 coverage, this is John Furrier from SiliconANGLE and I'm joined by CUBE alumni, Sargillai, Senior Vice President and General Manager of the Business Unit for Cloud, globally for HP. Welcome back, Sarg, great to have you. Great to be here again. I've been following your tweets and your photos and getting the view of your segment. Great stuff here. You've done an amazing job with the cloud. You know, you've now been on the CUBE multiple times. When the CUBE was first trying to figure out the cloud, you were the first guy to say, hey, this is what it looks like. And you've laid it out very cleanly. Now it's taking shape. You're running the Business Unit for Engineering, Product Management, go to market. Give us the quick update on what's happening. Well, we've made a lot of progress. You know, we talked about, when we talked about first last year, we talked about the fact that we want to have sort of one unit at HP that covers cloud all the way from consume to build was management. And you know, that's really what we've been doing. And so, you know, we've made a ton of progress to look at our contributions. We talked about OpenStuck, we released CloudOS. So we've sort of now have that moving. You know, we talked to one of the other things we did is, you know, we want to make cloud easier for our customers to consume. And so we've built our separate go to market organization that handles clouds. So if you want to, if there's an engagement around cloud, we'll send the clouds or any architect over and he will work with the customer and figure out what the right solution is. From the engineering side, we now have all the core technology under one Business Unit, right? That builds the whole core technology both for the public cloud and the private cloud and will to be adopted by the men's cloud all in one place because that helps us create this sort of one consistent architecture for cloud whether it's public, private or managed. You guys done an amazing job. I got to give you some props on this because when we were very, I was very critical of HP's cloud early on, as you remember our first couple of interviews. It just didn't, it wasn't coherent. It was kind of all up place. You lay calm down, settle down. I mean, the good news was OpenStack was a great spot for you guys. You guys had good beach head in OpenStack and you guys developed that nicely. I want you to, right now you got cloud in a really good position. So I want you to go back and take me through the play-by-play, to some extent, short inversion of how your execution got here. Specifically, you can't just get to a good position. You guys really worked hard. You cleaned up the story, but take us through some of the execution on the product side and the engineering side. Sir, well it all starts first of all with support from that. So when I took over 15 months ago, at that time we had a good strategy with the Converse Cloud strategy was there, and we had a bunch of products. The problem is it was all very siloed and Meg had realized that and everybody had realized it but they're trying to figure out, okay, what is the best way to move forward? And we had Mark Potts, who's the CTO for Potts, have come up with a strategy, but we were having execution challenges. And so the first thing we wanted to do was for say, okay, well where are the problems, right? And so we saw there were two challenges. One challenge was that again, all the engineering was siloed and even if people had the right motivation, it's very hard, especially in a business unit to focus on sort of the long-term stuff because they're always meeting quarter to quarter. And the other problem we had in the go-to-market was that the go-to-market was very siloed as well. And so one of the things you want to do in cloud is when you come to a customer, if it was the private cloud guy, that was the solution. If it was the public cloud guy, that was the solution. But that's not what you want to do. You want to find out what the problem is. So, you know. You compete with each other. Everybody's competing with each other internally. Yeah, exactly. And the customer shouldn't care about the internals of the company, right? That's the first thing. And so basically, I went back and looked at all this, did some analysis, met with all the people. And everybody knew what the right thing to do, but it's a question of how do you actually do it? And you know, we put together a plan that said, look, we're going to start consolidating engineering. The first thing we did is we took part of the CloudOS development, which is under software. And George, you know, was kind enough to move that under the cloud organization so we can build a core, right? Then we started working with the private cloud guys that are working on cloud system. He said, okay, you guys can continue doing that, but eventually you got to move to this architecture. At the same time, right, we started working, we pulled in the public cloud group under the same organization because really it's supposed to be the same thing. Now in parallel to all this, we started charting out how we're going to consolidate the sales team and create an overlay sales group. And so over the last 12 months, you know, this is a big company. We've been sort of charting the path that we told you from the beginning, this is what we're going to do. It's just, there's a time for everything. For example, you don't mess around with the sales team during a fiscal year. So we didn't consolidate the sales team until we switched to the new year. Yeah, on November 1st, right? Now in parallel to that, we brought in a lot of talent. Right, one of the things that I wanted to build was a very high level product management team to cover all cloud as opposed to having a solid because at the end of the day, it all comes down to product management. And so I got Bill Hilf, you know, I managed to convince Bill Hilf who was one of the GMs