(upbeat music) >> Hey welcome back everybody, Jeff Frick here with theCUBE. We are live at Moscone Center at the RSA Convention. 40,000 security professionals are here, talking about security. This thing grows every single year. We're happy to be here and excited for our next guest, Ajay Gupta. He's the Global Director, Product Marketing and Management from Huawei. Welcome. >> Oh thank you, Jeff. Pleasure to be here. Thanks for your time. >> Absolutely, so you've been coming here for years. You laughed at me when I asked how long you've been coming here. >> Oh it's been ages, you can look at me and you can imagine. >> No, look, all hairs still dark. >> Oh come on, you're being too nice to me. >> So what's really changed, as you've been coming for years. Kind of at a global perspective? >> Yeah, yeah I think we've seen the nature of security change, the nature of threats change. The different companies have changed actually over the years. The crowd has gone up and swelled like 40,000 you mentioned. So, we really think this show has really become the gold standard for the trade shows when it comes to security. We weren't there at RSA but last few years we have made it a point to be here every year to talk to the customers here. >> Yeah. >> And you meet all the people from all over the world. That's the best part, customers, partners, everybody. >> It's interesting because a big part of the theme here is collaboration and ecosystem. And nobody can do it alone. Everyone covers different pieces of the puzzle. I know you guys are trying to grow your ecosystem. What does ecosystem mean to Huawei? >> Absolutely. I think we do believe from a security perspective no single vendor can offer the best of the breach security to their customers. We really need partners, the ecosystem. Huawei has something called being integrated. That is, bringing the partners onboard to offer different pieces of the puzzle. In fact it's a good point to mention. We are announcing two announcements this morning actually. The first one what we'll talk about is Avira. It's the best AV engine company in Germany. Huawei really recognizes the importance of the AV. So we are bringing their AV engine on the Huawei's next generation firewall. It really brings two things. Performance and accuracy. That's what people need from a AV point of view. The second announcement we're going to make really is what's called the Huawei USG9000V. It's a security gateway actually. So as the cloud's proliferation, as people are moving to the cloud, as people are using more and more SAS applications, you're going to see lot more security building from the cloud perspective. Our USG9000V is actually the perfect gateway to combat the security threats in the cloud. So virtual data centers, the cloud data centers, the OTT's, we really bring all the different kinds of security in the USG9000V. The announcement we are making is really an upgraded version of the existing security appliance that we call 6000V. Again, it's a software security. Works with different VMs whether it's KVM, whether it's zen, whether MS6. Huawei's own virtual system. Huawei's FushionSphere. The performance is in terabit so you can actually go in and read some of the specs from the Huawei's perspective. One of the best of the V products for virtual security. >> Right. And the cloud's changed everything, right? So many applications are delivered via the cloud now. And even if it's not a cloud and it's an internal cloud people want the flexibility of cloud. They want to scalability of cloud. They really want the way the cloud works for them to deliver the applications to their customers and their employees. >> Definitely. So three things I'm going to mention here from a cloud perspective. What people are looking for from a cloud security perspective is on demand. How do you scale in, scale out as the demands of the bandwidth goes up. You got to make sure your network security is able to keep up with that demand. People are looking for visibility. You've got this multitude of appliances, boxes, cloud boxes, cloud security all over the place. How do you make sense out of it? How do you really bring all of those thresholds, all of those unloads come together into the form of CIO or CSO can really understand. >> Right. >> And the last thing I'm going to make it easy to configure. PLug and play. Some of the automation feature. Automation people are starting to move in the security but you got to be careful when you bring automation from a security perspective. You need to automate task that are not that mission critical. But as we more and more trust, you're going to see more security automation in the industry. >> Yeah. Because when it's cloud it just needs to work, right. Everybody just expects, I can add more capacity, I can spin it down. And it just needs to work. It's somebody else's problem, it's somebody else's data center. >> I don't know what's going on behind the scenes, I just know it works. >> Yeah. >> I pick up my phone, it's going to kick. That's exactly the concept of security. But you got to be really careful when it comes to security because you got to make sure that when, suppose the positive threats and positive and negative threats actually. How do you combat and make sure you automate from the positive point of view and not from a negative point of view. >> But there's one thing that hasn't changed, cloud or no cloud. And they talked about it in the keynote and that great line was every company has at least one person that will click on anything. (laughs) >> Oh, I love it. I love it actually. >> How do we get past, I mean, they're still getting the email from the African king who needs some dollar >> Nigeria, Nigeria >> For Nigeria. >> Let me put I this way. I would say hackers are getting smarter and smarter. How do you keep up with the threats from the hackers who are one step ahead of you. How do you really combat threats, unknown threats, in the future? So I think things we have seen in 2016, the phishing attacks are back on the rise actually. Always do you see Ransomware. Form the point of Ransomware I should mention there's something called par pon ton from Ransomware that I'm going to let you off the hook if you infect two other computers actually. I don't need the money from you. So hackers are coming with those innovations to really go and hack more people actually. You seen what happened with the collected costs. Chrysler had a recall on 1.4 million vehicles in the past. Do you see what's happened with the camera, the surveillance camera. So I think two things we really need to watch out in 2017. One is Ransomware and the number two thing which is extremely, extremely important is industrial IOT actually. >> Absolutely. >> As the sensors get deployed more and more around the world you've got to make sure those sensors are able to keep up with the threat, it's not easy. So what Huawei provides to the table is really end to end security. Two things in security; multi-layered security and security indifference. Those are the principles from the bottom, not from the top down. >> Right. It's funny, the funniest, it's not funny really. The Ransomware story was fake Ransomware. I didn't really put Ransomware on your machine I just told you that I did so go ahead and pay me anyway. And the other thought is really the ability for them to build a business because of Bitcoin as a way to collect anonymous money from people. That enabled a rise in the escalation in Ransomware. It's a complicated world. They give you the last take as people drive away, leave RSA 2017, really what should be the top of mind as they think about what's going to happen and what we'll be talking about when we come back a year from now? >> I think two things I would really suggest people to really take away from the RSA this year. First of all, what's happening in the industry? What's happening in the market? Keep updated with the latest threat. See what vendors had a very comprehensive solution from an end to end perspective. Really go do their own research, making sure that security is not an after thought. Security it needs to be proactive. Security needs to be built up from ground up. Don't regard security as something secondary actually. As long as people put premium on security, that's going to save their face rather than to be appearing on the Wall Street front page or have been hacked. They say there are two kinds of companies. 50% claim that they have been hacked. 50% know they just don't admit it. That's all. >> Alright, very good. Well Ajay thanks for stopping by and congrats on a great show. >> My pleasure, thanks Jeff. Thank you very much. >> He's Ajay Gupta, I'm Jeff Frick. You're watching theCUBE from RSA conference in downtown San Francisco. Thanks for watching. (upbeat music)

(upbeat techno music) (upbeat techno music) >> Hey welcome back everybody, Jeff Frick here with the Cube, We're in downtown, San Francisco at the RSA Conference. It's like 40,000 people, security people, talking about security. It's a new age in security, with all the things that happened with the election, and all types of interesting phishing attacks, and a lot of professionals here trying to stop the problem. So we're excited to be joined by our next guest, Ian Foo. He's the Director of Product Marketing from Hauwei, Ian welcome. >> Thank you, thank you Jeff, it's good to be here. Glad to join everyone here, it's pretty exciting, very busy. >> Yeah, it's very busy. >> Yep we're here showing what Hauwei has to offer in the market, and what we're highlighting this year at RSA. There are three main areas that we're trying to bring attention to. One of those is the latest in terms of our functional capabilities and offerings in our network security portfolio. So our network security devices. The other is what we're doing in our ecosystem partnership. We're expanding our partnerships, trying to build an ecosystem with industry leading partners. So it'll be well to bring better value to the end users and to our customers. And the third is what we're offering in terms of new platforms and capabilities in technologies, in our innovation in cloud infrastructure security. Helping cloud providers or enterprisers add security to their private cloud, or their cloud service infrastructure. >> Alright so let's unpack those a little bit. >> Sure. >> So the first one is really the cloud. >> Ian: Yes. >> You know, ovbiously with the rise of AWS really driving public cloud. >> [Ian} Yep. >> There's no longer a question and apps like Sales Force. >> Ian: Right. The enterprise is pretty comfortable with cloud. >> Ian: Right. >> How has that really changed your world from a security perspective, supporting public cloud providers? >> Ian: Yep. >> Private cloud providers, and then of course hybrid cloud inside the enterprise that still want to deliver kind of cloud agility, cloud flexibility? Right, so it's actually changed the landscape in quite a few ways. When we move from traditional security within the enterprise, and expand that to cloud service providers, and enterprisers trying to build private cloud, we're looking at a few things that have evolved. We're looking at scale, first and foremost. That's the one that pops into most people's mind. Now, especially in a cloud service provider environment, we're providing services to potentially thousands of customers. Scale reliability, availability becomes critical. Those are areas that we've traditionally excelled in. But what's evolving is the way threats are addressed and recognized, and the way policy is pushed within those environments. So for their customers, cloud service providers are looking for ways to be able to provide policy capabilities that match what the enterpriser is used to in their environment. So we tried to build the technologies and tools that enable cloud service providers to do exactly that. >> Right. >> Provide enterprise class-compliant security capabilities, defense against DDoS attacks within their cloud infrastructure for those enterprisers. >> Yeah it's interesting in the keynote, they talked about every company has at least one person that will click on anything. >> Ian: Right. >> Right. And they also talked about kind of the increased attack area of people's homes. >> Ian: Right. >> Because a lot more people now work from homes. >> Ian: Correct. >> Right? They're accessing the corporate networks. >> Ian: Yep. >> The corporate application. >> That's right. >> From their home, from the coffee shop on their phone. >> Absolutely. >> So that's changed the... >> From their cars. >> The landscape quite a bit. >> Right from yeah... >> And not to mention the cars. >> Yeah so that absolutely has. Again it goes back to what I mentioned earlier. Scale, so now we're looking at a widened threat base, or a widened threat surface, if you will. Especially when it comes to not just consumers, from mobile devices, home access, but now IoT. And when we expand IoT to both, to the industrial Iot as well as consumer Iot, what we're seeing is many more entrance points into what we consider the enterprise space. >> Right. >> And so now securing all of those points of presence, and applying a multi-layered approach to security, becomes much more complicated. And that's where we try to develop the technologies and innovations driven by our customers to help them solve those problems. >> Right, which also kind of drives into one of your other points, is ecosystem. >> Ian: Right. >> Right so we cover a lot of tech shows. >> Ian: Absolutely. >> We got 100 shows a year. And everyone is trying to build an ecosystem because you can't just do it alone. >> Ian: That's right. >> And one of the big themes that came out again, out of the keynote, is this idea of yes we compete, yes there's 40,000 people here. I don't even know how many companies, but we compete on different places. But if we share bad guy information... >> Ian: That's correct. >> ...Effectively, efficiently, it helps us all out in keeping our customers safe. >> Absolutely, absolutely so it's all about ecosystems, because, I think, for a true multi-layered approach, multi-perspective approach to security, it's all about teamwork. Right and as you said, we cant be an expert at everything. We have to recognize, each vendor has to recognize where they're strengths lie, where their fortes are, where their expertise is, and then partner to complement that to provide that multi-layered approach that the end user is looking for. >> Right. >> And that's what we're trying to do. Here we have announced quite a few partnerships. We have aligned with notable names in the industry. Such as, Intel-McAfee, Avira, AlgoSec, and we're working with companies like FireMon, to help build that ecosystem partnership to create that team effect. >> Right >> In providing multi-layered approach, best in breed, multi-layered approach to security in the enterprise. >> Interesting this morning I don't know if that was breaking news, or I just was behind the news, that McAfee is actually going to spin out of Intel and be a wholly-owned company. >> Yeah I heard a little bit about that. Yeah, it's interesting, it's a very dynamic industry. It constantly changes, ongoing here and there. >> Right. That can be great, it allows people to focus in certain ways. But yeah, not surprising there is constant changes in this industry. >> Right, but then the one thing that's stayed the same but is still growing in importance even with cloud, you still have the enterprise data center. >> Ian: Absolutely. Right and those things continue to grow and are very, very important. >> Right. >> And there's just a lot of stuff that's not going to make it to cloud. So how have you seen kind of the enterprise data center kind of situation change? >> Ian: Yep. >> With these new threats, with clouds, with hybrid? >> Right, well so what we're seeing, especially in the enterprise data center is, we're seeing an evolution from traditional fireball security, which is still necessary. But we're seeing that, the attacks and the access points are becoming more sophisticated. We're seeing progression in ransomware and advanced persistent threats. It goes back to what you said before, a component is that there's always going to be that guy that clicks on anything. >> Right. >> And it could, who knows that thing could be? So what we're seeing there is an evolution of security and awareness to the point of customers asking for awareness to applications, to files, to contents. So to that notion, some of the things we're announcing here and sharing with our customers and potential customers, our technologies to help prevent ransomware, our platform like our Firehunter, a sandboxing technology, which provides defenses against advanced persistent threats, as well inline, streaming-based, security capabilities, where we partnered for example with Avira. We complement our network-based security, for streaming inspection of files and contents and streams. We complement that with their abilities in malware and signature-based recognition, to provide a multi-layered, comprehensive approach to dealing with the new types of security threats we're seeing. >> Right, so Ian you been comin to the show for awhile, you've been in the industry for long time. >> Ian: Yep, it's been a bit. >> There's 40,000 people, what's kind of your take, kind of take it a step back from the specifics, >> Ian: Right. >> Like kind of the evolution of the security industry I think... >> Ian: Yep. >> One of the stats I heard the other day is like, 1.5% of the IT spend was for security. Now that's up to like five or ten. >> Ian: Right, right. >> It's growing in importance, but the technology out in front of the security is just rockin and rollin. >> Ian: Right. >> And IoT and 5G is just the next kind of big wave comin. >> Correct >> So, what's kind of your perspective as you look back and kind of look forward? >> Well it's obvious, it's very obvious, from just the numbers you sharing that, rather than be peripheral to the business, security is now core to the business. Instead of just supporting business, it's become a key piece to being able to deliver business reliably. And I think that enterprisers have recognized that. What's happening is that we're seeing an acceleration in the evolution of threats, in the entrance vectors in the various areas. Because of the adoption rate and snowballing effect that we're seeing in technology in general. And I think that security has become better at trying to keep up with that pace, rather than falling behind the curve as we have in the past. Mainly because enterprisers recognized the relevance and importance of it. So we're no longer selling insurance, when we sell security, we're selling business-enabling value, and how we protect brand recognition and brand capabilities for our end users and customers. >> It's a whole nother kettle a fish. >> Ian: Right. >> That we don't have time to get into right now but we went to a presentation last night about the whole insurance angle on... >> Ian: Right. >> On security, which is, like I said, is a whole different kettle a fish. We'll save that for next time so Ian... >> Sounds good. >> Thanks for stoppin by. >> Great well thanks for having us. Great being here with you and enjoy the show. >> Absolutely, he's Ian Foo, I'm Jeff Frick, you're watching The Cube from RSA Conference in San Franciso. (quiet techno music) (upbeat techno music) (upbeat techno music)

(upbeat music) >> Hey welcome back everybody, Jeff Frick here with theCUBE. We are live at Moscone Center at the RSA Convention. 40,000 security professionals are here, talking about security. This thing grows every single year. We're happy to be here and excited for our next guest, Ajay Gupta. He's the Global Director, Product Marketing and Management from Huawei. Welcome. >> Oh thank you, Jeff. Pleasure to be here. Thanks for your time. >> Absolutely, so you've been coming here for years. You laughed at me when I asked how long you've been coming here. >> Oh it's been ages, you can look at me and you can imagine. >> No, look, all hairs still dark. >> Oh come on, you're being too nice to me. >> So what's really changed, as you've been coming for years. Kind of at a global perspective? >> Yeah, yeah I think we've seen the nature of security change, the nature of threats change. The different companies have changed actually over the years. The crowd has gone up and swelled like 40,000 you mentioned. So, we really think this show has really become the gold standard for the trade shows when it comes to security. We weren't there at RSA but last few years we have made it a point to be here every year to talk to the customers here. >> Yeah. >> And you meet all the people from all over the world. That's the best part, customers, partners, everybody. >> It's interesting because a big part of the theme here is collaboration and ecosystem. And nobody can do it alone. Everyone covers different pieces of the puzzle. I know you guys are trying to grow your ecosystem. What does ecosystem mean to Huawei? >> Absolutely. I think we do believe from a security perspective no single vendor can offer the best of the breach security to their customers. We really need partners, the ecosystem. Huawei has something called being integrated. That is, bringing the partners onboard to offer different pieces of the puzzle. In fact it's a good point to mention. We are announcing two announcements this morning actually. The first one what we'll talk about is Avira. It's the best AV engine company in Germany. Huawei really recognizes the importance of the AV. So we are bringing their AV engine on the Huawei's next generation firewall. It really brings two things. Performance and accuracy. That's what people need from a AV point of view. The second announcement we're going to make really is what's called the Huawei USG9000V. It's a security gateway actually. So as the cloud's proliferation, as people are moving to the cloud, as people are using more and more SAS applications, you're going to see lot more security building from the cloud perspective. Our USG9000V is actually the perfect gateway to combat the security threats in the cloud. So virtual data centers, the cloud data centers, the OTT's, we really bring all the different kinds of security in the USG9000V. The announcement we are making is really an upgraded version of the existing security appliance that we call 6000V. Again, it's a software security. Works with different VMs whether it's KVM, whether it's zen, whether MS6. Huawei's own virtual system. Huawei's FushionSphere. The performance is in terabit so you can actually go in and read some of the specs from the Huawei's perspective. One of the best of the V products for virtual security. >> Right. And the cloud's changed everything, right? So many applications are delivered via the cloud now. And even if it's not a cloud and it's an internal cloud people want the flexibility of cloud. They want to scalability of cloud. They really want the way the cloud works for them to deliver the applications to their customers and their employees. >> Definitely. So three things I'm going to mention here from a cloud perspective. What people are looking for from a cloud security perspective is on demand. How do you scale in, scale out as the demands of the bandwidth goes up. You got to make sure your network security is able to keep up with that demand. People are looking for visibility. You've got this multitude of appliances, boxes, cloud boxes, cloud security all over the place. How do you make sense out of it? How do you really bring all of those thresholds, all of those unloads come together into the form of CIO or CSO can really understand. >> Right. >> And the last thing I'm going to make it easy to configure. PLug and play. Some of the automation feature. Automation people are starting to move in the security but you got to be careful when you bring automation from a security perspective. You need to automate task that are not that mission critical. But as we more and more trust, you're going to see more security automation in the industry. >> Yeah. Because when it's cloud it just needs to work, right. Everybody just expects, I can add more capacity, I can spin it down. And it just needs to work. It's somebody else's problem, it's somebody else's data center. >> I don't know what's going on behind the scenes, I just know it works. >> Yeah. >> I pick up my phone, it's going to kick. That's exactly the concept of security. But you got to be really careful when it comes to security because you got to make sure that when, suppose the positive threats and positive and negative threats actually. How do you combat and make sure you automate from the positive point of view and not from a negative point of view. >> But there's one thing that hasn't changed, cloud or no cloud. And they talked about it in the keynote and that great line was every company has at least one person that will click on anything. (laughs) >> Oh, I love it. I love it actually. >> How do we get past, I mean, they're still getting the email from the African king who needs some dollar >> Nigeria, Nigeria >> For Nigeria. >> Let me put I this way. I would say hackers are getting smarter and smarter. How do you keep up with the threats from the hackers who are one step ahead of you. How do you really combat threats, unknown threats, in the future? So I think things we have seen in 2016, the phishing attacks are back on the rise actually. Always do you see Ransomware. Form the point of Ransomware I should mention there's something called par pon ton from Ransomware that I'm going to let you off the hook if you infect two other computers actually. I don't need the money from you. So hackers are coming with those innovations to really go and hack more people actually. You seen what happened with the collected costs. Chrysler had a recall on 1.4 million vehicles in the past. Do you see what's happened with the camera, the surveillance camera. So I think two things we really need to watch out in 2017. One is Ransomware and the number two thing which is extremely, extremely important is industrial IOT actually. >> Absolutely. >> As the sensors get deployed more and more around the world you've got to make sure those sensors are able to keep up with the threat, it's not easy. So what Huawei provides to the table is really end to end security. Two things in security; multi-layered security and security indifference. Those are the principles from the bottom, not from the top down. >> Right. It's funny, the funniest, it's not funny really. The Ransomware story was fake Ransomware. I didn't really put Ransomware on your machine I just told you that I did so go ahead and pay me anyway. And the other thought is really the ability for them to build a business because of Bitcoin as a way to collect anonymous money from people. That enabled a rise in the escalation in Ransomware. It's a complicated world. They give you the last take as people drive away, leave RSA 2017, really what should be the top of mind as they think about what's going to happen and what we'll be talking about when we come back a year from now? >> I think two things I would really suggest people to really take away from the RSA this year. First of all, what's happening in the industry? What's happening in the market? Keep updated with the latest threat. See what vendors had a very comprehensive solution from an end to end perspective. Really go do their own research, making sure that security is not an after thought. Security it needs to be proactive. Security needs to be built up from ground up. Don't regard security as something secondary actually. As long as people put premium on security, that's going to save their face rather than to be appearing on the Wall Street front page or have been hacked. They say there are two kinds of companies. 50% claim that they have been hacked. 50% know they just don't admit it. That's all. >> Alright, very good. Well Ajay thanks for stopping by and congrats on a great show. >> My pleasure, thanks Jeff. Thank you very much. >> He's Ajay Gupta, I'm Jeff Frick. You're watching theCUBE from RSA conference in downtown San Francisco. Thanks for watching. (upbeat music)

>> Narrator: TheCUBE's live coverage is made possible by funding from Dell Technologies. Creating technologies that drive human progress. (light airy music) >> Hi, everybody, welcome back to the Fira in Barcelona. My name is Dave Vellante. I'm here with my co-host Dave Nicholson. Lisa Martin is in the house. John Furrier is pounding the news from our Palo Alto studio. We are super excited to be talking about cloud at the edge, what that means. Charles Tsai is here. He's the Senior Director of product management at Dell Technologies and Peter Fetterolf is the Chief Technology Officer at ACG Business Analytics, a firm that goes deep into the TCO and the telco space, among other things. Gents, welcome to theCUBE. Thanks for coming on. Thank you. >> Good to be here. >> Yeah, good to be here. >> So I've been in search all week of the elusive next wave of monetization for the telcos. We know they make great money on connectivity, they're really good at that. But they're all talking about how they can't let this happen again. Meaning we can't let the over the top vendors yet again, basically steal our cookies. So we're going to not mess it up this time. We're going to win in the monetization. Charles, where are those monetization opportunities? Obviously at the edge, the telco cloud at the edge. What is that all about and where's the money? >> Well, Dave, I think from a Dell's perspective, what we want to be able to enable operators is a solution that enable them to roll out services much quicker, right? We know there's a lot of innovation around IoT, MEG and so on and so forth, but they continue to rely on traditional technology and way of operations is going to take them years to enable new services. So what Dell is doing is now, creating the entire vertical stack from the hardware through CAST and automation that enable them, not only to push out services very quickly, but operating them using cloud principles. >> So it's when you say the entire vertical stack, it's the integrated hardware components with like, for example, Red Hat on top- >> Right. >> Or a Wind River? >> That's correct. >> Okay, and then open API, so the developers can create workloads, I presume data companies. We just had a data conversation 'cause that was part of the original stack- >> That's correct. >> So through an open ecosystem, you can actually sort of recreate that value, correct? >> That's correct. >> Okay. >> So one thing Dell is doing, is we are offering an infrastructure block where we are taking over the overhead of certifying every release coming from the Red Hat or the Wind River of the world, right? We want telcos to spend their resources on what is going to generate them revenue. Not the overhead of creating this cloud stack. >> Dave, I remember when we went through this in the enterprise and you had companies like, you know, IBM with the AS400 and the mainframe saying it's easier to manage, which it was, but it's still, you know, it was subsumed by the open systems trend. >> Yeah, yeah. And I think that's an important thing to probe on, is this idea of what is, what exactly does it mean to be cloud at the edge in the telecom space? Because it's a much used term. >> Yeah. >> When we talk about cloud and edge, in sort of generalized IT, but what specifically does it mean? >> Yeah, so when we talk about telco cloud, first of all it's kind of different from what you're thinking about public cloud today. And there's a couple differences. One, if you look at the big hyperscaler public cloud today, they tend to be centralized in huge data centers. Okay, telco cloud, there are big data centers, but then there's also regional data centers. There are edge data centers, which are your typical like access central offices that have turned data centers, and then now even cell sites are becoming mini data centers. So it's distributed. I mean like you could have like, even in a country like say Germany, you'd have 30,000 soul sites, each one of them being a data center. So it's a very different model. Now the other thing I want to go back to the question of monetization, okay? So how do you do monetization? The only way to do that, is to be able to offer new services, like Charles said. How do you offer new services? You have to have an open ecosystem that's going to be very, very flexible. And if we look at where telcos are coming from today, they tend to be very inflexible 'cause they're all kind of single vendor solutions. And even as we've moved to virtualization, you know, if you look at packet core for instance, a lot of them are these vertical stacks of say a Nokia or Ericson or Huawei where you know, you can't really put any other vendors or any other solutions into that. So basically the idea is this kind of horizontal architecture, right? Where now across, not just my central data centers, but across my edge data centers, which would be traditionally my access COs, as well as my cell sites. I have an open environment. And we're kind of starting with, you know, packet core obviously with, and UPFs being distributed, but now open ran or virtual ran, where I can have CUs and DUs and I can split CUs, they could be at the soul site, they could be in edge data centers. But then moving forward, we're going to have like MEG, which are, you know, which are new kinds of services, you know, could be, you know, remote cars it could be gaming, it could be the Metaverse. And these are going to be a multi-vendor environment. So one of the things you need to do is you need to have you know, this cloud layer, and that's what Charles was talking about with the infrastructure blocks is helping the service providers do that, but they still own their infrastructure. >> Yeah, so it's still not clear to me how the service providers win that game but we can maybe come back to that because I want to dig into TCO a little bit. >> Sure. >> Because I have a lot of friends at Dell. I don't have a lot of friends at HPE. I've always been critical when they take an X86 server put a name on it that implies edge and they throw it over the fence to the edge, that's not going to work, okay? We're now seeing, you know we were just at the Dell booth yesterday, you did the booth crawl, which was awesome. Purpose-built servers for this environment. >> Charles: That's right. >> So there's two factors here that I want to explore in TCO. One is, how those next gen servers compare to the previous gen, especially in terms of power consumption but other factors and then how these sort of open ran, open ecosystem stacks compared to proprietary stacks. Peter, can you help us understand those? >> Yeah, sure. And Charles can comment on this as well. But I mean there, there's a couple areas. One is just moving the next generation. So especially on the Intel side, moving from Ice Lake to the Sapphire Rapids is a big deal, especially when it comes to the DU. And you know, with the radios, right? There's the radio unit, the RU, and then there's the DU the distributed unit, and the CU. The DU is really like part of the radio, but it's virtualized. When we moved from Ice lake to Sapphire Rapids, which is third generation intel to fourth generation intel, we're literally almost doubling the performance in the DU. And that's really important 'cause it means like almost half the number of servers and we're talking like 30, 40, 50,000 servers in some cases. So, you know, being able to divide that by two, that's really big, right? In terms of not only the the cost but all the TCO and the OpEx. Now another area that's really important, when I was talking moving from these vertical silos to the horizontal, the issue with the vertical silos is, you can't place any other workloads into those silos. So it's kind of inefficient, right? Whereas when we have the horizontal architecture, now you can place workloads wherever you want, which basically also means less servers but also more flexibility, more service agility. And then, you know, I think Charles can comment more, specifically on the XR8000, some things Dell's doing, 'cause it's really exciting relative to- >> Sure. >> What's happening in there. >> So, you know, when we start looking at putting compute at the edge, right? We recognize the first thing we have to do is understand the environment we are going into. So we spend with a lot of time with telcos going to the south side, going to the edge data center, looking at operation, how do the engineer today deal with maintenance replacement at those locations? Then based on understanding the operation constraints at those sites, we create innovation and take a traditional server, remodel it to make sure that we minimize the disruption to the operations, right? Just because we are helping them going from appliances to open compute, we do not want to disrupt what is have been a very efficient operation on the remote sites. So we created a lot of new ideas and develop them on general compute, where we believe we can save a lot of headache and disruptions and still provide the same level of availability, resiliency, and redundancy on an open compute platform. >> So when we talk about open, we don't mean generic? Fair? See what I mean? >> Open is more from the software workload perspective, right? A Dell server can run any type of workload that customer intend. >> But it's engineered for this? >> Environment. >> Environment. >> That's correct. >> And so what are some of the environmental issues that are dealt with in the telecom space that are different than the average data center? >> The most basic one, is in most of the traditional cell tower, they are deployed within cabinets instead of racks. So they are depth constraints that you just have no access to the rear of the chassis. So that means on a server, is everything you need to access, need to be in the front, nothing should be in the back. Then you need to consider how labor union come into play, right? There's a lot of constraint on who can go to a cell tower and touch power, who can go there and touch compute, right? So we minimize all that disruption through a modular design and make it very efficient. >> So when we took a look at XR8000, literally right here, sitting on the desk. >> Uh-huh. >> Took it apart, don't panic, just pulled out some sleds and things. >> Right, right. >> One of the interesting demonstrations was how it compared to the size of a shoe. Now apparently you hired someone at Dell specifically because they wear a size 14 shoe, (Charles laughs) so it was even more dramatic. >> That's right. >> But when you see it, and I would suggest that viewers go back and take a look at that segment, specifically on the hardware. You can see exactly what you just referenced. This idea that everything is accessible from the front. Yeah. >> So I want to dig in a couple things. So I want to push back a little bit on what you were saying about the horizontal 'cause there's the benefit, if you've got the horizontal infrastructure, you can run a lot more workloads. But I compare it to the enterprise 'cause I, that was the argument, I've made that argument with converged infrastructure versus say an Oracle vertical stack, but it turned out that actually Oracle ran Oracle better, okay? Is there an analog in telco or is this new open architecture going to be able to not only service the wide range of emerging apps but also be as resilient as the proprietary infrastructure? >> Yeah and you know, before I answer that, I also want to say that we've been writing a number of white papers. So we have actually three white papers we've just done with Dell looking at infrastructure blocks and looking at vertical versus horizontal and also looking at moving from the previous generation hardware to the next generation hardware. So all those details, you can find the white papers, and you can find them either in the Dell website or at the ACG research website >> ACGresearch.com? >> ACG research. Yeah, if you just search ACG research, you'll find- >> Yeah. >> Lots of white papers on TCO. So you know, what I want to say, relative to the vertical versus horizontal. Yeah, obviously in the vertical side, some of those things will run well, I mean it won't have issues. However, that being said, as we move to cloud native, you know, it's very high performance, okay? In terms of the stack, whether it be a Red Hat or a VMware or other cloud layers, that's really become much more mature. It now it's all CNF base, which is really containerized, very high performance. And so I don't think really performance is an issue. However, my feeling is that, if you want to offer new services and generate new revenue, you're not going to do it in vertical stacks, period. You're going to be able to do a packet core, you'll be able to do a ran over here. But now what if I want to offer a gaming service? What if I want to do metaverse? What if I want to do, you have to have an environment that's a multi-vendor environment that supports an ecosystem. Even in the RAN, when we look at the RIC, and the xApps and the rApps, these are multi-vendor environments that's going to create a lot of flexibility and you can't do that if you're restricted to, I can only have one vendor running on this hardware. >> Yeah, we're seeing these vendors work together and create RICs. That's obviously a key point, but what I'm hearing is that there may be trade offs, but the incremental value is going to overwhelm that. Second question I have, Peter is, TCO, I've been hearing a lot about 30%, you know, where's that 30% come from? Is it Op, is it from an OpEx standpoint? Is it labor, is it power? Is it, you mentioned, you know, cutting the number of servers in half. If I can unpack the granularity of that TCO, where's the benefit coming from? >> Yeah, the answer is yes. (Peter and Charles laugh) >> Okay, we'll do. >> Yeah, so- >> One side that, in terms of, where is the big bang for the bucks? >> So I mean, so you really need to look at the white paper to see details, but definitely power, definitely labor, definitely reducing the number of servers, you know, reducing the CapEx. The other thing is, is as you move to this really next generation horizontal telco cloud, there's the whole automation and orchestration, that is a key component as well. And it's enabled by what Dell is doing. It's enabled by the, because the thing is you're not going to have end-to-end automation if you have all this legacy stuff there or if you have these vertical stacks where you can't integrate. I mean you can automate that part and then you have separate automation here, you separate. you need to have integrated automation and orchestration across the whole thing. >> One other point I would add also, right, on the hardware perspective, right? With the customized hardware, what we allow operator to do is, take out the existing appliance and push a edge optimized server without reworking the entire infrastructure. There is a significant saving where you don't have to rethink about what is my power infrastructure, right? What is my security infrastructure? The server is designed to leverage the existing, what is already there. >> How should telco, Charles, plan for this transformation? Are there specific best practices that you would recommend in terms of the operational model? >> Great question. I think first thing is do an inventory of what you have. Understand what your constraints are and then come to Dell, we will love to consult with you, based on our experience on the best practices. We know how to minimize additional changes. We know how to help your support engineer, understand how to shift appliance based operation to a cloud-based operation. >> Is that a service you offer? Is that a pre-sales freebie? What is maybe both? >> It's both. >> Yeah. >> It's both. >> Yeah. >> Guys- >> Just really quickly. >> We're going to wrap. >> The, yeah. Dave loves the TCO discussion. I'm always thinking in terms of, well how do you measure TCO when you're comparing something where you can't do something to an environment where you're going to be able to do something new? And I know that that's always the challenge in any kind of emerging market where things are changing, any? >> Well, I mean we also look at, not only TCO, but we look at overall business case. So there's basically service at GLD and revenue and then there's faster time to revenues. Well, and actually ACG, we actually have a platform called the BAE or Business Analytics Engine that's a very sophisticated simulation cloud-based platform, where we can actually look at revenue month by month. And we look at what's the impact of accelerating revenue by three months. By four months. >> So you're looking into- >> By six months- >> So you're forward looking. You're just not consistently- >> So we're not just looking at TCO, we're looking at the overall business case benefit. >> Yeah, exactly right. There's the TCO, which is the hard dollars. >> Right. >> CFO wants to see that, he or she needs to see that. But you got to, you can convince that individual, that there's a business case around it. >> Peter: Yeah. >> And then you're going to sign up for that number. >> Peter: Yeah. >> And they're going to be held to it. That's the story the world wants. >> At the end of the day, telcos have to be offered new services 'cause look at all the money that's been spent. >> Dave: Yeah, that's right. >> On investment on 5G and everything else. >> 0.5 trillion over the next seven years. All right, guys, we got to go. Sorry to cut you off. >> Okay, thank you very much. >> But we're wall to wall here. All right, thanks so much for coming on. >> Dave: Fantastic. >> All right, Dave Vellante, for Dave Nicholson. Lisa Martin's in the house. John Furrier in Palo Alto Studios. Keep it right there. MWC 23 live from the Fira in Barcelona. (light airy music)

