got the numbers little legacy in their Microsoft should, and they got a little base. If I'm Amazon, I'm not. I'm worried about Microsoft more than anybody. I think you know, I looking at the Civil War between the Seattle forces. I mean, this is really Microsoft's gotta greatest all base, and they could flip that license deals and >>the cloud is good enough. I mean, it's myself doing very, very well with its classic Microsoft. You know >>they your point. Microsoft is the king of good enough, right? They put out features. They market heavily to the I t pro on. They put out licensing packages, so you're almost foolish to not at least fry their products. And then they do roll it out. So it's good enough and then you live with it for a while. But ultimately, whenever people use Microsoft, they do have an alternative under in there for a very special case. But e don't wanna >>the king of good enough. That's a great line. I love that. I'm gonna use that. But this Babel fish thing for Aurora that is a huge dagger. Potentially, it's an escape valve for customers. They wanna leave Microsoft. But clearly, if Microsoft you're gonna get penalized by running your license on Amazon. >>If our CEO our i t c t, I'd say, Okay, I definitely want to do business with with Amazon. That's what I heard today from Jassy, and I would want to hedge my bets either with Microsoft, especially if I'm a Microsoft shop or with Google's from analytics heavy unquestionably. I'd want to hedge my bets and have some kind of 70 30 80 20 mix. >>Look, if you're Andy Jassy and he's told me my interview, do it directly. I asked this question. He was very forthright. He doesn't hide from the fact that, uh, customers have multiple clouds, but they have a primary and secondary, but they're not gonna have, like, five or six major clouds. Yeah, it's hard to get these teams trained at to begin with. So there's a hedge. There's a supplier leverage. I get that. He's totally gets that. But if you're Amazon, you're gonna have your annual conference. You really don't wanna be in the business of talking about the other guys cloud, you say hybrid, right? It's on my show. You know, like you're competing. This is there's definitely competition between Microsoft and A W s. So you gotta respect that. But yeah, of course. There's multiple clouds called hybrid eks everywhere. Uh, container service. I mean, >>especially global, right? Different cloud providers of different strengths in different regions. You know, Microsoft, very strong in the Gulf. AWS isn't you know. So if you're a global company, um, you know, then you almost by default, have to go multi cloud multiple cloud vendors because of geographic differences. Obviously, China, with its own set of cloud providers. So, you know, smaller midsize businesses could get away with one, but As soon as you become global, you have to use more. >>Well, I'm a big fan of distributed computing. I loved the large scale concept of distribute computing. You got regions. Now you've got local zones. You got I O t edge. You got cloud going on Prem Edge. It's really an edge game at this point. Greater now distributed hyper Put hyper next to anything hyper cloud on your sounds better Piper >>Cube. And the opportunities the cloud providers and Amazon, you know, certainly is leading. This is the ability to take this complex, hyper distributed world and use their management tools toe create a normalized operating simplify What would be an overly complex world about it? >>Okay, we got a break. Just quick plug. There's a big salesforce event coming up on December 10th. Check it out on the Amazon site that that plug in you watching the cube stay tuned for more coverage after this break

>> Live from Orlando, Florida It's the Cube covering Enterprise Connect twenty nineteen brought to you by five nine. >> Hello from Orlando. We are at Enterprise Connect twenty nineteen, and we're being very graciously hosted by five nine, which is the intelligent Cloud Contact center. We had a great few days, two minute minute myself talking with customers, partners, vendors on this massive change and enterprise, communication and collaboration. We're excited to welcome back to the key one of our alumni, Zs Caravella, the founder and principal analyst at Zeke Research. These It's great to have you here, >> Dawson. To me. Here >> you are. You should have the i p status at Enterprise Connect because you have been to this event some twenty times. >> I believe it's my twentieth. >> Can't imagine. So they didn't They should have rolled out the red carpet. Maybe we'll put a note >> in next year, >> but Yeah. There you go. I >> want to get my own booth. >> There you go. But I can't imagine how much this event has changed. And just your perspectives on Day three here of e. C nineteen and some of the vendors that you're like, Wow. A few years ago, you would never have seen a so and so here. >> Yeah, the shows massive compared to what it used to be the Remember when I first started coming to the show floor was maybe if I was a quarter the size, I mean generous, and it was really dominated by just a handful of companies. But since then, it's gone through several transitions the i p to software to the cloud on. That's gotten a lot more companies interested. And I think also, finally, businesses starting understand that if you're going to transform digitally right, communications has to be part of that fact. If you look at any