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Buddy Brewer, New Relic | AWS re:Invent 2021


 

(upbeat music) >> Welcome back to theCUBE's continuous coverage of AWS re:Invent 2021 I'm Lisa Martin. This is our third day here on set We've got two live sets, two remote studios, over a hundred guests on the program and a lot going on with AWS and its ecosystem of partners am pleased to welcome back one of our Cube alumni, Buddy Brewer, the GVP & GM of product partnerships at New Relic. Welcome back, Buddy. Good to have you. >> Thanks it's great to be here >> Great to be in an in-person event isn't? >> No kidding it's really amazing to see everybody out here and after spending so much time on zoom calls, we had a lot of really great moments among the team and the booth playing the game of seeing if people's height matched up with >> (laughs) >> What your expectation was because so many of the people we work with >> Never mind. >> We've only known over zoom. >> Yes ,and zoom has been a savior for all of us we've been doing so much recording on zoom at the same time it's great to be here in person and seeing what a safe job AWS has done with getting I from hearing upwards of 30,000 people in here that are here in person. So talk to me about you lead the technology partnerships at New Relic. Talk to me about your role, and then we'll get into the partnership with AWS. >> Yeah, absolutely. Well, you know, the point about zoom, it's fascinating. Like you said, that just having the ability to communicate with people has been such a key enabler of being able to make progress and to continue to lead our personal and our professional lives despite the pandemic I mean, imagine what it would have been like if this had happened 10 years ago, even, but certainly 50 years ago >> Right. or something like that, right? Like everything would have ground to a halt and technology took on such an amazing, you know, critical role in allowing us to do all of these things and so at New Relic, we're all about helping people make sure that all of this software works correctly. And so observability helps people understand the detail level about everything from the front end, the end user experience to every single piece that happens along the path of delivering that experience all the way down to the infrastructure into the network. But my role at New Relic is also to help all of the other tools that software developers use every day to create those experiences that they connect into their observability platform so that they can understand all of those details and make sure that people are able to continue doing things that have become really so basic to life like ordering groceries or getting food, or, you know, communicating with a loved one over something like zoom. >> Yeah the things that to your point, if this had happened, you know, five, 10 years ago, it would have been a completely different story. We've been able to function really well and one of the things too, that, you know, I noticed yesterday and today, you probably did as well with the plethora, typical AWS the plethora of announcements, the amount of innovation that's going on, the customer flywheel that we've just seen this acceleration of technology and what it's enabling, but the observability portion is really key you talk about, you know, the developers need to the whole SDLC they need to be able to understand exactly what's going on because at the end of the day, whether it's a consumer or an enterprise of the other end of the spectrum, we need to know exactly what's going on because people's patience is far thinner these days the pandemic showed is that there is really no having access to real-time data. Isn't a luxury anymore it's really a necessity. >> Right, yeah, absolutely. >> Talk to me about some of these so a lot of announcements coming up from AWS, you guys talk to me about the partnership, what you guys are doing there. And some of the things that are exciting on that front. >> Yeah, AWS is a really key partner for us. We're big users of AWS ourselves for our observability platform and all of our infrastructure and, you know, we've had our own journey as a 13 year old business that started out pre cloud and moving our own infrastructure to the cloud. And then along that journey, we've worked closely with AWS and we've built a lot of joint solutions to help people who are moving to the cloud themselves or who are cloud native to understand all of the details about what's happening in that software so we have over 60 different integrations to all of the different tools with Amazon that you can use on the cloud from data storage, to EKS on Fargate and all of that stuff. And then we recently announced a five-year strategic agreement with Amazon to make it even easier for customers to adopt New Relic if they're building in Amazon AWS and so you know, we're in their marketplace, we have an offering for startups, for people who are just getting started that, you know, provides really simple and fast on-ramps with discounts and things like that. That's all designed to help people, software developers in particular, focus on what matters most to them, which is building great experiences for their customers. You know, you mentioned that the SDLC and this is one of the things that, you know, our mission at New Relic is to make observability a daily data-driven habit for developers across all phases of the software delivery life cycle. The problem with observability and how it's used today is that it's only used in the run phase by most people they use it when the software is on fire to put the fire out we believe that, that telemetry has tremendous strategic value in the plan, build and deploy phases of software development as well. And so partnerships like AWS allow us to unlock the accessibility of that data across all of those different phases for people who software developers are as a result in many ways that the things that we were talking about earlier with the expectations that the pandemic has placed on how software has to work, it's not an option they're busier, they're under more pressure than they've ever been before and so we want to help them relieve that pressure with tools that help them do their jobs better. >> Relieving that pressure is key there is so much pressure on developers I mean, these days from observability to security and that sort of thing, but it sounds like one of the things that you're also fundamentally doing is really shifting that observability left and helping them from a cultural perspective, it seems like almost a shift, but you're trying to make things easier for them giving them more tools and to unlock what they're not seeing right now. >> That's right and you know, the interesting thing about it is everyone realizes that observability is critical to, you know, successful software businesses so for example, we did a survey recently of 1300 software developers and IT decision makers and executives, and found that among the C-level executives that were surveyed 80% of them expected to increase their observability budget and 20% of those expected to increase it significantly. However, that same survey found that a very small percentage of those who we actually surveyed feel that they have a mature observability practice today. And when we unpack the reasons why in the survey, we found that most of them reduce down to basically this issue of they just don't have enough time to instrument all of the software, especially in a world where the shift to the cloud has driven a change in architecture where monoliths have been torn down and replaced by hundreds, or may be even thousands of microservices. >> Right. >> And we're in an era now where if observability isn't really, really easy and incredibly fast and simple to execute on then software developers can no longer instrument fast enough to keep up with the pace of the software that they're delivering and so what that leads to is visibility gaps, visibility gaps lead to poor customer experiences. And so what we're trying to do, and we've been on this massive simplification of our own platform to make it, you know, incredibly cost-effective at just 25 cents a gigabyte for ingestion and really simple licensing seat based licensing, where you get access to all of our tools to make it really simple and to take simply minutes to get observability on all those different pieces. >> If simplicity is a word that we throw around a lot, but it's really critical element and it's interesting to understand how do you actually facilitate that? You talked about, you know, kind of the 80 20 rule there. >> Yeah. >> A lot of the organization's not on that maturity curve with observability, how does New Relic and its ecosystem of partners like AWS how do you help have those conversations within organizations in any industry tell them, understand how you can actually simplify that and unlock that visibility, knowing that it's not only a matter of software development, but it's a competitive differentiator. It's also something that can damage a brand if they're not top of it. >> Yeah, we launched a re-imagined version of our partner ecosystem really our entire integration ecosystem about six weeks ago on October 13th called New Relic Instant Observability. And one of the central goals of New Relic IO, which we call it for short is to make it take just like five minutes for people to instrument something. So in the old way, what people had to do is if they wanted observability, they had to go learn about an observability vendor then they had to go install it, figure out how all that works and then they could get to solving their problem, which might've just been simply instrumenting a Kafka you know and so what we want to do is just keep people in that mode if all you wanted to do is instrument Kafka, then go find the Kafka instrumentation tile on New Relic and observability and then there's a guided install process that takes you through that and at the end you've instrumented Kafka and if you want to add something else like EKS Fargate from Amazon, or if you want to add something else like a Java service, you can simply click more of those guidance installs and add within minutes in an incremental way without having to stop and do a whole vendor evaluation to do so in fact, one of the other things that we launched recently is a free tier that's free forever. So there's no trial process or anything you don't have to put in a credit card if all you want to do is instrument this one thing right now, you can go through this process provision a free account you get access to all of our functionality for one user and ingest up to a hundred gigabytes of telemetry data for free within minutes. And so what we're trying to do is take all of that adoption friction out so that people aren't fighting with their instrumentation so much, and again, they can get back to doing what they really want to do in the first place, which has built great experiences for their end users. >> Great experiences for the end users but that translates to employee experience that translates to an end user customer experience, which translates back to brand reputation. I'm just wondering, you know, you're focused on the developers and we've been hearing a lot about the last two and a half days, a big focus on developers has observability kind of escalated up and its evolution up the stack within organizations is this a C-suite concern? Is this a board level concern? where does this fit now? and what's the vision of New Relic to deliver on that? >> With observability? >> Yes. >> Yeah, 90% of those in the survey that I was talking about felt that observability was not just a tool that they needed to use, but strategically critical to their business and, you know, this goes back to, as we know, and especially as a result of the intensity on the importance of software coming out of the pandemic, your digital business is your business these days. And so if you don't understand what's happening in that software and you can't move quickly, then you know you're really in trouble in terms of trying to succeed in a highly competitive environment and that goes back to again, one of our core beliefs is that all of this telemetry data that people have been collecting about how their software operates is so useful in contexts outside of just when there's a problem in production. Imagine if you could take that information and you could actually put it inside the IDE, which is something that we did with a recent acquisition of a company called CodeStream. We can take this telemetry data and put it inside the IDE so that as developers are writing the software, they know where those issues are. You can click straight from a stack frame, for example, inside of our, where we show all of our errors in a capability called Error's inbox and shoot right into your IDE and go see where the line of code is that caused that error, shortening that feedback loop and unlocking this really big investment that a lot of companies make in telemetry data earlier in the software life cycle, we believe is the future of observability and we want to help people get there. >> Well, the observability is really key for organizations these days because we've been hearing every company these days has to be a data company. >> Yeah. >> And it's one thing to say that it's a whole other thing to be able to implement it and observability is absolutely critical to that as being able to take that data and apply it in different contexts to really enable that business to be digital which is absolutely table-stakes these days to be successful and to deliver that customer experience ultimately. >> Yeah. >> That's what it all do. >> Yeah, absolutely. And you know, the other thing is really hard about this problem when I talk with our customers and we found this in the survey as well, is that, you know, software developers, don't just use one tool to create software they use a lot of tools in fact, 13% of those that we surveyed use 10 or more tools. >> Whoa. >> Just for the observability piece. And so, you know, obviously we're always trying to expand organically what we do inside of our platform to cover more and more use cases, but an equally important part of our strategy, if we really want to make observability a data-driven daily habit for people is to find all of those other, you know, really well-built amazing tools that those developers use and find valuable ways to integrate with them. And so that's the other part of our ecosystem that we've built out is this ability to take all of the other tools that you use and wire them into New Relic so that, for example, if you're using, let's say Lacework for security then you can, you know, if someone's installed a Bitcoin miner on your infrastructure somewhere, you can quickly navigate because of that integration from a poor customer experience through the infrastructure that's suffering may be with, you know, a lot of memory pressure, and a lot of CPU being used for this Bitcoin miner and then find out that, you know, through the integration where the miner was installed, how it got installed so that you can remediate those types of issues and connecting those pieces together, making software truly interoperable is another thing that's really critical to our mission at New Relic. >> It is critical to not only to the developers, but to the organizations and their success as businesses these days Buddy thank you for joining me, talking about what's going on at New Relic What's new, how you're really empowering those developers and all of the downstream positive effects that, that leads to we appreciate your time. >> Thank you ,thanks for having me. >> All right, you are Buddy Brewer I'm Lisa Martin you're watching theCUBE, the global leader in live tech coverage. 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Published Date : Dec 1 2021

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and its ecosystem of partners So talk to me about you lead just having the ability to that experience all the way down and one of the things too, that, you know, Talk to me about some of these Fargate and all of that stuff. and to unlock what they're and 20% of those expected to and to take simply minutes and it's interesting to understand A lot of the organization's not on and if you want to add something else Relic to deliver on that? and that goes back to again, these days has to be a data company. that business to be digital is that, you know, software developers, and then find out that, you know, It is critical to not the global leader in live tech coverage.

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Jay Snyder, New Relic | AWS re:Invent 2020


 

>>from around the globe. It's the Cube with digital coverage of AWS reinvent 2020 sponsored by Intel, AWS and our community partners. >>Hello and welcome to the Cube virtual here with coverage of aws reinvent 2020. I'm your host, Justin Warren. And today I'm joined by J. Snyder, who is the chief chief customer officer at New Relic J. Welcome to the Cube. >>It is fantastic. Me back with the Cube. One of my favorite things to do has been for years. So I appreciate you having me. >>Yes, a bit of a cube veteran. Been on many times. So it's great to have you with us here again. Eso you've got some news about new relic and and Amazon away W s strategic collaboration agreement. I believe so. Maybe tell us a bit more about what that actually is and what it means. >>Yes. So we've been partners with AWS for years, but most recently in the last two weeks, we've just announced a five year strategic partnership that really expands on the relationship that we already had. We had a number of integrations and competencies already in place, but this is a big deal to us. and and we believe a big deal. Teoh A W s Aziz Well, so really takes all the work we've done to what I'll call the next level. It's joint technology development where were initially gonna be embedding new relic one right into the AWS management console for ease of use and really agility for anyone who's developing and implementing Ah cloud strategy, uh, big news as well from an adoption relative to purchase power so you can purchase straight through the AWS marketplace and leverage your existing AWS spend. And then we're gonna really be able to tap into the AWS premier partner ecosystem. So we get more skills, more scale as we look to drive consulting and skills development in any implementation for faster value realization and overall success in the cloud. So that's the high level. Happy to get into a more detailed level if you're interested around what I think it means to companies but just setting the stage, we're really excited about it as a company. In fact, I just left a call with a W S to join this call as we start to build out the execution plan for the next five years look like >>fantastic. So for those who might be new to new relic and aren't particularly across the sort of field of observe ability, could you just give us a quick overview of what new relic does? And and then maybe talk about what the strategic partnership means for for the nature of new relics business? >>Yes, so when I think about observe ability and what it means to us as opposed to the market at large, I would say our vision around observe ability is around one word, and that word is simplification. So, you know, I talked to a lot of customers. That's what I do all the time. And every time I do, I would say that there's three themes that come up over and over. It's the need to deliver a customer experience with improved up time and ever improving importance. It's the need to move more quickly to public cloud to embrace the scale and efficiency public cloud services have to offer. And then it's the need to improve the efficiency and speed of their own engineering teams so they can deliver innovation through software more quickly. And if you think about all those challenges And what observe ability is it's the one common thread that cuts across all those right. It's taking all of the operational data that your system admits it helps you measure improve the customer, experience your ability to move to public cloud and compare that experience before you start to after you get there. The effectiveness of your team before you deploy toe after you get there. And it's all the processes around that right, it helps you be almost able to be there before your there there. I mean, if that makes sense right, you'll be able to troubleshoot before the event actually happens or occurs. So our vision for this is like I talked about earlier is all about simply simplification. And we've broken this down into literally three piece parts, right? Three products. That's all we are. The first is about having a much data as you possibly can. I talked about admitting that transactional telemetry data, so we've created a telemetry data platform which rides on the world's most powerful database, and we believe that if we can take all of that data, all that infrastructure and application data and bring it into that database, including open source data and allow you to query it, analyze it and take action against it. Um, that's incredibly powerful, but that's only part one. Further, we have a really strong point of view that anybody who has the ability to break production should have the ability to fix production. And for us, that's giving them full stack observe ability. So it's the ability to action against all of that data that sits in the data platform. And then finally, we believe that you need to have applied intelligence because there's so many things that are happening in these complex environments. You wanna be able to cut through the noise and reduce it to find those insights and take action in a way that leverages machine learning. And that, for us, is a i ops. So really for us. Observe ability. When I talked about simplification, we've simplified what is a pretty large market with a whole bunch of products, just down to three simple things. A data platform, the ability to operationalize in action against that data and then layer on top in the third layer, that cake machine learning so it could be smarter than you can be so it sees problems before they occur. And that And that's what that's what I would say observe, ability is to us, and it's the ability to do that horizontally and vertically across your entire infrastructure in your entire stack. I hope that makes sense. >>Yeah, there's a lot of dig into there, So let's let's start with some of that operational side of things because I've long been a big believer in the idea of cloud is being a state of mind rather than a particular location on. A lot of people have been embracing Cloud Way Know that for we're about 10 or so years. And the and the size of reinvent is proven out how popular cloud could be. Eso some of those operational aspects that you were talking about there about the ability to react are particularly like that. You you were saying that anyone who could break production should be able to fix production. That's a very different way of working than what many organizations would be used to. So how is new relic helping customers to understand what they need to change about how they operate their business as they adopt some of these methods. >>Well, it's a great question. There's a couple of things we do. So we have an observe ability, maturity framework by which we employ deploy and that, and I don't want to bore the audience here. But needless to say, it's been built over the last year, year and a half by using hundreds of customers as a test case to determine effectively that there is a process that most companies go through to get to benefits realization. And we break those benefit categories into two different areas, one around operational efficiency and agility. The other is around innovation and digital experience. So you were talking about operational efficiency, and in there we have effectively three or four different ways and what I call boxes on how we would double, click and triple click into a set of actions that would lead you to an operational outcome. So we have learned over time and apply to methodology and approach to measure that. So depending on what you're trying to do, whether it's meantime to recover or meantime, to detect, or if you've got hundreds of developers and you're finding that they're ineffective or inefficient and you want to figure out how to deploy those resource is to different parts of the environment so you can get them to better use their time. It all depends on what your business outcome and business objective is. We have a way to measure that current state your effectiveness ply rigor to it and the design a process by using new relic one to fill in those gaps. And it can take on the burden of a lot of those people. E hate to say it because I'm not looking to replace any individual. It's really about freeing up their time to allow them to go do something in a more effective and more effective, efficient manner. So I don't know if that's answering the question perfectly, but >>e don't think there is a perfect answer to its. Every customer is a bit different. >>S So this is exactly why we developed the methodology because every customer is a little different. The rationale, though, is yeah, So the rationale there's a lot of common I was gonna say there's a lot of common themes, So what we've been able to develop over time with this framework is that we've built a catalog of use cases and experiences that we can apply against you. So depending on what your business objectives are and what you're trying to achieve, were able to determine and really auger in there and assess you. What is your maturity level of being able to deliver against these? Are you even using the platform to the level of maturity that would allow you to gain this benefit realization? And that's where we're adding a massive amount of value. And we see that every single day with our customers who are actually quite surprised by the power of the platform. I mean, if you think traditionally back not too far, two or even three years. People thought of new relic as an a P M. Company. And I think with the launch this summer, this past July with new relic one, we've really pivoted to a platform company. So while a lot of companies love new relic for a PM, they're now starting to see the power of the platform and what we can do for them by operationally operationalize ing. Those use cases around agility and effectiveness to drive cost and make people b'more useful and purposeful with their time so they can create better software. >>Yeah, I think that's something that people are realizing a lot more lately than they were previously. I think that there was a lot of TC analysis that was done on a replacement of FTE basis, but I think many organizations have realized that well, actually, that doesn't mean that those people go away. They get re tasked to do new things. So any of these efficiency, you start with efficiency. And it turns out actually being about business agility about doing new things with the same sort with the same people that you have who now don't have to do some of these more manual and fairly boring tasks. >>Yeah, just e Justin. If this if this cube interview thing doesn't work out for you were hiring some value engineers Right now it sounds like you've got the talk track down perfectly, because that's exactly what we're seeing in the market place. So I agree. >>So give us some examples, if you can, of maybe one or two off things that you've seen that customers have have used new relic where they've stripped out some of that make work or the things that they don't really need to be doing. And then they're turning that into new agility and have created something new, something more individual. Have you got an example you could share with us? >>You know, it's it's funny way were just I just finished doing our global customer advisory boards, which is, you know, rough and tough about 100 customers around the world. So we break it into the three theaters, and we just we were just talking with a particular customer. I don't want to give their name, but the session was called way broke the sessions into two different buckets, and I think every customer buys products like New Relic for two reasons. One is to either help them save money or to help them make money. So we actually split the sessions into those two areas and e think you're talking about how do we help them? How do we help them save money? And this particular company that was in the media industry talked at great length about the fact that they are a massive news conglomerate. They have a whole bunch of individual business units. They were decentralized and non standardized as it related to understanding how their software was getting created, how they were defining and, um, determining meantime to recover performance metrics. All these things were happening around them in a highly complex environment, just like we see with a lot of our customers, right? The complexity of the environments today are really driving the need for observe ability. So one of the things we did with them is we came in and we apply the same type of approach that we just discussed. We did a maturity assessment for them, and we find a found a variety of areas where they were very immature and using capabilities that existed within the platform. So we're able to light up a variety of things around. Insights were able to take more data in from a logging perspective. And again, I'm probably getting a little bit into the weeds for this particular session. But needless to say, way looked at the full gamut of metrics, events, logs and traces which was wasn't really being done in observe, ability, strategy, manner, and deploy that across the entire enterprise so created a standard platform for all the data in this particular environment. Across 5th, 14 different business units and as a byproduct, they were able to do a variety of things. One, the up time for a lot of their customer facing media applications improved greatly. We actually started to pivot from actually driving cost to showing how they could quote unquote make money, because the digital experience they were creating for a lot of their customers reduced the time to glass, if you will, for clicking the button and how quickly they could see the next page, the next page or whatever online app they were looking to get dramatically. So as a byproduct of this, they were about the repurpose to the point you made Justin. Dozens of resource is off of what was traditionally maintenance mode and fighting fires in a reactive capability towards building new code and driving new innovation in the marketplace. And they gave a couple of examples of new applications that they were able to bring to market without actually having to hire any net New resource is so again, I don't want to give away the name, the company, it maybe it was a little too high level, but it actually plays perfectly into exactly what what you're describing, Um, >>that is a good example of one of those that one of the it's always nice to have a specific concrete customer doing one of these kinds of things that you you describe in generic terms. Okay. No, this is this is being applied very specifically to one customer. So we're seeing those sorts of things more and more. >>Yeah, and I was gonna give you, you know, I thought about in advance of this session. You know, what is a really good example of what's happening in the world around us today? And I thought of particular company that we just recently worked with, which is check. I don't know if you're familiar with keg, if you've heard of them. But their education technology company based in California and they do digital and physical textbook rentals. They do online tutoring an online customer services. So, Justin, if you're like me or the rest of the world and you have kids who are learning at home right now, think about the amount of pressure and strain that's now being put on this poor company Check to keep their platform operational 24 77 days a week. So that students can learn at pace and keep up right. And it's an unbelievable success story for us and one that I love, because it touches me personally because I have three kids all doing online, learning in a variety of different manners right now. And, you know, we talked about it earlier. The complexity of some of the environments today, this is a company that you would never gas, but they run 500 micro services and highly complex, uh, technical architectural right. So we had to come in and help these folks, and we're able to produce their meantime to recover because they were having a lot of issues with their ability to provide a seamless performance experience. Because you could imagine the volume of folks hitting them these days on. Reduce that meantime to recover by five X. So it's just another example we're able to say, you know, it's a real world example. Were you able to actually reduce the time to recover, to provide a better experience and whether or not you want to say that saving money or making money? What I know for sure is is giving an incredible experience so that folks in the next generation of great minds aren't focused on learning instead of waiting to learn right, So very cool. >>That is very cool. And yes, and I have gone through the whole teaching kids >>about on >>which is, uh, which it was. It was disruptive, not necessarily in a good way, but we all we adapted and learned how to do it in a new way, which is, uh, it was a lot easier towards the end than it was at the beginning. >>I'd say we're still getting there at the Snyder household. Justin, we're still getting >>was practice makes perfect eso for organizations like check that who might be looking at JAG and thinking that that sounds like a bit of a success story. I want to learn more about how new relic might be able to help me. How should they start? >>Well, there's a lot of ways they can start. I mean, one of the most exciting things about our launch in July was that we have a new free tier. So for anybody who's interested in understanding the power of observe ability, you could go right to our website and you can sign up for free and you can start to play with new relic one. I think once you start playing for, we're gonna find the same thing that happens to most of the folks to do that. They're gonna play more and more and more, and they're gonna start Thio really embrace the power. And there's an incredible new relic university that has fantastic training online. So as you start to dabble in that free tier, start to see with the power and the potential is you'll probably sign up for some classes. Next thing you know, you're often running, so that is one of the easiest ways to get exposed to it. So certainly check us out at our website and you can find out all about that free tier. And what observe ability could potentially mean to you or your business. >>And as part of the AWS reinvent experience, are they able to engage with you in some way? >>It could definitely come by our booth, check us out, virtually see what we have to say. We'd love to talk to them, and we'd be happy to talk to you about all the powerful things we're doing with A. W. S. in the marketplace to help meet you wherever you are in your cloud journey, whether it's pre migration during migration, post migration or even optimization. We've got some incredible statistics on how we can help you maximize and leverage your investment in AWS. And we're really excited to be a strategic partner with them. And, you know, it's funny. It's, uh, for me to see how observe ability this platform can really touch every single facet of that cloud migration journey. And, you know, I was thinking originally, as I got exposed to this, it would be really useful for identity Met entity relationship management at the pre migration phase and then possibly at the post migration flays is you try to baseline and measure results. But what I've come to learn through our own process, of moving our own business to the AWS cloud, that there's tremendous value everywhere along that journey. That's incredibly exciting. So not only are we a great partner, but I'm excited that we will be what I call first and best customer of AWS ourselves new relic as we make our own journey to the cloud >>or fantastic and I'm I encourage any customers who might be interested in new relic Thio definitely gone and check you out as part of the show. Thank you. J. J. Snyder from New Relic. You've been watching the Cube virtual and our coverage of AWS reinvent 2020. Make sure that you check out all the rest of the cube coverage of AWS reinvent on your desktop laptop your phone wherever you are. I've been your host, Justin Warren, and I look forward to seeing you again soon.

Published Date : Dec 2 2020

SUMMARY :

It's the Cube with digital coverage Welcome to the Cube. So I appreciate you having me. So it's great to have you with us here again. so you can purchase straight through the AWS marketplace and leverage your existing AWS spend. across the sort of field of observe ability, could you just give us a quick overview of what new relic So it's the ability to action So how is new relic helping customers to understand what they need to change about of actions that would lead you to an operational outcome. e don't think there is a perfect answer to its. to the level of maturity that would allow you to gain this benefit realization? new things with the same sort with the same people that you have who now don't have to do some of these more If this if this cube interview thing doesn't work out for you were hiring some So give us some examples, if you can, of maybe one or two off things that you've seen that customers So one of the things we did with them is we came in and we apply the same type of approach doing one of these kinds of things that you you describe in generic terms. X. So it's just another example we're able to say, you know, And yes, and I have gone through the whole teaching kids but we all we adapted and learned how to do it in a new way, which is, I'd say we're still getting there at the Snyder household. I want to learn more about how new relic might be able to help me. mean to you or your business. W. S. in the marketplace to help meet you wherever you are in your cloud journey, whether it's pre migration during Make sure that you check out all the rest of

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Todd Osborne, New Relic & Josh Hofmann, AWS | AWS re:Invent 2019


 

>>LA from Las Vegas. It's the cube covering AWS reinvent 2019 brought to you by Amazon web services and along with its ecosystem partners. >>Hey, welcome back everyone. Live cube covers here at reinvent 2019 in Las Vegas. I'm John, your host extracting the signal from the noise with Stu Miniman analysts at Silicon angle, the cube and Wiki bond. We've got two great guests talking about the ecosystem and the future of software and how customers are consuming it in the cloud. Todd Osborne G VP of alliances and channels at new Relic and Josh Hoffman, GM and global lead of ISB partner ecosystem of AWS. Guys, welcome to the cube. Thanks so much for having us. So guys, we're the top story to me at this show. So far as I'll see infrastructure at scale. The software development life cycle is continuing to evolve. We are more automation, more as Andy says, heavy lifting's being done, which means that application developers are going to get more and more goodness. Dev ops created infrastructure as code check. Now we've got data, tons of data everywhere. So we're, we're seeing an ISB Renaissance more software. You guys are out there writing software. So what you guys take so far of the impact of the ISV here, Josh, to talk about that because this is a big story, does >>massive, I mean if you walk around the floor, you'll see folks that are automating new ways of doing dev ops. You're looking at new ways of securing serverless functions. Um, you're looking at new types of storage. So you could go across every category of technology in this room and you will see an incredible amount of batim innovation. Our partners are really driving that. >>Talk about the relationship with AWS, new Relic, longstanding partnership. Where is it now? Where's it going? It's, I mean, it's off the charts. So even just the last year, the amount of momentum we've built together as has been fantastic. So we participated in a whole bunch of different programs. We've got dozens, hundreds of joint customers that were doing things together. I mean, just look at this event. It's just a, it's just astonishing. We operate in a lot of different partner models, um, from, from reselling, uh, with, with various partners to building technology programs to participating, uh, with Josh and team and our friends. Uh, our friend Dave McCann and team on a eight of us marketplace. Just a whole host of different things that just continue to, to, uh, expand the partnership at scale. And the consumer is ation of the software, the procurement process she's had Teresa crossing off from public sector, whether you're in the public sector or commercial procurement still stuck in 1995 it feels like, right? >>I mean, like, are they modernizing? They've got a lot more ways to get software with the marketplace. What are you guys seeing with customers? Is it really that bad? Am I over over it? It's not that bad, but you know what I'm saying? I mean, so from my perspective, one of the cool we're seeing is, um, AWS in the cloud. Providers are driving a consolidation of budget of modern stuff, of cloud, of, of all the new things that companies want to do. That's all getting consolidated either in a new groups or new budget cycles and AWS is making it really easy to participate in those. So through programs like the marketplace, through various other other initiatives that we're doing, we can combine what we want to achieve with, with what the customer wants to achieve, which is speed to market with, which is with what AWS wants to achieve, which is faster adoption of all the different services and bringing the right ecosystem along with it. >>So the modernization of the procurement cycles along with the monetization of the technology is really cool to watch. Well, I wanted to ask that before. I want to get to the question that I'm that interested Andy Jassy his point on this keynote, Hey, this is the first time I heard him talk like this. We see two types of developers and two types of customers. People want the low level building blocks, the builders and then a new set of customers who want solutions. Yup. This is, this is your wheelhouse. This is where the solution network kind of ecosystem is evolving very quickly. Can you guys share your observations on what that, what he means by that and what does it mean for customers? >>I'll share it in the context of what we're doing with new Relic. Um, when you think of the concept of a solution, a lot of our customers, hundreds of our enterprise customers are going through our migration programs. They need help making sure that what they're doing on prem is translating to what's happening in the cloud, what the applications are doing on prem, and how they're performing in the cloud. So we've collaborated with NewRelic over the last year and a half on a number of new, not just migration programs, but windows or views into how the applications are performing. And we've designed those specifically for customers who are going through those migrations. So you just take that one little category. Um, and it's an area where we're collaborating together to bring something that is a full solution to the customer for those who are going through that migration journey. >>Your take on the whole solution thing. Yeah. So we, uh, last year at reinvent, we announced really the first solution that new Relic had ever launched trying to meet that market need and we, we announced the cloud adoption solution. So everybody knows we've got this great platform with all these cool features. We had never really gone to market and said, not only do we just address application monitoring or infrastructure mining, we actually address the business outcome of migrating to the cloud and all the benefits of doing that. So we announced that as a methodology last year. We added to that over this, this past year because we've enhanced our platform to, uh, have this new capability that we call programmability, which is the ability to write applications on top of the new Relic platform. So we've built, and we launched today a cloud adoption solution application. Kind of a mouthful. >>But what it is, is it is, it's the ability to use our technology and our platform to very easily drop that into a customer and help them very quickly get time to value of delivering on a solution and ultimately achieving the business outcome they're looking for. Yeah, I taught actually. So as you know, I was at your conference earlier this year in New York city where you really defined what a platform should be. And just like Amazon, what you want is you want builders and you want them putting solutions on Dabo. It gives a little bit of the momentum of what you've seen since new Relic one, and then the rollouts. So I don't know the formal count, but I know we're way past the dozen applications that we launched since then. Uh, we also added several different features including logging and some other technologies. We've closed a bunch of different deals with these new technologies since then. >>Um, and then a couple of the cool things from the partner ecosystem that we've done is with the platform capabilities we have, uh, firstly we're now, uh, getting ready to embark on building our first technology partner program. So we were talking to dozens of different partners in this room about how they can build with us on new Relic to make the platform even stickier, uh, for our customers that can now integrate NewRelic with various other technologies. And then the second, uh, thing we were proud to announce today is we've, we've actually just signed a three new managed service providers. So kind of another partner motion that we're driving in this ecosystem. And the new, all the new features of the neurotic platform helped enable us, uh, to do some really cool things with the platform and also evolving business model, uh, to close. Uh, so we were excited to to close three, top 80 best partners, which is best been global, uh, uh, blaze clan and out of California mission cloud as three new partners that we, uh, just, uh, signed agreements with. >>So we're happy to do that. Yeah. When we talk about the transformation, you know, one of the biggest challenges for customers is their application portfolio. I noticed new Relic has two boosts here. There's one specifically just focused on serverless, which I think is awesome. It's got some cool things. They're very focused on that developer app dev deployment there. Um, but you know, your customers, they've got a broad spectrum of applications and that journey to transformation in a modern nation is going to take time. How do you deal with the spectrum of what they're dealing with? But Todd, maybe start with you and then Josh would love your viewpoints too. I mean the spectrum. Massive. So our biggest challenge is keeping up with everything and continuing to innovate with all the things that are happening. But again, the benefits of the platform that we have enables us to do that in the enhancements. >>We wait and we made this year, this year. Um, now that our platform is, is more open, we can connect data, collect data from multiple entities, not just the new Relic, uh, agents that we've, that we were built on. So, uh, the concept of observability and being able to observe the entire application environment, um, is built on the fact that data's gotta come from all these different places. Then we need to turn that around and curate it, uh, into the right experience and the right use case that the customer's looking for. So, uh, all I can say is that, uh, our, our company is built on innovation. We try and stay on the cutting edge of all that. Try and stay current with that and meet the customer's needs as, as everyone here is innovating like S easy at scale. Todd, talk about what's going on in New York. >>What's the coolest thing going out with new Relic right now? Cause Lou always comes on the Q lose to CEO and he's cool. We love him, but he's always got his hands in something. Yes, he got the observability down. Cloud operations becoming standard. That's a tailwind for you guys as a company. But what cool things are you guys working on right now? Um, I certainly can't do Lou any justice. So the customer stories and things and he comes up with are amazing, but you know, from an industry's perspective, like gaming is hot. Um, and it's just like media and entertainment is hot. So we're just doing some really cool things with some really cool customers. Um, maybe not as cool as Lou would be, but you know, customers like, uh, are really adopting our migration story and we're really driving some significant business together. So customers like world fuel services and fleet complete, uh, we've recently come out and announced the stories of how we're helping these companies migrate. >>And frankly that's what's, that's what's cool about it is like everyone wants to get on the cloud faster, do more faster, and we're, we're enabling that, uh, in some really cool customers. So I'll to get your both reactions just to memes that we're developing on the cube this week. One is called, one is cloud native. If you take the T out, it's cloud naive. Okay. So, and the other one is something that I use on my post when my Andy story I did was you got born in the cloud, which is clear benefits. There's no, there's no discussion there. Check winning builder, but reborn in the cloud as companies are becoming reborn, this isn't the Mike, not just migration. There's a fundamental mind shift shift. Yeah. This is a reborn enterprise. And if you're not be born in the cloud and you're probably not going to be around longer, that seems to be the message. What's your reaction to cloud native without the T and reborn in the cloud? >>Well, I think it's, I think it's an accurate statement. It's funny. It's the first I've heard it. I may steal it. If I can use it, please pass it on. I will. Um, I would say that from an APM perspective, many of our partners are in different phases of their journey. Um, and so everything that we do is around three anchor points, which is helping those companies build great software if they haven't already, or if they're making that transition. Once they've made that transition, how do we help them market the software? And then the third piece is really how do we help them sell it? So in the case of new Relic, um, we've got a number of folks around the world that are helping with that co-sale process based on the solutions that we've jointly defined. Um, and then we also help build out the channel because as AWS, we've got tens of thousands of consulting partners. So the idea when you talk about that journey of becoming cloud native is how do you help a partner through that? You've got to hit on all three of those pillars to do it right. The leadership's got to be there for the top. Totally. You've got to have board alignment. You've got to have executive sponsorship, you've got to have technical buying, all of it. >>You guys have a very savvy customer base, Bray cloud native observability. What is the naivety uh, um, issue? What are people mostly naive about? Cause if you don't do it right with instrumentation observability if you're naive about that, you're going to get bitten in the, you know what? Well being, being naive there is not having your observability platform in place. So, but, but you really can't anymore. The old world of if you had a monolithic application running on servers monitoring, sometimes it was optional or a nice to have something today. You couldn't, you could only afford on your most mission critical applications as soon as you flipped a dev ops, a bunch of cloud native technologies, um, modern applications, but on the most modern frameworks with entities that are, that have all these dependencies to make sure that application works. Monitoring is a must, must have an observability is a must have. >>So that's now even in day one, out of the box, out of the one and two, the in to the reborn comment. As soon as you cross that path, you report, you rebirth yourself every day. Like it's constant. You're releasing code daily or multiple times a day, and so there's no like reborn statement anymore. It's a completely agile process. System changeover. This is not just saying it. You got to really believe what you're doing. You have to measure improvement, which is what new Relic is great at because if you take what's happening now on premise and you go to that transformation, you've got to show that you've actually achieved not just savings, but you're helping developers be more efficient and so you, you can't prove that story without the before and after. Yeah, yeah. Love talking to the cloud native gurus that you guys are, congratulations on your marketplace and ISV success. It's only getting the beginning of that run. It's kicking butt. Congratulations. Hundreds of thousands of customers are buying and hundreds of thousands more talk congratulates a new rule. Always great to have you guys on X. Great, impressive company, great results. Always great team, great product cloud, native ashore. Props to that. Thanks for coming on. Appreciate shit. Thanks so much. I'm John here in the cube, extracting the signal in the noise day. Two of three days of wall-to-wall coverage. Two sets here on the ground. Thanks for watching. We'll be right back.

