>> Narrator: theCUBE's live coverage is made possible by funding from Dell Technologies. Creating technologies that drive human progress. (bright upbeat music) >> Good morning everyone. Welcome to theCUBE. We are live at MWC '23 in Barcelona, Spain. I'm Lisa Martin, and I'm going to have a great conversation next with our esteemed CUBE analyst, Dave Nicholson. Dave, great to have you here. Great to be working this event with you. >> Good to be here with you, Lisa. >> So there are, good to be here with you and about 80,000 people. >> Dave: That's right. >> Virtually and and physically. And it's jammed in, and this is the most jammed show I've seen in years. >> Dave: It's crazy. >> So much going on in the telecom industry. What are some of your expectations for what you're going to hear and see at this year's event? >> So, I expect to hear a lot about 5G. Specifically 5G private networks, and the disaggregation of the hardware and software stacks that have driven telecom for decades. So we're at this transition into 5G. From a consumer perspective, we feel like, oh well 5G has been around for years. In terms of where it's actually been deployed, we're just at the beginning stages of that. >> Right, right. Talk about the changing of the stack. You know, the disaggregation. Why now is it too late? And what are the advantages? That it's going to enable telcos to move faster, I imagine? >> Yeah, so it's really analogous to what we see in the general IT industry that we cover so much. The move to cloud, sometimes you're gaining performance. You're always gaining agility and flexibility. A big concern of the legacy telecom providers is going to be maintaining availability, reliability against a backdrop of increasing agility in the direction that they want to go. So that's going to be the conversation. It's going to be the old school folks, who are interested in maintaining primarily availability and performance, excuse me, contrasted with the open source, OpenStack providers, who are going to be saying, hey this is a path to the future. Without that path to the future, things will stagnate. >> Talk about some of those OpenStack providers. I imagine those are some of the folks that we know quite well? >> Sure, sure. Yeah, so someone like Dell, for example. They're perfectly positioned at this sort of crossroads, because Dell has been creating "cloud stacks," that will live sometimes on-premises. And those stacks of infrastructure, based on cots, commercial off-the-shelf components, integrated within an ecosystem can live at the edge, at literally the base of transmitter towers. So when you think about this whole concept of RAN or a radio access network, think of a cellular tower with an antenna and a transmitter. The transmitter might live on that tower, or it might live in pieces at the base of the tower. But there's always at that base of the tower, forget about the acronyms, it's a box of stuff, teleco stuff. All of these things historically have been integrated into single packages. >> Right. >> For good reason. >> Right. >> Think back to a mainframe, where it was utterly, absolutely reliable. We moved, in the general IT space, from the era of the mainframe to the world of client server, through virtualization, containerization. That exact transition is happening in the world of telecom right now. >> Why is it finally happening now? It seems a bit late, given that in our consumer lives, we have this expectation that we could be mobile 24 by seven. >> Right. Well it's because, first of all, we get mad if a call doesn't go through. How often, when you make, when you try to make a cellular call or when you try to send a text, how often does it not work? >> I can count on one hand. >> Right, rarely. >> Right. >> Now, you may be in an area that has spotty coverage. But when you're in an area where you have coverage it just works all of the time. And you expect it to work all of the time. And the miracle of the services that have been delivered to us over the last decade has really kind of blunted the need for next generation stuff. Well, we're at this transition point. And 5G as a technology enables so much more bandwidth. Think of it as, you know, throughput bandwidth latency. It allows the kind of performance characteristics so that things can be delivered that couldn't be delivered in the past. Virtual reality, augmented reality. We're already seeing you know 4K data streams to our phones. So, it's sort of lagged because of our expectations for absolute, rock solid, reliability. >> Yeah. >> The technology is ahead of that area now. And so this question is how do you navigate from utter reliability to awesome openness without sacrificing performance and reliability? >> Well, and also from a stack perspective, from looking at desegregation, and the opportunities there are for the telcos, but also the public cloud providers, are they friends, are they foes? What's the relationship like? >> They're going to be frenemies. >> Lisa: Frenemies? >> Yeah, coopetition is going to be the word of the day again. Yeah because when you think of a cloud, most people automatically think off-premises. >> Lisa: Yes. >> Maybe they even think automatically you know, hyper scale or Azure, GCP, AWS. In this case, it really is a question of cloud as an operating model. Cloud facilitating agility, cloud adopting cloud native architecture from a software perspective, so that you can rapidly deploy net new capabilities into an environment. You can't do that with proprietary closed systems that might use a waterfall development process and take years to develop. You and I have covered the Kubernetes world pretty closely. And what's the big thing that we hear constantly? The hunger, the thirst for human resources, >> Right. >> people who can actually work in this world of containerization. >> Yes, yes. >> Well guess what? In the macroeconomic environment, a lot of folks in the IT space have recently been disrupted. This is a place to look, if you have that skillset. Look at the telecom space, because they need people who are forward thinking in the era of cloud. But this concept of cloud is really, it's going to be, the telcos are both competing and partnering with what we think of as the traditional, hyper scale public cloud providers. >> And what do you think, one of the things that we know at MWC '23 is virtually every industry is represented here. Every vertical is here, whether it's a sports arena, or a retail outlet, or a manufacturer. Every organization, every industry needs to have networks that deliver what they need to do but also enable them to move faster and deliver what the end user wants. What are some of the industries that you think are really ripe for this disruption? And the ability to use private 5G networks, for example? >> Well, so it's interesting, you mentioned private 5G networks. I think a good example of the transition that's underway is this, the move to 4K video. So, you get a high definition television. The first time you see a 720p TV, it's like oh my gosh, amazing. Then we get 1080p, then it's 4K. People get 4K TVs, they bring them home, and there's no content. >> No. >> The first content, was it from your cable provider? No. >> Yeah. >> Was it over the air? ABC, NBC, CBS? No, it was YouTube. YouTube delivered the first reliable 4K content, over the internet. Similarly, everything comes to us now to our mobile devices. So we're not accessing the world around us so much from a desktop or even a laptop. It's mobile. So if you want to communicate with a customer, it's mobile. If you're creating a private 5G network, you now are standing something up that is net new in a greenfield environment. And you can deploy agility and functionality that the large scale telecom providers can't, because of the massive investment they might need. So the irony is, you have a factory that sits on 20 acres and you have folks traveling around, if you create a private 5G network, it might become, it might be more feature rich than what your employees are used to being able to access through their personal mobile devices. >> Wow. >> Yeah, because you're starting net new, you have the luxury of starting greenfield, as opposed to the responsibility and legacy for supporting a massive system that exists already. >> So then, what's in it for the existing incumbent telcos from an advantage opportunity perspective? Because you mentioned frenemies, coopetition. >> Right. >> There's irony there, as you talked about. >> Right, well you could look at it as either opportunity or headache. And it's both. Because they have very, very real SLAs that they need to meet. >> Right. >> Very, very real expectations that have been set in terms of reliability, availability, and performance. So they can't slip off of that. Making that transition is, I think going to be driven by economics, because the idea of having things be open means that there's competition for every part of the stack. There will be a critical role for integration vendors. Folks like Dell, and the ecosystems that they're creating around this will be critical, because often you would prefer to have one back to pat or one throat to choke instead of many. So, you still want to have that centralized entity to go to when something goes wrong. >> Right. >> Or when you want to implement something new. So, for the incumbents, it's a classic example of what you do in the face of disruption. How do you leverage technology? In my role as adjunct faculty at the Wharton CTO Academy, we talk about the CTO mindset. And the idea that your role is to leverage technology, in the service of your organization's mission, whatever that organization and mission is. So from a telecom provider perspective, they need to stay on top of this. >> Yes. >> Or they will be disrupted. >> Right. >> It's fascinating to think of how this disruption's taking place. >> Lisa: They have no choice, if they want to survive. >> No, yeah they have no choice. >> Lisa: In the next few years. >> They have no choice, but they'll come along, kicking and screaming. I'm sure if you had someone sitting here in the industry, they'd say, well, no, no, no, no, no. >> Yeah, of course. >> We love it! It's like, yeah, well but you're going to have to make some painful changes to adopt these things. >> What are some of the opportunities for those folks like Dell that you mentioned, in terms of coming in, being able to disrupt that stack, open things up? Great opportunities for the Dells, and other similar organizations to really start gaining a bigger foothold in the telecom industry, I imagine. >> Well, I look at it through the lens of sort of traditional IT and the transitions that we've been watching for the last couple of decades. It's exactly the same. I mean you, there is a parallel. It is like coming out of the mainframe era to the client server era. So, you know, we went in that transition, it was mainframe operating systems, very, very closed systems to more slightly opened. You know, the worlds of SUN and SGI and HP, and the likes, transitioned to kind of Microsoft based software running with like Dell hardware. >> Yeah. >> And, that stack is now getting deployed into one of the remaining legacy environments which is the telco space. So, the opportunity for Dell is pretty massive because on some fronts they're competing with the move to proper off-premises public cloud. >> Right. >> In this case, they are the future for telecom as opposed to sort of representing legacy, compared to some of the other cloud opportunities that are out there. >> So ultimately, what does a modern telecom network look like? I imagine, cloud native? Distributed? >> Yeah, yeah. So, traditionally, like I said, you've got the tower and the transmitters and the computer hardware that's running it. Those are then networked together. So you can sort of think of it as leaves on a twig, on a branch, on a tree. Eventually it gets into a core network, where there is terrestrial line communication and or communication up to satellites. And that's all been humming along just fine, making the transition from 3G to 4G to 5G. But, the real transition from a cloud perspective is this idea that you're taking these proprietary systems, disaggrevating, disaggrevating them and disaggregating them, carving them up into pieces where now you're introducing virtualization. So there's a VMware play here. Some things are virtualized using that stack. I think more often we're going to be talking about containerized and truly cloud native stacks. So instead of having the proprietary stack, where all the hardware and software is designed together. Now you're going to have Dell servers running some execution layer, orchestration layer, for cloud native, containerized applications and microservices. And that's the way things are going to be developed. >> And who, from a stakeholder perspective is involved here? 'Cause one of the things that I'm hearing is with this disaggregation of the staff, which is a huge change, what you're articulated, that's already happened at enterprise IT, change management is a hard thing to do. If they want to be successful, and well not just survive, they want to thrive. I'm just imagining, who are the stakeholders that are involved in having to push those incumbents to make these decisions, to move faster, to become agile, to compete. >> So, I remember when VMware had the problem that anytime they suggested introducing a hypervisor to to virtualize a physical machine and then run software on top or an operating system on top, and then applications, the big question the customer would have was, well is Microsoft going to support that? What if I can't get support from Microsoft? I dunno if I can do this. Within about a year of those conversations taking place, the question was, can I run this in my production environment? So it was, can I get support in my test environment too? Can I please run this in production? >> Yeah. >> And so, there are folks in the kind of legacy telecom world who are going to be afraid. It's, whatever the dynamic is, there is a no one ever got fired for buying from fill in the blank >> Exactly, yep. >> in the telecom space. >> Yeah, yeah. >> Because they would buy a consolidated, aggregated stack. >> Right. >> And, if something went wrong they could say, boom, blame you. And yeah, that stack doesn't lend itself to the kind of pace of change. >> Right. >> So it doesn't necessarily need the same kind of change management. Or at least it's very, very centralized. >> Okay. Okay. >> We're getting into the brave new world of things where if you let them spin out of control, you can have big problems. And that's where the folks like Dell come in, to make sure that yes, disaggregated, yes best of commercial off-the-shelf stuff, but also the best in terms of performance and reliability and availability. >> Yeah. >> So, that's the execution part, you must execute flawlessly. >> It sounds like from a thematic perspective, the theme of MWC '23 is velocity. But it seems like an underlying theme under that, or maybe an overlying theme is disruption. It's going to be so interesting, we're only on day one. We just started our coverage. Four days of wall to wall coverage on theCUBE. Excited to hear what you're excited about, what you learn over the next few days. We get to host some segments together. >> Yeah. >> But it seems like disruption is the overall theme. And it's going to be so interesting to see how this industry evolves, what the opportunities are, what the coopetition opportunities are. We're going to be learning a lot this week. I'm excited. >> Yeah, and what's fascinating to me about this whole thing is we talk about this, all of this tumultuous, disruptive stuff that's happening. For the average consumer, they're never going to be aware of it. >> Nope. >> Dave: They're just going to see services piled on top of services. >> Which is what we want. >> There are billions of people with mobile devices and the hundreds of billions, I don't know, trillions I guess at some point of connected devices at the edge. >> Lisa: Yes, yes. >> The whole concept of the internet of things. We'll sort of be blissfully unaware of what's happening at the middle. But there's a lot of action there. So we're going to be focusing on that action that's going on. In, you know, in in the middle of it. >> Yeah. >> But there's also some cool consumer stuff out here. >> There is. >> I know I'm going to be checking out the augmented reality and virtual reality stuff. >> Yeah, yeah. Well it's all about that customer experience. We expect things right away, 24/7, wherever we are in the world. And it's enabling that to make that happen. >> Yeah. >> Dave, thank you so much for really sharing what you think you're excited about for the event and some of the trends in telecom. It sounds like it's such an interesting time to be unpacking this. >> It's going to be a great week. >> It is going to be a great week. All right, for Dave Nicholson, I'm Lisa Martin. You're watching theCUBE, the leader in live tech coverage, covering day one of MWC '23. Stick around. We'll be back with our next guest in just a minute. (bright music resumes) (music fades out)

>>We're back at Super Computing, 22 in Dallas, winding down the final day here. A big show floor behind me. Lots of excitement out there, wouldn't you say, Dave? Just >>Oh, it's crazy. I mean, any, any time you have NASA presentations going on and, and steampunk iterations of cooling systems that the, you know, it's, it's >>The greatest. I've been to hundreds of trade shows. I don't think I've ever seen NASA exhibiting at one like they are here. Dave Nicholson, my co-host. I'm Paul Gell, in which with us is Satish Ier. He is the vice president of emerging services at Dell Technologies and Satit, thanks for joining us on the cube. >>Thank you. Paul, >>What are emerging services? >>Emerging services are actually the growth areas for Dell. So it's telecom, it's cloud, it's edge. So we, we especially focus on all the growth vectors for, for the companies. >>And, and one of the key areas that comes under your jurisdiction is called apex. Now I'm sure there are people who don't know what Apex is. Can you just give us a quick definition? >>Absolutely. So Apex is actually Dells for a into cloud, and I manage the Apex services business. So this is our way of actually bringing cloud experience to our customers, OnPrem and in color. >>But, but it's not a cloud. I mean, you don't, you don't have a Dell cloud, right? It's, it's of infrastructure as >>A service. It's infrastructure and platform and solutions as a service. Yes, we don't have our own e of a public cloud, but we want to, you know, this is a multi-cloud world, so technically customers want to consume where they want to consume. So this is Dell's way of actually, you know, supporting a multi-cloud strategy for our customers. >>You, you mentioned something just ahead of us going on air. A great way to describe Apex, to contrast Apex with CapEx. There's no c there's no cash up front necessary. Yeah, I thought that was great. Explain that, explain that a little more. Well, >>I mean, you know, one, one of the main things about cloud is the consumption model, right? So customers would like to pay for what they consume, they would like to pay in a subscription. They would like to not prepay CapEx ahead of time. They want that economic option, right? So I think that's one of the key tenets for anything in cloud. So I think it's important for us to recognize that and think Apex is basically a way by which customers pay for what they consume, right? So that's a absolutely a key tenant for how, how we want to design Apex. So it's absolutely right. >>And, and among those services are high performance computing services. Now I was not familiar with that as an offering in the Apex line. What constitutes a high performance computing Apex service? >>Yeah, I mean, you know, I mean, this conference is great, like you said, you know, I, there's so many HPC and high performance computing folks here, but one of the things is, you know, fundamentally, if you look at high performance computing ecosystem, it is quite complex, right? And when you call it as an Apex HPC or Apex offering offer, it brings a lot of the cloud economics and cloud, you know, experience to the HPC offer. So fundamentally, it's about our ability for customers to pay for what they consume. It's where Dell takes a lot of the day to day management of the infrastructure on our own so that customers don't need to do the grunge work of managing it, and they can really focus on the actual workload, which actually they run on the CHPC ecosystem. So it, it is, it is high performance computing offer, but instead of them buying the infrastructure, running all of that by themself, we make it super easy for customers to consume and manage it across, you know, proven designs, which Dell always implements across these verticals. >>So what, what makes the high performance computing offering as opposed to, to a rack of powered servers? What do you add in to make it >>Hpc? Ah, that's a great question. So, I mean, you know, so this is a platform, right? So we are not just selling infrastructure by the drink. So we actually are fundamentally, it's based on, you know, we, we, we launch two validated designs, one for life science sales, one for manufacturing. So we actually know how these PPO work together, how they actually are validated design tested solution. And we also, it's a platform. So we actually integrate the softwares on the top. So it's just not the infrastructure. So we actually integrate a cluster manager, we integrate a job scheduler, we integrate a contained orchestration layer. So a lot of these things, customers have to do it by themself, right? If they're buy the infrastructure. So by basically we are actually giving a platform or an ecosystem for our customers to run their workloads. So make it easy for them to actually consume those. >>That's Now is this, is this available on premises for customer? >>Yeah, so we, we, we make it available customers both ways. So we make it available OnPrem for customers who want to, you know, kind of, they want to take that, take that economics. We also make it available in a colo environment if the customers want to actually, you know, extend colo as that OnPrem environment. So we do both. >>What are, what are the requirements for a customer before you roll that equipment in? How do they sort of have to set the groundwork for, >>For Well, I think, you know, fundamentally it starts off with what the actual use case is, right? So, so if you really look at, you know, the two validated designs we talked about, you know, one for, you know, healthcare life sciences, and one other one for manufacturing, they do have fundamentally different requirements in terms of what you need from those infrastructure systems. So, you know, the customers initially figure out, okay, how do they actually require something which is going to require a lot of memory intensive loads, or do they actually require something which has got a lot of compute power. So, you know, it all depends on what they would require in terms of the workloads to be, and then we do havet sizing. So we do have small, medium, large, we have, you know, multiple infrastructure options, CPU core options. Sometimes the customer would also wanna say, you know what, as long as the regular CPUs, I also want some GPU power on top of that. So those are determinations typically a customer makes as part of the ecosystem, right? And so those are things which would, they would talk to us about to say, okay, what is my best option in terms of, you know, kind of workloads I wanna run? And then they can make a determination in terms of how, how they would actually going. >>So this, this is probably a particularly interesting time to be looking at something like HPC via Apex with, with this season of Rolling Thunder from various partners that you have, you know? Yep. We're, we're all expecting that Intel is gonna be rolling out new CPU sets from a powered perspective. You have your 16th generation of PowerEdge servers coming out, P C I E, gen five, and all of the components from partners like Invidia and Broadcom, et cetera, plugging into them. Yep. What, what does that, what does that look like from your, from your perch in terms of talking to customers who maybe, maybe they're doing things traditionally and they're likely to be not, not fif not 15 G, not generation 15 servers. Yeah. But probably more like 14. Yeah, you're offering a pretty huge uplift. Yep. What, what do those conversations look >>Like? I mean, customers, so talking about partners, right? I mean, of course Dell, you know, we, we, we don't bring any solutions to the market without really working with all of our partners, whether that's at the infrastructure level, like you talked about, you know, Intel, amd, Broadcom, right? All the chip vendors, all the way to software layer, right? So we have cluster managers, we have communities orchestrators. So we usually what we do is we bring the best in class, whether it's a software player or a hardware player, right? And we bring it together as a solution. So we do give the customers a choice, and the customers always want to pick what you they know actually is awesome, right? So they that, that we actually do that. And, you know, and one of the main aspects of, especially when you talk about these things, bringing it as a service, right? >>We take a lot of guesswork away from our customer, right? You know, one of the good example of HPC is capacity, right? So customers, these are very, you know, I would say very intensive systems. Very complex systems, right? So customers would like to buy certain amount of capacity, they would like to grow and, you know, come back, right? So give, giving them the flexibility to actually consume more if they want, giving them the buffer and coming down. All of those things are very important as we actually design these things, right? And that takes some, you know, customers are given a choice, but it actually, they don't need to worry about, oh, you know, what happens if I actually have a spike, right? There's already buffer capacity built in. So those are awesome things. When we talk about things as a service, >>When customers are doing their ROI analysis, buying CapEx on-prem versus, versus using Apex, is there a point, is there a crossover point typically at which it's probably a better deal for them to, to go OnPrem? >>Yeah, I mean, it it like specifically talking about hpc, right? I mean, why, you know, we do have a ma no, a lot of customers consume high performance compute and public cloud, right? That's not gonna go away, right? But there are certain reasons why they would look at OnPrem or they would look at, for example, Ola environment, right? One of the main reasons they would like to do that is purely have to do with cost, right? These are pretty expensive systems, right? There is a lot of ingress, egress, there is a lot of data going back and forth, right? Public cloud, you know, it costs money to put data in or actually pull data back, right? And the second one is data residency and security requirements, right? A lot of these things are probably proprietary set of information. We talked about life sciences, there's a lot of research, right? >>Manufacturing, a lot of these things are just, just in time decision making, right? You are on a factory floor, you gotta be able to do that. Now there is a latency requirement. So I mean, I think a lot of things play, you know, plays into this outside of just cost, but data residency requirements, ingress, egress are big things. And when you're talking about mass moments of data you wanna put and pull it back in, they would like to kind of keep it close, keep it local, and you know, get a, get a, get a price >>Point. Nevertheless, I mean, we were just talking to Ian Coley from aws and he was talking about how customers have the need to sort of move workloads back and forth between the cloud and on-prem. That's something that they're addressing without posts. You are very much in the, in the on-prem world. Do you have, or will you have facilities for customers to move workloads back and forth? Yeah, >>I wouldn't, I wouldn't necessarily say, you know, Dell's cloud strategy is multi-cloud, right? So we basically, so it kind of falls into three, I mean we, some customers, some workloads are suited always for public cloud. It's easier to consume, right? There are, you know, customers also consume on-prem, the customers also consuming Kohler. And we also have like Dell's amazing piece of software like storage software. You know, we make some of these things available for customers to consume a software IP on their public cloud, right? So, you know, so this is our multi-cloud strategy. So we announced a project in Alpine, in Delta fold. So you know, if you look at those, basically customers are saying, I love your Dell IP on this, on this product, on the storage, can you make it available through, in this public environment, whether, you know, it's any of the hyper skill players. So if we do all of that, right? So I think it's, it shows that, you know, it's not always tied to an infrastructure, right? Customers want to consume the best thumb and if we need to be consumed in hyperscale, we can make it available. >>Do you support containers? >>Yeah, we do support containers on hpc. We have, we have two container orchestrators we have to support. We, we, we have aner similarity, we also have a container options to customers. Both options. >>What kind of customers are you signing up for the, for the HPC offerings? Are they university research centers or is it tend to be smaller >>Companies? It, it's, it's, you know, the last three days, this conference has been great. We probably had like, you know, many, many customers talking to us. But HC somewhere in the range of 40, 50 customers, I would probably say lot of interest from educational institutions, universities research, to your point, a lot of interest from manufacturing, factory floor automation. A lot of customers want to do dynamic simulations on factory floor. That is also quite a bit of interest from life sciences pharmacies because you know, like I said, we have two designs, one on life sciences, one on manufacturing, both with different dynamics on the infrastructure. So yeah, quite a, quite a few interest definitely from academics, from life sciences, manufacturing. We also have a lot of financials, big banks, you know, who wants to simulate a lot of the, you know, brokerage, a lot of, lot of financial data because we have some, you know, really optimized hardware we announced in Dell for, especially for financial services. So there's quite a bit of interest from financial services as well. >>That's why that was great. We often think of Dell as, as the organization that democratizes all things in it eventually. And, and, and, and in that context, you know, this is super computing 22 HPC is like the little sibling trailing around, trailing behind the super computing trend. But we definitely have seen this move out of just purely academia into the business world. Dell is clearly a leader in that space. How has Apex overall been doing since you rolled out that strategy, what, two couple? It's been, it's been a couple years now, hasn't it? >>Yeah, it's been less than two years. >>How are, how are, how are mainstream Dell customers embracing Apex versus the traditional, you know, maybe 18 months to three year upgrade cycle CapEx? Yeah, >>I mean I look, I, I think that is absolutely strong momentum for Apex and like we, Paul pointed out earlier, we started with, you know, making the infrastructure and the platforms available to customers to consume as a service, right? We have options for customers, you know, to where Dell can fully manage everything end to end, take a lot of the pain points away, like we talked about because you know, managing a cloud scale, you know, basically environment for the customers, we also have options where customers would say, you know what, I actually have a pretty sophisticated IT organization. I want Dell to manage the infrastructure, but up to this level in the layer up to the guest operating system, I'll take care of the rest, right? So we are seeing customers who are coming to us with various requirements in terms of saying, I can do up to here, but you take all of this pain point away from me or you do everything for me. >>It all depends on the customer. So we do have wide interest. So our, I would say our products and the portfolio set in Apex is expanding and we are also learning, right? We are getting a lot of feedback from customers in terms of what they would like to see on some of these offers. Like the example we just talked about in terms of making some of the software IP available on a public cloud where they'll look at Dell as a software player, right? That's also is absolutely critical. So I think we are giving customers a lot of choices. Our, I would say the choice factor and you know, we are democratizing, like you said, expanding in terms of the customer choices. And I >>Think it's, we're almost outta our time, but I do wanna be sure we get to Dell validated designs, which you've mentioned a couple of times. How specific are the, well, what's the purpose of these designs? How specific are they? >>They, they are, I mean I, you know, so the most of these valid, I mean, again, we look at these industries, right? And we look at understanding exactly how would, I mean we have huge embedded base of customers utilizing HPC across our ecosystem in Dell, right? So a lot of them are CapEx customers. We actually do have an active customer profile. So these validated designs takes into account a lot of customer feedback, lot of partner feedback in terms of how they utilize this. And when you build these solutions, which are kind of end to end and integrated, you need to start anchoring on something, right? And a lot of these things have different characteristics. So these validated design basically prove to us that, you know, it gives a very good jump off point for customers. That's the way I look at it, right? So a lot of them will come to the table with, they don't come to the blank sheet of paper when they say, oh, you know what I'm, this, this is my characteristics of what I want. I think this is a great point for me to start from, right? So I think that that gives that, and plus it's the power of validation, really, right? We test, validate, integrate, so they know it works, right? So all of those are hypercritical. When you talk to, >>And you mentioned healthcare, you, you mentioned manufacturing, other design >>Factoring. We just announced validated design for financial services as well, I think a couple of days ago in the event. So yep, we are expanding all those DVDs so that we, we can, we can give our customers a choice. >>We're out of time. Sat ier. Thank you so much for joining us. Thank you. At the center of the move to subscription to everything as a service, everything is on a subscription basis. You really are on the leading edge of where, where your industry is going. Thanks for joining us. >>Thank you, Paul. Thank you Dave. >>Paul Gillum with Dave Nicholson here from Supercomputing 22 in Dallas, wrapping up the show this afternoon and stay with us for, they'll be half more soon.