piece of research right that I know there's a walker study throwing around saying by twenty twenty customer experience to be the number one brand differentiator, that's that's already happening. It's already the number one brand differentiator. And so because of that, more and more companies are now interested in communications. So, you know, ten years ago, fifteen years ago, we didn't have Amazon here. We didn't have Microsoft here. We didn't have Oracle here, but it's been a great thing for the show to see all these other companies that really have really great presidents validate what we've been saying for a long time, and it's a much different show today than it was. >> Yeah, it's really interesting that the thing that opened my eye is some of the companies that air here. I wish I knew which brand used these technologies so that if and when I do have an issue, I'm not gonna have that horrible customer experience that you know we've had in the past. It's like, you know, if I wanted to make a call, it's like, Can I even make a call? And, you know, do I actually get through the I V R. Things like that? I like how you set it up there. Some of these pendulums swings some of these waves of technology. Um, let's talk a little bit about voice because this used to be called Voice Khan, and it went through a rebranding because, you know, voice was in a little bit of kind. But, you know, we know voices. It's still very important. How does that fit in the hall >> when I went through that rebound, Frankly, voice wasn't sexy anymore. Everyone is talking about unified communications. No one was going to call anybody ever again. We're just gonna message or social each other to death and what's happened is voice is kind of important, right? And I think one of the undersea and friends to look at is that voice is becoming simultaneously less important and more important. What I mean by that is that they sound like a little bit of an oxymoron. But if you look across all age demographics right there, everybody has a prefered mode of communications, and it's rarely voice to start a conversation with the company. You message them your social, um, send them an e mail. But somewhere in there, you you eventually want to talk to somebody, and a that moment s o to start the conversation voices less important. But at that moment, you now want to have a conversation with uneducated agent who knows what your problem is and can help you quickly. And so now voices Mohr important than it's ever been before where, but I think the buried entry wasn't all that high, but voices, you know, it's it's important, it's sexy, and especially when people are dealing with emotional issues, they're dealing with money problems right in front of get a refund. If I'm trying to check on the status of my health, I want to talk to somebody. But when I want to talk to somebody, I want to get that conversation with over. It's possible. I think the bar's been raised as you mentioned to. You used to think that the dreaded Ivy are. If you have a dread and ivy are experience, you just want to business that company anymore, right? And so the stakes are higher than the bar's been raised on. What voices >> are you saying that the customers that you were talking to are now starting to get much more prescriptive in terms of understanding their customer journeys and their preferences? You know, before they used to go, we assume we're talking to millennials. They only want they only want ASA Master. Our company's starting to get more focused on. Alright, let's actually do analysis and determine if a voice only one of the next channels that we need to enable, >> uh, well, I wish they were. I think we're really in the early early innings that I think the best companies in the world are doing that. If you look at companies with very high, uh, NPS scores and customer SAT scores there doing that thing already and I think it's a good lesson for the rest of the industry. If you're not doing that, you're gonna fall behind pretty quickly. And I think that is driving companies more to the Saami Channel experience Where, uh, from, uh, from an analytic standpoint, you really have to understand your customer, not at the demographic level, but almost at a custom level because everyone's different, right? I think that's, uh, that's never been possible before. But today, because we've got bigger data sets. Things were in the cloud rise of artificial intelligence. It's made all the stuff possible. So companies like I said, the best cos the world to taken advantage of and they're having a, you know, big differences. That's why there's been such a huge swings in the market leadership right there cos we never heard of before. Market leaders and brands we trusted loved before they're gone. >> Yeah, I'm glad you brought that up, because every company we talked to this week that that CX is at the center of what they're talking about. So, in your research, what is differentiating though those new leaders and, you know, causing some of those swings in the market place hot out of the customer. Look at these and help differentiate and and ever changing marketplace. >> Well, it's what's going on today. It's really about being more contextual, having a deeper understanding a wire. Customers calling, uh, how you could help him faster understanding maybe what products they own. You know what? What are some of the adjacent ones? Ah, no. I think that's going