 From around the globe, it's theCUBE with digital coverage of AWS ReInvent 2020, sponsored by Intel, AWS, and our community partners. Hello and welcome back to theCUBE Live coverage of ReInvent 2020 virtual. We're not there this year, it's theCUBE virtual. We are theCUBE virtual. I'm your host John Furrier with Dave Vellante and analyzing our take on the partner day, keynotes and leadership sessions. Today was AWS APN, which is Amazon Partner Network, Global Partner Network Day, where all the content being featured today is all about the partners and what Amazon's doing to create an ecosystem, build the ecosystem, nurture the ecosystem, and reinvent what it means to be a partner. Dave, thanks for joining me today on the analysis of Amazon's ecosystem and partner network and great stuff today. Thanks for coming on. Yeah, you're welcome. I mean, watch the keynote this morning partners are critical to AWS. Look, the fact is that when AWS was launched, the developers ate it up. If you're a developer, you dive right in, infrastructure is code, beautiful. If you're mainstream IT, things just got more complex with the cloud. And so there's a big gap, right, between where I am today and where I want to be. And partners are critical to helping people get there. And we'll talk about the details of specifically what Amazon did, but I mean, especially when John, when you look at things like smaller outposts, going hybrid, Andy, Jassy, redefining hybrid, you need partners to really help you plan, design, implement, manage at scale. Yeah, one of the things I'm always saying nice things about Amazon, but one of the things that they're vulnerable on, in my opinion is how they balance their own SaaS offerings and with what they develop in the ecosystem. This has been a constant challenge and they've balanced it very well. So other vendors, they are very clear. They make their own software, right? And they have a channel. It's kind of the old playbook. Amazon's got to reinvent the playbook here. And I think that's what's key. Today on stage, Doug Guillaume, he's the leader. You had also Dave McCann who heads up Marketplace and Sandy Carter, who heads up worldwide public sector partners. So Dave, interesting combination of three different teams. You had the classic ISVs, partners in the ecosystem, the Cohesies of the World, the EMCs and so on. You had into Marketplace with Dave McCann. That's where the future procurement is. That's where people are buying product. And you had public sector, huge tsunami of innovation happening because of the pandemic and Sandy Carter's highlighting their partners. So it's partner day, it's partner ecosystem, but multiple elements there moving. Marketplace, where you buy, programs and competencies with public sector, and then ISVs. All of those three areas are changing. I want to get your take, because you've been following ecosystems for years and you've been close to the enterprise and how they buy. Your turn. Yeah, and I think John, a couple of things. One is, Dave McCann was talking a lot about how CIOs want to modernize applications and they have to rationalize. And we'll save some of that talk for later on when we have Tim Crawford on. But there's no question that Amazon's out to reinvent, as you said, the whole experience from procurement all the way through. And normally you had to acquire services outside of the marketplace. And now what they're doing is bundling the services and software together. You know, it's straightforward services, implementation services, but those are well understood. The processes are known. You can pretty much size them and price them. So I think that's a huge opportunity for partners and customers to reduce friction. I think the other thing I would say is ecosystems are critical. One of the themes that we've been talking about in theCUBE is we've gone from a product-centric world in the old days of IT to a platform-centric world, which is really about the last decade. It's been about SaaS platforms and cloud platforms. And I think ecosystems are going to be a really power, the new innovation in the coming decade. And what I mean by that is, look, if you're just building a service and Amazon's going to do that same service, you know, you got to keep innovating. And one of the ways you can innovate is you can build on ecosystems. There's all this data within industries, across industries. And you can, through the partner network and through customer networks within industry, start building new innovation around ecosystems. And partners are that glue. Amazon's not going to go in, like Andy Jess even said in his fireside chat. You know, customers will ask us for our advice and we're happy to give it to them. But frankly, partners are better at that nitty gritty hardcore stuff. They have closer relationships with the customers. And so that's a really important gap that Amazon has been closing for the last, you know, frankly 10 years. And I think that to your point, they've still got a long way to go, but that's a huge opportunity in my opinion. Good call out on Andy Jess. I've got to mention that one of the highlights of today's keynote was unscheduled Andy Jassy fireside chat. Normally Andy does his keynote and then he kind of talks to customers and does his thing normally at a normal reinvent. This time he came out on stage. And I think what I found interesting was he was talking about this builder. You always use the word builder, customer solutions. And I think one of the things that's interesting about this partner network is that I think there's a huge opportunity for companies to be customer centric and build on top of Amazon. And what I mean by that is that Amazon is pretty cool with you doing things on top of their platform that does two things. Serves the customer's