 From around the globe, it's theCUBE with digital coverage of VMworld 2020 brought to you by VMware and its ecosystem partners. Hi, everybody, welcome back. This is theCUBE's coverage of VMworld 2020, of course. It's remote coverage, virtual VMworld 2020. Dennis Cannelli is here. He's the newly minted General Manager of IBM Storage. Dennis, thanks so much for spending some time with us and congratulations. Thank you, Dennis, great to be here and great to talk. Yeah, so you're 30 days in, you know, so you're an expert by now, but of course, a long-time IBMer and you've touched a lot of different bases at IBM. So that's very exciting. And but your background is in engineering and products, which I think is significant. And I want to talk about that a little bit, but you've got expertise in cloud, hybrid cloud. You were in the security division for quite a bit of time. I actually spent some time in data management as well. So why do you feel as though this is a great opportunity for you and of course for IBM given your background? Yeah, I think, as you say, I'm a technologist, I'm a product guy for many, many years, almost 30 years in the business. I came to IBM as a lot of people through an acquisition of a small company in the networking space. But since then, I've had two or three careers at IBM where I work in security. I worked in hybrid cloud. And actually, way way back, I worked for EMC in the storage business. Right now, as you look at hybrid cloud, we're in this hybrid multi-cloud world, I think, and again, that ties into what VMware is also talking about. I think we're the two vendors in the market that are really pushing and focused on that strategy. And the reality is of clouds, if you look at cloud today and where the world is, even though we're 10, 15 years into the cloud business, it's 15 years since the first hyperscaler was launched, reality is about 20, 25% of what I would call enterprise workload have actually moved out of the cloud. And there are many reasons for that, be it security, compliance, data privacy, et cetera, transformation, a lot of people challenges, et cetera. But now we are actually right in the cusp of attacking that enterprise workload. And storage is a critical role to play in that, especially in that hybrid multi-cloud world. And I'm really making sure that storage is a key neighbor on that journey. And that's why I think it's a critical time right now to be in storage and to help on that journey. And I want to come back to that and talk a little bit about it. But one of the things that I'm excited about in terms of your background, you've got a strong product background. And for years, I had indicated that IBM sort of, for a while lost its formula in storage. You'd do all this R&D and it never hit the market. And then under your predecessor, I think IBM's done a much, much better job. And you see it in your business now. Last couple of quarters have been really strong for you guys. Of course, you've got the mainframe attached, which is the gift that keeps on giving. But how are you looking at your business? Again, I know you're only 30 days in, but there's been some tailwinds lately. And you guys have seemed to do pretty well relative to the market. Yeah, my predecessor and I have done a fantastic job. I mean, if you look at our core storage business, as you said, Dave, like our mainframe, that's always our flagship. And we continue to innovate there, particularly around the mainframe, things like copy services, et cetera, where we're driving a lot of innovation and continue to lead there. But I think the more interesting and the really exciting part is what we've done in our, what I would call our open system storage, our flash lineup, where the team had got to a single code base and a single hardware platform, and we can scale right up and down the stack. I'm really innovating and driving very quickly there as a critical part of what I'm driving right now and accelerate the work that has been done today. Then I think beyond the core storage platforms, if you start to look at some of the other areas like cyber resiliency, data protection, I'm really driving innovation there, but also leveraging other parts of IBM. I mean, we have a very strong base in security. I'm working very closely with our security teams because I know from my days in security, data protection, data recovery, real challenges for DeCiso and bringing those technologies and packaging those technologies so that they can help in those challenges, critical to me. And last but not least, I mean, as you look at things like data in AI and bringing AI to the enterprise, one of the big challenges is being able to identify where all the data is and be getting access to the data. And again, storage is a critical role that they play there in terms of discovery services, et cetera, which again is a key innovation area. So I think it comes down to those three things, making sure, obviously you need a very strong product line up, which I think we are very well equipped right now and we have based on the work the team have done over the last number of years, but then applying that to some of the critical problems around cyber resiliency, data protection, and also leveraging and enabling AI in the enterprise. So let's stay on cyber for a minute. It's an area obviously you know a lot about and you used to think, okay, what's the relationship between storage and cyber? And it was maybe it was encryption and data at motion or data at rest. And now the lines between data protection and cyber are really getting