(upbeat music) >> Welcome back to San Francisco, "theCUBE" is live, our day two coverage of VMware Explore 2022 continues. Lisa Martin with Dave Nicholson. Dave and I are pleased to welcome Jason Collier, principal member of technical staff at AMD to the program. Jason, it's great to have you. >> Thank you, it's great to be here. >> So what's going on at AMD? I hear you have some juicy stuff to talk about. >> Oh, we've got a ton of juicy stuff to talk about. Clearly the Project Monterey announcement was big for us, so we've got that to talk about. Another thing that I really wanted to talk about was a tool that we created and we call it, it's the VMware Architecture Migration Tool, call it VAMT for short. It's a tool that we created and we worked together with VMware and some of their professional services crew to actually develop this tool. And it is also an open source based tool. And really the primary purpose is to easily enable you to move from one CPU architecture to another CPU architecture, and do that in a cold migration fashion. >> So we're probably not talking about CPUs from Tandy, Radio Shack systems, likely this would be what we might refer to as other X86 systems. >> Other X86 systems is a good way to refer to it. >> So it's interesting timing for the development and the release of a tool like this, because in this sort of X86 universe, there are players who have been delayed in terms of delivering their next gen stuff. My understanding is AMD has been public with the idea that they're on track for by the end of the year, Genoa, next gen architecture. So can you imagine a situation where someone has an existing set of infrastructure and they're like, hey, you know what I want to get on board, the AMD train, is this something they can use from the VMware environment? >> Absolutely, and when you think about- >> Tell us exactly what that would look like, walk us through 100 servers, VMware, 1000 VMs, just to make the math easy. What do you do? How does it work? >> So one, there's several things that the tool can do, we actually went through, the design process was quite extensive on this. And we went through all of the planning phases that you need to go through to do these VM migrations. Now this has to be a cold migration, it's not a live migration. You can't do that between the CPU architectures. But what we do is you create a list of all of the virtual machines that you want to migrate. So we take this CSV file, we import this CSV file, and we ask for things like, okay, what's the name? Where do you want to migrate it to? So from one cluster to another, what do you want to migrate it to? What are the networks that you want to move it to? And then the storage platform. So we can move storage, it could either be shared storage, or we could move say from VSAN to VSAN, however you want to set it up. So it will do those storage migrations as well. And then what happens is it's actually going to go through, it's going to shut down the VM, it's going to take a snapshot, it is going to then basically move the compute and/or storage resources over. And once it does that, it's going to power 'em back up. And it's going to check, we've got some validation tools, where it's going to make sure VM Tools comes back up where everything is copacetic, it didn't blue screen or anything like that. And once it comes back up, then everything's good, it moves onto the next one. Now a couple of things that we've got feature wise, we built into it. You can parallelize these tasks. So you can say, how many of these machines do you want to do at any given time? So it could be, say 10 machines, 50 machines, 100 machines at a time, that you want to go through and do this move. Now, if it did blue screen, it will actually roll it back to that snapshot on the origin cluster. So that there is some protection on that. A couple other things that are actually in there are things like audit tracking. So we do full audit logging on this stuff, we take a snapshot, there's basically kind of an audit trail of what happens. There's also full logging, SYS logging, and then also we'll do email reporting. So you can say, run this and then shoot me a report when this is over. Now, one other cool thing is you can also actually define a change window. So I don't want to do this in the middle of the afternoon on a Tuesday. So I want to do this later at night, over the weekend, you can actually just queue this up, set it, schedule it, it'll run. You can also define how long you want that change window to be. And what it'll do, it'll do as many as it can, then it'll effectively stop, finish up, clean up the tasks and then send you a report on what all was successfully moved. >> Okay, I'm going to go down the rabbit hole a little bit on this, 'cause I think it's important. And if I say something incorrect, you correct me. >> No problem. >> In terms of my technical understanding. >> I got you. >> So you've got a VM, essentially a virtual machine typically will consist of an entire operating system within that virtual machine. So there's a construct that containerizes, if you will, the operating system, what is the difference, where is the difference in the instruction set? Where does it lie? Is it in the OS' interaction with the CPU or is it between the construct that is the sort of wrapper around the VM that is the difference? >> It's really primarily the OS, right? And we've not really had too many issues doing this and most of the time, what is going to happen, that OS is going to boot up, it's going to recognize the architecture that it's on, it's going to see the underlying architecture, and boot up. All the major operating systems that we test worked fine. I mean, typically they're going to work on all the X86 platforms. But there might be instruction sets that are kind of enabled in one architecture that may not be in another architecture. >> And you're looking for that during this process. >> Well usually the OS itself is going to kind of detect that. So if it pops up, the one thing that is kind of a caution that you need to look for. If you've got an application that's explicitly using an instruction set that's on one CPU vendor and not the other CPU vendor. That's the one thing where you're probably going to see some application differences. That said, it'll probably be compatible, but you may not get that instruction set advantage in it. >> But this tool remediates against that. >> Yeah, and what we do, we're actually using VM Tools itself to go through and validate a lot of those components. So we'll look and make sure VM Tools is enabled in the first place, on the source system. And then when it gets to the destination system, we also look at VM Tools to see what is and what is not enabled. >> Okay, I'm going to put you on the spot here. What's the zinger, where doesn't it work? You already said cold, we understand, you can schedule for cold migrations, that's not a zinger. What's the zinger, where doesn't it work? >> It doesn't work like, live migrations just don't work. >> No live, okay, okay, no live. What about something else? What's the oh, you've got that version, you've got that version of X86 architecture, it-won't work, anything? >> A majority of those cases work, where it would fail, where it's going to kick back and say, hey, VM Tools is not installed. So where you would see this is if you're running a virtual appliance from some vendor, like insert vendor here that say, got a firewall, or got something like that, and they don't have VM Tools enabled. It's going to fail it out of the gate, and say, hey, VM Tools is not on this, you might want to manually do it. >> But you can figure out how to fix that? >> You can figure out how to do that. You can also, and there's a flag in there, so in kind of the options that you give it, you say, ignore VM Tools, don't care, move it anyway. So if you've got less, some VMs that are in there, but they're not a priority VM, then it's going to migrate just fine. >> Got It. >> Can you elaborate a little bit on the joint development work that AMD and VMware are doing together and the value in it for customers? >> Yeah, so it's one of those things we worked with VMware to basically produce this open source tool. So we did a lot of the core component and design and we actually engaged VMware Professional Services. And a big shout out to Austin Browder. He helped us a ton in this project specifically. And we basically worked, we created this, kind of co-designed, what it was going to look like. And then jointly worked together on the coding, of pulling this thing together. And then after that, and this is actually posted up on VMware's public repos now in GitHub. So you can go to GitHub, you can go to the VMware samples code, and you can download this thing that we've created. And it's really built to help ease migrations from one architecture to another. So if you're looking for a big data center move and you got a bunch of VMs to move. I mean, even if it's same architecture to same architecture, it's definitely going to ease the pain of going through and doing a migration of, it's one thing when you're doing 10 machines, but when you're doing 10,000 virtual machines, that's a different story. It gets to be quite operationally inefficient. >> I lose track after three. >> Yeah. >> So I'm good for three, not four. >> I was going to ask you what your target market segment is here. Expand on that a little bit and talk to me about who you're working with and those organizations. >> So really this is targeted toward organizations that have large deployments in enterprise, but also I think this is a big play with channel partners as well. So folks out there in the channel that are doing these migrations and they do a lot of these, when you're thinking about the small and mid-size organizations, it's a great fit for that. Especially if they're kind of doing that upgrade, the lift and shift upgrade, from here's where you've been five to seven years on an architecture and you want to move to a new architecture. This is really going to help. And this is not a point and click GUI kind of thing. It's command line driven, it's using PowerShell, we're using PowerCLI to do the majority of this work. And for channel partners, this is an excellent opportunity to put the value and the value add and VAR, And there's a lot of opportunity for, I think, channel partners to really go and take this. And once again, being open source. We expect this to be extensible, we want the community to contribute and put back into this to basically help grow it and make it a more useful tool for doing these cold migrations between CPU architectures. >> Have you seen any in the last couple of years of dynamics, obviously across the world, any industries in particular that are really leading edge for what you guys are doing? >> Yeah, that's really, really interesting. I mean, we've seen it, it's honestly been a very horizontal problem, pretty much across all vertical markets. I mean, we've seen it in financial services, we've seen it in, honestly, pretty much across the board. Manufacturing, financial services, healthcare, we have seen kind of a strong interest in that. And then also we we've actually taken this and presented this to some of our channel partners as well. And there's been a lot of interest in it. I think we presented it to about 30 different channel partners, a couple of weeks back about this. And I got contact from 30 different channel partners that said they're interested in basically helping us work on it. >> Tagging on to Lisa's question, do you have visibility into the AMD thought process around the timing of your next gen release versus others that are competitors in the marketplace? How you might leverage that in terms of programs where partners are going out and saying, hey, perfect time, you need a refresh, perfect time to look at AMD, if you haven't looked at them recently. Do you have any insight into that in what's going on? I know you're focused on this area. But what are your thoughts on, well, what's the buzz? What's the buzz inside AMD on that? >> Well, when you look overall, if you look at the Gartner Hype Cycle, when VMware was being broadly adopted, when VMware was being broadly adopted, I'm going to be blunt, and I'm going to be honest right here, AMD didn't have a horse in the race. And the majority of those VMware deployments we see are not running on AMD. Now that said, there's an extreme interest in the fact that we've got these very cored in systems that are now coming up on, now you're at that five to seven year refresh window of pulling in new hardware. And we have extremely attractive hardware when it comes to running virtualized workloads. The test cluster that I'm running at home, I've got that five to seven year old gear, and I've got some of the, even just the Milan systems that we've got. And I've got three nodes of another architecture going onto AMD. And when I got these three nodes completely maxed to the number of VMs that I can run on 'em, I'm at a quarter of the capacity of what I'm putting on the new stuff. So what you get is, I mean, we worked the numbers, and it's definitely, it's like a 30% decrease in the amount of resources that you need. >> That's a compelling number. >> It's a compelling number. >> 5%, 10%, nobody's going to do anything for that. You talk 30%. >> 30%. It's meaningful, it's meaningful. Now you you're out of Austin, right? >> Yes. >> So first thing I thought of when you talk about running clusters in your home is the cost of electricity, but you're okay. >> I'm okay. >> You don't live here, you don't live here, you don't need to worry about that. >> I'm okay. >> Do you have a favorite customer example that you think really articulates the value of AMD when you're in customer conversations and they go, why AMD and you hit back with this? >> Yeah. Actually it's funny because I had a conversation like that last night, kind of random person I met later on in the evening. We were going through this discussion and they were facing exactly this problem. They had that five to seven year infrastructure. It's funny, because the guy was a gamer too, and he's like, man, I've always been a big AMD fan, I love the CPUs all the way since back in basically the Opterons and Athlons right. He's like, I've always loved the AMD systems, loved the graphics cards. And now with what we're doing with Ryzen and all that stuff. He's always been a big AMD fan. He's like, and I'm going through doing my infrastructure refresh. And I told him, I'm just like, well, hey, talk to your VAR and have 'em plug some AMD SKUs in there from the Dells, HPs and Lenovos. And then we've got this tool to basically help make that migration easier on you. And so once we had that discussion and it was great, then he swung by the booth today and I was able to just go over, hey, this is the tool, this is how you use it, here's all the info. Call me if you need any help. >> Yeah, when we were talking earlier, we learned that you were at Scale. So what are you liking about AMD? How does that relate? >> The funny thing is this is actually the first time in my career that I've actually had a job where I didn't work for myself. I've been doing venture backed startups the last 25 years and we've raised couple hundred million dollars worth of investment over the years. And so one, I figured, here I am going to AMD, a larger corporation. I'm just like, am I going to be able to make it a year? And I have been here longer than a year and I absolutely love it. The culture at AMD is amazing. We still have that really, I mean, almost it's like that underdog mentality within the organization. And the team that I'm working with is a phenomenal team. And it's actually, our EVP and our Corp VP, were actually my executive sponsors, we were at a prior company. They were one of my executive sponsors when I was at Scale. And so my now VP boss calls me up and says, hey, I'm putting a band together, are you interested? And I was kind of enjoying a semi-retirement lifestyle. And then I'm just like, man, because it's you, yes, I am interested. And the group that we're in, the work that we're doing, the way that we're really focusing on forward looking things that are affecting the data center, what's going to be the data center like three to five years from now. It's exciting, and I am having a blast, I'm having the time of my life. I absolutely love it. >> Well, that relationship and the trust that you will have with each other, that bleeds into the customer conversations, the partner conversations, the employee conversations, it's all inextricably linked. >> Yes it is. >> And we want to know, you said three to five years out, like what? Like what? Just general futurist stuff, where do you think this is going. >> Well, it's interesting. >> So moon collides with the earth in 2025, we already know that. >> So we dialed this back to the Pensando acquisition. When you look at the Pensando acquisition and you look at basically where data centers are today, but then you look at where basically the big hyperscalers are. You look at an AWS, you look at their architecture, you specifically wrap Nitro around that, that's a very different architecture than what's being run in the data center. And when you look at what Pensando does, that's a lot of starting to bring what these real clouds out there, what these big hyperscalers are running into the grasps of the data center. And so I think you're going to see a fundamental shift. The next 10 years are going to be exciting because the way you look at a data center now, when you think of what CPUs do, what shared storage, how the networking is all set up, it ain't going to look the same. >> Okay, so the competing vision with that, to play devil's advocate, would be DPUs are kind of expensive. Why don't we just use NICs, give 'em some more bandwidth, and use the cheapest stuff. That's the competing vision. >> That could be. >> Or the alternative vision, and I imagine everything else we've experienced in our careers, they will run in parallel paths, fit for function. >> Well, parallel paths always exist, right? Otherwise, 'cause you know how many times you've heard mainframe's dead, tape's dead, spinning disk is dead. None of 'em dead, right? The reality is you get to a point within an industry where it basically goes from instead of a growth curve like that, it goes to a growth curve of like that, it's pretty flat. So from a revenue growth perspective, I don't think you're going to see the revenue growth there. I think you're going to see the revenue growth in DPUs. And when you actually take, they may be expensive now, but you look at what Monterey's doing and you look at the way that those DPUs are getting integrated in at the OEM level. It's going to be a part of it. You're going to order your VxRail and VSAN style boxes, they're going to come with them. It's going to be an integrated component. Because when you start to offload things off the CPU, you've driven your overall utilization up. When you don't have to process NSX on basically the X86, you've just freed up cores and a considerable amount of them. And you've also moved that to where there's a more intelligent place for that pack to be processed right, out here on this edge. 'Cause you know what, that might not need to go into the host bus at all. So you have just alleviated any transfers over a PCI bus, over the PCI lanes, into DRAM, all of these components, when you're like, but all to come with, oh, that bit needs to be on this other machine. So now it's coming in and it's making that decision there. And then you take and integrate that into things like the Aruba Smart Switch, that's running the Pensando technology. So now you got top of rack that is already making those intelligent routing decisions on where packets really need to go. >> Jason, thank you so much for joining us. I know you guys could keep talking. >> No, I was going to say, you're going to have to come back. You're going to have to come back. >> We've just started to peel the layers of the onion, but we really appreciate you coming by the show, talking about what AMD and VMware are doing, what you're enabling customers to achieve. Sounds like there's a lot of tailwind behind you. That's awesome. >> Yeah. >> Great stuff, thank you. >> It's a great time to be at AMD, I can tell you that. >> Oh, that's good to hear, we like it. Well, thank you again for joining us, we appreciate it. For our guest and Dave Nicholson, I'm Lisa Martin. You're watching "theCUBE Live" from San Francisco, VMware Explore 2022. We'll be back with our next guest in just a minute. (upbeat music)

(upbeat music) >> We're back at VeeamON 2022. We're here at the Aria in Las Vegas Dave Vellante with Dave Nicholson. Bill Andrews is here. He's the president and CEO of ExaGrid, mass boy. Bill, thanks for coming on theCUBE. >> Thanks for having me. >> So I hear a lot about obviously data protection, cyber resiliency, what's the big picture trends that you're seeing when you talk to customers? >> Well, I think clearly we were talking just a few minutes ago, data's growing like crazy, right This morning, I think they said it was 28% growth a year, right? So data's doubling almost just a little less than every three years. And then you get the attacks on the data which was the keynote speech this morning as well, right. All about the ransomware attacks. So we've got more and more data, and that data is more and more under attack. So I think those are the two big themes. >> So ExaGrid as a company been around for a long time. You've kind of been the steady kind of Eddy, if you will. Tell us about ExaGrid, maybe share with us some of the differentiators that you share with customers. >> Sure, so specifically, let's say in the Veeam world you're backing up your data, and you really only have two choices. You can back that up to disc. So some primary storage disc from a Dell, or a Hewlett Packard, or an NetApp or somebody, or you're going to back it up to what's called an inline deduplication appliance maybe a Dell Data Domain or an HPE StoreOnce, right? So what ExaGrid does is we've taken the best of both those but not the challenges of both those and put 'em together. So with disc, you're going to get fast backups and fast restores, but because in backup you keep weekly's, monthly's, yearly retention, the cost of this becomes exorbitant. If you go to a deduplication appliance, and let's say the Dell or the HPs, the data comes in, has to be deduplicated, compare one backup to the next to reduce that storage, which lowers the cost. So fixes that problem, but the fact that they do it inline slows the backups down dramatically. All the data is deduplicated so the restores are slow, and then the backup window keeps growing as the data grows 'cause they're all scale up technologies. >> And the restores are slow 'cause you got to rehydrate. >> You got to rehydrate every time. So what we did is we said, you got to have both. So our appliances have a front end disc cache landing zone. So you're right directed to the disc., Nothing else happens to it, whatever speed the backup app could write at that's the speed we take it in at. And then we keep the most recent backups in that landing zone ready to go. So you want to boot a VM, it's not an hour like a deduplication appliance it's a minute or two. Secondly, we then deduplicate the data into a second tier which is a repository tier, but we have all the deduplicated data for the long term retention, which gets the cost down. And on top of that, we're scale out. Every appliance has networking processor memory end disc. So if you double, triple, quadruple the data you double, triple, quadruple everything. And if the backup window is six hours at 100 terabyte it's six hours at 200 terabyte, 500 terabyte, a petabyte it doesn't matter. >> 'Cause you scale out. >> Right, and then lastly, our repository tier is non-network facing. We're the only ones in the industry with this. So that under a ransomware attack, if you get hold of a rogue server or you hack the media server, get to the backup storage whether it's disc or deduplication appliance, you can wipe out all the backup data. So you have nothing to recover from. In our case, you wipe it out, our landing zone will be wiped out. We're no different than anything else that's network facing. However, the only thing that talks to our repository tier is our object code. And we've set up security policies as to how long before you want us to delete data, let's say 10 days. So if you have an attack on Monday that data doesn't get deleted till like a week from Thursday, let's say. So you can freeze the system at any time and do restores. And then we have immutable data objects and all the other stuff. But the culmination of a non-network facing tier and the fact that we do the delayed deletes makes us the only one in the industry that can actually truly recover. And that's accelerating our growth, of course. >> Wow, great description. So that disc cache layer is a memory, it's a flash? >> It's disc, it's spinning disc. >> Spinning disc, okay. >> Yeah, no different than any other disc. >> And then the tiered is what, less expensive spinning disc? >> No, it's still the same. It's all SaaS disc 'cause you want the quality, right? So it's all SaaS, and so we use Western Digital or Seagate drives just like everybody else. The difference is that we're not doing any deduplication coming in or out of that landing zone to have fast backups and fast restores. So think of it like this, you've got disc and you say, boy it's too expensive. What I really want to do then is put maybe a deduplication appliance behind it to lower the cost or reverse it. I've got a deduplication appliance, ugh, it's too slow for backups and restores. I really want to throw this in front of it to have fast backups first. Basically, that's what we did. >> So where does the cost savings, Bill come in though, on the tier? >> The cost savings comes in the fact that we got deduplication in that repository. So only the most recent backup >> Ah okay, so I get it. >> are the duplicated data. But let's say you had 40 copies of retention. You know, 10 weekly's, 36 monthly's, a few yearly. All of that's deduplicated >> Okay, so you're deduping the stuff that's not as current. >> Right. >> Okay. >> And only a handful of us deduplicate at the layer we do. In other words, deduplication could be anywhere from two to one, up to 50 to one. I mean it's all over the place depending on the algorithm. Now it's what everybody's algorithms do. Some backup apps do two to one, some do five to one, we do 20 to one as well as much as 50 to one depending on the data types. >> Yeah, so the workload is going to largely determine the combination >> The content type, right. with the algos, right? >> Yeah, the content type. >> So the part of the environment that's behind the illogical air gap, if you will, is deduped data. >> Yes. >> So in this case, is it fair to say that you're trading a positive economic value for a little bit longer restore from that environment? >> No, because if you think about backup 95% of the customers restores are from the most recent data. >> From the disc cache. >> 95% of the time 'cause you think about why do you need fast restores? Somebody deleted a file, somebody overwrote a file. They can't go work, they can't open a file. It's encrypted, it's corrupted. That's what IT people are trying to keep users productive. When do you go for longer-term retention data? It's an SEC audit. It's a HIPAA audit. It's a legal discovery, you don't need that data right away. You have days and weeks to get that ready for that legal discovery or that audit. So we found that boundary where you keep users productive by keeping the most recent data in the disc cache landing zone, but anything that's long term. And by the way, everyone else is long term, at that point. >> Yeah, so the economics are comparable to the dedupe upfront. Are they better, obviously get the performance advance? >> So we would be a lot looped. The thing we replaced the most believe it or not is disc, we're a lot less expensive than the disc. I was meeting with some Veeam folks this morning and we were up against Cisco 3260 disc at a children's hospital. And on our quote was $500,000. The disc was 1.4 million. Just to give you an example of the savings. On a Data Domain we're typically about half the price of a Data Domain. >> Really now? >> The reason why is their front end control are so expensive. They need the fastest trip on the planet 'cause they're trying to do inline deduplication. >> Yeah, so they're chasing >> They need the fastest memory >> on the planet. >> this chips all the time. They need SSD on data to move in and out of the hash table. In order to keep up with inline, they've got to throw so much compute at it that it drives their cost up. >> But now in the case of ransomware attack, are you saying that the landing zone is still available for recovery in some circumstances? Or are you expecting that that disc landing zone would be encrypted by the attacker? >> Those are two different things. One is deletion, one is encryption. So let's do the first scenario. >> I'm talking about malicious encryption. >> Yeah, absolutely. So the first scenario is the threat actor encrypts all your primary data. What's does he go for next? The backup data. 'Cause he knows that's your belt and suspend is to not pay the ransom. If it's disc he's going to go in and put delete commands at the disc, wipe out the disc. If it's a data domain or HPE StoreOnce, it's all going to be gone 'cause it's one tier. He's going to go after our landing zone, it's going to be gone too. It's going to wipe out our landing zone. Except behind that we have the most recent backup deduplicate in the repository as well as all the other backups. So what'll happen is they'll freeze the system 'cause we weren't going to delete anything in the repository for X days 'cause you set up a policy, and then you restore the most recent backup into the landing zone or we can restore it directly to your primary storage area, right? >> Because that tier is not network facing. >> That's right. >> It's fenced off essentially. >> People call us every day of the week saying, you saved me, you saved me again. People are coming up to me here, you saved me, you saved me. >> Tell us a story about that, I mean don't give me the names but how so. >> I'll actually do a funnier story, 'cause these are the ones that our vendors like to tell. 