 Live from Las Vegas, it's theCUBE! Covering AWS ReInvent 2019, brought to you by Amazon Web Services and Intel, along with its ecosystem partners. Okay, welcome back everyone. CUBE's live coverage of AWS ReInvent 2019. This is theCUBE's seventh year covering Amazon ReInvent. It's their eighth year of the conference and I want to just shout out to Intel for their sponsorship for these two amazing sets. Without their support, we wouldn't be able to bring our mission of great content to you. I'm John Furrier, Stu Miniman. We're here with the chief of AWS, the chief executive officer, Andy Jassy. Tech athlete in and of himself, three hour keynotes. Welcome to theCUBE again, great to see you. Great to be here, thanks for having me guys. Congratulations on a great show, a lot of great buzz. Thank you. A lot of good stuff, your keynote was phenomenal. You get right into it, you giddy up right into it as you say, three hours, 30 announcements. You guys do a lot, but what I like the new addition in the last year and this year is the band, House Band. They're pretty good. They hit the queen notes, so that keeps it balanced. So we're going to work on getting a band for theCUBE. Awesome. So if I had to ask you, what's your walk-up song, what would it be? There's so many choices, it depends what kind of mood I'm in. But maybe times like these by the Foo Fighters. These are unusual times right now. Foo Fighters playing at the Amazon Intersect Show, as they are, Andy, headlining. Very clever, always getting a good plug in there. Well, congratulations on the Intersect. You got a lot going on. Intersect is a music festival. I'll get that in a second. But I think the big news for me is two things. Obviously, we had a one-on-one exclusive interview and you laid out essentially what looks like was going to be your keynote, it was transformation. Thank you for the practice. I'm glad to practice, use me any time. And I'd like to appreciate the comments on Jedi on the record, that was great. But I think the transformation story is a very real one, but the NFL news you guys just announced to me was so much fun and relevant. You had the commissioner of NFL on stage with you, talking about a strategic partnership. That is as top-down, aggressive goals you could get. To have Roger Goodell fly to a tech conference to sit with you and bring his team, talk about the deal. Well, you know, we've been partners with the NFL for a while with the next gen stats that they use on all their telecasts. And one of the things I really like about Roger is that he's very curious and very interested in technology. And the first couple of times I spoke with him, he asked me so many questions about ways the NFL might be able to use the cloud and digital transformation to transform their various experiences. And he's always said, if you have a creative idea or something you think could change the world for us, just call me, or text me or email me and I'll call you back within 24 hours. And so, we've spent the better part of the last year talking about a lot of really interesting strategic ways that they can evolve their experience, both for fans as well as their players. And the Player Health and Safety Initiative, it's so important in sports and particularly important with the NFL given the nature of the sport. And they've always had a focus on it, but what you can do with computer vision and machine learning algorithms and then building a digital athlete, which is really like a digital twin of each athlete. So you understand what does it look like when they're healthy and compare that when it looks like they may not be healthy and be able to simulate all kinds of different combinations of player hits and angles and different plays so that you could try to predict injuries and predict the right equipment you need before there's a problem, can be really transformational. So we're super excited about it. Did you guys come up with the idea or was it a collaboration between them? It was really a collaboration. I mean, look, they are very focused on players' safety and health and it's a big deal for their, you know, they have two main constituents, the players and fans, and they care deeply about the players and it's a hard problem in a sport like football. I mean, you watch it. Yeah, and I got to say, it does point out the use cases of what you guys are promoting heavily at the show here of the SageMaker Studio, which is a big part of your keynote, where they have all this data. Right. And they're data hoarders. They do the hoard data, but the manual process of going through the data was a killer problem. This is consistent with a lot of the enterprises that are out there. They have more data than they even know. So this seems to be a big part of the strategy. How do you get the customers to actually awake up to the fact that they got all this data and how do you tie that together? I think in almost every company, they know they have a lot of data and there are always pockets of people who want to do something with it, but when you're going to make these really big leaps forward, these transformations, the things like Volkswagen is doing, where they're reinventing their factories and their manufacturing process or the NFL, where they're going to radically transform how they do players' health and safety, it starts top down. And if the senior leader isn't convicted about wanting to take that leap forward and trying something different and organizing the data differently and organizing the team differently and using machine learning and getting help from us and building algorithms and building some muscle inside the company, it just doesn't happen because it's not in the normal machinery of what most companies do. And so it almost always starts top down. Sometimes it can be the commissioner or the CEO, sometimes it can be the CIO, but it has to be senior level conviction or it doesn't get off the ground. And the business model impact has to be real. For NFL, they know concussions, hurting their youth, pipelining. This is a huge issue for them, this is their business model. They lose even more players to lower extremity injuries. And so just the notion of trying to be able to predict injuries and the impact it can have on rules and the impact it can