needs better than they do. And they can make more money on EC2 and other services. Look at Snowflake as an example. That's a company built on AWS. I know they've got other clouds going on, but mainly Amazon zooms the same way. They're doing a great solution. They got Redshift, Amazon's got Redshift, Dave, but also they're a customer and a partner. So this is the dynamic. If you can be successful on Amazon serving customer better than Amazon does, that's the growth hack. That's the hack on Amazon's partner network. If you can pull it off. And I think Snowflake's a really good example. You use Snowflake, you use New Relic as an example. I've heard Andy Jess in the past use Cloud Air as an example. I like Snowflake better as they're sort of thriving. And so, but I would say this, they're a great example of that ecosystem that we just talked about because yes, not only are they building on AWS, they're connecting to other clouds and that is an ecosystem that they're building out. And Amazon's got a lot of Snowflake, I guess unless you're the Redshift team, but generally speaking, Snowflake's driving a lot of business for Amazon. And Andy Jesse addressed that in that fireside chat. He's asked that question a lot. He said, look, we have our primary services. And at the same time, we want to enable our partners to be successful. And Snowflake is a really good example of that. Yeah, I want to call out also yesterday, I had a Monday, I should say Tuesday, December 1st, Jesse's keynote. I did an interview with Jerry Chen with Pralock. He's investing in startups. And one of the things he observed and he pointed out, Dave, is that with Amazon, if you're full all in on the cloud, you're going to take advantage of things that are just not available on say, on-premises. That is data patterns, other integrations. And I think one of the things that Doug you pointed out was with interoperability and integration with say, things like the SaaS factor that they put out there, there's advantages for being in the cloud specifically with Amazon that you can get on integrations. And I think Dave McCann teases that out at the marketplace when they talk about integrations. But the idea of being in the cloud with all these other partners makes integration and interoperability different and unique and better, potentially a differentiator. This is going to become a huge deal. I'm going to pick up on that because yesterday, I wasn't in the keynote. I think it was in the analyst one-on-one with Jesse. He talked about this notion that people, I think he was addressing multi-cloud. He didn't use that term. But this notion of an abstraction layer and how it does simplify things. And he basically said, look, our philosophy is we want to have the ability to go deep with the primitives and have that fine-grain access because that will give us control. A lot of times when you put in this abstraction layer which people are trying to do across clouds, it limits your ability to really move fast. And of course, this big theme is speed this year. At the same time, if you look at a company who was called out today like Octa, when you do an identity management and single sign on and you're touching a lot of pieces, there's a lot of integration to your point. So you need partners to come in and be that glue that does a lot of that heavy lifting that needs to be done. Amazon, what Jesse was essentially saying, I think to the partner network is, look, we're not going to put in that abstraction layer. You got to do that. We're going to do stuff maybe between our own services like they did with the glue between databases. But generally speaking, that's a giant white space for partner organizations. He mentioned Octa, he talked about Infor, AppTO, this was Dave McCann actually, Cohesity came up, Confluent doing fully managed Kafka. So that to me was a signal to the partners, look, here's where you guys should be playing. This is what customers need and this is where we're not going to eat your lunch. Yeah, and the other thing McCann pointed out was 200 new Dave McCann pointed out who leads the leader of the marketplace. He pointed out 200 new ISVs out there, huge news and they got a ton of ready. He went, he talked about this managed entitlements which got my attention. And this is kind of one of those advantage points that it's kind of not sexy and mainstream to talk about but it's really one of those details that's the heavy lifting that's a pain in the butt to deal with, licensing and tracking all this compliance stuff that goes on under the covers and distribution of software. I think that's where the cloud could be really advantage. And also the app service catalog registry that he talked about and the professional services. So these are areas that Amazon is going to kind of create automation around. And as Jassy always talks about that undifferentiated heavy lifting, they're going to take care of some of these plumbing issues. And I think you're right about this differentiation because if I'm a partner and I could build on top of Amazon and have my own cloud I mean, let's face it. Snowflake is a born in the cloud, in the cloud only solution on Amazon. So they're essentially Amazon's cloud. So I think the thing that's not being talked about this year that is probably might come up in future reinvents is that whoever can build their own cloud on top of Amazon's cloud will be a winner. And I talked about this years ago Dave around this tier two I called it tier two clouds. This new layer of cloud service provider is going to be kind of the, on the power law, the second wave of cloud. In other words, you're on top of Amazon differentiating with a modern application at scale inside the cloud with all the other people in there. A whole new ecosystem is going to