(upbeat music) >> Hey everyone, welcome back to Chicago theCUBE is live on the floor at AnsibleFest 2022, the first in-person Ansible event that we've covered since 2019. Lisa Martin here with John Furrier. John, great to be here. There's about 1400 to 1500 people here in person, the partner ecosystem is growing and evolving, and that's going to be one of the themes of our next conversation. >> CloudScale is continuing to change the ecosystem, and this segment with AWS is going to be awesome. >> Exactly, we've got one of our alumni back with us, Stefanie Chiras joins us again, senior vice president, partner ecosystem success at Red Hat. and Manasi Jagannatha is also here Global Alliance Manager at AWS. Ladies, welcome to the program. >> Both: Thank you. >> Manasi: Nice to be here. >> Stefanie: Yeah. >> So some exciting news that came out. First of all was great to see you on stage. >> Thank you. >> In front of a live audience. The community is, you talked about this before we went live. The Ansible is nothing, if not the community. So I can only imagine how great that felt to be on stage in front of live bodies announcing the next step with Ansible and AWS. Tell us about that. >> I mean, you can't compete with the energy that comes from a live event. And I remember the first AnsibleFest I came to, it's just this electric feeling born out of the community, born out of collaboration and getting together feeds that collaboration in a way that like nothing else. >> Lisa: Can't do it by video alone. >> You cannot. And so it was so fun cuz today was big news. We announced that Ansible will be available through the AWS marketplace, the next step in our partnership journey. And we've been hearing like most of our announcements, we do these because customers ask for them. And that's really what is key. And the combination of what Red Hat brings to the table and what AWS brings to the table. That's what underpins this announcement this morning. >> Talk about it from a customer demand perspective and how you are not only meeting customers where they are, but you're speaking their language. >> Manasi: Yeah. >> Yeah, there's a couple of aspects and then I want to pass it to Manasi because nothing speaks better than a customer experience. But the specifics I think of what come together is this is where technology, procurement, experience, accessibility all come together. And it took both of us in order to do that. But we actually talked about a great example today, the TransUnion. >> So we have TransUnion, they are a credit reporting company and they're a giant customer. They use RHEL, they use AWS services. So while they were transitioning to the cloud, the first thing they wanted to know was compliance, right? Like, how do we have guardrails around compliance? That was a key feature for them. And then the other piece was how do we scale without increasing the complexity? And then the critical piece was being able to integrate with the depth of AWS services without having to do it over and over again. So what TransUnion did was they basically integrated Ansible automation platform with the AWS Cloud Control API that gave them the flexibility To basically integrate with what, 200 plus services? And it's amazing to see them grow over time. >> What's interesting is that Amazon, obviously cloud has been awesome. We've been covering it since the beginning. DevOps infrastructures code was the dream. Now it's app says code, you have configuration code before that. As cloud goes next level here, we're starting to see a lot more higher level services on AWS being adopted by customers. And so I want to get into how the marketplace deal works. So what's in it for the customer? Because as they bring Ansible across the enterprise and edge, now we're seeing that develop. If I'm the customer, am I buying it through the marketplace? What's the mechanics of the deal? Can I just tap into the bill, explain the marketplace workflow or how it works? >> Yeah, I'd love to do that. So customers come to the marketplace for three key benefits, right? Like one is the consumption based model, pay as you go, you can get hourly, annual, and spot instances. For some services you even get per second billing, right? Like, that's amazing, that's one. And then the other piece is John and Stefanie, as you know, customers would love to draw down on their EDPs, right? Like they want a single- >> EDPs, explain that with acronym. >> It's enterprise discount program. So they want a single bill where they can use third party services and AWS services and they don't have to go through the hustle of saying, "Hey, let me combine all these different pieces." So combining that, and of course the power of Ansible, right? Like customers love Ansible, they've built playbooks. The beauty of it is whatever you want to build on AWS, there is most likely a playbook or a module that already exists. So they can just tap into that and build into- >> Operationally it's a purchasing through marketplace. >> And you know, I mean, being an engineer myself, we always often get caught up in the technology aspect. Like what's the greatest technology? And everyone, as Manasi said, everyone loves the technology of Ansible, but the procurement aspect is also so important. And this is where I think this partnership really comes together. It is natively, Ansible is now, natively integrated into AWS billing. So one bill, you go and you log in. Now you have a Red Hat subscription, you get all the benefits from Red Hat that comes along with that subscription. But the like Ansible is all about simplicity. This brings simplicity to that procurement model and it allows you to scale within your AWS cloud environment that you have set up. And as Manasi mentioned, pull in those other native services from AWS. It's Great. >> It's interesting one of the things that buzzword Lisa and I were just talking as in the industry is the word multiplayer. I've heard people say that's multiplayer software, kind of a gaming analogy. But what you guys are doing is setting up, once they go with Ansible in the marketplace, they're just buying as things get more collaborative off the marketplace. So it kind of streamlines, if I get this right. >> Stefanie: Yep. >> The purchasing process. So they're already in, they just use it's on the bill. Is that kind of how it works? >> Yep. >> Absolutely done, yeah. >> So it the customer has a partnership with us more on the technology side and this particular case and with AWS and the procurement side, it brings that together. >> So multiplayer software, is it multiplayer software? >> We like to talk about multi-partner solutions and I think this provides a new grounding for other partners to come in and build upon that with their services capabilities, with their other technology capabilities. So well clearly in my world, we talk about multi-partner. (both laughs) >> Well, what you're doing is empowering the developers. I know that Red Hat is one of its goals is let's make things much more seamless, much smoother for the developers as the buyer's journey has changed. And John, you've talked about that quite a bit. You're empowering those buyers to actually have a much simpler, streamlined process and to be able to start seeing automation become democratized across organizations. >> Yeah, and one of the things I love about the announcement as well is it pulls in the other values of Ansible automation platform in that simplicity model that you mentioned with like things like certified collections, certified collections that have been built by partners. We have built certified collections, to go along with this offering as well as part of the AWS offering that pulls in these other partner engagements together. And as you said, democratizes not only what we've done together, but what we've done with other partners together. >> Lisa: Right. >> Yeah. >> Can you kind of talk kind of about the depths of the partnership, the co-engineering, and sort of the evolution and the customer involvement in the expansion of the partnership? >> Yeah, I'd love to walk you through that. So we've had a longstanding partnership coming up on 15 years now Stefanie, can you believe it? >> Stefanie: Yeah. (laughs) >> 15 years we've been building, to give you some historical context, right? In back in 2008 we launched RHEL and in 2015 we supported SAP workloads on RHEL. And then the list goes on, right? Like we've been launching Graviton instances, Arm instances, Nitro. The key to be noted here is that every new instance Launch, RHEL has always been supported on day one, right? Like that's been our motto. So that's one. And then in 2021, as you know, we launched Rosa Red Hat OpenShift service on AWS. And that's helped customers with their modernization journey to AWS. So that's been context historically around where we were and where we are today. And now with Ansible, it just gives customer another tool in their arsenal, right? And then the goal is to make sure we meet customers where they are, give them all the Red Hat products that they love using on their hybrid workloads. >> Sounds like a lot is coming maybe at re:Invent too, coming up. >> Yeah. >> What's next? >> This is the beginning, right? We'll continue to grow and based upon not only laying the building blocks for what customers can build with, and you mentioned Lisa, right? We follow this journey that Manasi talked about because of what customers ask for. So it's always a new adventure to determine what'll come next based upon what we hear from our joint customers. >> On that front though, Stefanie, talk about the impact of the broader ecosystem that this is just scratching the surface. >> One of the things, and we've been going through a whole transformation at Red Hat about how we engage with the ecosystem. We've done organizational shifts, we've done a complete revamp of how we engage with the ecosystem. One of our biggest focus is to make sure that the partnerships that we have with one partner bring value to the rest of our partners. No better example than something like this when we work with AWS to create accessibility and capability through a procurement model that we know is important to customers. But that then serves as a launch point for other partners to build certified collections around or now around validated content, which we talked about today at AnsibleFest, that allows other partners to engage. And we're seeing a huge amount in services partners, right? Automation is so pervasive now as customers want to go out and scale. We're seeing services partners really come in and help customers go from, it's always challenging when you have a broad set of IT. You have cloud native over here, you have bare metal over here, you have virtual, it's complex. >> John: Yeah. >> There's sometimes an energy activation barrier to get over that initial automation. We're seeing partners come in with really skilled services capabilities to help customers get over that hump to consolidate with an automation plan. It gets them better equipped to do day one automation and day two automation. And that's where Ansible automation platform is going. It's not just about configuration management, it's about day two management as well. >> Talk about those barriers a little bit more and how Ansible and AWS together are helping customers really knock those out of the park. Another baseball reference for you. We see that a lot of organizations, the skills gap, which we've talked about already on the conversation today, but Ansible as being a facilitator of helping organizations to attract talent, to retain talent, but also customers that maybe don't know where to start or don't know how to determine the ROI that automating processes will bring. How can this partnership help customers nock those out of the park? >> So I'll start and then I'll pass it to Manasi here. But I think one of the key things in this particular partnership is just plain old accessibility. Accessibility, which public cloud has taught the world a new way to get fast access that consumption based pricing. Right you can get your hands on it, you can test it out, you can have a team go in and test it out, and then you can see it's built for scale. So then you can scale it as far as you want to go forward. We clearly have an ecosystem of services partners, so does AWS to help people then sort of take it to the next level as they want to build upon it. But to me the first step is about accessibility, getting your hands dirty. You can build it into those committed spend programs that you may have with AWS as well to try new things. But it's a great test bed. >> Absolutely. And then to add to what Stefanie said, together Red Hat and AWS, we have about a hundred thousand partners combined, right? Like resellers, sis, GSI, distributors. So the reach the combined partnership has just amplifies. >> Yeah, it's huge news. I think it's a big deal because you operationalize the heavy lifting of procurement for all your joint customers and the scale piece is huge. So congratulations. I think it's going to make a lot of money for Ansible. So good call there. My question is, as we hear here, the next level's edge. So AWS has been doing a ton of hybrids since outpost announcement years ago. Now you got all kinds of regional expansions, you've got local zones, you've got all kinds of new edge activity. So are there dots connecting here with the edge with Red Hat Ansible? >> Do you want- >> Yeah, so I think we see two trends with our customers, right? Like mainly I'm specifically talking about our RHEL customer base on AWS. We have almost hundreds to thousands of customers using RHEL on AWS. These are 90% of fortune 500 companies use RHEL, right? So with that customer base, they are looking to expand your point into the edge. There's outposts, there are so many hybrid environments that they're trying to expand in. So just adding Ansible, RHEL, Rosa, OpenShift, that entire makes, just gives customers that the plethora of products they need to run their workloads everywhere, right? Like we have certifications outpost, we have certifications with OpenShift, right? So it just completes the puzzle, if you- >> So it's a nice fit. >> Yeah. >> It is a really nice fit. And I love Edge and Edge once you start going distributed, this automation aspect is key for all the reasons, for security reasons to make sure you do it the same way every single time. It's just pervasive in it. But things like the Cloud Control API allow it to bridge into things like Outpost. It allows a simple way, one clean way to do API and then you can expand it out and get the value. >> So this is why you are on stage and you said that Ansible's going to expand the scope to be more enterprise architecture. >> Stefanie: That's right. >> That's essentially what you're getting at. This is now a distributed computing fabric at cloud scale on AWS. >> Stefanie: That's right. >> Did I get that right? >> Yep, and it touches all the different deployments you may have, on-prem, virtual, cloud native, you name it. >> So how do the people turn into architects? Cuz this is, again, we had this earlier conversation with Tom, multi-tool players, a baseball analogy I used. It's like signifies the best player, your