Published Date : Dec 5 2019

SUMMARY :

AWS reinvent 2019 brought to you by Amazon web services the impact of the ISV here, Josh, to talk about that because this is a big story, So you could go across every category of technology So even just the last year, I mean, so from my perspective, one of the cool we're seeing is, So the modernization of the procurement cycles along with the monetization of the technology is really cool to I'll share it in the context of what we're doing with new Relic. So everybody knows we've got this great platform with all these cool features. So as you know, I was at your conference earlier this year Um, and then a couple of the cool things from the partner ecosystem that we've done is with the platform But again, the benefits of the platform that we have enables us to do that in the enhancements. into the right experience and the right use case that the customer's looking for. So the customer stories and things and he comes up with are amazing, So, and the other one is something that I use on my post when my Andy story I did was you got born in the cloud, So the idea when you talk about that journey of becoming cloud native is how do you help a What is the naivety uh, You have to measure improvement, which is what new Relic is great at because if you take what's happening now on premise

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Lew Cirne, New Relic | New Relic FutureStack 2019


 

>> Narrator: From New York City, it's theCUBE, covering New Relic FutureStack 2019, brought to you by New Relic. >> Hi, I'm Stu Miniman and this is theCUBE at New Relic FutureStack 2019 here in New York City. It's our first year of the event, but the event itself has been around for seven years and to help us end our coverage, no better person than the founder and CEO of New Relic, and the one who the name of the company came from, Lew Cirne. Of course, Lew Cirne is an anagram for New Relic. >> Indeed it is. >> Lew, thank you so much for having theCUBE at the event here and thanks for hosting us. >> I'm a huge fan of theCUBE. I've been watching it for a long time and it's such a pleasure to have you guys here. Thank you for coming. >> All right, so Lew, you're known as the coding CEO >> Lew: I am. >> And you come out with a vision of making software better. It's a great goal. Give us a little bit about the state of the industry. You know the internet challenge these days. It's going to fragment into a bunch of pieces and Open Source isn't what it used to be. There's so many changes going in the industry. Just kind of macro view before we get into New Relic. >> Yeah, from a macro view at New Relic we do this for the love of software. It's not just me, it's the whole company. We believe in software. We think it unquestionably is changing the world, transforming every industry. It's not enough just to build software that's great. You have to deliver more perfect software. That's now become almost obvious whereas when we first started out that was actually a bit of an evangelical sale where we had to convince people that they needed to observe their software. Now it's become a must-do thing, and that's why observability has become a household term. Everybody recognizes that anything that runs in production in internet scale needs to be observed, needs to be measured in real time. And so, that's been going on and has become a must-do thing for our customers. What we're so excited about is that we're delivering the first observability platform. What do we mean by that? Well, we see with this proliferation of tools, you might have metrics going to one place and logs going to another place and traces going to Zipkin or logs going to Elasticsearch. You want it all in one place, and more important, you want it to be connected so that you can see the relationship between the application and its server or infrastructure and the user experience all in one connected platform. That's what we're delivering with New Relic One today that's so exciting. >> Yeah. So, Lew, the IT industry in general is known for its fragmentation. >> Lew: Yeah, it is. >> When I want to build my application in the old days, I talk to the CIO. He's like, "Give me a million dollars and 18 months "and I will build you the Taj Mahal of my application." And we've got it beautifully designed and pull it out. Well, today things are moving much faster, but I've got everything from that Taj Mahal to the Kubernetes and Serverless, Microservice Architectures-- >> Lew: All that compartment-based stuff, yeah. >> There's usually a lot of different teams, and a lot of different tools in there. How does New Relic fit across that landscape and how are you helping to pull things together? >> Well, certainly the industry's moving from the monolithic application to the component-based application, often running in smaller and smaller services, usually running in something like Kubernetes or a containerized environment and with that comes a proliferation of things to monitor, and often a proliferation of tools. We have enterprise customers that have 20, 30 different monitoring and telemetry tools. It's not because they want it, it's because there might be one particular feature that one tool does that gives them the visibility they need. And what they want is a single platform. What people have historically used New Relic for is dropping our agents into their application or their infrastructure. Then our agents automatically put visibility in and then they report on the health of that system. We do that really well, but what we're announcing today is that we're opening up our platform to consume telemetry from Open Source, agentless sources. So that, if you've got something like Prometheus that's gathering data from Kubernetes, that can go straight into New Relic and be treated as first class data, so that you don't have to switch between a bunch of tools. None of our customers want that. They want it all in one place, but they need an open platform that's connected and most importantly programmable so that they can actually have one tool to see it all. And that's New Relic. >> A lot of the logging and tracing information out there isn't agent-led. What do you see as the future of agents, and what are some of the challenges of pulling all of these various data types together? >> Well, the most important thing for the future is that our customers have complete control in a choice. What we see particularly in large enterprises is they want both. They have a portfolio of more than a thousand applications. They want to observe them all. Most of them they'll want to drop an agent in because they don't have time to reinstrument them, but they still need to see them. Some of them they may want to manually instrument because they want a higher level of control or they want to adopt an Open Source API like OpenTelemetry. But then, if they're adopting that for some of their portfolio, when a transaction reaches across these different services, you don't want to lose visibility. We're delivering best of both worlds. You can manually instrument what you want. You can use OpenTelemetry in parts of your environment. And then you can also use our automatic instrumentation that comes from our agents. Our customers get to decide, and that's the future. >> So, Lew, you've laid out the case in a strong way as to why New Relic One should be the platform for the monitoring observability. I think you undersold a little bit the NRDB piece. When I look inside my business or I talk to customers, being able to see my data and act on my data can be challenging. You showed a demo of 10 terabytes and being able to change it in a snap. >> You know, NRDB is pretty magical. At some risk, let's see if this will show up on my phone right now. Just give you a sense of how fast NRDB is performing right now. Okay. One more time. So we've got-- >> Hold it up a little bit and show the camera this way. >> NRDB right at this moment is inserting 18 million events every second. Every second, 17.89 million pieces of data coming into NRDB in real time. And our customers are querying that in real time. Right now, in this moment, they're reading 24 billion pieces of data per second. Those pieces of data could be log messages. They could be someone pressing something on their app, could be a request going through a server. It's all in the same database. And the last one is a hundred millisecond response time on those queries, which is mind-blowing for these analytics queries. >> You actually showed the press an analyst this at lunch and it was over 20 million-- >> I think it was at 40 billion at that moment. >> 40 billion coming out and the same response time. A hundred milliseconds is Google good as to how fast I get a response. >> For this kind of data processing, it's mind-blowing. Now, the thing that our customers need to know is that all your metrics, all your events, all your logs, all your traces going into the same database with one query language. That's so much better than going to Elasticsearch and using its query language for logs, then using a totally different query language for getting at your metrics, and then trying to stitch it all together. We put it all not only in one cloud but in one database. That is the most powerful telemetry database in the world, which is NRDB. >> Lew, give us a little bit of the journey to the announcement today. Observability's been talked about in the industry for a while. VC money has been pouring into startups. There's been some acquisitions in this space already. Give us a little bit as to how we got to today. >> So how we got to today was when we started off as a company, we were championing the whole idea of observability, putting visibility into application code. As I said, that was a bit evangelical in the early days. People were wondering if they needed it. Now there's no question they need it. In fact, some people need it so badly they want complete control, and so they're manually instrumenting. OK, I've talked about that. Now where we see people going is now that all of this telemetry data is coming ideally into one place like New Relic, our customers are saying, "I need to go beyond dashboards. "Dashboards are good, but often dashboards are incomplete "to get the most out of the data we're collecting." That's why we're claiming we have the first and only platform for observability, with a capital P. What do I mean by that? It's only a platform if you can build software on it, and New Relic One is the first software development platform for observability applications. Our customers can take all this data and build real-time applications that leverage all the value out of it. When a customer buys something online, New Relic's database could be the first piece of, certainly, analytics database that sees that data. So you could a navigation that shows real-time sales for your business people all based on New Relic One. We can also solve all sorts of IT operations problems by building applications on this platform. And to prove it out, we're offering 12 free Open Source applications to anyone. They can download, they can clone them off of GitHub and push them into their New Relic account and they can use that as inspiration to build their own applications on top of our platform. >> Right. This is, if I understand, the first twelve, and you expect both New Relic and your customers will build many more. >> Yes, and actually it's thirteen already. We just added another one today. Some of those have been built by our customers already, and we're already seeing customers deploying these applications into their New Relic One accounts in production today. >> It really goes back to the promise of SaaS is that when customers need something and make a change or build on it, it's not just that customer that gets to be able to leverage that, but everybody else that is on the platform-- >> They can share and benefit. The way to think of it is, you're absolutely right, and without Force.com, Salesforce is just a CRM system. But with Force.com, companies could really leverage all the data inside Salesforce. Without programmability, ServiceNow is just a ticketing system, right? But how does ServiceNow become strategic? By allowing people to build applications tailored to their business. We believe the world needs an observability platform and the only one of its kind is New Relic One. >> All right. So, Lew, it sounds like this should be something that should accelerate growth for the company going forward. I read through your last earnings report. You're growing at 30, 35%, which is reasonable but less than the overall cloud marketplace itself is growing. So, how come the AWS, Azure, GCP tailwind isn't pushing New Relic faster? >> Well, it is a good tailwind for us, and I can't go into too much detail. We're a public company in a quiet period so I can't speak to specifics. What I can tell you is history has shown that people tend to adopt platforms at a certain rate and then, a few years later, they adopt the management technologies for those platforms. So we tend to be a little bit behind the adoption of cloud but then when people standardize and they go all in on it, then they really increase their investment in New Relic. I believe that things like our platform capabilities take our customers that might be spending... We have 850 plus customers that spend more than 100,000 a year with New Relic, and I believe when they start to adopt our platform and go strategic with us, many of them will be million-dollar customers, and that ought to be the basis of durable growth for the company. >> All right. So, Lew, there was some news leading up to the event. Some management changes. Let you speak a little bit of that, and you've got some history with, of course, Mike was already on the board, but-- >> We're so thrilled about Mike Christenson joining the company as President and COO. I've known Mike since 2006, when he acquired my last company, Wily Technology, which was really the very first APM company. Mike was the President and COO of CA, and so he had a similar role there to what he has here. Mike is, I think, one of the most brilliant operational minds I've ever met. He's been involved with New Relic for nine years. He's been one of the first investors in the company. He's been on our board of directors, and he's always had a keen mind for how to think about growing our business. I've been thinking for a long time on how to get him more involved as a member of the team and finally I convinced him to come join. Mike joined us as our President and COO. He's going to be my partner in growing the business. I think those that know me know that I love technology and products and thinking about where we are five years from now. Mike will be my partner to help make sure we're operating the company and growing the business on a day-to-day basis. >> Lew, you and your team helped create and democratize this wave of APM, Application Performance Management. As you look at it today, we talked about microservices. You talk about the dispersed nature of everything going on. How would you reframe the market today and New Relic, where it needs to be today and going forward? >> Phase 0 was people-monitored servers, back in the Stone Ages. Monitoring was just "Is the server up or down "and does it have enough CPU?" >>Blinking lights. >> Right. Then came APM. APM really was the precursor to observability. It was the notion that these are complex systems. They need to be observed at high granularity. APM gave birth to observability, so when New Relic first came along, we're "Let's democratize APM." And as observability came along, we saw this as an opportunity to open up the platform. Now where we are, if you look at our track record, first of all, my first company created the category of APM. New Relic then democratized APM, and now we're delivering the first observability platform. I believe that the future is programmable, and that New Relic is the future. >> Lew, you've always been enthusiastic when it comes to the vision that you put out, but it's been noted by some of my peers that your energy level and enthusiasm is even higher today than usual. So many things that you talked about, some of the things that you highlight, maybe behind the scenes, or things that might get missed beyond the headlines that you want to share. >> The idea for New Relic One was born two years ago. I took some of the brightest people in New Relic offsite and we fleshed out the thinking and the early prototype of what's become this. This is my life's work. This company's my life's work. I believe so much in this platform. I believe in its capabilities. I'm seeing our customers ripping it out of our hands, saying, "This is going to enable us "to fully achieve our goal of complete visibility "and completely tailored to the needs of our business." Why I'm so fired up and passionate is when you put your heart and soul into something that's new, that no one else has done before... There's been a handful of times I've done that in my life. The first time became APM. The second time became New Relic. The third was when I created NRDB. And now the fourth is New Relic One. And we're just getting started. >> Well, Lew, I want to let you have the final word as to what you want your customers taking away here from FutureStack 2019. >> My belief is that the future of observability is you need a platform. That platform needs to be open, connected, and programmable. We have such a beautiful, easy... It's a Heroku-like developer experience. So within seconds, you can be building an application that takes the telemetry data in New Relic and turns it into actionable business insights for your company. And if you want inspiration, there's 13 applications now up on GitHub that you can install right into your New Relic account, and maybe modify and tailor to your needs and republish to share with our other customers. >> I know you and your team are making sure that New Relic doesn't become a relic of the past. Thank you so much for having us here-- >> We're always in the future. >> And congratulations. I look forward to watching the progress going forward. >> Thank you, I enjoyed it. Thank you. All right, bye-bye. >> Thank you so much. And that's a wrap theCUBE's coverage of New Relic FutureStack 2019. I'm Stu Miniman, of course. Go to theCUBE.net for all of the coverage. A big thanks to the team here and everyone supporting and as always, thank you for watching theCUBE. (Electronic Music)

Published Date : Sep 19 2019

SUMMARY :

brought to you by New Relic. and to help us end our coverage, at the event here and thanks for hosting us. and it's such a pleasure to have you guys here. There's so many changes going in the industry. that they needed to observe their software. is known for its fragmentation. I talk to the CIO. and how are you helping to pull things together? so that you don't have to switch between a bunch of tools. A lot of the logging and tracing information but they still need to see them. and being able to change it in a snap. Just give you a sense of how fast And the last one is a hundred millisecond response time 40 billion coming out and the same response time. Now, the thing that our customers need to know to the announcement today. and New Relic One is the first software development platform and you expect both New Relic and your customers and we're already seeing customers and the only one of its kind is New Relic One. but less than the overall cloud marketplace and that ought to be the basis of durable growth and you've got some history with, and so he had a similar role there to what he has here. and democratize this wave of APM, back in the Stone Ages. and that New Relic is the future. some of the things that you highlight, and the early prototype of what's become this. as to what you want your customers taking away and maybe modify and tailor to your needs that New Relic doesn't become a relic of the past. I look forward to watching the progress going forward. Thank you, I enjoyed it. and as always, thank you for watching theCUBE.

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Nadya Duke Boone, New Relic | New Relic FutureStack 2019


 

(electronic music) >> From New York City, it's theCUBE. Covering, New Relic Futurestack 2019. Brought to you by New Relic. >> Hi, I'm Stu Minamin and we're here at New Relic's Futurestack 2019 in the middle of Manhattan. Right next door to Grand Central Station at the Grand Hyatt. Right next door to Grand Central Station at the Grand Hyatt. Happy to welcome to the program, first time guest, Nadya Duke Boone, who's the vice president and general manager of application monitoring here at New Relic. Thanks so much for joining us. >> You're welcome, it's great to be here. >> All right, so, a lot of announcements this morning. Of course, observability front and center Lou talking about how that fits into this space. You have handled really kind of the APM product inside New Relic, so I'm hoping you can help us understand kind of the journey that New Relic's going on. And I've heard in the marketplace, you know, there's AI ops, and there's observability in all of these things. And, you know, APM was the old world for the monolith. So, you know, how does New Relic help live across all of these environments that customers are living in today, and you know, undergoing so much change and new things? >> So as Lou talked about this morning, we think to be an observability platform like New Relic 1, you've got to be open, connected and programmable. That is, we think about that within the application monitoring space, um, we really think it comes down to the matter and issue of like, what are the questions you need to ask. And that really depends on like what stacks you need to see and what are the questions you need to ask. And so, I think it's a false dichotomy to say you need to like, pick a side in observability or monitoring. I think it's really a yes/and. You don't have to pick a side. And with New Relic, what we're able to do whether using our agents and all the rich data they give you or they're using our open platform, the important thing is that we're able to bring it all together in one place. So you can get all your questions answered. >> Yeah, I spent lots of time in my career trying to help break down silos. You know, the traditional infrastructure world, the networking and storage and compute teams. >> Sure >> You know, virtualization helped pull some things together. Software tends to be a unifying factor, but when I look at, you know, the people that own application and the developers. I mean, you've got monoliths, you've got this containerization in microservices coming. You've got the new serverless environments here. You've got a lot of fragmentation inside the customers. How does that impact your business today and are we going to see those, you know, pulled together over time? >> Yeah, what we hear from customers is that, you know, they're going to be running heterogenius environments for a long time. If you're over a year old company, you're not running a single tech stack. You've made choices for your business needs and you need to be able to see across your whole estate. And where New Relic's adding value for our customers, is by bringing this all together and connecting it. So, you can actually see, let's say from a lambda function and our lambda agents, all the way back through your Java monolith and down to the server whether it's running containers or on bare metal, you can see all the way down. And then you can connect it out to you front end as well. And I think it's that ability to see across, is where we're playing. >> All right, uh, can you bring us inside your customers? What are some of the challenges they're facing? And how do you help them along those transformations that they're undergoing? Cause, as you've said, they're going to have this heterogenius environment for quite a long time. >> Yeah, well I think one of the thing they're saying is that they're trying to move faster. And one of the ways they're moving faster is by changing the process by which they build software. So, you know, we've been talking about DevOps for years. We've been talking about Agile for much longer than years. Um, but those changes bring about new needs also, for observability. Cause now, you've got a team that maybe wants to see very deeply with, um, the things they're on call for. But software refuses to break neatly at team boundaries. It just won't, it's going to break wherever it wants to break. So you need to be able to quickly assess, across your whole enterprise what's going on and help those teams talk to you. So, that's definitely a problem we're solving for our customers now. And if I were to pick one more, that I'm hearing, um, well, I'll pick one from this morning and that's cost management, right. As people move to the Cloud, um, its so powerful and easy to be able to start up new services in the Cloud but then, do you know what you have, do you know what is costs, do you know how to optimize? Um, we announced 12 new applications this morning. One of them is addressing exactly that point. >> Yeah, um, okay, what are some of the challenges customers have really monitoring across these different environments? I think cost, it's, well, the promise of Cloud is to help me understand and control my cost quite a bit. But, you know, I understand my data center cost and, in general, much more than I do what I have in the Cloud. >> So, you mean, trying to understand in their software? >> So, I guess, just, if they have these different environments that need to span from a monitoring standpoint what are some of the challenges that customers have and the differences and how does New Relic pull those together for them? >> Well, I think some of it is bringing their teams together. If you've got folks that have a Dev accent and an Ops accent, they may have different points of view about monitoring right? And so, a Dev team might be saying lets go all in on this method or this tool. But an Ops team might be saying something else. And then as you introduce new technologies and maybe now people don't always want to run an agent. They want to have complete visibility over their software. And so, with New Relic, we're giving them those choices. We're giving them, like, hey, you can run an agent, you can, if you've already got stuff at Zipkin, cause maybe, internally, you've got like a great Zipkin champion. Like, great, we're going to be there with you on that too. So, we want to be able to help these teams come together. Um, rather than forcing them to sort of live in silos. >> All right, uh, Lou put a real emphasis talking about platform. And he said platform with a capital 'P'. >> Yeah >> Help us understand a little bit about that and the impact that's going to have for your customers. >> Yeah, absolutely, I think, you know, anyone can say I've got more than one product, therefore I have a platform I think. When we talk about a Platform, we think of software engineers, a Platform is something I can build on. So, I think a capital 'p' Platform is the ability to build apps, to be able to extend it, to be able to add data because you're open. Um, and then the power that we bring, you know, I got to put in my plug, is by connecting it all together. Um, but I think the power of the Platform, um, has been really showing off in the work that we've been doing with our customers to build these new applications. >> All right, um, you mentioned open, which was one of the three features of the Platform itself. Uh, there's open and with API'S and then there's open source can you help us tease through a little bit because there's the openness and then there's some open source pieces. How do those go together and um, I guess, more importantly, what does it mean for the customers? >> Mhmm, thanks for asking, cause I do think those words kind of got tumbled up. So, let's first, let me like tease it apart a little bit. So, first part of open, you sort of already mentioned this, is like, we're open to all data. So, metrics, vents, logs, traces, you can send that data. That's, that's the first thing. You don't have to be running a New Relic agent to use New Relic. The second part though, uh, is that we are actually building and contributing to the open source community software development kits and exporters to make it easy for our customers. And so, we've shipped, we're shipping Open Census and Drop Wizard and Micrometer and exporters and Prometheus scrapers so that these are open source tools that our customers can get, can extend if they need to, to get that data in. So, we're making it easy to get the open data in by providing these open source tools. Um, and we're in there with the communities contributing to the communities as well. And then, finally, you know, the last one is with our new programmable Platform, we are also all in on open source on that. So, we're contributing to open source for folks building on New Relic and our customers are telling us that they're excited to also be able to do that and to share and exchange with each other. >> There's value to the customer and I guess the question is, your relationship with your customer is going to change though. As they're building applications not just, you know, more than just a tool. And I've heard from many of the customers that use New Relic, is, they talk about the partnership. And it really is taking that partnership to the next level. What I say is, New Relic is not coming out and saying oh, we're an open source company and we're building our company around open source. So, you know, it seems that somewhat a maturation of the model but not open source being the be all and end all of New Relic's mission. >> Our mission is to help customers build more perfect software. I mean, that's why we come to work. Is to help them do that and we think this is the right step. Um, to be able to do that and our community around New Relic, as you said, is excited and dynamic. It's great to be here at Futurestack and hear them talking to each other and hear the buzz. I was at our customer advisory board meeting yesterday which is 11 execs from some of our biggest customers and they were talking about how excited they are to see how this is going to help them with their business cause they can connect, now their telemetry data to sort of higher order business problems. Um, and they're also excited to share. So, I think it's the right step for New Relic and our customers. >> There's a lot of startups out there that attack pieces of what New Relic's trying to deliver. Um, you know, how does New Relic look at the landscape out there and the challenge when you're trying to be a platform is, are you providing good enough solutions? Or, you know, are you providing, you know, best solutions across all of these environments? >> Yeah, I think any of our point solutions could go head to head with anything on the market. Um, you know, and the fact that the market is so dynamic is because it's a real problem space for people who are building software. So, folks are going to keep innovating and coming up with new ideas and my mission is to make sure that everyone writing software, is instrumenting it and able to observe it. So I think, I love that more and more folks are joining this conversation. I think it's a great time to be working on monitoring observability. >> Okay, uh, let's start at the top talking a little bit about observability, what should customers be looking at, should they be thinking about that? What feedback are you getting from some of your key customers? Uh, in the space in general and how New Relic's looking to address it? >> Yep, well I think comes down to, a little bit of what we talked about earlier, visibility and answerability and if I were talking to an exec or if I was talking to an engineer, and I was looking at their tools, you know, whatever level you're at and saying, what do you need to monitor how can you get that data in and can you answer the questions? Do you have the tools, the ability to query, to connect the data. Um, to see, hey there's an event that happened and how did my systems change? So I think a lot of it comes down to, is it visible, can I ask the questions? And then for every stack, and no matter what job I'm doing. >> All right, um, when we look at this broad term which gets overused some, but, digital transformation Um, the comment I've made is the long pole in the tent of going through that transformation, really is the application portfolio. You know, I can modernize my platform, I can go to Cloud, but, you know, changing my applications, especially the ones that run my business, is really tough you know. If I'm a company that's been around 15-20 years, you know, I probably have applications that are as old as the company, if not longer. >> Yep. >> Uh, just broadly, how are your customers doing, uh, are they being able to kind of, you know, move along that modernization journey of the application uh, better today than they might have a couple of years ago, or just kind of macro level? >> I think so, I think, you know, between what the Cloud vendors are doing and what we're doing, folks are getting both tools and they're also getting support. I think, you know, the community, the software engineering community is really leaning into this moment. And talking about how to do these types of trasnformations. So I think there's a lot of just, knowledge sharing going on, there's a lot of advice and consulting that you can get. And then I think the tools are lending themselves to being able to do, you know, some people move to the Cloud or lift and shift. Some people use it as an excuse to re-architect. A lot of folks pick and choose. Because not every apps work the same and some apps are, you know, are, um. For some given app, it might be a more relevant time to change it, a more relevant time to let it stay put and you can make those choices. And I think people are approaching it with a certain rational sense. >> Yeah, uh, one last question for you, New Relic's a leader in, according to, the analyst firms that look at the APM market. New Relic's doing a lot of the things that I hear from, you know, the startups getting lots of money thrown at them, so, how should customers think of New Relic today? >> I think, we're the best leading APM product on the market for a reason. And we can never rest our laurel. So I think customers should at us as a trusted partner. Who's going to continue to grow and meet them wherever they are. Our customers are going to Cloud, we want to be there first to meet them there and welcome them in the door. And that comes back to how do we help customers through digital transformation? We're a big software company. We get it, like, we are going through the same, we go through these same questions ourselves. Um, and we talk to our customers all the time. So I think for our customers, it's like, we're the platform and the right partner. Because we're never going to stop. >> Nadya, thank you so much for sharing the updates. Congratulations on the launch today and, uh, best of luck going forward. >> Thanks a bunch. >> All right, lots more here at New Relic Futurestack 2019, I'm Stu Minamin, thanks for watching theCUBE. (electronic music)

Published Date : Sep 19 2019

SUMMARY :

Brought to you by New Relic. Right next door to Grand Central Station at the Grand Hyatt. And I've heard in the marketplace, you know, And so, I think it's a false dichotomy to say you need to help break down silos. and are we going to see those, you know, and you need to be able to see across your whole estate. All right, uh, can you bring us inside your customers? and easy to be able to start up new services in the Cloud But, you know, I understand my data center cost Like, great, we're going to be there with you on that too. And he said platform with a capital 'P'. and the impact that's going to have for your customers. Um, and then the power that we bring, you know, All right, um, you mentioned open, which was one of And then, finally, you know, the last one And it really is taking that partnership to the next level. Um, and they're also excited to share. Um, you know, how does New Relic look at Um, you know, and the fact that the market and saying, what do you need to monitor I can go to Cloud, but, you know, to being able to do, you know, I hear from, you know, the startups getting And that comes back to how do we help customers Nadya, thank you so much for sharing the updates. All right, lots more here at New Relic Futurestack 2019,

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Roger Scott, New Relic | New Relic FutureStack 2019


 

>> Narrator: From New York City It's theCUBE covering New Relic FutureStack 2019. Brought to you by New Relic. >> Hi, I'm Stu Minimen and we're here at New Relic's FutureStack 2019 at the Grand Hyatt, next to Grand Central Station, here in New York City. Happy to welcome to the program a first time guest, Roger Scott who's the Chief Customer Officer at New Relic. Roger, thanks so much for joining us. >> Thanks, Stu. Thanks for having me on. Good to be here. >> Alright so, I love this morning actually in addition to hearing all of the announcements, my first hand full of guests on theCUBE were customers. So I got to hear from them and we know your team is always excited about the announcements, but definitely enthusiasm from the customers, things in the keynote that got people. >> Fired up! Yeah. >> Clapping, and fired up. >> Great to see. >> Things like, oh wait! 10 terabytes of data, pressure thing, refresh for like a second, and >>oh my gosh! There's results. Yeah >> Pretty impressive so maybe give us a little bit of insight into customer engagement and how it's let to the bevy of announcements here at the show. >> Oh it's a great question actually and I think in my capacity as Chief Customer Officer and the functions I'm responsible for, we're continually engaging with customers as you can imagine. And one of the things we take a lot of pride in is being a proxy for the voice of the customer back into the organization. So we have a pretty rigid process. Not rigid, a pretty discipline process, I would argue, that allows us to get feedback from the field, listen to our customers, understand what's important to them, and reflect that in our product roadmap. And I'll let you know that's on a weekly cadence we do that. Now we're not doing that in a reactive fashion such that our roadmap diverts every single week in there, but we hear that constant feedback from the field as to what our customers are lacking. So lot of what you hear today, in terms of those six great announcements that we have were a combination of feedback that we've had over the last couple of years, I would argue. Because it's a dramatic shift to go from what we were previously, which was essentially six individual products that work really well together. But through the release of New Relic 1 in May earlier this year and what we announced today has truly developed us in to a observability platform. So monitoring with six different products to a true observably platform that's open, connected and programmable is a dramatic shift. And that's a combination of a bunch of feedback from our customers over the years. >> Yeah. I'm sure it's pretty much feedback from all customers. They're not asking for more tools and more interfaces and more things that they need to learn. >> Roger: Not at all, right. >> In many ways software can be a unifying feature especially that term platform who spend a bunch of time emphasizing what's needed from platform. >> Maybe, what were your costumers struggling with that kind of New Relic 1 in general is looking to solve as well as the observability piece? What went into that launch that was costumer pinpoints and things that they'd been asking for. >> Yeah maybe to stand back a little bit and understand some of the challenges that costumers had and then why they were asking for different solutions or evolution of our solution. If you think about today's world, there's this rapid development an deployment of software, so it's almost got to the point of continuous software deployment. And so your speed of needing to be able to react to problems in your environment, your costumer experience are degrading, ect. Being able to respond to that really quickly is essential, understanding the costumer experience is essential. You talked about operational efficiency of reducing the number of tooling sets or data sets that I'm looking at continually. So anything that we could provide to our costumers that allowed them to get to answers quicker, understand the why, and then be able to remediate that really easily so that the costumers have a greater experience. And at the same time reduces this friction that's unnecessarily introduced when you're going from one product to another, one tool to another and you're spending too much time rationalizing data sets across those tool sets. So consolidation is a big theme, ability to get to your answers really quickly is a big theme and that's really been the genesis of being able to create a platform. But not just a platform for consolidation, for better visibility, and observability but we believe it's not truly a platform until you can develop on it. If you think back in technology history of all the different peradams we've had throughout the history of technology, those who've won the platform wars over the years have been really good at being able to provide tools and ease of adoption of the platform by virtue of being able to build things on top of it. The ability to give people tools that allow them to build technology is really a therasense of the platform as well. >> You know, Roger, there's a certain trust level that costumers have to have if they're going to be building on top of your platform. >> When I've talked to costumers in New Relic they do talk about a partnership >> and the good back and forth but there's definitely a certain amount of stickiness once they've built something on your platform. >> Roger: Right, yeah. >> Any concerns from them as to, you know there's that term lock in out there as to the how do I know that this is going to work for me, and that I'm not going to have my pricing kind of crank up over time and be like oh my gosh, a year or two later, what did I get myself into? >> Right. It's a really important point that I'd like to start off by actually reemphasizing the point you made. I think we pride ourselves on the relationship we have with our costumers. It truly is the heart of everything at my organization does. We have this saying that we are because they are. In the realization that if we don't serve our costumers really well they have choices frequently, we're a saas vendor, the contracts come up for renewal frequently. And if you're unable to deliver on the promises that you made in the sales process, once they implement your solutions and try to use those in production, environments and everyday work if you can't deliver on those promises then you're going to breakdown that level of trust. And trust is at the center of all relationships as you know. Whether it's a personal relationship, you're playing on a sports team, whether you're working with your costumers. And so we want to make sure that we can deliver on those promises once we've sold them the product. So I haven't heard any specific concerns about lock in or anything, I think what they regularly come to us though with is they want us to have a really strong point of view, want us to be opinionated, tell them how this should work effectively together, what does best practice look like, what's the gold standard, what are some of the artifacts, tools, frameworks, reusable templates that we can share with them that accelerates their time to value. So I think the value significantly outweighs the concerns around lock in or reduction of the number of vendors that they're working with. >> If I look at really the enterprise space, you've got costumers working through their application modernization. They've got their modelist their going after micro services. I heard a stat that only about five to ten percent of apps are monitored at the app level today. >> Yeah, pretty scary, isn't it? >> Yeah, how many of your costumers are dealing with the installed state versus new deployments and what are some of the challenges you're hearing from costumers there? >> Yeah and I think it's important to pause that number because I think it's five to ten percent or growing to twenty percent as I think got indicated. If you look at those organizations Born In The Cloud or Born Digital it's significantly higher percentage of that which is possibly an indictment of the low level of instrumentation we see in a lot of legacy software technology stacks. And so I think in today's world we're tryna get that level of instrumentation observability up as much as possible. But maybe to link back to your previous question as well I think there's an important aspect here of when we move to a platform. When you're a product company your differentiation comes through product, comes through the capability of that product features and functions and we've certainly found ourselves in a significant number of those battles against competition where it's feature and function based. That's not a great comfort for the costumer. I think when you move to a platform it's very much around the networks differentiation. When I say network differentiation I think it's about getting the users of your service access to third party applications to third party data sources be they open source data emitters, opentelementry, open sensors, Zipkin any of those data sets that we are now in support for today. Giving them access to those data sets and being able to enrich the experience that we provide them that network effects and that's really where we see the opportunity to deliver significantly more value to our costumers with the ability to then build your own applications on top of the platform. That's second to none in the industry in my opinion. >> Roger, what's New Relic's role in helping costumers as really they're modernizing their work force? When I talk to so many companies it's like they need to retrain and they have to have new skill sets they need to make sure as certain cloud in automation changes where they focus on things and embrace devops and new ways of doing things. There are a lot of challenges there. Where does New Relic play in that modernization for costumers? >> You know what I think it's in a couple ways. The ways that we, my organization, can help the costumer in terms of just sheer understanding of the capability of the platform, what are best practices, how we can drive better accountability as you move to these new technology stacks and new ways of working much more agile environments. And so I think we can do a combination of that just sheer skills development, working really tightly with the likes of AWS you would've heard Dave McCann this morning talking about how when costumers migrate the application work goes to the AWS cloud environment. Hopefully they're not just doing that by way of compute lift and shift but they were actually looking at modernizing and refactoring those applications and when they do that, you heard Dave talk through a number of assets and frameworks and models and reusable best practices that we're trying to work with them on that we can give to our costumers that accelerate their journey 'cause it's not easy. We were talking to Chris Dillon this morning from Cox Automotive and when you think of an organization like that that's forty, fifty years old and has had to transform itself in terms of digital experience for it's costumer base, it's a significant cultural adjustment quite often to get teams to work in fundamentally different ways. So it's not an insignificant challenge but that's partly why we've invested so heavily in costumer success. Taking the costumers on the journey, thinking about their maturity over time, and constantly look for them to get better value from the platform. >> Roger, there are a number of things that have jumped out at me. Things like oh hey, we can save you potentially millions of dollars on your AWS cloud bill. You've already got costumers building on top of the platform, you had the future Haka event just a couple of weeks ago. Any other kind of interesting or exemplary costumer outcomes that you might be able to share? Either doesn't have to be about the new stuff but just that you've recently with your costumers. >> You know, one of the things that's most gratifying for me when talking to costumers is when we've been able to see when you work with older, more traditional companies that are undergoing some form of digital transformation and they're trying to shift a lot of the applications into a more modern stack and environment, become more agile, etc. they frequently sort of peel off part of the business and will have a digital division that will build some innovative, typically mobile based, apps. We've seen a number of different retailers that we've worked with. Number of different travel organizations where we've started out intrumenting the mobile application because they've built a new application to give their consumers or costumers access through to their services, and at some point that application is going to merge into the backend and have to connect back into older technology. And it's been the beauty of being able to connect those two different environments together. Not starting off at what we would've got as slightly easier place to start which was the more modern application environment where we are really well suited to. But then seeing the full value of being able to instrument the front end all the way through to the backend, link that back to the costumer's experience and to the impact on the business in terms of funnel analysis from number of people using the mobile application to actually ordering something to once they've ordered it, feeling satisfied in actually receiving the goods that they ordered. Being able to instrument all of that and understand the impact of performance and availability on the overall business arcam, that's when it's been truly transformational in working with costumers and that's certainly where we'd love to help more of our costumers in that fashion. >> Alright, Roger, want to give you the final word. Of course you bring together a number of costumers here at FutureStack in the U.S as well there's a few of those run in other geographical areas but throughout the year, any other key things you want to highlight as to how costumers can get engaged even more. >> Yeah, I mean, we've got a sort of what I would argue is a tiered approach to costumer success. At the very high end of our engagement model we have a significant number of resources. Solution architects, costumer success managers that we can deploy directly with our costumers. We typically do that in conjunction with them, build out success plans, etc. What we looking at investing Heavily at the moment is also having a good understanding of what the ideal costumer journey is like. Realizing that a costumer can come to an event like this and learn about our product but the best way for them to experience that is in the course of using the product. So heavy focus on product lead growth and how we actually deliver better value through the product itself, remove friction and adoption and getting to better value. We want to automate some of that costumer journey so that we know that if you've just signed up and, for instance, you've configured you're agent and you've done your learning policy but you haven't yet configured a custom apdex on that application or you haven't understood what your key transactions are, we've got all that data in the backend. So we're working really hard to understand how we get that information back out to costumers and go hey we know you haven't necessarily done this yet, here's some access to great assets. A short video clip, a self paced learn guide that somebody can get on demand from an LMS system. So trying to use a combination of direct resource investment, events like this where it's great to make announcements like we did about the six grade innovations and then increasingly using digital through the products but also through just the general costumer journey to say hey this is really important content and information, you should look at this now 'cause it's going to add value in what you're doing today. >> Alright, well Roger Scott, Chief Customer Officer at New Relic, thanks so much for joining us. >> Thanks so much, it's been great talking to you. >> All right. I'm Stu Minimen back with lots more here at New Relic FutureStack 2019 in New York City. Thanks for watching theCUBE. (outro music)

Published Date : Sep 19 2019

SUMMARY :

Brought to you by New Relic. at the Grand Hyatt, next to Grand Central Station, Good to be here. in addition to hearing all of the announcements, Yeah. oh my gosh! and how it's let to the bevy of announcements Because it's a dramatic shift to go from what that they need to learn. of time emphasizing what's needed that kind of New Relic 1 in general is looking to solve that allowed them to get to answers quicker, that costumers have to have if they're going and the good back and forth that I'd like to start off I heard a stat that only about five to ten percent of apps and being able to enrich the experience that we provide them to retrain and they have to have new skill sets and constantly look for them to get better value of the platform, you had the future Haka event just a couple that application is going to merge into the backend of costumers here at FutureStack in the U.S as well Realizing that a costumer can come to an event like this Chief Customer Officer at New Relic, in New York City.

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Buddy Brewer, New Relic | New Relic FutureStack 2019


 

>> From New York City It's theCUBE covering, New Relic FutureStack 2019 brought to you by New Relic. >> Hi I'm Stu Miniman and this is theCUBE's coverage of FutureStack 2019. Happy to welcome to the program, first time guest, Buddy Brewer, who's the GVP and GM of client side monitoring with New Relic, going to talk about customer experience and especially the digital customer experience. Buddy, maybe explain for audience who may not know client side monitoring tell us as to where that fits in to the entire picture of new relic. >> Yeah for sure great to chat with you Stu. You know client side monitoring for us, is the part of our observability platform that extends all the way out to where the user actually is. So people think of New Relic as this really great platform for understanding everything that is going on in the application logic, and the servers, but our client side monitoring does is extend it all the way out to the phone that is in the consumers hand or the laptop that's right in front of them. >> Stu Miniman: All right so obviously there is a direct connection between that and that digital customer experience. Maybe explain some of the challenges there and how new relic is helping to work on solving those. >> Yeah you know, digital customer experience is all about collecting and understanding the relationship between two different types of data. There are the technical metrics, all of that information about how long people are waiting, latencies and pieces of the software everything from how long it takes to connect to the server, how long it takes to build the response to the web page, Deliver it, render it, all that stuff. There's lots and lots to collect on the technical side. But the other half of DCX is the personal side, the human side. The person who is on the receiving end of all that stuff, how's it affecting their behavior? How long are they spending on the site? Are they buying? Are they clicking on a second webpage? Are they engaging in the game? Are they booking that travel reservation? And so collecting all of those business metrics, and then collecting right next to them all of the technical metrics and bring that back in a way that you can understand the relationship between those two things is what DCX, digital customer experience is all about. >> Yeah it is fascinating the expectation that we have today in 2019 is so different then the past. It used to be like "Okay, I know if a website doesn't load in this long, they are going to leave me" But you know what are those expectations, what is that ultimate end user. What is a good customer experience for them? >> Buddy Brewer: Yeah it's changing all the time, and it changes depending on what part of the world people are in, it changes depending on the type of device and this is why it is important for customers to actually collect the information and understand their relationship with their customers. It's really hard to put a single number on it. Because what's true for a commerce site, might not be true for a media site. What's true for a site in Australia, might not be true for a site in The Americas, or in the UK. There are certain patterns that certain people have seen, Google had a statistic out awhile ago that said that over half of people will leave a mobile site that takes longer than three seconds to load. And so there are some patterns out there, but a big belief, for us, is that one of the most important relationships our customers have, is the relationship with their customers. That is why it is so important for them to collect their own metrics around how long people are waiting, and how that waiting is affecting their behavior. >> Stu Miniman: Yeah, so it seems obvious that you know having data to back up what's going on is important. Bring us inside a little bit the importance of monitoring in this space though. >> Yeah, absolutely and this is why it's so important. We are so excited to be talking about our observability platform that we have here today at FutureStack. The fact that it's open, you can bring all of this information in. We've got all of this agent technology that collects things about what's happening in the servers what's happening in the info structure, information that's happening on the client side. As well as this ability to absorb information from third parties, then connecting it all together to give you that context. So there is the context that is being solving problems from the front end to the back end of the application stack. There is also the context like we were talking earlier, the digital customer experience. The connection between the technical metrics and the human metrics, and how they are actually experiencing the application. And then making all of that stuff, the connected stuff, programmable. So then our customers were the first observability platform that you can actually build applications on top of. And so we've released twelve of those today that folks can use. It's going to continue to expand, and it's something that our community can contribute to, our customers can actually take our visualizations, and our analytics and customize them to do exactly the things that they need to do. >> Stu Miniman: All right, Buddy observability is still a relatively new term for a lot of people. Help us dig down, you actually did a blog post even, about, you know, the principals of observability and modern applications. What, how should customers be looking at observability and how do they sort between you know, what is a good solution versus, you know, an okay solution? >> Buddy Brewer: Yeah, well there are some really important pieces that we think people need if they want observability about what's happening in their application. It starts with getting all of that information in one place. You know we have this really fast database, in our DB that store all of the telemetry that we collect on behalf of our customers. And it's getting larger and larger as we continue to open that up to things like these third party data sources. Then there is context that is really important to layer on top of that. Bringing the information together in ways that start to make sense out of those little individual pieces. One of the things that we found though, is that our customers are running applications that are so complicated, there is so much going on in these applications today, that even with the context there is still forty or fifty things that are happening at the same time when a customer has an issue. That's where our applied intelligence, which is another piece of what we are launching today at FutureStack, comes into play so that you can take those things and condense them down into smaller more manageable related chunk of information that folks can act on and fix their applications. >> Stu Miniman: Yeah, it was actually really impressive to see, you know, in the demo this morning, being able to poke through and get meaningful results off of tens of terabytes of data. In, I would say, much faster than I can run a report on the industries leading CRM tool where all of our customer data lives today. So you know, pretty interesting stuff is to how you can enable customers and it kind of almost will change the expectations as to what a good experience is like. >> Yeah that's right and you think about how there's that use case of things where normal and then they got bad, and so you logged in and diagnosed to get things back to normal. And having that speed, that ability to get that information quickly is really key there. There's also a whole other use case, this is the digital customer experience user case, where things are normal, but we want our customers to be able to play offense with software. To be able to take what's normal for them today, and to get better and better and better in ways that drive better business outcomes for them and allow them to compete and win in a space where, consumer expectations are just getting tougher everyday. >> Yeah, you know always look at there. How can, how can you just, you know, exceed what customers expecting and give them so that they will, you know, love your solution even more because you gave them more than expecting? How's New Relic helping customers, you know, move along that journey. >> Yeah, you know nobody likes to be kept waiting. At the end of the day the customer always has a unified view. So we want to give our customers, the consumer always have a unified view, we want to give our customers the unified view with all of the details. So that they can deliver a better experience for their customers. And it has to do with, again like I was saying collecting the technical information, also collecting the information about how that's affecting customer behavior and then looking at those two things next to each other in context. So that they can see how one affects the other. >> Stu Miniman: All right so, Buddy give us some of the outcomes that customers will see based on the announcements, today at the show. >> Buddy Brewer: Yeah so for the customer experience, one of those programmable pieces that we launched is this really simple application that you can just drop in to New Relic and it shows you right away the difference between engagement when people are getting good experiences, versus when customers they are getting bad experiences. And when we show this to people often times they are shocked. For example take a metric like bounce rate. What's the likelihood that someone who comes to your site is going to stay on your site? When people think about it, usually they are thinking about it in aggregate, across the entire site. But when you separate it out into the good experiences, and the bad experiences, maybe you've got an overall bounce rate of forty-percent, but when you give those really fast experiences to your users they are only bouncing at twenty-percent, so they are twice as engaged. Then conversely the folks who are getting the bad experiences, because let's be honest on any given day, websites are, you know delivering good and bad experiences to different groups of users, that bounce rate might be seventy-percent. And when you see the disparity between these two things it's a motivator to action. Now what's really important after that is that you've got the data underneath so that you can actually do something about it. And that's where this end to end observability platform that collects all of the information from the front end to the back end is so useful. >> Stu Miniman: Yeah, I have to think that it's pretty powerful not just for the customer experience, but I can get accountability from my partners, so where it be my ISP or my cloud provider, I can be like "Hey, uh, you promised me this response, this bandwidth and here's the data, we need to make sure that I'm actually getting what I'm paying for" >> Yeah that's right and at the end of the day what the customer saw, what our customers customers, the consumer at the end of that connection sees, is the truth. And so collecting that data, whether they are on a mobile device using an application or they are using a browser. Any of that stuff. Having that information is not only useful for internal accountability, and things that are in peoples direct control, but also absolutely, there's so many, so many third parties that people are using, to make their application's go today. >> Stu Miniman: Yeah, we know the visibility of actual data to help us not only make decisions but, inform everything that we doing is so critically important today. All right Buddy, why don't you give the final word, digital customer experience. What do you want people coming out of FutureStack 2019 here in New York City, really understanding? >> Yeah, I think that when it comes to New Relic, it's that we providing folks the ability to have exactly the view that they need of all of the data that's relevant to the performance of their application. So that they can solve technical problems, so that they can solve business problems. Because at the end of the day, your digital business is your business increasingly. The digital experience is what defines peoples brands. And so we want our customers to have complete control and visibility over all of that. >> Stu Miniman: All right, Well Buddy Brewer thanks so much for joining and sharing what's going on with New Relic and that digital customer experience >> Thanks so much Stu. >> All right, little bit more left here at FutureStack 2019, I'm Stu Miniman and thanks for watching theCUBE. [Outro Music]

Published Date : Sep 19 2019

SUMMARY :

brought to you by New Relic. experience and especially the digital customer experience. observability platform that extends all the way out to where Maybe explain some of the challenges there and But the other half of DCX is the personal side, Yeah it is fascinating the expectation that we have today Buddy Brewer: Yeah it's changing all the time, Stu Miniman: Yeah, so it seems obvious that you know from the front end to the back end of the application about, you know, the principals of observability and modern that store all of the telemetry that we collect to see, you know, in the demo this morning, being able to speed, that ability to get that information quickly and give them so that they will, you know, love your the consumer always have a unified view, we want the outcomes that customers will see based on platform that collects all of the information from the Yeah that's right and at the end of the day what the everything that we doing is so critically important Because at the end of the day, your digital business FutureStack 2019, I'm Stu Miniman and thanks for watching

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Todd Osborne, New Relic & David McCann, AWS | New Relic FutureStack 2019


 