have on the equipment they use, it's a huge game changer when they look at the next 10 to 20 years. Love geeking out on the NFL, but... No more NFL talk? Yeah, off camera. You want to talk about the Giants being two of 10? We're both Patriots fans here. Bring up the undefeated season. So everybody's a Patriots fan now. It's fascinating to watch. You and your three hour keynote, Werner in his architectural discussion, really showed how AWS is really extending its reach. It's not just a place. For a few years, people have been talking about, cloud is an operational model. It's not a destination or a location. But I felt it really was laid out as you talked about breadth and depth and Werner really talked about architectural differentiation. People talk about cloud, but there are very, there are a lot of differences between the vision for where things are going. Help us understand why, I mean Amazon's vision is still a bit different from what other people talk about where this whole cloud expansion journey, but put it over what tag or label you want on it, but the control plane and the technology that you're building and where you see that going. Well, I think that we've talked about this a couple of times. We have two macro types of customers. We have those that really want to get at the low level building blocks and stitch them together creatively and however they see fit to create whatever's in their heads. And then we have this second segment of customers who say, look, I'm willing to give up some of that flexibility in exchange for getting 80% of the way there much faster and an abstraction that's different from those low level building blocks and both segments of builders we want to serve and serve well. And so we've built very significant offerings in both areas. I think when you look at microservices, some of it has to do with the fact that we have this very strongly held belief born out of several years at Amazon where the first seven or eight years of Amazon's consumer business, we basically jumbled together all of the parts of our technology and moving really quickly. And when we wanted to move quickly where you had to impact multiple internal development teams, it was so long because it was this big ball, this big monolithic piece. And we got a religion about that and trying to move faster in the consumer business and having to tease those pieces apart. And it really was a lot of the impetus behind conceiving AWS where it was these low level, very flexible building blocks that don't try and make all the decisions for customers. They get to make them themselves. And some of the microservices that you saw Werner talking about, just for instance, what we did with Nitro or even what we did with Firecracker, those are very much about us relentlessly working to continue to tease apart the different components. And even things that look like low level building blocks over time, you build more and more features. And all of a sudden you realize they have a lot of things that are combined together that you wished weren't, that slow you down. And so Nitro was a completely reimagining of our hypervisor and virtualization layer to allow us both to let customers have better performance but also to let us move faster and have a better security story for our customers. I got to ask you the question around transformation because I think it all points to that, all the data points, you got all the references, Goldman Sachs on stage at the keynote, I mean healthcare is just an amazing example because I mean this demonstrating real value there, there's no excuse. I talked to someone who wouldn't be named last night in and around the area, said the CIA has a cost bar like this, cost of a budget like this but the demand for mission based apps is going up exponentially. So there's need for the cloud. And so you're seeing more and more of that. What is your top down aggressive goals to fill that solution base because you're also a very transformational thinker. What is your aggressive top down goals for your organization because you're serving a market with trillions of dollars of spend that's shifting that's on the table. A lot of competition now sees it too, they're going to go after it but at the end of the day you have customers that have a demand for things, apps and not a lot of budget increase at the same time. This is a huge dynamic. What's your goals? I think that at a high level our top down aggressive goals are that we want every single customer who uses our platform to have an outstanding customer experience. And we want that outstanding customer experience in part is that their operational performance and their security are outstanding but also that it allows them to build projects and initiatives that change their customer experience and allow them to be a sustainable, successful business over a long period of time. And then we also really want to be the technology infrastructure platform under all the applications that people build. And we're realistic, we know that the market segments we address with infrastructure, software, hardware and data center services globally are trillions of dollars in the long term. It won't only be us but we have that goal of wanting to serve every application and that requires not just the security and operational performance but also a lot of functionality and a lot of capability. We have by far the most amount of capability out there and yet I would tell you we have three to five years of items on our roadmap that customers want us to add and that's just what we know today. Well and Andy, underneath the covers you've been going through some transformation when we talked a couple of years ago about how serverless is impacting things. I've heard that that's actually in many ways the glue behind the two pizza teams to work between organizations. Talk about how the internal transformations are happening and how that impacts your discussions with customers that are going through that transformation. Well I mean there's a lot of the technology we build comes from things that we're doing ourselves and that we're learning ourselves. It's kind of how we started thinking about microservices, serverless too, we saw the need. We would have, we would build all these functions