>> Announcer: theCUBE's live coverage is made possible by funding from Dell Technologies. Creating technologies that drive human progress. (upbeat music) >> Hi everybody. Welcome back to Barcelona. We're here at the Fira Live, theCUBE's ongoing coverage of day two of MWC 23. Back in 2021 was my first Mobile World Congress. And you know what? It was actually quite an experience because there was nobody there. I talked to my friend, who's now my co-host, Chris Lewis about what to expect. He said, Dave, I don't think a lot of people are going to be there, but Danielle Royston is here and she's the CEO of Totoge. And that year when Erickson tapped out of its space she took out 60,000 square feet and built out Cloud City. If it weren't for Cloud City, there would've been no Mobile World Congress in June and July of 2021. DR is back. Great to see you. Thanks for coming on. >> It's great to see you. >> Chris. Awesome to see you. >> Yeah, Chris. Yep. >> Good to be back. Yep. >> You guys remember the narrative back then. There was this lady running around this crazy lady that I met at at Google Cloud next saying >> Yeah. Yeah. >> the cloud's going to take over Telco. And everybody's like, well, this lady's nuts. The cloud's been leaning in, you know? >> Yeah. >> So what do you think, I mean, what's changed since since you first caused all those ripples? >> I mean, I have to say that I think that I caused a lot of change in the industry. I was talking to leaders over at AWS yesterday and they were like, we've never seen someone push like you have and change so much in a short period of time. And Telco moves slow. It's known for that. And they're like, you are pushing buttons and you're getting people to change and thank you and keep going. And so it's been great. It's awesome. >> Yeah. I mean, it was interesting, Chris, we heard on the keynotes we had Microsoft, Satya came in, Thomas Curian came in. There was no AWS. And now I asked CMO of GSMA about that. She goes, hey, we got a great relationship with it, AWS. >> Danielle: Yeah. >> But why do you think they weren't here? >> Well, they, I mean, they are here. >> Mean, not here. Why do you think they weren't profiled? >> They weren't on the keynote stage. >> But, you know, at AWS, a lot of the times they want to be the main thing. They want to be the main part of the show. They don't like sharing the limelight. I think they just didn't want be on the stage with the Google CLoud guys and the these other guys, what they're doing they're building out, they're doing so much stuff. As Danielle said, with Telcos change in the ecosystem which is what's happening with cloud. Cloud's making the Telcos think about what the next move is, how they fit in with the way other people do business. Right? So Telcos never used to have to listen to anybody. They only listened to themselves and they dictated the way things were done. They're very successful and made a lot of money but they're now having to open up they're having to leverage the cloud they're having to leverage the services that (indistinct words) and people out provide and they're changing the way they work. >> So, okay in 2021, we talked a lot about the cloud as a potential disruptor, and your whole premise was, look you got to lean into the cloud, or you're screwed. >> Danielle: Yeah. >> But the flip side of that is, if they lean into the cloud too much, they might be screwed. >> Danielle: Yeah. >> So what's that equilibrium? Have they been able to find it? Are you working with just the disruptors or how's that? >> No I think they're finding it right. So my talk at MWC 21 was all about the cloud is a double-edged sword, right? There's two sides to it, and you definitely need to proceed through it with caution, but also I don't know that you have a choice, right? I mean, the multicloud, you know is there another industry that spends more on CapEx than Telco? >> No. >> Right. The hyperscalers are doing it right. They spend, you know, easily approaching over a $100 billion in CapEx that rivals this industry. And so when you have a player like that an industry driving, you know and investing so much Telco, you're always complaining how everyone's riding your coattails. This is the opportunity to write someone else's coattails. So jump on, right? I think you don't have a choice especially if other Telco competitors are using hyperscalers and you don't, they're going to be left behind. >> So you advise these companies all the time, but >> I mean, the issue is they're all they're all using all the hyperscalers, right? So they're the multi, the multiple relationships. And as Danielle said, the multi-layer of relationship they're using the hyperscalers to change their own internal operational environments to become more IT-centric to move to that software centric Telco. And they're also then with the hyperscalers going to market in different ways sometimes with them, sometimes competing with them. What what it means from an analyst point of view is you're suddenly changing the dynamic of a market where we used to have nicely well defined markets previously. Now they're, everyone's in it together, you know, it's great. And, and it's making people change the way they think about services. What I, what I really hope it changes more than anything else is the way the customers at the end of the, at the end of the supply, the value chain think this is what we can get hold of this stuff. Now we can go into the network through the cloud and we can get those APIs. We can draw on the mechanisms we need to to run our personal lives, to run our business lives. And frankly, society as a whole. It's really exciting. >> Then your premise is basically you were saying they should ride on the top over the top of the cloud vendor. >> Yeah. Right? >> No. Okay. But don't they lose the, all the data if they do that? >> I don't know. I mean, I think the hyperscalers are not going to take their data, right? I mean, that would be a really really bad business move if Google Cloud and Azure and and AWS start to take over that, that data. >> But they can't take it. >> They can't. >> From regulate, from sovereignty and regulation. >> They can't because of regulation, but also just like business, right? If they started taking their data and like no enterprises would use them. So I think, I think the data is safe. I think you, obviously every country is different. You got to understand the different rules and regulations for data privacy and, and how you keep it. But I think as we look at the long term, right and we always talk about 10 and 20 years there's going to be a hyperscaler region in every country right? And there will be a way for every Telco to use it. I think their data will be safe. And I think it just, you're going to be able to stand on on the shoulders of someone else for once and use the building blocks of software that these guys provide to make better experiences for subscribers. >> You guys got to explain this to me because when I say data I'm not talking about, you know, personal information. I'm talking about all the telemetry, you know, all the all the, you know the plumbing. >> Danielle: Yeah. >> Data, which is- >> It will increasingly be shared because you need to share it in order to deliver the services in the streamline efficient way that needs to be deliver. >> Did I hear the CEO of Ericsson Wright where basically he said, we're going to charge developers for access to that data through APIs. >> What the Ericsson have done, obviously with the Vage acquisition is they want to get into APIs. So the idea is you're exposing features, quality policy on demand type features for example, or even pulling we still use that a lot of SMS, right? So pulling those out using those APIs. So it will be charged in some way. Whether- >> Man: Like Twitter's charging me for APIs, now I API calls, you >> Know what it is? I think it's Twilio. >> Man: Oh, okay. >> Right. >> Man: No, no, that's sure. >> There's no reason why telcos couldn't provide a Twilio like service itself. >> It's a horizontal play though right? >> Danielle: Correct because developers need to be charged by the API. >> But doesn't there need to be an industry standard to do that as- >> Well. I think that's what they just announced. >> Industry standard. >> Danielle: I think they just announced that. Yeah. Right now I haven't looked at that API set, right? >> There's like eight of them. >> There's eight of them. Twilio has, it's a start you got to start somewhere Dave. (crosstalk) >> And there's all, the TM forum is all the other standard >> Right? Eight is better than zero- >> Right? >> Haven't got plenty. >> I mean for an industry that didn't really understand APIs as a feature, as a product as a service, right? For Mats Granryd, the deputy general of GSMA to stand on the keynote stage and say we partnered and we're unveiling, right. Pay by the use APIs. I was for it. I was like, that is insane. >> I liked his keynote actually, because I thought he was going to talk about how many attendees and how much economic benefiting >> Danielle: We're super diverse. >> He said, I would usually talk about that and you know greening in the network by what you did talk about a little bit. But, but that's, that surprised me. >> Yeah. >> But I've seen in the enterprise this is not my space as, you know, you guys don't live this but I've seen Oracle try to get developers. IBM had to pay $35 billion trying to get for Red Hat to get developers, right? EMC used to have a thing called EMC code, failed. >> I mean they got to do something, right? So 4G they didn't really make the business case the ROI on the investment in the network. Here we are with 5G, same discussion is having where's the use case? How are we going to monetize and make the ROI on this massive investment? And now they're starting to talk about 6G. Same fricking problem is going to happen again. And so I think they need to start experimenting with new ideas. I don't know if it's going to work. I don't know if this new a API network gateway theme that Mats talked about yesterday will work. But they need to start unbundling that unlimited plan. They need to start charging people who are using the network more, more money. Those who are using it less, less. They need to figure this out. This is a crisis for them. >> Yeah our own CEO, I mean she basically said, Hey, I'm for net neutrality, but I want to be able to charge the people that are using it more and more >> To make a return on, on a capital. >> I mean it costs billions of dollars to build these networks, right? And they're valuable. We use them and we talked about this in Cloud City 21, right? The ability to start building better metaverses. And I know that's a buzzword and everyone hates it, but it's true. Like we're working from home. We need- there's got to be a better experience in Zoom in 2D, right? And you need a great network for that metaverse to be awesome. >> You do. But Danielle, you don't need cellular for doing that, do you? So the fixed network is as important. >> Sure. >> And we're at mobile worlds. But actually what we beginning to hear and Crystal Bren did say this exactly, it's about the comp the access is sort of irrelevant. Fixed is better because it's more the cost the return on investment is better from fiber. Mobile we're going to change every so many years because we're a new generation. But we need to get the mechanism in place to deliver that. I actually don't agree that we should everyone should pay differently for what they use. It's a universal service. We need it as individuals. We need to make it sustainable for every user. Let's just not go for the biggest user. It's not, it's not the way to build it. It won't work if you do that you'll crash the system if you do that. And, and the other thing which I disagree on it's not about standing on the shoulders and benefiting from what- It's about cooperating across all levels. The hyperscalers want to work with the telcos as much as the telcos want to work with the hyperscalers. There's a lot of synergy there. There's a lot of ways they can work together. It's not one or the other. >> But I think you're saying let the cloud guys do the heavy lifting and I'm - >> Yeah. >> Not at all. >> And so you don't think so because I feel like the telcos are really good at pipes. They've always been good at pipes. They're engineers. >> Danielle: Yeah. >> Are they hanging on to the to the connectivity or should they let that go and well and go toward the developer. >> I mean AWS had two announcements on the 21st a week before MWC. And one was that telco network builder. This is literally being able to deploy a network capability at AWS with keystrokes. >> As a managed service. >> Danielle: Correct. >> Yeah. >> And so I don't know how the telco world I felt the shock waves, right? I was like, whoa, that seems really big. Because they're taking something that previously was like bread and butter. This is what differentiates each telco and now they've standardized it and made it super easy so anyone can do it. Now do I think the five nines of super crazy hardcore network criteria will be built on AWS this way? Probably not, but no >> It's not, it's not end twin. So you can't, no. >> Right. But private networks could be built with this pretty easily, right? And so telcos that don't have as much funding, right. Smaller, more experiments. I think it's going to change the way we think about building networks in telcos >> And those smaller telcos I think are going to be more developer friendly. >> Danielle: Yeah. >> They're going to have business models that invite those developers in. And that's, it's the disruption's going to come from the ISVs and the workloads that are on top of that. >> Well certainly what Dish is trying to do, right? Dish is trying to build a- they launched it reinvent a developer experience. >> Dave: Yeah. >> Right. Built around their network and you know, again I don't know, they were not part of this group that designed these eight APIs but I'm sure they're looking with great intent on what does this mean for them. They'll probably adopt them because they want people to consume the network as APIs. That's their whole thing that Mark Roanne is trying to do. >> Okay, and then they're doing open ran. But is it- they're not really cons- They're not as concerned as Rakuten with the reliability and is that the right play? >> In this discussion? Open RAN is not an issue. It really is irrelevant. It's relevant for the longer term future of the industry by dis aggregating and being able to share, especially ran sharing, for example, in the short term in rural environments. But we'll see some of that happening and it will change, but it will also influence the way the other, the existing ran providers build their services and offer their value. Look you got to remember in the relationship between the equipment providers and the telcos are very dramatically. Whether it's Ericson, NOKIA, Samsung, Huawei, whoever. So those relations really, and the managed services element to that depends on what skills people have in-house within the telco and what service they're trying to deliver. So there's never one size fits all in this industry. >> You're very balanced in your analysis and I appreciate that. >> I try to be. >> But I am not. (chuckles) >> So when Dr went off, this is my question. When Dr went off a couple years ago on the cloud's going to take over the world, you were skeptical. You gave a approach. Have you? >> I still am. >> Have you moderated your thoughts on that or- >> I believe the telecom industry is is a very strong industry. It's my industry of course I love it. But the relationship it is developing much different relationships with the ecosystem players around it. You mentioned developers, you mentioned the cloud players the equipment guys are changing there's so many moving parts to build the telco of the future that every country needs a very strong telco environment to be able to support the site as a whole. People individuals so- >> Well I think two years ago we were talking about should they or shouldn't they, and now it's an inevitability. >> I don't think we were Danielle. >> All using the hyperscalers. >> We were always going to need to transform the telcos from the conservative environments in which they developed. And they've had control of everything in order to reduce if they get no extra revenue at all, reducing the cost they've got to go on a cloud migration path to do that. >> Amenable. >> Has it been harder than you thought? >> It's been easier than I thought. >> You think it's gone faster than >> It's gone way faster than I thought. I mean pushing on this flywheel I thought for sure it would take five to 10 years it is moving. I mean the maths comp thing the AWS announcements last week they're putting in hyperscalers in Saudi Arabia which is probably one of the most sort of data private places in the world. It's happening really fast. >> What Azure's doing? >> I feel like I can't even go to sleep. Because I got to keep up with it. It's crazy. >> Guys. >> This is awesome. >> So awesome having you back on. >> Yeah. >> Chris, thanks for co-hosting. Appreciate you stay here. >> Yep. >> Danielle, amazing. We'll see you. >> See you soon. >> A lot of action here. We're going to come out >> Great. >> Check out your venue. >> Yeah the Togi buses that are outside. >> The big buses. You got a great setup there. We're going to see you on Wednesday. Thanks again. >> Awesome. Thanks. >> All right. Keep it right there. We'll be back to wrap up day two from MWC 23 on theCUBE. (upbeat music)

>> Narrator: theCUBE's live coverage is made possible by funding from Dell Technologies, creating technologies that drive human progress. (upbeat music) >> Welcome back to the Fira in Barcelona. This is Dave Vellante with David Nicholson. Lisa Martin is also here. This is day two of our coverage of MWC 23 on theCUBE. We're super excited. We're in between hall four and five. Stop by if you're here. Dennis Hoffman is here. He's the senior vice president and general manager of the Telecom systems business at Dell Technologies, and he's joined by Yousef Khalidi, who's the corporate vice president of Azure for Operators from Microsoft. Gents, Welcome. >> Thanks, Dave. >> Thank you. >> So we saw Satya in the keynote. He wired in. We saw T.K. came in. No AWS. I don't know. They're maybe not part of the show, but maybe next year they'll figure it out. >> Indeed, indeed. >> Lots of stuff happened in the Telecom, but the Azure operator distributed service is the big news, you guys got here. What's that all about? >> Oh, first of all, we changed the name. >> Oh, you did? >> You did? >> Oh, yeah. We have a real name now. It's called the Azure Operator Nexus. >> Oh, I like Nexus better than that. >> David: That's much better, much better. >> Dave: The engineers named it first time around. >> I wish, long story, but thank you for our marketing team. But seriously, not only did we rename the platform, we expanded the platform. >> Dave: Yeah. >> So it now covers the whole spectrum from the far-edge to the public cloud as well, including the near-edge as well. So essentially, it's a hybrid platform that can also run network functions. So all these operators around you, they now have a platform which combines cloud technologies with the choice where they want to run, optimized for the network. >> Okay and so, you know, we've talked about the disaggregation of the network and how you're bringing kind of engineered systems to the table. We've seen this movie before, but Dennis, there are differences, right? I mean, you didn't really have engineered systems in the 90s. You didn't have those integration points. You really didn't have the public cloud, you didn't have AI. >> Right. >> So you have all those new powers that you can tap, so give us the update from your perspective, having now spent a day and a half here. What's the vibe, what's the buzz, and what's your take on everything? >> Yeah, I think to build on what Yousef said, there's a lot going on with people still trying to figure out exactly how to architect the Telecom network of the future. They know it's got to have a lot to do with cloud. It does have some pretty significant differences, one of those being, there's definitely got to be a hybrid component because there are pieces of the Telecom network that even when modernized will not end up centralized, right? They're going to be highly distributed. I would say though, you know, we took away two things, yesterday, from all the meetings. One, people are done, I think the network operators are done, questioning technology readiness. They're now beginning to wrestle with operationalization of it all, right? So it's like, okay, it's here. I can in fact build a modern network in a very cloud native way, but I've got to figure out how to do that all. And another big part of it is the ecosystem and certainly the partnership long standing between Dell and Microsoft which we're extending into this space is part of that, making it easier on people to actually acquire, deploy, and importantly, support these new technologies. >> So a lot of the traditional carriers, like you said, they're sort of beyond the technology readiness. Jose Maria Alvarez in the keynote said there are three pillars to the future Telecom network. He said low latency, programmable networks, and then cloud and edge, kind of threw that in. You agree with that, Yousef? (Dave and Yousef speaking altogether) >> I mean, we've been for years talking about the cloud and edge. >> Yeah. >> Satya for years had the same graphic. We still have it. Today, we have expanded the graphic a bit to include the network as one, because you can have a cloud without connectivity as well but this is very, very, very, very much true. >> And so the question then, Dennis, is okay, you've got disruptors, we had Dish on yesterday. >> Oh, did you? Good. >> Yeah, yeah, and they're talking about what they're doing with, you know, ORAN and all the applications, really taking account of it. What I see is a developer friendly, you know, environment. You got the carriers talking about how they're going to charge developers for APIs. I think they've published eight APIs which is nowhere near enough. So you've got that sort of, you know, inertia and yet, you have the disruptors that are going to potentially be a catalyst to, you know, cross the chasm, if you will. So, you know, put on your strategy hat. >> Yeah. >> Dave: How do you see that playing out? >> Well, they're trying to tap into three things, the disruptors. You know, I think the thesis is, "If I get to a truly cloud native, communications network first, I ought to have greater agility so that I can launch more services and create more revenue streams. I ought to be lower cost in terms of both acquisition cost and operating cost, right, and I ought to be able to create scale between my IT organization, everything I know how to do there and my Telecom network." You know, classic, right? Better, faster, cheaper if I embrace cloud early on. And people like Dish, you know, they have a clean sheet of paper with which to do that. So innovation and rate of innovation is huge for them. >> So what would you do? We put your Clay Christensen hat on, now. What if you were at a traditional Telco who's like, complaining about- >> You're going to get me in trouble. >> Dave: Come on, come on. >> Don't do it. >> Dave: Help him out. Help him out, help him out. So if, you know, they're complaining about CapEx, they're highly regulated, right, they want net neutrality but they want to be able to sort of dial up the cost of those using the network. So what would you do? Would you try to disrupt yourself? Would you create a skunkworks? Would you kind of spin off a disruptor? That's a real dilemma for those guys. >> Well for mobile network operators, the beauty of 5G is it's the first cloud native cellular standard. So I don't know if anybody's throwing these terms around, but 5G SA is standalone, right? >> Dave: Yeah, yeah. >> So a lot of 'em, it's not a skunkworks. They're just literally saying, "I've got to have a 5G network." And some of 'em are deciding, "I'm going to stand it up all by itself." Now, that's duplicative expense in a lot of ways, but it creates isolation from the two networks. Others are saying, "No, it's got to be NSA. I've got to be able to combine 4G and 5G." And then you're into the brownfield thing. >> That's the hybrid. >> Not hybrid as in cloud, but hybrid as in, you know. >> Yeah, yeah. >> It's a converge network. >> Dave: Yeah, yeah. >> So, you know, I would say for a lot of them, they're adopting, probably rightly so, a wait and see attitude. One thing we haven't talked about and you got to get on the table, their high order bit is resilience. >> Dave: Yeah, totally. >> David: Yeah. >> Right? Can't go down. It's national, secure infrastructure, first responder. >> Indeed. >> Anytime you ask them to embrace any new technology, the first thing that they have to work through in their minds is, you know, "Is the juice worth the squeeze? Like, can I handle the risk?" >> But you're saying they're not questioning the technology. Aren't they questioning ORAN in terms of the quality of service, or are they beyond that? >> Dennis: They're questioning the timing, not the inevitability. >> Okay, so they agree that ORAN is going to be open over time. >> At some point, RAN will be cloud native, whether it's ORAN the spec, open RAN the concept, (Yousef speaking indistinctly) >> Yeah. >> Virtual RAN. But yeah, I mean I think it seems pretty evident at this point that the mainframe will give way to open systems once again. >> Dave: Yeah, yeah, yeah. >> ERAN, ecosystem RAN. >> Any RAN. (Dave laughing) >> You don't have to start with the ORAN where they're inside the house. So as you probably know, our partner AT&T started with the core. >> Dennis: They almost all have. >> And they've been on the virtualization path since 2014 and 15. And what we are working with them on is the hybrid cloud model to expand all the way, if you will, as I mentioned to the far-edge or the public cloud. So there's a way to be in the brownfield environment, yet jump on the new bandwagon of technology without necessarily taking too much risk, because you're quite right. I mean, resiliency, security, service assurance, I mean, for example, AT&T runs the first responder network for the US on their network, on our platform, and I'm personally very familiar of how high the bar is. So it's doable, but you need to go in stages, of course. >> And they've got to do that integration. >> Yes. >> They do. >> And Yousef made a great point. Like, out of the top 30 largest Telcos by CapEx outside of China, three quarters of them have virtualized their core. So the cloudification, if you will, software definition run on industry standard hardware, embraced cloud native principles, containerized apps, that's happened in the core. It's well accepted. Now it's just a ripple-down through the network which will happen as and when things are faster, better, cheaper. >> Right. >> So as implemented, what does this look like? Is it essentially what we used to loosely refer to as Azure stacked software, running with Dell optimized Telecom infrastructure together, sometimes within a BBU, out in a hybrid cloud model communicating back to Azure locations in some cases? Is that what we're looking at? >> Approximately. So you start with the near-edge, okay? So the near-edge lives in the operator's data centers, edges, whatever the case may be, built out of off the shelf hardware. Dell is our great partner there but in principle, it could be different mix and match. So once you have that true near-edge, then you can think of, "Okay, how can I make sure this environment is as uniform, same APIs, same everything, regardless what the physical location is?" And this is key, key for the network function providers and the NEPs because they need to be able to port once, run everywhere, and it's key for the operator to reduce their costs. You want to teach your workforce, your operations folks, if you will, how to manage this system one time, to automation and so forth. So, and that is actually an expansion of the Azure capabilities that people are familiar with in a public cloud, projected into different locations. And we have technology called Arc which basically models everything. >> Yeah, yeah. >> So if you have trained your IT side, you are halfway there, how to manage your new network. Even though of course the network is carrier graded, there's different gear. So yes, what you said, a lot of it is true but the actual components, whatever they might be running, are carrier grade, highly optimized, the next images and our solution is not a DIY solution, okay? I know you cater to a wide spectrum here but for us, we don't believe in the TCO. The proper TCO can be achieved by just putting stuff by yourself. We just published a report with Analysys Mason that shows that our approach will save 36 percent of the cost compared to a DIY approach. >> Dave: What percent? >> 36 percent. >> Dave: Of the cost? >> Of, compared to DIY, which is already cheaper than classical models. >> And there's a long history of fairly failed DIY, right, >> Yeah. >> That preceded this. As in the early days of public cloud, the network operators wrestled with, "Do I have to become one to survive?" >> Dave: Yeah. Right. >> So they all ended up having cloud projects and by and large, they've all dematerialized in favor of this. >> Yeah, and it's hard for them to really invest at scale. Let me give you an example. So, your biggest tier one operator, without naming anybody, okay, how many developers do they have that can build and maintain an OS image, or can keep track of container technology, or build monitoring at scale? In our company, we have literally thousands of developers doing it already for the cloud and all we're doing for the operator segment is customizing it and focusing it at the carrier grade aspects of it. But so, I don't have half a dozen exterior experts. I literally have a building of developers who can do that and I'm being literal, here. So it's a scale thing. Once you have a product that you can give to multiple people, everybody benefits. >> Dave: Yeah, and the carriers are largely, they're equipment engineers in a large setting. >> Oh, they have a tough job. I always have total respect what they do. >> Oh totally, and a lot of the work happens, you know, kind of underground and here they are. >> They are network operators. >> They don't touch. >> It's their business. >> Right, absolutely, and they're good at it. They're really good at it. That's right. You know, you think about it, we love to, you know, poke fun at the big carriers, but think about what happened during the pandemic. When they had us shift everything to remote work, >> Dennis: Yes. >> Landline traffic went through the roof. You didn't even notice. >> Yep. That's very true. >> I mean, that's the example. >> That's very true. >> However, in the future where there's innovation and it's going to be driven by developers, right, that's where the open ecosystem comes in. >> Yousef: Indeed. >> And that's the hard transition for a lot of these folks because the developers are going to win that with new workloads, new applications that we can't even think of. >> Dennis: Right. And a lot of it is because if you look at it, there's the fundamental back strategy hat back on, fundamental dynamics of the industry, forced investment, flat revenues. >> Dave: Yeah. Right. >> Very true. >> Right? Every few years, a new G comes out. "Man, I got to retool this massive thing and where I can't do towers, I'm dropping fiber or vice a versa." And meanwhile, most diversification efforts into media have failed. They've had to unwind them and resell them. There's a lot of debt in the industry. >> Yousef: Yeah. >> Dennis: And so, they're looking for that next big, adjacent revenue stream and increasingly deciding, "If I don't modernize my network, I can't get it." >> Can't do it. >> Right, and again, what I heard from some of the carriers in the keynote was, "We're going to charge for API access 'cause we have data in the network." Okay, but I feel like there's a lot more innovation beyond that that's going to come from the disruptors. >> Dennis: Oh yeah. >> Yousef: Yes. >> You know, that's going to blow that away, right? And then that may not be the right model. We'll see, you know? I mean, what would Microsoft do? They would say, "Here, here's a platform. Go develop." >> No, I'll tell you. We are actually working with CAMARA and GSMA on the whole API layer. We actually announced a service as well as (indistinct). >> Dave: Yeah, yeah, right. >> And the key there, frankly, in my opinion, are not the disruptors as in operators. It's the ISV community. You want to get developers that can write to a global set of APIs, not per Telco APIs, such that they can do the innovation. I mean, this is what we've seen in other industries, >> Absolutely. >> That I critically can think of. >> This is the way they get a slice of that pie, right? The recent history of this industry is one where 4G LTE begot the smartphone and app store era, a bevy of consumer services, and almost every single profit stream went somewhere other than the operator, right? >> Yousef: Someone else. So they're looking at this saying, "Okay, 5G is the enterprise G and there's going to be a bevy of applications that are business service related, based on 5G capability and I can't let the OTT, over the top, thing happen again." >> Right. >> They'll say that. "We cannot let this happen." >> "We can't let this happen again." >> Okay, but how do they, >> Yeah, how do they make that not happen? >> Not let it happen again? >> Eight APIs, Dave. The answer is eight APIs. No, I mean, it's this approach. They need to make it easy to work with people like Yousef and more importantly, the developer community that people like Yousef and his company have found a way to harness. And by the way, they need to be part of that developer community themselves. >> And they're not, today. They're not speaking that developer language. >> Right. >> It's hard. You know, hey. >> Dennis: Hey, what's the fastest way to sell an enterprise, a business service? Resell Azure, Teams, something, right? But that's a resale. >> Yeah, that's a resale thing. >> See, >> That's not their service. >> They also need to free their resources from all the plumbing they do and leave it to us. We are plumbers, okay? >> Dennis: We are proud plumbers. >> We are proud plumbers. I'm a plumber. I keep telling people this thing. We had the same discussion with banks and enterprises 10 years ago, by the way. Don't do the plumbing. Go add value on the top. Retool your workforce to do applications and work with ISVs to the verticals, as opposed to either reselling, which many do, or do the plumbing. You'd be surprised. Traditionally, many operators do around, "I want to plumb this thing to get this small interrupt per second." Like, who cares? >> Well, 'cause they made money on connectivity. >> Yes. >> And we've seen this before. >> And in a world without telephone poles and your cables- >> Hey, if what you have is a hammer, everything's a nail, right? And we sell connectivity services and that's what we know how to do, and that both build and sell. And if that's no longer driving a revenue stream sufficient to cover this forced investment march, not to mention Huawei rip and government initiatives to pull infrastructure out and accelerate investment, they got to find new ways. >> I mean, the regulations have been tough, right? They don't go forward and ask for permission. They really can't, right? They have to be much more careful. >> Dennis: It is tough. >> So, we don't mean to sound like it's easy for these guys. >> Dennis: No, it's not. >> But it does require a new mindset, new skillsets, and I think some of 'em are going to figure it out and then pff, the wave, and you guys are going to be riding that wave. >> We're going to try. >> Definitely. Definitely. >> As a veteran of working with both Dell and Microsoft, specifically Azure on things, I am struck by how you're very well positioned in this with Microsoft in particular. Because of Azure's history, coming out of the on-premises world that Microsoft knows so well, there's a natural affinity to the hybrid nature of Telecom. We talk about edge, we talk about hybrid, this is it, absolutely the center of it. So it seems like a- >> Yousef: Indeed. Actually, if you look at the history of Azure, from day one, and I was there from day one, we always spoke of the hybrid model. >> Yeah. >> The third point, we came from the on-premises world. >> David: Right. >> And don't get me wrong, I want people to use the public cloud, but I also know due to physics, regulation, geopolitical boundaries, there's something called on-prem, something called an edge here. I want to add something else. Remember our deal on how we are partner-centric? We're applying the same playbook, here. So, you know, for every dollar we make, so many of it's been done by the ecosystem. Same applies here. So we have announced partnerships with Ericson, Nokia, (indistinct), all the names, and of course with Dell and many others. The ecosystem has to come together and customers must retain their optionality to drum up whatever they are on. So it's the same playbook, with this. >> And enterprise technology companies are, actually, really good at, you know, decoding the customer, figuring out specific requirements, making some mistakes the first time through and then eventually getting it right. And as these trends unfold, you know, you're in a good position, I think, as are others and it's an exciting time for enterprise tech in this industry, you know? >> It really is. >> Indeed. >> Dave: Guys, thanks so much for coming on. >> Thank you. >> Dave: It's great to see you. Have a great rest of the show. >> Thank you. >> Thanks, Dave. Thank you, Dave. >> All right, keep it right there. John Furrier is live in our studio. He's breaking down all the news. Go to siliconangle.com to go to theCUBE.net. Dave Vellante, David Nicholson and Lisa Martin, we'll be right back from the theater in Barcelona, MWC 23 right after this short break. (relaxing 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. >> The world's leading telcos are trying to shed the stigma of being monopolies lacking innovation. Telcos have been great at operational efficiency and connectivity and living off of transmission, and the costs and expenses or revenue associated with that transmission. But in a world beyond telephone poles and basic wireless and mobile services, how will telcos modernize and become more agile and monetize new opportunities brought about by 5G and private wireless and a spate of new innovations and infrastructure, cloud data and apps? Hello, and welcome to this week's Wikibon CUBE Insights powered by ETR. In this breaking analysis and ahead of Mobile World Congress or now, MWC23, we explore the evolution of the telco business and how the industry is in many ways, mimicking transformations that took place decades ago in enterprise IT. We'll model some of the traditional enterprise vendors using ETR data and investigate how they're faring in the telecommunications sector, and we'll pose some of the key issues facing the industry this decade. First, let's take a look at what the GSMA has in store for MWC23. GSMA is the host of what used to be called Mobile World Congress. They've set the theme for this year's event as "Velocity" and they've rebranded MWC to reflect the fact that mobile technology is only one part of the story. MWC has become one of the world's premier events highlighting innovations not only in Telco, mobile and 5G, but the collision between cloud, infrastructure, apps, private networks, smart industries, machine intelligence, and AI, and more. MWC comprises an enormous ecosystem of service providers, technology companies, and firms from virtually every industry including sports and entertainment. And as well, GSMA, along with its venue partner at the Fira Barcelona, have placed a major emphasis on sustainability and public and private partnerships. Virtually every industry will be represented at the event because every industry is impacted by the trends and opportunities in this space. GSMA has said it expects 80,000 attendees at MWC this year, not quite back to 2019 levels, but trending in that direction. Of course, attendance from Chinese participants has historically been very high at the show, and obviously the continued travel issues from that region are affecting the overall attendance, but still very strong. And despite these concerns, Huawei, the giant Chinese technology company. has the largest physical presence of any exhibitor at the show. And finally, GSMA estimates that more than $300 million in economic benefit will result from the event which takes place at the end of February and early March. And The Cube will be back at MWC this year with a major presence thanks to our anchor sponsor, Dell Technologies and other supporters of our content program, including Enterprise Web, ArcaOS, VMware, Snowflake, Cisco, AWS, and others. And one of the areas we're interested in exploring is the evolution of the telco stack. It's a topic that's often talked about and one that we've observed taking place in the 1990s when the vertically integrated IBM mainframe monopoly gave way to a disintegrated and horizontal industry structure. And in many ways, the same thing is happening today in telecommunications, which is shown on the left-hand side of this diagram. Historically, telcos have relied on a hardened, integrated, and incredibly reliable, and secure set of hardware and software services that have been fully vetted and tested, and certified, and relied upon for decades. And at the top of that stack on the left are the crown jewels of the telco stack, the operational support systems and the business support systems. For the OSS, we're talking about things like network management, network operations, service delivery, quality of service, fulfillment assurance, and things like that. For the BSS systems, these refer to customer-facing elements of the stack, like revenue, order management, what products they sell, billing, and customer service. And what we're seeing is telcos have been really good at operational efficiency and making money off of transport and connectivity, but they've lacked the innovation in services and applications. They own the pipes and that works well, but others, be the over-the-top content companies, or private network providers and increasingly, cloud providers have been able to bypass the telcos, reach around them, if you will, and drive innovation. And so, the right-most diagram speaks to the need to disaggregate pieces of the stack. And while the similarities to the 1990s in enterprise IT are greater than the differences, there are things that are different. For example, the granularity of hardware infrastructure will not likely be as high where competition occurred back in the 90s at every layer of the value chain with very little infrastructure integration. That of course changed in the 2010s with converged infrastructure and hyper-converged and also software defined. So, that's one difference. And the advent of cloud, containers, microservices, and AI, none of that was really a major factor in the disintegration of legacy IT. And that probably