(bright music) >> Okay, welcome back everyone. It's theCUBE's coverage here in San Francisco, California. We're live on the show floor of AWS Summit 2022. I'm John Furrier, your host of theCUBE. And remember AWS Summit in New York city coming up this summer. We'll be there as well. And of course, re:Invent at the end of the year for all theCUBE coverage on cloud computing and AWS. The two great guests here from the APN, Global APN, Serge Shevchenko and Jeff Grimes Partner Leader. Jeff and Serge is doing partnerships. Global APN >> AWS Global Startup Program. >> Okay, say that again. >> AWS Global Startup Program. >> That's the official name. >> I love it >> Too long for me. Thanks for coming on. >> Yeah, of course. >> Yeah, appreciate it. >> Tell us about what's going on with you guys? How was you guys organized? You guys, we're obviously we're in San Francisco bay area, Silicon Valley, zillions of startups here. New York has got another one we're going to be at. Tons of startups, a lot of them getting funded, big growth in cloud, big growth in data, security, hot in all sectors. >> Jeff: Absolutely. >> So maybe we could just start with the global startup program. It's essentially a white glove service that we provide to startups that are built on AWS. And the intention there is to help identify use cases that are being built on top of AWS. And for these startups, we want to provide white glove support in co building products together, co-marketing and co-selling. Essentially, the use cases that our customers need solved that either they don't want to build themselves or perhaps more innovative. So the AWS Global Startup Program provides white glove support, dedicated headcount for each one of those pillars. And within our program, we've also provided incentives, programs, go to market activities like the AWS Startup Showcase that we've built for these startups. >> Yeah, by the way, awsstartups.com is the URL. Check it out. Okay, so your partnerships are key. Jeff, what's your role? >> So I'm responsible for leading the overall effort for the AWS Global Startup Program. So I've got a team of partner managers that are located throughout the US managing a few hundred startup ISVs right now. >> Yeah, you got a lot. >> We've got a lot. There's a lot. >> I got to ask a tough question. I'm a startup founder. I got a team. I just got my series A. We're grown and I'm trying to hire people. I'm super busy. What's in it for me? What do you guys bring to the table? I love the white glove service but translate that. What's in it for me? What do I get out of it? What's the story? >> That's a good question. Focus, I think. >> Jeff: Yeah. >> Because we get to see a lot of partners building their businesses on AWS. So from our perspective, helping these partners focus on what do we truly need to build by working backwards from customer feedback. How do we effectively go to market? Because we've seen startups do various things through trial and error and also just messaging. Because oftentimes partners or rather startups try to boil the ocean with many different use cases. So we really help them sort of laser focus on what are you really good at and how can we bring that to the customer as quickly as possible? >> Yeah, it's truly about helping that founder accelerate the growth of their company. And there's a lot that you can do with AWS but focus is truly the key word there because they're going to be able to find their little piece of real estate and absolutely deliver incredible outcomes for our customers and then they can start their growth curve there. >> What are some of the coolest things you've seen with the APN that you can share publicly? I know you got a lot going on there, a lot of confidentiality, but we're here, a lot of great partners on the floor here. I'm glad we're back at events, a lot of stuff going on, digitally with virtual stuff and hybrid. What are some of the cool things you guys have seen in the APN that you can point to? >> Yeah, absolutely. I can point to few, you can take them. So I think what's been fun over the years for me personally, I came from a startup, ran sales at an early stage startup and I went through the whole thing. So I have a deep appreciation for what these guys are going through. And what's been interesting to see for me is taking some of these early stage guys, watching them progress, go public, get acquired, and see that big day. And being able to point to very specific items that we help them to get to that point. And it's just a really fun journey to watch. >> Yeah, and part of the reason why I really love working at the AWS Global Startup Program is working with passionate founders. I just met with a founder today, he's going to build a very big business one day and watching them grow through these stages and supporting that growth, I like to think of our program as a catalyst for enterprise sort of scale. And through that we provide visibility, credibility and growth opportunities. >> A lot of partners too, what I found, talking to staff founders is when they have that milestone, they worked so hard for it. whether it's a B round, C round, or public or get bought. Then they take a deep breath and they look back at, wow what a journey it's been. So it's kind of emotional for sure, but still it's a grind. When you get funding, it's still day one. You don't stop. It's no celebrate, you got a big round or valuation. You still got to execute. >> And look it's hypercompetitive and it's brutally difficult. And our job is to try to make that a little less difficult and navigate those waters where everyone's going after similar things. >> Yeah, and I think as a group element too. I observe that startups that I meet through the APN has been interesting because they feel part of AWS. >> Serge: Totally. >> As a group of community, as a vibe there. I know they're hustling. They're trying to make things happen. But at the same time, Amazon throws a huge halo effect. That's a huge factor. You guys are the number one cloud in the business. The growth and every sector is booming. And if you're a startup, you don't have that luxury yet. And look at companies like Snowflake that built on top of AWS. People are winning by building on AWS. >> Our program really validates their technology first. So we have what's called a foundation's technical review that we put all of our startups through before we go to market. So that when enterprise customers are looking at startup technology, they know that it's already been vetted. And to take that a step further and help these partners differentiate, we use programs like the competency programs, the DevOps competency, the security competency which continues to help provide a platform for these startups, help them differentiate, and also there's go to market benefits that are associated with that. >> So let me ask the question that's probably on everyone's mind who's watching us. Actually, I asked this a lot. There's a lot of companies startups out there. Who makes the cut? Is there a criteria? God, that's not like it's sports team or anything. >> Sure. >> There's activate program, which is like there's hundreds of thousands of startups out there. Not everyone is at the APN. >> Serge: Correct. >> So ISVs, again, that's a whole nother. That's a more mature partner that might have huge market cap or growth. How do you guys focus? How do you guys focus? >> Serge: Good question. >> A thousand flowers blooming all the time. Is there a new way you guys are looking at it? I know there's been some talk about restructure or new focus. What's the focus? >> It's definitely not an easy task by any means but I recently took over this role and we're really trying to establish focus areas. So obviously a lot of the ISVs that we look after are infrastructure ISVs. That's what we do and so we have very specific pods that look after different type of partners. So we've got a security pod, we've got a DevOps pod, we've got core infrastructure, et cetera. And really we're trying to find these ISVs that can solve really interesting AWS customer challenges. >> Do you guys have a deliberate focus on these pillars? So one, infrastructure. >> Security, DevOps and data and analytics and then line of business. >> Line of business, like web marketing solutions. (group chattering) >> Yeah, exactly. >> So solutions there. >> Yeah. More solutions and the other ones are like hardcore. So infrastructure as well like storage, backup, ransomware, kind of stuff. >> Storage, networking. >> Okay, yeah, the classic. >> Database, et cetera. >> And so there's teams on each pillar. >> Yep. So I think what's fascinating for the startups that we cover is that they truly have support from a build market sell perspective. So you've got someone who's technical to really help them get the technology figured out, someone to help them get the marketing message dialed and spread, and then someone to actually do the co-sell day to day activities to help them get in front of customers. >> Probably the number one request that we always ask for Amazon is can we wish that SOC report, oh download it on the console, which we use all the time. >> Exactly. >> But security's a big deal. SREs are evolve in that role of DevOps is taking on DevSecOps. I could see a lot of customers having that need for a relationship to move things faster. Do you guys provide like escalation or is that a part of a service or not part of? >> So the partner development manager can be an escalation point, absolutely. Think of them as an extension of your business inside of AWS. >> Great and you guys, how is that partner managers measured? >> On those three pillars. >> Got it, okay. >> Are we building valuable use cases? So product development. Go to market, so go to market activities. Think blog posts, webinars, case studies, so on and so forth. And then co-sell. Not only are we helping these partners win their current opportunities that they are sourcing, but can we also help them source net new deals? >> Jeff: Yeah. >> That's very important. Top ask from the partners is get me in front of customers. Not an easy task, but that's a huge goal of ours to help them grow their top line. >> In fact, we have some interviews here on theCUBE earlier talking about that dynamic of how enterprise customers are buying. And it's interesting, a lot more POCs. I have one partner here that you guys work with on observability. They got a huge POC with Capital One and the enterprises are engaging the startups and bringing them in. So the combination of open source software, enterprises are leaning into that hard and bringing young growing startups in. So I could see that as a huge service that you guys can bring people in. >> Right and they're bringing massively differentiated technology to the table. The challenge is they just might not have the brand recognition that the big guys have. And so that's our job is how do you get that great tech in front of the right situations. >> So my next question is about the show here and then we'll talk globally. So here in San Francisco, Silicon Valley, bay area, San Francisco bay area, a lot of startups, a lot of VCs, a lot of action. So probably a big marker for you guys. So what's exciting here in SF? And then outside of SF, you guys have a global program. You see any trends that are geography-based or is it areas more mature? There's certain regions that are better. And I just interviewed a company here that's doing AWS Edge really well. It's interesting that the partners are filling a lot of holes and gaps in the opportunities with AWS. So what's exciting here, and then what's the global perspective? >> Yeah, totally. So obviously, a ton of partners from the bay area that we support, but we're seeing a lot of really interesting technology coming out of EMEA specifically. And making a lot of noise here in the United States, which is great. And so we definitely have that global presence and starting to see super differentiated technology come out of those regions. >> Yeah, especially Tel Aviv. >> Yeah. >> EMEA real quick before you get into surge. It's interesting. The VC market in Europe is hot. They've got a lot of unicorns coming in. We've seen a lot of companies coming in. They're kind of rattling their own cage right now. Hey, look at us. Let's see if they crash, but we don't see that happening. I mean, people have been predicting a crash now in the startup ecosystem for at least a year. It's not crashing. In fact, funding's up. >> The pandemic was hard on a lot of startups for sure. >> Jeff: Yeah. >> But what we've seen is many of these startups, as quickly as they can grow, they can also pivot as well. And so I've actually seen many of our startups grow through the pandemic because their use cases are helping customers either save money, become more operationally efficient, and provide value to leadership teams that need more visibility into their infrastructure during a pandemic. >> It's an interesting point. I talked to Andy Jassy and Adam Selipsky both say the same thing during the pandemic. Necessity is the mother of all invention. And startups can move fast. So with that, you guys are there to assist. If I'm a startup and I got to pivot, 'cause remember iterate and pivot, iterate and pivot so you get your economics. That's the playbook of the ventures and the models. >> Yeah, exactly. >> How do you guys help me do that? Give an example, walk me through. Pretend me I'm a startup. Hey, I am on the cloud. Oh my God, pandemic. They need video conferencing. Hey CUBE, what do I need? Serge, what do I do? >> That's a good question. First thing is just listen. I think what we have to do is a really good job of listening to the partner. What are their needs? What is their problem statement and where do they want to go at the end of the day? And oftentimes because we've worked with so many successful startups that have come out of our program, we of either through intuition or a playbook determine what is going to be the best path forward and how do we get these partners to stop focusing on things that will eventually just be a waste of time and or not provide or bring any fruit to the table, which essentially revenue. >> Well, we love startups here in theCUBE because one, they have good stories, they're on cutting edge, always pushing the envelope, and they're kind of disrupting someone else. And so they usually have an opinion they don't mind sharing on camera. So love talking to startups. We love working with you guys on our Startup Showcase, awsstartups.com. Check out awsstartups.com and check out the showcases. Final word, I'll give you guys the last word. What's the bottom line, bumper sticker for the global APN program? Summarize the opportunity for startups, what you guys bring to the table and we'll close it out. Jeff, we'll start with you. >> Totally, yeah. I think the AWS Global Startup Program's here to help companies truly accelerate their business, full stop. And that's what we're here for. >> I love it. It's a good way to put it. >> Ditto? >> Yeah. >> All right. Serge, Jeff, thanks for coming on. >> Thanks John. >> Great to see you. Love working with you guys. Hey, startups need help and the growing and huge market opportunities, the shift cloud scale, data engineering, security, infrastructure, all the markets are exploding in growth because of the digital transformation of realities here, open source and cloud. All making it happen here in theCUBE in San Francisco, California. I'm John Furrier your host. Thanks for watching. >> Let's go, John. (soft music)

from the cube studios in palo alto in boston bringing you data driven insights from the cube and etr this is breaking analysis with dave vellante recent survey data from etr shows that enterprise tech spending is tracking with projected u.s gdp growth at six to seven percent this year many markers continue to point the way to a strong recovery including hiring trends and the loosening of frozen it project budgets however skills shortages are blocking progress at some companies which bodes well for an increased reliance on external i.t services moreover while there's much to talk about well there's much talk about the rotation out of work from home plays and stocks such as video conferencing vdi and other remote worker tech we see organizations still trying to figure out the ideal balance between funding headquarter investments that have been neglected and getting hybrid work right in particular the talent gap combined with a digital mandate means companies face some tough decisions as to how to fund the future while serving existing customers and transforming culturally hello everyone and welcome to this week's wikibon cube insights powered by etr in this breaking analysis we welcome back eric porter bradley of etr who will share fresh data perspectives and insights from the latest survey data eric great to see you welcome thank you very much dave always good to see you and happy to be on the show again okay we're going to share some macro data and then we're going to dig into some highlights from etr's most recent march covid survey and also the latest april data so eric the first chart that we want to show it shows cio and it buyer responses to expected i.t spend for each quarter of 2021 versus 2020. and you can see here a steady quarterly improvement eric what are the key takeaways from your perspective sure well first of all for everyone out there this particular survey had a record-setting number of uh participation we had uh 1 500 i.t decision makers participate and we had over half of the fortune 500 and over a fifth of the global 1000. so it was a really good survey this is the seventh iteration of the covet impact survey specifically and this is going to transition to an over large macro survey going forward so we could continue it and you're 100 right what we've been tracking here since uh march of last year was how is spending being impacted because of covid where is it shifting and what we're seeing now finally is that there is a real re-acceleration in spend i know we've been a little bit more cautious than some of the other peers out there that just early on slapped an eight or a nine percent number but what we're seeing is right now it's at a midpoint of over six uh about six point seven percent and that is accelerating so uh we are still hopeful that that will continue uh really that spending is going to be in the second half of the year as you can see on the left part of this chart that we're looking at uh it was about 1.7 versus 3 for q1 spending year over year so that is starting to accelerate through the back half you know i think it's prudent to be be cautious relative because normally you'd say okay tech is going to grow a couple of points higher than gdp but it's it's really so hard to predict this year okay the next chart is here that we want to show you is we ask respondents to indicate what strategies they're employing in the short term as a result of coronavirus and you can see a few things that i'll call out and then i'll ask eric to chime in first there's been no meaningful change of course no surprise in tactics like remote work and halting travel however we're seeing very positive trends in other areas trending downward like hiring freezes and freezing i.t deployments downward trend in layoffs and we also see an increase in the acceleration of new i.t deployments and in hiring eric what are your key takeaways well first of all i think it's important to point out here that uh we're also capturing that people believe remote work productivity is still increasing now the trajectory might be coming down a little bit but that is really key i think to the backdrop of what's happening here so people have a perception that productivity of remote work is better than hybrid work and that's from the i.t decision makers themselves um but what we're seeing here is that uh most importantly these organizations are citing plans to increase hiring and that's something that i think is really important to point out it's showing a real thawing and to your point in right in the beginning of the intro uh we are seeing deployments stabilize versus prior survey levels which means early on they had no plans to launch new tech deployments then they said nope we're going to start and now that's stalling and i think it's exactly right what you said is there's an i.t skills shortage so people want to continue to do i.t deployments because they have to support work from home and a hybrid back return to the office but they just don't have the skills to do so and i think that's really probably the most important takeaway from this chart um is that stalling and to really ask why it's stalling yeah so we're going to get into that for sure and and i think that's a really key point is that that that accelerating it deployments is some it looks like it's hit a wall in the survey and so but before before we get deep into the skills let's let's take a look at this next chart and we're asking people here how a return to the new normal if you will and back to offices is going to change spending with on-prem architectures and applications and so the first two bars they're cloud-friendly if you add them up at 63 percent of the respondents say that either they'll stay in the cloud for the most part or they're going to lower the on-prem spend when they go back to the office the next three bars are on-prem friendly if you add those up as 29 percent of the respondents say their on-prem spend is going to bounce back to pre-covert levels or actually increase and of course 12 percent of that number by the way say they they've never altered their on-prem spend so eric no surprise but this bodes well for cloud but but it it isn't it also a positive for on-prem this we've had this dual funding premise meaning cloud continues to grow but neglected data center spend also gets a boost what's your thoughts you know really it's interesting it's people are spending on all fronts you and i were talking in a prep it's like you know we're we're in battle and i've got naval i've got you know air i've got land uh i've got to spend on cloud and digital transformation but i also have to spend for on-prem uh the hybrid work is here and it needs to be supported so this spending is going to increase you know when you look at this chart you're going to see though that roughly 36 percent of all respondents say that their spending is going to remain mostly on cloud so this you know that is still the clear direction uh digital transformation is still happening covid accelerated it greatly um you know you and i as journalists and researchers already know this is where the puck is going uh but spend has always lagged a little bit behind because it just takes some time to get there you know inversely 27 said that their on-prem spending will decrease so when you look at those two i still think that the trend is the friend for cloud spending uh even though yes they do have to continue spending on hybrid some of it's been neglected there are refresh cycles coming up so overall it just points to more and more spending right now it really does seem to be a very strong backdrop for it growth so i want to talk a little bit about the etr taxonomy before we bring up the next chart we get a lot of questions about this and of course when you do a massive survey like you're doing you have to have consistency for time series so you have to really think through what that what the buckets look like if you will so this next chart takes a look at the etr taxonomy and it breaks it down into simple to understand terms so the green is the portion of spending on a vendor's tech within a category that is accelerating and the red is the portion that is decelerating so eric what are the key messages in this data well first of all dave thank you so much for pointing that out we used to do uh just what we call a next a net score it's a proprietary formula that we use to determine the overall velocity of spending some people found it confusing um our data scientists decided to break this sector breakdown into what you said which is really more of a mode analysis in that sector how many of the vendors are increasing versus decreasing so again i just appreciate you bringing that up and allowing us to explain the the the reasoning behind our analysis there but what we're seeing here uh goes back to something you and i did last year when we did our predictions and that was that it services and consulting was going to have a true rebound in 2021 and that's what this is showing right here so in this chart you're going to see that consulting and services are really continuing their recovery uh 2020 had a lot of declines and they have the biggest sector over year-over-year acceleration sector-wise the other thing to point out in this which we'll get to again later is that the inverse analysis is true for video conferencing uh we will get to that so i'm going to leave a little bit of ammunition behind for that one but what we're seeing here is it consulting services being the real favorable and video conferencing uh having a little bit more trouble great okay and then let's let's take a look at that services piece and this next chart really is a drill down into that space and emphasizes eric what you were just talking about and we saw this in ibm's earnings where still more than 60 percent of ibm's business comes from services and the company beat earnings you know in part due to services outperforming expectations i think it had a somewhat easier compare and some of this pen-up demand that we've been talking about bodes well for ibm and in other services companies it's not just ibm right eric no it's not but again i'm going to point out that you and i did point out ibm in our in our predictions one we did in late december so it is nice to see one of the reasons we don't have a more favorable rating on ibm at the moment is because they are in the the process of spinning out uh this large unit and so there's a little bit of you know corporate action there that keeps us off on the sideline but i would also want to point out here uh tata infosys and cognizant because they're seeing year-over-year acceleration in both it consulting and outsourced i t services so we break those down separately and those are the three names that are seeing acceleration in both of those so again a tata emphasis and cognizant are all looking pretty well positioned as well so we've been talking a little bit about this skill shortage and this is what's i think so hard for for forecasters um is that you know on the one hand there's a lot of pent up demand you know it's like scott gottlieb said it's like woodstock coming out of the covid uh but on the other hand if you have a talent gap you've got to rely on external services so there's a learning curve there's a ramp up it's an external company and so it takes time to put those together so so this data that we're going to show you next uh is is really important in my view and ties what we're saying we're saying at the top it asks respondents to comment on their staffing plans the light blue is we're increasing staff the gray is no change in the magenta or whatever whatever color that is that sort of purplish color anyway that color is is decreasing and the picture is very positive across the board full-time staff offshoring contract employees outsourced professional services all up trending upwards and this eric is more evidence of the services bounce back yeah it certainly is david and what happened is when we caught this trend we decided to go one level deeper and say all right we're seeing this but we need to know why and that's what we always try to do here data will tell you what's happening it doesn't always tell you why and that's one of the things that etr really tries to dig in with through the insights interviews panels and also going direct with these more custom survey questions uh so in this instance i think the real takeaway is that 30 of the respondents said that their outsourced and managed services are going to increase over the next three months that's really powerful that's a large portion of organizations in a very short time period so we're capturing that this acceleration is happening right now and it will be happening in real time and i don't see it slowing down you and i are speaking about we have to you know increase cloud spend we have to increase hybrid spend there are refresh cycles coming up and there's just a real skill shortage so this is a long-term setup that bodes very well for it services and consulting you know eric when i came out of college i somebody told me read read read read as much as you can and and so i would and they said read the wall street journal every day and i so i did it and i would read the tech magazines and back then it was all paper and what happens is you begin to connect the dots and so the reason i bring that up is because i've now been had taken a bath in the etr data for the better part of two years and i'm beginning to be able to connect the dots you know the data is not always predictive but many many times it is and so this next data gets into the fun stuff where we name names a lot of times people don't like it because the marketing people and organizations say well the data's wrong of course that's the first thing they do is attack the data but you and i know we've made some really great calls work from home for sure you're talking about the services bounce back uh we certainly saw the rise of crowdstrike octa zscaler well before people were talking about that same thing with video conferencing and so so anyway this is the fun stuff and it looks at positive versus negative sentiment on on companies so first how does etr derive this data and how should we interpret it and what are some of your takeaways [Music] sure first of all how we derive the data or systematic um survey responses that we