 Live from San Francisco, celebrating 10 years of high-tech coverage, it's theCUBE. Covering VMworld 2019, brought to you by VMware and its ecosystem partners. Welcome back, this is theCUBE, two stages, three days of coverage, our 10th year here at the VMworld show. I'm Stu Miniman, my co-host for this segment is Bobby Allen and welcome back, two of our CUBE alumni. As I said, back in 2010, we didn't even know what a CUBE alumni was. People were trying to figure out what we're doing, but now we have thousands of them and both of these gentlemen have been on the program a few times. Thank you for having us back. You're welcome. So, first over we have Ajay Patel, who I believe was actually doing another filming even with our crew earlier today. The Accenture Innovation Center. Excellent, beautiful building Accenture has here in San Francisco. One of the other benefits of being back in San Francisco is we've brought in people and it's really easy to get in and out and do other things in the valley, but Ajay is the senior vice president and general manager of the cloud provider software business unit inside VMware and one of his partners is Rackspace. We have Peter Fitzgibbon, who's the vice president of Product Alliances with 4Mention Rackspace. Super to be back in San Francisco. It was a great change from Vegas. Yeah, you know, there is some debate in the community. Of course it's a little more expensive here in San Francisco and there are other logistic challenges. We're excited to be back here and yeah, really excited to be talking with both of you. Peter, let's start. Rackspace has had a long, long partnership with VMware. When I remember back to VMware environments hosted, it's like Rackspace was the one with a lion's share in that market and Rackspace has gone through a lot of changes in the last 10 years that we've been doing this coverage. When I think about multi-cloud and all of these environments, you've got a nice perspective on this and lots of customers you'd work with. So it gives the update on what you're hearing from customers and your relationship with VMware. Yeah, so 20-year history with VMware that we're very proud of. I would say it's almost been re-birthed in the last two years though. Well, two years ago, we were one of the first VMware Cloud verified partners. We launched our VMware Cloud Foundation Private Cloud. We added to that about six months later in customer data centers. We're now one of the major partners of VMware Cloud on AWS. And that's one of the areas that we're continuing to expand upon. We announced new services this week specifically around VMware Cloud on AWS for support of HCX, both for migrations and for ongoing support, as well as a number of what we call Rackspace Service Blocks, which are additional managed services that we're applying specifically for VMware Cloud on AWS. So, exciting times at Rackspace and VMware continues to be like a major part of our portfolio. And thank you for all the support, Peter. Yeah, so Ajay, bring us up to speed with what's happening in your space. A lot of attention gets paid every time. I saw Sanjay Poonin up on stage at the Google Cloud event. And of course, the AWS partnership has been one of the biggest stories in all of tech for the last couple of years. And that's been extending to, first it was like, wait, Rackspace has data centers and many of your other partners have data centers, but how do these all play together and how does the VMware software pull them all together? So Stu, I think you've been talking about this world of hybrid multi. And we've been arguing whether it's just a transition phase or here to stay. Hopefully that debates over, right? Hybrids and new reality, multi-clouds and new reality. And we talk about these hyperscalers, but Rackspace and many of my VCPP partners, they've been long standing in this journey with us. I don't know if you caught Pat's keynote, we demonstrated that we have over 10,000 data centers through our VCPP network and Rackspace being one of our top 10 partners. So you start to start seeing this mix of VMware everywhere, whether it's through a service provider cloud, the customer managed cloud, or even a hyperscaler VMware cloud, you now have the ubiquitous VMware infrastructure to play with. At some point it's just cloud. We stopped going multi-library. I think that's a great point. When I talk to customers, most of them, they have a cloud strategy. It's usually not a hybrid or multi or all these things. Here's the nuance I want to ask for a second and I definitely want Bobby to jump in with what he's been talking to customers about. Hybrid cloud is reality because customers have their own data centers and they have public cloud. The ideal of multi-cloud, customers have multiple clouds, but one of the definitions I put out there is multi-cloud exists when the multi-cloud solution is more valuable than the sum of the pieces. And I'm not sure that we're quite there yet. I think we're starting to move down that path, but what are you both seeing and does that resonate with what you see today? Yeah, all of our customers have workloads in multiple locations and trying to provide the assessment of where to put the right workloads at the right time is one of the key values that we hold dear. And before we ever talk about where we're going to put a workload, we assess what a client's environment is and determine maybe this is a native less workload, maybe this is a VMware native less workload, maybe this workload really belongs in the data center for due to laws of the land or laws of gravity and physics. And I think what's happening really is that any application, you're typically choosing a platform or the cloud service that's driving the decision. Collectively what ends up happening because of that you're in multiple clouds. So I think it's a result of the reality that applications are driving location and platform choices. And the way to drive consistency is trying to pick a few common things whether it's Kubernetes as a cloud platform or VMware. Those are the way to kind of unify these disparate choices that are made individually that are collectively making each of our customers multi-cloud, right? Jay, I want to piggyback on that because you talked about the applications driving a lot of the choices. When application teams in my experience are kind of making the choices, they don't care about a centralized strategy. And obviously this very powerful partnership can support multiple places and ways to run your workloads. How do you lead the witness a little bit towards simplification? And just because you can do it doesn't mean you should do it. Yeah, so I think