 Okay, we're back here, live at EMC World. This is SiliconANGLE's exclusive coverage of EMC World 2013. This is theCUBE, our flagship program. We go out to the events, extract the signal from the noise. All the news here has been all about software-defined storage, software-defined data center, flash, fast data, big data, abstracting away the complexities and business value or transformation. I'm John Furrier, the founder of SiliconANGLE.com, and I'm joined with my co-host. Hi, everybody, I'm Dave Vellante at Wikibon.org. Praveen Akharaju is here. He's the CEO of VCE, two-time, at least, cube guest. We had you on Praveen at VMworld last year. Thanks for coming back on. Yeah, absolutely a pleasure to be here. Yeah, good to see you. So it's almost a year in for you. So tell me, what did you learn, surprises, the good, the bad? How have you applied what you learned? Give us your take. You know, I think it's been an amazing ride. When I kind of came into this, we were looking at this as primarily a solution for us to help accelerate deployment of Cisco and EMC technologies. But what I found was, given the tremendous amount of change that we have going on, I mean, these announcements this week, at OpenStack, every week you have something new going on in the technology space, huge amount of disruption. A lot of our customers are dealing with tremendous amount of complexity. And the real value proposition that VCE was able to bring to the table was a fundamental simplification of a core piece of the data center infrastructure, right? And we've been able to do that now systematically over 600 customers. And that value proposition is something that resonated tremendously. The biggest surprise for me was the level of customer loyalty we had. You know, I've worked with customers in the enterprise and commercial service part of space. I got to tell you, this set of customers that VCE has are absolutely the most loyal. And it's a testimony to the team's tremendous, you know, performance and focus on customer experience, right? We've been following VCE for a while. One thing we have noticed is the customer loyalty, but they're big names. So it's not like small little proof of concepts. You have big customers in complicated production environments, right? So let's roll back the clock a couple of years. Tell us what's going on now vis-a-vis what was going on just two years ago. I mean, you know, obviously virtualizing SAP is one element of it. It always scales into other use cases. What is the current state of these customer deployments? What's growing? What kind is not growing? What have you guys learned? What are you doubling down on? You know, the initial stages, most of the VCE, you know, we blocked deployments were around, you know, specific sort of use cases, specific applications that a business unit might have within a company, right? They said, all right, you know, we need to get this thing up and running quickly, find, prove yourself that you can actually do this in the time you're saying in 30 to 45 days, and we'll give you a go, right? So a lot of the deployments we initially had was a specific application use case. What we're seeing now is a fundamental change in the use case. And we've broadened our customer set. We started off primarily with large enterprises, Fortune 500. But now we're getting a lot of traction with service providers, systems integrators, as well as, you know, going down the chain into the medium and the small businesses as well with the launch of new products, which I'll talk about in a little bit. But from a use case perspective, we've gone from focusing, delivering specific applications to being a core part of data center consolidation projects, you know, application replatforming, right? You know, cloud deployments, if you look at it from a service provider perspective. So, you know, we're now accepted as a fundamental way to develop the next generation data center. Go ahead, sorry. Now I was going to say, so in support of that basic inflection we saw in February, we basically had our biggest type of product launch, where we basically expanded double the size of our product portfolio. You know, at the high end, we doubled the performance and introduced two new Vblock systems, the 100 and the 200, which allowed us to go after emerging markets, small and medium businesses, as well as, you know, expanding the footprint for large enterprises. We've created unique intellectual property in terms of software. And the notion there was, you take this notion of simplicity of the infrastructure to the operational level. So that was vision intelligent operations. And then we introduced our first specialized system, where we're now talking about how do you accelerate the deployment of applications in the data center. SAP HANA being the first instance of that. Well, that IP move is big for you guys. Absolutely. Culturally, you sort of become more than just a sort of reseller of others' equipment, right? Yeah, we think of ourselves as a solutions company, right? And we're in the business of basically facilitating that journey towards that next generation data center cloud. Proving, you know, you guys have an interesting product. It's at the high end. It's an executive cell. It's a C-level kind of cell. And we've talked to a lot of CIOs over the past six months. Dave and I are trying to understand the hyperscale, sort of a defined data center, and all those kind of nuances. And one thing we've noticed is that they're really attracted to this shiny new toy. You know, hey, this is an open stack, HANA, you know, all these things are out there to get their attention. So they get