 Hi everybody, we're back, this is Dave Vellante and with Stu Miniman, and this is theCUBE. We're live at theCUBE, and we're talking cloud. Steve is a CUBE alum, he's VP of Cloud Solutions, and welcome back. Thank you very much. Good to see you. Glad to be back. So we were going to talk about cloud, but you told me just now that you're a Laker fan, and it's been a wonderful rivalry, Boston LA. You know, I grew up in Boston and had season tickets all throughout the 80s. So I'm a little older than you are, I don't know if you remember those days. I remember, well, you know, I was the bird magic era with Kareem and everything when it was an epic event. Did you read the book? I did read the book. Yeah, it was good, wasn't it? Yeah, it was a very good book, yeah. So I mean, it isn't the same today. It really isn't, those two changed basketball. It was just an epic event where you would race home from school. I was there when Henderson stole the ball, was there when Jack was saying, at Boston Gardens saying so what? But in the end, I have to hats off to the Lakers. They got the best of the Celtics, and the Celtics were a great franchise back then. Yeah, well, the tights turned a little this year. Yeah, so, well, Lakers, you know, right there with the Celtics, so the greatest team, greatest franchise in history. How many have they won? They've won 12? 12, or yeah, or something up there. And the Celtics are 13, so. Yeah, hey, mate, they might hang another banner in the garden. I thought the Celtics were going to win, what was it, 0-8? Yeah. And Ron Artest. Ron Artest. The guy didn't do anything the whole series. I thought he came alive, you must have been stoked. I don't know, you know, it's been two bad years now. I'm getting, you know, they've got a retool. You know, Kobe's not exactly a young chicken anymore at 33, 34, he's been in the league. He's been in the league 16 years. I know, he's a pretty amazing player. The thing is, you know, a lot of people don't like him, but he's got to give him a lot of credit. But I think his LA is such an attractive spot and you can get talent. Yeah, they've got to build it. I mean, he just can't do it himself as much as he wants to. 49 points a night just is going to do it. So anyway, let's go back to something else. We can talk about this while we're here. Back, you know, you're live with the SPN. Yeah, so yeah, it's more fun talking sports, isn't it? All right, so Cloud, so tell us what's going on at Discover with your whole Cloud play. Yeah, so, you know, in April, we announced HP's Cloud strategy, Converge Cloud, which is the industry's first hybrid approach and portfolio based on a common architecture. So, common architecture across private Cloud, managed Cloud, public Cloud, and let's not forget, traditional IT. A lot of people don't like to talk about traditional IT, but you know what, as long as you're not that old, we're not at all, but as long as we're on this planet, traditional IT is still going to be important. So where's the white space in Cloud? Where's the innovation that you're looking for, that you need to develop out either in R&D or through acquisitions? Well, you know, the interesting part of what we're doing is, when we looked at the strategy and we look at the architecture, HP has a tremendous portfolio, both breath and depth. If you look at the layers of the cake to build the architecture, and we've brought in HP, interestingly enough, we've brought in all of HP together, and if you heard MAG or you heard Donatello, you heard Betky, all the other executive committee members, there's three big bets at HP right now. Cloud, security, information optimization. When we looked at Cloud and we stepped back as an executive team, we said, my God, you know, we've really got some tremendous assets starting at the converged infrastructure layer, server storage and networking, management and security, tremendous number of assets, both from internally developed as well as acquisitions. Above that, information, autonomy, vertical, so unstructured, structured data, data, come on, that is the Cloud at the end of the day, how you use information, and then above that, how do you expose the experience to users? We're actually feeling pretty good about the assets, the intellectual property and the partners we're working with right now. Our job right now, I believe that customers believe the strategy is right based on the feedback we're getting. We have to execute now, that's our job. So what are customers doing with data in the Cloud? Are they there yet, are they starting to do data as a server, so they starting to monetize their data? They monetize the data, but you know, I was talking to somebody before, what's happening right now is that I think, it's the democratization of information and data. So if you look at big data in the Cloud, or data analytics in the Cloud, previously that was the field of the accessible to who? Fortune 500 companies that had to spend a gazillion dollars to gain access to heavy intensive number crunching and looking at structured unstructured data. What's happening now? You can actually access that type of capability in the credit and it goes down to, you can be a small medium business and gain the same capabilities as a large enterprise customer today. That is fundamentally a game changer for a lot of people and what you're going to see, I think, fundamentally is an explosion in innovation you've never seen before because the little guy has the capabilities of the big guy now. That has never existed