do on a quarterly basis and we standardize those responses to allow for time series analysis so we can do trend analysis as well we do find that our data because it's talking about forward-looking spending intentions is really more predictive because we're talking about things that might be happening six months three months in the future not things that a lot of other competitors and research peers are looking at things that already happened uh they're looking in the past etr really likes to look into the future and our surveys are set up to do so so thank you for that question it's an enjoyable lead-in but to get to the fun stuff like you said uh what we do here is we put ratings on the data sets i do want to put the caveat out there that our spending intentions really only captures top-line revenue it is not indicative of profit margin or any other line items so this is only going to be viewed as what we are rating the data set itself not the company um you know that's not what we're in the game of doing so i think that's very important for the marketing and the vendors out there themselves when they when they take a look at this we're just talking about what we can control which is our data we're going to talk about a few of the names here on this highlighted vendors list one we're going to go back to that you and i spoke about i guess about six months ago or maybe even earlier which was the observability space um you and i were noticing that it was getting very crowded a lot of new entrants um there was a lot of acquisition from more of the legacy or standard entrance players in the space and that is continuing so i think in a minute we're going to move into that observability space but what we're seeing there is that it's becoming incredibly crowded and we're possibly seeing signs of them cannibalizing each other uh we're also going to move on a little bit into video conferencing where we're capturing some spend deceleration and then ultimately we're going to get into a little bit of a storage refresh cycle and talk about that but yeah these are the highlighted vendors for april um we usually do this once a quarter and they do change based on the data but they're not usually whipsawed around the data doesn't move that quickly yeah so you can see the some of the big names on the left-hand side some of the sas companies that have momentum obviously servicenow has been doing very very well we've talked a lot about snowflake octa crowdstrike z scalar in all very positive as well as you know several others i i guess i'd add some some things i mean i think if thinking about the next decade it's it's cloud which is not going to be like the same cloud as last decade a lot of machine learning and deep learning and ai and the cloud is extending to the edge in the data center data obviously very important data is decentralized and distributed so data architectures are changing a lot of opportunities to connect across clouds and actually create abstraction layers and then something that we've been covering a lot is processor performance is actually accelerating relative to moore's law it's probably instead of doubling every two years it's quadrupling every two years and so that is a huge factor especially as it relates to powering ai and ai inferencing at the edge this is a whole new territory custom silicon is is really becoming in vogue uh and so we're something that we're watching very very closely yeah i completely completely agree on that and i do think that the the next version of cloud will be very different another thing to point out on that too is you can't do anything that you're talking about without collecting the data and and organizations are extremely serious about that now it seems it doesn't matter what industry they're in every company is a data company and that also bodes well for the storage call we do believe that there is going to just be a huge increase in the need for storage um and yes hopefully that'll become portable across multi-cloud and hybrid as well now as eric said the the etr data's it's it's really focused on that top line spend so if you look at the uh on on the right side of that chart you saw you know netapp was kind of negative was very negative right but there's a company that's in in transformation now they've lowered expectations and they've recently beat expectations that's why the stock has been doing better but but at the macro from a spending standpoint it's still challenged so you have big footprint companies like netapp and oracle is another one oracle's stock is at an all-time high but the spending relative to sort of previous cycles or relative to you know like for instance snowflake much much smaller not as high growth but they're managing expectations they're managing their transition they're managing profitability zoom is another one zoom looking looking negative but you know zoom's got to use its market cap now to to transform and increase its tam uh and then splunk is another one we're going to talk about splunk is in transition it acquired signal fx it just brought on this week teresa carlson who was the head of aws public sector she's the president and head of sales so they've got a go to market challenge and they brought in teresa carlson to really solve that but but splunk has been trending downward we called that you know several quarters ago eric and so i want to bring up the data on splunk and this is splunk eric in analytics and it's not trending in the right direction the green is accelerating span the red is and the bars is decelerating spend the top blue line is spending velocity or net score and the yellow line is market share or pervasiveness in the data set your thoughts yeah first i want to go back is a great point dave about our data versus a disconnect from an equity analysis perspective i used to be an equity analyst that is not what we do here and you you may the main word you said is expectations right stocks will trade on how they do compared to the expectations that are set uh whether that's buy side expectations sell side expectations or management's guidance themselves we have no business in tracking any of that what we are talking about is top line acceleration or deceleration so uh that was a great point to make and i do think it's an important one for all of our listeners out there now uh to move to splunk yes i've been capturing a lot of negative commentary on splunk even before the data turned so this has been about a year-long uh you know our analysis and review on this name and i'm dating myself here but i know you and i are both rock and roll fans so i'm gonna point out a led zeppelin song and movie and say that the song remains the same for splunk we are just seeing uh you know recent spending intentions are taking yet another step down both from prior survey levels from year ago levels uh this we're looking at in the analytics sector and spending intentions are decelerating across every single customer group if we went to one of our other slide analysis um on the etr plus platform and you do by customer sub sample in analytics it's dropping in every single vertical it doesn't matter which one uh it's really not looking good unfortunately and you had mentioned this as an analytics and i do believe the next slide is an information security yeah let's bring that up and it's unfortunately it's not doing much better so this is specifically fortune 500 accounts and information security uh you know there's deep pockets in the fortune 500 but from what we're hearing in all the insights and interviews and panels that i personally moderate for etr people are upset they didn't like the the strong tactics that splunk has used on them in the past they didn't like the ingestion model pricing the inflexibility and when alternatives came along people are willing to look at the alternatives and that's what we're seeing in both analytics and big data and also for their sim in security yeah so i think again i i point to teresa carlson she's got a big job but she's very capable she's gonna she's gonna meet with a lot of customers she's a go to market pro she's gonna have to listen hard and i think you're gonna you're gonna see some changes there um okay so there's more sorry there's more bad news on splunk so bring this up is is is net score for splunk in elastic accounts uh this is for analytics so there's 106 elastic accounts that uh in the data set that also have splunk and it's trending downward for splunk that's why it's green for elastic and eric the important call out from etr here is how splunk's performance in elastic accounts compares with its performance overall the elk stack which obviously elastic is a big part of that is causing pain for splunk as is data dog and you mentioned the pricing issue uh is it is it just well is it pricing in your assessment or is it more fundamental you know it's multi-level based on the commentary we get from our itdms that take the survey so yes you did a great job with this analysis what we're looking at is uh the spending within shared accounts so if i have splunk already how am i spending i'm sorry if i have elastic already how is my spending on splunk and what you're seeing here is it's down to about a 12 net score whereas splunk overall has a 32 net score among all of its customers so what you're seeing there is there is definitely a drain that's happening where elastic is draining spend from splunk and usage from them uh the reason we used elastic here is because all observabilities the whole sector seems to be decelerating splunk is decelerating the most but elastic is the only one that's actually showing resiliency so that's why we decided to choose these two but you pointed out yes it's also datadog datadog is cloud native uh they're more devops oriented they tend to be viewed as having technological lead as compared to splunk so that's a really good point a dynatrace also is expanding their abilities and splunk has been making a lot of acquisitions to push their cloud services they are also changing their pricing model right they're they're trying to make things a little bit more flexible moving off ingestion um and moving towards uh you know consumption so they are trying and the new hires you know i'm not gonna bet against them because the one thing that splunk has going for them is their market share in our survey they're still very well entrenched so they do have a lot of accounts they have their foothold so if they can find a way to make these changes then they you know will be able to change themselves but the one thing i got to say across the whole sector is competition is increasing and it does appear based on commentary and data that they're starting to cannibalize themselves it really seems pretty hard to get away from that and you know there are startups in the observability space too that are going to be you know even more disruptive i think i think i want to key on the pricing for a moment and i've been pretty vocal about this i think the the old sas pricing model where essentially you essentially lock in for a year or two years or three years pay up front or maybe pay quarterly if you're lucky that's a one-way street and i think it's it's a flawed model i like what snowflake's doing i like what datadog's doing look at what stripe is doing look what twilio is doing these are cons you mentioned it because it's consumption based pricing and if you've got a great product put it out there and you know damn the torpedoes and i think that is a game changer i i look at for instance hpe with green lake i look at dell with apex they're trying to mimic that model you know they're there and apply it to to infrastructure it's much harder with infrastructure because you got to deploy physical infrastructure but but that is a model that i think is going to change and i think all of the traditional sas pricing is going to is going to come under disruption over the next you know better part of the decades but anyway uh let's move on we've we've been covering the the apm space uh pretty extensively application performance management and this chart lines up some of the big players here comparing net score or spending momentum from the april 20th survey the gray is is um is sorry the the the gray is the april 20th survey the blue is jan 21 and the yellow is april 21. and not only are elastic and data dog doing well relative to splunk eric but everything is down from last year so this space as you point out is undergoing a transformation yeah the pressures are real and it's you know it's sort of that perfect storm where it's not only the data that's telling us that but also the direct feedback we get from the community uh pretty much all the interviews i do i've done a few panels specifically on this topic for anyone who wants to you know dive a little bit deeper we've had some experts talk about this space and there really is no denying that there is a deceleration in spend and it's happening because that spend is getting spread out among different vendors people are using you know a data dog for certain aspects they're using elastic where they can because it's cheaper they're using splunk because they have to but because it's so expensive they're cutting some of the things that they're putting into splunk which is dangerous particularly on the security side if i have to decide what to put in and whatnot that's not really the right way to have security hygiene um so you know this space is just getting crowded there's disruptive vendors coming from the emerging space as well and what you're seeing here is the only bit of positivity is elastic on a survey over survey basis with a slight slight uptick everywhere else year over year and survey over survey it's showing declines it's just hard to ignore and then you've got dynatrace who based on the the interviews you do in the venn you're you know one on one or one on five you know the private interviews that i've been invited to dynatrace gets very high scores uh for their road map you've got new relic which has been struggling you know financially but they've got a purpose built they've got a really good product and a purpose-built database just for this apm space and then of course you've got cisco with appd which is a strong business for them and then as you mentioned you've got startups coming in you've got chaos search which ed walsh is now running you know leave the data in place in aws and really interesting model honeycomb it's going to be really disruptive jeremy burton's company observed so this space is it's becoming jump ball yeah there's a great line that came out of one of them and that was that the lines are blurring it used to be that you knew exactly that app dynamics what they were doing it was apm only or it was logging and monitoring only and a lot of what i'm hearing from the itdm experts is that the lines are blurring amongst all of these names they all have functionality that kind of crosses over each other and the other interesting thing is it used to be application versus infrastructure monitoring but as you know infrastructure is becoming code more and more and more and as infrastructure becomes code there's really no difference between application and infrastructure monitoring so we're seeing a convergence and a blurring of the lines in this space which really doesn't bode well and a great point about new relic their tech gets good remarks uh i just don't know if their enterprise level service and sales is up to snuff right now um as one of my experts said a cto of a very large public online hospitality company essentially said that he would be shocked that within 18 months if all of these players are still uh standalone that there needs to be some m a or convergence in this space okay now we're going to call out some of the data that that really has jumped out to etr in the latest survey and some of the names that are getting the most queries from etr clients which are many of which are investor clients so let's start by having a look at one of the most important and prominent work from home names zoom uh let's let's look at this eric is the ride over for zoom oh i've been saying it for a little bit of a time now actually i do believe it is um i will get into it but again pointing out great dave uh the reason we're presenting today splunk elastic and zoom are they are the most viewed on the etr plus platform uh trailing behind that only slightly is f5 i decided not to bring f5 to the table today because we don't have a rating on the data set um so then i went one deep one below that and it's pure so the reason we're presenting these to you today is that these are the ones that our clients and our community are most interested in which is hopefully going to gain interest to your viewers as well so to get to zoom um yeah i call zoom the pandec pandemic bull market baby uh this was really just one that had a meteoric ride you look back january in 2020 the stock was at 60 and 10 months later it was like like 580. that's in 10 months um that's cooled down a little bit uh into the mid 300s and i believe that cooling down should continue and the reason why is because we are seeing a huge deceleration in our spending intentions uh they're hitting all-time lows it's really just a very ugly data set um more importantly than the spending intentions for the first time we're seeing customer growth in our survey flattened in the past we could we knew that the the deceleration and spend was happening but meanwhile their new customer growth was accelerating so it was kind of hard to really make any call based on that this is the first time we're seeing flattening customer growth trajectory and that uh in tandem with just dominance from microsoft in every sector they're involved in i don't care if it's ip telephony productivity apps or the core video conferencing microsoft is just dominating so there's really just no way to ignore this anymore the data and the commentary state that zoom is facing some headwinds well plus you've pointed out to me that a lot of your private conversations with buyers says that hey we're we're using the freebie version of zoom you know we're not paying them and so in that combined with teams i mean it's it's uh it's i think you know look zoom has to figure it out they they've got to they've got to figure out how to use their elevated market cap to transform and expand their tan um but let's let's move on here's the data on pure storage and we've highlighted a number of times this company is showing elevated spending intentions um pure announces earnings in in may ibm uh just announced storage what uh it was way down actually so sort of still pure more positive but i'll comment on a moment but what does this data tell you eric yeah you know right now we started seeing this data last survey in january and that was the first time we really went positive on the data set itself and it's just really uh continuing so we're seeing the strongest year-over-year acceleration in the entire survey um which is a really good spot to be pure is also a leading position in among its sector peers and the other thing that was pretty interesting from the data set is among all storage players pure has the highest positive public cloud correlation so what we can do is we can see which respondents are accelerating their public cloud spend and then cross-reference that with their storage spend and pure is best positioned so as you and i both know uh you know digital transformation cloud spending is increasing you need to be aligned with that and among all storage uh sector peers uh pure is best positioned in all of those in spending intentions and uh adoptions and also public cloud correlation so yet again just another really strong data set and i have an anecdote about why this might be happening because when i saw the date i started asking in my interviews what's going on here and there was one particular person he was a director of cloud operations for a very large public tech company now they have hybrid um but their data center is in colo so they don't own and build their own physical building he pointed out that doran kovid his company wanted to increase storage but he couldn't get into his colo center due to covert restrictions they weren't allowed you had so 250 000 square feet right but you're only allowed to have six people in there so it's pretty hard to get to your rack and get work done he said he would buy storage but then the cola would say hey you got to get it out of here it's not even allowed to sit here we don't want it in our facility so he has all this pent up demand in tandem with pent up demand we have a refresh cycle the ssd you know depreciation uh you know cycle is ending uh you know ssds are moving on and we're starting to see uh new technology in that space nvme sorry for technology increasing in that space so we have pent up demand and we have new technology and that's really leading to a refresh cycle and this particular itdm that i spoke to and many of his peers think this has a long tailwind that uh storage could be a good sector for some time to come that's really interesting thank you for that that extra metadata and i want to do a little deeper dive on on storage so here's a look at storage in the the industry in context and some of the competitive i mean it's been a tough market for the reasons that we've highlighted cloud has been eating away that flash headroom it used to be you'd buy storage to get you know more spindles and more performance and you were sort of forced to buy more flash gave more headroom but it's interesting what you're saying about the depreciation cycle so that's good news so etr combines just for people's benefit here combines primary and secondary storage into a single category so you have companies like pure and netapp which are really pure play you know primary storage companies largely in the sector along with veeam cohesity and rubric which are kind of secondary data or data protection so my my quick thoughts here are that pure is elevated and remains what i call the one-eyed man in the land of the blind but that's positive tailwinds there so that's good news rubric is very elevated but down it's a big it's big competitor cohesity is way off its highs and i have to say to me veeam is like the steady eddy consistent player here they just really continue to do well in the data protection business and and the highs are steady the lows are steady dell is also notable they've been struggling in storage their isg business which comprises service and storage it's been soft during covid and and during even you know this new product rollout so it's notable with this new mid-range they have in particular the uptick in dell this survey because dell so large a small uptick can be very good for dell hpe has a big announcement next month in storage so that might improve based on a product cycle of course the nimble brand continues to do well ibm as i said just announced a very soft quarter you know down double digits again uh and there in a product cycle shift and netapp is that looks bad in the etr data from a spending momentum standpoint but their management team is transforming the company into a cloud play which eric is why it was interesting that pure has the greatest momentum in in cloud accounts so that is sort of striking to me i would have thought it would be netapp so that's something that we want to pay attention to but i do like a lot of what netapp is doing uh and other than pure they're the only big kind of pure play in primary storage so long winded uh uh intro there eric but anything you'd add no actually i appreciate it was long winded i i'm going to be honest with you storage is not my uh my best sector as far as a researcher and analyst goes uh but i actually think a lot of what you said is spot on um you know we do capture a lot of large organizations spend uh we don't capture much mid and small so i think when you're talking about these large large players like netapp and um you know not looking so good all i would state is that we are capturing really big organizations spending attention so these are names that should be doing better to be quite honest uh in those accounts and you know at least according to our data we're not seeing it and it's long-term depression as you can see uh you know netapp now has a negative spending velocity in this analysis so you know i can go dig around a little bit more but right now the names that i'm hearing are pure cohesity uh um i'm hearing a little bit about hitachi trying to reinvent themselves in the space but you know i'll take a wait-and-see approach on that one but uh pure and cohesity are the ones i'm hearing a lot from our community so storage is transforming to cloud as a service you're seeing things like apex and in green lake from dell and hpe and container storage little so not really a lot of people paying attention to it but pure about a company called portworx which really specializes in container storage and there's many startups there they're trying to really change the way david flynn has a startup in that space he's the guy who started fusion i o so a lot a lot of transformations happening here okay i know it's been a long segment we have to summarize and then let me go through a summary and then i'll give you the last word eric so tech spending appears to be tracking us gdp at six to seven percent this talent shortage could be a blocker to accelerating i.t deployments and that's kind of good news actually for for services companies digital transformation you know it's it remains a priority and that bodes well not only for services but automation uipath went public this week we we profiled that you know extensively that went public last wednesday um organizations they've i said at the top face some tough decisions on how to allocate resources you know running the business growing the business transforming the business and we're seeing a bifurcation of spending and some residual effects on vendors and that remains a theme that we're watching eric your final thoughts yeah i'm going to go back quickly to just the overall macro spending because there's one thing i think is interesting to point out and we're seeing a real acceleration among mid and small so it seems like early on in the covid recovery or kovitz spending it was the deep pockets that moved first right fortune 500 knew they had to support remote work they started spending first round that in the fortune 500 we're only seeing about five percent spent but when you get into mid and small organizations that's creeping up to eight nine so i just think it's important to point out that they're playing catch-up right now uh also would point out that this is heavily skewed to north america spending we're seeing laggards in emea they just don't seem to be spending as much they're in a very different place in their recovery and uh you know i do think that it's important to point that out um lastly i also want to mention i know you do such a great job on following a lot of the disruptive vendors that you just pointed out pure doing container storage we also have another bi-annual survey that we do called emerging technology and that's for the private names that's going to be launching in may for everyone out there who's interested in not only the disruptive vendors but also private equity players uh keep an eye out for that we do that twice a year and that's growing in its respondents as well and then lastly one comment because you mentioned the uipath ipo it was really hard for us to sit on the sidelines and not put some sort of rating on their data set but ultimately um the data was muted unfortunately and when you're seeing this kind of hype into an ipo like we saw with snowflake the data was resoundingly strong we had no choice but to listen to what the data said for snowflake despite the hype um we didn't see that for uipath and we wanted to and i'm not making a large call there but i do think it's interesting to juxtapose the two that when snowflake was heading to its ipo the data was resoundingly positive and for uipath we just didn't see that thank you for that and eric thanks for coming on today it's really a pleasure to have you and uh so really appreciate the the uh collaboration and look forward to doing more of these we enjoy the partnership greatly dave we're very very happy to have you in the etr family and looking forward to doing a lot lot more with you in the future ditto okay that's it for today remember these episodes are all available as podcasts wherever you listen all you got to do is search breaking analysis podcast and please subscribe to the series check out etr's website it's etr dot plus we also publish a full report every week on wikibon.com at siliconangle.com you can email me david.velante at siliconangle.com you can dm me on twitter at dvalante or comment on our linkedin post i could see you in clubhouse this is dave vellante for eric porter bradley for the cube insights powered by etr have a great week stay safe be well and we'll see you next time

