 Live from Madrid, Spain. It's theCUBE, covering HPE Discover Madrid 2017. Brought to you by Hewlett Packard Enterprise. Welcome back to Madrid, everybody. This is theCUBE, the leader in live tech coverage, and this is day one of HPE Discover Madrid, the European version of the show that we cover in Las Vegas in the spring. My name is Dave Vellante. I'm here with my co-host Peter Burris, Bill Philbin is here as the general manager of the storage business unit, and he's joined by Eugene de Prey, who's the director of systems engineering at the Fox Group, gentlemen. Welcome to theCUBE, thanks for coming on. Thanks. Bill, it's always a pleasure. I see you more than I see my wife sometimes, I think. You know, the last time we spoke, we talked about merit badges, do you remember? I just came into my mind, which is that seven or eight years in a row, I thought I'd get a badge or something to offset my element here on my lapel. Yeah, well you're... I'm still waiting for it, I'm still waiting for it. You're there in terms of one of our most popular cube alums, so thanks again for coming back on. We'll give us the update on the event. We did some deep dives in Boston recently, so we got a good Kool-Aid injection from you guys, and so we're here at the show. What are you guys talking about? Well, you know, the wonders of the storage market continue, transformation continues, right? We were here six months ago, and we were talking about, so at that point, the nimble acquisition, now six months into that, we continue to see sort of the business transform itself. There's really three things we're talking here at the show. One is we're talking about InfoSight, but InfoSight in a much broader sense, not sort of solely limited to nimble, but InfoSight for three part, but more broadly, InfoSight as a basis for AI in the data center. So if you think about, you know, sort of the experience our customers are looking at from on-prem versus off-prem models, they're having to look at things like, their cost of delivery, ROI, et cetera, and InfoSight is much broader than just sort of improving the support models all about how do we sort of take the on-prem experience and make it such that it's actually self managing and self healing, and that's where we're headed with InfoSight and not only in storage, but also across the whole data center. And that was number one. Number two, we're focused on cloud ready. You know, as customers are having to make this sort of decisions about what's on-prem versus off-prem, you and I were talking about this over dinner last night, how do we easily facilitate that? And so the whole message from Hewlett Packard around hybrid IT is, is compute and data where you want, what's relevant to your organization. And then number three, as customers are looking at consumption based models, they want the, you know, as they move data, they also want to change the way they consume storage, right, or consume data center assets. So CAPEX and Flexible OPEX models that parallel what they're seeing in web-based properties. So it's all about, you know, choice, it's all about giving them the same experience that they'd see in a web-based property, but not without some of the downsides of data sovereignty, SLAs, dead integrity, and sort of other issues. My friend here Eugene at Fox is a big supporter of storage, of Hewlett Packard storage. And so I thought it would be interesting to sort of get not only what the vendor's view of the world is, but, you know, let's hear it from a guy who's actually got the real-life, you know, problem of deciding, okay, what's inside, what's outside of house, how does he consume our stuff differently? So that was the rationale for bringing Eugene along today. Well, we love to talk to customers. Eugene, let's hear it from you. First, help us understand your role at Fox, and maybe let's get into some of the business drivers and how those trickle into IT. Sure, so my position as director on the architecture and engineering team, and our responsibility is delivering services, if you will. The idea of delivering a technology stack of servers or network or storage has blurred, and now it's delivering a service. People are not reaching out for this many CPUs or this type of disk, or this many spindles anymore. They know what they need to do from a business perspective, and it's our job to translate those business requirements to system requirements that we can then deliver a service with. So what are the big drivers in your business, and how are they, I mean, you sort of described how they're affecting IT, but what are the big drivers? So entertainment is morphing dramatically, and of course Fox is in leader in the entertainment industry, and competition is coming from new avenues, and the way people consume media is changing dramatically, and we need to adjust to all of those types of requirements, whether it's new ideas in production or new media plant platforms for distribution. So obviously part of that is speed, agility, time to market, flexibility, getting new products out faster. How do you hide the complexity of your infrastructure generally, maybe storage specifically from the business? How do you make it not an inhibitor? So historically people would actually buy their own components, right? They would be responsible for a capital budget tied to a project to acquire X number of spindles, and that's gone, that's gone. People are now more concerned about throughput requirements, but it's not along the lines of how many gigabytes per second, it's I need 4K, we're going to use 4K transcoding, I need to have eight people to be able to view this simultaneously, and that's what they want. So they don't want to know about the complexities of what's behind the mask, if you will, or behind the curtain. So it's more of a shared services model, and you're trying to sort of deploy shared services capability that's capable of scaling, you know, to meet the demands of your consumers, right? Exactly, and productions don't want to own their own hardware anymore. They want an operational model where they have some cost associated with what their consumption is for the duration of their production. And from Fox's perspective, if we do this from a shared services, centralized delivery model, then there's efficiencies and cost for that delivery, and there's immediacy. As soon as they need it, it's available. So in many respects, we use an architectural parlance. You are creating the business capability, architecturally, that is facilitating the process of creating the digital assets