means that disruptors can move even faster than did the likes of Intel and Microsoft, Oracle, Cisco, and the Seagates of the 1990s. As well, while many of the products and services will come from traditional enterprise IT names like Dell, HPE, Cisco, Red Hat, VMware, AWS, Microsoft, Google, et cetera, many of the names are going to be different and come from traditional network equipment providers. These are names like Ericsson and Huawei, and Nokia, and other names, like Wind River, and Rakuten, and Dish Networks. And there are enormous opportunities in data to help telecom companies and their competitors go beyond telemetry data into more advanced analytics and data monetization. There's also going to be an entirely new set of apps based on the workloads and use cases ranging from hospitals, sports arenas, race tracks, shipping ports, you name it. Virtually every vertical will participate in this transformation as the industry evolves its focus toward innovation, agility, and open ecosystems. Now remember, this is not a binary state. There are going to be greenfield companies disrupting the apple cart, but the incumbent telcos are going to have to continue to ensure newer systems work with their legacy infrastructure, in their OSS and BSS existing systems. And as we know, this is not going to be an overnight task. Integration is a difficult thing, transformations, migrations. So that's what makes this all so interesting because others can come in with Greenfield and potentially disrupt. There'll be interesting partnerships and ecosystems will form and coalitions will also form. Now, we mentioned that several traditional enterprise companies are or will be playing in this space. Now, ETR doesn't have a ton of data on specific telecom equipment and software providers, but it does have some interesting data that we cut for this breaking analysis. What we're showing here in this graphic is some of the names that we've followed over the years and how they're faring. Specifically, we did the cut within the telco sector. So the Y-axis here shows net score or spending velocity. And the horizontal axis, that shows the presence or pervasiveness in the data set. And that table insert in the upper left, that informs as to how the dots are plotted. You know, the two columns there, net score and the ends. And that red-dotted line, that horizontal line at 40%, that is an indicator of a highly elevated level. Anything above that, we consider quite outstanding. And what we'll do now is we'll comment on some of the cohorts and share with you how they're doing in telecommunications, and that sector, that vertical relative to their position overall in the data set. Let's start with the public cloud players. They're prominent in every industry. Telcos, telecommunications is no exception and it's quite an interesting cohort here. On the one hand, they can help telecommunication firms modernize and become more agile by eliminating the heavy lifting and you know, all the cloud, you know, value prop, data center costs, and the cloud benefits. At the same time, public cloud players are bringing their services to the edge, building out their own global networks and are a disruptive force to traditional telcos. All right, let's talk about Azure first. Their net score is basically identical to telco relative to its overall average. AWS's net score is higher in telco by just a few percentage points. Google Cloud platform is eight percentage points higher in telco with a 53% net score. So all three hyperscalers have an equal or stronger presence in telco than their average overall. Okay, let's look at the traditional enterprise hardware and software infrastructure cohort. Dell, Cisco, HPE, Red Hat, VMware, and Oracle. We've highlighted in this chart just as sort of indicators or proxies. Dell's net score's 10 percentage points higher in telco than its overall average. Interesting. Cisco's is a bit higher. HPE's is actually lower by about nine percentage points in the ETR survey, and VMware's is lower by about four percentage points. Now, Red Hat is really interesting. OpenStack, as we've previously reported is popular with telcos who want to build out their own private cloud. And the data shows that Red Hat OpenStack's net score is 15 percentage points higher in the telco sector than its overall average. OpenShift, on the other hand, has a net score that's four percentage points lower in telco than its overall average. So this to us talks to the pace of adoption of microservices and containers. You know, it's going to happen, but it's going to happen more slowly. Finally, Oracle's spending momentum is somewhat lower in the sector than its average, despite the firm having a decent telco business. IBM and Accenture, heavy services companies are both lower in this sector than their average. And real quickly, snowflake's net score is much lower by about 12 percentage points relative to its very high average net score of 62%. But we look for them to be a player in this space as telcos need to modernize their analytics stack and share data in a governed manner. Databricks' net score is also much lower than its average by about 13 points. And same, I would expect them to be a player as open architectures and cloud gains steam in telco. All right, let's close out now on what we're going to be talking about at MWC23 and some of the key issues that we'll be unpacking. We've talked about stack disaggregation in this breaking analysis, but the key here will be the pace at which it will reach the operational efficiency and reliability of closed stacks. Telcos, you know, in a large part, they're engineering heavy firms and much of their work takes place, kind of in the basement, in the dark. It's not really a big public hype machine, and they tend to move slowly and cautiously. While they understand the importance of agility, they're going to be careful because, you know, it's in their DNA. And so at the same time, if they don't move fast enough, they're going to get hurt and disrupted by competitors. So that's going to be a topic of conversation, and we'll be looking for proof points. And the other comment I'll make is around integration. Telcos because of their conservatism will benefit from better testing and those firms that can innovate on the testing front and have labs and certifications and innovate at that level, with an ecosystem are going to be in a better position. Because open sometimes means wild west. So the more players like Dell, HPE, Cisco, Red Hat, et cetera, that do that and align with their ecosystems and provide those resources, the faster adoption is going to go. So we'll be looking for, you know, who's actually doing that, Open RAN or Radio Access Networks. That fits in this discussion because O-RAN is an emerging network architecture. It essentially enables the use of open technologies from an ecosystem and over time, look at O-RAN is going to be open, but the questions, you know, a lot of questions remain as to when it will be able to deliver the operational efficiency of traditional RAN. Got some interesting dynamics going on. Rakuten is a company that's working hard on this problem, really focusing on operational efficiency. Then you got Dish Networks. They're also embracing O-RAN. They're coming at it more from service innovation. So that's something that we'll be monitoring and unpacking. We're going to look at cloud as a disruptor. On the one hand, cloud can help drive agility, as we said earlier and optionality, and innovation for incumbent telcos. But the flip side is going to also do the same for startups trying to disrupt and cloud attracts startups. While some of the telcos are actually embracing the cloud, many are being cautious. So that's going to be an interesting topic of discussion. And there's private wireless networks and 5G, and hyperlocal private networks, they're being deployed, you know, at the edge. This idea of open edge is also a really hot topic and this trend is going to accelerate. You know, the importance here is that the use cases are going to be widely varied. The needs of a hospital are going to be different than those of a sports venue are different from a remote drilling location, and energy or a concert venue. Things like real-time AI inference and data flows are going to bring new services and monetization opportunities. And many firms are going to be bypassing traditional telecommunications networks to build these out. Satellites as well, we're going to see, you know, in this decade, you're going to have, you're going to look down at Google Earth and you're going to see real-time. You know, today you see snapshots and so, lots of innovations going in that space. So how is this going to disrupt industries and traditional industry structures? Now, as always, we'll be looking at data angles, right? 'Cause it's in The Cube's DNA to follow the data and what opportunities and risks data brings. The Cube is going to be on location at MWC23 at the end of the month. We got a great set. We're in the walkway between halls four and five, right in Congress Square, it's booths CS60. So we'll have a full, they're called Stan CS60. We have a full schedule. I'm going to be there with Lisa Martin, Dave Nicholson and the entire Cube crew, so don't forget to stop by. All right, that's a wrap. I want to thank Alex Myerson, who's on production and manages the podcast, Ken Schiffman as well. Kristin Martin and Cheryl Knight help get the word out on social media and in our newsletters. And Rob Hof is our editor-in-chief over at Silicon Angle, does some great stuff for us. Thank you all. Remember, all these episodes are available as podcasts. Wherever you listen, just search "Breaking Analysis" podcasts I publish each week on wikibon.com and silicon angle.com. And all the video content is available on demand at thecube.net. You can email me directly at david.vellante@silicon angle.com. You can DM me at dvellante or comment on my LinkedIn post. Please do check out etr.ai for the best survey data in the enterprise tech business. This is Dave Vellante for The Cube Insights powered by ETR. Thanks for watching and we'll see you at Mobile World Congress, and/or at next time on "Breaking Analysis." (bright music) (bright music fades)

>>Good afternoon, brilliant humans, and welcome back to the Cube. We're live in Detroit, Michigan at Cub Con, and I'm joined by John Furrier. John three exciting days buzzing. How you doing? >>That's great. I mean, we're coming down to the third day. We're keeping the energy going, but this segment's gonna be awesome. The CD foundation's doing amazing work. Developers are gonna be running businesses and workflows are changing. Productivity's the top conversation, and you're gonna start to see a coalescing of the communities who are continuous delivery, and it's gonna be awesome. >>And, and our next guess is an outstanding person to talk about this. We are joined by Stephen Chin, the chair of the CD Foundation. Steven, thanks so much for being here. >>No, no, my pleasure. I mean, this has been an amazing week quote that CubeCon with all of the announcements, all of the people who came out here to Detroit and, you know, fantastic. Like just walking around, you bump into all the right people here. Plus we held a CD summit zero day events, and had a lot of really exciting announcements this week. >>Gotta love the shirt. I gotta say, it's one of my favorites. Love the logos. Love the love the branding. That project got traction. What's the news in the CD foundation? I tried to sneak in the back. I got a little laid into your co-located event. It was packed. Everyone's engaged. It was really looked, look really cool. Give us the update. >>What's the news? Yeah, I know. So we, we had a really, really powerful event. All the key practitioners, the open source leads and folks were there. And one of, one of the things which I think we've done a really good job in the past six months with the CD foundation is getting back to the roots and focusing on technical innovation, right? This is what drives foundations, having strong projects, having people who are building innovation, and also bringing in a new innovation. So one of the projects which we added to the CD foundation this week is called Persia. So it's a, it's a decentralized package repository for getting open source libraries. And it solves a lot of the problems which you get when you have centralized infrastructure. You don't have the right security certificates, you don't have the right verification libraries. And these, these are all things which large companies provision and build out inside of their infrastructure. But the open source communities don't have the benefit of the same sort of really, really strong architecture. A lot of, a lot of the systems we depend upon. It's >>A good point, yeah. >>Yeah. I mean, if you think about the systems that developers depend upon, we depend upon, you know, npm, ruby Gems, Mayn Central, and these systems been around for a while. Like they serve the community well, right? They're, they're well supported by the companies and it's, it's, it's really a great contribution that they give us. But every time there's an outage or there's a security issue, guess, guess how many security issues that our, our research team found at npm? Just ballpark. >>74. >>So there're >>It's gotta be thousands. I mean, it's gotta be a lot of tons >>Of Yeah, >>They, they're currently up to 60,000 >>Whoa. >>Vulnerable, malicious packages in NPM and >>Oh my gosh. So that's a super, that's a jar number even. I know it was gonna be huge, but Holy mo. >>Yeah. So that's a software supply chain in actually right there. So that's, that's open source. Everything's out there. What's, how do, how does, how do you guys fix that? >>Yeah, so per peria kind of shifts the whole model. So when, when you think about a system that can be sustained, it has to be something which, which is not just one company. It has to be a, a, a set of companies, be vendor neutral and be decentralized. So that's why we donated it to the Continuous Delivery Foundation. So that can be that governance body, which, which makes sure it's not a single company, it is to use modern technologies. So you, you, you just need something which is immutable, so it can't be changed. So you can rely on it. It has to have a strong transaction ledger so you can see all of the history of it. You can build up your software, build materials off of it, and it, it has to have a strong peer-to-peer architecture, so it can be sustained long term. >>Steven, you mentioned something I want to just get back to. You mentioned outages and disruption. I, you didn't, you didn't say just the outages, but this whole disruption angle is interesting if something happens. Talk about the impact of the developer. They stalled, inefficiencies create basically disruption. >>No, I mean, if, if, so, so if you think about most DevOps teams in big companies, they support hundreds or thousands of teams and an hour of outage. All those developers, they, they can't program, they can't work. And that's, that's a huge loss of productivity for the company. Now, if you, if you take that up a level when MPM goes down for an hour, how many millions of man hours are wasted by not being able to get your builds working by not being able to get your codes to compile. Like it's, it's >>Like, yeah, I mean, it's almost hard to fathom. I mean, everyone's, It's stopped. Exactly. It's literally like having the plug pulled >>Exactly on whenever you're working on, That's, that's the fundamental problem we're trying to solve. Is it, it needs to be on a, like a well supported, well architected peer to peer network with some strong backing from big companies. So the company is working on Persia, include J Frog, which who I work for, Docker, Oracle. We have Deploy hub, Huawei, a whole bunch of other folks who are also helping out. And when you look at all of those folks, they all have different interests, but it's designed in a way where no single party has control over the network. So really it's, it's a system system. You, you're not relying upon one company or one logo. You're relying upon a well-architected open source implementation that everyone can rely >>On. That's shared software, but it's kind of a fault tolerant feature too. It's like, okay, if something happens here, you have a distributed piece of it, decentralized, you're not gonna go down. You can remediate. All right, so where's this go next? I mean, cuz we've been talking about the role of developer. This needs to be a modern, I won't say modern upgrade, but like a modern workflow or value chain. What's your vision? How do you see that? Cuz you're the center of the CD foundation coming together. People are gonna be coalescing multiple groups. Yeah. >>What's the, No, I think this is a good point. So there, there's a, a lot of different continuous delivery, continuous integration technologies. We're actually, from a Linux Foundation standpoint, we're coalescing all the continued delivery events into one big conference >>Next. You just made an announcement about this earlier this week. Tell us about CD events. What's going on, what's in, what's in the cooker? >>Yeah, and I think one of the big announcements we had was the 0.1 release of CD events. And CD events allows you to take all these systems and connect them in an event scalable, event oriented architecture. The first integration is between Tecton and Capin. So now you can get CD events flowing cleanly between your, your continuous delivery and your observability. And this extends through your entire DevOps pipeline. We all, we all need a standards based framework Yep. For how we get all the disparate continuous integration, continuous delivery, observability systems to, to work together. That's also high performance. It scales with our needs and it, it kind of gives you a future architecture to build on top of. So a lot of the companies I was talking with at the CD summit Yeah. They were very excited about not only using this with the projects we announced, but using this internally as an architecture to build their own DevOps pipelines on. >>I bet that feels good to hear. >>Yeah, absolutely. Yeah. >>Yeah. You mentioned Teton, they just graduated. I saw how many projects have graduated? >>So we have two graduated projects right now. We have Jenkins, which is the first graduated project. Now Tecton is also graduated. And I think this shows that for Tecton it was, it was time, the very mature project, great support, getting a lot of users and having them join the set of graduated projects. And the continuous delivery foundation is a really strong portfolio. And we have a bunch of other projects which also are on their way towards graduation. >>Feels like a moment of social proof I bet. >>For you all. Yeah, yeah. Yeah. No, it's really good. Yeah. >>How long has the CD Foundation been around? >>The CD foundation has been around for, i, I won't wanna say the exact number of years, a few years now. >>Okay. >>But I, I think that it, it was formed because what we wanted is we wanted a foundation which was purpose built. So CNCF is a great foundation. It has a very large umbrella of projects and it takes kind of that big umbrella approach where a lot of different efforts are joining it, a lot of things are happening and you can get good traction, but it produces its own bottlenecks in process. Having a foundation which is just about continuous delivery caters to more of a DevOps, professional DevOps audience. I think this, this gives a good platform for best practices. We're working on a new CDF best practices Yeah. Guide. We're working when use cases with all the member companies. And it, it gives that thought leadership platform for continuous delivery, which you need to be an expert in that area >>And the best practices too. And to identify the issues. Because at the end of the day, with the big thing that's coming out of this is velocity and more developers coming on board. I mean, this is the big thing. More people doing more. Yeah. Well yeah, I mean you take this open source continuous thunder away, you have more developers coming in, they be more productive and then people are gonna even either on the DevOps side or on the straight AP upside. And this is gonna be a huge issue. And the other thing that comes out that I wanna get your thoughts on is the supply chain issue you talked about is hot verifications and certifications of code is such big issue. Can you share your thoughts on that? Because Yeah, this is become, I won't say a business model for some companies, but it's also becoming critical for security that codes verified. >>Yeah. Okay. So I, I think one of, one of the things which we're specifically doing with the Peria project, which is unique, is rather than distributing, for example, libraries that you developed on your laptop and compiled there, or maybe they were built on, you know, a runner somewhere like Travis CI or GitHub actions, all the libraries being distributed on Persia are built by the authorized nodes in the network. And then they're, they're verified across all of the authorized nodes. So you nice, you have a, a gar, the basic guarantee we're giving you is when you download something from the Peria network, you'll get exactly the same binary as if you built it yourself from source. >>So there's a lot of trust >>And, and transparency. Yeah, exactly. And if you remember back to like kind of the seminal project, which kicked off this whole supply chain security like, like whirlwind it was SolarWinds. Yeah. Yeah. And the exact problem they hit was the build ran, it produced a result, they modified the code of the bill of the resulting binary and then they signed it. So if you built with the same source and then you went through that same process a second time, you would've gotten a different result, which was a malicious pre right. Yeah. And it's very hard to risk take, to take a binary file Yep. And determine if there's malicious code in it. Cuz it's not like source code. You can't inspect it, you can't do a code audit. It's totally different. So I think we're solving a key part of this with Persia, where you're freeing open source projects from the possibility of having their binaries, their packages, their end reduces, tampered with. And also upstream from this, you do want to have verification of prs, people doing code reviews, making sure that they're looking at the source code. And I think there's a lot of good efforts going on in the open source security foundation. So I'm also on the governing board of Open ssf >>To Do you sleep? You have three jobs you've said on camera? No, I can't even imagine. Yeah. Didn't >>You just spin that out from this open source security? Is that the new one they >>Spun out? Yeah, So the Open Source Security foundation is one of the new Linux Foundation projects. They, they have been around for a couple years, but they did a big reboot last year around this time. And I think what they really did a good job of now is bringing all the industry players to the table, having dialogue with government agencies, figuring out like, what do we need to do to support open source projects? Is it more investment in memory, safe languages? Do we need to have more investment in, in code audits or like security reviews of opensource projects. Lot of things. And all of those things require money investments. And that's what all the companies, including Jay Frogger doing to advance open source supply chain security. I >>Mean, it's, it's really kind of interesting to watch some different demographics of the developers and the vendors and the customers. On one hand, if you're a hardware person company, you have, you talk zero trust your software, your top trust, so your trusted code, and you got zero trust. It's interesting, depending on where you're coming from, they're all trying to achieve the same thing. It means zero trust. Makes sense. But then also I got code, I I want trust. Trust and verified. So security is in everything now. So code. So how do you see that traversing over? Is it just semantics or what's your view on that? >>The, the right way of looking at security is from the standpoint of the hacker, because they're always looking for >>Well said, very well said, New >>Loop, hope, new loopholes, new exploits. And they're, they're very, very smart people. And I think when you, when you look some >>Of the smartest >>Yeah, yeah, yeah. I, I, I work with, well former hackers now, security researchers, >>They converted, they're >>Recruited. But when you look at them, there's like two main classes of like, like types of exploits. So some, some attacker groups. What they're looking for is they're looking for pulse zero days, CVEs, like existing vulnerabilities that they can exploit to break into systems. But there's an increasing number of attackers who are now on the opposite end of the spectrum. And what they're doing is they're creating their own exploits. So, oh, they're for example, putting malicious code into open source projects. Little >>Trojan horse status. Yeah. >>They're they're getting their little Trojan horses in. Yeah. Or they're finding supply chain attacks by maybe uploading a malicious library to NPM or to pii. And by creating these attacks, especially ones that start at the top of the supply chain, you have such a large reach. >>I was just gonna say, it could be a whole, almost gives me chills as we're talking about it, the systemic, So this is this >>Gnarly nation state attackers, like people who wanted serious >>Damages. Engineered hack just said they're high, highly funded. Highly skilled. Exactly. Highly agile, highly focused. >>Yes. >>Teams, team. Not in the teams. >>Yeah. And so, so one, one example of this, which actually netted quite a lot of money for the, for the hacker who exposed it was, you guys probably heard about this, but it was a, an attack where they uploaded a malicious library to npm with the same exact namespace as a corporate library and clever, >>Creepy. >>It's called a dependency injection attack. And what happens is if you, if you don't have the right sort of security package management guidelines inside your company, and it's just looking for the latest version of merging multiple repositories as like a, like a single view. A lot of companies were accidentally picking up the latest version, which was out in npm uploaded by Alex Spearson was the one who did the, the attack. And he simultaneously reported bug bounties on like a dozen different companies and netted 130 k. Wow. So like these sort of attacks that they're real Yep. They're exploitable. And the, the hackers >>Complex >>Are finding these sort of attacks now in our supply chain are the ones who really are the most dangerous. That's the biggest threat to us. >>Yeah. And we have stacker ones out there. You got a bunch of other services, the white hat hackers get the bounties. That's really important. All right. What's next? What's your vision of this show as we end Coan? What's the most important story coming outta Coan in your opinion? And what are you guys doing next? >>Well, I, I actually think this is, this is probably not what most hooks would say is the most exciting story to con, but I find this personally the best is >>I can't wait for this now. >>So, on, on Sunday, the CNCF ran the first kids' day. >>Oh. >>And so they had a, a free kids workshop for, you know, underprivileged kids for >>About, That's >>Detroit area. It was, it was taught by some of the folks from the CNCF community. So Arro, Eric hen my, my older daughter, Cassandra's also an instructor. So she also was teaching a raspberry pie workshop. >>Amazing. And she's >>Here and Yeah, Yeah. She's also here at the show. And when you think about it, you know, there's always, there's, there's, you know, hundreds of announcements this week, A lot of exciting technologies, some of which we've talked about. Yeah. But it's, it's really what matters is the community. >>It this is a community first event >>And the people, and like, if we're giving back to the community and helping Detroit's kids to get better at technology, to get educated, I think that it's a worthwhile for all of us to be here. >>What a beautiful way to close it. That is such, I'm so glad you brought that up and brought that to our attention. I wasn't aware of that. Did you know that was >>Happening, John? No, I know about that. Yeah. No, that was, And that's next generation too. And what we need, we need to get down into the elementary schools. We gotta get to the kids. They're all doing robotics club anyway in high school. Computer science is now, now a >>Sport, in my opinion. Well, I think that if you're in a privileged community, though, I don't think that every school's doing robotics. And >>That's why Well, Cal Poly, Cal Poly and the universities are stepping up and I think CNCF leadership is amazing here. And we need more of it. I mean, I'm, I'm bullish on this. I love it. And I think that's a really great story. No, >>I, I am. Absolutely. And, and it just goes to show how committed CNF is to community, Putting community first and Detroit. There has been such a celebration of Detroit this whole week. Stephen, thank you so much for joining us on the show. Best Wishes with the CD Foundation. John, thanks for the banter as always. And thank you for tuning in to us here live on the cube in Detroit, Michigan. I'm Savannah Peterson and we are having the best day. I hope you are too.

>> From theCUBE Studios in Palo Alto and Boston, bringing you data-driven insights from theCUBE in ETR. This is "Breaking Analysis" with Dave Vellante. >> Cisco is a company at the crossroads. It's transitioning from a high margin hardware business to a software subscription-based model, which also should be high margin through both organic moves and targeted acquisitions. It's doing so in the context of massive macro shifts to digital in the cloud. We believe Cisco's dominant position in networking combined with a large market opportunity and a strong track record of earning customer trust, put the company in a good position to capitalize on cloud momentum. However, there are clear challenges ahead for Cisco, not the least of which is the growing complexity of its portfolio, a large legacy business, and the mandate to maintain its higher profitability profile as it transitions into a new business model. Hello and welcome to this week's Wiki-bond cube insights powered by ETR. In this breaking analysis, we welcome in Zeus Kerravala, who's the founder and principal analyst at ZK Research, long time Cisco watcher who together with me crafted the premise of today's session. Zeus, great to see you welcome to the program. >> Thanks Dave. It's always a pleasure to be with you guys. >> Okay, here's what we're going to talk about today, set the agenda. The catalyst for this session, Zeus and I attended Cisco's financial analyst day. We received a day and a half of firehose presentations, drill downs, interactions, Q and A with Cisco execs and one key customer. So we're going to share our takeaways from these sessions and add our additional thoughts. Now, in particular, we're going to talk about Cisco's TAM, its transformation to a subscription-based model, and how we see that evolving. As always, we're going to bring in some ETR spending data for context and get Zeus' take on what that tells us. And we'll end with a summary of Cisco's cloud strategy and outlook for how it could win in the cloud. So let's talk about Cisco's sort of structure and TAM opportunities. First, Zeus, Cisco has four main lines of business where it's organized it's executives around sort of four product areas. And it's got a large service component as well. Network equipment, SP routing, data center, collaboration that security, and as I say services, that's not necessarily how it's going to market, but that's kind of the way it organizes its ELT, its executive leadership team. >> Yeah, the in fact, the ELT has been organized around those products, as you said. It used to report to the street three product segments, infrastructure platforms, which was by far the biggest, it was all their networking equipment, then applications, and then security. Now it's moved to five new segments, secure agile networks, hybrid work, end to end security, internet for the future and optimized app experiences. And I think what Cisco's trying to do is align their, the way they report along the lines of the way customers buy. 'Cause I think before, you know, they had a very simplistic model before. It was just infrastructure, apps, and security. The ELT is organized around product roadmap and the product innovation, but that's not necessarily the way customers purchase things and so, purchase things so I think they've tried to change things a little bit there. When you look at those segments though, you know, by, it's interesting. They're all big, right? So, by far the biggest distilled networking, which is almost a hundred billion dollar TAM as they reported and they have it growing a about a 9% CAGR as reported by other analyst firms. And when you think about how mature networking is Dave, the fact that that's still growing at high single digit CAGR is still pretty remarkable. So I think that's one of those things that, you know, watchers of Cisco historically have been calling for the network to be commoditized for decades. For as long as I've been watching Cisco, we've been, people have been waiting for the network to be commoditized. My thesis has always been, if you can drive enough innovation into things, you can stave off commoditization and that's what they've done. But that's really the anchor for them to sell all their other products, some of which are higher margin, some which are a little bit sore, but they're all good high margin businesses to your point. >> Awesome. We're going to dig into that. So, so they flattened the organization when Geckler left. You've got Todd Nightingale, Jonathan Davidson, Liz Centoni, and Jeetu Patel who we heard from and we'll make some comments on what we heard from them. One of the big takeaways at the financial analysts meeting was on the TAM, as you just mentioned. Liz Centoni who also is heavily involved in strategy and the CFO Scott Herren, showed this slide, which speaks to the company's TAM and the organizational structure that you were just talking about. So the big message was that Cisco has got a large and growing market, you know, no shortage of available market. Somewhere between eight and 900 billion, depending on which of the slides you pull out of the deck. And ironically Zeus, when you look at the current markets number here on the right hand side of this slide, 260 billion, it just about matches the company's market cap. Maybe an interesting coincidence, but at any rate, what was your takeaway from this data? >> Well, I think, you know, the big takeaway from the data is there's still a lot of room ahead for Cisco to grow, right? Again, this is a, it's a company that I think most people would put in the camp of legacy IT vendor, just because of how long they've been around. But they have done a very good job of staving off innovation. And part of that is just these markets that they play in continue to grow and they continue to have challenges that they can solve. I think one of the things Cisco has done though, since the arrival of Chuck Robbins, is they don't fight these trends anymore, Dave. I know prior to Chuck's arrival, they really fought the tide of software defined networking and you know, trends like that, and even cloud to some extent. And I remember one of the first meetings I had with Chuck, I asked him about that and he said that Cisco will never do that again. That under his watch, if customers are going through a market transition, Cisco wants to lead them through it, not try and hold them back. And I think for that reason, they're able to look at, all of those trends and try and take a leadership position in them, even though you might look at some of those and feel that some of them might be detrimental to Cisco's business in the short term. So something like software defined WANs, which you would throw into secure agile networks, certainly doesn't, may not carry the same kind of RPOs and margins with it that their traditional routers did, but ultimately customers are going to buy it and Cisco would like to be the ones to sell it to them. >> You know, you bring up a great point. This industry is littered, there's a graveyard of executives who fought the trend. Many people, some people remember Ken Olson of Digital Equipment Corporation. "Unix is snake oil," is what he said. IBM mainframe guys said, "PCs are a toy." And of course the history, they were the wrong side of history. The other big takeaway was the shift to software in subscription. They really made a big point of this. Here's a chart Cisco showed a couple of times to make the point that it's one of the largest software companies in the world. You know, in the top 10. They also made the point that Chuck Robbins, when he joined in 2015, and since that time, it's nearly 4x'ed it's subscription software revenue, and roughly doubled its software sales. And it now has an RPO, remaining performance obligations, that exceeds 30 billion. And it's committing to grow its subscription business in the forward-looking statements by 15 to 17% CAGR through 25, which would imply about a doubling of these, the blue lines. Zeus, it's unclear if that forward-looking forecast is just software. I presume it includes some services, but as Herren pointed out, over time, these services will be bundled into the product revenue, same way SAS companies do it. But the point is Cisco is committed, like many of their peers, to moving to an ARR model. But please, share your thoughts on Cisco's move to software subscriptions and how you see the future of consumption-based pricing. >> Yeah, this has been a big shift for Cisco, obviously. It's one that's highly disruptive. It's one that I know gave their partners a lot of angst for a long time because when you sell things upfront, you get a big check for selling that, right? And when you sell things in a subscription model, you get a much smaller check for a number of months over the period of the contract. It also changes the way you deal with the customer. When you sell a one-time product, you basically wipe your hands. You come back in three or four years and say, "it's time to upgrade." When you sell a subscription, now, the one thing that I've tried to talk to Cisco and its partners about is customers don't renew things they don't use. And so it becomes incumbent on the partner, it becomes incumbent upon Cisco to make sure that things that the customer is subscribing to, that they do use. And so Cisco's had to create a customer success organization. They've had to help their partners create those customer success organizations. So it's really changed the model. And Cisco not only made the shift, they've done it faster than they actually had originally forecast. So during the financial analyst day, they actually touted their execution on software, noting that it hit it's 30% revenue as percent of total target well before it was supposed to, it's actually exceeded its targets. And now it's looking to increase that to, it actually raised its guidance in this area a little bit by a few percentage points, looking out over the next few years. And so it's moved to the subscription model, Dave, the thing that you brought up, which I do see as somewhat of a challenge is the shift to consumption-based pricing. So subscription is one thing in that I write you a check every month for the same amount. When I go to the consumption-based pricing, that's easy to do for cloud services, things like WebEx or Duo or, you know, CloudLock, some of the security products. That that shift should be relatively simple. If customers want to buy it that way. It's unclear as to how you do that when you're selling on-prem equipment with the software add-on to it because in that case, you have to put metering technology in to understand how much they're using. You have to have a minimum baseline to start with. They've done it in some respects. The old HCS product that they sold, the Telcos, actually was sold with a minimum commit and then they tacked on a utilization on top of that. So maybe they move into that kind of model. But I know it's something that they've, they get asked about a lot. I know they're still thinking about it, but it's something that I believe is coming and it's going to come pretty fast. >> I want to pick up on that because I think, you know, they made the point that we're one of the top 10 software companies in the world. It's very difficult for hardware companies to make the transition to software. You know, HP couldn't do it. >> Well, no one's done it. >> Well, IBM has kind of done it, but they really struggle. It's kind of this mishmash of tooling and software products that aren't really well-integrated. But, I would say this, everybody now, Cisco, Dell, HPE with GreenLake, Lenovo, pretty much all the traditional hardware players are trying to move to an as a service model or at least for a portion of their business. HPE's all in, Dell transitioning. And for the most part, I would make the following observation. And I'd love to get your thoughts on this. They're pretty much following a SAS like model, which in my view is outdated and kind of flawed from a customer standpoint. All these guys say, "Hey, we're doing this because "this is what the customers want." I think the cloud is really a true consumption based model. And if you look at modern SAS companies, a lot of the startups, they're moving to a consumption based model. You see that with Snowflake, you see that with Stripe. Now they will offer incentives. But most of the traditional enterprise players, they're saying, "Okay, pay us upfront, "commit to some base level. "If you go over it, you know, "we'll charge you for it. "If you go under it, you're still going to pay "for that base level." So it's not true consumption base. It's not really necessarily the customer's best interest. So that's, I think there's some learnings there that are going to have to play out. >> Yeah, the reason customers are shying away from that SAS type model, I think during the pandemic, the one thing we learned, Dave, is that the business will ebb and flow greatly from month to month sometimes. And I was talking with somebody that worked for one of the big hotel chains, and she was telling me that what their CRM providers, she wouldn't tell me who it was, except said it rhymed with Shmalesforce, that their utilization of it went from, you know, from a nice steady level to spiking really high when customers started calling in to cancel hotel rooms. And then it dropped down to almost nothing as we went through that period of stay at home. And now it's risen back up. And so for her, she wanted to move to a consumption-based model because what happens otherwise is you wind up buying for peak utilization, your software subscriptions go largely underutilized the majority of the year, and you wind up paying, you know, a lot more than you need to. If you go to more of a true consumption model, it's harder to model out from a financial perspective 'cause there's a lot of ebbs and flows in the business, but over a longer period of time, it's more cost-effective, right? And so the, again, what the pandemic taught us was we don't really know what we're going to need from a consumption standpoint, you know, nevermind a year from now, maybe even six months from now. And consumption just creates a lot more flexibility and agility. You can scale up, you can scale down. You can bring in users, you can take out users, you can add consultants, things like that. And it just, it's much more aligned with the way businesses are run today. >> Yeah, churn is a silent killer of a software company. And so there's retention is the key here. So again, I think there's lots of learning. Let's put Cisco into context with some of its peers. So this chart we developed compares five companies to Cisco. Core Dell, meaning Dell, without VMware. VMware, HPE, IBM, we've put an AWS, and then Cisco as, IBM, AWS and Cisco is the integrated plays. So the chart shows the latest quarterly revenue multiplied by four to get a run rate, a three-year growth outlook, gross margin percentage, market cap, and revenue multiple. And the key points here are that one, Cisco has got a pretty awesome business model. It's got 60% gross margin, strong operating margins, not shown here, but in the mid twenties, 25%. It's got a higher growth rate than most of its peers. And as such, a much better, multiple than say, for