 Okay, we're back. This is Dave Vellante. This is theCUBE, siliconangle.tv's continuous coverage of IBM Edge. We're here in Orlando. This is IBM Storage Coming Out Party. And we've been talking to a lot of the executives within the storage group. But now we have a special segment. Mike Silvia is an IBM Distinguished Engineer, but he's inside the CIO office. So we're going to switch gears a little bit and talk about what a practitioner wants from infrastructure, cloud, autonomic activities and automatic automation. Mike Silvia, welcome to theCUBE. Hi, thank you. And we're here with John MacArthur. Hi, Joe. Hi, good to be here. He's a colleague and friend and John is co-hosting along with John Furrier this week. So first of all, Mike, IBM Edge looks like quite a nice little coming out party. It is, absolutely. It's a great opportunity, I think, for people like myself. I mean, I do work for IBM, but I work very similar to many of the attendees here who don't work for IBM in IT in order to provide the processing capability that they need to run their business. So a lot of the CIOs we talk to talk about transformation. Many are focused on transforming the infrastructure, many on the applications, the development of the portfolio, and many are moving toward this notion of a service catalog. IT is a service, heavy use of not only virtualization, but also bringing in kind of reusable services and menus of services. Is IBM going through a similar transformation? Yeah, absolutely. We've had standard facilities particularly for hosting, standard offerings for hosting for some time now. More recently, starting about two years ago, we began a major initiative to put in place a formal service catalog, definition of and process around an assortment of offerings that we can make available through that. It's a long journey, and we're far from complete, but it's been a very good thing for us. What's your biggest challenge with, I presume your vision is IT as a service, as many IT organizations. What's your biggest challenge with regard to fulfilling that vision? Well, I think certainly one of them is that IT is an area that's grown up more of a craft rather than as something that people use in a standard mode. And as a result of that, we find that there's a lot of cultural resistance and otherwise because that's a great idea, but start with somebody else first is very prevalent. So for us, certainly IT as a service implies that you're willing to use, consume things that are put up as a standard kind of a service. And that's a real cultural change, and I think many customers go through the very same thing. So Mike, talk about some of the cool stuff that you're doing around infrastructure management. What's exciting you these days? Well, I lead a team in IBM that provides both the strategy and then specific definition of solutions architecture for all of our infrastructure. So that would include our hosting environments, our network, our disaster recovery, certainly storage, cloud, voice services, et cetera. It's a very complex area. So they're all very interesting to us. You know, we're like anybody, we're focused on some of the big things that everybody else seems to be working on today. Those would include the cloud. Cloud is a big initiative for us that we're working on to try to both maximize our flexibility as well as to sort of control costs. Enter transition, as you said, Dave, the movement towards IT as a service. So that's certainly one of our bigger ones. Other ones are certainly around networking, voice services. Voice is an area that I think is extremely complex and in some sense one of the last frontiers where we have an opportunity to really change things in a dramatic way that really hasn't occurred in the past. And with the convergence of data and voice, there are all sorts of opportunities that are coming with that, along with all the other things around smart. Can you give us an example of something that's sort of interesting there for you? Yeah, I mean the fact that you can now easily use almost any device, you know, whether it's a PC or smartphone, whatever, as a phone as well. I mean, a smartphone, you would expect it to do that. But I could use the data side of a smartphone and use the soft phone capability that I might produce for that and not even use the analog part. And in many cases, I can save a heck of a lot of money. Think for example of the IBMer who might be traveling to another location, another country, and first off, having to figure out how do I even make a phone call, right? How do I make a phone call to get into that conference call that you could be on or something like that? You know, and it's very different in every country and how do I do it with my phone? And then of course, one of the last things, understandably, they'll look at is, how do I do that optimally from a cost standpoint? They just want to make the call, which is perfectly understandable. If they pick the wrong one from a cost standpoint, it could be extremely costly. And does security play a role in that as well? Well, it can, it certainly can. So one of the things we're trying to do though is to produce a one phone service that builds on all of these technologies, soft phone and other things. So it might integrate Skype and Google Voice and all those kinds of things. And my landline and my cellular into one sort of converged communications. And that would provide an easier use model for IBMers to consume, but it would also provide us an ability to help control costs in that environment. So looking for it, it's very complex. So I'd love to talk about to practitioners within a large organization, technology company like IBM about what we sometimes call the dog fooding segment, right? Although we were at SAP Sapphire a couple of weeks ago and Oliver Busman, the CIO of SAP said, well, SAP were kind of a European company. We prefer drinking your own champagne, not eating your own dog foods. So talk about some of the things that you might be doing that are either in concert with the storage group. How do you act as a surrogate for the customer, proxy for the customer? Are you sort of an advanced testing team? Do you go into beta? Or what's the relationship there? And what are some of the things that you're doing with the technologies that are coming out of this group? Well, first off, first and foremost, we are a production shop. And so we're