 The rapid rise of ransomware attacks has added yet another challenge that business technology executives have to worry about these days. Cloud storage, immutability, and air gaps have become a must-have arrows in the quiver of organizations' data protection strategies. But the important reality that practitioners have embraced is data protection, it can't be an afterthought or a bolt on, it has to be designed into the operational workflow of technology systems. The problem is oftentimes data protection is complicated with a variety of different products, services, software components, and storage formats. This is why object storage is moving to the forefront of data protection use cases because it's simpler and less expensive. The put data, get data syntax has always been alluring, but object storage historically was seen as this low-cost niche solution that couldn't offer the performance required for demanding workloads, forcing customers to make hard trade-offs between cost and performance, that has changed. The ascendancy of cloud storage generally in the S3 format specifically has catapulted object storage to become a first-class citizen in a mainstream technology. Moreover, innovative companies have invested to bring object storage performance to parity with other storage formats. But cloud costs are often a barrier for many companies as the monthly cloud bill and egress fees in particular steadily climb. Welcome to Secure Storage Hot Takes. My name is Dave Vellante and I'll be your host of the program today. Where we introduce our community to Wasabi, a company that is purpose-built to solve this specific problem with what it claims to be the most cost-effective and secure solution on the market. We have three segments today to dig into these issues. First up is David Friend, the well-known entrepreneur who co-founded Carbonite and now Wasabi. We'll then dig into the product with Drew Schlesel of Wasabi and then we'll bring in the customer perspective with Kevin Warrenda of the Hotchkiss Cool. Let's get right into it. We're here with David Friend, the president and CEO and co-founder of Wasabi, the hot storage company. David, welcome to theCUBE. Thanks, Dave. Nice to be here. Great to have you. So look, you hit a home run with Carbonite back when building a unicorn was a lot more rare than it has been in the last few years. Why did you start Wasabi? Well, when I was still CEO of Wasabi, my genius co-founder, Jeff Flowers, and our chief architect came to me and said, you know, when we started this company, a state-of-the-art disk drive was probably 500 gigabytes. And now we're looking at eight terabyte, 16 terabyte, 20 terabyte, even 100 terabyte drives coming down the road. And sooner or later, the old architectures that were designed around these much smaller disk drives is gonna run out of steam because even though the capacities are getting bigger and bigger, the speed with which you can get data on and off of a hard drive isn't really changing all that much. And Jeff Force saw a day when the architectures of sort of legacy storage like Amazon S3 and so forth was going to become very inefficient and slow. And so he came up with a new highly parallelized architecture. And he said, I wanna go off and see if I can make this work. So I said, you know, good luck, go to it. And they went off and spent about a year and a half in the lab designing and testing this new storage architecture. And when they got it working, I looked at the economics of this and I said, holy cow, we can sell cloud storage for a fraction of the price of Amazon, still make very good gross margins and it will be faster. So this is a whole new generation of object storage that you guys have invented. So I recruited a new CEO for Carbonite and left to found Wasabi because the market for cloud storage is almost infinite. When you look at all the world's data, IDC has these crazy numbers, 120 zettabytes or something like that. And if you look at that as the potential market size storing that data, we're talking trillions of dollars, not billions. And so I said, look, this is a great opportunity. If you look back 10 years, all the world's data was on prem. If you look forward 10 years, most people agree that most of the world's data is going to live in the cloud. We're at the beginning of this migration. We've got an opportunity here to build an enormous company. That's very exciting. I mean, you've always been a trend spotter and I want to get your perspectives on data protection and how it's changed. It's obviously on people's minds with all the ransomware attacks and security breaches but thinking about your experiences and past observations, what's changed in data protection and what's driving the current very high interest in the topic? Well, I think from a data protection standpoint, immutability, the equivalent of the old worm tapes but applied to cloud storage is become core to the backup strategies and disaster recovery strategies for most companies. And if you look at our partners who make backup software like Veeam, Convo, Veritas, ArcServe and so forth, most of them are really taking advantage of mutable cloud storage as a way to protect customer data, customers backups from ransomware. So the ransomware guys are pretty clever and they discovered early on that if someone could do a full restore from their backups, they're never going to pay a ransom. So once they penetrate your system, they get pretty good at sort of watching how you do your backups. And before they encrypt your primary data, they figure out some way to destroy or encrypt your backups as well so that you can't do a full restore from your backups. And that's where immutability comes in. In the old days, you wrote what was called a worm tape, write once, read many. And those could not be overwritten or modified once they were written. And so we