 from Boston, Massachusetts. It's theCUBE, covering HPE Big Data Conference 2016. Now, here are your hosts, Dave Vellante and Paul Gillan. Welcome to the Boston Waterfront, everybody. This is theCUBE's SiliconANGLE Media's special presentation of the Hewlett Packard Enterprise Big Data Conference. This is the fourth year of this event and theCUBE's fourth year of covering it. This is the Vertica users group, the roots of this conference were born out of the Vertica user group. And it's a practitioners conference, one for data scientists and one for analytics professionals. And when we first started covering this, Paul, the real theme was, hey, when are we going to start seeing big data move beyond ad tech? And today, Colin Mahoney, the general manager and senior vice president of the big data division of HPE, made a real point of talking about the human condition and the ways in which big data is affecting people's lives and expanding the use cases. I remember, again, the first conference we were at, I was doing some of the moderating for the main tent and people were asking that question almost in a hostile way, when are we going to hear about big data beyond ad tech? Are we there? I think absolutely we're there, Dave. And HPE, Colin Mahoney made an effort, a special point this morning to point out things like genomics, like manufacturing, the insights that we can generate from big data in areas outside of ad tech. This is very much a practitioner's conference, as you said. And the focus he said, I think the theme he said kicking off the conference was, we want this to be about what we're going to do with big data. You know, we've been talking too much so far about just gathering data. And why are we gathering all this data? Is it because you want to be bigger than the other guy? Is it because you want to employ more data scientists? You know, now that we've got it, now that we've figured out how to store it, we've got to figure out how to use it. And they very much want to take this event to the next level and move to these new use cases. Well, it's interesting too, you heard Colin talk about keeping data forever. A lot of customers want to do that. And that'll probably drive the general council crazy and give him or her Adjida. We want to ask Colin about that, right? You remember the days where, you know, data used to be a liability. And increasingly, it's like the bit has flipped and now data is viewed as an asset. And it's going to be interesting to see how organizations manage that data as an asset or liability. Like, you know, somebody, a financial person would manage a balance sheet. And whose role is that? I used to think it was the CIO's role. You did a conference this year, I wasn't able to attend, but the chief data officer conference with MIT. What was the sentiment there? Is data an asset? Is it a liability? Whose responsibility is it to manage that balance? Or is data now just overwhelmingly viewed as an opportunity? Well, the CDO role, and I believe at the conference we're referring to at MIT, Forrester was quoted as estimating there are about 3,000 chief data officers now employed worldwide. So clearly, organizations wouldn't be doing that if they weren't thinking of data as a strategic asset. As Colin again pointed out this morning, as you said, the bit has flipped. You know, we tend to think of data as being an asset that must be carefully managed. And certainly the relational heritage, the legacy, is of preserving data, minimizing system resources, and really trying to squeeze every last drop of value out of the data we have. You're talking about a change, a shift in perspective now, where you assume that you can keep all data forever. It's cheaper to keep it than to throw it away, right? So once you do that, you need to think differently about how you process it. Rather than minimizing system resources, you need to think about maximizing the value of that data. Very difficult, very different kind of concept to get your brain around. So the big announcement this morning was HPE's Vertica 8, the eighth instantiation of the software platform. Again, Vertica is a company that was founded in Cambridge, Massachusetts. Colin talked about two Cambridges, one where autonomy was founded, and of course locally where Vertica was founded. Vertica was a brainchild of Michael Stonembreaker, professor, Michael Stonembreaker from MIT, who had the epiphany that we need a new architecture, we need to go from sort of a row-based, relational database architecture to a columnar-based architecture to improve performance dramatically. And then Vertica began to find use cases, particularly in areas like retail, but it's really expanded much beyond that. We've had a number of guests over the years at this event, companies like Etsy, Wayfair, Guests, some really strong retail examples, but others as well, and we'll have more on today and tomorrow. But we were talking offline here, Paul, where does Vertica sit? So you basically have the Enterprise Data Warehouse, which is this sort of old, creaking proprietary set of structures, but critical, really popularized by Teradata, and Oracle, and many others. And then you had this plethora of columnar databases that came about. There was certainly Vertica, Natesa, Greenplum, Astrodata, and others that got bought up. I sometimes joke it was like a run on left tackles in the NFL draft, and everybody started buying these systems because they wanted to make sure that they had the ability to offload that Enterprise Data Warehouse was getting kind of creaky, and then all of a sudden this Hadoop open source meme exploded onto the scene, Vertica and others have sat in between is really where that fits. So in some respects a fence sitter from a market standpoint, it's not a gigantic market, it's not a 50 billion dollar business, but it's a critical one as we'll hear increasingly from some of the practitioners. And it's sort of a half step to the broader open source ecosystem, but the open source ecosystem, the Hadoop ecosystem is getting a bit of a backlash now, isn't it? Absolutely, absolutely. I mean the complexity of the Hadoop ecosystem is now a dominant topic of conversation. When I talk to people about big data, we hear this complaint all the time about just new Apache projects, it's an unmanageable sort of mess out there, and companies are like Cloudera and Hortonworks are trying to bring some order to it, but HP is doing so in its own way, and I think Vertica of course as you mentioned, it's a database, it's a product that sits in the middle, and the middle is always an uncomfortable place to be. If people can't put you into a bucket, into an easy bucket, a data warehouse, or a Hadoop data store, what exactly is it? You're very familiar with this, or your fourth year at this conference, I'm a newcomer to this conference, so it's been a bit of an education for me, understanding where Vertica fits and why I never hear about Vertica. When I talk to people about big data, the name never comes up, perhaps because they don't really have a clear definition of what it is. There's no doubt about the utility of having something to make better sense out of all that data warehouse data, that big messy Hadoop pile of data, bring