customers are becoming multiple tool players or operators. The new operator is now the top talent. They got to run Ansible, they got to automate, they got to provide services to the cloud native developers. So this new role is emerging, it's not a cloud architect but it's, if it's going to be system architecture wide, what's this new person look like that's going to run all this? >> I think it's an interesting question. We were talking yesterday, actually, Tom and I were talking with the partners. We had Partner Day, the first ever at AnsibleFest yesterday, which was great. We got a lot of insight. They talked a lot about this platform focus, right? Customers are looking to create that platform so that the developers can come in and build upon it without compromising what they want to do. So I do think there's a move in that direction to say how do you create these platforms at a company that no compromises, but it provides that consistency. I would say one thing in partnerships like this, I think customer expectations on the partner ecosystem to have it be trusted is increasing. They expect us as we've done to have our engineers roll up their sleeves together to come to the table together. That's going to show up in our curated content. It's going to show up in our validated content. Those are the places I think where we come up from the bottom through our partnership and we help bridge that gap. >> John: Awesome. >> And trust was brought up a number of times this morning during the keynote. We're almost out of time here, but I think it's one of those words that a lot of companies use. But I think what you're showing is really the value in it from Ansible's perspective from AWS's perspective and ultimately the value in it for the customer. >> Stefanie: Yes. >> So I got to ask you one final question. >> Stefanie: Absolutely. >> And maybe as as reinvent is around the corner, what's next for the partnership? Obviously big news today, Manasi, looking down down the pipe- >> Stefanie: Big news today. >> What are some of the things that you think are going to become next that you can share? >> I mean at this point, and I'll pass it to Manasi to close us out, but we are continuing to follow, to meet our customers where they want to be. We are looking across our portfolio for different ways that customers want to consume within AWS. We'll continue to look at the procurement models through the partner programs that Manasi and the team have had. And to me the next step is really bringing in the rest of the ecosystem. How do we use this as a grounding step? >> Yeah, absolutely. So we are always listening to customer feedback and they want more Red Hat products in the marketplace. So that's where we'll be. >> In the marketplace. >> Congratulations great deal. >> Yes great work there guys. And customers always want more. That's the thing. But that's what keeps us going. So we love it. >> Absolutely. >> Thank you so much for joining John and me on the program today. It's been great to have you. And congratulations again. >> It's a pleasure. >> Thank you. >> For our guests and for John Furrier, I'm Lisa Martin. You're watching theCUBE Live from Chicago at AnsibleFest 2022. This is only day one of our coverage. We'll be back after a short break for more. (upbeat music)

(upbeat music) >> Welcome back, everyone, to theCUBE's live coverage, day one wrap-up. I'm John Furrier, with Dave Vellante. We have Jerry Chen, special guest who's been with us every year on theCUBE since inception. Certainly every AWS re:Invent, nine years straight. Jerry Chen, great to see you for our guest analyst's wrap up VC general partner, Greylock partners, good to see you. >> John, Dave, it's great to see you guys. Thanks for having me again. It wouldn't be re:Invent without the three of us sitting here and we missed last year, right, because of COVID. So we have to make up for lost time. >> John: We did a virtual one- >> Dave: we did virtual stuff= >> John: wasn't the same as in-person. >> Dave: Definitely not the same. >> Jerry: Not the same thing. So, it's good to see you guys again in person, and less than 6 feet apart. >> Cheers, yeah. >> And 7,000 people here, showing that the event's still relevant. >> Jerry: Yeah. >> Some people would kill for those numbers, it's a bad year for Amazon, down from 60,000. >> Jerry: Yeah. >> So, ecosystem's booming. Okay, let's get to it. Day one in the books, new CEO, new sheriff in town, his name's Adam Selipsky. Your take? >> Well, Adam's new, but he's old, right? Something, you know, like something new, something old, something blue, right? It's so, Adam was early Amazon, so he had that founding DNA. Left, you know, CEO of Tableau, acquired by Salesforce, came back few months ago. So I think it was a great move, because one, he's got the history and culture under Jassy, so he's definitely the Bezos Jassy tree of leadership, but yet he's been outside the bubble. Right? So he actually knows what it means to run a company not on the Amazon platform. So, I think Adam's a great choice to lead AWS for what we call it, like maybe act two, right? Act one, the first X years with Jassy, and maybe this is the second act under Adam. >> Yeah. And he's got- and he was very technical, hung around all the techies, James Hamilton, DeSantis, all the engineers, built that core primitives. Now, as they say, this cloud next gen's here, act two, it's about applications. >> Jerry: Yeah. >> Infrastructure as code is in place. Interesting area. Where's the growth come from? So, look, you know, the ecosystem has got to build these super clouds, or as you say, Castles on the Cloud, which you coined, but you brought this up years ago, that the moats and the value has to be in there somewhere. Do you want to revise that prediction now that you see what's coming from Selipsky? >> Okay, well, so let's refresh. Greylock.com/castles has worked out, like we did, but a lot of thought leadership and the two of you, have informed my thinking at Castles in the Cloud, how to compete against Amazon in the cloud. So you'd argue act one, the startup phase, the first, you know, X years at Amazon was from 2008 to, you know, 2021, the first X years, building the platform, digging the moats. Right? So what did you have? You have castle the platform business, economies of scale, which means decreasing marginal costs and natural network effects. So once the moat's in place and you had huge market share, what do you for act two, right? Now the moats are in place, you can start exploring the moats for I think, Adam talked about in your article, horizontal and verticals, right? Horizontal solutions up the stack, like Amazon Connect, CRM solutions, right? Horizontal apps, maybe the app layer, and verticals, industrials, financials, healthcare, et cetera. So, I think Jassy did a foundation of the castle and now we're seeing, you know, what Adam and his generation would do for act two. >> So he's, so there's almost like an act one A, because if you take the four hyperscalers, they're about, maybe do 120 billion this year, out of, I don't know, pick a number, it's many hundreds of billions, at least in infrastructure. >> Jerry: Correct. >> And those four hyperscalers growing at 35% collectively, right? So there's some growth there, but I feel like there's got to be deeper business integration, right? It's not just about IT transformation, it's about deeper- So that's maybe where this Connect like stuff comes, but are there enough of those? You know, I didn't, I haven't, I didn't hear a lot of that this morning. I heard a little bit, ML- >> Jerry: Sure. >> AI into Connect, but where's the next Connect, right? They've got to do dozens of those in order to go deeper. >> Either, Dave, dozens of those Connects or more of those premise, so the ML announcement was today. So you look at what Twilio did by buying Segment, right? Deconstruct a CRM to compete against Adam Selipsky's old acquire of Salesforce.com. They bought Segment, so Twilio now has communicates, like texting, messaging, email, but all the data come from Segment. >> Dave: With consumption-based pricing. >> With consumption-based pricing. So, right? So that's an example of kind of what the second act of cloud looks like. It may not look like full SaaS apps like Salesforce.com, but these primitives, both horizontally vertically, because again, what does Amazon have as an asset that other guys don't? Install based developers. Developers aren't going to necessarily build or consume SaaS apps, but they're going to consume things like these API's and primitives. And so you look around, what's cloud act two look like? It may not be VM's or containers. It may be API's like Stripe and Billing, Twilio messaging, right? Concepts like that. So, we'll see what the next act at cloud looks like. And they announced a bunch of stuff today, serverless for the data analytics, right? So serverless is this move towards not consuming raw compute and storage, but APIs. >> What about competition? Microsoft is nipping at the heels of AWS. >> Dave: John put them out of business earlier today. [John and Dave Laugh] >> No, I said, quote, I'll just- let me rephrase. I said, if Amazon goes unchecked- >> Jerry: Sure. >> They'll annihilate Microsoft's ecosystem. Because if you're an ISV, why wouldn't you want to run on the best platform? >> Jerry: Sure. >> Speeds and feeds matter when you have these shifts of software development. >> Jerry: You want them both. >> So, you know, I mean, you thought about the 80's, if you were at database, you wanted the best processor. So I think this Annapurna vertical integrated stacks are interesting because if my app runs better and I have a platform, prefabricated or purpose-built platform, to be there for me, I'm going to build a great SaaS app. If it runs faster and it cost less, I'm going to flop to Amazon. That's just, that's my prediction. >> So I think better changes, right? And so I think if you're Amazon, you say cheaper, better, faster, and they're investing in chips, proprietary silicon to run better, faster, their machine learning training chips, but if you're Azure or Google, you got to redefine what better is. And as a startup investor, we're always trying to do category definition, right? Like here's a category by spin. So now, if you're Azure or Google, there are things you can say that are better, and Google argued their chips, their TensorFlow, are better. Azure say our regions, our security, our enterprise readiness is better. And so all of a sudden, the criteria "what's better" changes. So from faster and cheaper to maybe better compliance, better visibility, better manageability, different colors, I don't know, right? You have to change the game , because if you play the same game on Amazon's turf, to your point, John, it- it's game over because they have economies of scale. But I think Azure and Google and other clouds, the superclouds, or subclouds are changing the game, what it means to compete. And so I think what's going on, just two more seconds, from decentralized cloud, being Web 3 and crypto, that's a whole 'nother can of worms, to Edge compute, what Cloudflare are doing with R2 and storage, they're trying to change the name of the game. >> Well, that's right. If you go frontal against Amazon, you're got to get decimated. You got to move the goalposts for better. And I think that's a good way to look at it, Dave. What does better mean? So that's the question that's on the table. What does that look like? And I think that's an unknown, that's coming. Okay, back to the start-ups. Category definition. That's an awesome term. That to me is a key thing. How do you look at what a category is on your sub- on your Castles of the Cloud, you brought up how many categories of- >> Jerry: 33 markets and a bunch of submarkets, yeah. >> Yeah. Explain that concept. >> So, we did Castle in the Clouds where my team looked at all the services offered at Azure, Google, and Amazon. We downloaded the services and recategorized them to like, 30 plus markets and a bunch of submarkets. Because, the reason why is apples to apples, you know, Amazon, Google, Azure all have databases, but they might call them different things. And so I think first things first is, let's give developers and customers kind of apples to apples comparisons. So I think those are known markets. The key in investing in the cloud, or investing in general, is you're either investing in budget replacement, replacing a known market, cheaper, better database, to your point, or a net new market, right? Which is always tricky. So I think the biggest threat to a lot of the startups and incumbents, the biggest threat by startups and incumbents, is either one, do something cheaper, better in a current market, or find a net new market that they haven't thought about yet. And if you can win that net new market before the rest, then that's unbelievable. We call it the, you know, the blue ocean strategy, >> Dave: Is that essentially what Snowflake has done, started with cheaper, better, and now they're building the data cloud? >> Jerry: I think there's- it's evolution, correct. So they said cheaper, better. And the Castle in the Cloud, we talked about, they actually built deep IP. So they went a known category, data warehouses, right? You had Teradata, Redshift, Snowflake cheaper, better, faster. And now let's say, okay, once you have the customers, let's change the name of the game and create a data cloud. And it's TBD whether or not Snowflake can win data cloud. Like we talked about Rockset, one of my investments that's actually move the goalpost saying, oh, data cloud is nice, but real time data is where it's at, and Snowflake and those guys can't play in real time. >> Dave: No, they're not in a position to play in real time data. >> Jerry: Right. >> Dave: I mean, that's right. >> So again, so that's an example of a startup moving the goalpost on what previously was a startup that moved the goalpost on an incumbent. >> Dave: And when you think about Edge, it's going to be real-time AI inferencing at the Edge, and you're right, Snowflake's not set up well at all for that. >> John: So competition wise, how do the people compete? Because this is what Databricks did the same exact thing. I have Ali on the record going back years, "Well, we love Amazon. We're only on Amazon." Now he's talking multicloud. >> So, you know, once you get there, you kind of change your tune cause you've got some scale, but then you got new potential entrants coming in, like Rockset. >> Jerry: Correct. >> So. >> Dave: But then, and if you add up the market caps of just those two companies, Databricks and Snowflake, it's much larger than the database market. So this, we're defining new markets now. >> Jerry: I think there's market cap, especially Snowflake that's in the public market, Databricks is still private, is optimism that there's a second or third act in the database space left to be unlocked. And you look at what's going on in that space, these real-time analytics or real-time apps, for sure there's optimism there. But, but to John's point, you're right, like you earn the right to play the next act, but it's tricky because startups disrupt incumbents and become incumbents, and they're also