 Why are we talking about software the world's changing the world's changing, you know, and I probably would be misguided to sit here and say I'm gonna tell you guys that you know the infusion of digital intelligence is big news everybody knows that probably The real point here to make on this discussion is is the variety in which digital intelligence is Infusing our society, you know, everybody does know What's going on with the mobile in the handheld space? But then if you go and you talk about what's going on in the enterprises, you know And then you start talking to some of the people that I talked to about running all these power plants and power grids And they got sensors all over the place and and each one of these power companies generates more data in a day than they Had in the previous 50 years or if you talk to other segments of the population about What's going on in medical and in the amount of medical information that's being generated every day and that all has to be handled that's really what leads into the discussion of Why open and Linux and open source is so important to us If any one company even one to scale or the size of IBM is Pretending to handle all of this data Generate and solve all of these problems. You're nuts and they could have happened You need to invoke the entire open source community You need to invoke everybody to go and solve these problems and that and then integrate them And that's what you know the speed and integration is about of course There's the choice point as well that that people don't want vendor lock and people don't want to be tied to one spot And that's a real important point also But definitely the ability to get the right amount of innovation and make things happen is Is really the core of the discussion of why a Linux and open software are so important IBM has a has a long history as well and participating with this crowd we've been talking about a little bit and and over dinner last night and I've been looking up looking things up a little bit. We started in 2000 and with our first effort and it was really led by a gentleman by the name of Irving Wadowski Burger and In my preparation for Coming here to talk to you. I started looking up and reading up on the start of IBM's first investment in Linux, you know, we made a You know, roughly a billion dollar investment in the year 2000 To to start our Linux effort and I was reading up on it What it went we're Irving Wadowski Burger did when he first started he wrote a whole article in 2006 About the start of that and I wanted to read a little bit of what Irving had to say I thought it was real important and and I kind of wish I was gonna say it but Irving got called by Sam Palmosano after spending four years starting leading at IBM's network division and We announced in 2000 a strong commitment to Linux and it didn't go so well It was mixed met with a pretty mixed reaction and so Irving spent a year Evangelizing in the year 2000 and here's what he said he did during that year in the year 2000 evangelizing on February 3rd I gave the keynote presentation at the Linux World Conference in New York Saying we did not view Linux as just another OS any more than we viewed The internet is just another network We viewed Linux very much as part of the evolution towards open standards to help integrate systems Applications and info over the internet Linux was and continues to be the only popular operating system that runs every single platform Regardless of vendor a property it shares with just about all major software associated with the internet so Irving said that in 2000 It's very very true today. I could you know if I were just to say that today I think everybody would agree when he said that in 2000 and That was the start of IBM's commitment to Linux and I think what he said is very true Linux is not just another OS any more than the internet is just another network. It is a way to develop It's a way to do things that couldn't be done otherwise and it's very important. Oh Couple other points on this One of the other things you can notice about this timeline of IBM's commitment to open source. It's accelerating If you look right there, we got it in the past two years We've we've committed to four or five different open source projects including, you know Helping form the open daylight consortium and I want to talk to you a little bit about the open power consortium That's an effort that I've been leading at spending a lot of time on here of late and we're pretty pretty excited about that The open power consortium is very powerful that in that it's taking a lot of the principles that I just Talked about Irving talked about around open software and we're moving them into hardware to make it more pervasive more innovative and more things to happen What we're doing is we're taking our our chip IP the power chip IP That powers all of our big IBM systems and we're we're making that open and available for people to innovate with to drive more innovation in the industry You can see the partners that we're launching this with this is the initial core set of partners One of the things that you we learned from that previous page of launching many of these open source Consortiums is if you get too many people in the bed all at once to try and launch an open Dot org it you don't get a lot of consensus right away So we're we kept it to a smaller group and then we'll grow to a bigger group later But that the need that we're trying to fill is is that you know today You know if you look at what's going on with a lot of the big web 2.0's and many companies in general There's a lot of innovation taking place You know at the system level hooking together different IO sources different network sources and such together at the system level But as technology continues to shrink and integrate more and more of that innovation is taking place at the chip level And now this is going to allow that innovation to continue on at the chip level We give people choice in the manufacturing people choice and design and we're going to help them do it It's a pretty exciting change in the industry Likewise, you know, we are creating choice then we also you know just like in with the Open-source software the choice is just as important as is the innovation in technology To go with this. We're creating the first open source Software stack including firmware to be accompanying the chip design So now we'll have a full open-source firmware stack OS hypervisor management stack all available with a consistent set of hardware and Then that should enable people to be able to do an open innovation Around chip design as well as system design. We expect this to have a very big impact So moving forward What why is why is IBM? attacking Linux and moving the Linux so hard as well as Innovating across this whole stack and it's really there's two reasons one is Both of them are the important ingredients to a successful adventure One is is that just this past year? I don't know if everybody knows this But Linux did surpass the size of the Unix market in this past year The Linux now market now is bigger than the Unix market. So there is a much bigger business opportunity The Unix market is relatively flat We continue to take share in it, but it is not a growing market The Linux market is growing much much faster, but the second thing is there is also a technical need which is Most of the Linux x86 market is serviced by commodity hardware That is not designed from the ground up to be attacked by servers our systems are designed from the ground up to be server quality Systems largest caches