'Cause I'm self-serving as the CEO that's good of course, a little humor. >> It's your 15 minutes of job. >> That is my 15 minutes of fame. So we had one international company who had one ExaGrid at one location, 19 Data Domains at the other locations. Ransomware attack guess what? 19 Data Domains wiped out. The one ExaGrid, the only place they could restore. So now all 20 locations of course are ExaGrids, China, Russia, Mexico, Germany, US, et cetera. They rolled us out worldwide. So it's very common for that to occur. And think about why that is, everyone who's network facing you can get to the storage. You can say all the media servers are buttoned up, but I can find a rogue server and snake my way over the storage, I can. Now, we also of course support the Veeam Data Mover. So let's talk about that since we're at a Veeam conference. We were the first company to ever integrate the Veeam Data Mover. So we were the first actually ever integration with Veeam. And so that Veeam Data Mover is a protocol that goes from Veeam to the ExaGrid, and we run it on both ends. So that's a more secure protocol 'cause it's not an open format protocol like SaaS. So with running the Veeam Data Mover we get about 30% more performance, but you do have a more secure protocol layer. So if you don't get through Veeam but you get through the protocol, boom, we've got a stronger protocol. If you make it through that somehow, or you get to it from a rogue server somewhere else we still have the repository. So we have all these layers so that you can't get at it. >> So you guys have been at this for a while, I mean decade and a half plus. And you've raised a fair amount of money but in today's terms, not really. So you've just had really strong growth, sequential growth. I understand it, and double digit growth year on year. >> Yeah, about 25% a year right now >> 25%, what's your global strategy? >> So we have sales offices in about 30 countries already. So we have three sales teams in Brazil, and three in Germany, and three in the UK, and two in France, and a lot of individual countries, Chile, Argentina, Columbia, Mexico, South Africa, Saudi, Czech Republic, Poland, Dubai, Hong Kong, Australia, Singapore, et cetera. We've just added two sales territories in Japan. We're adding two in India. And we're installed in over 50 countries. So we've been international all along the way. The goal of the company is we're growing nicely. We have not raised money in almost 10 years. >> So you're self-funding. You're cash positive. >> We are cash positive and self-funded and people say, how have you done that for 10 years? >> You know what's interesting is I remember, Dave Scott, Dave Scott was the CEO of 3PAR, and he told me when he came into that job, he told the VCs, they wanted to give him 30 million. He said, I need 80 million. I think he might have raised closer to a hundred which is right around what you guys have raised. But like you said, you haven't raised it in a long time. And in today's terms, that's nothing, right? >> 100 is 500 in today's terms. >> Yeah, right, exactly. And so the thing that really hurt 3PAR, they were public companies so you could see all this stuff is they couldn't expand internationally. It was just too damn expensive to set up the channels, and somehow you guys have figured that out. >> 40% of our business comes out of international. We're growing faster internationally than we are domestically. >> What was the formula there, Bill, was that just slow and steady or? >> It's a great question. >> No, so what we did, we said let's build ExaGrid like a McDonald's franchise, nobody's ever done that before in high tech. So what does that mean? That means you have to have the same product worldwide. You have to have the same spares model worldwide. You have to have the same support model worldwide. So we early on built the installation. So we do 100% of our installs remotely. 100% of our support remotely, yet we're in large enterprises. Customers racks and stacks the appliances we get on with them. We do the entire install on 30 minutes to about three hours. And we've been developing that into the product since day one. So we can remotely install anywhere in the world. We keep spares depots all over the world. We can bring 'em up really quick. Our support model is we have in theater support people. So they're in Europe, they're in APAC, they're in the US, et cetera. And we assign customers to the support people. So they deal with the same support person all the time. So everything is scalable. So right now we're going to open up India. It's the same way we've opened up every other country. Once you've got the McDonald's formula we just stamp it all over the world. >> That's amazing. >> Same pricing, same product same model, same everything. >> So what was the inspiration for that? I mean, you've done this since day one, which is what like 15, 16 years ago. Or just you do engineering or? >> No, so our whole thought was, first of all you can't survive anymore in this world without being an international company. 'Cause if you're going to go after large companies they have offices all over the world. We have companies now that have 17, 18, 20, 30 locations. And there were in every country in the world, you can't go into this business without being able to ship anywhere in the world and support it for a single customer. You're not going into Singapore because of that. You're going to Singapore because some company in Germany has offices in the U.S, Mexico Singapore and Australia. You have to be international. It's a must now. So that was the initial thing is that, our goal is to become a billion dollar company. And we're on path to do that, right. >> You can see a billion. >> Well, I can absolutely see a billion. And we're bigger than everybody thinks. Everybody guesses our revenue always guesses low. So we're bigger than you think. The reason why we don't talk about it is we don't need to. >> That's the headline for our writers, ExaGrid is a billion dollar company and nobody's know about it. >> Million dollar company. >> On its way to a billion. >> That's right. >> You're not disclosing. (Bill laughing) But that's awesome. I mean, that's a great story. I mean, you kind of are a well kept secret, aren't you? >> Well, I dunno if it's a well kept secret. You know, smaller companies never have their awareness of big companies, right? The Dells of the world are a hundred billion. IBM is 70 billion, Cisco is 60 billion. Easy to have awareness, right? If you're under a billion, I got to give a funny story then I think we got to close out here. >> Oh go ahead please. >> So there's one funny story. So I was talking to the CIO of a super large Fortune 500 company. And I said to him, "Just so who do you use?" "I use IBM Db2, and I use, Cisco routers, and I use EMC primary storage, et cetera. And I use all these big." And I said, "Would you ever switch from Db2?" "Oh no, the switching costs would kill me. I could never go to Oracle." So I said to him, "Look would you ever use like a Pure Storage, right. A couple billion dollar company." He says, "Who?" >> Huh, interesting. >> I said to him, all right so skip that. I said, "VMware, would you ever think about going with Nutanix?" "Who?" Those are billion dollar plus companies. And he was saying who? >> Public companies. >> And he was saying who? That's not uncommon when I talk to CIOs. They see the big 30 and that's it. >> Oh, that's interesting. What about your partnership with Veeam? Tell us more about that. >> Yeah, so I would actually, and I'm going to be bold when I say this 'cause I think you can ask anybody here at the conference. We're probably closer first of all, to the Veeam sales force than any company there is. You talk to any Veeam sales rep, they work closer with ExaGrid than any other. Yeah, we are very tight in the field and have been for a long time. We're integrated with the Veeam Data Boomer. We're integrated with SOBR. We're integrated with all the integrations or with the product as well. We have a lot of joint customers. We actually do a lot of selling together, where we go in as Veeam ExaGrid 'cause it's a great end to end story. Especially when we're replacing, let's say a Dell Avamar to Dell Data Domain or a Dell Network with a Dell Data Domain, very commonly Veeam ExaGrid go in together on those types of sales. So we do a lot of co-selling together. We constantly train their systems engineers around the world, every given week we're training either inside sales teams, and we've trained their customer support teams in Columbus and Prague. So we're very tight with 'em we've been tight for over a decade. >> Is your head count public? Can you share that with us? >> So we're just over 300 employees. >> Really, wow. >> We have 70 open positions, so. >> Yeah, what are you looking for? Yeah, everything, right? >> We are looking for engineers. We are looking for customer support people. We're looking for marketing people. We're looking for inside sales people, field people. And we've been hiring, as of late, major account reps that just focus on the Fortune 500. So we've separated that out now. >> When you hire engineers, I mean I think I saw you were long time ago, DG, right? Is that true? >> Yeah, way back in the '80s. >> But systems guy. >> That's how old I am. >> Right, systems guy. I mean, I remember them well Eddie Castro and company. >> Tom West. >> EMV series. >> Tom West was the hero of course. >> The EMV 4000, the EMV 20,000, right? >> When were kids, "The Soul of a New Machine" was the inspirational book but anyway, >> Yeah Tracy Kidder, it was great. >> Are you looking for systems people, what kind of talent are you looking for in engineering? >> So it's a lot of Linux programming type stuff in the product 'cause we run on a Linux space. So it's a lot of Linux programs so its people in those storage. >> Yeah, cool, Bill, hey, thanks for coming on to theCUBE. Well learned a lot, great story. >> It's a pleasure. >> That was fun. >> Congratulations. >> Thanks. >> And good luck. >> All right, thank you. >> All right, and thank you for watching theCUBE's coverage of VeeamON 2022, Dave Vellante for Dave Nicholson. We'll be right back right after this short break, stay with us. (soft beat music)

(bright music) >> Okay, we're back in theCUBE. We said we were signing off for the night, but during the hallway track, we ran into old friend Stu Miniman who was the Director of Market Insights at Red Hat. Stu, friend of theCUBE done the thousands of CUBE interviews. >> Dave, it's great to be here. Thanks for pulling me on, you and I hosted Red Hat Summit before. It's great to see Paul here. I was actually, I was talking to some of the Red Hatters walking around Boston. It's great to have an event here. Boston's got strong presence and I understand, I think was either first or second year, they had it over... What's the building they're tearing down right down the road here. Was that the World Trade Center? I think that's where they actually held it, the first time they were here. We hosted theCUBE >> So they moved up. >> at the Hines Convention Center. We did theCUBE for summit at the BCEC next door. And of course, with the pandemic being what it was, we're a little smaller, nice intimate event here. It's great to be able to room the hall, see a whole bunch of people and lots watching online. >> It's great, it's around the same size as those, remember those Vertica Big Data events that we used to have here. And I like that you were commenting out at the theater and the around this morning for the keynotes, that was good. And the keynotes being compressed, I think, is real value for the attendees, you know? 'Cause people come to these events, they want to see each other, you know? They want to... It's like the band getting back together. And so when you're stuck in the keynote room, it's like, "Oh, it's okay, it's time to go." >> I don't know that any of us used to sitting at home where I could just click to another tab or pause it or run for, do something for the family, or a quick bio break. It's the three-hour keynote I hope has been retired. >> But it's an interesting point though, that the virtual event really is driving the physical and this, the way Red Hat marketed this event was very much around the virtual attendee. Physical was almost an afterthought, so. >> Right, this is an invite only for in-person. So you're absolutely right. It's optimizing the things that are being streamed, the online audience is the big audience. And we just happy to be in here to clap and do some things see around what you're doing. >> Wonderful see that becoming the norm. >> I think like virtual Stu, you know this well when virtual first came in, nobody had a clue with what they were doing. It was really hard. They tried different things, they tried to take the physical and just jam it into the virtual. That didn't work, they tried doing fun things. They would bring in a famous person or a comedian. And that kind of worked, I guess, but everybody showed up for that and then left. And I think they're trying to figure it out what this hybrid thing is. I've seen it both ways. I've seen situations like this, where they're really sensitive to the virtual. I've seen others where that's the FOMO of the physical, people want physical. So, yeah, I think it depends. I mean, reinvent last year was heavy physical. >> Yeah, with 15,000 people there. >> Pretty long keynotes, you know? So maybe Amazon can get away with it, but I think most companies aren't going to be able to. So what is the market telling you? What are these insights? >> So Dave just talking about Amazon, obviously, the world I live in cloud and that discussion of cloud, the journey that customers are going on is where we're spending a lot of the discussions. So, it was great to hear in the keynote, talked about our deep partnerships with the cloud providers and what we're doing to help people with, you like to call it super cloud, some call it hybrid, or multi-cloud... >> New name. (crosstalk) Meta-Cloud, come on. >> All right, you know if Che's my executive, so it's wonderful. >> Love it. >> But we'll see, if I could put on my VR Goggles and that will help me move things. But I love like the partnership announcement with General Motors today because not every company has the needs of software driven electric vehicles all over the place. But the technology that we build for them actually has ramifications everywhere. We've working to take Kubernetes and make it smaller over time. So things that we do at the edge benefit the cloud, benefit what we do in the data center, it's that advancement of science and technology just lifts all boats. >> So what's your take on all this? The EV and software on wheels. I mean, Tesla obviously has a huge lead. It's kind of like the Amazon of vehicles, right? It's sort of inspired a whole new wave of innovation. Now you've got every automobile manufacturer kind of go and after. That is the future of vehicles is something you followed or something you have an opinion on Stu? >> Absolutely. It's driving innovation in some ways, the way the DOS drove innovation on the desktop, if you remember the 64K DOS limit, for years, that was... The software developers came up with some amazing ways to work within that 64K limit. Then when it was gone, we got bloatware, but it actually does enforce a level of discipline on you to try to figure out how to make software run better, run more efficiently. And that has upstream impacts on the enterprise products. >> Well, right. So following your analogy, you talk about the enablement to the desktop, Linux was a huge influence on allowing the individual person to write code and write software, and what's happening in the EV, it's software platform. All of these innovations that we're seeing across industries, it's how is software transforming things. We go back to the mark end reasons, software's eating the world, open source is the way that software is developed. Who's at the intersection of all those? We think we have a nice part to play in that. I loved tha- Dave, I don't know if you caught at the end of the keynote, Matt Hicks basically said, "Our mission isn't just to write enterprise software. "Our mission is based off of open source because open source unlocks innovation for the world." And that's one of the things that drew me to Red Hat, it's not just tech in good places, but allowing underrepresented, different countries to participate in what's happening with software. And we can all move that ball forward. >> Well, can we declare victory for open source because it's not just open source products, but everything that's developed today, whether proprietary or open has open source in it. >> Paul, I agree. Open source is the development model period, today. Are there some places that there's proprietary? Absolutely. But I had a discussion with Deepak Singh who's been on theCUBE many times. He said like, our default is, we start with open source code. I mean, even Amazon when you start talking about that. >> I said this, the $70 billion business on open source. >> Exactly. >> Necessarily give it back, but that say, Hey, this is... All's fair in tech and more. >> It is interesting how the managed service model has sort of rescued open source, open source companies, that were trying to do the Red Hat model. No one's ever really successfully duplicated the Red Hat model. A lot of companies were floundering and failing. And then the managed service option came along. And so now they're all cloud service providers. >> So the only thing I'd say is that there are some other peers we have in the industry that are built off open source they're doing okay. The recent example, GitLab and Hashicorp, both went public. Hashi is doing some managed services, but it's not the majority of their product. Look at a company like Mongo, they've heavily pivoted toward the managed service. It is where we see the largest growth in our area. The products that we have again with Amazon, with Microsoft, huge growth, lots of interest. It's one of the things I spend most of my time talking on. >> I think Databricks is another interesting example 'cause Cloudera was the now company and they had the sort of open core, and then they had the proprietary piece, and they've obviously didn't work. Databricks when they developed Spark out of Berkeley, everybody thought they were going to do kind of a similar model. Instead, they went for all in managed services. And it's really worked well, I think they were ahead of that curve and you're seeing it now is it's what customers want. >> Well, I mean, Dave, you cover the database market pretty heavily. How many different open source database options are there today? And that's one of the things we're solving. When you look at what is Red Hat doing in the cloud? Okay, I've got lots of databases. Well, we have something called, it's Red Hat Open Database Access, which is from a developer, I don't want to have to think about, I've got six different databases, which one, where's the repository? How does all that happen? We give that consistency, it's tied into OpenShift, so it can help abstract some of those pieces. we've got same Kafka streaming and we've got APIs. So it's frameworks and enablers to help bridge that gap between the complexity that's out there, in the cloud and for the developer tool chain. >> That's really important role you guys play though because you had this proliferation, you mentioned Mongo. So many others, Presto and Starbursts, et cetera, so many other open source options out there now. And companies, developers want to work with multiple databases within the same application. And you have a role in making that easy. >> Yeah, so and that is, if you talk about the question I get all the time is, what's next for Kubernetes? Dave, you and I did a preview for KubeCon and it's automation and simplicity that we need to be. It's not enough to just say, "Hey, we've got APIs." It's like Dave, we used to say, "We've got standards? Great." Everybody's implementation was a little bit different. So we have API Sprawl today. So it's building that ecosystem. You've been talking to a number of our partners. We are very active in the community and trying to do things that can lift up the community, help the developers, help that cloud native ecosystem, help our customers move faster. >> Yeah API's better than scripts, but they got to be managed, right? So, and that's really what you guys are doing that's different. You're not trying to own everything, right? It's sort of antithetical to how billions and trillions are made in the IT industry. >> I remember a few years ago we talked here, and you look at the size that Red Hat is. And the question is, could Red Hat have monetized more if the model was a little different? It's like, well maybe, but that's not the why. I love that they actually had Simon Sinek come in and work with Red Hat and that open, unlocks the world. Like that's the core, it's the why. When I join, they're like, here's a book of Red Hat, you can get it online and that why of what we do, so we never have to think of how do we get there. We did an acquisition in the security space a year ago, StackRox, took us a year, it's open source. Stackrox.io, it's community driven, open source project there because we could have said, "Oh, well, yeah, it's kind of open source and there's pieces that are open source, but we want it to be fully open source." You just talked to Gunnar about how he's RHEL nine, based off CentOS stream, and now developing out in the open with that model, so. >> Well, you were always a big fan of Whitehurst culture book, right? It makes a difference. >> The open organization and right, Red Hat? That culture is special. It's definitely interesting. So first of all, most companies are built with the hierarchy in mind. Had a friend of mine that when he joined Red Hat, he's like, I don't understand, it's almost like you have like lots of individual contractors, all doing their things 'cause Red Hat works on thousands of projects. But I remember talking to Rackspace years ago when OpenStack was a thing and they're like, "How do you figure out what to work on?" "Oh, well we hired great people and they work on what's important to them." And I'm like, "That doesn't sound like a business." And he is like, "Well, we struggle sometimes to that balance." Red Hat has found that balance because we work on a lot of different projects and there are people inside Red Hat that are, you know, they care more about the project than they do the business, but there's the overall view as to where we participate and where we productize because we're not creating IP because it's all an open source. So it's the monetizations, the relationships we have our customers, the ecosystems that we build. And so that is special. And I'll tell you that my line has been Red Hat on the inside is even more Red Hat. The debates and the discussions are brutal. I mean, technical people tearing things apart, questioning things and you can't be thin skinned. And the other thing is, what's great is new people. I've talked to so many people that started at Red Hat as interns and will stay for seven, eight years. And they come there and they have as much of a seat at the table, and when I talk to new people, your job, is if you don't understand something or you think we might be able to do it differently, you better speak up because we want your opinion and we'll take that, everybody takes that into consideration. It's not like, does the decision go all the way up to this executive? And it's like, no, it's done more at the team. >> The cultural contrast between that and your parent, IBM, couldn't be more dramatic. And we talked earlier with Paul Cormier about has IBM really walked the walk when it comes to leaving Red Hat alone. Naturally he said, "Yes." Well what's your perspective. >> Yeah, are there some big blue people across the street or something I heard that did this event, but look, do we interact with IBM? Of course. One of the reasons that IBM and IBM Services, both products and services should be able to help get us breadth in the marketplace. There are times that we go arm and arm into customer meetings and there are times that customers tell us, "I like Red Hat, I don't like IBM." And there's other ones that have been like, "Well, I'm a long time IBM, I'm not sure about Red Hat." And we have to be able to meet all of those customers where they are. But from my standpoint, I've got a Red Hat badge, I've got a Red Hat email, I've got Red Hat benefits. So we are fiercely independent. And you know, Paul, we've done blogs and there's lots of articles been written is, Red Hat will stay Red Hat. I didn't happen to catch Arvin I know was on CNBC today and talking at their event, but I'm sure Red Hat got mentioned, but... >> Well, he talks about Red Hat all time. >> But in his call he's talking backwards. >> It's interesting that he's not here, greeting this audience, right? It's again, almost by design, right? >> But maybe that's supposed to be... >> Hundreds of yards away. >> And one of the questions being in the cloud group is I'm not out pitching IBM Cloud, you know? If a customer comes to me and asks about, we have a deep partnership and IBM will be happy to tell you about our integrations, as opposed to, I'm happy to go into a deep discussion of what we're doing with Google, Amazon, and Microsoft. So that's how we do it. It's very different Dave, from you and I watch really closely the VMware-EMC, VMware-Dell, and how that relationship. This one is different. We are owned by IBM, but we mostly, it does IBM fund initiatives and have certain strategic things that are done, absolutely. But we maintain Red Hat. >> But there are similarities. I mean, VMware crowd didn't want to talk about EMC, but they had to, they were kind of forced to. Whereas, you're not being forced to. >> And then once Dell came in there, it was joint product development. >> I always thought a spin in. Would've been the more effective, of course, Michael Dell and Egon wouldn't have gotten their $40 billion out. But I think a spin in was more natural based on where they were going. And it would've been, I think, a more dominant position in the marketplace. They would've had more software, but again, financially it wouldn't have made as much sense, but that whole dynamic is different. I mean, but people said they were going to look at VMware as a model and it's been largely different because remember, VMware of course was a separate company, now is a fully separate company. Red Hat was integrated, we thought, okay, are they going to get blue washed? We're watching and watching, and watching, you had said, well, if the Red Hat culture isn't permeating IBM, then it's a failure. And I don't know if that's happening, but it's definitely... >> I think a long time for that. >> It's definitely been preserved. >> I mean, Dave, I know I read one article at the beginning of the year is, can Arvin make IBM, Microsoft Junior? Follow the same turnaround that Satya Nadella drove over there. IBM I think making some progress, I mean, I read and watch what you and the team are all writing about it. And I'll withhold judgment on IBM. Obviously, there's certain financial things that we'd love to see IBM succeed. We worry about our business. We do our thing and IBM shares our results and they've been solid, so. >> Microsoft had such massive cash flow that even bomber couldn't screw it up. Well, I mean, this is true, right? I mean, you think about how were relevant Microsoft was in the conversation during his tenure and yet they never got really... They maintained a position so that when the Nadella came in, they were able to reascend and now are becoming that dominant player. I mean, IBM just doesn't have that cash flow and that luxury, but I mean, if he pulls it off, he'll be the CEO of the decade. >> You mentioned partners earlier, big concern when the acquisition was first announced, was that the Dells and the HP's and the such wouldn't want to work with Red Hat anymore, you've sort of been here through that transition. Is that an issue? >> Not that I've seen, no. I mean, the hardware suppliers, the ISVs, the GSIs are all very important. It was great to see, I think you had Accenture on theCUBE today, obviously very important partner as we go to the cloud. IBM's another important partner, not only for IBM Cloud, but IBM Services, deep partnership with Azure and AWS. So those partners and from a technology standpoint, the cloud native ecosystem, we talked about, it's not just a Red Hat product. I constantly have to talk about, look, we have a lot of pieces, but your developers are going to have other tools that they're going to use and the security space. There is no such thing as a silver bullet. So I've been having some great conversations here already this week with some of our partners that are helping us to round out that whole solution, help our customers because it has to be, it's an ecosystem. And we're one of the drivers to help that move forward. >> Well, I mean, we were at Dell Tech World last week, and there's a lot of talk about DevSecOps and DevOps and Dell being more developer friendly. Obviously they got a long way to go, but you can't have that take that posture and not have a relationship with Red Hat. If all you got is Pivotal and VMware, and Tansu >> I was thrilled to hear the OpenShift mention in the keynote when they talked about what they were doing. >> How could you not, how could you have any credibility if you're just like, Oh, Pivotal, Pivotal, Pivotal, Tansu, Tansu. Tansu is doing its thing. And they smart strategy. >> VMware is also a partner of ours, but that we would hope that with VMware being independent, that does open the door for us to do more with them. >> Yeah, because you guys have had a weird relationship with them, under ownership of EMC and then Dell, right? And then the whole IBM thing. But it's just a different world now. Ecosystems are forming and reforming, and Dell's building out its own cloud and it's got to have... Look at Amazon, I wrote about this. I said, "Can you envision the day where Dell actually offers competitive products in its suite, in its service offering?" I mean, it's hard to see, they're not there yet. They're not even close. And they have this high say/do ratio, or really it's a low say/do, they say high say/do, but look at what they did with Nutanix. You look over- (chuckles) would tell if it's the Cisco relationship. So it's got to get better at that. And it will, I really do believe. That's new thinking and same thing with HPE. And, I don't know about Lenovo that not as much of an ecosystem play, but certainly Dell and HPE. >> Absolutely. Michael Dell would always love to poke at HPE and HP really went very far down the path of their own products. They went away from their services organization that used to be more like IBM, that would offer lots of different offerings and very much, it was HP Invent. Well, if we didn't invent it, you're not getting it from us. So Dell, we'll see, as you said, the ecosystems are definitely forming, converging and going in lots of different directions. >> But your position is, Hey, we're here, we're here to help. >> Yeah, we're here. We have customers, one of the best proof points I have is the solution that we have with Amazon. Amazon doesn't do the engineering work to make us a native offering if they didn't have the customer demand because Amazon's driven off of data. So they came to us, they worked with us. It's a lot of work to be able to make that happen, but you want to make it frictionless for customers so that they can adopt that. That's a long path. >> All right, so evening event, there's a customer event this evening upstairs in the lobby. Microsoft is having a little shin dig, and then serves a lot of customer dinners going on. So Stu, we'll see you out there tonight. >> All right, thanks you. >> Were watching a brewing somewhere. >> Keynotes tomorrow, a lot of good sessions and enablement, and yeah, it's great to be in person to be able to bump some people, meet some people and, Hey, I'm still a year and a half in still meeting a lot of my peers in person for the first time. >> Yeah, and that's kind of weird, isn't it? Imagine. And then we kick off tomorrow at 10:00 AM. Actually, Stephanie Chiras is coming on. There she is in the background. She's always a great guest and maybe do a little kickoff and have some fun tomorrow. So this is Dave Vellante for Stu Miniman, Paul Gillin, who's my co-host. You're watching theCUBEs coverage of Red Hat Summit 2022. We'll see you tomorrow. (bright music)

