 Live from New York, it's The Cube, covering Riverbed Disrupt, brought to you by Riverbed. Now, here are your hosts, Dave Vellante and Stu Miniman. Welcome to New York City, everybody. This is The Cube and we're here with a special presentation of Riverbed's Disrupt Conference. It's hashtag Riverbed and Stu Miniman and I will be covering this event all afternoon. We're starting at 12 noon sharp here and it will be going until well into the evening with a number of guests. We've got some folks from Microsoft coming on, Palo Alto Networks, senior executives at Riverbed. We've got some customers coming on from Hertz and Shell and we're really excited to be covering this transformation from what an industry that Riverbed really popularized to in wide area networking and it's now, of course, with the cloud and software defined as really shifting Riverbed as a company that rose very rapidly. It's ascendancy, they soared to a billion dollars as a public company, they were the hot stock and they kind of hit a wall. They were in that sort of wide area networking niche, wind optimization niche and then began to sort of diversify, cut cost and get acquisitive. Wall Street didn't like that, they ended up going private but they had a three plus, well over three billion dollar valuation, extremely successful company but, of course, Wall Street is kind of impatient, gone private and now we're in the process of many companies that we see doing that, of retooling. So, welcome to New York City, it's great to be working with you. Thanks Dave, great to be here with you. Love being here in New York City, we're just a block or so away from Woodworld Trade Center, the Freedom Tower, gorgeous weather down here and yeah, they started off, Riverbed's been around for 14 years, same co-founder Jerry Cannelly, still the CEO, been with them since, before cloud was something we talked about but Dave, we've talked many times about how networking can really be a choke point for a lot of the technology we've been talking to. You think back to the 90s, the XSPs, one of the reasons they failed was just networking couldn't allow me to put my data, put my applications far away from where I am and if you talk about mobility, you talk about kind of the digital transformation that companies are going through, being able to reach my application, to have the performance and not, I shouldn't have to worry about where my data is and where my people are and of course, that requires a lot of complexity and a lot of moving pieces on the network and Riverbed feels that they are in the best location to solve that problem, thinks that we need a redo in networking. Of course, networking's been dominated by Cisco for such a long time, so many pieces here. This whole transformation from kind of Wayne Optimization to SD-Wayne is something I'm excited to dig into with the practitioners, the Riverbed people and their partners here throughout the day. What does the company's made its haste to on faking out the speed of light and just sort of optimizing network traffic and to your point, the bottleneck, the source of the bottleneck is changing. It is shifting, it used to be the spinning disk, now with flash doors, it's getting pushed out to the network and the network, your wheelhouse is sort of the new choke point and what's happening, we always talk about traffic moving from North-South to East-West, the flattening of the network and here's a company that really, I mean, has done a really good job of competing with Cisco. I mean, it's one of the few companies that has been very, very successful against Cisco, 50-plus percent market share, I'm sure it's a leader in the magic coordinates from Gartner but now has to shift into this area of application performance management and visibility, branch networking, whole new ball game. What are the synergies between the core, fundamental products that this business has been built on and these new adjacencies in your opinion? Yes, so Dave, I was talking to some of my peers here and say, why won't Cisco just dominate this market like they have so much of networking and if you look at the individual components, Cisco's got a lot of them, Cisco's made big acquisitions, they've done their own development and what you heard in the keynotes this morning is Riverbed saying, we've got all of these pieces, you need branch, you need cloud, I need to understand, way in optimization, still critically important because bandwidth costs have come down but I need to be able to shrink that pipe and I need to be able to understand the applications as well as be able to orchestrate across all of these various pieces and things are moving and changing all the time and it's not something that I can have some admins sitting there, it's not like somebody calls and says, hey, I'm going to access my application, let me call IT and let them know that hey, I've flown across the country. No, I just access it and hope that I can get to my data and so it can't be manual, it can't be somebody tapping away at a CLI on a single device, I need to have more holistic solutions that span that and that's the whole steel families that Riverbed has throughout their product line and the other thing, Dave, I know you're going to be digging into, we've talked a lot about companies going private, here's Riverbed, a company that was a public company done really well, it's gone private, it's divested itself of a couple of pieces, it sold a traffic manager to Brocade, it sold a cloud storage appliance to NetApp and it's made a couple of acquisitions which are critical to how they're moving forward. It was an eternity on the end user experience and Oceto was a German company that's part of the SD-WAN pieces, so really internally retooling, rejiggering, making the company move forward and we'll see if they're going to IPO again sometime in the future now that they believe they're positioned and targeted for a market, Dave, that people are saying it will be billions of dollars soon, but in 2015, I haven't seen anybody that actually has a concrete number on the SD-WAN space, but it's definitely less than a billion dollars and it's growing and exciting, there's startups and a lot of people are working here, but it's still something that is really very nascent today. So