>> From New York City, it's theCube covering New Relic Feature Stack 2019. Brought to you by New Relic. >> Stu: Hi, I'm Stu Miniman and this is theCube's first year of coverage at the seventh year of New Relic's Futurestack 2019 here in New York City and happy to welcome back to the program two Cube alumni. So, Todd Osborne is the GVP of Alliances and Channel with New Relic and Dave McCann is the Vice President of Migration Services, Marketplace and Control Services with AWS. Gentlemen, thanks so much for joining us. >> Dave: Great seeing you again, Stu. >> Todd: Thanks for having us. >> Allright, um, Todd, let's start with you uh, you know, quite a bit of a relationship with, between New Relic and AWS. I know we've had Lou on our program at the AWS shows a couple of times. So, set us up with the, the partnership and how it's been evolving. >> Todd: Yeah, it's been a, uh an unbelievable partnership, um, for many, many years we've worked together starting with technology integrations, we've got dozens of them that, that natively monitor a bunch of different AWS services but the most exciting thing of late ah, really came to life middle of last year when we started working with, uh, a bunch of different folks at AWS. Our, basically, our biggest thing that we need help with is migrations. We know we have this massive opportunity, uh, to, for more and more applications more and more workloads to move to the cloud. There's lots of different ways in which customers, partners and Amazon needed help in doing that. They brought us several different challenges related to that and we responded by, ah, at Reinvent Launch last year, launching what we call the Cloud Adoption Solution. That really was how, um, a process that linked up with the Amazon Migration Acceleration Program and used New Relic as the platform to help with migrations from beginning to end. So, starting with the planning, uh, phase of the process, getting the information you need to have a successful migration and design a successful migration, troubleshooting that may, of anything tat may occur during the migration and then post migration, really helping to optimize the performance and cost of how that migration, uh, or that post migration, ah, optimization and run phase. So, it started with that. It's really evolved. What's been really amazing, just since we launced last November December at Reinvent, the whole, we've seen a massive shift already, just the last nine months, where it's not about just simple lift and shift anymore, almost all customers that are migrating now, are also thinking about modernizing their software stack, running on containers, using kubernetes, running micro services, which is New Relic's sweet spot, really, at the application space. So, as we've evolved, starting with migration, evolving into modernization, it's been an amazing partnership working with AWS. >> Stu: So, Dave, migration services, obviously something we hear a lot about from AWS. Every time I go on one of these shows, it's one of the key steps that gets thrown out. Uh, you have a very broad ecosystem, the marketplace, uh, you know is, is the closest I call to the kind of the enterprise app store, uh, of today. Tell us what's, you know, special and, really, you know the effort that goes together between AWS and New Relic here. >> Dave: So, I think, from a migration point of view, um, you know we've spent a lot of time in AWS designing a migration methodology. Our professional services team, let by Tom Weatherby is really delivering a playbook directly to our customers on how to migrate. And, also, we've certified over fifty consultant partners who are certified to do the migration. But all the migrations hinge on a customer knowing what they have and whether they want to migrate it. And, so, to necessarily know what you have, you have to go through application discovery. So, if you've got a larger server fleet, you've got four or five thousand instances, you have a thousand apps, you've actually got to discover and analyze what you have. And, clearly New Relic's tool is widely installed. So they actually have the visibility to a lot of the installed apps. So, last year, at the end of last year, we bought a Canadian company called TSO Logic. And TSO Logic is a business case tool from building the business case on whether to move an application running on PRIM. What would it look like on The Cloud? So, we need to have that data in the tool. And, so, New Relic's been a great partner, integrating New Relic into TSO Logic, so we cal actually take the instrument in visibility that New Relic brings to the table and pop it right into the tool. And, so, the New Relic, TSO tool integration is a great new mechanism that we have. And we just acquired TSO in Q1 of 2019. So that we're now giving the TSO tool to all of our solution architects and all of our consulting partners and New Relic feeds the data right into the TSO tool. So that's a huge, um, uh, mechanism for accelerating migration. >> Okay, uh, can, can you speak to, you know, how, are you, who and what customers and how are you targeting them, uh, for, for this solution? >> So, first of all, customer are moving to AWS. You know, thousand of enterprises are moving applications. I think you have to assume that most enterprises are moving to The Cloud. And the question is, "At what speed?" So, as our sales teams engage with the customer, the sales team have a notion to discuss migration we run migration methodology. And so, as we engage with the teams, the solution architect brings TSO to the tool, to the discussion. And that's happening all around the world. And we've trained our solution architects on TSO. And as we've done that, the second thing we've done is, you know, New Relic engineered engine marketplace over two years ago. But we've launched a new capability called Private Offers. And Private Offers is where the customer, while they're planning the migration, may also need to license more New Relic and New New Relic. And, so, how do we make licensing really easy? And, so, New Relic worked with us on, the, what we call the Private Offers Workflow. And that Private Offer Workflow allows a New Relic sales executive to generate the quote right in the marketplace portal. And you, an AWS customer, and you receive that private quotation right in your AWS account. So not only are we business casing on TSO, but New Relic is quoting through marketplace. So that's happening into lots of large customers. >> Stu: Yeah, uh, you know, what if you talk about the adoption of Cloud we need to make it simpler for customers to move those. And the financial piece has always been one of the promises of Cloud, but things like this Private Offer, it sounds like it helps accelerate, uh, that simplicity, and, and you know, reduces any, you know, perceived barriers there are between some of the software vendors and what you're offering. >> Dave: Well, it flows the New Relic software supply right through marketplace and more and more large companies are using marketplace for software supply. And, so, New Relic's in there. It means that our sales teams are working together So, we talked this morning at the conference with the VP of Cloud architecture who was in the conversation. And so, Chris has been working with the AWS team and with the New Relic team and we're joined at the hip as they expand their use of New Relic. And they announced this morning that they've now moved over thirty percent of all of the Cox application onto the AWS Cloud. And New Relic's been the center of that visibility. >> Stu: All right, so, Todd, a lot of announcements at the show, especially uh, you know, the capital p platform as Lou talked about in the keynote this morning. Well, you know, AWS is one of the largest platforms out there today. Help us understand how these fit together, both platforms as well as just, just the announcements in general as to how they work with AWS. >> Yeah, what every single thing we announced today had some sort of AWS tie to it. So, I mean first of all with New Relic, one, being a platform, it's open, connected, and, um, and, and programmable. And, so, the open part of that means that not only can we just inject data with New Relic agents, now we, we now are an observability platform that will take date from all kinds of sources, so think of what that opens up in working with AWS and AWS's other partners and getting data from a bunch of different sources, to then make the observability even better. We announce a log in solution. We're already connected with AWS, uh, cloud watch logs and, and, uh, working on some other new feature solutions in the log in space. And then from a programmability perspective, um, we can now take what we have, we can write all kinds of applications on top of the New Relic platform. And some of the initial couple of, of the dozen application that have already been opensource, one is a cost optimization play which looks at Amazon data, uh, both utilization performance data, some other sources of data that New Relic has, and then pulls in the Amazon cost data, can actually look at, in the New Relic platform, as a free opensource application, how do I optimize my cost in the AWS environment? And the second one, which we didn't talk about too much this morning but it's out there, but we can take some of VienMore data and some of the on PRIM data that we have visibility to today and help design that landing zone to help migrations do better, So, it's just two really quick examples of how we can take data from all these different sources and program it, write new applications on top of it, create an awesome customer use case and work with Amazon and, uh, help migrations and optimization along the way. >> Stu: All right, Dave, I'm wondering if you have any customer examples that might highlight some of the joint work that's being worked on between New Relic and AWS. >> Dave: Also, You Know, obviously I've just made some Cox We stood on stage this morning with the press where Cox has said that they've now got nine thousand work loads under New Relic visibility. And so that nine thousand work loads is across hundreds of development teams and, I think, Cox is just an illustration of many customers that we have in common. Um, you know, we're, AWS has got thousands of enterprises, so does New Relic. I think you've said you have over one hundred thousand five hundred enterprises using you. So, some large number. So there's a high overlap in many customers at this conference. And as we sat in the room this morning, um, I would say more than half the room held up their hands when I said, "Who in this room is using AWS?" Half of the audience here are AWS customers and New Relic customers. >> Todd: If I could maybe just add on the Cox story a little bit, because I've been very involved with that one. The beauty of the partnership we have there was multiple, on multiple phases. First, Cox has been a customer of ours for a number of years. Both on PRIM and in the cloud as they have accelerated their cloud, we've helped a lot with that. What was great about that partnership was that our field teams got together and, and actually really sat down and, and mapped out the migration, multiple migration scenarios. We had data on a bunch of on PRIM stuff that was valuable to AWS. AWS was the standard on a couple of divisions on cloud that we weren't monitoring all the applications there. So the teams really worked really well together and then at the end of the day, we came together and said, um, there's a bunch of benefits for the customer, for AWS and us, if the, if uh, if a transaction, the last transaction we did there, went though the marketplace, which was a significant transaction that we did with, ah, on the marketplace. So it was just such a win, win, win that tied together the, uh, all the aspects of the strategic nature-natureship, nature of our partnership. >> Stu: All right, so, you know, it's clear you're teams have been working close tother, iterating and adding a lot of the last kind of year, year or two or so. Give us a little bit look forward. What more should we expect of, a, from, from this partnership? >> Dave: So the area I think I would talk about next, that I think all customers are paying attention to, is spam management. So, you migrate your application to the cloud, you establish a could operating modem, um, we license out software through marketplace, you're now running it, at last week we have another product that I run called Service Catalog. And last week what we launched in Service Catalog was a new ability, and Service Catalog is a library of templates, so those templates are launched as Jason Templates using something called cloud formation and we've versioned the templates and what we launched last week was an integration between Service Catalog and another tool our customers have called AWS Budgets. So now what you actually want to do is you want to grant the team access to a resource and on the tag of the template, you actually want to give that resource template a budget. So that is actually under an API, so there's an AWS Budget API, there's a Service Catalog API, Lou's team today announced a whole raft of New Relic tools. But one of the things that they announced was the ability to essentially build these new widgets, using a React widget, and pull data from other sources. So that's the area some of the customers are looking at as far as taking your spam widget and connecting it into both AWS Budgets and Service Catalog. I don't know if you want to give us your thoughts on that. >> Todd: I, I already talked a little bit about it but it's, it's, it's where we can go. Like the future if almost, almost, uh, infinity right now. What we can go do together. We are trying to align to several of the programs Dave mentioned around Service Catalog, Migration Hub, focus on a couple different use cases of what, um, ever migration has a bunch of nuances and every optimization story has a bunch of nuances. But how can we create the right application, which are a starting point, opensource, put, put the repository up on get up and then allow customers and partners to go and fork that, do what they want to match, kind of of standard use case and maybe eighty percent of the way there. But then it needs a little but of tweak, a little bit of customization basesd on whatever that customer's situation is. We've enabled the entire, uh, community of millions apps that are going to migrate to the AWS cloud over the next couple of years. We've enabled that with what we've launched today. So, the, uh, the future is, is infinity and beyond. >> Stu: All right, well, Todd and Dave, thank you so much for the update. We look forward to seeing what gets announced at AWS Reinvent, which, of course, it'll be our seventh year of having theCube there. Big presence, uh, please reach out if you want to talk to us ahead of time. And check out theCube.net, of course, where you can see, uh, where we will be, including, of course, AWS Reinvent, uh, in December, uh, in Las Vegas. So, This is theCube at Future Stack 2019. I'm Stu Miniman. Thanks for watching theCube.

Published Date : Sep 19 2019

SUMMARY :

Brought to you by New Relic. and Dave McCann is the Vice President at the AWS shows a couple of times. and cost of how that migration, uh, the marketplace, uh, you know is, and New Relic feeds the data right into the TSO tool. And the question is, "At what speed?" And the financial piece has always been of all of the Cox application onto the AWS Cloud. of announcements at the show, especially and some of the on PRIM data that some of the joint work that's being of many customers that we have in common. The beauty of the partnership we have there iterating and adding a lot of the last and on the tag of the template, and maybe eighty percent of the way there. Big presence, uh, please reach out if you

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Guy Fighel, New Relic | New Relic FutureStack 2019


 

>> Reporter: From New York City, it's theCUBE, covering New Relic FutureStack 2019, brought to you by New Relic. >> I'm Stu Miniman, we're here in New York City right next door to Grand Central Station, at the Grand Hyatt. This first year of theCUBE, attending New Relic's Futurestack, the seventh year of the show, and happy to welcome to the program, Guy Fighel, who's the vice president and general manager of New Relic AI of course, CEO was up on stage this morning announcing New Relic AI, it's in beta, Lew said expect early 2020 for to come out, so thank you so much for joining us. >> Thank you for being here. >> All right, so Guy, you came to New Relic by way of the acquisition of signifAI. And that ends in AI of course, even though we pronounce it signify, so help us understand is this a repackaging, rebranding you know, New Relic-izing the product that was through the acquisition, tell us how we've gotten here. >> Yes, sure, so New Relic AI is a whole new set of capabilities, it's a suite of capabilities that we are launching today in beta that pretty much augments the site reliability engineers with AI and ML capabilities. It runs on top of the New Relic One platform, which is the first observability platform that is connected, open, and programmable so you have all of the existing information and data that you already have inside New Relic. And we've incorporated a lot of the technologies and the techniques that we have developed as part of signifAI with existing capabilities that New Relic already had, and pretty much integrated all of that into single user experience and single type of capabilities across the stack. >> All right so, Guy, AI is a really broad category you know, you got your AI and ML and cognitive and you know all these things, what was kind of the core IP of SignifAI when they came in. >> Sure, so we really focused on correlating and reducing the noise of all of your different alerts and incidents but not just that, we've actually built a recommendation engine on top of that, to provide you much faster context to get into potential root cause of all of your different information focused on events. And now we're combining that with all the time series data that New Relic as a platform has to offer, so you're getting a much broader capabilities for understanding. >> Yeah, you know, definitely there's that promise of AI as we know that humans alone or my traditional tooling just can't keep up, you know, talk about all the different sources of data, the volume of data. I just saw Lew talking about the amount of the millions of items being ingested into the New Relic database, and the billions of items that are being read basically per second. So, help us understand. You say we love, we talk about our videos or extracting the signal from the noise, so, did I hear it was like 80, 85% your early customers are helping to reduce that noise Bring us in a little bit more. >> True, yes, so definitely early results shows us over 80% noise reduction for some of the customers and it is important to understand this is automatic relations, so this is truly based on the engines with no human interaction. Now, we actually have even greater results when some user input is driven into the system and that raises the capabilities as well. In terms of the number of events, yes, we are dealing with huge amount of events and information in the platform and I think it's, all around, not replacing the humans, but actually augmenting the site reliability engineers, so you talked about how systems, you know, there is a great promise for those capabilities. We believe that applied intelligence is a much better term, because it gives really enabling the augmentation for the site reliability engineers. We don't believe that site reliability engineers needs to go away or can even be replaced anytime soon. We definitely think that we can help them understand better and faster, what is the type of problems that they see in their production environments, and then help them resolve that much faster and better. >> Yeah, absolutely, we're huge supporters of really, the best solutions are when you have the people plus machines, there are certain things the machines are going to do on their own, but it's the marrying, so help us understand who's going to be using New Relic AI how is it going to change their day-to-day life and maybe even kind of organizationally, what the impact will be. >> Sure, so if you're a site reliability engineer, or a DevOps themed depending on, how you want to call yourself and, you know, there's a big debate in the industry, whether it's DevOps or site reliability engineers. Pretty much anyone who is responsible for Op time in the digital production environments you're a relevant user, If you carry the pager, if you're on call, you're a relevant user, so you're going to be interacting with the system to be able to actually see what are the problems with potential recommendations and then, you can infuse the system with your own logic. Whether it's based on the logic, we also provide very easy user experience we'd like thumbs up, thumbs down, different types of feedbacks as part of the workflow and I think the most important piece is that we're connecting to users where they are. Meaning, we don't believe we need to change the workflows so, if you're a user and you're already using with a specific internet management providers and you've already connected some of the additional monitoring tools to those providers, we now offer you a streamline of syncing to those instant management platforms and then, in reaching them with all of the information that we already have on the platform. >> So Guy, we've talked about AI but, let's talk a little bit about AI Ops. So, you know I've talked to the number of the vendors I actually went to an AI ops conference earlier this year and some of the talk track was, APM is the old way, AI ops is going to replace what you were doing before Let's take all your scattered tools and consolidate them down. some of the messaging reminds me of what I heard this morning, the New Relic One platform is going to replace a number of tools, pull everything together. Help us kind of, you know, square that circle of APM and AI ops and where you see New Relic compared to some of those competitors out there today. >> Sure, so APM is application performance monitoring. it's all about monitor and have that visibility to your application layer, it has nothing to do with AI ops it has nothing to do with replacing the tools. We believe that everyone should have visibility into their application, and that's, a lot of that messaging came through Lew's key note this morning, and opening it up to any type of open source instrumentation so we can bring it to the platform whether you want to drop an agent, whether you want to use any other open source SDK, we allow you to do that. Pretty much opening up the platform and giving you the option. AI ops is a term coined by Gardner actually, and it is pretty much applying some automation, AI capabilities, ML capabilities, statistical analysis capabilities on huge amount of data that you have in a centralized place. It has nothing to do with the monitoring, per se, so, I definitely think that the industry's going into a new space, where there is a consolidation obviously with different vendors. I believe that New Relic is giving customers the choice to make, whether they want to go and continue using their old tools, and that's okay, and we are an open platform so we will sync up with their data as part of New Relic AI we'll be able to bring in the new data whether by, again inter-connecting with their incident management platform or through a rest API or native integrations or if customer choose to do that, they can just send us all of the data directly and then, we apply the AI ops capabilities on top of the existing platforms. So, it's really opening up for the choice of the customer. >> All right it's been less than a year since the acquisition of SignifAI we know that some of the things when you do an acquisition it's an area of investment, you're going to get more resources, more people but, you've mentioned customers a couple of times, maybe give us a little bit of insight as to how the customer conversations have changed now working for New Relic, as opposed to being a customer understanding that piece of the New Relic ecosystem. >> Oh absolutely, I think, you know, as you transition from a small start up into a company like New Relic you get much more exposure to enterprise customer, your scaling capabilities are much better so we're in serious conversations with a lot of the enterprises customers that have a lot of interest in what we do. A lot of it is part of the branding recognition and all of the great capabilities that New Relic has already, and then marinade that with all of the capabilities that we're bringing or that we brought into New Relic as a young start-up with all of the latest technologies and a lot of the AI capabilities which are truly innovative ones, so definitely see a lot of traction from the enterprise customers, the more sophisticated ones as well. >> All right, so the solution announced today is in beta give us a little bit of a look forward as to what we should expect to see and what feedback you're hoping to get from customers along the way and how they might get engaged if they want to. >> Yeah so definitely we are in beta today. We've engaged with customers prior to the beta, so, we already got a lot of feedback and great feedback and we make some tweaks to the product based on that. We're actually announcing AGI of a small feature today which is enhanced incident context, which provides you active detection for time series data all the way to your slack channels but the overall solution is currently in beta and as we are progressing, within every month we're going to get more and more customers engaging with the platform, and then we're going to release a much more advanced capabilities even than what we have today in GA coming early next year. >> All right great, last thing, big mention and push about observability this morning, help us understand where AI fits into the broader discussion of observability. >> So again, as I mentioned before the observability will allow you to see all of your data in a centralized place. So, it's combining matrix, events, logs and traces in a specific place that now algorithms and different techniques such as AI and ML based algorithms really, really be successful in gathering, understanding, because you have all of that different information for the human brain, it's very hard to actually go and crawl and kind of ingest all of that vast amount of different data points for machines, they're very good at that. They're starving for broad amount of data and so having that capability, building on top of a true observability platform is what makes the AI and ML so successful and drive value to customers in really understanding what the data means. >> All right well, Guy thank you so much for sharing best of luck on the journey towards GA for the the full New Relic AI in the future. We look forward to, launching it. >> Thank you so much. >> All right and once more here, walking through at the New Relic Futurestack 2019, here in New York City. I'm Stu Miniman and thanks for watching theCUBE. (upbeat music)

Published Date : Sep 19 2019

SUMMARY :

brought to you by New Relic. of the show, and happy to welcome to the program, of the acquisition of signifAI. a lot of the technologies and the techniques and you know all these things, the noise of all of your different alerts and incidents of the millions of items being ingested and that raises the capabilities as well. the best solutions are when you have and then, you can infuse the system with your own logic. is going to replace what you were doing before the choice to make, whether we know that some of the things when you do an acquisition and a lot of the AI capabilities which are truly All right, so the solution announced today is in beta and as we are progressing, within every month into the broader discussion of observability. the observability will allow you best of luck on the journey towards GA at the New Relic Futurestack 2019, here in New York City.

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Glenn Nethercutt, Genesys | New Relic FutureStack 2019


 

>> from New York City. It's Theo Cube covering new relic Future Stack 2019. Brought to you by new relic. >> Welcome back on stupid a minute. This is the cubes coverage here of future stack 2019 new relics. 70 year they're doing the show is the U. S. Show. They actually bring these few locations around the globe, right next door to Grand Central Station and about 600 in attendance. And been really excited to kick off with the number of the users here at the show and happened. Welcome program. First time guests. Another cut. Who is the technical fellow in chief? Architect with Genesis. You been at the event a number of times. You're speaking at the event today, but let's start with Genesis. Customer experience is something that I think a lot of people been hearing about on. That is the product. The Genesis has tell us a little bit about the company itself. Sure. >> Yeah. So, Genesis, uh, brain that Maybe not. Everybody knows, but they certainly transitive Lee know us. We're a customer experience platform. We like to say that we're a technology company, but we power. The experience is about 25 billion customer experiences every year for 11,000 plus customers. About 1000 different countries around the world s So we are all about having a connection between brands and their customers, and we enable that >> s o not only some of the cloud shows. I was an enterprise connect earlier this year and definitely was, you know, something I heard a lot about see Exit really important Not only how customers interact with the brand, but internally how you know we treat the employees and that interaction is something that that is raised up. People are kind of important inside, but we're going to talk too much about the people here. We're gonna talk about the technology as the chief architect of this gives a little bit about what you have your arms around in a responsible for >> sure s o for for me, of the project. Your cloud was the name for for a long time, Genesis Cloud as of yesterday. So we are a public cloud offering as a CX platform and I say platform because we made the transition from just being a product to a platform. In my opinion last year, more than half of our FBI work is actually code we didn't right? So I think people using you as a programmable thing is when you become a platform. So I'm responsible for things like cloud architecture for understanding. Let's say industry trends. What technologies? We're gonna use a lot of eight of us service designed technical vetting, general cat hurting that sort of thing, >> Right? So you said your public cloud, but you said it sits on top of AWS. But it's a platform that your customers can then build on top. >> That's right. That's right. So we like to think of ourselves as C X. As a service. We've had some that use us still like a product all shrink wrapped, ready to go, others that want to extend us either writing their own. You guys writing their own back ends their own integration points. We make all of that possible. >> All right, so I'm expecting you have a bit of an opinion when it comes to that platform, As Lou said with a capital P A, and it's gotta be programmable, it's gonna be open. Tell us what your thoughts about new relic kind of entering, you know, new relic one being they said today the first, and only if their claim of observe ability platform s o give us your thoughts around. >> Absolutely. Yeah. S O. I like to think that we have been using the relic as a platform for awhile, whether they knew it or wanted it or not way have a fairly rigorous continuous delivery pipeline. And we are very big believers in infrastructure is code and develops principles. So for us, the engineering teams don't just own the code that they write, but they own the infrastructure definitions. They even own alert definitions, dashboard configurations. And we push that information directly into the relic as our deployments happen. Live hundreds of times a week around the globe. >> All right, so how do these modern architecture's enable you to run a team? >> I can't imagine trying to manage 350 plus Micro service is in production, which is roughly what we have today over 1000 Lambda Functions way can't improve what we don't measure. Everyone likes to say that, but it's true. I have a little bit of an a p m background from from places past. So I was a firm believer that you need to invest early and observe ability and metrics. So we've been a day one kind of new relic subscriber in the cloud space. Everything from understanding how the infrastructure parts work now to serve earless. It's all been about moving up the value stack like commodity metrics of servers is great and still needed. But transactional information and now trace information is absolutely essential. >> Okay, in the Kino this morning, they walk through their metrics events, logs and traces. Where are you with, you know, these various sources of data and harnessing the value of that. >> So I would say, with fairly early towards the tracing part before new relic headed as a managed thing they had cross at tracing. I'm sure you're familiar with that sort of the prior incarnation of distributed tracing on. We leverage that pretty pretty heavily, but it obviously doesn't have quite the same utility a cz what the new open tracing standards provide s so we do things like having correlation i d. S. That let us tag and follow things around. Now we just get to off load that from our team's being as responsible for it. And now the platform gives it to us. >> Yeah. Glen is open source important to your organization? >> Absolutely. We try Thio, give back some ourselves. In fact, one of the one of the nerd lets the nerd packs that Lou mentioned on stage was one that our team wrote s Oh, yeah, way believe not only that, we need a p i's and programmatic access to do our jobs, but we like toe enable and help other people with the same >> Eric Spence got a shout out on the Maquis note was that the thing that you were talking about it is >> I expect to see us probably released two or three more nerd packs before the end of the year Way, way are eager to do that rather than just investing in all of our own. You I that we had glass over the top of the relic. Now we actually just get to put those components deeper inside of new relic proper. >> Okay, eyes there. Anything else from the announcements this morning that you're looking forward to leveraging? >> So I think there's there's definite changes in the A p M space. You'll hear a little bit more, probably in the deep dives one of the talks I'm having later with not even she will be talking about. Some of those things were definitely interested in that. Open telemetry has some value. Greater Genesis definitely has investments around things like Prometheus and other sorts of monitoring. So if I'm not talking about just the public cloud side of it and other aspects there definitely things we can leverage. >> All right, Glenn gives us share a little bit, if you can. About what? What you're talking about here at the show. So one of >> the big mitts is entity centric. Observe, ability. The idea again that we're not just looking at servers and static infrastructure. We're looking at things that are very ephemeral. We have a lot of dynamics scale on our platform on. We need ways to actually frame what we're looking at at the level of Micro Service's but often level like business applications. So even when we're creating some of these extension points like the one you just mentioned way framed that within the context of a service that does a particular vertical slice on dhe, that's that's kind of where we like to invest. So we like to live. >> Okay, um, you know what's what's on your road map of? You know where you're going with your journey and is there anything that you're looking for? Beyond what was announced today from new relic ER from the ecosystem at large, >> I think there's lots of refinements of what was announced today that will help us theeighty I ops side, I think not just for noise reduction, but also for like, early early signal detection. It's a pretty fascinating space. Will likely invest some of our own dollars in times trying to help that along. Definitely Ah, lot of distributed tracing and Maur investment. There is a big piece for us. I think the A PM space. There are areas that I'd like to see a peon vendors invest in that goes beyond what now, I guess, is becoming more, more traditional, like transaction information. We have a lot of a i machine learning ourselves, and I think monitoring those types of workloads is going to be very different. As big of a paradigm shift as it was to go from classic monitoring Transactional. I think we're about to see that happen again in the >> industry. Yeah. What can you share some of the kind of the A I journey that you're going through a genesis where you are, You know what the maturity level is of solutions that you're using and >> sure way have a fairly robust aye aye team on products range from in the W m space back to the people that you mentioned at the first part of the talk way have workforce optimization, workforce management, and we brought a I algorithms to that a lot of time. Siri's forecasting that used certain machine learning techniques. We've invested a fair amount in until you and Opie any are so everything from sentiment detection to live transcription that we built in house to our own body engines that d'oh the new dialogue management. So we have a fairly robust bit there and some on the management side on the operational back in that we used to try to improve our quality of service on reduced any sort of incidents on the platform. >> All right, it's your third year. Third time coming to this show was what brings you back? What you excited about? I kind of dig in and take away from the event this year. >> I think the relics always been a partner in my stance, not just a vendor we believe so deeply in the observe ability message that one I want to be part of shaping that narrative. Eso coming to future sack actually talking to a lot of other executives, seeing where they're going and kind of sharing that use case, but also trying to be a little bit of a lighthouse. Thio, the new relic team as well, is what brings me back every year. >> Observe ability is something that it hurt. A number of startups talking about in the last couple of years were, in your opinion, does new Rolex it compared to the marketplace overall, obviously, they just kind of announced the observe ability, you know, full suite with new relic one. But you know what your viewpoint is? Toe have their wealth, their position? >> Where did I think their position? I think they are best of breed for what we're currently seeing. Owners of ability. There are other things, I think, where we could cobble together bits from multiple vendors but frankly, having application performance monitoring along with infrastructure, along with data being cold from the cloud platforms that we're all in, like, eight of us. They've got a unique place. I think the power of their agent technology has proven itself over time as well. My guidance to most other other companies that I speak with about this subject is don't just trust that it's all magic invest on. And I think they make themselves easy to invest in on. I think this platform play is a good one for them. >> All right. Well, another cut. Thank you so much for joining us. Sharing your journey, What we're doing in the best of luck on your presentation today. Thank you, sir. All right. Be back with lots more coverage here from a new relic. Future stack 2019. I'm still Minutemen. And thank you for watching the Cube.

Published Date : Sep 19 2019

SUMMARY :

Brought to you by new relic. the globe, right next door to Grand Central Station and about 600 in attendance. About 1000 different countries around the world s So we are all about having of this gives a little bit about what you have your arms around in a responsible for So I think people using you as a programmable thing is when you become a platform. So you said your public cloud, but you said it sits on top of AWS. So we like to think of ourselves as C X. As a service. of observe ability platform s o give us your thoughts around. And we push that information directly into the relic as our deployments happen. So I was a firm believer that you need to invest early and observe Okay, in the Kino this morning, they walk through their metrics events, logs and traces. of the prior incarnation of distributed tracing on. and programmatic access to do our jobs, but we like toe enable and help other people with the same You I that we had glass over Anything else from the announcements this morning that you're looking forward to leveraging? So if I'm not talking about just the public cloud side of it and other aspects there definitely things we can leverage. All right, Glenn gives us share a little bit, if you can. So even when we're creating some of these extension points like the one you just mentioned way I think there's lots of refinements of what was announced today that will help us theeighty I ops side, through a genesis where you are, You know what the maturity level is of in the W m space back to the people that you mentioned at the first part of the talk way I kind of dig in and take away from the event this year. Thio, the new relic team as well, A number of startups talking about in the last couple of years I think they are best of breed for what we're currently seeing. And thank you for watching the Cube.

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Josh Biggley, Cardinal Health | New Relic FutureStack 2019


 

(upbeat techno music) >> Announcer: From New York City, it's theCUBE, covering New Relic FutureStack 2019, brought to you by the New Relic. >> Hi, I'm Stu Miniman and this is theCUBE's exclusive coverage of New Relic's Futurestack 2019 here in New York City, seventh year of the show. Our first year here, about 600 or so in attendance, and real excited, because we've had some of the users here to help kick off our coverage. And joining us, first time guest on the program, Josh Biggely is a senior engineer of Enterprise Monitoring, with Cardinal Health coming to us from a little bit further north and east than I do, Prince Edward Island, thank you so much for coming here to New York City and joining me on the program. >> Yeah, thanks for having me Stu, I'm excited to be here. I haven't been in New York, it's probably been more two decades. So it's nice to be back in a big city, I live in a very small place. >> Yeah, so if you go to Times Square, it's now Disneyland, is what we call it. It's not the 42nd street that it might've been a couple of decades ago. I grew up about 45 minutes from here, so it's gone through a lot, love the city, especially gorgeous weather we're having here in the fall. >> I'm excited for it. >> All right, so Josh, Cardinal Health, health is in the name so we think we understand a little bit about it, but tell us a little bit about the organization itself and how it's going through changes these days. >> Sure, so Cardinal Health is a global healthcare solutions provider. We are essential to care, which means we deliver the products and solutions that your healthcare providers need to literally cure disease, keep people healthy. So we're in 85% of the hospitals in the United States, 26,000 pharmacies, about 3,000,000 different home healthcare users receive products from us. Again we're global, so we're based in Dublin, Ohio, just outside of Columbus. But obviously, I live in Canada so I work for the Cardinal Health Canada Division. We've got acquisitions around the world. So yeah, it's an exciting company. We've recently gone through a transformation not only as a company, but from a technology side where we've shifted one of our data centers entirely into the cloud. >> All right, and Josh, your role inside the company, tell us a little bit about, you said it's global, what's under your purview? >> So my team is responsible for Enterprise Monitoring, and that means that we develop, deploy, support and integrate solutions for monitoring both infrastructure applications and digital experience for our customers. We have a number of tools, including New Relic, that we use. But it's a broad scope for a small team. >> Stu: Okay, and you've talked about that transformation. Walk us through a little bit about that, what led to, as you said, some big moves into public cloud? >> Yeah, our team is part of an overall effort to allow Cardinal Health to be more adaptive, to be more agile. The move to cloud allows teams that are developing applications and platforms to make a decision how to respond to the needs of their customers more rapidly. Gone are the days of, "I need a new server, "I need to predict six months from now "that I'm going to need a new server, "put the order in, get it delivered, "get it racked, get it wired." We watch a lot of people, the provision on demand. I mean, our senior vice president, or my senior vice president, likes to say, "I want you to fail fast, fail cheap." He does not say fail often. Although sometimes I do that, but that's okay. As long as you recognize that you're failing and can roll that back, redeploy, It's been really transformative for my team in particular, who was very infrastructure focused when I started with the company five years ago. >> Stu: All right, and can you bring us inside from your application portfolio, was it a set of applications, was it an entire data center? What moved over, how long did it take, and can you share what cloud you're using? >> Sure, so it's been about a two year journey. We're actually a multicloud company. We've got a small footprint in Azure, small footprint in AWS, but we're primarily in Google Cloud. We are shutting down one data center, we are minimizing another data center, and we've moved everything. We've moved everything from small bespoke applications that are targeted on team to entire ecommerce platforms and we've done everything from lift and shift, which I know you don't like to hear. But we've done lift and shift, we've done rehosting, we've done refactoring and we have re-architected entire platforms. >> Yeah, so if you could expand a little bit when we say lift and shift, I'm fine with lift and shift as long as there's another word or plan after that which I'm expecting you do have. >> Josh: Yeah, absolutely. So the lift and shift was, "Hey, let's move from our data centers into GCP. "Let's give teams the visibility, the observability "that they need so that they can make the decisions on "what they need to do best." In a lot of cases, or in fact, in 15% of the 6,500 severs that we touch, we actually full out decommed the instance. Teams had them, they were running at our data centers but they weren't actually providing any value to the company. >> So you said your team before was mostly concerned about infrastructure and a lot of what you did is now on GCP so you fired the entire team and you hired a bunch of PhDs to be able to manage Google environments? >> Absolutely not. (laughter) The principals of enterprise monitoring as a practice still apply in a cloud. We are, at heart, data geeks. And I would fair say that we're actually data story tellers. Our job is to give tools and methodologies to application teams who know what the data means in context, but we give the tools to provide that data to them. >> Stu: All right, love that. I believe I've actually seen data geek shirts at the the New Relic shows itself. But data story tellers, that was kind of thing that you heard, "I have a data scientist "that's going to help us to do this." Is that data scientist in New York or are you actually enabling who is able to tell those data stories today? >> So that is the unique part. Data story telling is not a data science. I wish that I could be a data scientist, I like math, but I'm not nearly that good at it. A data story teller takes the data and the narrative of the business, and weaves them together. When you tell someone, "Here's some data." They will look at it and they will develop their own narrative around it. But as a story teller you help craft that narrative for them. They're going to look at that data and they're going to feel it, They're going to understand it and it's going to motivate them to act in a way that is aligned with what the business objectives are. So data story tellers come in all forms. They come as monitoring engineers, they're app engineers, but they're also people who are facing the customer, they're business leaders, they're people in our distribution centers who are trying to understand the impacts of orders in their order flow, in their personnel that they have. It is a discipline that anyone can engage in if we're willing to give them the right tools. >> All right, so Josh, you got rid of a data center, you're minimizing a data center, you're shifting to cloud, you're making a lot of changes and now being able to tell data stories. Can you tell us organizationally everything goes smoothly or are their anythings that you learned along the way that maybe you could share with your peers to help them along that journey? And any rough spots, with hindsight being what it is, that you might be able to learn from? >> Yeah, so hindsight definitely 20/20. The one thing that I would say to folks is get your data right. Metadata, trusting your data is key, it's absolutely vital. We talk a lot about automation and automation is one of those things that the cloud enables very nicely. If you automate on garbage data, you are going to automate garbage generation. That was one of our struggles but I think that every organization struggles with data fidelity. But teams need to spend more time in making sure that their data, specifically their metadata, around, "Hey is this prod, is it non-prod, "what stack is this running, who built it?" Those things definitely need to be sorted out. >> Okay, talk about the observability and the monitoring that you do, how long have you been using New Relic and what products? And tell us a little about that journey. >> Sure, so we've been using New Relic for about two years. It was a bit of a slow run up to its adoption. We are a multi-tool company so we have a number of tools. Some of them are focused primarily on our network infrastructure, our on-prem storage. Although Cardinal had moved predominantly to the cloud, we have distribution centers, nuclear pharmacies all around the world. And those facilities have not gone into the cloud. So you've got network connectivity. New Relic for us has filled our cloud niche and observability, as Lou announced, is going to give us context to things that we're after. You hear the term dark data, we call them obs logs. It's data that we want to have, we only need it for a very short period of time to help us do post-op or RCAs as well as to look at, overall in our organization, the performance of the applications. For us, New Relic is going to give us an option to put data for observability. Observability is really about high fidelity data. In its world of cloud, everyone wants everything right now. And they also want it down to the millisecond. A platform that can pull that off, that's a remarkable thing. >> Yeah, Veruca Salt had it right, "I want it now." So are you using New Relic One yet? >> We have been using New Relic One for at least a couple of months going back into March this year. It's exciting, we're one of those companies that Lou talked about in his key note, we have hundreds of sub accounts. And we did so very intentfully, but it was a bit of a nightmare before we got to New Relic One. That ability for a platform team to see across multiple sub accounts, really powerful. >> Okay, so you saw a lot of announcements this morning. Anything particular that jumped out, you were excited? Because Lou kept saying over and over, and if you're using New Relic One, "This is free, this is free, this is free." That platform where it's all available for you now. >> I think the programmability is one of the things that really got me excited. One of the engineers on my team had a chance to go and sit with Lou and team, two weeks ago, and was part of that initial Hackathon. Made some really interesting things. That's exciting so shout out to Zack and the work he did. Logging, for me, is something that is huge. I know we've got data that we should have in context. So that Lou announced five terabytes of ingestion for free, all I could do was tap my fingers together and think, "Oh, okay. You're asking for it, Lou. Challenge accepted." (laughter) >> Stu: That's exciting, right. So you feel that you're going to be building apps, it sounds like already, at the FutureHack. That you're starting to move down that path. >> Definitely, and I'm really excited. Not to necessarily give it to my team. We build the patterns for teams that needs patterns, but there are so many talented individuals at Cardinal Health who, if we give them the patterns to follow, they're just going to go execute. Open sourcing that is a brilliant idea and really crowd sourcing development is the way to go. >> Yeah, I think you bring up a really interesting point. So even though your team might be the one that provides the platform, you're giving that programmability, sensibility to a broader audience inside the team and democratizing the data that you have in there. >> Yes, you keyed in on one of the things I love to talk about which is democratized access to data. Over and over again you'll hear me preach that, "I know what I know but I also know what I don't know "and more particular I don't know what I don't know. "I need other people to help me recognize that." >> We've really talked about that buzzword out there about digital transformation. When it is actually being happened, it goes from, "Oh, somebody had an opinion," to, "Wait, I actually now can actually get to the data, "and show you the data and leverage the data "to be able to take good actions on that." >> That's right, data driven decision making is not just just an idiom. It's not something that is a buzzword, it is a practice that we all need to follow. >> Stu: All right, so Josh, you're speaking here at the show. Give our audience just a quick taste, if you will, about what you're going to be sharing with your peers here at the show. >> We've actually talked about a lot of it already so I hope that people are not going to watch this session before my session later. But it really is around the power of additional transformation, the power of observability, what happens when you do things right, and the way the cloud makes teams more nimble. I won't give you it all because then people won't watch my session on Replay but, yeah, it'll be good. >> Well, definitely they should check that out. I'm hoping New Relic has that available on Replay. Give the final word here, what you're really hoping to come out of this week. Sounds like your team's deeply engaged, you've done the Hackathon, you're working with the executive teams. So FutureStack 2019, what are you hoping to walk away with? >> For me, it's about developing patterns. My team, in addition to our enterprise architecture team, is responsible for mapping out what we're going to do and how we're going to do it. Teams want to go fast and if we're not going to lay down the foundation for them to move quickly, especially in the realm of enterprise monitoring, they're going to try do it themselves. Which may or may not work. We don't want to turn teams away from using specific tools if it fits, but if there's a platform that will allow them to execute and to keep all that data centralized, that is really the key to observability. Having that high fidelity data, but then being able to ask questions, not just of the data you put in, but the data that put in maybe by a platform team or by a team that supported Kubernetes or PCF. >> All right, well, Josh Biggely, thank you so much for sharing all that you've been going through in Cardinal Health's transformation. Great to talk to you. >> Thanks so much, Stu. >> All right, lots more here at New Relic's FutureStack 2019. I'm Stu Miniman and as always, thank you for watching theCUBE. (light techno music)

Published Date : Sep 19 2019

SUMMARY :

brought to you by the New Relic. and joining me on the program. So it's nice to be back in a big city, Yeah, so if you go to Times Square, health is in the name so we think We are essential to care, and that means that we develop, deploy, support what led to, as you said, some big moves into public cloud? and platforms to make a decision to entire ecommerce platforms Yeah, so if you could expand a little bit in 15% of the 6,500 severs that we touch, to application teams who that was kind of thing that you heard, and it's going to motivate them that maybe you could share with your peers that the cloud enables very nicely. that you do, how long have you been is going to give us context to things that we're after. So are you using New Relic One yet? to see across multiple sub accounts, really powerful. Anything particular that jumped out, you were excited? That's exciting so shout out to Zack and the work he did. So you feel that you're going to be building apps, and really crowd sourcing development is the way to go. and democratizing the data that you have in there. "I need other people to help me recognize that." "Wait, I actually now can actually get to the data, it is a practice that we all need to follow. Give our audience just a quick taste, if you will, so I hope that people are not going to watch this session So FutureStack 2019, what are you hoping to walk away with? that is really the key to observability. Great to talk to you. thank you for watching theCUBE.

