 Live from Las Vegas, Nevada, it's theCUBE. Covering AWS re-invent 2016. Brought to you by AWS and its ecosystem partners. Now here's your host, Stu Miniman. Welcome back to Silicon Eagle Media's broadcast of AWS Summit 2016. AWS re-invent 2016. theCUBE's the worldwide leader in enterprise, tech coverage, live coverage. Happy to have you. Welcome back to the program, Lawrence Schwartz, who's the CMO of Software One. And I believe first time guest, Mike Ersten, who's the Global Director of Innovation. Gentlemen, thanks so much for joining us. Pleasure to be here. All right, Global Company, this event, it feels like the globe is converged as to what's going on here. Mike, we've had Lawrence on before. Maybe just for our audience, tell us a little bit about, tell us about yourself, what brought you to Software One and your role there? So wanting to be here at the conference. Well, first of all, I don't think I've seen a conference like this since, honestly, like maybe late 80s, early 90s, where some of the software publishers, like Microsoft and others in the early days, there was entrepreneurial excitement. You see many of these young companies here today. For us, it's about establishing those business to business relationships. And there's a lot of hype, there's a lot of excitement, the vibe is phenomenal. And that's why we're here, is to make those connections. All right, so you said you don't really carry business cards or titles, but you've got innovation in your title. You know, is this where innovation lives? I think so, I mean, look around you, you've got 30,000 people that are all building new solutions on a platform that didn't exist just 10 years ago, so I'd say spot on. All right, so Lawrence, I've known you for many years, we've been at many shows, last time interviewed at VMworld, no offense to our brethren at VMware, but it feels like this show has dwarfed that. What's your take on the show? Yeah, no, it's interesting for me, I've been, this is my fourth time at the show as well. So I've seen it grow from a few thousand now to this size, and what's astonishing is you still see a level of innovation happening, right? As AWS continues to roll out more and more services, more opportunities, that just expands exponentially around it, right? So that's why I think you see this growth here, but you see the same types of people here, right? People trying to innovate on top of that, trying to look ahead and see what's next, and really build out their value based on the growing platform. So more confidence in it, more of that establishment, like you heard in the keynote, this is here to stay and it's a question of when rather than if they're going to do it. So it's nice to see that change and you get a lot of energy at the show. Yeah, so you guys have an interesting place in the marketplace, you get to see a lot, what you call the publishers that are in your thing is what I think most people just kind of call software companies, even though I actually heard Amazon use the term publishers when they refer to them too, but how many of your clients are at the show participating in this AWS ecosystem? And I guess anything you can share on kind of that adoption of where software lives. Yeah, no, I think you see for us, and one of the reasons that this is software ones first year at the show, because we see our customers using this, adopting it, going out here, looking at the ecosystem. And I think what we've come to realize is that we're not going to be the innovator that can do all of this, right? You've got a big network here, you've got a big platform from AWS. So we really got to get to see that kind of global view of it. And so yeah, a lot of our customers are here and it's not the smaller ones, it's the bigger ones as well. So I think everyone's getting their foot in there and participating. And one of the reasons that we also came out here, talk about what we start doing in AWS, because again, it's a new platform for us. And it's a place for us to engage with the newer players, our customers, see where we can tie things together. Okay, great, yeah, maybe speak to what is the relationship with AWS, where you fit, any announcements you've got here this week? Yeah, for sure. So you mentioned publishers, software companies. We're a 30-year-old company that has historically been called a reseller, right? And so we work with 9,000 of those different software companies you talked about. But the world is changing rapidly as our typical enterprise customer is making that transition, that journey to the cloud. It's going from five to 10 to now 15 plus percent of their portfolio of software that's now been fully cloud-enabled. A lot of that is sitting on the AWS platform. In fact, the majority of it is sitting on the AWS platform. So for us, this is a natural relationship, one that's really important to us, and one that we intend to grow. Okay, let's get in Pyro Cloud, I believe, is the product, it's something I remember right this year, at least, kind of the update recently. Sheriff, give us a skinny. Yeah, yeah, no, it's been exciting for us because we focus as a company on software portfolio management, which is the end-to-end when you think about procurement of software, how do you manage that whole process? How do you get the best prices for things and work with the different vendors or publishers? We also work on the technology services side building it together, and then once you have it, kind of that software asset management side. So we've been doing that for a number of years for services and in the past year or two, we rolled out Pyro Cloud, it is a platform that gives you a digital way to kind of engage and figure out and look at all the different things you want to procure, get the whole catalog from all these different vendors that we've talked about and having thousands to work with. And it gives us a way to help customers manage that and look at those assets. And as you start looking into the cloud, it's not just about managing licenses or seats, it becomes about how do I think about consumption and what does that look like versus what I've acquired. So what we've done with Pyro Cloud is we had that first for Azure. And that was our starting point. And then coming out with this new announcement, we've expanded that deeper with Microsoft. So now we do things for Office 365. And then particularly relevant to this audience is being able to also show what's happening on the AWS side. So we've really grown out the platform quite a bit. And we really give that kind of meta view right across all their different systems that they have online, stuff that they have on the cloud, on premise. They get that global view of what's happening, one kind of single pane of glass view of it. And that's what we're here to talk about. And that's what we're getting some kind of exciting feedback on. Yeah, well Andy Jassy had kind of gleaned his eyes this morning talking about the big red O and how customers despise the licensing and the lawyers coming in for audits and everything. I'm wondering, give us your assessment. The public cloud players, do they change the game? It seems, I'm impressed when I see Amazon saying that, we're okay with you spending less money with us, we'll give you tools, partners are helping out. Give us the