those things together and query them at scale. There's no question that the columnar metaphor is red hot right now in big data. As a new way to think about data in an analytical sense, high-speed queries rather than traditional row-level information retrieval. So Vertica clearly is poised on the brink of being talked about in some very hot areas right now. But how did they break out and sort of become a dominant topic of conversation? I haven't seen the... Well, the amazing thing that you'll hear, when you talk to the practitioners that we'll speak to today and tomorrow and the ones that we've had, we've had probably well over a dozen over the last four years at this event, you will find that they're pretty passionate about, if not passionate, they rely on Vertica. I mean, it's a fundamental part of their analytics pipeline and it's a solution. So it's not an open-source sort of mess that's thrown at you. And at the same time, it's not a snake swallowing a basketball like your enterprise data warehouse. It's a solution that works, it's packaged, it's now HPE is standing behind it. It's super high performance and it's game-changing for a lot of these organizations. So today, as I say, Vertica 8 is the big announcement, focus on performance and scale, that's always been sort of Vertica's focus, but also clouding, what John Furrier calls inter-clouding, the ability to integrate with different cloud data stores, S3 and Amazon, and share data back and forth and populate Vertica very quickly through those stores. And Vertica's always been about speed. As I say, it's a rather large niche, but it is, to your point, a niche. The other point I'll make is it took HPE, now HPE, a while to figure out what to do with Vertica. I mean, I sort of bought Vertica, I almost want to say on a whim, the board said, hey, Mark Andreessen was talking about software eating the world, HPE buys Vertica and it got totally overwhelmed by the autonomy acquisition and all that noise. And so Vertica just kind of kept chugging along and this conference is really the metaphor for that chugging along. You're going to talk to people that are using it, have loved it, it's changed their business and they just sort of kept their head down and continued to perform. So we're going to talk to some folks at HPE about what Vertica 8 is and what the feature sets are there. The other thing is there's a backdrop. You've written about it, you're hearing about all these private equity rumors, what's HPE going to do strategically? Are they going to move the company to Houston? Are they going to spin off the software business to private equity? Again, who knows? I think clearly the HPE Vertica team is heads down, just trying to execute. It's like the trade deadline, right? Players can say, you know what? I don't know, I'm just going to... And the private equity firms would be circling Vertica. I mean, they would love, private equity would love to get a piece of Vertica because software is really what those private equity firms go after. HPE's big liability from private equity standpoint, frankly, is the hardware business, which is seen as being a business that's constantly under pressure. Declining price is not very attractive to investors seeking a return. But as you said, they bought Vertica on a whim, discovered that they had this gold mine there and have really been figuring out how to make something out of it. I took away from Colin Mahoney's keynote this morning, one of the important things was the ecosystem. Was the idea that Vertica is not going to be exclusive to anything, is going to play nicely with everyone, and that's a good positioning. That's a good idea for HPE to create this perception of Vertica as something that will fit seamlessly into your IT architecture everywhere. And that's the beginnings, I think, of really positioning this, a new positioning of this platform. Well, I think that was always been the big appeal of at least the big part of the appeal of Vertica to HPE. And so, but the gestalt here is there's been a 10-year collapse in infrastructure hardware and software pricing. And so, because of cloud and open source. And now you're seeing the Dell EMC deal, which still is not finalized yet. We had Michael Dell in the cube yesterday at VMworld, and it's coming, and my take there, and you and I have talked about this and SiliconANGLE has written about it, is China is extracting demands out of Dell. In my view, China slowed Dell down so that it can get by time for the likes of Huawei and Lenovo, it doesn't want a super strong, Michael Dell controlling China, and so it will extract extractions. But the gestalt really is that HPE and others are entering a new realm. And Dell and HPE are sort of lining up to be the arms dealers to the cloud to compete essentially through their channel partners and their service provider partners with the likes of Amazon. And you're seeing Dell delever a lot of its software assets might make sense for HPE to do the same. It's never really had the ability to dominate in software. It's got kind of this collection of misfit toys. So we'll see what happens there, but it's fundamentally back to Vertica. It's a great business. It's got high gross margin business. It's a growth business, and it's been a real gem inside of Hewlett Packard Enterprise, the final thoughts before we break. Well, just what you were saying about being in the middle and I think HPE still is a company that is kind of stuck in the middle. It is the most old line of the big tech infrastructure vendors in the way it distributes its product portfolio. There's a lot of hardware. There's some middleware. There's some software. And when you see what IBM is doing, which is essentially getting out of the hardware business, you see Dell getting out of the software business and these companies becoming more pure play vendors. HPE is kind of stuck there in the middle. If HPE was to go the private equity route and they would be delinquent to their shareholders if they did not look at that option at least. You know that they have to be considering it. A private equity firm would probably take a hard look at those hardware assets and say, how are we going to really ring the most value out of this company? You may see if they go that route, the hardware division's being sold off and that actually could be a chance for Vertica to start to rise. Well, and to the point, we're entering a new era of IT. The economics of this business are changing and so you need a Dell-like or an HP-like cost structure. EMC could not survive in that world. And I think you're right. HP's board must look at strategic options and it's got to put everything on the table as well as future acquisitions and game-changing stuff, lower cost structures. It's spun out, it's EDS division, it's global services division to CSC so it continues to reshape. I've said for years HP has to shrink to grow. That's exactly what happened when they split the company up and now it's a much more streamlined company and presumably can be more agile. So we are two days wall-to-wall coverage here at the HP Big Data Conference. Hashtag sees the data. You're watching The Cube on SiliconANGLE.tv and we'll be right back right after this short break.