instance, Core Dell gets 33 cents on the revenue dollar. HPE is double that. IBM's below two X. Cisco's revenue multiple rivals VMware, which is a pure software company. Now in a large part that's because VMware stock took a hit recently, but still the point is obvious. Cisco's got a great business. Now for context, we've added AWS, which blows away any company on this chart. We've inferred a market cap of nearly 600 billion, which frankly is conservative at a 10 X revenue multiple given it's inferred margins and growth rate. Now Zeus, if AWS were a separate company, it could have a market cap that approached 800 billion in my view. But what does this data tell you? >> Well, it just tells me that Cisco continues to be a very well-run company that has staved off commoditization, despite the calling for it for years. And I think the big lesson, and I've talked to financial analysts about this over the years, is that if, I don't really believe anything in this world is a commodity, Dave. I think even when Cisco went to the server market, if you remember back then, they created a new way of handling memory management. They were getting well above average margins for service, albeit less than Cisco's network margins, but still above average for server margins. And so I think if you can continue to innovate, you will see the margin stay where they are. You will see customers continue to buy and refresh. And I think one of the challenges Cisco's had in the past, and this is where the subscription business will help, is getting customers to stay with the latest and greatest. Prior to this refresh of network equipment, some of the stuff that I've seen in the fields, 10, 15 years old, once you move to that sell me a box and then tack on the subscription revenue that you pay month by month, you do drive more consistent refresh. Think about the way you just handle your own mobile phone. If you had to go pay, you know, a thousand dollars every three years, you might not do it at that three-year cycle. If you pay 40 bucks a month, every time there's a new phone, you're going to take it, right? So I think Cisco is able to drive greater, better refresh, keep their customers current, keep the features in there. And we've seen that with a lot of the new products. The new Cat 9,000, some of the new service provider products, the new wifi products, they've all done very well. In fact, they've all outpaced their previous generation products as far as growth rate goes. And so I think that is a testament to the way they've run the business. But I do think when people bucket Cisco in with HP and Dell, and I understand why they do, their businesses were similar at one time, it's really not a true comparison anymore. I think Cisco has completely changed their business and they're not trying to commoditize markets, they're trying to drive innovation and keep the margins up, where I think HP and Dell tend to really compete on price versus innovation. >> Well, and we are going to get to this point about the tailwinds and headwinds and cloud, and how Cisco to do it. But, to your point about, you know, the cell phone analogy. To the extent that Cisco can make that seamless for customers could hide that underlying complexity, that's going to be critical for the cloud. Now, but before we get there, I want to talk about one of the reasons why Cisco such a high multiple, and has been able to preserve its margins, to your point, not being commoditized. And it's been able to grow both organically, but also has a strong history of M and A. It's this chart shows a dominant position in core networking. So this shows, so ETR data within the Fortune 500. It plots companies in the ETR taxonomy in two dimensions, net score on the vertical axis, which is a measure of spending velocity, and market share on the horizontal axis, which is a measure of presence in the survey. It's not like IDC market share, it's mentioned market share if you will. The point is Cisco is far and away the most pervasive player in the market, it's generally held its dominant position. Although, it's been under pressure in the last few years in core networking, but it retains or maintains a very respectable net score and consistently performs well for such a large company. Zeus, anything you'd add with respect to Cisco's core networking business? >> Yeah, it's maintained a dominant network position historically. I think part of because it drives good products, but also because the competitive landscape, historically has been pretty weak, right? We saw companies like 3Com and Nortel who aren't around anymore. It'll be interesting to see moving forward now that companies like VMware are involved in networking. AWS is interested in networking. Arista is a much stronger company. You know, Juniper bought Mist and is in better position. Even Extreme Networks who most people thought was dead a few years ago has made a number of acquisitions and is now a billion dollar company. So while Cisco has done a great job of execution, they've done a great job on the innovation side, their competitive landscape, looking out over the next five years, I think is going to be more difficult than it has been over the previous five years. And largely, Dave, I think that's good for Cisco. I think whenever Cisco's pressed a little bit from competition, they tend to step on the innovation gas a little bit more. And I look back and even just the transition when VMware bought Nicira, that got Cisco's SDN business into gear, like nothing else could have, right? So competition for that company, they always seem to respond well to it. >> So, let's break down Cisco's net score a little bit. Explain why the company has been able to hold its spending momentum despite its large size. This will give you a little insight to the survey. So this chart shows the granular components of net score. The lime green is new adoptions to Cisco. The forest green is spending more than 6%. The gray is flat plus or minus 5%. The pink is spending drops by more than 5%. And the red is we're chucking the platform, we're getting off. And Cisco's overall net score here is 25%, which for a company of its size speaks to the relationships that it has with customers. It's of course got a fat middle in the gray area, like all sort of large established companies. But very low defections as well, it's got low new adoptions. But very respectable. So that is background, Zeus. Let's look at spending momentum over time across Cisco's portfolio. So this chart shows Cisco's net score by that methodology within the ETR taxonomy for Cisco over three survey periods. And what jumps out is Meraki on the left, very strong. Virtualization business, its core networking, analytics and security, all showing upward momentum. AppD is a little bit concerning, but that could be related to Cisco's sort of pivot to full stack observability. So maybe AppD is being bundled there. Although some practitioners have cited to us some concerns in that space. And then WebEx at the end of the chart, it's showing some relative strength, but not that high. Zeus, maybe you could comment on Meraki and any other takeaways across the portfolio. >> Yeah, Meraki has proven to be an excellent acquisition for Cisco. In fact, you might, I think it's arguable to say it's its best acquisition in history going all the way back to camp Kalpana and Grand Junction, the ones that brought up catalyst switches. So, in fact, I think Meraki's revenue might be larger than security now. So, that shows you the momentum it has. I think one of the lessons it brought to Cisco was that simpler is better, sometimes. I think when they first bought Meraki, the way Meraki's deployed, it's very easy to set up. There's a lot of engineering work though that goes into making a product simple to use. And I think a lot of Cisco engineers historically looked at Meraki as, that's a little bit of a toy. It's meant for small businesses, things like that, but it's not for enterprise. But, Rocky's done a nice job of expanding the portfolio, of leveraging the cloud for analytics and showing you a lot of things that you wouldn't necessarily get from traditional networking equipment. And one of the things that I was really delighted to see was when they put Todd Nightingale in charge of all the networking business, because that showed to me that Chuck Robbins understood that the things Meraki were doing were right and they infuse a little bit of Meraki into the rest of the company. You know, that's certainly a good thing. The other areas that you showed on the chart, not really a surprise, Dave. When you think of the shift hybrid work and you think of the, some of the other transitions going on, I think you would expect to see the server business in decline, the storage business, you know, maybe in a little bit of decline, just because people aren't building out data centers. Where the other ones are related more to hybrid working, hybrid cloud, things like that. So it is what you would expect. The WebEx one was interesting too, because it did show somewhat of a dip and then a rise. And I think that's indicative of what we've seen in the collaboration space since the pandemic came about. Companies like Zoom and RingCentral really got a lot of the headlines. Again, when you, the comment I made on competition, Cisco got caught a little bit flat-footed, they've caught up in features and now they really stepped on the gas there. Chuck joked that he gave the WebEx team a bit of a blank check to go do what it had to do. And I don't think that was a joke. I think he actually did that because they've added more features into WebEx in the last year then I think they did the previous five years before that. >> Well, let's just drill into video conferencing real quick here, if we could. Here's that two dimensional view, again, showing net score against market share or pervasiveness of mentions, and you can see Microsoft Teams in the upper right. I mean, it's off the chart, literally. Zoom's well ahead of Cisco in terms of, you know, mentions presence. And that could be a spate of freemium, you know, but it's basically a three horse race in this game. And Cisco, I don't think is trying to take Zoom head on, rather it seems to be making WebEx a core part of its broader collaboration agenda. But Zeus, maybe you could comment. >> Well, it's all coming together, right? So, it's hard to decouple calling from video from meetings. All of the vendors, including Teams, are going after the hybrid work experience. And if you believe the future is hybrid and not just work from home, then Cisco does have a pretty interesting advantage because it's the only one that makes its own end points, where Teams and Zoom doesn't. And so that end to end experience it can deliver. The Microsoft Teams one's interesting because that product, frankly, when you talk to users, it doesn't have a great user score, like as far as user satisfaction goes, but the one thing Microsoft has done a very good job of is bundling it in to the Office365 licenses, making it very easy for IT to deploy. Zoom is a little bit in the middle where they've appealed to the users. They've done a better job of appealing to IT, but there is a, there is a battleground now going on where video's not just video. It includes calling, includes meetings, includes room systems now, and I think this hybrid work friend is going to change the way we think about these meeting tools. >> Now we'd be remiss if we didn't spend a moment talking about security as a key part of Cisco's business. And we have a graphic on this same kind of X, Y. And it's been, we've seen several quarters of growth. Although, the last quarter security growth was in the low single digits, but Cisco is a major player in security. And this X, Y graph shows, they've got both a large presence and a solid spending momentum. Not nearly as much momentum as Okta or Zscaler or a CrowdStrike and some of the smaller companies, but they're, these guys are on a rocket ship, but others that we featured in these episodes, but much more than respectable for Cisco. And security is critical to the strategy. It's a big part of the subscriber base. And the last thing, Zeus, I'll say about Cisco made the point in analyst day, that this market is crowded. You can see that in this chart. And their goal is to simplify this picture and make it easier for customers to secure their data and apps. But that's not easy, Zeus. What are your thoughts on Cisco's security opportunities? >> Yeah, I've been waiting for Cisco go to break up in security a little more than it has. I do think, I was talking with a CSO the other day, Dave, that said to me he's starting to understand that you don't have to have best of breed everywhere to have best in class threat protection. In fact, there's a lot of buyers now will tell you that if you try and have best of breed everywhere, it actually creates a negative when it comes to threat protection because keeping all the policies and things up to date is very, very difficult. And so the industry is moving more to a platform model, right? Now, the challenge for Cisco is how do you get that, the customer to think of the network as part of the platform? Because while the platform model, I think, is starting to gain traction, FloridaNet, Palo Alto, even McAfee, companies like that also have their own version of a security platform. And if you look at the financial performance of companies like FloridaNet and Palo Alto over the past, you know, over the past couple of years, they've been through the roof, right? And so I think an interesting and unique challenge for Cisco is can they convince the security buyer that the network is as important a part of that platform as any other component? If they can do that, I think they can break away from the pack. If not, then they'll stay mixed in with those, you know, Palo, FloridaNet, Checkpoint, and, you know, and Cisco, in that mix. But I do think that may present their single biggest needle moving opportunity just because of how big the security TAM is, and the fact that there is no de facto leader in security today. If they could gain the same kind of position in security as they have a networking, who, I mean, that would move the needle like no other market would. >> Yeah, it's really interesting that they're coming at security, obviously from a position of networking strength. You've got, to your point, you've got best of breed, Okta in identity, you got CrowdStrike in endpoint, Zscaler in cloud security. They're all growing like crazy. And you got Cisco and you know, Palo Alto, CSOs tell us they want to work with Palo Alto because they're the thought leader and they're obviously a major player here. You mentioned FloridaNet, there's a zillion others. We could talk all day about security. But let's bring it back to cloud. We've talked about a number of the piece in Cisco's portfolio, and we haven't really spent any time on full stack observability, which is a big push for Cisco with AppD, Intersight and the ThousandEyes acquisition. And that plays into this equation. But my take, Zeus, is Cisco has a number of cloud knobs that it can turn, it sells core networking equipment to hyperscalers. It can be the abstraction layer to connect on-prem to the cloud and hybrid and across clouds. And it's in a good position with Telcos too, to go after the 5G. But let's use this chart to talk about Cisco's cloud prospects. It's an ETR cut of the cloud customer spending. So we cut it by cloud customers. And they're are, I don't know, 800 or so in the survey. And then looking at various companies performance within that cut. So these are companies that compete, or in the case of HashiCorp, partner with Cisco at some level. Let me just set this up and get your take. So the insert on the chart by the way shows the raw data that positions each dot, the net score and the shared n, i.e. the number of accounts in the survey that responded. The key points, first of all, Azure and AWS, dominant players in cloud. GCP is a distant third. We've reported on that a lot. Not only are these two companies big, they have spending momentum on their platforms. They're growing, they are on that flywheel. Second point, VMware and Cisco are very prominent. They have huge customer bases. And while they're often on a collision course, there's lots of room in cloud for multiple players. When we plotted some other Cisco properties like AppD and Meraki, which as we said, is strong. And then for context, we've placed Dell, HPE, Aruba, IBM and Oracle. And also VMware cloud and AWS, which is notable on its elevation. And as I say, we've added HashiCorp because they're critical partner of Cisco and it's a multi-cloud play. Okay, Zeus, there's the setup. What does Cisco have to do to make the cloud a tailwind? Let's talk about strategy, tailwinds, headwinds, competition, and bottom line it for us. >> Yeah, well, I do think, well, I talked about security being the biggest needle mover for Cisco, I think its biggest challenge is convincing Wall Street in particular, that the cloud is a tailwind. I think if you look at the companies with the really high multiples to their stock, Dave, they're all ones where they're viewed as, they go along with the cloud ride, Right? So the, if you can associate yourself with the cloud and then people believe that the cloud is going to, more cloud equals more business, that obviously creates a better multiple because the cloud has almost infinite potential ahead of it. Now with respect to Cisco, I do think cloud has presented somewhat of a double-edged sword for Cisco. I don't believe the current consumption model for cloud is really a tailwind for Cisco, not really a headwind, but it doesn't really change Cisco's business. But I do think the very definition of cloud is changing before our eyes, Dave. And it's shifting away from centralized clouds. If you think of the way customers bought cloud before, it might have used AWS, it might've used Azure, but it really, that's not really multi-cloud, it's just multiple clouds in which I put things in these centralized resources. It's shifting more to this concept of distributed cloud in which a single application can be built using resources from your private cloud, for AWS, from Azure, from Edge locations, all the cloud providers have built their portfolios to support this concept of distributed cloud and what becomes important there, is a highly agile dynamic network. And in that case with distributed cloud, that is a tailwind for Cisco because now the network is that resource that ties all those distributed cloud components together. Now the network itself has to change. It needs to become a lot more agile and microservices and container friendly itself so I can spin up resources and, you know, in an Edge location, as fast as I can on-prem and things like that. But I do think it creates another wave of innovation and networking, and in that case, I think it does act as a tailwind for Cisco, aside from just the work it's done with the web scalers, you know, those types of companies. So, but I do think that Cisco needs to rethink its delivery model on network services somewhat to take advantage of that. >> At the analyst meeting, Cisco made the point that it does sell to the hyperscalers. It talked about the top six hyperscalers. You know, you had mentioned to me, maybe IBM and Oracle were in there. I always talk about four hyperscalers and only four, but that's fine. Here's my question. Practitioners have told me, buyers have told me, the more money and more workloads I put in the cloud, the less I spend with Cisco. Now, even though that might be Cisco gear powering those clouds, do you see that as a potential threat in that they don't own that relationship anymore and value will confer to the cloud players? >> Yeah, that's, I've heard that too. And I don't, I believe that's true when it comes to general purpose compute. You're probably not buying as many UCS servers and things like that because you are putting them in the cloud. But I do think you do need a refresh the network. I think the network becomes a very important role, plays a very important role there. The variant, the really interesting trend will be, what is your WAM look like? Do you have thousands of workers scattered all over the place, or do you just have a few centralized locations? So I think also, you know, Cisco will wind up providing connectivity within the cloud. If you think of the transition we've seen in other industries, Dave, as far as cloud goes, you think of, you know, F5, a company like that. People thought that AWS would commoditize F5's business because AWS provides their own load balancers, right? But what AWS provides is a very basic, very basic functionality and then use F5's virtual edition or a cloud edition for a lot of the advanced capabilities. And I think you'll see the same thing with the cloud that customers will start buying versions of Cisco that go in the cloud to drive a lot of those advanced capabilities that only Cisco delivers. And so I think you wind up buying more Cisco over time, although the per unit price of what you buy might be a little bit lower. If that makes sense here. >> It does, I think it makes a lot of sense and that fits into the cloud model. You know, you bring up a good point, the conversation with the customer was Rakuten. And that individual was essentially sharing with us, somebody was asking, one of the analysts was asking, "Well, what about the cloud guys? "Aren't they going to really threaten the whole Telco "industry and disrupt it?" And his point was, "Look at, this stuff is not trivial." So to your point, you know, maybe they'll provide some basic functionality. Kind of like they do in a lot of different areas. Data protection is another good example. Security is another good example. Where there's plenty of room for partners, competitors, of on-prem players to add value. And I've always said, "Look, the opportunity "is the cloud players spend 100 billion dollars a year "on CapEx." It's a gift to companies like Cisco who can build an abstraction layer that connects on-prem, cloud for hybrid, across clouds, out to the edge, and really be that layer that is that layer that takes advantage of cloud native, but also delivers that experience, I don't want to use the word seamlessly, but that experience across those clouds as the cloud expands. And that's fundamentally Cisco's cloud strategy, isn't it? >> Oh yeah. And I think people have underestimated over the years, how hard it is to build good networking products. Anybody can go get some silicon and build a product to connect two things together. The question is, can you do it at scale? Can you do it securely? And lots of companies have tried to commoditize networking, you know, White Boxes was looked at as the existential threat to Cisco. Huawei was looked at as the big threat to Cisco. And all of those have kind of come and gone because building high quality network equipment that scales is tough. And it's tougher than most people realize. And your other point on the cloud providers as well, they will provide a basic level of functionality. You know, AWS network equipment doesn't work in Azure. And Azure stuff doesn't work in Google, and Google doesn't work in AWS. And so you do need a third party to come in and act as almost the cloud middleware that can connect all those things together with a consistent set of policies. And that's what Cisco does really well. They did that, you know back when they were founded with routing protocols and you can think this is just an extension of what they're doing just up at the cloud layer. >> Excellent. Okay, Zeus, we're going to leave it there. Thanks to my guest today, Zeus Kerravala. Great analysis as always. Would love to have you back. Check out ZKresearch.com to reach him. Thank you again. >> Thank you, Dave. >> Now, remember I publish each week on Wikibond.com and siliconangle.com. All these episodes are available as podcasts, just search "Braking Analysis" podcast, and you can connect on Twitter at DVallante or email me David.Vallante@siliconangle.com. Thanks for the comments on LinkedIn. Check out etr.plus for all the survey action. This is Dave Vallante for theCUBE insights powered by ETR. Be well and we'll see you next time. (light music)

(upbeat music) >> Hi, today I'm going to talk about network analytics and what that means for telecommunications as we go forward, thinking about 5G, what the impact that's likely to have on network analytics and the data requirement, not just to run the network and to understand the network a little bit better, but also to inform the rest of the operation of the telecommunications business. So as we think about where we are in terms of network analytics and what that is over the last 20 years, the telecommunications industry has evolved its management infrastructure to abstract away from some of the specific technologies in the network. So what do we mean by that? Well, in the, when initial telecommunications networks were designed there were management systems that were built in. Eventually fault management systems, assurance systems, provisioning systems, and so on, were abstracted away. So it didn't matter what network technology had, whether it was a Nokia technology or Erickson technology or Huawei technology or whoever it happened to be. You could just look at your fault management system and understand where faults were happened. As we got into the last sort of 10, 15 years or so telecommunication service providers become, became more sophisticated in terms of their approach to data analytics and specifically network analytics and started asking questions about why and what if in relation to their network performance and network behavior. And so network analytics as a sort of an independent functioning was born and over time more and more data began to get loaded into the network analytics function. So today just about every carrier in the world has a network analytics function that deals with vast quantities of data in big data environments that are now being migrated to the cloud. As all telecommunications carriers are migrating as many IT workloads as possible to the cloud. So what are the things that are happening as we migrate to the cloud that drive enhancements in use cases and enhancements in scale in telecommunications network analytics? Well, 5G is the big thing, right? So 5G, it's not just another G in that sense. I mean, in some cases, in some senses it is 5G means greater bandwidth and lower latency and all those good things. So, you know, we can watch YouTube videos with less interference and, and less sluggish bandwidth and so on and so forth. But 5G is really about the enterprise and enterprise services transformation. 5G is a more secure kind of a network, but 5G is also a more pervasive network. 5G has a fundamentally different network topology than previous generations. So there's going to be more masts. And that means that you can have more pervasive connectivity. So things like IOT and edge applications, autonomous car, current smart cities, these kinds of things are all much better served because you've got more masts, that of course means that you're going to have a lot more data as well and we'll get to that. The second piece is immersive digital services. So with more masts, with more connectivity, with lower latency, with higher bandwidth with the potential is immense for services innovation. And we don't know what those services are going to be. We know that technologies like augmented reality, virtual reality, things like this have great potential, but we have yet to see where those commercial applications are going to be, but the innovation and the innovation potential for 5G is phenomenal. It certainly means that we're going to have a lot more edge devices. And that again is going to lead to an increase in the amount of data that we have available. And then the idea of pervasive connectivity when it comes to smart cities, autonomous cars, integrated traffic management systems, all of this kind of stuff, those kind of smart environments thrive where you've got this kind of pervasive connectivity, this persistent connection to the network. Again, that's going to drive more innovation. And again, because you've got these new connected devices, you're going to get even more data. So this rise, this exponential rise in data is really what's driving the change in network analytics. And there are four major vectors that are driving this increase in data in terms of both volume and in terms of speed. So the first thing is more physical elements. So we said already that 5G networks are going to have a different topology. 5G networks will have more devices, more masts. And so with more physical elements in the network, you're going to get more physical data coming off those physical networks. And so that needs to be aggregated and collected and managed and stored and analyzed and understood so that we can have a better understanding as to, you know, why things happened the way they do, why the network behaves in which they do in ways that it does and why devices that are connected to the network and ultimately of course, consumers, whether they be enterprises or retail customers behave in the way they do in relation to their interaction with the network. Edge nodes and devices. We're going to have an explosion in terms of the number of devices. We've already seen IOT devices with your different kinds of trackers and sensors that are hanging off the edge of the network, whether it's to make buildings smarter or car smart or people smarter in terms of having the measurements and the connectivity and all that sort of stuff. So the numbers of devices on the edge and beyond the edge are going to be phenomenal. One of the things that we've been trying to wrestle with as an industry over the last few years is where does a telco network end and where does the enterprise, or even the consumer network begin? It used to be very clear that, you know, the telco network ended at the router but now it's not that clear anymore because in the enterprise space, particularly with virtualized networking, which we're going to talk about in a second, you start to see end to end network services being deployed. And so are they being those services in some instances that are being managed by the service provider themselves, and in some cases by the enterprise client. Again, the line between where the telco network ends and where the enterprise or the consumer network begins is not clear. So those edge, the proliferation of devices at the edge, in terms of, you know, what those devices are, what the data yield is and what the policies are that need to govern those devices in terms of security and privacy and things like that, that's all going to be really, really important. Virtualized services, we just touched on that briefly. One of the big, big trends that's happening right now is not just the shift of IT operations onto the cloud, but the shift of the network onto the cloud, the virtualization of network infrastructure. And that has two major impacts. First of all, it means that you've got the agility and all of the scale benefits that you get from migrating workloads to the cloud, the elasticity and the growth and all that sort of stuff, but arguably more importantly for the telco it means that with a virtualized network infrastructure, you can offer entire networks to enterprise clients. So, you know, selling to a government department, for example, who's looking to stand up a system for, you know, certification of, you know, export certification, something like that. You can not just sell them the connectivity, but you can sell them the networking and the infrastructure in order to serve that entire end to end application. You could send, you could offer them in theory, an entire end-to-end communications network. And with 5G network slicing, they can even have their own little piece of the 5G bandwidth that's been allocated to gets a carrier and have a complete end to end environment. So the kinds of services that can be offered by telcos given virtualize network infrastructure are many and varied and it's an outstanding opportunity. But what it also means is that the number of network elements virtualized in this case is also exploding. And that means the amount of data that we're getting on, informing us as to how those network elements are behaving, how they're performing is going to go up as well. And then finally, AI complexity. So on the demand inside while historically network analytics, big data has been driven by returns in terms of data monetization, whether that's through cost avoidance or service assurance, or even revenue generation through data monetization and things like that. AI is transforming telecommunications and every other industry. The potential for autonomous operations is extremely attractive. And so understanding how the end-to-end telecommunication service delivery infrastructure works is essential as a training ground for AI models that can help to automate a huge amount of telecommunications operating processes. So the AI demand for data is just going through the roof. And so all of these things combined to mean that big data is getting explosive. It is absolutely going through the roof. So that's a huge thing that's happening. So as telecommunications companies around the world are looking at their network analytics infrastructure, which was initially designed for service insurance primarily and how they migrate that to the cloud. These things are impacting on those decisions because you're not just looking at migrating a workload to operate in the cloud that used to work in the data center. Now you're looking at migrating a workload but also expanding the use cases in that workload. And bear in mind many of those workloads are going to need to remain on-prem. So they'll need to be within a private cloud or at best a hybrid cloud environment in order to satisfy regulatory jurisdiction requirements. So let's talk about an example. So LG Uplus is fantastic service provider in Korea, huge growth in that business over the last, over the last 10, 15 years or so. And obviously most people would be familiar with LG, the electronics brand, maybe less so with, with LG Uplus, but they've been doing phenomenal work and were the first business in the world to launch commercial 5G in 2019. And so a huge milestone that they achieved. And at the same time they deployed the Network Real-time Analytics Platform or NRAP from a combination of Cloudera and our partner Caremark . Now, there were a number of things that were driving the requirement for the analytics platform at the time. Clearly the 5G launch was the big thing that they had in mind, but there were other things that were at play as well. So within the 5G launch, they were looking for a visibility of services and service assurance and service quality. So, you know, what services have been launched? How are they being taken up? What are the issues that are arising? Where the faults happening? Where are the problems? Because clearly when you launch a new service like that you want to understand and be on top of the issues as they arise. So that was really, really important. A second piece was and, you know, this is not a new story to any telco in the world, right? But there are silos in operation. And so it taking advantage of, or eliminating redundancies through the process of digital transformation it was really important. And so particular, the two silos between wired and the wireless sides of the business needed to come together so that there would be an integrated network management system for LG Uplus as they rolled out 5G. So eliminating redundancy and driving cost savings through the integration of the silos was really, really important. And that's a process and the people think every bit, as much as it is a systems and a data thing so another big driver. And the fourth one, you know, we've talked a little bit about some of these things, right? 5G brings huge opportunity for enterprise services innovation. So industry 4.0, digital experience, these kinds of use cases were very important in the South Korean market and in the business of LG Uplus And so looking at AI and how can you apply AI to network management? Again, there's a number of use cases, really, really exciting use cases that have gone live now in LG Uplus since we did this initial deployment and they're making fantastic strides there. Big data analytics for users across LG Uplus, right? So it's not just for, it's not just for the immediate application of 5G or the support or the 5G network, but also for other data analysts and data scientists across the LG Uplus business. Network analytics while primarily it's, it's primary use case is around network management. LG Uplus or network analytics has applications across the entire business, right? So, you know, for customer churn or next best offer for understanding customer experience and customer behavior really important there for digital advertising, for product innovation, all sorts of different use cases and departments within the business needed access to this information. So collaboration sharing across the network, the real-time network analytics platform it was very important. And then finally, as I mentioned, LG group is much bigger than just LG Uplus. It's got the electronics and other pieces, and they had launched a major group wide digital transformation program in 2019. And so being a part of that was important as well. Some of the seems that they were looking to address. So first of all, the integration of wired and wireless data sources, and so getting your assurance data sources, your network data sources and so on integration was really, really important. Scale was massive for them. You know, they're talking about billions of transactions in under a minute being processed and hundreds of terabytes per day. So, you know, phenomenal scale that needed to be, you know, available out of the box as it were. Real time indicators and alarms. And there was lots of KPIs and thresholds set that, you know, to make, made to meet certain criteria, certain standards. Customer specific real time analysis of 5G, services particularly for the launch, root cause analysis and AI based prediction on service anomalies and service issues was a core use case. As I talked about already the provision of service, of data services across the organization. And then support for 5G, served the business service impact was extremely important. So it's not just understand, well, you know, that you have an outreach in a particular network element, but what is the impact on the business of LG Uplus, but also what is the impact on the business of the customer from an outage or an anomaly or a problem on the network. So being able to answer those kinds of questions really, really important too. And as I said between Cloudera and Caremark and LG Uplus they have already, themselves an intrinsic part of the solution, this is what we ended up building. So a big, complicated architecture side. I really don't want to go into too much detail here. You can see these things for yourself, but let me skip through it really quickly. So, first of all, the key data sources. You have all of your wireless network information, other data sources, this is really important 'cause sometimes you kind of skip over this. There are other systems that are in place like the enterprise data warehouse that needed to be integrated as well. Southbound and northbound interfaces. So we get our data, yo know, from the network and so on and network management applications through both file interfaces, Kafka, NiFi are important technologies. And also the RDBMS systems that, you know, like the enterprise data warehouse that we're able to feed that into the system. And then northbound, you know, we spoke already about making network analytics services available across the enterprise. So, you know, having both a file and API interface available for other systems and other consumers across the enterprise is very important. Lots of stuff going on then in the platform itself. Two petabytes and persistent storage, Cloudera HDFS, 300 nodes for the raw data storage and then Kudu for real time storage for, you know, real-time indicator analysis around generation and other real time processes. So there was the core of the solution spark processes for ETL, key quality indicators and alarming, and also a bunch of work done around data preparation, data generation for transferal to, for party systems through the northbound interfaces. Impala API queries for real-time systems there on the right hand side and then a whole bunch of clustering classification, prediction jobs through the ML processes, the machine learning processes. Again, another key use case, and we've done a bunch of work on that, and I encourage you to have a look at the Cloudera website for more detail on some of the work that we did here. Some pretty cool stuff. And then finally, just the upstream services, some of these, there's lots more than simply these ones, but service assurance is really, really important so SQM, CEM and ACD right to the service quality management customer experience autonomous control is really, really important consumers of the real-time analytics platform and your conventional service assurance functions like faulted performance management. These things are as much consumers of the information and the network analytics platform as they are providers of data to the network analytics platform. So some of the specific use cases that have been stood up and that are delivering value to this day and there's lots of more besides, but these are just three that we pulled out. So, first of all, sort of specific monitoring and customer quality analysis care and response. So again, growing from the initial 5G launch, and then broadening into broader services, understanding where there are issues so that when people complain, when people have an issue that we can answer the concerns of the client in a substantive way. AI functions around root cause analysis understanding why things went wrong when they went wrong and also making recommendations as to how to avoid those occurrences in the future. So, you know, what preventative measures can be taken. And then finally, the collaboration function across LG Uplus extremely important and continues to be important to this day where data is shared throughout the enterprise, through the API Lira, through file interfaces and other things and through interface integrations with upstream systems. So that's kind of the real quick run through of LG Uplus. And the numbers are just staggering. You know, we've seen upwards of a billion transactions in under 40 seconds being tested. And we've gone through beyond those thresholds now already, and we're start, and this isn't just a theoretical sort of a benchmarking test or something like that. We're seeing these kinds of volumes of data and not too far down the track. So with those things that I mentioned earlier or with the proliferation of network infrastructure in the 5G context with virtualized elements, with all of these other bits and pieces are driving massive volumes of data towards the network analytics platform. So phenomenal scale. This is just one example. We work with service providers all over the world is over 80% of the top 100 telecommunication service providers run on Cloudera. They use Cloudera in the network and we're seeing those customers all migrating Legacy Cloudera platforms now onto CDP onto the Cloudera Data Platform. They're increasing the jobs that they do. So it's not just warehousing, not just ingestion of ETL and moving into things like machine learning. And also looking at new data sources from places like NW DAF the network data analytics function in 5G or the management and orchestration layer in software defined network function virtualization. So, you know, new use cases coming in all the time, new data sources coming in all the time, growth in the application scope from, as we say, from edge to AI. And so it's really exciting to see how the footprint is growing and how the applications in telecommunications are really making a difference in facilitating network transformation. And that's covering, that's me covered for today. I hope you found that helpful. By all means please reach out. There's a couple of links here. You can follow me on Twitter. You can connect to the telecommunications page. Reach out to me directly at Cloudera I'd love to answer your questions and talk to you about how big data is transforming networks and how network transformation is accelerating telcos throughout the world.

