 Okay, we're back here live, this is theCUBE, our flagship program. We go out to the events, extract the silver from the noise. This is SiliconANGLE's exclusive coverage of EMC World here in Las Vegas. I'm John Furrier, the founder of SiliconANGLE. I'm joined by my co-host. Hi everybody, I'm Dave Vellante of Wikibon.org. Excuse me. John Taunthad is here. He's the director of marketing and business development at Avnet. John, welcome to theCUBE. Thanks a lot. Great to be here. Appreciate it. You're a very interesting company. You guys are a fantastic brand and very partner-oriented in a lot of places. So, let's start there. Tell us about Avnet. I've always been fascinated by the business model. I watched the ascendancy of Avnet during the early days of the PC and from there you just have transformed the company a number of times and have evolved. So, talk about where you guys are today and that unique business model and why you're so strong in the marketplace. Appreciate that. What, if you sort of think about distribution, it's been an evolution of sort of pick-pack-and-ship and then supply chain. And where Avnet is today is we've moved into solutions distribution. And for us, what solutions distribution means is not only helping our partners deliver solutions to the marketplace, but effectively helping them in a number of different areas, right? So, first and foremost, a services component from a marketing and verticalization approach. We actually spent a fair amount of resources at helping our partners define white space and how to go attack that white space. And then from a product perspective, VSpecs for us is a game changer, right? Because it allows us to bring the full value of our line card to the VSpecs motion and bring out really differentiated solutions. Yeah, so this move toward solutions, what's driving that? Is it just there's so much complexity in IT? Is it the, we got to do more with less, small, mid-sized businesses just don't have the resources? Talk about that a little bit. Yeah, sure. The solutions distribution comment, I think can be addressed at several levels. The first level is how our partners are taking their end solutions out to the marketplace, right? So, it's gone past a point product into a multi-branded, multi-vendor approach. I think overall, the market's driven our partners to do that. From an Avnet context, solutions distribution means that we help our partners deliver solutions in a context where they may not have the existing resources and capabilities to do that. Most of those resources has been helping our partners to define just that white space. How do they bring incremental technologies to the marketplace and find it through a verticalized market approach? So, take us back a year. So, you had this whole converged infrastructure trend. You had certain guys focusing on the infrastructure piece. Other guys like Oracle trying to do the whole stack. And you saw, for instance, Vblock come out very high-end, totally integrated. And then Vspecs announced around about last April, I think. That's right. So, what was the white space at the time and what did Vspecs fill? Sure. So, if you sort of think about Vblock and our message to the community is consistent with EMC and that is VC is the single shortest path to TCO, right? The challenge around some of our partners delivering a solution like Vblock is that choice is limited, right? So, some number of our partners have different compute choices, have different hypervisor choices, different networking choices. And so, Vspecs allows a partner to bring that ecosystem together and still deliver a converged infrastructure. So, for us, we sort of accelerate that conversation a little bit further because we've got the broadest list of Vspecs Alliance partners, right? Every one of those Alliance partners is on our line card. Yes, so, you know, it's funny, you mentioned that we used to joke with Mike Capellis, you know, any color you want as long as it's black. Right. On the cube. Black is beautiful. Yeah, okay, so, okay, so now, so why Vspecs? There's other solutions in the marketplace. I know you're a tight EMC partner, but why Vspecs? So, I think the single biggest driver for both Avnet and our partners in the most simplest of terms is choice and profitability, right? So, from a choice perspective, it significantly expands our partner's ability to pick and choose the components under EMC's proven architectures. And the second piece is it allows our partners to deliver a great deal of services, right? So, from a services enablement motion, Vspecs is probably the single biggest generator. So, Pat Gelsinger was just on the cube here, now CEO of VMware, talk about, they want to be a service broker. You guys are in the solutions distribution business, which is what people want. They essentially, it's service brokering. So, how is this new world changing? You just mentioned some of those points. What are some of the dynamics in the marketplace that you're experiencing with the Vspecs, that in particular that kind of telegraphs the new world? Right. So, I answered it in a couple of ways. The first one is, as part of the Velocity program, we were recently authorized to provide services and specifically implementation of VNX, right? And so, what that did at that moment was significantly expand the number of partners who can deliver now a Vspec solution to the market, right? Because we're sort of think of the Verizon commercial, right? So, we're the army behind the partner that allows the partner to then deliver a variety of different solutions. That is probably the single biggest lever from our context and from an EMC context over the last several years. Right. Can you talk a little bit more, John, about services? Services means