that make Fox money and make Fox profitable. Exactly, so. And doing so in a way that the customer is not exposed to the underlying transaction costs associated with different infrastructure options. Is that kind of where you're going with this? Exactly, exactly. So the productions can worry more about what they do, which is creation, right, and creativity, and less about what is underneath it that's enabling the storage and distribution of that media that they're creating. The whole media business, as you've articulated, is going through a significant amount of change, but there is still a need to capture activity or capture things where it's happening. So talk a little bit about how the relationship between storage and network, file size, file security, the ability to create an asset at the moment that it's being generated, as opposed to a couple days later when it's being rendered. How is that all coming together so that data is dictating the model that you use to actually make all this happen? So we actually have mobile setups that are associated with, say, motion capture stage. And then that has to be centralized. The transcoding will happen at Fox Media Services and then distribution from the Fox Media Cloud. So all of these different units have to be coordinated, such that the data hasn't even flow from the capturing on the stage to the transcoding and the editing to the final transcoding for the completed media for distribution and then off to the distributors of the content. Can you talk a little bit about, dig more into the operating model? When you go back and look at your career, you know, 10, 15 years ago, you had to get down and dirty. You're doing sort of unnatural acts to make infrastructure work. You know, Fox I'm sure doesn't want to invest in that kind of heavy lifting. It wants to transform its business. How has the role of an infrastructure professional changed over the last five or 10 years? Well, so, you know, we used to have issues where we would say, as hardware age, the OPEX would go up and that would become a challenge. And they say, we'll drive down the OPEX. So we would buy new hardware to drive down the OPEX and then that would drive up cat that. So now we're coming back around to, let's get away from this cat that's model and get more towards an OPEX type model. And so leveraging things like cloud storage and that flexibility to burst outward if we, if our on-premise is insufficient and designing an infrastructure that is not dedicated to specific project or specific need, but more general to performance level. So this is where we're headed now. But as you look back, someone in your role, someone like you, was responsible for making sure that the hardware assets were productive and taken care of. And now it sounds like you're more focused on making sure that data assets are generating return for the business. That has an impact on your relationship to your key suppliers like HPE. First off, have I got the right that you're moving from a hardware focus to a data focus as you generate a return for the business? And secondly, how is that impacting some of those strategic relationships with some of your key suppliers? Well, so as we talked to Bill and we were talking the previous evening, we still are buying assets. We still have hard assets that are available locally, but we need to also be able to branch out. And this was one of the things that, you know, everybody talked about cloud and let's get to the cloud and move things to cloud. And we looked at like the gateway devices that were available and they seemed cumbersome. They were proprietary in nature. They used the term optimizing my data, but what that translated to was storing in a proprietary format that only they understood. And we didn't want to get locked into this gateway or that gateway and we were really looking to our vendor partners to say, how do we integrate these new storage capabilities, new compute platforms into our infrastructure that we have, our hard assets that we have on premise. And that's why we're very excited about these new capabilities that we're rolling into the store once. And we're looking to continue to expand that capability with our partners and making those things innate to the storage platforms that we've purchased. So what specifically does HPE do to support that operating model? I mean, is it, you know, the way it prices? Is it services? I wonder if we can unpack that a little bit. Sure, sure. You want to talk a little bit about sort of, you know, your version of archiving versus backup and what's going to be projected into the cloud versus what's in the data center and how does cloud banks sort of support those? Support that? Well, we're very excited about cloud. Right, one of the challenges that we have with backups is you have to have on premise and off premise copies. And if I'm doing all of this within store once, now I'm putting up two hard assets. I'm using dedicated circuits to connect between these assets and our consumption rate is doubled, if you will. Right? It's expensive. It's expensive. And then we're looking to the hardware vendor who's profiting from this expense to say, how do I drive this down? Right? How do you make less money? It's not a good analogy. This is Phil, but he's not very happy with this whole problem. So you can see, it's almost a conflict of interest for our partners, except for that, you know, I don't call them a vendor, I call them a partner. And we have a shared success model. Right? I need to make sure that Fox has the capabilities that it stays competitive in the marketplace that it competes in. And I need to work with the vendor to provide that solution in a cost-effective way. And if Bill and HPE's interest is only in themselves and only in selling me hardware, well then they're not my partner. Right? So we meet and we meet with engineers and we talk about next generation capabilities and the things that are driving our business requirements and our business model. And HPE's been very generous to allow us early access to the different capabilities, including Todd Bing. Right? And that allows us to develop and deliver that service that is necessary for Fox to be successful. So you have to figure out, okay, how can I still invest in R&D and start my operation and compete? So customers are going to go to the cloud as we were talking about. Data used to have gravity, right? And now data and compute need to sort of come together and customers want the ability to sort of move data to where they see the need arise. Not encumbered