that when some kind of object came into an object store we would spin up compute, all those tasks would take like three or 400 milliseconds then we'd spin it back down and yet we'd have to keep a cluster up in multiple availability zones because we needed that fault tolerance and it was, we just said this is wasteful and that's part of how we came up with Lambda. And you know when we were thinking about Lambda people understandably said well if we build Lambda and we build this serverless event driven computing a lot of people who are keeping clusters of instances aren't going to use them anymore it's going to lead to less absolute revenue for us. But we have learned this lesson over the last 20 years at Amazon which is if it's something that's good for customers you're much better off cannibalizing yourself and doing the right thing for customers and being part of shaping something. And I think if you look at the history of technology you always build things and people say well that's going to cannibalize this and people are going to spend less money. What really ends up happening is they spend less money per unit of compute but it allows them to do so much more that they ultimately long term end up being more significant customers. I mean you are like beating the drum all the time. Customers, what they say when you put Mr. Roadmap I got that you guys have that playbook down that's been really successful for you. Two years ago you told me machine learning was really important to you because your customers told you what's the next tranche of importance for customers? What's on top of mind now as you look at this reinvent kind of coming to a close replace tonight you had conversations, you're a tech athlete you're running around doing speeches talking to customers. What's that next hill from this machine learning today? There's so much. I mean that's not a soup question. And I think we're still in this in the very early days of machine learning it's not like most companies have mastered it yet even though they're using it much more than they did in the past. But I think machine learning for sure I think the edge for sure I think that we're optimistic about quantum computing even though I think it'll be a few years before it's really broadly useful. We're very enthusiastic about robotics. I think the amount of functions that are going to be done by these robotic applications are much more expansive than people realize it doesn't mean humans won't have jobs they're just going to work on things that are more value added. We're believers in augmented virtual reality we're big believers in what's going to happen with voice. And I'm also, I think sometimes people get bored I think you're even bored with machine learning maybe already but people get bored with the things you've heard about but I think just what we've done with the chips in terms of giving people 40% better price performance than the latest generation of x86 processors it's pretty unbelievable in the difference in what people are going to be able to do or just look at big data. I mean we haven't gotten through big data where people have totally solved it the amount of data that companies want to store, process and analyze is exponentially larger than it was a few years ago and it will I think exponentially increase again in the next few years you need different tools and services. Well I think we're not bored with machine learning we're excited to get started because we have all this data from the video and you guys got SageMaker. We call it the stairway to machine learning heaven. You start with the data, move up, knock. You guys are very sophisticated with what you do with technology and machine learning and there's so much. I mean we're just kind of again in such early innings and I think that it was so before SageMaker it was so hard for everyday developers and data scientists to build models but the combination of SageMaker and what's happened with thousands of companies standardizing on it the last two years plus now SageMaker Studio giant leap forward. We hope to use the data to transform our experience with our audience and we're on Amazon Clouds we really appreciate that and appreciate your support with Amazon and get that machine learning going a little faster for us that'll be better. If you have requests I'm interested. So Andy you talked about that you've got the customers that are builders and the customers that need simplification. Traditionally when you get into the heart of the majority of adoption of something you really need to simplify that environment but when I think about the successful enterprise of the future they need to be builders. So has the model flipped if I normally would say enterprise want to pay for solutions because they don't have the skill set but if they're going to succeed in this new economy they need to go through that transformation that you have to do. So I mean are we in just a total new era when we look back will this be different than some of these previous waves? It's a really good question Stu and I don't think there's a simple answer to it. I think that a lot of enterprises in some ways I think wish that they could just skip the low level building blocks and only operate at that higher level abstraction that's why people were so excited by things like SageMaker or CodeGuru or Kendra or Contact Lens. These are all services that allow them to just send us data and then run it on our models and get back the answers but I think one of the big trends that we see with enterprises is that they are taking more and more of their development in-house and they are wanting to operate more and more like startups. I think that they admire what companies like Airbnb and Pinterest and Slack and Robin Hood and a whole bunch of those companies Stripe have done and so I think you go through these phases and eras where there are waves of success at different companies and then others want to follow that success and replicate and so we see more and more enterprises saying we need to take back a lot of that development in-house and as they do that and as they add more developers those developers in most cases like to deal with the building blocks and they have a lot of ideas and how they can creatively stitch them