>>Hi today, I'm going to talk about network analytics and what that means for, for telecommunications as we go forward. Um, thinking about, uh, 5g, what the impact that's likely to have on, on network analytics and the data requirement, not just to run the network and to understand the network a little bit better. Um, but also to, to inform the rest of the operation of the telecommunications business. Um, so as we think about where we are in terms of network analytics and what that is over the last 20 years, the telecommunications industry has evolved its management infrastructure, uh, to abstract away from some of the specific technologies in the network. So what do we mean by that? Well, uh, in the, in the initial, uh, telecommunications networks were designed, there were management systems that were built in, um, eventually fault management systems, uh, assurance systems, provisioning systems, and so on were abstracted away. >>So it didn't matter what network technology had, whether it was a Nokia technology or Erickson technology or Huawei technology or whatever it happened to be. You could just look at your fault management system, understand where false, what happened as we got into the last sort of 10, 15 years or so. Telecommunication service providers become became more sophisticated in terms of their approach to data analytics and specifically network analytics, and started asking questions about why and what if in relation to their network performance and network behavior. And so network analytics as a, as a bit of an independent function was born and over time, more and more data began to get loaded into the network analytics function. So today just about every carrier in the world has a network analytics function that deals with vast quantities of data in big data environments that are now being migrated to the cloud. >>As all telecommunications carriers are migrating as many it workloads as possible, um, to the cloud. So what are the things that are happening as we migrate to the cloud that drive, uh, uh, enhancements in use cases and enhancements and scale, uh, in telecommunications network analytics? Well, 5g is the big thing, right? So 5g, uh, it's not just another G in that sense. I mean, in some cases, in some senses, it is 5g means greater bandwidth, lower latency and all those good things. So, you know, we can watch YouTube videos with less interference and, and less sluggish bandwidth and so on and so forth. But 5g is really about the enterprise and enterprise services. Transformation, 5g is more secure, kind of a network, but 5g is also a more pervasive network 5g, a fundamentally different network topology than previous generations. So there's going to be more masts and that means that you can have more pervasive connectivity. >>Uh, so things like IOT and edge applications, autonomous cars, smart cities, these kinds of things, um, are all much better served because you've got more masks that of course means that you're going to have a lot more data as well. And we'll get to that. The second piece is immersive digital services. So with more masks, with more connectivity, with lower latency with higher man, the potential, uh, is, is, is, is immense for services innovation. And we don't know what those services are going to be. We know that technologies like augmented reality, virtual reality, things like this have great potential. Um, but we, we have yet to see where those commercial applications are going to be, but the innovation and the innovation potential for 5g is phenomenal. Um, it certainly means that we're going to have a lot more, uh, edge devices, um, uh, and that again is going to lead to an increase in the amount of data that we have available. >>And then the idea of pervasive connectivity when it comes to smart, smart cities, uh, autonomous, autonomous currents, um, uh, integrated traffic management systems, um, all of this kind of stuff, those of those kind of smart environments thrive where you've got this kind of pervasive connectivity, this persistent, uh, connection to the network. Um, again, that's going to drive, um, um, uh, more innovation. And again, because you've got these new connected devices, you're going to get even more data. So this rise, this exponential rise in data is really what's driving the change in, in network analytics. And there are four major vectors that are driving this increase in data in terms of both volume and in terms of speed. So the first is more physical elements. So we said already that 5g networks are going to have a different apology. 5g networks will have more devices, more and more masks. >>Um, and so with more physical elements in the network, you're going to get more physical data coming off those physical networks. And so that needs to be aggregated and collected and managed and stored and analyzed and understood when, so that we can, um, have a better understanding as to why things happened the way they do, why the network behaves in which they do in, in, in, in ways that it does and why devices that are connected to the network. And ultimately of course, consumers, whether they be enterprises or retail customers, um, behave in the way they do in relation to their interaction within our edge nodes and devices, we're going to have a, uh, an explosion in terms of the number of devices. We've already seen IOT devices with your different kinds of trackers and, uh, and, and sensors that are hanging off the edge of the network, whether it's to make buildings smarter car smarter, or people smarter, um, in, in terms of having the, the, the measurements and the connectivity and all that sort of stuff. >>So the numbers of devices on the agent beyond the age, um, are going to be phenomenal. One of the things that we've been trying to with as an industry over the last few years is where does the telco network end, and where does the enterprise, or even the consumer network begin. You used to be very clear that, you know, the telco network ended at the router. Um, but now it's not, it's not that clear anymore because in the enterprise space, particularly with virtualized networking, which we're going to talk about in a second, um, you start to see end to end network services being deployed. Um, uh, and so are they being those services in some instances are being managed by the service provider themselves, and in some cases by the enterprise client, um, again, the line between where the telco network ends and where the enterprise or the consumer network begins, uh, is not clear. >>Uh, so, so those edge, the, the, the proliferation of devices at the age, um, uh, in terms of, um, you know, what those devices are, what the data yield is and what the policies are, their need to govern those devices, um, in terms of security and privacy, things like that, um, that's all going to be really, really important virtualized services. We just touched on that briefly. One of the big, big trends that's happening right now is not just the shift of it operations onto the cloud, but the shift of the network onto the cloud, the virtualization of network infrastructure, and that has two major impacts. First of all, it means that you've got the agility and all of the scale, um, uh, benefits that you get from migrating workloads to the cloud, the elasticity and the growth and all that sort of stuff. But arguably more importantly for the telco, it means that with a virtualized network infrastructure, you can offer entire networks to enterprise clients. >>So if you're selling to a government department, for example, is looking to stand up a system for certification of, of, you know, export certification, something like that. Um, you can not just sell them the connectivity, but you can sell them the networking and the infrastructure in order to serve that entire end to end application. You could sentence, you could offer them in theory, an entire end-to-end communications network, um, and with 5g network slicing, they can even have their own little piece of the 5g bandwidth that's been allocated against the carrier, um, uh, and, and have a complete end to end environment. So the kinds of services that can be offered by telcos, um, given virtualize network infrastructure, uh, are, are many and varied. And it's a, it's a, it's a, um, uh, an outstanding opportunity. But what it also means is that the number of network elements virtualized in this case is also exploding. >>That means the amount of data that we're getting on, uh, informing us as to how those network elements are behaving, how they're performing, um, uh, is, is, is going to go up as well. And then finally, AI complexity. So on the demand side, um, while historically, uh, um, network analytics, big data, uh, has been, has been driven by, um, returns in terms of data monetization, uh, whether that's through cost avoidance, um, or service assurance, uh, or even revenue generation through data monetization and things like that. AI is transforming telecommunications and every other industry, the potential for autonomous operations, uh, is extremely attractive. And so understanding how the end-to-end telecommunication service delivering delivery infrastructure works, uh, is essential, uh, as a training ground for AI models that can help to automate a huge amount of telecommunications operating, um, processes. So the AI demand for data is just going through the roof. >>And so all of these things combined to mean big data is getting explosive. It is absolutely going through the roof. So that's a huge thing that's happening. So as telecommunications companies around the world are looking at their network analytics infrastructure, which was initially designed for service insurance primarily, um, and how they migrate that to the cloud. These things are impacting on those decisions because you're not just looking at migrating a workload to operate in the cloud that used to work in the, in the data center. Now you're looking at, um, uh, migrating a workload, but also expanding the use cases in that work and bear in mind, many of those, those are going to need to remain on prem. So they'll need to be within a private cloud or at best a hybrid cloud environment in order to satisfy a regulatory jurisdictional requirements. So let's talk about an example. >>So LGU plus is a Finastra fantastic service provider in Korea. Um, huge growth in that business over the last, uh, over the last 10, 15 years or so. Um, and obviously most people will be familiar with LG, the electronics brand, maybe less so with, uh, with LG plus, but they've been doing phenomenal work. And we're the first, uh, business in the world who launch commercial 5g in 2019. And so a huge milestone that they achieved. And at the same time they deploy the network real-time analytics platform or in rep, uh, from a combination of Cloudera and our partner calmer. Now, um, there were a number of things that were driving, uh, the requirement for it, for the, for the analytics platform at the time. Um, clearly the 5g launch was that was the big thing that they had in mind, but there were other things that re so within the 5g launch, um, uh, they were looking for, for visibility of services, um, and service assurance and service quality. >>So, you know, what services have been launched? How are they being taken up? What are the issues that are arising, where are the faults happening? Um, where are the problems? Because clearly when you launch a new service, but then you want to understand and be on top of the issues as they arise. Um, so that was really, really important. The second piece was, and, you know, this is not a new story to any telco in the world, right. But there are silos in operation. Uh, and so, um, taking advantage of, um, or eliminating redundancies through the process, um, of, of digital transformation, it was really important. And so particular, the two silos between wired and the wireless sides of the business come together so that there would be an integrated network management system, um, for, uh, for LGU plus, as they rolled out 5g. So eliminating redundancy and driving cost savings through the, the integration of the silos is really, really important. >>And that's a process and the people thing every bit, as much as it is a systems and a data thing. So, um, another big driver and the fourth one, you know, we've talked a little bit about some of these things, right? 5g brings huge opportunity for enterprise services, innovation. So industry 4.0 digital experience, these kinds of use cases, um, are very important in the south Korean marketing and in the, um, in the business of LGU plus. And so, uh, um, looking at AI and how can you apply AI to network management? Uh, again, there's a number of use cases, really, really exciting use cases that have gone live now, um, in LG plus since, uh, since we did this initial deployment and they're making fantastic strides there, um, big data analytics for users across LGU plus, right? So it's not just for, um, uh, it's not just for the immediate application of 5g or the support or the 5g network. >>Um, but also for other data analysts and data scientists across the LGU plus business network analytics, while primarily it's primary it's primary use case is around network management, um, LGU plus, or, or network analytics, um, has applications across the entire business, right? So, um, you know, for customer churn or next best offer for understanding customer experience and customer behavior really important there for digital advertising, for product innovation, all sorts of different use cases and departments within the business needed access to this information. So collaboration sharing across the network, the real-time network analytics platform, um, it was very important. And then finally, as I mentioned, LG group is much bigger than just LG plus it's because the electronics and other pieces, and they had launched a major group wide digital transformation program in 2019, and still being a part of that was, well, some of them, the problems that they were looking to address. >>Um, so first of all, the integration of wired and wireless data service data sources, and so getting your assurance data sources, your network, data sources, uh, and so on integrated with is really, really important scale was massive for them. Um, you know, they're talking about billions of transactions in under a minute, uh, being processed, um, and hundreds of terabytes per day. So, uh, you know, phenomenal scale, uh, that needed to be available out of the box as it were, um, real time indicators and alarms. And there was lots of KPIs and thresholds set that, you know, w to make, make it to meet certain criteria, certain standards, um, customer specific, real time analysis of 5g, particularly for the launch root cause analysis, an AI based prediction on service, uh, anomalies and service service issues was, was, was a core use case. Um, as I talked about already the provision of service of data services across the organization, and then support for 5g, uh, served the business service, uh, impact, uh, was extremely important. >>So it's not just understand well, you know, that you have an outage in a particular network element, but what is the impact on the business of LGU plus, but also what is the impact on the business of the customer, uh, from an outage or an anomaly or a problem on, on, on the network. So being able to answer those kinds of questions really, really important, too. And as I said, between Cloudera and Kamarck, uh, uh, and LGU plus, uh, really themselves an intrinsic part of the solution, um, uh, this is, this is what we, we ended up building. So a big complicated architecture space. I really don't want to go into too much detail here. Um, uh, you can see these things for yourself, but let me skip through it really quickly. So, first of all, the key data sources, um, you have all of your wireless network information, other data sources. >>This is really important because sometimes you kind of skip over this. There are other systems that are in place like the enterprise data warehouse that needed to be integrated as well, southbound and northbound interfaces. So we get our data from the network and so on, um, and network management applications through file interfaces. CAFCA no fire important technologies. And also the RDBMS systems that, uh, you know, like the enterprise data warehouse that we're able to feed that into the system. And then northbound, um, you know, we spoke already about me making network analytics services available across the enterprise. Um, so, uh, you know, uh, having both the file and the API interface available, um, for other systems and other consumers across the enterprise is very important. Um, lots of stuff going on then in the platform itself to petabytes and persistent storage, um, Cloudera HDFS, 300 nodes for the, the raw data storage, um, uh, and then, uh, could do for real time storage for real-time indicator analysis, alarm generation, um, uh, and other real time, um, processes. >>Uh, so there, that was the, the core of the solution, uh, spark processes for ETL key quality indicators and alarming, um, and also a bunch of work done around, um, data preparation, data generation for transferal to, to third party systems, um, through the northbound interfaces, um, uh, Impala, API queries, um, for real-time systems, uh, there on the right hand side, and then, um, a whole bunch of clustering classification, prediction jobs, um, through the, uh, the, the, the, the ML processes, the machine learning processes, uh, again, another key use case, and we've done a bunch of work on that. And, um, I encourage you to have a look at the Cloudera website for more detail on some of the work that we did here. Um, so this is some pretty cool stuff. Um, and then finally, just the upstream services, some of these there's lots more than, than, than simply these ones, but service assurance is really, really important. So SQM cm and SED grade. So the service quality management customer experience, autonomous controllers, uh, really, really important consumers of, of the, of the real-time analytics platform, uh, and your conventional service assurance, um, functions like faulted performance management. Uh, these things are as much consumers of the information and the network analytics platform as they are providers of data to the network, uh, analytics >>Platform. >>Um, so some of the specific use cases, uh, that, uh, have been, have been stood up and that are delivering value to this day and lots of more episodes, but these are just three that we pulled out. Um, so first of all, um, uh, sort of specific monitoring and customer quality analysis, Karen response. So again, growing from the initial 5g launch and then broadening into broader services, um, understanding where there are the, where there are issues so that when people complaining, when people have an issue, um, that, um, uh, that we can answer the, the concerns of the client, um, in a substantive way, um, uh, AI functions around root cause analysis or understanding why things went wrong when they went wrong. Um, uh, and also making recommendations as to how to avoid those occurrences in the future. Uh, so we know what preventative measures can be taken. Um, and then finally the, uh, the collaboration function across LGU plus extremely important and continues to be important to this day where data is shared throughout the enterprise, through the API Lira through file interfaces and other things, and through interface integrations with, uh, with upstream systems. >>So, um, that's kind of the, the, uh, real quick run through of LGU plus the numbers are just stave staggering. Um, you know, we've seen, uh, upwards of a billion transactions in under 40 seconds being, um, uh, being tested. Um, and, and we've gone beyond those thresholds now, already, um, and we're started and, and, and, and this isn't just a theoretical sort of a benchmarking test or something like that. We're seeing these kinds of volumes of data and not too far down the track. So, um, with those things that I mentioned earlier with the proliferation of, of, um, of network infrastructure, uh, in the 5g context with virtualized elements, with all of these other bits and pieces are driving massive volumes of data towards the, uh, the, the, the network analytics platform. So phenomenal scale. Um, this is just one example we work with, with service providers all over the world is over 80% of the top 100 telecommunication service providers run on Cloudera. >>They use Cloudera in the network, and we're seeing those customers, all migrating legacy cloud platforms now onto CDP onto the Cloudera data platform. Um, they're increasing the, the, the jobs that they do. So it's not just warehousing, not just ingestion ETL, and moving into things like machine learning. Um, and also looking at new data sources from places like NWTF the network data analytics function in 5g, or the management and orchestration layer in, in software defined networks, network, function, virtualization. So, you know, new use cases coming in all the time, new data sources coming in all the time growth in, in, in, in the application scope from, as we say, from edge to AI. Um, and so it's, it's really exciting to see how the, the, the, the footprint is growing and how, uh, the applications in telecommunications are really making a difference in, in facilitating, um, network transformation. And that's covering that. That's me covered for today. I hope you found that helpful, um, by all means, please reach out, uh, there's a couple of links here. You can follow me on Twitter. You can connect to the telecommunications page, reach out to me directly at Cloudera. I'd love to answer your questions, um, uh, and, uh, and talk to you about how big data is transforming networks, uh, and how network transformation is, is accelerating telcos, uh, throughout >>Jamie Sharath with Liga data, I'm primarily on the delivery side of the house, but I also support our new business teams. I'd like to spend a minute really just kind of telling you about the legal data, where basically a Silicon valley startup, uh, started in 2014, and, uh, our lead iron, our executive team, basically where the data officers at Yahoo before this, uh, we provide managed data services, and we provide products that are focused on telcos. So we have some experience in non telco industry, but our focus for the last seven years or so is specifically on telco. So again, something over 200 employees, we have a global presence in north America, middle east Africa, Asia, and Europe. And we have folks in all of those places, uh, I'd like to call your attention to the, uh, the middle really of the screen there. So here is where we have done some partnership with Cloudera. >>So if you look at that and you can see we're in Holland and Jamaica, and then a lot to throughout Africa as well. Now, the data fabric is the product that we're talking about. And the data fabric is basically a big data type of data warehouse with a lot of additional functionality involved. The data fabric is comprised of, uh, some something called a flare, which we'll talk about in a minute below there, and then the Cloudera data platform underneath. So this is how we're partnering together. We, uh, we, we have this tool and it's, uh, it's functioning and delivering in something over 10 up. So flare now, flare is a piece of that legal data IP. The rest is there. And what flare does is that basically pulls in data, integrates it to an event streaming platform. It's, uh, it is the engine behind the data fabric. >>Uh, it's also a decisioning platform. So in real time, we're able to pull in data. We're able to run analytics on it, and we're able to alert are, do whatever is needed in a real-time basis. Of course, a lot of clients at this point are still sending data in batch. So it handles that as well, but we call that a CA picture Sanchez. Now Sacho is a very interesting app. It's an AI analytics app for executives. What it is is it runs on your mobile phone. It ties into your data. Now this could be the data fabric, but it couldn't be a standalone product. And basically it allows you to ask, you know, human type questions to say, how are my gross ads last week? How are they comparing against same time last week before that? And even the same time 60 days ago. So as an executive or as an analyst, I can pull it up and I can look at it instantly in a meeting or anywhere else without having to think about queries or anything like that. >>So that's pretty much for us at legal data, not really to set the context of where we are. So this is a traditional telco environments. So you see the systems of record, you see the cloud, you see OSS and BSS data. So one of the things that the next step above which calls we call the system of intelligence of the data fabric does, is it mergers that BSS and OSS data. So the longer we have any silos or anything that's separated, it's all coming into one area to allow business, to go in or allow data scientists go in and do that. So if you look at the bottom line, excuse me, of the, uh, of the system of intelligence, you can see that flare is the tools that pulls in the data. So it provides even streaming capabilities. It preserves entity states, so that you can go back and look at it state at any time. >>It does stream analytics that is as the data is coming in, it can perform analytics on it. And it also allows real-time decisioning. So that's something that, uh, that's something that business users can go in and create a system of, uh, if them's, it looks very much like the graph database, where you can create a product that will allow the user to be notified if a certain condition happens. So for instance, a bundle, so a real-time offer or user is succinct to run out of is ongoing, and an offer can be sent to him right on the fly. And that's set up by the business user as opposed to programmers, uh, data infrastructure. So the fabric has really three areas. That data is persistent, obviously there's the data lake. So the data lake stores that level of granularity that is very deep years and years of history, data, scientists like that, uh, and, uh, you know, for a historical record keeping and requirements from the government, that data would be stored there. >>Then there's also something we call the business semantics layer and the business semantics layer contains something over 650 specific telco KPIs. These are initially from PM forum, but they also are included in, uh, various, uh, uh, mobile operators that we've delivered at. And we've, we've grown that. So that's there for business data lake is there for data scientists, analytical stores, uh, they can be used for many different reasons. There are a lot of times RDBMS is, are still there. So these, this, this basically platform, this cloud they're a platform can tie into analytical data stores as well via flair access and reporting. So graphic visualizations, API APIs are a very key part of it. A third-party query tools, any kind of grid tools can be used. And those are the, of course, the, uh, the ones that are highly optimized and allow, you know, search of billions of records. >>And then if you look at the top, it's the systems of engagement, then you might vote this use cases. So teleco reporting, hundreds of KPIs that are, that are generated for users, segmentation, basically micro to macro segmentation, segmentation will play a key role in a use case. We talked about in a minute monetization. So this helps teleco providers monetize their specific data, but monetize it in. Okay, how to, how do they make money off of it, but also how might you leverage this data to engage with another client? So for instance, in some where it's allowed a DPI is used, and the fabric tracks exactly where each person goes each, uh, we call it a subscriber, goes within his, uh, um, uh, internet browsing on the, on the four or 5g. And, uh, the, all that data is stored. Uh, whereas you can tell a lot of things where the segment, the profile that's being used and, you know, what are they propensity to buy? Do they spend a lot of time on the Coca-Cola page? There are buyers out there that find that information very valuable, and then there's signs of, and we spoke briefly about Sanchez before that sits on top of the fabric or it's it's alone. >>So, so the story really that we want to tell is, is one, this is, this is one case out of it. This is a CVM type of case. So there was a mobile operator out there that was really offering, you know, packages, whether it's a bundle or whether it's a particular tool to subscribers, they, they were offering kind of an abroad approach that it was not very focused. It was not depending on the segments that were created around the profiling earlier, uh, the subscriber usage was somewhat dated and this was causing a lot of those. A lot of those offers to be just basically not taken and, and not, not, uh, audited. Uh, there was limited segmentation capabilities really before the, uh, before the, uh, fabric came in. Now, one of the key things about the fabric is when you start building segments, you can build that history. >>So all of that data stored in the data lake can be used in terms of segmentation. So what did we do about that? The, the, the envy and, oh, the challenge this, uh, we basically put the data fabric in and the data fabric was running Cloudera data platform and that, uh, and that's how we team up. Uh, we facilitated the ability to personalize campaign. So what that means is, uh, the segments that were built and that user fell within that segment, we knew exactly what his behavior most likely was. So those recommendations, those offers could be created then, and we enable this in real time. So real-time ability to even go out to the CRM system and gather further information about that. All of these tools, again, we're running on top of the Cloudera data platform, uh, what was the outcome? Willie, uh, outcome was that there was a much more precise offer given to the client that is, that was accepted, no increase in cross sell and upsell subscriber retention. >>Uh, our clients came back to us and pointed out that, uh, it was 183% year on year revenue increase. Uh, so this is a, this is probably one of the key use cases. Now, one thing to really mention is there are hundreds and hundreds of use cases running on the fabric. And I would even say thousands. A lot of those have been migrated. So when the fabric is deployed, when they bring the Cloudera and the legal data solution in there's generally a legacy system that has many use cases. So many of those were, were migrated virtually all of them in pen, on put on the cloud. Uh, another issue is that new use cases are enabled again. So when you get this level of granularity and when you have campaigns that can now base their offers on years of history, as opposed to 30 days of history, the campaigns campaign management response systems, uh, are, are, uh, are enabled quite a bit to do all, uh, to be precise in their offers. Okay. >>Okay. So this is a technical slide. Uh, one of the things that we normally do when we're, when we're out there talking to folks, is we talk and give an overview and that last little while, and then we give a deep technical dive on all aspects of it. So sometimes that deep dive can go a couple of hours. I'm going to do this slide and a couple of minutes. So if you look at it, you can see over on the left, this is the, uh, the sources of the data. And they go through this tool called flare that runs on the cloud. They're a data platform, uh, that can either be via cues or real-time cues, or it can be via a landing zone, or it can be a data extraction. You can take a look at the data quality that's there. So those are built in one of the things that flare does is it has out of the box ability to ingest data sources and to apply the data quality and validation for telco type sources. >>But one of the reasons this is fast to market is because throughout those 10 or 12, uh, opcos that we've done with Cloudera, where we have already built models, so models for CCN, for air for, for most mediation systems. So there's not going to be a type of, uh, input that we haven't already seen are very rarely. So that actually speeds up deployment very quickly. Then a player does the transformations, the, uh, the metrics, continuous learning, we call it continuous decisioning, uh, API access. Uh, we, uh, you know, for, for faster response, we use distributed cash. I'm not going to go too deeply in there, but the layer in the business semantics layer again, are, are sitting on top of the Cloudera data platform. You see the Kafka CLU, uh, Q1, the right as well. >>And all of that, we're calling the fabric. So the fabric is Cloudera data platform and the cloud and flair and all of this runs together. And, and by the way, there've been many, many, many, many hundreds of hours testing flare with Cloudera and, uh, and the whole process, the results, what are the results? Well, uh, there are, there are four I'm going to talk about, uh, we saw the one for the, it was called my pocket pocket, but it's a CDM type, a use case. Uh, the subscribers of that mobile operator were 14 million plus there was a use case for 24 million plus that a year on year revenue was 130%, uh, 32 million plus for 38%. These are, um, these are different CVM pipe, uh, use cases, as well as network use cases. And then there were 44%, uh, telco with 76 million subscribers. So I think that there are a lot more use cases that we could talk about, but, but in this case, this is the ones we're looking at, uh, again, 183%. This is something that we find consistently. And these figures come from our, uh, our actual end client. How do we unlock the full potential of this? Well, I think to start is to arrange a meeting and, uh, it would be great to, to, uh, for you to reach out to me or to Anthony. Uh, we're working at the junction on this, and we can set up a, uh, we can set up a meeting and we can go through this initial meeting. And, uh, I think that's the very beginning. Uh, again, you can get additional information from Cloudera website and from the league of data website, Anthony, that's the story. Thank you. >>No, that's great. Jeremy, thank you so much. It's a, it's, it's wonderful to go deep. And I know that there are hundreds of use cases being deployed in MTN, um, but great to go deep on one. And like you said, it can, once you get that sort of architecture in place, you can do so many different things. The power of data is tremendous, but it's great to be able to see how you can, how you can track it end to end from collecting the data, processing it, understanding it, and then applying it in a commercial context and bringing actual revenue back into the business. So there is your ROI straight away. Now you've got a platform that you can transform your business on. That's, that's, it's a tremendous story, Jamie, and thank you for your part. Sure. Um, that's a, that's, that's our story for today. Like Jamie says, um, please do flee, uh, feel free to reach out to us. Um, the, the website addresses are there and our contact details, and we'd be delighted to talk to you a little bit more about some of the other use cases, perhaps, um, and maybe about your own business and, uh, and how we might be able to make it, make it perform a little better. So thank you.

>> Okay. We're back here. theCube and all the action here in Mobile World Congress, cloud city, I'm John ferry, host of the cube. We've got a great remote interviews. Of course, it's a hybrid event here in the cube. And of course, cloud city's bringing all the physical face-to-face and we're going to get the remote interviews. Peter Adderton, founder, chairman, CEO of Mobile X Global. Nicholas Gerrard, founder and CEO of OxyGo. Gentlemen, thank you for coming in remotely onto the cube here in the middle of cloud city. You missed Bon Jovi last night, he was awesome. The little acoustic unplugged and all the action. Thanks for coming on. >> Yeah, thanks for having us. >> All right, Peter and Nicholas, if you don't mind, just take a quick 30 seconds to set the table on what you guys do, your business and your focus here at Mobile World Congress. >> So I'll jump in quickly. Being the Australian, I'll go first, but just quick by way of background, I founded a company called Boost Mobile, which is one of the, is now the fourth largest mobile brand in, in America. And I spent a lot of time managing effort in that, in that space and now launching Mobile X, which is kind of the first cloud AI platform that we're going to build for mobile. >> Awesome. Nicholas. >> So I'm a founder of a company called, Ox Fuel where we do is basically a telecommunity service platform for brands to basically incorporate telecom as part of their services and learn from their customers through what we call a telecom business intelligence. So basically making sense of the telecom data to improve their business across retail, financial services or in-demand economy. >> Awesome. Well, thanks for the setup. Peter, I want to ask you first, if you don't mind, the business models in the telecom area is really becoming, not just operate, but build and build new software enabled software defined just cloud-based software. And this has been a change in mindset, not so much a change so much in the actual topologies per se, or the actual investments, but as a change in personnel. What's your take on this whole cloud powering the change in the future of telco? >> Well, I think you've got to look at where the telcos have come from in order to understand where they're going in the future. And where they've come from is basically using other people's technology to try to create a differentiation. And I think that that's the struggle that they're going to have. They talk about wanting to convert themselves from telcos into techcos. I just think it's a leap too far for the carriers to do that. So I think we're going to see, you know, them pushing 5G, which you see they're doing out there right now. Then they start talking about open rand and cloud and, and at the end of the day, all they want to do is basically sell you a plan, give you a phone attached to that and try to make as much money out of you as they possibly can. And they disguise that basically in the whole technology 5G open rand discussion, but they really, I don't think care. And at the end of the day, I don't think the consumers care, their model isn't built around technology. The model is built around selling your data and, and that's their fundamental principle and how they do that. And I've seen them go through from 2G, 3G, 4G, 5G. Every G we see come out has a promise of something new and incredible. But what we basically get is a data plan with the minutes. Right? >> Yeah, yeah I totally right on. And I think we're going to get into the whole edge piece of what that's going to open up when you start thinking about what, what the capabilities are and this new stakeholders who are going to have an interest in the trillions of dollars on the table right now, up for grabs. But Nicholas wanted to get to you on this whole digital-first thing, because one of the things we've been saying on theCube and interviewing folks and riffing on is: If digital drives more value and there's new use cases that are going to bring on, that's going to enabled by software. There's now new stakeholders coming and saying, Hey, you know what? I need more than just a pipe. I need more than just the network. I need to actually run healthcare. I need to run education on the edge. These are now industrial and consumer related use cases. I mean, this is software. This is where software and apps shine. So cloud native can enable that. So what's your take on the industry as they start to wake up and say, holy shit, this is going to be pretty massive when you look at what's coming. Not so much what's going to be replatformed, but what's coming. >> Yeah, no, I think it's a, it's where I kind join Peter on this. There's been pretty significant, heavy innovation on the carrier side for, you know, if you think about it 30 years or so of like just reselling plans effectively, which is a virtual slice of the network that built. And all of a sudden they started competing against, you know, the heavyweights on the internet. We had, putting the bar really high in terms of, you know, latency in terms of expectation, in terms of APIs, right? We've we've heard about telecom APIs for 15 years, right? It's- nothing comes close to what you could get if you start building on top of a Stripe or a Google. So I think, it's going to be hard for a lot of those companies. What we do with our show is we try to bridge that gap. Right, we try to build on top of their infrastructure to be able to expose modern APIs, to be able to open up a programmatic interface so that innovators like Peter's are able to actually really take the user experience forward and start, building those specialized businesses across healthcare, financial services, and whatnot. >> Yeah, David Blanca and I were on the, on theCube yesterday talking about how Snowflake, a company that basically sits on top of Amazon built almost nothing on the infrastructure. Built on top of it and was successful. Peter, this is a growth thing. One of the things I want to get your thoughts on is you've had experiences in growing companies. How do you look at the growth coming into this market, Peter, because you know, you got to have new opportunities coming in. It's a growth play too. It's not just take share from someone. It's net new capabilities. >> Yeah. Here's the issue you've got with the wireless industry is that there's only a very few amount of them that actually have that last mile covered. So if you're going to build something on top of it, you're going to have to deal with the carrier, and the carrier as out of like a duopoly slash monopoly, because without their access to their network, you're not going to be able to do these incredible things. So I think we've got a real challenge there where you're going to have to get the carriers to innovate. Now you've got the CEO of Deutsche Telekom coming out yesterday saying that the OTT players aren't paying their fair share. Right, and I sit back and go, well, hang on. You're selling data to customers who basically are using that data to use apps and OTT. And now he's saying, well, they should pay as well. So not only the consumer pay, but now the OTT players should pay. It's a mixed message. So what you're going to have to do, and what we're going to have to do as a, as a growth industry is we're going to have to allow it to grow. And the only way to do that is that the carriers are going to have to have better access, allow more access to their networks, as Nico said, let the APIs has become more available. I just think that that's a leap too far. So I think we're going to be handicapped in our growth based on these carriers. And it's going to take regulators and it's going to take innovation and consumers demanding carriers, do it, otherwise, you know, you're still going to deal with the three carriers in your world. >> Yeah, That's interesting about- I was just talking to Danielle Royce, the DR here at TelcoDR. And she said, I was talking about ORAN and there's more infrastructure than needed. She said, oh, it's more software. I don't disagree with her. I do agree with it. But I also think that the ORAN points to, Nicholas, kind of this idea that there's more surface area to be had on the scale side. So standardizing hardware creates a lower fixed cost, so you can get some cost reduction. And then with standardized software, you get more enablement for hardened openness. I mean, open source is already proven. You can still be secure. And obviously Cloud was once said, could never be secure and most, is probably more secure than anything. What's your take on this whole ORAN commodity standardization mission- efforts? >> I think it's a, I mean, it goes along to the second phase, right? Of what the differentiation in telecom was, you know. Early on, specialized boxes that are very expensive. You know, that you, you, you, you get from a few vendors, then you have the transition over to a software. We lower the price, as you were mentioning. It can run on off the shelf hardware. And then we're in the transition, which is what Danielle is, is evangelizing, right. Transition towards the cloud and specifically the public cloud, because there's no such thing as a private cloud really. And, and so up and running is just another, another piece where you can make the Legos connect better effectively and just have more flexibility. And generally the, the, the game here is to also break the agenda when you- from, from the vendors, right? Because now you have a standard, so you don't necessarily need to buy the entire stack from, from the same vendors. You have a lot more flexibility. You know, you've probably followed the same debate that we've all seen, right. With a push against Huawei, for instance. Th-this is extremely hard for an operator, to start ripping out an entire vendor, because most of the time, they, they own the entire stack. But something like ORAN, now you can start mixing and matching with different vendors, but generally this is also a trend that's going to accelerate the move towards the public cloud. >> That's awesome. Peter, I want to get your thoughts because you're basically building on the cloud. And if you don't mind chime it in to kind of end the segment on this one point. People are trying to really get their minds around what refactoring means. And we've been saying, and talking about, you know, the three phases of, of waking up to the world. Reset your business, or reboot. Replatform to the cloud, and then refactor, which means take advantage of cloud enabled things, whether it's AI and other things. But first get on the platform, understand the economics, and then replatform. So the question, Peter, we'll start with you. What does refactoring actually mean and look like in a successful future execution or playbook? Can you share your thoughts, because this is what people want to get to because that's where the value will come from. That's where the iteration gets you. What's your take on this refactoring? >> Yeah, yeah. So I always, I mean, we're in the consumer business, so I'm always about what is the difference going to make for the consumer? So, whether you're, and when you look at refactoring and you look at what's happening in the space. Is what is the difference that's going to, what are the consumers going to see that's different and are they willing to pay for that? And so we can strip away the technical layers and we all get caught up in the industry with these buzzwords and terms, and we get, and at the end of the day, when it moves to the consumer, the consumer just sits there and says, so what's the value? How much am I paying? And so what we're trying to do at MobileX is, we're trying to use the cloud and we're trying to use kind of innovation into create a better experience for the consumer. One way to do that is to basically help the customer, understand their usage patents. You know, right now today, they don't understand that. Right if I asked you how much you paid for your mobile bill, you will tell me my cell phone bill is $150, but I'm going to ask you the next question How much data do you use? You go, I don't know, right? >> John: unlimited. >> And then I'd say why am I started- well you'd say limited, right. I will go. I'd go, I don't know. So I sit back and go, most customers are like you. You're basically paying for a service that you have no clear, no idea what you're getting. And it's designed by the carriers to scare you into thinking you need it. So I think we've got to get away from the buzzwords that we use as an industry and just dumb that down to what, what does that mean for a consumer? And I think that the cloud is going to allow us to create some very unique ways for consumers to interact with their device and their usage of that device. And I think that that's the holy grail for me. >> Yeah. That's a great point. And it's worth calling out because I think if the cloud can get you a 10X value at, at a reduction in costs compared to the competition, that's one benefit that people will pay for. And the other one is just, Hey, that's really cool. I want I'll, I value that, that's a valuable thing. I'll pay for it. So it's interesting that the cloud scale there, it's just a good mindset. >> Yeah. So it's always, I always like say to people, you know, I've spoken a lot to the Dish guys about what open rand is going to do and I keep saying to them, so what's the value that I'm going to get from a consumer. And they'll say, oh it's flexible pricing plans. They're now starting to talk about, okay, what the end product is of this technology. You look at ECM, right? ECM has been around for a long time. It's only now that we're to see ECM technology, get enabled. The carriers fought that for a long, long time. So there's a monumental shift that needs to take place. And it's in the four or five carriers in our counties. >> Awesome. Nicholas, what's your take on refactoring? Obviously, you know, you've got APIs, you've got all this cool software enabled. How do you get to refactoring and how do you execute through that? >> I mean, it's a little bit of a, what Peter was saying as well, right? There's the, the advantage of that point is to be, you know, all our stuff basically lives in the cloud, right. So it's opportunity to, to get that closer, you know, just having better latency, making sure that, you know, you're not losing your, your photos and your data as you lose your phone and yep. Just bet- better access in general. I, I think ultimately like the, the push to the cloud right now is it's mostly just a cost reduction. The back tick, as far as the carriers are concerned, right. They don't necessarily see how they can build that break. And then from there start interacting with the rest of the OTT world and, and, you know, Netflix is built on Amazon and companies like that, right? Like, so as you're able to get closer as a carrier to that cloud where the data lives, this is also just empowering better digital experience. >> Yeah I think that's where the that's, the proof point will be there, as they say, that's where the rubber will meet the road or proof is in the pudding, whatever expression. Once they get to that cost reduction, if they can wake up to that, whoa we can actually do something better here and make m- or if they don't someone else will. Right. That's the whole point. So, final question as we wrap up, ecosystem changeover. Lot more ecosystem action. I mean, there's a lot of vendors here at Mobile Congress, but real quick, Peter, Nicholas, your take on the future of ecosystem around this new telco. Peter, we'll start with you. >> Yeah, I look, I mean, it, it, again, it keeps coming back to, to, to where I say that consumers have driven all the ecosystems that have ever existed. And when I say consumers also to IOT as well, right? So it's not just the B to C it's also B to B. So look to the consumer and look to the business to see what pain points you can solve. And that will create the ecosystems. None of us bet on Uber, none of us bet on Airbnb. Otherwise we'd all be a lot richer than we are today. So none of us took that platform- and by the way, we've been in mobile and wireless and any kind of that space smartphone space for a long time. And we will miss those applications. And if you ask a CEO today of a telco, what's the 5G killer application, that's going to send 5G into the next atmosphere, they can't answer the question. They'll talk about drones and robotic surgeries and all things that basically will never have any value to a consumer at the end of the day. So I think we've got to go back to the consumer and that's where my focus is and say, how do we make their lives better? And that will create the ecosystem. >> Yeah, I mean, they go for the low hanging fruit. Low latency and, and whatnot. But yeah, let's, it's going to be, it's going to be, we'll see what happens. Nicolas your take on ecosystems as they develop. A lot more integrations and not customization. What's your thoughts? >> Yeah, I think so too. I mean, I think going back to, you know, again like 20- 20 years ago, the network was the product conductivity to the product. Today it's a, it's a building block, right? Something that you integrate that's part of your experience. So the same way we're seeing like conversions between telecom and financial services. Right? You see a lot of telcos trying to be banks. Banks and fintechs trying to be telcos. It's, it's a blending of that, right? So it, at the end of the day, it's like, why, what is the experience? What is the above and beyond the conductivity? Because customers, at this point, it's just not differentiated based on conductivity, kind of become just a busy commodity. So even as you look at what Peter is building, right, this, what is the experience above and beyond just buying a plan that I get out of it, or if you are a media company, you know, how do I pair my content or resolve real problems? Like for instance, we work a lot to the NBA and TikTok. They get into markets where, you know, having a video product at the end and people not being well-connected, that's a problem, right? So it's an opportunity for them to bring the building block into their ecosystem and start offering solutions that are a different shape. >> Awesome. Gentlemen, thank you so much. Both of you, both experienced entrepreneurs and executives riding the wave on the right side of history, I believe. Thanks for coming on theCube, I appreciate it. >> Thanks for having us. >> If you're not riding the wave the right way, you're driftwood. And we're going to toss it back to the studio. Adam and the team, take it from here.

