 Live from the FIIA Barcelona Grand Villa conference center in Barcelona, Spain, it's The Cube at HP Discover Barcelona 2014, brought to you by headline sponsor HP. Here are your hosts, John Furrier and Dave Vellante. Okay, welcome back everyone, we are live in Barcelona, this is The Cube for HP Discover 2014 in Europe, they're European customer show, this is The Cube. The Cube alum in Barcelona of last year, Vegas, you're regular now, welcome back. So we had Seamus on yesterday, great guest, he's loved his accent, he's just also dynamic, but he was very, he had a spring in his step, business is good, and so he launched on The Cube and they had no revenue, now he's doing billions of dollars in revenue, he's also happy, so service is the key, but networking is a big growth area, obviously with NFB, with network virtualization, we saw even going back to the shot heard around the world in the VN where he bought Nacera, you know, OpenFlow was out, you guys had some shipping products with some of the first sports on OpenFlow back in the day, now we're a few years down the road, where are we, what's going on with the networking stuff, what are some of the pain points for the customers, and what do you guys work with? Yeah, so great to be back, thank you for inviting me. So I think clearly from an HP perspective software defined networking has been a big investment area for us, a strategic area of investment, and you know customers have really, I guess, kicked the ties around SDN for a while, there are a number of different solutions available on the market, and it's a big transition going from a traditional, very static network to something that's very new and dynamic. So we're now actually getting to the point where customers are starting to implement software defined networking, which is great, and of course the support experience that we have to provide them is quite different to a static network, where really, we've been providing remediation support on a device with SDN, we're having to support the full infrastructure, it's really a system that we're supporting, so it's the devices, the control layer, and the application layer, so the experience is very different, and it's very important that we get that experience right, because it's a key component of SDN. Can you describe in some more detail the difference, sort of the static versus dynamic, you talk about the service, the experience you're supporting, many more layers, can you just double click on that a little bit and help us understand and add a little bit more color to that? Sure, absolutely. So in terms of the traditional network, I mean very typically the customer would have an administrator that would do a lot of the manual activities, a lot of the work to really program the network, very manual, very transactional, very slow actually, and with an SDN network, we're automating many of the tasks. And really the requirements that the network admin had of a support provider like HP was really just turned up when the device fails. In terms of what we're doing now with SDN, there's far more requirements to really fully understand the integrated stack, so really understanding how these components are interoperating. And if there is an issue or a problem, we have to have the ability to really drill down and identify the root cause very quickly. So I would say the stack is far more complex, but our role really is to hide the seams for the customer and ensure that they're getting the reliability really that they require. When you go around, Alstair, and talk to customers, what are you seeing in terms of SDN adoption? I wonder if you could frame it in terms of sort of those that are really hardcore going for it, those that are showing interest and those are sort of, you know, not really there yet. What's the market telling you? What's it look like right now in terms of the maturity model? So I would say all customers are certainly interested in looking at it. You know, it's now a reality. I think for a number of years it was a theory. And now it's a reality. I mean, you can go on our App Store and there are, in fact, I was on the App Store last night. We have many different apps now that you can apply to an SDN network. So I think people appreciate that in order to get to this, you know, vision of software defined infrastructure, software defined data center, the network really is probably the laggard of all of the technology domains that we have. And for me, customers are really now starting to look at where can we really start? Where's the right inflection point for us to start to implement SDN? So I would say, typically, based on my experience, applications like Link, so in the collaboration space, that's really where we've got something very tangible. You can really, really see the difference that an SDN-enabled network makes using something like Link, where you can dynamically program the network to cope with the various traffic patterns. I mean, we use that exclusively in HP. We are probably the biggest Link user of any enterprise. And actually, the productivity and business value that it generates is significant. So I think that's the area that most... And is that how customers are looking at their sort of looking across their application portfolio and saying, all right, where does this apply? And then let's attack that, as opposed to trying to do a big overhaul? And is that a feasible way to approach it? Or is SDN more of a whole house decision? I think it's certainly something that you can look at applying to an existing network. And I know Dom, while I was on yesterday, talking about the various partnerships we have and the technologies options that are available. I think for me, it's critically important that really the customer is looking at the business outcome. The way that we would approach it really is to really start from, what's the business value that you can drive from SDN? What's the difference a programmable network can make to the business? So rather than starting at the technology layer and really looking at, well, how can we insert this bright, shiny thing into an environment? Where's the real business