>> From theCUBE studios in Palo Alto and Boston, Bringing you data-driven insights from theCUBE and ETR. This is "Breaking Analysis" with Dave Vellante. >> Recent survey data from ETR shows that enterprise tech spending is tracking with projected US GDP growth at six to 7% this year. Many markers continue to point the way to a strong recovery, including hiring trends and the loosening of frozen IT Project budgets. However skills shortages are blocking progress at some companies which bodes well for an increased reliance on external IT services. Moreover, while there's much talk about the rotation out of work from home plays and stocks such as video conferencing, VDI, and other remote worker tech, we see organizations still trying to figure out the ideal balance between funding headquarter investments that have been neglected and getting hybrid work right. In particular, the talent gap combined with a digital mandate, means companies face some tough decisions as to how to fund the future while serving existing customers and transforming culturally. Hello everyone, and welcome to this week's Wikibon CUBE's Insights powered by ETR. In this "Breaking Analysis", we welcome back Erik Porter Bradley of ETR who will share fresh data, perspectives and insights from the latest survey data. Erik, great to see you. Welcome. >> Thank you very much, Dave. Always good to see you and happy to be on the show again. >> Okay, we're going to share some macro data and then we're going to dig into some highlights from ETR's most recent March COVID survey and also the latest April data. So Erik, the first chart that we want to show, it shows CIO and IT buyer responses to expected IT spend for each quarter of 2021 versus 2020, and you can see here a steady quarterly improvement. Erik, what are the key takeaways, from your perspective? >> Sure, well, first of all, for everyone out there, this particular survey had a record-setting number of participation. We had a 1,500 IT decision makers participate and we had over half of the Fortune 500 and over a fifth of the Global 1000. So it was a really good survey. This is seventh iteration of the COVID Impact Survey specifically, and this is going to transition to an overlarge macro survey going forward so we can continue it. And you're 100% right, what we've been tracking here since March of last year was, how is spending being impacted because of COVID? Where is it shifting? And what we're seeing now finally is that there is a real re-acceleration in spend. I know we've been a little bit more cautious than some of the other peers out there that just early on slapped an eight or a 9% number, but what we're seeing is right now, it's at a midpoint of over six, about 6.7% and that is accelerating. So, we are still hopeful that that will continue, and really, that spending is going to be in the second half of the year. As you can see on the left part of this chart that we're looking at, it was about 1.7% versus 3% for Q1 spending year-over-year. So that is starting to accelerate through the back half. >> I think it's prudent to be cautious (indistinct) 'cause normally you'd say, okay, tech is going to grow a couple of points higher than GDP, but it's really so hard to predict this year. Okay, the next chart here that we want to show you is we asked respondents to indicate what strategies they're employing in the short term as a result of coronavirus and you can see a few things that I'll call out and then I'll ask Erik to chime in. First, there's been no meaningful change of course, no surprise in tactics like remote work and holding travel, however, we're seeing very positive trends in other areas trending downward, like hiring freezes and freezing IT deployments, a downward trend in layoffs, and we also see an increase in the acceleration of new IT deployments and in hiring. Erik, what are your key takeaways? >> Well, first of all, I think it's important to point out here that we're also capturing that people believe remote work productivity is still increasing. Now, the trajectory might be coming down a little bit, but that is really key, I think, to the backdrop of what's happening here. So people have a perception that productivity of remote work is better than hybrid work and that's from the IT decision makers themselves, but what we're seeing here is that, most importantly, these organizations are citing plans to increase hiring, and that's something that I think is really important to point out. It's showing a real following, and to your point right in the beginning of the intro, we are seeing deployments stabilize versus prior survey levels, which means early on, they had no plans to launch new tech deployments, then they said, "Nope, we're going to start." and now that stalling, and I think it's exactly right, what you said, is there's an IT skills shortage. So people want to continue to do IT deployments 'cause they have to support work from home and a hybrid back return to the office, but they just don't have the skills to do so, and I think that's really probably the most important takeaway from this chart, is that stalling and to really ask why it's stalling. >> Yeah, so we're going to get into that for sure, and I think that's a really key point, is that accelerating IT deployments, it looks like it's hit a wall in the survey, but before we get deep into the skills, let's take a look at this next chart, and we're asking people here how our return to the new normal, if you will, and back to offices is going to change spending with on-prem architectures and applications. And so the first two bars, they're Cloud-friendly, if you add them up, it's 63% of the respondents, say that either they'll stay in the Cloud for the most part, or they're going to lower their on-prem spend when they go back to the office. The next three bars are on-prem friendly. If you add those up it's 29% of the respondents say their on-prem spend is going to bounce back to pre-COVID levels or actually increase, and of course, 12% of that number, by the way, say they've never altered their on-prem spend. So Erik, no surprise, but this bodes well for Cloud, but isn't it also a positive for on-prem? We've had this dual funding premise, meaning Cloud continues to grow, but neglected data center spend also gets a boost. What's your thoughts? >> Really, it's interesting. It's people are spending on all fronts. You and I were talking in the prep, it's like we're in battle and I've got naval, I've got air, I've got land, I've got to spend on Cloud and digital transformation, but I also have to spend for on-prem. The hybrid work is here and it needs to be supported. So this is spending is going to increase. When you look at this chart, you're going to see though, that roughly 36% of all respondents say that their spending is going to remain mostly on Cloud. So that is still the clear direction, digital transformation is still happening, COVID accelerated it greatly, you and I, as journalists and researchers already know this is where the puck is going, but spend has always lagged a little bit behind 'cause it just takes some time to get there. Inversely, 27% said that their on-prem spending will decrease. So when you look at those two, I still think that the trend is the friend for Cloud spending, even though, yes, they do have to continue spending on hybrid, some of it's been neglected, there are refresh cycles coming up, so, overall it just points to more and more spending right now. It really does seem to be a very strong backdrop for IT growth. >> So I want to talk a little bit about the ETR taxonomy before we bring up the next chart. We get a lot of questions about this, and of course, when you do a massive survey like you're doing, you have to have consistency for time series, so you have to really think through what the buckets look like, if you will. So this next chart takes a look at the ETR taxonomy and it breaks it down into simple-to-understand terms. So the green is the portion of spending on a vendor's tech within a category that is accelerating, and the red is the portion that is decelerating. So Erik, what are the key messages in this data? >> Well, first of all, Dave, thank you so much for pointing that out. We used to do, just what we call a Net score. It's a proprietary formula that we use to determine the overall velocity of spending. Some people found it confusing. Our data scientists decided to break this sector, break down into what you said, which is really more of a mode analysis. In that sector, how many of the vendors are increasing versus decreasing? So again, I just appreciate you bringing that up and allowing us to explain the reasoning behind our analysis there. But what we're seeing here goes back to something you and I did last year when we did our predictions, and that was that IT services and consulting was going to have a true rebound in 2021, and that's what this is showing right here. So in this chart, you're going to see that consulting and services are really continuing their recovery, 2020 had a lot of the clients and they have the biggest sector year-over-year acceleration sector wise. The other thing to point out on this, which we'll get to again later, is that the inverse analysis is true for video conferencing. We will get to that, so I'm going to leave a little bit of ammunition behind for that one, but what we're seeing here is IT consulting services being the real favorable and video conferencing having a little bit more trouble. >> Great, okay, and then let's take a look at that services piece, and this next chart really is a drill down into that space and emphasizes, Erik, what you were just talking about. And we saw this in IBM's earnings, where still more than 60% of IBM's business comes from services and the company beat earnings, in part, due to services outperforming expectations, I think it had a somewhat easier compare and some of this pent-up demand that we've been talking about bodes well for IBM and other services companies, it's not just IBM, right, Erik? >> No, it's not, but again, I'm going to point out that you and I did point out IBM in our predictions when we did in late December, so, it is nice to see. One of the reasons we don't have a more favorable rating on IBM at the moment is because they are in the process of spinning out this large unit, and so there's a little bit of a corporate action there that keeps us off on the sideline. But I would also want to point out here, Tata, Infosys and Cognizant 'cause they're seeing year-over-year acceleration in both IT consulting and outsourced IT services. So we break those down separately and those are the three names that are seeing acceleration in both of those. So again, at the Tata, Infosys and Cognizant are all looking pretty well positioned as well. >> So we've been talking a little bit about this skills shortage, and this is what's, I think, so hard for forecasters, is that in the one hand, There's a lot of pent up demand, Scott Gottlieb said it's like Woodstock coming out of the COVID, but on the other hand, if you have a talent gap, you've got to rely on external services. So there's a learning curve, there's a ramp up, it's an external company, and so it takes time to put those together. So this data that we're going to show you next, is really important in my view and ties what we were saying at the top. It asks respondents to comment on their staffing plans. The light blue is "We're increasing staff", the gray is "No change" and the magenta or whatever, whatever color that is that sort of purplish color, anyway, that color is decreasing, and the picture is very positive across the board. Full-time staff, offshoring, contract employees, outsourced professional services, all up trending upwards, and this Erik is more evidence of the services bounce back. >> Yeah, it's certainly, yes, David, and what happened is when we caught this trend, we decided to go one level deeper and say, all right, we're seeing this, but we need to know why, and that's what we always try to do here. Data will tell you what's happening, it doesn't always tell you why, and that's one of the things that ETR really tries to dig in with through the insights, interviews panels, and also going direct with these more custom survey questions. So in this instance, I think the real takeaway is that 30% of the respondents said that their outsourced and managed services are going to increase over the next three months. That's really powerful, that's a large portion of organizations in a very short time period. So we're capturing that this acceleration is happening right now and it will be happening in real time, and I don't see it slowing down. You and I are speaking about we have to increase Cloud spend, we have to increase hybrid spend, there are refresh cycles coming up, and there's just a real skills shortage. So this is a long-term setup that bodes very well for IT services and consulting. >> You know, Erik, when I came out of college, somebody told me, "Read, read, read, read as much as you can." And then they said, "Read the Wall Street Journal every day." and so I did it, and I would read the tech magazines and back then it was all paper, and what happens is you begin to connect the dots. And so the reason I bring that up is because I've now taken a bath in the ETR data for the better part of two years and I'm beginning to be able to connect the dots. The data is not always predictive, but many, many times it is. And so this next data gets into the fun stuff where we name names. A lot of times people don't like it because they're either marketing people at organizations, say, "Well, data's wrong." because that's the first thing they do, is attack the data. But you and I know, we've made some really great calls, work from home, for sure, you're talking about the services bounce back. We certainly saw the rise of CrowdStrike, Okta, Zscaler, well before people were talking about that, same thing with video conferencing. And so, anyway, this is the fun stuff and it looks at positive versus negative sentiment on companies. So first, how does ETR derive this data and how should we interpret it, and what are some of your takeaways? >> Sure, first of all, how we derive the data, are systematic survey responses that we do on a quarterly basis, and we standardize those responses to allow for time series analysis so we can do trend analysis as well. We do find that our data, because it's talking about forward-looking spending intentions, is really more predictive because we're talking about things that might be happening six months, three months in the future, not things that a lot of other competitors and research peers are looking at things that already happened, they're looking in the past, ETR really likes to look into the future and our surveys are set up to do so. So thank you for that question, It's a enjoyable lead in, but to get to the fun stuff, like you said, what we do here is we put ratings on the datasets. I do want to put the caveat out there that our spending intentions really only captures top-line revenue. It is not indicative of profit margin or any other line items, so this is only to be viewed as what we are rating the data set itself, not the company, that's not what we're in the game of doing. So I think that's very important for the marketing and the vendors out there themselves when they take a look at this. We're just talking about what we can control, which is our data. We're going to talk about a few of the names here on this highlighted vendors list. One, we're going to go back to that you and I spoke about, I guess, about six months ago, or maybe even earlier, which was the observability space. You and I were noticing that it was getting very crowded, a lot of new entrants, there was a lot of acquisition from more of the legacy or standard players in the space, and that is continuing. So I think in a minute, we're going to move into that observability space, but what we're seeing there is that it's becoming incredibly crowded and we're possibly seeing signs of them cannibalizing each other. We're also going to move on a little bit into video conferencing, where we're capturing some spend deceleration, and then ultimately, we're going to get into a little bit of a storage refresh cycle and talk about that. But yeah, these are the highlighted vendors for April, we usually do this once a quarter and they do change based on the data, but they're not usually whipsawed around, the data doesn't move that quickly. >> Yeah, so you can see some of the big names in the left-hand side, some of the SAS companies that have momentum. Obviously, ServiceNow has been doing very, very well. We've talked a lot about Snowflake, Okta, CrowdStrike, Zscaler, all very positive, as well as several others. I guess I'd add some things. I mean, I think if thinking about the next decade, it's Cloud, which is not going to be like the same Cloud as the last decade, a lot of machine learning and deep learning and AI and the Cloud is extending to the edge and the data center. Data, obviously, very important, data is decentralized and distributed, so data architectures are changing. A lot of opportunities to connect across Clouds and actually create abstraction layers, and then something that we've been covering a lot is processor performance is actually accelerating relative to Moore's law. It's probably instead of doubling every two years, it's quadrupling every two years, and so that is a huge factor, especially as it relates to powering AI and AI inferencing at the edge. This is a whole new territory, custom Silicon is really becoming in vogue and so something that we're watching very, very closely. >> Yeah, I completely, agree on that and I do think that the next version of Cloud will be very different. Another thing to point out on that too, is you can't do anything that you're talking about without collecting the data and organizations are extremely serious about that now. It seems it doesn't matter what industry they're in, every company is a data company, and that also bodes well for the storage goal. We do believe that there is going to just be a huge increase in the need for storage, and yes, hopefully that'll become portable across multi-Cloud and hybrid as well. >> Now, as Erik said, the ETR data, it's really focused on that top-line spend. So if you look on the right side of that chart, you saw NetApp was kind of negative, was very negative, right? But it is a company that's in transformation now, they've lowered expectations and they've recently beat expectations, that's why the stock has been doing better, but at the macro, from a spending standpoint, it's still stout challenged. So you have big footprint companies like NetApp and Oracle is another one. Oracle's stock is at an all time high, but the spending relative to sort of previous cycles are relative to, like for instance, Snowflake, much, much smaller, not as high growth, but they're managing expectations, they're managing their transition, they're managing profitability. Zoom is another one, Zoom looking negative, but Zoom's got to use its market cap now to transform and increase its TAM. And then Splunk is another one we're going to talk about. Splunk is in transition, it acquired SignalFX, It just brought on this week, Teresa Carlson, who was the head of AWS Public Sector. She's the president and head of sales, so they've got a go-to-market challenge and they brought in Teresa Carlson to really solve that, but Splunk has been trending downward, we called that several quarters ago, Erik, and so I want to bring up the data on Splunk, and this is Splunk, Erik, in analytics, and it's not trending in the right direction. The green is accelerating spend, the red is in the bars is decelerating spend, the top blue line is spending velocity or Net score, and the yellow line is market share or pervasiveness in the dataset. Your thoughts. >> Yeah, first I want to go back. There's a great point, Dave, about our data versus a disconnect from an equity analysis perspective. I used to be an equity analyst, that is not what we do here. And the main word you said is expectations, right? Stocks will trade on how they do compare to the expectations that are set, whether that's buy-side expectations, sell-side expectations or management's guidance themselves. We have no business in tracking any of that, what we are talking about is the top-line acceleration or deceleration. So, that was a great point to make, and I do think it's an important one for all of our listeners out there. Now, to move to Splunk, yes, I've been capturing a lot of negative commentary on Splunk even before the data turns. So this has been a about a year-long, our analysis and review on this name and I'm dating myself here, but I know you and I are both rock and roll fans, so I'm going to point out a Led Zeppelin song and movie, and say that the song remains the same for Splunk. We are just seeing recent spending attentions are taking yet another step down, both from prior survey levels, from year ago levels. This, we're looking at in the analytics sector and spending intentions are decelerating across every single group, and we went to one of our other slide analysis on the ETR+ platform, and you do by customer sub-sample, in analytics, it's dropping in every single vertical. It doesn't matter which one. it's really not looking good, unfortunately, and you had mentioned this is an analytics and I do believe the next slide is an information security. >> Yeah, let's bring that up. >> And unfortunately it's not doing much better. So this is specifically Fortune 500 accounts and information security. There's deep pockets in the Fortune 500, but from what we're hearing in all the insights and interviews and panels that I personally moderate for ETR, people are upset, that they didn't like the strong tactics that Splunk has used on them in the past, they didn't like the ingestion model pricing, the inflexibility, and when alternatives came along, people are willing to look at the alternatives, and that's what we're seeing in both analytics and big data and also for their SIM and security. >> Yeah, so I think again, I pointed Teresa Carlson. She's got a big job, but she's very capable. She's going to meet with a lot of customers, she's a go-to-market pro, she's going to to have to listen hard, and I think you're going to see some changes there. Okay, so sorry, there's more bad news on Splunk. So (indistinct) bring this up is Net score for Splunk and Elastic accounts. This is for analytics, so there's 106 Elastic accounts in the dataset that also have Splunk and it's trending downward for Splunk, that's why it's green for Elastic. And Erik, the important call out from ETR here is how Splunk's performance in Elastic accounts compares with its performance overall. The ELK stack, which obviously Elastic is a big part of that, is causing pain for Splunk, as is Datadog, and you mentioned the pricing issue, well, is it pricing in your assessment or is it more fundamental? >> It's multi-level based on the commentary we get from our ITDMs teams that take the survey. So yes, you did a great job with this analysis. What we're looking at is the spending within shared accounts. So if I have Splunk already, how am I spending? I'm sorry if I have Elastic already, how am I spending on Splunk? And what you're seeing here is it's down to about a 12% Net score, whereas Splunk overall, has a 32% Net score among all of its customers. So what you're seeing there is there is definitely a drain that's happening where Elastic is draining spend from Splunk and usage from them. The reason we used Elastic here is because all observabilities, the whole sector seems to be decelerating. Splunk is decelerating the most, but Elastic is the only one that's actually showing resiliency, so that's why we decided to choose these two, but you pointed out, yes, it's also Datadog. Datadog is Cloud native. They're more dev ops-oriented. They tend to be viewed as having technological lead as compared to Splunk. So a really good point. Dynatrace also is expanding their abilities and Splunk has been making a lot of acquisitions to push their Cloud services, they are also changing their pricing model, right? They're trying to make things a little bit more flexible, moving off ingestion and moving towards consumption. So they are trying, and the new hires, I'm not going to bet against them because the one thing that Splunk has going for them is their market share in our survey, they're still very well entrenched. So they do have a lot of accounts, they have their foothold. So if they can find a way to make these changes, then they will be able to change themselves, but the one thing I got to say across the whole sector is competition is increasing, and it does appear based on commentary and data that they're starting to cannibalize themselves. It really seems pretty hard to get away from that, and you know there are startups in the observability space too that are going to be even more disruptive. >> I think I want to key on the pricing for a moment, and I've been pretty vocal about this. I think the old SAS pricing model where you essentially lock in for a year or two years or three years, pay up front, or maybe pay quarterly if you're lucky, that's a one-way street and I think it's a flawed model. I like what Snowflake's doing, I like what Datadog's doing, look at what Stripe is doing, look at what Twilio is doing, you mentioned it, it's consumption-based pricing, and if you've got a great product, put it out there and damn, the torpedoes, and I think that is a game changer. I look at, for instance, HPE with GreenLake, I look at Dell with Apex, they're trying to mimic that model and apply it to infrastructure, it's much harder with infrastructure 'cause you've got to deploy physical infrastructure, but that is a model that I think is going to change, and I think all of the traditional SAS pricing is going to come under disruption over the next better part of the decades, but anyway, let's move on. We've been covering the APM space pretty extensively, application performance management, and this chart lines up some of the big players here. Comparing Net score or spending momentum from the April 20th survey, the gray is, sorry, the gray is the April 20th survey, the blue is Jan 21 and the yellow is April 21, and not only are Elastic and Datadog doing well relative to Splunk, Erik, but everything is down from last year. So this space, as you point out, is undergoing a transformation. >> Yeah, the pressures are real and it's sort of that perfect storm where it's not only the data that's telling us that, but also the direct feedback we get from the community. Pretty much all the interviews I do, I've done a few panels specifically on this topic, for anyone who wants to dive a little bit deeper. We've had some experts talk about this space and there really is no denying that there is a deceleration in spend and it's happening because that spend is getting spread out among different vendors. People are using a Datadog for certain aspects, they are using Elastic where they can 'cause it's cheaper. They're using Splunk because they have to, but because it's so expensive, they're cutting some of the things that they're putting into Splunk, which is dangerous, particularly on the security side. If I have to decide what to put in and whatnot, that's not really the right way to have security hygiene. So this space is just getting crowded, there's disruptive vendors coming from the emerging space as well, and what you're seeing here is the only bit of positivity is Elastic on a survey-over-survey basis with a slight, slight uptick. Everywhere else, year-over-year and survey-over-survey, it's showing declines, it's just hard to ignore. >> And then you've got Dynatrace who, based on the interviews you do in the (indistinct), one-on-one, or one-on-five, the private interviews that I've been invited to, Dynatrace gets very high scores for their roadmap. You've got New Relic, which has been struggling financially, but they've got a really good product and a purpose-built database just for this APM space, and then of course, you've got Cisco with AppD, which is a strong business for them, and then as you mentioned, you've got startups coming in, you got ChaosSearch, which Ed Walsh is now running, leave the data in place in AWS and really interesting model, Honeycomb is getting really disruptive, Jeremy Burton's company, Observed. So this space is it's becoming jumped ball. >> Yeah, there's a great line that came out of one of them, and that was that the lines are blurring. It used to be that you knew exactly that AppDynamics, what they were doing, it was APM only, or it was logging and monitoring only, and a lot of what I'm hearing from the ITDM experts is that the lines are blurring amongst all of these names. They all have functionality that kind of crosses over each other. And the other interesting thing is it used to be application versus infrastructure monitoring, but as you know, infrastructure is becoming code more and more and more, and as infrastructure becomes code, there's really no difference between application and infrastructure monitoring. So we're seeing a convergence and a blurring of the lines in this space, which really doesn't bode well, and a great point about New Relic, their tech gets good remarks. I just don't know if their enterprise level service and sales is up to snuff right now. As one of my experts said, a CTO of a very large public online hospitality company essentially said that he would be shocked that within 18 months if all of these players are still standalone, that there needs to be some M and A or convergence in this space. >> Okay, now we're going to call out some of the data that really has jumped out to ETR in the latest survey, and some of the names that are getting the most queries from ETR clients, many of which are investor clients. So let's start by having a look at one of the most important and prominent work from home names, Zoom. Let's look at this. Erik is the ride over for Zoom? >> Ah, I've been saying it for a little bit of a time now actually. I do believe it is, and we'll get into it, but again, pointing out, great, Dave, the reason we're presenting today Splunk, Elastic and Zoom, they are the most viewed on the ETR+ platform. Trailing behind that only slightly is F5, I decided not to bring F5 to the table today 'cause we don't have a rating on the data set. So then I went one deep, one below that and it's pure. So the reason we're presenting these to you today is that these are the ones that our clients and our community are most interested in, which is hopefully going to gain interest to your viewers as well. So to get to Zoom, yeah, I