(bright upbeat melody) >> Hello everyone, welcome back to Supercloud2. I'm John Furrier, my co-host Dave Vellante, here at theCUBE in Palo Alto, California, for our live stage performance all day for Supercloud2. Unpacking this next generation movement in cloud computing. Dave, Supercloud1 was in August. We had great response and acceleration of that momentum. We had some haters too. We had some folks out there throwing shade on this. But at the same time, a lot of leaders came out of the woodwork, a lot of practitioners. And this Supercloud2 event I think will expose and illustrate some of the examples of what's happening in the industry and more importantly, kind of where it's going. >> Well it's great to be back in our studios in Palo Alto, John. Seems like just yesterday was August 9th, where the community was really refining the definition of Super Cloud. We were identifying the essential characteristics, with some of the leading technologists in Silicon Valley. We were digging into the deployment models. Whereas this Supercloud, Supercloud2 is really taking a practitioner view. We're going to hear from Walmart today. They've built a Supercloud. They called it the Walmart Cloud native platform. We're going to hear from other data practitioners, like Saks. We're going to hear from Western Union. They've got 200 locations around the world, how they're dealing with data sovereignty. And of course we've got some local technologists and practitioners coming in, analysts, consultants, theCUBE community. I'm really excited to be here. >> And we've got some great keynotes from executives at VMware. We're going to expose some of the things that they're working on around cross cloud services, which leads into multicloud. I think the practitioner angle highlights my favorite part of this program, 'cause you're starting to see the builders, a term coined by Andy Jassy, early days of AWS. That builder movement has been continuing to go. And you're seeing the enterprise, global enterprises adopt this builder mentality with Cloud Native. This is going to power the next generation global economy. And I think the role of the cloud computing vendors like AWS, Azure, Google, Alibaba are going to be the source engine of innovation. And what gets built on top of and with the clouds will be a big significant market value for all businesses and their business models. So I think the market wants the supercloud, the business models are pointing to Supercloud. The technology needs supercloud. And society, from an economic standpoint and from a use case standpoint, needs supercloud. You're seeing it today. Everyone's talking about chat GPT. This is an example of what will come out of this next generation and it's just getting started. So to me, you're either on the supercloud side of the camp or you're on the old school, hugging onto the old school mentality of wait a minute, that's cloud computing. So I think if you're not on the super cloud wave, you're going to be driftwood. And that's a term coined by Pat Gelsinger. And this is really the reality. Are you on the super cloud side? Or are you on the old huggin' the old model? And that's going to be a determinant. And you're going to see who's going to be the players on that, Dave. This is going to be a real big year. >> Everybody's heard the phrase follow the money. Well, my philosophy is follow the data. And that's a big part of what Supercloud2 is, because the data is where the money is across the clouds. And people want more simplicity, or greater simplicity across the clouds. So it's really, there's two forces here. You've got the ecosystem that's saying, hey the hyperscalers, they've done a great job but there's problems that they're not solving. So we're going to lean in and solve those problems. At the same time, you have the practitioners saying we have multicloud, we have to deal with this, help us. It's got to be simpler. Because we want to share data across clouds. We want to build data products, we want to monetize and drive revenue and cut costs. >> This is the key thing. The builder movement is hitting a wall, and that wall will be broken down because the business models of the companies themselves are demanding that the value from the data with security has to be embedded. So I think you're going to see a big year this next year or so where the builders will accelerate through this next generation, supercloud wave, will be a builder's wave for business. And I think that's going to be the nuance here. And all the people that are on the side of Supercloud are all pro-business, pro-technology. The ones that aren't are like, wait a minute I used to do things differently. They're stuck. And so I think this is going to be a question of are we stuck? Are builders accelerating? Will the business models develop around it? That's digital transformation. At the end of the day, the market's speaking, Dave. The market wants more. Chat GPT, you're seeing AI starting to flourish, powered by data. It's unstoppable, supercloud's unstoppable. >> One of our headliners today is Zhamak Dehghani, the creator of Data Mesh. We've got some news around her. She's going to be live in studio. Super excited about that. Kit Colbert in Supercloud, the first Supercloud in last August, laid out an initial architecture for Supercloud. He's going to advance that today, tell us what's changed, and really dig into and really talk about the meat on the bone, if you will. And we've got some other technologists that are coming in saying, Hey, is it a platform? Is it an architecture? What's the right model here? So we're going to debate that a little bit today. >> And before we close, I'll just say look at the guests, look at the talk tracks. You're seeing a diversity of startups doing cloud networking, you're seeing big practitioners building their own thing, being builders for business value and business model advantages. And you got companies like VMware, who have been on the wave of virtualization. So the, everyone who's involved in super cloud, they're seeing it, they're on the front lines. They're seeing the trend. They are riding that wave. And they have, they're bringing data to the table. So to me, you look at who's involved and you judge it that way. To me, that's the way I look at this. And because we're making it open, Supercloud is going to continue to be debated. But more importantly, the results are going to come in. The market supports it, the business needs it, tech's there, and will it happen? So I think the builders movement, Dave, is going to be big to watch. And then ultimately how that business transformation kicks in, and I think those are the two variables that I would watch on Supercloud. >> Our mission has always been around free content, giving back to the community. So I really want to thank our sponsors today. We've had a great partnership with VMware, who's not only contributed some financial support, but also great content. Alkira, ChaosSearch, prosimo, all phenomenal, allowing us to achieve our mission of serving our audiences and really trying to give more than we take from. >> Free content, that's our mission. Dave, great to kick it off. Kickin' off Supercloud2 all day, we've got some great programs here. We've got VMware coming up next. We have Victoria Viering, who's been on before. He's got a great vision for cross cloud service. We're getting also a keynote with Kit Colbert, who's going to lay out the fragmentation and the benefits that that solves, from solvent fragmentation and silos, breaking down the silos and bringing multicloud future to the table via Super Cloud. So stay with us. We'll be right back after this short break. (bright upbeat music) (music fades)

(soft music) >> Welcome back to Chicago guys and gals. Lisa Martin here with John Furrier. We have been covering Ansible Fest '22 for the last two days. This is our show wrap. We're going to leave you with some great insights into the things that we were able to dissect over the last two days. John, this has been an action packed two days. A lot of excitement, a lot of momentum. Good to be back in person. >> It's great to be back in person. It was the first time for you to do Ansible Fest. >> Yes. >> My first one was 2019 in person. That's the last time they had an event in person. So again, it's a very chill environment here, but it's content packed, great active loyal community and is growing. It's changing. Ansible now owned by Red Hat, and now Red Hat owned by IBM. Kind of see some game changing kind of movements here on the chess board, so to speak, in the industry. Ansible has always been a great product. It started in open source. It evolved configuration management configuring servers, networks. You know, really the nuts and bolts of IT. And became a fan favorite mainly because it was built by the fans and I think that never stopped. And I think you started to see an opportunity for Ansible to be not only just a, I won't say niche product or niche kind of use case to being the overall capabilities for large scale enterprise system architectures, system management. So it's very interesting. I mean I find it fascinating how, how it stays relevant and cool and continues to power through a massive shift >> A massive shift. They've done a great job though since the inception and through the acquisition of being still community first. You know, we talked a lot yesterday and today about helping organizations become automation first that Ansible has really stayed true to its roots in being community first, community driven and really that community flywheel was something that was very obvious the last couple of days. >> Yeah, I mean the community thing is is is their production system. I mean if you look at Red Hat, their open source, Ansible started open source, good that they're together. But what people may or may not know about Ansible is that they build their product from the community. So the community actually makes the suggestions. Ansible's just in listening modes. So when you have a system that's that efficient where you have direct working backwards from the customer like that, it's very efficient. Now, as a product manager you might want to worry about scope creep, but at the end of the day they do a good job of democratizing that process. So again, very strong product production system with open source, very relevant, solves the right problems. But this year the big story to me is the cultural shift of Ansible's relevance. And I think with multicloud on the horizon, operations is the new kind of developer kind of ground. DevOps has been around for a while. That's now shifted up to the developer themselves, the cloud native developer. But at cloud scale and hybrid computing, it's about the operations. It's about the data and the security. All of it's about the data. So to me there's a new ops configuration operating model that you're seeing people use, SRE and DevOps. That's the new culture, and the persona's changing. The operator of a large scale enterprise is going to be a lot different than it was past five, 10 years. So major cultural shift, and I think this community's going to step up to that position and fill that role. >> They seem to be having a lot of success meeting people where they are, meeting the demographics, delivering on how their community wants to work, how they want to collaborate. But yesterday you talked about operations. We talked a lot about Ops as code. Talk about what does that mean from your perspective, and what did you hear from our guests on the program with respect that being viable? >> Well great, that's a great point. Ops as code is the kind of their next layer of progression. Infrastructure is code. Configuration is code. Operations is code. To me that means running the company as software. So software influencing how operators, usually hardware in the past. Now it's infrastructure and software going to run things. So ops as code's, the next progression in how people are going to manage it. And I think most people think of that as enterprises get larger, when they hear words like SRE, which stands for Site Reliable Engineer. That came out of Google, and Google had all these servers that ran the search engine and at scale. And so one person managed boatload of servers and that was efficient. It was like a multiple 10x engineer, they used to call it. So that that was unique to Google but not everyone's Google. So it became language or parlance for someone who's running infrastructure but not everyone's that scale. So scale is a big issue. Ops as code is about scale and having that program ability as an operator. That's what Ops as code is. And that to me is a sign of where the scale meets the automation. Large scale is hard to do. Automating at large scale is even harder. So that's where Ansible fits in with their new automation platform. And you're seeing new things like signing code, making sure it's trusted and verified. So that's the software supply chain issue. So they're getting into the world where software, open source, automation are all happening at scale. So to me that's a huge concept of Ops as code. It's going to be very relevant, kind of the next gen positioning. >> Let's switch gears and talk about the partner ecosystem. We had Stefanie Chiras on yesterday, one of our longtime theCUBE alumni, talking about what they're doing with AWS in the marketplace. What was your take on that, and what's the "what's in it for me" for both Red Hat, Ansible and AWS? >> Yeah, so the big news on the automation platform was one. The other big news I thought was really, I won't say watered down, but it seems small but it's not. It's the Amazon Web Services relationship with Red Hat, now Ansible, where Ansible's now a product in AWS's marketplace. AWS marketplace is kind of hanging around. It's a catalog right now. It's not the most advanced technical system in the world, and it does over 2 billion plus revenue transactions. So even if it's just sitting there as a large marketplace, that's already doing massive amounts of disruption in the procurement, how software is bought. So we interviewed them in the past, and they're innovating on that. They're going to make that a real great platform. But the fact that Ansible's in the marketplace means that their sales are going to go up, number one. Number two, that means customers can consume it simply by clicking a button on their Amazon bill. That means they don't have to do anything. It's like getting a PO for free. It's like, hey, I'm going to buy Ansible, click, click, click. And then by the way, draw that down from their commitment to AWS. So that means Amazon's going into business with Ansible, and that is a huge revenue thing for Ansible, but also an operational efficiency thing that gives them more of an advantage over the competition. >> Talk what's in it for me as a customer. At Red Hat Summit a few months ago they announced similar partnership with Azure. Now we're talking about AWS. Customers are living in this hybrid cloud world, often by default. We're going to see that proliferate. What do you think this means for customers in terms of being able to- >> In the marketplace deal or Ansible? >> Yeah, the marketplace deal, but also what Red Hat and Ansible are doing with the hyperscalers to enable customers to live successfully in the hyper hybrid cloud world. >> It's just in the roots of the company. They give them the choice to consume the product on clouds that they like. So we're seeing a lot of clients that have standardized on AWS with their dev teams but also have productivity software on Azure. So you have the large enterprises, they sit on both clouds. So you know, Ansible, the customer wants to use Ansible anyway, they want that to happen. So it's a natural thing for them to work anywhere. I call that the Switzerland strategy. They'll play with all the clouds. Even though the clouds are fighting against each other, and they have to to differentiate, there's still going to be some common services. I think Ansible fits this shim layer between clouds but also a bolt on. Now that's a really a double win for them. They can bolt on to the cloud, Azure and bolt on to AWS and Google, and also be a shim layer technically in clouds as well. So there's two technical advantages to that strategy >> Can Ansible be a facilitator of hybrid cloud infrastructure for organizations, or a catalyst? >> I think it's going to be a gateway on ramp or gateway to multicloud or supercloud, as we call it, because Ansible's in that configuration layer. So you know, it's interesting to hear the IBM research story, which we're going to get to in a second around how they're doing the AI for Ansible with that wisdom project. But the idea of configuring stuff on the fly is really a concept that's needed for multicloud 'Cause programs don't want to have to configure anything. (he laughs) So standing up an application to run on Azure that's on AWS that spans both clouds, you're going to need to have that automation, and I think this is an opportunity whether they can get it or not, we'll see. I think Red Hat is probably angling on that hard, and I can see them kind of going there and some of the commentary kind of connects the dots for that. >> Let's dig into some of news that came out today. You just alluded to this. IBM research, we had on with Red Hat. Talk about what they call project wisdom, the value in that, what it also means for for Red Hat and IBM working together very synergistically. >> I mean, I think the project wisdom is an interesting dynamic because you got the confluence of the organic community of Ansible partnering with a research institution of IBM research. And I think that combination of practitioners and research groups is going to map itself out to academic and then you're going to see this kind of collaboration going forward. So I think it's a very nuanced story, but the impact to me is very clear that this is the new power brokers in the tech industry, because researchers have a lot of muscle in terms of deep research in the academic area, and the practitioners are the ones who are actually doing it. So when you bring those two forces together, that pretty much trumps any kind of standards bodies or anything else. So I think that's a huge signaling benefit to Ansible and Red Hat. I think that's an influence of Red Hat being bought by IBM. But the project itself is really amazing. It's taking AI and bringing it to Ansible, so you can do automated configurations. So for people who don't know how to code they can actually just automate stuff and know the process. I don't need to be a coder, I can just use the AI to do that. That's a low code, no code dynamic. That kind of helps with skill gaps, because I need to hire someone to do that. Today if I want to automate something, and I don't know how to code, I've got to get someone who codes. Here I can just do it and automate it. So if that continues to progress the way they want it to, that could literally be a game changer, 'cause now you have software configuring machines and that's pretty badass in my opinion. So that thought that was pretty cool. And again it's just an evolution of how AI is becoming more relevant. And I think it's directionally correct, and we'll see how it goes. >> And they also talked about we're nearing an inflection point in AI. You agree? >> Yeah I think AI is at an inflection point because it just falls short on the scale side. You see it with chatbots, NLP. You see what Amazon's doing. They're building these models. I think we're one step away from model scaling. I think the building the models is going to be one of these things where you're going to start to see marketplace and models and you start to composability of AI. That's where it's going to get very interesting to see which cloud is the best AI scale. So I think AI at scale's coming, and that's going to be something to watch really closely. >> Something exciting. Another thing that was big news today was the event driven Ansible. Talk about that, and that's something they've been working on in conjunction with the community for quite a while. They were very proud of that release and what that's going to enable organizations to do. >> Well I think that's more meat on the bone on the AI side 'cause in the big trend right now is MLAI ops. You hear that a lot. Oh, data ops or AI ops. What event driven automation does is allows you to take things that are going on in your world, infrastructure, triggers, alarms, notifications, data pipelining flows, things that go on in the plumbing of infrastructure. are being monitored and observed. So when events happen they trigger events. You want to stream something, you send a trigger and things happen. So these are called events. Events are wide ranging number of events. Kafka streaming for data. You got anything that produces data is an event. So harnessing that data into a pipeline is huge. So doing that at scale, that's where I think that product's a home run, and I think that's going to be a very valuable product, 'cause once you understand what the event triggers are, you then can automate that, and no humans involved. So that will save a lot of time for people in the the higher pay grade of MLAI ops automate some of that low level plumbing. They move their skill set to something more valuable or more impactful. >> And we talked about, speaking of impact, we talked about a lot of the business impact that organizations across industries are going to be able to likely achieve by using that. >> Yeah, I mean I think that you're going to see the community fill the gap on that. I mean the big part about all this is that their community builds the product and they have the the playbooks and they're shareable and they're reusable. So we produce content as a media company. They'd talk about content as is playbooks and documentation for people to use. So reuse and and reusing these playbooks is a huge part of it. So as they build up these catalogs and these playbooks and rules, it gets better by the community. So it's going to be interesting to see the adoption. That's going to be a big tell sign for what's going to happen. >> Yep, we get definitely are going to be watching that space. And the last thing, we got to talk to a couple of customers. We talked to Wells Fargo who says "We are a tech company that does banking," which I loved. We got to talk with Rockwell Automation. What are some of your takeaways from how the customers are leveraging Ansible and the technology to drive their businesses forward to meet demanding customers where they are? >> I think you're seeing the script flipping a little bit here, where the folks that used to use Ansible for configuration are flipping to be on the front edge of the innovation strategy where what process to automate is going to drive the profitability and scale. Cause you're talking about things like skill gaps, workflows. These are business constructs and people These are assets so they have economic value. So before it was just, IT serve the business, configure some servers, do some stuff. When you start getting into automation where you have expertise around what this means, that's economic value. So I think you're going to see the personas change significantly in this community where they're on the front lines, kind of like developers are. That's why ops as code is to me a developer kind of vibe. That's going to completely change how operations runs in IT. And I think that's going to be a very interesting cultural shift. And some will make it, some won't. That's going to be a big thing. Some people say, I'm going to retire. I'm old school storage server person, or no, I'm the new guard. I'm going to be the new team. I'm going be on the right side of history here. So they're clearly going down that right path in my opinion. >> What's your overall summary in the last minute of what this event delivered the last couple of days in terms of really talking about the transformation of enterprises and industries through automation? >> I think the big takeaway from me in listening and reading the tea leaves was the Ansible company and staff and the community together. It was really a call for arms. Like, hey, we've had it right from the beginning. We're on the right wave and the wave's getting bigger. So expand your scope, uplevel your skills. They're on the right side of history. And I think the message was engage more. Bring more people in because it is open source, and if they are on that track, you're going to see more of hey, we got it right, let's continue. So they got platform release. They got the key products coming out after years of work. So you know, they're doing their work. And the message I heard was, it's bigger than we thought. So I think that's interesting. We'll see what that means. We're going to unpack that after the event in series of showcases. But yeah, it was very positive, I thought. Very positive. >> Yeah, I think there was definitely some surprises in there for them. John, thank you so much. It's been a pleasure co-hosting with you the last couple of days, really uncovering what Ansible is doing, what they're enabling customers in every industry to achieve. >> Been fun. >> Yes. All right for my co-host, John Furrier, I'm Lisa Martin. You've been watching theCUBE's coverage of Ansible Fest 2022 live from Chicago. We hope you take good care and we'll see you soon.

>>Good morning live from Chicago. It's the cube on the floor at Ansible Fast 2022. This is day two of our wall to wall coverage. Lisa Martin here with John Furrier. John, we're gonna be talking next in the segment with two alumni about what Red Hat and IBM are doing to give Ansible users AI superpowers. As one of our alumni guests said, just off the keynote stage, we're nearing an inflection point in ai. >>The power of AI with Ansible is really gonna be an innovative, I think an inflection point for a long time because Ansible does such great things. This segment's gonna explore that innovation, bringing AI and making people more productive and more importantly, you know, this whole low code, no code, kind of right in the sweet spot of the skills gap. So should be a great segment. >>Great segment. Please welcome back two of our alumni. Perry is here, the Chief scientist, IBM Research and IBM Fellow. And Tom Anderson joins us once again, VP and general manager at Red Hat. Gentlemen, great to have you on the program. We're gonna have you back. >>Thank you for having >>Us and thanks for joining us. Fresh off the keynote stage. Really enjoyed your keynote this morning. Very exciting news. You have a project called Project Wisdom. We're talking about this inflection point in ai. Tell the audience, the viewers, what is Project Wisdom And Wisdom differs from intelligence. How >>I think Project Wisdom is really about, as I said, sort of combining two major forces that are in many ways disrupting and, and really constructing many a aspects of our society, which are software and AI together. Yeah. And I truly believe it's gonna result in a se shift on how not just enterprises, but society carries forefront. And as I said, intelligence is, is, I would argue at least artificial intelligence is more, in some ways mechanical, if I may say it, it's about algorithms, it's about data, it's about compute. Wisdom is all about what is truly important to bring out. It's not just about when you bring out a, a insight, when you bring out a decision to be able to explain that decision as well. It's almost like humans have wisdom. Machines have intelligence and, and it's about project wisdom. That's why we called it wisdom. >>Because it is about being a, a assistant augmenting humans. Just like be there with the humans and, and almost think of it as behave and interact with them as another colleague will versus intelligence, which is, you know, as I said, more mechanical is about data. Computer algorithms crunch together and, and we wanna bring the power of project wisdom and artificial intelligence to developers to, as you said, close the skills gap to be able to really make them more productive and have wisdom for Ansible be their assistant. Yeah. To be able to get things for them that they would find many ways mundane, many ways hard to find and again, be an assistant and augmented, >>You know, you know what's interesting, I want to get into the origin, how it all happened, but interesting IBM research, well known for the deep tech, big engineering. And you guys have been doing this for a long time, so congratulations. But it's interesting here at this event, even on stage here event, you're starting to see the automation come in. So the question comes up, scale. So what happens, IBM buys Red Hat, you go raid the, the raid, the ip, Trevor Treasure trove of ai. I mean this cuz this is kind of like bringing two killer apps together. The Ansible configuration automation layer with ai just kind of a, >>Yeah, it's an amazing relationship. I was gonna say marriage, but I don't wanna say marriage cause I may be >>Last. I didn't mean say raid the Treasure Trobe, but the kind of >>Like, oh my God. An amazing relationship where we bring all this expertise around automation, obviously around IP and application infrastructure automation and IBM research, Richie and his team bring this amazing capacity and experience around ai. Bring those two things together and applying AI to automation for our teams is so incredibly fantastic. I just can't contain my enthusiasm about it. And you could feel it in the keynote this morning that Richie was doing the energy in the room and when folks saw that, it's just amazing. >>The geeks are gonna love it for sure. But here I wanna get into the whole evolution. Computers on computers, remember the old days thinking machines was a company generations ago that I think they've sold or went outta business, but self-learning, learning machines, computers, programming, computers was actually on your slide you kind of piece out this next wave of AI and machine learning, starting with expert systems really kind of, I'm almost say static, but like okay programs. Yeah, yeah. And then now with machine learning and that big debate was unsupervised, supervised, which is not really perfect. Deep learning, which now explores some things, but now we're at another wave. Take, take us through the thought there explaining what this transition looks like and why. >>I think we are, as I said, we are really at an inflection point in the journey of ai. And if ai, I think it's fair to say data is the pain of ai without data, AI doesn't exist. But if I were to train AI with what is known as supervised learning or or data that is labeled, you are almost sort of limited because there are only so many people who have that expertise. And interestingly, they all have day jobs. So they're not just gonna sit around and label this for you. Some people may be available, but you know, this is not, again, as I as Tom said, we are really trying to apply it to some very sort of key domains which require subject matter expertise. This is not like labeling cats and dogs that everybody else in the board knows there are, the community's very large, but still the skills to go around are not that many. >>And I truly believe to apply AI to the, to the word of, you know, enterprises information technology automation, you have to have unsupervised learning and that's the only way to skate. Yeah. And these two trends really about, you know, information technology percolating across every enterprise and unsupervised learning, which is learning on this very large amount of data with of course know very large compute with some very powerful algorithms like transformer architectures and others which have been disrupting the, the domain of natural language as well are coming together with what I described as foundation models. Yeah. Which anybody who plays with it, you'll be blown away. That's literally blown away. >>And you call that self supervision at scale, which is kind of the foundation. So I have to ask you, cuz this comes up a lot with cloud, cloud scale, everyone tells horizontally scalable cloud, but vertically specialized applications where domain expertise and data plays. So the better the data, the better the self supervision, better the learning. But if it's horizontally scalable is a lot to learn. So how do you create that data ops where it's where the machines are gonna be peaked to maximize what's addressable, but what's also in the domain too, you gotta have that kind of diversity. Can you share your thoughts on that? >>Absolutely. So in, in the domain of foundation models, there are two main stages I would say. One is what I'll describe as pre-training, which is think of it as the, the machine in this particular case is knowledgeable about the domain of code in general. It knows syntax of Python, Java script know, go see Java and so, so on actually, and, and also Yammel as well, which is obviously one would argue is the domain of information technology. And once you get to that level, it's a, it's almost like having a developer who knows all of this but may not be an expert at Ansible just yet. He or she can be an expert at Ansible but is not there yet. That's what I'll call background knowledge. And also in the, in the case of foundation models, they are very adept at natural language as well. So they can connect natural language to code, but they are not yet expert at the domain of Ansible. >>Now there's something called, the second stage of learning is called fine tuning, which is about this data ops where I take data, which is sort of the SME data in this particular case. And it's curated. So this is not just generic data, you pick off GitHub, you don't know what exists out there. This is the data which is governed, which we know is of high quality as well. And you think of it as you specialize the generic AI with pre-trained AI with that data. And those two stages, including the governance of that data that goes into it results in this sort of really breakthrough technology that we've been calling Project Wisdom for. Our first application is Ansible, but just watch out that area. There are many more to come and, and we are gonna really, I'm really excited about this partnership with Red Hat because across IBM and research, I think where wherever we, if there is one place where we can find excited, open source, open developer community, it is Right. That's, >>Yeah. >>Tom, talk about the, the role of open source and Project Wisdom, the involvement of the community and maybe Richard, any feedback that you've gotten since coming off stage? I'm sure you were mobbed. >>Yeah, so for us this is, it's called Project Wisdom, not Product Wisdom. Right? Sorry. Right. And so, no, you didn't say that but I wanna just emphasize that it is a project and for us that is a key word in the upstream community that this is where we're inviting the community to jump on board with us and bring their expertise. All these people that are here will start to participate. They're excited in it. They'll bring their expertise and experience and that fine tuning of the model will just get better and better. So we're really excited about introducing this now and involving the community because it's super nuts. Everything that Red Hat does is around the community and this is no different. And so we're really excited about Project Wisdom. >>That's interesting. The project piece because if you see in today's world the innovation strategy before where we are now, go back to say 15 years ago it was of standard, it's gotta have standard bodies. You can still innovate and differentiate, but yet with open source and community, it's a blending of research and practitioners. I think that to me is a big story here is that what you guys are demonstrating is the combination of research and practitioners in the project. Yes. So how does this play out? Cuz this is kind of like how things are gonna get done in the cloud cuz Amazon's not gonna just standardize their stack at at higher level services, nor is Azure and they might get some plumbing commonalities below, but for Project Project Wisdom to be successful, they can, it doesn't need to have standards. If I get this right, if I can my on point here, what do you guys think about that? React to that? Yeah, >>So I definitely, I think standardization in terms of what we will call ML ops pipeline for models to be deployed and managed and operated. It's like models, like any other code, there's standardization on DevOps ops pipeline, there's standardization on machine learning pipeline. And these models will be deployed in the cloud because they need to scale. The only way to scale to, you know, thousands of users is through cloud. And there is, there are standard pipelines that we are working and architecting together with the Red Hat community leveraging open source packages. Yeah. Is really to, to help scale out the AI models of wisdom together. And another point I wanted to pick up on just what Tom said, I've been sort of in the area of productizing AI for for long now having experience with Watson as well. The only scenario where I've seen AI being successful is in this scenario where, what I describe as it meets the criteria of flywheel of ai. >>What do I mean by flywheel of ai? It cannot be some research people build a model. It may be wowing, but you roll it out and there's no feedback. Yeah, exactly. Okay. We are duh. So what actually, the only way the more people use these models, the more they give you feedback, the better it gets because it knows what is right and what is not right. It will never be right the first time. Actually, you know, the data it is trained on is a depiction of reality. Yeah. It is not a reality in itself. Yeah. The reality is a constantly moving target and the only way to make AI successful is to close that loop with the community. And that's why I just wanted to reemphasize the point on why community is that important >>Actually. And what's interesting Tom is this is a difference between standards bodies, old school and communities. Because developers are very efficient in their feedback. Yes. They jump to patterns that serve their needs, whether it's self-service or whatever. You can kind of see what's going on. Yeah. It's either working or not. Yeah, yeah, >>Yeah. We get immediate feedback from the community and we know real fast when something isn't working, when something is working, there are no problems with the flow of data between the members of the community and, and the developers themselves. So yeah, it's, I'm it's great. It's gonna be fantastic. The energy around Project Wisdom already. I bet. We're gonna go down to the Project Wisdom session, the breakout session, and I bet you the room will be overflowed. >>How do people get involved real quick? Get, get a take a minute to explain how I would get involved. I'm a community member. Yep. I'm watching this video, I'm intrigued. This has got me enthusiastic. How do I get more confident with this opportunity? >>So you go to, first of all, you go to red hat.com/project Wisdom and you register your interests and you wanna participate. We're gonna start growing this process, bringing people in, getting ready to make the service available to people to start using and to experiment with. Start getting their feedback. So this is the beginning of, of a journey. This isn't the, you know, this isn't the midpoint of a journey, this is the begin. You know, even though the work has been going on for a year, this is the beginning of the community journey now. And so we're gonna start working together through channels like Discord and whatnot to be able to exchange information and bring people in. >>What are some of the key use cases, maybe Richie are starting with you that, that you think maybe dream use cases that you think the community will help to really uncover as we're looking at Project Wisdom really helping in this transformation of ai. >>So if I focus on let's say Ansible itself, there are much wider use cases, but Ansible itself and you know, I, I would say I had not realized, I've been working on AI for Good for long, but I had not realized the excitement and the power of Ansible community itself. It's very large, it's very bottom sum, which I love actually. But as I went to lot of like CTOs and CIOs of lot of our customers as well, it was becoming clear the use cases of, you know, I've got thousand Ansible developers or IT or automation experts. They write code all the time. I don't know what all of this code is about. So the, the system administrators, managers, they're trying to figure out sort of how to organize all of this together and think of it as Google for finding all of these automation code automation content. >>And I'm very excited about not just the use cases that we demonstrated today, that is beginning of the journey, but to be able to help enterprises in finding the right code through natural language interfaces, generating the code, helping Del us debug their code as well. Giving them predictive insights into this may happen. Just watch out for it when you deploy this. Something like that happened before, just watch out for it as well. So I'm, I'm excited about the entire life cycle of IT automation, Not just about at the build time, but also at the time of deployment. At the time of management. This is just a start of a journey, but there are many exciting use cases abound for Ansible and beyond. >>It's gonna be great to watch this as it unfolds. Obviously just announcing this today. We thank you both so much for joining us on the program, talking about Project wisdom and, and sharing how the community can get involved. So you're gonna have to come back next year. We're gonna have to talk about what's going on. Cause I imagine with the excitement of the community and the volume of the community, this is just the tip of the iceberg. Absolutely. >>This is absolutely exactly. You're excited about. >>Excellent. And you should be. Congratulations. Thank, thanks again for joining us. We really appreciate your insights. Thank you. Thank >>You for having >>Us. For our guests and John Furrier, I'm Lisa Barton and you're watching The Cube Lie from Chicago at Ansible Fest 22. This is day two of wall to wall coverage on the cube. Stick around. Our next guest joins us in just a minute.