blurred. I mean, it's become, it was especially with COVID. It's become a fundamental part of business resiliency. So how are you thinking about storage in the intersection of cyber? Yeah, I mean, I think, you know, when I had my security hat on, I mean, the reality in security is, you know, the world is, you know, how you deal with a breach because at the end of the day, pretty much it's, there is going to be a security event. Is that a case of if it's a case of when it happens? And, you know, really how you respond to that. And that was where, you know, a lot of our focus was in terms of how you respond to those events, how you can recover quickly, et cetera. Now, when you come across into storage, I mean, really in the world we live in today, where, you know, where at the end of the day when there's a cyber attack, I mean, what is it that the various actor is after? They're pretty much after your data assets and, you know, things like ransomware and all these various different techniques. But how quickly you can respond and recover from those is really important. And that's where storage is a critical role to play. And a lot of what we are doing in the innovations, of course, things like base encryption and encryption everywhere, their capital stakes as far as IBM is concerned. We've had that for many years in our mainframe and our open systems. But now really thinking about how you actually recover very quickly when an event happens. And that's really where we see a lot of innovation and where we want to talk to both sides of the house, both the storage, I mean, but also on the CISO who have, frankly, a big influence in terms of where investment dollars are put today and making sure that they have the capability to actually recover quickly when there is an attack. Well, and as you well know, for years, it was, you know, security was the problem of the, you know, the SecOps team, you know, not my swim lane, but that has really changed. I mean, security has become a board level issue. Everybody's got to be involved. We're seeing more CISOs reporting into the CIO. We're also seeing CISOs have a seat at the table. They're reporting, you know, at quarterly board meetings. And so we see every part of the IT stack really focused on security and even the lines of business as well. What are you seeing? Yeah, exactly. I mean, I think the CISO role has evolved over the last number of years. I mean, I think if I think back, you know, maybe five, 10 years ago, the CISO role was very much what I would call a compliance type role. So in other words, making sure we had all the checks and balances in place that, you know, at the right time. But in the fast-pacing changing world of cloud and transformation and digital transformation, the CISO has to be an active part of that. We used to use the expression that the CISO was the Dr. No. In other words, you've got how to stop, you know, innovation and how to stop things changing. That's, you know, yesterday as there was today, the CISO has to be much more proactive helping technology, helping transformation. And that's why you're seeing that they have a seat at the top table right now because they are critical to all decisions that are made. The fact is that, you know, massive transformation is happening in every enterprise. But you got to do that in a secure and safe manner. And the CISO is absolutely critical to that and is influencing a lot of buying decisions around that as well. And by that, we see that as a critical part of our strategy that we make sure that we have offerings and capabilities that are addressed as that needs. I'd love to come back to the cloud discussion, the hybrid cloud and the multi-cloud. You mentioned that early on. You guys obviously have a big play there with Red Hat and OpenShift. We've seen in our data that that is becoming real. Multi-cloud kind of used to be, you know, a lot of vendor talk, but now it's becoming a fundamental strategy. So you were saying, you know, a smaller portion of workloads, you know, are in the cloud. It's all the hard stuff has stayed on prem. What's the motivation for your customers to move to a cloud or a hybrid cloud strategy? What are they trying to achieve as an outcome? Well, I think that with everything, you know, you got to start at a business level, right? I mean, fundamentally what enterprises are doing is, especially in this COVID world, everything is becoming increasingly digital, going online, et cetera. So that transformation is accelerating, that digital transformation and the rate and pace of that is accelerating. Now you actually start to think about that and say, what does that mean in terms of, you know, existing enterprise? In many cases, you know, especially for incumbents, right? You know, they have existing systems, they have existing data repositories, et cetera. So how do they leverage that and transform those to meet these new needs? And then of course, back to the cyber concerns, right? You have security, data privacy concerns, et cetera. So you have all these multiple variables going on. In our world, you know, and if you look at what has happened over the last, you know, as I said, 15 plus years, you know, everybody said, you know, everything is moving to a public cloud game over, we're done, right? That hasn't actually happened. We really are in a multi-cloud world. And when we talk about multi-cloud, that means, you know, you have the, what we refer to as a traditional hyperscalers, but also the SaaS properties, et cetera, that we see in every enterprise. And also you