together. Yeah, on that point I want to just quickly ask you on Amazon versus other clouds because you made a comment to me in our interview about how hard it is to provide a service to other people and it's hard to have a service that you're using yourself and turn that around and the most quoted line of my story was the compression algorithm. There's no compression algorithm for experience which to me is the diseconomies of scale for taking shortcuts. And so I think this is a really interesting point. Just add some color commentary because I think there's a fundamental difference between AWS and others because you guys have a trajectory over the years of serving at scale customers wherever they are, whatever they want to do now you got microservices, it's even more complex. That's hard. Yeah, I think there are a few elements to that notion of there's no compression algorithm for experience. And I think the first thing to know about AWS which is different is we just come from a different heritage and a different background. We ran a business for a long time that was our sole business that was a consumer retail business that was very low margin. And so we had to operate at very large scale given how many people were using us but also we had to run infrastructure services deep in the stack, compute storage and database and reliable scalable data centers at very low costs and margins. And so when you look at our business, it actually today, I mean it's a higher margin business in our retail business, the lower margin business and software companies, but at real scale it's a high volume relatively low margin business. And the way that you have to operate to be successful with those businesses and the things you have to think about in that DNA come from the type of operators that we have to be in our consumer retail business and there's nobody else in our space that does that. So the way that we think about cost, the way we think about innovation in the data center and I also think the way that we operate services and how long we've been operating services of the company, it's a very different mindset than operating package software. Then you look at when you think about some of the issues in very large scale cloud you can't learn some of those lessons until you get to different elbows of the curve and scale. And so what I was telling you is it's really different to run your own platform for your own users where you get to tell them exactly how it's going to be done. But that's not the way the real world works. I mean, we have millions of external customers who use us from every imaginable country and location whenever they want without any warning for lots of different use cases and they have lots of design patterns and we don't get to tell them what to do. And so operating a cloud like that at a scale that's several times larger than the next few providers combined is a very different endeavor and a very different operating rigor. Well, you got to keep raising the bar. You guys do a great job. Really impressed again, another tsunami of announcements. In fact, you had to spill the beans early with Quantum the day before the event, tight schedule. I got to ask you about the music festival because I think this is a really cool innovation. It's the inaugural intersect conference, which is not part of Replay, which is the concert tonight. It's a whole new thing, big music act. You're a big music buff. Your daughter's an artist. Why did you do this? What's the purpose? What's your goal? Yeah, it's an experiment. I think that what's happened is that re-invent has gotten so big. We have 65,000 people here that to do the party, which we do every year, it's like a 35, 40,000 person concert now, which means you have to have a location that has multiple stages. And we thought about it last year when we were watching it and we said, we're kind of throwing like a four-hour music festival right now, there's multiple stages. And it's quite expensive to set up that set for a party. And we said, well, maybe we don't have to spend all that money for four hours and then rip it apart because actually the rent to keep those locations for another two days is much smaller than the cost of actually building multiple stages. And so we thought we would try it this year. We're very passionate about music as a business. And I think our customers feel like we've thrown a pretty good music party the last few years and we thought we would try it at a larger scale as an experiment. And if you look at the economics- And the headliners real quick. The Foo Fighters are headlining on Saturday night, Anderson Pock and the Free Nationals, Brandy Carlisle, Sean Mullins, Willie Porter, it's a good set. Friday night it's back and Casey Musgrave. So it's a really great set of about 30 artists and we're hopeful that if we can build a great experience that people want to attend that we can do it at scale. And it might be something that both pays for itself and maybe helps pay for reinvent too over time. And I think that we're also thinking about it as not just a music concert and festival. The reason we named it Intersect is that we want an intersection of music genres and people and ethnicities and age groups and art and technology all there together. And this will be the first year we try it. It's an experiment and we're really excited about it. Tom gone, congratulations to all your success. And I want to thank you. We've been seven years here at Reinvent. We've been documenting the history. We have two sets now, one set upstairs. So appreciate you. The Cube is part of Reinvent. You know, you guys really are a part of the event and we really appreciate your coming here and I know people appreciate the content you create as well. And we just launched Cube 365 on Amazon Marketplace built on AWS. So thanks for letting us build on the platform. Appreciate it. Thanks Andy. Thanks for having me guys. I appreciate it. Andy Jassy, the CEO of AWS here inside the Cube. It's our seventh year covering and documenting the just the thunderous innovation that Amazon's doing. They're really doing amazing work. Building out the new technologies here in the cloud computing world. I'm John Furrier, Stu Miniman. Be right back with more after this short break.