>>Welcome back to Vegas. Lisa Martin here covering snowflake summit 22. We are live at Caesar's forum. A lot of guests here about 10,000 attendees, actually 10,000 plus a lot of folks here at the momentum and the buzz. I gotta tell you the last day and a half we've been covering this event is huge. It's probably some of the biggest we've seen in a long time. We're very pleased to welcome back. One of our cube alumni to the program, Ron Tayo principal and chief data officer at Deloitte one. It's great to have you joining us. >>Yeah, no, thank you. Super excited to be here with you today. >>Isn't it great to be back in person? Oh, >>I love it. I mean the, the energy, the, you know, connections that we're making definitely, definitely loving and loving the experience. >>Good experience, but the opportunity to connect with customers. Yes. I'm hearing a lot of conversations from snowflake folks from their partners like Deloitte from customers themselves. Like it's so great to be back in person. And they're really talking about some of the current challenges that are being faced by so many industries. >>That's right. Oh, that, that is, you know, I would say as a consultant, you know, it all comes down to that personal connection and that relationship. And so I am, I'm all for this and love, you know, being able to connect with our customers. >>Yeah. Talk to me about the Deloitte snowflake partnership. Obviously a ton of news announced from snowflake yesterday. Snowflake is a rocket ship. Talk to us about the partnership, what you guys do together, maybe some joint customer examples. >>Yeah. I mean, so snowflake is a strategic Alliance partner. We won the, you know, SI partner of the year award and for us, the, the shift and the opportunity to help our clients modernize and achieve a level of data maturity in their journey is, is strategically it's super important. And it's really about how do we help them leverage, you know, snowflake has underlying data platform to ultimately achieve, you know, broader goals around, you know, their business strategy. And our approach is always very much connected to overarching business strategies and sense of, is it a finance transformation, a supply chain transformation, a customer transformation, and what are the goals of those transformations and how do we ensure that data is a critical component to enabling that and with, you know, technologies and vendors and partners like snowflake, allowing us to even do that at a faster, better, cheaper pace only increases the overall business case and the value and the impact that it generates. >>And so we are super, super excited about our partnership with snowflake and we believe, you know, the journey is very, very bright. You know, we, this is the future, you know, often tell folks that, you know, data has and will continue to be more valuable than sort of the systems that own it and manage it. And I think we're starting to see that. I think the topic that I discussed today around data collaboration and data sharing is an example of how we're starting to see, you know, the importance and the value of data, you know, become way more important and more of the focus around the strategy for, for organizations >>As the chief data officer, what do data sharing and data collaboration mean to somebody in your position and what are some of the conversations you have with customer other CDOs at customer organizations? >>Yeah, so, so my role is, is sort of twofold. I, I am responsible for our internal data strategy. So when you think about Deloitte as a professional service organization, across four unique businesses, I am a customer of snowflake in our own data modernization journey, and we have our own strategy on how and what we share, not only internally across our businesses, but also externally across, you know, our partners. So, so I bring that perspective, but then I also am a client service professional and serve our clients in their own journey. So I often feel very privileged in, in the opportunity to be able to sort of not only share my own experience from a Deloitte perspective, but also in how we help our clients >>Talk about data maturation. You mentioned, you know, the volume of data just only continues to grow. We've seen so much growth in the last two years alone of data. We've seen all of us be so dependent on things like media and entertainment and retail, eCommerce, healthcare, and life sciences. What, how do you define data maturation and how does Deloitte and snowflake help companies create a pathway to get there? >>Yeah. Yeah. So I would say step one for us is all about the overarching business strategy. And when you sort of double click on the big, broad business strategy and what that means from a data strategy perspective, we have to develop business models where there is an economical construct to the value of data. And it's extremely important specifically when we talk about sharing and collaborating data, I would say the, the, the, the assumption or the, or, or, or, or the posture typically seems to be, it's a one way relationship, our strategy and what we're pushing, you know, again, not only internally within ourselves, but also with our clients, is it has to be a bidirectional relationship. And so you, you hear of, of the concepts of, you know, the, the, the data clean room where you have two partners coming together and agreeing with certain terms to share data bidirectionally. Like I do believe that is the future in how we need to do, you know, more data collaboration, more data sharing at a scale that we've not quite seen. Yes. Yet >>The security and privacy areas are increasingly critical. We've seen the threat landscape change so dramatically the last couple of years, it's not, will we get hit by a cyber talk? It's when yes. For every industry, right? The privacy legislation that just we've seen it with GDPR, CCPA is gonna become CPR in California, other states doing the same thing. How do you help customers kind of balance that line of being able to share data equitably between organizations between companies do so in a secure way, and in a way that ensures data privacy will be maintained. >>Yeah. Yeah. So first absolutely recognizing, evolving, recognize the evolving regulatory landscape. You mentioned, you know, California, there's actually now 22 states that have a, is it 22 now? Right? Yeah. 22 states that have a privacy act enacted. And our projection is in the next 12 to 18 months, all states will have one. And so absolutely a, a perceived challenge, but one that I think is, is addressable. And, and I think that gets to the spirit of the question for us. There's, there's four dimensions that an organization needs to work through when it comes to data sharing. The first one is back to the, the business goal and objective, like, is there truly a business need? And is there value in sharing data? And it needs to have a very solid business model. Okay. So, so that's the first step. The second step is what are the legal terms? >>What are the legal terms? What can you do? What can't you do? Do you have primary rights, secondary rights? The third dimension is around risk. What is the risk and exposure, not only from a data security perspective, but what is the risk if someone uses a data inappropriately, and then the fourth one is around ethics and the ethical use of data. And we see lots of examples where an organization has consent has rights to the data, but the way they used it might have not necessarily been, you know, among the kind of ethical framing. And so for us, those four dimensions is what guides us and our clients in developing a very robust data, sharing data collaboration framework that ensures it's connected to the overall business strategy, but it provides enough of the guardrails to minimize legal and ethical risk. So >>With that in mind, what do the customer conversations look like? Cause you gotta have a lot of players, the business folks, the data folks, every line of business needs data for its functions. Talk to us about how the customer conversations and projects have evolved as data is increasingly important to every line of business. >>Yes. I would say the biggest channel, or maybe the, the, the denominator at this point that we're seeing bring the, let's say diversity of needs to more common denominator has been AI. So every organization at this point is driving massive AI programs. And in order to really scale AI, you know, the, the algorithm cannot execute without data. Yeah. And so for us, at least in our experience with our customers, AI has almost been the, the, the mechanism to have these conversations across the different business stakeholders and do it in a way that, you know, you're not necessarily boiling the ocean, cuz I think that's the other element that makes this a bit hard is, well, what, what data do you want me to share and for what purpose? And when you start to bring it into sort of more individual swim lanes and, and, and our experience with our customers is AI has sort of been that mechanism to say, am I automating, you know, our factory floor? Am I bringing AI and how we engage and serve our customers? Right? Like it be, it be begins to sort of bring a little bit more of, of that repeatability at a, at an individual level. So that's been a, a really good strategy for us in our customers >>In terms of the customer's strategy and kind of looking forward, what are some of the things that excite you about the, the future of data collaboration, especially given all of the news that snowflake announced just yesterday? >>Yes. Yeah. I think for me, and this is both the little bit of the ambition, as well as the push, it's no longer a question of should it's it's how and for what? And so, so yes, I mean the, the, the snowflake data cloud is a network that allows us to integrate, you know, disparate and unique data assets that have never, you know, been possible before. Right. So we're in this network, it's now a matter of figuring out how to use that and for what purpose. And so I, I go back to, we, each individual organization needs to be figuring out the how, and for what not, when this is the future, we all need it. Yeah. And we just need to figure out how that fits in our individual businesses >>In terms of the, how that's such an interesting, I love how you bring that up. It's not, it's not when it's definitely how, because there's gonna be another competing business or several right there in the rear view mirror, ready to take your place. Yep. If you don't act quickly, how does Deloitte and snowflake help customers achieve the, how quickly enough to be able to really take advantage of data sharing and data collaboration so that they can be very competitive? >>Yeah. So there's two main, maybe even three driving forces in this. What we see is when there's a common purpose across director, indirect competitors and the need to share data. So I think the poster child of this was the pandemic, and we started to see organizations again, either competitively or non-com competitively share data in ways for a greater good, right. When there was a purpose, we believe when that element exists, the ability to share data is going to increase. We believe the next big sort of common purpose out there in the world is around ESG. And so that's gonna be a big driver for sharing data. So that's one element. The other one is the concept of developing integrated value chains. So when you think about any individual business and sort of where they are in that piece of the value chain, developing more integrated value across, let's say a manufacturer of goods with a distributor of those goods that ultimately get to an end customer. >>They're not sharing data in a meaningful way to really maximize their overall, you know, profitability. And so that's another really good, meaningful example that we're seeing is where there's value across, you know, a, what appears to be a siloed set of steps, and really looking at it more as an integrated value chain, the need to share data is the only way to unlock that. And so that's, that's the second one. The, the third one I would say is, is around the need to address the consumer across sort of the multiple personas that we all individually sit. Right? So I go into a bank and I'm, I'm a client. I walk into a retail store and I'm a customer. I walk into my physician's office and I'm a patient at the end of the day. I am still the same person. I am still one. And so that consumer element and the convergence of how we are engaging and serving that consumer is the third, big shift that is really going to bring data collaboration and sharing to the next level. >>Do you think snowflake is, is the right partner of the defacto for delight to do that with? >>Absolutely. I think, you know, the head start of the cloud, the data cloud platform and the network that it's already established with all the sort of data privacy and security constraints around it. Like that's a big, that's a big, you know, check right. That we don't have to worry about. It's there for sure. >>Awesome. Sounds like a great partnership, Juan. Thank you so much for joining me on the program. It's great to have you back on the cube in person sharing what Deloitte and snowflake are doing and how you're really helping to transform organizations across every industry. We appreciate >>Your insights. Yeah. No, thank you for having me here. My pleasure. Always a pleasure. Thank you. >>All right. For Juan. I am Lisa Martin. You're watching the cube live from snowflake summit 22 at Caesar's forum. You write back with our next guest.

>>Hello and welcome today's cube presentation of eight of us startup showcase. I'm john for your host highlighting the hottest companies and devops data analytics and cloud management lisa martin and David want are here to kick it off. We've got a great program for you again. This is our, our new community event model where we're doing every quarter, we have every new episode, this is quarter three this year or episode three, season one of the hottest cloud startups and we're gonna be featured. Then we're gonna do a keynote package and then 15 countries will present their story, Go check them out and then have a closing keynote with a practitioner and we've got some great lineups, lisa Dave, great to see you. Thanks for joining me. >>Hey guys, >>great to be here. So David got to ask you, you know, back in events last night we're at the 14 it's event where they had the golf PGA championship with the cube Now we got the hybrid model, This is the new normal. We're in, we got these great companies were showcasing them. What's your take? >>Well, you're right. I mean, I think there's a combination of things. We're seeing some live shows. We saw what we did with at mobile world Congress. We did the show with AWS storage day where it was, we were at the spheres, there was no, there was a live audience, but they weren't there physically. It was just virtual and yeah, so, and I just got pained about reinvent. Hey Dave, you gotta make your flights. So I'm making my flights >>were gonna be at the amazon web services, public sector summit next week. At least a lot, a lot of cloud convergence going on here. We got many companies being featured here that we spoke with the Ceo and their top people cloud management, devops data, nelson security. Really cutting edge companies, >>yes, cutting edge companies who are all focused on acceleration. We've talked about the acceleration of digital transformation the last 18 months and we've seen a tremendous amount of acceleration in innovation with what these startups are doing. We've talked to like you said, there's, there's C suite, we've also talked to their customers about how they are innovating so quickly with this hybrid environment, this remote work and we've talked a lot about security in the last week or so. You mentioned that we were at Fortinet cybersecurity skills gap. What some of these companies are doing with automation for example, to help shorten that gap, which is a big opportunity >>for the job market. Great stuff. Dave so the format of this event, you're going to have a fireside chat with the practitioner, we'd like to end these programs with a great experienced practitioner cutting edge in data february. The beginning lisa are gonna be kicking off with of course Jeff bar to give us the update on what's going on AWS and then a special presentation from Emily Freeman who is the author of devops for dummies, she's introducing new content. The revolution in devops devops two point oh and of course jerry Chen from Greylock cube alumni is going to come on and talk about his new thesis castles in the cloud creating moats at cloud scale. We've got a great lineup of people and so the front ends can be great. Dave give us a little preview of what people can expect at the end of the fireside chat. >>Well at the highest level john I've always said we're entering that sort of third great wave of cloud. First wave was experimentation. The second big wave was migration. The third wave of integration, Deep business integration and what you're >>going to hear from >>Hello Fresh today is how they like many companies that started early last decade. They started with an on prem Hadoop system and then of course we all know what happened is S three essentially took the knees out from, from the on prem Hadoop market lowered costs, brought things into the cloud and what Hello Fresh is doing is they're transforming from that legacy Hadoop system into its running on AWS but into a data mess, you know, it's a passionate topic of mine. Hello Fresh was scaling they realized that they couldn't keep up so they had to rethink their entire data architecture and they built it around data mesh Clements key and christoph Soewandi gonna explain how they actually did that are on a journey or decentralized data >>measure it and your posts have been awesome on data measure. We get a lot of traction. Certainly you're breaking analysis for the folks watching check out David Landes, Breaking analysis every week, highlighting the cutting edge trends in tech Dave. We're gonna see you later, lisa and I are gonna be here in the morning talking about with Emily. We got Jeff Barr teed up. Dave. Thanks for coming on. Looking forward to fireside chat lisa. We'll see you when Emily comes back on. But we're gonna go to Jeff bar right now for Dave and I are gonna interview Jeff. Mm >>Hey Jeff, >>here he is. Hey, how are you? How's it going really well. So I gotta ask you, the reinvent is on, everyone wants to know that's happening right. We're good with Reinvent. >>Reinvent is happening. I've got my hotel and actually listening today, if I just remembered, I still need to actually book my flights. I've got my to do list on my desk and I do need to get my >>flights. Uh, >>really looking forward >>to it. I can't wait to see the all the announcements and blog posts. We're gonna, we're gonna hear from jerry Chen later. I love the after on our next event. Get your reaction to this castle and castles in the cloud where competitive advantages can be built in the cloud. We're seeing examples of that. But first I gotta ask you give us an update of what's going on. The ap and ecosystem has been an incredible uh, celebration these past couple weeks, >>so, so a lot of different things happening and the interesting thing to me is that as part of my job, I often think that I'm effectively living in the future because I get to see all this really cool stuff that we're building just a little bit before our customers get to, and so I'm always thinking okay, here I am now, and what's the world going to be like in a couple of weeks to a month or two when these launches? I'm working on actually get out the door and that, that's always really, really fun, just kind of getting that, that little edge into where we're going, but this year was a little interesting because we had to really significant birthdays, we had the 15 year anniversary of both EC two and S three and we're so focused on innovating and moving forward, that it's actually pretty rare for us at Aws to look back and say, wow, we've actually done all these amazing things in in the last 15 years, >>you know, it's kind of cool Jeff, if I may is is, you know, of course in the early days everybody said, well, a place for startup is a W. S and now the great thing about the startup showcases, we're seeing the startups that >>are >>very near, or some of them have even reached escape velocity, so they're not, they're not tiny little companies anymore, they're in their transforming their respective industries, >>they really are and I think that as they start ups grow, they really start to lean into the power of the cloud. They as they start to think, okay, we've we've got our basic infrastructure in place, we've got, we were serving data, we're serving up a few customers, everything is actually working pretty well for us. We've got our fundamental model proven out now, we can invest in publicity and marketing and scaling and but they don't have to think about what's happening behind the scenes. They just if they've got their auto scaling or if they're survivalists, the infrastructure simply grows to meet their demand and it's it's just a lot less things that they have to worry about. They can focus on the fun part of their business which is actually listening to customers and building up an awesome business >>Jeff as you guys are putting together all the big pre reinvented, knows a lot of stuff that goes on prior as well and they say all the big good stuff to reinvent. But you start to see some themes emerged this year. One of them is modernization of applications, the speed of application development in the cloud with the cloud scale devops personas, whatever persona you want to talk about but basically speed the speed of of the app developers where other departments have been slowing things down, I won't say name names, but security group and I t I mean I shouldn't have said that but only kidding but no but seriously people want in minutes and seconds now not days or weeks. You know whether it's policy. What are some of the trends that you're seeing around this this year as we get into some of the new stuff coming out >>So Dave customers really do want speed and for we've actually encapsulate this for a long time in amazon in what we call the bias for action leadership principle >>where >>we just need to jump in and move forward and and make things happen. A lot of customers look at that and they say yes this is great. We need to have the same bias fraction. Some do. Some are still trying to figure out exactly how to put it into play. And they absolutely for sure need to pay attention to security. They need to respect the past and make sure that whatever they're doing is in line with I. T. But they do want to move forward. And the interesting thing that I see time and time again is it's not simply about let's adopt a new technology. It's how do we >>how do we keep our workforce >>engaged? How do we make sure that they've got the right training? How do we bring our our I. T. Team along for this. Hopefully new and fun and exciting journey where they get to learn some interesting new technologies they've got all this very much accumulated business knowledge they still want to put to use, maybe they're a little bit apprehensive about something brand new and they hear about the cloud, but there by and large, they really want to move forward. They just need a little bit of >>help to make it happen >>real good guys. One of the things you're gonna hear today, we're talking about speed traditionally going fast. Oftentimes you meant you have to sacrifice some things on quality and what you're going to hear from some of the startups today is how they're addressing that to automation and modern devoPS technologies and sort of rethinking that whole application development approach. That's something I'm really excited to see organization is beginning to adopt so they don't have to make that tradeoff anymore. >>Yeah, I would >>never want to see someone >>sacrifice quality, >>but I do think that iterating very quickly and using the best of devoPS principles to be able to iterate incredibly quickly and get that first launch out there and then listen with both ears just >>as much >>as you can, Everything. You hear iterate really quickly to meet those needs in, in hours and days, not months, quarters or years. >>Great stuff. Chef and a lot of the companies were featuring here in the startup showcase represent that new kind of thinking, um, systems thinking as well as you know, the cloud scale and again and it's finally here, the revolution of deVOps is going to the next generation and uh, we're excited to have Emily Freeman who's going to come on and give a little preview for her new talk on this revolution. So Jeff, thank you for coming on, appreciate you sharing the update here on the cube. Happy >>to be. I'm actually really looking forward to hearing from Emily. >>Yeah, it's great. Great. Looking forward to the talk. Brand new Premier, Okay, uh, lisa martin, Emily Freeman is here. She's ready to come in and we're going to preview her lightning talk Emily. Um, thanks for coming on, we really appreciate you coming on really, this is about to talk around deVOPS next gen and I think lisa this is one of those things we've been, we've been discussing with all the companies. It's a new kind of thinking it's a revolution, it's a systems mindset, you're starting to see the connections there she is. Emily, Thanks for coming. I appreciate it. >>Thank you for having me. So your teaser video >>was amazing. Um, you know, that little secret radical idea, something completely different. Um, you gotta talk coming up, what's the premise behind this revolution, you know, these tying together architecture, development, automation deployment, operating altogether. >>Yes, well, we have traditionally always used the sclc, which is the software delivery life cycle. Um, and it is a straight linear process that has actually been around since the sixties, which is wild to me um, and really originated in manufacturing. Um, and as much as I love the Toyota production system and how much it has shown up in devops as a sort of inspiration on how to run things better. We are not making cars, we are making software and I think we have to use different approaches and create a sort of model that better reflects our modern software development process. >>It's a bold idea and looking forward to the talk and as motivation. I went into my basement and dusted off all my books from college in the 80s and the sea estimates it was waterfall. It was software development life cycle. They trained us to think this way and it came from the mainframe people. It was like, it's old school, like really, really old and it really hasn't been updated. Where's the motivation? I actually cloud is kind of converging everything together. We see that, but you kind of hit on this persona thing. Where did that come from this persona? Because you know, people want to put people in buckets release engineer. I mean, where's that motivation coming from? >>Yes, you're absolutely right that it came from the mainframes. I think, you know, waterfall is necessary when you're using a punch card or mag tape to load things onto a mainframe, but we don't exist in that world anymore. Thank goodness. And um, yes, so we, we use personas all the time in tech, you know, even to register, well not actually to register for this event, but a lot events. A lot of events, you have to click that drop down. Right. Are you a developer? Are you a manager, whatever? And the thing is personas are immutable in my opinion. I was a developer. I will always identify as a developer despite playing a lot of different roles and doing a lot of different jobs. Uh, and this can vary throughout the day. Right. You might have someone who has a title of software architect who ends up helping someone pair program or develop or test or deploy. Um, and so we wear a lot of hats day to day and I think our discussions around roles would be a better, um, certainly a better approach than personas >>lease. And I've been discussing with many of these companies around the roles and we're hearing from them directly and they're finding out that people have, they're mixing and matching on teams. So you're, you're an S R E on one team and you're doing something on another team where the workflows and the workloads defined the team formation. So this is a cultural discussion. >>It absolutely is. Yes. I think it is a cultural discussion and it really comes to the heart of devops, right? It's people process. And then tools deVOps has always been about culture and making sure that developers have all the tools they need to be productive and honestly happy. What good is all of this? If developing software isn't a joyful experience. Well, >>I got to ask you, I got you here obviously with server list and functions just starting to see this kind of this next gen. And we're gonna hear from jerry Chen, who's a Greylock VC who's going to talk about castles in the clouds, where he's discussing the moats that could be created with a competitive advantage in cloud scale. And I think he points to the snowflakes of the world. You're starting to see this new thing happening. This is devops 2.0, this is the revolution. Is this kind of where you see the same vision of your talk? >>Yes, so DeVOps created 2000 and 8, 2000 and nine, totally different ecosystem in the world we were living in, you know, we didn't have things like surveillance and containers, we didn't have this sort of default distributed nature, certainly not the cloud. Uh and so I'm very excited for jerry's talk. I'm curious to hear more about these moz. I think it's fascinating. Um but yeah, you're seeing different companies use different tools and processes to accelerate their delivery and that is the competitive advantage. How can we figure out how to utilize these tools in the most efficient way possible. >>Thank you for coming and giving us a preview. Let's now go to your lightning keynote talk. Fresh content. Premier of this revolution in Devops and the Freemans Talk, we'll go there now. >>Hi, I'm Emily Freeman, I'm the author of devops for dummies and the curator of 97 things every cloud engineer should know. I am thrilled to be here with you all today. I am really excited to share with you a kind of a wild idea, a complete re imagining of the S DLC and I want to be clear, I need your feedback. I want to know what you think of this. You can always find me on twitter at editing. Emily, most of my work centers around deVOps and I really can't overstate what an impact the concept of deVOPS has had on this industry in many ways it built on the foundation of Agile to become a default a standard we all reach for in our everyday work. When devops surfaced as an idea in 2008, the tech industry was in a vastly different space. AWS was an infancy offering only a handful of services. Azure and G C P didn't exist yet. The majority's majority of companies maintained their own infrastructure. Developers wrote code and relied on sys admins to deploy new code at scheduled intervals. Sometimes months apart, container technology hadn't been invented applications adhered to a monolithic architecture, databases were almost exclusively relational and serverless wasn't even a concept. Everything from the application to the engineers was centralized. Our current ecosystem couldn't be more different. Software is still hard, don't get me wrong, but we continue to find novel solutions to consistently difficult, persistent problems. Now, some of these end up being a sort of rebranding of old ideas, but others are a unique and clever take to abstracting complexity or automating toil or perhaps most important, rethinking challenging the very premises we have accepted as Cannon for years, if not decades. In the years since deVOps attempted to answer the critical conflict between developers and operations, engineers, deVOps has become a catch all term and there have been a number of derivative works. Devops has come to mean 5000 different things to 5000 different people. For some, it can be distilled to continuous integration and continuous delivery or C I C D. For others, it's simply deploying code more frequently, perhaps adding a smattering of tests for others. Still, its organizational, they've added a platform team, perhaps even a questionably named DEVOPS team or have created an engineering structure that focuses on a separation of concerns. Leaving feature teams to manage the development, deployment, security and maintenance of their siloed services, say, whatever the interpretation, what's important is that there isn't a universally accepted standard. Well, what deVOPS is or what it looks like an execution, it's a philosophy more than anything else. A framework people can utilize to configure and customize their specific circumstances to modern development practices. The characteristic of deVOPS that I think we can all agree on though, is that an attempted to capture the challenges of the entire software development process. It's that broad umbrella, that holistic view that I think we need to breathe life into again, The challenge we face is that DeVOps isn't increasingly outmoded solution to a previous problem developers now face. Cultural and technical challenge is far greater than how to more quickly deploy a monolithic application. Cloud native is the future the next collection of default development decisions and one the deVOPS story can't absorb in its current form. I believe the era of deVOPS is waning and in this moment as the sun sets on deVOPS, we have a unique opportunity to rethink rebuild free platform. Even now, I don't have a crystal ball. That would be very handy. I'm not completely certain with the next decade of tech looks like and I can't write this story alone. I need you but I have some ideas that can get the conversation started, I believe to build on what was we have to throw away assumptions that we've taken for granted all this time in order to move forward. We must first step back. Mhm. The software or systems development life cycle, what we call the S. D. L. C. has been in use since the 1960s and it's remained more or less the same since before color television and the touch tone phone. Over the last 60 or so odd years we've made tweaks, slight adjustments, massaged it. The stages or steps are always a little different with agile and deVOps we sort of looped it into a circle and then an infinity loop we've added pretty colors. But the sclc is more or less the same and it has become an assumption. We don't even think about it anymore, universally adopted constructs like the sclc have an unspoken permanence. They feel as if they have always been and always will be. I think the impact of that is even more potent. If you were born after a construct was popularized. Nearly everything around us is a construct, a model, an artifact of a human idea. The chair you're sitting in the desk, you work at the mug from which you drink coffee or sometimes wine, buildings, toilets, plumbing, roads, cars, art, computers, everything. The sclc is a remnant an artifact of a previous era and I think we should throw it away or perhaps more accurately replace it, replace it with something that better reflects the actual nature of our work. A linear, single threaded model designed for the manufacturer of material goods cannot possibly capture the distributed complexity of modern socio technical systems. It just can't. Mhm. And these two ideas aren't mutually exclusive that the sclc was industry changing, valuable and extraordinarily impactful and that it's time for something new. I believe we are strong enough to hold these two ideas at the same time, showing respect for the past while envisioning the future. Now, I don't know about you, I've never had a software project goes smoothly in one go. No matter how small. Even if I'm the only person working on it and committing directly to master software development is chaos. It's a study and entropy and it is not getting any more simple. The model with which we think and talk about software development must capture the multithreaded, non sequential nature of our work. It should embody the roles engineers take on and the considerations they make along the way. It should build on the foundations of agile and devops and represent the iterative nature of continuous innovation. Now, when I was thinking about this, I was inspired by ideas like extreme programming and the spiral model. I I wanted something that would have layers, threads, even a way of visually representing multiple processes happening in parallel. And what I settled on is the revolution model. I believe the visualization of revolution is capable of capturing the pivotal moments of any software scenario. And I'm going to dive into all the discrete elements. But I want to give you a moment to have a first impression, to absorb my idea. I call it revolution because well for one it revolves, it's circular shape reflects the continuous and iterative nature of our work, but also because it is revolutionary. I am challenging a 60 year old model that is embedded into our daily language. I don't expect Gartner to build a magic quadrant around this tomorrow, but that would be super cool. And you should call me my mission with. This is to challenge the status quo to create a model that I think more accurately reflects the complexity of modern cloud native software development. The revolution model is constructed of five concentric circles describing the critical roles of software development architect. Ng development, automating, deploying and operating intersecting each loop are six spokes that describe the production considerations every engineer has to consider throughout any engineering work and that's test, ability, secure ability, reliability, observe ability, flexibility and scalability. The considerations listed are not all encompassing. There are of course things not explicitly included. I figured if I put 20 spokes, some of us, including myself, might feel a little overwhelmed. So let's dive into each element in this model. We have long used personas as the default way to do divide audiences and tailor messages to group people. Every company in the world right now is repeating the mantra of developers, developers, developers but personas have always bugged me a bit because this approach typically either oversimplifies someone's career are needlessly complicated. Few people fit cleanly and completely into persona based buckets like developers and operations anymore. The lines have gotten fuzzy on the other hand, I don't think we need to specifically tailor messages as to call out the difference between a devops engineer and a release engineer or a security administrator versus a security engineer but perhaps most critically, I believe personas are immutable. A persona is wholly dependent on how someone identifies themselves. It's intrinsic not extrinsic. Their titles may change their jobs may differ, but they're probably still selecting the same persona on that ubiquitous drop down. We all have to choose from when registering for an event. Probably this one too. I I was a developer and I will always identify as a developer despite doing a ton of work in areas like devops and Ai Ops and Deverell in my heart. I'm a developer I think about problems from that perspective. First it influences my thinking and my approach roles are very different. Roles are temporary, inconsistent, constantly fluctuating. If I were an actress, the parts I would play would be lengthy and varied, but the persona I would identify as would remain an actress and artist lesbian. Your work isn't confined to a single set of skills. It may have been a decade ago, but it is not today in any given week or sprint, you may play the role of an architect. Thinking about how to design a feature or service, developer building out code or fixing a bug and on automation engineer, looking at how to improve manual processes. We often refer to as soil release engineer, deploying code to different environments or releasing it to customers or in operations. Engineer ensuring an application functions inconsistent expected ways and no matter what role we play. We have to consider a number of issues. The first is test ability. All software systems require testing to assure architects that designs work developers, the code works operators, that infrastructure is running as expected and engineers of all disciplines that code changes won't bring down the whole system testing in its many forms is what enables systems to be durable and have longevity. It's what reassures engineers that changes won't impact current functionality. A system without tests is a disaster waiting to happen, which is why test ability is first among equals at this particular roundtable. Security is everyone's responsibility. But if you understand how to design and execute secure systems, I struggle with this security incidents for the most part are high impact, low probability events. The really big disasters, the one that the ones that end up on the news and get us all free credit reporting for a year. They don't happen super frequently and then goodness because you know that there are endless small vulnerabilities lurking in our systems. Security is something we all know we should dedicate time to but often don't make time for. And let's be honest, it's hard and complicated and a little scary def sec apps. The first derivative of deVOPS asked engineers to move security left this approach. Mint security was a consideration early in the process, not something that would block release at the last moment. This is also the consideration under which I'm putting compliance and governance well not perfectly aligned. I figure all the things you have to call lawyers for should just live together. I'm kidding. But in all seriousness, these three concepts are really about risk management, identity, data, authorization. It doesn't really matter what specific issue you're speaking about, the question is who has access to what win and how and that is everyone's responsibility at every stage site reliability engineering or sorry, is a discipline job and approach for good reason. It is absolutely critical that applications and services work as expected. Most of the time. That said, availability is often mistakenly treated as a synonym for reliability. Instead, it's a single aspect of the concept if a system is available but customer data is inaccurate or out of sync. The system is not reliable, reliability has five key components, availability, latency, throughput. Fidelity and durability, reliability is the end result. But resiliency for me is the journey the action engineers can take to improve reliability, observe ability is the ability to have insight into an application or system. It's the combination of telemetry and monitoring and alerting available to engineers and leadership. There's an aspect of observe ability that overlaps with reliability, but the purpose of observe ability isn't just to maintain a reliable system though, that is of course important. It is the capacity for engineers working on a system to have visibility into the inner workings of that system. The concept of observe ability actually originates and linear dynamic systems. It's defined as how well internal states of a system can be understood based on information about its external outputs. If it is critical when companies move systems to the cloud or utilize managed services that they don't lose visibility and confidence in their systems. The shared responsibility model of cloud storage compute and managed services require that engineering teams be able to quickly be alerted to identify and remediate issues as they arise. Flexible systems are capable of adapting to meet the ever changing needs of the customer and the market segment, flexible code bases absorb new code smoothly. Embody a clean separation of concerns. Are partitioned into small components or classes and architected to enable the now as well as the next inflexible systems. Change dependencies are reduced or eliminated. Database schemas accommodate change well components, communicate via a standardized and well documented A. P. I. The only thing constant in our industry is change and every role we play, creating flexibility and solutions that can be flexible that will grow as the applications grow is absolutely critical. Finally, scalability scalability refers to more than a system's ability to scale for additional load. It implies growth scalability and the revolution model carries the continuous innovation of a team and the byproducts of that growth within a system. For me, scalability is the most human of the considerations. It requires each of us in our various roles to consider everyone around us, our customers who use the system or rely on its services, our colleagues current and future with whom we collaborate and even our future selves. Mhm. Software development isn't a straight line, nor is it a perfect loop. It is an ever changing complex dance. There are twirls and pivots and difficult spins forward and backward. Engineers move in parallel, creating truly magnificent pieces of art. We need a modern model for this modern era and I believe this is just the revolution to get us started. Thank you so much for having me. >>Hey, we're back here. Live in the keynote studio. I'm john for your host here with lisa martin. David lot is getting ready for the fireside chat ending keynote with the practitioner. Hello! Fresh without data mesh lisa Emily is amazing. The funky artwork there. She's amazing with the talk. I was mesmerized. It was impressive. >>The revolution of devops and the creative element was a really nice surprise there. But I love what she's doing. She's challenging the status quo. If we've learned nothing in the last year and a half, We need to challenge the status quo. A model from the 1960s that is no longer linear. What she's doing is revolutionary. >>And we hear this all the time. All the cube interviews we do is that you're seeing the leaders, the SVP's of engineering or these departments where there's new new people coming in that are engineering or developers, they're playing multiple roles. It's almost a multidisciplinary aspect where you know, it's like going into in and out burger in the fryer later and then you're doing the grill, you're doing the cashier, people are changing roles or an architect, their test release all in one no longer departmental, slow siloed groups. >>She brought up a great point about persona is that we no longer fit into these buckets. That the changing roles. It's really the driver of how we should be looking at this. >>I think I'm really impressed, really bold idea, no brainer as far as I'm concerned, I think one of the things and then the comments were off the charts in a lot of young people come from discord servers. We had a good traction over there but they're all like learning. Then you have the experience, people saying this is definitely has happened and happening. The dominoes are falling and they're falling in the direction of modernization. That's the key trend speed. >>Absolutely with speed. But the way that Emily is presenting it is not in a brash bold, but it's in a way that makes great sense. The way that she creatively visually lined out what she was talking about Is amenable to the folks that have been doing this for since the 60s and the new folks now to really look at this from a different >>lens and I think she's a great setup on that lightning top of the 15 companies we got because you think about sis dig harness. I white sourced flamingo hacker one send out, I oh, okay. Thought spot rock set Sarah Ops ramp and Ops Monte cloud apps, sani all are doing modern stuff and we talked to them and they're all on this new wave, this monster wave coming. What's your observation when you talk to these companies? >>They are, it was great. I got to talk with eight of the 15 and the amount of acceleration of innovation that they've done in the last 18 months is phenomenal obviously with the power and the fuel and the brand reputation of aws but really what they're all facilitating cultural shift when we think of devoPS and the security folks. Um, there's a lot of work going on with ai to an automation to really kind of enabled to develop the develops folks to be in control of the process and not have to be security experts but ensuring that the security is baked in shifting >>left. We saw that the chat room was really active on the security side and one of the things I noticed was not just shift left but the other groups, the security groups and the theme of cultural, I won't say war but collision cultural shift that's happening between the groups is interesting because you have this new devops persona has been around Emily put it out for a while. But now it's going to the next level. There's new revolutions about a mindset, a systems mindset. It's a thinking and you start to see the new young companies coming out being funded by the gray locks of the world who are now like not going to be given the we lost the top three clouds one, everything. there's new business models and new technical architecture in the cloud and that's gonna be jerry Chen talk coming up next is going to be castles in the clouds because jerry chant always talked about moats, competitive advantage and how moats are key to success to guard the castle. And then we always joke, there's no more moz because the cloud has killed all the boats. But now the motor in the cloud, the castles are in the cloud, not on the ground. So very interesting thought provoking. But he's got data and if you look at the successful companies like the snowflakes of the world, you're starting to see these new formations of this new layer of innovation where companies are growing rapidly, 98 unicorns now in the cloud. Unbelievable, >>wow, that's a lot. One of the things you mentioned, there's competitive advantage and these startups are all fueled by that they know that there are other companies in the rear view mirror right behind them. If they're not able to work as quickly and as flexibly as a competitor, they have to have that speed that time to market that time to value. It was absolutely critical. And that's one of the things I think thematically that I saw along the eighth sort of that I talked to is that time to value is absolutely table stakes. >>Well, I'm looking forward to talking to jerry chan because we've talked on the queue before about