emerge. And to me, I think this is something that is not yet baked out, but if I was a partner I would be out there planning like hell right now to say I'm going to build a cloud business on Amazon. I'm going to take advantage of the relationships and the heavy lifting and compete and win on that way. And I think that's a redefining moment. And I think whoever does that will win. And a big theme around reinventing, you know everything reinventing industry. And one of the areas that's being reinvented is, you know, the VAR channel really well, consultancies, you know, smaller SIs. For years, these companies made a ton of dough selling boxes, right? All the Dell and the IBM and the EMC resellers. You know, they get big boats and big houses, but that business changed dramatically. They had to shift to value add. So what did they do? They became VMware specialists. They became SAP specialists. There's a couple of examples. Maybe, you know, adding into security. The cloud was freaking them up, but the cloud is really an opportunity for them. And I'll give you an example. We've talked a lot about Snowflake. The other is AWS Glue elastic views. That's what AWS announced to connect, you know, all their databases together. Think about a consultancy that is able to come in and totally re-architect your big data lifecycle and pipeline with the people, the processes, the skill sets, you know, Amazon's not going to do that work, but the upside value for the organizations is tremendous. So you're seeing consultancies becoming managed service providers and adding all kinds of value throughout the stack. That's really reinvention of the partner channel. Yeah, I think it's a complete channel strategy that's different. It doesn't, it looks like other channels, but it's not, it's driven by value. And I think this idea of competing on value versus just being kind of a commodity play is shifting. I think the ISVs and the VARS, those traditional markets, Dave, as you pointed out, are going to definitely go value oriented and you can just own a specialty area because as data comes in, and this is interesting and one of the key things that Andy Jassy said in his fireside chat when asked directly, how do partners benefit when asked about his keynote, how that would translate to partners? He really kind of went in, he was kind of rambling, but he hit the chips. He said, well, you got our own chips, which means it's compute. Then he went into purpose built data store and data elastic views, SageMaker, Q and QuickSight. He kind of went down the road of, we have the horsepower, we have the data lake, data, data, data. So he was kind of hinting at innovate on the data and you'll do okay. Well, and this is again, we kind of, I'm like a snowflake fan boy, kind of in the way you like AWS. But look, if you look at AWS glue elastic views, that to me is like snowflakes data cloud, different. A lot of pushing and moving and data, a lot of copying data, but this is a great example of where, like remember last year at re-invent, they said, hey, we're separating compute from storage. Well, you know, of course snowflake popularized that. So this is a great example of two companies thriving that are both competitors and partners. Well, I got to ask you, you and I always say, we kind of hit stories. We've been around the block on the enterprise for years. Where do you mark the evolution of their partner number? Because again, Amazon's been so explosive in their growth, the numbers have been off the charts and they've done it well with IaaS and PAS. And now you have the pandemic, which kind of puts on full display digital transformation. And then Jassy telegraphing that the digital global IT spend is their next kind of conquering ground to take. And they got the edge exploding with 5G. So you have this kind of range and they're doing all kinds of stuff with IoT and they're doing stuff on earth and in space. So you have this huge growth and they still don't have their own fully SaaS oriented business model. They rely on people to build on top of Amazon. So how do you see that evolving in your opinion? Because they're trying to add their own Amazon only. We got Redshift that competes with others. How do you see that playing out? So I think it's going to be specialized. And something that I've talked about is Amazon, AWS and the old days being last decade, they really weren't that solution focused. It was really serving the builders with tooling. If you look at something like what they're doing in the call center and what they're doing at the edge in IO2, I think their move up the stack is going to be very solution oriented, but not necessarily horizontal going after CRM or going after supply chain management or ERP. I don't think that's going to be their play. I think their play is going to be to really focus on hard problems that they can automate through their tooling and bring special advantage. And that's what they'll SaaS. And at the same time, they'll obviously allow SaaS players. It just reminds me of the early days when you and I first met of VMware. Everybody had to work with VMware because they had such a big ecosystem. Well, the SaaS players will run on top like Workday does, like Salesforce does, and Infor, et cetera. And then I think, and you and I and Jerry Chen talked about this years ago, I think they're going to give tools to builders to disrupt the service nows and the sales forces who are out buying companies like crazy to try to get half a billion, half a trillion dollar market caps. And that is a really interesting dynamic. And I think right now they're not even having to walk a fine line. I think the lines are reasonably clear. We're going up to database. We're going to do specialized solutions. We're going to enable SaaS. We're going to compete