have to have on-premise capability, but it's different than what it was traditionally. It has to have cloud-like economics. What has been very good about the cloud and a tremendous innovation is the elastic scaling, et cetera, and the economics that has come with the cloud. But you have to bring that back on-premise. You can't just have one operating model in the cloud and have something else on-premise. Your infrastructure has to be flexible and scalable across both environments. And that is the true definition of what we call a hybrid multi-cloud. And one of the critical technologies that gives you that consistency across that, and one of the reasons why, you know, we made the strategic better in redhead is containers. Because from a number of years back, we could see that was the portable technology that enabled a lot of this hybrid multi-cloud capability. IBM talked about hybrid cloud long before it was a popular thing to talk about a number of years back. But we could see that, you know, to enable that to happen, the critical technology was containers and that because both a combination of containers and Linux, and hence the acquisition of Red Hat. And now we are actually leveraging that to actually drive footprint across that hybrid cloud environment. And everything we're doing is integrating into that container technology, including storage. Yeah, well, of course we're here at VMworld again virtually, but the big trends we're hearing from VMware and the ecosystem this week, they're pounding on networking hybrid multi-cloud as we've just talked about. You mentioned containers and Kubernetes. We're hearing a lot about security, which we just addressed, AI, ML. Thinking about the points of commonality. I mean, you guys are big partners with VMworld, VMware have been for many, many years. A lot of open shift runs on VMware. We know that. A lot of, you know, business critical and mission critical workloads. So what are those points of commonality and maybe what are some of the points of divergence in what you guys are doing as partners? Yeah, I mean, VMware are a tremendous partner of ours. I mean, a lot of VMware and workload as customers move to the cloud, moves to the IBM cloud. We're probably their premier choice right now in terms of VMware workload. Also, I think in terms of, you know, I think if you look at VMware today, I think they also see a hybrid multi-cloud strategy. And I think as the VMware, I would say strategy has evolved over time. Clearly they have a huge install base of virtual machines, which a lot of our container technology and they have runs on top of. But VMware has also evolved into a container approach as well, where a lot of the announcements they've made. So I think we're on a very similar strategy. When it comes to my own area and storage, in terms of how we integrate storage into that container world, there's a lot of commonality in how we approach that. I mean, developing CSI drivers, et cetera, into the container world. I think we're both doing that and doing that together. In areas, obviously we will compete and very much compete. I talked about that product lineup and obviously VMware and obviously their relationship with Dell and others is going to be areas where we will compete in the storage. But in terms of where we really will collaborate, I think is a lot around the hybrid multi-cloud strategy. I'm building an open ecosystem that everybody can play. And where we sit on VMware or they sit on us, I think you're going to see an open ecosystem across this hybrid multi-cloud world. Well, it seems as though from a storage standpoint that you've got no choice but to be open, you have to give clients as much optionality as possible. You can't say, okay, we're going to be all IBM red hat. You've got so many other opportunities for TAM expansion. I wonder if you could talk about that and maybe discuss your philosophy just in terms of openness and its importance in terms of competing in storage. I think that's been fundamental to storage since the very beginning of the storage industry. And of course, absolutely we have to be very open in terms of who we integrate with. And we go everywhere from like optimal containers to virtual machines to any system. All the way is for something as traditional as TIP. Many have said TIP is that TIP is far from dead even in the hyperscale of world, right? Where we're seeing a lot of the hyperscalers right now are actually using TIP technology and integrating TIP into their environment. So there's an example where you might have thought about as something that we do. We do that in a very open fashion and continue to do that. Likewise, when it comes to security, when it comes to things like data and AI, our philosophy is don't take another copy of the data. Be able to access the data so that you can build your AI models, et cetera, on top of that. And we enable that to happen with some of our competitive capabilities around spectrum scale. And we will integrate with back end arrays from EMC, to catch you and others to actually enable that to happen. So we're very open ecosystem, want to bring a unique value. And I'm making sure we can integrate that both up and down the stack. Yeah, well, I mean, you guys, of course, for those who've been around the storage industry as much as I have the SAM volume controller hub was kind of the early days of storage virtualization. I think IBM was clearly one of the leaders there. And you've kind of taken that concept to data. We've seen that with cloud packs. And so, you know, one IBM executive