this whole idea of What happens when winner takes most would mean the top 3, 4 cloud players. What happens? And we were talking about that and saying, if you have a model where an ecosystem can develop, what does that look like and back in 2013, 2014, 2015, no one really had an answer. Jerry was the only BC. He really nailed it with this castles in the cloud. He nailed the idea that this is going to happen. And so I think, you know, we'll look back at the tape or the videos from the cube, we'll find those cuts. But we were talking about this then we were pontificating and riffing on the fact that there's going to be new winners and they're gonna look different as Andy Jassy always says in the cube you have to be misunderstood if you're really going to make something happen. Most of the most successful companies are misunderstood. Not anymore. The cloud scales there. And that's what's exciting about all this. >>It is exciting that the scale is there, the appetite is there the appetite to challenge the status quo, which is right now in this economic and dynamic market that we're living in is there's nothing better. >>One of the things that's come up and and that's just real quick before we bring jerry in is automation has been insecurity, absolutely security's been in every conversation, but automation is now so hot in the sense of it's real and it's becoming part of all the design decisions. How can we automate can we automate faster where the keys to automation? Is that having the right data, What data is available? So I think the idea of automation and Ai are driving all the change and that's to me is what these new companies represent this modern error where AI is built into the outcome and the apps and all that infrastructure. So it's super exciting. Um, let's check in, we got jerry Chen line at least a great. We're gonna come back after jerry and then kick off the day. Let's bring in jerry Chen from Greylock is he here? Let's bring him in there. He is. >>Hey john good to see you. >>Hey, congratulations on an amazing talk and thesis on the castles on the cloud. Thanks for coming on. >>All right, Well thanks for reading it. Um, always were being put a piece of workout out either. Not sure what the responses, but it seemed to resonate with a bunch of developers, founders, investors and folks like yourself. So smart people seem to gravitate to us. So thank you very much. >>Well, one of the benefits of doing the Cube for 11 years, Jerry's we have videotape of many, many people talking about what the future will hold. You kind of are on this early, it wasn't called castles in the cloud, but you were all I was, we had many conversations were kind of connecting the dots in real time. But you've been on this for a while. It's great to see the work. I really think you nailed this. I think you're absolutely on point here. So let's get into it. What is castles in the cloud? New research to come out from Greylock that you spearheaded? It's collaborative effort, but you've got data behind it. Give a quick overview of what is castle the cloud, the new modes of competitive advantage for companies. >>Yeah, it's as a group project that our team put together but basically john the question is, how do you win in the cloud? Remember the conversation we had eight years ago when amazon re event was holy cow, Like can you compete with them? Like is it a winner? Take all? Winner take most And if it is winner take most, where are the white spaces for Some starts to to emerge and clearly the past eight years in the cloud this journey, we've seen big companies, data breaks, snowflakes, elastic Mongo data robot. And so um they spotted the question is, you know, why are the castles in the cloud? The big three cloud providers, Amazon google and Azure winning. You know, what advantage do they have? And then given their modes of scale network effects, how can you as a startup win? And so look, there are 500 plus services between all three cloud vendors, but there are like 500 plus um startups competing gets a cloud vendors and there's like almost 100 unicorn of private companies competing successfully against the cloud vendors, including public companies. So like Alaska, Mongo Snowflake. No data breaks. Not public yet. Hashtag or not public yet. These are some examples of the names that I think are winning and watch this space because you see more of these guys storm the castle if you will. >>Yeah. And you know one of the things that's a funny metaphor because it has many different implications. One, as we talk about security, the perimeter of the gates, the moats being on land. But now you're in the cloud, you have also different security paradigm. You have a different um, new kinds of services that are coming on board faster than ever before. Not just from the cloud players but From companies contributing into the ecosystem. So the combination of the big three making the market the main markets you, I think you call 31 markets that we know of that probably maybe more. And then you have this notion of a sub market, which means that there's like we used to call it white space back in the day, remember how many whites? Where's the white space? I mean if you're in the cloud, there's like a zillion white spaces. So talk about this sub market dynamic between markets and that are being enabled by the cloud players and how these sub markets play into it. >>Sure. So first, the first problem was what we did. We downloaded all the services for the big three clowns. Right? And you know what as recalls a database or database service like a document DB and amazon is like Cosmo dB and Azure. So first thing first is we had to like look at all three cloud providers and you? Re categorize all the services almost 500 Apples, Apples, Apples # one number two is you look at all these markets or sub markets and said, okay, how can we cluster these services into things that you know you and I can rock right. That's what amazon Azure and google think about. It is very different and the beauty of the cloud is this kind of fat long tail of services for developers. So instead of like oracle is a single database for all your needs. They're like 20 or 30 different databases from time series um analytics, databases. We're talking rocks at later today. Right. Um uh, document databases like Mongo search database like elastic. And so what happens is there's not one giant market like databases, there's a database market And 30, 40 sub markets that serve the needs developers. So the Great News is cloud has reduced the cost and create something that new for developers. Um also the good news is for a start up you can find plenty of white speeds solving a pain point, very specific to a different type of problem >>and you can sequence up to power law to this. I love the power of a metaphor, you know, used to be a very thin neck note no torso and then a long tail. But now as you're pointing out this expansion of the fat tail of services, but also there's big tam's and markets available at the top of the power law where you see coming like snowflake essentially take on the data warehousing market by basically sitting on amazon re factoring with new services and then getting a flywheel completely changing the economic unit economics completely changing the consumption model completely changing the value proposition >>literally you >>get Snowflake has created like a storm, create a hole, that mode or that castle wall against red shift. Then companies like rock set do your real time analytics is Russian right behind snowflakes saying, hey snowflake is great for data warehouse but it's not fast enough for real time analytics. Let me give you something new to your, to your parallel argument. Even the big optic snowflake have created kind of a wake behind them that created even more white space for Gaza rock set. So that's exciting for guys like me and >>you. And then also as we were talking about our last episode two or quarter two of our showcase. Um, from a VC came on, it's like the old shelf where you didn't know if a company's successful until they had to return the inventory now with cloud you if you're not successful, you know it right away. It's like there's no debate. Like, I mean you're either winning or not. This is like that's so instrumented so a company can have a good better mousetrap and win and fill the white space and then move up. >>It goes both ways. The cloud vendor, the big three amazon google and Azure for sure. They instrument their own class. They know john which ecosystem partners doing well in which ecosystems doing poorly and they hear from the customers exactly what they want. So it goes both ways they can weaponize that. And just as well as you started to weaponize that info >>and that's the big argument of do that snowflake still pays the amazon bills. They're still there. So again, repatriation comes back, That's a big conversation that's come up. What's your quick take on that? Because if you're gonna have a castle in the cloud, then you're gonna bring it back to land. I mean, what's that dynamic? Where do you see that compete? Because on one hand is innovation. The other ones maybe cost efficiency. Is that a growth indicator slow down? What's your view on the movement from and to the cloud? >>I think there's probably three forces you're finding here. One is the cost advantage in the scale advantage of cloud so that I think has been going for the past eight years, there's a repatriation movement for a certain subset of customers, I think for cost purposes makes sense. I think that's a tiny handful that believe they can actually run things better than a cloud. The third thing we're seeing around repatriation is not necessary against cloud, but you're gonna see more decentralized clouds and things pushed to the edge. Right? So you look at companies like Cloudflare Fastly or a company that we're investing in Cato networks. All ideas focus on secure access at the edge. And so I think that's not the repatriation of my own data center, which is kind of a disaggregated of cloud from one giant monolithic cloud, like AWS east or like a google region in europe to multiple smaller clouds for governance purposes, security purposes or legacy purposes. >>So I'm looking at my notes here, looking down on the screen here for this to read this because it's uh to cut and paste from your thesis on the cloud. The excellent cloud. The of the $38 billion invested this quarter. Um Ai and ml number one, um analytics. Number two, security number three. Actually, security number one. But you can see the bubbles here. So all those are data problems I need to ask you. I see data is hot data as intellectual property. How do you look at that? Because we've been reporting on this and we just started the cube conversation around workflows as intellectual property. If you have scale and your motives in the cloud. You could argue that data and the workflows around those data streams is intellectual property. It's a protocol >>I believe both are. And they just kind of go hand in hand like peanut butter and jelly. Right? So data for sure. I. P. So if you know people talk about days in the oil, the new resource. That's largely true because of powers a bunch. But the workflow to your point john is sticky because every company is a unique snowflake right? Like the process used to run the cube and your business different how we run our business. So if you can build a workflow that leverages the data, that's super sticky. So in terms of switching costs, if my work is very bespoke to your business, then I think that's competitive advantage. >>Well certainly your workflow is a lot different than the cube. You guys just a lot of billions of dollars in capital. We're talking to all the people out here jerry. Great to have you on final thought on your thesis. Where does it go from here? What's been the reaction? Uh No, you put it out there. Great love the restart. Think you're on point on this one. Where did we go from here? >>We have to follow pieces um in the near term one around, you know, deep diver on open source. So look out for that pretty soon and how that's been a powerful strategy a second. Is this kind of just aggregation of the cloud be a Blockchain and you know, decentralized apps, be edge applications. So that's in the near term two more pieces of, of deep dive we're doing. And then the goal here is to update this on a quarterly and annual basis. So we're getting submissions from founders that wanted to say, hey, you missed us or he screwed up here. We got the big cloud vendors saying, Hey jerry, we just lost his new things. So our goal here is to update this every single year and then probably do look back saying, okay, uh, where were we wrong? We're right. And then let's say the castle clouds 2022. We'll see the difference were the more unicorns were there more services were the IPO's happening. So look for some short term work from us on analytics, like around open source and clouds. And then next year we hope that all of this forward saying, Hey, you have two year, what's happening? What's changing? >>Great stuff and, and congratulations on the southern news. You guys put another half a billion dollars into early, early stage, which is your roots. Are you still doing a lot of great investments in a lot of unicorns. Congratulations that. Great luck on the team. Thanks for coming on and congratulations you nailed this one. I think I'm gonna look back and say that this is a pretty seminal piece of work here. Thanks for sharing. >>Thanks john thanks for having us. >>Okay. Okay. This is the cube here and 81 startup showcase. We're about to get going in on all the hot companies closing out the kino lisa uh, see jerry Chen cube alumni. He was right from day one. We've been riffing on this, but he nails it here. I think Greylock is lucky to have him as a general partner. He's done great deals, but I think he's hitting the next wave big. This is, this is huge. >>I was listening to you guys talking thinking if if you had a crystal ball back in 2013, some of the things Jerry saying now his narrative now, what did he have a crystal >>ball? He did. I mean he could be a cuBA host and I could be a venture capital. We were both right. I think so. We could have been, you know, doing that together now and all serious now. He was right. I mean, we talked off camera about who's the next amazon who's going to challenge amazon and Andy Jassy was quoted many times in the queue by saying, you know, he was surprised that it took so long for people to figure out what they were doing. Okay, jerry was that VM where he had visibility into the cloud. He saw amazon right away like we did like this is a winning formula and so he was really out front on this one. >>Well in the investments that they're making in these unicorns is exciting. They have this, this lens that they're able to see the opportunities there almost before anybody else can. And finding more white space where we didn't even know there was any. >>Yeah. And what's interesting about the report I'm gonna dig into and I want to get to him while he's on camera because it's a great report, but He says it's like 500 services I think Amazon has 5000. So how you define services as an interesting thing and a lot of amazon services that they have as your doesn't have and vice versa, they do call that out. So I find the report interesting. It's gonna be a feature game in the future between clouds the big three. They're gonna say we do this, you're starting to see the formation, Google's much more developer oriented. Amazon is much more stronger in the governance area with data obviously as he pointed out, they have such experience Microsoft, not so much their developer cloud and more office, not so much on the government's side. So that that's an indicator of my, my opinion of kind of where they rank. So including the number one is still amazon web services as your long second place, way behind google, right behind Azure. So we'll see how the horses come in, >>right. And it's also kind of speaks to the hybrid world in which we're living the hybrid multi cloud world in which many companies are living as companies to not just survive in the last year and a half, but to thrive and really have to become data companies and leverage that data as a competitive advantage to be able to unlock the value of it. And a lot of these startups that we talked to in the showcase are talking about how they're helping organizations unlock that data value. As jerry said, it is the new oil, it's the new gold. Not unless you can unlock that value faster than your competition. >>Yeah, well, I'm just super excited. We got a great day ahead of us with with all the cots startups. And then at the end day, Volonte is gonna interview, hello, fresh practitioners, We're gonna close it out every episode now, we're going to do with the closing practitioner. We try to get jpmorgan chase data measures. The hottest area right now in the enterprise data is new competitive advantage. We know that data workflows are now intellectual property. You're starting to see data really factoring into these applications now as a key aspect of the competitive advantage and the value creation. So companies that are smart are investing heavily in that and the ones that are kind of slow on the uptake are lagging the market and just trying to figure it out. So you start to see that transition and you're starting to see people fall away now from the fact that they're not gonna make it right, You're starting to, you know, you can look at look at any happens saying how much ai is really in there. Real ai what's their data strategy and you almost squint through that and go, okay, that's gonna be losing application. >>Well the winners are making it a board level conversation >>And security isn't built in. Great to have you on this morning kicking it off. Thanks John Okay, we're going to go into the next set of the program at 10:00 we're going to move into the breakouts. Check out the companies is three tracks in there. We have an awesome track on devops pure devops. We've got the data and analytics and we got the cloud management and just to run down real quick check out the sis dig harness. Io system is doing great, securing devops harness. IO modern software delivery platform, White Source. They're preventing and remediating the rest of the internet for them for the company's that's a really interesting and lumbago, effortless acres land and monitoring functions, server list super hot. And of course hacker one is always great doing a lot of great missions and and bounties you see those success continue to send i O there in Palo alto changing the game on data engineering and data pipe lining. Okay. Data driven another new platform, horizontally scalable and of course thought spot ai driven kind of a search paradigm and of course rock set jerry Chen's companies here and press are all doing great in the analytics and then the cloud management cost side 80 operations day to operate. Ops ramps and ops multi cloud are all there and sunny, all all going to present. So check them out. This is the Cubes Adria's startup showcase episode three.

>>let's bring in jerry Chen from Greylock is he here? Let's bring him in there? He is. >>Hey john good to see you. >>Hey congratulations on an amazing talk and thesis on the castles on the cloud. Thanks for coming on. >>All right, well thanks for reading it. Um, always were being put a piece of work out out of the ether, not sure what the responses, but it seemed to resonate with a bunch of developers, founders, investors and folks like yourself. So smart people seem to gravitate to us. So thank you very much. >>Well, one of the benefits of doing the Cube for 11 years, Jerry's, we have videotape of many, many people talking about what the future will hold. You kind of are on this early, it wasn't called castles in the cloud, but you were all, I was, we had many conversations were kind of connecting the dots in real time, but you've been on this for a while it's great to see the work. I really think you nailed this. I think you're absolutely on point here. So let's get into it. What is castles in the cloud? New research come out from Greylock that you spearheaded? It's collaborative effort, but you've got data behind it. Give a quick overview of what is castle the cloud, The new modes of competitive advantage for companies. >>Yeah, it's as a group project that our team put together but basically john the question is how do you win in the cloud? Remember the conversation we had eight years ago when amazon re event was holy cow like can you compete with them? Like is it a winner? Take all, Winner take most. And if it is winner take most. Where are the white spaces for some starts to to emerge clearly the past eight years in the cloud this journey we've seen big companies data breaks, snowflakes, elastic mongo data robot. And so um they spotted the question is you know, why are the castles in the cloud? The big three cloud providers amazon google and as you're winning, you know, what advantage do they have? And then given their modes of scale network effects, how can you as a startup win? And so look, there are 500 plus services between all three cloud vendors but there are like 500 plus um startups, competing gets a cloud vendors and there's like almost 100 unicorn of private companies competing successfully against the cloud vendors, including public companies. So like Alaska Mongo snowflake, No data breaks. Not public yet. Hashtag or not public yet. These are some examples of the names that I think are winning and watch this space because you see more of these guys storm the castle if you will. >>Yeah. And you know one of the things that's a funny metaphor because it has many different implications. One, as we talk about security, the perimeter of the gates, the most being on land, but now you're in the cloud, you have also different security paradigm. You have a different um new kinds of services that are coming on board faster than ever before, not just from the cloud players, but from companies contributing into the ecosystem. So the combination of the big three making the market the main markets, you, I think you call it 31 markets that we know of that probably maybe more. And then you have this notion of sub market, which means that there's like, we used to call it white space back in the day. Remember how many whites? Where's the white space? I mean if you're in the cloud there's like a zillion white spaces. So talk about this sub market dynamic between markets and that are being enabled by the cloud players and how these sub markets play into it. >>Sure. So first, the first problem was what we did, we downloaded all the services for the big three clowns. Right. And you know what as recalls a database or database service, like a document dB and amazon is like Cosmo, dB and Azure. So first thing first is we had to like look at all three cloud providers and you? Re categorize all the services almost 500 Apples, Apples, Apples, # one. Number two, is you look at all these markets or sub markets and said, okay, how can we cluster these services into things that you know, you and I can rock. Right, That's what amazon as well. And google think about it is very different. And the beauty of the cloud is this kind of fat long tail of services for developers. So instead of like oracle as a single database for all your needs, they're like 20 or 30 different databases from time series um, analytics, databases we're talking rocks at later today, right? Um uh, document databases like mongo search database like elastic and so what happens is there's not one giant market like databases, there's a database market and 30 40 sub markets that serve the needs developers. So the Great News is cloud has reduced the cost and create something that new for developers. Um also the good uses for a start up, you can find plenty of white speech solving a pain point very specific to a different type of problem >>and you can sequence up the power law to this. I love the power of a metaphor, you know, used to be a very thin neck note no torso and then a long tail. But now as you're pointing out this expansion of the fat tail of services but also this big tam's and markets available at the top of the power law where you see coming like snowflake essentially take on the data warehousing market by basically sitting on amazon and re factoring with new services and then getting a flywheel completely changing the economic unit economics completely changing the consumption model completely changing the value proposition literally >>you snowflake has created like storm create a hole that mode or that castle wall against red shift. Then companies like rock set real time analytics, It's Russian right behind snowflakes saying, hey snowflake is great for data warehouse, but it's not fast enough for real time analytics. Let me give you something new to your, your parallel argument. Even the big optics snowflake have created kind of a wake behind them that created even more white space for Gaza rock set. So that's exciting for guys like media. >>And then also as we were talking about our last episode two or quarter two of our showcase, um, from a VC came on, it's like the old shelf where you didn't know if a company's successful until they had to return the inventory now with cloud. If you're not successful, you know it right away. It's like, it's like there's no debate. Like, I mean you're either winning or not. This is like that's so instrumented. So a company can have a good better mousetrap and win and fill the white space and then move up. >>It goes both ways. The cloud vendor, the big three amazon google and Azure for sure. They instrument their own class. They know john which ecosystem partners doing well in which ecosystems doing poorly and they hear from the customers exactly what they want. So it goes both ways they can weaponize that just as well as you started to weaponize that info >>and that's the big argument of do that snowflake still pays the amazon bills, they're still there. So again, repatriation comes back. That's a big conversation that's come up. Um, what's your quick take on that? Because if you're gonna have a castle in the cloud, then you're gonna bring it back to land. I mean, what's that dynamic? Where do you see that compete? Because on one hand is innovation, the other ones maybe cost efficiency. Is that a growth indicator? Slow down? What's your view on the movement from and to the cloud? >>I think there's probably three forces you're finding here. One is the cost advantage in the scale advantage of cloud. So that I think has been going for the past eight years. There's a repatriation movement for a certain subset of customers, I think for cost purposes makes sense. I think that's a tiny handful that believe they can actually run things better than a cloud. The third thing we're seeing around repatriation is not necessary against cloud, but you're gonna see more decentralized clouds and things pushed to the edge. Right? So you look at companies like Cloudflare Fastly or a company that we're investing in Cato networks. All ideas focus on secure access at the edge. And so I think that's not repatriation of my own data center, but it's kind of a disaggregated of cloud from one giant monolithic cloud, like AWS East or like a google region in europe to multiple smaller clouds for governance purposes, security purposes or legacy purposes. >>So I'm looking at my notes here, looking down on the screen here for this to read this because it's uh to cut and paste from your thesis on the cloud, the cloud. The of the $38 billion invested uh this quarter. Um uh Ai and ml number one um analytics number two, security number three. Actually security number one. But you can see the bubbles here. So all those are data problems I need to ask you. I see data is hot data as intellectual property. How do you look at that? Because we've been reporting on this and we just started the cube conversation around workflows as intellectual property. If you have scale and your motives in the cloud, you could argue that data and the workflows around those data streams is intellectual property, it's a protocol. >>I believe both are. And they just kind of go hand in hand like peanut butter and jelly. Right? So data for sure. I p So if you know people talk about days in the oil, the new resource. That's largely true because the powers a bunch. But the workflow to your point john is sticky because every company is a unique snowflake, right? Like the process used to run the cube and your business different how we run our business. So if you can build a workflow that leverages the data that's super sticky. So in terms of switching costs, if my work is very bespoke to your business then I think that's competitive advantage. >>Well certainly your workflow is a lot different than the cube. You guys. Just a lot of billions of dollars in capital. Uh, we're talking to all the people out here jerry. Great to have you on final thought on your thesis. Where does it go from here? What's been the reaction? Uh, no, you put it out there. Great, love the research. I think you're on point on this one. Where did, where's it go from here? >>We have to follow pieces. Um, in the near term one around, you know, deep diver on open source. So look out for that pretty soon. And how that's been a powerful strategy a second is this kind of disaggregated of the cloud be a Blockchain and you know, decentralized apps, be edge applications. So that's in the near term two more pieces of, of deep dive we're doing. And then the goal here is to update this on a quarterly and annual basis. So we're getting submissions from founders that wanted to say, hey, you missed us Or he screwed up here. We got the big cloud vendors saying, Hey jerry, we just lost his new things. So our goal here is to update this every single year and then probably do look back saying, okay, uh, were we wrong? We're right. And then let's say the castle clouds 2022 we'll see the difference were the more unicorns, were there more services were the IPO's happening. So look for some short term work from us on analytics, like around open source and clouds. And then next year we hope that all this forward saying, Hey, you have two year, what's happening? What's changing? >>Great stuff And, and congratulations on the Southern news. You guys put another half a billion dollars into early, early stage, which is your roots. Are you still doing a lot of great investments in a lot of unicorns? Congratulations that great luck on the team. Thanks for coming on And congratulations. You nailed this one. I think I'm gonna look back and say that this is a pretty seminal piece of work here. Thanks for for sharing. >>Thanks john, Thanks for having me as >>always.

>> Narrator: From around the globe. It's theCUBE covering Data Citizens, 21 brought to you by Collibra. >> Hi everybody, John Walls here on theCUBE continuing our coverage of Data Citizens 2021. And I'm with now Kirk Haslbeck was the vice president of engineering at Collibra. Kirk joins us from his home, Kirk good to see you today. Thanks for joining us here on theCUBE. >> Well, thanks for having me, I'm excited to be here. >> Yeah, no, this is all about data quality, right? That's your world, you know, making sure that you're making the most of this great asset, right? That continues to evolve and mature. And yet I'm wondering from your perspective from your side of the fence, I assume data quality has always been a concern, right? Making the most of this asset, wherever it is. And whenever you can get it. >> Yeah, absolutely. I mean, the challenge hasn't slowed down, right? We're looking at more data coming in all the time laws of large numbers, but you kind of have to wonder a lot of the large organizations have been trying to solve this for quite some time, right? So what is going on? Why isn't it just easier to get our arms around it? And there's so many reasons, but if I were to list maybe the top one it's the diminishing value of static rules and a good example of that might just be something as simple as starting with a gender column. And back in the day, we might have assumed that it had to be an M or an F male or female. And over the last couple of years, we've actually seen that column evolve into six or seven different types. So just the very act of assuming that we could go in and write rules about our business and that they're never going to change and that the data's not evolving. And we start to think about zip codes and addresses that are changing, you know, Google street view. However you want to think of it. Every column and every record is just changing all the time. And so what, you know, many large organizations have done they've written maybe forty thousand, fifty thousand rules and they have to continue to manage them. So I think we all try to get our arms around rule creation. And it's not even just about that. It would also be about if you had all the rules in place could you even keep up with them on a day-to-day changing basis? And so one of the largest companies in the U.S sat down with myself and team early on and said, so what am I up against? I'm really either going to continue to hire a mountain of rule writers, you know, as they put it per department to get my arms around this and that'll never end, or I need to think of a better way which was the solution that we were ultimately providing at that time. And, you know, and what that solution really entails is using data mining to learn and observe all the data that's already there and to curate the rules based on the data itself, right? That's where all the information is. And then ultimately we have this concept of adaptive ruling which means all the variants in that column all the new values that come in every day, the roll counts, the sizes are all being managed. It's an automatic program, so that the rule is recalibrating itself and I think this is where most most chief data officers sit back and say if I have to protect the franchise, right? If I have to put a trusted data program in place what are my options and how does it scale? And they have to take a really hard look at something like this. >> You know, the process that you're talking about too it just kind of reminds me of, of like, of a diet in that nobody wants to go through that pain, right? We all want to eat, what we want to eat but you're really happy when you get there at the end of the day, you like the way you look like the way you feel, like the way you act, all those things, so it'd be almost like when you're talking about in terms of this data, you know, in terms of a rule setting, right? Governance and accessibility and all these things, it's, it can be a tough process. Can be, but it certainly seems well worth it because you make your data all the more valuable and essential to your business, Is that about right? >> Yeah, that's right, that's right. And you know, it's funny you compare it to a diet. Sometimes I think of a patient stress test, you know, almost like a health exam and we're spending so much time testing the analytics or testing the models and looking at accuracy and can anybody achieve 89 to 90% but we're probably not spending enough time testing our data assumptions, right? Running that diet or health check against the data itself. And I would say that every fortune 100 or even fortune 1000 probably considers themselves a data-driven business at this point in time, which means they're going to make decisions quickly based on data. And if we really pull that thread a little bit, what about what's the cost of making decisions on incorrect data? I mean it's terribly scary as we start to unfold that, so you're absolutely right. They're taking it very seriously. And it takes a lot of thought of how to get enough coverage and how to create trust in that type of environment. >> Yeah, it's almost too, it's like, you know the concept of input bias a little bit here where were if you're assuming that certain data sets are accurate and pertinent, relevant, all those things and then you're making decisions based on those data sets but you might be looking at kind of an input bias if I'm hearing you right, that you're maybe you're not keeping your mind open as to what really should be important or influential in your decision-making in terms of data. And then obviously acting on that appropriately. So you have to decide maybe on the front side, you know, what data matters and you help people do that. And then help me make decisions based on good data basically, right? >> Right, that's right and to be fully transparent and candid we weren't as strong in the what data matters piece of it. We were very strong early on in giving you broad coverage meaning we made no assumptions, right? We wanted to go out and attack the whole surface of the problem and then sort of have a consistent scoring methodology. And as we've partnered and now become acquired by Collibra which is an exciting path, they are very good at what's called critical data elements and lineage and doing graph analysis to sort of identify the assets that are most used. And that's where we see a huge benefit in combining those two powers. So you kind of got there quickly, but ultimately we are combining the forces of total coverage at scale with what is most important to you. >> Imagine we coming OwlDQ, you were the founder of that, that was purchased by Collibra. Tell us a little bit about, just about how that came to be in first off, we did a OwlDQ, what that was all about and then how this, this a marriage, if you will how this relationship with Collibra evolved and then you were eventually purchased. >> Yeah, absolutely, so, I mean, I had this passion that I couldn't hold back on in the data community. Once you see it this way, where you can use data mining and compute power to curate and manage rules and then take it much beyond there and to predicting and seeing around the corner for tomorrow, you have to go that direction. So that's exactly what myself and team did. And what we started to see with the early adopters of our software was that they were getting a seven figure return on investment per department. And they were able to replicate this across many departments, so we've had a great lifespan with those customers, staying and growing and expanding but we were getting a little bit of market pressure from the investment community, as well as that same customer community that they wanted us to integrate with their data catalog and the data catalog of choice. Every time the conversation was Collibra. And interestingly enough, you know, I ran into the likes of Jim Cushman and in the, you know, the whole thing unfolds from there. I think they were seeing a little bit of a similar story saying doesn't catalog and lineage belong together with quality. And when we sat together it was like three market forces suggesting the same answer. And as we laid out the roadmap and the integration we just can't see it any other way. There's no way I'll be bold and say that it goes back the other way, not just for this company but for the industry, data governance and data intelligence will absolutely combine quality, lineage, catalog and all of the above in the future. It is becoming that clear, I think. >> You know, this has kind of a big picture question, about all of that data quality right now, what's driving this avid interest that organizations showing and it's you know, small, medium enterprise it's everybody but in your mind, you know, you've been involved in this for a number of years now. You know, why now, what is it now? Is it just that we have so much more data available that so much of it's own use that, that, you know, we know what we have. And we're realizing that what we have is pretty valuable but you know, what's the driver, what's the big push here? >> Yeah, it is a tough question. And I have gotten this one before and it's interesting because it's been around since the nineties, right? So it's a very fair question. There's a couple things I think that are driving it. One as we start to see more data in Tableau dashboards and pick your favorite BI tool you start to realize the data's not correct. You know, you look at your house on Zillow or whatever you find out it's mislabeled. It doesn't have the right bedrooms. Maybe humans are entering into the listings and as data's become more available visually we're more critical of it. And now businesses are becoming more data-driven where they're humans aren't involved as much and the actions are automatically being taken. And it becomes an embarrassing moment if your data is incorrect and we can really measure that cost at this point. You do see some other factors like cloud migration. Well, that adds a risk to your business. Could you possibly port everything, not just the servers not just the software, but all of your data into another system and think that there would be no errors in that process. So as people are kind of creating their next generation platforms, and then probably even a touch of COVID accelerating that cloud migration adoption and even just technology adoption. So for a multitude of reasons, there's just more data and there's more data quality concerns than ever before. >> So if you're talking to a prospective client right now, which you probably are, you know, what do you want to share with them? Or what would you encourage them to consider in terms of kind of their data venture their data journey if you will, in terms of, you know, refining what they have in terms of mining appropriately in terms of governing it appropriately, all these things that maybe haven't been given a lot of consideration or deep consideration. >> Yeah, I think the two things although if you listen to my other talks I can talk forever about, about all of those items. It probably, you know, maybe just do the napkin math of all the tables, all the files all the Kafka messages, right? All the columns and fields and attributes and kind of just multiply that out and and try to figure out how you would get coverage. And if you could, how you could maintain it. And why shouldn't we be trading compute power for domain knowledge and things at that point I think that's the first place to start. And probably the second is actually the act of traditional data quality rules puts you in a binary situation. It basically says you will either have a break record or you will not. So it's a yes, no question, what it never will tell you is what the answer should have been. And if you take a deeper look at the solution that we're providing to the market we're actually predicting to you what the correct value is and it's a complete paradigm shift it obviously is much more scientific, but it's much more powerful to get you to the end answer more quickly instead of just going through break records. >> Right? Tremendous capability that you just described. And on that, I'm going to thank you for the time but just think about it, right? We're we're not only going to help you make more sense of your data. We're also going to help you make better decisions and show you what that path might be or what you probably should be considering. So it certainly opens up a lot of doors for a lot of companies in that respect. Kirk, thanks for the time, sorry we didn't have enough time to hear that guitar in the background, but next time I'm going to hold you to it, okay. >> Yeah, that sounds good, John, I really appreciate it. >> All right very good Kirk Haslbeck joining us from Collibra, we continue our coverage here at Data Citizens 21 on theCUBE and I'm John Walls. (bright music)