where we compete. Come on, partner ecosystem, and we'll see you in five years. I think that the Slack being bought by Salesforce is just going to be one of those, I think it's a web van moment where it's like, okay, Slack is going to go die on Salesforce. Okay, I get that. But it's just old school thinking. And I think if you're an entrepreneur and if you're a developer or a partner, you could really reinvent the business model because if you're disaggregating all these other services, like you can compete with Salesforce. Slack has now taken out of the game with Salesforce. But what Amazon is doing with, say, Connect, which they're promoting heavily at this conference. I mean, you hear it on Andy Jatsy's keynote, Sandy Carter, they've had huge success with AWS Connect. It's a call center mindset, but it's not calling just on phones, it's contact. That is disintermediating the Salesforce model. I think when you start getting into specialists and specialism in channels, you have customer opportunity to be valuable. And I think call center, these kinds of services that you can stand up pretty quickly and then integrate into a business model is going to be game changing. And I think that's going to put a lot of threat on these big incumbents like Salesforce, like Slack, because let's face it, bots is just the chat bot, it's just a call center front end. You can innovate on the audio, the transcriptions. There's so much Amazon goodness there that Connect isn't just a call center. That could level the playing field in every vertical. Well, and SaaS is getting disrupted to your point. I mean, you think about what happened with Oracle and SAP. You had these new emergent players come up, like Salesforce, like Workday, like ServiceNow, but their pricing model was all the same. We lock you in for a one year, two year, three year term, a lot of times you have to pay up front. Now you look at guys like Datadog, you look at Snowflake, you look at Elastic, they're disrupting the splunks of the world. And that model, I think that SaaS model is ripe for disruption with a consumption pricing, a true cloud pricing model. You combine that with new innovation that developers are going to attack. I mean, people right now, they complain about ServiceNow pricing, they complain about Splunk pricing. They talk about, oh, Elastic, we can get that for half the price, Datadog. And so, I'm not predicting that those companies, ServiceNow, Workday, the great companies, but they are going to have to respond much in the same way that Oracle and SAP had to respond to the disruption that they saw from the cloud. Yeah, it's interesting during the keynote, they always talk about going after the mainframes today too, so you have Amazon going after Oracle, Microsoft, and now the mainframes. So you have Oracle Database, SQL Server, and Windows Server all being old school technologies and now mainframe. Very interesting, and I think this whole idea of this SaaS factory got my attention, Cohesity, which we've been covering, Dave, on the storage front, Mo with the founder was on stage, talking about data management as a service. They're part of this new SaaS factory thing that Amazon has, and what they talk about here is they're trying to turn ISVs and VARs into full-on SaaS providers, and I think if they get that right with the SaaS factory, then that's going to be potentially game-changing. I'm going to look and see what the successes are there because if Amazon can create more SaaS applications, then their TAM and the global IT market can be mopped up pretty quickly, but they got to enable it. They got to enable that quickly. And enabling to me means not just, and I think when Jassy answered your question, I saw it in the article that you wrote about, you asked them about MultiCloud, and to me it's not about running on AWS and being compatible with Azure and being compatible with Google. No, it's about that frankly abstraction layer that he talked about, and that's what Cohesity's trying to do. You see others trying to do it as well, so no flake for sure. It's about abstracting that complexity away and adding value on top of the cloud. In other words, using the cloud for scale, being really expert at taking advantage of the native cloud services, which requires, is that Jassy was saying, different APIs, different control plane, different data plane, but taking that complexity away and then adding new value on top, that's white space for a lot of players there. And I'll tell you, it's not trivial. It takes a lot of R&D and it takes really smart people, and that's what's going to be really interesting to see shake out is, can the Dell and HPEs, can they go fast enough to compete with the Cohesities? You got guys like Clumeo coming in that are brand new. Obviously we talked about Snowflake a lot and many others. I think there's going to be a huge change in expectations, experience, huge opportunity for people to come in with unique solutions. We're going to have specialty programming on theCUBE all day today. So if you're watching us here on the Amazon channel, you know that we're going to have all this on demand. There's a little link on our page on the Amazon re-invent virtual event platform. Click here at the bottom. It's going to be a landing page. Check out all the interviews as we roll them out all day. We got a great lineup, Dave. We got Nutanix, Pure Storage, Big ID, BMC, Amazon leaders, all coming in to talk today. Chaos Search, Ed Walsh, Rachel Rose, MediCar, Kumar, Mike Gillflex, tons of great, great partners coming in. And they're going to share their story and what's working for them and their new strategies. And all throughout the day, you're going to hear specific examples of how people are changing and reinventing their business development, their