>>The cube presents, Dell technologies world brought to you by Dell. >>Welcome back to the cube. Lisa Martin and Dave Vale are live in Las Vegas. We are covering our third day of covering Dell technologies world 2022. The first live in-person event since 2019. It's been great to be here. We've had a lot of great conversations about all the announcements that Dell has made in the last couple of days. And we're gonna unpack a little bit more of that. Now. One of our alumni is back with us. Shannon champion joins us again, vice president product marketing at Dell technologies, and she's a company by Pete Robinson, the director of infrastructure engineering at Salesforce. Welcome. Thank >>You. >>So Shannon, you had a big announcement yesterday. I run a lot of new software innovations. Did >>You hear about that? I heard a little something >>About that. Unpack that for us. >>Yeah. Awesome. Yeah, it's so exciting to be here in person and have such a big moment across our storage portfolio, to see that on the big stage, the boom to announce major updates across power store, PowerMax and power flex all together, just a ton of innovation across the storage portfolio. And you probably also heard a ton of focus on our software driven innovation across those products, because our goal is really to deliver a continuously modern storage experience. That's what our customers are asking us for that cloud experience. Let's take the most Val get the most value from data no matter where it lives. That's on premises in the public clouds or at the edge. And that's what we, uh, unveil. That's what we're releasing. And that's what we're excited to talk about. >>Now, Pete, you, Salesforce is a long time Dell customer, but you're also its largest PowerMax customer. The biggest in the world. Tell us a little bit about what you guys are doing with PowerMax and your experience. >>Yeah, so, um, for Salesforce, trust is our number one value and that carries over into the infrastructure that we develop, we test and, and we roll out and Parex has been a key part of that. Um, we really like the, um, the technology in terms of availability, reliability, um, performance. And it, it has allowed us to, you know, continue to grow our customers, uh, continue needs for more and more data. >>So what was kind of eye popping to me was the emphasis on security. Not that you've not always emphasized security, but maybe Shannon, you could do a rundown of, yeah. Maybe not all the features, but give us the high level. And at Pete, I, I wonder how I, if you could comment on how, how you think about that as a practitioner, but please give us that. >>Sure. Yeah. So, you know, PowerMax has been leading for, uh, a long time in its space and we're continuing to lean into that and continue to lead in that space. And we're proud to say PowerMax is the world's most secure mission, critical storage platform. And the reason we can say that is because it really is designed for comprehensive cyber resiliency. It's designed with a zero trust security architecture. And in this particular release, there's 19 different security features really embedded in there. So I'm not gonna unpack all 19, but a couple, um, examples, right? So multifactor authentication also continuous ransomware anomaly detection, a leveraging cloud IQ, which is, uh, huge. Um, and last but not least, um, we have the industry's most granular cyber recovery at scale PowerMax can do up to 65 million imutable snapshots per array. So just, uh, and that's 30 times more than our next nearest competitor. So, you know, really when you're talking about recovery point objectives, power max can't be beat. >>So what does that mean to you, Pete? >>Uh, well, it's it's same thing that I was mentioning earlier about that's a trust factor. Uh, security is a big, a big part of that. You know, Salesforce invests heavily into the securing our customer data because it really is the, the core foundation of our success and our customers trust us with their data. And if we, if we were to fail at that, you know, we would lose that trust. And that's simply not, it's not an option. >>Let's talk about that trust for a minute. We know we've heard a lot about trust this week from Michael Dell. Talk to us about trust, your trust, Salesforce's trust and Dell technologies. You've been using them a long time, but cultural alignment yeah. Seems to be pretty spot on. >>I, I would agree. Um, you know, both companies have a customer first mentality, uh, you know, we, we succeed if the customer succeeds and we see that going back and forth in that partnership. So Dell is successful when Salesforce is successful and vice versa. So, um, when we've it's and it goes beyond just the initial, you know, the initial purchase of, of hardware or software, you know, how you operate it, how you manage it, um, how you continue to develop together. You know, our, you know, we work closely with the Dell engineering teams and we've, we've worked closely in development of the new, new PowerMax lines to where it's actually able to help us build our, our business. And, and again, you know, continue to help Dell in the process. So you've >>Got visibility on the new, a lot of these new features you're playing around with them. What I, I, I obviously started with security cuz that's on top of everybody's mind, but what are the things are important to you as a customer? And how do these features the new features kind of map into that? Maybe you could talk about your experience with the, I think you're in beta, maybe with these features. Maybe you could talk about that. >>Yeah. Um, probably the, the biggest thing that we're seeing right now, other than OB the obvious enhancements in hardware, which, which we love, uh, you know, better performance, better scalability, better, and a better density. Um, but also the, some of the software functionality that Dells starting to roll out, you know, we've, we've, we've uh, implemented cloud IQ for all of our PowerMax systems and it's the same thing. We continue to, um, find features that we would like. And we've actually, you know, worked closely with the cloud IQ team. And within a matter of weeks or months, those features are popping up in cloud IQ that we can then continue to, to develop and, and use. >>Yeah. I think trust goes both ways in our partnership, right? So, you know, Salesforce can trust Dell to deliver the, you know, the products they need to deliver their business outcomes, but we also have a relationship to where we can trust that Salesforce is gonna really help us develop the next generation product that's gonna, you know, really deliver the most value. Yeah. >>Can you share some business outcomes that you've achieved so far leveraging power max and how it's really enabled, maybe it's your organization's productivity perspective, but what are some of those outcomes that you've achieved so far? >>Um, there there's so many to, to, to choose from, but I would say the, probably the biggest thing that we've seen is a as we roll out new infrastructure, we have various generations that we deploy. Um, when we went to the new PowerMax, um, initially we were concerned about whether our storage infrastructure could keep up with the new compute, uh, systems that we were rolling out. And when we went through and began testing it, we came to realize that the, the performance improvements alone, that we were seeing were able to keep up with the compute demand, making that transition from the older VMAX platforms to the PMAX practically seamless and able to just deploy the new SKUs as, as they came out. >>Talk about the portfolio that you apply to PowerMax. I mean, it's the highest of the highest end mission critical the toughest workloads in the planet. Salesforce has made a lot of acquisitions. Yeah. Um, do you throw everything at PowerMax? Are you, are you selective? What's your strategy there? So >>It's, it's selective. In other words that there's no square peg that meets every need, um, you know, acquisitions take some time to, to ingest, um, you know, some run into cloud, some run in first, in, in first party. Um, but so we, we try to take a very, very intentional approach to where we deploy that technology. >>So 10 years ago, someone in your position, or maybe someone who works for you was probably do spent a lot of time managing lawns and tuning performance. And how has that changed? >>We don't do that. <laugh> we? >>We can, right. So what do you do with right. Talk, talk more double click on that. So how talk about how that transition occurred from really non-productive activities, managing storage boxes. Yeah. And, and where you are today, what are you doing with those resources? >>It, it, it all comes outta automation. Like, you know, the, you know, hardware is hardware to a point, um, but you reach a point where the, the manageability scale just goes exponential and, and we're way, well past that. And the only way we've been able to meet that, meet that need is to, to automate and really develop our operations, to be able to not just manage at a lung level or even at the system level, but manage at the data center level at the geographical, you know, location level and then being able to, to manage from there. >>Okay. Really stupid question. But I'm gonna ask it cause I wanna hear your answer. True. Why can't you just take a software defined storage platform and just run everything on that? Why do you need all these different platforms and why do you gotta spend all this money on PowerMax? Why, why can't you just do >>That? That's the million dollar question. Uh, I, I ask that all the time. <laugh>, um, I think software defined is it's on its way. Um, it's come a long way just in the last decade. Yeah. Um, but in terms of supporting what I consider mission critical, large scale, uh, applications, it's, it's not, it's just simply not on par just yet with what we do with PowerMax, for example. >>And that's exactly how we position it in our portfolio. Right? So PowerMax runs on 95% of the fortune 100 companies, top 20 healthcare companies, top 10 financial services companies in the world. So it's really mission critical high end has all of the enterprise level features and capabilities to really have that availability. That's so important to a lot of companies like Salesforce and, and Pete's right, you know, software define is on its way and it provides a lot of agility there. But at the end of the day for mission critical storage, it's all about PowerMax. >>I wonder if we're ever gonna get to, I mean, you, you, you, it was interesting answer cuz you kind of, I inferred from your that you're hopeful and even optimistic that someday will get to parody. But I wonder because you can't be just close enough. It's almost, you have to be. >>I think, I think the key answer to that is it's it's the software flying gets you halfway there. The other side of the coin is the application ecosystem has to change to be able to solve that other, other side of it. Cuz if you simply simply take an application that runs on a PowerMax and try to run it, just forklift it over to a software defined. You're not gonna have very much luck. >>Recovery has to be moved up to stack >>Operations recovery, the whole, whole whole works. >>Jenny, can you comment on how customers like Salesforce? Like what's your process for involving them in testing in roadmap and in that direction, strategic direction that you guys are going? Great >>Question. Sure. Yeah. So, you know, customer feedback is huge. You've heard it. I'm sure this is not new right product development and engineering. We love to hear from our customers. And there's multiple ways you heard about beta testing, which we're really fortunate that Salesforce can help us provide that feedback for our new releases. But we have user groups, we have forums. We, we hear directly from our sales teams, our, you know, our customers, aren't shy, they're willing to give us their feedback. And at the end of the day, we take that feedback and make sure that we're prioritizing the right things in our product management and engineering teams so that we're delivering the things that matter. Most first, >>We've heard a lot of that this week. So I would agree guys, thank you so much for joining Dave and me talking about Salesforce. What you doing with PowerMax? All the stuff that you announced yesterday, alone. Hopefully you get to go home and get a little bit of rest. >>Yes. >>I'm sure that there's, there's never a dull moment. Never. Can't wait guys. Great to have you. >>Thank you. You guys, >>For our guests on Dave Volante, I'm Lisa Martin and you're watching the queue. We are live day three of our coverage of Dell technologies world 2022, Dave and I will be right back with our final guest of the show.

>>The cube presents, Dell technologies world brought to you by Dell. >>Welcome back to Dell tech world 2022. This is the cube alive. My name is Dave Volante. We're here with our wall to wall coverage. This is day two. We actually started last night. Uh, the, the cube after dark John furry is here. Lisa Martin, Dave Nicholson. We're gonna talk about apex. The business value of apex flex on demand. Darren fedora is here. He's the senior vice president of Dell financial services, and we're joined by a customer and a partner Jud Barron is R and D infrastructure architect at Silicon labs. And Steve end is the regional VP of copy center comp computer center. I say that like I'm from Boston guys. Welcome to the queue. >>Thank you, >>Darren, take us through what's going on with, with apex, you got custom solutions, you know, people are gonna ask, is this just a financial gimick? What is this? >>No gimmicks, no gimmicks, Dave. So I think when we think about technology, historically customers purchased, they bought and they owned and they may have financed it and paid over time, but it was really an ownership model, especially in infrastructure and apex is about subscription. So think about Dell apex, as you can either buy, or you can subscribe to your technology and under apex subscription, we have options for custom based solutions or an outcome base. And I know today we're gonna talk about flex on demand and, and custom based solutions. So it's a high level pay for what you use when you use it with a high level of choice and flexibility. All >>Right, Steve, I'm gonna ask you to play little >>Co-host all right. I like >>This. Okay. So add some color color commentary, Jud, tell us a little bit about, uh, Silicon labs. I'm really interested in what your requirements were, your challenges and kinda why you landed on, on apex. Sure. >>Uh, Silicon labs is a semiconductor company were headquartered in Austin, 10 Xs, uh, just under a billion dollars a year right now. And, uh, at any ed shop or, uh, that, that people who are doing electronic design automation, that's not just in the semiconductor industry, but we have these HPC farms who are running, you know, millions of jobs a day. And the, a balance that you have to strike when you're doing capacity planning in one of these environments is we have these things called tape outs, and that's where we're finishing a project and there's a much higher volume of jobs that we have to run and you have to decide, do we buy for peak or do we, you know, come under that some amount and say, oh, we're gonna buy 80% of what we think >>As an over, over, over under, right. Do we over buy for peak normally, right, correct. Right >>Hard. One is geo Overy the under buy. It's always a hard decision. >>There's a tradeoff. Right? And, and so the, the challenge there is that you'll end up kind of linking the time and potentially miss a tape out window. And there's costs associated with that because you work with the Foundry and you kind of schedule based off that tape out when you're gonna deliver the photo mask to them. So anyway, the point is we in the past using a traditional like camp X, we're gonna buy a bunch of servers. We, we tend to undershoot whatever our peaks are. Cause we may have a peak every couple of months during, you know, these tape outs. Uh, but you know, sometimes tape outs, slip. And so one slips two months, another one comes in a little bit early and now you have multiple tape outs in the same months. And what was gonna be a, a small, uh, difference in from peak to what you actually purchased ends up being a big peak. And, uh, the thing that was interesting to us about flex on demand is the ability to have a commit rate that, you know, the customer can work with Dell financial services to figure out is that 80% is at 60% whatever. And they give us additional servers that we pay just when we're using them. Now I'm somewhat oversimplifying the process. Um, but we're, we gotta talk about that, >>But, but the point is, if I understand it correctly, that infrastructure was dominoing the, the time to tape out in a negative way, and you you've been able to address that more cost effectively. >>It, it can, it, it has on occasion. And so this, this basically gives us a way to lever to pull, to say, well, we can spend some additional OPEX this month and open up this additional capacity. So it's not like bursting to the cloud. Exactly. Uh, because I mean, you have to have the equipment in your data center already for you to be able to use it. But, um, it's under a traditional acquisition model. It's, it's just not a, a, a thing that was available to us before and looking at leasing or other types of, uh, you know, financing was wasn't really attractive previously, but the flex on demand model, when we first heard about it, we're like, that's very interesting. Tell me more. And we ended up using it in, in Austin, and then we built a whole data center in Asia and did the whole thing on flex on demand and >>Got it. Okay, Steve, uh, talk a little bit about your role what's going on at, at computer center and you know, why apex give us the background? Yeah. >>Um, computer center is a, one of the largest global VAs on the planet, right? Um, we, we have a lot of global and international reach, but at the end of the day, it's about one on one customer of relationships. Um, talking to them, understanding what their challenges are. And we've had a multiyear relationship with Jud. I've known you for a long time. And, and, um, typically that relationship, or initially that relationship was about collaborating, working hand in hand, kind of figure out what the solutions were that best fit their environment to solve their issues they need. And it was typically a procurement, a, a purchase based relationship and, and it worked well for a long time, but it, when Jud posed the challenge to us about kind of more pay as you go, uh, uh, subscription based modeling for, for how he want to do acquire in the future. >>Um, we just, we huddle with the Dell team collectively, um, and, and talked about what we could offer and how we could solve the problem. Uh, apex is a really nice brand today, but this was two and a half years ago, Uhhuh. Okay. So it was a little, we were a little early on on putting it together. I feel good that we were able to, to put that type of solution together for Jud and it's, and it's working today, working wonderful today. And it was good for it's good for the whenever it's good for the customer, the manufacturer and the partner altogether. It's a wonderful solution. >>So you took a little risk, but it worked out and you helped. >>Yeah, that was probably the infancy as we were growing our, as a service, think of this, you know, there's a, a lot of big words out there, Dave, right? As a service utility cloud, it doesn't matter what it is super cloud it's super cloud. It doesn't really matter. Super. This is really Jud was talking about a really important element, which is around flexibility choice. There's uncertainty oftentimes in a, in an environment, but they want to control. They still want have a level of control and leveraging partnerships, being able to deliver flexibility and choice. Don't worry about the words. Don't worry about cloud utility as a service we end up solving the customer need, right? And when we talk about flex on demand, I'll give you a little bit deeper into flex on demand. So when we think about flex on demand, it really is about understanding the customer needs and our capability and Jed reference this, determining what a baseline is. So if you think about your own utility bill, right, you, you go home and even if you're on vacation for a month, I'm sure you went on vacation for a month right. Month at a time. If I ever. >>Yeah, >>I know, but if you leave you your utility bill, even if you don't turn on a light, you still get a utility bill, it's your baseline. So we, we determine a baseline with our customers, with computer center, to understand in your environment, you're gonna use this minimum amount and that becomes your baseline. And that baseline can go as low as 25%. And up to 80% in a environment, it usually is typically in this 70, 80%. And then we determine what is gonna be optimal based on that 25 or above we charge based on the usage on a day to day basis, average by a month. And if you go up one month during your peak, you get charged at that peak. If you then a couple months are lower, then you're gonna pay only for the usage. And so for a customer that's growing has variability or seasonality. >>Um, this is a great model cuz they can still control their environment either within their own domain or um, in a colo. They also have the capability to pick anything within the Dell ISG catalog, any product, configure it to meet their environment, be able to work with a trusted partner like computer center. That it's a solution based on a partner relationship and delivers choice and flexibility on the catalog of anything Dell sells within your control of how you can configure it. So it gives this ability to say, instead of buying and instead of paying a predictable payment, a I E a financing I'm gonna pay for use. Yeah. If I turn on my light switch more or if it's during the summer in Texas where I am the ACS a lot higher. So your utilities go up and if you are a much lower because you're on vacation in Hawaii, maybe you've been in vacation in Hawaii for a month, you're gonna have a much lower and you're gonna hit your baseline. Right. So it gives flexibility choice and it gives the control back to the customer. >>Okay. So the whole ISD portfolio. So you're like the tip of the spear for future apex, right? >>We, we, we absolutely are the tip and that's why, you know, Steve referenced a couple years ago as we were still in our infancy, growing, listening to our customers, listening to our partners, we've evolved to become a more robust program, um, 35 countries today. So we can cover 35 countries over the globe, all ISG you products that are sold with a high level of flexibility and it, and it's Jud and feedback over time that we've continued to evolve this program. Mm-hmm >>So Jud you, if I understood correctly, the business impact to you was gonna better predict predictability. You didn't have to over buy or undery and take all that risk. Is that right? You maybe could quantify. Did you ever quantify that? What can you tell us about the, the business impact? Yeah, >>Sure. So, I mean, traditionally we will, uh, base our capacity demands on, uh, complex calculation that effectively just boils down to number of engineers, like head count, uh, and you know, kind of personas within that. And we figure out, okay, well how many compute do we need? And then we say, okay, well how many tape outs are we doing? And when are those tape outs gonna land? And try to figure out which months are gonna be the hot months and the design teams have to kind of vary their tape out schedules so that they don't pile up all into like July or something. And then there's not enough compute capacity. So with, with something like flex on and where I can turn additional capacity on in our HBC farm, it, you know, we just go in and make some changes to the LSF configuration and say, Hey, you know, now you've got these extra nodes available. >>We don't really have to worry about that as much. Uh, in fact, last year we, we ended up with one month where for us, it was unusual. We had five tape outs, uh, at all land within two weeks of one and a other. And they all finished, which in previous years before we had deployed that that would not have been the outcome things we would've had multiple, uh, tape outs delayed. And you know, that that's a seven figure impact for each one of those commits that we miss with the foundries. So it it's a big deal. >>Yeah. That's real dollars. And >>It is. And you know what else, this, as, as Joe's going through this, we all know their supply chain chain constraints, right? And this solves a lot of supply constraints because Joe, if you would be purchasing today, you'd be buying, you're looking at had, and you're actually having to purchase today where if you go into an apex flex on demand, you don't have that full commitment of having to purchase, but you can get ahead of the supply chain. So you can be looking six months in advance, you can be doing capacity planning and I'm Jed. I'm sure you're doing that leveraging. Like what's my future and not be worried about, I have this huge burden upfront. >>Yeah. And I mean, we have two levers right now. One is we have this extra capacity there. I can, you know, pick up the phone and, and call our Dell rep and say, Hey, I'm gonna modify my commit rate. And so now that's, you know, the new baseline I can use all day every day. Uh, and, and, you know, we still have some burstability and then separately, we can say, we want to expand the contract or, or, or, you know, basically acquire more hardware for additional burst or additional commit. Both of those things are, are options. We only had the, we had to go buy it and we need to know when we have to have it available. So you kind of back into this ordering schedule for, uh, you know, like a traditional CapEx purchase. >>So Steve, obviously Silicon labs is, is leaning again. Are you seeing any other patterns in your customer base, uh, where this is being applied? What can you share >>With us there? Yeah, it's it, I believe this is a fairly horizontal solution. Any customer can really utilize it. I mean, traditionally people would buy for two and three years worth of capacity and slowly consume it over time, but you paid up front. Right. That's how it, that's kind of how it worked. Cause I didn't want to go back to the well year after year after year. Right. So, um, you know, and I, and I think, I think if anything, the, the, the cloud, the hyperscalers has, uh, taught the world, some things taught the industry. Some things, you know, in a, in a perfect world customers like to consume and pay for what they use, you know, and in the increments that they use it as much as possible as closely aligned to that as they could get. And what I see, what I see in this, you know, cuz I, I kind of put solu in my role, I'm putting solutions and customers and bringing those together other right. And, and complimenting that with services of our own. Right. But, but what I see over time that, that almost all the manufacturers and Dells does a wonderful job, but almost all the manufacturers will be delivering technology on a subscription basis. So the more I learn, the more I know, the more I understand about how to deliver those and provide those to customers is better off we are >>Because it aligns with business value. And that's what you're seeing Jud correct. >>Steve made an interesting comment in there. Uh, you know, he was talking about the cloud and for us, there's always pressure to say, Hey, you know, can we burst in the cloud? And for Edda workloads, every time we look at this, it's a data problem. It, it, it's not a computing problem for us. EA workloads tend to generate a lot of data and you know, there's a, there are a lot of tools, uh, you know, there's just a bunch of stuff that you have to have available to run those jobs. And so you have to look at that very carefully. The company that I work for Silicon labs has been around for a long time and we have a lot of development effort. That's been put into automating and simplifying things for our design engineering and trying to, you know, manipulate that and make it to where we can burst just certain jobs out to the cloud efficiently and cost effectively. Hasn't really resonated for us. But the flex on demand thing gave a us the ability to kind of achieve some of that burst ability. I mean, not to the same level of scale of course, but you know, we, we can do that at, you know, our own speed in our own data centers with our own data. And we don't have to worry about trying to, you know, peel an onion and put something new together, make it cloud friendly. It's >>Substantially similar. We gotta go. But to Aaron bring us home. >>Yeah. Hey, I think when we think about Dell, it's about listening to our customers and our partners. Mm-hmm <affirmative>, which we continue to do. We continue to evolve our products and, and apex is around choice and flexibility in delivering to customers an option to pay for what they use. It's a great solution. Appreciate the time guys. >>Great conversation. Thanks so much for coming on the cube. All right. Thank you. Good luck. All right. And thank you for watching. This is Dave VoLTE for the cube. We've been back with more wall to wall coverage. John furry, you'll be back Lisa Martin and Dave Nicholson. You're watching the queue >>And.