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Dirkie Gertenbach, AB InBev | New Relic FutureStack 2019


 

(upbeat music) [Narrator] - From New York City, it's theCUBE. Covering New Relic Futurestack 2019. Brought to you by New Relic. >> Hi, I'm Stu Miniman and the theCUBE's exclusive coverage of New Relic Futurestack 2019. We're here at the Grand Hyatt which is right next to Grand Central Station in beautiful Manhattan, New York City. We're going to be speaking to a number of customers as well as the executives. It's the seventh year of the show, our first year here and helping me kick off the event, always happy to have a customer on. Dirkie Gertenbach, who's the global B2B engineering lead at AB InBev, a local customer here. Dirkie, thank you so much for joining us. >> Thanks, nice to be here. >> Alright, so, nothing better than getting together with a bunch of your peers you know, downtown New York City, talk about, you know, some cool technology. Before we get into the tech though, I think most people understand AB InBev you know, global beverage brand, really well-known, I know I saw beer trucks when I was making my way through New York City. But tell us a little bit about, kind of, the company and your role inside it. >> Yeah, sure. So, yeah, we're a global beer company, we sell beer. My main focus is the engineering lead at InBev and we look specifically at the e-commerce side of it. So, the digital sales. We've been going through a large transformation these last couple of years, where we flew from more traditional sales to like, digital sales, and we've been implementing our e-commerce platform in a couple of countries the last couple of years. >> So, transformation, it's not just that AB InBev goes from a couple of the largest known brands, you know, in the beverage to "oh boy, now there's so many different micro beers and and different things, I know I can't keep up with all the locals", but even a large brewery like your company - has all little brands, a similar thing I guess is happening on the technology side. >> Yeah. >> Yeah, maybe, tell us a little bit about you know, what that transformation, you know, what's causing that transformation and what is happening inside your or, to support this transformation? >> Yeah sure. So when we started off the digital transformation obviously, it was much simpler. We had a couple of applications in only one or two countries. And in these last two years we've been expanding and we've been implementing it in other countries and we've started moving from a monolithic to a more micro service central so obviously it's like not only one application now, it's like, it's hundreds of applications. In the beginning, it was quite tough because we were moving, we were developing stuff much more quicker than what we could support and that's when we started talking to New Relic. And we looked at their product and looking at a couple of ways of streamlining this operational and having more of a a stability on our products overall. Like, there's still have a lot, we are still immature in a lot of spaces. >> Yeah, so bring us in. You talked about you applications. You know, so many customers are going from their monolist to their micro services but they usually have, you know, that transition is not something that's done overnight, and they need to be able to manage all of that environment. Give us a little bit of view into, you know, what you can about your application portfolio, where you are on that journey and then, you know, what tool sets are you using to be able to manage, monitor and you know, the word of the day of course is observability, so you know, what that means to you and your-- >> Yeah sure, so like I said we've (mumbles) into micro services which is (mumbles) There's a lot of different applications that's running and the main thing that it showed is just having visibility on infrastructure as well as application performance. And application where it's optimal or not. So those are the most basic. We got New Relic involved and that's one of the main tools that we use for observability today. We were using a couple more but we are, like, putting everything into one bucket now. So, it's interesting, the new stuff. What they announced today, that's one of the stuff that we've been missing that's really going to help us. Especially the data base monitoring and the network monitoring. That's something to all our stuff is on Azure so we rely a lot on Azure monitoring. But it doesn't always give you that granularity of like, observability. One of the other things that we are excited about is the, what's the other thing? Sorry, I forgot, I'll come back to you. >> That's all right. So first of all, you know, are you using New Relic One from New Relic? >> We're starting to use it now, so we still use-- >> So walk us through a little bit the journey with New Relic. What products were you using? And tell us where you are with the platform and what you think of the vision of, as Lou said, it's a capital P platform in certain characteristics, that New Relic built when they had in mind? >> Okay, yeah, sure. So in the beginning we were using the browser and Sonetics just like a normal looking whether that website is up or down, and then we started looking so we've got ABM running on every single server we've got now, that gives us like a lot of visibility and we use the insights a lot, so just dashboards. What we found in the new One platform is the dashboard so we can create the linear of data and the visibility that we can give to our stakeholders. It's much better. Just the visibility on the different. I can give you a couple of used cases that we've gone through in these last couple of weeks. So for example, on one of our applications we're having like, login failure, a lot of login failures. And we are really struggling to look at locks and stuff and just pinpointing with that. So on all the data that's coming into New Relic, we started creating dashboards where we can actually see what's the different causes of these login failures and we can actually pinpoint where do we need to put our focus? So it was a good example. And then the other nice thing that I like about the one that we are using actively is the Kubernetes monitoring. It gives you visibility of your entire cluster every single product that's on there and you can just quickly see if there's a part that's struggling or not. >> All right. If you can, I was wondering if you could bring us inside your Kubernetes? How long have you been using it? Do you build your own or using one of the cloud or some other solutions? Tell us a little bit about your stack. What that solution, and where New Relic fits into it? >> Yeah, we started off the Kubernetes just over a year ago. We're using Azure AKAs. So all our stuff is in Azure. And so yeah, in the beginning, we built all of the applications and everything ourselves, so it's all out set. And again, just coming back to monitoring within Kubernetes, it's all controlled. Like (murmurs) It's difficult to have clear visibility so yeah, when they brought out the Kubernetes like monitoring that was like a life changer for us. It's just operations, we're being much more productive now in terms of if we need to scale up and whether our reports are healthy or not that definitely helps a lot. And I think that we've been working (mumbles) It's just the DevOps, we're very new in DevOps, and just the visibility that New Relic gives us helps us a lot in like, pinpointing where we need to focus our DevOps effort. So that's also a good help. >> Stu: Okay. You'd mentioned that there was some things announced that had you excited, things that you'd been looking for. Maybe you can explain, you know, which items jumped off the board at you this morning. >> Yeah, so again, just the database monitoring and the network traffic. That's very important. And then the one thing that's, we were just busy investigating a lock analyser. And the lock ingestion that they announced today that's very exciting. So I mean, we're already in New Relic so I think we're definitely going to look at that. That's going to be a big help. And then it just brings all our data together. And after you've used different tools for locks and monitoring, that's something that makes me very excited. And the other thing is, we're also use SAP in (murmers) and the partnership that New Relic is staring with SAP now, that's also very exciting. Something I'm seeing forward to. >> Stu: Okay. Was there anything you were hoping for that you haven't seen yet? Or anything on your wishlist that you want from either New Relic or from Azure, or from the industry as a whole? >> Nothing yet. I mean, like I said, we're still at early stages. I think maybe in the next year or so we're probably going to start saying, "Hey guys, maybe you need to build this as well" but for now it's just like they keep delivering stuff that before we can even think about it. So that's great. >> Uh, Dirkie, it's your first year coming to Futurestack. What specifically bought you hear? What are you hoping to get our of the day? >> Yeah, it's my first time here. Hopefully I'll come, like I said, I've only got a couple of hours today but I think just in terms of seeing the new stuff that can help us in our operations, our business operations and as well as Stave Apps, it's exciting to see how this can transform our business going forward. In terms of what else I want to see, I don't have high expectations at this stage. Like I said again, they keep delivering before we can actually say what we want so that's just great. >> You mentioned that you're early in your DevOps journey inside the company. Any other color you want to share about, just kind of organizationally what's changing in your business? You know, there's so many new things coming on. You know, you've watched Kubernete's a year ago, you're getting into logging, so the roles and responsibilities that your team members have, and keeping up with all of these various technologies, how's that impacting the work force and the jobs that they do? >> Yeah that's great. So again on our services that we've got we've got a lot of new teams as well, and we've been in a kind of a hyper growth stage, and we're building a lot of micro servers and stuff. We struggle to know whether the performance of that micro service is good enough or not. So that's one thing that our developers struggle with and that's something that New Relics has helped us with. Every single service that we've built, we put it on New Relic, and we've got a, like, you can see three days ago what has been average performance of this API. And that helps us also to type back to (murmurs). So we've got this arranged with each of our services, for our API inpoints , and this gives us a easy way to see whether we're on track or not, and it then translates back to the developer on whether they need to do something to increase that. Another great thing that we've been doing with New Relic with the VP of engineering is they've been helping us a lot in setting up our sites reliability teams. So we've had a couple of discussions with them these last couple of weeks and they've helped us a lot in just identifying what's the different teams that we need to bring to our organization to keep operating in this way and the growth that we are. Also something that's great that we've been looking at, and New Relic has also helped us a lot there, we had a lot of monitoring, we're monitoring everything, but the data doesn't, we don't make a lot of use with the data. So what we've started doing now is to say, "Okay, what's the most (murmurs) path on our application?" "What is it the customer needs to do?" "What's the journey he needs to go to get his (murmurs)" And that's our most critical. So then we went and we worked with New Relic to say that, "Okay guys." "so help us map this to what's the infrastructure." "What's the application that needs to be up to support this journey?" and we created thresholds on that, and alerting. We're almost at a place now where we've got all the stuff mapped and alerted, and proper actions on that, which is also great. It's helping us to be more pro-active and we rely less and less on our customers to tell us, "Hey, there's a problem on the application." >> Stu: Alright. Lou was talking about all the applications that can be built on top of this platform. I saw the network flows, do we think we're going to see the beer flows by the time we come back a year from now? >> The network flows is great. So I need to do a little bit more deep dive onto the application build, but I can start thinking of a couple of examples where we can really use that to deep a little bit deeper into what the data that we've got day to day. So yeah, that's also exciting in the future. >> Well Dirkie Gertenbach, thank you so much for sharing what your groups going through at InBev. Thanks so much for joining us. >> Great. Thank you Stu. >> Alright, and lot's more coverage here at New Relic, Futurestack, in New York city. I'm Stu Miniman and thanks for watching theCUBE.

Published Date : Sep 19 2019

SUMMARY :

Brought to you by New Relic. and the theCUBE's exclusive coverage I think most people understand AB InBev you know, and we look specifically at the e-commerce side of it. goes from a couple of the largest known brands, and we've been implementing it in other countries and then, you know, what tool sets One of the other things that we are excited about So first of all, you know, are you using New Relic One and what you think of the vision of, as Lou said, and the visibility that we can give to our stakeholders. I was wondering if you could bring us inside and just the visibility that New Relic gives us things announced that had you excited, and the partnership that New Relic is staring with SAP now, that you haven't seen yet? that before we can even think about it. What are you hoping to get our of the day? before we can actually say what we want and the jobs that they do? "What's the application that needs to be up by the time we come back a year from now? So I need to do a little bit more deep dive thank you so much for sharing Thank you Stu. Alright, and lot's more coverage here

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Lew Cirne, New Relic | AWS re:Invent 2018


 

Oh from Las Vegas it's the cube covering AWS reinvents 2018 brought to you by Amazon Web Services Intel and their ecosystem partners well good morning welcome back to AWS reinvent this is day three of our coverage here on the cube we made it we have survived the show here that been a great show and still a lot of energy out here on the show floor Justin Morin John wall's we're with loose Ernie who is the CEO and founder of New Relic and and Luffy look just over your left shoulder there's that really impressive New Relic Pavillion you've got there we've been admiring it all week so that's a great show for us and you know our our theme this yours is billed fast and break nothing because that's really the objective of moving to the cloud is building software that customers value as rapidly as possible when you're building stuff fast there's risk and so how do you build fast with breaking nothing it's measuring everything in real time everything in that environment seeing exactly what's going on so you can make sure the stuff you're building works for your customers and that's what we do for so many people were adopting the Amazon Cloud kind of reminds me of John Wooden yield UCLA basketball coach had said be quick but don't hurry that's all right so that's right so it was all about pace and I understand putting that culture in the team so how do you put that culture and into with your well I you know it's it's one of the great truths how can you manage what you can't measure so we're a company that makes it trivially easy to measure software infrastructure digital customer experience our customers come to us every day and say what I love about New Relic is within seconds of setting up my account and and deploying the agent all of a sudden production is lit up I can see what's going on that measurement helps our customers have more confidence moving to the cloud faster deploying more frequently delivering customer value more rapidly now one of the themes that we've had over the last couple of days and John and I were talking just before we came on this morning that complexity yeah we've been hearing that time and time the amount of change it's happening so quickly and we've got all of these different systems we got micro services we've got containers we've got serverless it's a really complicated environment yeah how do you help the humans understand how how do you get them to understand what's going on in this really complex environment that's moving so fast you're you're absolutely hitting on the key challenge and what we're great at what our customers tell us they love about us is we simplify that complexity and and there's how do we simplify it well we have a deep understanding of how these systems work and we've fought very hard about how do you surface the interesting information that's most relevant to understanding the health and application and really in that moment when there's a problem how do you make it as easy as possible to understand the cause that problem as rapidly as possible this is like our customers they're right in the you know right in the pit of the most high pressure situations when there's a production issue every second counts every second counts you got to find that issue as rapidly as possible and what our customers tell us is they're sick of having to juggle around between three four five many of our customers have dozens of tools that are intended to watch production they turned a new rally platform cause it's all in one platform and when seconds matter you don't want to be switching between tools and context to understand what the nature the problem is and that's that's super important it's kind of like we all become pack rats in a way right yeah we save things we just keep putting them in this room and this room in this room and it comes time to kind of clean up or yeah get our act together and that's what you're doing for people is helping them get their act together absolutely and once you've got an understanding of how the system provides you go from overly cautious and timid to confident and with that confidence you can start playing offense with software we talk about all the time 15 20 years ago IT leaders thought of software as a defensive mechanism when I say defense I mean it's a way to reduce costs how do I reduce the cost of billing how do I reduce the cost of handling a support call now it's offense it's the growth engine for these companies right the digital customer experience is driving top-line growth and so when you're confident your ability to move fast with your software you're actually participating to growth your company that's why it's so strategic that's why the cloud is growing so rapidly so if you've got a customer who's not with you really clearly you want them to they should be going with you what if what does it feel like to go from not having New Relic in there and dealing with this complexity and having those struggles and then as you've put in New Relic for the first time what's what's that onboarding experience feel like I once was blind and now I see John Newton America it's truly that our customers tell us that before I discovered new relic I had no idea was going on production and it was opinions that we're telling us what was going on and when you've got a bunch of teams working on a complex system and there's a problem and it's like the loudest opinions gonna determine how you go forward that results in chaos and it results in organizational misalignment and with data all of a sudden people are lying on how you move forward yeah so with all that data that's there I mean that that can actually be complex itself if I'm trying to see everything all at once that that can be overwhelming so how do you help customers dial in on what's actually important within this this sea of information that they can now now look at well you know we have a variety of ways in which we approach that problem um the first is an opinionated user interface okay we have more experience in the realm you know my first company I founded in 1998 created the category of application performance management and so I've been thinking about this problem might ease the think about this problem for a long time we come to our customers with an opinion on what matters in the application environment but even then beyond that we're layering on well AI but we call it applied intelligence because artificial intelligence people overuse the term and honestly our customers don't care whether we're using a collaborative filter or good old-fashioned algorithms but they want to split more smarts in our platform to tell them what's anomalous tell them what's abnormal tell them what to pay attention to in this sea of data you really collects about 15 million data points every second off of our customers applications and infrastructure and digital customer experiences 15 million data points every second coming to the New Relic Cloud and we analyze all of it in real time to service to our customers what's important what's anomalous and what's interesting yeah so let's get into that let's go about what's anomalous and what's interesting yeah how do you differentiate that because as you said out of 15 million data points every second yeah I mean you're gonna develop trends but but it's by the time you evaluate it seems like one set of data you're off to a completely different set of data and you're right this is a very dynamic environment well the combination of an understanding of how applications work in general but then the flexibility to recognize you know how an e-commerce application might be very different from a Content application like USA Today networks is a big New Relic customer and so we need to provide enough of a platform that our customers can give New Relic some guidance on the nature of their application and and and we can discover its architecture and we can discover things about it but we we really can't discover its business purpose and so there's a combination of what we do out of the box with the customizability that that get our customers the point where the software's doing the work for them you're on so having been in the show now for three four days what have you seen around here what a customer's looking at that they're gonna bring it bring it on to their environment next what are some of the things I think you know lambda is coming mainstream right right and so when we think about where where the world is going you know micro services are going to be here for a while just like all the other technologies you said like the packrat analogy is true but future in the future when someone starts a brand new project they won't even think about infrastructure they'll just think about their code and new relics philosophy on visibility is you start with the software because the software is that the whole the business logic the whole point of all this infrastructure is to run software and so our most important starting point for visibility is the software itself we just made an announcement this week about delivering the first product that automatically instrument lambda to tell you if your lambda function is misbehaving exactly how is it doing that and so as the world continually moves from the old IT used to obsess on infrastructure and and and and new ideas is obsesses on how do we deliver more software faster and that that aligns very well with what we're great what our philosophy is on delivering his ability it starts and ends with the software and it feels like people are going into lambda really quite quickly because absolutely moving with some meetings this morning that they were saying that there's enterprises in particular may not have actually jumped onto the container bandwagon yet but they've looking at laminate is going you know what we're just gonna skip leapfrog to that yeah I'm seeing quite a bit of that containers still have an awful lot of value there they're wonderful lightweight ways to host what used to be on you know in a virtualized environment and get that isolation all that benefit kubernetes is also a big deal we made an acquisition of a company called coast scale that we announced last quarter that accelerates our capability to do work in kubernetes environments we're always inspired by what our customers are doing to accelerate how they build their software and that inspires us to make sure our platforms continually their tool a choice to make sure they can see the entire environment so you're getting as much for them as they're getting from you absolutely it's a great partnership we have with our customers we learn from them and then we provide them with thought leadership on how do you think about making sure you're seeing the entire environment so you can spend more time delivering great software and less time debugging it excellent well let's get back to that great booth of your awesome great for being with us we're sharing our a relic story and success on the the last day of the show all right well mate ok all right excellent right loser T joining us you from New Relic back with more here with AWS reinvent you're watching the cube from Las Vegas

Published Date : Dec 5 2018

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Todd Osborne, New Relic & Scott Drossos, Infiniti | AWS Public Sector Summit 2018


 

>> Live, from Washington, D.C., it's theCUBE, covering AWS Public Sector Summit 2018, brought to you by Amazon Web Services and it's ecosystem partners. >> Welcome back to the District, everybody. This is theCUBE, the leader in live tech coverage. My name is Dave Vellante, and I'm here with my cohost, Stu Miniman. Day two of the AWS Public Sector Summit. We saw Teresa Carlson yesterday, a lot of keynotes, we saw the CIA. Todd Osbourne is here, he's the Vice President of Alliances of New Relic, a company that's been smokin' hot, six billion dollar market cap, and really is takin' the world by storm. He's joined by Scott Drossos, who's the president of Infiniti, who is a public sector consultancy. Gentleman, welcome to theCUBE, good to see you. >> Thanks, good to be here. >> Thank you. >> So Todd, you heard me, I mean really, everybody's talkin' about New Relic, stocks been smoking, I read an article recently, "it's got to cool off, it's too hot." So why so hot, what's goin' on, why the appeal of New Relic? >> Well as our CEO Lew Cirne has been on a couple of times talking to you about, every business is becoming a software business in the public sector, which we're here representing at the Amazon public sector event. It's the same thing with agencies and all the digital experiences that are happening across all the government and whether it's education, higher ed, healthcare, any of the DOD or other agencies, there's always some sort of digital experience that folks are having with the citizens that all the agencies and organizations are tryin' to support, and New Relic's right there, right there at the forefront of every one of those digital experiences. Everyone's running software that's modern software, or shifting to that with modern software running microservices, running containers, shifting to the cloud, and anyone deploying that type of software needs to have New Relic as part of their engagement to monitor what's happening at the citizen or the customer level, what's going on in the back end, on through the infrastructure. And New Relic, whether it's a large enterprise that we're out there, like Dunkin' Donuts or Dominos, monitoring their applications and their eCommerce sites, or it's an agency in the public sector space, you got to have New Relic as part of those engagements. >> So Scott, when AWS services first came out, 2006 timeframe, we looked at it, we said okay, this is the future, but as much as it potentially simplifies lives, it brings a lot of new complexities. So you know, Stu and I used to talk about, look, the AWS is awesome, we're big fans, but the ecosystem has to grow. Consultancies have to come out of the woodworks, and help customers really, adopt. So that's really exactly what's happened. I presume that's how Infiniti got started, maybe you could tell us a little bit about the company, and what your value is. >> Sure, thanks Dave, so Infiniti is a 15 year old company. We're originally founded in public sector IT consulting, and we realized several years ago that the world was changing and that we needed to make the shift from IT consulting to cloud services. And so we dove in headfirst with AWS, and we really tried to move to the top of the curve very quickly, and so we were a little bit ahead of our market in public sector, being a public sector focused organization, but we felt it was important to get ahead of the market because now the market really is smokin' hot. But we thought it was important that if we're going to move into the cloud, we wanted to move to the top of the curve, and deal with things like DevOps, migrations, even machine learning, predictive analytics, so we kind of pride ourselves on having some of the largest public sector contracts in the US, even though we're, right now, predominantly California based, California focused. >> And what's your head count? >> We're about a hundred people. >> I mean this is the thing, we're seeing this trend toward a lot of, you know, smaller specialists, are really doing super. Why is that, or how are you able to differentiate from these big global SIs that have tens of thousands, hundreds of thousands of employees, vertical expertise, why are you guys winning? >> Well, first of all, I think we're able to be nimble and shift our focus pretty quickly to serve our market, to serve our customers, I think more successfully. But one of the thing's that's changed when the cloud arrived, is the cloud really let smaller organizations like us, act like big organizations, so we didn't need to go deploy millions of dollars of capital to go set up a massive data center, we can build an environment on the fly, as you know, in the cloud, and we can have access to world-class platform tools like New Relic, and we can help a customer, a large customer, perform just as well as if we were a large multi-billion dollar services organization. >> Todd, one of the interesting things to talk to customers about is their journey, and where are they, and the cloud migration and how do they do this, reinvent? A year ago or two I heard there were like seven or nine ARS to get there, anything from the full refactoring and building cool new stuff with server lists and things like that, to just the re-platforming. Lift and shift, is that a good thing, isn't that? Walk us through how New Relic with Infiniti, how are you involved in some of those migrations? There's no typical customer, but give us some examples. >> Yeah absolutely, so Infiniti, just like many of the integrators that we work with are all delivering services generally in a couple different areas. One is typically a cloud adoption, or cloud migration practice. So working with Amazon, how do we get more and more of customer's workloads shifted to the cloud? Usually those projects are also going on with something in the refactoring world or application space. Usually they're also developing or shifting to some sort of DevOps practice, and that's also part of our sweet spot, what's happening in the application there, whether it's on the cloud yet or not, we're going to provide that visibility to that. And then the third piece is, there's usually something else happening with that, as I was mentioning before, the customer experience or the citizen experience, so what's the browser impact, what's the user experience on that, what's the, if it's on a mobile app, what's the user experience on there? So while Infiniti's delivering all those services for the clients, New Relic's part of all those services, so our whole model that we're tryin' to do with all of our partners is embed ourselves into all of those services, such that we can help Infiniti be more successful, deliver those projects on time, and really resolve any issues that may come up during those migration issues. >> Scott, I'd love to hear especially, I know I hear DevOps talked about a lot in New Relic's customers, is it pervasive around the agencies that you work with and please do add some color there too. >> So in the public sector, it's a range of readiness, but we're seeing a real wave building, we believe. We worked with New Relic on a very large DevOps, SysOps, very complex cloud services engagement, largest higher education cloud services engagement in the US, and in that case, just like Todd was referencing, when we implemented the migration of the legacy platform to the cloud, first of all we had to do, make choices around refactory, host, rearchitect and so forth, but then when we're managing that environment, and there's millions of users hitting that environment, we need to be able to make sure that we can monitor the application to make sure the application's performing well, and if there's an issue, we want to see the line of code that's causing the problem as quickly as possible so we can keep the environment up all the time. Even though public sector may not be driven by the same financials as say, commercial, they still expect to be up all the time. They still want to take advantage of the benefits of the cloud and so New Relic allows us to do that, but then, as we're looking at the users interface with the application environment, New Relic's browser and mobile, they let us monitor how that experience is going, and we can proactively get at the performance issues there that the application may not tell us, if there's an issue there. And then, we can do things like test middleware with synthetics and make sure that the whole environment's working, and then obviously on the infrastructure side, it lets us make sure that we're optimizing the environment for our clients. One of the cool thing is, when you in the past, you'd set up an EC2 instance, you may not see that you don't need as much CPU as you're using, and so you can size that appropriately, and allow your environment to still run at a high performance, 100% up time, but give them the cost efficiencies at the same time. So we use New Relic across board to help support the entire environment. >> I wonder if we could talk about the marketplace a little bit, generally and then specifically, the public sector? So Scott, I presume you're obviously public sector focused, but are you exclusive to AWS, no, you probably do some other stuff, is that right, is that fair? >> Well we are both AWS and Azure Gold, in terms of partner, but we do more of our work in AWS for sure. >> Okay, so we'll come back to that. And New Relic, of course you're a software company, so you want everybody to love your software, so if there's a cloud that a customer wants to use, you want your software to be on that cloud, fair enough? >> Sure, and also on PRIM, I mean a lot of our... >> On PRIM too. >> A lot of our applications we monitor are still on PRIM, and there's a tremendous amount of value there regardless of... >> I would just add, Infiniti is a trusted advisor, we like to see ourselves as a trusted advisor, so we do feel like we have to be multi-cloud and have an objective perspective. >> And New Relic is presumably the same way, I mean let the customers decide, so, and it's a hybrid world, folks, despite what Amazon wants, it's a hybrid world, and they even recognize that. My question is, there's a lot of discussion in the industry about Amazon as an infrastructure service provider and their lead or relative lead on the competition. It's our sense that there's still a lead there, what's your sense? >> Well AWS is still the leading cloud services provider in the marketplace. They lead in innovation, they lead in disruption, they lead in market share, they lead in so many metrics, and because they have that lead, and that's where we started, we've benefited from that, and we've invested heavily, and in the same way, we see New Relic, when we made a choice around who we were going to pick as a platform to support our customers, we wanted something that was cloud-born, didn't come out of on-premise and get sort of bootstrapped into the cloud, and we wanted something that was a complete platform. So New Relic was really a clear choice for us. It was not a, we looked at the entire market when we made that choice. >> So the narrative in the market used to be, oh, security in the cloud, now we hear the CIA say hey, security on the worst day in Amazon's cloud is way better than I ever saw with client server. It was a pretty powerful statement, so let's assume security, people are relatively comfortable with security these days, even though I'm sure there's still some issues with regard to corporate edicts, and flexibility, and audits, let's put that aside. SLAs is another big one. People often criticize the public cloud SLAs, and cost, oh it's so expensive, I can do it cheaper on PRIM. Are those myths, are those realities, is it a it depends? What's your sense? >> I mean they're all, they're all factors that all of our customers are looking into. I would say what we're hearing a lot about right now, is how do we help provide more visibility to everything that's happening, so if you've got a developer now that has the ability to write code, put it on any cloud they want, spin up containers, spin down containers, go try out server-less base of architectures, they've got a lot of flexibility to do what they want. Government agencies, as well as customers, one of the things they're looking for is what's actually happening? Who's doing what? The governance piece is a big piece and I think New Relic plays right into that in terms of helping control all that. One of the things that we're, is one of our sweet spots, is as you move to DevOps and a truly microservices architecture, one of the whole values of that is speed, keeping up with how fast the whole market is moving, and customers and agencies, what they want out of that, is to deploy applications where they're releasing multiple times a day. You have to have visibility into everything you're doing across the stack to be successful in that, and that's really New Relic's sweet spot in terms of doing that. So providing that visibility, instrumenting the applications in the infrastructure before, and then helping provide visibility to things like governance, things that other, not necessarily our sweet spot, but other companies in the industry are doing things throughout the DevOps life cycle in the governance realm, things like that. So we're part of that ecosystem that's helping Amazon and the other cloud providers be very successful, helping customers and agencies be very successful deploying modern applications. >> It's all about that visibility. >> Scott, one of the things, when we look at any rollout of new technology or migration, once it's up and running, then what, so wondering how your firm's involved in, you know, is there re-training, is there things go on, once this is in place, now what? >> Well Infiniti, what we found in public sector is that everybody wants to take advantage of the cost efficiencies and the benefits, and most public sector isn't going to reduce cost, they're just going to want to re-use cost more wisely. So some of the confusion around cost savings is that they're getting way more for their dollar in the future state, and the choices you have to make around how fast you want to get to the cloud, and what you want to get out of the cloud when you're there, those all effect the equation in terms of what you're actually outcomes are immediately and in the long term. So we often see that in public sector, some of the legacy applications, they may not naturally or easily move all at once, and so you have to make a choice, are you going to do some refactory and architecting before you get it there, are you going to get in the cloud now, and then do it afterwards. Either way, there's benefits, but you have to make choices about what, how you want to approach it. >> Yeah, when you talk about, after I've rolled this in, I've heard from some customers, they're like, after I've gotten a cloud, I love it, but I had to dedicate an engineer for financial architecting because there's all of these things we need to do. Are we still in that state? And once again, do you help with some of the training as to, okay, or is it plugging them into the Amazon ecosystem and how do they get certified and ready to use all of this. >> So Infiniti works with clients differently, we work with some in a more episodic, lighter capacity, and we work with some in a wholistic capacity where we are that engine for them, where we provide them the complete cloud services team to do everything from migrations, architecture, DevOps, SysOps, SecOps, machine learning and all the way through. And so when we're providing those services, we're doing those kind of things, we're making sure that the next improvement is worked into the architecture. Last year, the customer I was referencing earlier, we did just under a hundred releases, so that's a hundred releases that we're using the New Relic platform and our architectural solution, our solution architects, rather, to make sure that it's faultless, that the process is efficient, it's effective, it's secure, and that we're driving efficiencies wherever possible. So it really depends on what the customer wants. If the customer wants to hone the environment, they may have to go a little slower to account for their learning, their learning curve, and we'll help them, if that's what they want, but if they want to go faster, and they want to take advantage of our expertise, we make that available, and we're happy to do that. >> We had the former CTO of the NSA on yesterday, who now works for Accenture, and we were asking about sort of, federal versus commercial, are we sort of still taking, learning lessons from commercial and bringing it to federal, or is it because federal has so much interesting technology around analytics, does it go the other way, and he said, "it's funny, when you're on the inside, you think all the innovation is goin' on outside, now that I'm on the outside I say wow, there's a lot of interesting stuff going on in federal." We heard Teresa yesterday talk about Aurora, she talked about the VM wear partnership, so things that were announced a while ago and actually being adopted in commercial coming in to federal. So how does it work? Is it more of a two-way than it used to be 20 years ago and I wonder if you could comment? >> Yeah, from Infiniti's perspective, absolutely. We work with clients to understand the problems and where they want to get to, and then we innovate with them. You're pretty dependent on the subject matter expertise of the organization. I think our customers like that, they like that they're part of the solution, but then they need the expertise that we bring to create the next generation solution. We just created something in the higher ed space called, a college called Architecture Builder, and it was after teaming with a specific college, and working in that space for a long time, but we wanted to create a way for colleges to rapidly implement a complete architecture integrated with all the different things, including New Relic, quickly and successfully, and that was done in partnership with them, so we did the work, but we couldn't have done it without them. >> Todd, New Relic obviously, you're a believer, you drink the Koolaid every day. Why New Relic relative to the competition? How do you guys differentiate? Pitch me. >> So it's really all about being successful in that modern software space, again, as I've mentioned, and so New Relic is the only SAS only platform, so we're not going to put anything on PRIM. We've got ourselves one of the biggest and best DevOps team that develops our software, we roll code everyday, and our customers get the benefit of us being a pure SAS platform. Part of that is scalability. What we can do at scale is unbelievable. There was a customer that was just talked about on the news today that I can't mention, but they just went from basically zero to $100 million on an application just in the past 90 days. It's one of our customers and we've scaled, we have no problem scaling with customers that are doing things like that, and again, the full platform value that we have now, looking at everything from the front end on the browser and mobile applications, through the application, which is core to us, it's where we provide that code-level visibility, the ability to trace across all the different microservices that are happening, connected back to that infrastructure. That full platform now provides such tremendous value up and down the stack, but not only to the technology leaders but also to those folks that are business leaders, chief marketing officers, heads of practices at the consultants we work with, all these folks are all getting value out of New Relic. >> What would that customer who should not be named say about the value contribution of New Relic to that scale? >> The value's unbelievable. That's a commercial customer, but their business is taking off like so many of our customer's businesses are at an unbelievable scale. They can't be hamstrung by having to do a server upgrade, or having to go back, working with a release of code from a couple weeks ago, they have to be as fast as possible 'cause their business is moving so fast, their agencies are moving so fast, they need a provider that's going to provide that visibility to that at the speed with which they're moving. >> Awesome so, you got one more? >> No, we've got to run. >> Yeah, we've got to go. So this is the last question, so impressions of AWS Public Sector Summit? I presume you guys, like we did, had to register yesterday. There were some logistic issues, but other than that, maybe you could give us your last word on the summit? >> Well Infiniti is very committed to public sector, so we really enjoy coming to the Public Sector Summit. It's great to connect with our partners, like New Relic and others, and it's great to see the latest innovations coming out from AWS. >> Yeah and I've been to, I don't know, 10 or so summits around the world so far this year. It is unbelievable the excitement and the amount of people that are now excited about what's happening in the clouded option world, and Amazon's piece in that, and what's happening here in D.C. this week is no exception. >> I would second that. It's been a while since I've been at summits. Stu, you go all the time, and they are just exploding and growing, and this is one of the best that's out there. So thanks guys, for comin' on theCUBE, we really appreciate it. >> Thanks very much. >> Thank you for the opportunity. >> You're welcome. Alright, keep it right there everybody, Stu and I will be back with our next guest after this short break. John Furrier's here, you're watchin' theCUBE live, from AWS Public Sector Summit. We'll be right back. (upbeat music)

Published Date : Jun 21 2018

SUMMARY :

brought to you by Amazon Web Services Todd Osbourne is here, he's the Vice President of Alliances So Todd, you heard me, I mean really, everybody's talkin' or it's an agency in the public sector space, you got to have So you know, Stu and I used to talk about, look, the AWS into the cloud, we wanted to move to the top of the curve, Why is that, or how are you able to differentiate on the fly, as you know, in the cloud, and we can have Todd, one of the interesting things to talk to customers of the integrators that we work with are all delivering around the agencies that you work with and please do add One of the cool thing is, when you in the past, of partner, but we do more of our work in AWS for sure. so you want everybody to love your software, Sure, and also on PRIM, I mean A lot of our applications we monitor are still on PRIM, Infiniti is a trusted advisor, we like to see ourselves And New Relic is presumably the same way, I mean let heavily, and in the same way, we see New Relic, security in the cloud, now we hear the CIA say hey, that has the ability to write code, put it on any cloud in the future state, and the choices you have to make and ready to use all of this. the complete cloud services team to do everything now that I'm on the outside I say wow, there's a lot and then we innovate with them. Why New Relic relative to the competition? and so New Relic is the only SAS only platform, at the speed with which they're moving. I presume you guys, like we did, had to register yesterday. and others, and it's great to see the latest innovations around the world so far this year. and growing, and this is one of the best that's out there. will be back with our next guest after this short break.

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Robson Grieve, New Relic Inc. | CUBE Conversations Jan 2018


 

(fast-paced instrumental music) >> Hello everyone, welcome to the special CUBE conversation, here at theCUBE Studio in Palo Alto. I'm John Furrier, Co-founder of SiliconANGLE Media and host of theCUBE for our special CMO signal series we're launching. Really talkin' to the top thought leaders in marketing, in the industry, really pushing the envelope on a lot of experimentation. And Robson Grieve, Chief Marketing Officer of New Relic, is here. Welcome to this CUBE conversation. >> Thank you, excited to be with you. >> So, New Relic is a very progressive company. You have a founder who's very dynamic, writes code, takes sabbaticals, creates product, he's a musician, is prolific. That kind of sets the tone for your company, and you guys are also state of the art DevOps company. >> Robson: Yes. >> So, pressure's on to be a progressive marketer, you guys are doing that. >> Yeah, I think some of the great things about that DevOps culture are process wise it allows us to experiment with different ways of working. And we've obviously talked a little bit about Agile and the way a different way of thinking about how you actually do the work can change the way you output the kind of things you're willing to make, the way the teams work together. And the degree to which you can integrate marketing and sales, really, around shorter time frames, faster cycle times. And so, we have a great culture around that. We also have a really great culture around experimentation. I think that's one of the biggest things that Lou talks a lot about is, let's try things, let's look for experiments, let's see where we can find something unexpected that could be a big success, and let's not be afraid for something to go wrong. If you can do that, then you have way higher odds of finding the Geo TenX. >> And you guys are also in the analytics, you also look at the signal, so you're very data driven, and I'll give you a prop for that, give you a plug. (Robson laughing) New Relic, a very data driven company. But today we're seeing a Seed Changer, a revolution in the tech industry. Seeing signals like cryptocurrency, blockchain, everyone's goin' crazy for this. They see disruption in that. You've got AI and a bunch of other things, so, and you got the Cloud computing revolution, so all of this is causing a lot of horizontally, scalable change, which is breaking down the silos of existing systems. >> Yeah. >> But, you can't just throw systems away. You have systems in marketing. So, how are you dealing with that dynamic, because we're seeing people going, hey, I just can't throw away my systems, but I got to really be innovative and agile to the real-time nature of the internet now, while having all those analytics available. >> Yeah. >> How do you tackle that, that issue? >> Yeah, there's a couple ways to think about analytics. Number one is, what do you need to know in real-time to make sure things are working and that your systems are up and running and operating effectively? And that runs through everything from upfront in web experiences and trial experiences, that kind of thing. Through to how our leads and customers progressing through a funnel, as they get passed around the various parts of a company. But then the second approach we take to data is, after all that's happened, how can we look backwards on it and what patterns emerge when you look at it over the scale of longer period of time. And so, that's the approach today. You're right, you can't just everything and throw it out and start over again, 'cause some startups stop by with a really cool idea. But, you have to be aggressive about experimentation. I think that's the, back to that big idea that we talked about experimentation. We are trying out a lot of different things all the time. Looking for things that could be really successful. Of course, Intercom is one that we started to experiment with a little bit for in product communications and we've expanded over time as we found it more and more useful. And, so that's not, we haven't taken and just ripped something else out of it, made some giant bet on something brand new. We've tried it, we've gotten to know it, and then we found ways to apply that. We're doing that with a number of different technologies right now. >> Yeah, you're in a very powerful position, you're Chief Marketing Officer, which has to look over a lot of things now, and certainly with IT and Cloud. You're essentially in the middle of the fabric of the organization. Plus, people are knockin' on your door to sell you stuff. >> Yeah. (laughing) >> So, what is-- >> That's happened. (laughing) >> It happens all the time, he's got the big budget. >> What are they saying to you? Who's knockin' on your door, right now? Who's peppering you. Who's tryin' to get on your calendar? Who's bombarding you? Where are you saying, Hey, I'm done with that, or Hey, I'm lookin' for more of that. How do you deal with that tension, 'cause I'm sure it must be heavy. >> Yeah, I think there is definitely a lot of optionality in the market, for sure. I think there's a new wave of martech vendors. Many of whom are sitting right in between sales ops and marketing ops. That's a layer we're really interested in. Systems that can help us better understand the behavior of sale's reps, and how they're using things that we're making, and then systems that you can better understand, indications of prospect intent. >> So, funnel and pipeline, or those kinds of things? >> Yeah, we think about it more from the context of authentic engagement. And so, we don't want to apply too much of a-- >> Structure to it. >> Structure, a sales structure to it. We want to try to follow the customer's intent through the process, 'cause the best prospect is someone who is authentically engaged in trying to find a solution to their problem. And so, if we can avail ourselves to people in a thoughtful, and creative, and authentic way, when they need us, when they're trying to solve that problem, then I think that they can become much more successful prospects. >> I love your angle on agile marketing. I think that's table steaks, not that you got to behave that way, and I'd love to get your thoughts, I'll get your thoughts later on the management style and how you make that happen. But, you mentioned engagement, this is now the new Holy Grail. There's a lot of data behind it, and it could be hidden data, it could be data decentralized all over the place. This is the hottest topic. How do you view engagement as a CMO, and the impact to the organization? What are you lookin' for, what's the key premise for your thesis of getting engagement? >> It's really the number one, two, and three topic we're talking about right now, and we think about it on the content side. How do we get ourselves really producing a constant stream of content that has value to people? That either helps them solve a problem right now, or helps them think about an architectural issue in a different way. We're trying to invest more and more technical resources in people who can produce things that are relevant to all the different kinds of users that we have. DevOps people, SREs, our traditional developer customers. We want to go deep and be super relevant at a content level for them. But then once they start to spend time with us, we want to then have a progressive way to pull them deeper and deeper into our community. And so, the things that we can do, something's in digital for that, but then often there's a pop off line, and we do a lot of workshops, a lot of education. >> Face-to-face? >> Face-to-face, where we're in communities, we look at a map at the start of the year and say, where do we have big user communities, and then we drop events into those places where we take our educators and our product experts and get customers to share with each other. And that becomes a really great platform to put them together and have them help each other, as well as learn more about what our product does. >> So, it sounds like you're blending digital with face-to-face? >> Robson: Yeah, absolutely. >> That's a key part of your strategy? >> Key part is to make sure that we're getting time and attention from the people who are making decisions, and what technologies they're going to buy, but also that we're really investing time in the people who are using it in their everyday lives to do their job better. That's a really-- >> Give some examples of outcomes that you've seen successful from that force. That's a really unique, well unique is pretty obvious if you think about it, but some people think digital is the Holy Grail, let's go digital, let's lower cost. But, face-to-face can be expensive, but you're blending it. What's the formula and what are some of the successes that you've seen as a result. >> Yeah, we tend to try to create events that are good for a very specific audience. So, if you think about a targeting formula that you would use in digital that will make digital really efficient, that same idea works really well for an event. So, if you got a user community that's really good at doing one thing with your product and you feel like if they knew a few more things that they could get better. Then we help them really advance to the next level, and so we run certification programs, where we'll pull together a group of confident users and help them get to the next level. And things like that allow us to make a really targeted event that allows us to reach out to a group and move them to a higher level of competency. To have competency focus is a big deal. Can we help you get better at your job? But then communities, is the other big one. Can we help you connect with people who are doing the same things? Solving the same kinds of problems and are interested in the same topics as you are. >> It sounds like the discovery path of the user, the journey, your potential. >> Yeah, it's important to us for sure. >> And content sounds like it's important too. >> It helps with your engagement. How you dealing with the content? Is that all on your properties? How about off property measurement? How do you get engagement for off property? >> Yeah, we're experimenting a lot in that area, of off property. I think we've had tons of success inside our own website and our blogs, and those kinds of-- >> You guys do pop out a lot of content, so it's content rich. >> Yes, we definitely have a lot, we hopefully, our attitude is, we want to turn our company inside out, so we want to take all of our experts-- >> Explain that, that's important topic, so, you guys are opening up what? >> We have got customer support people, we have technical sales, and technical support engineers, we've got marketing people who are thought leaders in Cloud and other architecture topics. We really want to take all the expertise that they've got and we want to share it with our community. >> John: How do you do that, through forums, through their Twitter handles? >> Through all of the above, really. Through their Twitter handles, through content that they write and produce through videos, through a podcast series that we run. We're really trying to expand as much as possible, but then inside our user help community, anytime somebody solves a problem for one customer, we want to add it to that-- >> Sounds like open-source, software. (laughing) >> From a knowledge perspective, that's really an important idea for us. >> Yeah, that's awesome. You worry about the risk. I like the idea of just opening it up. You're creating building blocks of knowledge, like code. It's almost like an open-source software, but no, it's open knowledge. >> We think if we can help people get really successful at the work they're trying to do, that it's going to do great things for us as a brand. >> What's the rules of the road, because obviously you might have some hay makers out there. Some employee goes rogue, or you guys just trusting everyone, just go out and just do it. >> Well, it's constant effort to distribute publishing rights and allow people to take more and more ownership of it, and to maintain some editorial controls, because I think quality is a big thing. It's probably a bigger concern for us then somebody going rogue. At some level, if that happens to you, you can't stop it. >> So, is this a new initiative or is it progression? >> It's been ongoing for awhile. It's progression of an effort we started probably 18 months ago, and it's a wonderful way for an engineering team, and a product management team, and a marketing team to get together around a really unified mission as well. So our content project is just one of those things that I think really pulls us together inside the company in a really fun way as well. >> It's interesting, you seeing more and more what social peers want to talk to each other and not the marketing guy, and say, Hey, get the Kool-Aid, I like the product, I want to talk to someone to solve my problem. >> Want to have a real conversation about it, and I think that's our job, is to not think of it as marketing, but to think of it as just facilitating a real conversation about how our product works for somebody. >> I'd love to talk about leadership as the Chief Marketer for New Relic in the culture that you're in, which is very cool to be in on the front-end, in the front lines doing cool things. What do you do? How do you manage yourself, how do you manage your time? What do you do, how do you organize the troops, how do you motivate them? What's your management style for this marketing in the modern era? >> I think, number one, we're trying to create an organization that is full of opportunities for people, so it's something that we've done. I've been there for about two and a half years, and we've really looked hard for people who have tons of potential and finding great things to work on. On new projects, and then let them try out ideas that they've got. So, if they can own an idea, give it a shot, and even if it doesn't work, they'll learn a bunch from the process of trying. >> What are the craziest ideas you've heard from some of your staff? (laughing) >> Oh boy, you know a lot of them involve video. There's always a great idea for a video that's risky. And we've made-- >> So the Burger King one with Net Neutrality going around the web is the funniest video I've seen all week. >> Robson: Yeah, yeah. >> Could be risky, could be also a double-edged sword, right? >> Yeah, video is one of those places where you have to check yourself a little bit, 'cause it could be a great idea, and so sometimes you have to actually make it and look at it, and say, would we publish this or not? And, yeah, so that's definitely the place to be. >> So common sense is kind of like your. >> Yeah, you start with common sense, for sure. And, I think we want to be a part of it being culturally responsible in Silicon Valley right now, is really making sure that we're attentive to making sure that we're putting in the right kind of workplace environment for people. And so, our content and the way we go to market has to reflect that as well, so there's a bunch of filters that you put on it, but you have to take risks and try to make things, and if they work great, and if they don't then the cost of that is less than. The cost of failure is so low in some of these things, so you just have to try. >> Well, you know, we're into video here at theCUBE. I have to ask you, do you see video more and more in the marketing mix and if so, how does that compare to old methods? We've seen the media business change and journalism, certainly on the analyst community. Who reads white papers? Maybe the do, maybe they don't. Or, how do they engage? What content formally do you see as state of the art engagement? Is is video, is it a mix, how do you view that? >> It's a mix, really. I think video's really powerful. And it can be great to tree topics and short form in a really powerful way. I think we can stretch it out a little bit in terms of how to and teaching and education also. But, there are times when other things like a white paper are still relevant. >> Yeah, they got to do their homework and get ready for the big test. >> Yes. >> How to install. (laughing) >> Exactly, yeah. >> Okay, big surprises for you in the industry, if you could look back and talk to yourself a few years ago and say, Wow, I didn't know that was going to happen, or I kind of knew this was going to be a trend we would be on. Where is the tailwinds, where's the headwinds in the industry as a marketer to be innovated, to be on the cutting edge, to deliver the value you need to do for your customers and for the company? >> Yeah, I think there's a bunch of great tailwinds organizationally and in the approach to work. And you talked about Agile. I think it's been a great thing to see people jump in and try to work in a different way. That's created tons of scale for a department like ours, where we're tryin' to go to more countries, and more places constantly. Having a better way to work, where we waste less effort, where we find problems and fix things way faster, has given us the chance to build leverage. And I think that's just that integration of engineering, attitudes, with marketing processes has been a, is an awesome thing. Everybody in our marketing department, or at least a lot of people have read the DevOps handbook, and we've got a lot of readers, so the devotes of that thought process that don't suit an engineering jobs. >> DevOps, Ethos, I think is going to be looked at as one of those things, that's a moment in history that has changed so much. I was just at Sundance Film Festival, and DevOps, Ethos is going to filmmaking. >> Robson: Yeah. >> And artistry with a craft and how that waterfall for the Elite Studios is opening up an amateur market in the Indy, so their Agile filmmakers and artists now doing cool stuff. So, it's going to happen. And of course, we love the infrastructures code. We'll talk about that all day long We love DevOps. (Robson laughing) So I got to ask you the marketing question. It will be a theme of my program of the CMO is, if I say marketing is code, infrastructure is code, enabled a lot of automation, some abstracted a way horizontally scaled, and new opportunities, created a lot of leverage, a lot of value, infrastructures code, created the Cloud. Is there a marketing as code Ethos, and what would that look like? If I would say, apply DevOps to marketing. If you could look at that, and you could say, magic wand. Give me some DevOps marketing, marketing as code. What would you have automated in a way that would be available to you? What would the APIs look like? What's your vision for that? >> What about the APIs, that's a good question. >> John: I don't think they exist yet, but we're fantasizing about it. (laughing) >> Yeah, I think the things that tend to slow marketing departments down really are old school, things like approvals. And how hard it is to get humans to agree on things that should be really easy. So, if the first thing you-- >> Provisioning an order. (laughing) >> The first thing you could do is just automate that system of agreeing that something's ready to go and send it out that I think you'd create so much efficiency in side marketing departments all over the world. Now that involves having a really great, and API's a great thought in that, because the expectations have to get matched up of what's being communicated on both sides, so we can have a channel on which to agree on something. That to me is-- >> Analytics are probably huge too. You want to have instant analytics. I don't care which database it came from. >> Yes, exactly. And that's the sense of DevOps and can use. But then you got some feedback on, did it work, was it the right thing to do, should we do more of it, should we fix it in some specific way? Yeah, I think that's-- >> I think that's an interesting angle, and the face-to-face thing that I find really interesting, because what you're doing is creating that face-to-face resource, that value is so intimate, and it's the best engagement data you can get is face-to-face. >> Yeah, I think it also allows us to build relationships to the point where we are getting invited into slack channels to help companies in real-time sometimes. I think there's a real-- >> So humanizing the company and the employees is critical. >> Yeah. >> You can't just be digital. >> Yes, it's a big deal. >> Awesome. Robson, thank so much for coming on theCUBE. The special CMO series. Is there a DevOps, can we automate away, what's going to automate, where's the value going to be in marketing? Super exciting, again, martech. Some are sayin' it's changing rapidly with the Cloud, AI, and all these awesome new technologies. What's going to change, that's what we're going to be exploring here on the CMO CUBE conversation. I'm John Furrier, thanks for watching. (upbeat instrumental music)

