 Live from Silicon Valley, it's theCUBE. Covering Mobile World Congress 2017, brought to you by Intel. Okay, welcome back everyone here live in Palo Alto, California, the Silicon Valley, Silicon Angle Studio for the Silicon Valley coverage of Mobile World Congress 2017. I'm Jefferyn theCUBE. We're here with CUBE alumni and one of our favorite guests, Allen Cohns, the Chief Commercial Officer, a Lumio hot security startup. Coming in to share his commentary on Mobile World Congress. Allen's a veteran in the industry, great to have you. Been in the Silicon Valley Friday show a few weeks ago. Great to see you. Thrilled to be back, beautiful environment. You need a party. It was great to see you on the Silicon Valley Friday show because after our segment, the New York Times ran that story Friedman had that the crux of it. They took our content. We're going to Breitbart next. Exactly. And great, great content was serving it up. So I want to say thank you. It was great coverage. Thanks to the New York Times for picking up our content. We'll take it to the next level. Always great to have a conversation. You got a good way to put the finger on the pulse. Mobile World Congress. Two days of coverage for us. I'll just give you a quick reader's digest summary of what we're seeing. It's a bipolar show. It's a device show and a telco trying to figure things out show. And then the middle is a lot of money to be had by whoever can help sort out the counseling of the telco business. Intel certainly is a big player in that with 5G and a lot of under the covers stuff. SDN, NFV, new networks and new paradigms of how to configure these architectures. Not much mention of security but that's essentially what's going on. You got your, everyone's writing about the devices, the new LG though. Yahweh, you know, all the stuff's going on. And then you get the telcos. Well, you know, speeds and feeds and build out and business models. Right. So what's your assessment? All right. So I've been to the Mobile World Congress 10 times. We never talked about this but I actually worked the cellular carrier in the 90s. And you know, I mean, to me, the show is the same every year. It's drones, clones and phones. Right. That's what people really focus on, right? And like, so the 11,000 versions of the Android phone even though Apple's still taking 89% of the profit at the industry. So there's only really one phone you have to pay attention to on one side. And then the kind of like more bits, less money side of being on the carrier, right? What is being an ISP wireless ISP or a wired ISP is like, every year I give you more bits and I make less money. I'm gonna make it up in volume and I keep pouring all this capital into this. So you know, to me, they really haven't yet completely broken out of that paradigm. Now, the key thing is that the mobile network is the primary network, right? So all the profitability in telco is in the mobile network. Like nobody says, hey, I'm gonna get up and build a wired network and build some more copper to your house, right? So that is the principle way that people are using it. And we have now an entire generation that don't know you can actually plug a phone into a wall or an ethernet connection. So I think that's the kind of competitive dynamics that people go with, but- And that's under pressure though because now we're, you know, the carrier is always in the operating, always controlled the relationship to the user via the contract. Well, in relation to you buying an iPhone lately, there's no more relationship. You just buy whatever device you want. Well, the end of the subsidy ended the, I'm not talking about subsidy, I'm talking about like I have a contract with AT&T, I can certainly change it to Verizon, so I can certainly swap. But for the most part, the carrier views me as a subscriber. Right. Pretty much that's it. They bill me. I'm really not getting anything extra from AT&T. Maybe I get some hotspots. Right. But I mean, come on. I mean, there's what value- You're just our poo. Where do they go from here? And we had the guys from Data Turn On who had interesting proposition is they have a ton of data. So there really has been this struggle institutionally, as you know. Core competency has been provisioning, truck roll and billing. Billing. So that's, what else can they do? What's your thoughts of, okay, let's here's an exercise. We get elected to be the CEO of the biggest telco. You have Verizon on AT&T. We own the telcos. What do we do? So we fire everybody? Do we do what Donald Trump does and just fire everyone and run it the way we want to run it? Or do we, how do we build it? I mean, what will we do? Seriously, what would we do if we were telcos? We want to put our business model hat on. So I mean, I think you have to kind of deconstruct the value chain of that. So what a telcos do is they offer up content for the most part. You know, these devices, I have to teach my kids that you can make a call with it. But aside from a call, what mostly what people do is use some form of internet application. They don't get any other money for the internet application. They don't get any money for hosting it. They don't get any money for managing it. They don't get very much money