steel is the rubric, the sort of syntax that's used, Steelhead is sort of the flagship sort of announcement product, going back to 2002 to 2004 as the company started in 2002, really to attack latency and then Steel Central, Steel Fusion and these are now increasingly acquisitions that they've brought in to provide end-to-end visibility but also software defined WAN at the edge. So that's a whole new opportunity for them and they really heard a lot of talk this morning about the branch, the branch office. Branches are different, they need connectivity, they need access, some of them are hybrid, some of them are pure plays, some of them are stateless. So lay out the portfolio as you understand it, we'll get into it with guests, but give us the high level lay of the land. Sure Dave, so starting with you said it was the Steelhead which is their core WAN optimization product, that is the flagship product, it's still core to what they do and it's a component that fits into a lot of pieces. For example, the SD WAN piece is Steel Connect and they're going to merge those together and you can actually buy it as software which I can spin that up in the cloud. Like we've seen, Dave in storage, all of these things, it's a physical appliance but I can also make it virtual and if I can have it virtual as software, can I put it in the cloud? Microsoft we're going to have here talking about what they do with Azure, they also partner with AWS and they've got a partnership with IBM on software and thousands of service providers that they're working with to be able to tie into these environments. So start with Steelhead, the Steel Connect is the SD WAN piece, Steel Fusion is an edge device, they call it actually Hyperconverge which is a little bit different from kind of the VMware vSAN Nutanix type pieces but it is compute storage and network all put together for certain applications, either networking services, file and print, or it can be business applications that I want to have at the edge. And then- It's lightweight storage, right? It's not Nutanix. It's 100 terabytes and it's not the highly scalable, flexible, I'm not going to be putting dozens of nodes, this is a box that I want to have at that branch location because as we know, as we look at IoT in certain environments, there's certain applications that there's that data gravity at the edge and there's some stuff that I need to move to the core. They've also got their orchestration and management tools, some of the rest of the Steel central pieces. So yeah, a lot of terminologies in the portfolio, all of them are Steel. We've got some of the general managers for those groups that are going to help us dig into it. But what you like to hear is things like how they're working in cloud environments, customers that we talk to, they're doing SaaS, they're doing public cloud and they're keeping stuff on-prem and networking has to be that, interconnecting fibers or inter-clouding. We actually spent a lot of time last week or two ago at VMworld talking about how VMware's doing NSX, VMware doesn't really have nearly the branch networking that Riverbed does, but everybody in the network space is tackling this problem of just multiple environments from on-prem to public cloud and SaaS and how do I manage applications between them? So Riverbed's in a hot area. So the big competitor obviously is Cisco, but VMware and Cisco are competing. So obviously VMware is a form of competition with NSX. And then of course, you've got Juniper, obviously high-end cloud service providers, but as well as Arista. So- And Arista doesn't do the way in so much, but even Dave, Microsoft's here as a partner, Amazon's a partner, but how much as these become software, do those giant cloud providers bake some of it into the environment? We know that Microsoft has a much stronger hybrid push than Amazon does, but as it turns into software, these lines all blur. Well, you saw that happen with the local area network. Will it happen again with the wide area network? Why or why not? So in what way? In terms of these large clouds of providers, usurping that functionality and bringing it into their own sets of services. Yeah, so I mean, the space that Riverbed plays in, I think they've got their differentiating, they've got their IP built-in years of doing this. They maintain differentiation. And I think there's a strong play for them going forward. Yeah, so there's companies, private companies, since they've gone private, they've actually grown, at least according to reports that we've had, and they're restructuring, I shouldn't even say that restructuring, what they've done is they've shed some non-strategic assets and they've acquired many others, and they're doing that without the shining, bright light of Wall Street, so they're able to do that at their own pace, write their own narrative, and they're readying ostensibly for another IPO. That's not the only option, but it's interesting, due private equity these days, it used to just be about sucking all the cash out of the company and then whatever's left, throwing the carcass to whomever wanted it. Now it's about the long game, investing in these companies, acquiring companies, and really restructuring them for longer-term growth so they can have larger exits. And it's a really interesting play on the private equity market. They've identified undervalued tech companies. We've seen, obviously Dell gone private, now EMC gone private, BMC gone private, CLIC is going private, which has also taken private, I believe by Tomor Bravo, the same private equity firm that partnered up with Riverbed, of course, Riverbed. So it's a big trend, public markets aren't so attractive anymore, but they're making the bet that they will come back as a source of exit. Yeah, Dave, so we're not far from Wall Street, we need the update, it's no longer Gordon Gekko buying something, selling off all the pieces. It's been a really interesting narrative to watch. It was Riverbed, Dell, Rackspace, all of these companies that are going private and retooling and moving forward and being successful. Why let the VCs have all the fun? Okay, keep it right there, everybody. This is theCUBE, we're live from New York City. We'll be right back after this short break. My name is Dave Vellante.