all excited and intoxicated by this new trend, so big data, among other things. And they're legitimate trends. But when it comes down to it's like, oh, they go back to the ranch and they're like, okay, how do we deploy this? So, you got a dynamic of a market that's pretty active in terms of new capabilities, transformations, we're seeing the marketing here. But one thing that comes back down to is all the CIOs is the ones that are doing the best projects are about time to value. Can you share with the perspective of how fast you can get to showing the customers the value? Like is it weeks, is it days, is it months? I mean, what are some of the recent data points you can share on that? Yeah, no, it's a great question. And I think at the end of the day, rubber hits the road, there's an ROI, and there's an investment case that the CIO needs to make. So, we think of this in kinds of a couple of buckets. The first, obviously, is what we call time to business, which is the amount of time it takes for the customer to stand up the new infrastructure. And this is material in a lot of ways. Now, if you take a look at something like a visa, they wanted to get the mobile applications into production rapidly. It was a competitive imperative for them. And we were able to get that thing up and running in a couple of months as opposed to the six months plus timeframe that they had originally planned for. So, their plan was what, six months? Six months plus, right? I mean, six to nine months, basically, depending on the current, their infrastructure they had. So, we were able to compress that whole cycle into basically under two months. So, that was material because it allowed them to get into the competitive market space rapidly, right? That's one example where this real definitive business value to the 30 to 45 day process that we drive. The second key area is in terms of cost savings. I mean, I have at least three examples of Purdue Pharma as a good one, where the CTO there is essentially committed to the CFO a schedule of budget cuts that he would basically sign up for and he used the V-block as a way to get him to that point. And the way we were able to do that is basically we provided virtualization. We simplified his operational costs because as a pre-engineered system, we provide upgrade and support capability afterward. So, he was able to dramatically reduce the cost of operations as well as the cost of his infrastructure and meet his commitments to a CTO. And we have him in a quarter, in fact, one of the videos in the launch, he articulated that, right? And the third bucket we look at is performance, right? And this is something that obviously is at the heart of what an engineering team, for example, looks at. The way the applications run our infrastructure, we do a lot of engineering back-end work which essentially allows us to provide very specific guidance in terms of tuning of performance parameters. And that enables, in case of a bank in Australia, they basically told us, look, we recovered the cost of the V-block within six months because of the performance gains and optimizations that they saw which allowed them to decrease the amount of software licenses they had to procure, right? So that's another example of how we provide value. So when you kind of look at it. So let me dig in on that, because one of the things that's come up, we were just on day one here at EMC World, we interviewed the CEO of a company called Service Mesh. And he made, and I know they're kind of in this orchestration layer, but they're in the same kind of area that you guys are playing in. He said, we saved a customer over a hundred million dollars. And I'm like, okay, come on, he was firm. No, we have proof points. Can you give any color to order of magnitude kind of cost savings you guys are seeing with VC? Absolutely. So depending on the customer use case, we've seen anywhere from two to three X cost savings. So this is basically comparing a V-block based deployment versus a traditional deployment or a competitor's deployment, right? And the cost savings there is inclusive of the operational costs, the efficiency costs in terms of time to value, right? As well as we, from a pricing perspective, right? Where the way we configure things we're more optimized, right? Virtualization is a huge game changer for us. UCS by far is the highest performance and the best architecture from a service perspective which gives us huge amount of advantages in that area. So I would say two to three X is kind of what we've seen as an average. Of those three variables, time savings, cost savings and performance, which ones do you say that you can slam dunk, no problem, you know of any issues in terms of people understanding them and which ones do you see are the ones that you think people don't really understand or need to understand about? I mean, is it the time savings piece or is it the cost savings or is there one that you could dial up and say, you know, amplify more? You know, one of the things we, obviously when you talk about cost savings, I mean, as you said, right? There's always a question mark out, really. I mean, can you actually do two to three X cost savings? So, you know, we've talked about it. There's skeptics in that area. I mean, even if it's a legit cost savings, I mean, what are you, it's a number game and show me real numbers. Yeah, fairly so. And I cut my teeth, you know, in the service part of space, right? I sold a lot of telcos and trust me, I mean, you talk about cost savings. I mean, they really have a very rigorous process. They have explicit negotiators. So what we do basically is we have a TCO