of Azure to come over. And one of the things that sold him is, you know, he agreed that really the open source is going to win. And that was one of the big selling points that Bill, you know, you've been an open source before, you know this is going to win. You want to go do open stuff. So we got that in place. We brought Kerry Bailey to help in the sales. He had done a terror market. And so we slowly built this up, but it all started with us putting a plan and Meg supporting it. And then in June, you know, we went to the board and said, look, we want to increase the investment dramatically. And because we had managed to execute in the sales side, they supported us. Beautiful. That's fantastic execution. And now Martin Fink who came over from HP Labs, also a CU alumni. I think we're going to interview all the execs. Meg, if you're watching this, you're going to come on the CU. I'm going to get Meg Whitman. She's going to come on the CU with us. You know, I was impressed, you know, in knowing about Meg Whitman, she's not a super technical person, although she's, you know, super smart about where the action is. Got a lot of good guys around. You're one of them. George Kadifa, you mentioned a bunch of other guys. You're a good team. So not surprising the investment. So let's talk about the investment. So Martin Fink comes in. He kind of takes over to look over the store. He's going to really be doing a lot of lab stuff. That's a good thing. More investment. Meg talked about that. What's the big going forward piece? And I want to get your perspective on OpenStack. I want to, you know, get it here. Are you guys still committed to OpenStack? And are you going to be the key anchor? Linux had IBM. They put a billion dollars down. Right now, OpenStack needs a leader. Will that, is that going to be HP? So let me put it this way. We're all in an OpenStack. We were supporting OpenStack from day one. And, you know, so far we've been proven to be correct. You know, I'm not going to show our hands, but I would just say that the level of investment that we're putting in is going to surprise people. Surprise people dramatically. And not everything that we're doing is clear yet, but it will become clearer over time. And when I mean over time, I mean in the next 12 months, not in the next 12 years, because cloud is a monthly thing, not a yearly thing. Now, you know, I think what's really important in OpenStack right now is to move from a developer focus to a customer focus. Yeah, customers that I talk to, and we hear from, talk about flexibility. It's the number one thing they need. And they want OpenStack to be that forum. Right now, OpenStack to us seems a little lost. We need, it's a headless leader. I know RackSpace is in there. Love you over there RackSpace. You know we love you. But you don't have the mojo on the software side. They're hardware guys. I know HP is too, but they're hosting guys. IBM really made Linux work. There's a lot of other market forces up there. That's a marketing perspective that I great so. Well, HP was kind of forcing them with HP UX on the other side. We were the first people to indemnify Linux. This is to be record, right? Martin Faith, thank you very much. And Son on the other side too. Well, I was there, I haven't witnessed that whole movement. But those are the forces going on. Obviously, you know, the open source was under threat, so Linux had to come together. OpenStack is under the same thing. There's a lot of solidarity in OpenStack right now. And Amazon is clearly washing into the enterprise. That wave is coming in. We're at reinvent and you're hearing things like VDI, Kinesis, Redshift. These are compelling integrated stack technologies. And the enterprises will do stuff with Amazon. How deep Amazon will go into the enterprise? That's still going to be a question. So that's a force that, you know, I think it's going to accelerate the OpenStack piece a bit, don't you? I think, look, first of all, I think the fact that, you know, Cloud now is under Martin Fink, should be very telling to anybody who's trying to read the tea leaves, because Martin Fink, right, has a long history in open source and Linux. You know, he literally wrote the book on open source. So, you know, that's what gives some people some indication of where our heads at. Making one of the top people in the industry and putting him in charge, you know, putting Cloud underneath them. So I think that should be a good indication. You know, look, Amazon, all the power to them, I think they've done a great job in the first wave of Cloud, but the first wave of Cloud is a small wave considered the rest of the waves are coming. And, you know, the problem is this, right? If you look at all of Amazon's investment, there are more people working on OpenStack than Amazon. So, Amazon may be ahead, but if you look at the curve, I'd look at our slope is better. And, you know, Solaris was really good too, but then one morning, Linux came along and while it took a while for Linux to go over Solaris today, nobody even talks about it that way. And the one thing that I think is really interesting is I think OpenStack is doing, in a few years, what it took a decade for Linux to do. Now, you know, there's a lot of things we still got to do, but when I talk to customers today, it's amazing compared to last year, people were interested, everybody's piloting something. Everybody knows they're piloting, they understand. It's got a lot of white space and people are excited. I mean, first of all, we cover OpenStack, some of the CUBE, you know, we were there last year, we're going to continue to be there. But I want to get your take on this first wave and the second waves and the bigger waves are coming. The guys that are surfing the waves are developers and applications in the enterprise. Obviously, the enterprise is a completely different set of surfers, if you will, surfing those waves, workload