call Zoom the pandemic bull market baby. This was really just one that had a meteoric ride. You look back, January in 2020, the stock was at $60 and 10 months later, it was like 580, that's in 10 months. That's cooled down a little bit into the mid-300s, and I believe that cooling down should continue, and the reason why is because we are seeing huge deceleration in our spending intentions. They're hitting all-time lows, it's really just a very ugly dataset. More importantly than the spending intentions, for the first time, we're seeing customer growth in our survey flatten. In the past, we knew that the deceleration of spend was happening, but meanwhile, their new customer growth was accelerating, so it was kind of hard to really make any call based on that. This is the first time we're seeing flattening customer growth trajectory, and that in tandem with just dominance from Microsoft in every sector they're involved in, I don't care if it's IP telephony, productivity apps or the core video conferencing, Microsoft is just dominating. So there's really just no way to ignore this anymore. The data and the commentary state that Zoom is facing some headwinds. >> Well, plus you've pointed out to me that a lot of your private conversations with buyers says that, "Hey, we're, we're using the freebie version of Zoom, and we're not paying them." And that combined with Teams, I mean, it's... I think, look, Zoom, they've got to figure out how to use their elevated market cap to transform and expand their TAM, but let's move on. Here's the data on Pure Storage and we've highlighted a number of times this company is showing elevated spending intentions. Pure announced it's earnings in May, IBM just announced storage, it was way down actually. So still, Pure, more positive, but I'll on that comment in a moment, but what does this data tell you, Erik? >> Yeah, right now we started seeing this data last survey in January, and that was the first time we really went positive on the data set itself, and it's just really continuing. So we're seeing the strongest year-over-year acceleration in the entire survey, which is a really good spot to be. Pure is also a leading position among its sector peers, and the other thing that was pretty interesting from the data set is among all storage players, Pure has the highest positive public Cloud correlation. So what we can do is we can see which respondents are accelerating their public Cloud spend and then cross-reference that with their storage spend and Pure is best positioned. So as you and I both know, digital transformation Cloud spending is increasing, you need to be aligned with that. And among all storage sector peers, Pure is best positioned in all of those, in spending intentions and adoptions and also public Cloud correlation. So yet again, to start another really strong dataset, and I have an anecdote about why this might be happening, because when I saw the data, I started asking in my interviews, what's going on here? And there was one particular person, he was a director of Cloud operations for a very large public tech company. Now, they have hybrid, but their data center is in colo, So they don't own and build their own physical building. He pointed out that during COVID, his company wanted to increase storage, but he couldn't get into his colo center due to COVID restrictions. They weren't allowed. You had 250,000 square feet, right, but you're only allowed to have six people in there. So it's pretty hard to get to your rack and get work done. He said he would buy storage, but then the colo would say, "Hey, you got to get it out of here. It's not even allowed to sit here. We don't want it in our facility." So he has all this pent up demand. In tandem with pent up demand, we have a refresh cycle. The SSD depreciation cycle is ending. SSDs are moving on and we're starting to see a new technology in that space, NVMe sorry, technology increasing in that space. So we have pent up demand and we have new technology and that's really leading to a refresh cycle, and this particular ITDM that I spoke to and many of his peers think this has a long tailwind that storage could be a good sector for some time to come. >> That's really interesting, thank you for that extra metadata. And I want to do a little deeper dive on storage. So here's a look at storage in the industry in context and some of the competitive. I mean, it's been a tough market for the reasons that we've highlighted, Cloud has been eating away that flash headroom. It used to be you'd buy storage to get more spindles and more performance and we're sort of forced to buy more, flash, gave more headroom, but it's interesting what you're saying about the depreciation cycle. So that's good news. So ETR combines, just for people's benefit here, combines primary and secondary storage into a single category. So you have companies like Pure and NetApp, which are really pure play primary storage companies, largely in the sector, along with Veeam, Cohesity and Rubrik, which are kind of secondary data or data protection. So my quick thoughts here that Pure is elevated and remains what I call the one-eyed man in the land of the blind, but that's positive tailwinds there, so that's good news. Rubrik is very elevated but down, it's big competitor, Cohesity is way off its highs, and I have to say to me, Veeam is like the Steady Eddy consistent player here. They just really continue to do well in the data protection business, and the highs are steady, the lows are steady. Dell is also notable, they've been struggling in storage. Their ISG business, which comprises servers and storage, it's been softer in COVID, and during even this new product rollout, so it's notable with this new mid range they have in particular, the uptick in Dell, this survey, because Dell is so large, a small uptick can be very good for Dell. HPE has a big announcement next month in storage, so that might improve based on a product cycle. Of course, the Nimble brand continues to do well, IBM, as I said, just announced a very soft quarter, down double digits again, and they're in a product cycle shift. And NetApp, it looks bad in the ETR data from a spending momentum standpoint, but their management team is transforming the company into a Cloud play, which Erik is why it was interesting that Pure has the greatest momentum in Cloud accounts, so that is sort of striking to me. I would have thought it would be NetApp, so that's something that we want to pay attention to, but I do like a lot of what NetApp is doing, and other than Pure, they're the only big kind of pure play in primary storage. So long-winded, intro there, Erik, but anything you'd add? >> No, actually I appreciate it as long-winded. I'm going to be honest with you, storage is not my best sector as far as a researcher and analyst goes, but I actually think that a lot of what you said is spot on. We do capture a lot of large organizations spend, we don't capture much mid and small, so I think when you're talking about these large, large players like NetApp not looking so good, all I would state is that we are capturing really big organization spending attention, so these are names that should be doing better to be quite honest, in those accounts, and at least according to our data, we're not seeing it in. It's longterm depression, as you can see, NetApp now has a negative spending velocity in this analysis. So, I can go dig around a little bit more, but right now the names that I'm hearing are Pure, Cohesity. I'm hearing a little bit about Hitachi trying to reinvent themselves in the space, but I'll take a wait-and-see approach on that one, but pure Cohesity are the ones I'm hearing a lot from our community. >> So storage is transforming to Cloud as a service. You've seen things like Apex in GreenLake from Dell and HPE and container storage. A little, so not really a lot of people paying attention to it, but Pure bought a company called Portworx which really specializes in container storage, and there's many startups there, they're trying to really change the way. David Flynn, has a startup in that space, he's the guy who started Fusion-io. So a lot of transformations happening here. Okay, I know it's been a long segment, we have to summarize, and let me go through a summary and then I'll give you the last word, Erik. So tech spending appears to be tracking US GDP at 6 to 7%. This talent shortage could be a blocker to accelerating IT deployments, so that's kind of good news actually for services companies. Digital transformation, it remains a priority, and that bodes, well, not only for services, but automation. UiPath went public this week, we profiled that extensively, that went public last Wednesday. Organizations that sit at the top face some tough decisions on how to allocate resources. They're running the business, growing the business, transforming the business, and we're seeing a bifurcation of spending and some residual effects on vendors, and that remains a theme that we're watching. Erik, your final thoughts. >> Yeah, I'm going to go back quickly to just the overall macro spending, 'cause there's one thing I think is interesting to point out and we're seeing a real acceleration among mid and small. So it seems like early on in the COVID recovery or COVID spending, it was the deep pockets that moved first, right? Fortune 500 knew they had to support remote work, they started spending first. Around that in the Fortune 500, we're only seeing about 5% spend, but when you get into mid and small organizations, that's creeping up to eight, nine. So I just think it's important to point out that they're playing catch up right now. I also would point out that this is heavily skewed to North America spending. We're seeing laggards in EMEA, they just don't seem to be spending as much. They're in a very different place in their recovery, and I do think that it's important to point that out. Lastly, I also want to mention, I know you do such a great job on following a lot of the disruptive vendors that you just pointed out, with Pure doing container storage, we also have another bi-annual survey that we do called Emerging Technology, and that's for the private names. That's going to be launching in May, for everyone out there who's interested in not only the disruptive vendors, but also private equity players. Keep an eye out for that. We do that twice a year and that's growing in its respondents as well. And then lastly, one comment, because you mentioned the UiPath IPO, it was really hard for us to sit on the sidelines and not put some sort of rating on their dataset, but ultimately, the data was muted, unfortunately, and when you're seeing this kind of hype into an IPO like we saw with Snowflake, the data was resoundingly strong. We had no choice, but to listen to what the data said for Snowflake, despite the hype. We didn't see that for UiPath and we wanted to, and I'm not making a large call there, but I do think it's interesting to juxtapose the two, that when snowflake was heading to its IPO, the data was resoundingly positive, and for UiPath, we just didn't see that. >> Thank you for that, and Erik, thanks for coming on today. It's really a pleasure to have you, and so really appreciate the collaboration and look forward to doing more of these. >> Yeah, we enjoy the partnership greatly, Dave. We're very happy to have you on the ETR family and looking forward to doing a lot, lot more with you in the future. >> Ditto. Okay, that's it for today. Remember, these episodes are all available as podcasts wherever you listen. All you have to do is search "Breaking Analysis" podcast, and please subscribe to the series. Check out ETR website it's etr.plus. We also publish a full report every week on wikibon.com and siliconangle.com. You can email me, david.vellante@siliconangle.com, you can DM me on Twitter @dvellante or comment on our LinkedIn posts. I could see you in Clubhouse. This is Dave Vellante for Erik Porter Bradley for the CUBE Insights powered by ETR. Have a great week, stay safe, be well and we'll see you next time. (bright music)

overnight covid completely exposed those companies that were really not ready for the digital age there was a mad rush to the cloud in an effort to reshape the very notion of business resiliency and enable employees to remain productive so that they continue serve customers data protection was at the heart of this shift and cloud data protection has become a fundamental staple of organizations operating models hello everyone this is dave vellante and welcome to this cube conversation i'm joined by two long time friends of the cube rob emsley is the director of product marketing at dell technologies and stephen manley is the chief technology officer at dhruva guys great to have you on the program thanks for being here yeah great to be here dave this is the high point of my day dave all right i'm glad to hear it stephen it's been a while since we missing you guys so tell you face-to-face maybe it'll happen before 22. but we haven't aged a bit david ditto listen we've been talking for years about this shift to the cloud but in the past 12 months boy we've seen the pace of workloads that have moved to the cloud really accelerate so rob maybe you could start it off how do you see the market and perhaps what are some of the blind spots maybe that people need to think about when they're moving workloads so fast to the cloud yeah good question dave i mean you know we've spoken a number of times around how our focus has significantly shifted over the last couple of years i mean only a couple of years ago you know our focus was you know very much on on-premise data protection but over the last couple of years you know more workloads have shifted to the cloud you know customers have have started adopting sas applications and and all of these environments uh you know are creating data that is is so critical to these customers to protect you know so you know we've definitely found uh the more and more of our conversations have been centered around what can you do for me when it comes to protecting workloads in the cloud environment yeah now of course stephen this is kind of your wheelhouse how how are you thinking about the these market shifts yeah you know it's interesting and the data protection market heck the data market in general you know you see these these these sort of cycles happen and and for a long time we had a cycle where applications and environments were consolidating a lot it was all vms and oracle and sql and and we seem to be exploding out the other way to this there's a massive sprawl of different types of applications in different places like rob said you've got microsoft 365 and you've got salesforce and you've got workloads running in the cloud the world looks different and and you add on top of that the the new security threats as people move into the cloud i mean we you know a number of years ago we talked about how ransomware was an emerging threat we're way past emerging into you know there's a ransomware attack every six seconds and everybody wakes up terrified about it and so so so we really see the market has shifted i think in terms of what the apps are and also in terms of what the threats and the focus uh has come into play right well thanks for that there's there's some hard news which we're going to get to but but before we do rob stephen was mentioning the sas apps and we've been sort of watching that space for a while but a lot of people will ask why do i need a separate data protection layer doesn't my sas provider protect my data don't they replicate it they're they're cloud vendors why do i need to buy yet another backup product yeah there's there's a fairly common misconception dave you know that both sas application vendors and and and cloud vendors you know inherently are you know providing all of the data protection that you need um the reality is that they're not you know i think when you think about a lot of the data within those environments you know certainly they're focused on providing availability you know an availability you know is absolutely one thing that you can for the most part rely on the uh the cloud vendors uh to deliver to you but when it comes to actually um protecting yourself from you know accidental deletion you know protecting yourself from uh cyber threats and cyber crime that may infect your data you know through malicious acts you know that's really where you need to supplement the environment that the cloud providers provide you you know with you know best-in-class data protection solutions you know and this is really where you know we're really looking to introduce new innovations into the market you know to really really help customers you know with their client-based data protection yeah now you got some news here uh but let's kind of dig in if we we could to the to the innovations behind that maybe rob you could you could kick it off and then stephen will bring you in yeah so first piece of news that we're really happy to announce is the introduction of a new dell emc paraprotect backup service which is a new cloud data protection solution powered by druva you know hence you know the reason that stephen and i are here today it's designed to deliver additional protection without increasing it complexity so what powered by druva what does that mean can you add some color to that absolutely so you know when we really started looking at the expansion of our powerpatek portfolio you know we already have the ability to deliver both on-premises protection and to deliver that same software within the public cloud from a a paraprotect software delivery model but what we really didn't have within the portfolio is a cloud data protection platform and we really looked at you know what was available in the market we looked at our ability to develop that you know ourselves and we decided that the best path for our customers to bring capabilities to them as soon as we possibly could was to partner with druva you know when we really looked at the capabilities that that druva has been delivering for many years you know the capabilities that they have across many dimensions of of of cloud-based workloads and we're already engaged with them probably about six months ago you know first introduced druva as a an option uh to be resold by ourselves uh salesforce and partners and then we're pleased to to introduce uh a dell emc branded service power protect backup service okay so just one more point of clarification then stephen i want to bring you in so we're talking about this includes sas apps as well i'm talking 365 the google apps which we use extensively with crm salesforce for example what platforms are you actually you know connecting to and providing protection for yeah so the the real priority for us was to was to expand our power protect portfolio to support a variety of sas applications you mentioned you know uh real real major ones with respect to microsoft 365 um google workplace as well as um as uh as salesforce but the other thing that we also get with patek backup service is the ability to provide a cloud-based data protection service that supports endpoints such as laptops and desktops but also the ability to support hybrid workloads so for some customers the ability to use private backup service to give them support um for virtual machine backups both vmware and hyper-v but also application environments like oracle and sql and lastly but not least you know one of the things that backup service also provides when it comes to virtual machines is not only virtual machines on-premises but also virtual machines within the public cloud specifically vmware client on aws so stephen i i mean i i i remember i was talking to just several years ago and i've always liked sort of the druva model but it felt at the time you're like a little ahead of your time but boy the market has really come to you maybe you could just tell us a little bit more about the just generally cloud-based data protection and and the sort of low down on on your platform yeah and again i think you're right the market has absolutely swept in this direction like we were talking about with applications in so many places and endpoints in so many places and data centers and remote offices with data sprawled everywhere we find customers are looking for a solution that can connect to everything i i don't want seven different backup solutions one for each of those things i want one centralized solution and so kind of a data protection as a service becomes really appealing because instead of setting all of these things up on your own well it's just built in for you uh and and then the fact that it's it's as a service helps with things like the ransomware protection because it's off site in another location under another account and so we really see customers saying this is appealing because it helps keep my costs down it helps to keep my complexity down there's fewer moving parts and one of the nicest things is as i move to the cloud i get that one fixed cost right i'm not i'm not dealing with the oh wow this this bill is not what i was expecting it just comes in with with what i was what i was carrying and so it really comes down to as you go to the cloud you want a platform that's that's got everything built in uh something that and let's face it dell emc is is this this is this has always been the case you know that storage of last resort that backup that you can trust right you want something with a history like you said you've been talking to jaspreet for a while druva is a company that's got a proven track record that your data is going to be safe and it's going to be recoverable and you're going to want someone that can innovate quickly right so that as more new you know cloud applications arise you know we're there to help you protect them as they emerge so so talk a little bit more about the timing i mean we talked earlier about that okay covered really forced to shift to the cloud uh and you guys clearly have skated to the puck and you also you referenced sort of new workloads and and i'm just wondering how you see that from a you know timing standpoint and at this moment in time why this is such a you know the right fit yeah we we've seen a lot of customers over the last again 12 months or so you know one really accelerate their shift to things like sas applications microsoft 365 you know and and we're not just talking exchange online and onedrive but sharepoint online microsoft teams really going all in because they're finding that as as i'm distributed as i have a remote workforce my endpoints became more important again but also the ability to have collaboration became important and the more i depend on those tools to collaborate the more i'm depending on them to to replace what used to be in-person meetings where we could have a whiteboard and discuss things and it's it's done through collaboration online tools well i need to protect that not just because the data is important but because that's not how my business is running and so that entire environment is important and so it's really accelerated people coming and looking for solutions because they've realized how important these environments and this data is so stephen you mentioned you guys i mean i obviously have a track record but you got some vision too and i want to sort of poke at that a little bit i mean essentially is is what you're building is an abstraction layer that is essentially my data protection cloud is that how we should think about this and you've got your reference pricing i've seen your pricing it's clean it looks to me anyway like a like true cloud pricing gonna dial it up dial it down pay as you go consume it as you as you wish maybe talk about that a little bit yeah i mean i think if you think about the future of uh uh of consumption is that you know so many customers are looking for different choices than what many vendors have provided them in the past you know i think that you know the the days of of going through a you know a long procurement cycle and uh you know working through purchasing in order to get a big capital expense approved you know is it's just not the way that many of our customers are looking to operate now so i think that you know one of the things that we're looking at you know across the portfolio you know whether or not it be you know on-premises solutions or or cloud-based services is to provide all of that capability as a service you know i think that that will be you know a real future point of of arrival for us is we really rotate to offer that across all of our capabilities dave you know whether or not it be you know in the domain of storage or in the domain of data protection the concept of everything as a service is really something which is going to become more of the norm you know versus the exception so what does a customer have to do to be up and running what's that experience like is this going to log on and and everything's sort of you know there to them they what do they see what's the experience like yeah well that's one of the great things about parapatek backup service is that you know once the customer has has has worked through their you know their their uh their dell technologies you know sales uh team or their or their dell technologies partner you know they effectively you know get an activation um you know code to to sign up and and set up their credentials with powerpit backup servers and once they actually do that you know one of the things that they don't have to worry about is the deployment of the infrastructure the infrastructure is always on ready to go so what they do is they simply point powerpit backup service at the data sources that they wish to protect you know and that's one of the the great advantages around you know a sas based data protection platform you know and it's one of the things that that makes it very easy to get customers up and running with powerpath backup service so i'm guessing you have a roadmap you may be you maybe not you may be holding out on us and some of the other things that you're doing in this space but but what can you tell us about about other things you might be doing or that might be coming what can we expect well i mean you know dave that one of the things that you know we always talk about it's the power of the portfolio so so with the addition of private backup service it's not the only news that we're making with respect to cloud data protection you know i mentioned earlier that uh we have the ability to deploy our on-premises solutions in the public cloud with powerprotect data manager and our powerprotect virtual appliances you know and with this uh announcement that brings backup service into the portfolio we're also uh pleased to expand our support of the public cloud with full support of google cloud platform making powerprotect data manager available in the google marketplace and then lastly but not least you know our other cloud snapshot manager offering you know is now also fully integrated with our powerprotect virtual appliances to allow customers to store uh aws snapshots in a deduplicated fashion within aws s3 so that's an excellent capability that we've introduced to reduce the cost of storing um aws infrastructure backups for longer periods of time so really you know we've really continued to double down in bringing new cloud data protection capabilities to our customers wherever they may be yeah nice now steven you guys must be stoked have a partner like dell just massive distribution channel i wonder if you could give us any final thoughts you know thoughts on on the relationship how you see the future unfolding yeah i mean and obviously i've got you know history with with dell and emc and rob and one of the things you know i think dell's always been fabulous at is giving customers the flexibility to protect their data when they want how they want where they want with the investment protection but if it shifts over time they'll be there for them right going all the way back to the data protection suite and all those those those fantastic things we've done historically and so it's it's really it's great to to align with somebody that's got the same kind of values we do which is at druva it's that same model right wherever you want to protect your data wherever it is we're going to be there for you and so it was great that i think dell and druva both saw this demand from our customers and we said you know this is the right match right this is how we're going to help people keep their data safe as they start you know and continue and extend their journeys to the cloud and so you know dell proposes the the power protect backup service powered by druva and and everybody wins the dell's customers are safer dell completes its offering and let's face it it does help druva accelerate our momentum so this is this is this is and it's a lot of fun just hanging out with the people i used to work with especially wrong it's good seeing him again well you guys both have kind of alluded to the portfolio and the optionality that dell brings to its customers but rob you know i'll give you the final word a lot of times optionality brings complexity but this seems to be a really strong step in the direction of simplifying the world for your customers but rob i'll give you the last word yeah for sure i mean we've always said that it's not a one-size-fits-all world you know i think that you know one of the things that this um evolution of our powerpatek portfolio brings you know is an excellent added option for our customers you know many of the customers if not almost all of the customers that we currently sell to you know have a requirement for sas application protection you know many of them now especially after the last year have an added um sensitivity to endpoint protection you know so so those two things alone you know i think are are two things that all dell technology customers can really take advantage of with the introduction of private backup servers you know this is just a continued evolution of our uh capabilities to bring innovative data protection for multi-cloud workloads that last point is a great point about the endpoints because you got remote workers so exposed guys thanks so much for sharing the announcement details and the relationship and really good luck with the offering we'll be watching thanks dave thanks dave and thank you for watching this cube conversation this is dave vellante for the cube we'll see you next time you