victims their own success, right? So you're- there's technical debt, there's also business model debt. So you're victims of your own business model, victims of your own success. And so what got you here may not get you to the next phase. And so I think for Amazon, that's a question. For Databricks and Snowflake, that's a question, is what got them here? Can they play to the next act? And look, Apple did it, multiple acts. >> John: Well, I mean, I think I- [Crosstalk] >> John: I think it's whether you take shortcuts or not, if you have debt, you make it a little bit of a shortcut bet. >> Jerry: Yeah. >> Okay. That's cool. But ultimately what you're getting at here is beachhead thinking. Get a beachhead- >> Jerry: Correct. >> Get in the market, and then sequence to a different position. Classic competitive strategy, 101. That's hard to do because you want to win the beachhead- >> I know. >> John: And take a little technical debt and business model debt, cheat a little bit, and then, is it not fortified yet? So beachhead to expansion is the question. >> Jerry: That's every board meeting, John and Dave, that we're in, right? It's called you need a narrow enough wedge to land. And it is like, I don't want the tip of the spear, I want the poison on the tip of a spear, right? [Dave and John Laugh] >> You want, especially in this cloud market, a super focused wedge to land. And the problem is, as a founder, as investor, you're always thinking about the global max, right? Like the ultimate platform winner, but you don't get the right to play the early- the late innings if you don't make it out of the early innings. And so narrow beachhead, sharp wedge, but you got to land in a space, a place of real estate with adjacent tan, adjacent markets, right? Like Uber, black cars, taxi's, food, whatever, right? Snowflake, data warehouse, data cloud. And so I think the key with all startups is you'll hit some ceiling of market size. Is there a second ramp? >> Dave: So it's- the art is when to scale and how fast to scale. >> Right. Picking when, how fast, in which- which best place, it was tough. And so, the best companies are always thinking about their second or third act while the first act's still going. >> John: Yeah. And leveraging cloud to refactor, I think that's the key to Snowflake, was they had the wedge with data warehouse, they saw the position, but refactored and in the cloud with services that they knew Teradata wouldn't use. >> Jerry: Correct. >> And they're in. From there, it's just competitive IP, crank, go to market. >> And then you have the other unnatural things. You have channel, you have installed base of customers, right? And then you start selling more stuff to the same channel, to the same customers. That's what Amazon's doing. All the incumbent's do that. Amazon's got, you know, 300 services now, launching more this week, so now they have channel distribution, right? Every credit card for all the developers, and they have installed base of customers. And so they will just launch new things and serve the customers. So the startups had to disrupt them somehow. >> Well, it's always great to chat with Jerry. Every year we discover and we riff and we identify, in real time, new stuff. We were talking about this whole vertical, horizontal scale and kind of castles early on, years ago. And now it's happened. You were right. Congratulations. That's a great thesis. There's real advantages to build on a cloud. You can get the- you can build a business there. >> Jerry: Right. >> John: That's your thesis. And by the way, these markets are changing. So if you're smart, you can actually compete. >> Jerry: I think you beat, and to Dave's earlier point, you have to adapt, right? And so what's the Darwin thing, it's not the strongest, but the most adaptable. So both- Amazon's adapt and the startups who are the most adaptable will win. >> Dave: Where are you, you guys might've talked about this, where do you stand on the cost of goods sold issue? >> Jerry: Oh, I think everything's true, right? I think you can save money at some scale to repatriate your cloud, but again, Wall Street rewards growth versus COGS, right? So I think you've got a choice between a dollar of growth versus a dollar reducing COGS, people choose growth right now. That may not always be the case, but at some point, if you're a company at some scale and the dollars of growth is slowing down, you definitely have to reduce the dollars in cost. And so you start optimizing cloud costs, and that could be going to Amazon, Azure, or Google, reducing COGS. >> Dave: Negotiate, yeah. >> John: Or, you have no visibility on new net new opportunities. So growth is about new opportunities. >> Correct. >> If you repatriating things, there's no growth. >> Jerry: It's not either, or- >> That's my opinion. >> Jerry: COGS or growth, right? But they're both valid, definitely, so you can do both. And so I don't think- it's what's your priorities, you can't do everything at once. So if I'm a founder or CEO or in this case investor, and I said, "Hey, Dave, and John, if you said I can either save you 25 basis points in gross margin, or I can increase another 10% top line this year", I'm going to say increase the top line, we'll deal with the gross margin later. Not that it's not important, but right now the early phase- >> Priorities. >> Jerry: It's growth. >> Yeah. All right, Jerry Chen, great to see you. Great to have you on, great CUBE alumni, great guest analyst. Thanks for breaking it down. CUBE coverage here in Las Vegas for re:Invent, back in person. Of course, it's a virtual event, we've got a hybrid event for Amazon, as well as theCUBE. I'm John Furrier, you're watching the leader in worldwide tech coverage. Thanks for watching. (Gentle music)

(smart gentle music) >> Hey, welcome back everyone to theCUBE's coverage of Red Hat Summit 2021 virtual. I'm John Furrier, host of theCUBE, got two great guests here from AWS, Bob Wise, General Manager of Kubernetes for Amazon Web Services and Peder Ulander, Head of product marketing for the enterprise developer and open-source at AWS. Gentlemen, you guys are the core leaders in the AWS open-source initiatives. Thanks for joining us on theCUBE here for Red Hat Summit. >> Thanks for having us, John. >> Good to be here. >> So the innovation that's come from people building on top of the cloud has just been amazing. You guys, props to Amazon Web Services for constantly adding more and raising the bar on more services every year. You guys do that, and now public cloud has become so popular, and so important that now Hybrid has pushed the Edge. You got outpost with Amazon you see everyone following suit. It's pretty much clear vote of confidence from the customers that, Hybrid is the operating model of the future. And that really is about the Edge. So I want to chat with you about the open-source intersection there, so let's get into it. So we're here at Red Hat Summit. So Red Hat's an open-source company and timing is great for them. Now, part of IBM you guys have had a relationship with Red Hat for some time. Can you tell us about the partnership and how it's working together? >> Yeah, absolutely. Why don't I take that one? AWS and Red Hat have been strategic partners since, shoot, I think it's 2008 or so in the early days of AWS, when engaging with customers, we wanted to ensure that AWS was the best place for enterprises to run their Red Hat workloads. And this is super important when you think about, what Red Hat has accomplished with RHEL in the enterprise, it's running SAP, it's running Oracle's, it's running all different types of core business applications, as well as a lot of the new things that customers are innovating. And so having that relationship to ensure that not only did it work on AWS, but it actually scaled we had integration of services, we had the performance, the price all of the things that were so critical to customers was critical from day one. And we continue to evolve this relationship over time. As you see us coming into Red Hat Summit this year. >> Well, again, to the hard news here also the new service Red Hat OpenShift servers on AWS known as ROSA, the A for Amazon Red Hat OpenShift, A for Amazon Web Services, a clever acronym but really it's on AWS. What exactly is this service? What does it do? And who is it designed for? >> Well, I'll let me jump in on this one. Maybe let's start with the why? Why ROSA? Customers love using OpenShift, but they also want to use AWS. They want the best of both. So they want their peanut butter and their chocolate together in a single confection. A lot of those customers have deployed AWS, have deployed OpenShift on AWS. They want managed service simplified supply chain. We want to be able to streamline moving on premises, OpenShift workloads to AWS, naturally want good integration with AWS services. So as to the, what? Our new service jointly operated is supported by Red Hat and AWS to provide a fully managed to OpenShifts on AWS. So again, like lot of customers have been running OpenShift on AWS before this time, but of course they were managing it themselves typically. And so now they get a fully managed option with also simplified supply chain. Single support channels, single billing. >> You know, were talking before we came on camera about the acronym on AWS and people build on the clouds kind of like it's no big deal to say that, but I know it means something. I want to explain, you guys to explain this on because I know I've been scolded saying things on theCUBE that were kind of misspoken because it's easy to say, Oh yeah, I built that app. We built all this stuff on theCUBE was on AWS, but it's not on AWS. It means something from a designation standpoint what does on AWS mean? 'Cause this is OpenShift servers on AWS, we see this other companies have their products on AWS. This is specific designation. Can you share, please. >> John, when you see the branding of something like Red Hat on AWS, what that basically signals to our customers is that this is joint engineering work. This is the top of the strategic partners where we actually do a lot of joint engineering and work to make sure that we're driving the right integrations and the right experience, make sure that these things are accessible and discoverable in our console. They're treated effectively as a first-class service inside of the AWS ecosystem. So it's, there's not many of the on's, if you will. You think about SAP on VMware cloud, on AWS, and now Red Hat OpenShift on AWS, it really is that signal that helps give customers the confidence of tested, tried, trued, supported and validated service on top of AWS. And we think that's significantly better than anything else. It's easy to run an image on a VM and stuffed it into a cloud service to make it available, but customers want better, customer want tighter experiences. They want to be able to take advantage of all the great things that we have from a scale availability and performance perspective. And that's really what we're pushing towards. >> Yeah. I've seen examples specifically where when partners work with Amazon at that level of joint engineering, deeper partnerships. The results were pretty significant on the business side. So congratulations to you guys working with OpenShift and Red Hat, that's real testament to their product. But I got to ask you guys, pull the Amazon playbook out and challenge you guys, or just, create a new some commentary around the process of working backwards. Every time I talked to Andy Jassy, he always says, we work backwards from the customer and we get the requirements, and we're listening to customers. Okay, great. He loves that, he loves to say that it's true. I know that I've seen that. What is the customer work backwards document look like here? What is the, what was the need and what made this become such an important part of AWS? What was the, and then what are they saying now, now that the products out there? >> Well, OpenShift has a very wide footprint as does AWS. Some working backwards documents kind of write themselves, because now the customer demand is so strong that there's just no avoiding it. Now, it really just becomes about making sure you have a good plan so it becomes much more operational at that point. ROSA's definitely one of those services. We had so much demand and as a result, no surprise that we're getting a lot of enthusiasm for customers because so many of them asked us for it. (crosstalk) >> What's been the reaction in asking demand. That's kind of got the sense of that, but okay. So there's demand now, what's the what's the use cases? What are customers saying? What's the reaction been? >> Lot of the use cases are these Hybrid kind of use cases where a customer has a big OpenShift footprint. What we see from a lot of these customers is a strong demand for consistency in order to reduce IT sprawl. What they really want to do is have the smallest number of simplest environments they can. And so when customers that standardized on OpenShift really wants to be able to standardize OpenShifts, both in their on premises environment and on AWS and get managed service options just to remove the undifferentiated heavy lifting. >> Hey, what's your take on the product marketing side of this, where you got open-source becoming very enterprise specific, Red Hat's been there for a very long time. I've been user of Red Hat since the beginning and following them, and Linux, obviously is Linux where that's come from. But what features specifically jump out in this offering that customers are resonating around? What's the vibe here? >> John, you kind of alluded to it early on, which is I don't know that I'd necessarily call it Hybrid but the reality is our customers have environments that are on premises in the cloud and all the way out to the Edge. Today, when you think of a lot of solutions and services, it's a fractured experience that they have between those three locations. And one of our biggest commitments to our customers, just to make things super simple, remove the complexity do all of the hard work, which means, customers are looking for a consistent experience environment and tooling that spans data center to cloud, to Edge. And that's probably the biggest kind of core asset here for customers who might have standardized on OpenShift in the data centers. They come to the cloud, they want to continue to leverage those skills. I think probably one of the, an interesting one is we headed down in this path, we all know Delta Airlines. Delta is a great example of a customer who, joint customer, who have been doing stuff inside of AWS for a long time. They've been standardizing on Red Hat for a long time and bringing this together just gave them that simple extension to take their investment in Red Hat OpenShift and leverage their experience. And again, the scale and performance of what AWS brings them. >> Next question, what's next for a Red Hat OpenShift on AWS in your work with Red Hat. Where does this go next? What's the big to-do item, what do you guys see as the vision? >> I'm glad you mentioned open-source collaboration at the start there. We're taking to point out is that AWS works on the Kubernetes project upstream as does the Red