value? And that might take us down the path of, well, let's pick something like Link, which is typically in every enterprise. It's typically something that you can derive some tangible business value from because it's driving productivity of the employees. Or it might lead us down a path that says, well, actually, there is some other business process or transaction that can really benefit from having a programmable network. So for example, at a certain point in a course or a month, you need to provision extra resource for certain transactions. That's a direct business benefit. Exactly. So there's probably no one answer, but are you finding that the business case is primarily IT efficiency driven or it's business, like that example you just gave, end of order? Obviously it's a mix, but many times though, for a technology that's going to have big productivity impacts for the IT department, many organizations will dismiss the sort of softer business benefits. Are you seeing that typically with SDN or because of the whole move toward cloud and agility and the need for speed? Are you seeing that SDN is one of those technologies where people are buying into the software, call them software. Yes. Do you know what I mean by that? Yes. Ones that oftentimes IT people say, well, we can't justify it based on that. So what are you seeing there in terms of the business value? So I would say, I mean, we deliberately, as part of our life cycle services approach, we really try and force a business and IT discussion to happen. So really, we're exposing both the IT efficiency benefits and the business benefits as early on as we can in the engagement. So we have these transformation experience workshops that will be run and you've heard a number of people mention those, I know, but they're very successful at really bringing IT and the business together to really identify where's the value here and I think that that exposes all of the above. Now, in terms of where the real business case is, I would say typically the big driver is really just to speed up the time to value in a legacy network. You might decide something today, but it could take you three weeks or four weeks to actually get it to a point of implementation. In my experience, those numbers dwarf the IT benefits, but then they're so big, people don't believe them. So then they say, okay, can we justify it based on the IT benefits? Yes, if we can, then, oh, wow, we get all this other huge benefit. It's huge, and we know it's there, but we're not going to tell the vendor. We'll get that for free. Where's the action? Is it over the top? Is it just their business model? What's going on in that market that's really driving the NFV opportunity? Is it just pressure, have a mobile infrastructure, all of the above? Give us a quick rundown of where the hot pain points are, where the opportunities are for these guys. Certainly, I think really it's the business pressure that these guys are under. Clearly, big financial pressure coming from a number of different angles, clearly competition in the market over the top, for sure. Again, I think we've gone through a maturity curve with NFV where probably 18 months ago, these were projects in the CTO office of a telco. Which is code for science project, R&D. Exactly, it was a technology project. All the components exist now to build at NFV infrastructure and NFV platform. The telcos and the network of equipment providers who we partner with, over the past 18 months, have really been playing. They've been determining, based on the Etsy reference architecture, where are we going to play, what it's going to look like. We're now getting to the point where companies are seriously starting to look at the deployment schedule. I think this is now a point where they're looking at what's the ownership experience, what's the service experience that needs to go along with the technology solution. There's operational challenges too. I was just talking with David today about just the amount of data that comes out of the telcos customer base just on pure activity record system. In terms of pure big data, it's massive. The gesture data, every single piece of interaction with the mobile device, for instance, it's huge. Operational business model, which one is driving it right now? Both? Would you say equally 50? I just used one example, operational pressure. What do you see there? Which one's driving it most? Is it both? Is it 50-50? I think it's certainly both. I would say it's really the operational pressure that's driving the acceleration and the speed of implementation. We were talking before you came on. It's had been around all the parts of there within HP to do this. When James was talking about data considered care, flex service, all that, and I call it the flex capacitor. It reminds me of that movie, Back to the Future. Flex capacity has been a big hit. Dave pointed it out on our summary yesterday. What's the equivalent version for service providers? They went from zero revenue, James's group to billions, cobbling together different offerings going out and having resonance with the customers. What's the similar approach for you guys with service providers? Is there the same kind of product? Is it different products? What's working and what are you guys focused on? Data center care really is the basis from which we'll develop the ownership experience for the service providers. Interestingly, in my position, I have two views of the service provider. I've got the telco service provider where I'm wearing my network hat. I would say data center care is really a perfect fit for them. The only addition that we all feature that we really need to look at is around SLA and penalties. That's an area where clearly compliance is hugely important. That's table stakes. It's table stakes. It's not just a remediation service is not enough. So that's a really data center care based. Flex capacity is a big deal there, especially for some of the smaller providers too. And then the other angle I look at service providers is more from the service space, so it's the cloud titans, hyper scale guys. They have a different set of