Published Date : Jan 26 2018

SUMMARY :

and host of theCUBE for our special CMO signal series and you guys are also state of the art DevOps company. So, pressure's on to be a progressive marketer, And the degree to which you can integrate marketing and you got the Cloud computing revolution, and agile to the real-time nature of the internet now, and what patterns emerge when you look of the organization. (laughing) How do you deal with that tension, that you can better understand, And so, we don't want to apply too much of a-- And so, if we can avail ourselves to people in a thoughtful, and the impact to the organization? And so, the things that we can do, and get customers to share with each other. Key part is to make sure that we're getting What's the formula and what are some of the successes and are interested in the same topics as you are. the journey, your potential. How do you get engagement for off property? and our blogs, and those kinds of-- so it's content rich. and we want to share it with our community. Through all of the above, really. (laughing) From a knowledge perspective, I like the idea of just opening it up. that it's going to do great things for us as a brand. or you guys just trusting everyone, and to maintain some editorial controls, and a marketing team to get together and not the marketing guy, and say, Hey, get the Kool-Aid, and I think that's our job, What do you do, how do you organize the troops, and finding great things to work on. Oh boy, you know a lot of them involve video. So the Burger King one with Net Neutrality going and so sometimes you have to actually make it And so, our content and the way we go to market and more in the marketing mix and if so, I think we can stretch it out a little bit in terms and get ready for the big test. How to install. in the industry as a marketer to be innovated, organizationally and in the approach to work. DevOps, Ethos, I think is going to be looked at as So I got to ask you the marketing question. John: I don't think they exist yet, Yeah, I think the things that tend to (laughing) because the expectations have to get matched up of I don't care which database it came from. And that's the sense of DevOps and can use. and it's the best engagement data to the point where we are getting invited into here on the CMO CUBE conversation.

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Lew Cirne, New Relic | AWS re:Invent 2017


 

(upbeat instrumental music) >> Narrator: Live from Las Vegas, it's the Cube. Covering AWS re:Invent 2017, presented by AWS, Intel, and our ecosystem of partners. >> Hey, welcome back everyone. This is the Cube, live here in Las Vegas for AWS re:Invent 2017. I'm John Furrier, the cohost of the cube. My cohost, Keith Townsend, here for our fifth year in a row, covering the thunderous growth of Amazon Web Services as they continue to not only nail the developers and the start ups, but continue to win the enterprise. Our next guest, Lew Cirne, who's the founder and CEO of publicly held New Relic, a very successful startup, one of the most admired places to work in the Bay area, and in tech. Lew, great to have you on the Cube, welcome. >> Hi. >> John: Hi, first time. >> I know, so great to be here. I can't believe it's the firs time. I've been such a fan for a long time. >> Now you're an alumni, the benefits. >> Here I am. >> All the benefits of being an alumni, all those season tickets to all of our games. I gotta, I want to just share something with the audience out there. You're the only public CEO that I know that's been on the Cube that writes software, has a GitHub account, and manages a publicly held company. So that's a unique thing and I want to just say it's awesome. >> It's a full plate, that's for sure, but I'm the luckiest guy in the world because I've always loved building software since my first computer I got in the Christmas of 82, what's that, 35 years ago now, and, and so, what an exciting time to be someone who's passionate about software and technology. Look what's going on in the cloud, and so I've been fortunate enough to start this company that's participating in this revolution in technology, so it's great. >> You guys are always in the cutting edge. I noticed, you guys get your hands dirty, you get in there, you're coding away, but you guys are very successful in a very important area right now, which is instrumentation of data. >> Lew: Absolutely. >> In applications, so I really want to get your, kind of your thoughts on the landscape. We were talking about on our intro analysis, that we're seeing a renaissance in software development, where with open source growing exponentially, a new software methodology's coming out, where there's just so much going on. Multiple databases within one app, IOT, so a new kind of thinking is evolving. What's your take on that? >> Well I think it's really important to understand why all of this is happening. So why are there 40,000 people here in Las Vegas for re:Invent? Why are people consuming the cloud at just a dizzying pace? It's not just for the sake of cloud computing, it's because there's this business imperative to compete on software, so if you look at where software was 15, 20 years ago, software was a tool to reduce costs and automate things in the back end. Now your software's your business. If you are a large global bank, your app has more to do with your customers' experience and satisfaction than the branch because nobody walks through a branch anymore, so now the best software developing bank is going to be the winner, so if you think about that's what's going on and that's why they're adopting new technologies to move faster, so where do we fit in? If you're going to compete on your software, and by competing you have to build the best stuff, the fastest as possible, so you have to get to market quickly, and that means you've got to change a lot. Anytime you're changing something rapidly, that introduces risk. New Relic de-risks all of that rapid movement by instrumentation, by measuring everything in the software. Those measurements help you move faster with confidence. >> And also I would say that you, not only does that create risks, but new software creates risks, so I'm doing server-less, I want to try the new service because it could A, add value, AKA Lamda or whatever, so a new, maybe time out is needed, so all kinds of new things or elements are going on inside the software stacks. >> Yes, and more complex than ever before, right, so you introduce things like Lambda server-less function computing, call it what you will, and you integrate it with, you know, microservice architecture, and so instead of one monolith, you might have hundreds, or even some of our customers have thousands of independent services, all supposed to be working in flawless concert in order to deliver a great customer experience. How on earth do you make sense of whether that's all working? Well it involves collecting an enormous amount of data about everything that's going on in real time, and then applying intelligence to that data using what we call at New Relic applied intelligence to tell our customers in real time, here's what's working well, and more importantly, here's what's going to be a problem if you don't take immediate action. And that's, you know, that's a hard problem to solve. We think we're the best at doing it. >> And that's critical too, because like you said, if it crashes, or there's some sort of breach hold that comes out there, all the stuff is at risk. >> And like, customers have just incredibly high expectations that only get higher and higher every day. Like, you know, one of our customers is Domino's and it's an amazing thing where you pre-order your pizza and you can see, second by second, how your order is doing, right? They put your pizza in the oven, then they took the pizza out of the oven, and I see that in phone, and that gives, that's that feedback that's valuable to me, right? So long as it's working, right? >> John: I'm hungry now. >> So we, we've ravished this word digital transformation all the time. >> Oh yeah, it's a little overused, but. >> It is a little overused. But melding that physical world with cold. I love it that you're a developer. First off, what's your favorite language? >> Oh geez, it really depends on the project. I'm really getting into, I love React right now on the front end. I'll still do Java when it needs some heavy lifting, Ruby for rapid prototyping. It really depends on the task at hand. >> So the value of reducing friction from a developer seeing a problem, needing to solve that problem, and getting the resources needed to solve a problem, AWS does a wonderful job of saying, you know what, developer, give me your credit card, we'll give you all the tools you need. Where is the first stumbling block because this is new capability, net new over the past few years? Where's the first set of stumbling blocks when developers reduce friction, get to that first level contact with the branch manager of the pizza store, where does it fall apart and New Relic comes in to help? >> Look, how many times have you ever had a developer or a tech or someone that works on my machine, right? >> Exactly, worked on my laptop. I don't know why it didn't deploy well in production, it worked perfectly fine on my laptop. >> I really, I started thinking about and solving this problem 20 years ago now. The notion of less instrument Java code because I was frustrated with the stuff that worked on my laptop. I couldn't understand why it didn't work when a customer used it, and everything prior to the customer using the software is nothing but sunk cost. There is no value in the software you're building until it runs in production. How well it runs in production is what determines the fate of the application. And that's where New Relic comes in, is we feel like alright, let me take you back to the ancient days of like turn of the century, 2000, nothing went to production without QA. Now nothing goes to production without instrumentation. >> Yeah, but now Agile's there, so the old days was a crab. You built a software product, but you didn't know if it was going to work until it went into production with QA. Now you're shipping stuff fast, so it's still. You've got that dev off mindset, but it's in QA. >> One of our customers, Airbnb, deploys more than a thousand times a day. And this is not a small, low load site. I mean like every deploy has to work, otherwise millions of people are impacted and it's the whole business, and it's a big business, so you're talking about a pace of innovation and change that cannot be managed with a traditional QA cycle. I've, of course testing's important, but instrumentation's more important than that. >> Lew, I want to ask you an important question because I asked Andy Jassie this last Monday when I had a one on one with him. A lot of people that are entering ecosystem for Amazon is new, that are new, or considerably, Amazon's the big, they're fearful, it's always going to be that way. He highlighted your company, New Relic, and said they're an amazing part, they do extremely well, even though they introduced Cloud Watch, which because some customers just wanted it, they have monitoring, but you guys are so much better. I said that, but if he implied it, obviously you're doing well. So the successful participation of the ecosystem is there. You can be successful in the Amazon ecosystem. >> Absolutely, it's a great partnership. >> So what's this formula for a new entry coming in or someone who's here that needs to find some white space? How do you read the tea leaves to know where not to play and where to play? >> You know, it just comes down to the fundamental good thought process you use when you're thinking about approaching your customer too. Don't think about what's in it for me, the Amazon partner. What's in it for Amazon? How do you make them more successful? And so when I imagine myself as Andy, who is like, what an incredible job he's done, but what Andy, what's top mind of Andy is how do I get more customers consuming more of Amazon faster, right? All of Amazon, all of Amazon's web services, and so we solve a problem for Andy and his team. We help our customers consume Amazon faster because we give them the confidence to consume more and move faster, and there's data to prove it. When Amazon asks their customers that aren't yet New Relic customers how much they're consuming and how fast, they get a slower rate of adoption than they do for the cohort that uses New Relic, and so it's in our mutual interest to go to market together because we help them consume more, and so I. >> John: Build a good product. >> Build a good product. >> John: Customer value. >> Think about how you help your partner be successful. Talk in that language, don't talk in language. >> Alright, so personal question. So you and I, pretend we're sitting here, having a beer, you're playing the guitar. >> A little light. >> I'm singing some tunes and Keith's our friend. He says I'm in trouble, I'm a CIO. I've got a transformation project. I don't know what to do. Which cloud do I use? How do I become data driven? Guys, help me out. Lew, what do you say? >> I say first of all, you have an instrumentation strategy. Everything, if you're a CIO in a large organization, you don't have one, two, three, or four projects. You have dozens, if not hundreds, sometimes thousands of applications and services that are all running, and you've got, I haven't met a CIO that doesn't say they've got too many monitoring tools. So you need an instrumentation strategy. Nothing should run in production without instrumentation. That's not just the service light stuff that runs on EC2, it's also every click that runs. You know, when Dunkin Donuts, which has been a longtime customer of ours, and they run in the Amazon Cloud, you know when you pre-order that doughnut, we track the tap, how long it takes from the phone all the way through the cloud services, all that's fully instrumented, so if you're a CIO, you say I can't be tactical with instrumentation. If I'm going to move fast and compete at my software, nothing should run in production without education. >> John: That's native. >> That's right. >> Foundational. >> Foundational. It's a core requirement to run in production if you're going to move at any level of speed, so establish that strategy, and then we think, we offer the best instrumentation, certainly the best value, the most ubiquitous, the easiest to use, the most comprehensive, and then we make the most sense of it, but you could pick another, you know you could pick another strategy. Some people do the heavy lifting of manually instrumenting all their code. We just don't think that's a good use of your developer time, so we automatically do that for you, but have a strategy and then execute to it. >> Awesome. Lew, congratulations on a blowout quarter. I won't even get you to comment on it, just say that you guys had a great quarter, stocks at an all time high, all because you guys are doing a great product. Congratulations and great to have you on the Cube. >> We're delighted to be here. I've honestly, I've been a longtime fan. It means a lot that you could have me on, and we really enjoy partnering with Amazon, and what a great show. >> Yeah, super successful ecosystem partner, one of the best, New Relic, based out of San Francisco, here with the founder and CEO, also musician, writes code, gets down and dirty, runs a publicly held company. He's Superman. Lew, thanks for coming on the Cube. More live data and action here on the Cube after this short break, stay with us. (upbeat instrumental music)

Published Date : Nov 28 2017

SUMMARY :

Narrator: Live from Las Vegas, it's the Cube. Lew, great to have you on the Cube, welcome. I know, so great to be here. that's been on the Cube that writes software, but I'm the luckiest guy in the world I noticed, you guys get your hands dirty, In applications, so I really want to get your, and by competing you have to build the best stuff, inside the software stacks. and you integrate it with, you know, because like you said, if it crashes, and it's an amazing thing where you pre-order your pizza all the time. I love it that you're a developer. Oh geez, it really depends on the project. and getting the resources needed to solve a problem, I don't know why it didn't deploy well in production, and everything prior to the customer using so the old days was a crab. and it's the whole business, and it's a big business, Lew, I want to ask you an important question and there's data to prove it. Think about how you help your partner be successful. So you and I, pretend we're sitting here, Lew, what do you say? I say first of all, you have an instrumentation strategy. the easiest to use, the most comprehensive, Congratulations and great to have you on the Cube. It means a lot that you could have me on, Lew, thanks for coming on the Cube.

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Yvonne Wassenaar, New Relic | Catalyst Conference 2016


 

(energetic electronic music) >> From Phoenix, Arizona, the Cube, at Catalyst Conference. Here's your host, Jeff Frick. >> Hey, welcome back everybody, Jeff Frick here, with the Cube. We are on the ground in Phoenix Arizona at the Girls In Tech Catalyst Conference. We're really excited to return to Phoenix, ironically, it was two years ago, about this same time, we went to our first Grace Hopper conference that was here in Phoenix, and I don't know what it is with Phoenix, but it seems to be a great place for women in tech conferences. So, we're back, and we wanted to come down and talk to some of the people here that are giving keynotes, presentations, give you a flavor for what's going on, so if you got an opportunity to go next year, it'll be back in the Bay Area. You certainly want to sign up for that. So we're really excited, our first guest Yvonne Wassenaar, the CIO of New Relic, welcome. >> Thank you so much, it's great to be here, I love the Cube. >> Oh, thank you very much, that's right, you were at VMworld, or VMware, I always say world not ware, for years. And we've been doing, I think, the VMworld show for something like six years, or seven years. >> Yeah, super long time, and I watch you guys at reinvents, and a lot of other places. >> Oh great, well thank you for watching. So now you're at New Relic, so for the people that aren't familiar with New Relic, why don't you give them the quick 411. >> Yeah, so New Relic is is a software analytics company, and in the simplest terms, you don't bank in your retail branch, you bank on your phone. What matters is how your software's performing. Both from an application perspective, and a business perspective. So we help you understand what's going on. We're the best, first place to look to understand your digital business. >> It's really interesting, because we've got a premise that we're, at Wikibon, that it's all about, really, your digital engagement model. And you think about banking, how many times do you go into the bank, and actually interact with a teller? It's really moved to this electronic interface, in terms of your relationship. >> Exactly, it's not how warm the coffee is, or how long the teller line is, it's how performant is your application, and do you have the right feature functionality? >> Okay, so you're here, you had a keynote earlier in the week. >> This is the third day of the conference. So first of all, give us kind of what's the vibe been here for the last three days? >> It's phenomenal, and what I love about the Girl In Tech Conference, is that it brings together women of all types. I was speaking yesterday to a student at Stanford, who's here, who has her own non-profit, who's getting her degree to go out and change the world as an enterpreneur, to very, very seasoned executives who sit on boards. And everybody's here to understand what's the change going on, and how do I drive relevancy. And it's just phenomenal. >> Excellent, so your keynote was on how to stay relevant, and how to avoid extinction. >> Yeah. >> So why don't you give us some of the, I'm sure that was a well received one. >> Yeah, well, what's interesting is, change is the new constant. And it's actually riskier to not do something, than do something, today, but what do you do? And everybody says, "Oh, go out and be bold." and being bold's great, but fundamentally, it's hard. And it's easy to say, it's hard to do in practice. And so what my talk was really on, is, how do you address the unconscious fears? How do you say "Yeah, those bad things could happen, but you know what, if nothing bad happened, here's how I could change the world." And then just go after that vision. Free yourself from those kind of unconscious constraints, and really go after it wholeheartedly. >> And so is it more of a willingness to fail? Is it more of a willingness to, you know, look silly, if you feel? I mean, what are some of these unconscious fears, that if you consciously just address them, that will help you kind of overcome them, and be more proactive in your experimentation? >> Yeah, so for me it was very personal. It was some challenges that I had in my childhood, that really made me risk-averse, in ways that I didn't understand. And it's one of the things that they say, "Hey, women should lean in more." And I actually believe the reason that women don't lean in, is that they're trying to aim for a level of perfection, and don't realize it's a numbers game. Failure is not a reflection on you personally, failure is step towards your future successes. And so really it's a mindset change. >> Right, right, and I fundamentally feel too, as we try to innovate on the Cube, and do things different, if we're not failing sometimes, we're not really pushing the envelope enough, right? Everything shouldn't be successful. It's like the old economics newsboy model, right? If you come home with no newspapers, that means you could have sold a couple more probably, so it's not about perfection, it's about trying, and not being afraid to, "Mm, that didn't work out." >> You're spot on, and I led a workshop yesterday as well, on increasing your return on investment. And I literally told the women, I said, "If you are not failing, if everybody on your team's performing perfectly, you're a failed leader. You have to stumble, it's like skiing, if you don't fall, when you're skiing, you're not pushing yourself hard enough, you're not really doing it, so you need to let your team members fall, you have to fall yourself, and that's how you you're pushing the boundaries. >> So how is the reception then, of that message that you're trying to convey? Is it "You know, I know it, I just can't do it", is it, just, "Oh, there's just so many hurdles in the way"? How do you get over the, you know, here's this unconscious thing that you need to be thinking about, okay, now it's conscious, but to actually start to change behavior? What are some of the little behavioral changes and tips and tricks you give people? Because at the end of the day, a lot of times, it's do the behavior, not think about it too much. >> Exactly, I'd say it's a couple things, first off, you need role models, that can help prove to you and your subconcious, that, "My gosh, if those five amazingly successful people did this, and they're telling me, very specifically, the failures they had, and they're still that successful, maybe they're not lying."(laughs) The other thing is, I try to give really specific tips, so one of my favorites is, I'm an ex-consultant, so two by two, what's the business impact? What's your unique value? Throw all the things you're working on in there, you should have one to two that are high impact that you're uniquely skilled to do, hit those balls out of the park. You can get 20 guys to third base, doesn't matter. You got to get one person home. >> Got to get him home, that's great. I'm just curious, because you spent a long time at Accenture, before you jumped into the tech company world, so you probably saw a lot of different companies. What's your perspective at a macro view, of how this environment has changed over the years? I mean, do you see positive change? I know we have a long way to go, but what's your perspective from some of those early Accenture days? >> You know, it's never been a more exciting time. I mean, in some regards, I wish I was that Stanford student, just starting my career, because technology is changing how we do everything, in absolutely amazing ways. But, we need to bring the right level of social consciousness to how we apply it. And we need to figure out new engagement models. And I think those engagement models actually play to the strength of a lot of women we have in the room. You have to figure out how to fuse across different industries. So, the Apple Watch, it's designer, it's technology, like how do you bring those competencies together? You get better stuff done with partners than all internally. VCs are the new R&D innovation engines, so I think the change is really exciting. But you have to be open to new operating models, and new engagement styles, to take advantage of it. >> Right, okay I want to shift gears a little bit, because our audience might not know, but you're actually a very rare breed. >> (laughs) >> You're a woman on boards, and we hear over and over, I'm teasing you, because we hear over and over, there's just not near enough representation of women on corporate boards. You're on a couple of boards. So I'd like to get your perspective on, how did you get on the boards, how do we get more women on the boards? There's always a conversation, is it a pipeline problem? Are there just not enough, are they dropping out mid-career? What are some of the things you can see from your seat on a couple of boards? >> Yeah, so I'm on three boards, I'm on the board of Harvey Mudd, I'm on the board of Idiom, which is the series B start-up, and I'm on the board of the Athena Alliance. And the Athena Alliance is actually an organization, a non-profit focused on getting more women on boards, because I fundamentally believe it is not a pipeline problem, and I say that because there's many senior executive level women like myself, who just are waiting to check off the ten things on the list they think they need to be on a board. And it's studied time and time again, women set really high bars for themselves. So I don't think enough women are putting themselves forward. and I don't think that they're known well enough. We're not unicorns, we're really not. Like there are valleys where we all congregate, (laughs) and so what we need to do, is really help the men, who I think have amazing intention, and want to have greater diversity on their boards, understand how to make the connections, and find the right women with the right profiles to round out the organizations. >> So you think it's really more of a matching issue, the desire is there, but really just making the match when the timing is right, and it's a good fit. >> Yeah, exactly. >> All right, so I'm going to shift gears on you one more time, and talk about education, and specifically Harvey Mudd, because as I'd mentioned, two years ago, we were here interviewing Maria Klawe, still one of my all-time favorite interviews. She's got such phenomenal energy, she's the President at Harvey Mudd College, who are the Athenas, I don't know if you knew the Harvey Mudd gals' teams are the Athenas, boys are the Stags, but talk about education, and what Maria has done, I mean her thing in our interview, is she wants the intro CS, to be the best class you've ever taken. >> Yeah. >> Bar none, not the best computer science class, not the best science class, the best class ever, and I can tell you, my son's at Claremont, it's a really hard class to get into. Your perspective on education, and what somebody like Maria, with her kind of energy, point of view, enthusiasm, does to expanding computer science breadth in women specifically. >> Oh, it's phenomenal, I actually had the opportunity to sit in the intro CS class. And there's a couple really key things they've done. First off, is they've expanded and energized the CS team with new amazing talent, many women, but not just women, other diversity, to just round out perspective, so keeping it fresh. The second thing they've done, is they've realized that CS theory is interesting to some, but not to all, and a lot of women tend to be more purpose driven, so they've created classes like CS biology. Same core concepts, but now solving the problems in a field where they have questions. So they learn the same thing, but in a way that's more interesting. And the final thing is, they've restructured how they run the class. So they don't say, "Hey, here's a question," everybody goes, "Oh, I'll get that!" They say, "Here's a question I want you to think about. And talk to your partner, scribble some notes, and in a minute, let's discuss what you've come up with." and that allows people of all types to be more thoughtful and to get better, well-rounded answers coming out. So they've changed it on all dimensions, and it's just, it's an amazing place to go and be, and see the energy, and really see transformation in work in our education system, because that's where it all starts. >> That's really interesting, the way you say it, to phrase the question so people are forced to think a minute, because I have two daughters, they went to all-girls middle schools, and that's one of the classic plugs for going to all-girls, because the boys, they don't wait, right? >> (laughs) "Okay if I have the right answer, I'm going to get picked! >> "Pick me, I love the teacher, pick me, pick me!" >> You picked me, I win!" >> Right, "and then I'll figure it out," versus people that want to think about it a little bit, and contemplate, and noodle, and maybe try to get the right answer before they raise their hand, so great strategy. So before we let you go, unfortunately we're out of time, how do people get involved with the Athena Foundation, what are you up to, in terms of priorities for the next six months? >> Yeah, so it's the Athenaalliance.org, we're on the web, we're just starting, DLA Piper is one of our sponsors, getting our 501c3 status, there's information there in terms of membership, who we're working to connect with. If any of you listening have board seats and you want women, come to us. If you're a qualified woman, and you're looking to get on a board, reach out, we'd love to hear you, we know you're there, and we know that men want to put you on boards, so let's make it happen. >> What a great service really, doing that matching game, because it's always about the matching game. Well, Yvonne, thanks for taking a few minutes out of your busy day, and we look forward to seeing you again sometime in the Bay Area. >> Great, thank you so much, great stuff. >> Jeff Frick here at the Girls In Tech Catalyst Conference in Phoenix Arizona, we'll be back after this short break. Thanks for watching. (energetic electronic music)

Published Date : Apr 21 2016

SUMMARY :

the Cube, at Catalyst Conference. and talk to some of the people here Thank you so much, it's great Oh, thank you very much, that's right, and I watch you guys Relic, so for the people and in the simplest terms, you don't bank And you think about banking, earlier in the week. day of the conference. and change the world as an enterpreneur, how to stay relevant, and So why don't you give us And it's easy to say, it's And it's one of the things that they say, that means you could have and that's how you you're So how is the reception you and your subconcious, so you probably saw a lot VCs are the new R&D innovation engines, but you're actually a very rare breed. What are some of the things you can see and find the right women really just making the match to shift gears on you not the best computer science class, and energized the CS team So before we let you go, to put you on boards, to seeing you again Jeff Frick here at the Girls

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Larry Lancaster & Rod Bagg, Zebrium | Zebrium Root Cause as a Service


 

(upbeat music) >> Full stack observability is all the rage today. As businesses lean into digital, customer experience becomes ever more important. Why? Well, it's obvious, fickle consumers can switch brands in the blink of an eye or the click of a mouse. Technology companies have sprung into action and the observability space is getting pretty crowded in an effort to simplify the process of figuring out the root cause of application performance problems without an army of PhDs and lab coats, also known as endlessly digging through logs, for example. We see decades old software companies that have traditionally done monitoring or log analytics and or application performance management stepping up their game. These established players, you know, they typically have deep feature sets and sometimes purpose-built tools that attack one particular segment of the marketplace. And now they're pivoting through M&A and some organic development trying to fill gaps in their portfolio. And then, you got all these new entrants coming to the market, claiming end to end visibility across the so-called modern cloud and now edge native stacks. Meanwhile, cloud players are gaining traction and participating through a combination of native tooling combined with strong ecosystems to address this problem. But, you know, recent survey research from ETR confirms our thesis that no one company has it all. Here's the thing. Customers just want to figure out the root cause as quickly and as efficiently as possible. It's one thing to observe the stack end to end, but the question is who is automating the observers? And that's why we're here today. Hello, my name is Dave Vellante and welcome to this special Cube presentation where we dig into root cause analysis, and specifically, how one company, Zebrium, is using unsupervised machine learning to detect anomalies and pinpoint root causes and delivering it as an automated service. And in this session, we have two deep dives. First, we're going to dig into this exciting new field of RCaaS, Root Cause As A Service with two of the founders and technical experts behind Zebrium. And then we bring in two technical experts from Cisco, an early Zebrium customer who ran a POC with Zebrium's service, automating and identifying root cause problems within four very well established and well known Cisco product lines, including WebEx Client and UCS. I was pretty amazed at the results and I think you'll be impressed as well. So thanks for being here. Let's get started. With me right now is Larry Lancaster, who's a founder and CTO of Zebrium. And he's joined by Rod Bagg, who's the founder and vice president of engineering at the company. Gents, welcome. Thanks for coming on. >> Thanks. >> Okay. >> It's good to be here. >> It's good to be here >> All right Rod, talk to me. Talk to me about software downtime, what root cause means, all the buzzwords in your domain, MTTR and SLO. What do we need to know? >> Yeah, I mean, it's like you said. I mean, it's extremely important to our customers and to most businesses out there to drive uptime and avoid as much downtime as possible. So, you know, when you think about it, all of these businesses, most companies nowadays, either their product is software and it's running, you know, running on the web and that's how you get a point click. Or the business depends on, you know, internal systems to drive their business and to run it. When that is down, that is hugely impacting to them. So if you take a look, you know, way back, you know, 20, 30 years ago, software was simple. You know, there wasn't much to it. It was pretty monolithic and maybe it took a couple of people to maintain it and keep it running. There wasn't really anything complicated about it. It was a single tenant piece of software. Today's software is so complicated, often running, you know, maybe hundreds of services to keep that or to actually implement what that software is doing. So as you point out, you know, enter the sort of observability space and the tools that are now in use to help monitor that software and make sure when something goes wrong, they know about it But there's kind of an interesting stat around the observability space. So when you look at observability in the context or through the lens of the cost of downtime, it's really interesting. So observability tools are about a $20 billion market, okay? But the cost of downtime, even with that in place, is still hundreds of billions of dollars. So you're not taking much of a bite out of what the real problem is. You have to solve root cause and get to that fast. So it's all great to know that something went wrong but you got to know why. And it's our contention here that, you know, really, when you take a look at the observability space, you have metrics, that's a great tool. I mean, there's lots of great tools out there, you know, around metrics monitoring that's going to tell you when something went wrong. It's very rarely it's going to tell you why. Similarly for tracing, it's going to point you to where the issue is. It's going to take you through that stack and probably pinpoint where you're being, you know where it's happening or where something is running slow, potentially. So that's great. But again, the root cause of why it's happening is going to be buried in log files. And I can expand on that a little bit more but you know, when you're a software developer and you're writing your software, those log files are a wealth of information. It's just a set of breadcrumbs that are littered with facts about how the software is behaving and why it's doing what it's doing, or why it went wrong. And it's that that really gets you to the root cause very fast. And that's our contention, is that these software systems are so complex nowadays and that the root cause is lying in those logs. So how do you get there fast? You know, we would contend that you better automate that or you are just doomed for failure. And that's where we come in. >> Great. >> Getting to that root cause. >> Thank you, Rod. You know, it's interesting you talk about the $20 billion market. There's an analogy with security, right? We spend 80, $100 billion a year on securing our infrastructure, and yet we lose probably closer to a trillion dollars a year in breaches. And there's a similar analogy here. 20 billion could be 5X in downtime impacts or more. Okay, let's go to Larry. Tell us a little bit more about Zebrium. I'm interested always to ask a founder why you started the company. Rod touched on that a little bit. You guys have invented this concept of RCaaS. What does it mean? What problems does it solve, and how does it solve the problem? Let's get into it. >> Yeah. Hey, thanks, Dave. So I think when you said, you know, who's automating the observer, that that's a great way to think about it because what observability really means is it's a property of a system that means you can see into it. You can observe the internal state and that makes it easier to troubleshoot, right? But the problem is if it's too complicated, you just push the bottleneck up to your eyeball. There's only so much a person can filter through manually, right? And I love the way you put that. So that's a great way to think about it is automating the observer. Now, of course, it means that, you know, you reduce your MTTR, you meet your service level objectives, all that stuff, you improve customer experience. That's all true, but it's important to step back and realize like we have cracked a real nut here. People have been trying to figure out how to automate this part of sort of the troubleshooting experience, this human part of finding the root cause indicators for a long time. And until Zebrium came along, I would argue, no one's really done it right. So, you know, I think it's also important you know, as we step back, we can probably look forward five to 10 years and say, everyone's going to look back and say how did we do all this manually? You're going to see this sort of last mile of observability and troubleshooting is going to be automated everywhere because otherwise, you know, people are just... They're not going to be able to scale their business. So, you know, I think one more thing that's important to point out is, you know, I think Zebrium, you know, it's one thing to have the technology but we've learned we need to deliver it right where people are today. You can't just expect people to dive into a new tool. So, you know, we're looking at, you know, if you look at Zebrium, you'll put us on your dashboard and we don't care what kind of a dashboard it is. It could be, you know Datadog, New Relic, Elastic, Dynatrace, Grafana AppDynamics, ScienceLogic, we don't care. You know, they're all our friends. So we're more interested in getting to that root cause than trying to fight, you know, these incumbents and all that stuff. Yep. >> Yeah. So, interesting. Again, another analogy I think about. You know, you talked about automation. If we're to look back and say this is what... We're never going to do this again, it's like provisioning loans. Nobody provisions loans anymore, it's all automated. >> Larry: (chuckling) That's right. >> So Larry, I'll stay with you, then the skeptic in me says, this sounds amazing, but if I, you know... It might be too good to be true. Tell us how it works. >> Larry: (chuckling) Yeah. So that's interesting. So Cisco came along and they were equally skeptical. So what they did was they took a couple of months and they did a very detailed study. And they got together 192 incidents across four product lines, where they knew that the root cause was in the logs. And they knew what that root cause was because they had had their best engineers, you know work on those cases and take detailed notes of the incidents that had taken place. And so they ran that data through the Zebrium software. And what they found was that in more than 95% of those incidents, Zebrium reflected the correct root cause indicators at the correct time. Like that blew us away. When we saw that kind of evidence, Dave, I have to tell you, everyone was just jumping up and down. It was like, you know, it was like the Apollo command center, you know when they finally, you know, touchdown on the moon kind of thing. So, you know, it's really an exciting point in time to be at the company, like just seeing everything finally being proven out according to this vision. I'm going to tell you one more story which is actually one of my favorites, because we got a chance to work with Seagate Lyve Cloud. So they're, you know, a hyper modern, you know, SaaS business, they're an S3 competitor. Zoom has their files stored on Lyve Cloud, you know, to let you know who they are. So essentially, what happened was they were in alpha, their early access, and they had an outage, and it was pretty bad. I mean, it went on for longer than a day, actually, before they were completely restored. And it was, you know, fortunately for them, it was early access. So no one was expecting, you know, uptime, you know, service level objectives and so on. But they were scared, because they realized, if something like this happens in production, you know, they're screwed. So what they did was they saw Zebrium. They went and did some research, they saw Zebrium. They went in a staging environment, recreated the exact (indistinct) that they had had. And what they saw was immediately, Zebrium pops up a root cause report that tells them exactly the root cause that they took over a day to find. These are the kind of stories that let us know we're onto something transformational. >> Dave: Yeah. That's great. I mean, you guys are jumping up and down, I'm sure. We're going to hear from Cisco later. I bet you, they were jumping up and down too because they didn't have to do all that heavy lifting anymore. So Rod, Larry's just sort of implying that, or actually, you guys both talked about that your tool is agnostic. So how does one actually use the service? How do I deploy it? >> Yeah. So let me step back. So when we talk about logs right? Like, you know, all these bread crumbs being in logs and everything else? So, you know, they are a great wealth of you know, information, but people hate dealing with them. I mean, they hate having to go in and figure out what log to look at. In fact, you know, we had one of our... Or we've heard from several of our customers now prior to using Zebrium, when they, you know, have some issue, and they know there's something wrong, something on their dashboard has told them that something's wrong, maybe a metric has, you know, taken a blip or something's happened that they know there's a problem. We've heard from them that it can take like a number of hours just to get to the right set of logs, like figuring out over these hundreds of services where the logs are, to get to them, maybe searching in a log manager. Just to get into the right context, even, can take hours. So, you know, that's obviously the problem we solve but, you know, we don't want them just looking at logs. I mean, you know, we don't want to put them back in the thing they don't like doing because people don't do that. They don't like doing it. So we put it up on the dashboard. So if something is going wrong with your metrics and that's the indicator, or maybe it's something with tracing that you're sort of digging through that you know something's wrong, we will be right on that same dashboard. So we're deployed as a SaaS service. You send us your logs, you click on one of our integrations and we integrate with all these tools that Larry's talked about. And when we detect anything that is a root cause report, it will show up on your dashboard in the same timeline as those blips in your metrics. So when you see something going wrong and you know there's an issue, take a look at the portion of your dashboard that is us, and we're going to tell you why. We're going to get you to the why that went wrong. No other work could be... You can, you know, also click down and click through to us so that you land up in our portal, if you want to do some more digging around, if you need to or whatever, maybe to get some context what have you, but it's fair that if you ever need to do that, the answer should be right there on your dashboard. And that that's how we expect people to use it. We don't want them digging in logs and going through things, we want it to be right in their workflow. >> Great. Thank you, Larry. So Rod, we talked about Cisco. We're going to hear more from them in a moment in Seagate. I would think this is like a perfect solution for a SaaS provider, anybody doing AI ops. Do you have some examples of those types of firms leaning into this? >> Rod: Yeah, a couple of great ones. Well, I mean, we've got many of them, but a couple that I'll touch on. We have an actual AI ops company that was looking for, you know, sort of some complimentary technology and so on. And so they decided to just put us through our paces by having one of their own SREs sign up for our service in our SaaS environment, and send the logs from their system to us, you know, and just see how we did. So it turned out we ended up talking back to this SRE like a week after he had installed the product, you know signed up and then, you know, started sending us logs. And, you know, he was hewing and hawing, saying that he was busy, like every SRE is, and that he didn't have a chance to really do much with us yet. And, you know, we were just, you know, having this conversation on the phone, and he comes to tell us that, yeah I've been busy because we had this, you know, terrible outage, like, you know, five days ago. And we said like, "Okay did you actually look on the Zebrium dashboard?" (chuckles) And he goes, "You know what? I didn't even think to do it yet. I mean, I'd just been so busy and frazzled." So we have an integration with that company, he hadn't put that integration in, so it wasn't in his dashboard yet, but it was certainly on ours. So he went there, and he looks and he looks on the day, you know, on the time range of when he had had this incident. And right at the very top of the page on our portal was that incident with that root cause. And he was flabbergasted. It literally would've saved him hours and hours and hours. They had this issue going on for over 24 hours. And we had the answer right there in five minutes, and it was crazy. And we get that kind of stories. It's just like the Seagate one. If you use us and you have a problem, we're going to detect it. And you're going to hear from Cisco how successful we are at detecting things. I mean, it'll be there when you have a problem. In SaaS companies, you know, one of our customers is Alchera. They do cost optimizations for cloud properties, you know, for AWS optimization, Google, Google cloud, and so on. But they use our software, and they have a lot of interaction, obviously with these cloud vendors and the APIs of those cloud vendors. So, you know, in order to figure out your costing at AWS, they're using all those APIs. So it turned out, you know, they had some issue where their services were breaking. And we had that root cause report right on the screen, again within five minutes, that was pointing to an API problem with Google. And they had changed one of their APIs and Alchera was not aware of it. So their stuff was breaking because of a change downstream that we had caught. And I'll just tell you one last one because it's somewhat related to one of these cloud vendors. You know, it was a big cloud vendor who had an outage a couple of months ago. And it's interesting because, you know, a lot of our customers will set up shared Slack channels with us, where we're monitoring or seeing their incidents as well as they are. So we get a little Slack representation of the incident that we detected for them or the root cause that we detected for them, and that's in a shared community channel. So we could see this happening when that AWS outage happened. We could see our customers getting impacted by that AWS outage, and the root cause of what was going on there in AWS that was impacting our customers that was showing up in our incidents. Now we didn't obviously, you know, have the very root cause of what was going on in AWS, per se but we were getting to the root cause of why our customer's applications were failing. And that was because of issues going on at AWS. >> Very interesting. I mean, I think one of your biggest challenges is going to be getting people's attention because these SREs are so busy, their hair's on fire. >> Rod: That's it. Right. (chuckling). You know, when you say, hey, (indistinct). >> I tell you, if you get their attention, they love it. I mean, this AI ops company, I didn't even tell you the punchline there, but, you know, they had this incident that occurred that we found. And quite literally, the next week, they ended up signing up as a paid customer. So... >> Dave: that's great. And Larry, to give you the last word. I mean, you know, Rod was talking about, you know, changes in APIs and you know, there's still a lot of scripts out there. You guys, if I understand it correctly, run both as a service in the cloud and you can run on-prem, which is important because there's a lot of sensitive information in logs that people are trying not to leave. >> Larry: That's right. Absolutely. >> Dave: But close it out here. >> Yeah. I mean, that's right, you can run it on-prem. Just like we run it in our cloud, you can run it in your cloud or on your own infrastructure. Now that's all true. You know, I think the one hurdle now that we have left as a company is getting the word out and getting people to believe that this is actually possible and try it for themselves. You don't believe it, do a POC, try it yourself. And you know, people have become so jaded by the lack of, you know, real, sort of, innovation in the software industry for the last 10 years that it's hard to get people to... But guys, you got to give it a shot, I'm telling you. I'm telling you right now, it works. And you'll hear more about that from one of our customers in a minute. >> All right guys, thanks so much. Great story. Really appreciate you sharing. >> Thank you. >> Yeah. Thanks Dave. Appreciate the time. >> Okay. In a moment, we're going to hear from Cisco who is the customer in this case example and a company that has... Look, they have quite an impressive suite of observability tooling, and they've done a pretty compelling proof of concept with Zebrium using real data on some Cisco products that you've heard of, like WebEx. So stay tuned and learn about how you can really take advantage of this new technology called Root Cause As A Service. You're watching theCube, the leader in enterprise and emerging tech coverage. (upbeat music)

