 Live from the Oracle Conference Center in Redwood Shores, California. It's theCUBE at the Next Generation Engineered Systems Launch Event. Brought to you by headline sponsor, Oracle. Okay, welcome back everyone. We are here live in Silicon Valley. This is theCUBE, our flagship program. We go out to the event, extract the students from the noise. I'm John Furrier, my co is Dave Vellante. Here live in Oracle's headquarters, Mike Jennings, CEO of Secure24 is here on theCUBE. Welcome to theCUBE. Thank you, thanks for having me. So behind us, you can see we've got the big backdrop. Oracle's getting ready for the big announcement. Larry Ellis is going to get on stage for their big, you know, X5 generation. We just talked to John Fowler in charge of engineering. What's your take on all this? I mean, you're not in trenches with the Oracle engineers, but maybe you are, you're out in the partnership. What's going on? I mean, what is Oracle all about right now? Are they going to open up a little bit? Well, you know, certainly what we're seeing from Oracle as a partner is they're, you know, making a big march towards converge computing. So software and hardware working together as a unified solution. And, you know, as a partner and a company that hosts a lot of Oracle products, both database as well as applications, you know, we're seeing a great benefit from both the supportability and the performance of those merged platforms. Oracle's partnership strategy is pretty clear. I mean, we've been to Oracle Open World now five years with theCUBE there and we've seen the evolution. I mean, it was almost like the lull before the big, you know, energy burst and was, you know, five years ago it was kind of like, okay, the transition was there. And then since then you've seen a lot of activity. Certainly their stock price is really at a high level right now. If you look at historically, almost back to the dot com boom in terms of performance. I mean, it's good to be an Oracle partner. They have a good business model. So we know it's a healthy ecosystem. What change do you guys see that they're tapping into? Why are they being so successful and why is their partnership strategy working? So, you know, what we've seen over the last five years, it's a good timeframe to kind of think about things over is, you know, with the integration of the sun platform and really Oracle moving towards integrating both hardware and software together, what we've seen is, you know, kind of a first wave of big performance boxes. So things like exolytics and Exadata and so forth. And we've leveraged those to deliver some very high performance solutions for our clients. What we're seeing now with the virtual computer clients, which we're a new customer of, is really a product that's very targeted at replacing, you know, standard x86 environments and Linux environments. And, you know, happy to talk to you guys about, you know, what we've done and kind of why we've gone that route. Did you do a bake off? Did you compare and contrast with other vendors? What was the process and? Sure, so, you know, if I look historically over the last few years, we've spent a lot of time kind of building what I would call our own V-blocks environment. So, you know, the EMC, VMware, Cisco partnership that built V-blocks. We looked at that product line from a converged product. And unfortunately, when it first came out, it didn't support many of the things that we needed around secure multi-tenancy, the ability to incorporate other components like other servers into the environment. And so we gave them a lot of feedback and they've been advancing that product. So in the meantime, we built essentially our own V-blocks environment. So we've been a Cisco UCS shop with EMC storage, EMC backup, EMC replication, and then running with VMware for a virtualization layer and an automation layer, and then Red Hat as an OS. And, you know, what we saw is we spent a lot of time having to, you know, spec out all the components for that environment, integrate all those components in building that out. And so that was typically a multi-month process. And then we had to build all of our own orchestration layer that kind of tied all those components together. And so with the virtual compute appliance, what we love about the product is that we get everything in a box. We get everything that I just described, you know, in the V-blocks environment. We get compute, we get storage, we get networking, we get software-defined networking, we get the orchestration layer, we get the Linux OS layer, and we get Oracle virtualization, all in an integrated device that is highly tuned to run Oracle workloads. And so we're seeing just a great benefit from going from that legacy environment that we would build ourselves to an environment that we can roll into the data center and within two hours of powering the virtual compute appliance up, we can actually start putting test workloads on it and using it as opposed to spending a month building it. So I want to talk a little bit about your business, but before we do, I want to pick up on that. So there's a lot of religious debates about which type of virtualization. I got VMware, I got KVM or OVM. What I just heard from you is I get in a box and it runs Oracle environments just fine. And those religious debates will leave elsewhere. I want to be confirmed and I talk about that a little bit. Sure, so obviously you want to use the right product for