Hat teams. So one of the ways that we collaborate with the Red Hat team is in open-source. One of those projects is on a new project called ACK. It was on controllers for Kubernetes and this is a kind of Kubernetes friendly way for my customers to use an API to manage AWS services. So that's one of the things that we're looking forward to as that goes GA wobbling out into both ROSA and onto our other services. >> Awesome. I got to ask you guys this while you're here, because it's very rare to get two luminaries within AWS on the open-source side. This has been a huge build-out over the many, many years for AWS, and some people really kind of don't understand kind of the position. So take a minute to clarify the position of AWS on open-source. You guys are very active in a lot of projects. You mentioned upstream with Kubernetes in other areas. I've had many countries with Adrian Cockcroft on this, as well as others within AWS. Huge proponents web services, I mean, you go back to the original Amazon. I mean, Jeff Barr was saying 15 years ago some of those API's are still in play here. API's back in 15 years ago, that was kind of not main stream at that time. So you had open standards, really made Amazon web services successful and you guys are continuing it but as the modern era is very enterprise, like and you see a lot of legacy, you seeing a lot more operations that they're going to be driven by open technologies that you guys are investing in. I'll take a minute to explain what AWS is doing and what you guys care about and your mission? >> Yeah. Well, why don't I start? And then we'll kick it over to Bob 'cause I think Bob can also talk about some of the key contribution sides, but the best way to think about it is kind of in three different pillars. So let's start with the first one, which is, around the fact of ensuring that our customer's favorite open-source projects run best on AWS. Since 2006, we've been helping our customers operationalize their open-source investments and really kind of achieve that scale and focus more on how they use and innovate on the products versus how they set up and run. And for myself being an open-source since the late 90s, the biggest opportunity, yet challenge was the access to the technology, but it still required you as a customer to learn how to set up, configure, operationalized support and sustain. AWS removes that heavy lifting and, again, back to that earlier point from the beginning of AWS, we helped customers scale and implement their Apache services, their database services, all of these different types of open-source projects to make them really work exceptionally well on AWS. And back to that point, make sure that AWS was the best place for their open-source projects. I think the second thing that we do, and you're seeing that today with what we're doing with ROSA and Red Hat is we partner with open-source leaders from Red Hat to Redis and Confluent to a number of different players out there, Grafana, and Prometheus, to even foundations like the LF and the CNCF. We partner with these leaders to ensure that we're working together to grow grow the overall experience and the overall the overall pie, if you will. And this kind of gets into that point you were making John in that, the old world legacy proprietary stuff, there's a huge chance for refresh and new opportunity and rethinking or modernization if you will, as you come into the cloud having the expertise and the partnerships with these key players is as enterprises move in, is so crucial. And then the third piece I'd like to talk about that's important to our open-source strategies is really around contribution. We have a number of projects that we've delivered ourselves. I think the two most recent ones that really come top of mind for me is, what we did with Babel Fish, as well as with OpenSearch. So contributing and driving a true open-source project that helps our customers, take advantage of things like an SQL, a proprietary to open-source SQL conversion tool, or what we're doing to make Elasticsearch, the opportune or the primary open platform for our customers. But it's not just about those services, it's also collaborating with key industry initiatives. Bob's at the forefront of that with what we're doing with the CNCF around things, like Kubernetes and Prometheus et cetera, Bob you want to jump in on some of that? >> Sure, I think the one thing I would add here is that customers love using those open-source projects. The one of the challenges with them frequently is security. And this is job zero to AWS. So a lot of the collaboration work we do, a lot of the work that we do on upstream projects is go specifically around kind of security oriented things because that is what customers expect when they come to get a managed service at AWS. Some of those efforts are somewhat unsung because you generally do more work and less talk, in security oriented things. But projects across AWS, that's always a key contribution focus for us. >> Good way to call out security too. I think that's being built-in to the everything now, that's an operating model. People call it shift-left day two operations. Whatever you want to look at it. You got this nice formation going between under the hood kind of programmability of the infrastructure at scale. And then you have the modern application development which is just beginning, programmable DevSecOps. It's funny, Bob, I'd love to get your take on this because I remember in the 80s and during the Unix generation I used to peddle software under the table. Like, here's a copy of, you just don't tell anyone, people in the younger generation don't get the fact that it wasn't always open. And so now you have open and you have this idea of an enterprise that's going to be a system management system view. So you got engineering and you got computer science kind of coming together, this SRE middle layer. You're hearing that as a, kind of a new discipline. So DevOps kind of has won. I mean, we kind of knew this for many, many years. I said this in 2013 on theCUBE actually at re-inventing. I just recently shared that clip. But okay, now you've got SecOps, DevSecOps. So now you have an era where it's a system thinking and open-source is driving all of that. So can you share your perspective because this is kind of where the puck is going. It's an open to open world. That's going to have to be open and scalable. How does open-source and you guys take it to the next level to give that same scale and reliability? What's your vision? >> The key here is really around automation and what we're seeing you could look at Kubernetes. Kubernetes, is essentially a robot. It was like the early design of it was built around robotics principles. So it's a giant software robot and the world has changed. If you just look at the influx of all kinds of automation to not just the DevOps world but to all industries, you see a similar kind of trend. And so the world of IT operations person is changing from doing the work that the robot did and replacing it with the robot to managing large numbers of robots. And in this case, the robots are like a little early and a little hard to talk to. And so, you end up using languages like YAML and other things, but it turns out robots still just do what you tell them to do. And so one of the things you have to do is be really, really careful because robots will go and do whatever it is you ask them to do. On the other hand, they're really, really good at doing that. So in the security area, they take the research points to the largest single source of security issues, being people making manual mistakes. And a lot of people are still a little bit terrified if human beings aren't touching things on the way to production. In AWS, we're terrified if humans aren't touching it. And that is a super hard chasm to cross and open-source projects have really, are really playing a big role in what's really a IT wide migration to a whole new set of, not just tools, but organizational approaches. >> What's your reaction to that? Because we're talking that essentially software concepts, because if you write bad code, the code will execute what you did. So assuming it compiles left in the old days. Now, if you're going to scale a large scale operations that has dynamic capabilities, services being initiated in terminating tear down up started, you need the automation, but if you really don't design it right, you could be screwed. This is a huge deal. >> This is one reason why we've put so much effort into getops that you can think of it as a more narrowly defined subset of the DevOps world with a specific set of principles around using kind of simplified declarative approaches, along with robots that converge the desired state, converge the system to the desired state. And when you get into large distributed systems, you end up needing to take those kinds of approaches to get it to work at scale. Otherwise you have problems. >> Yeah, just adding to that. And it's funny, you said DevOps has won. I actually think DevOps has won, but DevOps hasn't changed (indistinct) Bob, you were right, the reality is it was founded back what quite a while ago, it was more around CICD in the enterprise and the closed data center. And it was one of those where automation and runbooks took addressed the fact that, every pair of hands between service requests and service delivery recreated or created an issue. So that growth and that mental model of moving from a waterfall, agile to DevOps, you built it, you run it, type of a model, I think is really, really important. But as it comes out into the cloud, you no longer have those controls of the data center and you actually have infinite scale. So back to your point of you got to get this right. You have to architect correctly you have to make sure that your code is good, you have to make sure that you have full visibility. This is where it gets really interesting at AWS. And some of the things that we're tying in. So whether we're talking about getops like what Bob just went through, or what you brought up with DevSecOps, you also have things like, AIOps. And so looking at how we take our machine learning tools to really implement the appropriate types of code reviews to assessing your infrastructure or your choices against well-architected principles and providing automated remediation is key, adding to that is observability, developers, especially in a highly distributed environment need to have better understanding, fidelity and touchpoints of what's going on with our application as it runs in production. And so what we do with regards to the work we have in observability around Grafana and Prometheus projects only accelerate that co-whole concept of continuous monitoring and continuous observability, and then kind of really, adding to that, I think it was last month, we introduce our fault injection simulator, a chaos engineering tool that, again takes advantage of all of this automation and machine learning to really help our developers, our customers operate at scale. And make sure that when they are releasing code, they're releasing code that is not just great in a small sense, it works on my laptop, but it works great in a highly distributed massively scaled environment around the globe. >> You know, this is one of the things that impresses me about Red Hat this year. And I've said this before all the covers events I've covered with them is that they get the cloud scale piece and I think their relationship with you guys shows that I think, DevOps has won, but it's the gift that keeps giving in open-source because what you have here is no longer a conversation about the cloud moving to the cloud. It's the cloud has become the operating model. So the conversation shifts to much more complicated enterprise or, and or intelligent Edge, and whether it's industrial or human or whatever, you got a data problem. So that's about a programmability issue at scale. So what's interesting is that Red Hat is on those bandwagon. It's an operating system. I mean, basically it's a distributed computing paradigm, essentially ala AWS concept as a cloud. Now it goes to the Edge, it's just distributed services via an open-source. So what's your reaction to that? >> Yeah, it's back to the original point, John where I said, any CIO is thinking about their IT environment from data center to cloud, to Edge and the more consistency automation and, kind of tools that they're at their disposal to enable them to create that kind of, I think you started to talk about an infrastructure the whole as code infrastructure's code, it's now, almost everything is code. And that starts with the operating system, obviously. And that's why this is so critical that we're partnering with companies like Red Hat on our vision and their vision, because they aligned to where our customers were ultimately going. Bob, you want to, you want to add to that? >> Bob: No, I think you said it. >> John: You guys are crushing it. Bob, one quick question for you, while I got you here. You mentioned getops, I've heard this before, I kind of understand it. Can you just quickly define from your perspective. What is getops? >> Sure, well, getops is really taking the, I said before it's a kind of narrowed version of DevOps. Sure, it's infrastructure is code. Sure, you're doing things incrementally but the getops principle, it's back to like, what are the good, what are the best practices we are managing large numbers, large numbers of robots. And in this case, it's around this idea of declarative intent. So instead of having systems that reach into production and change things, what you do is you set up the defined declared state of the system that you want and then leave the robots to constantly work to converge the state there. That seems kind of nebulous. Let me give you like a really concrete example from Kubernetes, by the way the entire Kubernetes system design is based on this. You say, I want five pods running in production and that's running my application. So what Kubernetes does is it sits there and it constantly checks, Oh, I'm supposed to have five pods. Do I have five? Well, what happens if the machine running one of those pods goes away. Now, suddenly it goes and checks and says, Oh, I'm supposed to have five pods, but there's four pods. What action do I take to now try to get the system back to the state. So you don't have a system running, reaching out and checking externally to Kubernetes, you let Kubernetes do the heavy lifting there. And so it goes through, goes through a loop of, Oh, I need to start a new pod and then it converges the system state back to running five pods. So it's really taking that kind of declarative intent combined with constant convergence loops to fully production at scale. >> That's awesome. Well, we do a whole segment on state and stateless future, but we don't have time. I do want to summarize real quick. We're here at the Red Hat Summit 2021. You got Red Hat OpenShift on AWS. The big news, Bob and Peder tell us quickly in summary, why AWS? Why Red Hat? Why better together? Give the quick overview, Bob, we'll start with you. >> Bob, you want to kick us off? >> I'm going to repeat peanut butter and chocolate. Customers love OpenShift, they love managed services. They want a simplified operations, simplified supply chain. So you get the best of both worlds. You get the OpenShift that you want fully managed on AWS, where you get all of the security and scale. Yeah, I can't add much to that. Other than saying, Red Hat is powerhouse obviously on data centers it is the operating system of the data center. Bringing together the best in the cloud, with the best in the data center is such a huge benefit to our customers. Because back to your point, John, our customers are thinking about what are they doing from data center to cloud, to Edge and bringing the best of those pieces together in a seamless solution is so, so critical. And that that's why AW. (indistinct) >> Thanks for coming on, I really appreciate it. I just want to give you guys a plug for you and being humble, but you've worked in the CNCF and standards bodies has been well, well known and I'm getting the word out. Congratulations for the commitment to open-source. Really appreciate the community. Thanks you, thank you for your time. >> Thanks, John. >> Okay, Cube coverage here, covering Red Hat Summit 2021. I'm John Ferry, host of theCUBE. Thanks for watching. (smart gentle music)