in business to run the IT that runs the corporation. But at the same time, we're always looking for opportunities to showcase. And for the most part, we almost entirely use IBM products and services and services actually. So we actually use our global business services, global technology services, their offerings to come in and do consulting as they do for any other customer. So we're very big on that. And in the storage space, we're particularly big. We use entirely across the board, IBM storage products like their DS8000, and more recently the XIV and V7000 from a hardware standpoint. We're very big on all the Tivoli Suite software that does all the storage management aspects. One of the things I'm gonna talk about later in the main tent is a smart tiering capability that is actually being announced as a part of the Tivoli product line today, beginning to be announced as target. And to your point, we do occasionally become the guinea pig that actually ends up producing things that end up in product. We took some existing storage products, both from a software and hardware standpoint, combined those with our colleagues in IBM research, who built us some assets to do the smart part of that, to organize the automated tiering parts. And that's what's actually ending up in product in us today. So system-managed storage has been around since IBM invented it in the... And I'm sad to say it was been around long enough to have seen it too. Right, so how is this different? How is this, is this better, what's the focus? It's sort of similar to that, although this doesn't include the archiving portion that you're thinking about there. What is different about this, it's a little more dynamic, in the sense that it's looking constantly for what the utilization patterns are of data against some set policies that we have and moving volumes of data up and down a blended hierarchy based on a profile of cost and performance. So it'll look at data and it'll say, at this utilization level, that should be on this tier with this cost and performance profile, et cetera. Some have argued that that sort of capabilities are really important for cloud-based storage. So one of the problems with cloud-based storage offerings today is they tend to be capacity-based pricing. That necessarily performance, not necessarily availability, quality of service, but it's like, I need X number of gigabytes. Do you see an opportunity for IBM longer term to sort of actually get into those opportunities or is that left to the start-ups? I think that it will. I mean, we're currently implementing it internally with a blended price. So we've determined one of the things of software that we have. You sell as a blended price, not a quality of service. We're using it, consuming it internally at a blended price from our own provider. The other part of the IBM corporation that does delivery. But we've actually used that in determining what's an appropriate mix and they've given us a blended price for that. Now, we love it because it has cut our price with bite in half. We've gone from what we used to be considerably more expensive. That's going to help us mitigate what we are already experiencing like most users, exploding growth. Do you guys do chargebacks or showbacks? We do chargebacks internally. We do at a pretty granular level. Yes. Okay, so you're operating from that standpoint as a service. Absolutely. Everybody says they want to get to IT as a service and I say, do you do chargebacks? Only about 15% of the people we talk to actually do chargebacks. That's a business model that you've been doing. Now, how about consuming on a pay-as-you-go basis as a practitioner? How advantageous is that to you? I guess it depends on your economic model whether or not your CFO wants you to do shift-cap-ex to op-ex, but can you talk about that a little bit from a practitioner's point of view? How alluring is paid by the drink? Well, I think from a practitioner's point of view, it's very alluring. Whether it makes sense over the long term, I think it may vary. Because renting is more expensive than buying. Because renting can be more expensive than buying, right? I mean, we've all faced those things in our daily lives that we make those decisions. There are times when you take the cab and there are times when you buy a car. And it's going to depend. The answer, if it's a long-term need I have, I might be better off just to do it in the traditional way. If it's something that I'm going to have certainly a spiky or an occasional or just one time, then I'm much better off to do the pay-by-the-drink. Practitioner may not think about that whole equation. So IBM offers actually, I think it's got an object storage service where you can pay by the drink. Do you actually consume that service if you know what it's going to cost? We do in a small part of our application portfolio. For the most part, we use a lot of it in a traditional sense for our production work because that's all pretty standard traditional hosting at this point. What are you guys doing in the area of, and I know you're focused more on the infrastructure, but talk about big data and the implications that has from an infrastructure practitioner standpoint. Yeah, so in terms of the analytic capability, we have a gigantic sort of a software as a service cloud that we built internally called Blue Insight used by some 200 plus thousand IBMers. It's enabled us to provide a very handy single sort of place to go for an analytic capability against over a petabyte of federated data around the corporation. So that I think is a good example of the sort of thing that we've both used some other IBM product to produce that but also as an analytic capability. It's also enabled us to reduce our dependence on a lot of one-off applications that were built to both maintain and provide access and analytic capability against a bunch of data. So that's a self-service capability? It is a self-service. And is that the trade off between sort of data mart and data warehouse? Yeah, absolutely. Thanks, so you're actually creating a data warehouse that can be accessible like a data mart, almost. Right, yes. Very business unit focus. All right, we're out of time here. Mike Silvia, that was fantastic. We really appreciate the buyer's perspective. Mike Silvia, Inside IBM CIO office. This is theCUBE and we're at IBM Edge. We'll be right back after this work.