>>Welcome to the cubes coverage of Dell tech world 2022. My name is Dave Volante and I'm currently in our studios outside of Boston. As we prepare to gather for the first in person Dell technologies world since 20 19, 1 of the major structural change and the technology business during the pandemic was IBM's spin out of Kendra. A world class technology services provider that lived inside of IBM. Kendra is a large business with trailing 12 month revenues north of 18 billion. It's got 90,000 employees worldwide. Kendra has long term predictable cash flows. And in my view is one of the most undervalued companies in the technology sector. As a separate company, Kendra is able to turn many of its former internal IBM roadblocks into tailwinds and ecosystem. Partnerships are one of the best examples of new opportunities that are opening up for the newly separate at company. In this next segment, we're gonna dig into a new partnership between Kendra and Dell technologies and what is the most critical priority for organizations today? Cyber resiliency and with me are two really impressive and talented guests. Chris Lovejoy is global security and resiliency practice leader at Kendra. Michelle Weston is vice president of, of global offerings for security and resiliency also at kindred ladies. Welcome to the cube. Thanks for coming on and spending some time with us. >>Thank thank you. >>Okay. Let's zoom out a little bit and start with a big picture. What would you say are, are the one or two major trends or changes even in cyber that you've seen since the pandemic, maybe Chris, you could start us off and Michelle, you can chime in. >>Sure. Happy to. And, um, you know, I think part of this actually preceded the pandemic and, um, you know, the fact is, you know, a lot of organizations have been engaging in the adoption of new technologies, you know, be it cloud AI IOT, what, what, whatever that may be. Um, and they've been introducing that technology without, um, adequate security control and during the COVID pandemic, um, when, you know, technology transformation happened for existential reasons, what we were seeing is organizations throwing at even more technology at cyclic, right, with absolutely no security control whatsoever. And in the meantime, the regulators who are, you know, watching this in, you know, horror are introducing new requirements in and around, um, what we're calling cyber resilience today. And it's all based on this concept that, you know, conventional cybersecurity assume that the adversaries could be kept out of organizations. >>Um, you could protect the organization and sort of block it, um, as rising numbers of disruptive attacks, like, you know, ransomware attacks have shown those approaches don't work. And so, um, what we're seeing is that the market is really moving toward this concept of cyber resiliency, which goes beyond cybersecurity. It assumes that the advanced a adversaries are frankly, many adversaries can overcome, um, conventional protections and that, um, they, that organization need to prepare to recover. Um, so our approach, the approach that we're taking to the market is really to help organizations in binding security plus continuity plus disaster recovery, then giving them the ability to anticipate, protect, um, with stand and recovery from any adverse condition associated with their cyber real estate. Um, and this is why we're so excited to work with Dell, uh, because they're really, uh, paving the roads for us to actually, you know, work together in solving these needs for our clients. >>Got it. That makes sense. And now Michelle, as Chris was saying, these worlds are coming together. What used to be adjacencies, oftentimes they, after thoughts, bolted on, and now you've got the work from home and, and hybrid work, not to mention, as Chris was saying, you're injecting AI and all this data, you know, this is a complicated situation for a lot of people, isn't it? >>Yeah. And it was only even more complicated during, during the pandemic as well. I think, uh, another trend that we saw was the end enterprise was outside the enterprise, right? Uh, everyone was working from home. They weren't in the data centers, their own resiliency and security protocols were already at risk because they were so manual and people intensive. And yet we know, you know, the bad actors actually took advantage of, of that right. Uh, data centers were, uh, less monitored. Um, we had all of the employees working from home. Now, the enterprise is outside of the enterprise, but you still need security and resiliency for all of those endpoints. Right. And I think that's driving a higher need, um, coming out of the PA the pandemic and even with this hybrid model, okay. We'll return to work, but not, not in the same fashion that we did prior to the pandemic. >>That's the new reality. The other thing that I would say is that those customers that had adopted cloud already and cloud enabled their business, they were able to fare, um, the best during the pandemic. They were able to sustain their businesses. Um, alternatively, and it's kind of a different lens to it. I think the pandemic actually drove new ways of working and some really creative solutions. I mean, if you look at, um, you know, food delivery services that, uh, proliferated during the pandemic, or, uh, that are now offering fitness online, um, fitness classes online, people had to think, um, intelligently and, and creatively on how they sustain their businesses. So I think all of that's coming together, but certainly this need of, as you said, not thinking of security and resiliency as an afterthought, but as a forethought planning for those things efficiently and effectively, that we find customers that do that, uh, do it the best. And, uh, I think that Kendra offers a unique value pro in here because bringing both together is a journey that we started a couple of years ago that we've only accelerated with the, uh, spin of the Kendra company. >>Yeah. Interesting. So I wanted to talk about that partnership because mm-hmm, <affirmative>, you know, Dell's got this massive channel, it's got infrastructure technology expertise, uh, but Dell, you know, Dell's a product company, Kendra is a services company, so it's a really good match in that sense. Right. Uh, maybe you could talk about how the partnership came together and, you know, what are the critical aspects that folks need to be aware of? >>Yeah. I would say Dell's an excellent partner for us and they have been for a number of years. So in a lot of ways that's not new. Okay. Uh, we've been partnering in market together for quite quite some time. In fact, the solution that we'll talk about today was first put into market in 2018. And you're absolutely right. We, we come together in the best ways. They're leveraging our strengths with regard to manage services, professional services. And we are certainly looking at them as a key technology provider, um, for our portfolio, we've worked together for years. Uh, we manage backup environments based on their data protection solutions, including data domain, but what was unique. And I think we were both ahead of the market at the time, um, was the 2018 solution that we put in to market and have only enhanced and augmented it ever since it's, it's called, um, cyber volt is, is the solution from Dell technologies. >>We certainly manage that solution in market for them today. And then we have unique differentiation in our Kindra portfolio that we've integrated with that and add to, um, their cyber incident recovery features, um, Dell initially put the solution in market coming out of, um, some of the ransomware attacks that they had cyber attacks that they had. They realized there was a need to protect the large data domain install base around the world. Um, they developed some proprietary solar solution, uh, software on top of their large data domain boxes and, and any cyber incident recovery solution. You need a, a few things you need the ability to assure imutable storage, a, a copy that you can assure has not been altered so that when you initiate the recovery, you know that you've got a clean copy and you're not propagating whatever is there. Um, so the solution has that, um, it has the other component that you need, which is the ability to scan the data for anomalies, right? >>So they're scanning the backup files continuously to look for anomalies. And then lastly, you need some form of data mover, which the data domain, um, solution offers. So they came to us in 2018 and said, look, we've got this solution. We think we're ahead of the market. Uh, we were also investing in cyber incident recovery with a key asset that we acquired in market in 2015, um, that we've continued to bake cyber incident recovery features and functions into, and they said, let's marry the two. And let's have you provide all of the managed services capabilities around this for clients. Um, that is a key piece because when it comes to cyber, uh, there's always a level of confidence that customers have, right? Yes. I can recover from any adverse condition. If you ask them, can you recover from a cyber attack with a hundred percent assurance? I don't think there's a customer today that could say given how sophisticated and how much these, these attack vectors are changing, that, that they, they have that a hundred percent confidence level. So a managed service provider, a phone, a friend in the event of is a, is a unique value proposition. Um, and that's what the two companies are bringing together, uh, for customers today. >>Got it. Thank you. So, so Chris, maybe as a services company, you, you, you have to be ignite, you know, to technology, you know, the best fit, et cetera. But, but prior to the spin, we never would've heard it, something like this. And so what, maybe you could talk about the partnership from your perspective. >>Yeah, no, absolutely. And I, I do wanna, um, you know, sort of double click on this a little bit, you, and you mentioned it in your opening, you know, headwinds being wins now. And I think this is important, incredibly important. You know, what people don't realize about Kendra is that, you know, we were never able to, as the services organization, um, that was really focused on strategic outsourcing and providing other kinds of services to, uh, clients while under the IBM banner are really never able to talk about the technical depth that we had across any number of platforms, including, um, the hyperscalers. And we have thousands upon thousands of people with hyperscaler certifications. Um, we have experience with pretty much every security and resilience technology out there. Um, we have broad and early with organizations like yours, that we were never able to speak about now, you know, when it comes to a client, you know, let's be realistic. >>Everybody is engaged in some sort of it modernization program. And while, and we have to realize also that those it modernization programs, you know, oftentimes they have no destination per se. You know, we talk about them as a journey, but we, if no destination, they just keep going and going and going. And the directions change every day, depending on, you know, what the strategic, uh, requirements are from whatever C-suite, you have, you know, sitting at the table, uh, what the competitive trends are, what the market is telling you, et cetera. And so what clients are saying to us is that the value we offer is that we can untangle the mess. That is their environment. We can meet them where they are, we can get them where they wanna go. And so, you know, when it comes to a relationship with Dell, you know, we believe that, you know, particularly in the area of security, in resilience, that there is a unique proposition to be had around the services and the cross platform experience and certifications and skills that our, um, our teams have married with the technology advances that Dell has made in the, in, in the world, as well as our experience in, you know, sort of the two that has have been frankly, hidden over the past few years. >>I think we have some, uh, something unique that we can offer to the market. Particularly, as I said, in this space of security and resilience, where all of our clients are, you know, looking for some sort of solution to this, you know, gee, I can't spend enough money to protect myself. I need to make sure that if the worst happens that I can bring myself back again, that's what we can do for our clients. >>Great. Thank you, Michelle. I wanna go back to the solution for a moment. You mentioned a number of things, integrations. I got like a zillion questions here. I'm interested in what kind of integrations you talked about imutability where does, where does that occur? Is that in the cloud? Is that the, you know, Dell technology is scan for anomalies again, what is that? Is that some kind of, you know, AI magic, you got a high speed data mover. Is there an air gap involved, maybe help me fill in some of those gaps. >>Yeah. And I think you, I think you've netted out the solution. Any cyber incident recovery solution in my mind would have those three things. They have some form of imutable storage. Uh, this could be cloud object storage in the case of the Dell solution, they're actually using their retention lock feature on the large data domain devices. Right? So think of this solution as having two data domains, they both have this retention lock feature. That's the imutable storage. They're able to move data and forth between the two, uh, that's another key piece. And then finally, for any incident recovery solution, you need the ability to scan and make sure that there aren't anomalies, um, in this case, in the backup files. So they're using a, a third party to scan thatno scan those files for anomalies. And when when's detected, that kind of gives the indication that something may be there and then they can go in and triage it and, and, and clean the environment if needed. >>Um, so we certainly manage that end to end, and that is one approach. It is an on-premise approach. It uses the data domain, uh, technologies. We know that clients have a lot more than that, right? So where Kendra comes in with its cyber incident recovery solution that also integrates with Dell's cyber incident recovery solution is we support cloud, um, multiple infrastructure. We have also imutable storage that we leverage. Um, and then in terms of our anomaly scanning capabilities, in this case, we're using technology that we had originally developed in IBM research that we integrated into the software product. Um, again, this is on an acquisition we did in market five years ago, called son Nobi. It's a software product. Um, it ingests and automates all of your workflows in the, in, in the event of any failover failback, any, uh, outage, including cyber and that technology underpin a lot of what we do on the incident recovery perspective, Dells use data domain. >>We've used the software, all both solutions have all three components of the cyber incident recovery, uh, solution when they're integrated, there's real power there, right? Because now you're looking at protection, not just of the backup environ, um, but all environments, including production, you're looking at being able to scale beyond OnPrem. Um, and more importantly, you're looking at the speed to recover, right? The not needing to rehydrate the data, but to be able to recover with the RTOs and RPOs that are expected, um, of our customers on the resiliency orchestration side, the Kendra solution. Um, this is, this is push of a button fail over, fail back in the event of an outage. Um, you can recover the entire hybrid estate in the matter of minutes and what we know with respect to any outage it's costly. We know know that downtime is costly, but with respect to cyber, we know that that's more costly than a typical outage, sometimes four X, um, you don't always recover from the brand damage from the loss of customers. So being down and, and coming up as quickly as you can, with the additional data verification, data validation and assurance that you're not propagating, whatever is there is the value prop, um, that both CU, both companies are really serving. >>And where does an air gap fit in into this equation? Is that yet another layer of protection what's best practice there? >>Um, so think of the air gap is just between the data movement and the immune storage, right? You need to be able to cut connection in a way, right. That is an air gap solution. And it's based on the imutable storage that both have. >>Okay. And that would be, it could be local, I guess, but it also could be, it should be maybe remote. Yes. Mm-hmm >><affirmative> okay. Exactly. And, and the ability to manage and orchestrate that air gap is a key value prop again, of the Kendra solution. >>Okay. And so I've mentioned local or remote. I mean, obviously the trade off is recovery time, you know, uh, I guess RTO, um, but, but <laugh> and RPO. So a lot of layers is, is what I'm hearing is that's always security pros in this framework. >>Let me give you another example, the reason why this is so important. Um, most of our Dr. Processes today, they all rely on people, right? We had a large client that was impacted when we were IBM. They were impacted with pet. They had a great Dr plan. They were a customer of ours. Um, we managed that service for them. Their Dr. Plan was still people intensive. And when that attack happened, it took out the badge readers to the people that you've invested in. Can't get on site to manage the incident, can't bring up the environment. And then if you look at going back to the very beginning of our conversation, COVID being sort of, uh, another way that that happened with access and the ability to continuously monitor and have the people on site that ability was impacted. So this is where you need to invest in technology, uh, P and processes to make sure that you are as robust as you can be. And as Chris said, your ability to anticipate with stand and recover from any adverse condition, that's, that's the value prop that our global practice brings. Yeah. >>To your, to your point, the adversary is well funded and motivated. Chris, we'll give you the last word, where do, where do you wanna see this partnership go? You know, kinda what what's next? What should we look for in the coming months and in, in years? >>Yeah. I'm, you know, I think, you know, very simply, and I'm going put my CISO hat on right. For a minute, because I think it's important to speak, you know, for the customer as a customer, you know, at the end of the day, I, I think most C-suite executives do don't realize the extent to which security, continuity and disaster recovery have been separate silos. And what is shocking to our clients when they get into a ransomware event in particular is the fact that they have their, um, systems, their services, their data is locked up, their backups have been sort of implemented or have, have been, you know, sort of subverted. They call in the pros, they call in the folks that help them with the incident response. The incident responders are able to identify the ransomware strain. They're able to contain the ransomware strain, but the damage is done. >>Now, what, how do you bring the environment back? How do you that the data is good? How do you, how do you find the system configurations and load them again? In what order do you load them? What they don't realize is that security and recovery, they have to be merged together. And so what I think that we can do it, it's not just, you know, build customer demand is not just sell a solution. We can really help clients. And so my hope is that we are able to bring cyber resilience into every organization, every large enterprise out there that needs to, you know, continually service their clients and their employees. They need to stay in business that we're able to bring the solution to them in such a way that they're able to, you know, bring back their environments to serve their clients when the worst does happen. >>Great. Yes. Thank you. We're definitely seeing that data protection world and the cybersecurity world. They, they adjacencies, but they really are coming together and part of a comprehensive plan. Okay. We have to leave it there. Thanks so much folks for coming on the cube really appreciate your time and your insights. >>Thanks for having us. And >>Thank you. Thank you for watching the Cube's coverage of Dell technologies world 2022. Keep it right there. We're running all week with live coverage from the show floor. We're pumping in deep dives like this one throughout the week. So don't go away.

>>The cube presents, Dell technologies world brought to you by Dell. >>Hey everyone. Welcome back to the cubes coverage of day. One of Dell technologies world 2022. Live from the Venetian in Las Vegas. They're excited. I dunno if you heard that a group behind me, very excited to be here. Lisa Martin, Dave ante. We're very pleased to welcome Jules Johns SVP of channel from McQuin. Jill, welcome to the program. >>Thank you for having me. I appreciate it. >>And those people back there are very excited. If you heard that big applause >>That >>Went live <laugh> so the, the vibe here is fantastic for the first live Dell technologies world since 2019. A lot of people here, this expo hall is packed a lot of, of momentum here, but there's also a lot of momentum critics. Talk to us about what's going on. >>Well, and you know, so, so many exciting things for Equinex and, you know, in this partnership of Dell, it gives us a chance to, to share that, uh, with partners here throughout the conference. So we are very excited, as you said about, and we just, we named to the fortune 500 this year, 77 quarters of growth consecutively, but underpinning that is having made huge investments in what is the world's largest footprint of global data centers, 240 of them on six continent in 66 markets, but then interconnecting them. So they have the connections that Dell customers need to the clouds. They have the connections that they need to all of the future SaaS providers, so that foresight to put together that interconnection network across our footprint has set us on the path we're on today, which we're very grateful, um, to be at in. And, and really this, the things that are happening with Equinex and Dell together can, couldn't be more of the moment. >>Talk to me about that. The, the last two years, the moments of the last two years have been very challenging. They have for everyone. How has the partnership evolved in that time? >>Well, you know, we at together, Dell and Equinix, what we're doing is really helping, helping our shared interface, customers navigate the complexities of their digital transformation and, and digital transformation is hard and it's not a one and done, and it's not an overnight solution. And so what we are doing is partnering with Dell to think about putting a dedicated Dell it stack in an Equinex data center to give customers that sovereign adjacency so that they can have that security proximate to our, all the clouds and, and, and all, everything else. They need to participate in the ecosystem. And then pairing that with, you know, these interconnected enterprises. So Dell and we are helping customers then be able to have some of their solution on Preem some of their solution in the cloud access, public clouds, and use that collectively to diff fine. We're calling the intelligent edge together. And that intelligent edge means so many different things to customers, but it is really our honor to work together with Dell to help each customer define that for themselves. >>E's amazing company, like you said, it's, it's, you know, I didn't realize it was that many consecutive quarters, but it's a 60 billion plus market cap. If you look at the stock chart, blow your mind, really incredibly successful. And part of the reason it's funny, you know, 10, 15 years ago, people thought, well, oh, 10 years ago, anyway, the cloud is gonna hurt companies like equity. It was exact opposite it. And, and that's because, you know, Charles Phillips used to joke friends. Don't let friends build data centers. Yes. Right. And, and it's not a good use of capital for most companies, unless you're in the data center business. Now, of course you have some of your own as a service offerings. We do. What's the overlap with, with Dell? How do they compliment each other? It, >>It's a good question because, you know, and we get that, are you and Dell in fact competitors, and no, we see them as who complimentary. And in fact, we're working with Dell to bring to market things like something we call power edge, which involves their servers and power store, which involves their storage. And, and then V RIL, which is really the hyperconverged infrastructure. And those are just few first of a series of offerings we expect to bring to market with Dell. And if you think about metal and, and it's Equinex metal that people sometimes think is a competitor, but what metal does for customers is it really allows them to advance, have the equipment placed in our data centers so that they can access that capacity. And according to spikes or needs that they have that equipment in our data centers, that's there for them to avail themselves of that capacity is most often Dell equipment. So we are really doing and executing that bare metal is a service together. >>What are some of the, the things that you're hearing from, from your partner community, in terms of the partnership with Dell, what are partners supposed be excited, the momentum there what's going on in the partner community? >>So, you know, that is that's, that's what near and dear to my heart, since that's what I'm responsible for. Equinex is global partnerships, and they are very excited about what we're doing with Dell. And to be honest with you, all of our top partners are also top partners of Dell. So it makes that we bring it together. So, you know, big categories of partners like the world's largest global network service providers, some of whom are here and who will meet with the at T orange business services. Those folks, in addition to the world's largest global systems integrators, Kendra, Deloitte, Accenture, we pro, uh, all DXC. All of these are partners that Dell and we will meet with together to further our, what we call power three, that together we're better because as much as Dell and Equinex are delivering the customers, most often don't have the experience. They need to execute it without a partner. So they are relying on those partners to take what we are doing and make it their own. And so, so if they're excited about it, it is a, it's a big opportunity for them from a, a revenue services, a and an opportunity for them to step into a next level, trusted advisor status. So partners are excited and, and we're gonna be spending a lot of time with them the next few days. Do you >>See Equinix? You know, these cuz these partnerships are not bespoke partnerships, it's an ecosystem that's organic and evolving and, and growing. Can it be, are you a dot connector in a way, can it be a flywheel effect in your ecosystem? >>Well, I mean our, so our E ecosystems that, um, that we provide wide range of those from high frequency trading to connected cars, um, to the internet things, many and content providers that we are, we do see it as our role to, you know, the 10,000 and growing customers that are in our 240 data centers and six continents that provide those ecosystems. It's, it is our mission to continue to grow that and enrich it because that does differentiate us greatly from another data center provider. And it's the combination of the ecosystem that you find and the people you can connect to at Equinex, and then also the leverage of our fabric in order to be able to access your future needs. >>And it's a lot of technology underneath these, you know, it's that first layer one, I guess, if you will, of the data center, right. And so a lot of your, your customers or your cus your partner's customers, they just don't want to be in that business. As we were saying before, I mean, it's just too expensive. The, the power requirements are going through the roof, so you gotta be really good at managing power. >>You do. In fact, you know, so first of all, you're right, it's extremely difficult for them to also be able to make that kind of commitment, to keep a data center. They would ran, they would manage themselves at the level that Equinex is able to invest. So it's very difficult for people to do it themselves, but even show another, you mentioned actually about the power is near and dear to our hearts because is super committed to sustainability. And so we've made a commitment to holy renewable energy. And it's something that we talk a lot about how we also help partners like Dell meet their initiatives, so, or partners like at T meet their connected climate goals. So we, we are actually using that and coming together with Dell on that story, so that, and, and then helping to amplify that with our partners. And, >>And that's, that's how do you do that? That's putting data centers where you can cool with ambient air. Is it being near the Columbia river? How what's, what's your strategy in that regard, >>Uh, and sustainable. I have to be honest to you. I, uh, I would be out of my depth if I didn't say >>This is the high level. Yeah. >>So, um, we are deploying some of the latest technologies about that, and then experts people who, you know, who all they do is really help us to, um, to reduce the carbon footprint and be able to offset that, be able to use solar, be able to use wind, be able to take advantage of that. And then also to, um, to navigate what's available when you're in 240 locations on six cotton, it's not the same options to reduce your power consumption. And your burden are different in Africa, as you just discovered with our main one acquisition than they are in India, or then they are in, in other parts of the world. So it is for us a journey, and we've been assembling a lot of the talent to do that, but >>You're so large now, even a small percentage improvement can really move the needle. >>And I think because we are the largest, it is incumbent upon us to really set the standard and be committed to it. And, um, and we do see other people following, which is, is a good thing for all of us. Well, >>How important is that in your partnership conversations that partners have that same focus and commitment on ESG that Equinix has >>Partners care a lot about it, but, uh, customers ask us both all the time. I mean, we increasingly see a portion of an RFP or a scope of work asking before I decide to go with Equinex and Dell, tell me how you're going to impact the environment. Tell me about your commitment. And so, um, so we are committed to it, but customers are demanding it to >>Where >>Do you go ahead please? >>Oh, I was just gonna say, it's, it's coming from the, from the voice of a customer, which Equinox is listening to, we know Dell is listening to it as well. >>I'm so >>Sorry. One more time that, that the, the sustainability of the ESG demand is coming from the customers. You were saying, it, >>It both like, I mean, we wanna do the right thing and we've made commitments to it, but our customers are holding us accountable to it. And, you know, sustainability is now a board level priority. It is for us. And it is for companies like Dell and it is for partners and customers. >>It really is. It's it's, I mean, it's up there with security in terms of the board level conversation, where do you want to see the partner ecosystem in the, the, the next let's call it three to five years in your business? You can look out that far. >>Well, you know, I, I think that, um, they, our partners, um, and I, that, I mean, Dells and our mutual partners, you know, are, we've been listening to customers with Dell to deliver a flexible set of options for how customers would consume Equinex and Dell. So our partners are gonna be integrating a variety of those in order to meet the customer where they are in that journey, whether they wanna buy apex as a service, whether they wanna buy Equinex metal, whether they wanna have car some, uh, a partner put together, bespoke, do it yourself, combination with other services. Uh, I, I mean, the customers are going to demand a choice of options. I think partners are gonna embrace multiple versions of that so that they can, you know, to meet the customer where they are and take them >>Well, that's, that's incredibly important these days to meet customer where they are, the customers have a lot of choice. It is, but everything that we're all doing is for the customer, ultimately at the end of the day, <laugh> >>Yes, it, it, it, it is. And, and, you know, the customers are getting Savier, but we are all still early in this journey, as far as the edge, you know, I mean, I think we are all still, um, we're all still grappling at the, at for right now. We like to say that as customers are looking to define that the, the footprint that we offer together with Dell gives them an, an awfully robust set of choices for now. And then we wanna continue to invest and expand to be wherever they need us. >>Well, that's the thing about your business? It's it's optionality. I mean, you can't, I mean, the cloud has a lot of stuff, but you can't get everything you want in the cloud. You can, and you can put anything in your data center. That's, that's, you know, it, >>You can, but you may not know what you need yet. And so that's one of the things we spend a lot of time having our solutions, architects and our sales people together, but they'll talk about future proofing, their strategy. So future proofing, that combination of OnPrem and in an Equinex data center, and maybe some public and future proofing leveraging our fabric so that they might elect different SaaS space services or cloud based services a year to five years from now than the year, even thinking about today. And, and they may expand their edge over time, because they may, they may sort of see that as a, at the customer end point today, most businesses are still sort of using a footprint like ours as their edge, but that could change. And so we wanna be there when it does. >>Yeah. That's a great point because you don't wanna necessarily have to rip it out every cup of years. If you, if you, if you can have a, an architecture that can grow. Yeah, sure. You might want to upgrade it >>Well, and it's one, that's one of the most appealing things about services like metal, where they also, uh, they do sort of prevent that sort of rip and replace, but they also help people navigate the supply chain shortages that are going on right now. So this that's been, this has been a trying two years for supply chain shortages, and being able to take advantage of Dell equipment already staged at an Equinex data center and partners can then bring their customers a quicker immediate response. Have >>You also seen this? You mentioned the supply chain shortages, some of the many challenges that we've experienced in a last few years, how much of a factor has the great resignation been? The labor shortages, the cybersecurity skills gap on, on folks coming, Tolin saying help. We don't have the resources here to do this ourselves. >>We have been fortunate to, to not, to, to be, um, if you're asking about how the reservation has affected us as a company, no, >>Your customers >>Or customers that has oh, okay. Yes. So it is, it is a challenge for them, but it's an opportunity for our partners. So what I see there is it's been challenging for customers to hold onto that talent, but partners are filling that gap and we've access Aon fortunate to hold onto a lot of our best and brightest. And so we put them together with our partner and we try to help customers fill those gaps. >>Well, that's most important thing, filling those gaps. >>You, you ever been one in inside one of these ultra modern data centers? I have not, >>Not yet. >>It's pretty cool. Isn't it? I mean, >>Have you, have you ever had a tour of one? >>I I've never had a tour of an Equinix data center, but I've seen some modern data centers that will blow your mind. Well, >>I mean, they, they come with all the requisite, uh, bio and man traps and all of the bells and, and, and whistles that are actually the first slay of physical security. But then once you get into the data center, then we have sort, we get into the virtual and the digital security that you would expect. So it's, >>Yeah, it's good. And you know, it's not like you drive by the data center, it's a big sign. Here's the data center. It is kind of, you know, they're trying to stay a little hidden and then like, it's get in. It's like getting into fork knots. It's probably harder. And then, but then the it's, it's like this giant clean room, right? It's amazingly clean and just huge. >>There are all >>Your >>Mind. And inside this data centers, all the world's networks come together and peer, and then we have inside their, the, the most direct rom reps to the cloud. So you would expect there, there's a, there's a lot of wires and pipes running very neatly through a very secure, >>Clean systems and power system >>Environment. For sure. >>Amazing engineering. >>It is really >>A >>Tour. You should, you, if they do, you let people tour >>Your, I, I will bring both of you on a tour. Awesome. >>I, my guess >>Would love to. >>Yeah. Great. Sounds fantastic >>On that. So >>Last >>Couple, we'll bring a camera. <laugh> Oh, no, we're not allowed. Not today. >>No phones, no phones sequester. So what, what are some of the things that you're excited about seeing and hearing the next couple of days as this is the first time we've all gotten to be together in so long? >>So, um, well, you know, we are excited about the conversations that we're gonna have power of three that I was talking about. So, you know, we really pride ourselves on sort of having that combination add up to more, to benefit the customer. And so this will be sort of a coming out party of sorts for Equinex and Dell will meet with you almost 20 different global partners that are really important to both of us. So I am most excited about those conversations and about, uh, the education I'm gonna get on the ways they're thinking about integrating it differently, because that is good choice for the market. That is good choice for the customer set. So for the enterprises out there, so that I'm most excited about. Awesome. >>Sounds like tremendous opportunity, lots going on this week, but thank you for coming on, just talking An hour of Equinix and Dell better together, the way that your channel partner program is growing. And of course the momentum of the company will can't wait to see what happens next year. Thank >>You. Thank you. Well, we aim to deliver and thank you again for having us. Thanks, >>Jules. Our pleasure for Dave Volante. I'm Lisa Martin, and you're watching the cubes live coverage day one, Dell technologies world live from Las Vegas, stick around. We'll be right back with our next guest.