>> Voiceover: From around the globe, it's theCUBE, with coverage of Kubecon and CloudNativeCon, North America, 2020, virtual brought to you by Red Hat, the Cloud Native Computing Foundation and Ecosystem Partners. >> Welcome back to theCUBE's coverage, virtual coverage of Kubecon and CloudNativeCon 2020. We're not in person this year, normally we're there in person. We have to do remote because of the pandemic, but hey, it opens up more conversations. And this is theCUBE virtual. I'm John Furrier, your host. And you'll see a lot of interviews. We've got some great guests, Talking to the leaders, the developers, the end users, as well as the vendors with the CNCF, we got two great guests, Priyanka Sharma, the General Manager of the CNCF, great to see you and Stephen Augustus OSS Engineer at VMware. He's also the KubeCon co-chair back on the cube. Thanks for coming on folks. I appreciate it. >> Thank you for having us. So, thanks for coming on, actually, remote and virtual. We're doing a lot of interviews, we're getting some perspectives, people are chatting in Slack. It's still got the hallway vibe feel, a lot of talks, a lot of action, keynotes happening, but I think the big story for me, and I would like to talk about, I want to get your perspective is this new working group that's out there. So I know there's some news around it. Could you take a minute to explain kind of what this is all about? >> Sure. I'll give a little bit of context for those who may have missed my keynote which... very bad. (Priyanka laughs) As I announced, I'm so proud to be working with the likes of Stephen Augustus here, and a bunch of other folks from different companies, different open source projects, et cetera, to bring inclusive naming to code. I think it's been a forever issue. Quite frankly. We've had many problematic terms in software out there. The most obvious one being master-slave. That really shouldn't be there. That have no place in an inclusive world, inclusive software, inclusive community with the help of amazing people like Stephen, folks from IBM, Red Hat, and many, many others. We came together because while there's a lot of positive enthusiasm and excitement for people to make the changes that are necessary to make the community welcome for all, there's a lot of different work streams happening. And we really wanted to make sure there is a centralized place for guidelines and discussion for everybody in a very non...pan-organizational kind of way. And so that's the working group that John is talking about. With that said, Stephen, I think you can do the best justice to speak to the overall initiative. >> Yeah, absolutely. So I think that's to Priyanka's point, there are lots of people who are interested in this work and again, lots of work where this is already happening, which is very exciting to say, but as any good engineer, I think that's it's important to not duplicate your work. It's important to recognize the efforts that are happening elsewhere and work towards bringing people together. So part of this is providing, being able to provide a forum for discussion for a variety of companies, for a variety of associations that... and foundations that are involved in inclusive naming efforts. And then to also provide a framework for walking people through how we evaluate language and how we make these kinds of changes. As an example, for Kubernetes, we started off the Kubernetes working group naming and the hope for the working group naming was that it was going to evolve into hopefully an effort like this, where we could bring a lot of people on and not just talk about Kubernetes. So since we formed that back in, I want to say, June-ish, we've done some work on about of providing a language evaluation framework, providing templates for recommendations, providing a workflow for moving from just a suggestion into kind of actuating those ideas right and removing that language where it gets tricky and code is thinking about, thinking about, say a Kubernetes API. And in fact that we have API deprecation policies. And that's something that we have to if offensive language is in one of our APIs, we have to work through our deprecation policy to get that done. So lots of moving parts, I'm very excited about the overall effort. >> Yeah, I mean, your mind can explode if you just think about all the complications involved, but I think this is super important. I think the world has voted on this, I think it's pretty obvious and Priyanka, you hit some of the key top-line points, inclusive software. This is kind of the high order bit, but when you get down to it, it's hard as hell to do, because if you want to get ne new namings and/or changing namings accepted by the community and code owners, you're dealing with two things, a polarizing environment around the world today, and two, the hassles involved, which includes duplicate efforts. So you've got kind of a juggling act going on between two forces. So it's a hard problem. So how are you tackling this? Because it's certainly the right thing to do. There's no debate there. How do you make it happen? How do you go in without kind of blowing things up, if you will? And do it in a way that's elegant and clean and accept it. 'Cause that's the... end of the day, it's acceptance and putting it code owners. >> Absolutely. I think so, as you said, we live in a polarizing environment right now. Most of us here though know that this is the right thing to do. Team CloudNative is for everyone. And that is the biggest takeaway I hope people get from our work in this initiative. Open source belongs to everybody and it was built for the problems of today. That's why I've been working on this. Now, when it goes into actual execution, as you said, there are many moving parts, Stephen and the Kubernetes working group, is our shining example and a really good blueprint for many folks to utilize. In addition to that, we have to bring in diverse organizations. It's not just open source projects. It's not just companies. It's also standards organizations. It's also folks who think about language in books, who have literally done PhDs in this subject. And then there are folks who are really struggling through making the changes today and tomorrow and giving them hope and excitement. So that at the end of this journey, not only do you know you've done the right thing, but you'd be recognized for it. And more people will be encouraged by your own experience. So we and the LF have been thinking at it from a holistic perspective, let's bring in the standards bodies, let's bring in the vendors, let's bring in the open source projects, give them guidelines and blueprints that we are lucky that our projects are able to generate, combine it with learnings from other people, because many people are doing great work so that there is one cohesive place where people can go and learn from each other. Eventually, what we hope to do is also have like a recognition program so that it's like, hey, this open source project did this. They are now certified X or there's like an awards program. They're still figuring that piece out, but more to come on that space. That's my part. But Stephen can tell you about all the heavy lifting that they've been doing. >> Before we get to Steve, I just want to say congratulations to you. That's great leadership. And I think you're taking a pragmatic approach and you putting the stake in the ground. And that's the number one thing, and I want to take my hat off to you guys and Priyanka, thank you for that leadership. All right, Stephen, let's talk about how this gets done because you guys open sources is what it's all about is about the people, it's about building on the successes of others, standing on the shoulders of others, you guys are used to sitting in rooms now virtually and squabbling over things like, code reviews and you got governing bodies. This is not a new thing in collaboration. So this is also a collaboration test. What are you seeing as the playbook to get this going? Can you share your insights into what the Kubernetes group's doing and how you see this. What are the few first few steps you see happening? So people can either understand it, understand the context and get involved? >> So I think it comes down to a lot of it is scope, right? So as a new contributor, as a current contributor, maybe you are one of those language experts, that is interested in getting involved as a co-chair myself for SIG Release. A lot of the things that we do, we have to consider scope. If we make this change, how is it affecting an end user? And maybe you work in contributor experience. Maybe you work in release, maybe you work in architecture. But you may not have the entire scope that you need to make a change. So I think that first it's amazing to see all of the thought that has gone through making certain changes, like discussing master and slave, discussing how we name control plane members, doing the... having the discussion around a whitelist and blacklist. What's hard about it is, is when people start making those changes. We've already seen several instances of an invigorated contributor, and maybe the new contributor coming in and starting to kind of like search and replace words. And it... I wish it was that simple, it's a discussion that has to be heard, you need buy-in from the code owners, if it's an API that you're touching, it's a conversation that you need to have with the SIG Architecture, as well as say SIG Docs. If it's something that's happening in Release, then it's a easier 'cause you can come and talk to me, but, overall I think it's getting people to the point where they can clearly understand how a change affects the community. So we kind of in this language evaluation framework, we have this idea of like first, second and third order concerns. And as you go through those concerns, there are like diminishing impacts of potential harm that a piece of language might be causing to people. So first order concerns are the ones that we want to eliminate immediately. And the ones that we commonly hear this discussion framed around. So master-slave and whitelist, blacklist. So those are ones that we know that are kind of like on the track to be removed. The next portion of that it's kind of like understanding what it means to provide a recommendation and who actually approves the recommendation. Because this group is, we have several language aficionados in this group, but we are by now means experts. And we also want to make sure that we do not make decisions entirely for the community. So, discussing that workflow from a turning a recommendation into actuating a solution for that is something that we would also do with the steering committee. So Kubernetes kind of like top governing body. Making sure that the decision is made from the top level and kind of filtered out to all of the places where people may own code or documentation around it is I think is really the biggest thing. And having a framework to make it easy to make, do those evaluations, is what we've been craving and now have. >> Well, congratulations. That's awesome. I think it's always... it's easier said than done. I mean, it's a system when you have systems and code, it's like, there's always consequences in systems architecture, you know that you do in large scales OSS. You guys know what that means. And I think the low hanging fruit, obviously master, slave, blacklist, whitelist, that's just got to get done. I mean, to me, if that just doesn't get done, that's just like a stake in the ground that must happen. But I think this idea of it takes a village, kind of is a play here. People just buy into it. That so it's a little bit of a PR thing going on too, for get buy-in, this is again a classic, getting people on board, Priyanka, isn't it? It's the obvious and then there's like, okay, let's just do this. And then what's the framework? What's the process? What's the scope? >> Yeah, absolutely agree. And many people are midway through the journey. That's one of the big challenges. Some people are on different phases of the journey, and that was one of the big reasons we started this working group, because we want to be able to provide a place of conversation for people at different stages. So we get align now rather than a year later, where everybody has their own terms as replacements and nothing works. And maybe the downstream projects that are affected, like who knows, right? It can go pretty bad. And it's very complex and it's large-scale opensource or coasters, anywhere, large software. And so because team CloudNative belongs to everyone because open source belongs to everyone. We got up, get people on the same page. For those who are eager to learn more, as I said in my keynote, please do join the two sessions that we have planned. One is going to happen, which is about inclusive naming in general, it's an hour and a half session happening on Thursday. I'm pretty sure. And there we will talk about all the various artists who are involved. Everybody will have a seat at the table and we'll have documentation and a presentation to share on how we recommend the all move, move together as an ecosystem, and then second is a presentation by Celeste in the Kubernetes working group about how Kubernetes specifically has done naming. And I feel like Stephen, you and your peers have done such amazing work that many can benefit from it. >> Well, I think engineers, you got two things going to work in for you, which is one, it's a mission. And that's... There's certainly societal benefits for this code, code is for the people. Love that, that's always been the marching orders, but also engineers are efficient. If you have duplicate efforts. I mean, it's like you think about people just doing it on their own, why not do it now, do it together, more efficient, fixing bugs over stuff, you could have solved now. I mean, this is a huge issue. So totally believe it. I know we got to go, but I want to get the news and Priyanka, you guys had some new stuff coming out from the CNCF, new things, survey, certifications, all kinds of new reports. Give us the quick highlights on the news. >> Yes, absolutely. So much news. So many talking points. Well, and that's a good thing, why? Because the CloudNative Ecosystem is thriving. There is so many people doing so much awesome stuff that I have a lot to share with you. And what does that tell us about our spirit? It tells you about the spirit of resilience. You heard about that briefly in the conversation we just had with Stephen about our working group to align various parties and initiatives together, to bring inclusive naming to code. It's about resilience because we did not get demoralized. We did not say, "oh, it's a pandemic. I can't meet anyone. So this isn't happening." No, we kept going. And that is happening in inclusive naming that is happening in the CloudNative series we're doing, that's happening in the new members that are joining, as you may have seen Volcano Engine just joined as platinum member and that's super exciting. They come from China. They're part of the larger organization that builds Tik Tok, which is pretty cool as a frequent bruiser I can say that, in addition, on a more serious note, security is really key and as I was talking to someone just minutes ago, security is not something that's a fad. Security is something that as we keep innovating, as cloud native keeps being the ground zero, for all future innovation, it keeps evolving. The problems keep getting more complex and we have to keep solving them. So in that spirit, we in CNCF see it as our job, our duty, to enable the ecosystem to be better conversant in the security needs of our code. So to that end, we are launching the CKS program, which is a certification for our Kubernetes security specialist. And it's been in the works for awhile as many of you may know, and today we are able to accept registrations. So that's a really exciting piece of news, I recommend you go ahead and do that as part of the KubeCon registration folks have a discount to get started, and I think they should do it now because as I said, the security problems keep getting worse, keep getting more complicated. And this is a great baseline for folks to start when they are thinking about this. it's also a great boon for any company out there, whether they're end users, vendors, it's all sometimes a blurry line between the two, which is all healthy. Everybody needs developers who are security conversant I would say, and this certification help you helps you achieve that. So send all of your people to go take it. So that's sort of the announcements. Then other things I would like to share are as you go, sorry, were you saying something? >> No. Go ahead. >> No, as you know, we talked about the whole thing of team CloudNative is for everyone. Open source is for everyone And I'm really proud that CNCF has offered over 1000 diversity scholarships since 2016 to traditionally under-representing our marginalized groups. And I think that is so nice, and, but just the very, very beginning. As we grow into 2021, you will see more and more of these initiatives. Every member I talked to was so excited that we put our money where our mouth is, and we support people with scholarships, mentorships, and this is only going to grow. And it just so like at almost 17%, the CNCF mentors in our program are women. So for folks who are looking for that inspiration, for folks who want to see someone who looks like them in these places, they have more diverse people to look up to. And so overall, I think our DEI focus is something I'm very proud of and something you may hear about in other news items. And then finally, I would like to say is that CloudNative continues to grow. The cloud native wave is strong. The 2.0 for team CloudNative is going very well. For the CloudNative annual survey, 2020, we found an astonishing number of places where CloudNative technologies are in production. You heard some stories that I told in my keynote of people using multiple CNCF projects together. And these are amazing and users who have this running in production. So our ecosystem has matured. And today I can tell you that Kubernetes is used in production, by at about 83% of the places out there. And this is up by 5% from 78% last year. And just so much strength in this ecosystem. I mean, now at 92% of people are using containers. So at this point we are ubiquitous. And as you've heard from us in various times, our 70 plus project portfolio shows that we are the ground zero of innovation in cloud native. So if you asked me to summarize the news, it's number one, team CloudNative and open source is for everyone. Number two, we take pride in our diversity and over 1000 scholarships have been given out since 2016 to recipients from underrepresented groups. Number three, this is the home base for innovation with 83% of folks using Kubernetes in production and 70 plus projects that deliver a wide variety of support to enterprises as they modernize their software and utilize containers. >> Awesome. That was a great summary. First of all, you're a great host. You should be hosting theCUBE with us. Great keynote, love the virtual events that you guys have been doing, love the innovation. I think I would just say just from my perspective and being from there from the beginning is it's always been inclusive and the experience of the events and the community have been top-notch. People squabble, people talk, people have conversations, but at the end of the day, it is a great community and it's fun, memorable, and people are accepting, it's a great job. Stephen, good job as co-chair this year. Well done. Congratulations. >> Thank you very much. >> Okay. Thanks for coming on, I appreciate it. >> Take it easy. >> Okay, this is theCUBE virtual, we wish we were there in person, but we're not, we're remote. This is the virtual Cube. I'm John Furrier, your host. Thanks for watching. (upbeat music)

from around the globe it's thecube covering space and cyber security symposium 2020 hosted by cal poly hello everyone welcome to the space and cyber security symposium 2020 hosted by cal poly where the intersection of space and security are coming together i'm john furrier your host with thecube here in california i want to welcome our featured guest lieutenant general john f thompson with the united states space force approach to cyber security that's the topic of this session and of course he's the commander of the space and missile system center in los angeles air force base also heading up space force general thank you for coming on really appreciate you kicking this off welcome to the symposium hey so uh thank you very much john for that very kind introduction also uh very much thank you to cal poly uh for this opportunity to speak to this audience today also a special shout out to one of the organizers uh dustin brun for all of his work uh helping uh get us uh to this point uh ladies and gentlemen as uh as uh john mentioned uh i'm jt thompson uh i lead the 6 000 men and women of the united states space forces space and missile system center which is headquartered here at los angeles air force base in el segundo if you're not quite sure where that's at it's about a mile and a half from lax this is our main operating location but we do have a number of other operating locations around the country with about 500 people at kirtland air force base in albuquerque new mexico uh and about another 500 people on the front range of the rockies uh between colorado springs and uh and denver plus a smattering of other much smaller operating locations nationwide uh we're responsible for uh acquiring developing and sustaining the united states space force's critical space assets that includes the satellites in the space layer and also on the ground layer our ground segments to operate those satellites and we also are in charge of procuring launch services for the u.s space force and a number of our critical mission partners across the uh department of defense and the intelligence community um just as a couple of examples of some of the things we do if you're unfamiliar with our work we developed and currently sustained the 31 satellite gps constellation that satellite constellation while originally intended to help with global navigation those gps signals have provided trillions of dollars in unanticipated value to the global economy uh over the past three decades i mean gps is everywhere i think everybody realizes that agriculture banking the stock market the airline industry uh separate and distinct navigation systems it's really pervasive across both the capabilities for our department of defense and capabilities for our economy and and individuals billions of individuals across our country and the planet some of the other work we do for instance in the communications sector uh secure communications satellites that we design and build that link america's sons and daughters serving in the military around the world and really enable real-time support and comms for our deployed forces and those of our allies we also acquire uh infrared missile warning satellites uh that monitor the planet for missile launches and provide advanced warning uh to the u.s homeland and to our allies uh in case some of those missile launches are uh nefarious um on a note that's probably a lot closer to home maybe a lot closer to home than many of us want to think about here in the state of california in 2018 smc jumped through a bunch of red tape and bureaucracy uh to partner with the u.s forest service during the two of the largest wildfires in the state's history the camp and woolsey fires in northern california as those fires spread out of control we created processes on the fly to share data from our missile warning satellites those are satellites that are systems that are purpose built to see heat sources from thousands of miles above the planet and we collaborated with the us forest service so that firefighters on the ground uh could track those fires more in real time and better forecast fires and where they were spreading thereby saving lives and and property by identifying hot spots and flare-ups for firefighters that data that we were able to working with our contractors pass to the u.s forest service and authorities here in california was passed in less than an hour as it was collected to get it into the hands of the emergency responders the first responders as quickly as possible and doing that in an hour greatly surpassed what was available from some of the other assets in the airborne and ground-based fire spotters it was really instrumental in fighting those fires and stopping their spread we've continued uh that involvement in recent years using multiple systems to support firefighters across the western u.s this fall as they battled numerous wildfires that unfortunately continue working together with the u.s forest service and with other partners uh we like to make uh we like to think that we made a difference here but there's still a lot more work to go and i think that we should always be asking ourselves uh what else can space data be used for and how can we more rapidly get that space data to uh stakeholders so that they can use it for for purposes of good if you will how else can we protect our nation how else can we protect our friends and allies um i think a major component of the of the discussion that we will have throughout this conference is that the space landscape has changed rapidly and continues to change rapidly um just over the past few years uh john and i were talking before we went live here and 80 nations now have uh space programs 80 nearly 80 space faring nations on the planet um if you just look at one mission area that uh the department of defense is interested in and that's small launch there are currently over a hundred different small launch companies uh within the u.s industrial base vying for commercial dod and civil uh payload capabilities uh mostly to low earth orbit it's it's just truly a remarkable time if you factor in those things like artificial intelligence and machine learning um where we're revolutionary revolutionizing really uh the ways that we generate process and use data i mean it's really remarkable in 2016 so if you think about this four years ago uh nasa estimated that there were 28 terabytes of information transiting their space network each day and that was four years ago um uh obviously we've got a lot of desire to work with a lot of the people in the audience of this congress or in this conference uh we need to work with big thinkers like many of you to answer questions on how best we apply data analytics to extract value and meaning from that data we need new generations of thinkers to help apply cutting edge edge theories of data mining cyber behaviorism and internet of things 2.0 it's just truly a remarkable time uh to be in the space business and the cyber aspects of the states of the space business are truly truly daunting and important to uh to all of us um integrating cyber security into our space systems both commercial and government is a mandate um it's no longer just a nice to have as the us space force and department of the air force leadership has said many times over the past couple of years space is becoming congested and contested and that contested aspect means that we've got to focus on cyber security uh in the same way that the banking industry and cyber commerce focus on uh cyber security day in and day out the value of the data and services provided is really directly tied to the integrity and availability of that data and services from the space layer from the ground control segments associated with it and this value is not just military it's also economic and it's not just american it's also a value for the entire world particularly particularly our allies as we all depend upon space and space systems your neighbors and friends here in california that are employed at the space and missile system center uh work with network defenders we work with our commercial contractors and our systems developers um our international allies and partners to try and build as secure and resilient systems as we can from the ground up that keep the global commons of space free and open for exploration and for commerce um as john and i were talking earlier before we came online there's an aspect of cyber security for space systems especially for some of our legacy systems that's more how do we bolt this on because we fielded those space systems a number of years ago and the the challenges of cyber security in the space domain have grown so we have a part that we have to worry about bolting it on but then we have to worry about building it in as we as we field new systems and build in a flexibility that that realizes that the cyber threat or the cyber security landscape will evolve over time it's not just going to be stagnant there will always be new vulnerabilities and new threat vectors that we always have to look at look uh as secretary barrett who is our secretary of the air force likes to say most americans use space before they have their first cup of coffee in the morning the american way of life really depends on space and as part of the united states space force we work with defense leaders our congress joint and international military teammates and industry to ensure american leadership in space i really thank you for this opportunity to address the audience today john and thanks so much to cal poly for letting me be one of the speakers at this event i really look forward to this for uh several months and so with that i look forward to your questions as we kind of move along here general thank you very much for the awesome uh introductory statement uh for the folks watching on the stream brigadier general carthan is going to be in the chat answering any questions feel free to chat away he's the vice commander of space and missile systems center he'll be available um a couple comments from your keynote before i get to my questions because it just jumped in my head you mentioned the benefits of say space but the fires in california we're living that here that's really real time that's a benefit you also mentioned the ability for more people launching payloads into space and i only imagine moore's law smaller faster cheaper applies to rockets too so i'm imagining you have the benefits of space and you have now more potential objects flying out sanctioned and maybe unsanctioned so you know is it going to be more rules around that i mean this is an interesting question because it's exciting space force but for all the good there is potentially bad out there yeah so i i john i think the uh i think the basics of your question is as space becomes more congested and contested is there a need for more international norms of how satellites fly in space what kind of basic features satellites have to perhaps deorbit themselves what kind of basic protections does do all satellites should all satellites be afforded as part of a peaceful global commons of space i think those are all fantastic questions and i know that u.s and many uh allied policy makers are looking very very hard at those kinds of questions in terms of what are the norms of behavior and how we uh you know how how we field and field is the military term but you know how we uh populate uh using civil or uh commercial terms uh that space layer at different altitudes uh low earth orbit mid mid-earth orbit geosynchronous earth orbit different kinds of orbits uh what the kind of mission areas we accomplish from space that's all things that need to be definitely taken into account as uh as the place gets a little bit not a little bit as the place gets increasingly more popular day in and day out well i'm super excited for space force i know that a new generation of young folks are really interested in it's an emerging changing great space the focus here at this conference is space and cyber security intersection i'd like to get your thoughts on the approach that space force is taking to cyber security and how it impacts our national goals here in the united states yeah yeah so that's a that's a great question john let me let me talk about in two uh two basic ways but number one is and and i know um some people in the audience this might make them a little bit uncomfortable but i have to talk about the threat right um and then relative to that threat i really have to talk about the importance of uh of cyber and specifically cyber security as it relates to that threat um the threats that we face um really represent a new era of warfare and that new era of warfare involves both space and cyber uh we've seen a lot of action in recent months uh from certain countries notably china and russia uh that have threatened what i referred to earlier as the peaceful global commons of space for example uh it through many unclassified sources and media sources everybody should understand that um uh the russians have been testing on orbit uh anti-satellite capabilities it's been very clear if you were following just the week before last the department of defense released its uh 2020 military and security developments involving the people's republic of china um uh and uh it was very clear that china is developing asats electronic jammers directed energy weapons and most relevant to today's discussion offensive cyber uh capabilities there are kinetic threats uh that are very very easy to see but a cyber attack against a critical uh command and control site or against a particular spacecraft could be just as devastating to the system and our war fighters in the case of gps and important to note that that gps system also impacts many civilians who are dependent upon those systems from a first response perspective and emergency services a cyber attack against a ground control site could cause operators to lose control of a spacecraft or an attacker could feed spoofed data to a system to mislead operators so that they send emergency services personnel to the to the wrong address right attacks on spacecraft on orbit whether directly via a network of intrusion or enabled through malware introduced during the systems production uh while we're building the satellite can [ __ ] or corrupt the data denial of service type attacks on our global networks obviously would disrupt our data flow and interfere with ongoing operations and satellite control i mean if gps went down i you know i hesitate to say it this way because we might elicit some screams from the audience but if gps went down a starbucks wouldn't be able to handle your mobile order uber drivers wouldn't be able to find you and domino's certainly certainly wouldn't be able to get there in 30 minutes or less right so with a little bit of tongue-in-cheek there from a military operations perspective it's dead serious um uh we have become accustomed in the commercial world to threats like lance ransomware and malware and those things have unfortunately become commonplace in commercial terrestrial networks and computer systems however what we're seeing is that our adversaries with the increased competition in space these same techniques are being retooled if you will to use against our national security space systems uh day in and day out um as i said during my opening remarks on the importance of cyber the value of these systems is directly tied to their integrity if commanders in the field uh firefighters in california or baristas in in starbucks can't trust the data they see they're receiving then that really harms their decision-making capabilities one of the big trends we've recently seen is the mood move towards proliferated leo uh uh constellations obviously uh spacex's uh starlink uh on the commercial side and on the military side the work that darpa and my organization smc are doing on blackjack and casino as well as some space transport layer constellation work that the space development agency is designing are all really really important types of mesh network systems that will revolutionize how we plan and field warfighting systems and commercial communications and internet providing systems but they're also heavily reliant on cyber security uh we've got to make sure that they are secured to avoid an accident or international damage uh loss of control of these constellations really could be catastrophic from both a mission perspective or from uh you know satellites tumbling out of low earth orbit perspective another trend is introductions in artificial intelligence and machine learning on board spacecraft or at the edge our satellites are really not so much hardware systems with a little software anymore in the commercial sector and in the defense sector they're basically flying boxes full of software right and we need to ensure the data that we're getting out of those flying boxes full of software are helping us base our decisions on accurate data and algorithms govern governing the right actions and that those uh that those systems are impervious to the extent possible uh to nefarious uh modifications so in summation a cyber security is vital element of everything in our national security space goals and i would argue for our national uh goals uh writ large including uh economic and information uh uh dimensions uh the space force leadership at all levels uh from uh some of the brand new second lieutenants that general raymond uh swore into the space force this morning uh ceremonially from the uh air force association's air space and cyberspace conference uh to the various highest levels general raymond uh general d t thompson myself and a number of other senior leaders in this enterprise we've got to make sure that we're all working together to keep cyber security at the forefront of our space systems because it they absolutely depend on it you know you mentioned uh hardware software threats opportunities challenges i want to ask you because you you got me thinking of the minute there around infrastructure i mean we've heard critical infrastructure you know grids here on on earth you're talking about critical infrastructure a redefinition of what critical infrastructure is an extension of what we have so i'd love to get your thoughts about space force's view of that critical infrastructure vis-a-vis the threat vectors because you know the term threat vectors has been kicked around in the cyber space oh yeah threat vectors they're always increasing the surface area well if the surface area is from space it's an unlimited surface area so you got different vectors so you got new critical infrastructure developing real time really fast and you got an expanded threat vector landscape putting that in perspective for the folks that aren't really inside the ropes on these critical issues how would you explain this and how would you talk about those two things well so i tell you um i just like um uh just like uh i'm sure people in the security side or the cyber security side of the business in the banking industry feel they feel like it's uh all possible threat vectors represent a dramatic and protect potentially existential threat to all of the dollars that they have in the banking system to the financial sector on the department of defense side we've got to have sort of the same mindset um that threat vector from to and through space against critical space systems ground segments the launch enterprise or transportation uh to orbit and the various different uh domains within uh within space itself like i mentioned before uh leo mio and geo-based satellites with different orbits all of the different mission areas that are accomplished from space that i mentioned earlier some that i didn't mention like weather tactical or wide band communications uh various new features of space control all of those are things that we have to worry about from a cyber security uh threat perspective and it's a it's a daunting challenge right now right yeah it's awesome and one of the things we've been following on the hardware side here in the on the ground is the supply chain we've seen you know malware being you know really put into really obscure hardware who manufactures it as being outsourced obviously government has restrictions but with the private sector uh you mentioned china and and the us kind of working together across these these peaceful areas but you got to look at the supply chain how does the supply chain the security aspect impact the mission of the u.s space force yeah yeah so so um how about another um just in terms of an example another kind of california-based historical example right um the very first u.s satellite uh explorer one was built by uh the jet propulsion uh laboratory folks uh not far from here in el segundo up in uh up in pasadena um that satellite when it was first built in the late 50s uh weighed a little bit over 30 pounds and i'm sure that each and every part was custom made and definitely made by u.s companies fast forward to today the global supply chain is so tightly coupled and frankly many industries are so specialized almost specialized regionally around the planet we focus every day to guarantee the integrity of every component that we put in our space systems is absolutely critical to the operations of those satellites and we're dependent upon them but it becomes more difficult and more difficult to understand the the heritage if you will of some of the parts that are used the thousands of parts that are used in some of our satellites that are literally school bus sized right the space industry especially uh national security space sector um uh is relatively small compared to other commercial industries and we're moving to towards using more and more parts uh from non-us companies uh cyber security and cyber awareness have to be baked in from the beginning if we're going to be using parts that maybe we don't necessarily um understand 100 percent like an explorer one uh the the lineage of that particular part the environmental difficulties in space are well known the radiation environment the temperature extremes the vacuum those require specialized component and the us military is not the only uh customer in that space in fact we're definitely not the dominant customer uh in space anymore all those factors require us along with our other government partners and many different commercial space organizations to keep a very close eye on our supply chains from a quality perspective a security perspective and availability um there's open source reporting on supply training intrusions from um many different breaches of commercial retailers to the infectious spread of uh you know compromised patches if you will and our adversaries are aware of these techniques as i mentioned earlier with other forms of attack considering our supply chains and development networks really becomes fair game for our adversaries so we have to uh take that threat seriously um between the government and industry sectors here in the u.s we're also working with our industry partners to enact stronger defenses and assess our own vulnerabilities last fall we completed an extensive review of all of our major contracts here at space and missile system center to determine the levels of cyber security requirements we've implemented across our portfolio and it sounds really kind of you know businessy geeky if you will you know hey we looked at our contracts to make sure that we had the right clauses in our contracts to address cyber security as dynamically as we possibly could and so we found ourselves having to add new language to our contracts to require system developers to implement some more advanced uh protective measures in this evolving cyber security environment so that data handling and supply chain perspective uh protections um from contract inception to launch and operations were taken into account uh cyber security really is a key performance parameter for us now it's as important as the the mission performance of the system it's as important as cost it's as important as schedule because if we deliver the perfect system on time and on cost uh it can perform that missile warning or that communications mis mission perfectly but it's not cyber secure if it doesn't have cyber protections built into it or the ability to implement mitigations against cyber uh threats then we've essentially fielded a shoe box in space that doesn't do the k the the war fighter or the nation uh any good um supply chain risk management is a is a major challenge for us uh we're doing a lot to coordinate with our industry partners uh we're all facing it head on uh to try and build secure and trusted components uh that keep our confidence as leaders firefighters and baristas uh as the case may be uh but it is a challenge and we're trying to rise to that challenge you know this so exciting this new area because it really touches everything you know talk about geeking out on on the tech the hardware the systems but also you put your kind of mba hat on you go what's the roi of the extra development and how you how things get built because the always the exciting thing for space geeks is like you're building cool stuff people love it's it's exciting but you still have to build and cyber security has proven that security has to be baked in from the beginning and be thought as a system architecture so you're still building things which means you've got to acquire things you got to acquire parts you got to acquire build software and and sustain it how is security impacting the acquisition and the sustainment of these systems for space yeah from initial development uh through planning for the acquisition design development fielding or production fielding and sustainment it impacts all aspects of of the life cycle john uh we simply especially from the concept of baking in cyber security uh we can't wait until something is built and then try and figure out how to make it cyber secure so we've moved way further uh towards working side by side with our system developers to strengthen cyber security from the very beginning of a system's development cyber security and the resilience associated with it really have to be treated as a key system attribute as i mentioned earlier equivalent with data rates or other metrics of performance we like to talk in uh in the space world about uh mission assurance and mission assurance has always you know sort of taken us as we as we technically geek out right mission assurance has always taken us to the will this system work in space right can it work in a vacuum can it work in you know as it as it uh you know transfers through uh the van allen radiation belt or through the the um the southern hemisphere's electromagnetic anomaly right will it work out in space and now from a resiliency perspective yeah it has to work in space it's got to be functional in space but it's also got to be resistant to these cyber security threats it's it's not just i think uh general dt thompson quoted this term it's not just widget assurance anymore it's mission assurance um uh how does that satellite uh operator that ground control segment operate while under attack so let me break your question a little bit uh just for purposes of discussion into into really two parts uh cyber uh for cyber security for systems that are new and cyber security uh for systems that are in sustainment or kind of old and legacy um obviously there's cyber vulnerabilities that threaten both and we really have to employ different strategies for for defense of of each one for new systems uh we're desperately trying to implement across the department of defense in particular in the space world a kind of a devsecops methodology and practice to delivering software faster and with greater security for our space systems here at smc we have a program called enterprise ground services which is a tool kit basically a collection of tools for common command and control of different satellite systems egs as we call it has an integrated suite for defensive cyber capabilities network operators can use these tools to gain unprecedented insight to data flows and to monitor space network traffic for anomalies or other potential indicators of of bad behavior malicious behavior if you will um uh it's rudimentary at this point but because we're using devsecops and that incremental development approach as we scale it it just becomes more and more capable you know every every product increment that we field here at uh at uh la air force base uh uh we have the united space space forces west coast software factory which we've dubbed kobayashi maru they're using those agile devops uh software development practices uh to deliver uh space awareness software uh to the combined space operations center uh affectionately called the csp that c-spock is just down the road uh from cal poly uh there in san luis obispo at vandenberg air force base they've securely linked the c-spock with other space operation centers around the planet our allies australia canada and the uk uh we're partnering with all of them to enable secure and enhanced combined space operations so lots of new stuff going on as we bake in new development uh capabilities for our our space systems but as i mentioned earlier we've got large constellations on satellite of satellites on orbit right now some of them are well in excess of a decade or more old on orbit and so the design aspects of those satellites are several decades old and so but we still have to worry about them because they're critical to our space capabilities um we've been working with an air force materiel command organization uh called crows which stands for the cyber resiliency office for uh weapon systems to assess all of those legacy platforms from a cyber security perspective and develop defensive strategies and potential hardware and software upgrades to those systems to better enable them to to live through this increasingly cyber security uh concerned era that we currently live in our industry partners have been critical to to both of those different avenues both new systems and legacy systems we're working closely with them to defend and upgrade uh national assets and develop the capabilities to do similar with uh with new national assets coming online the vulnerabilities of our space systems really kind of threaten the way we've done business in the past both militarily and in the case of gps economically the impacts of that cyber security risk are clear in our acquisition and sustainment processes but i've got to tell you it that as the threat vectors change as the vulnerabilities change we've got to be nimble enough agile enough to be able to bounce back and forth we can't just say uh many people in the audience are probably familiar with the rmf or the risk management framework approach to um to reviewing uh the cyber security of a system we can't have program managers and engineers just accomplish an rmf on a system and then hey high five we're all good uh it's a journey not a destination that's cyber security and it's a constant battle rhythm throughout a weapon systems life cycle not just a single event i want to get to this commercial business needs and your needs on the next question but before i go there you mentioned the agile and i see that clearly because when you have accelerated innovation cycles you've got to be faster and we saw this in the computer industry mainframes mini computers and then when you started getting beyond me when the internet hit and pcs came out you saw the big enterprises the banks and and government start to work with startups it used to be a joke in the entrepreneurial circles is that you know there's no way if you're a startup you're ever going to get a contract with a big business enterprise now that used to be for public sector and certainly uh for you guys so as you see startups out there and there's acquisition involved i'm sure would love to love to have a contract with space force there's an roi calculation where if it's in space and you have a sustainment view edit software you might have a new kind of business model that could be attractive to startups could you share your thoughts on the folks who want to be a supplier to you uh whether they're a startup or an existing business that wants to be agile but they might not be that big company we are john that's a fantastic question we are desperately trying to reach out to to those new space advocates to those startups to those um what we sometimes refer to within the department of defense those non-traditional uh defense contractors a couple of things just for uh thinking purposes on some of the things that we're trying to highlight um uh three years ago we created here at uh space and missile system center uh the space enterprise consortium uh to provide a platform uh a contractual vehicle really to enable us to rapidly prototype uh development of space systems and to collaborate uh between the u.s space force uh traditional defense contractors non-traditional vendors like startups and even some academic institutions uh spec as we call it space enterprise consortium uses a specialized contracting tool to get contracts uh awarded quickly many in the audience may be familiar with other transaction agreements and that's what spec is based on and so far in just three years spec has awarded 75 different uh prototyping contracts worth over 800 million dollars with a 36 reduction in time to award and because it's a consortium based competition for um for these kinds of prototyping efforts the barrier to entry for small and non-traditional for startups even for academic institutions to be able to compete for these kinds of prototypings is really lowered right um uh these types of partnerships uh that we've been working through on spec uh have really helped us work with smaller companies who might not have the background or expertise in dealing with the government or in working with cyber security uh for their systems both their developmental systems and the systems that they're designing and trying to build we want to provide ways for companies large and small to partner together and support um uh kind of mutually beneficial uh relationships between all um recently uh at the annual air force association uh conference that i mentioned earlier i moderated a panel with several space industry leaders uh all from big traditional defense contractors by the way and they all stressed the importance of building bridges and partnerships uh between major contractors in the defense industry and new entrants uh and that helps us capture the benefits of speed and agility that come with small companies and startups as well as the expertise and specialized skill sets of some of those uh larger contractors uh that we rely on day in and day out advanced cyber security protections and utilization of secure facilities are just a couple of things that i think we could be prioritizing more so in those collaborations as i mentioned earlier the spec has been very successful in awarding a number of different prototyping contracts and large dollar values and it's just going to get better right there's over 400 members of the space enterprise consortium 80 of them are non-traditional kinds of vendors and we just love working with them another thing that many people in the audience may be familiar with in terms of our outreach to innovators uh if you will and innovators that include uh cyber security experts is our space pitch day events right so we held our first event last november in san francisco uh where we awarded over a two-day period about 46 million dollars to 30 different companies um that had potentially game-changing ideas these were phase two small business innovative research efforts uh that we awarded with cash on the spot uh we're planning on holding our second space pitch day in the spring of 2021. uh we're planning on doing it right here in los angeles uh covent 19 environment permitting um and we think that these are you know fantastic uh uh venues for identifying and working with high-speed startups startups and small businesses who are interested in uh really truly partnering with the us air force it's a as i said before it's a really exciting time to be a part of this business uh and working with the innovation economy uh is something that the department of defense uh really needs to do in that um the innovation that we used to think was ours you know that 80 percent of the industrial-based innovation that came from the department of defense uh the the script has been flipped there and so now more than 70 percent uh particularly in space innovation uh comes from the commercial sector not from uh not from the defense business itself and so um that's a tsunami of uh investment and a tsunami of uh capability and i need to figure out how to get my surfboard out and ride it you know what i mean yeah i mean it's one of those things where the flip the script has been flipped but it's exciting because it's impacting everything are you talking about systems architecture you're talking about software you're talking about a business model you talk about devsecops from a technical perspective but now you have a business model innovation all the theaters of uh are exploding in innovation technical business personnel this brings up the workforce challenge you've got the cyber needs for the u.s space force there's probably a great roi model for new kinds of software development that could be priced into contracts that's a entrepreneurial innovation you got the the business model theater you've got the personnel how does the industry adopt and change you guys are clearly driving this how does the industry