partnership strategies on the product and go to market with Amazon. So really interesting learnings. We're going to have great conversations all throughout the day. So check it out. And again, everything's going to be on demand. And when in doubt, go to thecube.net. We have everything there at siliconangle.com for all the great coverage. So... Now the other thing, John, is we're going to have a conversation later. And Dave McCann touched on this. He talked about the need for modernization and rationalization. Remember Tim Crawford on later. And this is sort of the call out that Andy Jassy made in his keynote. He gave the story of that one CIO, was a good friend of his, who said, hey, I love what you're doing, but it's not going to happen on my watch. And so Jassy's sort of poking at that complacency, saying, guys, you have to reinvent. You have to go fast. You have to keep moving. And so we're going to talk a little bit about what does that mean to modernize applications? Why do CIOs want to rationalize? What is the role of AWS and its ecosystem in providing that level of innovation? And really try to understand what the next five to seven years are going to look like in that regard. You know, it's funny you mentioned Andy Jassy with that story. When I had my one-on-one conversation with him, he was kind of talking about that anonymous CIO. If people don't know Andy, he's a big movie buff too, right? He loves, goes to Sundance every year. So I said to him, I said, this error of digital transformation is kind of like that scene in The Godfather, Dave, where Michael Corleone goes to Tom Hagan. You're not a wartime conciliary. And what he meant by that was is that, you know, they were going to war with the other five families. I think now, and I think this is what Jassy pointed out is that this is such an interesting, important time in history. And he pointed this out, if you don't have the leadership chops to lean into this, you're going to get swept away. And that story about the CIO being complacent. Yeah, you didn't want to shift and then a new guy came in or gal and they, and they, they lost three years, three years of innovation. And the time loss, you can't get that back. And during this time, I think you have to have the stomach for the digital transformation. You have to have the fortitude to go forward and face the truth. And the truth is you got to learn new stuff. So the old way of doing things. And he pointed that out very aggressively. And I think for the partners, that same thing is true. You got to look in the mirror and say, where are we? What's the opportunity? And you got to, got to go there. If not, you can wait, be swept away, be driftwood as Pat Kelsinger would say, or lean in and pick up, pick up a shovel and start digging the new solution. You know, the other interesting thing, I mean, every year when you listen to Jassy and his keynotes and you sort of experience, reinvent, culture comes through. And John, you're living in Silicon Valley. You talk to leaders of Silicon Valley. You know, what's the secret of success though? Nine times out of 10, they'll talk about culture. Maybe 10 times out of 10. And, and so that's, that comes through in Jassy's keynotes. But one of the things that was interesting this year, and it's been thematic, you know, Andy, you know, repetition is important to him because he wants to educate people and make sure it sticks. One of the things that's really, he's been focused on is, you actually can change your culture. And there's a lot of inertia. People say, well, not on my watch. Well, it doesn't work that way around here. And then he'll share stories about how AWS encourages people to write papers. Anybody in the organization say, we should do it differently. And, you know, they have to follow their protocol and work backwards and all of those stuff. But I believe him, when he says that, they're open to, we have a great example today. He said, look, if somebody says, well, it's 10 feet and somebody else says, well, it's five feet. And he said, okay, let's compromise and say it's seven and a half feet. Well, we know it's not seven and a half feet. We don't want to compromise. We either want to be at 10 or we want to be at five. Which is the right answer. And they push that and that's, he gives examples like that for the AWS culture, the working backwards, the frequently asked questions documents. And he's always pushing. And that to me is very, very important and fundamental to understanding AWS. It's no doubt that Andy Jess is the best CEO in the business these days. If you look at him compared to everyone else, he's hands down, more humble, his keynote. Who does three hour keynotes the way he does? With no notes. With no, he memorized it all. So he's competitive and he's open. And he's a good leader. I think he's a great CEO. And I think it'll be written and look back on history this time in history. The next, I think post COVID Dave is going to be an error. We're going to look back and say, the digital transformation was accelerated. Yes, all that good stuff. People process technology. But I think we're going to look at this time, this year and saying, this was the year that there was before COVID and after COVID. And the people who change and modernize will be winners and the losers will be sitting still. So I think it's important. I think that was a great message by him. So great stuff. All right, we got to put, we'll leave it there, Dave, the analysis. We're going to be back with a power panel, two sessions from now. Stay with us. We've got another great guest coming on next. And then we have a para panel talking about the marketplace pricing and how enterprises and CIOs are going to be consuming the cloud and their ecosystem. This is theCUBE. Thanks for watching.