said, let's come up with an equivalent of that for the cloud. And it's very tricky software. You know, it involves all kinds of encryption algorithms and blockchain and this kind of stuff. But you know, the net result is if you store your backups in immutable buckets in a product like Wasabi, you can't alter it or delete it for some period of time. So you could put a timer on it, say a year or six months or something like that. Once that date is written, you know, there's no way you can go in and change it, modify it or anything like that, including even Wasabi's engineers. So David, I want to ask you about data sovereignty. It's obviously a big deal. I mean, especially for companies with a presence overseas, but which really is any digital business these days. How should companies think about approaching data sovereignty? Is it just large firms that should be worried about this? Should everybody be concerned? What's your point of view? Well, all around the world, countries are imposing data sovereignty laws. And if you're in the storage business like we are, if you don't have physical data storage in country, you're probably not going to get most of the business. You know, since Christmas, we've built data centers in Toronto, London, Frankfurt, Paris, Sydney, Singapore, and I've probably forgotten one or two. But the reason we do that is twofold. One is, you know, if you're closer to the customer, you're going to get better response time, lower latency, and that's just a speed of light issue. But the bigger issue is, if you've got financial data, if you have healthcare data, if you have data relating to security like surveillance videos and things of that sort, most countries are saying that data has to be stored in country. So you can't send it across borders to some other place. And if your business operates in multiple countries, you know, dealing with data sovereignty is going to become an increasingly important problem. So in May of 2018, that's when the fines associated with violating GDPR went into effect. And GDPR was like this mainspring of privacy and data protection laws. And we've seen it spawn other public policy, things like the CCPA and it continues to evolve. We see judgments in Europe against big tech and this tech lash that's in the news in the US and the elimination of third party cookies. What does this all mean for data protection in the 2020s? Well, you know, every region and every country, you know, has their own idea of about privacy, about security, about the use of, even the use of metadata surrounding, you know, customer data and things of this sort. So, you know, it's getting to be increasingly complicated because GDPR for example, imposes different standards from the kind of privacy standards that we have here in the US. Canada has a somewhat different set of data sovereignty issues and privacy issues. So it's getting to be an increasingly complex, you know, mosaic of rules and regulations around the world. And this makes it even more difficult for enterprises to run their own, you know, infrastructure because companies like Wasabi, where we have physical data centers in all kinds of different markets around the world. And we've already dealt with the business of how to meet the requirements of GDPR and how to meet the requirements of some of the countries in Asia and so forth. You know, rather than an enterprise doing that just for themselves, if you running your applications or keeping your data in the cloud, you know, now a company like Wasabi with, you know, 34,000 customers, we can go to all the trouble of meeting these local requirements on behalf of our entire customer base. And that's a lot more efficient and a lot more cost effective than if each individual country has to go deal with the local regulatory authorities. Yeah, it's compliance by design, not by chance. Okay, let's zoom out for the final question, David. You're thinking about the discussion that we've had around ransomware and data protection and regulations. What does it mean for a business's operational strategy and how do you think organizations will need to adapt in the coming years? Well, you know, I think there are a lot of forces driving companies to the cloud. And you know, and I do believe that if you come back five or 10 years from now, you're gonna see a majority of the world's data is gonna be living in the cloud. And I think storage, data storage is gonna be a commodity, much like electricity or bandwidth. And it's gonna be done right. It will comply with the local regulations. It'll be fast, it'll be local. And there will be no strategic advantage that I can think of for somebody to stand up and run their own storage, especially considering the cost differential. You know, the most analysts think that the full all-in cost of running your own storage is in the 20 to 40 terabytes per month range. Whereas, you know, if you migrate your data to the cloud, like Wasabi, you're talking probably $6 a month. And so I think people are learning how to are learning how to deal with the idea of an architecture that involves storing your data in the cloud as opposed to, you know, storing your data locally. Wow, that's like a 6x more expensive in the clouds, more than 6x. Yeah. All right, thank you, David. Go get it, please. In addition to which, you know, just finding the people to babysit this kind of equipment has become nearly impossible today. Well, and with the focus on digital business, you don't want to be wasting your time with that kind of heavy lifting. David, thanks so much for coming on theCUBE, great Boston entrepreneur. We've followed your career for a long time and looking forward to the future. Thank you. Okay, in a moment, Drew Schlessel will join me and we're going to dig more into product. You're watching theCUBE, the leader in enterprise and emerging tech coverage. Keep it right there.