for making it perform. So to me, the biggest challenge to the telcos is actually Amazon. Because if you think about it, Amazon is now becoming the supply chain for so much internet-delivered content. And if the telco wants to be something other than the last mile and the wire is connecting that last mile up, by the way, it takes a lot of wires to build a wireless network. People forget that. They're going to have to start to figure out, you know, can I, can I, you know, whether it's caching, data center, can I turn profitable services to the people who are all competing at the edge of that universe and applications? I don't think they really have done that. I mean, there's some of the largest data center operators in the world, but they haven't really thought it through. I was at a studio in LA a couple of weeks ago, and it's one of the large national studios since the Lumio customer, and they've now moved all their content distribution into Amazon. So they don't send the content from their network to the affiliates. They put it in Amazon and Amazon delivers it. How much longer is it gonna be performable than actually the studio works out of Amazon? Yeah, I mean, the head ends dead. I mean, this cable, you know, is kind of changing. That's the media piece, but also you have all these new use cases, the fantasy of autonomous driving cars, which, you know, you could say it's a data center on wheels. Yes, I could buy that. Is it gonna be uploading data every half mile? I mean, where's the wire? So then you have this new construction, smart cities, it's another one, smart homes to see Echo in there. I mean, I look, I made my living out of making data centers more secure, but the data center is gonna completely evolve. The share profusion of data that's gonna come out of these devices, and a lot of people have talked about the edge architecture, is gonna blow up the idea of backhauling it to a centralized server process it in a bunch of ways and spit it back out. You know, for me, if I wanted to write a smart or autonomous car management system, let's say I was the city of Palo Alto, and I'm responsible for now, instead of the traffic lights, I'm now also responsible for how autonomous cars go through Palo Alto. I'm not sending things back to some data center in Northern Atlanta, you know, in Virginia for Amazon. I'm gonna have to figure out how to process all that data closest to where those cars are make intelligence decisions about them, all that local, and then kind of send back out instructions. So what I think you're gonna do is you're gonna see a shift from the central model to a much more distributed model, and I'm gonna have to have like many data centers. So instead of having 10 mega data centers, I might have a thousand mini mega data centers that's gonna make all of these things happen. And I don't think a lot of people have kind of paid attention to that architectural shift. If you're in the process of business of selling servers or networks, you're still thinking client server backhaul it into the giant data center with, you know, next to the nuclear power plant, but it's all gonna have to move a lot closer to where, it's something, because like, I don't care about that decision right now with the 50 cars coming down Middlefield. And the streets that feed into it. But there's a bigger architecture thing that Mobile World Congress is trying to point at, which is an ecosystem. I mean, let me take a step back. Is Mobile Congress a relevant show, or is it becoming a CES side show, biz dev show? I mean, Sargalite was on yesterday saying, look, it's where everyone goes to who's who goes there. It's essentially a biz dev show that happens to have a trade show running. Well, I mean, you know, look, it's like, it's the agor, right? You know, the Greek term for marketplace. Like you go there to do business with people. And if they happen to be, it's like RSA. Two weeks ago, you guys were up at RSA. It's like, is it really fun to walk through 1400 vendor boots or is it like everybody who makes decisions on buying and selling security stuff happened to be in the same, you know, two square miles of San Francisco. So I don't think that part goes away, but I do think increasing- It's a super important part. Yeah, but I think the architecture of who plays is going to change, right? So the question you gotta ask is, who's gonna be the Amazon of the mobile world and disrupt the network model, right? And the network, you know, the network is now just something glued together with software. I mean, like, you know, I mean, the years ago they had this thing, it didn't really work out. It was called the cloud, where I would rent my access point in London to people and I'd use their wifi and, you know, the stuff that glues it together is always much more important than the infrastructure itself. And so if mobile world Congress is gonna be important, there's gonna be a track on the people who actually kind of glue all of that stuff together. All right, so I gotta get your take on the business conversations you just mentioned. This marketplace, everyone's there. What are some of the conversations that you could imagine that was happening at Mobile World Congress? Just, I know we're not there. I