Published Date : Jun 16 2022

SUMMARY :

you know, they typically All right Rod, talk to me. Or the business depends on, you know, and how does it solve the problem? And I love the way you put that. You know, you talked about automation. this sounds amazing, but if I, you know... So no one was expecting, you know, uptime, I mean, you guys are jumping up and down, We're going to get you to Do you have some examples and he looks on the day, you know, is going to be getting people's attention you say, hey, (indistinct). but, you know, they had And Larry, to give you the last word. Larry: That's right. by the lack of, you know, appreciate you sharing. you can really take advantage

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Larry Lancaster & Rod Bagg


 

(bright intro music) >> Full stack observability is all the rage today. As businesses lean in to digital, customer experience becomes ever more important, why? Well, it's obvious. Fickle consumers can switch brands in the blink of an eye or the click of a mouse. Technology companies have sprung into action, and the observability space is getting pretty crowded in an effort to simplify the process of figuring out the root cause of application performance problems without an army of PhDs and lab coats, also known as endlessly digging through logs, for example. We see decades-old software companies that have traditionally done monitoring or log analytics and/or application performance management stepping up their game. These established players, you know, they typically have deep feature sets and sometimes purpose built tools that attack one particular segment of the marketplace, and now, they're pivoting through M&A and some organic development trying to fill gaps in their portfolio, and then you got all these new entrants coming to the market claiming end to end visibility across the so-called modern cloud and now edge-native stacks. Meanwhile, cloud players are gaining traction and participating through a combination of native tooling combined with strong ecosystems to address this problem, but, you know, recent survey research from ETR confirms our thesis that no one company has at all. Here's the thing. Customers just want to figure out the root cause as quickly and efficiently as possible. It's one thing to observe the stack end to end, but the question is who is automating the observers? And that's why we're here today. Hello, my name is Dave Vellante, and welcome to this special "CUBE" presentation where we dig into root cause analysis and, specifically, how one company, Zebrium, is using unsupervised machine learning to detect anomalies and pinpoint root causes and delivering it as an automated service. In this session, we have two deep dives. First, we're going to dig into this exciting new field of RCA, root cause as a service, with two of the founders and technical experts behind Zebrium, and then we bring in two technical experts from Cisco, an early Zebrium customer who ran a POC with Zebrium's service, automating and identifying root cause problems within four very well established and well-known Cisco product lines including Webex client and UCS. I was pretty amazed at the results, and I think you'll be impressed as well. So thanks for being here. Let's get started with me right now is Larry Lancaster who's a founder and CTO of Zebrium, and he's joined by Rod Bagg who's a founder and Vice-President of Engineering at the company. Gents, welcome, thanks for coming on. >> Thanks. >> (indistinct). >> To be here. >> Great to be here. >> All right, Rod, talk to me. Talk to me about software downtime, what root cause means, all the buzzwords in your domain, MTTR and SLO, what do we need to know? >> Yeah, I mean, it's like you said. I mean, it's extremely important to our customers and to most businesses out there to drive up time and avoid as much downtime as possible. So, you know, when you think about it, all of these businesses, most companies nowadays, either their product is software and it's running, you know, running on the web, and that that's how you get a point click or their business depends on it and, you know, internal systems to drive their business and to run it. Now, when that is down, that is hugely impacting to them. So if you take a look, you know, way back, you know, 20, 30 years ago, software was simple. You know, there wasn't much to it. It was pretty monolithic, and maybe it took a couple of people to maintain it and keep it running. It wasn't really anything complicated about it. It was a single tenant piece of software. Today's software is so complicated, often running, you know, maybe hundreds of services to keep that or to actually implement what that software is doing. So as you point out, you know, enter the sort of observability space and the tools that are now in use to help monitor that software and make sure when something goes wrong, they know about it, but there's kind of an interesting stat around the observability space. So when you look at observability in the context or through the lens of the cost of downtime, it's really interesting. So observability tools are about a $20 billion market, okay? But the cost of downtime, even with that in place, is still hundreds of billions of dollars. So you're not taking much of a bite out of what the real problem is. You have to solve root cause and get to that fast. So it's all great to know that something went wrong, but you got to know why, and it it's our contention here that, you know, really, when you take a look at the observability space, you have metrics. That's a great tool. I mean, there's lots of great tools out there, you know, around metrics monitoring that's going to tell you when something went wrong. It's very rarely it's going to tell you why. Similarly for tracing, it's going to point you to where the issue is. It's going to take you through that stack and probably pinpoint where you're being, you know, where it's happening or where something is running slow potentially. So that's great, but again, the root cause of why it's happening is going to be buried in log files, and I can expand on that a little bit more, but, you know, when you're a software developer, and you're writing your software, those log files are a wealth of information. It's just a set of breadcrumbs that are littered with facts about how the software is behaving and why it's doing what it's doing or why it went wrong, and it's that that really gets you to the root cause very fast, and that's, our contention is that these software systems are so complex nowadays, and that the root cause is lying in those logs. So how do you get there fast? You know, we would contend that you better automate that or you're just doomed for failure, and that's where we come in. >> Great. >> Getting to that request. >> Thank you, Rod. You know, it's interesting. You talk about the $20 billion market. There's an analogy with security, right? We spend 80, $100 billion a year on securing our infrastructure, and yet we lose, probably, closer to a trillion dollars a year in breaches, and there's a similar analogy here. 20 billion could be 5x in downtime impacts or more. Okay, let's go to Larry. Tell us a little bit more about Zebrium. I'm interested always to ask a founder why you started the company. Rod touched on that a little bit. You guys have invented this concept of RCAs. What does it mean? What problems does it solve? And how does it solve the problem? Let's get into it. >> Yeah, hey, thanks, Dave. So I think when you said, you know, who's automating the observer? That's a great way to think about it because what observability really means is it's a property of a system that means you can see into it. You can observe the internal state, and that makes it easier to troubleshoot, right? But the problem is if it's too complicated, you just push the bottleneck up to your eyeball. There's only so much a person can filter through manually, right? And I love the way you put that. So that's a great way to think about it is automating the observer. Now, of course, it means that, you know, you reduce your MTTR, you meet your service level objectives, all that stuff, you improve customer experience, that's all true, but it's important to step back and realize like we have cracked a real nut here. People have been trying to figure out how to automate this part of sort of the troubleshooting experience, this human part of finding the root cause indicators for a long time, and until Zebrium came along, I would argue no one's really done it right. So, you know, I think it's also important, you know, as we step back, we can probably look forward five to 10 years and say, "Everyone's going to look back and say, 'How did we do all this manually?'" You're going to see this sort of last mile of observability and troubleshooting is going to be automated everywhere because otherwise, you know, people are just, they're not going to be able to scale their business. So, you know, I think one more thing that's important to point out is, you know, I think Zebrium, you know, it's one thing to have the technology, but we've learned we need to deliver it right where people are today. You can't just expect people to dive into a new tool. So, you know, we're looking at, you know, if you look at Zebrium, you'll put us on your dashboard, and we don't care what kind of a dashboard it is. It could be, you know, Datadog, New Relic, Elastic, Dynatrace, Grafana, AppDynamics, ScienceLogic, we don't care. You know, they're all our friends. So we're more interested in getting to that root cause than trying to fight, you know, these incumbents and all that stuff, yeah. >> Yeah, so interesting. Again, another analogy I think about, you know, you talked about automation, where to look back, and say, "This is what- We're never going to do this again." It's like provisioning LANs. Nobody provisioned LANs anymore. It's all automated. >> That's correct. >> So, Larry, stay with you. The skeptic in me says, "This sounds amazing," but if, you know, it probably too good to be true. Tell us how it works. >> Yeah, so that's interesting. So Cisco came along and they were equally skeptical. So what they did was they took a couple of months, and they did a very detailed study, and they got together 192 incidents across four product lines where they knew that the root cause was in the logs, and they knew what that root cause was because they'd had their best engineers, you know, work on those cases and take detailed notes of the incidents that had taken place, and so they ran that data through the Zebrium software, and what they found was that in more than 95% of those incidents, Zebrium reflected the correct root cause indicators at the correct time. Like that blew us away. When we saw that kind of evidence, Dave, I have to tell you, everyone was just jumping up and down. It was like, you know, it was like the Apollo Command Center, you know, when they finally, (Dave laughs) you know, touchdown on the moon kind of thing. So, you know, it's really exciting at a point in time to be at the company, like just seeing everything finally being proven out according to this vision. I'm going to tell you one more story, which is actually one of my favorites, because we got a chance to work with Seagate Lyve Cloud. So they're, you know, a hyper modern, you know, SaaS business. They're an S3 competitor. Zoom has their files stored on Lyve Cloud to give, you know, to let you know who they are. So, essentially, what happened was they were in alpha, in their early access, and they had an outage, and it was pretty bad. I mean, it went on for longer than a day, actually, before they were completely restored, and it was, you know, fortunately, for them, it was early access. So no one was expecting, you know, uptime, you know, service level objectives and so on, but they were scared because they realized if something like this happens in production, you know, they're screwed. So what they did was they saw Zebrium, they did some research, they saw Zebrium. They went in a staging environment, recreated the exact (indistinct) that they'd had, and what they saw was, immediately, Zebrium pops up a root cause report that tells them exactly the root cause that they took over a day to find. These are the kind of stories that let us know we're onto something transformational. >> Yeah, that's great. I mean, you guys are jumping up and down. I'm sure, we're going to hear from Cisco later. I bet you, they were jumping up and down, too, 'cause they didn't have to do all that heavy lifting anymore. So Rod, Larry's just sort of implying that or, actually, you guys both talked about that your tool's agnostic. So how does one actually use the service? How do I deploy it? >> Yeah, so let me step back. So when we talk about logs, right? Like, you know, all these red crumbs being in logs and everything else. So, you know, they are a great wealth of, you know, information, but people hate dealing with them. I mean, they hate having to go in and figure out what log to look at. In fact, you know, we had one of our, or we've heard from several of our customers now prior to using Zebrium, but when they're, you know, have some issue, and they know there's something wrong, something on their dashboard has told them that something's wrong, maybe a metrics is, you know, taken a blip or something's happened that they know there's a problem, we've heard from them that it can take like a number of hours just to get to the right set of logs, like figuring out over these hundreds of services where the logs are to get to them, maybe searching in a log manager, just to get into the right context even can take hours. So, you know, that's obviously the problem we solve, but, you know, we don't want them just looking at logs. I mean, you know, we don't want to put 'em back in the thing they don't like doing 'cause people don't do what they don't like doing. So we put it up on the dashboard. So if something is going wrong with your metrics, and that's the indicator or maybe it's something with tracing that you're sort of digging through now that you know something's wrong, we will be right on that same dashboard. So we're deployed as a SaaS service. You send us your logs. You click on one of our integrations, and we integrate with all these tools that Larry's talked about, and when we detect anything that is a root cause report, it will show up on your dashboard in the same timeline as those blips in your metrics. So when you see something going wrong, and you know there's an issue, take a look at the portion of your dashboard that is us, and we're going to tell you why. We're going to get you to the why that went wrong. Not no other work could be- You can, you know, also click down and click through to us so that you land up in our portal if you want to do some more digging around if you need to or whatever, maybe to get some context, what have you, but it's fair that you ever need to do that. The answer should be right there on your dashboard, and that's how we expect people to use it. We don't want them digging in logs and going through things. We want it to be right in their workflow. >> Great, thank you, Larry. So Rod, we talked about Cisco. We're going to hear more from them in a moment and Seagate. I would think this is like a perfect solution for a SaaS provider, anybody doing AIOps, do you have some examples of those types of firms leaning into this? >> Yeah, a couple of great, well, I mean, we got many of them, but couple that I'll touch on. We have an actual AIOps company that was looking for, you know, sort of some complimentary technology and so on, and so they decided to just put us through our paces by having one of their own SREs sign up for our service in our SaaS environment and send the logs from their system to us, you know, and just see how we did. So it turned out we ended up talking back to this SRE like a week after he had installed the product, you know, signed up, and then, you know, started sending us logs, and, you know, he was hemming and hawing saying that he was busy like, you know, like every SRE is, and that he didn't have a chance to really do much with us yet, and, you know, we just, you know, having this conversation on the phone, and he comes to tell us that, "Yeah, I've been busy because we had this, you know, terrible outage like, you know, five days ago," and we said like, "Okay, did you actually look on the Zebrium dashboard?" (laughs) And he goes, "You know what? I didn't even think to do it yet. I mean, I'd just been so busy and frazzled." So we have an integration with that company. He hadn't put that integration in so it wasn't in his dashboard yet, but it was certainly on ours. So he went there and he looks on the day like, you know, on the time range of when he had this incident, and right at the very top of the page on our portal was the incident with the root cause, and he was flabbergasted. It literally would've saved him hours and hours and hours. They had this issue going on for over 24 hours, and we had the answer right there in five minutes, and it was crazy, and we get that kind of story. It's just like the Seagate one. If you use us and you have a problem, we're going to detect it, and you're going to hear from Cisco how successful we are at detecting things. I mean, it'll be there when you have a problem. In SaaS companies, you know, one of our customers is Archera. They do cost optimizations for cloud properties, you know, for AWS optimization, Google cloud, and so on, but they use our software, and they have a lot of interaction, obviously, with these cloud vendors and the APIs of those cloud vendors. So, you know, in order to figure out you're costing at AWS, they're using all those APIs. So it turned out, you know, they had some issue where their services were breaking and we had that root cause report right on the screen, again, within five minutes that was pointing to an API problem with Google, and they had changed one of their APIs, and Archera was not aware of it. So their stuff was breaking because of a change downstream that we had caught, and I'll just tell you one last one because it's somewhat related to one of these cloud vendors of, you know, big cloud vendor who had an outage couple of months ago, and it's interesting because, you know, lot of our customers will set up shared Slack channels with us where we're monitoring or seeing their incidents as well as they are. So we get a little Slack representation of the incident that we detected for them or the root cause that we've detected for them, and that's in a shared community channel. So we could see this happening when that AWS outage happened. We could see our customers getting impacted by that AWS outage and the root cause of what was going on there in AWS that was impacting our customers, that was showing up in our incidents. Now, we didn't obviously, you know, have the very root cause of what was going on in AWS per se, but we were getting to the root cause of why our customer's applications were failing, and that was because of issues going on at AWS. >> Very interesting. I mean, I think one of your biggest challenge is going to be getting people's attention because these SREs is so busy, their hair's on fire. (all laughs) You know, he's like, "Hey, chap, I'm going to show you, look at this." >> I tell you. You get their attention, they love it. I mean, this AIOps company, I didn't even tell you the punchline there, but, you know, they had this incident that occurred that we found and, quite literally, the next week, they ended up signing up as a paid customer, so. >> That's great, and Larry, give you the last word. I mean, you know, Rod was talking about, you know, changes in APIs, and, you know, there's still a lot of scripts out there. You guys, if I understand it correctly, run both as a service in the cloud and you can run on-prem, which is important because there's a lot of sensitive information in logs and people don't want to leave. >> That's right, absolutely. >> But, yeah, close it out here. >> Yeah, I mean, you can, that's right, you can run it on-prem, just like we run it in our cloud. You can run it in your cloud or on your own infrastructure. Now, that's all true. You know, I think the one hurdle now that we have left as a company is getting the word out and getting people to believe that this is actually possible and try it for themselves. You don't believe it? Do a POC, try it yourself. And, you know, people have become so jaded by the lack of, you know, real sort of innovation in the software industry for the last 10 years that it's hard to get people to... But guys, you got to give it a shot. I'm telling you. I'm telling you right now, it works, and you'll hear more about that from one of our customers in a minute. >> Alright guys, thanks so much. Great story, really appreciate you sharing. >> Thank you. >> Yeah, thanks, Dave. Appreciate the time. >> Okay, in a moment, we're going to hear from Cisco who is the customer in this case example, and a company that is... Look, they have quite an impressive suite of observability tooling, and they've done a pretty compelling proof of concept with Zebrium using real data on some Cisco products that you've heard of like Webex. So stay tuned and learn about how you can really take advantage of this new technology called root cause as a service. You're watching "theCUBE", the leader in enterprise and emerging tech coverage. (bright outro music)

Published Date : May 25 2022

SUMMARY :

and then you got all these new entrants all the buzzwords in your and that that's how you get a point click why you started the company. Now, of course, it means that, you know, about, you know, you but if, you know, it and it was, you know, I mean, you guys are jumping up and down. I mean, you know, we do you have some examples saying that he was busy like, you know, is going to be getting people's attention but, you know, they had I mean, you know, Rod was talking by the lack of, you know, appreciate you sharing. Appreciate the time. So stay tuned and learn about how you can

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AWS Heroes Panel | Open Cloud Innovations


 

(upbeat music) >> Hello, and welcome back to AWS Startup Showcase, I'm John Furrier, your host. This is the Hero panel, the AWS Heroes. These are folks that have a lot of experience in Open Source, having fun building great projects and commercializing the value and best practices of Open Source innovation. We've got some great guests here. Liz Rice, Chief Open Source Officer, Isovalent. CUBE alumni, great to see you. Brian LeRoux, who is the Co-founder and CTO of begin.com. Erica Windisch who's an Architect for Developer Experience. AWS Hero, also CUBE alumni. Casey Lee, CTO Gaggle. Doing some great stuff in ed tech. Great collection of experts and experienced folks doing some fun stuff, welcome to this conversation this CUBE panel. >> Hi. >> Thanks for having us. >> Hello. >> Let's go down the line. >> I don't normally do this, but since we're remote and we have such great guests, go down the line and talk about why Open Source is important to you guys. What projects are you currently working on? And what's the coolest thing going on there? Liz we'll start with you. >> Okay, so I am very involved in the world of Cloud Native. I'm the chair of the technical oversight committee for the Cloud Native Computing Foundation. So that means I get to see a lot of what's going on across a very broad range of Cloud Native projects. More specifically, Isovalent. I focus on Cilium, which is it's based on a technology called EBPF. That is to me, probably the most exciting technology right now. And then finally, I'm also involved in an organization called OpenUK, which is really pushing for more use of open technologies here in the United Kingdom. So spread around lots of different projects. And I'm in a really fortunate position, I think, to see what's happening with lots of projects and also the commercialization of lots of projects. >> Awesome, Brian what project are you working on? >> Working project these days called Architect. It's a Open Source project built on top of AWSM. It adds a lot of sugar and terseness to the SM experience and just makes it a lot easier to work with and get started. AWS can be a little bit intimidating to people at times. And the Open Source community is stepping up to make some of that bond ramp a little bit easier. And I'm also an Apache member. And so I keep a hairy eyeball on what's going on in that reality all the time. And I've been doing this open-source thing for quite a while, and yeah, I love it. It's a great thing. It's real science. We get to verify each other's work and we get to expand and build on human knowledge. So that's a huge honor to just even be able to do that and I feel stoked to be here so thanks for having me. >> Awesome, yeah, and totally great. Erica, what's your current situation going on here? What's happening? >> Sure, so I am currently working on developer experience of a number of Open Source STKS and CLI components from my current employer. And previously, recently I left New Relic where I was working on integrating with OpenTelemetry, as well as a number of other things. Before that I was a maintainer of Docker and of OpenStack. So I've been in this game for a while as well. And I tend to just put my fingers in a lot of little pies anywhere from DVD players 20 years ago to a lot of this open telemetry and monitoring and various STKs and developer tools is where like Docker and OpenStack and the STKs that I work on now, all very much focusing on developer as the user. >> Yeah, you're always on the wave, Erica great stuff. Casey, what's going on? Do you got some great ed techs happening? What's happening with you? >> Yeah, sure. The primary Open Source project that I'm contributing to right now is ACT. This is a tool I created a couple of years back when GitHub Actions first came out, and my motivation there was I'm just impatient. And that whole commit, push, wait time where you're testing out your pipelines is painful. And so I wanted to build a tool that allowed developers to test out their GitHub Actions workflows locally. And so this tool uses Docker containers to emulate, to get up action environment and gives you fast feedback on those workflows that you're building. Lot of innovation happening at GitHub. And so we're just trying to keep up and continue to replicate those new features functionalities in the local runner. And the biggest challenge I've had with this project is just keeping up with the community. We just passed 20,000 stars, and it'd be it's a normal week to get like 10 PRs. So super excited to announce just yesterday, actually I invited four of the most active contributors to help me with maintaining the project. And so this is like a big deal for me, letting the project go and bringing other people in to help lead it. So, yeah, huge shout out to those folks that have been helping with driving that project. So looking forward to what's next for it. >> Great, we'll make sure the SiliconANGLE riders catch that quote there. Great call out. Let's start, Brian, you made me realize when you mentioned Apache and then you've been watching all the stuff going on, it brings up the question of the evolution of Open Source, and the commercialization trends have been very interesting these days. You're seeing CloudScale really impact also with the growth of code. And Liz, if you remember, the Linux Foundation keeps making projections and they keep blowing past them every year on more and more code and more and more entrance coming in, not just individuals, corporations. So you starting to see Netflix donates something, you got Lyft donate some stuff, becomes a project company forms around it. There's a lot of entrepreneurial activity that's creating this new abstraction layers, new platforms, not just tools. So you start to see a new kickup trajectory with Open Source. You guys want to comment on this because this is going to impact how fast the enterprise will see value here. >> I think a really great example of that is a project called Backstage that's just come out of Spotify. And it's going through the incubation process at the CNCF. And that's why it's front of mind for me right now, 'cause I've been working on the due diligence for that. And the reason why I thought it was interesting in relation to your question is it's spun out of Spotify. It's fully Open Source. They have a ton of different enterprises using it as this developer portal, but they're starting to see some startups emerging offering like a hosted managed version of Backstage or offering services around Backstage or offering commercial plugins into Backstage. And I think it's really fascinating to see those ecosystems building up around a project and different ways that people can. I'm a big believer. You cannot sell the Open Source code, but you can sell other things that create value around Open Source projects. So that's really exciting to see. >> Great point. Anyone else want to weigh in and react to that? Because it's the new model. It's not the old way. I mean, I remember when I was in college, we had the Pirate software. Open Source wasn't around. So you had to deal under the table. Now it's free. But I mean the old way was you had to convince the enterprise, like you've got a hard knit, it builds the community and the community manage the quality of the code. And then you had to build the company to make sure they could support it. Now the companies are actually involved in it, right? And then new startups are forming faster. And the proof points are shorter and highly accelerated for that. I mean, it's a whole new- >> It's a Cambrian explosion, and it's great. It's one of those things that it's challenging for the new developers because they come in and they're like, "Whoa, what is all this stuff that I'm supposed to figure out?" And there's no right answer and there's no wrong answer. There's just tons of it. And I think that there's a desire for us to have one sort of well-known trot and happy path, that audience we're a lot better with a more diverse community, with lots of options, with lots of ways to approach these problems. And I think it's just great. A challenge that we have with all these options and all these Cambrian explosion of projects and all these competing ideas, right now, the sustainability, it's a bit of a tricky question to answer. We know that there's a commercialization aspect that helps us fund these projects, but how we compose the open versus the commercial source is still a bit of a tricky question and a tough one for a lot of folks. >> Erica, would you chime in on that for a second. I want to get your angle on that, this experience and all this code, and I'm a new person, I'm an existing person. Do I get like a blue check mark and verify? I mean, these are questions like, well, how do you navigate? >> Yeah, I think this has been something happening for a while. I mean, back in the early OpenStack days, 2010, for instance, Rackspace Open Sourcing, OpenStack and ANSU Labs and so forth, and then trying, having all these companies forming in creating startups around this. I started at a company called Cloudccaling back in late 2010, and we had some competitors such as Piston and so forth where a lot of the ANSUL Labs people went. But then, the real winners, I think from OpenStack ended up being the enterprises that jumped in. We had Red Hat in particular, as well as HP and IBM jumping in and investing in OpenStack, and really proving out a lot of... not that it was the first time, but this is when we started seeing billions of dollars pouring into Open Source projects and Open Source Foundations, such as the OpenStack Foundation, which proceeded a lot of the things that we now see with the Linux Foundation, which was then created a little bit later. And at the same time, I'm also reflecting a little bit what Brian said because there are projects that don't get funded, that don't get the same attention, but they're also getting used quite significantly. Things like Log4j really bringing this to the spotlight in terms of projects that are used everywhere by everything with significant outsized impacts on the industry that are not getting funded, that aren't flashy enough, that aren't exciting enough because it's just logging, but a vulnerability in it brings every everything and everybody down and has possibly billions of dollars of impact to our industry because nobody wanted to fund this project. >> I think that brings up the commercialization point about maybe bringing a venture capital model in saying, "Hey, that boring little logging thing could be a key ingredient for say solving some observability problems so I think let's put some cash." Again then we'd never seen that before. Now you're starting to see that kind of a real smart investment thesis going into Open Source projects. I mean, Promethease, Crafter, these are projects that turned off companies. This is turning up companies. >> A decade ago, there was no money in Dev tools that I think that's been fully debunked now. They used to be a concept that the venture community believed, but there's just too much evidence to the contrary, the companies like Cash Court, Datadog, the list goes on and on. I think the challenge for the Open Source (indistinct) comes back to foundations and working (indistinct) these developers make this code safe and secure. >> Casey, what's your reaction to all of this? You've got, so a project has gained some traction, got some momentum. There's a lot of mission critical. I won't say white spaces, but the opportunities in the big cloud game happening. And there's a lot of, I won't say too many entrepreneurial, but there's a lot of community action happening that's precommercialization that's getting traction. How does this all develop naturally and then vector in quickly when it hits? >> Yeah, I want to go back to the Log4j topic real quick. I think that it's a great example of an area that we need to do better at. And there was a cool article that Rob Pike wrote describing how to quantify the criticality. I think that's sort of quantifying criticality was the article he wrote on how to use metrics, to determine how valuable, how important a piece of Open Source is to the community. And we really need to highlight that more. We need a way to make it more clear how important this software is, how many people depend on it and how many people are contributing to it. And because right now we all do that. Like if I'm going to evaluate an Open Source software, sure, I'll look at how many stars it has and how many contributors it has. But I got to go through and do all that work myself and come up with. It would be really great if we had an agreed upon method for ranking the criticality of software, but then also the risk, hey, that this is used by a ton of people, but nobody's contributing to it anymore. That's a concern. And that would be great to potential users of that to signal whether or not it makes sense. The Open Source Security Foundation, just getting off the ground, they're doing some work in this space, and I'm really excited to see where they go with that looking at ways to stop score critically. >> Well, this brings up a good point while we've got everyone here, let's take a plug and plug a project you think that's not getting the visibility it needs. Let's go through each of you, point out a project that you think people should be looking at and talking about that might get some free visibility here. Anyone want to highlight projects they think should be focused more on, or that needs a little bit of love? >> I think, I mean, particularly if we're talking about these sort of vulnerability issues, there's a ton of work going on, like in the Secure Software Foundation, other foundations, I think there's work going on in Apache somewhere as well around the bill of material, the software bill of materials, the Secure Software supply chain security, even enumerating your dependencies is not trivial today. So I think there's going to be a ton of people doing really good work on that, as well as the criticality aspect. It's all like that. There's a really great xkcd cartoon with your software project and some really big monolithic lumps. And then, this tiny little piece in a very important point that's maintained by somebody in his bedroom in Montana or something and if you called it out. >> Yeah, you just opened where the next lightening and a bottle comes from. And this is I think the beauty of Open Source is that you get a little collaboration, you get three feet in a cloud of dust going and you get some momentum, and if it's relevant, it rises to the top. I think that's the collective intelligence of Open Source. The question I want to ask that the panel here is when you go into an enterprise, and now that the game is changing with a much more collaborative and involved, what's the story if they say, hey, what's in it for me, how do I manage the Open Source? What's the current best practice? Because there's no doubt I can't ignore it. It's in everything we do. How do I organize around it? How do I build around it to be more efficient and more productive and reduce the risk on vulnerabilities to managing staff, making sure the right teams in place, the right agility and all those things? >> You called it, they got to get skin in the game. They need to be active and involved and donating to a sustainable Open Source project is a great way to start. But if you really want to be active, then you should be committing. You should have a goal for your organization to be contributing back to that project. Maybe not committing code, it could be committing resources into the darks or in the tests, or even tweeting about an Open Source project is contributing to it. And I think a lot of these enterprises could benefit a lot from getting more active with the Open Source Foundations that are out there. >> Liz, you've been actively involved. I know we've talked personally when the CNCF started, which had a great commercial uptake from companies. What do you think the current state-of-the-art kind of equation is has it changed a little bit? Or is it the game still the same? >> Yeah, and in the early days of the CNCF, it was very much dominated by vendors behind the project. And now we're seeing more and more membership from end-user companies, the kind of enterprises that are building their businesses on Cloud Native, but their business is not in itself. That's not there. The infrastructure is not their business. And I think seeing those companies, putting money in, putting time in, as Brian says contributing resources quite often, there's enough money, but finding the talent to do the work and finding people who are prepared to actually chop the wood and carry the water, >> Exactly. >> that it's hard. >> And if enterprises can find peoples to spend time on Open Source projects, help with those chores, it's hugely valuable. And it's one of those the rising tide floats all the boats. We can raise security, we can reduce the amount of dependency on maintain projects collectively. >> I think the business models there, I think one of the things I'll react to and then get your guys' comments is remember which CubeCon it was, it was one of the early ones. And I remember seeing Apple having a booth, but nobody was manning. It was just an Apple booth. They weren't doing anything, but they were recruiting. And I think you saw the transition of a business model where the worry about a big vendor taking over a project and having undue influence over it goes away because I think this idea of participation is also talent, but also committing that talent back into the communities as a model, as a business model, like, okay, hire some great people, but listen, don't screw up the Open Source piece of it 'cause that's a critical. >> Also hire a channel, right? They can use those contributions to source that talent and build the reputation in the communities that they depend on. And so there's really a lot of benefit to the larger organizations that can do this. They'll have a huge pipeline of really qualified engineers right out the gate without having to resort to cheesy whiteboard interviews, which is pretty great. >> Yeah, I agree with a lot of this. One of my concerns is that a lot of these corporations tend to focus very narrowly on certain projects, which they feel that they depend greatly, they'll invest in OpenStack, they'll invest in Docker, they'll invest in some of the CNCF projects. And then these other projects get ignored. Something that I've been a proponent of for a little bit for a while is observability of your dependencies. And I don't think there's quite enough projects and solutions to this. And it sounds maybe from lists, there are some projects that I don't know about, but I also know that there's some startups like Snyk and so forth that help with a little bit of this problem, but I think we need more focus on some of these edges. And I think companies need to do better, both in providing, having some sort of solution for observability of the dependencies, as well as understanding those dependencies and managing them. I've seen companies for instance, depending on software that they actively don't want to use based on a certain criteria that they already set projects, like they'll set a requirement that any project that they use has a code of conduct, but they'll then use projects that don't have codes of conduct. And if they don't have a code of conduct, then employees are prohibited from working on those projects. So you've locked yourself into a place where you're depending on software that you have instructed, your employees are not allowed to contribute to, for certain legal and other reasons. So you need to draw a line in the sand and then recognize that those projects are ones that you don't want to consume, and then not use them, and have observability around these things. >> That's a great point. I think we have 10 minutes left. I want to just shift to a topic that I think is relevant. And that is as Open Source software, software, people develop software, you see under the hood kind of software, SREs developing very quickly in the CloudScale, but also you've got your classic software developers who were writing code. So you have supply chain, software supply chain challenges. You mentioned developer experience around how to code. You have now automation in place. So you've got the development of all these things that are happening. Like I just want to write software. Some people want to get and do infrastructure as code so DevSecOps is here. So how does that look like going forward? How has the future of Open Source going to make the developers just want to code quickly? And the folks who want to tweak the infrastructure a bit more efficient, any views on that? >> At Gaggle, we're using AWS' CDK, exclusively for our infrastructure as code. And it's a great transition for developers instead of writing Yammel or Jason, or even HCL for their infrastructure code, now they're writing code in the language that they're used to Python or JavaScript, and what that's providing is an easier transition for developers into that Infrastructure as code at Gaggle here, but it's also providing an opportunity to provide reusable constructs that some Devs can build on. So if we've got a very opinionated way to deploy a serverless app in a database and do auto-scaling behind and all stuff, we can present that to a developer as a library, and they can just consume it as it is. Maybe that's as deep as they want to go and they're happy with that. But then they want to go deeper into it, they can either use some of the lower level constructs or create PRs to the platform team to have those constructs changed to fit their needs. So it provides a nice on-ramp developers to use the tools and languages they're used to, and then also go deeper as they need. >> That's awesome. Does that mean they're not full stack developers anymore that they're half stack developers they're taking care of for them? >> I don't know either. >> We'll in. >> No, only kidding. Anyway, any other reactions to this whole? I just want to code, make it easy for me, and some people want to get down and dirty under the hood. >> So I think that for me, Docker was always a key part of this. I don't know when DevSecOps was coined exactly, but I was talking with people about it back in 2012. And when I joined Docker, it was a part of that vision for me, was that Docker was applying these security principles by default for your application. It wasn't, I mean, yes, everybody adopted because of the portability and the acceleration of development, but it was for me, the fact that it was limiting what you could do from a security angle by default, and then giving you these tuna balls that you can control it further. You asked about a project that may not get enough recognition is something called DockerSlim, which is designed to optimize your containers and will make them smaller, but it also constraints the security footprint, and we'll remove capabilities from the container. It will help you build security profiles for app armor and the Red Hat one. SELinux. >> SELinux. >> Yeah, and this is something that I think a lot of developers, it's kind of outside of the realm of things that they're really thinking about. So the more that we can automate those processes and make it easier out of the box for users or for... when I say users, I mean, developers, so that it's straightforward and automatic and also giving them the capability of refining it and tuning it as needed, or simply choosing platforms like serverless offerings, which have these security constraints built in out of the box and sometimes maybe less tuneable, but very strong by default. And I think that's a good place for us to be is where we just enforced these things and make you do things in a secure way. >> Yeah, I'm a huge fan of Kubernetes, but it's not the right hammer for every nail. And there are absolutely tons of applications that are better served by something like Lambda where a lot more of that security surface is taken care of for the developer. And I think we will see better tooling around security profiling and making it easier to shrink wrap your applications that there are plenty of products out there that can help you with this in a cloud native environment. But I think for the smaller developer let's say, or an earlier stage company, yeah, it needs to be so much more straightforward. Really does. >> Really an interesting time, 10 years ago, when I was working at Adobe, we used to requisition all these analysts to tell us how many developers there were for the market. And we thought there was about 20 million developers. If GitHub's to be believed, we think there is now around 80 million developers. So both these groups are probably wrong in their numbers, but the takeaway here for me is that we've got a lot of new developers and a lot of these new developers are really struck by a paradox of choice. And they're typically starting on the front end. And so there's a lot of movement in the stack moved towards the front end. We saw that at re:Invent when Amazon was really pushing Amplify 'cause they're seeing this too. It's interesting because this is where folks start. And so a lot of the obstructions are moving in that direction, but maybe not always necessarily totally appropriate. And so finding the right balance for folks is still a work in progress. Like Lambda is a great example. It lets me focus totally on just business logic. I don't have to think about infrastructure pretty much at all. And if I'm newer to the industry, that makes a lot of sense to me. As use cases expand, all of a sudden, reality intervenes, and it might not be appropriate for everything. And so figuring out what those edges are, is still the challenge, I think. >> All right, thank you very much for coming on the CUBE here panel. AWS Heroes, thanks everyone for coming. I really appreciate it, thank you. >> Thank you. >> Thank you. >> Okay. >> Thanks for having me. >> Okay, that's a wrap here back to the program and the awesome startups. Thanks for watching. (upbeat music)

Published Date : Jan 26 2022

SUMMARY :

and commercializing the value is important to you guys. and also the commercialization that reality all the time. Erica, what's your current and the STKs that I work on now, the wave, Erica great stuff. and continue to replicate those and the commercialization trends And the reason why I and the community manage that I'm supposed to figure out?" in on that for a second. that don't get the same attention, the commercialization point that the venture community believed, but the opportunities in the of that to signal whether and plug a project you think So I think there's going to be and now that the game is changing and donating to a sustainable Or is it the game still the same? but finding the talent to do the work the rising tide floats all the boats. And I think you saw the and build the reputation And I think companies need to do better, And the folks who want to in the language that they're Does that mean they're not and some people want to get and the acceleration of development, of the realm of things and making it easier to And so finding the right balance for folks for coming on the CUBE here panel. the awesome startups.

