 The Cube presents On the Ground. Here's your host, John Furrier. Hello, I'm John Furrier with SiliconANGLE Media, The Cube. And we are here at the Ritz Carlton in San Francisco for the special exclusive press event with Andy Jassy. And the special announcement was Pat Gelsinger, the CEO of VMware, announcing what, in my opinion, is probably the biggest, most historic announcement in the industry, and certainly for VMware as the future migration to the cloud, migration of the next generation, infrastructure continues. It's a big significant announcement, exclusively if I'm gonna have a one-on-one interview with Andy and Pat shortly. But I had a chance to grab the chief architect of this deal, one of the many, the lead EVP and general manager of the sub-infinite center, Raghu Aram. Welcome to see you, great to see you. Thanks for spending the time. Good to see you, thanks. So Raghu, you're an old-timer VMware, but now you're also architecting what looks to be the bridge to the future for VMware. This relationship with AWS Amazon Web Services puts VMware in the cloud, the best, most functional, best, biggest public cloud, and most robust capabilities immediately in Amazon, available mid-2017. But this is a path, instantly, for all VMware customers. What's, when did this all start and what motivated? To architect this? Yeah, I mean, as you recall, the past VMware, we announced our cross-cloud architecture and the idea that customers, enterprise customers want choice with control, right? The legwork for that was done over a year ago, right? When we internally, we finalized our strategy to enable our platform to run in multiple different clouds, such as our weekend partner network and IBM and now AWS. So that's when we all started around this. But the key idea here is for customers that are increasingly putting a variety of workloads from the, in their private cloud, in their public cloud, you wanna have a consistent way of running and managing and securing and operating these applications. And as you just pointed out, one of the biggest cloud providers for our customer is AWS. And so this was a natural partnership from that point of view. So one of my favorite tweets out there was from, obviously, Dave Vellante, co-host of theCUBE. He said, please allow me to translate. He was translating, I'm from a customer, we're gonna help on customer impact. One, you've squeezed the blood from the data center stone with virtualization. You've done all you can. This is my customer translation. Two, you have a legacy amount of VMware processes and procedures and software, AKA VMware. Three, you're jonesing for the agility and innovation of AWS. Come on in, the water is nice and warm. So essentially, it's kind of tongue in cheek, but the data center has been maxed out. So data center consolidation, certainly people don't want to be in the data center business, but they want the benefits of a data center with the cloud. You guys are not providing that. What is the impact to customers? Because they are jonesing for innovation. They're jonesing for microservices. They're jonesing for cloud native. They're jonesing for, some of the goodness that Amazon has shown works. But yet, it's a huge migration nightmare. And they want a SaaS business model. They want a SaaS company. This is the digital transformation. What is the impact of customers? Yeah, I mean, it ultimately comes down to simplicity and agility, right? And there is two big transformations going on. One is there is a huge data center transformation going on driven by simplicity, driven by software. And that is the whole software defined data center. While you're absolutely right, many of our customers are maxed out, the server virtualization, but their network is inefficient and the storage is inefficient, et cetera, et cetera. So the software defined data center is one of the moves they're making. Now, at the same time, like you said, they're jonesing for all these advanced services for their new applications, and they want some way to bridge both environments. And that's where this service hits the sweet spot if you will, right? Now, without replatforming, without changing your operational models, like your quote that you quoted, without changing any of our operational models, you can have an agile, undemanded VMware data center. And what's running in that VMware data center is the full software defined data center stack, all of the great security and manageability capabilities of networking, of NSX, of virtualSAN, of vSphere. At the same time, connecting to all these great services that AWS provides. It's really a best of both worlds story. So from a customer's standpoint, if I get this right, there's a big, you know, breathing out, oh, finally, I got to running. I don't have to do all this heavy lifting to move my VMware to the cloud. One, two, in the demo, they were showing vCenter. So specifically under the hood, what is running in the full stack? I mentioned vMotion, I heard vMotion mention. Is it all, all of the entire VMware stack running on the cloud? Yes, so the stack that's powering that that you saw in the demo is virtualSAN, virtualizing the storage underneath, NSX, providing the network virtualization, and of course vSphere. That's the core infrastructure stack. And in order to manage an ESX nodes for the hypervisor, in order to manage ESX and control these resource pools and so on, you have the vSphere functionality built into vCenter. And that was a key requirement, design requirement for this service, is customers are very, very familiar with vCenter. They've been operating it for 15 years. And there's a huge ecosystem of tools, operational tools, backup tools, security tools, you name it, built around vCenter. And all of that had to work seamlessly in the cloud. And that's why vCenter is so important. And the vSAN certainly got a lot of helps with the storage side of it. You mentioned networking. How does the Amazon relationship and the co-locating, if you want co-locating, but running, manage in AWS, help on the networking? Because in the demo, what was very cool besides the pay by credit card and pay by VMware account, was the fact that you can pick a global footprint