said to me one time, you know, we learned our lesson many, many years ago about the importance of openness and then you got the religion there. So I think it's pretty fundamental, isn't it? It's pretty fundamental, I think, yes. We learned a long, hard lesson many years ago. And I think, you know, when you talk about openness and something like Red Hat, I think we are definitely putting our money in terms of being an open company and really enabling something like Red Hat and continue that ecosystem. As you know, Red Hat has run independent of IBM so that we want to drive that open ecosystem around Red Hat. And that is pretty fundamental to a lot of IBM. A lot of our platforms and our capability, I mean, you know, back from many years, we talked about the SAM volume controller, but even if you go back far enough in history, which I can do in the storage world, the storage API world, IBM was one of the leaders in building an open API around storage and storage access as well back then. So it's fundamental to the company has always been and continues to be. I mean, we're one of the major contributors to things like Linux. That's not well known, but that is the truth. And, you know, things like that were created over many, many years. Yeah, undoubtedly. I mean, I go back to Steve Mills' epic decision to invest a billion dollars in Linux back in the day. And we've seen those billion dollar bets pay off in terms of flash and other areas. Dennis, what's your style going to be? I mean, again, I'm excited that you've got an engineering background. You're a product person at the end of the day. It's all about innovation and getting that R&D out to market. What should we expect from your leadership style? I think you kind of said it, Dave. I mean, I'm an engineer at Hark. I really want to deliver value to our clients. You know, we have a big R&D spend in our storage unit. And I want to show value for that spend that IBM has given me a responsibility to deliver. So to be able to deliver massive innovation and productivity from our engineering team. I mean, that's fundamentally what I do. So starting from day one, understanding our portfolio top to bottom, where our strengths in the market, where our weaknesses, where we need to address some of the gaps. But also listening to our clients, which is very important to me, and making sure that they see the innovation, the quality and the deliverables. And that, you know, as a client or as a customer of IBM, you can be guaranteed that IBM will deliver and continue to deliver on innovation and a roadmap and storage. And that's really fundamental to my philosophy. And making sure that we can establish leadership and continue to establish leadership in the storage industry. So that we are a trusted partner and a valued partner in your transformation journey. So that when you make investments with us as a technology provider, but that we deliver on a roadmap and a vision that actually meets your needs going forward. I mean, that's fundamental to what, you know, my management style is about. And making sure I have the right people that I can put in front of our clients and make sure we can deliver that value. I mean, I think that's critical, Dennis. And again, I keep hitting on your engineering background because, yes, while you have a big, big R&D budget, IBM probably spends $6 billion a year in R&D. You're fighting for that budget with a lot of other divisions at IBM. So staying close to the customer is critical because you've got to place those bets. And I firmly believe that with a strong technical background and product background and staying close to the customer, you're going to have, you know, some big wins and more wins than losses. And you're going to be able to more efficiently deploy that capital in the form of R&D and then quickly get it out into products. I see that as crucial today in terms of the innovation equation. Yeah, I mean, my philosophy, you know, fundamentally, you know, a lot of times that I've been in engineering a long time, it's not about the size of the budget, be it a dollar, be it $10, be it $100, it's how efficient we are with that dollar and how innovative we are with that dollar. And sometimes, you know, you look at IBM and people look at a big company, maybe it doesn't move as quickly. I can guarantee you that, you know, that's fundamental that, you know, you know, I wrote a startup within a small company, within a large company. I'd like to think of it that way and how we can innovate and move very quickly. And that's, you know, fundamental to my philosophy in terms of how I think. It's not about, okay, how can I get more budget to do X? It's how can I be more efficient that I can drive more value? And then, you know, maybe then I get more budget, but you know, you got to think about it that big day of work rather than saying, I don't want to have more inefficiency. I want to have more innovation, more creativity, inferring new markets, looking at new capabilities and be able to just, you know, create new opportunities for IBM storage. Well, Dennis, again, congratulations on the new appointment. We look forward to, at some point in the future, being able to meet face to face, but thanks so much for coming on theCUBE and our coverage of VMworld. Thank you, Dave, and thanks for your time today. I appreciate the conversation. Thank you. All right, you're very welcome. And thank you for watching everybody. This is Dave Vellante for theCUBE. Again, wall-to-wall coverage of VMworld 2020. We'll be right back right after this short break.