before. Yeah, so now are you based in L.A. now or are you up? No, I'm up in the Bay Area. Okay, so you're in the heart of Silicon Valley, you see all this innovation going out, particularly around big data, you see amazing things happening in big data. So what excites you? What are you seeing that's interesting? Well, I think it's not so much, we've acquired autonomy and vertica and so forth and just what's going on out there is just the depth and the breadth of services that are being built on top of it, on top of big data, the harnessing of what you're going to do with it. And you like to look at it in two spheres of influence. One is what are you doing to protect yourself? So whether it be e-discovery, archiving, that type of round data, but more importantly, what are you doing to drive top-line growth? Revenue optimization, click-stream analysis, and the technology exists now to bring those two avenues to life almost in an integrated fashion, both from a structured, rows and columns and the nice need everybody delivers, but now all of this unstructured data and actually bringing it together to handle both of those dimensions, I'm excited about the whole thing. And actually bringing it to life both as an on-premise, but also exposing it as a cloud service. Steve, when we look at cloud, one of the things people had trouble with it, I think, is cloud to process. It's really not, it's changing the way I do think some, but it's not something tangible. And big data, a lot of people don't understand really the use cases. When we kind of looked at the big data space, the number one application that people use is custom. So we've been trying to collect some of the use cases and real customer interesting stories. I was wondering if you have any good anecdotes for us. For cloud in general? For cloud in general or, you know. Yeah, yeah, I mean, the predominant use case today for customers in a very, very large percentage of customers is DevTest. And interesting, so still, still, still, big, small, DevTest number one use case. Now the interesting part is, and you need to look at this, the cloud look, sports analogy. We love them. Not going to be a student body left. People are not, just like anything else in this industry, they are not going student body left. It is going to be a slow burn. People are going to take a pragmatic, strategic approach to what they want to do if they're smart. And most people are intelligent enough to realize that. But what this journey is going to be from the traditional IT to hybrid delivery, the best of all worlds and the converge cloud that we call it, it's going to be a journey. And that journey isn't necessarily going to be linear. And let me give you a good use case. So what we see developing more and more is, customers say, look, I need to have a much more efficient way to develop applications. I'm going to spin up an environment in the public cloud. Elastic, cost effective, I can do it quick and then I can just tear it down whenever. But you know what, I have regulatory performance, latency, whatever reasons, develop public, deploy private. And then interestingly enough, even with those security and privacy issues, they're going to go when they find themselves constrained in the private cloud, they're going to burst back to the public cloud for excess capacity. So somebody asked a question that's paying attention and says, well, Steve, you just said there were security and privacy issues, but what you do is because the application is somewhat composite, it's in chunks, you leave your sensitive data, your databases, your backend servers in the private cloud and you utilize the public cloud then for web servers and other things that need excess capacity on an ad hoc basis. That one is real interesting for a lot of customers today. Actually, the predominant use case we're seeing right now. Yeah, our surveys show that, whereas a year ago, that was not the predominant use case. It was like, eh, hybrid cloud, I'm not really sure now, it's just spiking through the roof. We fundamentally believe every customer will go to a hybrid model. How fast? We can guess. Yeah, in some form, you know. Right. Like you said, it's not student body left, but it's going to be a mix. Yeah, yeah. All right, cool. So what else is hot? Security. Security's big, you know, cloud or not cloud. You know, the interesting part is that security is becoming, it's becoming lesser of a concern. I mean, it's up here as a concern, but actually what we've seen over the last six, nine, 12 months is it used to be, you know, 80, 90% of CIOs would express security as a number one issue. The numbers are coming down. It's still up there, but it's coming down. The reason being is that some of these companies in the public cloud will spend an enormous amount of money and resources far beyond what most companies could spend to create a secure environment. Will it ever be, nothing's ever totally secure? But interestingly enough, there's so many resources being thrown at it that the comfort level is getting better. You know, I'm glad you said that. So we just did a survey in Wikibon and we said, what's your number one IT problem? Budget constraints came up number one. Data growth was number two. Data protection slash disaster recovery, business continuity was number three. Security was actually the middle of the pack and security was always top, right? Always, always, always. So to your point, I think people are becoming more comfortable with it. They realize that the benefits of cloud