lay of the land. Microsoft, Amazon, if you've got it coming on Google. That's precisely why I think AWS has been so successful. They put the customer first. I think Lawrence touched on it. The old environment, the old on-premises software environment, which still represents the lion's share of most customer's software portfolio, customers needed to understand their license position. And for them, the license position was looking at what their entitlement was, what the contract, the big O, what they signed with the publisher or with the software company and comparing that against what their inventory looked like, what was installed in their environment. They would look at that gap and see, did my overspending relative to what I'm entitled to? Or for that matter, maybe on the other side of the equation, they have a compliance issue where they're over consuming, right? Now you shift over to the cloud, the dynamic changes completely. It's no longer what's the contract and what's the inventory. Now it's what's the subscription and then what's the consumption. So you still need to look at that license position. You're just looking at it through a different lens. All right, hybrid is a big discussion going on here. Of course, Amazon's got a slightly different view. You've got Microsoft and kind of their position as to where they're doing hybrid and Amazon, but you guys help both ends of the spectrum. So what do you hear from customers? What are the challenges they're having and how do you guys help them? I'm sorry, can you say that again? So hybrid, how do you help customers with hybrid? Yeah, so as we were talking about earlier, the portfolio is not all in the cloud yet. It's rapidly shifting. I think at the beginning of this year, the estimates that would be somewhere in the range of 10 to 15% of the overall enterprise portfolio would be in the cloud. It's probably growing a little faster than that, but it'll never be fully in the cloud. So our customers are telling us that they need that single pane of glass. They need that one view into the overall portfolio that includes the on-premises software as well as the cloud software. Today they're going to one place, a software asset management company perhaps to look at some of the on-premises license positions where they're going to a cloud consumption analytics provider to get a piece of the puzzle or a cloud brokerage provider to purchase a piece of it. They're looking for one place to go for all of that. And it isn't the DevOps manager that we're talking to. It's the procurement officer. It's the chief financial officer, CIO. It's a different buyer. All right, so Lawrence, when we look at this space, kind of that cloud management space, highly fragmented, we've heard for years from customers that it's one of the big challenges. Is it getting better overall? And how do you guys position yourselves compared to so many of the players that are out there? Yeah, I think what you see is, you've got a lot of different tools, a lot of different vendors out there. And even the providers themselves, obviously AWS and they all offer very specific tools that you can use. And I think what we come in and the value that we deliver is really giving you that kind of that meta cross view of it. I don't think it's getting any simpler. I think you see a lot of providers out here doing that. And there'll still be use cases, right? Where people really want to go in and the more technical people and they don't want anything in their way, right? They want to really get at it. They want to manage the bits. They want to optimize the performance, right? And you're never going to necessarily replace that for a lot of customers. But for a lot of people who want that global picture, hey, I want that single view of how much am I spending? What are the things that I can do to allocate and move stuff around? How can a vendor help me do that? Those are some of the opportunities. So one of the things that we introduce with the new PeraCloud is a decision calculator, right? Which is, now I can go and look at everything that my options and I can help get some advice on, you know, what could be more cost effective? And then if I want to do it, you know, what types of scenarios or workflows can I set up to help enable that to move over, right? So how do you provide value above that basic management console, right? If you're not talking to the technical people, you got to step back and say, how do I talk to the financial people? How do I talk to some of the other people and that want to look at this and kind of set things up and move them around a little bit more simply. All right, Mike, can you, for our audience, look forward a little bit, you know, what's exciting for you going forward? Where are you taking the extensions of what you're doing for PeraCloud? What do we expect to see from you guys next year or so? I think our ultimate vision is to be able to provide the full view into the software portfolio for our customers. We're not going to build it all ourselves. That's one of the reasons we're here. You know, we're looking at some of these providers, some of them, very small startups, just within the last year, that are building some pretty exciting technology. We'll integrate that and we'll provide that to our customers through one solution. And in a lot of ways, I think we look at ourselves as an aggregator, maybe the orbits, if you will, of software portfolio management. Yeah, Lawrence, I want to get your view on just kind of the state of the software ecosystem out there. We always joke, it's like, okay, how many things that Amazon said today that has the people crying over their beers in their booth today, what are they going to announce tomorrow and the day after? What do you see in the software ecosystem vis-a-vis cloud? Yeah, well I think the exciting stuff that we saw at least this morning in some of the announcements is you really look at where's the value on the stack, right? And there's a lot of stuff on the infrastructure as a service, everybody's been so focused on that. And now Amazon's kind of gone way above that, right? And they look at all the things that they can do on the speech recognition and the AI intelligence and whatnot. And I think that's an interesting area where you'll see a lot more opportunity going forward. So you go back to the management consoles, right? There's only so many of those that somebody could develop, right? Before you kind of hit an end game, right? But if you look at the ecosystem and you start thinking on the application level and what can I do with that? I think it'll be extremely exciting next year to come back here and see what people have done with this, what they've done on the voice recognition with Polly, with Lexa, and you'll see 20, maybe 50, maybe 100 new companies just built around some of the things they could do there. So I'm pretty excited about where the ecosystem goes and what develops and just how that changes the whole infrastructure stack. All right, well, Lawrence and Mike really appreciate coming and sharing us with the updates on where you brought FireCloud. Congratulations on that and all the updates on software one. No shortage of software here at AWS ReInvent 2016. We're excited to dig through lots more of it. You're watching theCUBE.