in the industry largest Mount of threads per die in the industry etc etc etc We have server targeted designs from the ground up as as the big data in this explosion of applications and explosion of things takes place in the industry We believe that the power system hardware on the Linux open software stack is going to be the solution to make make things happen and As you can see here We got no KVM Linux the whole open software stack upon which we can build the applications that the industry needs you know and the the flagship right now of our Linux Application IBM's developing is Watson if you get in front of a keynote conference like this And I don't say Watson at least once I get in trouble. So we're gonna talk about Watson a little bit Watson you know right now is Most famous I think most you know for playing and winning at the Jeopardy My mom found it to be a very important point for 20 years I've been building microprocessors and IBM and I call her up and say hey mom I just built power six the highest frequency microprocessor in the world and she go that's nice Then I'd say hey mom, you know called up and said Watson I think there's a one on Jeopardy we built the brain for it. She goes. That's great. Can you send me one and You know It's funny. I told that story to Jenny when she visited IBM Austin and And that actually made her first all hands meeting that the importance of Watson was now that everybody's mother understood what we did So it's good stuff But but we're moving now Watson into more than just the game show market We've conquered the game show market with an unblemished record and and they could see the first task that we're taking on that's worthy of ops Watson skills and capabilities is Is the curing treatment of cancer and No, we got a set up with a memorial Sloan Kettering and well point where you know doctors you know can put in the patient's symptoms, you know describe it all to it and the Watson feeds back an analysis of These kind of treatments are what you need to do to treat a patient with these systems But what's really cool is is it's also interactive in real time You know patients it's down across from the doctor and then it comes out No, I got a little blood in my flim, you know And and then they type that in and then a new treatment comes back and it's it's a very very powerful tool And it's a very exciting thing that we think it's really going to improve the cure and treatment of cancer You know right now there's statistics like you know like one and one and five patients know isn't getting top-level Treatment for cancer and this so hopefully in a level that playing field as it becomes more and more pervasive We also have other applications for Watson that is built on the the Linux and the Apache stack Which is also the the call center business? We have some of the largest call centers in the world are using Watson like technology to improve the level of service there My laptop just broke a couple weeks ago So I'm all for you know buffing that industry up a little bit We could go a little better there, and we hope Watson will be able to do that also Got a few more examples of various Applications around Linux on power that we're going on just for just for you guys and see you know the top two are you know taking Linux applications and really applying them and leveraging know some of power's core strengths of performance and scalability the bottom left one is is a small business that's growing really rapidly and They just needed security and a good database to hold a customer secure data and good performance and That little car company in the Netherlands is using power Linux for that bottom right is you know a classic consolidation play Which is you know what really has fueled the power business for IBM for the longest time You know IT informatic recently consolidated onto a power Linux platform and got you know about half the course half the IT operational cost With that consolidation play, but all of the things that we've done with power We are now doing as well on the power Linux platform. That's what we're doing with these Examples here So so IBM is is very very heavily invested in the success of Linux You know every one of our systems just as Irving said you know 13 years ago every system we got runs Linux and we got 400 plus software products That's a from our software group that are all Running on Linux as well and as well as we've you know given a whole lot of patents to help with the protection and the legal issues around Linux and as well as we have lots of people developing at 600 plus because we're continuing to move more and more Developers to the Linux platform every day So so then we go on you know Jim alluded to That that we had an announcement to make and so then you we were announcing today as well That we know we're gonna donate donate We're gonna invest a billion dollars How may we'll donate you know well Well Dan Dan fries in the back in a room And I think he brought his checkbook so everybody in the room gets their share of a billion dollars here That was Dan fry See there you go see even the hardware a guy can make the software a guy's happy. That's good. Give him a billion dollars Okay, so we got that equation solved so so power systems is we are investing a billion dollars around power systems and Linux and It's it's coming out in many many forms. We're shifting more and more development to to power Linux as well as We're creating some development centers. We've created three or four of them around the country. We're announcing the opening of one more Linux power adult development center in Montpellier, France If any of you guys haven't been to Montpellier, France, it's a good place to go I would suggest if you want to work on your Linux apps on power go there good spot very nice And also We're also creating a Linux developer cloud. We'll give people very very quick access to hardware So they can do development on power, which is extremely important to the effectiveness of Getting more and more people in this open-source environment innovating on power So this is an important piece of what we're doing with this money will be spent over the next four to five years with our development teams and with Our partners and ISVs as well And you know the first investment we made you know back in 2000 had a tremendous impact on Linux in the industry and we believe that this investment as well is going to have a strong impact also a Few other things that I wanted to share with you is as we're doing a little bit of a promotional here a Little contest to see what the next best power app to put on Linux on power Now the cool thing about this was is I was going to say you know Hey, everybody could come up here to the screen right now and and click on that thing You know says clicked it right, but they tested it beforehand. It works all the way to about the back of the room so from your seat you can click on that and get to this website and and You know put your idea in for the next big app and you get a chance to win an iPad Let's do some fun stuff come out of this and see what great new apps can come up And we'll be working on some of those ideas with the power development team finally We got a little booth Here set up and we got the Watson Jeopardy challenge at the booth, you know, that's kind of fun I've done that myself go and take on Watson see if you can answer a few more questions than they can and See I think that's everything on that never I talked about so I really appreciate your all's attention Appreciate your time appreciate the invitation to be here and thank you very much