adjust to you yeah so um i think a great way to answer that question is to just talk about the kind of people that we're trying to prioritize in the u.s space force from a from an acquisition perspective and in this particular case from a from a cyber security perspective as i mentioned earlier it's the most exciting time to be in space programs uh really since the days of apollo um uh you know just to put it in terms that you know maybe have an impact with the audience uh from 1957 until today approximately 9 000 satellites uh have been launched from the various space faring countries around the planet uh less than two thousand of those nine thousand are still up on orbit and operational and yet in the new space regime um players like spacex have plans to launch you know 12 000 satellites for some of their constellations alone it really is a remarkable time in terms of innovation and fielding of space capabilities and all of those space capabilities whether they're commercial civil or defense are going to require appropriate cyber security uh protections it's just a really exciting time uh to be working in stuff like this and so uh folks like the folks in this audience who have a passion about space and a passion about cyber security are just the kind of people that we want to work with because we need to make sure our systems are are secure and resilient we need folks that have technical and computing expertise engineering skills to be able to design cybersecure systems that can detect and mitigate attacks uh but we also as you alluded to we need people that have that business and um you know business acumen human networking background so that we can launch the startups and work with the non-traditional businesses uh help to bring them on board help to secure both their data and our data and uh and and make sure our processes and systems are are free as much as possible from uh uh from attack um for preparation for for audience members who are young and maybe thinking about getting into this uh trade space um you gotta be smart on digital networking uh you gotta understand basic internet protocols concepts uh programming languages uh database design uh learn what you can from penetration or vulnerability testing and and uh risk assessment i will tell you this and i don't think he will i know he will not mind me telling you this but you've got to be a lifelong learner and so two years ago i'm at home one evening and i get a phone call on my cell phone and it's my boss the commander of air force space command uh general j raymond who is now currently the chief of space operations and he is on temporary duty flying overseas he lands where he's going and he first thing he does when he lands is he calls me and he goes jt um while i was traveling um i noticed that there were e-books available on the commercial airliner i was traveling on and there was an e-book on something called scrumming and agile devsecops and i read it have you read it um and i said no sir but if you tell me what the title of the book is i will read it and so i got to go to my staff meeting um you know the very next week the next time we had a staff meeting and tell everybody in the stab meeting hey if the four star and the three star can read the book about scrumming then i'm pretty sure all of you around this table and all our lieutenants and our captains our gs13s all of our government employees can get smart on uh the scrumming development process and interestingly as another side i had a telephone call with him last year during the holidays where he was trying to take some leave and i said sir what are you up to today are you are you you know making eggnog for the event tonight or whatever and the chief of space operations told me no i'm trying to teach myself python i'm at lesson two and it's not going so well but i'm i'm gonna figure this out and so that kind of thing if the chief of staff or the you know the the the chief of space operations can prioritize scrumming and python language and innovation in his daily schedule then we're definitely looking for other people who can do that and we'll just say lower levels of rank uh throughout our entire space force enterprise um look i i we don't need to need people that can code a satellite from scratch but we need to know we need to have people that have a basic grasp of the programming basics and cyber security requirements and that can turn those things into into meaningful actions obviously in the space domain things like basic physics and orbital mechanics are also important uh space is not an intuitive uh domain so under understanding how things survive uh on orbit is really critical to making the right design and operational decisions and you know i know there's probably a lot because of this conference i know there's a probably a whole lot of high-speed cyber security experts out in the audience and i need those people in the u.s space force the the country is counting on it but i wouldn't discount having people that are just cyber aware or cyber savvy right i have contracting officers and logisticians and program managers and they don't have to be high-end cyber security experts but they have to be aware enough about it to be able to implement cyber security protections um into our space system so the skill set is is really really broad um our adversaries are pouring billions of dollars into uh define designing uh and fielding offensive and destructive space cyber security weapons right they've repeatedly shown really a blatant disregard of safety and international norms for good behavior on orbit and the cyber security aspects of our space systems is really a key battleground going forward so that we can maintain that as i mentioned before peaceful uh global commons of space we really need all hands on deck if you're interested in helping in uniform if you're interested in helping uh not in uniform uh but as a government employee a commercial or civil employee to help us make cyber security more important uh or more cape more able to be developed for our space systems then we'd really love to uh to work with you or have you on the team to build that safe and secure future for our space systems lieutenant general john thompson great insight thank you for sharing all that awesome stories too and motivation for the young next generation the united states space force approach of cyber security really amazing talk thank you for your time final parting question is as you look out and you had your magic wand what's your view for the next few years in terms of things that we could accomplish it's a super exciting time what do you hope for so um um first of all john thanks to you and and thanks to cal poly uh for the invitation and and thanks to everybody for uh for their interest in cyber security especially as it relates to space systems that's here at the conference um uh there's a quote and i'll read it here uh from uh bernard schriever who was the uh the founder if you will uh a legend in uh dod space the founder of the western development division which was a predecessor organization to space and missile systems center general shrever i think captures the essence of what how we see the next couple of years the world has an ample supply of people who can always come up with a dozen good reasons why new ideas will not work and should not be tried but the people who produce progress are breed apart they have the imagination the courage and the persistence to find solutions and so i think if you're hoping that the next few years of space innovation and cyber security innovation are going to be a pony ride at the county fair then perhaps you should look for another line of work because i think the next few years in space and cyber security innovation are going to be more like a rodeo um and a very dynamic rodeo as it goes it is a an awesome privilege to be part of this ecosystem it's really an honor for me to um to be able to play some small role uh in the space ecosystem and trying to improve it uh while i'm trying to improve the chances of uh of the united states of america in a uh in a space war fighting uh uh environment um and so i thank all of you for uh participating today and for this little bit of time that you've allowed me to share with you thank you sir thank you for your leadership and thank you for the for the time for this awesome event space and cyber security symposium 2020 i'm john furrier on behalf of cal poly thanks for watching [Music]

(upbeat electronic music) >> Narrator: From theCUBE studios in Palo Alto and Boston, connecting with thought leaders all around the world, this is a CUBE conversation. >> Okay, hello everyone. I'm John Furrier with theCUBE. We're here with Meet the Analysts segment Sunday morning. We've got everyone around the world here to discuss a bit of the news around the EU killing the privacy deal, striking it down, among other topics around, you know, data privacy and global commerce. We got great guests here, Ray Wang, CEO of Constellation Research. Bill Mew, founder and CEO of Cyber Crisis Management from the Firm Crisis Team. And JD, CEO of Spearhead Management. JD, I can let you say your name because I really can't pronounce it. How do I (laughs) pronounce it, doctor? >> I wouldn't even try it unless you are Dutch, otherwise it will seriously hurt your throat. (Ray laughing) So, JD works perfect for me. >> Doctor Drooghaag. >> And Sarbjeet Johal, who's obviously an influencer, a cloud awesome native expert. Great, guys. Great to have you on, appreciate it, thanks for comin' on. And Bill, thank you for initiating this, I appreciate all your tweets. >> Happy Sunday. (Bill laughing) >> You guys have been really tweeting up a storm, I want to get everyone together, kind of as an analyst, Meet the Analyst segment. Let's go through with it. The news is the EU and U.S. Privacy Shield for data struck down by the court, that's the BBC headline. Variety of news, different perspectives, you've got an American perspective and you've got an international perspective. Bill, we'll start with you. What does this news mean? I mean, basically half the people in the world probably don't know what the Privacy Shield means, so why is this ruling so important, and why should it be discussed? >> Well, thanks to sharing between Europe and America, it's based on a two-way promise that when data goes from Europe to America, the Americans promise to respect our privacy, and when data goes form America to Europe, the Europeans promise to respect the American privacy. Unfortunately, there are big cultural differences between the two blocks. The Europeans have a massive orientation around privacy as a human right. And in the U.S., there's somewhat more of a prioritization on national security, and therefore for some time there's been a mismatch here, and it could be argued that the Americans haven't been living up to their promise because they've had various different laws, and look how much talk about FISA and the Cloud Act that actually contravene European privacy and are incompatible with the promise Americans have given. That promise, first of all, was in the form of a treaty called Safe Harbor. This went to court and was struck down. It was replaced by Privacy Shield, which was pretty much the same thing really, and that has recently been to the court as well, and that has been struck down. There now is no other means of legally sharing data between Europe and America other than what are being called standard contractual clauses. This isn't a broad treaty between two nations, these are drawn by each individual country. But also in the ruling, they said that standard contractual clauses could not be used by any companies that were subject to mass surveillance. And actually in the U.S., the FISA courts enforce a level of mass surveillance through all of the major IT firms, of all major U.S. telcos, cloud firms, or indeed, social media firms. So, this means that for all of the companies out there and their clients, business should be carrying on as usual apart from if you're one of those major U.S. IT firms, or one of their clients. >> So, why did this come about? Was there like a major incident? Why now, was it in the court, stuck in the courts? Were people bitchin' and moanin' about it? Why did this go down, what's the real issue? >> For those of us who have been following this attentively, things have been getting more and more precarious for a number of years now. We've had a situation where there are different measures being taken in the U.S., that have continued to erode the different protections that there were for Europeans. FISA is an example that I've given, and that is the sort of secret courts and secret warrants that are issued to seize data without anyone's knowledge. There's the Cloud Act, which is a sort of extrajudicial law that means that warrants can be served in America to U.S. organizations, and they have to hand over data wherever that data resides, anywhere in the world. So, data could exist on a European server, if it was under the control of an American company, they'd have to hand that over. So, whilst FISA is in direct conflict with the promises that the Americans made, things like the Cloud Act are not only in controversion with the promise they've made, there's conflicting law here, because if you're a U.S. subsidiary of a big U.S. firm, and you're based in Europe, who do you obey, the European law that says you can't hand it over because of GDPR, or the American laws that says they've got extrajudicial control, and that you've got to hand it over. So, it's made things a complete mess. And to say has this stuff, hasn't really happened? No, there's been a gradual erosion, and this has been going through the courts for a number of years. And many of us have seen it coming, and now it just hit us. >> So, if I get you right in what you're saying, it's basically all this mishmash of different laws, and there's no coherency, and consistency, is that the core issue? >> On the European side you could argue there's quite a lot of consistency, because we uphold people's privacy, in theory. But there have been incidents which we could talk about with that, but in theory, we hold your rights dear, and also the rights of Europeans, so everyone's data should be safe here from the sort of mass surveillance we're seeing. In the U.S., there's more of a direct conflict between everything, including there's been a, in his first week in the White House, Donald Trump signed an executive order saying that the Privacy Act in the U.S., which had been the main protection for people in the U.S., no longer applied to non-U.S. citizens. Which was, if you wanted try and cause a storm, and if you wanted to try and undermine the treaty, there's no better way of doing it than that. >> A lot of ways, Ray, I mean simplify this for me, because I'm a startup, I'm hustlin', or I'm a big company, I don't even know who runs the servers anymore, and I've got data stored in multiple clouds, I got in regions, and Oracle just announced more regions, you got Amazon, a gazillion regions, I could be on-premise. I mean bottom line, what is this about? I mean, and -- >> Bill's right, I mean when Max Schrems, the Austrian. Bill's right, when Max Schrems the Austrian activist actually filed his case against Facebook for where data was being stored, data residency wasn't as popular. And you know, what it means for companies that are in the cloud is that you have to make sure your data's being stored in the region, and following those specific region rules, you can't skirt those rules anymore. And I think the cloud companies know that this has been coming for some time, and that's why there's been announced in a lot of regions, a lot of areas that are actually happening, so I think that's the important part. But going back to Bill's earlier point, which is important, is America is basically the Canary Islands of privacy, right? Privacy is there, but it isn't there in a very, very explicit sense, and I think we've been skirting the rules for quite some time, because a lot of our economy depends on that data, and the marketing of the data. And so we often confuse privacy with consent, and also with value exchange, and I think that's part of the problem of what's going on here. Companies that have been building their business models on free data, free private data, free personally identifiable data information are the ones that are at risk! And I think that's what's going on here. >> It's the classic Facebook issue, you're the product, and the data is your product. Well, I want to get into what this means, 'cause my personal take away, not knowing the specifics, and just following say, cyber security for instance, one of the tenets there is that data sharing is an invaluable, important ethos in the community. Now, everyone has their own privacy, or security data, they don't want to let everyone know about their exploits but, but it's well known in the security world that sharing data with each other, different companies and countries is actually a good thing. So, the question that comes in my mind, is this really about data sharing or data privacy, or both? >> I think it's about both. And actually what the ruling is saying here is, all we're asking from the European side is please stop spying on us and please give us a level of equal protection that you give to your own citizens. Because data comes from America to Europe, whatever that data belongs to, a U.S. citizen or a European citizen, it's given equal protection. It is only if data goes in the other direction, where you have secret courts, secret warrants, seizure of data on this massive scale, and also a level of lack of equivalence that has been imposed. And we're just asking that once you've sorted out a few of those things, we'd say everything's back on the table, away we go again! >> Why don't we merge the EU with the United States? Wouldn't that solve the problem? (Bill laughing) >> We just left Europe! (laughs heartily) >> Actually I always -- >> A hostile takeover of the UK maybe, the 52nd state. (Bill laughing loudly) >> I always pick on Bill, like Bill, you got all screaming loud and clear about all these concerns, but UKs trying to get out of that economic union. It is a union at the end of the day, and I think the problem is the institutional mismatch between the EU and U.S., U.S. is old democracy, bigger country, population wise, bigger economy. Whereas Europe is several countries trying to put together, band together as one entity, and the institutions are new, like you know, they're 15 years old, right? They're maturing. I think that's where the big mismatch is and -- >> Well, Ray, I want to get your thoughts on this, Ray wrote a book, I forget what year it was, this digital disruption, basically it was digital transformation before it was actually a trend. I mean to me it's like, do you do the process first and then figure out where the value extraction is, and this may be a Silicon Valley or an American thing, but go create value, then figure out how to create process or understand regulations. So, if data and entrepreneurship is going to be a new modern era of value, why wouldn't we want to create a rule based system that's open and enabling, and not restrictive? >> So, that's a great point, right? And the innovation culture means you go do it first, and you figure out the rules later, and that's been a very American way of getting things done, and very Silicon Valley in our perspective, not everyone, but I think in general that's kind of the trend. I think the challenge here is that we are trading privacy for security, privacy for convenience, privacy for personalization, right? And on the security level, it's a very different conversation than what it is on the consumer end, you know, personalization side. On the security side I think most Americans are okay with a little bit of "spying," at least on your own side, you know, to keep the country safe. We're not okay with a China level type of spying, which we're not sure exactly what that means or what's enforceable in the courts. We look like China to the Europeans in the way we treat privacy, and I think that's the perspective we need to understand because Europeans are very explicit about how privacy is being protected. And so this really comes back to a point where we actually have to get to a consent model on privacy, as to knowing what data is being shared, you have the right to say no, and when you have the right to say no. And then if you have a value exchange on that data, then it's really like sometimes it's monetary, sometimes it's non-monetary, sometimes there's other areas around consensus where you can actually put that into place. And I think that's what's missing at this point, saying, you know, "Do we pay for your data? Do we explicitly get your consent first before we use it?" And we haven't had that in place, and I think that's where we're headed towards. And you know sometimes we actually say privacy should be a human right, it is in the UN Charter, but we haven't figured out how to enforce it or talk about it in the digital age. And so I think that's the challenge. >> Okay, people, until they lose it, they don't really understand what it means. I mean, look at Americans. I have to say that we're idiots on this front, (Bill chuckling) but you know, the thing is most people don't even understand how much value's getting sucked out of their digital exhaust. Like, our kids, TikTok and whatnot. So I mean, I get that, I think there's some, there's going to be blow back for America for sure. I just worry it's going to increase the cost of doing business, and take away from the innovation for citizen value, the people, because at the end of the day, it's for the people right? I mean, at the end of the day it's like, what's my privacy mean if I lose value? >> Even before we start talking about the value of the data and the innovation that we can do through data use, you have to understand the European perspective here. For the European there's a level of double standards and an erosion of trust. There's double standards in the fact that in California you have new privacy regulations that are slightly different to GDPR, but they're very much GDPR like. And if the boot was on the other foot, to say if we were spying on Californians and looking at their personal data, and contravening CCPA, the Californians would be up in arms! Likewise if we having promised to have a level of equality, had enacted a local rule in Europe that said that when data from America's over here, actually the privacy of Americans counts for nothing, we're only going to prioritize the privacy of Europeans. Again, the Americans would be up in arms! And therefore you can see that there are real double standards here that are a massive issue, and until those addressed, we're not going to trust the Americans. And likewise, the very fact that on a number of occasions Americans have signed up to treaties and promised to protect our data as they did with Safe Harbor, as they did with Privacy Shield, and then have blatantly, blatantly failed to do so means that actually to get back to even a level playing field, where we were, you have a great deal of trust to overcome! And the thing from the perspective of the big IT firms, they've seen this coming for a long time, as Ray was saying, and they sought to try and have a presence in Europe and other things. But the way this ruling has gone is that, I'm sorry, that isn't going to be sufficient! These big IT firms based in the U.S. that have been happy to hand over data, well some of them maybe more happy than others, but they all need to hand over data to the NSA or the CIA. They've been doing this for some time now without actually respecting this data privacy agreement that has existed between the two trading blocks. And now they've been called out, and the position now is that the U.S. is no longer trusted, and neither are any of these large American technology firms. And until the snooping stops and equality is introduced, they can now no longer, even from their European operations, they can no longer use standard contractual clauses to transfer data, which is going to be a massive restriction on their business. And if they had any sense, they'd be lobbying very, very hard right now to the Senate, to the House, to try and persuade U.S. lawmakers actually to stick to some these treaties! To stop introducing really mad laws that ride roughshod over other people's privacy, and have a certain amount of respect. >> Let's let JD weigh in, 'cause he just got in, sorry on the video, I made him back on a host 'cause he dropped off. Just, Bill, real quick, I mean I think it's like when, you know, I go to Europe there's the line for Americans, there's the line for EU. Or EU and everybody else. I mean we might be there, but ultimately this has to be solved. So, JD, I want to let you weigh in, Germany has been at the beginning forefront of privacy, and they've been hardcore, and how's this all playing out in your perspective? >> Well, the first thing that we have to understand is that in Germany, there is a very strong law for regulation. Germans panic as soon as they know regulation, so they need to understand what am I allowed to do, and what am I not allowed to do. And they expect the same from the others. For the record I'm not German, but I live in Germany for some 20 years, so I got a bit of a feeling for them. And that sense of need for regulation has spread very fast throughout the European Union, because most of the European member states of the European Union consider this, that it makes sense, and then we found that Britain had already a very good framework for privacy, so GDPR itself is very largely based on what the United Kingdom already had in place with their privacy act. Moving forward, we try to find agreement and consensus with other countries, especially the United States because that's where most of the tech providers are, only to find out, and that is where it started to go really, really bad, 2014, when the mass production by Edward Snowden came out, to find out it's not data from citizens, it's surveillance programs which include companies. I joined a purchasing conference a few weeks ago where the purchase of a large European multinational, where the purchasing director explicitly stated that usage of U.S. based tech providers for sensitive data is prohibited as a result of them finding out that they have been under surveillance. So, it's not just the citizens, there's mass -- >> There you have it, guys! We did trust you! We did have agreements there that you could have abided by, but you chose not to, you chose to abuse our trust! And you're now in a position where you are no longer trusted, and unless you can lobby your own elected representatives to actually recreate a level playing field, we're not going to continue trusting you. >> So, I think really I -- >> Well I mean that, you know, innovation has to come from somewhere, and you know, has to come from America if that's the case, you guys have to get on board, right? Is that what it -- >> Innovation without trust? >> Is that the perspective? >> I don't think it's a country thing, I mean like, it's not you or them, I think everybody -- >> I'm just bustin' Bill's chops there. >> No, but I think everybody, everybody is looking for what the privacy rules are, and that's important. And you can have that innovation with consent, and I think that's really where we're going to get to. And this is why I keep pushing that issue. I mean, privacy should be a fundamental right, and how you get paid for that privacy is interesting, or how you get compensated for that privacy if you know what the explicit value exchange is. What you're talking about here is the surveillance that's going on by companies, which shouldn't be happening, right? That shouldn't be happening at the company level. At the government level I can understand that that is happening, and I think those are treaties that the governments have to agree upon as to how much they're going to impinge on our personal privacy for the trade off for security, and I don't think they've had those discussions either. Or they decided and didn't tell any of their citizens, and I think that's probably more likely the case. >> I mean, I think what's happening here, Bill, you guys were pointing out, and Ray, you articulated there on the other side, and my kind of colorful joke aside, is that we're living a first generation modern sociology problem. I mean, this is a policy challenge that extends across multiple industries, cyber security, citizen's rights, geopolitical. I mean when would look, and even when we were doing CUBE events overseas in Europe, in North American companies we'd call it abroad, we'd just recycle the American program, and we found there's so much localization value. So, Ray, this is the digital disruption, it's the virtualization of physical for digital worlds, and it's a lot of network theory, which is computer science, a lot of sociology. This is a modern challenge, and I don't think it so much has a silver bullet, it's just that we need smart people working on this. That's my take away! >> I think we can describe the ideal endpoint being somewhere we have meaningful protection alongside the maximization of economic and social value through innovation. So, that should be what we would all agree would be the ideal endpoint. But we need both, we need meaningful protection, and we need the maximization of economic and social value through innovation! >> Can I add another axis? Another axis, security as well. >> Well, I could -- >> I put meaningful protection as becoming both security and privacy. >> Well, I'll speak for the American perspective here, and I won't speak, 'cause I'm not the President of the United States, but I will say as someone who's been from Silicon Valley and the east coast as a technical person, not a political person, our lawmakers are idiots when it comes to tech, just generally. (Ray laughing) They're not really -- (Bill laughing loudly) >> They really don't understand. They really don't understand the tech at all! >> So, the problem is -- >> I'm not claiming ours are a great deal better. (laughs) >> Well, this is why I think this is a modern problem. Like, the young people I talk to are like, "Why do we have this rules?" They're all lawyers that got into these positions of Congress on the American side, and so with the American JEDI Contract you guys have been following very closely is, it's been like the old school Oracle, IBM, and then Amazon is leading with an innovative solution, and Microsoft has come in and re-pivoted. And so what you have is a fight for the digital future of citizenship! And I think what's happening is that we're in a massive societal transition, where the people in charge don't know what the hell they're talkin' about, technically. And they don't know who to tap to solve the problems, or even shape or frame the problems. Now, there's pockets of people that are workin' on it, but to me as someone who looks at this saying, it's a pretty simple solution, no one's ever seen this before. So, there's a metaphor you can draw, but it's a completely different problem space because it's, this is all digital, data's involved. >> We've got a lobbyists out there, and we've got some tech firms spending an enormous amount of lobbying. If those lobbyists aren't trying to steer their representatives in the right direction to come up with law that aren't going to massively undermine trade and data sharing between Europe and America, then they're making a big mistake, because we got here through some really dumb lawmaking in the U.S., I mean, there are none of the laws in Europe that are a problem here. 'Cause GDPR isn't a great difference, a great deal different from some of the laws that we have already in California and elsewhere. >> Bill, Bill. >> The laws that are at issue here -- >> Bill, Bill! You have to like, back up a little bit from that rhetoric that EU is perfect and U.S. is not, that's not true actually. >> I'm not saying we're perfect! >> No, no, you say that all the time. >> But I'm saying there's a massive lack of innovation. Yeah, yeah. >> I don't, I've never said it! >> Arm wrestle! >> Yes, yes. >> When I'm being critical of some of the dumb laws in the U.S, (Sarbjeet laughing) I'm not saying Europe is perfect. What we're trying to say is that in this particular instance, I said there was an equal balance here between meaningful protection and the maximization of economic and social value. On the meaningful protection side, America's got it very wrong in terms of the meaningful protection it provides to civil European data. On the maximization of economic and social value, I think Europe's got it wrong. I think there are a lot of things we could do in Europe to actually have far more innovation. >> Yeah. >> It's a cultural issue. The Germans want rules, that's what they crave for. America's the other way, we don't want rules, I mean, pretty much is a rebel society. And that's kind of the ethos of most tech companies. But I think you know, to me the media, there's two things that go on with this tech business. The company's themselves have to be checked by say, government, and I believe in not a lot of regulation, but enough to check the power of bad actors. Media so called "checking power", both of these major roles, they don't really know what they're talking about, and this is back to the education piece. The people who are in the media so called "checking power" and the government checking power assume that the companies are bad. Right, so yeah, because eight out of ten companies like Amazon, actually try to do good things. If you don't know what good is, you don't really, (laughs) you know, you're in the wrong game. So, I think media and government have a huge education opportunity to look at this because they don't even know what they're measuring. >> I support the level of innovation -- >> I think we're unreeling from the globalization. Like, we are undoing the globalization, and that these are the side effects, these conflicts are a side effect of that. >> Yeah, so all I'm saying is I support the focus on innovation in America, and that has driven an enormous amount of wealth and value. What I'm questioning here is do you really need to spy on us, your allies, in order to help that innovation? And I'm starting to, I mean, do you need mass surveillance of your allies? I mean, I can see you may want to have some surveillance of people who are a threat to you, but wait, guys, we're meant to be on your side, and you haven't been treating our privacy with a great deal of respect! >> You know, Saudi Arabia was our ally. You know, 9/11 happened because of them, their people, right? There is no ally here, and there is no enemy, in a way. We don't know where the rogue actors are sitting, like they don't know, they can be within the walls -- >> It's well understood I think, I agree, sorry. it's well understood that nation states are enabling terrorist groups to take out cyber attacks. That's well known, the source enables it. So, I think there's the privacy versus -- >> I'm not sure it's true in your case that it's Europeans that's doing this though. >> No, no, well you know, they share -- >> I'm a former officer in the Royal Navy, I've stood shoulder to shoulder with my U.S. counterparts. I put my life on the line on NATO exercises in real war zones, and I'm now a disabled ex-serviceman as a result of that. I mean, if I put my line on the line shoulder to shoulder with Americans, why is my privacy not respected? >> Hold on -- >> I feel it's, I was going to say actually that it's not that, like even the U.S., right? Part of the spying internally is we have internal actors that are behaving poorly. >> Yeah. >> Right, we have Marxist organizations posing as, you know, whatever it is, I'll leave it at that. But my point being is we've got a lot of that, every country has that, every country has actors and citizens and people in the system that are destined to try to overthrow the system. And I think that's what that surveillance is about. The question is, we don't have treaties, or we didn't have your explicit agreements. And that's why I'm pushing really hard here, like, they're separating privacy versus security, which is the national security, and privacy versus us as citizens in terms of our data being basically taken over for free, being used for free. >> John: I agree with that. >> That I think we have some agreement on. I just think that our governments haven't really had that conversation about what surveillance means. Maybe someone agreed and said, "Okay, that's fine. You guys can go do that, we won't tell anybody." And that's what it feels like. And I don't think we deliberately are saying, "Hey, we wanted to spy on your citizens." I think someone said, "Hey, there's a benefit here too." Otherwise I don't think the EU would have let this happen for that long unless Max had made that case and started this ball rolling, so, and Edward Snowden and other folks. >> Yeah, and I totally support the need for security. >> I want to enter the -- >> I mean we need to, where there are domestic terrorists, we need to stop them, and we need to have local action in UK to stop it happening here, and in America to stop it happening there. But if we're doing that, there is absolutely no need for the Americans to be spying on us. And there's absolutely no need for the Americans to say that privacy applies to U.S. citizens only, and not to Europeans, these are daft, it's just daft! >> That's a fair point. I'm sure GCHQ and everyone else has this covered, I mean I'm sure they do. (laughs) >> Oh, Bill, I know, I've been involved, I've been involved, and I know for a fact the U.S. and the UK are discussing I know a company called IronNet, which is run by General Keith Alexander, funded by C5 Capital. There's a lot of collaboration, because again, they're tryin' to get their arms around how to frame it. And they all agree that sharing data for the security side is super important, right? And I think IronNet has this thing called Iron Dome, which is essentially like they're saying, hey, we'll just consistency around the rules of shared data, and we can both, everyone can have their own little data. So, I think there's recognition at the highest levels of some smart people on both countries. (laughs) "Hey, let's work together!" The issue I have is just policy, and I think there's a lot of clustering going on. Clustered here around just getting out of their own way. That's my take on that. >> Are we a PG show? Wait, are we a PG show? I just got to remember that. (laughs) (Bill laughing) >> It's the internet, there's no regulation, there's no rules! >> There's no regulation! >> The European rules or is it the American rules? (Ray laughing) >> I would like to jump back quickly to the purpose of the surveillance, and especially when mass surveillance is done under the cover of national security and terror prevention. I worked with five clients in the past decade who all have been targeted under mass surveillance, which was revealed by Edward Snowden, and when they did their own investigation, and partially was confirmed by Edward Snowden in person, they found out that their purchasing department, their engineering department, big parts of their pricing data was targeted in mass surveillance. There's no way that anyone can explain me that that has anything to do with preventing terror attacks, or finding the bad guys. That is economical espionage, you cannot call it in any other way. And that was authorized by the same legislation that authorizes the surveillance for the right purposes. I'm all for fighting terror, and anything that can help us prevent terror from happening, I would be the first person to welcome it. But I do not welcome when that regulation is abused for a lot of other things under the cover of national interest. I understand -- >> Back to the lawmakers again. And again, America's been victim to the Chinese some of the individual properties, well documented, well known in tech circles. >> Yeah, but just 'cause the Chinese have targeted you doesn't give you free right to target us. >> I'm not saying that, but its abuse of power -- >> If the U.S. can sort out a little bit of reform, in the Senate and the House, I think that would go a long way to solving the issues that Europeans have right now, and a long way to sort of reaching a far better place from which we can all innovate and cooperate. >> Here's the challenge that I see. If you want to be instrumenting everything, you need a closed society, because if you have a free country like America and the UK, a democracy, you're open. If you're open, you can't stop everything, right? So, there has to be a trust, to your point, Bill. As to me that I'm just, I just can't get my arms around that idea of complete lockdown and data surveillance because I don't think it's gettable in the United States, like it's a free world, it's like, open. It should be open. But here we've got the grids, and we've got the critical infrastructure that should be protected. So, that's one hand. I just can't get around that, 'cause once you start getting to locking down stuff and measuring everything, that's just a series of walled gardens. >> So, to JD's point on the procurement data and pricing data, I have been involved in some of those kind of operations, and I think it's financial espionage that they're looking at, financial security, trying to figure out a way to track down capital flows and what was purchased. I hope that was it in your client's case, but I think it's trying to figure out where the money flow is going, more so than trying to understand the pricing data from competitive purposes. If it is the latter, where they're stealing the competitive information on pricing, and data's getting back to a competitor, that is definitely a no-no! But if it's really to figure out where the money trail went, which is what I think most of those financial analysts are doing, especially in the CIA, or in the FBI, that's really what that probably would have been. >> Yeah, I don't think that the CIA is selling the data to your competitors, as a company, to Microsoft or to Google, they're not selling it to each other, right? They're not giving it to each other, right? So, I think the one big problem I studied with FISA is that they get the data, but how long they can keep the data and how long they can mine the data. So, they should use that data as exhaust. Means like, they use it and just throw it away. But they don't, they keep mining that data at a later date, and FISA is only good for five years. Like, I learned that every five years we revisit that, and that's what happened this time, that we renewed it for six years this time, not five, for some reason one extra year. So, I think we revisit all these laws -- >> Could be an election cycle. >> Huh? >> Could be an election cycle maybe. (laughs) >> Yes, exactly! So, we revisit all these laws with Congress and Senate here periodically just to make sure that they are up to date, and that they're not infringing on human rights, or citizen's rights, or stuff like that. >> When you say you update to check they're not conflicting with anything, did you not support that it was conflicting with Privacy Shield and some of the promises you made to Europeans? At what point did that fail to become obvious? >> It does, because there's heightened urgency. Every big incident happens, 9/11 caused a lot of new sort of like regulations and laws coming into the picture. And then the last time, that the Russian interference in our election, that created some sort of heightened urgency. Like, "We need to do something guys here, like if some country can topple our elections, right, that's not acceptable." So, yeah -- >> And what was it that your allies did that caused you to spy on us and to downgrade our privacy? >> I'm not expert on the political systems here. I think our allies are, okay, loose on their, okay, I call it village politics. Like, world is like a village. Like it's so only few countries, it's not millions of countries, right? That's how I see it, a city versus a village, and that's how I see the countries, like village politics. Like there are two camps, like there's Russia and China camp, and then there's U.S. camp on the other side. Like, we used to have Russia and U.S., two forces, big guys, and they managed the whole world balance somehow, right? Like some people with one camp, the other with the other, right? That's how they used to work. Now that Russia has gone, hold on, let me finish, let me finish. >> Yeah. >> Russia's gone, there's this void, right? And China's trying to fill the void. Chinese are not like, acting diplomatic enough to fill that void, and there's, it's all like we're on this imbalance, I believe. And then Russia becomes a rogue actor kind of in a way, that's how I see it, and then they are funding all these bad people. You see that all along, like what happened in the Middle East and all that stuff. >> You said there are different camps. We thought we were in your camp! We didn't expect to be spied on by you, or to have our rights downgraded by you. >> No, I understand but -- >> We thought we were on your side! >> But, but you have to guys to trust us also, like in a village. Let me tell you, I come from a village, that's why I use the villager as a hashtag in my twitter also. Like in village, there are usually one or two families which keep the village intact, that's our roles. >> Right. >> Like, I don't know if you have lived in a village or not -- >> Well, Bill, you're making some great statements. Where's the evidence on the surveillance, where can people find more information on this? Can you share? >> I think there's plenty of evidence, and I can send some stuff on, and I'm a little bit shocked given the awareness of the FISA Act, the Cloud Act, the fact that these things are in existence and they're not exactly unknown. And many people have been complaining about them for years. I mean, we've had Safe Harbor overturned, we've had Privacy Shield overturned, and these weren't just on a whim! >> Yeah, what does JD have in his hand? I want to know. >> The Edward Snowden book! (laughs) >> By Edward Snowden, which gives you plenty. But it wasn't enough, and it's something that we have to keep in mind, because we can always claim that whatever Edward Snowden wrote, that he made it up. Every publication by Edward Snowden is an avalanche of technical confirmation. One of the things that he described about the Cisco switches, which Bill prefers to quote every time, which is a proven case, there were bundles of researchers saying, "I told you guys!" Nobody paid attention to those researchers, and Edward Snowden was smart enough to get the mass media representation in there. But there's one thing, a question I have for Sabjeet, because in the two parties strategy, it is interesting that you always take out the European Union as part. And the European Union is a big player, and it will continue to grow. It has a growing amount of trade agreements with a growing amount of countries, and I still hope, and I think think Bill -- >> Well, I think the number of countries is reducing, you've just lost one! >> Only one. (Bill laughing loudly) Actually though, those are four countries under one kingdom, but that's another point. (Bill chortling heartily) >> Guys, final topic, 5G impact, 'cause you mentioned Cisco, couldn't help think about -- >> Let me finish please my question, John. >> Okay, go ahead. How would you the United States respond if the European Union would now legalize to spy on everybody and every company, and every governmental institution within the United States and say, "No, no, it's our privilege, we need that." How would the United States respond? >> You can try that and see economically what happens to you, that's how the village politics work, you have to listen to the mightier than you, and we are economically mightier, that's the fact. Actually it's hard to swallow fact for, even for anybody else. >> If you guys built a great app, I would use it, and surveil all you want. >> Yeah, but so this is going to be driven by the economics. (John laughing) But the -- >> That's exactly what John said. >> This is going to be driven by the economics here. The big U.S. cloud firms are got to find this ruling enormously difficult for them, and they are inevitably going to lobby for a level of reform. And I think a level of a reform is needed. Nobody on your side is actually arguing very vociferously that the Cloud Act and the discrimination against Europeans is actually a particularly good idea. The problem is that once you've done the reform, are we going to believe you when you say, "Oh, it's all good now, we've stopped it!" Because with Crypto AG scandal in Switzerland you weren't exactly honest about what you were doing. With the FISA courts, so I mean FISA secret courts, the secret warrants, how do we know and what proof can we have that you've stopped doing all these bad things? And I think one of the challenges, A, going to be the reform, and then B, got to be able to show that you actually got your act together and you're now clean. And until you can solve those two, many of your big tech companies are going to be at a competitive disadvantage, and they're going to be screaming for this reform. >> Well, I think that, you know, General Mattis said in his book about Trump and the United states, is that you need alliances, and I think your point about trust and executing together, without alliances, it really doesn't work. So, unless there's some sort of real alliance, (laughs) like understanding that there's going to be some teamwork here, (Bill laughing) I don't think it's going to go anywhere. So, otherwise it'll continue to be siloed and network based, right? So to the village point, if TikTok can become a massively successful app, and they're surveilling, so and then we have to decide that we're going to put up with that, I mean, that's not my decision, but that's what's goin' on here. It's like, what is TikTok, is it good or bad? Amazon sent out an email, and they've retracted it, that's because it went public. I guarantee you that they're talkin' about that at Amazon, like, "Why would we want infiltration by the Chinese?" And I'm speculating, I have no data, I'm just saying, you know. They email those out, then they pull it back, "Oh, we didn't mean to send that." Really, hmm? (laughs) You know, so this kind of -- >> But the TRA Balin's