by the infrastructure. Not encumbered by the infrastructure. And it's also not a bursting based model, which occasionally I need to go to the web. No, there's assets that are perfectly acceptable to sort of be deposited in the web, you know, sort of ad nauseam or ad infinitum, right, you know, permanently, right? And the way that you're looking at it is, how do I sort of take an infrastructure copy that used to be in my data center, assuming, you know, power and heat and cooling, right? And how do I sort of take a copy of that and make that available, but put it on a platform, which is cost effective. Exactly. And without, though, however, the sort of the huge operational running cost of knowing where that data is residing. So it's, you know, how do I make it operationally efficient, cost efficient from a storage perspective and have it be reliable and available? But also create new options for the business. That's right. Because that's how, certainly in a media company, that's how a media company is going to make more money. Is by putting in place infrastructure that creates new revenue options because you have a way of facilitating sharing in a secure manner that diminishes the invasiveness of the underlying infrastructure. That's right. Exactly. So I think, the way that I think you think about it, it's all about choice. And if Eugene decides that he wants to store asset X, Y and Z in the cloud and he wants to store asset one, two, three inside of his data center, our obligation is to enable that transformation for him and recognizing that the better that we do that, the better partnership we're going to have and the better way that we're going to sort of move our businesses forward together. Between Fox and Hewlett Packard, we have a rich history of partnering when HP was in the PC and printer business and that's transformed now into the HP Enterprise. And so I think this is, I think you said it right. There's a difference between a vendor and a partner. And a partner, exactly. A partner's there in the good times and in the bad times, right? Who's there to help you with your transformation isn't only in it for themselves. And I think that's sort of, if I can sort of think about our relationship, that's what it is, right? And that's exactly where we're at with HPE is a true partnership, right? Where we share in each other's success and they understand what our business requirements are and how they're changing and they're incorporating those requirements into development of the next generation of the product. And we're very fortunate then to be able to get early access to those products and those offerings so that we can co-develop them and resolve issues that arise and protect the product as it matures. So Bill, I want to end on the storage business, the business that you run and you got an engineering background. You're now the leader of this business which comprises a component of hybrid IT, the new reporting structure that we're going to see in the future. But one of them a takeaway is from Andover. We had a deep dive in Andover a couple of months ago, was that you guys are in pretty good shape in the following. I'll summarize it and then I'd love you to chime in. You're gaining from share. You basically have to hold serve with 3PAR. 3PAR was, to me, was the savior years ago. That's right. Came in and really affected. It was a gift that kept on giving. But you could only go to that well so many times. You've now made a couple of key acquisitions in the form of Nimble. SimpliVity. Where you get impsites, SimpliVity. That's right. You basically hold serve with 3PAR. And you've got growth opportunities with both of those assets that we just mentioned. So maybe that was kind of my takeaway. It was, wow, you really came into focus a little bit. How do you sort of look at your opportunity going forward? Well, so I mean, the best way to think about it is, you know, when I joined Healer Packard now almost eight years ago, we were probably six or seven in the storage business. Today we're sort of on the cusp of sort of being number two, you know, neck and neck with NetApp. So I think the growth has been tremendous. Second, that growth has been on organic as well as inorganic options, you know, StoreOnce is a good example of organic option we built. Inorganic, you know, one can't argue about the success of 3PAR, right? It's the number one mid-range brand in the world. Nimble brings with it a flare of sort of next generation storage capability with Infasite across the top. Infasite now deployed on 3PAR means that we can start talking much broader message about how we transform our customer's ability to sort of run their businesses differently. So I think that's important. And then when you look at SimpliVity, you know, the focus around hyperconverge and how we sort of offer customer solutions there, I think if you take a look at the broad breath of the portfolio, if you're an independent storage company with one thing to sort of shuck to the street, you're going to have a problem. If you're an independent storage company without a connection to the rest of the data center with compute and networking, we think you're going to have a problem. If you don't have sort of the broad orchestration sort of story around like synergy or one view or new stack or other things that HP is now talking about, we think you're going to have a problem. And so, you know, storage in a sort of a Ptolemaic sort of viewpoint, right? Which is we think everything revolves around us is uniquely positioned to actually help our customers transform, but it comes down to choice without operational complexity with a breath of the portfolio that allows a customer to make the right choices of on-prem, off-prem, hardware, software defined, hyper-converged. Today and in the future. Today and in the future. So we think that Hewlett Packard Storage is actually in a tremendous position to sort of help our customers like Eugene and others out there to run their businesses effectively. Well guys, thanks for coming to theCUBE, Eugene. We always love to have the customer perspective. So Bill, thanks for having him come with you. I'm looking for year number eight or nine. So, you know, if you're out there, buy some more storage so I can keep coming back and seeing Dave. Good, there you go. And no partner with you. Yeah, exactly right. That's really appreciate it. All right, keep it right there everybody. We'll be back with our next guest right after this short break. This is theCUBE, we're live from Madrid, HPE Discover 2017.