(upbeat music) >> Overnight COVID completely exposed those companies that were really not ready for the digital age. There was a mad rush to the cloud in an effort to reshape the very notion of business resiliency and enable employees to remain productive so that they continue serve customers. Data protection was at the heart of this shift and cloud data protection has become a fundamental staple of organizations operating models. Hello, everyone. This is Dave Vellante and welcome to this CUBE conversation. I'm joined by two longtime friends of theCUBE, Rob Emsley is the director of product marketing at Dell Technologies. And Stephen Manley is the Chief Technology Officer at Druva. Guys, great to have you on the program. Thanks for being here. >> Yeah, great to be here, Dave. >> This is the high point of my day, Dave. >> I'm glad to hear it, Stephen. It's been a while since we... Missing you guys to tell you face to face maybe it'll happen before 22, >> We haven't aged a bit, Dave. >> (laughing) Ditto. Listen, we've been talking for years about this shift to the cloud. In the past 12 months, boy, we've seen the pace of workloads that have moved to the cloud really accelerate. So Rob, maybe you could start it off. How do you see the market and perhaps what are some of the blind spots maybe that people need to think about when they're moving workloads so fast in the cloud? >> Yeah. Good question Dave. I mean, you know, we've spoken a number of times around how our focus has significantly shifted over the last couple of years. I mean, only a couple of years ago, our focus was very much on on-premise data protection, but over the last couple of years, more workloads have shifted to the cloud. Customers have started adopting SaaS applications and all of these environments are creating data that is so critical to these customers to protect, we've definitely found that more and more of our conversations have been centered around what can you do for me when it comes to protecting workloads in the client environment? >> Yeah. Now of course, Stephen, this is kind of your wheelhouse. How are you thinking about the these market shifts? >> Yeah. You know, it's interesting in the data protection market. heck the data market in general, you see these sort of cycles happen. And for a long time, we had a cycle where applications and environments were consolidating a lot. It was all VMs and Oracle and SQL and we seem to be exploding out the other way to this massive sprawl of different types of applications in different places. Like Rob said, we've got Microsoft 365 and you've got Salesforce and you've got workloads running in the cloud. The world looks different. And you add on top of that the new security threats as people moving to the cloud. A number of years ago we talked how ransomware was an emerging threat. We're way past emerging into... there's a ransomware attack every six seconds and everybody wakes up terrified about it. And so we really see the market has shifted I think in terms of what the apps are and also in terms of what the threats and the focus and this that's come into play. >> Right. Well, thanks for that. There's some hard news which we're going to get to, but before we do, Rob, Stephen was mentioning the SaaS apps and we've been sort of watching that space for a while but a lot of people will ask why do I need a separate data protection layer? Doesn't my SaaS provider protect my data? Don't they replicate it? They're cloud vendors, why do I need to buy yet another backup product? >> Yeah, that's a fairly common misconception, Dave, that both SaaS application vendors and cloud vendors, inherently are providing all of the data protection that you need. The reality is that they're not, you know I think when you think about a lot of the data within those environments, certainly they're focused on providing availability. And availability is absolutely one thing that you can, for the most part, rely on the cloud vendors to deliver to you. But when it comes to actually protecting yourself from accidental deletion. Protecting yourself from cyber threats and cyber crime that may infect your data through malicious acts, that's really where you need to supplement the environment that the cloud providers provide you, with best in class data protection solutions. And this is really where, waywardly looking to introduce new innovations into the market to really, really help customers with that cloud based data protection. >> Yeah. Now you got some news here. Let's kind of dig in, if we could, to the innovations behind that. Maybe Rob, you could kick it off and then, Stephen, we'll bring you in. >> Yeah. So first piece of news that we're really happy to announce is the introduction of a new Dell EMC PowerProtect backup service which is a new cloud data protection solution powered by Druva, hence the reason that Stephen and I are here today. It's designed to deliver additional protection without increasing IT complexity. >> So powered by Druva. what does that mean? Can you add some color to that? >> Absolutely. So, when we really started looking at the expansion of our PowerProtect portfolio, we already have the ability to deliver both on-premises protection and to deliver that same software within the public cloud from a PowerProtect software delivery model. But what we really didn't have within the portfolio is a cloud data protection platform. And we really looked at what was available in the market. We looked at our ability to develop that ourselves. And we decided that the best path for our customers to bring capability to them as soon as we possibly could was to partner with Druva. And we really looked at the capabilities that Druva has been delivering for many years, the capabilities that they have across many dimensions of cloud-based workloads. And we already engaged with them probably about six months ago, first introduced Druva as an option to be resold by ourselves, Salesforce and partners. And then we're pleased to introduce a Dell EMC branded service PowerProtect backup service. >> Okay, so just one more point of clarification, then, Stephen, I want to bring you in. So we're talking about... this includes SaaS apps as well, I'm talking 365, the Google apps which we use extensively, CRM, Salesforce, for example. >> Absolutely. >> What platforms are you actually connecting to and providing protection for? >> Yeah, so the real priority for us was to expand our PowerProtect portfolio to support a variety of SaaS applications. You mentioned, real major ones with respect to Microsoft 365, Google workplace, as well as Salesforce. But the other thing that we also get with PowerProtect backup service is the ability to provide a cloud-based data protection service that supports endpoints such as laptops and desktops but also the ability to support hybrid workloads. So for some customers the ability to use PowerProtect backup service to give them support for virtual machine backups, both VMware and Hyper-V, but also application environments like Oracle and SQL. And lastly, but not least, one of the things that backup service also provides when it comes to virtual machines is not only virtual machines on premises, but also virtual machines within the public cloud, specifically VMware cloud on AWS. >> So, Stephen, I remember I was talking to Jaspreet several years ago, and I've always liked sort of the Druva model but it felt at the time you were like a little ahead of your time, but boy, the market has really come to you. Maybe you could just tell us a little bit more about the just generally cloud-based data protection and the sort of low down on your platform. >> Yeah, and I think you're right, the market has absolutely swept in this direction. Like we were talking about with applications in so many places and end points in so many places and data centers and remote offices with data sprawled everywhere. We find customers are looking for a solution that can connect to everything. I don't want seven different backup solutions, one for each of those things, I want one centralized solution. And so kind of a data protection as a service becomes really appealing because instead of setting all of these things up on your own, well, it's just built in for you. And then the fact that it's as a service helps with things like the ransomware protection because it's off site in another location under another account. And so we really see customers saying this is appealing because it helps keep my costs down. It helps keep my complexity down. There's fewer moving parts. And one of the nicest things is as I move to the cloud I get that one fixed cost, right? I'm not dealing with the, oh, wow, this bill is not what I was expecting. It just comes in with what I was carrying. And so it really comes down to, as you go to the cloud, you want a platform that's got everything built in, something that, and let's face it, Dell EMC, this has always been the case, that storage of last resort that backup that you can trust, right? You want something with a history, like you said, you've been talking to Jaspreet for awhile, Druva is a company that's got a proven track record that your data is going to be safe and it's going to be recoverable and you're going to want someone that can innovate quickly, right? So that as more new cloud applications arise, we're there to help you protect them as they emerge. >> So talk a little bit more about the timing. I mean, we talked earlier about, okay, COVID really forced this shift to the cloud and you guys clearly have skated to the pocket and you also... You referenced sort of new workloads and I'm just wondering how you see that from a timing standpoint. And at this moment in time why this is such a, you know, the right fit. >> We've seen a lot of customers over the last again 12 months or so, one really accelerate their shift to things like SaaS applications, Microsoft 365, and we're not just talking exchange online and One Drive, but SharePoint online, Microsoft teams, really going all in because they're finding that, as I'm distributed, as I have a remote workforce, my end points became more important again, but also the ability to have collaboration became important. And the more I depend on those tools to collaborate, the more I'm depending on them to replace what used to be in-person meetings where we could have a whiteboard and discuss things. And it's done through collaboration online tools. Well, I need to protect that. Not just because the data's important, but because that's now how my business is running. And so that entire environment is important. And so it's really accelerated people coming and looking for solutions because they've realized how important these environments and this data is. >> So, Stephen, you mentioned that you guys, I mean, obviously you have a track record but you got some vision too. And I want to sort of poke at that a little bit. I mean, essentially is what you're building is an abstraction layer that is essentially my data protection cloud. Is that how we should think about this? And you've referenced pricing, I've seen your pricing, it's clean. It looks to me anyway like a true cloud pricing. Going to dial it up, dial it down, pay as you go, consume it as you wish. Maybe talk about that a little bit. >> Yeah. I mean, I think if you think about the future of consumption is that so many customers are looking for different choices than what many vendors have provided them in the past. I think the days of of going through a long procurement cycle and working through purchasing in order to get a big capital expense approved it's just not the way that many of our customers are looking to operate now. So I think that one of the things that we're looking at across the portfolio, whether or not it be on premises solutions or cloud-based services, is to provide all of that capability as a service. I think that that will be a real future point of arrival for us as we really rotate to offer that across all of our capabilities, Dave, whether or not it be in the domain of storage, or in the domain of data protection, the concept of everything as a service is really something which is going to become more of the norm versus the exception. >> So what does a customer have to do to be up and running? What's that experience like, is he just going to log on and everything's sort of there to them, what do they see? What's the experience like? >> Yeah, that's one of the great things about PowerProtect backup services, that once the customer has worked through that, their Dell technologies sells a team or the Dell technologies partner, they effectively get an activation code to sign up and set up the credentials with PowerProtect backup service. And once they actually do that, one of the things that they don't have to worry about is the deployment of the infrastructure. The infrastructure is always on ready to go. So all they do is they simply point PowerProtect backup service at the data sources that they wish to protect. That's one of the great advantages around a SaaS based data protection platform and it's one of the things that makes it very easy to get customers up and running with PowerProtect backup service. >> So I'm guessing you have a roadmap, you may be, you may be not, you may be holding out on us in some of the other things that you're doing in this space, but what can you tell us about other things you might be doing or what might be coming? What can we expect? >> Well, I mean, Dave, that one of the things that we always talk about is the power of the portfolio. So, with the addition of PowerProtect backup service, it's not the only news that we're making with respect to client data protection. You know, I mentioned earlier that we have the ability to deploy our on premises solutions in the public cloud with PowerProtect data manager and our PowerProtect virtual appliances, and with this announcement that brings backup service into the portfolio. We're also pleased to expand our support of the public cloud with full support of Google cloud platform, making PowerProtect data manager available in the Google marketplace. And then lastly, but not least, you know our other cloud snapshot manager offering is now also fully integrated with our PowerProtect virtual appliances to allow customers to store AWS snapshots in a debilitative fashion within AWS S3. So that's an excellent capability that we've introduced to reduce the cost of storing AWS infrastructure backups for longer periods of time. So really, we've really continued to double down in bringing new client data protection capabilities to our customers, wherever they may be. >> And nice to have, Stephen, you guys must be stoked to have a partner like Dell, a massive distribution channel. I wonder if you could give us any final thoughts, thoughts on the relationship, how you see the future unfolding. >> Yeah, I mean, and obviously I've got history with Dell and EMC and Rob. And one of the things I think Dell has always been fabulous at is giving customers the flexibility to protect their data when they want, how they want, where they want, with the investment protection that if it shifts over time, they'll be there for them, right. Going all the way back to the data protection suite and all those fantastic things we've done historically. And so it's really, it's great to align with somebody that's got the same kind of value as we do, which is with Druva, it's that same model, right? Wherever you want to protect your data, wherever it is, we're going to be there for you. And so it was great that I think Dell and Druva both saw this demand from our customers. And we said, this is the right match, right? This is how we're going to help people keep their data safe as they start and continue and extend their journeys to the cloud. And so, Dell proposes the PowerProtect backup service powered by Druva. And everybody wins. The Dell's customers are safer. Dell completes this offering, and let's face it, it does help to really accelerate our momentum. So this is and it's a lot of fun just hanging out with the people I used to work with especially it's good seeing them again. >> Well, you guys both have kind of alluded to the portfolio and the optionality that Dell brings to its customers, but Rob, you know, I'll give you the final word. A lot of times optionality brings complexity, but this seems to be a really strong step in the direction of simplifying the world for your customers. But, Rob, we'll give you the last word. >> Yeah, for sure. I mean, we've always said that it's not a one size fits all world. You know, I think that one of the things that this evolution of a PowerProtect portfolio brings is an excellent added option for our customers. Many of the customers, if not, almost all of the customers that we currently sell to, have a requirement for SaaS application protection. Many of them now, especially after the last year, have an added sensitivity to endpoint protection. So those two things alone I think are two things that all Dell technology customers can really take advantage of with the introduction of perhaps that backup service. This is just a continued evolution of our capabilities to bring innovative data protection for multi-cloud workloads. >> That last point is a great point about the end points because you've got remote workers, so exposed, guys, thanks so much for sharing the announcement details, and the relationship, and really good luck with the offering. We'll be watching. >> Thanks, Dave. >> Thanks Dave. >> And thank you for watching this CUBE conversation. This is Dave Vellante for theCUBE. We'll see you next time. (soft music)

>> Narrator: From theCUBE's studios in Palo Alto, in Boston, connecting with thought leaders all around the world. This is a CUBE conversation. >> Hey everybody, this is Dave Vellante and welcome to this episode of "CXO Insights." As you know, we've been grabbing the perspectives of leaders throughout this pandemic and assessing their tips for managing in a crisis and of course, managing in good times as well. But now, as we enter the post-isolation economy, we really want to look at not just how you manage through the crisis but how you manage beyond the crisis. And I'm really excited to have Chris Riley here. He's the newly minted Chief Revenue Officer at Automation Anywhere. Chris, my friend, how you doing? I hope you and the family are well. >> Thank you, David. I wish the same for you. I think getting by as most folks are, it's the new normal, we're all getting used to it but I'm happy to be here and happy to be at Automation Anywhere. >> Yeah, I want to talk about that in detail. Eddie Walsh calls it the new abnormal but so congratulations on the new role. I want to start with your career. I met you in 1987, which ironically was the same year I met Dave Donatelli, the same year I met Michigan I. and Saul Koi, talk about great timing. And then, you came into the industry at a time, really different time. It was, the IBM people don't remember this but IBM was the dominant player and you guys unseated them amazing 12-year career at EMC and then you kind of went to the .com boom. That was amazing. You relive that ride, did a stint at HP and really turned that business around and then came back to Dell, top go to market executive. One of the top in the industry that I know and now, of course at Automation Anywhere we're going to talk about. My first question to you is, a lot of changes have occurred since 1987. What has changed the most? Now we're talking diversity, we're talking all kinds of your different sales models. From your career looking back, what's changed the most? >> I think everything has changed and candidly for the better, Dave. You just led with one of the key areas in an area I'm deeply passionate about and that is diversity and inclusion and I think there's no stronger time, at least in our country's history where the inequalities that exist have been so exposed. So I view this as an opportunity, as I did at Dell to make a difference, lead from the front and make this a destination and a company whose culture really supports and drives diversity and inclusion. So I'd say that's one area, and I know it's very passionate for you as well. The others, it was a time before laptops, desktops. I think Ken Olsen once said, who would ever need a laptop in their home and boy, the world has changed. So I think some of the things though that haven't changed and this is why I'm so excited about Automation Anywhere. At the manual processes we have our workers doing and I think there is a real opportunity. I've lived through explosive growth at EMC, top company performing stock during the 90s, I get to see VMware firsthand. I've seen what's happened with ServiceNow and I believe this RPA space, as to you is in its infancy. It's seeing 30% compounded annual growth and we're just at the beginning and I think it's going to change the way people work and really lead to that digital transformation that so many of us have been talking about for the last decade. >> Yeah and you know kind of my position. Quick aside, I don't know if you saw the Netflix announcement this morning and I've been wondering as a small business, what can we do? What more can we do for inclusion and diversity? Netflix announced they're going to take 2% of their cash and put it into banks, financial institutions that support black causes and I just talked to our CFO. I said, look, why don't we take some of our cash, let's take 2% and stick it into banks, community banks. There's 30 million small businesses in the United States. If just 1% puts 10 grand in each, that's $3 billion that go into black community. So I'm going to start a mission and I just thought I'd share that 'cause I know it's a passion of yours. >> Yeah, and we all need to be in a position to provide equal opportunity for employment and that is reaching out into those communities and starting early on in creating the opportunities for advancement professionally, mentorship and just the path forward. And I'm excited to see what Netflix is doing. I'm sure you'll come up with the right answer for your company and I think all of us are searching, what's the right answer for our respective companies? >> Yeah, so now let's get into it. You're a month in and I want to talk about this project. I've learned a lot about not only RPA but about automation. I've just had a deep dive with your team and it really brought some things into focus. Guys, if you bring up the first slide, I want to get some thoughts on the table here. So this is a chart that sort of came into my focus with a friend of mine, Dave Moschello, who really big thinker on this stuff and he pointed out, this is data from the US Bureau of Labor and Statistics and the EU and it shows the lackluster productivity that's going on in the past decade. So you can see, we had the boost in the 80s and the 90s, we had this sort of productivity uptick from laptops but now, look what's happened since 2007. And the point that Moschello made on the right hand side is we have all these huge issues that we face, whether it's climate change, we have this massive debt, healthcare, an aging population, feeding everyone, et cetera, et cetera, et cetera, and his point was, there's no way we're going to be able to solve all these problems by throwing humans at the problem. So I've really begun to sort of think about this just in terms of machines and the roles that machines will play. I think overnight, Chris, we've gone from, wow, I'm afraid that machines are going to take my job to you can't operate if you're not digital. >> Yeah, well digital transformation is not a new term. I think it's meant something different each year for the last 10 years and I look at this as an opportunity. The World Economic Forum projected that IA and RPA will create 58 million new jobs. It's an astounding number. What COVID-19 has exposed is this work from home phenomenon that really exposes the risk of manual processes within the enterprise. So I think those two things combined is almost a perfect storm and I think what it'll do is accelerate the adoption of RPA and IPA. So something that might've taken years or decades to really be adopted in force, in this new normal, I think is going to be accelerated quite dramatically. >> So, the combination of your go to market execution, you managed complex sales motions before. Automation Anywhere obviously has some great product capabilities. Guys, I want to bring up the next slide and Chris, you might have seen this in some of the stuff that I wrote but this is data from ETR Enterprise technology research. They're a data partner of ours. Now it's clear that Automation Anywhere has the right product market fit and you can see on this chart, this is a methodology that we use. ETR goes out and they ask people, are you adopting a platform new? Are you increasing spending relative to last year? Are you flat, decreasing or replacing? And you can see here, there is zero churn in the Automation Anywhere base. And so obviously you got product market fit. Churn is the silent killer, obviously of SAS companies and so, you've picked a winner and I'm learning more about this. At first I thought the team office is quite large, I sized it. I actually think it's bigger than I originally thought. Chris, I thought this was going to be a winner-take-all type of market. I'm really rethinking that after, especially the deep dive I've had with your team in terms of how you guys go to market with an end-to-end sort of life cycle approach as opposed to sort of putting point products in. So I wonder if that narrative that I just laid out, resonates with you, is it sort of consistent with what you're seeing and then maybe some of the reasons why you joined Automation Anywhere? >> Yeah, I would say the most aggressive software growth that I've seen in the last decade or so, and two companies stand out for me. That's VMware and ServiceNow. They don't have a point product, they have a platform and that's what attracted me to Automation Anywhere is this platform approach. And Dave as you know, I've spent most of my career calling on the enterprise' strong relationships with those types of companies and they aren't looking to develop a point product solution and then cobble together lots of disparate islands of solutions. They're looking for a platform that can grow as they grow. They can extend from the back office to the front office but all centered around workforce, transformation, productivity and just as importantly, resiliency. And as we start to develop more and more capabilities that will be delivered through this platform approach, I think we're going to see explosive growth as the industry goes through its explosive growth. >> Well, I know your approach and your approach is to stay very close to customers. So as you were doing your due diligence on Automation Anywhere and as you enter your sort of first part of your 100-day journey here, I'm sure you've talked to a lot of customers. What are they telling you? What are the big takeaways right now that you're hearing? >> Yeah, so I think some of the data you pointed out with 4,000 customers in essence, zero churn, the opportunity to upsell those customers with more products and solutions clearly is there. New account acquisition has been a tremendous source of growth for the company in a strong professional services organization that actually is able to deliver the outcomes that our customers expect. From an enterprise perspective, I couldn't have come into a better situation with 4,000 customers, 50% of the fortune 500, 2 million bots deployed, those types of strategic relationships are going to be more and more critical as this company continues to accelerate its growth. Most of the RPA solutions really got in through the back office and candidly, really weren't even a component of an IT solution. Now, as you go to the front of the house, where you're looking at customer facing applications and worker productivity, these are CEO, CFO, COO and IT initiatives. So I really believe we're coming into our own, at the front of the house with senior executives that really want to create a better working environment for their employees and de-risk a lot of these manual processes that have existed for years. >> So I know why you chose Automation Anywhere. My question is, why did Automation Anywhere choose Chris Riley? I know your capabilities but obviously when somebody hires a executive like yourself, they say, "Hey, Chris, we want you to help us "get to the next level," but what does that mean? Are we talking about changes in the go to market? Are we talking about your ability to recruit and coach, to manage complex of sales motions? What is it that you want to bring to Automation Anywhere? >> I think it's all those, Dave. Having built a reputation throughout my 30 plus year career around a people-centric focus, a customer-centric focus and those two things kind of aren't interchangeable. When you look at customers, they put their faith and confidence in people and they put their faith and confidence in companies. And what I see here at Automation Anywhere is that the ability to kind of expand upon the great culture that the company already has but do it with someone whose role in a company at scale globally and can put a lot of the best practices and disciplines in place to do that 'cause it is difficult but also, how do we start to do larger, more complex deals and build relationships with the CIO, the CFO, the CEO? And I think a big reason why I'm here is, that experience in doing that, doing large complex multi-year opportunities but also being able to deliver upon the outcomes that we told our customers we could achieve and do that together with our customers and again we have a strong professional services organization and an incredible ecosystem of partners that have demonstrated year over year, the company's ability to actually deliver upon its promise. >> That was my next question to you, was the ecosystem. One of the big changes from when you started in this business, was it used to be just belly to belly, hardcore, direct sales, the importance and leverage that you get from a partner ecosystem. You point out VMware. In fact ServiceNow, it's interesting. When we first started covering ServiceNow, one of the things we said is we want to see as an indicator of success, the partner ecosystem evolve and then sure enough, it exploded with the SIs and all the kinds of developers. So maybe talk about AA's ecosystem, The Partner System. You obviously have a lot of experience there in your career, how do you see that as a leverage point? >> Yeah, it's huge. This market is far larger than we can cover with a direct sales organization and requires substantial services engagements that go well beyond the kind of professional services organization we want to build out organically in the company. So when you look at that, the company today has 1,900 partners. The global systems integrators are key, especially those with VPO type practices, the regional SIs and candidly, the regional VARs who've built out a strong service malpractice, a strong VMware practice and have the professional services capabilities to do some of these complex automation or automation type work that have also built the trust and confidence of their customers. So, in partnership with these types of companies, we believe we can expand our reach. We believe we can offer a more comprehensive outcome and solution to our customers and we, what I'm going to be looking at is, how do we enhance our channel programs to be the kind of company that the channel partners want to engage with, built upon the reputation of the company, the leadership position we have in the technology and also our willingness to go after this space together. >> So I got to go but last question is, what can you share with us about your 100-day plan? Where are you going to focus? >> On the people. There is a strong culture here, there's incredible sales talent and there's talent throughout the organization. I think Dave, you've seen for me over the years, a clarity of our mission, keep things simple and try and drive a repetitive process to deliver results. I'm very accountability focused. So I think what I'm going to look to assess is where the organization is today, how to get more out of the great talent we have, build stronger and deeper relationships with our customers and really scale and grow through our ecosystem of channel partners. >> Well, Chris, I'm super excited for you. A great hire by Automation Anywhere obviously got my attention. I think it'll get the industry's as well. Best of luck, and of course we'll be watching. >> Good, always great to see you, Dave, take care. >> Yeah, ditto, thanks so much for coming on and thank you for watching everybody. Keep it here because this month we're going to be really digging into the ETR data we've been reporting on that horse race between Automation Anywhere and UI Path. The ETR data is in the field and we'll be reporting on that. So look for that. This is Dave Vellante for theCUBE and we'll see you next time. (gentle music)