tool, right? So we provide the TCO tool to the customer for them to input their parameters and then we're able to, in their own use case, we're able to demonstrate the kind of savings and then we back that up when we actually deliver it. So a lot of times I think the cost savings aspect of it is, you know, it could be a, you know, just a marketing number I could throw out two to three X. It really is, there's a method behind the madness in how we deliver it. I mean, we've now ironed out the time to value, time to business, 30 to 45 days. We've done that consistently over 600 customers. You know, we have customers like Skyscape, for example, who bet their business on the fact that we can deliver in 30 to 45 days, right? They're a startup. They provide cloud services to the UK government, right? And the chairman was there, I was meeting with him yesterday, he said, Praveen, I'm depending on you guys to deliver this thing in 30 to 45 days, right? My whole business plan depends on me executing that fast. They're fundamentally changing the agility of services that they're able to provide. So I think, you know, a lot of times this is the reason why we have the loyalty, right? You know, it's a complex sale because converged infrastructure is about bringing things together. Well, can I put it together myself? You know, somebody else has a similar value proposition, but once the customer comes on board, we are able to back up our claims and that's why we have that 65% loyalty, right? Praveen, I feel like we're entering the third phase here of this whole converged infrastructure. So 2009, 2010 was kind of early adopters, you have to prove it to me. 2010, early 11 or 12 even was, okay, we're gathering proof points, we're gaining validation. And now we're entering sort of the third phase, which I don't know what you call it, maybe it's the exploitation phase. So what are the things that, first of all, do you buy that sort of phases? And what are the things that you all need to do to take advantage of that next phase? So you're absolutely right. I mean, I think, you know, we feel like we are spending less time convincing customers that converged infrastructure is a viable way for them to build their data centers. You know, we're having lesser conversations about, you know, we can do it ourselves better, it's cheaper, et cetera, right? Most CIOs even down into the ranks are now understand the value of converged infrastructure. So the next step here really is about, you know, what our customer is talking to us about is to say, great, you know, I'm building a brand new data center, I'm in sourcing, bringing it back, consolidating data centers. We're doing it on the wee block, right? Now what else can you guys do for us in terms of taking this notion of simplification, right? Can you train my folks to operate in a converged infrastructure environment? Because one of the things we don't talk about is, you know, the talent needs to evolve, right? To be able to deal with all this capabilities. And in a lot of IT shops, I mean, you don't have uniform availability of talent that understands everything that's going on, right? So we need to do a better job of trying to give our customers the support system to then start getting the maximum benefit out of the converged infrastructure. And then as we say, and we're doing that by both enabling training, right? Having on-site residents who really help train the customer's engineers, but also trying to bring in a lot of the application infrastructure into the factory. So the thing that we see does the best is, we do things that normally other customers or our partners or, you know, competitors would do in the customer's floor, in the factory, right? So more we can bring into the factory, more we can deliver the simplification. So I think that's where we're headed. You know, simplifying operations, simplifying the application onboarding onto the convergent infrastructure. And as part of that application onboarding, how much of that is bringing sort of knowledge about those applications into the system at the factory? Yeah, you know, I think, you know, our goal's not to be the application experts, right? I mean, we will not be the SAP experts or the Oracle experts. But I think what we can be is to essentially make sure that the infrastructure is optimized for a HANA system. Infrastructure is optimized for an ERP system, right? It's optimized for a SharePoint or an Exchange. So those are the things that we focus on. We can build in the application performance management tools. So the customer can then, you know, once they get the VBlog, they can use those tools to better optimize their performance and deliver them. So we're in the business of delivering the infrastructure that supports and facilitates easy application onboarding. You know, our goal is not to try and be the application experts. All right, Praveen, we got in the hook. Well, give me the last word, any final thoughts that you want to share with us? No, for us, you know, 2013 is an exciting year. You know, there's a lot going on in the market space. We feel like we have a lead in the market. You know, we're fortunate to have EMC and Cisco and VMware supporting us. And I think our customers are our best advocates. So really excited about where we're headed and, you know, look forward to catching up with you guys next time. Excellent, well, Praveen, thanks very much for coming on theCUBE and really appreciate your time. Keep it right there, everybody. This is theCUBE, Silicon Angles Production from EMC World, we're live in Las Vegas. Day three, we'll be right back with our next guest right after this.