good, you always want to get TRA Balin out there. >> Yeah, exactly. There's some spying going on! So, this is the reality. >> So, John, you were talking about 5G, and I think you know, the role of 5G, you know, the battle between Cisco and Huawei, you just have to look at it this way, would you rather have the U.S. spy on you, or would you rather have China? And that's really your binary choice at this moment. And you know both is happening, and so the question is which one is better. Like, the one that you're in alliance with? The one that you're not in alliance with, the one that wants to bury you, and decimate your country, and steal all your secrets and then commercialize 'em? Or the one kind of does it, but doesn't really do it explicitly? So, you've got to choose. (laughs) >> It's supposed to be -- >> Or you can say no, we're going to create our own standard for 5G and kick both out, that's an option. >> It's probably not as straightforward a question as, or an answer to that question as you say, because if we were to fast-forward 50 years, I would argue that China is going to be the largest trading nation in the world. I believe that China is going to have the upper hand on many of these technologies, and therefore why would we not want to use some of their innovation, some of their technology, why would we not actually be more orientated around trading with them than we might be with the U.S.? I think the U.S. is throwing its weight around at this moment in time, but if we were to fast-forward I think looking in the longterm, if I had to put my money on Huawei or some of its competitors, I think given its level of investments in research and whatever, I think the better longterm bet is Huawei. >> No, no, actually you guys need to pick a camp. It's a village again. You have to pick a camp, you can't be with both guys. >> Global village. >> Oh, right, so we have to go with the guys that have been spying on us? >> How do you know the Chinese haven't been spying on you? (Ray and John laughing loudly) >> I think I'm very happy, you find a backdoor in the Huawei equipment and you show it to us, we'll take them to task on it. But don't start bullying us into making decisions based on what-ifs. >> I don't think I'm, I'm not qualified to represent the U.S., but what we would want to say is that if you look at the dynamics of what's going on, China, we've been studying that as well in terms of the geopolitical aspects of what happens in technology, they have to do what they're doing right now. Because in 20 years our population dynamics go like this, right? You've got the one child policy, and they won't have the ability to go out and fight for those same resources where they are, so what they're doing makes sense from a country perspective and country policy. But I think they're going to look like Japan in 20 years, right? Because the xenophobia, the lack of immigration, the lack of inside stuff coming in, an aging population. I mean, those are all factors that slow down your economy in the long run. And the lack of bringing new people in for ideas, I mean that's part of it, they're a closed system. And so I think the longterm dynamics of every closed system is that they tend to fail versus open systems. So, I'm not sure, they may have better technology along the way. But I think a lot of us are probably in the camp now thinking that we're not going to aid and abet them, in that sense to get there. >> You're competing a country with a company, I didn't say that China had necessarily everything rosy in its future, it'll be a bigger economy, and it'll be a bigger trading partner, but it's got its problems, the one child policy and the repercussions of that. But that is not one of the things, Huawei, I think Huawei's a massively unlimited company that has got a massive lead, certainly in 5G technology, and may continue to maintain a lead into 6G and beyond. >> Oh yeah, yeah, Huawei's done a great job on the 5G side, and I don't disagree with that. And they're ahead in many aspects compared to the U.S., and they're already working on the 6G technologies as well, and the roll outs have been further ahead. So, that's definitely -- >> And they've got a great backer too, the financer, the country China. Okay guys, (Ray laughing) let's wrap up the segment. Thanks for everyone's time. Final thoughts, just each of you on this core issue of the news that we discussed and the impact that was the conversation. What's the core issue? What should people think about? What's your solution? What's your opinion of how this plays out? Just final statements. We'll start with Bill, Ray, Sarbjeet and JD. >> All I'm going to ask you is stop spying on us, treat us equally, treat us like the allies that we are, and then I think we've got to a bright future together! >> John: Ray? >> I would say that Bill's right in that aspect in terms of how security agreements work, I think that we've needed to be more explicit about those. I can't represent the U.S. government, but I think the larger issue is really how do we view privacy, and how we do trade offs between security and convenience, and you know, what's required for personalization, and companies that are built on data. So, the sooner we get to those kind of rules, an understanding of what's possible, what's a consensus between different countries and companies, I think the better off we will all be a society. >> Yeah, I believe the most important kind of independence is the economic independence. Like, economically sound parties dictate the terms, that's what U.S. is doing. And the smaller countries have to live with it or pick the other bigger player, number two in this case is China. John said earlier, I think, also what JD said is the fine balance between national security and the privacy. You can't have, you have to strike that balance, because the rogue actors are sitting in your country, and across the boundaries of the countries, right? So, it's not that FISA is being fought by Europeans only. Our internal people are fighting that too, like how when you are mining our data, like what are you using it for? Like, I get concerned too, when you can use that data against me, that you have some data against me, right? So, I think it's the fine balance between security and privacy, we have to strike that. Awesome. JD? I'll include a little fake check, fact check, at the moment China is the largest economy, the European Union is the second largest economy, followed directly by the USA, it's a very small difference, and I recommend that these two big parties behind the largest economy start to collaborate and start to do that eye to eye, because if you want to balance the economical and manufacturing power of China, you cannot do that as being number two and number three. You have to join up forces, and that starts with sticking with the treaties that you signed, and that has not happened in the past, almost four years. So, let's go back to the table, let's work on rules where from both sides the rights and the privileges are properly reflected, and then do the most important thing, stick to them! >> Yep, I think that's awesome. I think I would say that these young kids in high school and college, they need to come up and solve the problems, this is going to be a new generational shift where the geopolitical landscape will change radically, you mentioned the top three there. And new alliances, new kinds of re-imagination has to be there, and from America's standpoint I'll just say that I'd like to see lawmakers have, instead of a LinkedIn handle, a GitHub handle. You know, when they all go out on campaign talk about what code they've written. So, I think having a technical background or some sort of knowledge of computer science and how the internet works with sociology and societal impact will be critical for our citizenships to advance. So, you know rather a lawyer, right so? (laughs) Maybe get some law involved in that, I mean the critical lawyers, but today most people are lawyers in American politics, but show me a GitHub handle of that congressman, that senator, I'd be impressed. So, that's what we need. >> Thanks, good night! >> Ray, you want to say something? >> I wanted to say something, because I thought the U.S. economy was 21 trillion, the EU is sittin' at about 16, and China was sitting about 14, but okay, I don't know. >> You need to do math man. >> Hey, we went over our 30 minutes time, we can do an hour with you guys, so you're still good. (laughs) >> Can't take anymore. >> No go on, get in there, go at it when you've got something to say. >> I don't think it's immaterial the exact size of the economy, I think that we're better off collaborating on even and fair terms, we are -- >> We're all better off collaborating. >> Yeah. >> Gentlemen -- >> But the collaboration has to be on equal and fair terms, you know. (laughs) >> How do you define fair, good point. Fair and balanced, you know, we've got the new -- >> We did define fair, we struck a treaty! We absolutely defined it, absolutely! >> Yeah. >> And then one side didn't stick to it. >> We will leave it right there, and we'll follow up (Bill laughing) in a later conversation. Gentlemen, you guys are good. Thank you. (relaxing electronic music)

>> Announcer: From theCUBE studios in Palo Alto, in Boston, connecting with thought leaders all around the world. This is a CUBE conversation. >> Hey, welcome back, you're ready. Jeff Frick here with theCUBE. We are still getting through the year of 2020. It's still the year of COVID and there's no end in sight I think until we get to a vaccine. That said, we're really excited to have one of our favorite guests. We haven't had him on for a while. I haven't talked to him for a long time. He used to I think have the record for the most CUBE appearances of probably any CUBE alumni. We're excited to have him joining us from his house in Palo Alto. Bill Schmarzo, you know him as the Dean of Big Data, he's got more titles. He's the chief innovation officer at Hitachi Vantara. He's also, we used to call him the Dean of Big Data, kind of for fun. Well, Bill goes out and writes a bunch of books. And now he teaches at the University of San Francisco, School of Management as an executive fellow. He's an honorary professor at NUI Galway. I think he's just, he likes to go that side of the pond and a many time author now, go check him out. His author profile on Amazon, the "Big Data MBA," "The Art of Thinking Like A Data Scientist" and another Big Data, kind of a workbook. Bill, great to see you. >> Thanks, Jeff, you know, I miss my time on theCUBE. These conversations have always been great. We've always kind of poked around the edges of things. A lot of our conversations have always been I thought, very leading edge and the title Dean of Big Data is courtesy of theCUBE. You guys were the first ones to give me that name out of one of the very first Strata Conferences where you dubbed me the Dean of Big Data, because I taught a class there called the Big Data MBA and look what's happened since then. >> I love it. >> It's all on you guys. >> I love it, and we've outlasted Strata, Strata doesn't exist as a conference anymore. So, you know, part of that I think is because Big Data is now everywhere, right? It's not the standalone thing. But there's a topic, and I'm holding in my hands a paper that you worked on with a colleague, Dr. Sidaoui, talking about what is the value of data? What is the economic value of data? And this is a topic that's been thrown around quite a bit. I think you list a total of 28 reference sources in this document. So it's a well researched piece of material, but it's a really challenging problem. So before we kind of get into the details, you know, from your position, having done this for a long time, and I don't know what you're doing today, you used to travel every single week to go out and visit customers and actually do implementations and really help people think these through. When you think about the value, the economic value, how did you start to kind of frame that to make sense and make it kind of a manageable problem to attack? >> So, Jeff, the research project was eyeopening for me. And one of the advantages of being a professor is, you have access to all these very smart, very motivated, very free research sources. And one of the problems that I've wrestled with as long as I've been in this industry is, how do you figure out what is data worth? And so what I did is I took these research students and I stick them on this problem. I said, "I want you to do some research. Let me understand what is the value of data?" I've seen all these different papers and analysts and consulting firms talk about it, but nobody's really got this thing clicked. And so we launched this research project at USF, professor Mouwafac Sidaoui and I together, and we were bumping along the same old path that everyone else got, which was inched on, how do we get data on our balance sheet? That was always the motivation, because as a company we're worth so much more because our data is so valuable, and how do I get it on the balance sheet? So we're headed down that path and trying to figure out how do you get it on the balance sheet? And then one of my research students, she comes up to me and she says, "Professor Schmarzo," she goes, "Data is kind of an unusual asset." I said, "Well, what do you mean?" She goes, "Well, you think about data as an asset. It never depletes, it never wears out. And the same dataset can be used across an unlimited number of use cases at a marginal cost equal to zero." And when she said that, it's like, "Holy crap." The light bulb went off. It's like, "Wait a second. I've been thinking about this entirely wrong for the last 30 some years of my life in this space. I've had the wrong frame. I keep thinking about this as an act, as an accounting conversation. An accounting determines valuation based on what somebody is willing to pay for." So if you go back to Adam Smith, 1776, "Wealth of Nations," he talks about valuation techniques. And one of the valuation techniques he talks about is valuation and exchange. That is the value of an asset is what someone's willing to pay you for it. So the value of this bottle of water is what someone's willing to pay you for it. So everybody fixates on this asset, valuation in exchange methodology. That's how you put it on balance sheet. That's how you run depreciation schedules, that dictates everything. But Adam Smith also talked about in that book, another valuation methodology, which is valuation in use, which is an economics conversation, not an accounting conversation. And when I realized that my frame was wrong, yeah, I had the right book. I had Adam Smith, I had "Wealth of Nations." I had all that good stuff, but I hadn't read the whole book. I had missed this whole concept about the economic value, where value is determined by not how much someone's willing to pay you for it, but the value you can drive by using it. So, Jeff, when that person made that comment, the entire research project, and I got to tell you, my entire life did a total 180, right? Just total of 180 degree change of how I was thinking about data as an asset. >> Right, well, Bill, it's funny though, that's kind of captured, I always think of kind of finance versus accounting, right? And then you're right on accounting. And we learn a lot of things in accounting. Basically we learn more that we don't know, but it's really hard to put it in an accounting framework, because as you said, it's not like a regular asset. You can use it a lot of times, you can use it across lots of use cases, it doesn't degradate over time. In fact, it used to be a liability. 'cause you had to buy all this hardware and software to maintain it. But if you look at the finance side, if you look at the pure play internet companies like Google, like Facebook, like Amazon, and you look at their valuation, right? We used to have this thing, we still have this thing called Goodwill, which was kind of this capture between what the market established the value of the company to be. But wasn't reflected when you summed up all the assets on the balance sheet and you had this leftover thing, you could just plug in goodwill. And I would hypothesize that for these big giant tech companies, the market has baked in the value of the data, has kind of put in that present value on that for a long period of time over multiple projects. And we see it captured probably in goodwill, versus being kind of called out as an individual balance sheet item. >> So I don't think it's, I don't know accounting. I'm not an accountant, thank God, right? And I know that goodwill is one of those things if I remember from my MBA program is something that when you buy a company and you look at the value you paid versus what it was worth, it stuck into this category called goodwill, because no one knew how to figure it out. So the company at book value was a billion dollars, but you paid five billion for it. Well, you're not an idiot, so that four billion extra you paid must be in goodwill and they'd stick it in goodwill. And I think there's actually a way that goodwill gets depreciated as well. So it could be that, but I'm totally away from the accounting framework. I think that's distracting, trying to work within the gap rules is more of an inhibitor. And we talk about the Googles of the world and the Facebooks of the world and the Netflix of the world and the Amazons and companies that are great at monetizing data. Well, they're great at monetizing it because they're not selling it, they're using it. Google is using their data to dominate search, right? Netflix is using it to be the leader in on-demand videos. And it's how they use all the data, how they use the insights about their customers, their products, and their operations to really drive new sources of value. So to me, it's this, when you start thinking about from an economics perspective, for example, why is the same car that I buy and an Uber driver buys, why is that car more valuable to an Uber driver than it is to me? Well, the bottom line is, Uber drivers are going to use that car to generate value, right? That $40,000, that car they bought is worth a lot more, because they're going to use that to generate value. For me it sits in the driveway and the birds poop on it. So, right, so it's this value in use concept. And when organizations can make that, by the way, most organizations really struggle with this. They struggle with this value in use concept. They want to, when you talk to them about data monetization and say, "Well, I'm thinking about the chief data officer, try not to trying to sell data, knocking on doors, shaking their tin cup, saying, 'Buy my data.'" No, no one wants your data. Your data is more valuable for how you use it to drive your operations then it's a sell to somebody else. >> Right, right. Well, on of the other things that's really important from an economics concept is scarcity, right? And a whole lot of economics is driven around scarcity. And how do you price for scarcity so that the market evens out and the price matches up to the supply? What's interesting about the data concept is, there is no scarcity anymore. And you know, you've outlined and everyone has giant numbers going up into the right, in terms of the quantity of the data and how much data there is and is going to be. But what you point out very eloquently in this paper is the scarcity is around the resources to actually do the work on the data to get the value out of the data. And I think there's just this interesting step function between just raw data, which has really no value in and of itself, right? Until you start to apply some concepts to it, you start to analyze it. And most importantly, that you have some context by which you're doing all this analysis to then drive that value. And I thought it was really an interesting part of this paper, which is get beyond the arguing that we're kind of discussing here and get into some specifics where you can measure value around a specific business objective. And not only that, but then now the investment of the resources on top of the data to be able to extract the value to then drive your business process for it. So it's a really different way to think about scarcity, not on the data per se, but on the ability to do something with it. >> You're spot on, Jeff, because organizations don't fail because of a lack of use cases. They fail because they have too many. So how do you prioritize? Now that scarcity is not an issue on the data side, but it is this issue on the people resources side, you don't have unlimited data scientists, right? So how do you prioritize and focus on those opportunities that are most important? I'll tell you, that's not a data science conversation, that's a business conversation, right? And figuring out how you align organizations to identify and focus on those use cases that are most important. Like in the paper we go through several different use cases using Chipotle as an example. The reason why I picked Chipotle is because, well, I like Chipotle. So I could go there and I could write it off as research. But there's a, think about the number of use cases where a company like Chipotle or any other company can leverage your data to drive their key business initiatives and their key operational use cases. It's almost unbounded, which by the way, is a huge challenge. In fact, I think part of the problem we see with a lot of organizations is because they do such a poor job of prioritizing and focusing, they try to solve the entire problem with one big fell swoop, right? It's slightly the old ERP big bang projects. Well, I'm just going to spend $20 million to buy this analytic capability from company X and I'm going to install it and then magic is going to happen. And then magic is going to happen, right? And then magic is going to happen, right? And magic never happens. We get crickets instead, because the biggest challenge isn't around how do I leverage the data, it's about where do I start? What problems do I go after? And how do I make sure the organization is bought in to basically use case by use case, build out your data and analytics architecture and capabilities. >> Yeah, and you start backwards from really specific business objectives in the use cases that you outline here, right? I want to increase my average ticket by X. I want to increase my frequency of visits by X. I want to increase the amount of items per order from X to 1.2 X, or 1.3 X. So from there you get a nice kind of big revenue hit that you can plan around and then work backwards into the amount of effort that it takes and then you can come up, "Is this a good investment or not?" So it's a really different way to get back to the value of the data. And more importantly, the analytics and the work to actually call out the information. >> The technologies, the data and analytic technologies available to us. The very composable nature of these allow us to take this use case by use case approach. I can build out my data lake one use case at a time. I don't need to stuff 25 data sources into my data lake and hope there's someone more valuable. I can use the first use case to say, "Oh, I need these three data sources to solve that use case. I'm going to put those three data sources in the data lake. I'm going to go through the entire curation process of making sure the data has been transformed and cleansed and aligned and enriched and met of, all the other governance, all that kind of stuff this goes on. But I'm going to do that use case by use case, 'cause a use case can tell me which data sources are most important for that given situation. And I can build up my data lake and I can build up my analytics then one use case at a time. And there is a huge impact then, huge impact when I build out use case by use case. That does not happen. Let me throw something that's not really covered in the paper, but it is very much covered in my new book that I'm working on, which is, in knowledge-based industries, the economies of learning are more powerful than the economies of scale. Now think about that for a second. >> Say that again, say that again. >> Yeah, the economies of learning are more powerful than the economies of scale. And what that means is what I learned on the first use case that I build out, I can apply that learning to the second use case, to the third use case, to the fourth use case. So when I put my data into my data lake for my first use case, and the paper covers this, well, once it's in my data lake, the cost of reusing that data in a second, third and fourth use cases is basically, you know marginal cost is zero. So I get this ability to learn about what data sets are most important and to reapply that across the organization. So this learning concept, I learn use case by use case, I don't have to do a big economies of scale approach and start with 25 datasets of which only three or four might be useful. But I'm incurring the overhead for all those other non-important data sets because I didn't take the time to go through and figure out what are my most important use cases and what data do I need to support those use cases. >> I mean, should people even think of the data per se or should they really readjust their thinking around the application of the data? Because the data in and of itself means nothing, right? 55, is that fast or slow? Is that old or young? Well, it depends on a whole lot of things. Am I walking or am I in a brand new Corvette? So it just, it's funny to me that the data in and of itself really doesn't have any value and doesn't really provide any direction into a decision or a higher order, predictive analytics until you start to manipulate the data. So is it even the wrong discussion? Is data the right discussion? Or should we really be talking about the capabilities to do stuff within and really get people focused on that? >> So Jeff, there's so many points to hit on there. So the application of data is what's the value, and the queue of you guys used to be famous for saying, "Separating noise from the signal." >> Signal from the noise. Signal from a noise, right. Well, how do you know in your dataset what's signal and what's noise? Well, the use case will tell you. If you don't know the use case and you have no way of figuring out what's important. One of the things I use, I still rail against, and it happens still. Somebody will walk up my data science team and say, "Here's some data, tell me what's interesting in it." Well, how do you separate signal from noise if I don't know the use case? So I think you're spot on, Jeff. The way to think about this is, don't become data-driven, become value-driven and value is driven from the use case or the application or the use of the data to solve that particular use case. So organizations that get fixated on being data-driven, I hate the term data-driven. It's like as if there's some sort of frigging magic from having data. No, data has no value. It's how you use it to derive customer product and operational insights that drive value,. >> Right, so there's an interesting step function, and we talk about it all the time. You're out in the weeds, working with Chipotle lately, and increase their average ticket by 1.2 X. We talk more here, kind of conceptually. And one of the great kind of conceptual holy grails within a data-driven economy is kind of working up this step function. And you've talked about it here. It's from descriptive, to diagnostic, to predictive. And then the Holy grail prescriptive, we're way ahead of the curve. This comes into tons of stuff around unscheduled maintenance. And you know, there's a lot of specific applications, but do you think we spend too much time kind of shooting for the fourth order of greatness impact, instead of kind of focusing on the small wins? >> Well, you certainly have to build your way there. I don't think you can get to prescriptive without doing predictive, and you can't do predictive without doing descriptive and such. But let me throw a really one at you, Jeff, I think there's even one beyond prescriptive. One we're talking more and more about, autonomous, a ton of analytics, right? And one of the things that paper talked about that didn't click with me at the time was this idea of orphaned analytics. You and I kind of talked about this before the call here. And one thing we noticed in the research was that a lot of these very mature organizations who had advanced from the retrospective analytics of BI to the descriptive, to the predicted, to the prescriptive, they were building one off analytics to solve a problem and getting value from it, but never reusing this analytics over and over again. They were done one off and then they were thrown away and these organizations were so good at data science and analytics, that it was easier for them to just build from scratch than to try to dig around and try to find something that was never actually ever built to be reused. And so I have this whole idea of orphaned analytics, right? It didn't really occur to me. It didn't make any sense into me until I read this quote from Elon Musk, and Elon Musk made this statement. He says, " I believe that when you buy a Tesla, you're buying an asset that appreciates in value, not depreciates through usage." I was thinking, "Wait a second, what does that mean?" He didn't actually say it, "Through usage." He said, "He believes you're buying an asset that appreciates not depreciates in value." And of course the first response I had was, "Oh, it's like a 1964 and a half Mustang. It's rare, so everybody is going to want these things. So buy one, stick it in your garage. And 20 years later, you're bringing it out and it's worth more money." No, no, there's 600,000 of these things roaming around the streets, they're not rare. What he meant is that he is building an autonomous asset. That the more that it's used, the more valuable it's getting, the more reliable, the more efficient, the more predictive, the more safe this asset's getting. So there is this level beyond prescriptive where we can think about, "How do we leverage artificial intelligence, reinforcement, learning, deep learning, to build these assets that the more that they are used, the smarter they get." That's beyond prescriptive. That's an environment where these things are learning. In many cases, they're learning with minimal or no human intervention. That's the real aha moment. That's what I miss with orphaned analytics and why it's important to build analytics that can be reused over and over again. Because every time you use these analytics in a different use case, they get smarter, they get more valuable, they get more predictive. To me that's the aha moment that blew my mind. I realized I had missed that in the paper entirely. And it took me basically two years later to realize, dough, I missed the most important part of the paper. >> Right, well, it's an interesting take really on why the valuation I would argue is reflected in Tesla, which is a function of the data. And there's a phenomenal video if you've never seen it, where they have autonomous vehicle day, it might be a year or so old. And he's got his number one engineer from, I think the Microprocessor Group, The Computer Vision Group, as well as the autonomous driving group. And there's a couple of really great concepts I want to follow up on what you said. One is that they have this thing called The Fleet. To your point, there's hundreds of thousands of these things, if they haven't hit a million, that are calling home reporting home every day as to exactly how everyone took the Northbound 101 on-ramp off of University Avenue. How fast did they go? What line did they take? What G-forces did they take? And every one of those cars feeds into the system, so that when they do the autonomous update, not only are they using all their regular things that they would use to map out that 101 Northbound entry, but they've got all the data from all the cars that have been doing it. And you know, when that other car, the autonomous car couple years ago hit the pedestrian, I think in Phoenix, which is not good, sad, killed a person, dark tough situation. But you know, we are doing an autonomous vehicle show and the guy who made a really interesting point, right? That when something like that happens, typically if I was in a car wreck or you're in a car wreck, hopefully not, I learned the person that we hit learns and maybe a couple of witnesses learn, maybe the inspector. >> But nobody else learns. >> But nobody else learns. But now with the autonomy, every single person can learn from every single experience with every vehicle contributing data within that fleet. To your point, it's just an order of magnitude, different way to think about things. >> Think about a 1% improvement compounded 365 times, equals I think 38 X improvement. The power of 1% improvements over these 600,000 plus cars that are learning. By the way, even when the autonomous FSD, the full self-driving mode module isn't turned on, even when it's not turned on, it runs in shadow mode. So it's learning from the human drivers, the human overlords, it's constantly learning. And by the way, not only they're collecting all this data, I did a little research, I pulled out some of their job search ads and they've built a giant simulator, right? And they're there basically every night, simulating billions and billions of more driven miles because of the simulator. They are building, he's going to have a simulator, not only for driving, but think about all the data he's capturing as these cars are riding down the road. By the way, they don't use Lidar, they use video, right? So he's driving by malls. He knows how many cars are in the mall. He's driving down roads, he knows how old the cars are and which ones should be replaced. I mean, he has this, he's sitting on this incredible wealth of data. If anybody could simulate what's going on in the world and figure out how to get out of this COVID problem, it's probably Elon Musk and the data he's captured, be courtesy of all those cars. >> Yeah, yeah, it's really interesting, and we're seeing it now. There's a new autonomous drone out, the Skydio, and they just announced their commercial product. And again, it completely changes the way you think about how you use that tool, because you've just eliminated the complexity of driving. I don't want to drive that, I want to tell it what to do. And so you're saying, this whole application of air force and companies around things like measuring piles of coal and measuring these huge assets that are volume metric measured, that these things can go and map out and farming, et cetera, et cetera. So the autonomy piece, that's really insightful. I want to shift gears a little bit, Bill, and talk about, you had some theories in here about thinking of data as an asset, data as a currency, data as monetization. I mean, how should people think of it? 'Cause I don't think currency is very good. It's really not kind of an exchange of value that we're doing this kind of classic asset. I think the data as oil is horrible, right? To your point, it doesn't get burned up once and can't be used again. It can be used over and over and over. It's basically like feedstock for all kinds of stuff, but the feedstock never goes away. So again, or is it that even the right way to think about, do we really need to shift our conversation and get past the idea of data and get much more into the idea of information and actionable information and useful information that, oh, by the way, happens to be powered by data under the covers? >> Yeah, good question, Jeff. Data is an asset in the same way that a human is an asset. But just having humans in your company doesn't drive value, it's how you use those humans. And so it's really again the application of the data around the use cases. So I still think data is an asset, but I don't want to, I'm not fixated on, put it on my balance sheet. That nice talk about put it on a balance sheet, I immediately put the blinders on. It inhibits what I can do. I want to think about this as an asset that I can use to drive value, value to my customers. So I'm trying to learn more about my customer's tendencies and propensities and interests and passions, and try to learn the same thing about my car's behaviors and tendencies and my operations have tendencies. And so I do think data is an asset, but it's a latent asset in the sense that it has potential value, but it actually has no value per se, inputting it into a balance sheet. So I think it's an asset. I worry about the accounting concept medially hijacking what we can do with it. To me the value of data becomes and how it interacts with, maybe with other assets. So maybe data itself is not so much an asset as it's fuel for driving the value of assets. So, you know, it fuels my use cases. It fuels my ability to retain and get more out of my customers. It fuels ability to predict what my products are going to break down and even have products who self-monitor, self-diagnosis and self-heal. So, data is an asset, but it's only a latent asset in the sense that it sits there and it doesn't have any value until you actually put something to it and shock it into action. >> So let's shift gears a little bit and start talking about the data and talk about the human factors. 'Cause you said, one of the challenges is people trying to bite off more than they can chew. And we have the role of chief data officer now. And to your point, maybe that mucks things up more than it helps. But in all the customer cases that you've worked on, is there a consistent kind of pattern of behavior, personality, types of projects that enables some people to grab those resources to apply to their data to have successful projects, because to your point there's too much data and there's too many projects and you talk a lot about prioritization. But there's a lot of assumptions in the prioritization model that you can, that you know a whole lot of things, especially if you're comparing project A over in group A with project B, with group B and the two may not really know the economics across that. But from an individual person who sees the potential, what advice do you give them? What kind of characteristics do you see, either in the type of the project, the type of the boss, the type of the individual that really lends itself to a higher probability of a successful outcome? >> So first off you need to find somebody who has a vision for how they want to use the data, and not just collect it. But how they're going to try to change the fortunes of the organization. So it always takes a visionary, may not be the CEO, might be somebody who's a head of marketing or the head of logistics, or it could be a CIO, it could be a chief data officer as well. But you've got to find somebody who says, "We have this latent asset we could be doing more with, and we have a series of organizational problem challenges against which I could apply this asset. And I need to be the matchmaker that brings these together." Now the tool that I think is the most powerful tool in marrying the latent capabilities of data with all the revenue generating opportunities in the application side, because there's a countless number, the most important tool that I found doing that is design thinking. Now, the reason why I think design thinking is so important, because one of the things that design thinking does a great job is it gives everybody a voice in the process of identifying, validating, valuing, and prioritizing use cases you're going to go after. Let me say that again. The challenge organizations have is identifying, validating, valuing, and prioritizing the use cases they want to go after. Design thinking is a marvelous tool for driving organizational alignment around where we're going to start and what's going to be next and why we're going to start there and how we're going to bring everybody together. Big data and data science projects don't die because of technology failure. Most of them die because of passive aggressive behaviors in the organization that you didn't bring everybody into the process. Everybody's voice didn't get a chance to be heard. And that one person who's voice didn't get a chance to get heard, they're going to get you. They may own a certain piece of data. They may own something, but they're just waiting and lay, they're just laying there waiting for their chance to come up and snag it. So what you got to do is you got to proactively bring these people together. We call this, this is part of our value engineering process. We have a value engineering process around envisioning where we bring all these people together. We help them to understand how data in itself is a latent asset, but how it can be used from an economics perspective, drive all those value. We get them all fired up on how these can solve any one of these use cases. But you got to start with one, and you've got to embrace this idea that I can build out my data and analytic capabilities, one use case at a time. And the first use case I go after and solve, makes my second one easier, makes my third one easier, right? It has this ability that when you start going use case by use case two really magical things happen. Number one, your marginal cost flatten. That is because you're building out your data lake one use case at a time, and you're bringing all the important data lake, that data lake one use case at a time. At some point in time, you've got most of the important data you need, and the ability that you don't need to add another data source. You got what you need, so your marginal costs start to flatten. And by the way, if you build your analytics as composable, reusable, continuous learning analytic assets, not as orphaned analytics, pretty soon you have all the analytics you need as well. So your marginal cost flatten, but effect number two is that you've, because you've have the data and the analytics, I can accelerate time to value, and I can de-risked projects as I go use case by use case. And so then the biggest challenge becomes not in the data and the analytics, it's getting the all the business stakeholders to agree on, here's a roadmap we're going to go after. This one's first, and this one is going first because it helps to drive the value of the second and third one. And then this one drives this, and you create a whole roadmap of rippling through of how the data and analytics are driving this value to across all these use cases at a marginal cost approaching zero. >> So should we have chief design thinking officers instead of chief data officers that really actually move the data process along? I mean, I first heard about design thinking years ago, actually interviewing Dan Gordon from Gordon Biersch, and they were, he had just hired a couple of Stanford grads, I think is where they pioneered it, and they were doing some work about introducing, I think it was a a new apple-based alcoholic beverage, apple cider, and they talked a lot about it. And it's pretty interesting, but I mean, are you seeing design thinking proliferate into the organizations that you work with? Either formally as design thinking or as some derivation of it that pulls some of those attributes that you highlighted that are so key to success? >> So I think we're seeing the birth of this new role that's marrying capabilities of design thinking with the capabilities of data and analytics. And they're calling this dude or dudette the chief innovation officer. Surprise. >> Title for someone we know. >> And I got to tell a little story. So I have a very experienced design thinker on my team. All of our data science projects have a design thinker on them. Every one of our data science projects has a design thinker, because the nature of how you build and successfully execute a data science project, models almost exactly how design thinking works. I've written several papers on it, and it's a marvelous way. Design thinking and data science are different sides of the same coin. But my respect for data science or for design thinking took a major shot in the arm, major boost when my design thinking person on my team, whose name is John Morley introduced me to a senior data scientist at Google. And I was bottom coffee. I said, "No," this is back in, before I even joined Hitachi Vantara, and I said, "So tell me the secret to Google's data science success? You guys are marvelous, you're doing things that no one else was even contemplating, and what's your key to success?" And he giggles and laughs and he goes, "Design thinking." I go, "What the hell is that? Design thinking, I've never even heard of the stupid thing before." He goes, "I'd make a deal with you, Friday afternoon let's pop over to Stanford's B school and I'll teach you about design thinking." So I went with him on a Friday to the d.school, Design School over at Stanford and I was blown away, not just in how design thinking was used to ideate and bring and to explore. But I was blown away about how powerful that concept is when you marry it with data science. What is data science in its simplest sense? Data science is about identifying the variables and metrics that might be better predictors of performance. It's that might phrase that's the real key. And who are the people who have the best insights into what values or metrics or KPIs you might want to test? It ain't the data scientists, it's the subject matter experts on the business side. And when you use design thinking to bring this subject matter experts with the data scientists together, all kinds of magic stuff happens. It's unbelievable how well it works. And all of our projects leverage design thinking. Our whole value engineering process is built around marrying design thinking with data science, around this prioritization, around these concepts of, all ideas are worthy of consideration and all voices need to be heard. And the idea how you embrace ambiguity and diversity of perspectives to drive innovation, it's marvelous. But I feel like I'm a lone voice out in the wilderness, crying out, "Yeah, Tesla gets it, Google gets it, Apple gets it, Facebook gets it." But you know, most other organizations in the world, they don't think like that. They think design thinking is this Wufoo thing. Oh yeah, you're going to bring people together and sing Kumbaya. It's like, "No, I'm not singing Kumbaya. I'm picking their brains because they're going to help make their data science team much more effective and knowing what problems we're going to go after and how I'm going to measure success and progress. >> Maybe that's the next Dean for the next 10 years, the Dean of design thinking instead of data science, and who knew they're one and the same? Well, Bill, that's a super insightful, I mean, it's so, is validated and supported by the trends that we see all over the place, just in terms of democratization, right? Democratization of the tools, more people having access to data, more opinions, more perspective, more people that have the ability to manipulate the data and basically experiment, does drive better business outcomes. And it's so consistent. >> If I could add one thing, Jeff, I think that what's really powerful about design thinking is when I think about what's happening with artificial intelligence or AI, there's all these conversations about, "Oh, AI is going to wipe out all these jobs. Is going to take all these jobs away." And what we're actually finding is that if we think about machine learning, driven by AI and human empowerment, driven by design thinking, we're seeing the opportunity to exploit these economies of learning at the front lines where every customer engagement, every operational execution is an opportunity to gather not only more data, but to gather more learnings, to empower the humans at the front lines of the organization to constantly be seeking, to try different things, to explore and to learn from each of these engagements. I think it's, AI to me is incredibly powerful. And I think about it as a source of driving more learning, a continuous learning and continuously adapting an organization where it's not just the machines that are doing this, but it's the humans who've been empowered to do that. And my chapter nine in my new book, Jeff, is all about team empowerment, because nothing you do with AI is going to matter of squat if you don't have empowered teams who know how to take and leverage that continuous learning opportunity at the front lines of customer and operational engagement. >> Bill, I couldn't set a better, I think we'll leave it there. That's a great close, when is the next book coming out? >> So today I do my second to last final review. Then it goes back to the editor and he does a review and we start looking at formatting. So I think we're probably four to six weeks out. >> Okay, well, thank you so much, congratulations on all the success. I just love how the Dean is really the Dean now, teaching all over the world, sharing the knowledge and attacking some of these big problems. And like all great economics problems, often the answer is not economics at all. It's completely really twist the lens and don't think of it in that, all that construct. >> Exactly. >> All right, Bill. Thanks again and have a great week. >> Thanks, Jeff. >> All right. He's Bill Schmarzo, I'm Jeff Frick. You're watching theCUBE. Thanks for watching, we'll see you next time. (gentle music)

