 Live from the Wynn Resort in Las Vegas, it's theCUBE, covering .next conference 2016. Brought to you by Nutanix. Now here are your hosts, Dave Vellante and Stu Miniman. Welcome back to Las Vegas everybody. This is the intro to day two. Stu and I are going to sort of set the tone, give you a sense of what happened to the keynotes if you weren't able to see them. We were live streaming the keynotes, but Stu we saw in day two. It wasn't about the product. It was about thought leadership themes. It was about partnerships. We saw Microsoft up on stage. Great quote, Cloud is not a place, it's a model. We couldn't agree more. We talk a lot at Wikibon and SiliconANGLE Media about Cloud as an operating model, not a place to put apps and data. And it's really about the fundamental changes in your operations that Cloud is so interesting, at least to us. We saw Dell up on stage with Alan Atkinson. Alan Atkinson, former EMC, former bunch of different storage companies. He catalyzed the deal with Nutanix. We were talking to Alan a while ago and he said, yeah, I saw this company and I wanted to work with them. I wanted to partner with them. He went out and I said, Stu, I know you've talked to him this week. I didn't get a chance to you, but that deal seems to be working. People, I don't want to come back to that. And then we heard Mark Leslie talk about the ARC. Mark was the founder of Veritas. He's a professor at Stanford now. He laid it out. I mean, he nailed Oracle. He nailed Sun. He showed what's going on with Amazon. I mean, he really laid out how, for example, Larry Ellison made some bet your company moves that got them over into the next S-curve, like buying Sun, like the move to go ERP, like the move to consolidate the software industry. And then we had the CIO panel. But I want to start with Dell. So there's a lot of discussion about the Dell relationship given with Nutanix, given that EMC is going to get acquired by Dell. Many are predicting that's going to go away. We have been saying, don't be so fast to make that prediction. What are your thoughts? Yeah, I mean, at its core, it's very clear when you listen to Michael Dell as to what is important to him and the company, core of its business, you always say, what does Cisco care about? Cisco cares about selling those core networking products and the more things that generate IP traffic, the better it is for Cisco. Well, that's core of its business. What does Dell care about? Dell cares about servers. Yes, of course, they want to include more storage, more networking, more services and software that goes with that. But at the core of it, they want to be the leader in this next wave that comes through. I wrote an article in the fall last year and said Cisco killed it when it came to converge infrastructure. You look at all the solutions out there, they're the one that everything's based on. Hyperconverged, Dell is trying to be the leader in that space. If you look at the solutions that are out there, Nutanix use Supermicro, so Dell makes an OEM relationship to get them in the fold. SimpliVity uses Dell as their base hardware. Many of the other solutions there either leverage or partner with Dell. So Alan Atkinson got on stage and he said, the question everyone wants to know is, once EMC deals done, does that mean that's the end of the Nutanix? And he said, no, we've signed an extension to the OEM relationship. We're going to keep it going. So it's going to be real interesting to see the EMC VCE stuff once that starts shipping Dell and the Dell Nutanix piece, how that plays out in the channel and in customers and how those decisions get made. You know, I think that in looking at the history of these OEM deals, Al Shugard said to me one time that, Dave, if you got to split money with somebody, that means two guys got to make money and it's always harder. So in my experience and observations, these OEM deals have been really come down as sort of two categories. One is the company, the buyer, the OEM receiver wants to fill a hole in its product line or the other is in the case, for instance, of IBM in its storage business under Bill Zeitler, it decided that storage wasn't strategic and so it OEM'd a lot of stuff to guys like LSI and NetApp, so and they de-emphasized their own R&D, same thing with Sun, same thing, you know, early days anyway with Sun. And so what invariably happens is either those deals unravel because somebody can provide a better deal or the company decides to vertically integrate. For instance, in the case of IBM, they acquired XIV and they started to do more and more of their own. But there are many cases where it's been long-term. Look at HP and Etachi, previous to that EMC. The EMC deal unraveled because it was a negotiation issue. We have a great conversation in negotiation later. But so here's, I guess, what's my point? My point is that I think this deal is going to be solidified for quite a number of years. I think long-term, you know, Dell will have to make the decision as to whether it wants to vertically integrate