requirements. They really are looking at skinning down remediation. They've built such resilience into their software that they don't care if they're concerned about it. But they have a different set of challenges that we have to. Their service is driven, not so much server driven. They have redundancy built in. And also they have different user experience probably, right? Different user service providers. What's the hottest area for you guys? What's growing? What's the hot spots for you guys growth wise? So hyper scale or telco? Well, it's both. I mean, I think for us, with our partnership with Foxconn in the service space, we've really looked to provide credible alternative to white box, ODM providers. And that's got a lot of traction and interest in the market. And that was very much an exclusively available product for a certain set of customers. And clearly there's some interest, I would say, for some of the tier two smaller players on their ability to adopt that technology. But that's growing. It's a tough, very competitive market, but it's one that we're in and we're committed to. And then with NFV, for us, really, it's a complete green field opportunity. It's replacing technology that we've never had in our portfolio. So replacing these proprietary network equipment technologies with essentially enterprise IT, hardened, carry a great enterprise IT. So that's complete green field for us. And we did some really nice business towards the back end of last year. And we think it will accelerate as customers come out of the proof of concept and really start to deploy. So I like the way you've framed it that you start with the business outcome and kind of work backwards from there. But when you sit down to do your three year planning, you obviously are looking at the technology trends, how they're evolving, and how you have to adapt the service experience to exploit those technologies to create the business outcomes. You kind of come back from the business outcome, then go the other way. My specific question is around security. How when you sit down to do your three year plans, how do you look at security and what specific actions have you had to take in order to accommodate from a service perspective that experience and how that's changed and has it changed? And if so, how? So that's a great question. So I would say security, in all of our customer engagement, security is a critical element. And in fact, in all of our sort of advisory and transformational services, we include security regardless of the technology domain or industry vertical approach that we're looking at. We really integrate security into that dialogue. And just to ensure that our customers really appreciate and understand the nuances and the technologies that are available. And clearly as part of the support experience, there's a very important security aspect that we have to maintain. So we partner very closely with our colleagues in enterprise services and in HP software, both of which you have security solutions and very comprehensive solutions for our customers. So we can integrate that into our overall support experience. So again, it's one number to call, hide the seams, that's really the key motivating and customer driver for us in technology services. And they're really making sure that customers have the right connection points into the rest of the industry. Yeah, so it seems like so much of the world of security is going from this sort of, I always say, take the motor around the castle to everybody talks about the network flattening east west. And so security seems to be coming out in as opposed to sort of protecting. So our customers, are they rapidly changing? I mean, it's hard to rapidly change security. It seems like the demands, the information demands are moving faster than the ability security guys to keep up. You know, I look back every year, in January, December and say, okay, you got some really great technology things going on. And I've never felt, you know, more under attack, more exposed. So I wonder, how are customers dealing with that with that tension? And are they moving faster? I certainly I would say based on our customer engagement site, I believe they are moving faster. I mean, it's sort of a business action for many of these customers. So they're being proactive about that being they're being they're being proactive about it. You know, again, there are many alternative solutions on the market. So really our job is to help them navigate that path and be the guide for them, help advise. And yeah, I think they're being very, very proactive. Allison, really appreciate you coming on theCUBE again. Great to see you. I know first thing in the morning, Barcelona, because the clocks are weird here. They have dinner late, they stay out late. A lot of good stuff happened, customer events, you've got your team here. Give me the final word, just quickly summarize what you guys are announcing, the quick story for you guys, get the plug in for what's happening with your group. Well, I think as you will have gathered from the theme of the show, I think our messaging has been very consistent actually over the past couple of years. So, you know, we're really on the path of execution. You know, for TS in Barcelona, really it's about extending data center care. It's about our infrastructure automation, so our partnership with Chef, which I heard you reference in your intro. It's about multi-vendor support and the work that we're doing there really to support the ecosystem, not just the products. And just really our flexible capacity model and the fact that that's something that's growing, very exciting. And we'll continue to see that option next year. Awesome. Again, great stuff with the data center services you guys have, data center care, not going to telcos. Very successful. Congratulations. Again, we had James on yesterday. Business is good in your department. Customers are moving faster now. It's awesome. This is theCUBE. Of course, we're bringing that data, sharing that with you. I'm John Furrier with Dave O'Laughlin. We'll be right back into the short break live from Barcelona. This is theCUBE.