instantly, which means, from what I took away was it, I can be up and running in a geography with networking in the cloud, but not just Amazon's networking, your networking. Absolutely. That's accurate. You got it right. So Amazon obviously has got a global network fabric that powers their services. And so you can stand up these clusters of the STDC hardware, if you will, on any one of their data centers in the fullness of time, maybe not on day one. And NSX already has the capability to connect across STDC clusters across different data centers. So now you can stretch a logical network and have literally applications in a Portland data center of AWS and applications in the Virginia data center of AWS and applications in that London data center, all tied together by a logical network. All right, so I'm going to ask some hard questions now. Constantinously, by the way. So here's the hard question. So here's the hard question. So Paul Moritz and Joe Tucci no longer involved. Moritz retired, Tucci retired, wanted to own the enterprise. The private cloud was the original thing. Amazon was just kind of getting strong lift at that time. The world has gone all hybrid. There's a lot of hybrid cloud going around. So the world's different from them. So I want to get your comments on where the private cloud has came from to this reality. And two, comment to the naysayers out there that have heard some tweets like, oh, RIP VMware. They rang the bell, they tapped out, they capitulated. Talk about those two dynamics. Private cloud, that vision from Moritz and Tucci. And how do you answer the critics who say, oh, they capitulated to VMware's toes? Yeah, so both of them, I would say, are significantly incorrect views of how you look at this. The private cloud is still very strong, right? And we've got customers deploying the private cloud, literally every large enterprise that we've talked to. And we've got the leading share when it comes to private cloud deployments. And along with the Pivotal Cloud Foundry, we can offer not just the infrastructure, services of a private cloud, but also the application platform services of the private cloud. And the private cloud exists for lots of different reasons. It can be regulation, it can be... That's not telling me, private cloud is not going away, anytime soon. Yeah, exactly. What this allows customers to do is really get a hybrid that combines the best of VMware environment and the best of an AWS environment. And that's really what's unique. And what is in the service is the full VMware stack. And you gotta remember that 95% of our customers are still largely on vSphere. They've just started deploying and adopting NSX and VirtualSAN. By adopting this service, they automatically get upgraded to the full power of network virtualization and storage virtualization. And of course... So you see this as an expansion of the business model, not anything... Exactly. I see this as a complete expansion of the business model. And that's gonna come from SaaS apps or... So the whole service is a managed service. So customers do not have to learn how to sort of re-architect their data center. They can just get a re-architected data center on demand wherever they want. Or they can build the re-architected data center by themselves and connect it all up, right? A final question. Obviously, I'd love to chat more about what it's like to cut this deal with Amazon. Fan of both of you guys. Actually, we use Amazon, we're a customer. Talk about your relationship with other clouds. This comes up with the press, people who are not as deep on the industry. They talk about IBM. Oh, it's IBM and Azure. Azure, we can see that as competitive thing. I don't want to go there because we're going to do a whole blog post on the impact of Microsoft, which I think is the big competitor force for customers. But you guys have an open cloud strategy. And I think the IBM thing is, let them compete. Now they have soft layer. Now someone argue Amazon and you talk about the relationship with them in soft layer and how they compete. But ultimately, IBM is deep with you guys. They're adding 20,000 developers. I think 4 million people train, highly integrated with VMware. So your strategy with them is the same, right? But primarily as a service operating on Amazon. Are you guys going to be operating on soft layer and blue mix as well? In a similar fashion. So the service that we announced last month with IBM is a service that IBM is managing and operating. And we have worked very closely with them, the VMware Cloud Foundation. That's just their business model. They're going to operate that. You guys will operate the AWS cloud. We operate the VMware cloud on AWS, right? And IBM operates that service, but we go to market together with IBM on their service. And we work very closely with them. So this is a choice thing for you guys. It has nothing to do with picking a better part of the even use word primary. I mean like Pat talked about in the Q&A session, we've got lots of customers that are customers of AWS. And for them, the first choice might be the VMware Cloud on AWS. We've equally got a lot of customers that are customers of IBM and for them and software. And for them, the choice would be running their applications on the IBM Cloud with the VCloud. Ragu, thanks for taking the time to speak with us. I'll give you the final word. Not on the business side because it's pretty obvious we can win-win on the business side. What is the coolest technical under the hood thing about this deal that people should know about? I think what AWS has engineered to build the service and how we are taking advantage of it for delivering an elastic data centers across the globe is going to be very, very cool once we can talk more about it in a public domain. Ragu, you had a vice president. Great to see you. Chief architect of this deal, among many other things at VMware, well-known within the industry, legend in the VMware community. Thanks for joining us here on the non-live queue, but we're here in San Francisco for the exclusive announcement of the AWS-VMware relationship, partnership, integration, a lot of goodness there. I'm John Furrier, thanks for watching.