requirements, compliance. What's your vision of that? Okay, by the way, no disagreement, open source wins, it's about freedom, and that's what it's all about, not just free, freedom to quote George Kadifa. What are those apps look like? What's your, how do you see around the corner there? What's coming next for those developers? If wave one was Amazon, and as you said, it's small. Wave one was low-hanging fruit, okay? It's low-hanging fruit, which is things that are very easy to move to cloud in terms of their, it's a good fit. The SLA requirements are not as significant. The security requirements are not significant. There's always the first wave, and again, I think it's great. But if you look at the entire, you know, again, average enterprise, 5,000 apps, how many are actually running on a public cloud? I think the second wave is hybrid. And you know, I know they're shocked that I'm saying that, but you know, we've been- Who's shocked? Yeah, I'm kidding. I know it's shocking that I say that, but I think the second wave is hybrid because it's a good thing that's been happening over the last years. People realize, look, it's not about this versus that. It's about being able to do both. Okay. So let's talk about DevOps 2.0, because really at the end of the day, that's where it's going, right? DevOps was, to me, Amazon. A lot of guys who do DevOps love Amazon, especially the developers. But when you get to see more things like Facebook, and we're going to hear Facebook come on stage shortly with George Kadeev as keynote, you know, talking about Vertica's and the success they've had with HP and HP Cloud, the DevOps 2.0 is the enterprise. Correct. Where it's easier and more available. But is that, what's your take on that? DevOps 2.0? That's a pretty big wave, I mean. I think when you, I mean, the interesting thing about DevOps is like cloud, right? Everyone's talking about it, but you know. You know, it's like certain things that people had in high school, right? Everyone's talking about the things someone else is doing. I think DevOps, look. Teenage sex is the quote. You said I didn't, but now you've been through it. I think, look, the good news is, I think that it's all about agility. And so DevOps makes sense to get to agility. You know, we talked about this in one of my keynote here in terms of, you know, if you're running, if it takes you eight months to figure out if what you're building is correct or not, that's probably not a cloud agility, right? You're iterating. DevOps is all about iterating. And I think that the enterprise is starting to adopt that, but it's going to take time because DevOps itself will have to change to make that work. Well, I would agree with you. And in fact, I would say, well, Dave and I's definition of DevOps is guys who eat glass and spit out nails. So let's talk about Facebook, for instance. Developers that have more developers to admin ratios. You know, they might be hosting on bare metal. So the enterprise, that's a unique brand. Hyperscale, that's a small black swan kind of market. So I totally agree with that. So DevOps 2.0, let me call it cloud ops. Maybe it's enterprise, guys who want to be Superman. I want to be a DevOps when I grow up. I mean, I talk to people in the enterprise, it's not a lot of DevOps qualified people. They're mostly guys, I run the DBA for Oracle. I do this admin for NetApp gear. I do this over here for email on EMC Symetrics. I got my HP 3.0 over here and I got my servers over here. You know what I'm saying? Now it's coming to DevOps, to me, means how do you make those guys more productive for the programmers, the software developers? Well, I think, again, a lot of those guys you just talked about are working in an ITIL shops. Okay, so if you're working in an ITIL shop, it's very regimented and that's fine and that's good for the old world and there's nothing wrong with the old world. It's just that the new apps are not going to be written in the old world because it's too slow. So when you look at DevOps, you know, you're going to see the emergence of this in the new world and there's going to be a migration over time, you know, because anyone who's building new apps doesn't have that. That's a multi-year journey. You want to agree? Five years? I think that it's a three to five year journey but I think that- From ITIL to new? It's not so much a journey in terms of it's going to be a balance. Over time, more and more is going to be here and I think the ITIL stuff will still be around but there won't be any big development happening there. So the question is, where's development going to be? The development's going to be in the new area. The older is still going to be there but over time, percentage-wise, there'll be a lot less happening there. And that's okay because like I said, I mean the difference in enterprise is enterprise has installed base, right? That's the difference in consumer and enterprise. You can't just all say, you know what? Everything that happened before doesn't matter anymore. That's not how enterprise works. And so that's one of the reasons we support hybrid and the same is going to happen in DevOps. You're going to have leakage of DevOps concepts through new apps and over time DevOps will adopt it. You know, I think one of the things that I think is very interesting if you look at how Google does it, right? Google have a separate team called SREs who are actually doing that. And I think that's a really interesting concept. I think some of what that they're doing over there is going to leak into the enterprise because I don't know that every designer, right, wants to be doing the ops part. And I don't know how it scales in enterprise. So I think, you know, there's a lot to be, I mean, it's early. What's your critical success factors this year? And you're now, you're running the business unit for cloud globally, which is the engineering, product management, go to