mean, we've been hearing some of the hallway conversations, obviously 5G is the big story. What are some of the marketplace hallway conversations or business meetings that are going on in your mind's eye? If you had to make a guess on what's happening. Well, so what are the most important content that people like to use today? Pop quiz, you know this? Yeah, video. Video, right? So to me, what were the conversations Netflix was having and Amazon Prime was having, right? Because they're not just waiting for you to be in your TV to consume there, right? People are consuming increasing amounts of video content on mobile devices. So I think there's the Hollywood influence, right? Or the studio, or was it the National Association or programming exec, isn't that B, right? How do they, because what you're doing is if you're a content producer, you're looking for eyeballs and people to pay for it. And there's nothing more ubiquitous than that piece of class we're all carrying in front of our nose, 17 hours a day. So I think that's a big set of business discussions. Your prior guess I think was talking about this is like, okay, is there just a dramatically different way to build this network, right? Because so 5G is going to give you the promise that more is law at work, the physics are, I'm getting a lot more bandwidth. What am I gonna do with it? Well, people are gonna fill it up. And then- And there's different use cases. There's also mobility. And then high bandwidth, dense areas. Right. And then things that are moving at 100 miles an hour, 50 miles an hour, I mean, planes, trains. Yeah, I mean, it just, so I think there's an element of that. I think there's the internet of things discussion, which I still think five years, it's like the internet of whatever things, right? I call it the IOWT, right? Because it's like nobody's, it's not really back connecting your light bulb to the network, but there are a lot of kind of things in motion that people want to better manage. Well, we just introduced our research agenda this morning with Peter Burris. We ducked out IOT, IOTP. Right. People, internet of things and people. So have you gone back to the Fourier family and count up how many IP addresses you have as a family? No one family has 111 IP addresses. IPv6 for you. Yeah. Yeah, I mean, we need a gateway man for that Netgear router that comes into the house, but that is actually it. We just bought the new Google access points, the ones that have that little mesh. You need to get messed in here, but yes, I'm just kidding you. Yeah, no, I mean, but you know, that's, I mean, so there are a lot of things. The other thing is that there's the interaction of the mobile network and actually, I think Google's a great example. So if you think about it, Google produces the Wi-Fi at Starbucks and a lot of retail. Now, they're interesting on what's going on. So today we think about the mobile network as a mobile network and we think about the broadband fix network as a different network and like the interplay between those two. It's like, you know, there's a lot more than four square, right? And then, in face of the trick. Well certainly, Fiber to the home is very capital intensive. We know what it costs to do a truck roll to trench and to connect to the home with a NID. Overlay of wireless, fixed wireless, that would be fantastic there. Well, so you have the overlay and then what, when I know that you're coming by, right? Because the fix network is now actually a Wi-Fi network. Right, I mean, it has wires. So you have the mobile network, you have the Wi-Fi network and you have people kind of moving in and out of those environments. And I think there's, I'm seeing a lot of companies getting funded. People are actually trying to say, how do we monetize that experience? So this is obviously four square and those other location guys started years ago. I mean, look at something like Waze. Right, Waze went from a GPS app with social interaction to a car sharing, ride sharing going after Uber, right? Just Google company. Well, we had NTDocomo, VC, Christina Koo talk about mapping as a huge app for these telcos. Yeah, mapping is the killer app, right? I mean, almost everything on your phone that's local works off a map, which by the way is paid for us as taxpayers, because the GPS comes from the United States government. It's free, the most powerful utility in mobility is location and GPS is free. All right, final question. Bumper sticker from Mobile World Congress from your perspective this year, you honor, you know, golf clap or standing ovation? I said golf clap because more bandwidth is good. And I think there is an insatiable demand we're a long way from ending the bandwidth drought. And there is a bandwidth drought. So I think, you know, the other thing is like there aren't camps anymore. I think people will call less very quickly on 5G. So good time to be in that business. So one hand clap, baby. It's all a clap, yeah, not a hole in one. Certainly more golf analogies coming on theCUBE. Alan Cohn here, chief commercial officer at Illumia. We didn't get into security, but we'll do that next time. I'm John Furrier. We'll be right back with more Mobile World Congress coverage after the short break.