>> Man: Live from Boston, Massachusetts, it's theCUBE, covering Red Hat Summit 2019. Brought to you by Red Hat. >> And we are back live in Boston as we continue our coverage here on theCUBE of Red Hat Summit 2019. It is our sixth year here at the show and this year obviously some huge announcements. A significant moment it's been for Red Hat, we heard from Jim Whitehurst a little bit ago. Stu Miniman, John Walls, we're now joined as well by Niall Fitzgerald, who is the GM of IT Application Architecture and Design at Spark NZ. Niall, good afternoon, or I guess good morning still we're in an Eastern time zone. >> Yeah it's the middle of the night in New Zealand I'd say. >> Yeah, so Spark NZ New Zealand. Tell us a little bit first off about Spark NZ. What the folks back home are doing right now, work-wise, and your role with the company. >> Yeah, so Spark is the largest provider of telecommunication services in New Zealand. All the traditional type of services you'd expect, mobile, broadband, et cetera. We came out of the traditional kind of post office, so we've a lot of heritage, and about four years ago we rebranded from Telecom New Zealand into Spark. To represent that we were changing from being a telco into much broader range of digital services. Our purpose is to help all New Zealanders win big in the digital world. >> Niall, step back for a second. Talk to our audience that might not know the telecom industry as well as you, I've been an observer and participator in the industry but you know back in the dot com boom it was like limitless bandwidth and we're gonna do all these wonderful things, and cloud and digitization, have put some new opportunities as well as stresses and strains on your industry so, you know what's going on and you said you rebranded? >> Yeah, look, I think it's well-known it's been a tough last few years for most telcos in the world. I was listening to Red Hat talking yesterday about 60 consecutive quarters or more of growth, I don't think there's any telco in the world that probably has the same story. Like most, we're facing kinda decline in all the traditional revenues like voice and text and things like that, so we're all having to kinda rebrand ourselves and deliver much higher levels of customer service. People expect the same levels of service from us that they do from Amazon, Google, and everyone else. In Spark what that means to us is we've moved into lots of new things as you said, things like ICT, we're now very big in cloud, we've recently launched a Spark Sports brand and we've got streaming right to the key events like Formula 1. We're going to stream the Rugby World Cup, which is a massive event for New Zealanders, so looking forward to seeing that and Ireland on the all blacks in the final in September this year. So yeah, lot going on. Tough times but forcing us to keep changing every year. >> And so, about these changes that you're making whether technologically based, let's just deal with that. What is that ultimately going to do for you in terms of better customer service delivery? So, you've got inherent challenges, you've talked about them at all, that the world's changing, how we use this medium, this communication opportunity is changing, and you've been just a little behind the wave, hard to keep up with it, so rapidly changing. How much of a challenge is that? And then how are you going to address this going forward? How do you stay relevant? >> Yeah I think we're lucky in one regard because if I look back about five, seven years ago we were like most traditional telcos. We had a spaghetti for want of a better description of systems, and then we had all was multiples of everything, at the time we had 19 integration layers and 10 billing systems and it wasn't uncommon. But way back in 2012 we actually embarked on a massive transformation program, and we spent five years consolidating all of that infrastructure so going into about 2017 we were very lucky in that we had a massive foundation laid already, so what that then enabled us to do was to actually push away calls from our contact centers into mobile apps, into digital adoption. We've been a big embracer of things like big data and robotic process automation as well to try and take cost out of our industry. So, I think we're quite well placed. Now that allows us to do things like innovate new products for our customers so we bundle things like Spotify and Netflix. It allows to introduce things like Spark Sports brand, which we couldn't have done five years ago before the transformation We just wouldn't have been able to enable these things with our existing kind of legacy IT estate. >> So how's open-source play into all this for you? >> Yeah open-source, I suppose our first foray into open-source was when we went to start embracing big data and automation. So we started using things like Hadoop and various other things and our entire platform is based around open-source. We changed to an IMS network recently and we started embracing things like OpenStack, and then it really took us to a new level recently when we started working on Red Hat's Fuse, and OpenShift we started implementing that. >> Okay, so the OpenStack show for many years, the last few years we saw the telcos coming in specifically for network function virtualization or NFV. Is that what you're using in that space? >> Yeah, we are. Interestingly, at this conference I've heard a lot of people talk about OpenShift and OpenStack, obviously, particularly in the telco game. We actually came out a bit differently from the application space. So we had an integration platform that we had put in through this transformation phase which had served us well, and was connecting all of our 40, 50 systems together. But it was coming up to a life cycle event, and we decided we'd look externally and see had we options beyond just upgrading it. So we started looking around, and we effectively found Fuse, and in bringing in Fuse we then brought OpenShift in, which is quite different to what I've seen from a number of other people, they're bringing in things like OpenShift and building on top of it. We did it the other way around, you know? And we did it primarily for cost reasons, you know? >> Yeah, so talk a little bit about that impact of Fuse and OpenShift, what that means. Were you already down the containerization journey, or did that help drive >> Niall: No, no some of that modernization? >> That's exactly what happened. If I'm honest we hadn't really explored containerization too much because we had come to the end of our kind of transformation journey. Open-source and containerization wasn't around when we went through that. So we kinda needed some really core reasons to move on, so, yeah effectively what happened was we looked at Fuse, I was gonna say primarily for cost, but we were looking for something that we could migrate to where it makes sense. We were looking for something that wasn't a massive lift for the people who worked in our integration already, so they could be rescaled into it, and interestingly we turned agile recently which has changed the way we look at the needs of our systems. So our old integration platform, if we needed to deploy a change we had to take an outage, which was fine when we had a centralized IT department who deployed once a month and took a two hour outage, but when you have 20 tribes all developing features in isolation and they wanna go straight through to production, if everybody took an outage then our systems wouldn't really be up very often. So one of the key things that we were looking at for our new integration platform was can we deploy hot and can we scale? So that's basically where Fuse came into us. >> Okay, so can you? >> We can and we do. Still a little bit nervous about pressing the button mid-day and doing stuff >> Right, simultaneously and thinking this has really gotta work, right? >> Yeah then normally, >> We saw it today though on the demo stage, on the keynote. You know, simultaneous operations going on. >> No, we do it, and they normally don't tell me when they're doing it they just do it and tell me it worked afterwards, but no it's actually been really successful and you can imagine connection 40 or 50 systems together is effectively the equivalent of about 2,000 API's and we managed to migrate, we're about 70% of the way through. But we've managed to migrate those without actually impacting the systems that use them and that's probably been one of our most successful IT projects that I've seen. >> It's funny, you said we were towards the end of our transformation journey, and of course I think we all understand, it is just, I might've reached a marker in my journey, but it needs to be a continuous process. And you went through an agile transformation. So bring us in a little bit. Organizationally, what happened there. Some of the good, the bad, and the ugly of agile, 'cause I mean agile's always an ongoing thing. >> It is, yeah. So about the start of last year we started to think about agile and the need to change our ways of working. And we looked at a number of models overseas, and companies like Spotify and various banks, and we settled on a model of chapter and tribes. And we took about six months in looking at what that meant for us as an organization and all of the things that we needed to change. Everything from, people's contracts to people's titles. We got rid of all complex titles and moved down to simple things like Developer, Tester, et cetera. We had to train our people in agile so we ran boot camps for over 2,000 people. We had one with 500 people attend. We had to review all of our processes and see where we had centralized things like IT governance or procurement. How do you actually manage this when you have up to 20 different people effectively, or tribes doing their own developments, so over a period of about six months we went through all of these. We started with a concept of some forerunner tribes so we could figure out how this thing actually works, you know? And get some lessons. And then on the first of July last year, about a 2,000 people in various buildings packed up their stuff in their desks and moved into a new world, into their tribes with different working spaces and different collaboration areas and all the tools that we need. So, yeah we're about nine months down that journey now and it's been good. >> How many total employees? >> We have about 5,000 in total. >> 5,000, so you had 500 at one time. 10% of your workforce in training at one time. >> That's right, yeah. Absolutely. >> How do you keep the wheels on the bus rolling? Because I mean you're asking people not only to learn new skills, but learn them in a new environment, and learn them literally in a new place. I mean that's just massive change and I think, we're human beings. We're creatures of habit to a certain extent. You had to hit a lot of bumps along the way. >> Yeah, so one of the key things we did upfront was we said the operate part of our business, which is effectively things like our contact center, our sales staff, our service desks, we will not go agile with those on the first day, because they operate in a slightly different way of working. The people in our stores, et cetera. So we had a concept of agile light and agile heavy. So we kinda parked them for a minute so that we wouldn't do exactly what you say and let the wheels fall off the trolley. And we took to people that were the IT developers, the product development staff, and all of that, which came to just over about 2,000 people, and we firstly flipped those 2,000 people and put those through bootcamp. But even as you say, scheduling the boot camps, we made sure that we always had the right people on the ground and we would schedule smaller boot camps for them later if we needed to do it, but yeah. >> So nine months in now. You talking to your peers, if they're gonna go through. Any key learnings, what were some of the most challenging things that you ran into? >> I think probably the major one is that agile at its heart is a way of working, and despite the name it's actually quite prescriptive in how you should work, you know? When you pick up the agile book it tells you all the ceremonies you need to run and the processes that you need to run as well. And I think you need to be pragmatic in how you implement it because there are so many different flavors of agile. The one flavor, even with an organization of Spark size, it doesn't work. So the tribes and squads that are building out new products compared to the tribes that are doing things like upgrading systems, they will work in different ways. So I think the first thing is be pragmatic, take the goodness and the intent of agile, but implement it in how it works for you. And there's some other practical considerations, like prior to being agile we had quite a large number of our technology partners were based offshore in India, and you know it's quite difficult to run a 10 AM stand up in New Zealand setting the priorities for the day and the sprint plans, when, you know, four members of your team are asleep in India. You know, they're missing out on all of the goodness and the collocation and the sharing, so one of the things we had anticipated that, so luckily enough we had moved a lot of those people onshore in advance of agile, you know? But it is a big cultural change for everyone in the organization, not least the leadership teams as well. >> John: Well you got through it. >> We got through it, but there's no going back. >> Absolutely, no you're in the deep end now. Well, Niall, thanks for being with us, we appreciate the time joining us here on theCUBE, and I think that an Irishman is always welcomed in Boston. >> Thank you very much! We've been enjoying the hospitality. >> Yeah the door's always open. >> Thank you very much. >> Thank you very much. Niall Fitzgerald, joing us from Spark NZ. Back with more here on theCUBE, you're watching this live at the Red Hat Summit 2019.