>>From the cube studios in Palo Alto in Boston. It's the cube covering the IBM thing brought to you by IBM. We're back and this is Dave Vellante and you're watching the cube and we're covering wall-to-wall the IBM 2020 I think digital experience. Rob Thomas is here. He's the senior vice president of clouds and data. Right. Warm rub. Always a pleasure to see you. I wish you were face to face, but Hey, we're doing the best we can. As you say, doing the best we can. Great to see you Dave. Hope family safe, healthy, happy as best you can be. Yeah. Ditto. You back out your Robin. Congratulations on on the new role, you and the cube. We've been riding this data wave for quite some time now. It's really been incredible. It really is. And last year I talked to you about how clients, we're slowly making progress on data strategy, starting to experiment with AI. >>We've gotten to the point now where I'd say it's game on for AI, which is exciting to see and that's a lot of what the theme of this year's think is about. Yeah, and I definitely want to dig into that, but I want to start by asking you sort of moves that you saw you're in there seeing your clients make with regard to the cobot night covert 19 crisis. Maybe how you guys are helping them in very interested in what you see as sort of longterm and even, you know, quasi permanent as a result of this. I would first say it this way. I don't, I'm not sure the crisis is going to change businesses as much as it's going to be accelerating. What would have happened anyway, regardless of the industry that you're in. We see clients aggressively looking at how do we get the digital faster? >>How do we automate more than we ever have before? There's the obvious things like business resiliency and business continuity, managing the distributed workforce. So to me, what we've seen is really about, and acceleration, not necessarily in a different direction, but an acceleration on. The thing is that that we're already kind of in the back of their minds or in the back of their plans now that as we'll come to the forefront and I'm encouraged because we see clients moving at a rate and pace that we'd never seen before that's ultimately going to be great for them, great for their businesses. And so I'm really happy to see that you guys have used Watson to really try to get, you know, some good high fidelity answers to the citizens. I wonder if you could explain that initiative. Well, we've had this application called Watson assistant for the last few years and we've been supporting banks, airlines, retailers, companies across all industries and helping them better interact with our customers and in some cases, employees. >>We took that same technology and as we saw the whole covert 19 situation coming, we said, Hey, we can evolve Watson assistant to serve citizens. And so it started by, we started training the models, which are intent based models in Watson assistant on all the publicly available data from the CDC as an example. And we've been able to build a really powerful virtual agent to serve really any citizen that has questions about and what they should be doing. And the response has been amazing. I mean, in the last two weeks we've gone live with 20 organizations, many of which are state and local governments. Okay. Also businesses, the city of Austin children's healthcare of Atlanta. Mmm. They local governments in Spain and Greece all over the world. And in some instances these clients have gotten live in less than 24 hours. Meaning they have a virtual agent that can answer any question. >>They can do that in less than 24 hours. It's actually been amazing to see. So proud of the team that built this over time. And it was kind of proof of the power of technology when we're dealing with any type of a challenge. You know, I had a conversation earlier with Jamie Thomas about quantum and was asking her sort of how your clients are using it. The examples that came up were financial institutions, pharmaceutical know battery manufacturers, um, airlines. And so it strikes me when you think about uh, machine intelligence and AI, the type of AI that you're yeah, at IBM is not consumer oriented AI. It's really designed for businesses. And I wonder if you could sort of add some color to that. Yeah, let's distinguish the difference there. Cause I think you've said it well consumer AI is smart speakers things in our home, you know, music recommendations, photo analysis and that's great and it enriches all of our personal lives. >>AI for business is very different. This is about how do you make better predictions, how do you optimize business processes, how do you automate things that maybe your employees don't want to do in the first time? Our focus in IBM as part of, we've been doing with Watson is really anchoring on three aspects of AI language. So understanding language because the whole business world is about communication of language, trust meaning trusted AI. You understand the models, you understand the data. And then third automation and the whole focus of what we're doing here in the virtual think experience. It's focused on AI for automation. Whether that's automating business processes or the new announcement this week, which is around automating AI opera it operations for a CIO. You, you've talked the years about this notion of an AI ladder. You actually, I actually wrote a book on it and uh, but, but it's been hard for customers to operationalize AI. >>Mmm. We talked about this last year. Thanks. What kind of progress, uh, have we made in the last 12 months? There's been a real recognition of this notion that your AI is only as good as your data. And we use the phrase, there's no AI without IAA, meaning information architecture, it's all the same concept, which is that your data, it has to be ready for AI if you want to too get successful outcomes with AI and the steps of those ladders around how you collect data, how you organize data, how you analyze data, how you infuse that into your business processes. seeing major leaps forward in the last nine months where organizations are understanding that connection and then they're using that to really drive initiatives around AI. So let's talk about that a little bit more. This notion of AI ops, I mean it's essentially the take the concept of dev ops and apply it to the data pipeline if you will. >>Everybody, you know, complains, you know, data scientists complained that all, they spent all their time wrangling data, improving data quality, they don't have line of sight across their organization with regard to other data specialists, whether it's data engineers or even developers. Maybe you could talk a little bit more about that announcement and sort of what you're doing in that area. Sure. So right. Let me put a number on it because the numbers are amazing. Every year organizations lose 2016 point $5 billion of revenue because of outages in it system. That is a staggering number when you think about it. And so then you say, okay, so how do you break down and attack that problem? Well, do you have to get better at fixing problems or you have to get better at avoiding problems altogether. And as you may expect, a little bit of both. You, you want to avoid problems obviously, but in an uncertain world, you're always going to deal with unforeseen challenges. >>So the also the question becomes how fast can you respond and there's no better use of AI. And then to do, I hope you like those tasks, which is understanding your environment, understanding what the systems are saying through their data and identifying issues become before they become outages. And once there is an outage, how do you quickly triage data across all your systems to figure out where is the problem and how you can quickly address it. So we are announcing Watson AI ops, which is the nervous system for a CIO, the manager, all of their systems. What we do is we just collect data, log data from every source system and we build a semantic layer on top that. So Watson understands the systems, understands the normal behavior, understands the acceptable ranges, and then anytime something's not going like it should, Watson raises his hand and says, Hey, you should probably look at this before it becomes a problem. >>We've partnered with companies like Slack, so the UI for Watson AI ops, it's actually in Slack so that companies can use and employees can use a common collaboration tool too. Troubleshoot or look at either systems. It's, it's really powerful. So that we're really proud of. Well I just kind of leads me to my next question, which I mean, IBM got the religion 20 years ago on openness. I mean I can trace it back to the investment you made and Lennox way back when. Um, and of course it's a huge investment last year in red hat, but you know, open source company. So you just mentioned Slack. Talk about open ecosystems and how that it fits into your AI and data strategy. Well, if you think about it, if we're going to take on a challenge this grand, which is AI for all of your it by definition you're going to be dealing with full ecosystem of different providers because every organization has a broad set of capabilities we identified early on. >>That means that our ability to provide open ecosystem interoperability was going to be critical. So we're launching this product with Slack. I mentioned with box, we've got integrations into things like PagerDuty service now really all of the tools of modern it architecture where we can understand the data and help clients better manage those environments. So this is all about an open ecosystem and that's how we've been approaching it. Let's start, it's really about data, applying machine intelligence or AI to that data and about cloud for scale. So I wonder what you're seeing just in terms of that sort of innovation engine. I mean obviously it's gotta be secure. It's, it seems like those are the pillars of innovation for the next 10 plus years. I think you're right. And I would say this whole situation that we're dealing with has emphasized the importance of hybrid deployment because companies have it capabilities on public clouds, on private clouds, really everywhere. >>And so being able to operate that as a single architecture, it's becoming very important. You can use AI to automate tasks across that whole infrastructure that makes a big difference. And to your point, I think we're going to see a massive acceleration hybrid cloud deployments using AI. And this will be a catalyst for that. And so that's something we're trying to help clients with all around the world. You know, you wrote in your book that O'Reilly published that AI is the new electricity and you talked about problems. Okay. Not enough data. If your data is you know, on prem and you're only in the cloud, well that's a problem or too much data. How you deal with all that data, data quality. So maybe we could close on some of the things that you know, you, you talked about in that book, you know, maybe how people can get ahold of it or any other, you know, so the actions you think people should take to get smart on this topic. >>Yeah, so look, really, really excited about this. Paul's the capitalists, a friend of mine and a colleague, we've published this book working with a Riley called the a ladder and it's all the concepts we talked about in terms of how companies can climb this ladder to AI. And we go through a lot of different use cases, scenarios, I think. Yeah. Anybody reading this is going to see their company in one of these examples, our whole ambition was to hopefully plant some seeds of ideas for how you can start to accelerate your journey to AI in any industry right now. Well, Rob, it's always great having you on the cube, uh, your insights over the years and you've been a good friend of ours, so really appreciate you coming on and, uh, and best of luck to you, your family or wider community. I really appreciate it. Thanks Dave. Great to be here and again, wish you and the whole cube team the best and to all of our clients out there around the world. We wish you the best as well. All right. You're watching the cubes coverage of IBM think 20, 20 digital, the vent. We'll be right back right after this short break. This is Dave Volante.

>> Announcer: From theCUBE Studios in Palo Alto and Boston, connecting with thought leaders all around the world, this is the CUBE Conversation. >> Hello everybody, welcome to this special CXO Series that I've been running over the past couple weeks, my name is Dave Vellante and what I've been doing is bringing in executives from around the industry to try to better understand how they're dealing with this COVID crisis, what some of their fundamental communications principles are, and I'm really pleased to invite in Sri Srinivasan, who's the Senior Vice President and GM of Cisco Collaborations. Sri, great to see you again. It seems like just a long time ago actually, but it was just January that we were in Barcelona together, wow, a lot has changed. >> A lot has changed, Dave. Dave, thanks for having me on the show, it's always a pleasure to see you and I'm so happy to see you safe and sound today. >> Yeah, ditto, we're all in this together, as they say so I want to go back to, I mean we were in January we were getting clenches of this thing. We were definitely a little bit worried but not really fully grasping the impact. At what point did you kind of realize that you were going to have to adjust, and how did you shift your priorities as a leader? >> Yeah, so, Dave we started seeing this right out of the Chinese New Year, coming out of the Chinese New Year, on February 11th, if my memory serves me right. Users out of China started increasing, connecting to their global sites by multiples. Like, they went up as much as 22 times, on the night of February 11th and right off the bat we started seeing it expanding to South Korea, Japan, Singapore, Australia, Malaysia, Vietnam, Thailand, and towards the end of February, we started seeing it going to Europe in terms of expanded volumes where people working from home. Europe has expanded nearly four times for us, Asia pack has expanded nearly three to four times in terms of total usage and from the second week of March, it's US, our biggest market, which has more than doubled and as you may have heard, this past month in March, we served 324 million attendees on our meeting platform. We provide a whole slew of collaboration capability set. The fundamental principle for us that we apply is, provide customers with business continuity, while keeping their employees and their families safe. That is the fundamental principle we apply and one of my engineers said it really well. He said, "for every WebEx engineer-hour spent, "we now keep people safe for 14 thousand hours, "or 583 days". That is the amount of time through virtual capability set we're able to bring people together safely and continue their businesses forward as is nearly normal. >> I mean, the numbers are unbelievable. Chuck Robbins, over a month ago, said you guys held, and this is early March, 3.2 million meetings and 5.5 billion minutes, and the numbers have just gone up from then. Guys, I wonder if you could bring up the chart, I want to set up this conversation and so, we along with our partner ETR, we're one of the first to report sort of the impact of COVID on IT Budgets and what this chart is showing is that, that gray bar says 35% of those CIO's that we talked to said they don't expect any change in spending for 2020. >> Sri: Mhm. >> Dave: The green side over 20% said they expect to spend more and then you can see the big red. So overall, we've taken the overall forecast at the beginning of the year was plus 4% was kind of the consensus for IT spend. We're now down to minus 4%. The point though is that it would be a lot worse Sri, were it not for that green, which is being driven by the work from home offset, and it's not just collaborations tools, its networking, its security, its VPN, it's all the infrastructure around that so I wonder if you could comment and add a little bit of color to what you're seeing in the space. >> I think we're seeing immense expansion of work from home capabilities. Work from home is new for so many people, like for people like me it's the norm but there's so many people who are coming into it cold for the very first time, it can be daunting and that requires investments from organizations, I think CIOs IT infrastructure heads are working to make sure they provide the best secure collaboration canvas for people to work in from home, understanding the challenges of last mile excellence, security challenges and things of that sort so there is a ton of investment going on, in speeding up that investment and I see something coming out of this, which is recognition that organizations are going to have to fix and modernize their digital infrastructure. Why is that important? I think environmental sustainability has something called LEED Certification. Very similar to that work from home is going to have some type of certification that says, an organization is ready for this type of a mass upheaval moment where their infrastructures keep their businesses alive, kicking and thriving through any situation and I think what we have seen is many organizations struggle getting to that first step. Now, technology allows them to move very fast these days but no organization wants to struggle through it in the future, whether it's public sector or commercial enterprise, it's one and the same. >> I think that's a great point, one of the things I wanted to ask you was about some of the things that you've learned and maybe some of the things that are going to be permanent and I think that, people didn't expect this obviously and so do you feel as though that organizations will kind of rethink and that portions of this will become permanent, maybe they'll sub-optimize, in the near-term profitability and try to optimize for business resilience and the flexibility to do things like work from home, your thoughts. >> So Dave, I do see some things becoming permanent, right? Do I expect the volumes of collaboration to go down? No, it's never going to go back to the same level. The world as we know it is going to change forever. We are going to have a Post-COVID era and that's going to be changed for the better. There's a number of employees who are being skeptical, reticent to working from home, who are suddenly going to say, work from home thing is not so bad after all so you're going to have that moment for sure and then you're going to also have a set of employers who are going to look at a much wider pool of applicants that are cross timezone, geography, language barriers, it's going to help an organization increase their diversity and inclusiveness ocean, making their products and services much better so I think we are opening up the surface area for innovation as a result and you will see a lot of the work from home technologies get better and better, we're being forced to be better because we now have to be relatable, discernible easy to a new class of worker that has never seen these technologies and it is across all kinds of barriers that technology has to adhere itself to so I do see a lot of goodness coming in and you know what, at the end of the day, it's really good for the environment too >> I want to ask you how you're supporting customers. The data partner that I mentioned ETR, the other day I sat in one of their CIO Roundtables and it's a private conversation with (mumbles) and CIOs and they were asking them like, who's helping you through this and who's not and they mentioned, for instance, back in the 2009 timeframe, there was one company they won't mention. It was doing audits right after the crisis. That was not a cool thing but I got to give Cisco some props it came up that they really were helping in three areas and one of the CIOs just really mentioned this and called it out. He said, collaboration tools, network, we're a Cisco customer so we're relying more on the network and then the security piece so specifically how are you supporting your customers in this crisis? >> So, towards the end of February, what we did is we opened up our collaboration technology and Chuck said something very profound to me. He basically said, "let's make sure we do right by our customers "and keep them safe through this exercise." What we came out with was a set of free offers. We expanded (mumbles) free offer by providing unlimited meeting time, up to a hundred participants toll dial-in into our meetings infrastructure in 52 countries. We didn't basically just say, hey, only in countries afflicted by the virus, we basically made it as global as we could make it possible and then we provided enterprise trials through our partner routes to market that is an enterprise could sign up for a 90-day thing, no strings attached. Just take on the collaboration platform and whether it's calling, meetings, our device infrastructure and just take advantage of it and in a secure fashion using our security portfolio using extensions of our network portfolio and just continue to operate so we've added close to north of 15 million users through our free offers to date that (mumbles) >> Wow. >> and no strings attached. We're not asking for a credit card or a contract at the end of it, if you like it, and we come out at the other end of it, we are happy that they're safe and if they stay a long-term customer of ours, we are happy about that too. >> I mean, that's awesome. We saw recently a lot of talk about big tech and a lot of attacks on big tech and you're seeing big tech really step up, so thank you for that. You know us. We're not gotcha media, but it's I feel it's really important to ask you this. Zoom has had some clear issues with security. Eric Yuan, was instrumental in developing WebEx so what assurances can you give (Sri coughs) your customers and our audience that you're not subjected to similar security gaps and flaws? >> So let's talk about our security principles, right? Our security principles are very clear, we are open and transparent about the issues we face, the investments we make and we will be very open in terms of our posture. Secondly, we will never rent or sell customers data. Thirdly, we have a growth mindset around security. It's a differentiator. You never get complacent about security, you keep on investing in it and to be honest with you, WebEx has come a very long way since some of the comments that were made in the press by some of our competitors. circa 2012 WebEx versus now there's so much innovation that has happened Dave. We've had over 100 major software updates so I would rather have our competitors focus on their issues rather than, give us kudos in public. Our promise to our customers is to be open, transparent and continuously invest in the space because the moment you take your eyes off it, you've opened yourself up for a set of attacks so we're not going to ever say we are fully secure. You just have to continually invest in the growing threat posture world we live in today. >> So I want to follow up on that because I mean, I'm not a security expert, but I've interviewed enough people to know that they will tell you, you can't just bolt on security, you got to build it in and it's a hard thing to do. Some of your security pros Gee Rittenhouse, TK Keanini would definitely second this so, >> Yeah. >> How, you're saying you've spent a lot of time obviously designing in and I'm inferring not bolting on so I wonder if you could add some color to the sort of types of things that you've done to really, assure your customers that you're secure. >> Yeah, so I think security is in the DNA of Cisco, pun intended in many ways. We pride ourselves in our craft and to be honest with you, security starts at the time of design for us and it's not a checkbox exercise at the end of the ship cycle. You build for security. You build for privacy and compliance and you build with one simple rule. It's your customers data, we are custodians and we need to be protectors of it all the way through. We do not sacrifice experience for security. We never will. We build high-grade experiences but we never give up on security capability set and whether it's free, whether it's premium, whether it's paid. We have the same levels of security, yes, we do have additional security add ons and finally, we have a culture where there are groups within Cisco that continually test us. They don't report to me, they report to chuck and the board and they pretty much are continuously measuring our threat posture. These are world class organizations that keep you on your toes and I'm so thankful for that. It helps our customers safe, it helps us be better. It helps us stay current with the threat postures and this is years of investment. This is not something you can do in 90 days or 30 days. You'd be doing lip service to it. This is something you've got to do, critical, intentional, deliberate investments that pay off in the long-term. >> Yeah, and things like penetration testing, it's not a one shot deal, you got to do it on an ongoing basis. I want to come back to productivity. There are some organizations that are concerned they're struggling a little bit with productivity, particularly with the work from home. What advice would you give to organizations in terms of being able to maintain that productivity? They might take a little bit of hit but what would you tell them? >> I think change is difficult. Change is not easy. I'll take my own story here. Dave, two years back when I joined Cisco work from home was a alien culture to me based on where I came from, for the first month I did struggle. I had my questions, I had my trepidations of is this really going to work? Am I going to be able to run thousands of engineers, multibillion dollar business from home or while traveling on a plane because we have so many development centers across the globe and I'm a remote worker. I really saw this as opening up new horizons for me starting the first month. I took it on with gusto so I think my guidance to organizations is help end users deal with that change. If you force it down their throats, it's not going to work. You've got to understand their pains, you've going to make it more pleasing. You've got to introduce things like a digital water cooler talk, you've got to make it easy on them, you've got to talk about improvements in a remote-work setting like providing them with a set of accessories that make it easier for you to work from home. One of the core principles we have and i espouse within my organization is by working from home, you're intruding into your family's space. I think it's so important to make sure you let your family in on your work and when kids walk into the door, today, when we work at Cisco, we actually share our family and we share our joy with the wider teams and we are so proud of such culture so be very open and make sure that you understand that you're intruding into somebody else's house when you're working from home. >> Yeah, we have dogs barking, we have kids playing games and crawling all over us, that's great. one of the... >> The dogs barking we have solved we have an AI technology that brings it down. >> Mutes the barking. That's good, I need one. >> Absolutely. >> So one of my big takeaways and you really underscored it here is we're not going back to 2019. The digital transformation that we talk about and that frankly many give lip service (mumbles) but it is now going to be accelerated and it's ironic, we're starting a new decade but this digital transformation is going to be accelerated and collaboration is going to be a key underpinning so I'll ask you to give us some final thoughts, will you please? >> Yeah, I think, people to people collaboration is so important in this day and age. As such, industry has been changing from a task-based hierarchy driven world to a group-outcome based synergistic, a bring people along type culture and that brings people along type cultures now, thanks to collaboration technology, becoming independent of timezone, you don't have to worry about language barriers anymore or cultural boundaries. Think of the type of ideation you can do by bringing people across the world together with a low carbon footprint and what this time has shown us is that businesses can still continue to operate and operate really well when you bring people together using these virtual technologies and capability sets. You're saving people some time by having them work from home like you don't have to travel 30 and 40 minutes to get to work. You're just doing doing your thing from wherever you are and that saves so much in cost, in capability sets and the concept of hoteliering and open spaces in different organizations is only going to sprout even further because not everybody is going to have a home office, have an office, a set office, in within the enterprise CEOs are going to see that as a cost saving opportunity that they can funnel back into the growth of the organization. Right? So I think it's a plethora of opportunity in front of us and that these technologies are going to get monumentally better in the months to come. >> We're definitely entering a new chapter. Sri, thanks so much for sharing your insights and some of your leadership principles and thanks to Cisco, for all that you guys are doing some of the pro bono work. I know some of the volunteerism that Chuck has talked about. Really appreciate your time. >> Thanks Dave. Always a pleasure, stay safe. >> And thank you for watching everybody. This is Dave Vellante for theCUBE, we'll see you next time. (upbeat music)