(upbeat music) >> Okay, we're back here in theCUBE, this is day three of our coverage right here in the middle of all the action of Cloud City at Mobile World Congress. This is the hit of the entire show in Barcelona, not only in person, but out on the interwebs virtually, this is a hybrid event. This is back to real life, and theCUBE is here. I'm John Furrier and Dave Vellante and DR is here, Danielle Royston. >> Totally. >> Welcome back to theCUBE for the fourth time now at the anchor desk, coming back, we love you. >> Well, it's been a busy day, it's been a busy week. It's been an awesome week. >> John: Feeling good? >> Oh my God. >> You made the call. >> I've made the call. >> You did on your podcast what, months ago. >> Yeah, right? >> You made the call. >> Made the call. >> You're on the right side of history. >> Right, and people were like, it's going to be canceled. COVID won't be handled, blahbity blah. >> She's crazy. >> Nope, I was just crazy, I'm okay with that, right? >> Crazy good. >> Right, I'm like I'm forward looking in a lot of ways. And we were looking towards June and we're like, I think this is going to be the first event back. >> You know, the crazy ones commercial that Apple ran is one of the best commercials of all time. You can't ignore the crazy ones in a good way. You can't ignore what you're doing. And I think to me, what I'm so excited about is cause we've been covering cloud we're cloud bigots, we love the cloud, public cloud. We've been on that train from day one. But when you hear the interviews we did here in theCUBE and interviews that we talked about with the top people, Google, Amazon Web Services. We're talking about the top people, both technology leaders like Bill Vass and the people who run the telecom verticals like Alfonzo, Adolfo, I mean, Hernandez. We had Google's top networking executive, we had their industry leader and the telecom, Microsoft and the Silicon all are validating, and it's like, surround sound to what you're saying here, and it cannot be ignored. >> I mean, we are coming to a big moment in Telco, right? And I mean, I've been saying it's coming. I called 2021, the year of Public Cloud and Telco. It helped that Erickson bailed. So thank you, Erickson people. >> It was a gift. >> It was a gift. >> It was. >> It really was a gift. And it was not just for me, but I think also for the vendors in the booth, I mean, we have a Cloud City army, right? Here we go, let's start marching, and it's awesome. >> He reminds me of that baseball player that took a break, cause he had a hangover and, Cal Ripkin. >> Cal Ripkin? >> Yeah, what was that guy's name? >> Did that really happen? >> Yeah, he took a break and uh- >> New guy stepped in. >> Yeah, and so well, not Cal Ripkin. >> No, no, so before, you want to know, who was it, Lou Gehrig? >> Lou Gehrig, yeah, Lou Gehrig. >> Right, so, Lou Gehrig was nobody, and we can't remember the guy's name, nobody knows the guy's name, what was that guy's name? Nobody knows, oh, there's Lou Gehrig, he got hurt. He sat out and Lou Gehrig replaced him and never hear of him again. >> Danielle: Love it, I'll take that. >> Never, never missed a game for his entire career. So again, this is what Erickson did, they just okay, take a break. >> Yeah, but I mean, it's been great again. I had a great day yesterday, my keynote was delivered. Things are going well with the booth, we had Jon Bon Jovi. I mean, that was just epic and it was acoustic and it was right after lockdown. I think everyone was really excited to be there. But I was talking to a vendor that said we'd been able to accomplish in three days, what normally it would take three years from a sales funnel perspective. I mean, that's big and that's not me. That's not my organization. That's other organizations that are benefiting from this energy. Oh, it's awesome. >> The post isolation economy has become a living metaphor for transformation, and I've been trying to sort of grok and put the pieces together as to how this thing progresses in my interview with Portal One in particular really brought it into focus for me, anyway, I'd love to get your thoughts. One of the things we haven't talked much about is public policy, and I think about all the time, all the discussion in the United States about infrastructure, this is critical infrastructure, right? And the spectrum is a country like South Africa saying, come on in, we want to open up. We want to innovate, to me, that's the model for these tier two and tier three Telcos that are just going to disrupt the big guys, whereas, maybe China's maybe on the other end of the spectrum, very controlling, but it's the former that is going to adopt the cloud sooner, and it's going to completely transform the next decade. >> Yeah, I think this is a great technology for a smaller challenge or CSP that still is a large successful company to challenge the incumbents that are, they are dinosaurs too, they move a little bit slow, and maybe if you're a little bit faster, quicker dinosaur you'll survive longer, maybe you'll be able to transform and, and a public cloud enables that. And I think, you know I'm playing the long game here, right? Is public cloud already for every Telco in every corner of the world, no. And there's a couple of things that are barriers to that. We don't really talk about the downsides, and so maybe we sort of wrap up with- there are challenges and acknowledge there are challenges, you know, in some cases their data regulations and issues, right? And you can't right? There's not a hyperscaler in your country, right? And so you're having a little bit of challenges, but you trend this out over 10 years and then pace it with the hyperscalers that are building new data centers. They're each at 25 plus each, you know, plus or minus a few, right? They're marching along, and you trend this out over 10 years, I think one of two things happened, your data regulations are eased or a hyperscaler appears in a place you can use it, and those points converge and hopefully the software's there, and that's my effort and (claps) yeah. >> Dave: You know what's an interesting trend, DR and John, that is maybe a harbinger to this, is you just mentioned something. If the hyperscalers might not have a presence in, in a country, you know what they're doing? And our data shows this, I do that weekly series breaking analysis and the data Openstack was popping up. Like where does OpenStack come from, well, guess what, when you cut the data, it was Telcos using open source to build clouds in regions where there was no hyperscalers. >> It's a gap filler. >> Yeah, it's a gap filler, it's a bandaid. >> But I think this is where, like. outpost is such a great idea, right? Like getting outposts, and I think Microsoft has the ability to do this as well, Google less so, right? They're not providing the staff, they're doing Anthos. So you're still managing this, the rack, but they're giving you the ability to tap into their services. But I was talking to a CTO in Bolivia. He was like, we have data privacy issues in our country. There's no hyperscaler, not sure Bolivia is like next on the list for AWS, right? But he's like, I'm going to build my own public cloud. And I'm like why would you do that when you can just use outposts? And then when your data regulations release, where they get to Bolivia, you can switch and you're on the stack, and you're ready to go. I think that's what you should do. You should totally do that. >> John: Yeah, one of the things that's come up on here in the interviews, in theCUBE and here, the show is that there are risk takers and innovators and there's operators. And this has been the consistent theme around, yeah, the on-premises world you mentioned this regulation reasons, and or some workflows just have to be on premise for security reasons, whatever, that's the corner case. But the operating model of the technology architecture is shifted. And that reality, I don't think is debatable, so I find it, I got to ask you this because I'm really curious. I know you get a lot of people staring at ya, oh the public cloud's just a hosting, but why aren't people getting this architectural shift? I mean, you mentioned outpost and wavelength, which Amazon has, is a game changer. It's Amazon cloud at the hub. >> Yeah, at the edge. >> Okay, that's a low latency, again, low-hanging fruit applications, real buys, whatnot. I mean, that's an architectural dot that's been connected. Why are people getting it. >> In our industry, I think it is a lot of not invented here syndrome, right? And that's a very sort of nineties thought and I have been advocating stand on the shoulders of the greatest technologists in the world, right, and you know, there's, there is a geopolitical US thing, I think we lived through a presidency that had a sort of nationalistic approach and a lot of those conversations pop up, but I've also looked to these guys and I'm like, you're still, you still have your Huawei kit installed. And there's concerns with that too. So, and you picked it because of cost, and it's really hard to switch off of, so give me a break with your public cloud USA stuff, right? You can use it, you're just making excuses, you're just afraid. What are you afraid of, the HR implications? Let's talk about that, right? And the minute I take it there, conversation changes. >> Yeah, I talked to Teresa Carlson when she was running the public sector at AWS, she's now president of Splunk. I call her a Renaissance woman. She's been a great leader and public sector for this weird little pocket of AWS where it's a guess a sales division, but it's still its own company. >> Danielle: Yeah. >> And she's, did the CIA deal, the DOD, and the public sector partnerships are now private, a lot more private relationships, So it's not like just governments, you mentioned government and national security, and these things, you started to see the ecosystem not, not just be about companies, >> Danielle: Yeah. >> Government and private sector. So this whole vibe of the telecom being regulated, unregulated, unbundled is an interesting kind of theory. What's your thoughts and reactions to this, kind of this, melting pot of ecosystem change and evolution? >> Danielle: Yeah, I mean. I think there's a very nationalistic approach by the Telcos, right? They sort of think about the countries that they operate in. There's a couple of groups that go across multiple countries, but can there be a global Telco? Can that happen, right? Just like we say, you were saying it earlier, Netflix, right? You can say Netflix, UK. Right, and so can we have a global Telco, right. That is challenging on a lot of different levels. But think about that in a public cloud start to enable that idea, right? Elon Musk is going to get to Mars. You need a planetary level Telco. And I can, I think that day is, I mean, I don't think it's tomorrow, but I think that's like 10, 20 years away. >> Dave: You're done, we're going to see it start this decade, it's already starting. We're going to see the fruits of that dividend. >> Danielle: Yeah, it's crazy. >> I've got to ask you, you're a student of the industry and you get so much experience, it's great to have you on theCUBE and chat about, riff about these things, but, the classic who's ready for disruption question comes up, and I think there's no doubt that the Telcos as an industry has been slow moving and the role and the importance has changed. People need the need to have the internet access they need to access. >> Yeah. >> So, and you've got the edge, now applications are now running on it, since the iPhone 14 years ago, as you pointed out, people now are interested in how packets move. That's fast whether it's a doctor or an emergency worker or someone. >> Danielle: What we have done in 2020 without the internet and broadband and our mobile phones, I mean? >> You know, I think about 1920 when the Spanish flu pandemic hit a hundred years ago, those guys did not have mobile phones and they must have been bored, right? I mean, what are you going to do, right? And so, yeah I think last year really moved a lot of thinking forward in this respect, so. >> Yeah, it's always like that, that animal out in the Serengeti that gets taken down, you know, by the cheetah or the lion. How do know when someone is going to be disrupted What's the, what's the tell sign in your mind, you look at the Telco landscape. What is someone waiting to be disrupted or replaced like? >> You know what they're ostriches, how do you say that word, right? They stick their head in the sand. Like I don't want to talk about it, la la la, I don't want to, I don't want to think about it. You know, they bring up all these like roadblocks, and I'm like, okay, I'm going to come visit you in another six months to a year, and let's see what happens when the guys that are moving fast that are open-minded to this, and it's, I mean, when you start to use the public cloud, you don't, like, turn it on overnight. You start experimenting, right? You start, you take an application that is non-threatening. You have, I mean, these guys are running thousands of apps inside their data centers. Pick some boring ones, pick some old ones that no one likes, and move that to the public cloud, play with it. Right, I'm not talking about moving a whole network overnight tomorrow. You got to learn, you have no, I mean, very little talent in the Telco that know how to program against the AWS stack. Start hiring, start doing it, and you're going to start to learn about the compensation, and I used to do compensation, right? I spent a lot of time in HR, right? The compensation points and structures, they compare AWS and Google, versus a Telco. Do you want Telco stock? Do you want Google stock? >> Dave: Right, where do you want to go? >> Right, right? like that's going to challenge the HR organization in terms of compensate. How do we compensate our people when they're learning these new valuable skills? >> When you think about disruption, you know, the master or the professor of disruption, Clay Christensen, one of the best lectures he ever gave was who at Cambridge, and he gave a lecture on the steel industry, and he was describing it, it was like four layers of value in the steel industry, the value chain, it started with rebar, like the lowest end, right? >> Danielle: Yeah yeah. >> And the Telco's actually the opposite, so that, you know, when, when the international companies came in, they went after rebar, and the higher end steel companies said, nah, let them have it, that's the low margin stuff. And then eventually, uh, when they got up to the high end. >> Danielle: It was over, yeah. >> The Telcos are the opposite. They're like, the, you know, in the, in the conductivity and they're hanging on to that because it's so big, but all the high value stuff, it's already gone to the, over the top players, right. >> It's being eaten away, and I'm like, what is going to wake you guys up to realize those are your competitors, that's where the battle is, right? >> John: That's really where the value is. >> The battle of the bastards, you're there by yourself, like "Game of Thrones" and they're coming at you. >> John: You need a dragon. >> What are you doing about it? >> John: I need a dragon to compete in this market. Riding a dragon would be a good strategy. >> I know, I was just watching. Cause I have a podcast, I have a podcast called "Telco In 20" and we always put like little nuggets in the show notes, I personally reviewed them, I was just reviewing the one for the keynote that we're putting out, and I had a dragon in my keynote, right? It was a really great moment, it was really fun to do, but there's, I don't know if you guys are "Game of Thrones" fans. >> Yeah. >> Sure. >> Right, but there's a great moment when Daenerys gets her dragons, the baby dragons, and she takes over the Unsullied Army, right? And it's just this, right? Like all of a sudden the tables turn in an instant where she has nothing, and she's like on her quest, right. I'm on a quest. >> Dave: Comes out of the fire. >> Right, comes out of the fire, the unburnt, right? She has her dragons, right? She has them hatch. She takes over the Unsullied Army, right? Slaves, it starts her march, right? And I'm like, we're putting that clip into the show notes because I think that's where we are. I think I've hatched some dragons, right? The Cloud City army, let's go, let's go take on Telco. >> John: Well, I mean, this to me. >> Easy. >> It definitely have made, made it happen because I heard many people talking about cloud, this is turning into a cloud show. The question is, when does this going to be a cloud show? That's just Cloud City, it's a big section of the show. I mean, all the big players are behind it. >> Danielle: Yeah, yeah. >> Amazon Web Services, Google Azure, Ecosystem, startups, thinking differently, but everyone's agreeing why aren't we doing this? >> I think, like I said, I mean, people are like, you're such a visionary, and how did, why do you think this will work, I'm like, it's worked in every other industry. Am I really that visionary, and like, these are the three best tech companies in the world, like, are, are you kidding me? And so I think we've shown the momentum here. I think we're looking forward to 2022, you know? And that we see 2022, you got to start planning this the minute we get back, right? Like I wouldn't recommend doing this in a hundred days again, that was a very painful, but you know, February, I was, there's a sign inside NWC, February 28th. Right, we're talking seven months. You got to get going now. >> John: Let's get on the phone. >> With Telco, I mean, I think you're right on. I mean, you know, remember Skype, in the early days, right? >> Danielle: Yeah, yeah. >> It wasn't regional. It was just, plug into the internet. >> Danielle: It was just Skype, it was just WhatsApp. >> Well this is a great location, if you can get a shot guys of the people behind us, I don't know if you can, if you're watching check out the scene here, It's winding down, a lot of people having happy hour. Now this is a social construct here at Cloud City, not only is it chock full of information, reporting that we're doing and getting all the data and with the presentations on the main stage, with Adam and the studio and the team, this is a place where people are meeting and there's deals being done face to face, intimate relationships, the best of the best are here, they make the trek. So there's been a successful formula. Of course theCUBE is in the middle of all the action, which we love, we're psyched to be back. I want to thank you personally, while we have you on stage here. >> I want to thank you guys, and the crew, the crew has been amazing, turning out videos on short order. We have all these crews in different cities, it's, our own show has been virtual. You know, Adam's in Bristol, right? We're here, this was an experiment, we talked about this a hundred days ago, 90 days ago. Could we get theCUBE there, do the show but also theCUBE. >> You are a visionary, you said made for TV hybrid event with your team, produce television shows, theCUBE, we're digital, we love you guys, great alignment, but it's magical because the content doesn't end here, the show might end, they might break down the beautiful plants and the exhibits, but the community is going to continue, the content and the conversations. >> Yeah. >> So, we were looking forward to it and- >> I'm super glad, super glad we did this. >> Awesome, well, any final moments that you would like to share in the last two minutes we have, favorite moments, observations, funny things that have happened to you, weird things that have happened to you, share something that people might not know, or a favorite moment? >> I think, I don't know that people know, we have a 3D printer in the coffee shops, and so you can upload any picture and they're 3d printing, coffee art, right? So I've been seeing lots of social posts around people uploading their, their logos and things like that. I think Jon Bon Jovi, he was super thankful to be back. He thanked me personally two different times of like, I'm just glad to be out in front of people. And I think just even just the people walking around, thank you for being brave, thank you for coming back. You've helped Barcelona and we're happy to be together. Even if it is with masks, it's hard to do business with masks on, everyone's happy and psyched. >> John: Well the one thing that people cannot do relative to you is they cannot ignore you. You are making a great big wave. >> Danielle: I shout pretty loud, It's kind of hard to ignore me. >> You're making a great big wave, you're on the right side, we believe, of history, public cloud is driving the bus down main street of Cloud City, and if people don't get out of the way, they will be under the bus. >> I'm, like I said, in my keynote, it's go time let's do it. >> Okay. Thank you so much for all your attention and mission behind the cloud and the success. >> Danielle: We'll do it again. We're going to do it again soon. >> After Togi's a hundred million dollar investment, you're the CEO of Togi that, let's follow that progress, and of course, Telco DR, Danielle Royston, the digital revolution. Thanks for coming on with you. >> Thank you guys, it was super fun. >> This is theCUBE I'm John Furrier with Dave Vallante, we're going to send it back to Adam in the studio. Thanks, the team here. >> Woo! (audience applauding) >> I want to thank the team, everyone here, Adam is great, Chloe. >> Great working with you guys. >> Awesome, and what a great crew. >> So great. >> Thank you everybody. That's it for theCUBE, here on the last day, Wednesday of theCUBE, stay tuned for tomorrow more action on the main stage, here in Cloud City. Thanks for watching.

(upbeat music) >> Hey, we're back here in theCube. This is day three of our coverage right here in the middle of all the action of Cloud City at Mobile World Congress. This is the hit of the entire show in Barcelona, not only in person, but out on the interwebs virtually. This is a hybrid event. This is back to real life, and theCube is here. I'm John Furrier with Dave Vellante and D. R. is here, Danielle Royston. >> Totally. >> Welcome back to theCube for fourth time. now at the anchor desk, coming back. >> I don't know. It's been a busy day. It's been a busy week. It's been an awesome week. >> Dave: Feeling good? >> Oh, my god. >> You made the call. >> I made the call. You finished your podcast, what months ago? >> Yeah. >> Made the call. >> Made the call. You're on the right side of history. >> Right? And people were like, "It's going to be canceled. COVID won't be handled." Blahbity blah. >> She's crazy. >> And I'm like, nope. She's crazy. I'm okay with that. Right? But I'm like... >> Crazy good. >> Right, I'm like, I'm forward-looking in a lot of ways. And we were looking towards June, and we're like, "I think this is going to be the first event back. We're going to be able to do it." >> You know, the crazy one's commercial that Apple ran, probably one of the best commercials of all time. You can't ignore the crazy ones in a good way. You can't ignore what you're doing. And I think to me, what I'm so excited about is, 'cause we've been covering cloud. We're cloud bigots. We love the cloud, public cloud. We've been on that train from day one. But when you hear the interviews we did here on theCube and interviews that we talked about with the top people, Google, Amazon Web Services. We're talking about the top people, both technology leaders like Bill Vass and the people who run the Telecom Verticals like Alf, Alfonzo. >> Danielle: Yeah. >> Adolfo, I mean, Hernandez. >> Danielle: Yeah. >> We had Google's top networking executive. We had their industry leader in the telecom, Microsoft, and the Silicon. All are validating, and it's like surround sound to what you're saying here. And it cannot be ignored. >> I mean, we are coming to a big moment in Telco, right? And I mean, I've been saying that it's coming. I called 2021, the year of public cloud and Telco. It helped that Ericcson bailed. So thank you, Ericcson people. >> Dave: It was a gift. >> It was a gift. >> John: It really was. >> It really was a gift. And it was not just for me, but I think also for the vendors in the booth. I mean, we have a Cloud City army, right? Here we go. Let's start marching. And it's awesome. >> He reminds me of that baseball player that took a break 'cause he had a hangover and Cal Ripken. >> Cal Ripken, right, yeah, yeah. What was that guy's name? >> Did it really happen? >> Yeah, he took a break and... >> The new guy stepped in? >> Yeah, and so we'll go to Cal Ripken. >> No, no, so before it was it? Lou Gehrig. >> Lou Gehrig, yeah. >> Right, so Lou Gehrig was nobody. And we can't remember the guy's name. Nobody knows the guy's name. >> Danielle: Yeah, yeah. >> What was that guy's name? Nobody knows. Oh, 'cause Lou Garrett, he got hurt. >> Danielle: And Lou Gehrig stepped in. >> He sat out, and Lou Gehrig replaced him. >> Danielle: Love it. >> And never heard of him again. >> Danielle: I'll take that. >> Never missed a game. Never missed a game for his entire career. So again, this is what Ericcson did. They just okay, take a break and... >> But I mean, it's been great. Again, I had a great day yesterday. My keynote was delivered. Things are going well with the booth. We had Jon Bon Jovi. I mean, that was just epic, and it was acoustic, and it was right after lockdown. I think everyone was really excited to be there. But I was talking to a vendor that said we'd been able to accomplish in three days what normally it would take three years from a sales funnel perspective. I mean, that is, that's big, and that's not me. That's not my organization. That's other organizations that are benefiting from this energy. Oh, that's awesome. >> The post-isolation economy has become a living metaphor for transformation. And I've been trying to sort of grok and put the pieces together as to how this thing progresses. And my interview with Portaone, in particular, >> Danielle: Yeah. >> really brought it into focus for me, anyway. I'd love to get your thoughts. One of the things we haven't talked much about is public policy. And I think about all the time, all the discussion in the United States about infrastructure, this is critical infrastructure, right? >> Danielle: Yeah. >> And the spectrum is a country like South Africa saying, "Come on in. We want to open up." >> Danielle: Yeah. >> "We want to innovate." And to me that's to me, that's the model for these tier two and tier three telcos that are just going to disrupt the big guys. Whereas, you know, China, may be using the other end of the spectrum, very controlling, but it's the former that is going to adopt the cloud sooner. It's going to completely transform the next decade. >> Yeah, I think this is a great technology for a smaller challenger CSP that still is a large successful company to challenge the incumbents that are, they are dinosaurs too. They move a little bit slow. And maybe if you're a little bit faster, quicker dinosaur you'll survive longer. Maybe it will be able to transform and a public cloud enables that. And I think, you know, I'm playing the long game here, right? >> Dave: Yeah. >> Is public cloud ready for every telco in every corner of the world? No. And there's a couple of things that are barriers to that. We don't really talk about the downsides, and so maybe we sort of wrap up with, there are challenges, and I acknowledge there are challenges. You know, in some cases there are data regulations and issues, right? And you can't, right? There's not a hyperscaler in your country, right? And so you're having a little bit of challenges, but you trend this out over 10 years and then pace it with the hyperscalers are building new data centers. They're each at 25 plus each, plus or minus a few, right? They're marching along, and you trend this out over 10 years, I think one of two things happens. Your data regulations are eased or you a hyperscaler appears in a place you can use it. And those points converge, and hopefully the software's there, and that's my effort. And, yeah. >> You know what's an interesting trend, D. R., John? That is maybe a harbinger to this. You just mentioned something. If the hyperscalers might not have a presence in a country, you know what they're doing? And our data shows this, I do that weekly series "Breaking Analysis," and the data, OpenStack was popping up. >> Danielle: Yeah. >> Like where does OpenStack come from? Well, guess what. When you cut the data, it was telcos using open source to build clouds in regions where there was no hyperscaler. >> Where it didn't exist, yeah. >> So it's a-- >> Gap-filler. >> Yeah, it's a gap-filler. It's a Band-aid. >> But I think this is where like Outpost is such a great idea, right? Like getting Outposts, and I think Microsoft has the ability to do this as well, Google less so, right. They're not providing the staff. They're doing Anthos, so you're still managing this, the rack, but they're giving you the ability to tap into those services. But I was talking to a CE, a CTO in Bolivia. He was like, "We have data privacy issues in our country. There's no hyperscaler." Not sure Bolivia is like next on the list for AWS, right? But he's like, "I'm going to build my own public cloud." And I'm like, "Why would you do that when you can just use Outposts?" And then when your data regulations release or there's a, they get to Bolivia, you can switch and you're on the stack and you're ready to go. I think that's what you should do. You should totally do that. >> Yeah, and one of the things that's come up here on the interviews and theCube and here, the show, is that there are risk takers and innovators and there's operators. And this has been the consistent theme around, yeah, the on-premises world. You mentioned this regulation reasons and/or some workflows just have to be on premise for security reasons, whatever. That's the corner case. >> Danielle: Yeah. >> But the operating model of the technology architecture is shifted. >> Danielle: Yep. >> And that reality, I don't think, is debatable. So I find it. I've got to ask you this because I'm really curious. I know you get a lot of people steering 'ya, oh the public cloud's just a hosting, but why aren't people getting this architectural shift? I mean, you mentioned Outpost, and Wavelength, which Amazon has, is a game changer. It's Amazon Cloud at the hub. >> Yeah, at the edge, yeah. >> Okay, that's a low latency again, low-hanging fruit applications, robotics, whatnot. I mean, that's an architectural dot that's been connected. >> Yeah. >> Why aren't people getting it? >> In our industry, I think it is a lot of not invented here syndrome, right? And that's a very sort of nineties thought, and I have been advocating stand on the shoulders of the greatest technologists in the world. Right? And you know, there is a geopolitical US thing. I think we lived through a presidency that had a sort of nationalistic approach and a lot of those conversations pop up, but I've also looked to these guys and I'm like, you still have your Huawei kit installed, and there's concerns with that, too. So, and you picked it because of cost. And it's really hard to switch off of. >> John: Yeah. >> So give me a break with your public cloud USA stuff, right? You can use it. You're just making excuses. You're just afraid. What are you afraid of? The HR implications? Let's talk about that, right? And the minute I take it there, conversation changes. >> I talked to Teresa Carlson when she was running the public sector at AWS. She's now president of Splunk. I call her a Renaissance woman. She's been a great leader. In public sector there's been this weird little pocket of AWS where it's, I guess, a sales division, but it's still its own company. >> Danielle: Yeah. >> And she just did the CIA deal. The DOD and the public sector partnerships are now private, a lot more private relationships. So it's not like just governments. You mentioned government and national security and these things. You start to see the ecosystem, not, not just be about companies, government and private sector. So this whole vibe of the telecomm being regulated, unregulated, unbundled is an interesting kind of theory. What's your thoughts and reactions to this kind melting pot of ecosystem change and evolution? >> Yeah, I mean, I think there's a very nationalistic approach by the telcos, right? They sort of think about the countries that they operate in. There's a couple of groups that go across multiple countries, but can there be a global telco? Can that happen, right? Just like we say, you were saying it earlier, Netflix. Right? You didn't say Netflix, UK, right? And so can we have a global telco, right? That is challenging on a lot of different levels. But think about that in a public cloud starts to enable that idea. Right? Elon Musk is going to get Mars. >> Dave: Yep. >> John: Yeah. >> You need a planetary level telco, and I think that day is, I mean, I don't think it's tomorrow, but I think that's like 10, 20 years away. >> You're done. We're going to see it start this decade. It's already starting. >> Danielle: Yeah. >> But we're going to see the fruits of that dividend. >> Danielle: Right, yeah. >> I got to ask you. You're a student of the industry and you got so much experience. It's great to have you on theCube and chat about, riff about, these things, but the the classic "Who's ready for disruption?" question comes up. And I think there's no doubt that the telcos, as an industry, has been slow moving, and the role and the importance has changed. People need the need to have the internet access. They need to access. >> Danielle: Yeah. >> So and you've got the Edge. Now applications are now running on a, since the iPhone 14 years ago, as you pointed out, people now are interested in how packets move. >> Danielle: Yeah. >> That's fast, whether it's a doctor or an emergency worker or someone. >> What would we have done in 2020 without the internet and broadband and our mobile phones? I mean. >> Dave: We would have been miserable. >> You know, I think about 1920 when the Spanish flu pandemic hit a hundred years ago. Those guys did not have mobile phones, and they must have been bored, right? I mean, what are you going to do? Right? And so, yeah, I think, I think last year really moved a lot of thinking forward in this respect, so. >> Yeah, it's always like that animal out in the Serengeti that gets taken down, you know, by the cheetah or the lion. How do you know when someone is going to be disrupted? What's the, what's the tell sign in your mind? You look at the telco landscape, what is someone waiting to be disrupted or replaced look like? >> Know what? They're ostriches. Ostriches, how do you say that word right? They stick their head in the sand. Like they don't want to talk about it. La, la, la, I don't want to. I don't want to think about it. You know, they bring up all these like roadblocks, and I'm like, okay, I'm going to come visit you in another six months to a year, and let's see what happens when the guys that are moving fast that are open-minded to this. And it's, I mean, when you start to use the public cloud, you don't like turn it on overnight. You start experimenting, right? You start. You take an application that is non-threatening. You have, I mean, these guys are running thousands of apps inside their data centers. Pick some boring ones. Pick some old ones that no one likes. Move that to the public cloud. Play with it, right? I'm not talking about moving your whole network overnight tomorrow. You got to learn. You have no, I mean, very little talent in the telco that know how to program against the AWS stack. Start hiring. Start doing it. And you're going to start to learn about the compensation. And I used to do compensation, right? I spent a lot of time in HR, right? The compensation points and structures, and they can bear AWS and Google versus a telco. You want Telco stock? Do you want Google stock? >> John: Right, where do you want to go? >> Right? Right? And so you need to start. Like that's going to challenge the HR organization in terms of compensate. How do we compensate our people when they're learning these new, valuable skills? >> When you think about disruption, you know, the master or the professor of disruption, Clay Christensen, one of the best lectures he ever gave is we were at Cambridge, and he gave a lecture on the steel industry and he was describing it. It was like four layers of value in the steel industry, the value chain. It started with rebar, like the lowest end. Right? >> Danielle: Yeah, yeah. >> And the telco's actually the opposite. So, you know, when the international companies came in, they went after rebar, and the higher end steel companies said, "Nah, let them have it." >> Danielle: Let it go. >> "That's the low margin stuff." And then eventually when they got up to the high end, they all got killed. >> Danielle: It was over, yeah. >> The telcos are the opposite. They're like, you know, in the connectivity, and they're hanging on to that because it's so big, but all the high value stuff, it's already gone to the over-the-top players, right? >> It's being eaten away. And I'm like, "What is going to wake you guys up to realize those are your competitors?" That's where the battle is, right? >> Dave: That's really where the value is. >> The battle of the bastards. You're there by yourself, the Game of Thrones, and they're coming at you. >> John: You need a dragon. >> What are you doing about it? >> I need a dragon. I need a dragon to compete in this market. Riding on the dragon would be a good strategy. >> I know. I was just watching. 'Cause I have a podcast. I have a podcast called "Telco in 20," and we always put like little nuggets in the show notes. I personally review them. I was just reviewing the one for the keynote that we're putting out. And I had a dragon in my keynote, right? It was a really great moment. It was really fun to do. But there's, I don't know if you guys are Game of Thrones fans. >> Dave: Oh, yeah. >> John: For sure. >> Right? But there's a great moment when Daenerys guts her dragons, the baby dragons, and she takes over the Unsullied Army. Right? And it's just this, right? Like all of a sudden, the tables turn in an instant where she has nothing, and she's like on her quest, right? I'm on a quest. >> John: Comes out of the fire. >> Right, comes out of the fire. The unburnt, right? She has her dragons, right? She has them hatch. She takes over the Unsullied Army, right? Slays and starts her march, right? And I'm like, we're putting that clip into the show notes because I think that's where we are. I think I've hatched some dragons, right? The Cloud City Army, let's go, let's go take on Telco. >> John: Well, I mean to me... >> Easy. >> I definitely have made it happen because I heard many people talking about cloud. This is turning into a cloud show. The question is, when does this be, going to be a cloud show? You know it's just Cloud City is a big section of the show. I mean, all the big players are behind it. >> Danielle: Yeah, yeah. >> Amazon Web Services, Google, Azure, Ecosystem, startups thinking differently, but everyone's agreeing, "Why aren't we doing this?" >> I think, like I said, I mean, people are like, you're such a visionary. And how did, why do you think this will work? I'm like, it's worked in every other industry. Am I really that visionary? And like, these are the three best tech companies in the world. Like, are you kidding me? And so I think we've shown the momentum here. I think we're looking forward to 2022, you know? And do we see 2022, you get to start planning this the minute we get back. Right? >> John: Yeah. >> Like I wouldn't recommend doing this in a hundred days again. That was a very painful, but you know, February, I was, there's a sign inside NWC, February 28th, right? We're talking seven months. You got to get going now. >> John: Let's get on the phone. (John and Dave talking at the same time) >> I mean, I think you're right on. I mean, you know, remember Skype in the early days? >> Danielle: Yeah, yeah, yeah, yeah. >> It wasn't regional. >> Danielle: Yeah. >> It was just plug into the internet, right? >> Danielle: It was just Skype. It was just WhatsApp. >> Well, this great location, and if you can get a shot, guys, of the people behind us. I don't know if you can. If you're watching, check out the scene here. It's winding down. A lot of people having happy hour now. This is a social construct here at Cloud City. Not only is it chock full of information, reporting that we're doing and getting all the data and with the presentations on the main stage with Adam and the studio and the team. This is a place where people are meeting and there's deals being done face to face, intimate relationships. The best of the best are here. They make the trek, so there's been a successful formula. Of course theCube is in the middle of all the action, which we love. We're excited to be back. I want to thank you personally while we have you on stage here. >> I want to thank you guys and the crew. The crew has been amazing turning out videos on short order. We have all these crews in different cities. It's our own show has been virtual. You know, Adam's at Bristol, right? We're here. This was an experiment. We talked about this a hundred days ago, 90 days ago. Could we get theCube there and do the show, but also theCube. >> You are a visionary. And you said, made for TV hybrid event with your team, reduced television shows, theCube. We're digital. We love you guys. Great alignment, but it's magical because the content doesn't end here. The show might end. They might break down the beautiful plants and the exhibits, but the community is going to continue. The content and the conversations. >> Yeah. >> So. >> We are looking forward to it and. >> Yeah, super-glad, super-glad we did this. >> Awesome. Well, any final moments that you would like to share? And the last two minutes we have, favorite moments, observations, funny things that have happened to you, weird things that have happened to you. Share something that people might not know or a favorite moment. >> I think, I mean I don't know that people know we have a 3D printer in the coffee shops, and so you can upload any picture, and there are three 3D printing coffee art, right? So I've been seeing lots of social posts around people uploading their, their logos and things like that. I think Jon Bon Jovi, he was super-thankful to be back. He thanked me personally two different times of like, I'm just glad to be out in front of people. And I think just even just the people walking around, thank you for being brave, thank you for coming back. You've helped Barcelona, and we're happy to be together even if it is with masks. It's hard to do business with masks on. Everyone's happy and psyched. >> The one thing that people cannot do relative to you is they cannot ignore you. You are making a great big waves. >> Danielle: I shout pretty loud. It's kind of hard to ignore me. >> Okay, you're making a great big wave. You're on the right side, we believe, of history. Public cloud is driving the bus down main street of Cloud City, and if people don't get out of the way, they will be under the bus. >> And like I said, in my keynote, it's go time. Let's do it. >> Okay, thank you so much for all your tension and mission behind the cloud and the success of... >> Danielle: We'll do it again. We're going to do it again soon. >> Ketogi's hundred million dollar investment. Be the CEO of Togi as we follow that progress. And of course, Telco D. R. Danielle Royston, the digital revolution. Thanks for coming on theCube. >> Thank you, guys. It was super-fun. Thank you so much. >> This is theCube. I'm John Furrier with Dave Vellante. We're going to send it back to Adam in the studio. Thanks the team here. (Danielle clapping and cheering) I want to thank the team, everyone here. Adam is great. Chloe, great working with you guys. Awesome. And what a great crew. >> So great. >> Thank you everybody. That's it for theCube here on the last day, Wednesday, of theCube. Stay tuned for tomorrow, more action on the main stage here in Cloud City. Thanks for watching.