the right workload. And for an Oracle workload, traditionally we've had to put Oracle workloads on physical servers. So customers of Secure24 have really shied away from putting database servers on virtualization. And they've done that for many reasons. Part of it is cost reason. So Oracle's licensing for the database on a virtualized environment like a VMware environment can be very expensive. And so we've been running those on physical servers. And so this gives us an opportunity to virtualize the databases and get all the benefits of virtualization, all of the reliability, the redundancy, the transport that we can do with it. And so when we look at kind of that religious debate, for anything that's an Oracle workload, we find that running that on Oracle virtualization is the way to go. All right, let's talk about Secure24 a little bit. Talk about your business, kind of how you guys compete in the marketplace and we'll drill into that a little bit. Sure, so Secure24 is a managed service provider and a cloud transformation company. We don't do what we would traditionally call lift and shift in the managed services business. So we don't go into customers and take their equipment. My mess for less. Yeah, mess for less we don't do. So we really specialize in doing that transformation. So when we go into a customer, we look at their environment. Typically they've still got a lot of physical components in the environment, a lot of legacy components in the environment. That might be a HPUX, AIX environments, so forth. And we map them out a plan to take them from physical to virtual, from legacy systems onto open systems as part of that migration into Secure24. And so as a company, we serve over 180 clients today. They're typically large manufacturing clients. We're running enterprise level applications like the Oracle applications, SAP applications and many of the Microsoft product stacks. And then we're also running a lot of highly compliant application stacks for state and local government that require a high level of security and compliance as well. Secure24 as a business, we're almost 500 employees, been in business for 14 years and based out of Southfield, Michigan. And we typically compete with the IBMs and HP and CSC type companies out there in the marketplace for that enterprise hosting. So you're not a direct competitor, for instance, of Amazon Web Services, but Amazon Web Services has sort of created the whole cloud meme and the theme and how has that affected your business? How do you, I mean, you don't compete directly with Amazon, but how has it changed things? Yeah, it's actually been a great boon to our business because as that cloud message gets out into the marketplace and CIOs and so forth, really look at what do they wanna do long term. They don't wanna be in the data center business, they don't wanna be in the IT infrastructure business. And so cloud computing as a whole has really lifted all the ships in our industry. And so we've seen a great benefit from the success that Amazon and others have had in the public cloud computing space. You of course are in the data center business and that is your business, IT is your business. So talk about from the CEO's perspective what you want out of IT. I mean, you're not, I presume you're not an all oracle shop, you've got different needs. And so from your perspective in the corner office, what do you want out of your IT organization? So from my IT organization, if you think about what we do for a living, we manage over 6,000 virtual machines, over 10,000 devices in our data center today. And what we continually strive for and push for is a high level of automation, repeatability and process. And so we look for products to put into our data center and to manage in our data center that are simple. Simplification is a great thing. And I think over the years, IT has always been viewed as a very complex set of things. Everything from deployment to management to monitoring to maintenance have always been challenges. And so we really look for simplicity in our data center and the way that we design and deploy solutions. I feel like cloud is complex, but the industry is doing a good job of hiding that complexity from the users. Is that fair assessment? I think that's a very fair assessment. It's taken the industry as well as companies like Secure24. We spend a lot of time writing orchestration for our environment to simplify it and to really help the customers be able to click a button and say, I need a new server and have that deployed for them as opposed to having to see everything that goes on in the background. You mentioned some of the companies you're competing with, Mike. There's a big outsourcing component of that. We joked about sort of my mess for less, but I feel as though two in particular, IBM and CSC, they see the writing on the wall. They see IT is moving to utility. In IBM's case, they've acquired SoftLayer. In CSC's case, they're trying to transform. How do you compete with those guys? Why do you win and what do you see going forward in terms of the competitive landscape and what gives you confidence that you'll continue to win? Sure, so really what I see is our competitive advantage to the bigger players in the market is our agility. So the ability to deliver customer solutions very quickly. We've had customers come to us that need enterprise environments stood up in a week and we're able to do that very easily with all the