what's happening from our perspective is depending on which side of the IT house you're in. If you're part of the core IT that's running and maintaining machine critical systems, you're really looking for something that's reliable, performance, scalable, secure. And you may be looking at a hardware refresh or you're looking at your data center strategy and you're looking to migrate that workload. You're not looking to really re-change the app just because it's cool. If you're part of a digital transformation effort you're looking to say, okay, how do I get something out there quickly? How do I integrate and leverage my data and application assets while leveraging cloud services? So we're seeing this tension in some ways where the kind of net new is really pushing the envelope of cloud with self-service, elasticity, new capability. Whereas the old guard is like, I got to keep my running, business running. Keep it secure. And how do you bridge these two worlds and bring them together? We call it DevOps and ITA and the traditional kind of new developer. The reality is you're trying to bring the two worlds on a common platform. Whether it's VMs or containers. And so the exciting part for us is how do we unify? How do we deliver this experience and give them that choice where it makes most sense? And blur the lines between public and private. Those are just locations that makes most sense where for your customer or your application that you can drive. Excellent. We find ourselves in those conversations all the time trying to bridge two sides of the equation at a customer and trying to get them together on a unified strategy and weighing the pros and cons of different locations for different workloads. So it's not easy. It's a challenge of course. Peter, I'd love you to bring us inside some of those VMware on AWS customers because some of the first customers I talked to, it was, I'm a VMware shop and there's a part of you group that's like, oh my gosh, I can't change. And this was the driver to say, hey, you don't need to. We can bring you along. But the value once again needs to be, oh, hey, I need to do some innovative things. I want to be able to access some of those cool amazing services that everybody's providing on a daily basis. So are you seeing that progression? Are there any interesting use cases that are coming out? Progression is the word. We call it progressive transformation inside Rackspace. So you're a VMware customer. Let's bring you on the journey towards public cloud and let's help you leverage those AWS services. So we find ourselves in a great position with a very large number of engineers that support our native AWS workloads. We've brought those two groups together from our VMware expertise and our AWS expertise. So when a customer lands on VMware and AWS, I consider it a failure if they haven't transformed part of the application within three months. If they're not really consuming those native AWS services. And that's what we really try and jack is like, get our AWS engineers looking at those workloads. Let's start consuming those native services. And that's what we're finding really exciting about how customers are starting to adopt and starting to plug and play into some of those services. I mean, I look at it as you'll see a team, this Sanjay called M&Ms migrate and modernize. But part of the migrate is often modernize your infrastructure first by putting on a modern cloud platform and then modernize your application using cloud services. I would say it's M, M, and M to follow through because it's not just about lifting and shifting and keeping the old crap as it is. You got to really start to look at how do you drive innovation, drive you in a better place so you can operate it more effectively and then modernize for application results. And your service blocks are really catered to helping the customer. So maybe you can talk a little bit about building the services that Complement are offering. Yeah, so our service blocks is in the past we offered them one big block managed service to a customer. We realized let's decompose that and offer the customer what they need at a specific point in time. So we think of it like Lego blocks where at some point you may need just some support. Other point in time you may need some architecture services and design. And other times you may take cost optimization and the sort of stuff. So over time we're adding on these Lego blocks if you will to add a customer, give them what they need at the point they need it and not more. So it's an exciting concept that every month we're adding more services. So we launched an Rackspace managed security service block today specifically for VMware cloud. So we continue to add these and provide incremental value. I want to ask you a little bit of a controversial question. So there's a saying pioneers take the arrows but settlers take the land. So if I'm a technology leader how do I embrace all this newness without getting shot? Partnering with your firms. So you know, we always say lock ins bad but reality is we always choose strategic technology platforms. And if you're a VMware customer, I hate to say it. You're running on VMware infrastructure. You have VMware ecosystem. You have VMware runbooks. You have VMware partners managing your on-prem assets. What if I could show you a path forward on any cloud of your choice without having to change any of your day-to-day operation while leveraging the innovation feature? What is the safest path for you, Mr. Customer? And so in this world, you can think of us being the laggard in some sense, because we're not pushing them to a single destination. We're giving them that choice, leveraging the strength. I think the innovative part that we've done today is really brought containers and VMs in a single solution. We talked about containers killing VMs two years ago. VMware was going to be in trouble with Docker. VMware was going to trouble with OpenStack, where are those two companies, and where is VMware? It's about simplifying for the customer a common resolution. And we're taking those choices away and making it just easy. And giving partners who can help them on their journey. So I would say we're the safer choice than with my response. Peter, we're not going to ask you about OpenStack. I'm still going to take everything back to VMware, so it's work in progress. I'm sitting beside you. Interesting point, the settlers, right? At this point, VMware Cloud and AWS is two years old. I think that first year, well it was definitely some pioneers out there. But now I think we're really in there where the settlers are coming on and we're seeing