outweigh the risks, you know. You know what's bubbling to the top is there's a worry about complexity as you move to a hybrid environment because you can't leave your existing environment behind. So how do you manage the environment when it's on premise, off premise? And maintain the right level of service level agreements with your user base? That's a concern. So you could brute force it and just have homogeneity on your public and your private. Could. Not the greatest solution for all customers, right? But that's how you see some people trying to solve the problem. Some people doing it, but still the complexity of managing a single view and having that across. And the other one is there's, the cloud is, as you said Stuart, is less about the technology. Actually the technology is at the bottom of the ring. It's people and processes. So the lessons we've learned over the last year is the people that ignore the people and processes and rush forward usually have a big problem they have to back up. But a lot of times, and correct me if you think this is wrong, but a lot of times the technology influences the people and processes. So for example, a lot of customers use VMware for their private cloud. But a lot of the service providers don't want to use VMware. No. They want to use an alternative. They might want to use an open source system or whatever it is. And the processes that they're building up are different than what might be used in the private cloud. So you're absolutely right. The process is the key, the people in process. And there's diversity there. So that to me is the big challenge of the hybrid cloud. Well, it's interesting. So the traditional IT world is basically a hard wired silo, traditional IT. So you have infrastructure applications and information all hard wired. And it was done for a purpose. Because it was built for performance and security in silos, per application. It was never built to be agile, cost effective. What you're seeing evolve now, and this is really what struck a nerve with our customers and the why we've developed the strategy we did over the last 12 months, is that the evolving model for hybrid delivery where people want to exploit the different private managed public traditional is replicating the silo. Because each one of those models has different architectures, different management, different security, different development. So the reason why we developed the Converge Cloud was to create a common architecture, common management, common security, and the portability of the service across the properties. So we've taken that with our own intellectual property and we're exploiting OpenStack as the means to open that up from an open, from a, from a standpoint. You guys are committed to OpenStack. It's not just a marketing ploy. We didn't know it first, right? Because, hey, open source, rah, rah, rah, rah. And, well, let me ask you, is OpenStack ready for prime time? We believe so. We're utilizing it right now in our public cloud as an underlying set of foundational elements. And then as we evolve over the next 6, 12, 18 months with our architectural evolution and product adoption of the new technologies, OpenStack will be a foundational element in the entire converged infrastructure as a service layer. It'll provide the openness and the portability across multiple heterogeneous clouds. So you basically, your workload or your service can just travel. And you're not locked in? Yeah, so take an example of not locked in. Let me just test that premise. So, okay, cool, I'm cool with OpenStack, but I hate their object store. I don't hate Swift, but let's say I do. And I want to plug in, I don't know, Nervonix or something like that, whatever it is. I can do that in your, you'll help me do that. Well, OpenStack has the plug-in technology. So we're using it more as a framework and a set of open APIs than basically being wedded to any of the generic capabilities. So HP's going to bring its intellectual property and we're going to provide plugins so you get the advantages of the openness of OpenStack, but also the differentiated intellectual property that HP brings as long as our partners as well. Where do you sit in the organization? Are you in the enterprise group? I run, I'm responsible, I'm the VP of worldwide cloud for the enterprise group. Okay, so under Donatelli's organization. All right, great. So you're part of a product and support services group, not the professional services group. We have one element of that. We have the technology services, essentially the professional services coupled to the products. So as we go out and help customers build clouds, whether it be private or public, we'll bring the enterprise group products and our technology services to deploy that. Then on the other side of the house, you have enterprise services, which is delivers consumable cloud services as a service from HP. All right, Steve Deitch, amazing as always. I just love the conversations we have with you. I love the energy and the vision. More Lakers. It's a, well, you know, we'll see. You know, I mean, it's been an interesting run. I mean, the big three is getting old on our end, so I mean, I'm happy they're still in it. You know, it's 2-2, we're going to gain tonight. It's got all the best to them. So yeah, good luck. Thank you very much, guys. Thanks, great to see you. All right, keep it right there. We'll be back with more sports talk. This is theCUBE, we're live from HP Discover. 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