>> Narrator: Live from New Orleans, Louisiana, it's theCube covering .NEXT conference 2018, brought to you by Nutanix. >> Welcome back, I'm Stu Minimin joined by Keith Townsend, and we're here at Nutanix .NEXT 2018. Happy to welcome back to the program Binny Gill, who's the CTO of cloud services at Nutanix, and welcome a first time guest, a long time watcher, first-time caller, Vijay Rayapati, who's the general manager of Nutanix Beam a brand new service at NEXT, came from the Minjar acquisition. Gentlemen, thanks so much for joinin' us. >> Thank you for having us. >> Vijay what, so for those that don't know, bring us back a little bit, you know, Minjar tells a little bit about the company, how many people and then we'll get into the integration and the launch. >> Yeah, so we started Minjar in 2012, late 2012, primarily focused on building our public cloud optimization service, so our flagship product is Bot Metric, which is one of the which is one of the high straighter interview solution in the (mumbles) marketplace. We are primarily based in Bangalo, and focused on helping customers as they're moving to this public, our journey, how can you help them deliver governance across their consumption, from a cost perspective. And compliance from a security perspective. That's what we were focused on, and we joined Nutanix last quarter. I'm really excited to be here, I look forward to continue building on it. >> Alright, Binny maybe you can help us connect the dots, so, look at Zai, look at the services that Nutanix is building, usually it starts with your infrastructure. >> Yep. >> And that's not where Minjar came from so, help us connect the dots as to how, what led to the acquisition, how it expands the portfolio, and what's your first SAS product? >> Yeah, I mean if you look at what we are talking about as our true north, what we're doing is we're building a hybrid cloud. We started with building a private cloud, and customers asking us, hey solve the public cloud problem for us, hybrid cloud, multi-cloud. And most of the enterprises today are dispersed. So when we talk about enterprise cloud what we mean is dispersed cloud including IOT devices, you'll see some of that in the demo this evening. So the first question that comes to mind is okay, how am I going to manage all my dispersed cloud entities? And not all of them are owned by Nutanix. So when we looked at Minjar and the capabilities, it was right on target, they're helping customers, consume the cloud and solve the two problems that they have that they lose sleep on, one is do I have control on cost? And the other is do I have control on security compliance? So that's a good capability to have and with Vijay's teams help, we're going to expand it to all the clouds including Nutanix and beyond and provide it to all the customers. >> So today, where is the service, how do I consume it? Help me understand that. >> So this is the first SAS service that Nutanix has launched and it can be consumed from beam.nutanix.com. And we intend to continue on the service in future as a SAS offering, for customers. Both Nutanix customer and non-Nutanix customers. What we have today is we support Amazon cloud, and Azure, and we're working on bringing integration for Nutanix and then we'll bring support for other cloud providers as well. >> So, I'm sorry, just how many customers did you have running on the Bot Metric service in the past? >> We had a couple of hundred customers using Bot Metric, we track close to about a billion dollar plus in public cloud consumption through Bot Metric before it became Nutanix. >> So Vijay, help us understand the larger industry and this larger space. It's been relatively acrotic space for some time, there's been a lot of solutions that helped with cloud security, performance monitoring, et cetera. What was the unique gap or value opportunity you saw at Bot Metric? >> Yeah I mean there are two unique things that we found when we work with these public cloud customers. The challenges are, (mumbles) which are providing this ability, right? But there weren't many tools providing ability to remediate those things that you detect. Essentially form day one, when built Bot Metric platform, we built it like an action-oriented platform. So we not only get visibility, you could essentially automate those issues, either for an optimization or for control. To an automation agent, so there is a lot of invisible automation in Nutanix Beam, versus just being this beautiful UI, which can give you a lot of insights and reports. And that's a big differentiator, that's one of the reasons why a lot of customers when they write reviews of the product, they say man I really love it because it not only tells me what I need to do, I don't need to go and do those hundred things as an engineer, and I can rather click to fix of deploy an automation that can go an do these things, right? >> And one of the other things that was very interesting in what Beam does is, it also can predict what the cost is going to be at the end of the month, instead of being surprised by the end of the month bill, you know how it is today, and how the system is predicting it, and that gives you more control on making sure that if there's an over-expenditure that's going to happen, you can take actions today. >> So what type of automation and adjustments can be made on my behalf? >> Yeah, I think pretty much anything that a cloud ops, or devops engineer do, what we don't do is we don't do any provisioning or orchestration, right? Even as a Bot Metric, we never did that. What we were focused on is, how can we solve operational issues on a day-to-day basis? Whether they're related to cost, or they're related to compliance, or they're related to automation. So it can detect things, you can do custom scaling from Beam, you can do resizing of things, you can clean up unused resources, you can go and run custom audits using Python on Beam. So there are lot of things that day two or a day three on a continuous basis as a cloud ops or a devops engineer that you need to do. That's what we deliver as a invisible automation, or we call it event automation. And so when events happen, how can we automate those things, or right ones use, multiple times. >> Binny, can you walk us through, what kind of Nutanix stamp has been put on the product leading to the Beam, maybe give us a little bit of your philosophy as to how the software acquisitions, what they have to go through before they become real Nutanix products. >> First of all, any acquisition, we want to make sure that the team is a great team. People are the most important. From a technology perspective, they need to be solving the pinpoints of the customers. Now when we integrate any service into our cloud platform, we focus on three things, one is identity. So when a customer logs in to our Zai cloud services, or logs in on PRAM, they should be able to use a single sign-on across all the services. Second thing is billing, we're going to make sure that how we bill the customer, it's not like separate bills that come and they have to put them together, it has to be single billing. Also in terms of how you spend, we're working on programs where you can buy some Nutanix currency coins, and then you can use it either in the private cloud or in the public cloud, but the decision could be a late binding decision. And finally, it's about making sure that the one-click simplicity that we keep talking about and delivering is there. And we've been lucky that with the Beam product, a lot of it is already there, that's why it's already giad. But we make sure that it goes through the same rigor of making sure that the user experience is awesome. >> So let's talk about that time to integration I'll call it. The ability for you guys to take Beam or Bot Metric at that time, a completely separate product from COM, Zai, and then you take that, turn it into Beam, a SAS product, which isn't your first SAS product, How do you keep that consistent view across the entire Nutanix portfolio experience, so that administrators are not leaving one tool to go into another one, which a SAS offering is very different than what you guys have offered in Apetex. >> So we're working on that, both on premises view and in the cloud view. So as you might have noticed when we came up with Zai, we said it's like cloud services. And DR is the first service. 'Cause when you log into Zai, you're logging into all of the cloud services. And then the menu of services will show up, and Beam is one, DR is one, and more will come in, so we wanted to be taught through that. On premises, if you'll notice in our history, we had Prism Central, and then we announced Com Support, and it's baked into Prism, it's not a separate tool. We took one and a half years to make sure that it does not look like a schizophrenic set of products. When we announced Flow, if you look at other vendors like VMware, they have separate NSX manager, and SS controllers, in our case, it's the same Prism Central, once you upgrade, you get that feature. So that's in our discipline, and anything we do, we take the time and make sure it's going to be a single experience for the customer. We're doing the same thing so, Vijay's team this quite rapid and agile and doing stuff, they've integrated with our single identity system, integrating with a single billing system. So that has happened rapidly with this case. >> I think we focus a lot, at least at Nutanix, when I joined, there is a lot of emphasis on experience. How do we make sure we deliver consistent experience for the user from an identity perspective, from a service use perspective, as well as from a support perspective, right? I know it's a common support, it's a common identity, and it's a common billing, and you already touched upon it as we are innovating on a lot of the services, you know, there is a lot of thinking going on, saying you know, how do we bring a common experience, unified experience that is seamless, rather than having different endpoints, people need to go on and try to remember these things. I think we will continue to work on, you know, innovate on that front. But experience is one thing that Nutanix is very good at, you know, if you go onto social media and look at, you know a lot of people are saying, oh man, we really like what we saw from a user experience perspective of the product. And we already took a lot of those design concepts, you know, Nutanix has, in terms of the UI and UX. The Beam that you see today is completely consistent with that 3.0 design philosophy, internally for our products. So the customer has same kind of, experience. Of course it's a SAS service, as Binny said, we are trying to bring lot of this SAS services and Zai cloud services so the user can consume it, just like they consume a GCP or an azure, or AWS, right? And of the day, you have EC to RDS. There is a common frame that brings all this together. >> One additional thing that we're doing, which has not been done before is, providing these services in a hybrid mode. Right, so some of these services like COM, and infrastructure as a service capability, we've announced ARA, how do we provide it in hybrid cloud world where you can run the service on PRAM, you can migrate, adapt it, depends on the service. So the service should also be available in the cloud. And those are some of the hard problems that we are working on, but we believe that we have the tools and the experience to make that happen. >> So, Vijay, just one that was announced, you got some cool new T-shirts you're going to show us. What should we be looking for from the roadmap there? And yeah, show that T-shirt off. (laughter) >> There are two primary things that we are very focused on. One is, how can we bring in lot more intelligence, not just from insights and actions. How can we help customers make those choices of moving the workload, because if you see there're a lot of components that Nutanix is building. Even today we announced Cloud Extract, which is kind of a one-click mobility, not just from cloud to Nutanix, it is going to support from Nutanix to other clouds as well. Because there is a strong cultural belief within the company, that we need to have, give customers the freedom of choice. And deliver a good service, that I prize, so that they feel feel confident about what they're doing, and what we deliver to them. So in that context, one is obviously, bringing multiple clouds. Currently we support Amazon and Azure, but we will bring GCP support, and we will launch, Nutanix, we will launch, other providers as well, we won't start just with them. And the next thing is, how do we make this experience a lot more seamless? And we'll also integrate with COM and a couple of other products that we have as we accline. So that customers can get visibility of cost by workloads by apps, they don't need to come to Beam to consume them. >> So Binny one last question. This is critically important as you bring out your first SAS offering. Billing and procurement, what is the average experience for the Nutanix customer who hadn't- The infrastructure team didn't whip out a credit card and buy a NX system, what is the experience for setting up billing with your SAS services? >> Right, so a lot of it is not giad yet, but if you look at some of the demos that we have done for Zai cloud services, including DIA, It's, the customer can provide a credit card, and consume it as they're used to with the public cloud. But we also have programs where they can buy some credits, Nutanix coins up front, and use them both on PRAM, and in the cloud. So these things are in the works, and we are listening to our customers. One size does not fit all and we know that in the enterprise. But we'll have multiple options for them. >> Excellent, sounds just like, I've listened to my children saying, I get the coins to do fortnite, and things like that that the millennials will be good. They buy some credits, buy it here, buy it there, use it up. Binny and Vijay, thanks so much for joining us. Congrats on the launch of the product we look forward to keeping an eye on it as that grows and the portfolio grows. >> Thank you Stu. >> Thank you for having me. >> For Keith Townsend, I'm Stu Minimin, back with lots more programming here at Nutanix.next 2018, thanks for watchin' theCube. (futuristic music)