>> From theCUBE Studios in Palo Alto and Boston, bringing you data-driven insights from theCUBE and ETR. This is Breaking Analysis with Dave Vellante. >> Mobile World Congress is alive, theCUBE will be there and we'll certainly let you know if it's alive and well when we get on the ground. Now, as we approach a delayed mobile world congress, it's really appropriate to reflect in the state of the telecoms industry. Let's face it. Telcos have done of really good job of keeping us all connected during the pandemic, supporting work from home and that whole pivot, accommodating the rapid shift to landline traffic, securing the network and keeping it up and running but it doesn't change the underlying fundamental dilemma that Telco has faced. Telco is a slow growth, no growth industry, with revenue expectations in the low single digits. And at the same time network traffic continues to grow at 20% annually. And last year it grew at 40% to 50%. Despite these challenges, Telcos are still investing in the future. For example, the Telco industry collectively is selling out more than a trillion dollars in the first half of this decade on 5G and fiber infrastructure. And it's estimated that there are now more than 200 5G networks worldwide. But a lot of questions remain, not the least of which is, can and should Telcos go beyond connectivity and fiber. Can the Telcos actually monetize 5G or whatever's next beyond 5G? Or is that going to be left to the ecosystem? Now what about the ecosystem? How is that evolving? And very importantly, what role will the Cloud Hyperscalers play in Telco? Are they infrastructure on which the Telcos can build or are they going to suck the value out of the market as they have done in the enterprise? Hello everyone, and welcome to this week's Wiki Bond Cube Insights powered by ETR. In this breaking analysis, it's my pleasure to welcome a long time telecoms industry analyst and colleague, and the founding director of Lewis Insight, Mr. Chris Lewis. Chris, welcome to the program. Thanks for coming on >> Dave, it's a pleasure to be here. Thank you for having me. >> It is really our pleasure. So, we're going to cover a lot of ground today. And first thing, we're going to talk about Mobile World Congress. I've never been, you're an expert at that and what we can expect. And then we're going to review the current state of telecoms infrastructure, where it should go. We're going to dig into transformation. Is it a mandate? Is it aspirational? Can Telcos enter adjacent markets in ways they haven't been able to in the past? And then how about the ecosystem? We're going to talk about that, and then obviously we're going to talk about Cloud as I said, and we'll riff a little bit on the tech landscape. So Chris, let's get into it, Mobile World Congress, it's back on, what's Mobile World Congress typically like? What's your expectation this year for the vibe compared to previous events? >> Well Dave, the issue of Mobile World Congress is always that we go down there for a week into Barcelona. We stress ourselves building a matrix of meetings in 30 minutes slots and we return at the end of it trying to remember what we'd been told all the way through. The great thing is that with the last time we had a live, with around 110,000 people there, you could see anyone and everyone you needed to within the mobile, and increasingly the adjacent industry and ecosystem. So, he gave you that once a year, big download of everything new, obviously because it's the Mobile World Congress, a lot of it around devices, but increasingly over the last few years, we saw many, many stands with cars on them because the connected car became an issue, a lot more software oriented players there, but always the Telcos, always the people providing the network infrastructure. Increasingly in the last few years people provided the software and IT infrastructure, but all of these people contributing to what the network should be in the future, what needs to be connected. But of course the reach of the network has been growing. You mentioned during lockdown about connecting people in their homes, well, of course we've also been extending that connection to connect things whether it's in the home or the different devices, monitoring of doorbells and lights and all that sort of stuff. And in the industry environment, connecting all of the robots and sensors. So, actually the perimeter, the remit of the industry to connect has been expanding, and so is the sort of remit of Mobile World Congress. So, we set an awful lot of different suppliers coming in, trying to attach to this enormous market of roughly $1.5 trillion globally. >> Chris, what's the buzz in the industry in terms of who's going to show up. I know a lot of people have pulled out, I've got the Mobile World Congress app and I can see who's attending. And it looks like quite a few people are going to go but what's your expectation? >> Well, from an analyst point of view, obviously I'm mainly keeping up with my clients and trying to get new clients. I'm looking at it and going most of my clients are not attending in person. Now, of course, we need the DSMA, we need Mobile World Congress for future for the industry interaction. But of course, like many people having adopted and adapted to be online, then they're putting a lot of the keynotes online, a lot of the activities will be online. But of course many of the vendors have also produced their independent content and content to actually deliver to us as analysts. So, I'm not sure who will be there. I like you, but you'll be on the ground. You'll be able to report back and let us know exactly who turned up. But from my point of view, I've had so many pre-briefs already, the difference between this year and previous years, I used to get loads of pre-briefs and then have to go do the briefs as well. So this year I've got the pre-brief so I can sit back, put my feet up and wait for your report to come back as to what's happening on the ground. >> You got it. Okay, let's get into a little bit and talk about Telco infrastructure and the state, where it is today, where it's going, Chris, how would you describe the current state of Telco infrastructure? Where does it need to go? Like, what is the ideal future state look like for Telcos in your view? >> So there's always a bit of an identity crisis when it comes to Telco. I think going forward, the connectivity piece was seen as being table stakes, and then people thought where can we go beyond connectivity? And we'll come back to that later. But actually to the connectivity under the scenario I just described of people, buildings, things, and society, we've got to do a lot more work to make that connectivity extend, to be more reliable, to be more secure. So, the state of the network is that we have been building out infrastructure, which includes fiber to connect households and businesses. It includes that next move to cellular from 4G to 5G. It obviously includes Wi-Fi, wherever we've got that as well. And actually it's been a pretty good state, as you said in your opening comments they've done a pretty good job keeping us all connected during the pandemic, whether we're a fixed centric market like the UK with a lot of mobile on top and like the US, or in many markets in Africa and Asia, where we're very mobile centric. So, the fact is that every country market is different, so we should never make too many assumptions at a very top level, but building out that network, building out the services, focusing on that connectivity and making sure we get that cost of delivery right, because competition is pushing us towards having and not ever increasing prices, because we don't want to pay a lot extra every time. But the big issue for me is how do we bring together the IT and the network parts of this story to make sure that we build that efficiency in, and that brings in many questions that we going to touch upon now around Cloud and Hyperscalers around who plays in the ecosystem. >> Well, as you know, Telco is not my wheelhouse, but hanging around with you, I've learned, you've talked a lot about the infrastructure being fit for purpose. It's easy from an IT perspective. Oh yeah, it's fossilized, it's hardened, and it's not really flexible, but the flip side of that coin is as you're pointing out, it's super reliable. So, the big talk today is, "Okay, we're going to open up the network, open systems, and Open RAN, and open everything and microservices and containers. And so, the question is this, can you mimic that historical reliability in that open platform? >> Well, for me, this is the big trade-off and in my great Telco debate every year, I always try and put people against each other to try and to literally debate the future. And one of the things we looked at was is a more open network against this desire of the Telcos to actually have a smaller supplier roster. And of course, as a major corporation, these are on a national basis, very large companies, not large compared to the Hyperscalers for example, but they're large organizations, and they're trying to slim down their organization, slim down the supplier ecosystem. So actually in some ways, the more open it becomes, the more someone's got to manage and integrate all those pieces together. And that isn't something we want to do necessarily. So, I see a real tension there between giving more and more to the traditional suppliers. The Nokia's, Ericsson's, Huawei's, Amdocs and so on, the Ciscos. And then the people coming in breaking new ground like Mavenir and come in, and the sort of approach that Rakuten and Curve taken in bringing in more open and more malleable pieces of smaller software. So yeah, it's a real challenge. And I think as an industry which is notorious for being slow moving, actually we've begun to move relatively quickly, but not necessarily all the way through the organization. We've got plenty of stuff sitting on major or mainframes still in the back of the organization. But of course, as mobile has come in, we've started to deal much more closely, uninteractively in real time, God forbid, with the customers. So actually, at that front end, we've had to do things a lot more quickly. And that's where we're seeing the quickest adaptation to what you might see in your IT environment as being much more, continuous development, continuous improvement, and that sort of on demand delivery. >> Yeah, and we're going to get to that sort of in the Cloud space, but I want to now touch on Telco transformation which is sort of the main theme of this episode. And there's a lot of discussion on this topic, can Telcos move beyond connectivity and managing fiber? Is this a mandate? Is it a pipe dream that's just aspirational? Can they attack adjacencies to grow beyond the 1% a year? I mean, they haven't been successful historically. What are those adjacencies that might be, an opportunity and how will that ecosystem develop? >> Sure. >> So Chris, can and should Telcos try to move beyond core connectivity? Let's start there. >> I like what you did there by saying pipe dreams. Normally, pipe is a is a negative comment in the telecom world. But pipe dream gives it a real positive feel. So can they move beyond connectivity? Well, first of all, connectivity is growing in terms of the number of things being connected. So, in that sense, the market is growing. What we pay for that connectivity is not necessarily growing. So, therefore the mandate is absolutely to transform the inner workings and reduce the cost of delivery. So, that's the internal perspective. The external perspective is that we've tried in many Telcos around the world to break into those adjacent markets, being around media, being enterprise, being around IOT, and actually for the most part they've failed. And we've seen some very significant recent announcements from AT&T, Verizon, BT, beginning to move away from, owning content and not delivering content, but owning content. And the same as they've struggled often in the enterprise market to really get into that, because it's a well-established channel of delivery bringing all those ecosystem players in. So, actually rather than the old Telco view of we going to move into adjacent markets and control those markets, actually moving into them and enabling fellow ecosystem players to deliver the service is what I think we're beginning to see a lot more of now. And that's the big change, it's actually learning to play with the other people in the ecosystem. I always use a phrase that there's no room for egos in the ecosystem. And I think Telcos went in initially with an ego thinking we're really important, we are on connectivity. But actually now they're beginning to approach the ecosystem things saying, "How can we support partners? How can we support everyone in this ecosystem to deliver the services to consumers, businesses and whomever in this evolving ecosystem?" So, there are opportunities out there, plenty of them, but of course, like any opportunity, you've got to approach it in the right way. You've got to get the right investment in place. You've got to approach it with the right open API so everyone can integrate with your approach, and approach it, do I say with a little bit of humility to say, "Hey, we can bring this to the table, how do we work together? >> Well, it's an enormous market. I think you've shared with me, it's like 1.4 trillion. And I want to stay on these adjacencies for a minute, because one of the obvious things that Telcos will talk about is managed services. And I know we have to be careful of that term in an IT context, that it's different in a, you're talking about managing connectivity, but there's professional services. That's a logical sort of extension of their business and probably a safe adjacency, maybe not even adjacency, but they're not going to get into devices. I mean, they'll resell devices, but they're not going to be, I would presume not go back to trying to make devices, but there's certainly the edge and that's so, it'll define in opaque, but it's huge. If there's 5G, there's the IT component and that's probably a partnership opportunity. And as you pointed out, there's the ecosystem, but I wonder, how do you think about 5G as an adjacency or indoor opportunity? Is it a revenue opportunity for Telcos or is that just something that is really aspirational? >> Oh, absolutely it's a revenue opportunity, but I prefer to think of 5G as being a sort of a metaphor for the whole future of telecom. So, we usually talk, and MWC would normally talk about 5G just as a mobile solution. Of course, what you can get with, you can use this fixed wireless access approach, where the roots that sits in your house or your building. So, it's a potential replacement for some fixed lines. And of course, it's also, gives you the ability to build out, let's say in a manufacturing or a campus environment, a private 5G network. So, many of the early opportunities we're seeing with 5G are actually in that more private network environment addressing those very low latency, and high bandwidth requirements. So yeah, there are plenty of opportunities. Of course, the question here is, is connectivity enough, or especially with your comment around the edge, at the edge we need to manage connectivity, storage, compute, analytics, and of course the applications. So, that's a blend of players. It's not going to be in the hands of one player. So yes, plenty of opportunities but understanding what comes the other way from the customer base, where that's, you and I in our homes or outward as an about, or from a business point of view, an office or a campus environment, that's what should be driving, and not the technology itself. And I think this is the trap that the industry has fallen into many times, is we've got a great new wave of technology coming, how can we possibly deliver it to everybody rather than listening to what the customers really require and delivering it in a way consumable by all those different markets. >> Yeah now, of course all of these topics blend together. We try to keep them separately, but we're going to talk about Cloud, we're going to talk about competition, But one of the areas that we don't have a specific agenda item on is, is data and AI. And of course there's all this data flowing through the network, so presumably it's an opportunity for the Telcos. At the same time, they're not considered AI experts. They do when you talk about Edge, they would appear to have the latency advantage because of the last mile and their proximity, to various end points. But the Cloud is sort of building out as well. How do you think about data and AI as an opportunity for Telco? >> I think the whole data and AI piece for me sits on top of the cake or pie, whatever you want to call it. What we're doing with all this connectivity, what we're doing with all these moving parts and gathering information around it, and building automation into the delivery of the service, and using the analytics, whether you call it ML or AI, it doesn't really matter. But actually using that information to deliver a better service, a better outcome. Now, of course, Telcos have had much of this data for years and years, for decades, but they've never used it. So, I think what's happening is, the Cloud players are beginning to educate many of the Telcos around how valuable this stuff is. And that then brings in that question of how do we partner with people using open APIs to leverage that data. Now, do the Telcos keep hold of all that data? Do they let the Cloud players do all of it? No, it's going to be a combination depending on particular environments, and of course the people owning their devices also have a vested interest in this as well. So, you've always got to look at it end to end and where the data flows are, and where we can analyze it. But I agree that analysis on the device at the Edge, and perhaps less and less going back to the core, which is of course the original sort of mandate of the Cloud. >> Well, we certainly think that most of the Edge is going to be about AI inferencing, and then most of the data is going to stay at the edge. Some will come back for sure. And that is big opportunity for whether you're selling compute or conductivity, or maybe storage as well, but certainly insights at the Edge. >> Everything. >> Yeah. >> Everything, yeah. >> Let's get into the Cloud discussion and talk about the Hyperscalers, the big Hyperscaler elephant in the room. We're going to try to dig into what role the Cloud will play in the transformation of telecoms on Telecom TV at the great Telco debate. You likened the Hyperscalers, Chris, to Dementors from Harry Potter hovering over the industry. So, the question is, are the Cloud players going to suck the value out of the Telcos? Or are they more like Dobby the elf? They're powerful, there's sometimes friendly but they're unpredictable. >> Thank you for extending that analogy. Yes, it got a lot of reaction when I use that, but I think it indicates some of the direction of power shift where, we've got to remember here that Telcos are fundamentally national, and they're restricted by regulation, and the Cloud players are global, perhaps not as global as they'd like be, but some regional restrictions, but the global players, the Hyperscalers, they will use that power and they they will extend their reach, and they are extending their reach. If you think they now command some fantastic global networks, in some ways they've replaced some of the Telco international networks, all the submarine investments that tend to be done primarily for the Hyperscalers. So, they're building that out. So, as soon as you get onto their network, then you suddenly become part of that environment. And that is reducing some of the spend on the longer distances we might have got in the past approaches from the Telcos. Now, does that mean they're going to go all the way down and take over the Telcos? I don't believe so, because it's a fundamentally different business digging fiber in people's streets and delivering to the buildings, and putting antennas up. So, they will be a coexistence. And in fact, what we've already seen with Cloud and the Hyperscalers is that they're working much more close together than people might imagine. Now, you mentioned about data in the previous question, Google probably the best known of the of the AI and ML delivers from the Cloud side, working with many of the Telcos, even in some cases to actually have all the data outsourced into the Google Cloud for analytics purposes. They've got the power, the heavy lifting to do that. And so, we begin to see that, and obviously with shifting of workloads as appropriate within the Telco networking environment, we're seeing that with AWS, and of course with Azure as well. And Azure of course acquired a couple of companies in affirmed and Metro switch, which actually do some of the formal 5G core and the likes there within the connectivity environment. So, it's not clean cuts. And to go back to the analogy, those Dementors are swooping around and looking for opportunities, and we know that they will pick up opportunities, and they will extend their reach as far as they can down to that edge. But of course, the edge is where, as you rightly say, the Telcos have the control, they don't necessarily own the customer. I don't believe anyone owns the customer in this digital environment, because digital allows you to move your allegiance and your custom elsewhere anyway. So, but they do own that access piece, and that's what's important from a national point of view, from an economic point of view. And that's why we've seen some of the geopolitical activity banning Huawei from certain markets, encouraging more innovation through open ecosystem plays. And so, there is a tension there between the local Telco, the local market and the Hyperscaler market, but fundamentally they've got an absolute brilliant way of working together using the best of both worlds to deliver the services that we need as an economy. >> Well, and we've talked about this you and I in the past where the Telcos, portions of the Telco network could move into the Cloud. And there of course the Telcos all run the big data centers, and portions of that IT infrastructure could move into the Cloud. But it's very clear, they're not going to give up the entire family jewels to the Cloud players. Why would they? But there are portions of their IT that they could move into. Particularly, in the front end, they want to build like everybody. They want to build an abstraction layer. They're not going to move their core systems and their backend Oracle databases, they're going to put a brick wall around those, but they wanted abstraction layer, and they want to take advantage of microservices and use that data from those transaction systems. But the web front end stuff makes sense to put into Cloud. So, how do you think about that? >> I think you've hit the nail on the head. So you can't move those big backend systems straight away, gradually over time, you will, but you've got to go for those easy wins. And certainly in the research I've been doing with many of my clients, they're suggested that front end piece, making sure that you can onboard customers more easily, you can get the right mix of services. You can provide the omnichannel interaction from that customer experience that everybody talks about, for which the industry is not very well known at all by the way. So, any improvement on that is going to be good from an MPS point of view. So yeah, leveraging what we might, what we call BSS OSS in the telecom world, and actually putting that into the Cloud, leveraging both the Hyperscalers, but also by the way, many of the traditional players who people think haven't moved Cloud wards, but they are moving Cloud wards and they're embracing microservices and Cloud native. So, what you would have seen if we'd been in person down in Barcelona next week, would be a lot of the vendors who perhaps traditionally seems a bit slow moving, actually have done a lot of work to move their portfolio into the Cloud and into Cloud native environments. And yes, as you say, we can use that front end, we can use the API openness that's developed by people at the TM forum, to actually make sure we don't have to do the backend straight away, do it over time. Because of course the thing that we're not touching upon here, is the revenue stream is a consistent revenue stream. So, just because you don't need to change the backend to keep your revenue stream going, this is on a new, it keeps delivering every month, we keep paying our 50, 40, whatever bucks a month into the Telco pot. That's why it's such a big market, and people aren't going to stop doing that. So, I think the dynamics of the industry, we often spend a lot of time thinking about the inner workings of it and the potential of adjacent markets, whereas actually, we keep paying for this stuff, we keep pushing revenue into the pockets of all the Telcos. So, it's not a bad industry to be in, even if they were just pushed back to be in the access market, it's a great business. We need it more and more. The elasticity of demand is very inelastic, we need it. >> Yeah, it's the mother of old golden geese. We don't have a separate topic on security, and I want to touch on security here, is such an important topic. And it's top of mind obviously for everybody, Telcos, Hyperscalers, the Hyperscalers have this shared responsibility model, you know it well. A lot of times it's really confusing for customers. They don't realize it until there has been a problem. The Telcos are going to be very much tuned into this. How will all this openness, and we're going to talk about technology in a moment, but how will this transformation in your view, in the Cloud, with the shared responsibility model, how will that affect the whole security posture? >> Security is a great subject, and I do not specialize in it. I don't claim to be an expert by any stretch of the imagination, but I would say security for me is a bit like AI and analytics. It's everywhere. It's part of everything. And therefore you cannot think of it as a separate add on issue. So, every aspect, every element, every service you build into your micro services environment has to think about how do you secure that connection, that transaction, how do you secure the customer's data? Obviously, sovereignty plays a role in that as well in terms of where it sits, but at every level of every connection, every hop that we look through, every route to jump, we've got to see that security is built in. And in some ways, it's seen as being a separate part of the industry, but actually, as we collapse parts of the network down, we're talking about bringing optical and rooting together in many environments, security should be talked about in the same breath. So when I talked about Edge, when I talked about connectivity, storage, compute, analytics, I should've said security as well, because I absolutely believe that is fundamental to every chain in the link and let's face it, we've got a lot of links in the chain. >> Yeah, 100%. Okay, let's hit on technologies and competition, we kind of blend those together. What technology should we be paying attention to that are going to accelerate this transformation. We hear a lot about 5G, Open RAN. There's a lot of new tech coming in. What are you watching? Who are the players that we maybe should be paying attention to, some that you really like, that are well positioned? >> We've touched upon it in various of the questions that have proceeded this. So, the sort of Cloudification of the networking environment is obviously really important. The automation of the process we've got to move away from bureaucratic manual processes within these large organizations, because we've got to be more efficient, we've got to be more reliable. So, anything which is related to automation. And then the Open RAN question is really interesting. Once again, you raised this topic of when you go down an Open RAN routes or any open route, it ultimately requires more integration. You've got more moving parts from more suppliers. So, therefore there are potential security issues there, depending on how it's defined, but everybody is entering the Open RAN market. There are some names that you will see regularly next week, being pushed, I'm not going to push them anymore, because some of them just attract the oxygen of attention. But there are plenty out there. The good news is, the key vendors who come from the more traditional side are also absolutely embracing that and accept the openness. But I think the piece which probably excites me more, apart from the whole shift towards Cloud and microservices, is the coming together, the openness between the IT environment and the networking environment. And you see it, for example, in the Open RAN, this thing called the RIC, the RAN Interconnection Controller. We're actually, we're beginning to find people come from the IT side able to control elements within the wireless controller piece. Now that that starts to say to me, we're getting a real handle on it, anybody can manage it. So, more specialization is required, but understanding how the end to end flow works. What we will see of course is announcements about new devices, the big guys like Apple and Samsung do their own thing during the year, and don't interrupt their beat with it with MWC, but you'll see a lot of devices being pushed by many other providers, and you'll see many players trying to break into the different elements of the market. But I think mostly, you'll see the people approaching it from more and more Cloudified angle where things are much more leveraging, that Cloud capability and not relying on the sort of rigid and stodgy infrastructure that we've seen in the past >> Which is kind of interesting because Cloud, a lot of the Clouds are Walled Gardens, at the same time they host a lot of open technologies, and I think as these two worlds collide, IT and the Telco industry, it's going to be interesting to see how the Telco developer ecosystem evolves. And so, that's something that we definitely want to watch. You've got a comment there? >> Yeah, I think the Telco developer they've not traditionally been very big in that area at all, have they? They've had their traditional, if you go back to when you and I were kids, the plain old telephone service was a, they were a one trick pony, and they've moved onto that. In some ways, I'd like them to move on and to have the one trick of plain old broadband that we just get broadband delivered everywhere. So, there are some issues about delivering service to all parts of every country, and obviously the globe, whether we do that through satellite, we might see some interesting satellite stuff coming out during NWC. There's an awful lot of birds flying up there trying to deliver signal back to the ground. Traditionally, that's not been very well received, with the change in generation of satellite might help do that. But we've known traditionally that a lot of developer activity in there, what it does bring to the four though, Dave, is this issue of players like the Ciscos and Junipers, and all these guys of the world who bring a developer community to the table as well. This is where the ecosystem play comes in, because that's where you get the innovation in the application world, working with channels, working with individual applications. And so it's opening up, it's basically building a massive fabric that anybody can tap into, and that's what becomes so exciting. So, the barriers to entry come down, but I think it will see us settling down, a stabilization of relationship between the Telcos and the Hyperscalers, because they need each other as we talked about previously, then the major providers, the Ciscos, Nokias, Ericssons, Huawei's, the way they interact with the Telcos. And then allowing that level of innovation coming in from the smaller players, whether it's on a national or a global basis. So, it's actually a really exciting environment. >> So I want to continue that theme and just talk about Telco in the enterprise. And Chris, on this topic, I want to just touch on some things and bring in some survey data from ETR, Enterprise Technology Research, our partner. And of course the Telcos, they've got lots of data centers. And as we talked about, they're going to be moving certain portions into the Cloud, lots of the front end pieces in particular, but let's look at the momentum of some of the IT players within the ETR dataset, and look at how they compare to some of the Telcos that ETR captures specifically within the Telco industry. So, we filtered this data on the Telco industry. So, this is our X, Y graph that we show you oftentimes on the vertical axis, is net score which measures spending momentum, and in the horizontal axis is market share, which is a measure of pervasiveness in the dataset. Now, this data is for shared accounts just in the Telco sector. So we filtered on certain sectors, like within the technology sectors, Cloud, networking, and so it's narrow, it's a narrow slice of the 1500. It respondents, it represents about 133 shared accounts. And a couple of things to jump right out. Within the Telco industry, it's no surprise, but Azure and AWS have massive presence on the horizontal axis, but what's notable as they score very highly in the vertical axis, with elevated spending velocity on their platforms within Telco. Google Cloud doesn't have as much of a presence, but it's elevated as well. Chris was talking about their data posture before, Arista and Verizon, along with VMware are also elevated, as is Aruba, which is HPEs networking division, but they don't have the presence on the horizontal axis. And you got Red Hat OpenStack is actually quite prominent in Telco as we've reported in previous segments. Is no surprise You see Akamai there. Now remember, this survey is weighted toward enterprise IT, so you have to take that into consideration, but look at Cisco, very strong presence, nicely elevated as is Equinox, both higher than many of the others including Dell, but you could see Dell actually has pretty respectable spending in Telco. It's an area that they're starting to focus on more. And then you got that cluster below, your Juniper, AT&T, Oracle, the rest of HPE TELUM and Lumen which is formerly, century link via IBM. Now again, I'm going to caution you. This is an enterprise IT heavy survey, but the big takeaway is the Cloud players have a major presence inside of firms that say they're in the telecommunications industry. And certain IT players like Cisco, VMware and Red Hat appear to be well positioned inside these accounts. So Chris, I'm not sure if any of this commentary resonates with you, but it seems that the Telcos would love to partner up with traditional IT vendors and Cloud players, and maybe find ways to grow their respective businesses. >> I think some of the data points you brought out there are very important. So yes, we've seen a Microsoft Azure and AWS very strong working with Telcos. We've seen Google Cloud platform actually really aggressively pushed into the market certainly the last 12, 24 months. So yeah, they're well positioned, and they all come from a slightly different background. As I said, the Google with this, perhaps more data centric approach in its analytics, tools very useful, AWS with this outpost reaching out, connecting out, and as you'll, with its knowledge of the the Microsoft business market certainly pushing into private networks as well, by the way. So yeah, and Cisco, of course in there does have, and it's a mass scale division, a lot of activity there, some of the people collapsing, some of that rooting an obstacle together, their big push on Silicon. So, what you've got here is a sort of cross representation of many of the different sorts of suppliers who are active in this market. Now Telcos is a big spenders, the telecom market, as we said, a $1.4 trillion market, they spend a lot, they probably have to double bubble spend at the moment to get over the hump of 5G investment, to build out fiber where they need to build out. So, any anything that relates to that is of course a major spending opportunity, a major market opportunity for players. And we know when you need the infrastructure behind it, whether it's in data centers or in their own data centers or in the Cloud to deliver against it. So, what I do like about this as an analyst, a lot of people would focus on one particular piece of the market. So you specialize on handsets, people specialize on home markets and home gateways. So, I tend to sit back and try and look at the big picture, the whole picture. And I think we're beginning to see some very good momentum where people are, where companies are building upon, of course their core business within the telecom industry, extending it out. But the lines of demarcation are blurring between enterprise, Telco, and indeed moving down into small business. And you think about the SD-WAN Market, which came from nowhere to build a much more flexible solution for connecting people over the wide area network, which has been brilliant during the pandemic, because it's allowed us to extend that to home, but be of course, build a campus ready for the future as well. So there are plenty of opportunities out there. I think the big question in my mind is always about from going into the Telco, as I said, whether they wannna reduce the number of suppliers on the roster. So that puts a question mark against some of the open approaches, and then from the Telco to the end customer, because it goes to the Telcos, 30% of their revenue comes from the enterprise market, 60% from the consumer market. How do they leverage the channel? Which includes all the channels, we talked about security, all of the IT stuff that you've already touched upon and the Cloud. It's going to be a very interesting mix and balancing act between different channels to get the services that the customers want. And I think increasingly, customers are more aware of the opportunities open to them to reach back into this ecosystem and say, "Yeah, I want a piece of humans to Telco, but I want it to come to me through my local integrated channel, because I need a bit of their expertise on security." So, fascinating market, and I think not telecom's no longer considered in isolation, but very much as part of that broader digital ecosystem. >> Chris, it's very hard to compress an analysis of a $1.4 trillion business into 30 or 35 minutes, but you're just the guy to help me do it. So, I got to really thank you for participating today and bringing your knowledge. Awesome. >> Do you know, it's my pleasure. I love looking at this market. Obviously I love analogies like Harry Potter, which makes it bring things to life. But at the end of the day, we as people, we want to be connected, we as business, we want to be connected, in society we want to be connected. So, the fundamental of this industry are unbelievably strong. Let's hope that governments don't mess with it too much. And let's hope that we get the right technology comes through, and help support that world of connectivity going forward. >> All right, Chris, well, I'll be texting you from Mobile World Congress in Barcelona, and many thanks to my colleague, Chris Lewis, he brought some serious knowledge today and thank you. And remember, I publish each week on wikibond.com and siliconangle.com. And these episodes are all available as podcasts. You just got to search for Breaking Analysis podcasts. You can always connect with me on twitter @dvellante or email me at dave.vellante@siliconangle.com. And you can comment on my LinkedIn post, and don't forget to check out etr.plus for all the survey data. This is Dave Vellante, for theCUBE Insights powered by ETR. Be well, and we'll see you next time. (upbeat 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 nvidia wants to completely transform enterprise computing by making data centers run 10x faster at one tenth the cost and video's ceo jensen wang is crafting a strategy to re-architect today's on-prem data centers public clouds and edge computing installations with a vision that leverages the company's strong position in ai architectures the keys to this end-to-end strategy include a clarity of vision massive chip design skills a new arm-based architecture approach that integrates memory processors i o and networking and a compelling software consumption model even if nvidia is unsuccessful at acquiring arm we believe it will still be able to execute on this strategy by actively participating in the arm ecosystem however if its attempts to acquire arm are successful we believe it will transform nvidia from the world's most valuable chip company into the world's most valuable supplier of integrated computing architectures hello everyone and welcome to this week's wikibon cube insights powered by etr in this breaking analysis we'll explain why we believe nvidia is in the right position to power the world's computing centers and how it plans to disrupt the grip that x86 architectures have had on the data center for decades the data center market is in transition like the universe the cloud is expanding at an accelerated pace no longer is the cloud an opaque set of remote services i always say somewhere out there sitting in a mega data center no rather the cloud is extending to on-premises data centers data centers are moving into the cloud and they're connecting through adjacent locations that create hybrid interactions clouds are being meshed together across regions and eventually will stretch to the far edge this new definition or view of cloud will be hyper distributed and run by software kubernetes is changing the world of software development and enabling workloads to run anywhere open apis external applications expanding the digital supply chains and this expanding cloud they all increase the threat surface and vulnerability to the most sensitive information that resides within the data center and around the world zero trust has become a mandate we're also seeing ai being injected into every application and it's the technology area that we see with the most momentum coming out of the pandemic this new world will not be powered by general purpose x86 processors rather it will be supported by an ecosystem of arm-based providers in our opinion that are affecting an unprecedented increase in processor performance as we have been reporting and nvidia in our view is sitting in the poll position and is currently the favorite to dominate the next era of computing architecture for global data centers public clouds as well as the near and far edge let's talk about jensen wang's clarity of vision for this new world here's a chart that underscores some of the fundamental assumptions that he's leveraging to expand his market the first is that there's a lot of waste in the data center he claims that only half of the cpu cores deployed in the data center today actually support applications the other half are processing the infrastructure all around the applications that run the software defined data center and they're terribly under utilized nvidia's blue field three dpu the data processing unit was described in a blog post on siliconangle by analyst zias caravala as a complete mini server on a card i like that with software defined networking storage and security acceleration built in this product has the bandwidth and