very quickly, become table stakes. And I think where we're moving to is we're going to shift customer service from being largely inbound, driven and reactive. And that's where they I can help react faster to being Mohr, outbound driven and pearl active. Right? So, for instance, let's say I buy a connected refrigerator and my water filter needs changing. Well, right now, I still have to recognize that. And maybe I call that refrigerator company and they can proactively help me because they understand what I have. And they've got a great arm, the Channel contact center. But ultimately that should be a reverse. They should contact me, maybe through a text message saying, Hey, you're we noticed your water filter needs changing. Can we send you one? Yes, it comes and then maybe I call the agent and say, Can you help me install it? Right? So I think within the next three, four years, we're going to see a lot of customer service, Uh, where contextual is the table stakes and then the ability to predict what your customer wants. That's going to be the differentiator. And frankly, that's really exciting. I mean, if you think we've seen change of this industry as you mentioned in the last five years, wait for the next five. >> When you're talking with customers or even doing research and and other venues, it's to mention CX. We talk. We've been talking about it all week, but I get curious when I hear the customer experience and the agent experience just think, How are they not how they separate because of the Asian isn't empowered to be able to, whether it's no the right channel. But I want to be communicated with or have the information where the context about why I'm calling, then the customer experience, right? >> Yeah, well, they're very tightly linked together. You can't have a good customer experience that a good agent experience and you may have the best trained agents in the world that are the most empathetic that are incredibly sensitive with what people want. But if they don't have the data, you're going frustrate your customer. And everybody's been through that situation where you get transferred to somebody else and you gotta start that whole conversation over again and eventually you just hang up and say, I don't want ever to business. So I think you're right. Agent experience Customer experience are very tightly interwoven, and they're they're really dependent on one another. You can't you can't do without the data. And again, that's where all these friends of a I come into play because they're able to send better information to the agents faster, really, through an assistive technology versus replacement. Right? >> So when we came into this show, we knew that the wave of cloud had made a big transformation. We're starting to hear a I is the next wave everybody's talking about. I believe I read something that that you had written that was talking about, you know, whether that is something just internal the company build in versus how it interacts with the customer. Where do you see I having the biggest impact kind of in the short term, and nowhere is that more long. >> It's a great question because I ask my customers all the time. Should we be using intelligence bots? Or if you saw the Google Duplex Nemo, where they have on a I call in order pizza I think it was or something like that. So is a I ready to talk to people? And I think if you think of the entire world of interactions on a two by two grid is an analyst would like to buy two grids, right? And you put complexity of conversation on one axis and frequency of interactions if it's hiking, or if it's low complexity, high frequency, that might be okay to try and automate through a But other than that, everything should flipped. Agent. And I think right now we're very early in the cycle, and so is a business. I'm not sure I trust today. I tow always have the right answer, but it makes a great assistant technology to recommend to the agent. This is what you should say, and the great thing about that is, if the agent says no, that's stupid and says that wasn't helpful. That becomes the input to the learning mechanism for the A I so overtime will get smarter and smarter. But if you if you want to think about just the role of it now, I always use the analogy is like a self driving car. I'm not sure if either one of you would want to jump in a car that has no driver, no steering wheel, no controls. But there's a lot of great aye aye technology in a car like lane change assist, parallel parking assist things like that that can make you a better driver. So let's make our agents better drivers by giving him those assistive technologies. And that's the the short term vision long term. Who knows? But I But I think oh, if company's heir to aggressively they II, they're actually gonna create a nod. The opposite effect, where they hurt customer experience. It's the people that make a difference, so let's make those people better. >> That's one of the things that we've heard consistently throughout this event is the empathy factor machines can't bring. That's really got to be the humans with the A I to deliver on idea, hopefully optimal experience, too. Whatever customer has whatever issue on the back end. >> Yeah, in fact, Roman always talks about that as well. The CEO of five nine and I think he's right from that. Regarded is about having the knowledge of the customer in the empathy to understand. Put yourself in the