>> Narrator: Live, from Las Vegas. It's theCUBE, covering Dell Technologies World 2018. Brought to you by Dell EMC and its ecosystem partners. >> Welcome back, here on theCUBE, our live coverage continues here at Dell Technologies World 2018. We're at the Sands Exposition Center. Along with Keith Townsend, I'm John Walsh. Glad to have you here with us on day one of our three days of coverage here. We're now joined by David Shacochis, who is the Vice President of Product IT Solutions and New Market Development at CenturyLink, and Jim Aluotto. Did I get it right, Jim? >> Jim Aluotto. >> Aluotto. We practiced this many times. Who is the Director of Cloud Provider Business, Americas, at VMware. Gentlemen, in all seriousness, thank you both for being with us. >> Jim: Thank you. >> We certainly appreciate your time. So talking software-defined data centers. First off, let's step really high level here, and just talk about main attributes, qualities. How would you, if your elevator speech would be about what the SDDC would be, how would you describe it, and what are the features? >> Sure, well I'll jump in front of the company that sort of coined the term, and get my answer first, and then let Jim expound from there. Really, I think we can sort of sum up the software-defined data center in a lot of what we've learned in creating a Managed Private Cloud, based on what you would call a software-defined data center platform, in that it minimizes the number of moving parts. We've been doing Managed Private Cloud for as long as Managed Private Cloud has been a thing. And what that used to mean, five, six, years ago, was provision to the network, provision to security devices, maybe it's a converge device, maybe it isn't, maybe it's two different vendors. Sure, you've got vSphere in the middle of it all, but now you're talkin' of different storage tiers. If you want different flavors of storage, you're talkin' to multiple vendors back there. Piecing together a private cloud solution used to mean talkin' to a number of different technology stacks, a number of different API frameworks. And so software-defined data center, where the rubber hits the road, and sort of, from the cold face, means just a simplified view of being able to automate all that together, have it all orchestrated, and have it be one common stack. >> Jim: Nicely done. >> Okay, well, you go do the bookish version. >> Well really, in its most simplistic form, spinning up end-to-end complete automation across compute, network, and storage assets. And lately we've gone to market with VMware Cloud Foundation, that CenturyLink is now spinning up as the root of their service that they're going to market with. And so we've gone through an evolutionary process over the years, where we've proven to the world the advantages of virtualization, virtualize and compute. VMware, in its Act II, is now virtualizing the network. We're virtualizing storage now with VSAN taking off like wildfire. But now we're stitching it all together, in the form of a complete, end to end, automated and provisioned, encapsulated, virtualized data center. >> And that's the big efficiency here, right? It's one-stop shop, basically. You don't have to go out and as you said, look for a number of different avenues, or different pieces of this puzzle. >> So it does, it drives efficiencies in the data center, but it also drives efficiencies and opportunities around the way you operate it. And one of the things that we've been seeing, and it's sort of foundational to our managed services practice, is that the software-defined data center actually drives software-defined managed services. You have to change the way you do managed services to take advantage of all that capability. We have a service we call Cloud Application Manager, which is really our tool that we use to model applications, deploy managed tooling to that application for 24/7 monitoring and management, and uptime and stability support, and then do analytics on that application, to be able to show cost-savings opportunities, best-practice opportunities, in more of an aggregated, reported way. So Cloud Application Manager is a much more automated version of managed services. It's not ITIL from 10 years ago, right? It's not up/down, just base-level ticketing. You need to be able to change the way you do managed services, and you can only do that if you have a reliable underpinning platform. So less moving parts, a software-defined data center lets you change that, let's you change the way you deliver managed services. >> So the CenturyLink has incredible technical chops. There's always a point where you have to decide, build versus buy. CenturyLink, you can choose to build all of this. You can take parts from the open source community, build extremely custom solutions. Why VMware? When you guys have the technical ability to build it, make a differentiating offering, why start with VMware as the base? >> Yeah, I think you go back to what VMware's been in the market doing, and I even sort of talked past it a second ago. The vSphere's foundation is really solid, right? The device, the flexibility you have with the hardware layer, the flexibility you have at the real core or nucleus of your compute and memory virtualization stack is super important. And then really the idea of building out into the software-defined very common ownership stack, and why VMware was great to partner with, with regards to building out our next-gen Managed Private Cloud offering, is because they've wired everything to work together. And you said there are things you could go and try to build on your own? I think it's interesting. What we're starting to see is that, just to use somethin' like OpenStack, as an example, building a private cloud out of OpenStack is certainly possible, but there's no one company owning it all end to end. And if you're a service provider, it's up to you to go figure it all out. Or you can go and work with maybe one integrator partner, but they're making their own set of choices, and now you're basically locked in to that particular deployment model. So I think working with VMware, what we found is, first off, they've accelerated our time to market, and our time to value around a Managed Private Cloud offering. There's a lot of interoperability in there. There's a lot we're able to do around hybrid applications, because something you deploy to VMware inside VCF is very similar to something you deploy in your own home-grown environment, to one of the Managed Private Clouds that we've been running for five or six years, where there's just a very clean migration and upgrade path with that interoperability. >> And really it's all about the market opportunity that VMware brings to the table. Our cloud strategy is incredibly simplistic, but yet it has such a compelling business and value proposition, not only to our mutual customers that we're going to market in joint pursuit with, but also to our cloud providers, 500,000 plus enterprise customers using VMware. As we take them along the journey, building out their private clouds, that represents over 60 million workloads, with the inevitability of them moving out to the cloud. So what we've teed up is a cloud provider community with our most strategic partner, like CenturyLink, to increase the odds of that, capturing those workloads onto a VMware platform. The market opportunity that we bring to the table for somebody like CenturyLink is quite extensive, let alone all the benefits that the mutual customer gets. They get to protect their data center, their data and application assets, all the reliability, compatibility, security, that they would expect from their own VMware infrastructure, they would expect from a VMware cloud provider, like CenturyLink. >> Well David, let's talk about the interface into CenturyLink. One of the things that customers are startin' to realize is that they have to differentiate, based on just internal IP. So there's the API to everything, now. What's, if you could describe, well, maybe there is. What's the API to CenturyLink, as I'm consuming this software-defined data center that you guys provide? >> Okay, so sure, so that's actually a really exciting opportunity for us, and it's one that we've been sort of pivoting. If you sort of look at the history of CenturyLink, there was a, and this sort of goes back 10 years, but there was a huge spike of CenturyLink's entry into the business to business market. Acquiring quests, getting the business that basically announced their entrance into the B2B marketplace. Then there was a number of more technology oriented and virtualization management oriented acquisitions, because it recognized two things: one, we needed to be in IT solutions, in cloud, in data center, but also that the network was heading towards a highly virtualized, highly orchestrated, highly software-defined model. The network of the 21st century was not going to be about buying a ton of big iron and putting it into pops anymore, it was going to be increasingly around managing x86 virtualization. So that set off a period of time within CenturyLink where we were acquiring managed services companies, IT solution companies, virtualization companies, that were helping really to increase two things: our ability to virtualize and manage virtualization, and then, secondly, develop software in new ways, and become much more familiar at the application layer. We spent about five or six years with companies like SAVAS, and Tier3, and Cognilytics, really adding to the company in terms of brain power, and know how, and workload fluency. And then now we've just recently closed on the merger and acquisition with Level 3. So now we're very much on a network scale ascendency. The interface into CenturyLink is really taking a lot of those assets that we've built up, and moving them together into more of a platform topology, which is re-architecting the way that we work. We've bought cloud companies, and we invested in virtualization to help us reorganize exactly what you're talking about, which is the way of interfacing with CenturyLink, driving customer experience, being able to have a common user experience, whether you're interacting with it at a CLI, or via an API call, or with a tutorial that you're following via an online interface, and having a common look and feel across those services. So it's a journey. We're still on our way there, but we have the very beginnings of a lot of commonality that's starting to occur, whereby if you log in to our public cloud management service, Cloud Application Manager, or if you log in to our network interconnect service, Network Exchange and Cloud Connect Solutions, or if you log in to our public and private cloud offerings, very common look and feel across the piece, where it's one identity, one billing collection, but then we allow each of those individual services to go and innovate on their own. And that's the key thing. You can go drive common user experience. That's super, but if you're waiting on a portal team to go design your UI for you, you're slowing down. And so we're really bein' able to design a framework whereby there's one common UI, but it's more design patterns that every internal team picks up and works with, and then integrates into their release. >> And it's very important for VMware as well, as we develop our IP that's relevant for cloud provider use cases, is to open up those APIs to do just that, give you the opportunity to own that customer experience and differentiate yourself within the marketplace. >> I think we talked about this last time, too, where VMware's entree into the service provider world really taught them some lessons, and they started adding things to their product that make it easier to be a service provider. And some of the things, like with vCloud Director, and some of the ways that you can now work with that at an HTML5 layer, and sort of create your own version around it, almost interact with vCloud Director at an API level, allows us to factor it in to that mentality of design pattern, thinking in a common UI across all of our services. Right now we're working with a lot of those features on vCloud Director to enable our Managed Private Cloud service. >> So what if the conversation is being then able to show it's all about making it real? What have the real conversations been? >> Yeah, so the real conversations with our customers that we're starting to have are really, and just to tie it a little bit back to this idea of a software-defined data center, I think they're excited by the possibilities. They're certainly looking to really drive instrumentation at more places than they ever were able to drive instrumentation before. And there's the obvious industry examples of IoT, and sensors, and things like that, but even things like business process, and being able to theoretically just rework the way a particular system works, turn it into a micro service, or an application that they can factor in to their overall IT strategy, but then have that start to feed in to a broader data lake that they can then start making business analytical decisions from. That's one of the big patterns that we see, whether it's occurring with a lot of our customers that we work with in the built environment, but in working with the customers that work with CenturyLink, in some of the most deep and influential ways, are the ones that are out there sort of "in space". And I don't mean in space, I mean out there in a geographic spread, like retail solutions, and physical facilities, and things like that, where you have people coming to your location, and you're tryin' to gather all that data back into more of a centralizing motion. That's where we're having some of our most interesting conversations, with those retail brands, with bigger facilities that we want to be able to bring on net, and basically have them turn into data sources for their data lake, that they can then start moving forward and analyzing with some either professional services or tooling, to go and start looking for where those insights lie. >> So for me this is music. What I'm seeing, customers want to wane off of IT functions altogether. They want to invest their resources around their core business. >> John: Their business, right. >> Yeah, exactly. So what they're doin' is, they're relying on the subject matter experts now. The whole notion of being concerned about security, and reliability out in the cloud, that's long gone. They recognize that folks like CenturyLink can deliver at greater economies of scale, more secure, highly available. >> Yeah, and one of the things, one of the best ways we can facilitate those conversations is to share a little bit of our own journey. And it's not because we want to stare at our own product catalog, and walk through it page by page, but to share some of our own journey with the perspective of realizing a long time ago that in our managed security business, it was a big data problem. It's not an implementation and controls problem. And so we've been driving a whole lot more of our story, and some of our service strategy is, not only is it, we feel a lot of these are very valuable services in their own right, but they show off a pattern of: instrument it, drive it back to a data lake, and then take more of an analytical approach to it to add value, as opposed to just being very transactional. >> We talked about the journey. It's been a good one, right? And continued success with that. >> Indeed. >> Thanks for joining us here on theCUBE, and we appreciate the time. >> Okay. >> Good, thank you very much Dave and Jim. Back with more. You're watching theCUBE. We are live, here at Dell Technologies World 2018 in Las Vegas. (percussive music)

>> Announcer: Live from San Francisco it's The Cube covering Oracle OpenWorld 2016 brought to you by Oracle. Now here's your host, John Furrier and Peter Burris. >> Hey welcome back everyone. We are live in San Francisco at Oracle OpenWorld 2016. This is SiliconANGLE, the key of our flagship program. We go out to the events, extract a signal from the noise. I'm John Furrier, Co-CEO of SiliconANGLE with Peter Burris, head of Research at SiliconANGLE as well as the General Manager of Wikibon Research, our next guest is Siddhartha Agarwal, Vice-President of Product Management and Strategy of Oracle Cloud Platform. Welcome back to the Cube, good to see you. >> Yes, hi John. Great to be here. >> So I've seen a lot of great stuff. The core messaging from the corporate headquarters Cloud Cloud Cloud, but there's so much stuff going on in Oracle on all the applications. We've had many great conversations around the different, kind of, how the price are all fitting into the cloud model. But Peter and I were talking yesterday in our wrap-up about, we're the developers. >> Siddhartha: Yeah. >> Now and someone made a joke, oh they're at JavaOne, which is great. A lot of them are at JavaOne, but there's a huge developer opportunity within the Oracle core ecosystem because Cloud is very developer friendly. Devops, agile, cloud-native environments really cater to, really, software developers. >> Yeah, absolutely and that's a big focus area for us because we want to get developers excited about the ability to build the next generation of applications on the Oracle Cloud. Cloud-native applications, microservices-based applications and having that environment be open with choice of programming languages, open in terms of choice of which databases they want, not just Oracle database. NoSQL, MySQL, other databases and then choice of the computeship that you're using. Containers, bare metal, virtual environments and an open standard. So it's giving a very open, modern easy platform for developers so that they'll build on our platform. >> You know, one of the things that we always talk about at events is when we talk to companies really trying to win the hearts and minds of developers. You always hear, we're going to win the developers. They're like an object, like you don't really win developers. Developers are very fickle but very loyal if you can align with what they're trying to do. >> Siddartha: Yeah. >> And they'll reject hardcore tactics of selling and lock-in so that's a concern. It's a psychology of the developers. They want cool but they want relevance and they want to align with their goals. How do you see that 'cause I think Oracle is a great ecosystem for a developer. How do you manage that psychology 'cause Oracle has traditionally been an enterprise software company, so software's great but... Amazon has a good lead on the developers right now. You know, look at the end of the day you