according to nvidia can replace 300 general purpose x86 cores jensen believes that every network chip will be intelligent programmable and capable of this type of acceleration to offload conventional cpus he believes that every server node will have this capability and enable every packed of every packet and every application to be monitored in real time all the time for intrusion and as servers move to the edge bluefield will be included as a core component in his view and this last statement by jensen is critical in our opinion he says ai is the most powerful force of our time whether you agree with that or not it's relevant because ai is everywhere an invidious position in ai and the architectures the company is building are the fundamental linchpin of its data center enterprise strategy so let's take a look at some etr spending data to see where ai fits on the priority list here's a set of data in a view that we often like to share the horizontal axis is market share or pervasiveness in the etr data but we want to call your attention to the vertical axis that's really really what really we want to pay attention today that's net score or spending momentum exiting the pandemic we've seen ai capture the number one position in the last two surveys and we think this dynamic will continue for quite some time as ai becomes the staple of digital transformations and automations an ai will be infused in every single dot you see on this chart nvidia's architectures it just so happens are tailor made for ai workloads and that is how it will enter these markets let's quantify what that means and lay out our view of how nvidia with the help of arm will go after the enterprise market here's some data from wikibon research that depicts the percent of worldwide spending on server infrastructure by workload type here are the key points first the market last year was around 78 billion dollars worldwide and is expected to approach 115 billion by the end of the decade this might even be a conservative figure and we've split the market into three broad workload categories the blue is ai and other related applications what david floyer calls matrix workloads the orange is general purpose think things like erp supply chain hcm collaboration basically oracle saps and microsoft work that's being supported today and of course many other software providers and the gray that's the area that jensen was referring to is about being wasted the offload work for networking and storage and all the software defined management in the data centers around the world okay you can see the squeeze that we think compute infrastructure is gonna gonna occur around that orange area that general-purpose workloads that we think is going to really get squeezed in the next several years on a percentage basis and on an absolute basis it's really not growing nearly as fast as the other two and video with arm in our view is well positioned to attack that blue area and the gray area those those workload offsets and the new emerging ai applications but even the orange as we've reported is under pressure as for example companies like aws and oracle they use arm-based designs to service general purpose workloads why are they doing that cost is the reason because x86 generally and intel specifically are not delivering the price performance and efficiency required to keep up with the demands to reduce data center costs and if intel doesn't respond which we believe it will but if it doesn't act arm we think will get 50 percent of the general purpose workloads by the end of the decade and with nvidia it will dominate the blue the ai and the gray the offload work when we say dominate we're talking like capture 90 percent of the available market if intel doesn't respond now intel they're not just going to sit back and let that happen pat gelsinger is well aware of this in moving intel to a new strategy but nvidia and arm are way ahead in the game in our view and as we've reported this is going to be a real challenge for intel to catch up now let's take a quick look at what nvidia is doing with relevant parts of its pretty massive portfolio here's a slide that shows nvidia's three chip strategy the company is shifting to arm-based architectures which we'll describe in more detail in a moment the slide shows at the top line nvidia's ampere architecture not to be confused with the company ampere computing nvidia is taking a gpu centric approach no surprise obvious reasons there that's their sort of stronghold but we think over time it may rethink this a little bit and lean more into npus the neural processing unit we look at what apple's doing what tesla are doing we see opportunities for companies like nvidia to really sort of go after that but we'll save that for another day nvidia has announced its grace cpu a nod to the famous computer scientist grace hopper grace is a new architecture that doesn't rely on x86 and much more efficiently uses memory resources we'll again describe this in more detail later and the bottom line there that roadmap line shows the bluefield dpu which we described is essentially a complete server on a card in this approach using arm will reduce the elapsed time to go from chip design to production by 50 we're talking about shaving years down to 18 months or less we don't have time to do a deep dive into nvidia's portfolio it's large but we want to share some things that we think are important and this next graphic is one of them this shows some of the details of nvidia's jetson architecture which is designed to accelerate those ai plus workloads that we showed earlier and the reason is that this is important in our view is because the same software supports from small to very large including edge systems and we think this type of architecture is very well suited for ai inference at the edge as well as core data center applications that use ai and as we've said before a lot of the action in ai is going to happen at the edge so this is a good example of leveraging an architecture across a wide spectrum of performance and cost now we want to take a moment to explain why the moved arm-based architectures is so critical to nvidia one of the biggest cost challenges for nvidia today is keeping the gpu utilized typical utilization of gpu is well below 20 percent here's why the left hand side of this chart shows essentially racks if you will of traditional compute and the bottlenecks that nvidia faces the processor and dram they're tied together in separate blocks imagine there are thousands thousands of cores in a rack and every time you need data that lives in another processor you have to send a request and go retrieve it it's very overhead intensive now technologies like rocky are designed to help but it doesn't solve the fundamental architectural bottleneck every gpu shown here also has its own dram and it has to communicate with the processors to get the data i.e they can't communicate with each other efficiently now the right hand side side shows where nvidia is headed start in the middle with system on chip socs cpus are packaged in with npus ipu's that's the image processing unit you know x dot dot dot x pu's the the alternative processors they're all connected with sram which is think of that as a high speed layer like an layer one cache the os for the system on a chip lives inside of this and that's where nvidia has this killer software model what they're doing is they're licensing the consumption of the operating system that's running this system on chip in this entire system and they're affecting a new and really compelling subscription model you know maybe they should just give away the chips and charge for the software like a razer blade model talk about disruptive now the outer layer is the the dpu and the shared dram and other resources like the ampere computing the company this time cpus ssds and other resources these are the processors that will manage the socs together this design is based on nvidia's three chip approach using bluefield dpu leveraging melanox that's the networking component the network enables shared dram across the cpus which will eventually be all arm based grace lives inside the system on a chip and also on the outside layers and of course the gpu lives inside the soc in a scaled-down version like for instance a rendering gpu and we show some gpus on the outer layer as well for ai workloads at least in the near term you know eventually we think they may reside solely in the system on chip but only time will tell okay so you as you can see nvidia is making some serious moves and by teaming up with arm and leaning into the arm ecosystem it plans to take the company to its next level so let's talk about how we think competition for the next era of compute stacks up here's that same xy graph that we love to show market share or pervasiveness on the horizontal tracking against next net score on the vertical net score again is spending velocity and we've cut the etr data to capture players that are that are big in compute and storage and networking we've plugged in a couple of the cloud players these are the guys that we feel are vying for data center leadership around compute aws is a very strong position we believe that more than half of its revenues comes from compute you know ec2 we're talking about more than 25 billion on a run rate basis that's huge the company designs its own silicon graviton 2 etc and is working with isvs to run general purpose workloads on arm-based graviton chips microsoft and google they're going to follow suit they're big consumers of compute they sell a lot but microsoft in particular you know they're likely to continue to work with oem partners to attack that on-prem data center opportunity but it's really intel that's the provider of compute to the likes of hpe and dell and cisco and the odms which are the odms are not shown here now hpe let's talk about them for a second they have architectures and i hate to bring it up but remember the machine i know it's the butt of many jokes especially from competitors it had been you know frankly hpe and hp they deserve some of that heat for all the fanfare and then that they they put out there and then quietly you know pulled the machine or put it out the pasture but hpe has a strong position in high performance computing and the work that it did on new computing architectures with the machine and shared memories that might be still kicking around somewhere inside of hp and could come in handy for some day in the future so hpe has some chops there plus hpe has been known hp historically has been known to design its own custom silicon so i would not count them out as an innovator in this race cisco is interesting because it not only has custom silicon designs but its entry into the compute business with ucs a decade ago was notable and they created a new way to think about integrating resources particularly compute and networking with partnerships to add in the storage piece initially it was within within emc prior to the dell acquisition but you know it continues with netapp and pure and others cisco invests they spend money investing in architectures and we expect the next generation of ucs oh ucs2 ucs 2.0 will mark another notable milestone in the company's data center business dell just had an amazing quarterly earnings report the company grew top line revenue by around 12 percent and it wasn't because of an easy compare to last year dells is simply executing despite continued softness in the legacy emc storage business laptop the laptop demand continued to soar in dell server business it's growing again but we don't see dell as an architectural innovator per se in compute rather we think the company will be content to partner with suppliers whether it's intel nvidia arm-based partners or all of the above dell we think will rely on its massive portfolio its excellent supply chain and execution ethos to compete now ibm is notable for historical reasons with its mainframe ibm created the first great compute monopoly before it unwind and wittingly handed it to intel along with microsoft we don't see ibm necessarily aspiring to retake that compute platform mantle that once once held with mainframes rather red hat in the march to hybrid cloud is the path that we think in our view is ibm's approach now let's get down to the elephants in the room intel nvidia and china inc china is of course relevant because of companies like alibaba and huawei and the chinese chinese government's desire to be self-sufficient in semiconductor technology and technology generally but our premise here is that the trends are favoring nvidia over intel in this picture because nvidia is making moves to further position itself for new workloads in the data center and compete for intel's stronghold intel is going to attempt to remake itself but it should have been doing this seven years ago what pat gelsinger is doing today intel is simply far behind and it's going to take at least a couple years for them to really start to to make inroads in this new model let's stay on the nvidia v intel comparison for a moment and take a snapshot of the two companies here's a quick chart that we put together with some basic kpis some of these figures are approximations or they're rounded so don't stress over it too much but you can see intel is an 80 billion dollar company 4x the size of nvidia but nvidia's market cap far exceeds that of intel why is that of course growth in our view it's justified due to that growth and nvidia's strategic positioning intel used to be the gross margin king but nvidia has much higher gross margins interesting now when it comes down to free cash flow intel is still dominant as it pertains to the balance sheet intel is way more capital intensive than nvidia and as it starts to build out its foundries that's going to eat into intel's cash position now what we did is we put together a little pro forma on the third column of nvidia plus arm circa let's say the end of 2022. we think they could get to a run rate that is about half the size of intel and that can propel the company's market cap to well over half a trillion dollars if they get any credit for arm they're paying 40 billion dollars for arm a company that's you know sub 2 billion the risk is that because of the arm because the arm deal is based on cash plus tons of stock it could put pressure on the market capitalization for some time arm has 90 percent gross margins because it pretty much has a pure license model so it helps the gross margin line a little bit for this in this pro forma and the balance sheet is a swag arm has said that it's not going to take on debt to do the transaction but we haven't had time to really dig into that and figure out how they're going to structure it so we took a took a swag in in what we would do with this low interest rate environment but but take that with a grain of salt we'll do more research in there the point is given the momentum and growth of nvidia its strategic position in ai is in its deep engineering they're aimed at all the right places and its potential to unlock huge value with arm on paper it looks like the horse to beat if it can execute all right let's wrap up here's a summary look the architectures on which nvidia is building its dominant ai business are evolving and nvidia is well positioned to drive a truck right to the enterprise in our view the power has shifted from intel to the arm ecosystem and nvidia is leaning in big time whereas intel it has to preserve its current business while recreating itself at the same time this is going to take a couple of years but intel potentially has the powerful backing of the us government too strategic to fail the wild card is will nvidia be successful in acquiring arm certain factions in the uk and eu are fighting the deal because they don't want the u.s dictating to whom arm can sell its technology for example the restrictions placed on huawei for many suppliers of arm-based chips based on u.s sanctions nvidia's competitors like broadcom qualcomm at all are nervous that if nvidia gets armed they will be at a competitive disadvantage they being invidious competitors and for sure china doesn't want nvidia controlling arm for obvious reasons and it will do what it can to block the deal and or put handcuffs on how business can be done in china we can see a scenario where the u.s government pressures the uk and eu regulators to let this deal go through look ai and semiconductors you can't get much more strategic than that for the u.s military and the u.s long-term competitiveness in exchange for maybe facilitating the deal the government pressures nvidia to guarantee some feed to the intel foundry business while at the same time imposing conditions that secure access to arm-based technology for nvidia's competitors and maybe as we've talked about before having them funnel business to intel's foundry actually we've talked about the us government enticing apple to do so but it could also entice nvidia's competitors to do so propping up intel's foundry business which is clearly starting from ground zero and is going to need help outside of intel's own semiconductor manufacturing internally look we don't have any inside information as to what's happening behind the scenes with the us government and so forth but on its earning call on its earnings call nvidia said they're working with regulators that are on track to complete the deal in early 2022. we'll see okay that's it for today thank you to david floyer who co-created this episode with me and remember i publish each week on wikibon.com and siliconangle.com these episodes they're all available as podcasts all you're going to do is search breaking analysis podcast and you can always connect with me on twitter at dvalante or email me at david.valante siliconangle.com i always appreciate the comments on linkedin and in the clubhouse please follow me so you can be notified when we start a room and riff on these topics and don't forget to check out etr.plus for all the survey data this is dave vellante for the cube insights powered by etr be well and we'll see you next time [Music] you

(soft music) >> Hi everyone. And welcome to this special cube conversation and kickoff preview of the Mobile World Congress Barcelona event. It's a physical event that's going to be taking place in person. It will probably be the first hybrid big event 68 days until the June 28th kickoff. You might've heard TelcoDr, Telco disruptor. Is on a mission to move the telco industry to the public cloud. And, and, and it's been taken of one of the biggest spaces this year from Erickson is the big story everyone's talking about. And of course the CUBE is excited to be there and broadcast and be a partner with TelcoDr. So I'm excited to bring on the founder and CEO of TelcoDr. Danielle Royston. Danielle great to see you. Thanks for coming on for this Mobile World Congress preview. >> Thank you so much for having me. I'm psyched to talk to you about this, its going to be great. >> So Erickson always has the biggest booth 14 years. You're disrupting the Barcelona not people's shorts going to be on or off. It's officially on, it's happening. And there's going to be a physical event we're coming out of COVID still a risky move. It's going to be a big hybrid event. It's going to be in person. Tell us the story. How did you guys come out of nowhere a disruptor take the biggest real estate in the place and turn it into a community event. A news event, immediate event, everything tell us. >> Yeah, well, you know, I think it was March 9th a little over a month ago. Ericsson announced that they were pulling out of MWC and it's very analogous to what happened in 2020. They were one of the first vendors to bail as well. And it kind of started this like tidal wave of people saying, can't do it. And I think the distinction now is that, that was at the beginning of COVID. There was a lot of unknowns, you know, is it coming? Is it not? Is it safe? Is it not? We're now, you know, year 50 to three, four months into it. I think that when you look at where we are now cases are trending down. The vaccine is up. And I think the legacy players were sort of backward looking they're like, this is a repeat of 2020. We're going to, it's not safe to go. We're going to pull out. And I'm like with a hundred days to go. And the vaccine ramping, I think I see it a different way. I think there's a really big opportunity. John Hoffman, CEO of the GSMA had put out a two page missive on LinkedIn where he was personally responding to questions about how serious they were about making sure that the event was safe and could be held. And my, my view was this is going to happen. And with Ericsson pulling out, I mean this is hollowed ground. I mean, this is, you know, a, you know, massively successful company that has customers literally trained like Skinner's chickens to come to the same spot every year. And now I get to, you know, put out my shingle right there and say welcome and show them the future , right? And instead of the legacy past and all the normal rhetoric that you hear from those you know, sort of dinosaurs, Ericsson and Nokia now they're going to hear about the public cloud. And I'm really excited for this opportunity. I think the ROI on this event is instant. And so it was, it was a pretty easy decision. I think I thought about it for about 30 seconds. >> It's a real bold move. And it's, again, it's a risk that pays off if it happens, if it doesn't, you know, you didn't happen but you're like, it's like a, it's like the the startups that put a Superbowl commercial for the first time, it's a big hit and it's a big gamble that pays off huge. Take us through, I heard, how did it all happen? Did you just wake up and saw it was open? How do you know that it was open? Was it like, does the email go out, say hey I've got this huge space for >> Well, I mean, it was big news. It was big news in the industry that they were pulling out and all the journalists were like, Oh, here we go again. You know, everyone's going to bail, who who's next right? And, and everyone was sort of like building that sort of negative momentum energy. And I'm like, we got to squash this. So I put out a tweet on Twitter. I mean, I'm not the most followed person but I'm kind of known in telco. And I was like, hey GSMA, I'll take over the booth. And I don't think people even liked my tweet, right? Like no likes no retweets. I reached out to a couple of journalists. I'm like, let's do an interview. Let's do a story. Everyone's like, we'll have you on the podcast like in a month, I'm like what?! So, so when John Hoffman had put out that letter I had connected to him. And so I was like, Oh, I'm connected to the CEO of the GSMA. So I went out on LinkedIn and I referenced the story and I said, John Hoffman, I'll take over the booth. And I think about 30 minutes later he responded and said, let's do it. And I said, great, who do I talk to? And I was in touch with someone within a couple of hours. And I think we put the whole deal together in 48. And I think wrote the press release and announced it on Friday. So happened on Tuesday the ninth, announced by that Friday. And I really, I was like, GSMA, we've got to get this out. And we got to stop the negative momentum of the show and get people to realize it's going to be different in June. This is going to happen. Let's go do it. And so I think they are they're psyched that I stepped into the booth it's big booth it's 65,000 square feet, 6,000 square meters for for the rest of the World that use it, the metric system. And I mean, that's huge. I mean, that's the size of a professional pitch in a in a football field, a soccer field. That's a one and a half football fields. It's, it's a ton of space. It's a ton of space pull off. >> I think what's interesting is there's a points out that this new business model of being connected you were on LinkedIn, you connect to them you get a deal done so fast. This is how this is the direct to consumer as a start-up you're literally took over the primo space the best space in the area. So congratulations. And, and the other thing that's notable and why I'm excited to talk to you is that this kind of sets the table for the first global what I call hybrid event. This will probably be a cornerstone case study in and of itself because we're still kind of coming out of the pandemic. People are getting vaccinated. People want to fly. They want to get out of the house, were partnering with the CUBE and the CUBE 365 platform. And, you know, we'd love hybrid. We'd love doing events, theCUBE that's what we do with video. Now, we're going to do a partnership with you to create this hybrid experience. What can people and guests who come to Barcelona or watch remotely expect? >> Yeah, so I think there's a couple of experiences that we're trying to drive in the booth. I think obviously demonstrations, you know I can't fill 65,000 square feet on my own. I'm a startup small company. And so I am inviting like-minded forward thinking companies to join me in the booth. I'm, I'm paying for it providing a turnkey experience for those vendors. And so I think what we have in common is we're thinking about future technologies, like open ran on the network side and obviously public cloud which is a big part of my message. And so first and foremost, foremost, there's, you know come and see the companies that are driving the change the new technologies that are out there and what's available for, for carriers to start to adopt and think about. MWC is a meeting intensive event. Deals are done at this show. In 2019, I think the stat is $65 billion of deals were put together at the show. And so a big component of the booth will be a place for executives to come together and have private conversations. And so we're going to have that. So that's going to be a big piece of it. And I think the third part is driving education and thought leadership. And so there's going to be a whole, you know, talk track right? Tech topics, business topics customer case studies involve the hyperscalers and really start to educate the telco community around these new technologies. But there'll be shorter talks. They won't be like hour long keynotes. We're talking 15, 20 minutes. And I think one thing that we're going to do with you as you were just talking about with theCUBE is, you know MWC was the first big show to have to cancel with COVID I think in 2019, sorry, 2020, the the dates it's always the last Monday in February and and the rest of that week. And so that's like right at the beginning of that of the COVID stuff, Italy was just starting to take off. So it was one of the first shows that had to make a big call and decide to cancel, which they did. This is going to be one of the first shows that comes back online, post COVID right? And so I don't think things just snap back to the way that they used to be. I don't think we, as consumers are going to snap back to the way that we operating we're now used to being able to get curbside delivery from any restaurant in the city, right. I mean, it's just, it's just a sort of a different expectation. And so partnering with theCUBE, we really want to provide an experience that brings the virtual people into the booth. Typically in events like this you really have to be there to see it boosts are kind of like unveiled the day of the show. What's going on. One thing I'm trying to do is really educate people about what you can expect. What can you see? This is what it's going to look like. And so we're going to start to share some pictures of the booth of, of, you know, what it looks like. Number one, to drive excitement with the partners that are coming, right. Like you're going to be part of something really, really fabulous. I think number two attendees can wait, I don't know week of to make the decision to go. And so maybe if COVID continues to trend down and vaccines are, are picking up steam, maybe they're like it's safe for me to go and I want to go be a part of that. But I think from here on out we're going to have sort of that virtual experience. It's always going to be part of shows. And so we're going to experiment with you guys. We're going to have a live streaming event over the course of the, you know, all MWC. It's going to be a way for people who are unable to travel or, you know, can't afford it. COVID or whatever, see what's going on in the booth. And it's going to be everything from listen to a talk to watch what you guys are typically famous for, your awesome interviews. We're going to have a man on the street, you know, like you know, we're here at, at a demo station, take us through your little demo. We're going to have telepresence robots that people can reserve. And, you know, cruise to the booth, the robot can go to a talk. The robot can watch on this streaming thing the robot can go to a demo. The robot can go to a meeting and it's controlled by the the virtual attendees and so experimenting, right? Like how do we make this great for virtual people? How do we make the virtual people feel part of the physical? How do the physical people feel? The virtual people that are attending and really just make it feel like a community of both. So really excited >> That's super awesome. And I think one of the, first of all, thank you for having paying for everyone and including theCUBE in that but I think this speaks to the ecosystem of open you're bringing, you're creating an open ecosystem. And I think that is a huge thing. So for people who are at Mobile World Congress in Barcelona this is going to be a nice, safe place to hang space as well as get deals done and to be comfortable doing media center, we'll get you on the digital TV, but also you're also designing the first what I call the first hybrid experience not just having people, having on-demand videos on their website, connecting Barcelona with other parts of the World, with meetings and stories and content. I think that to me is going to be a great experiment slash upgrade. We'll see, we'll get to see it. >> Well, it was really, I mean, we all lived through 2020. I mean, some of the shows went on AWS's re-invent happened. Google did like a crazy nine week program. It's very lonely to participate in those virtual events right. You know, you kind of log on by herself. No, one's really tweeting about it. You're watching, you know, an event the event is great, but it was really lonely. And so, you know, and I think what people love about the physical events is we're together and we're networking and we're meeting people. And so, you know, I think continue to evolve that experience so that virtual is not as lonely. So we'll see, we'll see how it goes. >> No, I've got to say your, your vision is really aligned with us and others that are in this open innovation World. Because if you look at like theCUBE physical went away, we had no events. We did Q virtual, a new brand. It wasn't a pivot. It was an extension, a line extension of theCUBE. Now theCUBES coming back to the physical. We're going to bring that cube virtual to connect everybody. So this is it. And it just amplifies the value of the physical event. So if done right, is so much cooler. So, so that's cool. And what I want to ask you though on the physical side to kind of bring it back to physical is there's still going to be keynotes. There's still going to be talks at Mobile World Congress. And so I saw that schedule and I just saw last week GSMA announced you're going to be doing a keynote speech. That's amazing. So how did that happen? So give us the lowdown on the keynote that you're doing. >> I'm sure the entire industry is like that happened. And it probably has something to do with the back that I have one of the biggest booths at the space. I always, you know, put in a request to speak. I feel that I have really exciting message to share with the industry. Over the last I guess it's been 9 or 10 months. I really been trying to amplify, amplify my voice. I have a podcast, I have a newsletter I'm talking to execs. I have a list that I literally go down one by one stalking each executive of like have I talked to them like how I told them about like the power of the public cloud. And so I am super thankful that I have this opportunity to spread that this message and I'm, I'm planning a really epic talk, just I really want to shake the industry. And this is, this is my opportunity, right? This is my opportunity to stand on the biggest stage in our industry. And command a presence and send out my message. And I'm absolutely thrilled to go do it. And I hope I crush it. I hope it's like a mic drop experience and can't wait to do it. >> Well, we're looking forward to covering it. And we love the open vision. We love the idea of public cloud and the enablement and the disruption, because just like you got the deal so fast, you can move fast with modern applications with the cloud moving at cloud scale, complete content, game changer, so great stuff. So totally applaud that looking forward to, and we're we're here to cheer you on and, and and ask the tough questions. I do want to get to on Twitter yesterday though, you put out on tweetstorm on Twitter, about the plans kind of teasing out the booth. How you going to plan to build the booth, are you worried that you're opening up too much of the kimono here and opened up putting too much on the table because it's usually a secret Mobile World Congress is supposed to be secret, not publicly out there. What, what's the, you know >> Well, I mean, I think this is just a little bit of a change has happened post COVID, right. You know, people usually build their booth in and don't reveal it until the first day of the show. And it's kind of like this excitement to go see what is there, what's their big message. And what's the big reveal. And there's always fun stuff. I think this year is a little bit different. So at first, like I said, at first big event back. I think I need to create a little bit of excitement for people who are going and maybe entice people that maybe you should think about coming. I realize this is a super personal decision, right? It depends on where you are and the country and your, your health and your status. But, but if you can do it I want people to know that you're going to miss out. It's going to be super fun. So, um, so yeah. >> Well, let's take it. Let's take a look at the booth though. And that's why my next question, I want to see I know we have guys, do we have that, rendering, let's pull that up and let's talk this through. Let's go look at the rendering. So you can see here on the screen, take us through this. >> Yeah. So what we want to do is give the sense of, of cloud city, right? And that's what we're calling this space in cloud cities. There's in a city there's outdoor space. Like you see here, and then there's in indoor space. And indoors is for you where you work, where you buy, where you meet. And so you can see here on the left, the demo stations that would have different vendors displaying you know, and it kind of, it goes way back. I mean, what we're feeling like I said is like a football field, an American football field and the half or a European football field a pitch it's pretty, it's pretty extensive. And so we think we're going to have, I don't know, 20 30 vendors showing their, their different software. I think we're, we're scheduling or planning for about 24 different meeting rooms that we can schedule all COVID safe with the, with the space requirements in there, but on the out in that outdoor space, it would be where you learn right. The education and then I think we're going to have this fabulous booth for the, for theCUBE. It's going to look, It's just so amazing with the backdrop of this amazing building. And, you know, I think I underappreciated or didn't really realize, you know, how devastated the both the event planning industry has been from COVID as well as construction. You know, obviously when events were shut down these companies had to lay off thousands of workers. Some of the big firms have laid off 50% of their workforce. And those people, you know they didn't just go home and sit around. They, they had to come up with a livelihood and this people have pivoted into another job. And they're not really, I mean events aren't really back yet. So some of these firms are shrunk. You know, the manpower is, is severely reduced. But then I think on the other side is and you can see this in just housing construction. There's a lumber shortage, there's a shortage of materials. And so everything that we source for the booth pretty much has to come from Spain. And so when we look at the booth, you know, we have, we have a pretty significant ceiling. Well, it looks like the roof of the building. It's an engineering feat to do. That we're still working through the sure. Someone with a protractor is doing lots of math. You know, the glass, we have those huge beautiful glass spans in the front getting a glass that spans that height. I think it's, I think it's 18 feet. It's six meters tall. That's going to be hard things like the flooring. I want to have like hardwood, laminate flooring. So it looks like hardwood floors. Don't know if we can find them right there. Like, why don't you do carpet? I'm like, can you just check one more vendor? I really want my floor. So, so we'll see how it goes. And yeah, I, I think that sharing this plan, the trials and tribulations, like how can this small startup, right? That usually, you know, take over a space that usually takes nine months to plan, right? Who is this girl? What is she doing? How are they going to pull this off? You know, I think it's like, grab your popcorn and watch the train wreck or, you know, hero's journey. We get it done. >> Well, people are on clubhouse. They're bored, they want to get out. I think this is a case study. Mobile World Congress has a huge economic impact for the, as a show it's got its own little economy built around it. Impacts the, the country of Spain in Barcelona, the city, a great city. People love it. And so it certainly is notable and newsworthy. We will be following that story. I have to ask you more of a, kind of a tactical question. If you don't mind, while I have you here, can you talk about some of the vendors that are coming and the kinds of talks you're going to have inside the booth and and how do people get involved? You mentioned it's open to people who love open ran and open public cloud, open technologies. I mean, that's pretty much everybody that's cool and relevant, which is like almost the whole World now. So like, is it going to be a space, is there a criteria? How do people get involved? What's the collaboration formula. >> Yeah, no. I had been working on putting together a list of potential vendors. You'd be surprised, not everyone is, is as bullish as I am on the public cloud. And so there was a little bit of a filtering criteria, but otherwise anyone can come right enterprise software vendors in telco where their primary customer is a communications service provider. That's their software runs on the public cloud come on in, right. People using open man. And it's still a little sort of small band of cohorts that are really trying to drive this new technology forward. And, and they're growing up, going up against some of the biggest companies in telco, right? They're going up against Huawei. They're going up against Ericcson. Both those guys are, are very anti and then not really pro open rank because it's hugely disruptive to their business. And so, you know I'm pretty sure those guys are not psyched to see open ran you know, you know, become a thing in telco. And so it's really sort of about disruptive technologies that are that are in the, in the booth. And so, yeah, I'm paying for the space. I'm paying for the, build-out bring your demos bring your people, come with your marketing message and and let's, and let's build a community. And so we're talking to open ran vendors like Mavenir. Which is a pretty big name in the open ran, open ran space. I've been talking with parallel wireless and LTO star. Those are also great players, software vendors like Totogi, which is a talk that I did a little over a month ago about this new startup that has a web-scale charger that they're trying to put out there. Aria is another company that I'm really familiar with that has some cloud for software and then little tiny startups like Zquence, and some other up-and-comers that no one's heard of. So we're really excited to invite them into the booth. I've been secretly stalking Elon, Elon Musk and Starlink and SpaceX to be a part of it. And we'll see, right. I'm kind of, you know, using Twitter and whatever I can to, to reach out and see if they want to be a part of it. But yeah, it's kind of really open arms, not really excluded. >> Oh, Elon, Elon is very disruptive and you know, he reached out on, you can reach out to him on Twitter. He's accessible. I mean, you've got to break through, but he is got this antenna up for innovators. People who think differently. They love people who break down walls and markets floor open wins. I mean, we, we know there's a history we've been covering it. I've been involved in my career. People who bet against open, always lose it's happened in every single wave of innovation. So Elons gettable, lets get him. >> Who doesn't love Elon Musk. I mean, I think some people don't, I love him, he's my hero. I model a lot of the things that I do around, around his, his approach, his vision, right, 20 years ago or close to 20 years ago, 2003 he said he was going to put people on Mars. And I think people laughed at him for being like the PayPal guy and this guy's crazy. But every year he makes progress against his goals, right. We have a real landable rocket. He's doing a manned mission this week, a second man mission or third man mission. And the guy makes progress. And I think I'm on the same, same mission here. My mission is to move telco to the public cloud. I think it's a, it's a long journey, right? I think people are like, who's this girl and she's like 12 people, and what's your story? And I'm like, I don't care. I have a singular mission is a quest. I am not going to stop until I moved the industry to the public cloud. And I it's my life's mission. And I'm psyched to do it. >> Well, we love the mojo. We'd love your style. We'd love Elon Musk, his mugshot. And again, just to bring the dots together you have that same mindset, which has, you know, as people you know, love her, love or like Elon, he's a builder. Okay, he builds things and he delivers. So as you said, so know I really appreciate the work you're doing. I love your philosophy. We're in total agreement, open, open building. Doing it together as a collective, being part of something. This is what the World needs. You got a lot of great ideas in the works and we can't wait to hear them. And what you got coming up over the next 68 days. This is the first of many conversations together. Thank you so much >> Yeah, yeah, no, it's going to be so awesome. Thank you so much for having me. Psyched to talk to you about it. >> Okay Mobile World Congress is happening in Barcelona on the June 28th. It's going to be in person and it's going to be probably the biggest hybrid event to date. Be there, check out telcoDR and theCUBE and the space that they took over 14 years at the helm there. Ericcson had it, now it's TelcoDR. Danielle Royston, founder and CEO here with me from TelcoDR. Thanks for watching. (soft music)