tools that we've built and the way that we pre-provision environments. And so agility is a big component of that. Service level is another. So we have a very focused, hands-on team that works with our customers where we really become an extension of their IT department as opposed to a black hole that they're moving their applications or their compute needs into. And so really that advanced level of customer service helps differentiate us in the business. So how much do your customers get involved in the decision to bring in Oracle products, for example, do they have visibility on that? Are they pushing you to do that? Or do you hide that from them? Not hide, but do they care? Absolutely they care. And so while they're looking for a service level agreement and they're really relying on Secure 24 to deliver a solution, they want to know that that solution is tried true, tested in the marketplace. They don't want us running them on bleeding edge. They want us on leading edge type solutions. And so they look to us to innovate and to be able to take that innovation and drive better solutions for them. So better performance, better uptime, better reliability are things that they're always looking for. And so when we talk to the customers, we do quarterly business reviews with all of our customers and we talk to them about what is our technology roadmap? Why are we going in certain directions? Why did we just acquire last year two fully built virtual compute appliances for Oracle? And we talked to them about the benefits of that platform and then how that could apply to their business and what metrics we could drive for them by moving them to that platform. What was the key things that you mentioned in that, just to drill down on that? So were they indifferent about that or were they more, are they interested in the appliance or were they, oh, whatever? What were some of the comments? So their biggest concern is typically uptime, reliability, and then performance. So typically we're targeting customers that are having performance issues on their applications or databases today that are looking to move to the virtual compute appliance to leverage the performance gains that we're getting out of that environment. And so the big advantage we get over the generalized compute environment that we talked about earlier, that was on Cisco, EMC, Red Hat, and VMware by leveraging the virtual compute appliance from Oracle, it's completely tuned for running Oracle workloads. And so we're seeing, in general, we see a 30 plus percent performance gain in databases running on VCA. And we see that specifically because they're the way that not only the OS, the Oracle Enterprise Colonel for Linux is tuned, you look at the Infiniband network and then you look at all of the caching that takes place in the storage layer of virtual compute appliance really helps us deliver a better performance environment. People want more performance. You got all kinds of stuff, batch jobs, all kinds of stuff that's getting bigger and bigger, more data's coming in. Absolutely. Does this affect their licensing? I mean, does it make it more complicated? How does it simplify? Absolutely simplifies the licensing. And I talked about before having to deploy Oracle databases on physical machines because of the licensing issues. With the virtual compute appliance, it comes with Oracle Trusted Partitioning. And Oracle Trusted Partitioning allows us to deliver Oracle databases in a very cost-effective manner for our customers. So Oracle defines that as each, if you look at a virtual CPU, two virtual CPUs equal one CPU of physical. And so typically when you start a database, you're having to pin it to the CPUs so that Oracle knows how many CPUs you're running that database on. And with Trusted Partitioning, it gives us an easy way to do that for our customers in a very cost-effective manner. It's always a contentious issue with the licensing thing. Well, I appreciate you coming on theCUBE. Mike, what's your take on this announcement based upon what you're seeing here? We've got Larry coming on at one o'clock. What's your take, what's going on here? So my take is the virtual compute appliance came out last year and it came out and they've made some very big improvements to the platform. And today I'm really excited because as we've invested in that platform, we've deployed two fully built virtual compute appliances, one in our Michigan data center, one in our Las Vegas data center, and we took a leap of faith. It was a leading edge product when it was first delivered. And so today, what I'm really excited about is Oracle is continuing to put their brand behind delivering improvements to the VCA platform and extending that platform into the future. So we know that we've made a good investment and it's something that we can continue to leverage going forward for our clients. As John Fallow said, Larry's the master of the long game. This is just one card or one move in the journey. So I'm excited to see what else they got coming out. So we appreciate you spending the time here in theCUBE. This is theCUBE. We are live here at the Oracle headquarters in Silicon Valley for Oracle's big announcement. Larry Ellis is coming on stage as well as all the top executives. Really around the future of their computing, mostly the son announcement and a VCE comparison tape. We'll get into that later in our analysis. I'm John Furrier with Dave Vellante. We'll be right back.