large-scale adoption of the platform. And now that VMware's offering more and more services natively, we can add more and more of those managed service and help those customers really transform and not worry about the underlying IaaS. That's rock solid at this point. Peter, I would like you to get into a little bit kind of the containerization in Kubernetes. Docker, obviously a lot of hype, but containerization is hugely important. A lot of the keynote this morning was talking about Cloud Native. I talked to lots of customers. There's some that, yes, they will want the VMware journey, but many of them say, well, if I'm going to the cloud, I can just use containers. Why would I have the overhead of VMs? Cloud Foundry was originally curated. It was not for that type of environment. So where does that fit into your world? Containerization? Yeah, we actually launched some more services on that today as well. Some more professional services and managed services to safely around advanced Kubernetes support across all our platforms. So this isn't just a VMware announcement. This is on AWS, Microsoft, Azure, and Google. So another exciting progression in our hybrid cloud story and making investments in those resources to deliver Kubernetes. We also launched a Cloud Native service block today as well that is really giving customers access to deep engineering skills and giving them cloud reliability engineers that can help them transform their workloads and get them ready for the cloud. I think for us, if you project, sorry, Tanzu as a solution and project Pacific are two marquee announcements we made this week. And if you look at what we're focusing on, the build run manage aspects of the full lifecycle and our active participation in the Kubernetes community. We're starting the beginnings of what, it felt like Java in 2001, I was at B.A., right? WebLogic in Java was the right runtime for running and building new apps. Kubernetes and containers of the new runtime for building distributed apps across cloud platforms. And we're in this early journey and we are uniquely in opposition with a combination of Pivotal for Build. With project Pacific, we're bringing containers into vSphere. So VMs and containers become first class. Three-year point, we demonstrated 8% performance improvement over bare metal on a vSphere container-based solution. Starting to engineer based on the key scheduling work that we do in the kernel and in the hypervisor, we're driving that deep into the Kubernetes platform into the core platform itself. And then manage is going to be the new interesting bit. What is that control plan that everyone's going to fight over and the managed services partner who can help them choose that? So I think the battlegrounds more and more are going to manage. I think we've secured our base with the runtime and the build will be about choice depending on the kind of applications you want to build. Like, Tanzu's music tour years. It was like, we can now again focus on what's the additional managed services and service blocks that you can build. And how do you call the customer build apps and change the engineering culture that's what you provide? We just give you the runtime across any of these clubs. We don't help everyone transform the applications, also transform the culture and how they do their business and all that rapid or fanatic experience. It's the engineering transformation is a big one. SaaS transformation we talk about internally for us VMware, same with our customers. You got to change the mindset of how you build applications in this container-based services-based architecture. I agree. What else is keeping folks up at night that you talk to? Love to know that, just hot tape. Nothing keeps me up at night. This is an exciting world we live in. So loaded question. What excites me? What excites me is the progression that VMware and AWS is making. And the announcement with NVIDIA and then GPU access I think earlier next year. I think that could be another wave of VMC adoption. So not keeping me up at night, but keeping me very interested and excited. I think to that point, I think I'll build on what Pat just said about tech for good. I mean, we have a joint customer feeding America. Yes. Right? We're now taking technology and making it available so that the 60,000 plus distribution centers that they have are up all the time. They don't even worry about infrastructure. They can focus on feeding the cause, which is I think 47 million. Wow. People being fed may be scary, right? I want to bring it back to the organizational discussion you said you're helping customers with. Because if they were worried about racking, stacking, configuring, doing all of those things, how do you help them? Because I tell you, I talked to a number of customers of this show and they said, look, my roles in my organization are still hardware defined. Yeah. And it is tough to move into a software world, but if I want to get to the tech for good, I need to be able to move the organization. I'll lift my skills. I'll lift my organization. Yeah. It's difficult, right? Organizational change is different for every company, but as part of digital transformation is also organizational transformation. So I'm helping customers think about what is the progression from a VMware administrator to a DevOps? Cloud admin. Cloud admin, indeed. It's not easy. It's a short answer on that. I think for us, it's really starting to drive the cultural change, providing them the tools, and bring the set of services where they can be a coach, right? Be the trailblazer who can come in and help change the organization. Teach them how to do it right. Not everybody will get there. Hopefully a bulk of the organization can ship, right? Peter and Ajay, I want to give you the final word as you want your partners and customers to understand takeaways from VMworld 2019. Yeah, it's great to be here as usual. Thanks for having us. I think Tanzu's really exciting, the progression that we're making with adding service blocks on top of VMware and AWS and other hybrid cloud announcements. So great to be here, but Tanzu's kind of the story of the show. For me, it's a VMware is here to stay. We want to be, we have been your strategic partner for the last decade. We're here to stay for the next decade. We're going to help you solve these hard, complex problems and give you the choice you need across a broad ecosystem of partners and solutions. So we're excited to be here and deliver that value. Excellent. Ajay and Peter, thanks so much for joining us again. Bobby Allen, thank you for co-hosting. I'm Stu Miniman, and as always, thank you for watching theCUBE.