>> Live from Las Vegas, it's theCUBE covering Magento Imagine 2019, brought to you by Adobe. >> Welcome back to theCUBE Lisa Martin with Jeff Frick and we are here live at Magento Imagine 2019, our second time being back here with theCUBE and we're very excited to welcome Brittany Hodak to theCUBE, entrepreneur, customer engagement speaker, writer, co-founder of the Superfan Company. Brittany it's so exciting to have you on theCUBE. >> Thank you so much for having me. I'm so excited to be here. >> So, you have an incredibly impressive background and I'm like where do we start? >> Thank you. >> So, here we are talking about customer experiences and how Magento and Adobe empower a lot of customer experiences. But you've written a ton of articles, over 350, you've been published in the Huff Post, Wall Street Journal, talk to us about your experiences with customer engagement, some of the things that you as a co-founder of the Superfan have discovered working with a variety of brands from Walmart to Katy Perry? >> Well, thank you so much for saying that. I always say that the biggest problem brands and entertainers have is often one that's not even on their radar at all. I talked to a lot of small and medium sized business owners and they say, You know, my big problem is people don't know who I am. I've got an awareness problem. I'm struggling to let people know who I am. And I really think my business would change if more people knew. And I said, You know, that's not the problem. You can always fix awareness. You can always spend money to get your message out there. Your big problem is apathy. Your problem is there are people who know and don't care. And you've got to figure out how to make people care. You've got to figure out how to connect your story with their story in a way that's meaningful, and in a way that's going to mean something in their lives because that's how you really start the fan engagement process. That's how you lay the groundwork for creating a culture of super fandom amongst your customers, that's really going to help you grow not just the business but a brand. >> Is it about having a more relevant messages or is it just finding those people that have a propensity to be a fan to the services that you provide? >> Well, it's understanding your uniqueness in a way that really makes your value proposition different from anybody else is. Once you understand your uniqueness and you're able to turn it into service of others, that's when you really you position yourself to be able to make the kind of difference that makes somebody want to be a super fan. And I always say, we've had the fortune of working with tons of celebrities, some of the biggest recording artists and superstars on the planet, and a lot of times people say to me, Oh, you know, it's easy when you're talking about being a super fan of Taylor Swift or being a super fan of Katy Perry, but, you know, I'm a plumber or I'm an electrician, how can I have super fans? And I say, By providing people the kindness service that changes their lives. I have an exterminator who I am a super fan of. His name is Scott and the reason I am a super fan of him is because he makes sure there are no brown recluse spiders in my house and I am absolutely terrified about recluse spiders. They are super evil creatures if you're not familiar with them, I encourage you not to google it. They're like nastiest little bug in the world. But you know to me that's super important because he's not just killing bugs, he's helping me feel safe in my home. So that's absolutely a vital service and finding the right guy to do that and the right guy to put my mind at ease and let me know there aren't going to be brown recluse spiders in my house is invaluable and because of that, like there's no way I would ever switch exterminators because Scott's my guy. And I know you know, I can text him 50 different pictures of critters and say, Is this okay, Is this okay? And he's going to get back to me and let me know. So, it's all about points of connection and finding ways to make your audience feel really valued, and connecting your story with their story. >> So, if you look at an exterminator versus a Taylor Swift or Katy Perry or Walmart, are there similarities and what they need to do to deliver this service that's impacting lives? Or are there fundamental differences? >> There are some fundamental differences, but there's more overlap than you would think. And I always say, if you think about it like a Venn diagram, you've got your brand or your business, your service, your product, whatever it is that you're providing, and you've got your customers over here. Where the magic happens is that point of intersection, where your story overlaps with their story, that intersection, that's where super fandom happens. And I like to talk about something I call the four A's of super fandom. So, you can, I see a lot of people make the mistake of trying to talk to everybody the same way. So, whether somebody is encountering your brand for the very first time or has been your customer for a long time, using the same messaging for those people and that doesn't work. So, I talk a lot about the four A's. So, the first day is awareness. That's when somebody is first uncovering your brand, first interacting with your brand. The second a is action, that's when somebody is actually interacting with your brand for the first time. The third a is affinity. Those are the people who are fans of your brand. They've sort of bought into your why, these are the satisfied customers, I would say. And a lot of businesses stop there. They say, These are the people who are satisfied. These are the people who liked what I'm doing, they're buying from me. And that's a mistake that a lot of especially small and medium sized businesses make they sort of feel like, I've got these customers, I don't have to do anything else. They're not over delivering or over serving them which is a huge missed opportunity because if you do, you're able to convert people from that third A to the fourth a which is advocacy. And advocacy is where you want to get the majority of the people because those are your superfans so to speak, those are the ones who are out there sharing your story and your why with other people, helping refer new customers and new clients to you. So, I always say if you can get past the affinity, the people who are happy with you but not really talking about it and really make them feel valued. That's how you create advocates and advocacy is really the super secret sauce when you're talking about super fandom. >> So where should people get started to try to build super fandom within their client base? Is that really with the good customers that they already have, they try to get them to be advocates or I think most people spend so much time focusing on the fat end of the funnel as opposed to on the narrow end of the funnel and converting that transaction into a fan which is what it sounds like you're suggesting? >> Yeah, well, it's important to to focus on all parts of the funnel man, like I said that that awareness, that that fat of the top, you certainly need to be dealing with those people to get them further down. But the skinny part of the funnel is really where you want to make sure that people are continuing to drip out to the other side to make those referrals for you. So, absolutely focusing on everybody. One thing that I am always shocked I when I do consulting and work with small businesses and medium sized businesses, when I asked how much referral business they get, a lot of people don't know that number off the top of your head. So, if you're not tracking the amount of referrals, you absolutely need to know that as a metric, and the number one thing that you can do to increase the amount of referral business that you're getting is by asking your customers for referrals. It's so funny the amount of people who say, I hardly get any referral business at all. And I say, Well, when's the last time you asked? When's the last time that you went to one of your clients or your customers and said, I so appreciate your business. And I wonder if you know anybody in your network who could benefit from our product or service. And they say, oh I've never done that. But yeah, they wonder why they don't have any referrals so-- >> It seems like such an easy step but to your point, you're saying they're focusing on awareness, getting my brand, my service, my name out there, getting people to take action? >> Yes. >> And building that affinity and then I'm good, but that simply asking to make it a referral whether it's a yelp or something as simple as that seems like a pretty easy step. Strategically, how do you advise customers to get from that, take that if you look at it like a funnel like Jeff saying, take that group of affinity customers and convert some percentage to advocates, what's your strategy for helping a consumer brand or even a service provider, like an exterminator for actually making those conversions and then and then having that be a really kind of engine to drive referrals, to drive more leads to the top of that funnel? >> That's a great question. So, I like to talk about something I call the high five which is knowing the five most important people that have the potential to drive your business forward for the next quarter, the next year and the next five years. So, this is an actual list of five people. And any business owner hopefully can sit down and say, Here are the people that I need to really super serve in order to move my business forward. So knowing who those five people are, it could be an advisor, it could be an investor, it could be somebody you've never even met, maybe a thought leader whose thought that you really enjoy, that you think this person could really help me and open me up to a lot of people in their network if they knew who I was. Make a list of those five people, and then figure out how often you need to be doing something staying top of mind for those people. So for me, I like to make sure it's at least once every two weeks. So, sometimes it's as simple as sending an article and saying, Hey, I came across this article, I thought you would really love it, wanted to send it your way. Now and reality, did I just come across that article? No, I spent maybe an hour looking for the right article to forward that person. It's taking the time out to show them that they matter to you, so whether that's sending them a nice gift in the mail for no reason or a handwritten thank you note after they made an introduction for you. It's checking in on things, I always say, you should know what is important to the people who are important to you. You should know the teams that they follow, you should know their spouse, their children, the things that are happening in their lives so you can check in with them. And we live in an age where it's so easy to get information about anyone because all of us are putting content out there on the internet all the time about ourselves. So take the time to figure out what matters to those people who matter to you, and then stay top of mind, letting them know that they matter to you. So, like I said, for me, it's once every two weeks and I look at my list of five about every six months in terms of adding a couple of new people on maybe cycling some people off. But I've been doing this for four years. So, I have a list of 20 people. And I those are like my alums, some of the alumni of my high five, and I'm still extremely close with all of them. I still make sure that I'm trying to add value to them because having one person who's going to advocate for you could open the door for millions of dollars of revenue for you. So, it's just identifying who those people are, because to your point, it's impossible to sort of make everyone the most important person, it's impossible to take everyone at that third step and take them to the fourth step. So, rather than holistically thinking about it. I like to really drill in and say let's start with five. And if you've got 50 employees and you assign five people to each of those 50 employees to say make sure this vendor or make sure this customer, or make sure this partner feels very appreciated by you on a regular basis. You're going to, you really start to see the ROI very, very quickly in your business. >> So some of the trends, if we look at this we're all consumers of any kind of product service, we have this expectation, this growing expectation that we're going to be able to get whatever we want whenever we want it, have it delivered in an hour or a day, or so, we want to be able to have this experience on mobile, maybe started there, maybe finish it in the store, what are some of the trends that you're seeing that you recommend that the company with any product or service needs to get on board with, for example, this morning they were talking about progressive web apps and being able to deliver an experience where the person doesn't have to leave the app, or they can transact something like through Instagram. What are some of those top tools that you recommend to your broad client base. You got to get on board with like mobile, for example, right away. >> Yes, I was going to say the PWAs are absolutely critical, because I think we've all as consumers been in the situation of trying to load something on our phone, and it's five seconds goes by six seconds, I'm like forget about it. >> We're done. >> Yeah, I'm done, I'm over it. So PWAs is super important because it's all about putting your customer first and making things simple for them. The other thing is making sure that whatever system process you're using, everything needs to be connected. You can't be managing stuff across eight different platforms and expect for things not to fall through the cracks which is I'm learning so much here at Imagine and listening to all the best practices of people who are using Magento to manage every part of their business because something is seemingly minor as sending a confirmation email twice instead of once or having eight hours go by before the customer gets that, those types of things, say to a customer on a subliminal level, I'm not important, I don't matter, they're not putting me first. >> So just fan comes from fanatic. And there's great things about fans, and some times there's less great things about fans and we've seen a little bit of that here in terms of this really passionate community around Magento. And it was independent. And then it went to eBay and then it went back out of eBay. And now it's back in Adobe. And it's funny seeing the people that have been here for the whole journey. Part of that responsibility, if you're going to invite someone to be a fan is you have to let them participate, you have to let them contribute. And often which we're seeing, I guess, in Game of Thrones, I'm not a big fan, but if you get outside of kind of the realm of where the fans want things to go, it can also cause some conflict. So, how to people manage encouraging fans, really supporting fans, but at the same time not letting them completely knock their business off or hold the business back probably from places where the entrepreneur needs to still go? >> That's a great question. There was a really fascinating study that Viacom did a couple of years ago about fans. And especially in the under 35 sets, so millennials, gen Z. And the vast majority of people felt like fans have some ownership of the thing that they're a fan of. And that's a really interesting study in psychology to think about these people who feel the ownership. But you know, it's true. You mentioned Game of Thrones, that's a great example of seeing these fan bases who come up with names for themselves, and who are tweeting in real time about things that are happening. Magento a great example because open source has been such an important part of the culture and the history of the platform. These people feel in a very real sense this ownership. And you're right, I think sometimes that scares small business owners, medium sized business owners. They say, Well, we don't want to relinquish control. We don't want to put ourselves in a situation where we're upsetting people. And I would say, You're right, fan comes from the word fanatic. And that fanaticism, that passion is something you absolutely want. Because I would argue that a greater threat than that is what I was talking about earlier, which is apathy. You don't want people to be like, I don't care. And passion is of course, the opposite of apathy. And that's what you're looking for. So I would say, are you going to put yourself in a position where sometimes there could be a disagreement, you could upset somebody? Absolutely, but you those are the people, it's like if you're in a relationship with somebody and you have a fight that passion that's there is because there's care on both sides. You're both super engaged, you're both very passionate about your position. So, having a system in place to defuse that by saying, I hear you I understand where you're coming from, let's figure this out together, is part of the customer service staff that you've just got to prepare for. >> Can you using, sorry Brittany, using all this data that's available that Magento, Adobe et cetera can deliver and enable organizations to understand that and maybe even kind of marry those behaviors with apathy on one hand passion on the other and how do we get to that happy medium? >> Exactly, how do we get to the happy medium, what are the data points that matter? How are we, the idea of super fan means something different to every organization. So, part of it is uncovering what it is that really matters to you. I always say a super fan is somebody who over indexes and their affinity for a product, service, brand, entertainer, therefore increasing the chance that they're going to advocate on its behalf. So, thinking about, there could be people who are spending a lot of money with your brand who just aren't really that passionate about it. They're not going to tell people and that's fine. But those aren't the people who would be a quote unquote superfan, even though they may be spending a lot of money with you. So, it's figuring out what the markers are that are important to your brand or service. I work with a lot of brands on this because it really is different for everyone. But figuring out who those people are and then talking to them because this is something that, there's so much psychology around the why. Like why people behave the way we do that the consumer behavior, the internal and philosophical drives that are making us make the decisions that we make and the best way to uncover that is to talk to your customers because a lot of times you'll learn so much about your brand, you'll find so many things. I always love talking to recording artists about this, they put out a new song or a new album and in the fans find all these hidden messages >> Taylor is known for that. >> Always some-- >> Taylor is one of the best in the world. And a lot of times artists will say, Oh, yeah, like, I didn't do that on purpose but I'm totally going to take credit for it because these fans found it. And oh, yeah, of course, I meant to do that. So, you'll find that some of these customers understand your brand oftentimes better than you do which is a really fun thing. >> It's also just the ecosystem. You my favorite one always reference is Harley Davidson, guess how many brands get tattooed on people's arms, and just the whole ecosystem of other products that were built up around the motorcycle, and to support kind of that community they weren't getting any nickels necessarily if somebody sold a saddle bag or a leather jacket, or whatever but it was such and it still is, I think such a vibrant community again, and as evidence by you put a tattoo on your arm that it's something to strive for, not easy to get. >> Why we always say build a brand not a business because the brand are those things that people are connecting to. We were talking about NASA before we started filming. I'm a huge space geek and Lisa loves space having worked for NASA in the past and that's one of those things, I don't know this to be true but I got to believe NASA way outpaces like every other combined government agency in licensing. I mean, people walk around wearing NASA logos on everything >> I saw at least three of them this morning. >> Yeah, I mean, I bought in the last month, probably three different NASA licensed products. So I mean that's the passion that if you can connect to somebody on an emotional level and make your story part of their story. They want to represent it, they want to get that Harley tattooed on their arm. >> That emotional connection but also that personalization that's key? >> Yes. >> What's difference in from your perspective on a superfan versus an influencer? Are they one in the same? >> It's a great question. So, they a lot of times are one in the same and that same Viacom study that I mentioned earlier. Something like two thirds of people said that they consider themselves to be pop culture influencers which sounds like a lot. But if you think about it, pretty much everyone is an influencer and that's because for Nielsen, the most trusted recommendation is or the most trusted form advertising is a recommendation from a friend or a family member, 92% of people trust a recommendation from a friend or family member, which far outpaces every other form of advertising. So in a lot of ways, these micro influencers are the next wave of advertising. These advocates or these super fans are, I think in many ways an untapped well of resources for the fans who drill in and you mentioned Taylor Swift before. How many people listen to Taylor Swift for the first time because a friend suggested they listen to Taylor Swift. I would argue that lots and lots of people and Taylor said something to me years ago that like a former manager, or someone said to her, and that was, if you want to sell half a million albums, you're going to have to meet half a million people. That was said to her when she was like, 15, 16 years old and she thought, okay, yeah, I'm going to go meet half a million people. I'm going to be befriend them, I'm going to listen to their stories, I'm going to let them know what they say matters to me. And here we are, she sold, I don't know, 50, 60 million albums, however many she sold worldwide. And but that's really where it starts, that one to one connection. >> Seems to just kind of all go back to referral. And isn't that sort of the basic human connection? It's like, are we trying to over-complicate this with all these different tools that simply, even with hiring and tech or whatever industry, referrals are so much more important because you've got some sort of connection to a brand or a person or a product or service. >> You've got that connection, you've got somebody who's already very well qualified. And I like to talk about something that I call the wave method which the wave is a ritual hello, goodbye. How many times a day do you wave at people, countless. And virtually you say hello to tons of people everyday. People who are coming to one of your social pages, people who are engaging with your website. So I say, I encourage people to think about that hello and goodbye, that interaction. Think of a wave as an acronym and ask yourself, are you making everybody who's going to come into contact with you today feel welcomed? Is there something on your virtual site or in your real storefront. If you're a brick and mortar business that's going to make people feel welcomed? How are you making them feel like they belong? The A is appreciated, how are you letting those people know that they are appreciated by your business? I think I know I have often felt like I'm a number or I don't matter. Utility companies are notorious for this for making you feel like they don't really care if they have your business or not. Or they know perhaps that they're going to because there's not like a different water company you can you can use it your home. And that sucks, like we've all been made to feel like we weren't appreciated by somebody that we were doing a financial transaction with. So ask yourself, how can you make your potential and current customers feel appreciated? The V stands for validated, and one of the best quotes that I've ever come across is from Oprah. On her last episode, she was imparting some of the lessons that she had learned over the years of hosting her shows and she said she'd interviewed something like 30,000 people over the years, and they all wanted the same thing. And that was validation. They all want it to feel like they were important and their feelings mattered. I see you, I hear you what you're saying is important to me. So, validate your customers. One big mistake that I see people make all the time in customer service is when somebody has a complaint, having your rebuttal be like, Oh, I've never heard that before. Or it's 10,000 people haven't have had great experiences. That's absolutely the worst thing that you can ever say to somebody because you're bringing in other experiences that don't matter to them. It's a one to one conversation. It's a one to one relationship. So bringing in, that's like having a fight with your significant other and saying like, Well none of the women I dated before you ever had a problem with this, like how well is that going to go over? Like you don't want to bring in other experiences. So that V and wave validated >> And the E? >> and then the E is excited, making people feel excited because that passion, having people feel like you know you're excited that they're a customer of yours and you can bring something that's going to make their lives better is the most important key. >> Brittany, thank you so much. I could keep talking to ya. I wish we didn't end but we do, for sharing your experiences, your expertise, your recommendations on becoming any kind of brand with any product or service, generating the super fans. We appreciate your time. >> Thank you so much. It was so great speaking with you guys today. >> Ditto. >> Thanks. >> For Jeff Frick, I'm Lisa Martin. You're watching this on theCUBE live from Magento Imagine 2019 from Vegas, thanks for watching.