>>from around the globe. It's the queue with digital coverage of AWS public sector online brought to you by Amazon Web services. >>Everyone welcome back to the Cube's virtual coverage of AWS Public sector summit online. That's the virtual conference. Public Sector Summit is the big get together for Teresa Carlson and her team and Amazon Web services from the public sector, which includes all the government agencies as well as education state governments here in United States and also abroad for other governments and countries. So we're gonna do an analysis of Teresa's keynote and also summarize the event as well. I'm John Furrow, your host of the Cube. I'm joined with my co host of the Cube, Dave Volante Stew Minimum. We're gonna wrap this up and analyze the keynote summit a really awkward, weird situation going on with the Summit because of the virtual nature of it. This event really prides itself. Stew and Dave. We've all done this event. It's one of our favorites. It's a really good face to face environment, but this time is virtual. And so with the covert 19 that's the backdrop to all this. >>Yeah, so I mean, a couple of things, John. I think first of all, A Z, you've pointed out many times. The future has just been pulled forward. I think the second thing is with this whole work from home in this remote thing obviously was talking about how the cloud is a tailwind. But let's face it. I mean, everybody's business was affected in some way. I think the cloud ultimately gets a tail wind out of this, but but But I think the third thing is security. Public sector is always heavily focused on security, and the security model has really changed overnight to what we've been talking about for years that the moat that we've built the perimeter is no longer where organizations need to be spending money. It's really to secure remote locations. And that literally happened overnight. So things like a security cloud become much, much more important. And obviously endpoint security and other other things that we've talked about in the Cube now for last 100 days. >>Well, Steve, I want to get your thoughts cause you know, we all love space. Do we always want to go the best space events that they're gonna be virtual this year as well? Um, But the big news out of the keynote, which was really surprising to me, is Amazon's continued double down on their efforts around space, cyber security, public and within the public sector. And they're announcing here, and the big news is a new space business segment. So they announced an aerospace group to serve those customers because space to becoming a very important observation component to a lot of the stuff we've seen with ground station we've seen at reinvent public sector. These new kinds of services are coming out. It's the best, the cloud. It's the best of data, and it's the best of these new use cases. What's your thoughts? >>Yeah, interesting. John, of course. You know, the federal government has put together Space Forces, the newest arm of the military. It's really even though something it is a punchline. There's even a Netflix show that I believe got the trademark board because they registered for it first. But we've seen Amazon pushing into space. Not only there technology being used. I had the pleasure of attending the Amazon re Marcia last year, which brought together Jeff Bezos's blue origin as well as Amazon AWS in that ecosystem. So AWS has had a number of services, like ground Station that that that are being used to help the cloud technology extend to what's happening base. So it makes a lot of sense for for the govcloud to extend to that type of environment aside you mentioned at this show. One of the things we love always is. You know, there's some great practitioner stories, and I think so many over the years that we've been doing this show and we still got some of them. Theresa had some really good guests in her keynote, talking about transformation and actually, one of the ones that she mentioned but didn't have in the keynote was one that I got to interview. I was the CTO for the state of West Virginia. If you talk about one of those government services that is getting, you know, heavy usage, it's unemployment. So they had to go from Oh my gosh, we normally had people in, you know, physical answering. The phone call centers to wait. I need to have a cloud based contact center. And they literally did that, you know, over the weekend, spun it up and pulled people from other organizations to just say, Hey, you're working from home You know you can't do your normal job Well, we can train your own, we can get it to you securely And that's the kind of thing that the cloud was really built for >>and this new aerospace division day this really highlights a lot of not just the the coolness of space, but on Earth. The benefits of there and one of Amazon's ethos is to do the heavy lifting, Andy Jassy told us on the Cube. You know, it could be more cost effective to use satellites and leverage more of that space perimeter to push down and look at observation. Cal Poly is doing some really interesting work around space. Amazon's worked with NASA Jet Propulsion Labs. They have a lot of partnerships in aerospace and space, and as it all comes together because this is now an augmentation and the cost benefits are there, this is going to create more agility because you don't have to do all that provisioning to get this going spawned. All kinds of new creativity, both an academic and commercial, your thoughts >>Well, you know, I remember the first cloud first came out people talked a lot about while I can do things that I was never able to do before, you know, The New York Times pdf example comes to mind, but but I think what a lot of people forget is you know the point to a while. A lot of these mission critical applications Oracle databases aren't moving to the cloud. But this example that you're giving and aerospace and ground station. It's all about being able to do new things that you weren't able to do before and deliver them as a service. And so, to me, it shows a great example of tam expansion, and it also shows things that you never could do before. It's not just taking traditional enterprise APs and sticking them in the cloud. Yeah, that happens. But is re imagining what you can do with computing with this massive distributed network. And you know, I O. T. Is clearly coming into into play here. I would consider this a kind of I o t like, you know, application. And so I think there are many, many more to come. But this is a great example of something that you could really never even conceive in enterprise Tech before >>you, Dave the line on that you talked about i o t talk a lot about edge computing. Well, if you talk about going into space, that's a new frontier of the edge that we need to talk about >>the world. Glad it's round. So technically no edge if you're in space so again not to get nuance here and nerdy. But okay, let's get into the event. I want to hold on the analysis of the keynote because I think this really society impact public service, public sector, things to talk about. But let's do a quick review of kind of what's happened. We'll get to the event. But let's just review the guests that we interviewed on the Cube because we have the cube virtual. We're here in our studios. You guys were in yours. We get the quarantine cruise. We're still doing our job to get the stories out there. We talked to Teresa Carlson, Shannon Kellogg, Ken Eisner, Sandy Carter, Dr Papa Casey Coleman from Salesforce, Dr Shell Gentleman from the Paragon Institute, which is doing the fairground islands of researcher on space and weather data. Um, Joshua Spence math you can use with the Alliance for Digital Innovation Around some of this new innovation, we leave the Children's National Research Institute. So a lot of great guests on the cube dot net Check it out, guys. I had trouble getting into the event that using this in Toronto platform and it was just so hard to navigate. They've been doing it before. Um, there's some key notes on there. I thought that was a disappointment for me. I couldn't get to some of the sessions I wanted to, um, but overall, I thought the content was strong. Um, the online platform just kind of wasn't there for me. What's your reaction? >>Well, I mean, it's like a Z. That's the state of the art today. And so it's essentially a webinar like platforms, and that's what everybody's saying. A lot of people are frustrated with it. I know I as a user. Activity clicks to find stuff, but it is what it is. But I think the industry is can do better. >>Yeah, and just to comment. I'll make on it, John. One of things I always love about the Amazon show. It's not just what AWS is doing, But, you know, you walk the hallways and you walk the actual So in the virtual world, I walk the expo floor and its okay, Here's a couple of presentations links in an email address if you want to follow up, I felt even the A previous AWS online at a little bit more there. And I'm sure Amazon's listening, talking to all their partners and building out more there cause that's definitely a huge opportunity to enable both networking as well. As you know, having the ecosystem be able to participate more fully in the event >>and full disclosure. We're building our own platform. We have the platforms. We care about this guys. I think that on these virtual events that the discovery is critical having the available to find the sessions, find the people so it feels more like an event. I think you know, we hope that these solutions can get better. We're gonna try and do our best. Um, so, um well, keep plugging away, guys. I want to get your thoughts. They have you been doing a lot of breaking analysis on this do and your interviews as well in the technology side around the impact of Covert 19 with Teresa Carlson and her keynote. Her number one message that I heard was Covad 19 Crisis has caused a imperative for all agencies to move faster, and Amazon is kind of I won't say put things to the side because they got their business at scale. Have really been honing in on having deliverables for crisis solutions. Solving the problems and getting out to Steve mentioned the call centers is one of the key interviews. This is that they're job. They have to do this cove. It impacts the public services of the public sector that she's that they service. So what's your reaction? Because we've been covering on the commercial side. What's your thoughts of Teresa and Amazon's story today? >>Yeah, well, she said, You know, the agencies started making cloud migrations that they're at record pace that they'd never seen before. Having said that, you know it's hard, but Amazon doesn't break out its its revenue in public sector. But in the data, I look at the breaking analysis CTR data. I mean, it definitely suggests a couple of things. Things one is I mean, everybody in the enterprise was affected in some way by Kobe is they said before, it wouldn't surprise me if there wasn't a little bit of a pause and aws public sector business and then it's picking up again now, as we sort of exit this isolation economy. I think the second thing I would say is that AWS Public sector, based on the data that I see, is significantly outpacing the growth of AWS. Overall number one number two. It's also keeping pace with the growth of Microsoft Azure. Now we know that AWS, on balance is much bigger than Microsoft Azure and Infrastructures of Service. But we also know that Microsoft Azure is growing faster. That doesn't seem to be the case in public sector. It seems like the public sector business is is really right there from in terms of growth. So it really is a shining star inside of AWS. >>Still, speed is a startup game, and agility has been a dev ops ethos. You couldn't see more obvious example in public sector where speed is critical. What's your reaction to your interviews and your conversations and your observations? A keynote? >>Yeah, I mean something We've all been saying in the technology industry is Just imagine if this had happened under 15 years ago, where we would be So where in a couple of the interviews you mentioned, I've talked to some of the non profits and researchers working on covert 19. So the cloud really has been in the spotlight. Can I react? Bask scale. Can I share information fast while still maintaining the proper regulations that are needed in the security so that, you know, the cloud has been reacting fast when you talk about the financial resource is, it's really nice to see Amazon in some of these instances has been donating compute occasional resource is and the like, so that you know, critical universities that are looking at this when researchers get what they need and not have to worry about budgets, other agencies, if you talk about contact centers, are often they will get emergency funding where they have a way to be able to get that to scale, since they weren't necessarily planning for these expenses. So you know what we've been seeing is that Cloud really has had the stress test with everything that's been going on here, and it's reacting, so it's good to see that you know, the promise of cloud is meeting that scale for the most part, Amazon doing a really good job here and you know, their customers just, you know, feel The partnership with Amazon is what I've heard loud and clear. >>Well, Dave, one of these I want to get your reaction on because Amazon you can almost see what's going on with them. They don't want to do their own horn because they're the winners on the pandemic. They are doing financially well, their services. All the things that they do scale their their their position, too. Take advantage. Business wise of of the remote workers and the customers and agencies. They don't have the problems at scale that the customers have. So a lot of things going on here. These applications that have been in the i t world of public sector are old, outdated, antiquated, certainly summer modernize more than others. But clearly 80% of them need to be modernized. So when a pandemic hits like this, it becomes critical infrastructure. Because look at the look of the things unemployment checks, massive amount of filings going on. You got critical service from education remote workforces. >>these are >>all exposed. It's not just critical. Infrastructure is plumbing. It's The applications are critical. Legit problems need to be solved now. This is forcing an institutional mindset that's been there for years of, like, slow two. Gotta move fast. I mean, this is really your thoughts. >>Yeah. And well, well, with liquidity that the Fed put into the into the market, people had, You know, it's interesting when you look at, say, for instance, take a traditional infrastructure provider like an HP era Dell. Very clearly, their on Prem business deteriorated in the last 100 days. But you know HP Q and, well, HBO, you had some some supply chain problem. But Dell big uptick in this laptop business like Amazon doesn't have that problem. In fact, CEOs have told me I couldn't get a server into my data center was too much of a hassle to get too much time. It didn't have the people. So I just spun up instances on AWS at the same time. You know, Amazon's VD I business who has workspaces business, you know, no doubt, you know, saw an uptick from this. So it's got that broad portfolio, and I think you know, people ask. Okay, what remains permanent? Uh, and I just don't see this This productivity boom that we're now finally getting from work from home pivoting back Teoh, go into the office and it calls into question Stu, when If nobody is in the corporate office, you know the VP ends, you know, the Internet becomes the new private network. >>It's to start ups moving fast. The change has been in the past two months has been, like, two years. Huge challenges. >>Yeah, John, it's an interesting point. So, you know, when cloud first started, it was about developers. It was about smaller companies that the ones that were born in the cloud on The real opportunity we've been seeing in the last few months is, you know, large organizations. You talk about public sector, there's non profits. There's government agencies. They're not the ones that you necessarily think of as moving fast. A David just pointing out Also, many of these changes that we're putting into place are going to be with us for a while. So not only remote work, but you talk about telehealth and telemedicine. These type of things, you know, have been on our doorstep for many years, but this has been a forcing function toe. Have it be there. And while we will likely go back to kind of a hybrid world, I think we have accelerated what's going on. So you know, there is the silver lining in what's going on because, you know, Number one, we're not through this pandemic. And number two, you know, there's nothing saying that we might have another pandemic in the future. So if the technology can enable us to be more flexible, more distributed a xai I've heard online. People talk a lot. It's no longer work from home but really work from anywhere. So that's a promise we've had for a long time. And in every technology and vertical. There's a little bit of a reimagining on cloud, absolutely an enabler for thinking differently. >>John, I wonder if I could comment on that and maybe ask you a question. That's okay. I know your host. You don't mind. So, first of all, I think if you think about a framework for coming back, it's too said, You know, we're still not out of this thing yet, but if you look at three things how digital is an organization. How what's the feasibility of them actually doing physical distancing? And how essential is that business from a digital standpoint you have cloud. How digital are you? The government obviously, is a critical business. And so I think, you know, AWS, public Sector and other firms like that are in pretty good shape. And then there's just a lot of businesses that aren't essential that aren't digital, and those are gonna really, you know, see a deterioration. But you've been you've been interviewing a lot of people, John, in this event you've been watching for years. What's your take on AWS Public sector? >>Well, I'll give an answer that also wants to do away because he and I both talk to some of the guests and interview them. Had some conversations in the community is prep. But my take away looking at Amazon over the past, say, five or six years, um, a massive acceleration we saw coming in that match the commercial market on the enterprise side. So this almost blending of it's not just public sector anymore. It looks a lot like commercial cause, the the needs and the services and the APS have to be more agile. So you saw the same kind of questions in the same kind of crazy. It wasn't just a separate division or a separate industry sector. It has the same patterns as commercial. But I think to me my big takeaways, that Theresa Carlson hit this early on with Amazon, and that is they can do a lot of the heavy lifting things like fed ramp, which can cost a $1,000,000 for a company to go through. You going with Amazon? You onboard them? You're instantly. There's a fast track for you. It's less expensive, significantly less expensive. And next thing you know, you're selling to the government. If you're a start up or commercial business, that's a gold mine. I'm going with Amazon every time. Um, and the >>other >>thing is, is that the government has shifted. So now you have Covad 19 impact. That puts a huge premium on people who are already been setting up for digital transformation and or have been doing it. So those agencies and those stakeholders will be doing very, very well. And you know that Congress has got trillions of dollars day. We've covered this on the Cube. How much of that coverage is actually going for modernization of I T systems? Nothing. And, you know, one of things. Amazon saying. And rightfully so. Shannon Kellogg was pointing out. Congress needs to put some money aside for their own agencies because the citizens us, the taxpayers, we got to get the services. You got veterans, you've got unemployment. You've got these critical services that need to be turned on quicker. There's no money for that. So huge blind spot on the whole recovery bill. And then finally, I think that there's a huge entrepreneurial thinking that's going to be a public private partnership. Cal Poly, Other NASA JPL You're starting to see new applications, and this came out of my interviews on some of the ones I talked to. They're thinking differently, the doing things that have never been done before. And they're doing it in a clever, innovative way, and they're reinventing and delivering new things that are better. So everything's about okay. Modernize the old and make it better, and then think about something new and completely different and make it game changing. So to me, those were dynamics that are going on than seeing emerge, and it's coming out of the interviews. Loud and clear. Oh, my God, I never would have thought about that. You can only do that with Cloud Computing. A super computer in the Cloud Analytics at scale, Ocean Data from sale Drone using satellite over the top observation data. Oh, my God. Brilliant. Never possible before. So these are the new things that put the old guard in the Beltway bandits that check because they can't make up the old excuses. So I think Amazon and Microsoft, more than anyone else, can drive change fast. So whoever gets there first, well, we'll take most of the shares. So it's a huge shift and it's happening very fast more than ever before this year with Covert 19 and again, that's the the analysis. And Amazon is just trying to like, Okay, don't talk about us is we don't want to like we're over overtaking the world because outside and then look opportunistic. But the reality is we have the best solution. So >>what? They complain they don't want to be perceived as ambulance station. But to your point, the new work loads and new applications and the traditional enterprise folks they want to pay the cow path is really what they want to dio. And we're just now seeing a whole new set of applications and workloads emerging. What about the team you guys have been interviewing? A lot of people we've interviewed tons of people at AWS reinvent over the years. We know about Andy Jassy at all. You know, his his lieutenants, about the team in public sector. How do they compare, you know, relative to what we know about AWS and maybe even some of the competition. Where do you Where do you grade them? >>I give Amazon and, um, much stronger grade than Microsoft. Microsoft still has an old DNA. Um, you got something to tell them is bring some fresh brand there. I see the Jedi competition a lot of mud slinging there, and I think Microsoft clearly got in fear solution. So the whole stall tactic has worked, and we pointed out two years ago the number one goal of Jet I was for Amazon not to win. And Microsoft looks like they're gonna catch up, and we'll probably get that contract. And I don't think you're probably gonna win that out, right? I don't think Amazon is gonna win that back. We'll see. But still doesn't matter. Is gonna go multi cloud anyway. Um, Teresa Carlson has always had the right vision. The team is exceptional. Um, they're superb experience and their ecosystem partners Air second and NASA GPL Cal Poly. The list goes on and on, and they're attracting new talent. So you look at the benchmark new talent and unlimited capability again, they're providing the kinds of services. So if we wanted to sell the Cube virtual platform Dave, say the government to do do events, we did get fed ramp. We get all this approval process because Amazon customer, you can just skate right in and move up faster versus the slog of these certifications that everyone knows in every venture capitalists are. Investor knows it takes a lot of time. So to me, the team is awesome. I think that the best in the industry and they've got to balance the policy. I think that's gonna be a real big challenge. And it's complex with Amazon, you know, they own the post. You got the political climate and they're winning, right? They're doing well. And so they have an incentive to to be in there and shape policy. And I think the digital natives we are here. And I think it's a silent revolution going on where the young generation is like, Look at government served me better. And how can I get involved? So I think you're going to see new APS coming. We're gonna see a really, you know, integration of new blood coming into the public sector, young talent and new applications that might take >>you mentioned the political climate, of course. Pre Cove. It'll you heard this? All that we call it the Tech lash, right, The backlash into big tech. You wonder if that is going to now subside somewhat, but still is the point You're making it. Where would we be without without technology generally and big tech stepping up? Of course, now that you know who knows, right, Biden looks like he's, you know, in the catbird seat. But there's a lot of time left talking about Liz more on being the Treasury secretary. You know what she'll do? The big tech, but But nonetheless I think I think really it is time to look at big tech and look at the Tech for good, and you give them some points for that. Still, what do you think? >>Yeah, first of all, Dave, you know, in general, it felt like that tech lash has gone down a little bit when I look online. Facebook, of course, is still front and center about what they're doing and how they're reacting to the current state of what's happening around the country. Amazon, on the other hand, you know, a done mentioned, you know, they're absolutely winning in this, but there hasn't been, you know, too much push back if you talk culturally. There's a big difference between Amazon and AWS. There are some concerns around what Amazon is doing in their distribution facilities and the like. And, you know, there's been lots of spotlights set on that, um, but overall, there are questions. Should AWS and Amazon that they split. There's an interesting debate on that, Dave, you and I have had many conversations about that over the past couple of years, and it feels like it is coming more to a head on. And if it happens from a regulation standpoint, or would Amazon do it for business reason because, you know, one of Microsoft and Google's biggest attacks are, well, you don't want to put your infrastructure on AWS because Amazon, the parent company, is going to go after your business. I do want to pull in just one thread that John you and Dave were both talking about while today you know, Amazon's doing a good job of not trying todo ambulance case. What is different today than it was 10 or 20 years ago. It used to be that I t would do something and they didn't want to talk to their peers because that was their differentiation. But Amazon has done a good job of explaining that you don't want to have that undifferentiated heavy lifting. So now when an agency or a company find something that they really like from Amazon talking all their peers about it because they're like, Oh, you're using this Have you tried plugging in this other service or use this other piece of the ecosystem? So there is that flywheel effect from the cloud from customers. And of course, we've talked a lot about the flywheel of data, and one of the big takeaways from this show has been the ability for cloud to help unlock and get beyond those information silos for things like over 19 and beyond. >>Hey, John, if the government makes a ws spin out or Amazon spin out AWS, does that mean Microsoft and Google have to spin out their cloud businesses to? And, uh, you think that you think the Chinese government make Alibaba spin out its cloud business? >>Well, you know the thing about the Chinese and Facebook, I compare them together because this is where the tech lash problem comes in. The Chinese stolen local property, United States. That's well documented use as competitive advantage. Facebook stole all the notional property out of the humans in the world and broke democracy, Right? So the difference between those bad tech actors, um, is an Amazon and others is 11 enabling technology and one isn't Facebook really doesn't really enable anything. If you think about it, enables hate. It enables some friends to talk some emotional reactions, but the real societal benefit of historically if you look at society, things that we're enabling do well in free free societies. Closed systems don't work. So you got the country of China who's orchestrating all their actors to be state driven, have a competitive advantage that's subsidised. United States will never do that. I think it's a shame to break up any of the tech companies. So I'm against the tech lash breakup. I think we should get behind our American companies and do it in an open, transparent way. Think Amazon's clearly doing that? I think that's why Amazon's quiet is because they're not taking advantage of the system that do things faster and cheaper gets that's there. Ethos thinks benefits the consumer with If you think about it that way, and some will debate that, but in general Amazon's and enabling technology with cloud. So the benefits of the cloud for them to enable our far greater than the people taking advantage of it. So if I'm on agency trying to deliver unemployment checks, I'm benefiting the citizens at scale. Amazon takes a small portion of that fee, so when you have enabling technologies, that's how to me, The right capitalism model works Silicon Valley In the tech companies, they don't think this way. They think for profit, go big or go home and this has been an institutional thing with tech companies. They would have a policy team, and that's all they did. They didn't really do anything t impact society because it wasn't that big. Now, with networked economies, you're looking at something completely different to connected system. You can't handle dissidents differently is it's complex? The point is, the diverse team Facebook and Amazon is one's an enabling technology. AWS Facebook is just a walled garden portal. So you know, I mean, some tech is good, some text bad, and a lot of people just don't know the difference what we do. I would say that Amazon is not evil Amazon Web services particular because they enable people to do things. And I think the benefits far outweigh the criticisms. So >>anybody use AWS. Anybody can go in there and swipe the credit card and spin up compute storage AI database so they could sell the problems. >>The problems, whether it's covert problems on solving the unemployment checks going out, are serving veterans or getting people getting delivering services. Some entrepreneurs develop an app for that, right? So you know there's benefits, right? So this you know, there's not not Amazon saying Do it this way. They're saying, Here's this resource, do something creative and build something solve a problem. And that was the key message of the keynote. >>People get concerned about absolute power, you know, it's understandable. But if you know you start abusing absolute power, really, I've always believed the government should come in, >>but >>you know, the evidence of that is is pretty few and far between, so we'll see how this thing plays out. I mean, it's a very interesting dynamic. I point about why should. I don't understand why AWS, you know, gets all the microscopic discussion. But I've never heard anybody say that Microsoft should spend on Azure. I've never heard that. >>Well, the big secret is Azure is actually one of Amazon's biggest customers. That's another breaking analysis look into that we'll keep on making noted that Dave's do Thanks for coming to do great interviews. Love your conversations. Final words to I'll give you What's the big thing you took away from your conversations with your guests for this cube? Virtual coverage of public sector virtual summit >>so biggest take away from the users is being able to react to, you know, just ridiculously fast. You know it. Talk about something where you know I get a quote on Thursday on Friday and make a decision, and on Monday, on up and running this unparalleled that I wouldn't be able to do before. And if you talk about the response things like over nine, I mean enabling technology to be able to cut across organizations across countries and across domains. John, as you pointed out, that public private dynamic helping to make sure that you can react and get things done >>Awesome. We'll leave it there. Stew. Dave. Thanks for spending time to analyze the keynote. Also summarize the event. This is a does public sector virtual summit online Couldn't be face to face. Of course. We bring the Cube virtual coverage as well as content and our platform for people to consume. Go the cube dot net check it out and keep engaging. Hit us up on Twitter if any questions hit us up. Thanks for watching. >>Yeah, yeah, yeah, yeah, yeah, yeah

from the cube studios in Palo Alto in Boston connecting with thought leaders all around the world this is a cube conversation everyone welcome to this cube conversation here in the cubes Palo Alto Studios we're here with the quarantine crew I'm John for your host we've got a great guest John Madison CMO an EVP of products of Fortinet and today more than ever in this changing landscape accelerating faster and faster certainly as this covin 19 crisis has forced business to realize a lot of the at scale problems are at hand and a lot of things are exposed in terms of problems and opportunities you have to take care of one of them security John thanks for coming on cube and looking forward to chatting about your recent event you had this week and also the updates at Florida thanks for joining me yeah it's great to be here John so more than ever the innovation strategies are not just talking points anymore in board meetings or companies there's they actually have to come out of this pandemic and operate through it with real innovation with actionable outcomes they've got to get their house in order you're seeing projects really focusing in on the at scale problems which is essentially keep the network's run and keep the sick the security fabric in place this is critical path stuff but the innovation coming out of it has to be a growth play for companies and this has been a big thing so you guys are in the middle of it we've chatted about all the four to guard stuff and all this you're seeing all the traffic you're seeing all the all the impact this work at home has forced companies to not only deal to new realities but it's exposed some things they need to double down on and things they need to either get rid of or fix fast what's your take on all this yeah you know I think it took a lot of people by surprise and the first thing I would like to do is you know spank our employees our customers and partners for the work they've done in the last six to seven weeks now what was happening was a lot of customers had built their work from home programs around a certain percentage 5% 10% 15% and that's what they scaled it for then all of a sudden you know everybody had to work from home and so you went from maybe a thousand people to 10,000 or 5,000 to 50,000 they had to scale very quickly because this had to be implemented in hours and days not weeks and months luckily our systems are able to gaile very quickly we can scale using a security processing units which offload the CPU and allow a lot of users simultaneously to access through VPN SSL VPN IPSec VPN and then we have an implementation at home ranging from a very simple Microsoft Wyant all the way to our clients all the way to even off Buda gate firewalls at home so we really did work very hard to make sure that our customers could maintain their business proposition during these times you know I want to get those work at home and I think it's a little big Sdn story and you guys have been on for a long time I mean we've talked with your you and your folks many times around st Wynn and what it means to to have that in place but this work at home those numbers are off the charts strange and this is disruption this was an unforeseen disruption it's not like a hurricane or flood this is real and we've also talked with you guys and your team around the endpoint you know the edge of the network that's the explosion of the billions of edges this is just an industry kind of inside baseball conversation and then also the immersion of the lifestyle we now live in so you have a world where it was inside baseball for this industry now every company and everyone's feeling it this is a huge issue I'm at home I got to protect myself I got data I gotta have a VPN I mean this is a reality that just wasn't seen I mean what do you guys are what are you guys doing in this area well I think it changes that this long-term architect and so you know the past we talked about there being millions of edges and people go how many billions of edges and what's happened is if you're working from home that's an edge and so the long term architecture means that companies need to take care of where their network edges are now the SEM at home they had them at the branch office they have them at the end of prize and the data center in the cloud then we need to decide know where to apply the security is it at the endpoint is it at the edges is the data center or bout an S T one is absolutely essential because every edge you'll have whether that were home now whether it be in your data center or eCampus on the cloud needs that st-1 technology and make sure you can guide the applications in a secure manner what's interesting is I actually deployed st-1 in my home here I've got two ISP connections one week I'm casting off with AT&T now that may be overkill right now for most people about putting st-1 in their homes but I think long-term homes are gonna be part of the enterprise network it's just another eight take a minute to explain the SD win I would call it the this is a mill especially this is not your grandfather's st win I mean it's changed st when is the internet I mean basically at home what does that mean if users don't know care what the products are at the end of the day they're working at home so kind of SD win has taken on a new broader scope if you will it's not just the classic SD win or is it can you take us through I mean and this is a category that's becoming much broader what's your what's your nails is there yeah again I'm not saying that you know consumers are gonna be putting SD wine in the homes right now but if I'm an executive and I rely on my communication out there are lots of meetings during the day work from home I want it to be as reliable as possible so if my one is pee goes down and I can't get on the internet that's an issue if I have to ISPs I have much higher availability but more importantly us you and I can guide the applications where I want when they want I can make sure you know my normal home traffic goes off certain direction the certain on a VLAN and segmentation policy whereas my war can be completely set out so again I you know I think SDRAM technology is important for the home long term is important for the branch for the enterprise and the data center and Earls St ones built into all up all our forty gates have sp1 you just switch it on we think it's a four essential technology going forward to drive that cloud on-ramp real quick follow-up on that for the folks in the enterprise I see the enterprise will make it easier for their customers their users who are at home so it feels consumer II invisible if you will I think that's the short-term what's what are what are you seeing your customers and prospective customers thinking when they come back or as they operate now in this new reality when they say you know what we really miss forecasted this now they have to get back to business what are they gonna do do they do more sta on I mean what's the architecture how does that get done what's the conversation like you know as this evolved for the next it's gonna slowly open up it still it's going to be a new reality for at least 12 months what's the conversation with the customer right now when it comes to going in and taking care of this so it doesn't happen again yeah what I'm doing actually actually what I'm doing a lot of virtual ABC's obviously we usually have 200 our customers that come to our corporate quarters or executive briefings and I'm doing actually more virtually and a lot of the opening conversations is they don't think they're gonna go completely Hunter's under percent back to where they were there's always going to be now a fraction of work-from-home people they may move around some of their physical location so as I said the ST when is that piece on the edge whether it be your home ranch campus or data centers gonna be there to guide the applications guide the users and devices to the right applications of wherever they may be as it could be in the cloud of communion data center it could be anywhere and then the key conversation thereafter for customers long-term architecture wise is where do I apply my security stack and the security spat consists of basic things like antivirus all right yes more detection capabilities even even response to Isis given that stack how much do I put in the edge how much do I put in my endpoint how much do I put my branch how much I put in my campus data center and cloud and then how do I maintain a policy a single policy across all of those and then now and again maybe I have to move that stack cross so that's going to be the key long term architecture question for enterprises as they move to a slightly different composition of workforce in different locations is hey I've got to make sure every edge that I have I identify and I secure when SP ran and then how do I apply the security stack cross all the diff tell great insight thanks for sharing that I want to get your take on now speaking of working at home you're also the CMO as well as the EVP of products which is a unique job because you can talk about any think when the cube we love it you had an event accelerate 2020 the folks watching go to the hashtag on Twitter hashtag accelerate 20 that's the hash tag you'll see a lot of the the pictures of the slides and some commentary I was laying down some tweets all the analysts were as well what are some of the highlights for you is a great presentation by the CEO you gave a talk and there's a lot of breakouts you had to do a digital event because you couldn't hold the physical event so you kind of had a shelter-in-place kind of and how did it go and what are some of the highlights yeah on the one side I was a bit sad you know we had or what we call accelerates arrange for this year in Barcelona and New York Mexico and San Jose we had to cancel war for them and I'm very quickly spin up a digital event a virtual event and you know we end up there's some initial targets around you know you know each of our physical events we get between two and three thousand and so we're thinking you know if we got to ten thousand this would be great we actually ended up with thirty thirty-two thousand or something like that registered and actually the percentage that showed off was even higher so we had over 20,000 people actually come online and go through our keynotes we built it so you go through the keynotes then you can go off to the painting what we call the breakouts for more detail we did verticals oh it did more technology sessions and so it's great and you know we tried our best to answer the questions online because these things are on demand we had three we had one for the u.s. one premiere and won't write back and so there was times but to get that sort of exposure to me is amazing twenty thousand people on there listening and it connects into another subject which is education and fun yet for some time as invested I would say you know my CEO says but I'll invest a bit more in education versus the marketing advertising budget now go okay okay that's that hey we'll work on that but education for us we announced a few weeks ago that education is now training is free for customers for everybody and we'd also been you know leading the way by providing free training for our partners now it's completely free for everybody we have something called the network security expert which goes from one to eight one and two of that are actually open to the public right now and if I go to the end of last year we had about two to three thousand people maybe a week come on and do the training obviously majority doing the NSC one courses you get further through to eight it's more technical last week we had over eighty thousand people we just think about those numbers incredible because people you know having more time let's do the training and finding is as they're doing this training going up the stack more quickly and they're able to implement their tools more quickly so training for us is just exploded off the map and I and there's a new reality of all the unemployment and also people are at home and there's a lot of job about the skill gap before in another cube conversation it's it's more apparent than ever and why not make it free give people some hope give them some tools to be successful there's demand yes and it's not you know it's not just them you know IT professionals are Ennis e1 is a foundational course and you'll see kids and students and universities doing it and so Ben Mars granddad's dad's doing it so we we're getting all sorts of comments and social media about the training you know our foundation great stuff has a great we'll put a plug on that when should we get that amplified for its really good stuff I got to ask you about the event one of the things I really like about the presentation was from your CEO and you gave one as well was the clarity around the vision of security and a couple of things that were notable to me was the confluence of the collision between networking and security and at the intersection of those two forces you have an accelerated integrated policy dynamic to me this is the heart of DevOps of what used to be in cloud being kind of applied to security you have data you got all kinds of new things emerging new patterns new signals that's security so you got to be you got to be fast you got to identify things so you guys are in this business that's one force and the other one was the billions of edges and this idea that there's no perimeter so it's everything's immersive so illustrate some points of validation on that from your standpoint is that how you guys are seeing it unfold in the future is that happening now can you give us a feeling for whether where we are and that those those kind of paradigms yeah good point so I think it's been happening it's happening now has been happening the future you know if you look at networking and our CEO Enzi talked about this and that networking hasn't really cheer outing and switching we go back to 2000 we had 100 mega under megabit now you have formed a gigabit but the basic function we haven't really changed that much securities different we've gone from a firewall and we add VPN then we at next-gen firewall then we had SSL inspection now we've added sd1 and so this collisions kind of an equal in that you know networking's sped ahead and firewalling is stayed behind because it's just got too many applications on that so the basic principle premise of the company of putting net is to build and bring that together so it's best of all accelerate the basic security network security functions so you can consolidate multiple functions on one system and then bring networking and security together a really good example of security where or nexium firewall where you can accelerate and so our security processing units and my analogy simple analogy is GPUs inside games where their GPU offloads CPU to allow rendering to happen very quick it's the same for us RSP use way of a network SPU and we have a Content SPU which all flows the CPU to allow a security and networking do it be accelerated work now coming to your second point about the perimeter I I'm not quite sure whether the perimeters disappear and the reason I say that is customer still goes they have firewalls on the front of the networks they have endpoint protection they have protection in the cloud so it's not that the perimeters disappeared it's just but much larger and so now the perimeters sitting across all your infrastructure your endpoints your in factories you got IOT devices you've got workloads in different powered and that means you need to look very carefully at those and give visibility initially and then apply the control that control maybe it's a ten-point security it may be SD mine at the edge it may be a compliance template in the cloud but you need visibility of all those edges which have been created with the perimeters reading across the image it's interesting you bring up a good point we always have kind of debates over beers on this on this topic you know the old model was mote you know get the castle and the gate but here the perimeter of the edge if you believe there's an edge and I do believe you find it perfectly the edge is a perimeter it's an endpoint right so it's a door into the internet so are the network so is the perimeter just an end adorn there's more doors right so or service yeah just think about it the castle would did multiple doors is the back everyone's the door there's this dozle someday and you have to define those H's and have visibility of them and that's why things like network access control know for you know zero trust network access is really important making sure you kind of look at the edge inside your way and so your data center and then it's like you powd what workloads are spinning off and what's the configuration and what's there what's from a data perspective right your recommendation and I'm a customer looking at my network I got compute I got edge devices and users I realized there's a billions of edges on my network now and the realities hit me I wasn't really being proactive on investing what do I do what's the PlayBook for me as I start to rethink that and what do I put into place how do I get going now I got to rethink it I now recognize I got full validation I got to manage this I got to do something what's your recommendation to me if I'm a customer the key to me is and I've had this conversation now for the last five years and it's getting louder and louder and that is I suppose I spend a lot of money on point solution point but even end point may have five point products on there and so they're getting to the conclusion it's just too hard to manage I can't find all the right people I get so many alerts from so many security systems I can't work out what's going on and the conversation now is how do I deploy a platform we call it the security fabric now I don't deploy that fabric across my network I'm not saying you should go from 30 vendors to one vendor that would be nice of course but I what I'm saying as you go from 30 vendors down to maybe five or six platform the platform's perform multiple functions it could be they're out there you attach a platform a designer platform just birth protector or a particular organization or part of the network and so the platform allows you then to build automation and the automation allows you to see things more quickly and react to things more quickly and do things without manual intervention the platform approach it's absolutely starting to resonate yes you've still got very very large customers who put everything into segments of a C's Exedra book most customers now moving towards a yeah I think you know as you see and again back to that collision with the end of the intersection we have integrated policies if you're gonna do any integration which is the data problem so we talk about all the time to a lot of different tools can create silos and there's a use case for that but also creates problematic situations I mean a platform gives you a much more robust capability to be adaptive to be real time to program and automate yeah it's it's it's an issue if you've got 30 vendors and just be honest it's also an issue in the industry so I mean networking the story kind of worked out how to work together you can use the same different vendor switches and routers and they roughly work together with cybersecurity they've all been deal you know built totally separately not to even work and that's why you've got these multiple layers you've got a product the security problem then this got its own analytics engine and manager then you've got a manager of managers and an analyzer of analyzers and the sim system and then a saw I mean just goes on it makes it so complex for people and that's why I think they look into something a bit more simplified but most importantly the platform must be friendly from a consumption model you must be able to do an appliance where you need to do virtual machine SAS cloud native container whatever it may be because that network has changed in those ages as those edges move you've got them to have a platform that adaptable to the consumption model require you know I had a great cartridge with Phil Quaid you see your seaso over there and we were chatting around you know this idea of I won't say customization but there's no one turnkey monolithic application it seems to these platforms tend to be enabling where the seaso trend is to have teams building ok and and and almost a customized but building software to automate to solve their use case for their outcome so enabling that is a trend we're seeing so I think you guys are on the right track there any comment on your take on this enabling platform is that something that you guys are seeing that CSIS is looking at more in-house development more use case focus because they have the data they got real-time they need to be building on a platform not told what they could do yeah I think you've always had this this network team trying to build things fast and open and the security team trying to post things down and make it more secure you know it becomes even more problematic if you kind of go to the cloud where you've got pockets a developer's kind of thing do things in the DevOps way really as fast as possible and sometimes the controls are not put in place in fact no the big as I said the biggest issue for the cloud is not so much you know malware it it's more about miss configuration that's why you're seeing the big breaches and that's more of a customer thing to do and so I think what the seaso is trying to do is make sure they apply the controls appropriately and again their job has become much harder now we've got all the multitude of endpoints that they didn't have before they've got now there when that's not just the closed MPLS network is old off different types of broadband 5 G's coming towards the end of this year next year as well the data centers may have decreased a bit but they've still got datacenter capacity and they're probably got 5 or 6 hours and 20 different SAS applications that put a deal with and they've got to deal with developers in there so it's a harder job for them and they need to melt or add those tools but come back to that single point of management great stuff John Madison CMO EVP great insight there it's almost a master class right there you laid it all out on what's going on a final question any change is what any other news updates on the four net front I know you guys got some answer I didn't see the breakouts of the session I had something else going on I think I've been walking dog and do some other things but you know being at home and to take care of things what's new what's what's out that people might have missed that's coming out of for today you're telling me you didn't have 60 hour a breakout on dedicated I don't think yeah we've you know we've have a lot going on you know we have a big R&D team here in North America and Canada and with a lot of products coming out this time of the year we bring out our 40 OS network operating system with 6.4 over 300 new features inside there including new orchestration systems for sp1 and then also we actually launched on network processor seven and the board gate already 200 F powered by four network processor sevens it's some system out there and provide over 800 gigs of fire or capacities but in bill V explain acceleration they can do things like elephant flows huge flows of data so there's always there's always new products coming out of 14 it sure those are the two big ones for this quarter you guys certainly are great interviews to talk to great a lot of expertise there final final question you know everyone every company's got their culture Moore's laws cadence of Moore's laws Intel faster cheaper smaller what's the for Annette culture if you had to kind of boil it down what's it you guys are always pushing great products out there all high quality I'll see security you got to be buttoned up and have good ops and controls but you still need to push the envelope and have stadia what's the culture if you had to kind of boil the culture down for Porter net what would it be that's always an interesting question and so the company's been going since 2000 okay the founders are still there NZ's CEO and Michael Z's the CTO and I think that one of the philosophies is that listen to the customer very closely because you can get distracted by shiny objects all over the place I want to go and do this oh yeah let's build this what about this and in the end the customer and and what they want may get lost and so we listen very closely we use you know we have a very high content of technology people who can translate the customer use case into what we should build and so I think that's the culture we have and maintain that so we're very close to our customers we've been building very quickly for them make sure it works it needs tweaking then we'll look at it again a very very customer driven always great to hear from the founders you guys had a great event accelerate 20 that's the hashtag some great highlights on Twitter some commentary there and of course go to Ford a net site to check out the replays Sean man so thanks for taking the time to share your insights here on the cube conversation I really appreciate it thank you okay it's cube concert here in Palo Alto we're bringing you all the interviews during this time we have our quarantine crew the cube is virtual we'll do whatever it takes to get the interviews out there and get the stories out there and the people behind the tech making it happen I'm John Fourier thanks for watching [Music]