and I think EMC's got technologies that will probably eventually get there, even though they may not be as advanced, but they'll make more money on that. And that's going to be a business decision, but I don't think that'll come for four, five, six years down the road. Yeah, and just one thing, people tend to overestimate how much of Nutanix's business today is with Dell and not only does the Nutanix have Dell, they also have Lenovo's up on stage. Radhika was talking about the partnership, which is brand new. We actually have some Wikibon research looking at that environment up on wikibon.com right now, but combined, Dell and Lenovo, that's not even a third of their business today and they're not looking for it to be the majority of their business. Nutanix has many paths to market and the OEMs are a piece of that overall puzzle so it shouldn't be overstated how much Nutanix is relying on that. Well, and Alan Atkinson threw the number, he says a 10-figure pipeline. So we're talking 100 plus million in pipeline. That's substantial. That's going to take a while to play out. I think if Dell and EMC can figure out where to put that product in its portfolio, how to appropriately compensate people, how to deal with all the inevitable channel conflicts, and EMC in particular is very experienced at doing that. And I think that, so I would expect really good things and that's going to be great news for Nutanix in a period of time but I think the company has to be careful. It doesn't want that OEM revenue popping up to 20, 30, 40% of its revenue. That would be a warning sign in my view and I think they're managing that pretty carefully. I think they've done some interesting things with deal registration that are protecting the channel so that's good. Let's talk a little bit about stack ownership. What is going on here? Is Nutanix trying to be the next VMware? Yeah, they definitely, last year they moved up the stack, they announced their own hypervisor. Nutanix isn't trying to be the leader in hypervisors, they're more trying to offer a platform and give customers choice. You said we saw Microsoft up on stage, we're going to have them on theCUBE today. The Microsoft stack, what they call Microsoft CPS, that includes Hyper-V, so a lot of Nutanix customers are still doing mostly VMware. We're getting, when it comes to the Acropolis hypervisor, it's 15, 20% of customers at least have some of that in their environment. So we're going to see choice in there and most customers are going to have more than one hypervisor. When I talk to a number of Nutanix customers that are trying out and starting to use Acropolis and it's not a sweep the floor, it's a tactical thing that they'll do to save cost and simplify their environment. And at the end of the day, there's a great line from Sunil yesterday on theCUBE, is what is the stickiness of Nutanix and it needs to be really that simplicity and making it invisible. And if that can include a larger piece of the stack where I add in the hypervisor and maybe I add in more of the management stack, great discussion at a Docker column this week as to Docker's integrating orchestration into what the base Docker platform is in the Docker 1.1.2. So used to say, how many different pieces do I need to cobble together? We love building these stack diagrams, Brian Grace Lee is great at doing those and the more I can boil that down to a single, what David Floyer calls a single managed entity, the easier it is and the higher up the stack I go, we actually see exponential value to the customer because it just takes just so many things off of their plate to help us focus on the business, growing the business and transforming the business rather than just running the business. Well, and that's where Oracle's making its hay and so-called engineered system. So, okay, real quick Stu, your take on the announcements yesterday and today. Yeah, so I mean, more than we have time to go through right now, Dave, but absolutely, they're baking out that stack, they're maturing it, they're giving that vision as to how they add in and not just inspired by cloud but really, how does that hybrid cloud or what the Nutanix is calling the enterprise cloud message fits? All of the companies that have on-premises as their primary deployment model are struggling a little bit with how do I interact with the AWS, Googles and Microsoft of the world interested to dig in more on the Microsoft piece here. But good progress, good mix of the stuff that's available today and enough vision for what's coming down the future. So, good crowd and we've got a full day of coverage here to talk to a bunch more practitioners. All right, Stu, great analysis as usual, thank you. Let's talk about the future in a minute. We've got Mark Templeton coming on. How do companies stay relevant? There's a lot of talk about consumerization of IT. What about the humanization of IT? We're going to have that conversation with Mark, former CEO of Citrix. Keep right there, everybody, this is theCUBE. We're right back from Las Vegas.