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Breaking Analysis: Enterprise Technology Predictions 2022


 

>> From theCUBE Studios in Palo Alto and Boston, bringing you data-driven insights from theCUBE and ETR, this is Breaking Analysis with Dave Vellante. >> The pandemic has changed the way we think about and predict the future. As we enter the third year of a global pandemic, we see the significant impact that it's had on technology strategy, spending patterns, and company fortunes Much has changed. And while many of these changes were forced reactions to a new abnormal, the trends that we've seen over the past 24 months have become more entrenched, and point to the way that's coming ahead in the technology business. Hello and welcome to this week's Wikibon CUBE Insights powered by ETR. In this Breaking Analysis, we welcome our partner and colleague and business friend, Erik Porter Bradley, as we deliver what's becoming an annual tradition for Erik and me, our predictions for Enterprise Technology in 2022 and beyond Erik, welcome. Thanks for taking some time out. >> Thank you, Dave. Luckily we did pretty well last year, so we were able to do this again. So hopefully we can keep that momentum going. >> Yeah, you know, I want to mention that, you know, we get a lot of inbound predictions from companies and PR firms that help shape our thinking. But one of the main objectives that we have is we try to make predictions that can be measured. That's why we use a lot of data. Now not all will necessarily fit that parameter, but if you've seen the grading of our 2021 predictions that Erik and I did, you'll see we do a pretty good job of trying to put forth prognostications that can be declared correct or not, you know, as black and white as possible. Now let's get right into it. Our first prediction, we're going to go run into spending, something that ETR surveys for quarterly. And we've reported extensively on this. We're calling for tech spending to increase somewhere around 8% in 2022, we can see there on the slide, Erik, we predicted spending last year would increase by 4% IDC. Last check was came in at five and a half percent. Gardner was somewhat higher, but in general, you know, not too bad, but looking ahead, we're seeing an acceleration from the ETR September surveys, as you can see in the yellow versus the blue bar in this chart, many of the SMBs that were hard hit by the pandemic are picking up spending again. And the ETR data is showing acceleration above the mean for industries like energy, utilities, retail, and services, and also, notably, in the Forbes largest 225 private companies. These are companies like Mars or Koch industries. They're predicting well above average spending for 2022. So Erik, please weigh in here. >> Yeah, a lot to bring up on this one, I'm going to be quick. So 1200 respondents on this, over a third of which were at the C-suite level. So really good data that we brought in, the usual bucket of, you know, fortune 500, global 2000 make up the meat of that median, but it's 8.3% and rising with momentum as we see. What's really interesting right now is that energy and utilities. This is usually like, you know, an orphan stock dividend type of play. You don't see them at the highest point of tech spending. And the reason why right now is really because this state of tech infrastructure in our energy infrastructure needs help. And it's obvious, remember the Florida municipality break reach last year? When they took over the water systems or they had the ability to? And this is a real issue, you know, there's bad nation state actors out there, and I'm no alarmist, but the energy and utility has to spend this money to keep up. It's really important. And then you also hit on the retail consumer. Obviously what's happened, the work from home shift created a shop from home shift, and the trends that are happening right now in retail. If you don't spend and keep up, you're not going to be around much longer. So I think the really two interesting things here to call out are energy utilities, usually a laggard in IT spend and it's leading, and also retail consumer, a lot of changes happening. >> Yeah. Great stuff. I mean, I recall when we entered the pandemic, really ETR was the first to emphasize the impact that work from home was going to have, so I really put a lot of weight on this data. Okay. Our next prediction is we're going to get into security, it's one of our favorite topics. And that is that the number one priority that needs to be addressed by organizations in 2022 is security and you can see, in this slide, the degree to which security is top of mind, relative to some other pretty important areas like cloud, productivity, data, and automation, and some others. Now people may say, "Oh, this is obvious." But I'm going to add some context here, Erik, and then bring you in. First, organizations, they don't have unlimited budgets. And there are a lot of competing priorities for dollars, especially with the digital transformation mandate. And depending on the size of the company, this data will vary. For example, while security is still number one at the largest public companies, and those are of course of the biggest spenders, it's not nearly as pronounced as it is on average, or in, for example, mid-sized companies and government agencies. And this is because midsized companies or smaller companies, they don't have the resources that larger companies do. Larger companies have done a better job of securing their infrastructure. So these mid-size firms are playing catch up and the data suggests cyber is even a bigger priority there, gaps that they have to fill, you know, going forward. And that's why we think there's going to be more demand for MSSPs, managed security service providers. And we may even see some IPO action there. And then of course, Erik, you and I have talked about events like the SolarWinds Hack, there's more ransomware attacks, other vulnerabilities. Just recently, like Log4j in December. All of this has heightened concerns. Now I want to talk a little bit more about how we measure this, you know, relatively, okay, it's an obvious prediction, but let's stick our necks out a little bit. And so in addition to the rise of managed security services, we're calling for M&A and/or IPOs, we've specified some names here on this chart, and we're also pointing to the digital supply chain as an area of emphasis. Again, Log4j really shone that under a light. And this is going to help the likes of Auth0, which is now Okta, SailPoint, which is called out on this chart, and some others. We're calling some winners in end point security. Erik, you're going to talk about sort of that lifecycle, that transformation that we're seeing, that migration to new endpoint technologies that are going to benefit from this reset refresh cycle. So Erik, weigh in here, let's talk about some of the elements of this prediction and some of the names on that chart. >> Yeah, certainly. I'm going to start right with Log4j top of mind. And the reason why is because we're seeing a real paradigm shift here where things are no longer being attacked at the network layer, they're being attacked at the application layer, and in the application stack itself. And that is a huge shift left. And that's taking in DevSecOps now as a real priority in 2022. That's a real paradigm shift over the last 20 years. That's not where attacks used to come from. And this is going to have a lot of changes. You called out a bunch of names in there that are, they're either going to work. I would add to that list Wiz. I would add Orca Security. Two names in our emerging technology study, in addition to the ones you added that are involved in cloud security and container security. These names are either going to get gobbled up. So the traditional legacy names are going to have to start writing checks and, you know, legacy is not fair, but they're in the data center, right? They're, on-prem, they're not cloud native. So these are the names that money is going to be flowing to. So they're either going to get gobbled up, or we're going to see some IPO's. And on the other thing I want to talk about too, is what you mentioned. We have CrowdStrike on that list, We have SentinalOne on the list. Everyone knows them. Our data was so strong on Tanium that we actually went positive for the first time just today, just this morning, where that was released. The trifecta of these are so important because of what you mentioned, under resourcing. We can't have security just tell us when something happens, it has to automate, and it has to respond. So in this next generation of EDR and XDR, an automated response has to happen because people are under-resourced, salaries are really high, there's a skill shortage out there. Security has to become responsive. It can't just monitor anymore. >> Yeah. Great. And we should call out too. So we named some names, Snyk, Aqua, Arctic Wolf, Lacework, Netskope, Illumio. These are all sort of IPO, or possibly even M&A candidates. All right. Our next prediction goes right to the way we work. Again, something that ETR has been on for awhile. We're calling for a major rethink in remote work for 2022. We had predicted last year that by the end of 2021, there'd be a larger return to the office with the norm being around a third of workers permanently remote. And of course the variants changed that equation and, you know, gave more time for people to think about this idea of hybrid work and that's really come in to focus. So we're predicting that is going to overtake fully remote as the dominant work model with only about a third of the workers back in the office full-time. And Erik, we expect a somewhat lower percentage to be fully remote. It's now sort of dipped under 30%, at around 29%, but it's still significantly higher than the historical average of around 15 to 16%. So still a major change, but this idea of hybrid and getting hybrid right, has really come into focus. Hasn't it? >> Yeah. It's here to stay. There's no doubt about it. We started this in March of 2020, as soon as the virus hit. This is the 10th iteration of the survey. No one, no one ever thought we'd see a number where only 34% of people were going to be in office permanently. That's a permanent number. They're expecting only a third of the workers to ever come back fully in office. And against that, there's 63% that are saying their permanent workforce is going to be either fully remote or hybrid. And this, I can't really explain how big of a paradigm shift this is. Since the start of the industrial revolution, people leave their house and go to work. Now they're saying that's not going to happen. The economic impact here is so broad, on so many different areas And, you know, the reason is like, why not? Right? The productivity increase is real. We're seeing the productivity increase. Enterprises are spending on collaboration tools, productivity tools, We're seeing an increased perception in productivity of their workforce. And the CFOs can cut down an expense item. I just don't see a reason why this would end, you know, I think it's going to continue. And I also want to point out these results, as high as they are, were before the Omicron wave hit us. I can only imagine what these results would have been if we had sent the survey out just two or three weeks later. >> Yeah. That's a great point. Okay. Next prediction, we're going to look at the supply chain, specifically in how it's affecting some of the hardware spending and cloud strategies in the future. So in this chart, ETRS buyers, have you experienced problems procuring hardware as a result of supply chain issues? And, you know, despite the fact that some companies are, you know, I would call out Dell, for example, doing really well in terms of delivering, you can see that in the numbers, it's pretty clear, there's been an impact. And that's not not an across the board, you know, thing where vendors are able to deliver, especially acute in PCs, but also pronounced in networking, also in firewall servers and storage. And what's interesting is how companies are responding and reacting. So first, you know, I'm going to call the laptop and PC demand staying well above pre-COVID norms. It had peaked in 2012. Pre-pandemic it kept dropping and dropping and dropping, in terms of, you know, unit volume, where the market was contracting. And we think can continue to grow this year in double digits in 2022. But what's interesting, Erik, is when you survey customers, is despite the difficulty they're having in procuring network hardware, there's as much of a migration away from existing networks to the cloud. You could probably comment on that. Their networks are more fossilized, but when it comes to firewalls and servers and storage, there's a much higher propensity to move to the cloud. 30% of customers that ETR surveyed will replace security appliances with cloud services and 41% and 34% respectively will move to cloud compute and storage in 2022. So cloud's relentless march on traditional on-prem models continues. Erik, what do you make of this data? Please weigh in on this prediction. >> As if we needed another reason to go to the cloud. Right here, here it is yet again. So this was added to the survey by client demand. They were asking about the procurement difficulties, the supply chain issues, and how it was impacting our community. So this is the first time we ran it. And it really was interesting to see, you know, the move there. And storage particularly I found interesting because it correlated with a huge jump that we saw on one of our vendor names, which was Rubrik, had the highest net score that it's ever had. So clearly we're seeing some correlation with some of these names that are there, you know, really well positioned to take storage, to take data into the cloud. So again, you didn't need another reason to, you know, hasten this digital transformation, but here we are, we have it yet again, and I don't see it slowing down anytime soon. >> You know, that's a really good point. I mean, it's not necessarily bad news for the... I mean, obviously you wish that it had no change, would be great, but things, you know, always going to change. So we'll talk about this a little bit later when we get into the Supercloud conversation, but this is an opportunity for people who embrace the cloud. So we'll come back to that. And I want to hang on cloud a bit and share some recent projections that we've made. The next prediction is the big four cloud players are going to surpass 167 billion, an IaaS and PaaS revenue in 2022. We track this. Observers of this program know that we try to create an apples to apples comparison between AWS, Azure, GCP and Alibaba in IaaS and PaaS. So we're calling for 38% revenue growth in 2022, which is astounding for such a massive market. You know, AWS is probably not going to hit a hundred billion dollar run rate, but they're going to be close this year. And we're going to get there by 2023, you know they're going to surpass that. Azure continues to close the gap. Now they're about two thirds of the size of AWS and Google, we think is going to surpass Alibaba and take the number three spot. Erik, anything you'd like to add here? >> Yeah, first of all, just on a sector level, we saw our sector, new survey net score on cloud jumped another 10%. It was already really high at 48. Went up to 53. This train is not slowing down anytime soon. And we even added an edge compute type of player, like CloudFlare into our cloud bucket this year. And it debuted with a net score of almost 60. So this is really an area that's expanding, not just the big three, but everywhere. We even saw Oracle and IBM jump up. So even they're having success, taking some of their on-prem customers and then selling them to their cloud services. This is a massive opportunity and it's not changing anytime soon, it's going to continue. >> And I think the operative word there is opportunity. So, you know, the next prediction is something that we've been having fun with and that's this Supercloud becomes a thing. Now, the reason I say we've been having fun is we put this concept of Supercloud out and it's become a bit of a controversy. First, you know, what the heck's the Supercloud right? It's sort of a buzz-wordy term, but there really is, we believe, a thing here. We think there needs to be a rethinking or at least an evolution of the term multi-cloud. And what we mean is that in our view, you know, multicloud from a vendor perspective was really cloud compatibility. It wasn't marketed that way, but that's what it was. Either a vendor would containerize its legacy stack, shove it into the cloud, or a company, you know, they'd do the work, they'd build a cloud native service on one of the big clouds and they did do it for AWS, and then Azure, and then Google. But there really wasn't much, if any, leverage across clouds. Now from a buyer perspective, we've always said multicloud was a symptom of multi-vendor, meaning I got different workloads, running in different clouds, or I bought a company and they run on Azure, and I do a lot of work on AWS, but generally it wasn't necessarily a prescribed strategy to build value on top of hyperscale infrastructure. There certainly was somewhat of a, you know, reducing lock-in and hedging the risk. But we're talking about something more here. We're talking about building value on top of the hyperscale gift of hundreds of billions of dollars in CapEx. So in addition, we're not just talking about transforming IT, which is what the last 10 years of cloud have been like. And, you know, doing work in the cloud because it's cheaper or simpler or more agile, all of those things. So that's beginning to change. And this chart shows some of the technology vendors that are leaning toward this Supercloud vision, in our view, building on top of the hyperscalers that are highlighted in red. Now, Jerry Chan at Greylock, they wrote a piece called Castles in the Cloud. It got our thinking going, and he and the team at Greylock, they're building out a database of all the cloud services and all the sub-markets in cloud. And that got us thinking that there's a higher level of abstraction coalescing in the market, where there's tight integration of services across clouds, but the underlying complexity is hidden, and there's an identical experience across clouds, and even, in my dreams, on-prem for some platforms, so what's new or new-ish and evolving are things like location independence, you've got to include the edge on that, metadata services to optimize locality of reference and data source awareness, governance, privacy, you know, application independent and dependent, actually, recovery across clouds. So we're seeing this evolve. And in our view, the two biggest things that are new are the technology is evolving, where you're seeing services truly integrate cross-cloud. And the other big change is digital transformation, where there's this new innovation curve developing, and it's not just about making your IT better. It's about SaaS-ifying and automating your entire company workflows. So Supercloud, it's not just a vendor thing to us. It's the evolution of, you know, the, the Marc Andreessen quote, "Every company will be a SaaS company." Every company will deliver capabilities that can be consumed as cloud services. So Erik, the chart shows spending momentum on the y-axis and net score, or presence in the ETR data center, or market share on the x-axis. We've talked about snowflake as the poster child for this concept where the vision is you're in their cloud and sharing data in that safe place. Maybe you could make some comments, you know, what do you think of this Supercloud concept and this change that we're sensing in the market? >> Well, I think you did a great job describing the concept. So maybe I'll support it a little bit on the vendor level and then kind of give examples of the ones that are doing it. You stole the lead there with Snowflake, right? There is no better example than what we've seen with what Snowflake can do. Cross-portability in the cloud, the ability to be able to be, you know, completely agnostic, but then build those services on top. They're better than anything they could offer. And it's not just there. I mean, you mentioned edge compute, that's a whole nother layer where this is coming in. And CloudFlare, the momentum there is out of control. I mean, this is a company that started off just doing CDN and trying to compete with Okta Mite. And now they're giving you a full soup to nuts with security and actual edge compute layer, but it's a fantastic company. What they're doing, it's another great example of what you're seeing here. I'm going to call out HashiCorp as well. They're more of an infrastructure services, a little bit more of an open-source freemium model, but what they're doing as well is completely cloud agnostic. It's dynamic. It doesn't care if you're in a container, it doesn't matter where you are. They recently IPO'd and they're down 25%, but their data looks so good across both of our emerging technology and TISA survey. It's certainly another name that's playing on this. And another one that we mentioned as well is Rubrik. If you need storage, compute, and in the cloud layer and you need to be agnostic to it, they're another one that's really playing in this space. So I think it's a great concept you're bringing up. I think it's one that's here to stay and there's certainly a lot of vendors that fit into what you're describing. >> Excellent. Thank you. All right, let's shift to data. The next prediction, it might be a little tough to measure. Before I said we're trying to be a little black and white here, but it relates to Data Mesh, which is, the ideas behind that term were created by Zhamak Dehghani of ThoughtWorks. And we see Data Mesh is really gaining momentum in 2022, but it's largely going to be, we think, confined to a more narrow scope. Now, the impetus for change in data architecture in many companies really stems from the fact that their Hadoop infrastructure really didn't solve their data problems and they struggle to get more value out of their data investments. Data Mesh prescribes a shift to a decentralized architecture in domain ownership of data and a shift to data product thinking, beyond data for analytics, but data products and services that can be monetized. Now this a very powerful in our view, but they're difficult for organizations to get their heads around and further decentralization creates the need for a self-service platform and federated data governance that can be automated. And not a lot of standards around this. So it's going to take some time. At our power panel a couple of weeks ago on data management, Tony Baer predicted a backlash on Data Mesh. And I don't think it's going to be so much of a backlash, but rather the adoption will be more limited. Most implementations we think are going to use a starting point of AWS and they'll enable domains to access and control their own data lakes. And while that is a very small slice of the Data Mesh vision, I think it's going to be a starting point. And the last thing I'll say is, this is going to take a decade to evolve, but I think it's the right direction. And whether it's a data lake or a data warehouse or a data hub or an S3 bucket, these are really, the concept is, they'll eventually just become nodes on the data mesh that are discoverable and access is governed. And so the idea is that the stranglehold that the data pipeline and process and hyper-specialized roles that they have on data agility is going to evolve. And decentralized architectures and the democratization of data will eventually become a norm for a lot of different use cases. And Erik, I wonder if you'd add anything to this. >> Yeah. There's a lot to add there. The first thing that jumped out to me was that that mention of the word backlash you said, and you said it's not really a backlash, but what it could be is these are new words trying to solve an old problem. And I do think sometimes the industry will notice that right away and maybe that'll be a little pushback. And the problems are what you already mentioned, right? We're trying to get to an area where we can have more assets in our data site, more deliverable, and more usable and relevant to the business. And you mentioned that as self-service with governance laid on top. And that's really what we're trying to get to. Now, there's a lot of ways you can get there. Data fabric is really the technical aspect and data mesh is really more about the people, the process, and the governance, but the two of those need to meet, in order to make that happen. And as far as tools, you know, there's even cataloging names like Informatica that play in this, right? Istio plays in this, Snowflake plays in this. So there's a lot of different tools that will support it. But I think you're right in calling out AWS, right? They have AWS Lake, they have AWS Glue. They have so much that's trying to drive this. But I think the really important thing to keep here is what you said. It's going to be a decade long journey. And by the way, we're on the shoulders of giants a decade ago that have even gotten us to this point to talk about these new words because this has been an ongoing type of issue, but ultimately, no matter which vendors you use, this is going to come down to your data governance plan and the data literacy in your business. This is really about workflows and people as much as it is tools. So, you know, the new term of data mesh is wonderful, but you still have to have the people and the governance and the processes in place to get there. >> Great, thank you for that, Erik. Some great points. All right, for the next prediction, we're going to shine the spotlight on two of our favorite topics, Snowflake and Databricks, and the prediction here is that, of course, Databricks is going to IPO this year, as expected. Everybody sort of expects that. And while, but the prediction really is, well, while these two companies are facing off already in the market, they're also going to compete with each other for M&A, especially as Databricks, you know, after the IPO, you're going to have, you know, more prominence and a war chest. So first, these companies, they're both looking pretty good, the same XY graph with spending velocity and presence and market share on the horizontal axis. And both Snowflake and Databricks are well above that magic 40% red dotted line, the elevated line, to us. And for context, we've included a few other firms. So you can see kind of what a good position these two companies are really in, especially, I mean, Snowflake, wow, it just keeps moving to the right on this horizontal picture, but maintaining the next net score in the Y axis. Amazing. So, but here's the thing, Databricks is using the term Lakehouse implying that it has the best of data lakes and data warehouses. And Snowflake has the vision of the data cloud and data sharing. And Snowflake, they've nailed analytics, and now they're moving into data science in the domain of Databricks. Databricks, on the other hand, has nailed data science and is moving into the domain of Snowflake, in the data warehouse and analytics space. But to really make this seamless, there has to be a semantic layer between these two worlds and they're either going to build it or buy it or both. And there are other areas like data clean rooms and privacy and data prep and governance and machine learning tooling and AI, all that stuff. So the prediction is they'll not only compete in the market, but they'll step up and in their competition for M&A, especially after the Databricks IPO. We've listed some target names here, like Atscale, you know, Iguazio, Infosum, Habu, Immuta, and I'm sure there are many, many others. Erik, you care to comment? >> Yeah. I remember a year ago when we were talking Snowflake when they first came out and you, and I said, "I'm shocked if they don't use this war chest of money" "and start going after more" "because we know Slootman, we have so much respect for him." "We've seen his playbook." And I'm actually a little bit surprised that here we are, at 12 months later, and he hasn't spent that money yet. So I think this prediction's just spot on. To talk a little bit about the data side, Snowflake is in rarefied air. It's all by itself. It is the number one net score in our entire TISA universe. It is absolutely incredible. There's almost no negative intentions. Global 2000 organizations are increasing their spend on it. We maintain our positive outlook. It's really just, you know, stands alone. Databricks, however, also has one of the highest overall net sentiments in the entire universe, not just its area. And this is the first time we're coming up positive on this name as well. It looks like it's not slowing down. Really interesting comment you made though that we normally hear from our end-user commentary in our panels and our interviews. Databricks is really more used for the data science side. The MLAI is where it's best positioned in our survey. So it might still have some catching up to do to really have that caliber of usability that you know Snowflake is seeing right now. That's snowflake having its own marketplace. There's just a lot more to Snowflake right now than there is Databricks. But I do think you're right. These two massive vendors are sort of heading towards a collision course, and it'll be very interesting to see how they deploy their cash. I think Snowflake, with their incredible management and leadership, probably will make the first move. >> Well, I think you're right on that. And by the way, I'll just add, you know, Databricks has basically said, hey, it's going to be easier for us to come from data lakes into data warehouse. I'm not sure I buy that. I think, again, that semantic layer is a missing ingredient. So it's going to be really interesting to see how this plays out. And to your point, you know, Snowflake's got the war chest, they got the momentum, they've got the public presence now since November, 2020. And so, you know, they're probably going to start making some aggressive moves. Anyway, next prediction is something, Erik, that you and I have talked about many, many times, and that is observability. I know it's one of your favorite topics. And we see this world screaming for more consolidation it's going all in on cloud native. These legacy stacks, they're fighting to stay relevant, but the direction is pretty clear. And the same XY graph lays out the players in the field, with some of the new entrants that we've also highlighted, like Observe and Honeycomb and ChaosSearch that we've talked about. Erik, we put a big red target around Splunk because everyone wants their gold. So please give us your thoughts. >> Oh man, I feel like I've been saying negative things about Splunk for too long. I've got a bad rap on this name. The Splunk shareholders come after me all the time. Listen, it really comes down to this. They're a fantastic company that was designed to do logging and monitoring and had some great tool sets around what you could do with it. But they were designed for the data center. They were designed for prem. The world we're in now is so dynamic. Everything I hear from our end user community is that all net new workloads will be going to cloud native players. It's that simple. So Splunk has entrenched. It's going to continue doing what it's doing and it does it really, really well. But if you're doing something new, the new workloads are going to be in a dynamic environment and that's going to go to the cloud native players. And in our data, it is extremely clear that that means Datadog and Elastic. They are by far number one and two in net score, increase rates, adoption rates. It's not even close. Even New Relic actually is starting to, you know, entrench itself really well. We saw New Relic's adoption's going up, which is super important because they went to that freemium model, you know, to try to get their little bit of an entrenched customer base and that's working as well. And then you made a great list here, of all the new entrants, but it goes beyond this. There's so many more. In our emerging technology survey, we're seeing Century, Catchpoint, Securonix, Lucid Works. There are so many options in this space. And let's not forget, the biggest data that we're seeing is with Grafana. And Grafana labs as yet to turn on their enterprise. Elastic did it, why can't Grafana labs do it? They have an enterprise stack. So when you look at how crowded this space is, there has to be consolidation. I recently hosted a panel and every single guy on that panel said, "Please give me a consolidation." Because they're the end users trying to actually deploy these and it's getting a little bit confusing. >> Great. Thank you for that. Okay. Last prediction. Erik, might be a little out of your wheelhouse, but you know, you might have some thoughts on it. And that's a hybrid events become the new digital model and a new category in 2022. You got these pure play digital or virtual events. They're going to take a back seat to in-person hybrids. The virtual experience will eventually give way to metaverse experiences and that's going to take some time, but the physical hybrid is going to drive it. And metaverse is ultimately going to define the virtual experience because the virtual experience today is not great. Nobody likes virtual. And hybrid is going to become the business model. Today's pure virtual experience has to evolve, you know, theCUBE first delivered hybrid mid last decade, but nobody really wanted it. We did Mobile World Congress last summer in Barcelona in an amazing hybrid model, which we're showing in some of the pictures here. Alex, if you don't mind bringing that back up. And every physical event that we're we're doing now has a hybrid and virtual component, including the pre-records. You can see in our studios, you see that the green screen. I don't know. Erik, what do you think about, you know, the Zoom fatigue and all this. I know you host regular events with your round tables, but what are your thoughts? >> Well, first of all, I think you and your company here have just done an amazing job on this. So that's really your expertise. I spent 20 years of my career hosting intimate wall street idea dinners. So I'm better at navigating a wine list than I am navigating a conference floor. But I will say that, you know, the trend just goes along with what we saw. If 35% are going to be fully remote. If 70% are going to be hybrid, then our events are going to be as well. I used to host round table dinners on, you know, one or two nights a week. Now those have gone virtual. They're now panels. They're now one-on-one interviews. You know, we do chats. We do submitted questions. We do what we can, but there's no reason that this is going to change anytime soon. I think you're spot on here. >> Yeah. Great. All right. So there you have it, Erik and I, Listen, we always love the feedback. Love to know what you think. Thank you, Erik, for your partnership, your collaboration, and love doing these predictions with you. >> Yeah. I always enjoy them too. And I'm actually happy. Last year you made us do a baker's dozen, so thanks for keeping it to 10 this year. >> (laughs) We've got a lot to say. I know, you know, we cut out. We didn't do much on crypto. We didn't really talk about SaaS. I mean, I got some thoughts there. We didn't really do much on containers and AI. >> You want to keep going? I've got another 10 for you. >> RPA...All right, we'll have you back and then let's do that. All right. All right. Don't forget, these episodes are all available as podcasts, wherever you listen, all you can do is search Breaking Analysis podcast. Check out ETR's website at etr.plus, they've got a new website out. It's the best data in the industry, and we publish a full report every week on wikibon.com and siliconangle.com. You can always reach out on email, David.Vellante@siliconangle.com I'm @DVellante on Twitter. Comment on our LinkedIn posts. This is Dave Vellante for the Cube Insights powered by ETR. Have a great week, stay safe, be well. And we'll see you next time. (mellow music)

Published Date : Jan 22 2022

SUMMARY :

bringing you data-driven and predict the future. So hopefully we can keep to mention that, you know, And this is a real issue, you know, And that is that the number one priority and in the application stack itself. And of course the variants And the CFOs can cut down an expense item. the board, you know, thing interesting to see, you know, and take the number three spot. not just the big three, but everywhere. It's the evolution of, you know, the, the ability to be able to be, and the democratization of data and the processes in place to get there. and is moving into the It is the number one net score And by the way, I'll just add, you know, and that's going to go to has to evolve, you know, that this is going to change anytime soon. Love to know what you think. so thanks for keeping it to 10 this year. I know, you know, we cut out. You want to keep going? This is Dave Vellante for the

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Breaking Analysis: Cyber, Cloud, Hybrid Work & Data Drive 8% IT Spending Growth in 2021


 

>> From theCUBE studios in Palo Alto and Boston, bringing you data-driven insights from theCUBE in ETR. This is Breaking Analysis with Dave Vellante. >> Every CEO is figuring out the right balance for new hybrid business models. Now, regardless of the chosen approach, which is going to vary, technology executives, they understand they have to accelerate their digital and build resilience as well as optionality into their platforms. Now, this is driving a dramatic shift in IT investments. And at the macro level, we expect total spending to increase at as much as 8% or even more in 2021, compared to last year's contraction. Investments in cybersecurity, cloud collaboration that are enabling hybrid work as well as data, including analytics, AI, and automation are at the top of the spending priorities for CXOs. Hello everyone. And welcome to this week's Wiki Bond Cube insights, powered by ETR. In this Breaking Analysis, we're pleased to welcome back Erik Bradley, who is the chief engagement strategist at our partner, ETR. Now in this segment, we're going to share some of the latest findings from ETR's surveys and provide our commentary on what it means for the markets, for sellers, and for buyers. Erik, great to see you, my friend. Welcome back to Breaking Analysis. >> Thank you for having me, always enjoy it. We've got some fresh data to talk about on this beautiful summer Friday, so I'm ready to go. >> All right. I'm excited too. Okay, last year we saw a contraction in IT spending by at least 5%. And now we're seeing a snapback to, as I said, at least 8% growth relative to last year. You got to go back to 2007 just before the financial crisis to see this type of top line growth. The shift to hybrid work, it's exposed us to new insidious security threats. And we're going to discuss that in a lot more detail. Cloud migration of course picked up dramatically last year, and based on the recent earnings results of the big cloud players, for now we got two quarters of data, that trend continues as organizations are accelerating their digital platform build-outs, and this is bringing a lot of complexity and a greater need for so-called observability solutions, which Erik is going to talk about extensively later on in this segment. Data, we think is entering a new era of de-centralization. We see organizations not only focused on analytics and insights, but actually creating data products. Leading technology organizations like JP Morgan, they're heavily leaning into this trend toward packaging and monetizing data products. And finally, as part of the digital transformation trend, we see no slow down in spending momentum for AI and automation, generally in RPA specifically. Erik, anything you want to add to that top level narrative? >> Yeah, there's a lot to take on the macro takeaways. The first thing I want to state is that that 8, 8.5% number that started off at just 3 to 4% beginning of the year. So as the year has continued, we are just seeing this trend in budgets continue to accelerate, and we don't have any reason to believe that's going to stop. So I think we're going to just keep moving on heading into 2021. And we're going to see a banner year of spend this year and probably next as well. >> All right, now we're going to bring up a chart that shows kind of that progression here of spending momentum. So Erik, I'm going to let you comment on this chart that tracks those projections over time. >> Erik: Yeah. Great. So thank you very much for pulling this up. As you can see in the beginning part of the year, when we asked people, "What do you plan to spend throughout 2021?" They were saying it would be about a 4% increase. Which we were happy with because as you said last year, it was all negative. That continues to accelerate and is only hyper accelerating now as we head into the back half of the year. In addition, after we do this data, I always host a panel of IT end users to kind of get their feedback on what we collected, to a man, every one of them expects continued increase throughout next year. There are some concerns and uncertainty about what we're seeing right now with COVID, but even with that, they're planning their budgets now for 2022 and they're planning for even further increases going forward. >> Dave: Great, thank you. So we circled that 8%. That's really kind of where we thought it was going to land. And so we're happy with that number, but let's take a look at where the action is by technology sector. This chart that we're showing you here, it tracks spending priorities back to last September. When I believe that was the point, Erik, that cyber became the top priority in the survey, ahead of cloud collaboration, analytics, and data, and the other sectors that you see there. Now, Erik, we should explain. These areas, they're the top seven, and they outrank all the other sectors. ETR tracks many, many other sectors, but please weigh in here and share your thoughts on this data. >> Erik: Yeah. Security, security, security. It hasn't changed. It had really hasn't. The hybrid work. The fact that you're behind the firewall one day and then you're outside working from home the next, switching in and out of networks. This is just a field day for bad actors. And we have no choice right now, but to continue to spend, because as you're going to talk about in a minute, hybrid's here to stay. So we have to figure out a way to secure behind the firewall on-prem. We also have to secure our employees and our assets that are not in the office. So it is a main priority. One of the things that point out on this chart, I had a couple of ITN users talk to me about customer experience and automation really need to move from the right part of that chart to the left. So they're seeing more in what you were talking about in RPA and automation, starting to creep up heading into next year. As cloud migration matures, as you know, cybersecurity spending has been ramping up. People are going to see a little bit more on the analytics and a little bit more on the automation side going forward. >> Dave: Great. Now, this next data view- well, first of all, one of the great things about the ETR dataset is that you can ask key questions and get a time series. And I will tell you again, I go back to last March, ETR hit it. They were the first on the work from home trend. And so if you were on that trend, you were able to anticipate it. And a lot of investors I think took advantage of that. Now, but we've shown this before, but there's new data points that we want to introduce. So the data tracks how CIOs and IT buyers have responded to the pandemic since last March. Still 70% of the organizations have employees working remotely, but 39% now have employees fully returning to the office and Erik, the rest of the metrics all point toward positives for IT spending, although accelerating IT deployments there at the right peaked last year, as people realized they had to invest in the future. Your thoughts? >> Erik: Yeah, this is the slide for optimism, without a doubt. Of the entire macro survey we did, this is the most optimistic slide. It's great for overall business. It's great for business travel. This is well beyond just IT. Hiring is up. I've had some people tell me that they possibly can't hire enough people right now. They had to furlough employees, they had to stop projects, and they want to re accelerate those now. But talent is very hard to find. Another point to you about your automation and RPA, another underlying trend for there. The one thing I did want to talk about here is the hybrid workplace, but I believe there's another slide on it. So just to recap on this extremely optimistic, we're seeing a lot of hiring. We're seeing increased spending, and I do believe that that's going to continue. >> Yeah I'm glad you brought that up because a session that you and I did a while ago, we pointed out, it was earlier this year, that the skill shortage is one potential risk to our positive scenario. We'll keep an eye on that, but so I want to show another set of data that we've showed previously, but ETR again, has added some new questions in here. So note here that 60% of employees still work remotely with 33% in a hybrid model currently, and the CIO's expect that to land on about 42% hybrid workforce with around 30% working remotely, which is around, it's been consistent by the way on your surveys, but that's about double the historic norm, Eric. >> Erik: Yeah, and even further to your point Dave, recently I did a panel asking people to give me some feedback on this. And three of those four experts basically said to me, if we had greed run this survey right now, that even more people would be saying remote. That they believe that that number, that's saying they're expecting that number of people to be back in office, is actually too optimistic. They're actually saying that maybe if we had- cause as a survey launched about six, seven weeks ago before this little blip on the radar, before the little COVID hiccup we're seeing now, and they're telling me that they believe if we reran this now that it would be even more remote work, even more hybrid and less returned to the office. So that's just an update I wanted to offer on this slide. >> Dave: Yeah. Thank you for that. I mean, we're still in this kind of day to day, week to week, month to month mode, but I want to do a little double click on this. We're not going to share this data, but there was so much ETR data. We got to be selective. But if you double click on the hybrid models, you'll see that 50% of organizations plan to have time roughly equally split between onsite and remote with again around 30 or 31% mostly remote, with onsite space available if they need it. And Erik, very few don't plan to have some type of hybrid model, at least. >> Yeah, I think it was less than 10% that said it was going to be exclusively onsite. And again, that was a more optimistic scenario six, seven weeks ago than we're seeing right now throughout the country. So I agree with you, hybrid is here to stay. There really is no doubt about it. from everyone I speak to when, you know, I basically make a living talking to IT end users. Hybrid is here to stay. They're planning for it. And that's really the drive behind the spending because you have to support both. You have to give people the option. You have to, from an IT perspective, you also have to support both, right? So if somebody is in office, I need the support staff to be in office. Plus I need them to be able to remote in and fix something from home. So they're spending on both fronts right now. >> Okay. Let's get into some of the vendor performance data. And I want to start with the cloud hyperscalers. It's something that we followed pretty closely. I got some Wiki bond data, that we just had earnings released. So here's data that shows the Q2 revenue shares on the left-hand side in the pie and the growth rates for the big four cloud players on the right hand side. It goes back to Q1 2019. Now the first thing I want to say is these players generated just under $39 billion in the quarter with AWS capturing 50% of that number. I said 39, it was 29 billion, sorry, with AWS capturing 50% of that in the quarter. As you're still tracking around a third in Alibaba and GCP in the, you know, eight or 9% range. But what's most interesting to me, Erik, is that AWS, which generated almost 15 billion in the quarter, was the only player to grow its revenue, both sequentially and year over year. And Erik, I think the street is missing the real story here on Amazon. Amazon announced earnings on Thursday night. The company had a 2% miss on the top line revenues and a meaningful 22% beat on earnings per share. So the retail side of the business missed its revenue targets, so that's why everybody's freaked out. But AWS, the cloud side, saw a 4% revenue beat. So the stock was off more than 70% after hours and into Friday. Now to me, a mix shift toward AWS, that's great news for investors. Now, tepid guidance is a negative, but the shift to a more profitable cloud business is a huge positive. >> Yeah, there's a lot that goes into stock price, right? I remember I was a director of research back in the day. One of my analysts said to me, "Am I crazy for putting a $1,000 target on Amazon?" And I laughed and I said, "No, you're crazy if you don't make it $2,000." (both chuckling) So, you know, at that time it was basically the mix shift towards AWS. You're a thousand percent right. I think the tough year over year comps had something to do with that reaction. That, you know, it's just getting really hard. What's that? The law of large numbers, right? It's really hard to grow at that percentage rate when you're getting this big. But from our data perspective, we're seeing no slowdown in AWS, in cloud, none whatsoever. The only slowdown we're seeing in cloud is GCP. But to, you know, to focus on AWS, extremely strong across the board and not only just in cloud, but in all their data products as well, data and analytics. >> Yeah and I think that the AWS, don't forget folks, that funds Amazon's TAM expansion into so many different places. Okay. As we said at the top, the world of digital and hybrid work, and multi-cloud, it's more complicated than it used to be. And that means if you need to resolve issues, which everybody does, like poor application performance, et cetera, what's happening at the user level, you have to have a better way to sort of see what's going on. And that's what the emergence of the observability space is all about. So Erik, let me set this up and you have a lot of comments here because you've recently had some, and you always have had a lot of round table discussions with CXOs on this topic. So this chart plots net score or spending momentum on the vertical axis, and market share or pervasiveness in the dataset on the horizontal axis. And we inserted a table that shows the data points in detail. Now that red dotted line is just sort of Dave Vellante's subjective mark in the sand for elevated spending levels. And there are three other points here. One is Splunk as well off is two-year peak, as highlighted in the red, but Signal FX, which Splunk acquired, has made a big move northward this last quarter. As has Datadog. So Erik, what can you share with us on this hot, but increasingly crowded space? >> Yeah. I could talk about the space for a long time. As you know, I've gotten some flack over the last year and a half about, you know, kind of pointing out this trend, this negative trend in Splunk. So I do want to be the first one to say that this data set is rebounding. Splunk has been horrific in our data for going back almost two years now, straight downward trend. This is the first time we're seeing any increase, any positivity there. So I do want to be fair and state that because I've been accused of being a little too negative on Splunk in the past. But I would basically say for observability right now, it's a rising tide lifts all boats, if I can use a New England phrase. The data across the board in analytics for these observability players is up, is accelerating. None more so than Datadog. And it's exactly your point, David. The complexity, the increased cloud migration is a perfect setup for Datadog, which is a cloud native. It focuses on microservices. It focuses on cloud observability. Old Splunk was just application monitoring. Don't get me wrong, they're changing, but they were on-prem application monitoring, first and foremost. Datadog came out as cloud native. They, you know, do microservices. This is just a perfect setup for them. And not only is Datadog leading the observability, it's leading the entire analytics sector, all of it. Not just the observability niche. So without a doubt, that is the strongest that we're seeing. It's leading Dynatrace new Relic. The only one that really isn't rebounding is Cisco App Dynamics. That's getting the dreaded legacy word really attached to it. But this space is really on fire, elastic as well, really doing well in this space. New Relic has shown a little bit of improvement as well. And what I heard when I asked my panelists about this, is that because of the maturity of cloud migration, that this observability has to grow. Spending on this has to happen. So they all say the chart looks right. And it's really just about the digital transformation maturity. So that's largely what they think is happening here. And they don't really see it getting, you know, changing anytime soon. >> Yeah, and I would add, and you see that it's getting crowded. You saw a service now acquired LightStep, and they want to get into the game. You mentioned, you know, last deck of the elk stack is, you know, the open source alternative, but then we see a company who's raised a fair amount of money, startup, chaos search, coming in, going after kind of the complexity of the elk stack. You've got honeycomb, which has got a really innovative approach, Jeremy Burton's company observes. So you have venture capital coming in. So we'll see if those guys could be disruptive enough or are they, you know, candidates to get acquired? We'll see how that all- you know that well. The M and A space. You think this space is ripe for M and A? >> I think it's ripe for consolidation, M and A. Something has to shake out. There's no doubt. I do believe that all of these can be standalone. So we shall see what's happened to, you mentioned the Splunk acquisition of Signal FX, just a house cleaning point. That was really nice acceleration by Signal FX, but it was only 20 citations. We'd looked into this a little bit deeper. Our data scientists did. It appears as if the majority of people are just signaling spunk and not FX separately. So moving forward for our data set, we're going to combine those two, so we don't have those anomalies going forward. But that type of acquisition does show what we should expect to see more of in this group going forward. >> Well that's I want to mention. That's one of the challenges that any data company has, and you guys do a great job of it. You're constantly having to reevaluate. There's so much M and A going on in the industry. You've got to pick the right spots in terms of when to consolidate. There's some big, you know, Dell and EMC, for example. You know, you've beautifully worked through that transition. You're seeing, you know, open shift and red hat with IBM. You just got to be flexible. And that's where it's valuable to be able to have a pipeline to guys like Erik, to sort of squint through that. So thank you for that clarification. >> Thank you too, because having a resource like you with industry knowledge really helps us navigate some of those as well for everyone out there. So that's a lot to do with you do Dave, >> Thank you. It's going to be interesting to watch Splunk. Doug Merritt's made some, you know, management changes, not the least of which is bringing in Teresa Carlson to run go to market. So if you know, I'd be interested if they are hitting, bouncing off the bottom and rising up again. They have a great customer base. Okay. Let's look at some of the same dimensions. Go ahead. You got a comment? >> A few of ETR's clients looked at our data and then put a billion dollar investment into it too. So obviously I agree. (Dave laughing) Splunk is looking like it's set for a rebound, and it's definitely something to watch, I agree. >> Not to rat hole in this, but I got to say. When I look back, cause theCUBE gives us kind of early visibility. So companies with momentum and you talk to the customers that all these shows that we go to. I will tell you that three companies stood out last decade. It was Splunk. It was Service Now and Tableau. And you could tell just from just discussions with their customers, the enthusiasm in that customer base. And so that's a real asset, and that helps them build them a moat. So we'll see. All right, let's take a look at the same dimensions now for cyber. This is cybersecurity net score in the vertical, and market share in the horizontal. And I filtered by in greater than a hundred shared in because just gets so crowded. Erik, the only things I would point out here is CrowdStrike and Zscaler continue to shine, CyberArk also showing momentum over that 40% line. Very impressively, Palo Alto networks, which has a big presence in the market. They've bounced back. We predicted that a while back. Your round table suggested people like working with Palo Alto. They're a gold standard. You know, we had reported earlier on that divergence with four to net in terms of valuation and some of the challenges they had in cloud, clearly, you know, back with the momentum. And of course, Microsoft in the upper, right. It's just, they're literally off the charts and obviously a major player here, but your thoughts on cyber? >> Erik: Yeah. Going back to the backdrop. Security, security, security. It has been the number one priority going back to last September. No one sees it changing. It has to happen. The threat vectors are actually expanding and we have no choice but to spend here. So it is not surprising to see. You did name our three favorite names. So as you know, we look at the dataset, we see which ones have the most positive inflections, and we put outlooks on those. And you did mention Zscaler, Okta and CrowdStrike, by far the three standouts that we're seeing. I just recently did a huge panel on Okta talking about their acquisition of Auth Zero. They're pushed into Sale Point space, trying to move just from single sign on and MFA to going to really privileged account management. There is some hurdles there. Really Okta's ability to do this on-prem is something that a little bit of the IT end users are concerned about. But what we're seeing right now, both Okta and Auth Zero are two of the main adopted names in security. They look incredibly well set up. Zscaler as well. With the ZTNA push more towards zero trust, Zscaler came out so hot in their IPO. And everyone was wondering if it was going to trail off just like Snowflake. It's not trailing off. This thing just keeps going up into the right, up into the right. The data supports a lot of tremendous growth for the three names that you just mentioned. >> Yeah. Yeah. I'm glad you brought up Auth Zero. We had reported on that earlier. I just feel like that was a great acquisition. You had Okta doing the belly to belly enterprise, you know, selling. And the one thing that they really lacked was that developer momentum. And that's what Auth Zero brings. Just a smart move by Todd McKinnon and company. And I mean, so this, you know, I want to, I want to pull up another chart show a quick snapshot of some of the players in the survey who show momentum and have you comment on this. We haven't mentioned Snowflake so far, but they remain again with like this gold standard of net score, they've consistently had those high marks with regard to spending velocity. But here's some other data. Erik, how should we interpret this? >> Erik: Yeah, just to harp on Snowflake for a second. Right, I mean the rich get richer. They came out- IPO was so hyped, so it was hard for us as a research company to say, "Oh, you know, well, you know, we agree." But we did. The data is incredible. You can't beat the management team. You can't beat what they're doing. They've got so much cash. I can't wait to see what they do with it. And meanwhile, you would expect something that debuted with that high of a net score, that high of spending velocity to trail off. It would be natural. It's not Dave, it's still accelerating. It's gone even higher. It's at all time highs. And we just don't see it stopping anytime soon. It's a really interesting space right now. Maybe another name to look at on here that I think is pretty interesting, kind of a play on return to business is Kupa. It's a great project expense management tool that got hit really hard. Listen, traveling stopped, business expense stopped, and I did a panel on it. And a lot of our guys basically said, "Yeah, it was the first thing I cut." But we're seeing a huge rebound in spending there in that space. So that's a name that I think might be worth being called out on a positive side. Negative, If you look down to the bottom right of that chart, unfortunately we're seeing some issues in RingCentral and Zoom. Anything that's sort of playing in this next, you know, video conferencing, IP telephony space, they seem to be having really decelerating spending. Also now with Zoom's acquisition of five nine. I'm not really sure how RingCentral's going to compete on that. But yeah, that's one where we debuted for the first time with a negative outlook on that name. And looking and asking to some of the people in our community, a lot of them say externally, you still need IP telepany, but internally you don't. Because the You Cast communication systems are getting so sophisticated, that if I have Teams, if I have Slack, I don't need phones anymore. (chuckling) That you and I can just do a Slack call. We can do a Teams call. And many of them are saying I'm truly ripping out my IP Telepany internally as soon as possible because we just don't need it. So this whole collaboration, productivity space is here to stay. And it's got wide ranging implications to some of these more legacy type of tools. >> You know, one of the other things I'd call out on this chart is Accenture. You and I had a session earlier this year, and we had predicted that that skill shortage was going to lead to an uptick in traditional services. We've certainly seen that. I mean, IBM beat its quarter on the strength of services largely. And seeing Accenture on that is I think confirmation. >> Yeah that was our New Year prediction show, right Dave? When we made top 10 predictions? >> That's right. That was part of our predictions show. Exactly, good memory. >> The data is really showing that continue. People want the projects, they need to do the projects, but hiring is very difficult. So obviously the number one beneficiary there are going to be the Accentures of the world. >> All right. So let's do a quick wrap. I'm going to make a few comments and then have you bring us home, Erik. So we laid out our scenario for the tech spending rebound. We definitely believe last year tracked downward, along with GDP contraction. It was interesting. Gardner doesn't believe, at least factions of Gardner don't believe there's a correlation between GDP and tech spending. But, you know, I personally think there generally is some kind of relatively proportional pattern there. And I think we saw contraction last year. People are concerned about inflation. Of course, that adds some uncertainty. And as well, as you mentioned around the Delta variant. But I feel as though that the boards of directors and CEOs, they've mandated that tech execs have to build out digital platforms for the future. They're data centric. They're highly automated, to your earlier points. They're intelligent with AI infused, and that's going to take investment. I feel like the tech community has said, "Look, we know what to do here. We're dealing with hybrid work. We can't just stop doing what we're doing. Let's move forward." You know, and as you say, we're flying again and so forth. You know, getting hybrid right is a major priority that directly impacts strategies. Technology strategies, particularly around security, cloud, the productivity of remote workers with collaboration. And as we've said many times, we are entering a new era of data that's going to focus on decentralized data, building data products, and Erik let's keep an eye on this observability space. Lot of interest there, and buyers have a number of choices. You know, do they go with a specialist, as we saw recently, we've seen in the past, or did they go with the generalist like Service Now with the acquisition of LightStep? You know, it's going to be interesting. A lot of people are going to get into this space, start bundling into larger platforms. And so as you said, there's probably not enough room for all the players. We're going to see some consolidation there. But anyway, let me give you the final word here. >> Yeah, no, I completely agree with all of it. And I think your earlier points are spot on, that analytics and automation are certainly going to be moving more and more to that left of that chart we had of priorities. I think as we continue that survey heading into 2022, we'll have some fresh data for you again in a few months, that's going to start looking at 2022 priorities and overall spend. And the one other area that I keep hearing about over and over and over again is customer experience. There's a transition from good old CRM to CXM. Right now, everything is digital. It is not going away. So you need an omni-channel support to not only track your customer experience, but improve it. Make sure there's a two way communication. And it's a really interesting space. Salesforce is going to migrate into it. We've got Qualtrics out there. You've got Medallia. You've got FreshWorks, you've got Sprinkler. You got some names out there. And everyone I keep talking to on the IT end user side keeps bringing up customer experience. So let's keep an eye on that as well. >> That's a great point. And again, it brings me back to Service Now. We wrote a piece last week that's sort of, Service Now and Salesforce are on a collision course. We've said that for many, many years. And you've got this platform of platforms. They're just kind of sucking in different functions saying, "Hey, we're friends with everybody." But as you know Erik, software companies, they want to own it all. (both chuckling) All right. Hey Erik, thank you so much. I want to thank you for coming back on. It's always a pleasure to have you on Breaking Analysis. Great to see you. >> Love the partnership. Love the collaboration. Let's go enjoy this summer Friday. >> All right. Let's do. Okay, remember everybody, these episodes, they're all available as podcasts, wherever you listen. All you got to do is search Breaking Analysis Podcast, click subscribe to the series. Check out ETR's website at etr.plus. They've just launched a new website. They've got a whole new pricing model. It's great to see that innovation going on. Now remember we also publish a full report every week on WikiBond.com and SiliconAngle.com. You can always email me, appreciate the back channel comments, the metadata insights. David.Vellante@SiliconAngle.com. DM me on Twitter @DVellante or comment on the LinkedIn posts. This is Dave Vellante for Erik Bradley and theCUBE insights powered by ETR. Have a great week, a good rest of summer, be well. And we'll see you next time. (inspiring music)