>> Announcer: Live from the Bill Graham Auditorium in San Francisco, it's theCUBE, covering Pure Storage Accelerate 2018. Brought to be you by Pure Storage. >> Welcome back to theCUBE, we are live at Pure Storage Accelerate 2018 in San Francisco. I'm Lisa Prince Martin with Dave The Who Vellante, and we're with David Hatfield, or Hat, the president of Purse Storage. Hat, welcome back to theCUBE. >> Thank you Lisa, great to be here. Thanks for being here. How fun is this? >> The orange is awesome. >> David: This is great. >> Super fun. >> Got to represent, we love the orange here. >> Always a good venue. >> Yeah. >> There's not enough orange. I'm not as blind yet. >> Well it's the Bill Graham, I mean it's a great venue. But not generally one for technology conferences. >> Not it's not. You guys are not conventional. >> So far so good. >> But then-- >> Thanks for keeping us out of Las Vegas for a change. >> Over my dead body I thin I've said once or twice before. >> Speaking of-- Love our customers in Vegas. Unconventional, you've said recently this is not your father's storage company. What do you mean by that? >> Well we just always want to do things a little bit less conventional. We want to be modern. We want to do things differently. We want to create an environment where it's community so our customers and our partners, prospective customers can get a feel for what we mean by doing things a little bit more modern. And so the whole orange thing is something that we all opt in for. But it's more about really helping transform customer's organizations think differently, think out of the box, and so we wanted to create a venue that forced people to think differently, and so the last three years, one was on Pier 48, we transformed that. Last year was in a big steelworkers, you know, 100 year old steel manufacturing, ship building yard which is now long since gone. But we thought the juxtaposition of that, big iron rust relative to what we're doing from a modern solid state perspective, was a good metaphor. And here it's about making music, and how can we together as an industry, develop new things and develop new songs and really help transform organizations. >> For those of you who don't know, spinning disk is known as spinning rust, right? Eventually, so very clever sort of marketing. >> The more data you put on it the slower it gets and it gets really old and we wanted to get rid of that. We wanted to have everything be online in the data center, so that was the point. >> So Hat, as you go around and talk to customers, they're going through a digital transformation, you hear all this stuff about machine intelligence, artificial intelligence, whatever you want to call it, what are the questions that you're getting? CEO's, they want to get digital right. IT professionals are wondering what's next for them. What kind of questions and conversations are you having? >> Yeah, I think it's interesting, I was just in one of the largest financial services companies in New York, and we met with the Chief Data Officer. The Chief Data Officer reports into the CEO. And he had right next to him the CIO. And so they have this development of a recognition that moving into a digital world and starting to harness the power of data requires a business context. It requires people that are trying to figure out how to extract value from the data, where does our data live? But that's created the different organization. It drives devops. I mean, if you're going to go through a digital transformation, you're going to try and get access to your data, you have to be a software development house. And that means you're going to use devops. And so what's happened from our point of view over the last 10 years is that those folks have gone to the public cloud because IT wasn't really meeting the needs of what devops needed and what the data scientists were looking for, and so what we wanted to create not only was a platform and a tool set that allowed them to bridge the gap, make things better today dramatically, but have a platform that gets you into the future, but also create a community and an ecosystem where people are aware of what's happening on the devop's side, and connect the dots between IT and the data scientists. And so we see this exploding as companies digitize, and somebody needs to be there to help kind of bridge the gap. >> So what's your point of view and advice to that IT ops person who maybe really good at provisioning LUNS, should they become more dev like? Maybe ops dev? >> Totally, I mean I think there's a huge opportunity to kind of advance your career. And a lot of what Charlie talked about and a lot of what we've been doing for nine years now, coming up on nine years, is trying to make our customers heroes. And if data is a strategic asset, so much so they're actually going to think about putting it on your balance sheet, and you're hiring Chief Data Officers, who knows more about the data than the storage and infrastructure team. They understand the limitations that we had to go through over the past. They've recognized they had to make trade offs between performance and cost. And in a shared accelerated storage platform where you have tons of IO and you can put all of your applications (mumbles) at the same time, you don't have to make those trade offs. But the people that really know that are the storage leads. And so what we want to do is give them a path for their career to become strategic in their organization. Storage should be self driving, infrastructure should be self driving. These are not things that in a boardroom people care about, gigabytes and petabytes and petaflops, and whatever metric. What they care about is how they can change their business and have a competitive advantage. How they can deliver better customer experiences, how they can put more money on the bottom line through better insights, etc. And we want to teach and work with and celebrate data heroes. You know, they're coming from the infrastructure side and connecting the dots. So the value of that data is obviously something that's new in terms of it being front and center. So who determines the value of that data? You would think it's the business line. And so there's got to be a relationship between that IT ops person and the business line. Which maybe here to for was somewhat adversarial. Business guys are calling, the clients are calling again. And the business guys are saying, oh IT, they're slow, they say no. So how are you seeing that relationship changing? >> It has to come together because, you know, it does come down to what are the insights that we can extract from our data? How much more data can we get online to be able to get those insights? And that's a combination of improving the infrastructure and making it easy and removing those trade offs that I talked about. But also being able to ask the right questions. And so a lot has to happen. You know, we have one of the leaders in devops speaking tomorrow to go through, here's what's happening on the software development and devops side. Here's what the data scientists are trying to get at. So our IT professionals understand the language, understand the problem set. But they have to come together. We have Dr. Kate Harding as well from MIT, who's brilliant and thinking about AI. Well, there's only .5% of all the data has actually been analyzed. You know, it's all in these piggy banks as Burt talked about onstage. And so we want to get rid of the piggy banks and actually create it and make it more accessible, and get more than .5% of the data to be usable. You know, bring as much of that online as possible, because it's going to provide richer insights. But up until this point storage has been a bottleneck to making that happen. It was either too costly or too complex, or it wasn't performing enough. And with what we've been able to bring through solid state natively into sort of this platform is an ability to have all of that without the trade offs. >> That number of half a percent, or less than half a percent of all data in the world is actually able to be analyzed, is really really small. I mean we talk about, often you'll here people say data's the lifeblood of an organization. Well, it's really a business catalyst. >> David: Oil. >> Right, but catalysts need to be applied to multiple reactions simultaneously. And that's what a company needs to be able to do to maximize the value. Because if you can't do that there's no value in that. >> Right. >> How are you guys helping to kind of maybe abstract storage? We hear a lot, we heard the word simplicity a lot today from Mercedes Formula One, for example. How are you partnering with customers to help them identify, where do we start narrowing down to find those needles in the haystack that are going to open up new business opportunities, new services for our business? >> Well I think, first of all, we recognize at Pure that we want to be the innovators. We want to be the folks that are, again, making things dramatically better today, but really future-proofing people for what applications and insights they want to get in the future. Charlie talked about the three-legged stool, right? There's innovations that's been happening in compute, there's innovations that have been happening over the years in networking, but storage hasn't really kept up. It literally was sort of the bottleneck that was holding people back from being able to feed the GPUs in the compute that's out there to be able to extract the insights. So we wanted to partner with the ecosystem, but we recognize an opportunity to remove the primary bottleneck, right? And if we can remove the bottleneck and we can partner with firms like NVIDIA and firms like Cisco, where you integrate the solution and make it self driving so customers don't have to worry about it. They don't have to make the trade offs in performance and cost on the backend, but it just is easy to stamp out, and so it was really great to hear Service Now and Keith walk through is story where he was able to get a 3x level improvement and something that was simple to scale as their business grew without having an impact on the customer. So we need to be part of an ecosystem. We need to partner well. We need to recognize that we're a key component of it because we think data's at the core, but we're only a component of it. The one analogy somebody shared with me when I first started at Pure was you can date your compute and networking partner but you actually get married to your storage partner. And we think that's true because data's at the core of every organization, but it's making it available and accessible and affordable so you can leverage the compute and networking stacks to make it happen. >> You've used the word platform, and I want to unpack that a little bit. Platform versus product, right? We hear platform a lot today. I think it's pretty clear that platforms beat products and that allows you to grow and penetrate the market further. It also has an implication in terms of the ecosystem and how you partner. So I wonder if you could talk about platform, what it means to you, the API economy, however you want to take that. >> Yeah, so, I mean a platform, first of all I think if you're starting a disruptive technology company, being hyper-focused on delivering something that's better and faster in every dimension, it had to be 10x in every dimension. So when we started, we said let's start with tier one block, mission critical data workloads with a product, you know our Flash Array product. It was the fastest growing product in storage I think of all time, and it still continues to be a great contributor, and it should be a multi-billion dollar business by itself. But what customers are looking for is that same consumer like or cloud like experience, all of the benefits of that simplicity and performance across their entire data set. And so as we think about providing value to customers, we want to make sure we capture as much of that 99.5% of the data and make it online and make it affordable, regardless of whether it's block, file, or object, or regardless if it's tier one, tier two, and tier three. We talk about this notion of a shared accelerated storage platform because we want to have all the applications hit it without any compromise. And in an architecture that we've provided today you can do that. So as we think about partnering, we want to go, in our strategy, we want to go get as much of the data as we possibly can and make it usable and affordable to bring online and then partner with an API first open approach. There's a ton of orchestration tools that are out there. There's great automation. We have a deep integration with ACI at Cisco. Whatever management and orchestration tools that our customer wants to use, we want to make those available. And so, as you look at our Flash Array, Flash Deck, AIRI, and Flash Blade technologies, all of them have an API open first approach. And so a lot of what we're talking about with our cloud integrations is how do we actually leverage orchestration, and how do we now allow and make it easy for customers to move data in and out of whatever clouds they may want to run from. You know, one of the key premises to the business was with this exploding data growth and whether it's 30, 40, 50 zettabytes of data over the next you know, five years, there's only two and a half or three zettabytes of internet connectivity in those same period of time. Which means that companies, and there's not enough data platform or data resources to actually handle all of it, so the temporal nature of the data, where it's created, what a data center looks like, is going to be highly distributed, and it's going to be multi cloud. And so we wanted to provide an architecture and a platform that removed the trade offs and the bottlenecks while also being open and allowing customers to take advantage of Red Shift and Red Hat and all the container technologies and platform as a service technologies that exist that are completely changing the way we can access the data. And so we're part of an ecosystem and it needs to be API and open first. >> So you had Service Now on stage today, and obviously a platform company. I mean any time they do M and A they bring that company into their platform, their applications that they build are all part of that platform. So should we think about Pure? If we think about Pure as a platform company, does that mean, I mean one of your major competitors is consolidating its portfolio. Should we think of you going forward as a platform company? In other words, you're not going to have a stovepipe set of products, or is that asking too much as you get to your next level of milestone. >> Well we think we're largely there in many respects. You know, if you look at any of the competitive technologies that are out there, you know, they have a different operating system and a different customer experience for their block products, their file products, and their object products, etc. So we wanted to have a shared system that had these similar attributes from a storage perspective and then provide a very consistent customer experience with our cloud-based Pure One platform. And so the combination of our systems, you hear Bill Cerreta talk about, you have to do different things for different protocols to be able to get the efficiencies in the data servers as people want. But ultimately you need to abstract that into a customer experience that's seamless. And so our Pure One cloud-based software allows for a consistent experience. The fact that you'll have a, one application that's leveraging block and one application that's leveraging unstructured tool sets, you want to be able to have that be in a shared accelerated storage platform. That's why Gartner's talking about that, right? Now you can do it with a solid state world. So it's super key to say, hey look, we want consistent customer experience, regardless of what data tier it used to be on or what protocol it is and we do that through our Pure One cloud-based platform. >> You guys have been pretty bullish for a long time now where competition is concerned. When we talk about AWS, you know Andy Jassy always talks about, they look forward, they're not looking at Oracle and things like that. What's that like at Pure? Are you guys really kind of, you've been also very bullish recently about NVME. Are you looking forward together with your partners and listening to the voice of the customer versus looking at what's blue over the corner? >> Yes, so first of all we have a lot of respect for companies that get big. One of my mentors told me one time that they got big because they did something well. And so we have a lot of respect for the ecosystem and companies that build a scale. And we actually want to be one of those and are already doing that. But I think it's also important to listen and be part of the community. And so we've always wanted to the pioneers. We always wanted to be the innovators. We always wanted to challenge conventions. And one of the reasons why we founded the company, why Cos and Hayes founded the company originally was because they saw that there was a bottleneck and it was a media level bottleneck. In order to remove that you need to provide a file system that was purpose built for the new media, whatever it was going to be. We chose solid state because it was a $40 billion industry thanks to our consumer products and devices. So it was a cost curve where I and D was going to happen by Samsung and Toshiba and Micron and all those guys that we could ride that curve down, allowing us to be able to get more and more of the data that's out there. And so we founded the company with the premise that you need to remove that bottleneck and you can drive innovation that was 10x better in every dimension. But we also recognize in doing so that putting an evergreen ownership model in place, you can fundamentally change the business model that customers were really frustrated by over the last 25 years. It was fair because disk has lots of moving parts, it gets slower with the more data you put on, etc., and so you pass those maintenance expenses and software onto customers. But in a solid state world you didn't need that. So what we wanted to do was actually, in addition to provide innovation that was 10x better, we wanted to provide a business model that was evergreen and cloud like in every dimension. Well, those two forces were very disruptive to the competitors. And so it's very, very hard to take a file system that's 25 years old and retrofit it to be able to really get the full value of what the stack can provide. So we focus on innovation. We focus on what the market's are doing, and we focus on our customer requirements and where we anticipate the use cases to be. And then we like to compete, too. We're a company of folks that love to win, but ultimately the real focus here is on enabling our customers to be successful, innovating forward. And so less about looking sidewise, who's blue and who's green, etc. >> But you said it before, when you were a startup, you had to be 10x better because those incumbents, even though it was an older operating system, people's processes were wired to that, so you had to give them an incentive to do that. But you have been first in a number of things. Flash itself, the sort of All-Flash, at a spinning disk price. Evergreen, you guys set the mark on that. NVME you're doing it again with no premium. I mean, everybody's going to follow. You can look back and say, look we were first, we led, we're the innovator. You're doing some things in cloud which are similar. Obviously you're doing this on purpose. But it's not just getting close to your customers. There's got to be a technology and architectural enabler for you guys. Is that? >> Well yeah, it's software, and at the end of the day if you write a file system that's purpose built for a new media, you think about the inefficiencies of that media and the benefits of that media, and so we knew it was going to be memory, we knew it was going to be silicon. It behaves differently. Reads are effectively free. Rights are expensive, right? And so that means you need to write something that's different, and so you know, it's NVME that we've been plumbing and working on for three years that provides 44,000 parallel access points. Massive parallelism, which enables these next generation of applications. So yeah we have been talking about that and inventing ways to be able to take full advantage of that. There's 3D XPoint and SCM and all kinds of really interesting technologies that are coming down the line that we want to be able to take advantage of and future proof for our customers, but in order to do that you have to have a software platform that allows for it. And that's where our competitive advantage really resides, is in the software. >> Well there are lots more software companies in Silicon Valley and outside Silicon Valley. And you guys, like I say, have achieved that escape velocity. And so that's pretty impressive, congratulations. >> Well thank you, we're just getting started, and we really appreciate all the work you guys do. So thanks for being here. >> Yeah, and we just a couple days ago with the Q1FY19, 40%, you have a year growth, you added 300 more customers. Now what, 4800 customers globally. So momentum. >> Thank you, thank you. Well we only do it if we're helping our customers one day at a time. You know, I'll tell you that this whole customer first philosophy, a lot of customers, a lot of companies talk about it, but it truly has to be integrated into the DNA of the business from the founders, and you know, Cos's whole pitch at the very beginning of this was we're going to change the media which is going to be able to transform the business model. But ultimately we want to make this as intuitive as an iPhone. You know, infrastructure should just work, and so we have this focus on delivering simplicity and delivering ownership that's future proofed from the very beginning. And you know that sort of permeates, and so you think about our growth, our growth has happened because our customers are buying more stuff from us, right? If you look at our underneath the covers on our growth, 70 plus percent of our growth every single quarter comes from customers buying more stuff, and so, as we think about how we partner and we think about how we innovate, you know, we're going to continue to build and innovate in new areas. We're going to keep partnering. You know, the data protection staff, we've got great partners like Veeam and Cohesity and Rubrik that are out there. And we're going to acquire. We do have a billion dollars of cash in the bank to be able to go do that. So we're going to listen to our customers on where they want us to do that, and that's going to guide us to the future. >> And expansion overseas. I mean, North America's 70% of your business? Is that right? >> Rough and tough. Yeah, we had 28%-- >> So it's some upside. >> Yeah, yeah, no any mature B2B systems company should line up to be 55, 45, 55 North America, 45, in line with GDP and in line with IT spend, so we made investments from the beginning knowing we wanted to be an independent company, knowing we wanted to support global 200 companies you have to have operations across multiple countries. And so globalization is always going to be key for us. We're going to continue our march on doing that. >> Delivering evergreen from an orange center. Thanks so much for joining Dave and I on the show this morning. >> Thanks Lisa, thanks Dave, nice to see you guys. >> We are theCUBE Live from Pure Accelerate 2018 from San Francisco. I'm Lisa Martin for Dave Vellante, stick around, we'll be right back with our next guests.

hello everyone I'm Jean Faria we are reporting on the ground near Puerto Rico for blockchain unbound exclusive conversations at coinage end of covering all the action restart week of ten of events cryptocurrency blockchain all the people are here with the local ecosystem the cube is here it's great to have you on thanks for joining blockchain innovation is today global this is a revolution way bigger than the Internet itself programmable money programmable contracts that wipes out finance it wipes out legal it wipes out governance in many ways there's no central authority you have access to open source software it's fully connected so now is the time to make it translate we've all heard about the steam digital transformation its businesses that if they don't evolve and adopt blockchain AI all these other things they have a threat of being put out of business it is extremely competitive a new set of stakeholders investors global players governments are it's happening now you have a chance to be a part of an economy without a permission of a centralized organization have to pay 200 people in 40 countries and it's an unholy mess with withholding taxes and concerns around money transfer costs a hassle it's a nightmare like all currency control so you're only allowed to move a certain amount of capital out the country legally so what happens in all your backups our currency and you can effectively invest in assets around the world this is making it much easier to contribute to help people to get healthy and you don't have to go to school there's a very big influx of young and talented minds at that right and this is really changing the revolution landscape you've got the radical Burning Man hippie guy all the way to a three-piece suit yeah and that diversity is very very rich a lot of people are scared I like whoa hold on slow down we're not gonna prove it the other half saying no this is the future so you have two competing forces colliding for some reason crypto really pokes at people's biases you know why does it have any value and I go well why does the United States dollar have any value I mean you've got Full Faith and Credit of the government that's in debt by 20 trillion dollars you know is that a good idea most people that come here sorry with the what the how and people are scared but the young people are like yo this is happening this is not a moment this is a movement is definitely oh say 1996-97 of the internet bubble it's just starting people know there's something really magical they don't quite know what you know America really grew because you're abused to have all the controls and so the capital by sea left Europe and away in America and now it's happening 300 years later as America has all the controls and the capital starting to go away so a new Liberation's happening incredible resources are now being poured in problems that were ignored for many many and what is beautiful is that block Candy's doing it open-source is accelerating the tech these ideas are being freely shared whereas before there's bottlenecks in the collaboration aspect if we're able to write a contract in a thousand people be able to verify that contract and we're able to transfer money from one person to another without the two parties being involved we've got a perfect scenario security and speed and fairness all at the same time you can create these chains of trust and that can happen anywhere in the world you're on a level playing field if you have 4G connectivity now you can compete globally and be a part of the global economy so if you're someone who's in the emerging developing world and you want to begin to build wealth and you'd like to own a piece of first world real estate and today the minimum is about a thousand dollars but by implementing the Plott chain further they won't eventually get down to one dollar you can buy a piece of real estate and enjoy the returns on that I want to solve the wealth gap and I truly believe we can do it when we can allow anyone anywhere to invest in good quality assets a conduit with the current system there's too many friction costs the killer app right is money it's paying people that is the killer app of the block type right now let's say that money is software and it is software so if you buy something with a credit card what do you think's happening it's all software and what has happened is open-source software has always eventually won with respect to close source software so proprietary money is probably back on its heels because open-source money's coming in something like that will give liquidity to a lot of small business owners America is a country of small business owners across the globe it supports small business owners it's an interesting model yeah you don't have to give up any equity you don't have to give up any poor seats yeah right it's much leaner my super if you're an investor you gotta get a pound of flesh somewhere is it's just getting it on the discounted tokens is there a little liquidity going on when you think about you know private sale presale is 99% a token deal right although equities coming in because a lot of more venture capital is coming in and they're demanding a piece of the action from a company and equity perspective its equity might be future revenue sometimes as dividends or the opportunity get dividends so it's a combination of you have a preference you care you know at the other day equity is I was always preferable there is a provision in the 1934 Securities Act called section 12 G it allows us Spacely to go public by telling the SEC we're doing it without having to delay it to wait for their permission after 60 days it's a derivative so we'll continue to clear comments but but the thing is with tokens who knows how long that'll take I mean is the SEC gonna Shepherd something through with crypto 1 or do they gonna make it take 5 years I don't know [Music] all over the island this is the new Oliver field the world is moving too fast today for a big country to keep up it's all gonna happen now in this next century at the city level and so we work a lot with four smaller countries or small countries because I know estonia armenia baja rains got you know dubai envy so i mean every country wants to be the crypto country multiple small countries are going to come into the space which they know now they can get the capital flowing into that company and they're gonna allow their rules to be lacs they're gonna let capital flow through and then us will have to change or maybe UK will have to change orders against us will have to change in the first world a lot of what we're talking about is a nice-to-have it's it's sort of a bit of a game and if i can participate but where I come from an emerging war that's a necessity they are no other solutions so if you live in South Africa or China or India and you want to get your money into a first world country like England Australia America it's very very difficult and virtually no one can do it but it's a major problem because you want wealth preservation you want but Plan B you want your children to be able to go to a first world university etc etc etc Puerto Rico being a free associated States of the United States of America is like the best place to actually test this possibly some push for that for infrastructure for you know internet for all sorts of different things in terms of building the best infrastructure the new newest best-in-class for your business it's four percent corporate taxes and individual it's zero percent now that's what you got to move here you gotta move here okay but you don't have to give you deliver your US citizenship no taxes are great at the same time they fall in love with the islands so it's amazing because to me Puerto Rico is a combination of LA's whether San Francisco's open-mindedness and Barcelona's you know deep European history it's just a really beautiful place and it's US territory so it's a short hop and a jump to the States if you need to most people in America mainland sort of think they're going to a foreign country because it's treated that way by our government how do I come to Puerto Rico do it right not offend the culture in abil them together what's your experience with the play ball stay good friends lost their relocation services for their business and themselves so they write a big check to you guys for the service but it's you guide them through the entire process and there's real energy here because there's a social movement underneath the entire cryptocurrency movement and that's to basically help your fellow man or women all these activity is really going to give a a shot in the arm to the Puerto Rican economy and we're bringing our funds and we're bringing our advisory the radar Thank You exponent there the hurricane was a horrible atrocity that happened and now we have this blank canvas to create a vision for Puerto Rico so what we're doing is we're connecting every single University on the island to work on open source projects to like make solutions for the private sector they know that if they can buy power on a cellphone like they're already doing for other goods and services now we've got a game-changer this is restart week and one of the other things that we've done is help all of the conference's come together collaborate rather than compete so go into the same week and put all of these satellite groups around it and then we blanket it a week around it so that we had one place for people to go and look for all of the events and then also for some for them to understand a movement about the education piece it's very difficult for people that kind of get caught up to speed because there's some technical things that need to understand to really apply this technology into the business world the other day we had an event where we talked 50 people how to create a smart contract from scratch those are 50 people who are not the same anymore ecosystems developing yet entrepreneurs you got projects you got funding coming in but as it's gonna be a fight for the ecosystem because you can't have zillion ecosystems there are definitely some you know the galaxies and you know regulatory aspects that you know put some concerns and a lot of you know people's mind since its inception you've seen people and media and mainstream media in particular target Bitcoin and they're just adopting the government narrative saying oh everyone in this industry is corrupt Oh everyone in this industry is an ICS camera Oh everyone in this industry is a a drug runner and they have all selling drugs on the dark web and and it's like you know what like you can do some research and don't get better than that traditional media they want to take down everybody that they don't consider you know like a birds of the same feather there actually are a lot of scammers and a lot of like dark forces inside of the cryptocurrency movement so that's why I think we welcome kind of more regulatory influence because you know none of us want to see bad actors in the space we've seen folks go out raise you know really big about to capital with no product roadmap no business talking roadmap no real way to get from zero to X what are they trying to shoehorn a regular business onto the blockchain and just assume that by adding crypto at the end of you know toilet paper they're gonna get something I had another founder tell me that you know Mike tokens are worth 100 million humming yep you don't have a user you just have a product you're tokens I've hiked if you ask me it's it's what little I can tell my house is 100 million dollars it's only worth as much as the top buyer how much we really need hardcore reputation systems in our industry and in the for the world I think 2018 is going to be the year of clarity on regulation and I think that's where Puerto Rico comes in and plays a major role just to see the thousands of people who have come here to support these several conferences has been amazing my most surprising thing though is the amount of people that have told me that they bought a one-way ticket and have no intention of going home so to make Puerto Rico your home I think is a really amazing first step when I go to the supermarket and where I go it's full of American and people from outside and when you ask them where you're from and they will tell you from Puerto Rico this is gonna become the epicenter of this multi-billion dollar market we need to have people prepared for this you have to create the transparency the beauty of the transparency is there's actually privacy baked in and that's what I love about blockchain is it has all of the good things all communities need to evolve in my opinion between technology communities open networks of governance where we have peer-to-peer distribution of finance and of resources in a way that allows people to aggregate around the marketplaces that are actually benefitting the way that they believe the world should work we're going to be tools that far surpassed what's currently available in terms of the messages the websites all these things for 20 years the Internet has been free it's a really beautiful thing for consumption and open-source is the absolute right methodology for software when it comes to your own content a reward it makes sense everybody is going to get to play together across every device the developers are going to get rewarded for creating content people are going to be rewarded for creating things inside the games and the players are going to get rewarded for getting to the top levels of all the games and we're going to reward them through our cryptocurrency if we begin to own ourself sovereign identity then when we're owning our data that's the foundation for universal basic income communications completely frictionless payment completely frictionless and governance completely frictionless and we have to put this all together who wins here the average citizen entrepreneur that is leveraged citizen player that wants to start something whether it's a banking a service provider of some sort an entrepreneur or a new financial instrument or firm you all have greenfield opportunity here the first thing I would tell found us is to reach out ok this community is very very supportive like you can reach out to me you can reach out to other guys LinkedIn Facebook or come to these events and say your idea and you need help because you will need help you cannot run this alone ok you are running a company you're running your team have a good team that's the first thing you got to be vigilant and you keeping your money in a hard wallet not keeping your private keys on your computer if you're using a centralized system those centralized systems are really easily exploitable strategic partnerships Advisors founding team and then show the idea to the people explain yourself frankly and honestly and I think the community will reward you to go and find it ring whether you're a fortune 500 company or a startup it's all about building the community and I believe that whether it's utility Target or security or combination of the two it provides an incredible vehicle to ultimately be the catalyst to your community and if you the to community adding value then you're going to build a company event it's always gonna be led by the business model because you need something to act as the power pull to pull the thing along right and you can continuously pump capital into something but if the model is wrong it's just going to drain and it's going to go to inefficient systems and in the end maybe do some help but but a very small percentage of the capacity of what it could do then the advice would be to entrepreneurs don't fret about the infrastructure just nail your business models right and because the switching cost might not be as high as you think that's right we're in the old days when we grew up yeah you made a bad technology decision you're out of business yeah but the first advice that I give my clients is to stomp this is this business that's too much formal in it yeah right if you're missing out so no just because everybody's out there Nico you should be doing an SEO right yeah 46% of I SEOs have already failed already failed start with the business gather this in the counties down right so free cash flow unique value proposition Prada market fit what sits under business think about the token model right the token model has to go in handy now with your business model and revenue model and once you figure out that business and took the models now it's time to think about compliance I'm gonna raise money in the US and abroad I've decided to go to security choking hypothetical instance absolute what do I do is there for you an incentive mechanism or is a fundraising mechanism or both who's gonna be my user who's gonna use this token right there aren't gonna be moms dads hospitals they was my target and then how they're gonna use it and are they gonna hold it I'm gonna sell it are they gonna trade it so all these different things define that oh c'mon once you get your token actually authenticated realized everything's transparent and it gets on that secondary market it's better to use that to invest in anything you need investment get everybody incentivized around your token all your employees all your vendors everybody incentivize around that token it's a thousand percent more powerful than a dollar so the dollar doesn't go up in value in your token your token can go up and down and as soon as you find just one spark it blows up everybody boats rise equal it's pasta Sara Lee the time to crack open the champagne you still have to demonstrate product market fit you have to help build a market in our particular case so there's a lot of hard work launch it's a start line it's just like it's only a step along the whole process you know what made people get it you showed them the money yeah you showed them the money sometimes people don't you can explain these concepts that are world-changing super high level or whatever people were not actually gonna get it until it's useful to them average business people and senior business people who have typically been shut off to the idea of blockchain are now seeing this as very real and here to stay momentum is just beginning it's gonna be amazing what these guys come up with that's one of the things I love about doing this thing right I'm an old guy and I get to hang around these smart young people makes me feel young again yeah but the other thing that we have and I think you should share it as well as we have to offer to these young guys experience thing we just invented a new category in the ico category an advisor token and a you have to have the stomach for it and I think you just have to be as educated and as you can what government entity can resist for the long term something that's actually trying to provide a better and better and better financial infrastructure you should be able to participate in many different nations who have many different economies that are all really cooperating interdependently to create the best possible life for all human good one dollar will not change your life but if you change your habits you'll change your financial destiny and so my philosophy is get it to a dollar so that every single person can participate and once you start to learn good habits around money and wealth the rest it's a formula like it's a flywheel instead the world will become a better place we'll have better companies positive impact is not counter to profit they go hand in hand the Puerto Rico movement it's a movement while Czech entrepreneurs capital investors the pioneers in the blockchain decentralized Internet are all here this is like the Silicon Valley of the crypto right I think they're calling it crypto island yes TV show we should be honest like it's not lost its crypto island exclusive coverage for Puerto Rico's - Cuba I'm John Ferrari getting the signal here out of all the noise in the market this is what we do this is the cube mission great strip we start week Point agenda open content community thanks for watching [Music]