market, market development. I go to market, engineering, product management, and go to markets under carry. Oh my God, because I have big expectations for that. So, but some, you must have some product marketing, market development. No, product marketing, but it doesn't matter. Me and Kerry are partners. So I'm responsible for the sales as well in terms of we have to deliver a number. So you're running the product requirements. So you're running the PRDs, your team, right? So Kerry sells the product. Yes. She sells it. And he has everything he needs to be successful. What are your goals for the next six months? As I mentioned to you before, right, we have two goals. I can't get into revenue goals, but we obviously have very high growth goals in terms of just overall and also in terms of hybrid. But, you know, we intend to make OpenStack much more dominant in the industry, and that's going to help everybody, and we intend to be part of it. And so just the maturity of OpenStack in the industry is a big goal for HPE because it's going to benefit us and others as well. I mean, you guys don't get the props. You and I both talked about that OpenStack summit. You guys don't get the props. You guys were founding members of OpenStack, a big part of funding it, contributing resources, going back to incorporation. Yeah. And we're still running to see ICD chain for all, right? It was Monty Taylor. We're still doing that. And look, the way I would tell, this is what I would leave you to think about in terms of OpenStack. In the cloud, and we talked about this in the past, right? You're going to make money in many different places. If there's companies you think they're going to make all their money in OpenStack, and only there, I think they're going to have a business model problem against HPE. So good luck with that. So, great to have you on theCUBE. Obviously, I know your time's tight. We got the keynote to go on George Kadeev and coming up with some special presentation. Facebook's going to come out. It's going to be fantastic. Final question, true or false? The HPE cloud is built on OpenStack. Absolutely. That's true. Absolutely true. 100%, 100%. Absolutely. Okay. All right. I just want to get down the record because it's been kicked around from multiple people. Great job, great team. You guys are gearing up. Congratulations on going to the board for the big investment. Doubling down on OpenStack is awesome. The community is growing fast. You're seeing VMware making some moves with Mirantis. Got some competition out there. A lot of differentiation going to happen in the next couple of months. One thing on VMware, just let me mention one thing, right? I mean, look, there's a place for VMware. A lot of the customers I talked to saying, look, I have my VMware cloud. I love it, have it. Let's keep it here. Let's build an OpenStack cloud and let's move things over time. And that's fine. That's good. It's all good. Let me ask you about General Electric. They have the pivotal relationship. Does that affect how you guys look at them? I mean, they'd be a great person to partner with. Certainly, they have all that medical equipment, which is in the heritage of HP. I think, look, I think the past area is very interesting. I think one of the questions, and we do work with Cloud Foundry. We have our stuff there. But I think the question is, are we at the level and past yet relative to where there's a dominant solution or there's going to be a bunch of different ones? I don't think yet we're in a place where there's going to be a dominant one. So I think there's going to be a bunch of different ones and they're going to be somewhat verticalized, so on. So I think, you know, pivotal, I think they're doing some interesting things. I think we're going to be seeing some really interesting developments and paths over the next year. Well, we're excited to have you on theCUBE and as a friend of theCUBE, we'll always keep in touch and keep you up to date on what we're doing and also hear from you and what's happened to Cloud. Great to see HP making their breakout moves, a year of execution under your leadership. Congratulations. Can't wait to hear about the OpenStack news. Make sure you get to us before you break it so we can get out front. Of course, we'll see you at OpenStack Summit. Did you go to Singapore? I mean, Hong Kong? We couldn't make that one. I was in Hong Kong. Give us a quick two seconds on what happened there. What was that? Oh no, look, the big news is, again, a lot more discussion about customers and a lot less discussion about technology and that's important because as, you know, the end of the day, OpenStack's success is going to be defined by applications, workloads, people using it. That's what's going to define the success, right? And I think we can see already in Hong Kong you can see the shift to that. So it looks like we crossed the chasm of Cloud, what do you think, finally here? I believe so. We'd love to talk. Cloud washing is gone. Now it's Suffer to Find data center washing. This is the year for that. Cloud's reality. Congratulations. You know my pets versus cattle analogy, right? No, no, share it. Virtualization, right? The way you know if you have a real cloud, if you have servers that have names, so if a server goes down, you take care of it, that's like a pet, right? Because it's a phyto, you have a name. If you have servers that are like a herd of cattle, right? Just a herd supplying resources, that's Cloud. I would argue you and VMware, they cater to pets and I think a lot of applications are running on pets. That's okay. Hey, look at GeoPets, very popular around the holidays, you know? Sar, great to have you on theCUBE. Good luck and we'll be talking. This is theCUBE live from Barcelona, Spain. This is HP Discover Exclusive Silicon Angle we keep on theCUBE. We'll be right back with our next guest after the keynote with George Kedifa and Vertica.