>> Hi, I'm Peter Burris, Chief Research Officer for Wikibon Cube and welcome to another special digital community event. Today we are going to be presenting Wikibon's 2019 trends. Now, I'm here in our Palo Alto Studios in kind of a low tech mode. Precisely, because all our our crews are out at all the big shows bringing you the best of what's going on in the industry, and broadcasting it over The Cube. But that is okay because I've asked each of our Wikibon analysts to use a similar approach to present their insights into what would be the most impactful trends for 2019. Now the way we are going to do this is first we are going to use this video as base of getting our insights out, and then at the end we are going to utilize a crowd chat to give you an opportunity to present your insights back to the community. So, at the end of this video, please stay with us, and share your insights, share your thoughts, your experience, ask your questions about what you think will be the most impactful trends of 2019 and beyond. >> A number of years ago Wikibon predicted that cloud, while dominating computing, would not feature all data moving to the cloud but rather, the cloud experience and cloud services moving to the data. We call that true private cloud computing, and there has, nothing has occurred in the last couple of years that has suggested that we were, anyway, wrong about this prediction. In fact, if we take a look at what's going on with Edge, our expectations that increasingly Edge computing and on Premise technology, or needs, would further accelerate the rate at which cloud experiences end up on Premise, end up at the Edge, and that would be the dominant model for how we think about computing over the course of the next few years. That leads to greater distribution of data. That leads to greater distribution of places where data actually will be used. All under the aegis of cloud computing but not utilizing the centralized public cloud model that so many predicted. >> A prediction we'd like to talk about is how multi-cloud and orchestration of those environments fit together. At Wikibon, we've been looking for many years at how digital businesses are going to leverage cloud, and cloud is not a singular entity, and therefore the outcomes that you are looking for, often require that you use more than one cloud, specially if you are looking at public clouds. We've been seeing the ascendance of Kubernetes as a fundamental foundational piece of enabling this multi-cloud environment. Kubernetes is not the sole thing, and of course, you don't want to overemphasize any specific tool, but you are seeing, driven by the CNC AFT in a broad ecosystem, that Kubernetes is getting into all the platforms, both public and private cloud, and that we predict that by 2020, 90% of multi-cloud enterprise applications will use Kubernetes to lead for the enablement of their multicloud strategies. >> One of the biggest challenges that the industry is going to face over the next few years is how to deal with multi-cloud. We predict, ultimately, that a sizable percentage of the marketplace, as much as 90%, will be taking a multi--cloud approach first to how they conceive, build, and operate their high, strategic value applications that are engaging customers, engaging partners, and driving their businesses forward. However, that creates a pressing need for three new classes of Technology. Technology that provides multi-cloud inter-networking; Technology that provides orchestration services across clouds, and finally Technologies that ensure data protection across multi-cloud. While each of these domains by themselves is relatively small today, we think that over the next decade they will, each, grow into market that are tens of billions if not hundreds of billions of dollars in size. >> The picture I'd like to talk about a very few, the Robotic Process Automation, RPA. So we've observed that there's a widening gap between how many jobs are available world wide and the number of qualified candidates to fill those jobs. RPA, we believe, is going to become a fundamental approach to closing that gap, and really operationalizing artificial intelligence. Executives that we talk to in The Cube; They realize they just can't keep throwing bodies at the problem, so this so called "software robots" are going to become increasingly easy to use. And we think that low code or no code approaches to automation and automating work flows are going to drive the RPA market from its current position, which is around a billion dollars to more than ten X, or ten billion dollars plus by 2023. I predict that in 2019 what we are going to see is more containerization of AI machine learning for deployment to the Edge, throughout the multi-cloud. It's a trend that's been going on for some time. In particular, what we are going to be seeing is a increasing focus on technologies, or projects in code base such as Cube flow, which has been established in this year just gone by to support that approach for containerization of AI out to the edges. In 2019, we are going to see the big guys, like Google, and AWS, and Microsoft, and others in the whole AI space begin to march around the need for a common delatched framework suck such as Cube Flow, because really that is where many of their customers are going. The data scientists and App developers who are building these applications; They want to manage these over Kubernetes using these CNC stacks of tooling and projects to enable a degree of supportability and maintain ability and scalability around containerized intelligent applications. >> My prediction is around the move from linear programming and data models to matrix computing. This is a move that's happening very quicly, indeed, as new types of workload come on. And these workloads include AI, VR, AR, Video Gaming, very much at the edge of things. And ARM is the key provider of these types of computing chips and computing models that are enabling this type of programming to happen. So my prediction is that this type of programming is gonna start very quickly in 2019. It's going to rule very rapidly about two years from now, in 2021, into the enterprise market space, but that the preparation for this type of computing and the movement of work right to the edge, very, very close to the senses, very, very close to where the users are themselves is going to accelerate over the next decade. >> The prediction I'd like to make in 2019 is that the CNCF, as the steward of the growing cloud native stack, they'll expand the range of projects to include the frontier topics, really the frontier paradigms, in micro sources in cloud computing; I'm talking about Serverlus. My prediction is that virtual Kubelets will become an incubating project at CNCF to address the need to provide Serverlus event driven interfaces to containerize orchestrated micro sources. I'd also like to predict that VM and container coexistence will proceed apace in terms of a project such as, specially Kubevirt. I think will become also a CNCF project. And I think it will be adopted fairly widely. And one last prediction, in that vein, is that the recent working group that CNCF has established with Eclipse, around IOT, the internet of things. I think that will come to fruition. There is an Eclipse project called Ditto that uses IOT, and AI, and digital twins, a very interesting way for industrial and other applications. I think that will come under the auspices of CNC in the coming year. >> Security remains vexing to the cloud industry, and the IT industry overall. Historically, it's been about restricting access, largely at the perimeter, and once you provide through the perimeter user would have access to an entire organization's resources, digital resources, whether they be files, or applications, or identities. We think that has to change, largely as a consequence of businesses now being restructured, reorganized, and re-institutionalizing work around data. That what's gonna have to happen is a notion of zero trust security is going to be put in place that is fundamentally tied to the notion of sharing data. So, instead of restriction access at the perimeter, you have to restrict access at the level of data. That is going to have an enormous set of implication overall, for how the computing industry works. But two key technologies are essential to making zero trust security work. One is software to find infrastructure, so that you can make changes to the configuration of your security policies and instances by other software and to, very importantly, high quality analytics that are bringing the network and security functions more closely together and through the shared data are increasing the use of AI, the use of machine learning, etc and ensuring higher quality security models across multiple clouds. It's always great to hear from the Wikibon analysts about what is happening in the industry and what is likely to happen in the industry. But now, let's hear from you, so let's jump into the cloud chat as an opportunity for you to present your ideas, your insights, ask your questions, share your experience. What will be the most important trends and issues in 2019 and beyond, as far as you are concerned. Thank you very much for listening. Now let's cloud chat.

>> Live from Orlando, Florida, it's theCUBE! Covering Cisco Live 2018. Brought to you by Cisco, NetApp, and theCUBE's ecosystem partners. (bubbly music) >> Hello everyone and welcome back to the live coverage, here with theCUBE, here in Orlando, Florida, for Cisco Live 2018. I'm John Furrier, my co-host Stu Miniman, for the next three days of wall-to-wall live coverage. We have the co-founders of the Network Collective here Eyvonne Sharp and Jordan Martin, thanks for joining us today, Network Collective. Sounds great, sounds like it's a collection of networks, so what's goin' on, what do you guys do? First let's talk about what you guys do, obviously you guys do a lot of podcasting, a lot of diggin' into the tech, what is Network Collective? >> Network Collective is a video podcast that Jordan and I started. We really felt like there was a need to build community around network engineers, and that really a lot of network engineers are very isolated in their job, there's only a couple people where they work, they know what they know, and they don't have a lot of peers. And so we see Network Collective as a way to bring network engineers together to learn about their craft, and also share with one another in a community that's more than a once-a-year conference like Cisco Live. >> That's awesome, I love the video podcasting, more than ever now the need for kind of peer review, conversations around learning because the world's shifting. In the keynote today the CEO of Cisco talked about the old way, and the new networks that are coming. We've been talking about no perimeters for years, but now security threats are real, gotta keep that strain solid, keep managing that, but also bring in a new kind of a cloud-hybrid, multi-cloud world, requires real skill adoption, new things. What're you guys seeing, what's your thoughts, and what's some of the things that you guys are exploring on your video podcast around these trends? >> You wanna take that Jordan? >> Sure. So, I think the rate of change of networking is faster than it's been in a very long time, so we've, we've had to, we've kinda not had a whole lotta churn in the things we've had to learn, I mean it's been complex and difficult, and there's been challenges in getting up to speed, but, with the transition to more developer-focused, and developer-centric model of deploying equipment, it is--and the integration of cloud into what is essentially our infrastructure. It's changing so much, that it's good to get together and have those conversations because it's very difficult to navigate this by yourself, it's, you know, it's a lot to learn. >> You know, I wanna push back little bit on that 'cause, you know, I've been in networking my whole career. When I used to, I used to speak at Interop, and I'd put down, you know, here's the rate of change, and here are the decades. And it's like, you know, okay 10 gig, here's where the standards are, here's where the first pieces are, it's gonna take years for us to deploy this. I don't disagree that change is happening overall faster, but how are people keeping up with it? Are the enterprises that the networking people work for allowing them to roll out some of these changes a little faster? So, give us a little insight as to what you're hearing from the community? >> I think, I mean technology, I mean, we've got Moore's law, right? I mean technology has always been changing rapidly, I think the thing that is different is the way network engineers need to interact with their environment. Five to 10 years ago, you could still operate in an environment where you still did a lot of static routing, for example. Now, with the cloud, with workloads moving around, there is no way to run a multi-cloud enterprise network without some serious dynamic routing chops, whether that's BGP, or EIGRP, or OSPF, or all of the above, and a lot of network engineers are still catching up with some of those technologies, they're used to being able to do things the way that they've always done them. And I think there needs to be a mind shift where we start thinking about things dynamically, in that, you know, an IP address may not live in the same geography, it may move from on-premises to the cloud to another cloud, and we have to be able to build networks that are resilient enough, and flexible enough, to be able to support that kind of mobility. >> Yeah, I love that Eyvonne. Right, you talked about the multi-cloud world. Jordan, a follow up question I have for you, how does the networking person look at things when there's a lot of the networking that are really outside of their control when you talk about really, the cloud world today. >> Sure, and before we jump there, I wanna say, the change that we're talking about though, is a bit different than what's happened. So, what we've seen traditionally would be speeds and feeds, but what's changing is the way we operate networks, and that hasn't changed a lot. Now, as for, you know, how do you view it when you don't-- well that's a challenge that everyone is facing. We see networking getting further and closer to the host. And, when we see networking inside of VMware, I mean this has been something that's been around for, you know, a while now, but, we're just getting comfortable with the idea of hypervisor, and now we've got, you know, we've got containers, and we've got networking in third party services that we don't necessarily have access to, we don't have full control over, and it's a completely different nomenclature we have to relearn all the terms because of course, no one reused the stuff we were familiar with, because this all started from a developer mindset. It all makes sense where it came from, but now we're catching up. And so it's, the challenge is not only understanding what needs to be done in all these different environments, but also understanding, just the terminology, and what is means. What is a VPC? Well VPC means something completely different to a networker that has never touched Amazon, than it does to somebody who has worked at Amazon completely there's overlapping terms and confusion around that and it's just a matter of, I think you need some broader coordination. There's been discussion about something like a full stack engineer, I think that's a pretty rare thing, I don't know how, how likely it is that you're gonna be expert level in all different disciplines, but you do need, you do need cross-team collaboration more than you have traditionally. We've had these silos, those no longer work in a multi-cloud world, it just doesn't, just doesn't work anymore. >> One of the things that came out with the keynote was, the networks next act was the main theme, as they talked about this new way, I mean, they use secure, intelligent platform, you know, for digital business, you know, level one marketing there, more complex than a few years ago and then the onslaught of new things coming, AI, augmented reality, machine learning, and I'd put blockchain in there, I thought they would put blockchain in the keynote to hype it up a bit, but, then they introduced the multi-cloud concept at that point. So in the keynote, multi-cloud didn't come up until the next act came up, so obviously that is a key part of what we're seeing, we saw Google clouds CEO Diane Greene come on. How are network engineers looking at the multi-cloud? 'Cause, I mean, how are they, toe in the water, are they puttin' the tow in the water? (chuckles) What is multi-cloud to them? Because, I mean, we talk about Kubernetes all the time, from an app standpoint, but, networks have been locked down for many, many years, you talked about some of the chops they need, what are those next chops for a network engineer when it comes to taking the road to multi-cloud? >> Sure, I mean I think if you're going to do any kind of multi-cloud interconnect, you've gotta know VGP. But at the same time, you need to understand some of those fundamental concepts that, the reason developers are pushing to the cloud, is not cost, although I've heard that a lot, that you know this cloud thing can't be cheaper, but it's really about enabling the business to move faster, and so we need to start thinking that way as network engineers more too. We have I think historically, our mentality, we've even trained our network engineers to go slow, to be very deliberate, to plan out your changes, to have these really complex change windows, and we need to start thinking differently, we need to think about how to make modular changes, and to be able to allow our workloads to move and shift in ways that don't provide a lot of risk, and I think that's a new way of thinking for networking engineers. >> Yeah. >> Well, we're sitting here in the DevNet zone, and that was one of the highlights in the keynote, talking that there are over 500 thousand developers now registered on this platform that they've built here. Bring us inside a little bit, you know, is it, what was it, John, DevNet sec? There's all of these acronyms as to, you know, how developers-- >> Yeah, NetApp was their big thing. >> how the network and the operations go together. What are you seeing, what's working, what's some of the challenges? >> I think this is a shift of necessity. As we see more problems solved in the network, we're adding complexity at that layer that hasn't been seen before, before it was routing, we just had to get traffic from one place to another, then we added security, so okay we have security, but we, we create these choke points in security where we can send all the traffic through this place and just like, we can use filtering, or some sort of identification there. Well then we start moving to cloud and we talk about dynamic workloads, and we talk about things that could just shift anywhere in the world, well now our choke point is gone, and so now we have to manage all the pieces, all the solutions, all the things we're putting into the network, but we've gotta manage it in a distributed way. And so that's where I think the automation's, why it's such a big push right now is because, we have to do it that way, there's no way to manually put these features in the network and be able to manage them at any type of scale without automating that process, and that's why, I think, we see the growth of DevNet, I mean, if you've been here the past few years, it's gone from a little thing to a much, much bigger thing, there's a lot of people looking at automation specifically, that 500 thousand number is, rather large. Really impressive that there's that many people looking at networks from a programmatic way. But in the meantime, I think that there's also, a bit of a divide here, 'cause I think that there's, a lot of people are looking this way, but I think there's, we talk about this on the show pretty often, there's really two types of networks. There's the networks at companies where, it really is, they see their network as a competitive advantage, and those places are definitely looking at automation, and they're looking at multi-cloud. But we also see another trend in networking, and that is to, I want some simple, push button, just put it out, get packets A to B, and I don't wanna mess with it, I don't want expensive engineers on staff, I don't want-- So I feel like the industry's almost coming to a divide. That we're gonna have two different types of networks, we're gonna have the network for the place that the just want packets going A to B, and they really don't want much, and the other side of that divide is gonna be very complex networks that have to be managed with automation. >> Talk about that other divide, it's between, I mean, I love that conversation, because, that almost kinda comes into like the notion of networks as a service. Because if you wanna have less expensive people there, but yet have the reliability, how do those companies grow and maintain the robust resiliency of these networks, and have the high performance, take advantage of the goodness, well what does it matter? I mean, how are they, how is the demographic of the network evolving, 'cause, either they're stunted for growth, or they have an enabler. How do you view that, how do you take that apart? >> I think we have to, we have to look at our business needs, and evaluate the technologies that we use appropriate to that. There are times for complexity, I think we've pushed, as Jordan very eloquently described, a lot of complexity down into the network, and we're working, I think, now, as the entire industry to maybe back some of that out. But one of the things that I hear a lot when we talk about automation and things like DevNet and developers is, I believe a lot of network engineers are afraid their jobs are going away, but if you look at what's going on, we have more connected devices than we've ever had before, and that's not gonna stop, and all of those connected devices need networks. And so really what's happened is we've reached a complexity inflection point, which means we have to have better tools, and I think that's really what we're talking about is, is how do we, instead of doing everything manually, how do we look at the network as a system, and manage it as a system, with tools to manage it that way. >> Your point about that jobs going away, I love that comment because, that's a sunk fallacy because, there's so much other stuff happening, talk about security, so the basic question, I mean first of all, guys your job's not goin' away! (laughs) Check! It's only a, well, kind of, you don't stay current, so it's all the learning issues, the progression for learning. But really it's the role of the network engineers and the people running the networks, I mean, I remember back in, the old way, the network guys were the top dogs, they were kickin' butt, takin' names, they ran the show, a lot was riding on the network. But as we go into this new dynamic environment, what are the roles of the network? Is it security? I mean, what are some of the things that people are pivoting to, or laddering up to from a roles standpoint that you see, in terms of a progression of new discovery, new skills. Is there a path, have you seen any patterns, for the growth of the person? >> I really think network engineers need to at least understand what the cloud is and why it exists. And they need to understand more about the applications and what they mean to the business. I think we have created a divide sometimes where, you know, my job is just to get packets from point A to B, and I don't really need to understand what we do as an organization, and I think that those days are going to be behind us, we need to understand, you know, what applications are critical, why do we need to build the systems the way that we need to build them and use that information from the business? So I think for network engineers, I think cloud security, understanding applications, and learning the business and being able to talk that language is what's gonna be most valuable to them in their career in the future. >> Yeah, we've heard the term many times, I'm a plumber! Well, I mean, implying that moving packets from A to B. It gets interesting with containers. Policy-based stuff has been known concept in networking, QOS, these are things that are well known, but when we start lookin' at the trends up the stack, we're seeing that kinda thing goin' on, service meshes for instance, they talk about services from a policy standpoint, up the stack. That's always been the challenge for the Ciscos over the past 20 years is, how to move up the stack, should they move up the stack, but I think now seems to be a good time. Your reaction guys, to that notion of moving up the stack while maintaining the purity and the goodness of good networking. (laughing) >> I think that's the big challenge right now, right? The more we mesh it all together and we don't, we don't really define the layers that we've traditionally used, the more challenging it is to have experts in that domain, because the domain just grows so incredibly large. And so there's gotta be a balance here, and I think we're trying to find that, I don't know that we've hit that yet, you know where, where we understand where networking fits into all these pieces, how far into the host, or how far into the application does networking go, we've seen certain applications not using the host TCP/IP stack, right, just to find some sort of performance benefit and it, to me that seems like we're pushing really far into this idea of, you know, well if we don't have standards and define places where these things exist, it's gonna be very much the wild, wild west for a while, until we figure out where everything's going to be. And so I think it just presents challenges and opportunities I don't know that we have the answer about how far it goes yet. >> Well let me ask you a question, a good point by the way, we agree, it's evolving, it's a moving train as they say. But as, people that might be watching that might be a Cisco customer or someone deploying a lot of Cisco networks and products in his portfolio, what's your advice to them, what're you hearing that's a good first three steps to take today? Obviously the show's goin' on here, multi-cloud is in center of the focus, this new network age is here for the CEO. What are some things that people can do now that are safe and good first steps to continue on the journey to whatever this evolves into. >> Well I think as you're building your network you need to think about modularization, you need to think about how to build it in small, manageable pieces, and, even if you're not ready to take the automation step today, you need to think about what that's gonna look like in the future, so, if you really want to automate your network you have to have consistency, consistent policy, consistent configuration across your environment, and it's never too late to start that, or too early to start that, right? And so you can think about, if I wanted to take these 10 sites and I wanted to manage them as one, how would I build it? And you can use that kind of mental framework to help guide the decisions you make, even if you're not ready to jump into a full scale automation from soup to nuts. And also I think, it's important to start playing around with automation technology, there are all kinds of tools to do that, and you can start in an are that's either dev, or QA, that's not gonna be production impacting, but you really need to get your, wrap your hands around some of the tools that exist to automate, and start playing with those. >> Stay where you're comfortable, get in, learn, get hands on. Jordan, your thoughts? >> Yeah, so, I was just over here like nodding my head furiously, 'cause everything she said, I 100% agree with. >> Ditto. (laughing) >> Yes, ditto, exactly. The only thing I would add is that we think about automation a lot in the method of config push. Right, the idea of configuring a device in an automated way, but that's not the only avenue for automation. Start by pulling information from your devices, it is really, really low risk way to start looking at your network programmatically, is to be able to go out to all of your switches, all of your routers, all of your networking devices and pull the same information and correlate that data and get yourself some information that's with a broader view. Does nothing to effect the change or state of your network, but you are now starting to look at your network that way. And I will reiterate Eyvonne's point, you cannot automate a network if it's not repeatable. If every design, every topology, every location is a special snowflake, you will never be able to automate anything because you're gonna have a hundred unique automation scripts to run a hundred unique sites. >> You'd be chasin' your tail big time. >> You'd be chasin' your tail, and so it is critical, if you're not in that state now, what you need to do is start looking how to modularize, and make repeatable config blocks in your network. >> Well guys, thanks for comin' on, Eyvonne, Jordan, thanks for comin' on, appreciate you taking the time. Final question for ya, I know it's day one, we got two more days of live coverage here, but, if you can kinda project, and in your minds eye see the development of the show, what's bubbling up as the most important story that's gonna come out of Cisco Live if you had to look at some early indications from the keynotes and some of the conversations in the hallway, what do you think is the biggest story this year for Cisco Live? >> I think for me personally, I wanna understand what Cisco's cloud strategy looks like, to know where they're going with the cloud and how they're going to help stitch together all the different services that we have. The clouds are becoming their own monolith, they each do things their own way, and still the network is what is stitching all those services together to provide access. And so I think it's important to understand that strategy, and where Cisco's goin'. >> Jordan, your thoughts? >> My, what I'm really looking for from the show this year is how Cisco is gonna make orchestration approachable. We've seen this process of automation where only the hardcore programmers could do it, then we got some tools. And these tools, as we watch as more of Cisco's product platforms start to integrate with each other I think the key piece for enterprise shops that don't have that type of resource on staff is what tools are they gonna give them to make this orchestration, between the way in and the enterprise campus, and into the cloud and in the data center, how do we tie all that together and make that to like a nice, seamless way to operate your network? >> Hey, what a great opportunity to have another podcast called under the hood, see what's goin' on, lot of chops needed, thanks for comin' on, give a quick plug for the address for your podcast, where do we find it, what's the site, Network Collective, obviously you guys are doing great things. Share the coordinates. >> Sure, you can find us at thenetworkcollective.com we usually use the hashtag: #NetworkCollective I'm on Twitter @SharpNetwork. Jordan, you wanna tell people where to find you? >> Sure, @bcjordo on Twitter, and obviously if you wanna interact with Network Collective, @NetCollectivePC on Twitter as well. >> Alright, thanks so much for the commentary, great to have a little shared, little podcast here, live on theCUBE, here in Orlando, I'm John Furrier, with Stu Miniman for our coverage at Cisco Live 2018, stay with us for more, we've got two more days of this, got day one just gettin' started, be right back after this short break. (bubbly music)