Published Date : Aug 2 2021

SUMMARY :

bringing you data-driven And at the macro level, We've got some fresh data to talk about and based on the recent earnings results So as the year has So Erik, I'm going to let back half of the year. and the other sectors that you see there. and a little bit more on the and Erik, the rest of the metrics Another point to you about and the CIO's expect that to land on returned to the office. on the hybrid models, I need the support staff to be in office. but the shift to a more One of my analysts said to me, And that means if you is that because of the last deck of the elk stack It appears as if the majority of people going on in the industry. So that's a lot to do with you do Dave, It's going to be something to watch, I agree. and some of the challenges that a little bit of the IT And I mean, so this, you know, I want to, Erik: Yeah, just to harp You know, one of the That was part of our predictions So obviously the number and that's going to take investment. And the one other area I want to thank you for coming back on. Love the partnership. It's great to see that

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Breaking Analysis: Chasing Snowflake in Database Boomtown


 

(upbeat music) >> From theCUBE studios in Palo Alto, in Boston bringing you data-driven insights from theCUBE and ETR. This is braking analysis with Dave Vellante. >> Database is the heart of enterprise computing. The market is both exploding and it's evolving. The major force is transforming the space include Cloud and data, of course, but also new workloads, advanced memory and IO capabilities, new processor types, a massive push towards simplicity, new data sharing and governance models, and a spate of venture investment. Snowflake stands out as the gold standard for operational excellence and go to market execution. The company has attracted the attention of customers, investors, and competitors and everyone from entrenched players to upstarts once in the act. Hello everyone and welcome to this week's Wikibon CUBE Insights powered by ETR. In this breaking analysis, we'll share our most current thinking on the database marketplace and dig into Snowflake's execution. Some of its challenges and we'll take a look at how others are making moves to solve customer problems and try to get a piece of the growing database pie. Let's look at some of the factors that are driving market momentum. First, customers want lower license costs. They want simplicity. They want to avoid database sprawl. They want to run anywhere and manage new data types. These needs often are divergent and they pull vendors and technologies in different direction. It's really hard for any one platform to accommodate every customer need. The market is large and it's growing. Gardner has it at around 60 to 65 billion with a CAGR of somewhere around 20% over the next five years. But the market, as we know it is being redefined. Traditionally, databases have served two broad use cases, OLTP or transactions and reporting like data warehouses. But a diversity of workloads and new architectures and innovations have given rise to a number of new types of databases to accommodate all these diverse customer needs. Many billions have been spent over the last several years in venture money and it continues to pour in. Let me just give you some examples. Snowflake prior to its IPO, raised around 1.4 billion. Redis Labs has raised more than 1/2 billion dollars so far, Cockroach Labs, more than 350 million, Couchbase, 250 million, SingleStore formerly MemSQL, 238 million, Yellowbrick Data, 173 million. And if you stretch the definition of database a little bit to including low-code or no-code, Airtable has raised more than 600 million. And that's by no means a complete list. Now, why is all this investment happening? Well, in a large part, it's due to the TAM. The TAM is huge and it's growing and it's being redefined. Just how big is this market? Let's take a look at a chart that we've shown previously. We use this chart to Snowflakes TAM, and it focuses mainly on the analytics piece, but we'll use it here to really underscore the market potential. So the actual database TAM is larger than this, we think. Cloud and Cloud-native technologies have changed the way we think about databases. Virtually 100% of the database players that they're are in the market have pivoted to a Cloud first strategy. And many like Snowflake, they're pretty dogmatic and have a Cloud only strategy. Databases has historically been very difficult to manage, they're really sensitive to latency. So that means they require a lot of tuning. Cloud allows you to throw virtually infinite resources on demand and attack performance problems and scale very quickly, minimizing the complexity and tuning nuances. This idea, this layer of data as a service we think of it as a staple of digital transformation. Is this layer that's forming to support things like data sharing across ecosystems and the ability to build data products or data services. It's a fundamental value proposition of Snowflake and one of the most important aspects of its offering. Snowflake tracks a metric called edges, which are external connections in its data Cloud. And it claims that 15% of its total shared connections are edges and that's growing at 33% quarter on quarter. This notion of data sharing is changing the way people think about data. We use terms like data as an asset. This is the language of the 2010s. We don't share our assets with others, do we? No, we protect them, we secure or them, we even hide them. But we absolutely don't want to share those assets but we do want to share our data. I had a conversation recently with Forrester analyst, Michelle Goetz. And we both agreed we're going to scrub data as an asset from our phrasiology. Increasingly, people are looking at sharing as a way to create, as I said, data products or data services, which can be monetized. This is an underpinning of Zhamak Dehghani's concept of a data mesh, make data discoverable, shareable and securely governed so that we can build data products and data services that can be monetized. This is where the TAM just explodes and the market is redefining. And we think is in the hundreds of billions of dollars. Let's talk a little bit about the diversity of offerings in the marketplace. Again, databases used to be either transactional or analytic. The bottom lines and top lines. And this chart here describe those two but the types of databases, you can see the middle of mushrooms, just looking at this list, blockchain is of course a specialized type of database and it's also finding its way into other database platforms. Oracle is notable here. Document databases that support JSON and graph data stores that assist in visualizing data, inference from multiple different sources. That's is one of the ways in which adtech has taken off and been so effective. Key Value stores, log databases that are purpose-built, machine learning to enhance insights, spatial databases to help build the next generation of products, the next automobile, streaming databases to manage real time data flows and time series databases. We might've missed a few, let us know if you think we have, but this is a kind of pretty comprehensive list that is somewhat mind boggling when you think about it. And these unique requirements, they've spawned tons of innovation and companies. Here's a small subset on this logo slide. And this is by no means an exhaustive list, but you have these companies here which have been around forever like Oracle and IBM and Teradata and Microsoft, these are the kind of the tier one relational databases that have matured over the years. And they've got properties like atomicity, consistency, isolation, durability, what's known as ACID properties, ACID compliance. Some others that you may or may not be familiar with, Yellowbrick Data, we talked about them earlier. It's going after the best price, performance and analytics and optimizing to take advantage of both hybrid installations and the latest hardware innovations. SingleStore, as I said, formerly known as MemSQL is a very high end analytics and transaction database, supports mixed workloads, extremely high speeds. We're talking about trillions of rows per second that could be ingested in query. Couchbase with hybrid transactions and analytics, Redis Labs, open source, no SQL doing very well, as is Cockroach with distributed SQL, MariaDB with its managed MySQL, Mongo and document database has a lot of momentum, EDB, which supports open source Postgres. And if you stretch the definition a bit, Splunk, for log database, why not? ChaosSearch, really interesting startup that leaves data in S-3 and is going after simplifying the ELK stack, New Relic, they have a purpose-built database for application performance management and we probably could have even put Workday in the mix as it developed a specialized database for its apps. Of course, we can't forget about SAP with how not trying to pry customers off of Oracle. And then the big three Cloud players, AWS, Microsoft and Google with extremely large portfolios of database offerings. The spectrum of products in this space is very wide, with you've got AWS, which I think we're up to like 16 database offerings, all the way to Oracle, which has like one database to do everything not withstanding MySQL because it owns MySQL got that through the Sun Acquisition. And it recently, it made some innovations there around the heat wave announcement. But essentially Oracle is investing to make its database, Oracle database run any workload. While AWS takes the approach of the right tool for the right job and really focuses on the primitives for each database. A lot of ways to skin a cat in this enormous and strategic market. So let's take a look at the spending data for the names that make it into the ETR survey. Not everybody we just mentioned will be represented because they may not have quite the market presence of the ends in the survey, but ETR that capture a pretty nice mix of players. So this chart here, it's one of the favorite views that we like to share quite often. It shows the database players across the 1500 respondents in the ETR survey this past quarter and it measures their net score. That's spending momentum and is shown on the vertical axis and market share, which is the pervasiveness in the data set is on the horizontal axis. The Snowflake is notable because it's been hovering around 80% net score since the survey started picking them up. Anything above 40%, that red line there, is considered by us to be elevated. Microsoft and AWS, they also stand out because they have both market presence and they have spending velocity with their platforms. Oracle is very large but it doesn't have the spending momentum in the survey because nearly 30% of Oracle installations are spending less, whereas only 22% are spending more. Now as a caution, this survey doesn't measure dollar spent and Oracle will be skewed toward the big customers with big budgets. So you got to consider that caveat when evaluating this data. IBM is in a similar position although its market share is not keeping up with Oracle's. Google, they've got great tech especially with BigQuery and it has elevated momentum. So not a bad spot to be in although I'm sure it would like to be closer to AWS and Microsoft on the horizontal axis, so it's got some work to do there. And some of the others we mentioned earlier, like MemSQL, Couchbase. As shown MemSQL here, they're now SingleStore. Couchbase, Reddis, Mongo, MariaDB, all very solid scores on the vertical axis. Cloudera just announced that it was selling to private equity and that will hopefully give it some time to invest in this platform and get off the quarterly shot clock. MapR was acquired by HPE and it's part of HPE's Ezmeral platform, their data platform which doesn't yet have the market presence in the survey. Now, something that is interesting in looking at in Snowflakes earnings last quarter, is this laser focused on large customers. This is a hallmark of Frank Slootman and Mike Scarpelli who I know they don't have a playbook but they certainly know how to go whale hunting. So this chart isolates the data that we just showed you to the global 1000. Note that both AWS and Snowflake go up higher on the X-axis meaning large customers are spending at a faster rate for these two companies. The previous chart had an end of 161 for Snowflake, and a 77% net score. This chart shows the global 1000, in the end there for Snowflake is 48 accounts and the net score jumps to 85%. We're not going to show it here but when you isolate the ETR data, nice you can just cut it, when you isolate it on the fortune 1000, the end for Snowflake goes to 59 accounts in the data set and Snowflake jumps another 100 basis points in net score. When you cut the data by the fortune 500, the Snowflake N goes to 40 accounts and the net score jumps another 200 basis points to 88%. And when you isolate on the fortune 100 accounts is only 18 there but it's still 18, their net score jumps to 89%, almost 90%. So it's very strong confirmation that there's a proportional relationship between larger accounts and spending momentum in the ETR data set. So Snowflakes large account strategy appears to be working. And because we think Snowflake is sticky, this probably is a good sign for the future. Now we've been talking about net score, it's a key measure in the ETR data set, so we'd like to just quickly remind you what that is and use Snowflake as an example. This wheel chart shows the components of net score, that lime green is new adoptions. 29% of the customers in the ETR dataset that are new to Snowflake. That's pretty impressive. 50% of the customers are spending more, that's the forest green, 20% are flat, that's the gray, and only 1%, the pink, are spending less. And 0% zero or replacing Snowflake, no defections. What you do here to get net scores, you subtract the red from the green and you get a net score of 78%. Which is pretty sick and has been sick as in good sick and has been steady for many, many quarters. So that's how the net score methodology works. And remember, it typically takes Snowflake customers many months like six to nine months to start consuming it's services at the contracted rate. So those 29% new adoptions, they're not going to kick into high gear until next year, so that bodes well for future revenue. Now, it's worth taking a quick snapshot at Snowflakes most recent quarter, there's plenty of stuff out there that you can you can google and get a summary but let's just do a quick rundown. The company's product revenue run rate is now at 856 million they'll surpass $1 billion on a run rate basis this year. The growth is off the charts very high net revenue retention. We've explained that before with Snowflakes consumption pricing model, they have to account for retention differently than what a SaaS company. Snowflake added 27 net new $1 million accounts in the quarter and claims to have more than a hundred now. It also is just getting its act together overseas. Slootman says he's personally going to spend more time in Europe, given his belief, that the market is huge and they can disrupt it and of course he's from the continent. He was born there and lived there and gross margins expanded, do in a large part to renegotiation of its Cloud costs. Welcome back to that in a moment. Snowflake it's also moving from a product led growth company to one that's more focused on core industries. Interestingly media and entertainment is one of the largest along with financial services and it's several others. To me, this is really interesting because Disney's example that Snowflake often puts in front of its customers as a reference. And it seems to me to be a perfect example of using data and analytics to both target customers and also build so-called data products through data sharing. Snowflake has to grow its ecosystem to live up to its lofty expectations and indications are that large SIS are leaning in big time. Deloitte cross the $100 million in deal flow in the quarter. And the balance sheet's looking good. Thank you very much with $5 billion in cash. The snarks are going to focus on the losses, but this is all about growth. This is a growth story. It's about customer acquisition, it's about adoption, it's about loyalty and it's about lifetime value. Now, as I said at the IPO, and I always say this to young people, don't buy a stock at the IPO. There's probably almost always going to be better buying opportunities ahead. I'm not always right about that, but I often am. Here's a chart of Snowflake's performance since IPO. And I have to say, it's held up pretty well. It's trading above its first day close and as predicted there were better opportunities than day one but if you have to make a call from here. I mean, don't take my stock advice, do your research. Snowflake they're priced to perfection. So any disappointment is going to be met with selling. You saw that the day after they beat their earnings last quarter because their guidance in revenue growth,. Wasn't in the triple digits, it sort of moderated down to the 80% range. And they pointed, they pointed to a new storage compression feature that will lower customer costs and consequently, it's going to lower their revenue. I swear, I think that that before earnings calls, Scarpelli sits back he's okay, what kind of creative way can I introduce the dampen enthusiasm for the guidance. Now I'm not saying lower storage costs will translate into lower revenue for a period of time. But look at dropping storage prices, customers are always going to buy more, that's the way the storage market works. And stuff like did allude to that in all fairness. Let me introduce something that people in Silicon Valley are talking about, and that is the Cloud paradox for SaaS companies. And what is that? I was a clubhouse room with Martin Casado of Andreessen when I first heard about this. He wrote an article with Sarah Wang, calling it to question the merits of SaaS companies sticking with Cloud at scale. Now the basic premise is that for startups in early stages of growth, the Cloud is a no brainer for SaaS companies, but at scale, the cost of Cloud, the Cloud bill approaches 50% of the cost of revenue, it becomes an albatross that stifles operating leverage. Their conclusion ended up saying that as much as perhaps as much as the back of the napkin, they admitted that, but perhaps as much as 1/2 a trillion dollars in market cap is being vacuumed away by the hyperscalers that could go to the SaaS providers as cost savings from repatriation. And that Cloud repatriation is an inevitable path for large SaaS companies at scale. I was particularly interested in this as I had recently put on a post on the Cloud repatriation myth. I think in this instance, there's some merit to their conclusions. But I don't think it necessarily bleeds into traditional enterprise settings. But for SaaS companies, maybe service now has it right running their own data centers or maybe a hybrid approach to hedge bets and save money down the road is prudent. What caught my attention in reading through some of the Snowflake docs, like the S-1 in its most recent 10-K were comments regarding long-term purchase commitments and non-cancelable contracts with Cloud companies. And the companies S-1, for example, there was disclosure of $247 million in purchase commitments over a five plus year period. And the company's latest 10-K report, that same line item jumped to 1.8 billion. Now Snowflake is clearly managing these costs as it alluded to when its earnings call. But one has to wonder, at some point, will Snowflake follow the example of say Dropbox which Andreessen used in his blog and start managing its own IT? Or will it stick with the Cloud and negotiate hard? Snowflake certainly has the leverage. It has to be one of Amazon's best partners and customers even though it competes aggressively with Redshift but on the earnings call, CFO Scarpelli said, that Snowflake was working on a new chip technology to dramatically increase performance. What the heck does that mean? Is this Snowflake is not becoming a hardware company? So I going to have to dig into that a little bit and find out what that it means. I'm guessing, it means that it's taking advantage of ARM-based processes like graviton, which many ISVs ar allowing their software to run on that lower cost platform. Or maybe there's some deep dark in the weeds secret going on inside Snowflake, but I doubt it. We're going to leave all that for there for now and keep following this trend. So it's clear just in summary that Snowflake they're the pace setter in this new exciting world of data but there's plenty of room for others. And they still have a lot to prove. For instance, one customer in ETR, CTO round table express skepticism that Snowflake will live up to its hype because its success is going to lead to more competition from well-established established players. This is a common theme you hear it all the time. It's pretty easy to reach that conclusion. But my guess is this the exact type of narrative that fuels Slootman and sucked him back into this game of Thrones. That's it for now, everybody. Remember, these episodes they're all available as podcasts, wherever you listen. All you got to do is search braking analysis podcast and please subscribe to series. Check out ETR his website at etr.plus. We also publish a full report every week on wikinbon.com and siliconangle.com. You can get in touch with me, Email is David.vellante@siliconangle.com. You can DM me at DVelante on Twitter or comment on our LinkedIn posts. This is Dave Vellante for theCUBE Insights powered by ETR. Have a great week everybody, be well and we'll see you next time. (upbeat music)

Published Date : Jun 5 2021

SUMMARY :

This is braking analysis and the net score jumps to 85%.

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Breaking Analysis: Tech Spend Momentum but Mixed Rotation to the ‘Norm’


 

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

Published Date : Apr 23 2021

SUMMARY :

This is "Breaking Analysis" out the ideal balance Always good to see you and and also the latest April data. and really, that spending is going to be that we want to show you and that's from the IT that number, by the way, So that is still the clear direction, and the red is the portion is that the inverse analysis and the company beat earnings, One of the reasons we don't is that in the one hand, is that 30% of the respondents said a bath in the ETR data and the vendors out there themselves and the Cloud is extending and that also bodes well and the yellow line is and say that the song hearing in all the insights in the dataset that also have Splunk but the one thing I got to and the yellow is April 21, and it's sort of that perfect storm and then as you mentioned, and a blurring of the lines and some of the names that and the reason why is Here's the data on Pure and the other thing that and some of the competitive. is that we are capturing Organizations that sit at the and that's for the private names. and so really appreciate the collaboration and looking forward to doing and please subscribe to the series.

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Breaking Analysis: APM - From Tribal Knowledge to Digital Dashboard


 

>> From theCUBE Studios in Palo Alto in Boston, bringing you data-driven insights from theCUBE and ETR, this is Breaking Analysis with Dave Vellante. >> Application performance management AKA APM, you know it's been around since the days of the mainframe. Now, as systems' architectures became more complex, the technology evolved to accommodate client-server, web-tier architectures, mobile and now of course, cloud-based systems. A spate of vendors have emerged to solve the sticky problems associated with ensuring consistent and predictable user experiences. The market has grown, I mean it's decent size, it's about $5 billion globally. It's growing at a consistent 10% CAGR. It's got a variety of established companies and new entrants that are attacking this space. Hi everyone, welcome to this week's Wikibon Cube Insights powered by ETR. My name is Dave Vellante and today, we welcome back ETR's Erik Bradley, who was the chief engagement strategist at Aptiviti which is the holding company of our data partner, ETR. Erik, my friend, great to see you. Thanks so much for coming on and spending some time with us. >> Oh, always enjoy it Dave. Great to see you too and I'm just glad I got some fresh material for ya. >> As always, you have fresh data. Now, Erik just recently hosted an ETR VENN session and on this particular topic, APM. Now VENNs are an open round table, they're exclusively available to ETR's clients and what we do is we sometimes come in theCUBE and we summarize those sessions in our Breaking Analysis. Now Erik, yo let's start with a summary slide here, guys, if you could bring that up, we just want to make a couple of points and... So as I said Erik, I mean this started back, you know in the System/390 days. Now, distributed systems and cloud of course create a lot more complexity, you got data that's really fragmented. You got user data, you got application data, you have infrastructure data and it gets complicated and you've got guys in lab coats having to come in and diagnose these stuff, lot of tribal knowledge. What are you seeing in the space? >> Well yeah, you know to start back, you know it's funny when the panel I hosted, one of the guys even brought up Tivoli, how long ago that was right? Then of course you get, you know you have the solar winds and you had people like that trying to just kind of monitor your network. You know what we've heard a lot about now is infrastructure has really become code-based. So when that happens, you really start wondering to yourself the lines are blurring between infrastructure and application because at the end of the day, what you're really monitoring is code. So it has gotten incredibly complex, you have OnPrem, you have hybrid, you have multi-cloud approach so it has gotten extremely complex and there's also now a third wave of next-gen vendors getting involved in the mix as well. As you're aware, New Relic and Datadog, obviously, Splunk has been in logging and monitoring for a long time. You also had some of the traditional players throw their hat in the ring through acquisition, that you know AppDynamics gobbled up by Cisco and obviously Splunk trying to continue to reinvent themselves a little bit by SignalFx. So it is a very crowded, complex space, it is a complicated problem but it's also a problem that needs to be solved. You know, we were looking at, you said in your intro about, it's only about a $5 billion market right now but there's been a lot of data out there from industry analysts saying that that's going to grow quite handsomely over the next five years and it could get up to 13, 14, 15 billion. And when I asked my panel about that, I had one gentleman say without a doubt, they see the next 10 years that spending in this space will continue. And when you pry and ask why, they simply state that digital transformation is not going to stop, it's marching forward, whether anyone likes it or not and as it does, monitoring is going to be critical, it's only going to increase and increase and increase. So right now, to your point, it's a small market but it's a growing market and there's a lot of entrance in there and their whole goal is to reduce this complexity that you're talking about. >> Now, one of the things we heard from the panel, guys if you bring up that same slide again, you know the third point on that slide was what's closely tied to digital transformation. You heard a number of individuals say, "Look, your digital business is critical, it's all about monitoring your applications and your data and your infrastructure. And we heard a lot that they wanted a, a single pane of glass and you made a number of points about the market. What are your thoughts on both the digital transformation, maybe the COVID acceleration of that mandate and that notion of a single pane of glass, is that aspirational or is it, in your view, something that is actually technically feasible? >> Not only is it technically feasible, it has to happen. It's going to be demanded by the large enterprise, they can't continue to monitor hundreds and hundreds of applications. They need something that not only can give them observability through their entire stack, but they need to be able to view it in one way, there's enough fatigue in monitoring and logging. And actually it goes even further than one pane of glass, they're demanding that these systems can now actually employ machine learning algorithms to be proactive. It's not enough to just say, "Okay, I observed this," you have to let me know that this may happen in the future and what to do about it. So not only is it feasible, it's something that is being demanded by the end-user market and the players that survive are the ones that already have that in their roadmap. >> Now, as we always like to do in these sessions, we're going to bring up some ETR data and we like to position the companies. So what we do is, we're going to bring up some of the pure players, pure-play companies and you can see them on this slide. But Erik, and when we talk about companies in this space, they are well over a dozen. It's just again for reference, you know it's Cisco with AppD, you mentioned that before Dynatrace is one of the leaders, New Relic has been around for awhile and is doing well, Splunk, Datadog. Now of course, and we're not showing them here, AWS, Microsoft and Google cause they just sort of, they pollute the chart. But so I want to start with the guys that are on this view and maybe talk about a few. Elastic came up a lot, certainly AppD came up a little, Dynatrace was obviously mentioned, especially in large organizations. Lot of conversations about New Relic. So let's go through them. Where do you want to start here? >> Yeah there's a lot to go through and we did spend the majority of the panel talking about the individual players, the differences between them and also what we thought their longer term prospects were but yeah, we'll go through each one. I think maybe to start with, let's go back in time a little bit, right? Cisco is a wonderful acquirer, they do a great job at M&A. A lot of companies will acquire something and let it die on the vine. Cisco has proven recently that they are reinventing themselves as a full platform play, whether that be through, you know, kind of, their networking reach or whether it be through the security. And AppDynamics is one of those that actually kind of gives you a little bit of both with being able to monitor. It is a great play for people that are already involved with Cisco. Now, I don't think you're going to see too many people that are non-Cisco customers run out and buy it. There you're going to see some of them, maybe the pure plays or one of my guests called the third wave of vendors. And that third wave is really about a Datadog and a New Relic. Let's talk about Datadog first. >> Yeah let's bring that back up guys, if you would. Now let me just, sorry to interrupt you Erik (indistinct) The vertical axis here is net score, that's the ETR's primary metric, and that's an indication of spending velocity, the higher, the better. And on the horizontal axis is market share. Now we're showing the July data, the October data is in the field, you know once ETR releases that to its clients, then we'll share that with you. But the first thing that jumps out at me is other than Elastic Erik, I mean, I'm not blown away by the spending momentum in this space but let's talk about that and then some of your thoughts on the specific vendors. >> Yeah, you know I'll go back because you asked a little bit about the digital transformation, I don't think I answered it fully. So to your comment about maybe not being impressed with the spend, I think this is one where the spend is going to come, kind of as a laggard because you're not going to rush out and go buy the software to monitor until you've built out the, what needs to be monitored. So as we're seeing this increase in the digital transformation, and I think you and I had a conversation in the past, but when COVID first hit and I did a series of panels, we had one person say that this virus is going to increase digital transformation by five to 10 years. Now that was an amazing statement. Basically, if you were on the fence, if you didn't, if you weren't already heading down to digital transformation, you needed to play catch up quickly. So now that you are doing that right, now that you're moving from OnPrem to a multicloud or a hybrid cloud environment, you have to get observability, you have to get monitoring into it. So now these players start to play catch up and this is where you're going to see the proof of concepts and you're going to see people trying to decide which direction they're going to take their company. Now back to the actual vendors. I believe that there is some differentiation, right? So we'll just take, for instance, Splunk. Splunk is obviously probably the biggest boy on the block when it comes to just straight up logging and monitoring. They've leveraged that big boy position to really, you know, add some costs, kind of intimidate their customers they've been compared in the past of the type of things that Oracle used to do from their cost perspective. And that's opened up some new competition, Datadog is one of those. According to my panel, Datadog is viewed more for logging and monitoring than it is truly full end-to-end observability throughout your entire network and application system. So that is one of the areas that's there. Now, to stay on those two names for a quick second, Splunk obviously has some holes in what they're trying to offer, they went out and tried to buy SignalFx to fill one of those holes. Now according to my panel again, did a great job filling that hole, problem is if you have a boat with three holes, you can't put your fingers everywhere. So they think, hey listen, Splunk scrape, they're going to keep the company they have and I know that we can talk a little bit more about valuations and the equity side later, but I think it's very clear that their sales and revenue are trending flat to down, whereas some of these other names still have great acceleration in their sales. So Splunk and Datadog both are really facing pressure from Elastic or generally just open-source. >> I was struck by the panel and how much emphasis they, how much complaining they did about Splunk pricing. Generally, I feel like hey, if your price is too high is the biggest objection, that's actually not a bad thing for a company but the way they kept hitting on it and said, "Hey, we're actively looking for alternatives" and Datadog was one of those and given the momentum that Datadog has, I don't think that that's necessarily a positive. But you know Splunk has a lot of loyal customers but you know to your point if you go back to the slide, Elastic came up very, very strong and they are head and shoulders from a spending momentum above the rest of the crowd here. >> Right. And you know, so you're right. If the only problem with a vendor or a technology is cost, usually you live with it because that means it's giving you what you need. So okay, it's expensive but it's also the best in breed and that's where Splunk has been for a very long time. And I think they're resting on their laurels knowing that. Enter Elastic and you say to these guys, the panel, I asked them, well okay, you can make Elastic work but is it truly a viable alternative from a technology standpoint? And the answer to that was not only is it viable, it's half the price. So if you can bring something in that can do the job the same and it's half the cost, it's really difficult not to at least try. And I had one of the other gentlemen who was a Datadog customer said, "Listen, we love Datadog, we were a huge customer and then I started getting enormous bills and I just switched over to open-source, I switched to Elastic, I switched to Kibana, I switched to Kafka and I can do this search myself. Now the difference is not every enterprise has the human skillset to do so and I'm not saying Splunk's going to turn around to disappear tomorrow, not even close. Because there is a difference in spending that money with the vendor or spending that money developing the human skillset to use open-source. But the bigger backdrop here is there are more alternatives than there used to be, there's more competition and the space is getting very crowded. >> Yeah, comment on open-source. I mean open-source is free like a puppy. But the thing about that, and we had one of the panelists was a very senior consultant, exclusively work with very large companies, he told a story about one of the companies years ago, he came in to solve a problem. The problem was they had 70% availability and then they had no visibility on their infrastructure and there's really no great, no good monitor, they get them up to whatever, five nines or two, three nines or wherever they got them to, but dramatic improvement. And so, but he said, "Look it, I work with companies with billions of dollars, $3 billion IT budgets so they don't rely on open-source for this stuff, they're happy to spend." But there's a huge market, particularly in the mid size where we heard that New Relic plays in a big way, it might be more receptive to open-source. >> Couple of great points there Dave, honestly. I'm going to jump over to the use case that was given by that person who was in a healthcare role. And essentially the part I didn't write into my summary was that his CEO was two days away from shutting down the entire business because he was so frustrated that he had no observability and Dynatrace was the one that was able to step in and fix that. And this gentleman did say that the majority of the companies that he does work with which are all in the Fortune 100, Dynatrace has a stranglehold in that spot. So that's really interesting to note. Now on the flip side, when pushed a little bit more later in the panel, he said, "Dynatrace is sort of resting on its laurels from a product roadmap standpoint and that's going to open up the possibility of a New Relic getting in," a transition to New Relic as you mentioned on their small to medium sized business. They recently launched a new pricing strategy which is basically a free version to get you involved to kind of get their hooks into you and see if you can work it out. And basically what they're trying to do there I think is, you know, make up for their lack of marketing. As you saw the panel that we spoke about said, "New Relic's technology is fantastic." They have the ability to provide a single pane of glass which is the Holy Grail in this space and they have the ability to provide machine learning and proactive type of ability which again are the two things that all of the end-users are asking for. The problem is that most people might not be aware of it because New Relic doesn't have as flashy a marketing department, they don't have the dollars as much as the others to go out there and compete with the Splunk and Dynatrace and Cisco. But from a roadmap perspective, it was almost unanimous that our panel agreed, New Relic is by far, one of the leaders from a functionality standpoint. >> Yeah, if you guys bring that slide up one more time, the X Y. I mean, I look at where New Relic is and I'm like wow, I'm surprised. I mean this company, I mean they were the hot company for awhile and I think still have the capability. You're talking about the technology. NRDB, New Relic database is like, it kicks ass. In fact, you know Erik, somebody brought up in the panel that they thought that snowflake could compete in this market because essentially Snowflake's positioning is this data cloud. But you know, here's New Relic, they have a purpose-built database specifically for monitoring an APM so you would think that with that technology, they could really make some moves. And then I just want to bring in two other companies to the mix here. Honeycomb who I think even their founder and former CEO now CTO, she coined the term I believe, observability. And there's another company that is run by Jeremy Burton, company's called Observe, okay (indistinct) and it's funded by the Silicon Valley Mafia. So that's going to be an interesting one to watch, they're coming out, well they're out of stealth but they're doing a launch on October 7th. So I think those are two companies that could disrupt this space and I would expect to see, as you said, it's a latent momentum in net score from a dataset standpoint because people are trying to plug the holes cause of COVID, you know security, work from home, that pivot and now it's really on to digital transformation and that's where APM really comes in. >> It really does and again, it comes back to that comment someone made a long time ago that everything's becoming code as software eats the world and everything becomes code, you need the ability to kind of monitor that code, enter Honeycomb. And as you know, we have two different studies at ETR, one of them is for emerging technology. Honeycomb is in our emerging technology study that's more of a private series B to series E round stage whereas our main study is for companies that are pre IPO or already public. But Honeycomb is a little bit different in my opinion, that they're focused very much so on the developers or the software engineers. They're a very microservices oriented type of product whereas some of the other ones may have started as an infrastructure monitoring and then kind of work their way backward into application. But Honeycomb certainly needs to be observed and it's funny when you talk about that, the one thing I think is, "Oh great, more players." The crowded space gets even more crowded. And I think well you know, kind of foreshadowing something you and I will be speaking about in a little bit but there's a lot of players in this space and there's a lot of other possible interest in there. You mentioned Snowflake. It actually wasn't brought up from our panelists, it was a question that came from one of my clients that said, "Hey, I'm curious, can snowflake play in this space?" And the panel thought about it for a second and said, "There's absolutely no reason why they can't, they most certainly can." And we all know the cash they have so I mean the easiest way to play in that would maybe be to buy some of the technology, integrate it in and yeah, they have that portability. And if I can real quickly, they've just, one of the things that came out that was so important about this, we haven't spoken about the vendors is, is the public cloud. The public cloud offers this. They offer monitoring, they'll give it to you for free. If I'm going to run Kubernetes at Google, I'm going to get the monitoring for free which is super nice, right? But if I have an enterprise that has multicloud or hybrid cloud, and I'm working outside of that public cloud silo, it doesn't work. This is the exact conversation you and I had about Snowflake. AWS Redshift's fantastic but it doesn't work outside of AWS. So if every one of our enterprises continues on the digital transformation, they need portability. They have to be able to go across any architecture structure and that's why these independent providers are really starting to gain steam when you would think they could never compete with the public cloud. >> Yeah man, that's a great point. And we've talked about this in the context of Snowflake that who are you going to trust with your multi-cloud strategy? Are you going to trust AWS? Are you going to trust Google? Yeah, okay, they got Anthos but we kind of know why they're taking that posture. Microsoft, look, I'm probably going to partner with somebody who can, who's maybe I have a relationship with them with my OnPrem and that is really sort of agnostic to the various clouds so I'm glad you brought that up. And you know the point you're making about Honeycomb is a good one and I'll add that, again, it gets more complex with microservices and containers, that's spinning them up, spinning them down. Sometimes these, first of all, these microservices, sometimes aren't that micro and second of all, you're sometimes talking about hundreds of thousands of containers so it's a really increasingly complex environment. All right. What I want to do is-- >> You didn't even touch on serverless, we'll do that some other day. >> Oh, yeah, I mean absolutely. A hundred percent, right. So, now let's take a look at some of the valuations, guys if you bring that up for me. So I put this little chart together and it's always instructive. Now I like to, simple guy Erik so I like to... So you see, the company, I take a trailing 12-month revenue and then the market cap as of 9/25. And then just a simple revenue multiple, just to get a sense, it's not a hardcore valuation model but it's interesting and there usually is a correlation to the growth rate, I just pulled that off the latest quarterly growth rate. I mean, look at Datadog. I mean that's like Snowflake pre IPO valuations. I mean you're really, right around there with smaller revenue, smaller growth rate, Snowflakes up in the whatever 120% range but well eye-popping. You know the same valuation as Splunk, I mean that's just amazing. What do you make of this data? >> Well, you know I was an equity analyst for almost 15 years on the Wall Street side. So the, my first caveat is a trailing revenue to the multiple is not always the same because people are looking at what the forward expected revenue will be but I actually do see the correlation here. And when you brought this up, my eyes popped open. I do not understand why Datadog has a 27 billion market cap on a trailing 350 million in revenue. I just don't know if their forward looking growth really warrants that and at the same time, then you look at a Splunk, right? I mean they have two and a half billion in revenue but their growth rate's down and truthfully, when I see a -5% growth rate, I don't know why you weren't at 12% sales either. I would argue that there's quite a few names on here that could be in for a reckoning, ETR actually as far back as a year ago caught this in our data and said, "Hey, there's some inflection points here and I think investors need to pay attention to them." And since we came out with the July report, a lot of these names we're talking about, despite insane valuations in the equity markets are flat to down. And, you know I do think that, hey if they stay stagnant and their technology is right but it's a crowded space, I think we're really leading to the point where as one of my panelists said, this industry is ripe for consolidation. These players are not all going to be here in 12 months, it's that simple. >> Yeah and by the way, thank you for mentioning that as a former equity analyst, you were right (indistinct) 12 months, it's kind of the rear-view mirror. But I'll tell you, two reasons why I do that. One is, I put the growth rate in there so you can pick your own growth rate and your own forward revenue. The other is it's really easy for me to get TTM off a Yahoo as opposed to >> Right exactly. >> And so truth be told. But, guys bring that back up one more time cause I want to make a point about New Relic. I mean I think they are potentially right for an M&A because they got great technology. Now remember Elliot Management is in there and when Elliot's is in there, stuff's going to happen. They're going to start cleaning house, they're going to really create changes, they don't just get in in a big way and sit back and watch, they are extremely active. And the New Relic, leader in this space, great technology, great heritage. So either they got to clean up and get that valuation back up maybe as you pointed out, little bit better marketing posture, et cetera or they get taken out. >> Yeah and let's think about the two things that coincide, right? You have one of the world's best activist funds get involved in Elliot Management. And as you said, they don't get involved to just sort of watch or observe as we're talking about here today, they are very active in trying to get some sort of a, you know, corporate action done. And at the same time, all of a sudden New Relic comes out with a new pricing model. They're trying to create a moat around the small to medium business, right? They're trying to grow their footprint. Now the great thing about getting involved in small to medium businesses, it starts off for free but you grow with them. So I don't think those two are a coincidence, let me just put it that way. I think that they're coming in, they're trying to entrench themselves in a new market and set themselves up for future growth and I truly believe that based on the product roadmap and the feedback we were getting from the end-users in my panel, New Relic has the ability to look across all architecture, it has the ability to provide a single pane of glass and it has the ability to incorporate machine learning for proactive response. Their roadmap is fantastic, they have an active manager inside as an investor, I don't think they're going to be around for much, much longer. And obviously that you look around and you wonder who the acquirers will be and it might be one of the major cloud players. >> Yeah that would be interesting. I mean it gives them a play in a multicloud world and either they're going to just use that for their own advantage or they will actually see that as an opportunity, we'll be itching to watch. Alright, anything we didn't cover that you want to touch on or give us your final thoughts, please Erik. >> You know I would also just sort of mention a little bit about Splunk. This is a company that has a tremendous amount of revenue, a tremendous installed customer base but many, many times we've seen it before and Oracle is the greatest example. They kind of forget about their customers and they don't treat them properly. And I can't tell you how many people I have mentioned to me said, "Hey when this all went down in the viral pandemic and I went to Splunk and I asked for a little bit of pricing flexibility, I asked for this, I asked for that and they just wouldn't give it to me." And I wrote an article once called (indistinct) never forget similar to an elephant. And when they come out the other side, they're going to find a way to replace them. And today I also wrote an article that it was our 200th interview and I entitled it, The Splunk Funk. And basically it's about all the alternatives that are now out there, not just open source, but other vendors, even the vulnerability management players like a Rapid7, like a Tenable are getting into this space now. Fortinet, which one guy called "Fortaeverything" is a company that's really expanding. So I would just really kind of caution some of those vendors out there that don't rest on your laurels, don't take your customers for granted because sooner or later, they're going to be in a position to bite the back. >> Well I'll say this about Splunk, I've been following the company since the early part of last decade and I've done a lot of Cube interviews at their shows. They do have a passionate, passionate customer base, they got the experts that run around with that crazy hat and I've seen Splunk killers emerge for the last decade and so... But I think your point is right. I mean they've, the SignalFx acquisition was something that, it was a hole to fill and it gets them into a subscription-based model, they're going through that transition now. But I think they have some real gravity with their customer base. So, all right, let me summarize. For years, the application monitoring and management, it's really relied on alerts, logs, traces and even what I call tribal knowledge. In that world of pre-distributed systems, that was fine, like I said a trace can tell you what was going on. But things have begotten much more complicated architecturally with cloud and mobile and they're really changing fast now. Erik mentioned serverless, we talked about containers. So, today it's much harder to understand the customer experience because it's difficult to get a full picture of the data. And what I mean by that is that the user data, the application data, the infrastructure data, they're all fragmented and the Holy Grail solution really takes all this disparate data, it ingests it, it transforms it. Connects the dots if you will, across clouds, Onprem and then it shapes it, brings in machine intelligence, really creating an organic systems view that can proactively tell you that there's a problem coming. And finally, nearly absolute Nirvana is doing this in a way that non-technical people are going to be able to understand the true user experience. You know in theory, this is going to allow organizations to remediate in 110th the time with much, much lower costs and that's going to be critical in this world of digital transformation. So thank you Erik, really appreciate you coming on today. >> Always enjoy it Dave, it's always great talking to you and hopefully we'll do it again soon. >> All right, I can't wait. And thank you everybody for watching this episode of theCUBE Insights powered by ETR. Remember these episodes, they're all available on podcasts. We publish weekly on wikibon.com and siliconangle.com so you got to check that out. And don't forget, go to etr.plus for all the survey action. Would appreciate if you kindly comment on my LinkedIn post or tweet me @dvellante or email at david.vellante@siliconangle.com This is Dave Vellante. Thanks so much to Erik Bradley, be well and we'll see you next time. (bouncy music)

Published Date : Sep 25 2020

SUMMARY :

bringing you data-driven the technology evolved to Great to see you too and on this particular topic, APM. and you had people like that trying and that notion of a single pane of glass, and the players that survive are the ones Dynatrace is one of the leaders, and let it die on the vine. that to its clients, and go buy the software to monitor and given the momentum that Datadog has, And the answer to that for this stuff, they're happy to spend." They have the ability to and it's funded by the give it to you for free. and that is really sort of You didn't even touch on serverless, I just pulled that off the I don't know why you Yeah and by the way, So either they got to clean up and it has the ability to and either they're going to just use that and Oracle is the greatest example. and that's going to be critical always great talking to you and we'll see you next time.

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