from the cube studios in palo alto in boston bringing you data driven insights from the cube and etr this is breaking analysis with dave vellante recent earnings reports from key enterprise software and infrastructure players underscore that tech spending remains robust in the post isolation economy especially for those companies that have figured out a cloud strategy now despite covert variant uncertainties and component shortages and hardware most leading tech names outperformed expectations this past week that said investors were not in the mood to reward all names and any variability in product mix or earnings outlook or other nuances were met with a tepid response from the street hello and welcome to this week's wikibon cube insights powered by etr in this breaking analysis we'll provide you with commentary and data points on key tech companies that announced this past week including snowflake salesforce workday splunk elastic palo alto networks vmware dell pure storage hp inc and netapp let's start by rolling back a week or so and look at how stocks that are priced to perfection get impacted by any negative news back on august 20th we saw this headline hit snowflake stock falls as analyst says signings growth has slowed the analyst report was put out by a boutique firm cleveland research the stock took a double-digit hit as you can see here i immediately got several texts from investors who know i follow the company asking me what i thought now as a disclaimer i don't give stock picking advice please do your own research but between the cube wikibon and etr we do see a lot of data and i'm happy to share that which i did with this tweet it said lots of talk ahead of snowflake's earnings some analysts have said their data suggests a slowdown etr data looks pretty encouraging and i tagged merv adrian he's a sharp analyst over at gartner who follows data and database he responded i don't speculate about revenues but there's no discernible shift in our client conversations though interest still seems high okay cool but let's let's dig into the etr data a bit and see why we remained positive this is a larger and more detailed version of the chart in the tweet it's a candlestick that shows a time series of the spending data on snowflake using etr's net score methodology the stacked bars represent the percent of customers in the survey that are newly adding the snowflake platform the forest green indicates the number of customers reporting that their spending is increasing by six percent or more the gray is flat spend that's plus or minus five percent the pinkish stack that's decreasing spend by six percent or more and the bright red is where chucking the platform we're leaving now you subtract the reds from the greens and that yields a net score which for snowflake last survey was a very elevated 81.3 percent we've highlighted the spending velocity line that's net score at the top put a picture of that blue line for snowflake in your mind because we're going to come back to it the yellow line down below is market share which is a measure of the pervasiveness in the survey i.e mention share if you will so looking at this chart one might conclude that the lime green i.e new account acquisition is compressing however in further analyzing the data back in january 2019 snowflake's presence in the survey was much lower only 35 accounts in subsequent quarters that number has jumped to over between 120 and 140 snowflake accounts so big much bigger n so while the percentage of respondents may be shrinking the absolute number of new accounts is growing on the snowflake earnings call snowflake said that new customers increased this past quarter to 458 up from 397 in the same period last year what's also telling is the forest green on its very first earnings call as a public company snowflake cfo mike scarpelli said very clearly the company's revenue growth in the near term will come from existing customers and the forest green i.e existing customers spending more is expanding in the etr survey so very strong confirmation of that trend and note the red is virtually non-existent for snowflake so it's no surprise that snowflake handily beat its earnings on the 25th of august which prompted a flurry of texts to me saying you were right thanks don't thank me do your own research we're just one data source okay so here's a snapshot of some of the major players that announced earnings this past week this chart is our popular xy view with net score or spending momentum on the vertical axis and market share or pervasiveness in the survey in the horizontal plane we talked about snowflake already but i'll emphasize they've held that roughly eighty percent net score for ten plus quarterly surveys now and they've continued to move steadily to the right on the horizontal axis let's make some comments on these other names and then dig in a bit more salesforce of course they're the big player amongst these names that we're showing and as we've said in previous breaking analysis segments they have become the next great software company showing 20 plus growth for five consecutive quarters which is quite impressive splunk as we've reported has struggled in the survey but you can see splunk has a great presence in the data set they have an awesome customer base and the acquisition of signal fx plotted on the left with an elevated next net score represents a really good opportunity to enter new markets like observability and pull signalfx to the right to the rest of splunk's customers and that can help accelerate splunk's move toward a subscription model then there's workday we're plotting the company's core hcm business as well as its emerging financial software suite the latter represents workday's tam expansion opportunity and the company appears to be back on track to show sustained growth now let's dig a little deeper into these names and we'll start with salesforce here's the etr spending profile for salesforce salesforce as we showed earlier has a huge and growing presence in the market and a consistently elevated net score in the etr data and while the chart shows much more green than red and a strong uptick in spending momentum from last october survey this doesn't really tell the whole story salesforce's stock price rocketed out of the march 2020 crash and ran up to a peak last august and is on its way back salesforce has made a number of strategic acquisitions including tableau slack mulesoft and several other billion dollar plus buys as well as a number of smaller acquisitions this past quarter saw 23 revenue growth relative to last year with 20 percent plus operating margins that's huge salesforce's acquisition strategy is beginning to demonstrate the company's promised operating leverage and slack in our view will only add to that benefit including continuous improvement and free cash flow sales force revenue will blow through 25 billion dollars this fiscal year it's a company with a 250 billion dollar market cap and appears to be one a name that has meaningful upside opportunity okay let's take a quick look at splunk we're finally seeing an uptick in splunk's spending momentum with within the etr data set eric bradley and i have discussed this in previous breaking analysis segments the key point as we've reported is we see splunk as a company that has been in transition from a traditional license to an arr subscription model and finally the company is showing clarity that there's light at the end of that tunnel investors don't like companies in transition and like salesforce splunk's stock price ran up to an all-time high last august but then came down hard and never fully recovered but it has come off its may lows and there were some real positives this past quarter cloud annual recurring revenue for splunk this past quarter grew 72 percent and its bookings grew 20 29 year on year the company was conservative in its guidance and there still seems to be some uncertainty around cash flow but more clear guidance by splunk on the top line is a welcome sign and now another name that we've been following that announced earnings this week is elastic and as you can see by the etr data that company has an elevated net score with very little red in the bars now note that blue line while it's slowly decelerating it remains very strong and elevated remember the comment earlier i made about freezing that snowflake blue line in your head the reason we said that is because for snowflake to hold its roughly 80 net score position firmly over the past 10 plus quarters is quite astounding and for the most part it's unprecedented in the etr data set in recent memory back to elastic the company grew its top line by 45 which is a healthy beat and that helped operating margins come in above expectations elastic has become the open source poster child for observability but customers often cite challenges related to complexity and scaling with the need often to seek professional services help which sometimes impacts adoption and cost obviously but overall very strong report especially in its cloud business which grew 89 relative to last year all right let's pivot to infrastructure we're going to do that with palo alto networks and then look at a broader more traditional hardware and software players in february of 2020 we reported the valuation of divergence between palo alto networks and fortinet and we cited the challenges that palo alto was having around its shift to cloud that was a clear headwind at the time especially with regard to some of its go to market challenges at the same time we said that we were confident that palo alto would work through these issues and the csos from the etr panels along with other anecdotal information from the cube community suggested that the company would power through these problems well it has palo alto has a huge presence in the market and consistently elevated net scores as you can see here palo alto stock is trading near all-time highs and it reacted very well to its uh to the earnings report this past week where revenue grew nicely at 20 28 year on year the company has consistently impressed despite some hiccups of the past and appears to be well positioned for the emerging hybrid work economy okay now let's take a look at some of the key infrastructure players that announced this past week this chart shows our popular xy view with netscore spending momentum on the vertical axis and market share and or pervasiveness on the horizontal axis we'll start with vmware it has the biggest presence in the market amongst these names vmware's revenue grew nine percent in the quarter which was in line with estimates the company had a solid quarter but only marginally beat expectations and the stock got hit hard it was down 8 percent midday on friday vmware cited stronger than expected perpetual license sales and somewhat softer sas subscription revenue now it's not surprising that we're going to see some lumpiness in those two lines as the company transitions to a subscription model but investors clearly want to see more growth in sas and subscriptions than they do in the traditional perpetual license model vmware cloud on aws grew 80 and that's confirmed in the data here compute was also strong one concern in the etr data is the vmware cloud which is the the core the vm vmr cloud foundation vcf which you can see here is well off its january net score highs now it's possible the etr is picking up some of the conservative clients that don't want to move to an ar or subscription model it's unclear but we'll continue to watch that trend overall vmware's business model is solid in our view and very very strong now let's talk about dell next dell in our view had a great quarter it grew top-line revenues by 15 year-on-year its client business grew 27 percent and you can see the elevated dell laptop net net scores in this chart the isg business was up three percent that comprises service and networking which was up six percent and storage which was off one percent the storage business contin continues to struggle but management reported that its mid-range storage revenue was up 17 now the challenge here is that high-end storage it's cyclical it's exposed sometimes you know somewhat to mainframe cycles but but but but the other thing is that a lot of the mid-range capability is eating away at the high end not the least which by the way is is pure storage competing at the higher end but also dell's own mid-range business so that continues to be a drag on revenue the the size of the traditional high-end business that that v-max power max business still is is is quite large and the the new is not growing fast enough to offset the decline in in the old but i mean i saw these numbers from dell i was surprised to see the stock down nearly five percent at midday on friday and i think what's happening is a couple things one is that hpq hp inc which we show here at a lower net score than dell's laptop business cited supply chain issues and component shortages now dell cited the same but maybe it's off on sympathy it's clear to us that dell is doing a much better job than hp with regard to managing component shortages the frustrating thing for these companies is it might be a 50 part holding up a server or in dell's case or a laptop in dell and hpq's case but demand is good which is a positive but the biggest factor in dell stock price we think is it's getting dragged down with vmware in a way if you think about it with vmware's value comprising so much of dell's market cap being down only four percent while vmware is down eight percent implies that the core dell business is viewed positively by the street but i thought with the vmware spin coming later this year investors might gravitate more aggressively toward dell but that didn't happen maybe over time now you see netapp on the chart netapp beat on top line revenue and earnings this past quarter however the company has not performed well in the etr surveys for several quarters and has a negative net score this is due when you tear apart the the math this is due to a low number of new adoptions and a fat middle very big fat middle of flat spending and a pretty high churn in the data set now the company claims they've picked up 1500 new customers in its cloud business so maybe maybe the etr survey is not picking that up or perhaps it's existing customers that are moving to netapp's cloud service that they're counting as new that's unclear but netapp claims that its public cloud business grew 155 in the quarter regardless the street likes netapp's story the stock has been acting very well this year out passing outpacing the s p 500. now you also see pure on the chart with a nicely elevated net score the company beat top and bottom lines this quarter and its ceo charlie giancarlo promised roughly 20 percent revenue growth going forward the street sure liked that that story and the stock shot up nearly 20 percent on that news and you can see here a little drill down the etr spending data trends in the right direction for pure to support this momentum pure's messaging is all around a modern data platform and it's clear from customer conversations that its storage products are easier to use than traditional storage offerings and it has a leg up on the as a service trend which we've been reporting on which pure has been pursuing for a number of years but it's still a much smaller player a couple billion dollars than the dells and the netapps of the storage world but if it can continue on a strong growth trajectory it will of course become a larger custom company the question will be how to continue to expand its total available market now the obvious path has been share gains which over the years it has accomplished and has served them well but that won't be as easy as it was last decade when pure caught emc and netapp flat-footed without strong flash array strategies pure's port works acquisition is something to watch as well as it tries to transition the market to a true cloud-like program programmable infrastructure model infrastructure as code and we'll leave you with this thought about the infrastructure space generally in storage specifically while cloud storage has exploded over the past several years on-prem storage has been extremely soft this in our view has been due to the double whammy that we've reported the combination of cloud stealing share from on-prem and the big flash injection in other words the latter suppressed the need to buy more spinning spindles and controllers for better performance and it hurt demand you don't need to do that when you have all this flash headroom but as we predicted last year we believe that there's pent up demand as people go back to work and headquarters need refresh there's only so much blood that it managers can squeeze from the stone moving storage around optimizing servers and and improving things like utilization while at the same time maintaining adequate performance and doing so within some kind of reasonable window of a day storage is no longer monolithic there are emerging use cases especially ones that are data intensive different storage types are emerging as satya nadella said recently we've reached peak centralization and as such that will create tailwinds for storage offerings that can accommodate cloud and on-prem because it pros understand that moving data is expensive and risky it's best to keep data where it belongs for reasons of performance and of course compliance so it looks like there's a decent chance that the long storage winter is over and the market could return to solid growth even the face of a continued cloud explosion now to circle back quickly to the enterprise software business there seems to be no end in sight to the shift to cloud-based offerings both sas and snowflake-like consumption models of which we're big believers digital transformation initiatives are real they're meaningful and software spending we believe is going to be robust and power these transformations for quite some time okay that's it for today remember these episodes are all available as podcasts all you got to do is search breaking analysis podcast we publish each week on wikibon.com and siliconangle.com you can reach me at divalante on twitter or my linkedin posts or email me at david.vellante siliconangle.com please do check check out the etr website at etr.plus and see their new data packages and offerings for all the survey data this is dave vellante for the cube insights powered by etr thanks for watching everybody be well and we'll see you next time [Music] you

from the cube studios in palo alto in boston bringing you data-driven insights from the cube and etr this is breaking analysis with dave vellante nvidia wants to completely transform enterprise computing by making data centers run 10x faster at one tenth the cost and video's ceo jensen wang is crafting a strategy to re-architect today's on-prem data centers public clouds and edge computing installations with a vision that leverages the company's strong position in ai architectures the keys to this end-to-end strategy include a clarity of vision massive chip design skills a new arm-based architecture approach that integrates memory processors i o and networking and a compelling software consumption model even if nvidia is unsuccessful at acquiring arm we believe it will still be able to execute on this strategy by actively participating in the arm ecosystem however if its attempts to acquire arm are successful we believe it will transform nvidia from the world's most valuable chip company into the world's most valuable supplier of integrated computing architectures hello everyone and welcome to this week's wikibon cube insights powered by etr in this breaking analysis we'll explain why we believe nvidia is in the right position to power the world's computing centers and how it plans to disrupt the grip that x86 architectures have had on the data center for decades the data center market is in transition like the universe the cloud is expanding at an accelerated pace no longer is the cloud an opaque set of remote services i always say somewhere out there sitting in a mega data center no rather the cloud is extending to on-premises data centers data centers are moving into the cloud and they're connecting through adjacent locations that create hybrid interactions clouds are being meshed together across regions and eventually will stretch to the far edge this new definition or view of cloud will be hyper distributed and run by software kubernetes is changing the world of software development and enabling workloads to run anywhere open apis external applications expanding the digital supply chains and this expanding cloud they all increase the threat surface and vulnerability to the most sensitive information that resides within the data center and around the world zero trust has become a mandate we're also seeing ai being injected into every application and it's the technology area that we see with the most momentum coming out of the pandemic this new world will not be powered by general purpose x86 processors rather it will be supported by an ecosystem of arm-based providers in our opinion that are affecting an unprecedented increase in processor performance as we have been reporting and nvidia in our view is sitting in the poll position and is currently the favorite to dominate the next era of computing architecture for global data centers public clouds as well as the near and far edge let's talk about jensen wang's clarity of vision for this new world here's a chart that underscores some of the fundamental assumptions that he's leveraging to expand his market the first is that there's a lot of waste in the data center he claims that only half of the cpu cores deployed in the data center today actually support applications the other half are processing the infrastructure all around the applications that run the software defined data center and they're terribly under utilized nvidia's blue field three dpu the data processing unit was described in a blog post on siliconangle by analyst zias caravala as a complete mini server on a card i like that with software defined networking storage and security acceleration built in this product has the bandwidth and according to nvidia can replace 300 general purpose x86 cores jensen believes that every network chip will be intelligent programmable and capable of this type of acceleration to offload conventional cpus he believes that every server node will have this capability and enable every packed of every packet and every application to be monitored in real time all the time for intrusion and as servers move to the edge bluefield will be included as a core component in his view and this last statement by jensen is critical in our opinion he says ai is the most powerful force of our time whether you agree with that or not it's relevant because ai is everywhere an invidious position in ai and the architectures the company is building are the fundamental linchpin of its data center enterprise strategy so let's take a look at some etr spending data to see where ai fits on the priority list here's a set of data in a view that we often like to share the horizontal axis is market share or pervasiveness in the etr data but we want to call your attention to the vertical axis that's really really what really we want to pay attention today that's net score or spending momentum exiting the pandemic we've seen ai capture the number one position in the last two surveys and we think this dynamic will continue for quite some time as ai becomes the staple of digital transformations and automations an ai will be infused in every single dot you see on this chart nvidia's architectures it just so happens are tailor made for ai workloads and that is how it will enter these markets let's quantify what that means and lay out our view of how nvidia with the help of arm will go after the enterprise market here's some data from wikibon research that depicts the percent of worldwide spending on server infrastructure by workload type here are the key points first the market last year was around 78 billion dollars worldwide and is expected to approach 115 billion by the end of the decade this might even be a conservative figure and we've split the market into three broad workload categories the blue is ai and other related applications what david floyer calls matrix workloads the orange is general purpose think things like erp supply chain hcm collaboration basically oracle saps and microsoft work that's being supported today and of course many other software providers and the gray that's the area that jensen was referring to is about being wasted the offload work for networking and storage and all the software defined management in the data centers around the world okay you can see the squeeze that we think compute infrastructure is gonna gonna occur around that orange area that general-purpose workloads that we think is going to really get squeezed in the next several years on a percentage basis and on an absolute basis it's really not growing nearly as fast as the other two and video with arm in our view is well positioned to attack that blue area and the gray area those those workload offsets and the new emerging ai applications but even the orange as we've reported is under pressure as for example companies like aws and oracle they use arm-based designs to service general purpose workloads why are they doing that cost is the reason because x86 generally and intel specifically are not delivering the price performance and efficiency required to keep up with the demands to reduce data center costs and if intel doesn't respond which we believe it will but if it doesn't act arm we think will get 50 percent of the general purpose workloads by the end of the decade and with nvidia it will dominate the blue the ai and the gray the offload work when we say dominate we're talking like capture 90 percent of the available market if intel doesn't respond now intel they're not just going to sit back and let that happen pat gelsinger is well aware of this in moving intel to a new strategy but nvidia and arm are way ahead in the game in our view and as we've reported this is going to be a real challenge for intel to catch up now let's take a quick look at what nvidia is doing with relevant parts of its pretty massive portfolio here's a slide that shows nvidia's three chip strategy the company is shifting to arm-based architectures which we'll describe in more detail in a moment the slide shows at the top line nvidia's ampere architecture not to be confused with the company ampere computing nvidia is taking a gpu centric approach no surprise obvious reasons there that's their sort of stronghold but we think over time it may rethink this a little bit and lean more into npus the neural processing unit we look at what apple's doing what tesla are doing we see opportunities for companies like nvidia to really sort of go after that but we'll save that for another day nvidia has announced its grace cpu a nod to the famous computer scientist grace hopper grace is a new architecture that doesn't rely on x86 and much more efficiently uses memory resources we'll again describe this in more detail later and the bottom line there that roadmap line shows the bluefield dpu which we described is essentially a complete server on a card in this approach using arm will reduce the elapsed time to go from chip design to production by 50 we're talking about shaving years down to 18 months or less we don't have time to do a deep dive into nvidia's portfolio it's large but we want to share some things that we think are important and this next graphic is one of them this shows some of the details of nvidia's jetson architecture which is designed to accelerate those ai plus workloads that we showed earlier and the reason is that this is important in our view is because the same software supports from small to very large including edge systems and we think this type of architecture is very well suited for ai inference at the edge as well as core data center applications that use ai and as we've said before a lot of the action in ai is going to happen at the edge so this is a good example of leveraging an architecture across a wide spectrum of performance and cost now we want to take a moment to explain why the moved arm-based architectures is so critical to nvidia one of the biggest cost challenges for nvidia today is keeping the gpu utilized typical utilization of gpu is well below 20 percent here's why the left hand side of this chart shows essentially racks if you will of traditional compute and the bottlenecks that nvidia faces the processor and dram they're tied together in separate blocks imagine there are thousands thousands of cores in a rack and every time you need data that lives in another processor you have to send a request and go retrieve it it's very overhead intensive now technologies like rocky are designed to help but it doesn't solve the fundamental architectural bottleneck every gpu shown here also has its own dram and it has to communicate with the processors to get the data i.e they can't communicate with each other efficiently now the right hand side side shows where nvidia is headed start in the middle with system on chip socs cpus are packaged in with npus ipu's that's the image processing unit you know x dot dot dot x pu's the the alternative processors they're all connected with sram which is think of that as a high speed layer like an layer one cache the os for the system on a chip lives inside of this and that's where nvidia has this killer software model what they're doing is they're licensing the consumption of the operating system that's running this system on chip in this entire system and they're affecting a new and really compelling subscription model you know maybe they should just give away the chips and charge for the software like a razer blade model talk about disruptive now the outer layer is the the dpu and the shared dram and other resources like the ampere computing the company this time cpus ssds and other resources these are the processors that will manage the socs together this design is based on nvidia's three chip approach using bluefield dpu leveraging melanox that's the networking component the network enables shared dram across the cpus which will eventually be all arm based grace lives inside the system on a chip and also on the outside layers and of course the gpu lives inside the soc in a scaled-down version like for instance a rendering gpu and we show some gpus on the outer layer as well for ai workloads at least in the near term you know eventually we think they may reside solely in the system on chip but only time will tell okay so you as you can see nvidia is making some serious moves and by teaming up with arm and leaning into the arm ecosystem it plans to take the company to its next level so let's talk about how we think competition for the next era of compute stacks up here's that same xy graph that we love to show market share or pervasiveness on the horizontal tracking against next net score on the vertical net score again is spending velocity and we've cut the etr data to capture players that are that are big in compute and storage and networking we've plugged in a couple of the cloud players these are the guys that we feel are vying for data center leadership around compute aws is a very strong position we believe that more than half of its revenues comes from compute you know ec2 we're talking about more than 25 billion on a run rate basis that's huge the company designs its own silicon graviton 2 etc and is working with isvs to run general purpose workloads on arm-based graviton chips microsoft and google they're going to follow suit they're big consumers of compute they sell a lot but microsoft in particular you know they're likely to continue to work with oem partners to attack that on-prem data center opportunity but it's really intel that's the provider of compute to the likes of hpe and dell and cisco and the odms which are the odms are not shown here now hpe let's talk about them for a second they have architectures and i hate to bring it up but remember the machine i know it's the butt of many jokes especially from competitors it had been you know frankly hpe and hp they deserve some of that heat for all the fanfare and then that they they put out there and then quietly you know pulled the machine or put it out the pasture but hpe has a strong position in high performance computing and the work that it did on new computing architectures with the machine and shared memories that might be still kicking around somewhere inside of hp and could come in handy for some day in the future so hpe has some chops there plus hpe has been known hp historically has been known to design its own custom silicon so i would not count them out as an innovator in this race cisco is interesting because it not only has custom silicon designs but its entry into the compute business with ucs a decade ago was notable and they created a new way to think about integrating resources particularly compute and networking with partnerships to add in the storage piece initially it was within within emc prior to the dell acquisition but you know it continues with netapp and pure and others cisco invests they spend money investing in architectures and we expect the next generation of ucs oh ucs2 ucs 2.0 will mark another notable milestone in the company's data center business dell just had an amazing quarterly earnings report the company grew top line revenue by around 12 percent and it wasn't because of an easy compare to last year dells is simply executing despite continued softness in the legacy emc storage business laptop the laptop demand continued to soar in dell server business it's growing again but we don't see dell as an architectural innovator per se in compute rather we think the company will be content to partner with suppliers whether it's intel nvidia arm-based partners or all of the above dell we think will rely on its massive portfolio its excellent supply chain and execution ethos to compete now ibm is notable for historical reasons with its mainframe ibm created the first great compute monopoly before it unwind and wittingly handed it to intel along with microsoft we don't see ibm necessarily aspiring to retake that compute platform mantle that once once held with mainframes rather red hat in the march to hybrid cloud is the path that we think in our view is ibm's approach now let's get down to the elephants in the room intel nvidia and china inc china is of course relevant because of companies like alibaba and huawei and the chinese chinese government's desire to be self-sufficient in semiconductor technology and technology generally but our premise here is that the trends are favoring nvidia over intel in this picture because nvidia is making moves to further position itself for new workloads in the data center and compete for intel's stronghold intel is going to attempt to remake itself but it should have been doing this seven years ago what pat gelsinger is doing today intel is simply far behind and it's going to take at least a couple years for them to really start to to make inroads in this new model let's stay on the nvidia v intel comparison for a moment and take a snapshot of the two companies here's a quick chart that we put together with some basic kpis some of these figures are approximations or they're rounded so don't stress over it too much but you can see intel is an 80 billion dollar company 4x the size of nvidia but nvidia's market cap far exceeds that of intel why is that of course growth in our view it's justified due to that growth and nvidia's strategic positioning intel used to be the gross margin king but nvidia has much higher gross margins interesting now when it comes down to free cash flow intel is still dominant as it pertains to the balance sheet intel is way more capital intensive than nvidia and as it starts to build out its foundries that's going to eat into intel's cash position now what we did is we put together a little pro forma on the third column of nvidia plus arm circa let's say the end of 2022. we think they could get to a run rate that is about half the size of intel and that can propel the company's market cap to well over half a trillion dollars if they get any credit for arm they're paying 40 billion dollars for arm a company that's you know sub 2 billion the risk is that because of the arm because the arm deal is based on cash plus tons of stock it could put pressure on the market capitalization for some time arm has 90 percent gross margins because it pretty much has a pure license model so it helps the gross margin line a little bit for this in this pro forma and the balance sheet is a swag arm has said that it's not going to take on debt to do the transaction but we haven't had time to really dig into that and figure out how they're going to structure it so we took a took a swag in in what we would do with this low interest rate environment but but take that with a grain of salt we'll do more research in there the point is given the momentum and growth of nvidia its strategic position in ai is in its deep engineering they're aimed at all the right places and its potential to unlock huge value with arm on paper it looks like the horse to beat if it can execute all right let's wrap up here's a summary look the architectures on which nvidia is building its dominant ai business are evolving and nvidia is well positioned to drive a truck right to the enterprise in our view the power has shifted from intel to the arm ecosystem and nvidia is leaning in big time whereas intel it has to preserve its current business while recreating itself at the same time this is going to take a couple of years but intel potentially has the powerful backing of the us government too strategic to fail the wild card is will nvidia be successful in acquiring arm certain factions in the uk and eu are fighting the deal because they don't want the u.s dictating to whom arm can sell its technology for example the restrictions placed on huawei for many suppliers of arm-based chips based on u.s sanctions nvidia's competitors like broadcom qualcomm at all are nervous that if nvidia gets armed they will be at a competitive disadvantage they being invidious competitors and for sure china doesn't want nvidia controlling arm for obvious reasons and it will do what it can to block the deal and or put handcuffs on how business can be done in china we can see a scenario where the u.s government pressures the uk and eu regulators to let this deal go through look ai and semiconductors you can't get much more strategic than that for the u.s military and the u.s long-term competitiveness in exchange for maybe facilitating the deal the government pressures nvidia to guarantee some feed to the intel foundry business while at the same time imposing conditions that secure access to arm-based technology for nvidia's competitors and maybe as we've talked about before having them funnel business to intel's foundry actually we've talked about the us government enticing apple to do so but it could also entice nvidia's competitors to do so propping up intel's foundry business which is clearly starting from ground zero and is going to need help outside of intel's own semiconductor manufacturing internally look we don't have any inside information as to what's happening behind the scenes with the us government and so forth but on its earning call on its earnings call nvidia said they're working with regulators that are on track to complete the deal in early 2022. we'll see okay that's it for today thank you to david floyer who co-created this episode with me and remember i publish each week on wikibon.com and siliconangle.com these episodes they're all available as podcasts all you're going to do is search breaking analysis podcast and you can always connect with me on twitter at dvalante or email me at david.valante siliconangle.com i always appreciate the comments on linkedin and in the clubhouse please follow me so you can be notified when we start a room and riff on these topics and don't forget to check out etr.plus for all the survey data this is dave vellante for the cube insights powered by etr be well and we'll see you next time [Music] you