have to get developers realizing that they can build excellent, fun creative applications to create differentiation for their organizations, right, and do it fast with cool technologies. So we're giving them, for example, not just the ability to build with Java EE but now they can build in Java SE with Tomcat, they can build with Node, they can build with PHP and soon they'll be able to do it with Ruby and Daikon. And we're giving that in a container-based platform where they don't necessarily have to manage the container. They get automatic scalability, they get back up batching, all of that stuff taken care of for them. Also, you know, being able to build rich, mobile applications, that's really important for them. So how they can build mobile applications using Ionic, Angular, whatever JavaScript framework they want, but on the back end they have to be able to connect these mobile apps to the enterprise. They have to get location-based inside and to where the person is who's using the mobile app. They need to be able to get inside and tell how the mobile app's been used, and you've heard Larry talk about the Chatbot platform, right? How do you engage with customers in a different way through Facebook Messenger? So those are some of the new technologies that we're making very easily available and then at the end of the day we're giving them choice of databases so it's not just Oracle database that you get up and running in the Cloud and it's provision managed, automated for you. But now you can ask for NoSQL databases. You can have Cassandra, MongoDB run on our IaaS and MySQL. We just announced MySQL enterprise edition available as a service in the Public Cloud. >> Yeah one of the things that developers love, you know, being an ex-developer myself in the old days, is, and we've talked to them... They're very loyal but they're very pragmatic and they're engineers, basically they're software engineers. They love tools, great tools that work, they want support, but they want distribution of their product that they create, they're creators, so distribution ultimately means modernization but developers don't harp too much on money-making although they'd want to make money. They don't want to be abandoned on those three areas. They don't want to be disloyal. They want to be loyal, they want support and they want to have distribution. What does Oracle bring to the table to address those three things? >> Yeah, they're a few ways in which we're thinking of helping developers with distributions. For example, one is, developers are building applications that they exposing their APIs and they want to be able to monetize those APIs because they are exposing business process and a logic from their organization as APIs so we're giving them the ability to have portals where they can expose their APIs and monetize the APIs. The other thing is we've also got the Oracle Cloud Marketplace where developers can put their stuff on Oracle Cloud Marketplace so others can be leveraging that content and they're getting paid for that. >> How does that work? Do they plug it into the pass layer? How does the marketplace fit in if I'm a developer? >> Sure, the marketplace is a catalog, right, and you can put your stuff on the catalog. Then when you want to drag and drop something, you drop it onto Oracle PaaS or onto Oracle IaaS. So you're taking the application that you've built and then you got it to have something that-- >> John: So composing a solution on the fly of your customer? >> Well, yeah exactly, just pulling a pre-composed solution that a developer had built and being able to drop it onto the Oracle PaaS and IaaS platform. >> So the developer gets a customer and they get paid for that through the catalog? >> Yes, yes, yes and it's also better for customers, right? They're getting all sorts of capability pre-built for them, available for them, ready for them. >> So one of the things that's come up, and we've heard it, it was really amplified too much but we saw it and it got some play. In developer communities, the messaging on the containers and microservers as you mentioned earlier. Huge deal right now. They love that ability to have the containerization. We even heard containers driving down into the IaaS area, so with the network virtualization stuff going on, so how is that going to help developers? What confidence will you share to developers that you guys are backing the container standards-- >> Siddhartha: Absolutely. >> Driving that, participating in that. >> Well I think there are a couple of things. First of all, containers are not that easy in terms of when you have to orchestrate under the containers, you have to register these containers. Today the technology is for containers to be managed, the orchestration technology which is things like Swarm, Kubernetes, MISO, et cetera. They're changing very rapidly and then in order to use these technologies, you have to have a scheduler and things like that. So there's a stack of three or four, relatively recent technologies, changing at a relatively fast pace and that creates a very unstable stack for someone who create production level stuff for them, right? The docker container that they built actually run from this slightly shaky stack. >> Like Kubernetes or what not. >> Yeah yeah and so what we've done is we're saying, look, we're giving you container as a service so if you've already created docker containers, you can now bring those containers as is to the Oracle Public Cloud. You can take this application, these 20 containers and then from that point on we've taken care of putting the containers out, scaling the containers up, registering the containers, managing the containers for you, so you're just being able to use that environment as a developer. And if you want to use the PaaS, that's that IaaS. If you want to use the PaaS, then the PhP node, JavaSE capability that I told you was also containerized. You're just not exposed to docker there. Actually, I know he's got a question, but I want to just point out Juan Loaiza, who was on Monday, he pointed out the JSON aspect of the database was I thought was pretty compelling. From a developer's standpoing, JSON's very really popular with managing APIs. So having that in the database is really kind of a good thing so people should check out that interview. >> Very quickly, one of the historical norm for developers is you start with a data model and then you take various types of tools and you build code that operates against that development for that basic data model. And Oracle obviously has, that's a big part of what your business has historically been. As you move forward, as we start looking at big data and the enormous investment that businesses are making in trying to understand how to utilize that technology, it's not going as well as a lot folks might've thought it would in part because the developer community hasn't fully engaged how to generate value out of those basic stacks of technology. How is Oracle, who has obviously a leadership position in database and is now re-committing itself to some of these new big data technologies, how're you going to differentially, or do you anticipate differentially presenting that to developers so they can do more with big data-like technologies? >> They're a few things that we've done, wonderful question. First of all, just creating the Hadoop cluster, managing the Hadoop cluster, scaling out the Hadoop cluster requires a lot of effort. So we're giving you big data as a service where you don't have to worry about that underlying infrastructure. The next problem is how do you get data into the data lake, and the data has been generated at tremendous volume. You think about internet of things, you think about devices, et cetera. They're generating data at tremendous volume. We're giving you the ability to actually be able to use a streaming, Kafka, Sparc-based serviced to be able to bring data in or to use Oracle data intergration to be able to stream data in from, let's say, something happening on the Oracle database into your big data hub. So it's giving you very easy ways to get your data into the data hub and being able to do that with HDFS, with Hive, whichever target system you want to use. Then on top of that data, the next challenge is what do you visualize, right? I mean, you've got all this data together but a very small percentage is actually giving you insight. So how do you look at this and find that needle in the haystack? So for that we've given you the ability to do analytics with the BI Cloud service to get inside into the data where we're actually doing machine learning. And we're getting inside from the data and presenting those data sets to the most relevant to the most insightful by giving you some smart insights upfront and by giving you visualizations. So for example, you search for, in all these forms, what are the users says as they entered in the data. The best way to present that is by a tag cloud. So giving you visualization that makes sense, so you can do rich discovery and get rich insight from BI Cloud service and the data visualization cloud service. Lastly, if you have, let's say, five years of data on an air conditioner and the product manager's trying to get inside into that data saying, hey what should I fix so that that doesn't happen next time around. We're giving you the big data discovery cloud service where you don't have to set up that data lab, you don't have to set up the models, et cetera. You could just say replicate two billing rows, we'll replicate it in the cloud for you within our data store and you can start getting insight from it. >> So how are developers going to start using these tools 'cause it's clear that data scientists can use it, it's clear that people that have more of analytic's background can use it. How're developers going to start grabbing a lot of these capabilities, especially with machine learning and AI and some of the other things on the horizon? And how do you guys anticipate you're going to present this stuff to a developer community so that they can, again, start creating more value for the business? Is that something that's on the horizon? >> You know it's here, it's not on the horizon, it's here. We're helping developers, for example, build a microservice that wants to get data from a treadmill that one of the customers is running on, right? We're trying to get data from one of the customers on the treadmills. Well the developer now creates a microservice where the data from the treadmill has been ingested into a data lake. We've made it very easy for them to ingest into the data lake and then that microservice will be able to very easily access the data, expose only the portion of the data that's interesting. For example, the developer wants to create a very rich mobile app that presents the customer running with all the insight into the average daily calorie burn and what they're doing, et cetera. Now they can take that data, do analytics on it and very easily be able to present it in the mobile platform without having to work through all the plumbing of the data lake, of the ingestion, of the visualization, of the mobile piece, of the integration of the backend system. All of that is being provided so developers can really plug and play and have fun. >> Yeah, they want that fun. Building is the fun part, they want to have fun-- >> They want relevance, great tools and not have to worry about the infrastructure. >> John: They want distribution. They want their work to be showcased. >> Peter: That's what I mean about relevance, that's really about relevance. >> They want to work on the cool stuff and again-- >> And be relevant. >> Developers are starting to have what I call the nightclub effect. Coding is so much fun now, there's new stuff that comes out. They want to hack with the new codes. They want to play with some that fit the form factor with either a device or whatnot. >> Yeah and one other thing that we've done is, we've made the... All developers today are doing containers delivery because they need to release code really fast, right. It's no longer about months, it's about days or hours that they have to release. So we're giving a complete continuous delivery framework where people can leverage Git for their code depository, they can use Maven for continuous integration, they can use Puppet and Chef for stripping. The can manage the backlog of their task. They can do code reviews, et cetera, all done in the cloud for them. >> So lifestyles, hospitality. Taking care of developers, that's what you got to do. >> Exactly, that's a great analogy. You know all these things, they have to have these tools that they put together and what we're doing is we're saying, you don't have to worry about putting together those tools, just use them. But if you have some, you can plug in. >> Well we think, Wikibon and SiliconeANGLE, believe that there's going to be a tsunami of enterprise developers with the consumerization of IT, now meaning the Cloud, that you're going to see enterprise development, just a boom in development. You're going to see a lot more activity. Now I know it's different in development by it's not just pure Cloud need, it's some Legacy, but it's going to be a boom so we think you guys are very set up for that. Certainly with the products, so my final question for you Siddhartha is, what's your plans? I mean, sounds great. What're you going to do about it? Is there a venture happening? How're you guys going to develop this opportunity? What're you guys going to do? >> So the product sets are already there but we're evolving those products sets to a significant pace. So first of all, you can go to cloud.oracle.com/tryit and try these cloud services and build the applications on it, that's there. We've got a portal called developer.oracle.com where you can get resources on, for example, I'm a JavaScript developer. What's everything that Oracle's doing to help JavaScript developers? I'm a MySQL developer. what's everyone doing to help with that? So they've got that. Then starting at the beginning of next year, we're going to roll out a set of workshops that happen in many cities around the world where we go work with developers, hands on, and getting them inside an experience of how to build these rich, cloud-native, microservices-based applications. So those are some of the things and then our advocacy program. We already have the ACE Program, the ACE Directive Program. Working with that program to really make it a very vibrant, energetic ecosystem that is helping, building a sort of sample codes and building expert knowledge around how the Oracle environment can be used to build really cool microservices-based, cloud-native-- >> So you're investing, you're investing. >> Siddhartha: Oh absolutely. >> Any big events, you're just more little events, any big events, any developer events you guys going to do? >> So we'll be doing these workshops and we'll be sponsoring a bunch non-Oracle developer events and then we'll be launching a big developer event of our own. >> Great, so final question. What's in it for the developer? If I'm a developer, what's in it for me? Hey I love Oracle, thanks for spending the money and investing in this. What's in it for me? Why, why should I give you a look? >> Because you can do it faster with higher quality. So that microservices application that I was talking about, if you went to any other cloud and tried to build that microservices-based application that got data from the treadmill into a data lake using IoT and the analytics integration with backend applications, it would've taken you a lot longer. You can get going in the language of your choice using the database of your choice, using standards of your choice and have no lock-in. You can take your data out, you can take your code out whenever you want. So do it faster with openness. >> Siddhartha, thanks for sharing that developer update. We were talking about it yesterday. Our prayers were answered. (laughing) You came on The Cube. We were like, where is the developer action? I mean we see that JavaOne, we love Java, certainly JavaScript is awesome and a lot of good stuff going on. Thanks for sharing and congratulations on the investments and to continuing bringing developer goodness out there. >> Thank you, John. >> This The Cube, we're sharing that data with you and we're going to bring more signal from the noise here after this short break. You're watching The Cube. (electronic beat)