customer's position and this to your point. Lisa, about CX. In Asian experience, we tied a couple together. If the Asian distressed because they don't have the right information and they're trying a message, this person, or look something up in the database, that frustration is going to come through to the customer. And that further frustrates the customer, right? So of the agents, armed with the right information, they can spend more time focused on the customer and less time trying to find the data that, frankly, they should have at their fingertips all the time. >> So speaking of five nine, you recently attended their analyst event. >> I did >> on. We've had the executives on the team. You know, Jonathan on earlier this week, you know, rock star background. We're goingto throwing on a little bit later. We know him from his Cisco days without breaking any India's, you know, give us a little bit of the insight as to, you know, five nine. You know, what have they been doing? Well, what's what's the new team driving them forward towards? >> Well, I mean, if you look at their stock price from Roland joined, it's it's more than doubled. So obviously there's, um, some good growth there. I think. What? I've always believed that it's very difficult to compete on product alone, right? And if you believe this whole world of it is this customer experience, that's what they do really well, the customers, their customers have a great experience here with five nine, they have a great service organization that makes sure that when you buy five nine, you have a good on boarding experience that set up the way you want it, and that services business makes a big difference. Now they've always had that. Now, where I think the new executive team has made a difference is helping the company understand the scale, move upmarket, more enterprises because the needs their different than down market. And so I think you know, they're gonna have a big impact on the future of five nine. Frankly, I think a lot of what you've seen for growth in the last year has been stuff that was put in place. But I know they're working on a lot of the AI capabilities. We're not breaking in the NBA's. I can tell you that the demonstrations that Jonathan Rosenberg, who's in there incredibly smart guy, I mean he might be the smartest guy in this industry was giving around. How a I can impact customer experience was the best set of concrete examples that I've seen today because it's really easy to give me a pie in the sky hypothetical things. But he really boiled it down in a very grand your level of this possible. This is possible and I'm expecting over the next year, five nine customers will see those things. >> They've done really well in the enterprise market. I think last year in twenty eighteen, they closed very, very strongly. Also, a lot of growth in there. Custom enterprise customers with a Million and Ahrar plus What are you seeing, though, in terms of some of the smaller businesses that probably are facing a lot of the same challenges that enterprises are? Is this an area where they can also leverage five nine two really dial up and deliver Great CX, >> Yeah, but the line has moved up right of people interested in cloud services that used to be too small businesses, and now it's all kinds. But I think for a small business, you can look like a much larger business. I think there's a lot of companies people sometimes think that's a little risky deal the small company. But five nine is a very, very valuable tool because by having that information right away that agents fingertips, they're able to actually replicates, uh, large company experience and on almost validate that the customer made the right decision using them. So I think up and down the stack it for five nine. They provide value tow companies of all sizes. Today, one of them, you know, the interesting aspects of what I've seen two is everybody talks about this twenty four billion dollars tam for Contact Center. I know I've been in that eye, and may I say that because that twenty four billion dollars tam is based on giving contact, Senator people contact center tools, but what I've been noticing over the last years, when people buy five nine, often it's not contact center people using that using it. It's sales people in marketing people, field service. Anybody that needs customer info is using it. And I'll give an example. One of the customers that was at the five nine day I can't see you. They say who they are. They migrated all fifty contacts and regions five nine. And since then they've added one hundred mohr sales people using the tools. So now we've got one hundred fifty people using five nine when there was only fifty contacts. Generations you can see the value is starting to spread across the company, and I think that's a pretty exciting thing. >> It's been interesting we've seen at the show. And in some of the interviews, that line between kind of unified communications and contact center seems to be blurring. It seems to be that >> well, everybody needs that data on the customer info. I actually cameras closer to forty. Forty five billion. To be frank, really, every anybody who uses a serum tool should have five nine capabilities. >> Zia's Thank you so much for sharing your insights and your energy on Day three. If Enterprise connect nineteen, we appreciate your time Thank you. First two minute, man. I'm Lisa Martin. You're watching the Cube?