from the cube studios in Palo Alto in Boston connecting with thought leaders all around the world this is a cube conversation on June 23rd the Wall Street Journal reported that Dell is exploring strategic options for its approximately 81% share in VMware both Dell and VMware stocks popped on the news we believe that Dell is floating this trial balloon to really gauge investor customer and partner sentiment and perhaps send a signal to the short sellers that you know what Michael Dell has other arrows in his quiver to unlock in case you want to squeeze me I'm gonna squeeze you back who knows hello everyone and welcome to this week's wiki Bond cube insights powered by ETR in this breaking analysis we'll unpack some of the complicated angles in the ongoing VMware saga and assess five scenarios that we think are possible as it pertains to this story as always we're going to bring in some ETR customer data to analyze what's happening with the spending picture let's take a look at what happened and just do a quick recap The Wall Street Journal story said that Dell was considering spinning off VMware or buying the remaining 19 percent of VMware stock that it doesn't own the Journal article cited unnamed sources and said that a spinoff would not likely happen until 7 September 2021 for tax reasons that would mark of course the 5 year anniversary of Dell acquiring EMC and would allow for a tax free transaction always a good thing what's going on here and what options does Dell really have what does it mean for Dell VMware customers and partners we're gonna try to answer those questions today so first of all why would Dell make such a move well I think there's tweet from your own name Marc he's a portfolio manager at one main capital it kind of sums it up he laid out this chart which shows Dells market cap prior to the stock pop you know it's closer to 38 billion today and the value of its VMware owner which is over 50 billion since the stock pop but let me cut to the chase investors value the core assets of Dell which accounts for around 80 billion dollars in revenue when you exclude vmware somewhere south of negative 10 billion dollars why it's because Dell is carrying more than 30 billion dollars of core debt when you exclude Dell Financial Services and it looks like a conglomerate owning the vast majority of VMware shares Michael Dell has something like a 97 percent voting control Cordell is a low margin low growth business and as some have complained that Michael uses VMware as his piggy bank and many investors just won't touch the stock so the stock generally Dell stock has underperformed I've often said even going back to the EMC days that owning the stock of VMware's owner is actually a cheap way to buy vmware but that's assuming that the value somehow gets unlocked at some point so Dell is perhaps signaling that it has some options and other levers to pull as I said you may be trying to give pause to the shorts now let's have a look at some of the ETR spending data and value and evaluate the respective positions of Dell and VMware in the market place this chart here uses the core ETR methodology that we like to talk about all the time for those not familiar we use the concept of net score net score is a simple metric it's like Net Promoter Score sort of the chart shows element the elements of Dells net score so each quarter ETR goes out and ask customers do you plan to adopt the vendor new that's the lime green at 4% spend more relative to last year more meaning more than 6% that's the forest green and you can see that's at 32% flat spend is the grey meaning plus or minus 5% and then decrease spending by 6 percent or greater that's the pink and that's just 11% for Dell or are you replacing the platform to see that that's the bright red there at 7% so net score is a measure of momentum and it's derived by adding the greens and subtracting the Reds and he can see Dell in the last ETR survey which was taken at the height of the pandemic has a net score of 18% now we we colored that soft red it's not terrible but it's not great either now of course this is across Dells entire portfolio and it excludes vmware so what about vmware so this next graphic that we're showing you it applies the exact same methodology to vmware and as you can see vmware has a much higher net score at 35% which of course shouldn't surprise anybody it's a higher growth company but 46% of vmware customers plan to spend more this year relative to last year and only 11% planned to spend less that's pretty strong now what if we combined dell and vmware and looked at them as a single entity hmm wouldn't that be interesting okay here you go so there were nine hundred and seventy five respondents in the last ETR survey when we matched the two companies together and you can see the combined net score is 27% with 42 percent of respondents planning to spend more this year than they did last year so you may be asking well is this any good how does this compare to dell and vmware competitors well I'm glad you asked so here we show that in this chart the net score comparisons so we take the combined dell and vmware at 27% Cisco as we often reported consistently shows pretty strong relative to the enterprise data center players and you can see HPE is a kind of a tepid 17 percent so it's got some work to do to live up to the promises of the HP HPE split we also we also show IBM red hat at 14% so there's some room for improvement there also and you can see IBM in the danger zone as we break that down and red hat much stronger but you know what it softened somewhat in the EGR survey since last year so we'd like to see better momentum from IBM and RedHat it's kind of unfortunate that kovat hit when it did his IBM was just kind of ramping up its RedHat go to market now just for comparison purposes for kicks we include Nutanix nifty annex is a much smaller company but it's one that's fairly mature and you can see at 52% its net scores much higher than the big whales now we've been reporting for months on high fliers like automation anywhere CrowdStrike octa rubric snowflake uipath these emerging companies have net scores you know north of 60% and even in the 70% range but of course they're growing from a much smaller base so you would expect that now let's put this into context with a two-dimensional view that we'd like to show now as you know in addition to net score that metric we like to use so-called market share market share is a measure of pervasiveness in the data set or essentially market share in the survey and it's a proxy for a real market share so what this chart here does it plots several companies with their net scores on the y-axis and market share on the x-axis and you can see that we combine Dell and VMware together and we plotted them in that red highlighted box just for comparison purposes so what does this tell you about the competitive landscape well first everyone would love to be AWS Microsoft - we didn't plot Microsoft because they're so bloody dominant they skew the chart somewhat but they would be way way out to the right on the x-axis because they have such a huge number of products and mentions in the data set so we left them out now you can see vmware and cisco are kind of right on top of each other which is sort of ironic as they're you know kind of increasingly overlapping with their offerings in the marketplace particularly nsx and you can see the other companies and for context we've added a few more competitors like theme and CommVault and you know they're in a pretty strong position as well as the combination of Dell and VMware so let's start there Steve Phil analyst Brad Reebok was quoted in the market watch publication is saying the following we have long believed Dell would ultimately buy in the approximately 19% our 12 and a half billion of VMware that it does not own in order to gain full control over VMware's substantial free cash flow which is about four billion dollars annually and we still expect this to be the ultimate outcome huh you know I don't know I'm not sure about this on the one hand you can see from the previous chart this would be a better outcome for Dell from a competitive standpoint what it did is it pulls Dell up and to the right yeah but perhaps not so much for VMware as it went down and to the left adèle would have to raise a bunch more cash to do this transaction and what take on even more debt you know maybe it could get Silverlake to finance the deal you know then essentially Dell would become the Oracle of infrastructure you know it certainly would make Dell even more strategic to CIOs would that be good for customers well on the one hand I guess it would bring better integration between Dell and VMware yeah but I wonder if that's the critical issue for customers yeah and nearly and I think it would stifle VMware's innovation engine and a little bit further and I wonder how Pat Yeltsin here would react I mean my guess is he would call it a day and what about Sanjay Putin who was the obvious next in line for the CEO job at VMware what he becomes the president of Dells software division and what about the rest of the team at VMware yes they're a Silicon Valley stalwart and that would slowly morph into austin-based Dell with the debt burden growing you know it's gonna mean more of VMware's cash would go to paying down the debt meaning less for R&D or even stock buybacks what you know I'm not a huge fan of and I'm not a huge fan of this scenario for sure the the technology park partner ecosystem would be ice cold on such a deal although you know you could argue there are already less than lukewarm but here I want to explore some other options so the next on the list is Dell could sell VMware to a private equity firm mmm or a strategic it could basically wipe out its debt and have some cash left over to sail into the sunset that would be a big pill for someone to swallow even though Michael Dell has 97 percent voting power I think there's fine print that says he has a responsibility to protect the interest of the minority shareholders so to get approval it would have to sell at a premium you know that could be as high as you know almost seventy billion dollars Microsoft has the cash but they don't need VMware and Amazon I guess could pull it off but that certainly is not likely even if Google who has the cash we're interested in buying VMware Google be the most likely candidate you know it would give Google Cloud instant access to the coveted enterprise but it's really hard to conceive I mean same for a PE company 65 to 70 billion you know they get their money out in 15 to 20 years so I I just I just don't see that as viable all right what's next how about this scenario of spinning off VMware that the Journal reported so in this transaction Dell shareholders would get a bunch of vmware stock now there may be some financial wizardry that tom sweet dell CFCF owned his band of financial geniuses could swing I can't even begin to speculate what that would be but but I've heard there's some magic that they could pull off to maybe pull some cash out of such a transaction and this would unlock the value of both Dell and VMware by removing the conglomerate and liquidity hangover for Dell and it were to definitely attract more sideline investors into VMware stock and Michael Dell would still own a boatload of VMware stock personally so there's an incentive there so this is interesting and certainly possible you know I think in a way it would be good for VMware customers VMware we get full autonomy and control over its destiny without Delvaux guarding its cash so it could freely innovate Dell would become probably less strategic for customers so I don't think that for Dell EMC buyers you know the technology ecosystem partners like HPE IBM Napa cetera would would would they would like it more but they were already kind of down the path of looking to optimize VMware alternatives so you know think about Cisco but you know I think for VMware customers okay I think for for daily MC customers not so much now what about the do-nothing scenario you know I think this is as possible as any outcome Dell keep chipping away at its debt using VMware as a strategic linchpin with customers sure they continue to pay the liquidity overhang tax and they'll frustrate some shareholders who we're going to remain on the sidelines but you know that's been the pattern anyway now what about delivering some of the VMware ownership so the more I think about it the more I like this scenario what if del sold 20% of its VMware stake and let's say raised ten twelve billion dollars in cash that it could use to really eat into its debt burden a move like this combined with its historical debt pay down could cut its death debt in half by say 2021 and get the company back to investment grade rating something that Tom sweet has aspired towards this one dropped hundreds of millions if not a billion dollars to the bottom line and it would allow Dell to continue to control VMware what I don't know I don't know if there are nuances to this scenario in other words does this dropping ownership from roughly eighty percent to about sixty percent trigger some loss of control or some reporting issue I'm sure it's buried somewhere in the public filings or acquisition Docs but this option to me makes some sense it doesn't really radically alter their relationships with customers or partners so it's kind of stable with VMware maintains its existing autonomy and even somewhat lessens Dale's perceived control over VMware in an attacks Dells debt burden yeah it's still a bit of a halfway house but I think it's a more attractive and as I said stable option in my view okay let's talk about what to look for next you know it looks like the stock market is coming to the reality that we are actually in a recession although it appears that Nasdaq is trying to ignore this or maybe the the markets a little bit off because they're afraid Joe Biden is gonna win the election he's not gonna be good for the for the economy we'll see we'll see what the economic shutdown means for tech companies in this earnings season etrs next survey is in the field and they're gonna have fresh data on the impact of kovat going into the dog days of summer here's what I think let me give you my preview and you'll see in a few weeks you know how accurate is I believe that tech spending is going to be soft broadly I think it's gonna especially be the case for legacy on-prem providers and expect their traditional businesses to to deteriorate somewhat I think there's gonna be bright spots in text protect for sure the ones we've reported on cloud yes absolutely automation you know I'm really looking closely at the battle between the two top our PA vendors automation anywhere in uipath I think there's a really interesting story brewing there and the names that we've been pounding like snowflake the security guys like CrowdStrike and octa and Z scalar I think they're gonna continue to do very well with this work from home pivot we also expect Microsoft to continue to show staying power but because of their size you know they're exposed to soft demand pockets but I think that continue to be very very strong and threatening to a lot of segments in the market now for Dell I think the data center businesses continue to be a tough one despite some of the new product cycles especially in storage but I think dal is gonna continue to benefit from the work from home pivot as I believe there's still some unmet demand and laptops we're gonna see that I believe show up in Dells income statement in the form of their their client revenue I'd love to know what you think you could tweet me at Devante or you can always email me at david dot Volante at Silicon angle com please comment on my LinkedIn post always appreciate I post weekly on silicon angle calm and on wiki bond calm so check out those properties and of course go to e TR dot plus for all the survey action as I say e TR is in the field with the current survey they got fresh Cova data so we're excited the report on that in the coming weeks remember these episodes are all available as podcast wherever you listen this is Dave Volante for the cube insights powered by ETR thanks for watching everyone we'll see you next time [Music]

from the silicon angle media office in Boston Massachusetts it's the cube now here's your host David on tape the imperative to protect data has never been more pressing as companies transform themselves from businesses into digital businesses the intrinsic value of their data Rises exponentially the problem for infrastructure pros is that everything in IT is additive it seems like nothing ever dies which means more things to manage now think about that when you're protecting data you have bare metal VMs now containers you've got cloud you got to worry about the edge all this data needs to be protected not only does this increase complexity it expands the attack surface for adversaries wanting to steal or ransom your data at the heart of all this is a build out of a massively global distributed cloud we saw wave 1 of the cloud which was public wave 2 was really hybrid and that's evolving now in parallel you're seeing the emergence of multi cloud and as I said these earlier trends are additive they're not replacements and with me to discuss these important issues and how Dell EMC specifically is pivoting toward cloud data protection is Beth Phelan who is the president of Dell emcs Data Protection Division that's great to see you well good to be here again so we know the world is hybrid it's a fundamental the on-prem stuff is part of the fundamental digital digital transformations of these these companies and now you've got data protection for the cloud so what do you see happening in that world yeah let's start with what we're seeing in the market we recently remade on our global data protection index we've been doing it for many years and we've been really using that to help us understand the landscape and what our customers need and first not surprisingly it shows that continued trend of movement and reliance towards cloud environments for business applications continuing to increase on top of that the customers despite that are continuing to struggle with ensuring they have the right data protection for their cloud environments right so they're they're struggling you see that we see that as well what what's going on there well what is the data tell you yeah first of all more than half of the customers don't have a comprehensive data protection solution for their Salas cloud native and multi cloud environments more than two-thirds of the customers who may be relying on their cloud service providers for data protection say that they do not have a solution that covers all of their workloads so whether they're working with a cloud service provider or some other vendor they're being really clear that they do not have a comprehensive approach to cloud data protection yeah so I mean you see the cloud adoption is going like crazy but it seems like the data protection component is lagging how is that affecting the traction in your business yeah you know it's a double-edged sword right on one level customers see the advantages of moving to a cloud on the other hand you know they are really looking for vendors that they can partner with to still have the same confidence that the data is protected that they have on Prem and what we're seeing now is that customers are turning to us to help solve that problem we have over a thousand customers using Dell EMC for their Cloud Data Protection and we're narrowing in on three exabyte the data that we're currently protecting in the cloud so it's happening yeah that's pretty good traction so I want to talk about VMware obviously VMware is the linchpin of many customers hybrid strategy and it's a clearly an important component of Dell technologies talk a little bit about the relationship between Dell EMC data protection specifically and VMware I'm interested in you know they've announced project tenzou and there's kubernetes how are you guys working together to really deliver a value for customers so we are super excited about the opportunity to work so closely with VMware because as they're cut in their domain we're working directly with them and that's an advantage that comes with being part of the dell technologies family and so we were the first company to bring data protection for were kubernetes environments out to market it's available now so you'll see us bring that into the tenzou mission-critical has been moved forward partnering closely with with vmware and of course we're already fully certified for vmware cloud it's really an ongoing regular conversation about how we can work together to bring the best to our customers so Beth I gotta ask you so you're part of your role as the leader of the the division is obviously you gotta get a lot of mouths to feed big division you got to make your plan you got to deliver for customers but strategy is another key component of this how do all these cloud trends shape your strategy so core to our strategy is to be the essential provider of data protection for multi cloud environments so no matter where customers are choosing to deploy their applications they can have the same confidence that they always did that that data is protected and the way they can get it back so that's core and if you want three words to remember for our strategy think VMware cloud and cyber cloud is central to it and you're going to be hearing a lot more about it in the weeks and months ahead okay so I gotta ask you break out your binoculars maybe even the telescope what are the future what are the future's look like when you think about the division and the market so we've been talking about cloud for a long time but we are still in the middle of this journey customers are going to rely on the cloud even more for additional use cases and especially in the data protection space right now we're seeing backup to the cloud dr to the cloud but the future will include cyber resiliency that's leveraging cloud deployments you're also going to see more and more of an emphasis on people leveraging SAS for their software consumption and for us that means not only protecting SAS applications but it also means giving customers the option to consume data protection in a SAS model we already do that today with things like cloud snapshot manager with things like the power protect management and orchestration but you're going to see us do even more of that because they're just incredible benefits of people leveraging sass to consume their software data constantly evolving lamps landscape data protection has to evolve with it Beth thanks so much for thank you and thank you keep it right there we'll be right back right after this short break from world famous cloud Studios Dell Technologies presents the world's number one show on data protection solutions for today's organizations it's proven in modern magazine with Jake and Emmy hello everyone and welcome to the premiere of PM magazine where we cover the proven Dell technology solutions that you've come to rely on and the latest modern innovation driving powerful data protection for the future I recently spent some quality time with one of our customers and I learned a thing or two about Dell proven data protection solutions let's watch the clip we've always relied on tell performance efficiency and scale to help us keep pace with our data protection needs but there's so much more for example we've been crushing it with Dell cloud data protection for backup to the cloud in cloud backup cloud tearing cloud dr uh-huh look at the picture it's a huge business advantage how so our costs are down we spend less time on management we're meeting our service levels and we have peace of mind that all of our data is protected right awesome did you talk about how Dells agile development approach is accelerating the speed at which we deliver customer value yes and how cloud capabilities will continue to grow yes and about VMware protection yes and cyber recovery yes I mean we covered all of that as well as the mega trends that require data protection with a modern approach well modern is exactly what our guests today are here to discuss Jake he is Ken fatale a noted data protection expert and joining us from the field on her vacation in the Bahamas is Barbara Penner of the data management Institute thank you both for being here so Ken what should our viewers think about when they hear the phrase modern data protection they should think new requirements for modern applications cloud native workloads Cubana is multi-cloud and data services to name a few Barbara would you add anything to that list I would add business service recovery on premises or in the cloud autonomous protection to auto detect and protect workloads across edge core and cloud infrastructure and lastly all of this must operate at global scale thank you both this is exactly where we're heading with Dell power protect solutions well it's time for a break but when we come back we've got something special in store for you don't we Jake I was hoping you forgot oh no someone learned how to make cream puffs and it did not turn out well for him yeah my apologies in advance to my mother who tried to show me around the kitchen but as you can see we'll be right back [Music] we're back with Rob and Rob Emslie who's the director of product marketing for Delhi MCS data protection division Rob good to see you hi Dave good to be back so we just heard from Beth about some of the momentum that you guys have from your perspective from a product angle what is really driving this yeah well one of the things that we've you know definitely seen is that as we talk to our customers both existing and new customers cloud journeys is is top of mind for all of the CIOs it's being driven by either the desire to drive efficiency take out costs and data protection is one of the the most common use cases and one of the things that we find is that there's four use cases for data protection that we see long term retention of data cloud disaster recovery backup to the cloud and the emerging desire to stand up new applications in the cloud that need to be protected so backup in the cloud really completes the four major use cases well one of the things I think is really important this market is that you deliver optionality to your customers so how are our customers enabling these use cases yeah so the the first two UK's first two use cases of long term retention and cleitus recovery is is really driven by our software on our appliances both of those are really predicated based upon the assumption that customers are going to deploy data protection on premises to protect their on-premises workloads and then it's here to the cloud or which is becoming more common used to cloud as a disaster recovery target you know it's delivered by our data protection software and that's either in a software form factor or that software delivered in an integrated appliance form factor so let's talk about purpose-built backup appliances I think you know our friends at IDC I think you know coined that they tracked that market for a while you guys have been a leader there the acquisition of data domain obviously put you in a really strong position give us the update there is it's still a vibrant market is it growing what's the size it's it look like yeah so as we look at 2020 you know IDC forecasts the market size to be a little under five billion dollars so it's still a very large market the overall market is growing at a little over four percent but the interesting thing is that if you think about how the market is is made up it's made up of two different types of appliances one is a target appliance such as data domain and the new power protect dd and the other is integrated appliances where you integrate the target appliance architecture with data protection software and it's the integrated appliance part of the market that is really growing faster than the other part of the of the people being market it's actually growing at 8% in fact IBC's projection is that by 2022 half of the purpose-built back to appliance market will be made up of integrated appliance solutions so it's growing at twice the overall market rate but you guys have two integrated appliances what why - how should people think about those yeah so a little under three years ago we introduced a new integrated appliance the called the integrated data protection appliance it was really the combination of our backup software with our data domain appliance architecture and the integrated air protection appliance has been our workhorse for the last three years really allowing us to to support that that fastest-growing segment of the market in fact last year the integrated air protection appliance grew by over a hundred percent so triple digit growth was great you know it's something that you know allows us to address all market segments all the way down to SMB all the way to the enterprise but last year one of the things you may remember at Delta Nadi's world is we introduced our power to protect portfolio you know and that constituted power protect data manager our new software to find platform as well as the delivery of packet there in an integrated appliance form-factor with perfectly x400 so that's really our our new scale out data protection appliance we've never had a scale out appliance in the architecture before in the portfolio before and that gives us the ability to offer customers choice scale up or scale out integrated and target and with the X 400 it's available is a hybrid configuration or it's also our first or flash architecture so really we're providing customers with the existing software solutions that we've had in the market for a long time an integrated form factor with the integrator protection appliance as well as the brand-new software platform that will really be our innovation engine that will be where we'll be looking at supporting new workloads and certainly leaning into how we support cloud air protection and the hybrid cloud reality of the next decade okay so one of the other things I want to explore is we've heard a lot about your new agile development organization Beth has talked about that a lot and the benefit obviously is you're more you're able to get products out more quickly respond to market changes but ultimately the proof is in translating that development into product what can you tell us about how that's progressing yep so certainly with Papa Tech Data Manager and the X 400 that really is the the epicenter of our agile product development activities you know we've moved to a three-month cadence for software releases so working to deliver a small batch releases into the market much more rapidly than we've ever done before in fact since we introduced palpitate Denham manager where we we shipped the first release in July we're now at the third iteration of palpitate Data Manager and therefore the third iteration of the x100 appliance so there's three things that you know I'd like to highlight within the x100 appliance specifically first is really the the exciting news that we've introduced support for kubernetes so we're really the first you know large enterprise data protection vendor to to lean into providing kubernetes data protection so that becomes the vitally important especially with the developments over our partner in VMware with vSphere 7 with the introduction of tan zoo and the reality is that customers will have both these fear virtual machines and kubernetes containers working side-by-side and both of those environments need to be protected soap a patek denim algae and the x400 appliance has that support available now for customers to take advantage of second we talked about long-term retention of of data in the cloud the x100 appliance has just received the capabilities to also take part in long term retention to AWS so those are two very important cloud capabilities that are brand-new with the excellent appliance and then finally we introduced yet 400 appliance with a maximum configuration of four capacity cubes rough-and-tough that was 400 terabytes of usable capacity we've just introduced support of 12 capacity cubes so that gives the customers the ability to scale out the x100 appliance from 64 terabytes all the way to over a petabyte storage so now if you look at our two integrated appliances we now cover the landscape from small numbers of terabytes all the way through to a petabyte of capacity whether or not you pick a scale up architecture or a scale length architecture yeah so that really comes back to the point I was making about optionality and kubernetes is key it's gonna be a linchpin obviously a portability for multi cloud sets that up as we've said it's it's not the be-all end-all but it's a really necessary condition to enable multi cloud which is fundamental to your strategy absolutely alright Rob thanks very much for coming on the cube it's great to have you thanks Dave and thank you for watching everybody this is Dave Volante for the cube we'll see you next time [Music]