margin to a lot of partners. Absolutely. So, talk about the types of services and how that drives profitability for the partner. Sure. So, from a, most of our partners have a meaningful or substantial bench that the way they increase their profitability is about using the right bench for the right opportunity, right? And so, if you sort of think where rack and stack services and or then consulting services, say, around VMware, you clearly make a great deal more money with an EMC certified VMware engineer in a consulting environment versus a rack and stack environment. So, the partners now are allowed to sort of get out of the drudgery of the lower end part of the market and really focus on consulting services and that's really the highest part of the profitability model. Now, how are they approaching that? What can you share with us in terms of do they have to reskill, do they have to retrain and what are you and EMC doing to help them get there? Sure. So, if you sort of think about us from a pure distribution context, we sort of have three very important jobs. The first job that we have is to enable and train our partners, right? Both from a technical perspective and then from a marketing and sales enablement perspective. Avnet does a great deal of that heavy lifting. So, once we're able to operationalize a partner from a technical perspective, that partner then can go out and capitalize on sort of high-valid services. We have a service model that allows a partner to scale the partner's bench as needed, right? So, if they need sort of the lower end of services, we'll take care of that. We can augment the partner and then equally if the partner has competencies that we're not involved with, there's a great deal of partnering going on. So, you also talked about the verticalization aspect. Sure. Can you be more specific and add a little bit of color to that? What are you talking about in terms of verticals, what kind of verticals, what does that all mean? Yeah, so Avnet invested a fair amount of time, effort and energy in looking at how our partners grow and at our core, we believe that you can grow faster than the marketplace by focusing on a specific vertical. In our instance, healthcare is our single largest vertical practice that has enabled our partners to grow literally faster in some instances, two to three times faster than the market, than if they were to focus on a horizontal basis. So, if you think about healthcare and what it takes for a partner to start from zero and then be able to speak, articulate, position solutions in a healthcare environment, that is a significant value prop that we bring to the market. Okay, so when you think of verticalization, you think of the big consulting firms, like an Accenture, Deloitte, and of course the small guys can't afford those. Right, I mean, so, if I understand it correctly, you're enabling your partners to sort of do lighter weight versions of that for their customers, is that right? That's exactly right. So to your point, I think that a lot of our partners today sort of look at the market from a horizontal perspective and the cost that it takes to get the intelligence, all of the business intelligence around the data analysis of where the white space is in a particular market, right? So whether it be hospitals, where it be other healthcare providers, that takes a certain amount of investment to do. And so to your point, our small partners can't do that. And so when they partner with Avnet, we essentially accelerate their ability to get into the space and then we help them once they develop a specific vertical, we then have five others to focus on. So you guys like a machine, take some time to get all it right and then the program and then it goes. Can you talk about some of the impacts that you've had generally, but specifically with V-specs in terms of any metrics that you can share? I mean, what's the business case for the customer's benefit? Can you talk about that a little bit? Sure. So if you sort of think about the evolution of how and when V-specs was announced, it was roughly this time last year. And it started out as a reference architecture to give partners the ability to start talking about a private cloud deployment with a broad reach of compute network and storage. From the time it started to where it is today, I think a lot of partners are seeing the growth in the converge infrastructure space and that V-specs has definitely filled the void of how to accelerate delivering those solutions to the market, right? So the solutions are pre-validated by EMC, right? And so a lot of the guesswork has been removed from a DIY model to now a V-specs model. And I think with the latest announcement around services, both partner and distribution services, now we can really look at how the acceleration of V-specs can really be brought to the market. So is role your own pretty much dead in your view or still? No, I wouldn't say it's dead. I would say that everything in life sort of comes down to time and money. And so it's about ROI. If you're looking to deliver convergent infrastructures and do it quickly, DIY is still an option for partners who have the technical bandwidth to do that. The reality is if you look at what the market is looking for in terms of the desire to consume convergent infrastructures and the partner's ability to deliver that, V-specs really answers the call. And so I wouldn't say DIY is dead. I would say it's, it's... It's on live support. Yeah, it's on live support. Fair point. That's great. Well, thanks very much for coming in theCUBE. Really appreciate the time. Thank you very much. All right, everybody, keep it right there. We'll be right back with our next guest. This is theCUBE. We're live from EMC World Day Two.