(upbeat music) >> Hello and welcome to the Cube Studios in Palo Alto California, for another Cube conversation. Where we go in-depth with thought leaders driving innovation across the tech industry. I'm your host Peter Burris. Every Enterprise is saddled with the challenge of how to get more value out of their data. While at the same time trying to find new ways of associating value with product or value with service and to work with the different technology suppliers to create an optimal relationship for how they can move their business forward within a data-driven world. It's a tall order but 2020 is going to feature an enormous amount of progress and how enterprises think about how to handle the people, process and technology of improving their overall stance towards getting value out of their data. So to have that conversation today, we're joined by a Guy Churchward, who's the CEO of Datera. Guy welcome back to the cube. >> Thank You Peter, I appreciate it. >> So before we go any further give us a quick update what's going on with Datera? >> We're doing pretty well. I mean this year's we're just going to close it off. So we're in Q4 right at the end of it. You mentioned data-driven, you know I mean that was obviously one of my key excitements, years ago we kind of moved from a hardware resiliency or Hardware-driven to software resiliency, Software defined and I do think that we've hit that data-defined, data-driven infrastructure right now. I've been in the CEO role now just about a year. I've been on the board since August of a year and change ago and part of it is we had a little bit of an impedance mismatch of message, technology and basically I go to market. So the team quite brilliantly produced this data services platform to do data driven architectures. >> Mmmh. >> But customers don't wake up every morning and go, I need to go buy a data-driven, how do I buy one? And so when I came in I realized that you know what they had was an exceptional solution but the market isn't ready yet for that thought process, and what they were really buying still was SDS, software defined storage. >> So it almost in a connect way. so I'm going to buy an SDS and connect it to something and get a little bit of flexibility over here but still worry about the lock in every where else. >> Yeah, exactly and in fact even on the SDS side. What they weren't looking for is bring your own server storage. What they were looking for was automation and they were looking to basically break out and have more data mobility and data freedom. And so that was good and then the second one was our technology really sells directly to enterprises, directly to large scale organizations and it's very difficult as a start-up, small company to basically be able to punch straight into a global account, you know. Because they'll sit back and say, well you know would you trust your family jewels to a company that's got 40 employees in Silicon Valley. >> Right. >> And so what you really have is this and get the message right and then make sure you have to flow through to the customer credibility right and we were fortunate to land a very strategic relationship with HP. And so that was our focus point. Right. So we basically got on board with HP, got into their complete program, started selling very closely to them of which their sales team has been marvelous and then we're just finishing that that year. The good news is and you know I'll give you a spoiler I care about Billings, you know I mean we actually move from an appliance business to a software business exclusively, and so we basically sell term agreement. So if you think about it from a bookings perspective, that's important but basically how much you bill out is more important. From a Billings perspective I think we're going to run roughly 350% up year-over-year. >> Ooh. >> Yeah which is kind of good. Right I mean in other words it was a bit of a pat on the back that seems very happy with that and then even from new account acquisitions if I count the amount of accounts that we bought in this year and to date, entirely since 2013 we've only had one customer churn, so all the customers are coming with us but if I count this year, if I look at 16 17 and 18 we've actually bought more customers on board in 19 than all three pulled together. So we're actually finishing a very very strong year. >> Congratulations. Now if we think about going into 2020 you're closing this quarter, but every startup has to have a notion of what's going to happen next and what role you're going to play. And what happens next. So if I look back I I see the enterprise starting to assert themselves in the cloud businesses. That's having an effect on on everybody. But it really becomes concrete you know, the rubber really meets the road at the level of data. So as you start to grow you're talking more customers, as you talk to more customers and they expressed what they need out of this new cloud oriented world, what kinds of problems are they bringing to the table as far as you're concerned? >> Yeah, I mean they initially come to us so what I would say is every account that we've run we've replaced traditional arrays storage arrays and every account we've run, we've actually competed against SDS vendors and whether that's something like Dells, VxFlex or even vSAN, VMware's vSAN and which are probably the two most well-known ones. A lot of cases I mean we actually have 100% win rate against that in these competitive situations, but interestingly most customers now are putting dual source in place. So in fact the reason that we've ridden pretty quickly and we've run lots of deals, isn't because we're going in and saying VxFlex is failing or vSAN is failing, but they want something extra, they want automation, they want desegregation, they want scale >> They want second source. In many respects of sales is, it's succeeding but you have to push a little bit harder and that is ease most easily done by bringing in another platform with crucial functionality... >> Yeah >> ...and a second source. >> And I think you're on the money there Peter because if I look at second source in the traditional array business, no CIO worth their soul is a single source vendor so they they will have Dell and they'll have HP or they'll have HP and they'll have Pure, doesn't matter and and even on HCI you'll see the HCI vendors, Nutanix is doing very well, so is Dell. So therefore they'll have that from second source if its critical. So if an environment is critical they always have a second source and so even now when you look into software-defined, this market in 2019 was very much like the, let's get the second source in place. And that shows you where we are on the maturity curve because people is basically moving on this en mass. Now that's 2019 you're asking about 20, 21, 22 moving forward. The reason that the traditional arrays weren't working for them is whether it's flexibility or it's basically management costs or maintenance, but it's data freedom. It's what they're really looking for. You know, what is a data center? Is it on-premise, is it cloud? It's definitely cloud but the question is is it on-premise cloud? Is it hybrid cloud, is it public cloud? And then you mention edge. You know we actually find customers who are looking and are saying look, the most important thing for us is being data-driven and what data-driven basically articulates is we get data in, we analyze it, we make decisions on it and we win and lose against our competition as fast as we can be accurate on that data set. And a lot of the decisions are getting made at the edge. So a lot of people are looking at saying my data center is actually at the edge, it's not in the center in the cloud, right. >> Well in many respects, it's for the first time a data center actually is what it says it is, right. Because the data center used to be where the hardware was and now increasingly enterprises are realizing that the services and the capabilities have to be where the data is. >> Yeah. >> Where the data is being produced, where the data is being utilized and certainly where the data, where decisions are being made about what to keep what not to keep, how much of it etc, and that that does start to drive forward an increased recognition that at some point in time we are going to talk more about the services that these platforms, or these devices or these software-defined environments provide. Have I got that right? >> Yeah, yeah you have and even if you look at that, you know ... what the AI/ML, you know I mean if I if I kind of step back and I look at what a customer's trying to do which is to utilize as much data as possible, in a way that they have data freedom that allows them to make decisions and that's really where AI and machine learning comes in. Right you know everybody employs that. I recently bought a camera, shockingly inside the camera it's got ML functionality into it, it's got AI built into it, my new photo editing software on my iPad is actually an ML-based system. They don't do it because it's a buzz word, they do it because basically they can get a much higher level of accuracy and then use data for enrichment, right. And then in the ML track, the classic route was I'm going to create a data lake, right. So I got my data lake and I've got everything in it then I'm going to analyze off the back of it. But everybody was analyzing once it's in the data lake. And what they've realized is to compete, they actually have to analyze much quicker. >> Right. >> And that's at the edge, and that's in real-time and that string based. And so that's really where people are sort of saying I can't ... I'm not going to have any long pole in my technology tent. I'm not going to have anything slow me down, I have to beat my competition and as part of that they need complete fluidity on their data. So I don't care whether it's at the edge or it's in the center or in the cloud, I need instant access to it for enrichment purposes and to make fast and accurate decisions. So they don't want data silos. You know, so any product out there that basically says me me me me give me my data and therefore I'm going to encrypt in such a ways you can't read it and it's not available to anybody else. They are just trying to eradicate that. And and we've sort of moved. It's a weird way of putting it but we've moved from hardware-defined to software-defined and I think we've moved into this data-defined era. But at the same time, it's the most stupid thing for me to say, because we've never not been in a data-defined era. But it's the way in which people think with their architecture as they sign up a data center now or a cloud and they're not saying, hey so about the hardware, it's based on that or it's the software. It's always going to be about the data. The access to the data, however before you get excited. (laughs) The thing that I kind of look at I say so what has fundamentally changed? And it's the fact that we always used to have to make a decision. You know, I ran a security analytics business and when you do things like log management, it's about collecting as much as data so in other words accuracy beats speed. And then security event management is speed beats accuracy. Because you can't ask questions of the same data. But technology is caught up now. So we've actually moved from the do you want accuracy? Or do you want speed? It's like "or arena". So people were building architectures in this "or" world, you know. Do you want software-defined? If you want software-defined you can't have Enterprisilities. Why not? Well, if you want an enterprise application, I mean remember the age-old adage. You should never buy a version 1.0 of an app. >> Right. But what happens is they want they want this ... people are turning around saying I need an enterprise application, I want full data access to the back of it, I actually need it to be fluid, I need it Software-defined, I don't know where it's going to be based and I don't want to do forklift upgrades. I want and and and and and. Not or, so what we've actually moved to is a software-defined era you know, and a data-defined architecture in an "and arena". And where customers are truly winning and where they're going to beat their competition, is where they don't settle and say oh I remember back two years ago, this happened and therefore we should learn from that, and we shouldn't do that. They're actually just breaking through and saying I'm going to fire the application up I want it up and running within 30 days, I want it to be an enterprise application, I need it to be flexible, I needed to have a hype of scale and then I'm going to break it down and by the way I'm not going to pay contractually to an organization to build all that infrastructure. And that's really why soup to nuts, as we move forward not only they sort of building an infrastructure is data-defined infrastructure, they don't want lock-in. They want optionality and that means they want term licenses which is sure, they don't want these proprietary silos and they need data flexibility on the back of it. And those are the progressive customers, and by the way I've not had to convince a single customer to move to software-defined or data-defined. Every client knows they're going there, the question on the journey is, how fast they want to get. >> Right, when? >> Yeah. >> So if so look every single every single enterprise, every single business person takes a look at what are regarded as the most valuable assets and then they hire people to take care of those assets, to get value out of those assets, to maintain those assets, and when we move from a hardware world where the most valuable asset is hardware that leads to one organization, one set of processes, one set of activities. Move into a software world to get the same thing. But we agree with you, we think that we are moving to a world that is data first, where data is increasingly going to be the primary citizen and as a consequence we're seeing firms reinstitutionalize how work is done, redefine the type of people they have, alter their sourcing arrangements, I mean there's an enormous amount of change happening because data is now becoming the primary citizen. So how is Datera going to help accelerate that in 2020? >> Yeah I mean and again that's part of data access. And then also part of data scale. Back probably six seven eight years ago. EMC we were even I remember Steve Manley is a good buddy of mine, we went on stage and we talked about bringing sexy back to back up. We were trying to move away from backup admins just being backup admins to backup admins actually morphing their job into being AI/ML. You know, I remember a big client of mine, and it wasn't in the EMC days, it was before that were basically saying they have to educate their IT staff, they want to bring them up as they move forward. In other words, you can't ... what you don't want is you don't want your team, because it all comes down to people. You don't want them stuck in an area to say we can't innovate forward because we can't get you away from this product, right. So one of our customers at Datera is a SaaS vendor. And their challenge is they had traditional array business even though it was in a SaaS model, it was basically hardware in the background and they would buy instances and they found that their HR cost, their headcount cost was scaling, >> With the hardware. >> Exactly, and and they were looking at and going, what does that do to my business? It does one or two things, either one is it means that cost I mean do I bear that I don't make profitability and I can't drive my business or do I lay that on my customers and then the cost goes up and therefore I'm actually not a cloud scale. And I can't hire all the people I need to hire into it. So they really needed to move to a point of saying how do I get to hyper scale? How do I drive the automation that allows me to basically take staff and do what they need to do. And so our thing isn't removing staff, it's actually taking the work that you have and the people and put them in a way they really matter. So in other words if you think about the old days of I'm going to mess this up but, I talked to somebody recently about what IT stands for. And they said IT should stand for information technology, right. I mean that's really what it is. But, but you know for the last 20 years it stood for infrastructure technology? >> Yeah. >> And that's frustrating, because in essence we got way too many people managing a lot of crap. And what they really should be doing is focusing on what makes the business happen. >> Yeah. >> And for instance I like to run a business by money in and money out, everybody else does and then you look at it and you say well, how do I get more money coming in? By being smarter and quicker than somebody else. How do I do that? By data analytics. Where do I want to put my work? Well I want to put it into the ML/AI and I want more analysts to work on it. I want my IT staff to do that. Let's move them into that. I don't want them you know rooms and reams of people trying to make it you know manage arrays that don't function the way they should or... >> One more percent out of that array of productivity. >> Yeah, abnormally trying to scale HCI solutions to a hyper scale that actually is impossible for them to do it. >> Right. >> You know and and that was the thing that really what Mark, who was the founder of Datera and the team really did is they looked at it from a cloud perspective and said it's got to be easier than this. There must be a way of doing low lights-out automation on storage. And that's why I was saying when I took over, I kind of did the company an injustice by calling it an SDS Tier 1 vendor. But in reality that was what customers could assume. And we're basically a data services platform that allows them to scale and then if you hop forward you go how do you open up the platform? How do you become data movement? How do you handle multi-cloud? How do you make sure that they don't have this issue? And the policies that they put in place and the way in which they've innovated, it allows that open and flexible choice. So for me, one is you get the scale, two you don't have forklift upgrade three is you don't have human capital cost on every decision you make, and it actually fits in in a very fluid way. And so even though customers move to us and buy us as a second source for SDS, once they've got the power of this thing they realize actually now they've got a data service platform and they start then layering in other policies and other systems and what we've seen is then a good uptick of us being seen as a strategic part of their data movement infrastructure. >> You expand. >> Exactly. >> Guy Churchward, CEO of Datera, thanks again for being on the Cube. >> My pleasure. Thank you Peter. >> And thank you for joining us for another CUBEConversation. I'm Peter Burris, see you next time. (upbeat music)

from the silicon angle media office in Boston Massachusetts it's the queue now here's your host David on tape hello everyone and welcome to this week's episode of the cube insights powered by ETR you know this past week we attended the Dell technologies Industry Analysts event and in this breaking analysis I want to summarize the key takeaways and discuss some of the macro trends in the industry that are affecting Dell I'll also discuss some of the fundamental assumptions that Dell is making in its operating model and I'll talk about some of the challenges that I see for the company going forward and hopefully what is a frank manner now let me start with the event itself it was held in Austin Texas and it's clear that Austin Texas is becoming the epicenter of Dell post-acquisition of EMC it's shifting strongly back to Texas while the legacy of EMC remains what is the most critical part of Dells portfolio thanks to vmware the energy of Dell emanates from its founder Michael Dell the event was attended by about 250 press and analysts over a two-day period it was very well run with strong levels of executive access which is always very important to the analysts and lots of transparency and I thought clarity of message now the number one takeaway on this is Dell in four years the company has gone from irrelevance to a dominant and highly relevant player in the enterprise tech especially the CIOs and it's one of the most amazing transformations of a company that personally I've ever seen and I've seen several there were four other key takeaways for me that I'll show on this first slide of Alex if you bring it up first Michael Dell has put forth a set of moonshot goals for 2030 let me give you some examples by 2030 Dell says that for every product that they sell they're going to recycle an equivalent product by 2030 50 percent of the global workforce of Dell will be women and 40 percent of the managers of people will be women 25 percent of the u.s. workforce will be either Hispanic or African now most tech stories today are negative and this is a great positive message I'm not gonna spend a lot of time on this because in there's much more that Dell laid out but kudos for Dell to make for making these initiatives a priority you know particularly the women in tech and the diversity in the minorities I think it's excellent the second takeaway is Dell for Dell is the Dell is being driven by Jeff Clark and this guy is on a mission to simplify the portfolio Dell claims its reduced its product portfolio from 88 platforms down to 20 of that power platforms that powers a new brand now the reality is Dell really hasn't deprecated 68 products many if not most are still around but the RMD energy is all going into the new stuff now the third takeaway was a big announcement around power one power one is Dells new platform for the next generation of converged infrastructure now a lot of people might look at this and say well this is converged infrastructure without Cisco well it is actually and while that's true power one according to Dell is a much more of a developer friendly API and micro services based platform with a lot of automation software built in it's essentially going to be Dells go forward platform for customers that don't want to roll their own infrastructure the expectation or inference that that we took away was that power one will integrate most if not all future storage networking and server products Adela's positioning this as a complement to HCI or hyper-converged infrastructure which comprises VX rail VX flex which is the scale i/o and of course the OEM Nutanix so you can see Dell still got some work to do in terms of streamlining its portfolio and here's my lock of the day is that they'll be phasing out the Nutanix OEM relationship you could take that one to the bank now the fourth takeaway was the Dells cloud strategy is really coming into focus is it a winning strategy I honestly can't say at this point but in my view it's the only option that Dell has and and because of VMware they have a fighting chance Dell is in a much better position than other suppliers that that rely on you know Prem install bases because of VMware VMware is not only Dells piggy bank it is but it also gives Dell strategic levers with with CIOs and partners like for instance AWS now later on I'm going to share some ETR data that will give you some context but the bottom line is that the cloud is having an impact on everyone's business including Dells and I mean let me add the Dells cloud strategy in addition to relying on VMware is completely dependent on the assumptions that the world is going to be hybrid which is a good assumption and that multi cloud is going to evolve from what today I've said as a symptom of multi-vendor to a fundamental priority for CIOs again not a bad assumption but because of VMware adele has more than a fighting chance to compete for share now finally that that adele is going to be able to capitalize on the edge personally I think this is the biggest wildcard what I do think is that developers are going to be a crucial part of the edge and at this point in time Dell and VMware are not really top of mine in the developer community now the event involved keynotes from Michael Dell and other execs including including the CFO it was Tom sweet and and many other breakout sessions you know the normal one-on-ones as well now I don't have time to go into all this but there are some things that I want to share about Jeff Clark's presentation specifically he's the person that took over from David David Gordon a couple years ago he's been at Dell for more than 30 years and he was there when I think it was called pcs limited so a long time he's a trusted operational executive of Michael Dell's I'm very impressed with this guy he doesn't use a cheap prompter when he talks and in fact he has some notes but he's got these facts and figures at the in his head that he rattles off like a staccato pace he's an OBS exec and so let me summarize the his discussion now to bring up this slide the the big picture is the data sphere is gonna grow to 175 zettabytes and half of that is going to be created at the edge of that 30% is gonna require real-time processing now he talked about the mandate for simplification and he called this staying the easy button now in QA I asked him like why did it take you guys so long to figure out something so obvious which is kind of a snarky analyst question not his credit he didn't throw his predecessors under the bus rather what he did is he focused on the future and sit he said you know they shared the figures that I stated earlier about you know taking 88 platforms down to 20 and he focused on the priorities of the future so he didn't say it but I'm gonna say it for him he inherited a very messy portfolio and he had to clean up the crime scene me tell let me tell you what a buyer said about EMC back in 2018 this is from the ETR Venn survey when they go out and they probe you know specific customers and they talk to them this guy says NetApp has done a really good job of advertising and positioning itself within the cloud and within data centers themselves they've got a broad portfolio and I don't want to make comments about NetApp but so just I'm not sure I agree with all this but okay come back to his statements and and they've they've integrated fairly well here's what's relevant what he said was EMC on the other hand is not as well integrated they've got a broad portfolio but it's not necessarily - easy easy to pick and choose from the different categories okay so I agree with that you know look the mega launch product dujour worked for EMC it allowed them to carry on for another five or six years after the downturn but the lack of integration eventually caught up to that minute and it will always you know caught up catch up to large companies who rely on either lots of M&A or spinning out new products with lots of overlap anyway I digress the third thing that Clarke talked about was the big market size and the share gains pcs are a 200 billion dollar market servers are an 80 billion dollar market an external storage is a 26 billion dollar market Della's gains 600 basis points according to Clarke in pcs over the last six years 400 came in the last three years 375 basis points in storage in the past two years now of course what he didn't mention that was after a dismal performance a few years earlier so they had a pretty easy compare but my point is this when you talk to Michael Dell you talked to Tom sweet you talked to Jeff Clark and all the people folks in the company share gains are critical to Dells strategy especially because the cloud is taking so much share of wallet in the enterprise I'll make some other comments on that now finally there are two fundamental beliefs that dell has that i want to share with you one is that they can be a consolidator of these core markets in a downturn deltax they can hold their breath you know so to speak longer than the competitors and of course in an up market they think they can accelerate their leverage points which leads to the second belief that jeff clark talked about which is how dell will deliver differentiation and value so he decided four items there one is they got 40,000 direct sellers so they got a big go-to market presence they got 35,000 service professionals a 66 billion-dollar supply chain and then Dell financial services arm which you know forces Dell to carry a lot of debt but that debt throws off cash and it's not really part of Dells core debt from EMC acquisition now others have that too but but Dells got you know big presents there all right so I want to pivot to the ETR data and let's see how Dell looks in the spending survey and since market share is so important to Dell why don't we take a look at how they're doing so Alex this slide that I'm showing here what each er refers to as market share market share is defined by you TR as vendor citations in the survey excluding replacements so customers that are adding spending the same or spending more as spending less divided by the total number of respondents in the survey so it's a measure of how pervasive the vendor is in the data set what I'm showing in this slide is Dells market share and its three most important business lines namely VMware Delhi MC and Adele's laptop business and I'm showing this from the January 17 survey to October 19 now notice the survey sample overall is 960 for respondents and the three brands they show 800 and said six hundred and twenty two and three hundred and two shared ends within that 964 so there's two points one else doing pretty well I mean I'd say it's better than holding serve and as you can see it's steadily gaining now the second point is that look at the net scores here you know they're okay especially for vmware intel's laptop but Dell EMC for instance specifically their server and storage and networking business you know not so much so there's there's a mixed story here so let me make some comments on the macro and things that I've discussed with with ETR and and my narrative on demand overall some things that I've said you shared with you before as we've discussed in past breaking analyses spending is reverting back to pre eighteen levels but it's not falling off a cliff we're seeing fewer adoptions of new tech and more replacements of old tech so combine this with lower levels of spending and more citations overall we're seeing net score go down relative to previous surveys so here's what we think is happening there's less experimentation going on with the digital initiatives which started you know back in 2016 so you're seeing fewer adoptions of new tech as customers are start placing their bets and they're retiring leggy legacy systems that they were keeping on as a hedge and they're narrowing their spend on the new stuff and unplugging the stuff they don't need anymore and they're going at the serious production mode with the pocs so that means overall spending is softer it's not a disaster but it's lower than expected then coming into this year storage is on the back burner in a lot of accounts because of cloud and the big flash injection that I've talked about giving him more Headroom servers are really soft for Dell especially because they have a tough compared with previous with last year PC is actually pretty good all things being considered so where is the spending action well it's in the cloud now q how many vendors tell me that there's a big rebate repatriation trend happening ie people have cloud remorse and they're all moving back on pram not all but many M say it doesn't happen but at the macro-level its noise compared to the spending that's happening in the cloud just do the math all you got to do is look at AWS and Microsoft and what they report and compare it to any enterprise company that relies on on-prem selling I mean I don't want to argue about it you believe what you want but I would much prefer to look at the data so let's do that so here's a slide that shows ETR data on customer spending on the cloud so you got a AWS Azure and Google spenders and how their spending patterns have changed over time for dell emc servers so you got six hundred and thirty six cloud accounts 175 to 200 shared dell emc server accounts over the past three periods and yet net scores of 24% down to 16% so look at the gray bar versus the yellow bar gray is October 18 yellow is October 19 okay you get the picture the next slide is the same view for Dell EMC storage the gray bar is last year yellow bar is this year's survey so look at it 22% down to 5% that's not good so storage is getting hit by cloud and that's going to continue all right so let me conclude with some comments in general overall I like to tell strategy you know honestly without VMware I'm probably not gonna fly to Austin this week just being honest but with VMware Dell is far more important to our community so I pay more attention to it I haven't shared many thoughts on Dells financials but I think they have some upside here as they continue to pay down their debt by the way every five billion of dollars that they retire in debt it drops twenty five cents right to earnings per share Dell throws off a lot of cash it's a very well-run company they got an excellent management team we talked about their share gain lever they'll have a public cloud so they got to make on Prem as simple as possible and ideally is cloud like as they can you know the on-premise experience frankly is well behind that of the cloud but but cloud you know getting less simple and it's not cheap so on Prem in my view doesn't have to be exactly cloud it's just got to be good enough now Dell this week also refreshed its on demand pricing but it's good and it's obviously relevant to cloud not have time to go into all the detail but suffice to say that near-term there on-demand stuff it's it's going to be a small factor in their business but longer-term I think it's going to play in it's particularly to the cloud model Dell is also betting on hybrid and multi cloud they have to and but they're up against several competitors Microsoft is the is really strong in this space Microsoft's also a partner of course but you got IBM and Red Hat Cisco Google sort of and some others but VMware it gives Dell an advantage and that is the key the big hole that I see in Dell I'm going to come back to innovation you know Dell spends billions of dollars on R&D I think it's the numbers 20 billion over the last four years so that's good but you know innovation this industry is being delivered delivered by developers no those are the drivers and and it's they're taking advantage of data applying machine intelligence and cloud for scale and Dell is clearly well positioned for the data trend you know could partner for cloud it can certainly play an AI but what it lacks in my opinion is appeal to the developer community and just as Dell has become relevant to CIOs it needs this a similar type of relevance with the devs and that's a different ballgame so it's hopes are leaning on VMware and is of course its acquisition of pivotal but if I were Dell I would not sit back and wait for pivotal and VMware to figure it out here's what I would do if I were Dell I would deploy at least a thousand engineers they got twenty thousand engineers take a thousand or fifteen hundred them and point them toward developing open source tools and build applications and tools around all these hot emerging trends that we hear about multi-cloud multi cloud management edge all the innovations going on at edge autonomous vehicles etc AI workloads machine intelligence machine learning I would open-source that work and make a big commitment to the developer community big contributions and that would build hooks in from my hardware into these tools to make my hardware run better faster cheaper on these systems I want to thank my friend Peter burrows for forgiving me that idea but I think it's a great idea I think it's radical but it makes sense in this world that is really being driven by developers okay this is Dave Volante signing out from this episode of cube insights powered by ETR thanks for watching we'll see you next time