 TheCube at EMC World 2014 is brought to you by EMC. Redefine VCE. Innovating the world's first converged infrastructure solution for private cloud computing. Brocade, say goodbye to the status quo and hello to Brocade. Okay, welcome back everyone. We are live in Las Vegas for EMC World 2014. This is theCUBE, our flagship program. We go out to the events, track the signal from the noise. I'm John Furrier, the founder of SiliconANGLE. I'm Jordan Michael. I'm Dave Vellante, the co-founder of Wikibon.org. We are with Jason Menden, all the EVP of Cloud Switch. Welcome back to theCUBE again. Thanks for having me. Great to see you, I see you in Vegas is your home turf. Yep. Cloud and big data and data centers, all the rage again, it's not going away. Just a quick update on Switch then we'll jump into some specific things. Yeah, so we continue to expand. Back in June, we opened up our next facility, Supernap 8. That's 280,000 square feet, up to 50 megawatts of power. We've already started construction on that nine and that 10, that'll be 650,000 square feet and up to 120 megawatts of power. And the amount of customers that we have coming to that environment leveraging the value of the ecosystem is tremendous. I mean, our vision all along has been not just build an ultra-scale technology data center. It's really about a technology ecosystem where multiple service providers, multiple customers, multiple technologies, they're all present one place and that value proposition is really playing on top of itself now. So you're building these out in Vegas? Yeah, they're all right here in Las Vegas. So is there pressure for you to build out across the globe? There is. Just recently, about, it's about a month ago, we made the announcement, Supernap International has been formed. We're going to be building 10 Supernaps throughout the globe in 10 different countries. So that is now underway. That's been four and a half years, five years in the making. That's not an easy thing to do. When your intellectual property is your building and that's your product, how you protect that, how you structure that, how we create a relationship that'll be meaningful in the local markets. When we get there, that's been the important part of what we've been doing. And you're essentially, people who don't know Switch, I mean, you're essentially housing the world's clouds, right? Well yeah, we've got over 70 different cloud providers and cloud technologies, but most importantly, the bigger part of our customer base is the enterprises. And it's those enterprises, how they're leveraging the cloud services that are really building upon top of each other. So what is the difference? I mean, what are the different requirements between the cloud services guys and the enterprises? Are they very much aligned? Are they quite different? Well, what we know about the cloud service guys is that density equals margin, right? Their ability to get really dense in the data center is super important for them. That equals margin. And so our ability to deliver a very dense product at scale is extremely important for them. The other important thing for them is connectivity. If you're a cloud provider, you got to connect to the outside world. Our connectivity ecosystem is really unmatched in the world from a buying power standpoint. Those things play well into the enterprise as well, but the enterprises tend to not grow in the same way that the cloud providers grow. The enterprises grow in chunks based on projects. Cloud providers grow as revenue increases. And our environment, the way we're able to keep up with our customers allows that to happen. So we've been talking a lot this week about converged infrastructure as a way for either enterprises or cloud service providers to try to replicate some of the values anyway of the public cloud, put it in infrastructure, put it in a block, reduce the non-differentiated heavy lifting and move up the stack and deliver services. What are you seeing in that regard? We're seeing a huge uptake in converged infrastructure. In fact, as we look at enterprises and we see where they've gone, the past two years has been them, I don't know if this is the right word, but they've been dabbling in public cloud, right? They've been putting workloads out there, they've been figuring out how it works, they've been understanding the costs. And one of the great things that I think public cloud has done for enterprise IT is it's forced the enterprise IT organizations to come up with the true cost of IT. In the past, people would say, what's the cost of this? And they would throw out some number and it would be cost accounting and magic stuff and it wasn't real accurate. But what's happened is because there's a bogey out there, they know the number they got a hit. What they've been doing is as they've gone out and leveraged the public cloud, they've realized, well, we look at that cost in the right environment, we think we can do the same for less. And we're seeing enterprises now adopt that, they're bringing converged infrastructure like Vblox into the data center, they're moving workloads from the public cloud into those converged infrastructure environments. And they're basically creating a more value-based service for their internal organizations at a lower cost than they can do in the public cloud. And are you seeing the uptake with things like Vblox in the cloud service provider base as well? Not so, a few cloud service providers. The cloud service providers who tend to be focused around highly compliant, high SLA workloads, they like Vblox. The guys who are kind of going more for the low-cost, low-end commodity-based model, they tend to build more commodity servers, commodity storage. They want Viper. Yeah, they want just stuff. They want it as cheap as possible. And the converged infrastructure plays really well into those high, like the Vblox, plays really well into those high SLA environments. And so they can easily deploy these private environments as well as build out public spaces for that too. Jason, when we first had you on, and it was a VMworld in 2010, if you roll back even probably 2008, 2009, a lot of the activity in the VMware base was test and dev. Much in the same way as we talk about public cloud, generally Amazon specifically, is a lot of test and dev. At the time, Merits came out and said, we're going to run any workload, any application on VMware. And that was a pretty bold statement. And that's basically what happened. You see an Oracle, SAP get virtualized. Will the same happen with AWS and other public cloud providers in your opinion? I think so, we're seeing it. I mean, we're actually watching it happen right in front of our eyes because we've got, if you think about those 70 cloud providers and technologies we have in managed service providers in the data center, we see people pushing workloads into the public cloud, then we see them moving private. We see people doing dev and QA in the public cloud and then they go, oh wait, this works for production really well. And then we're seeing production move into the, into the public cloud as well. So it's this wide array of services that are all being leveraged. And I guess what it comes down to is what we always believed. Even back when we talked to VMworld, we said, look, this will evolve into an and. It'll never be an or, it's going to be an and. And now the challenge is becoming, okay, if I've got V blocks in the private space and I got a public V block that I use and then I maybe use some Amazon over here and I use Joyin over here and I use HP and I got I-Trica and Secure 24 and I've got this service stack of things that I use that are the right solution for the right application. How do I manage that? And we've been watching that orchestration place for a long time and we're seeing some interesting tools come along. I think they're coming to fruition now. They've been in making for like three to four years and now they're really starting to come. So it's not going to be a winner take all. No, no, I don't think so. So Jason and I see HP has some news they're betting a billion dollars on open cloud. They announced they're going after the public cloud market with a variety of enterprise approach with OpenStack, Helian is what they're calling it. Obviously Amazon is the leader. Break that down for us. I mean, you know, the public cloud, Amazon in particular is the leader in public cloud. But you can't just bolt that on the enterprise. HP's trying to play, looks like two worlds, right? They're trying to compete directly with Amazon and public cloud and then use OpenStack as a way to get into the enterprise and you got Pivotal doing their thing with Cloud Foundry. How do you make sense of that? When people say, hey, what is all this mean? So I sit in a unique spot because we get to look at all of these cloud providers and watch what's going on and then see where enterprises are successful and where they're not. Here's what I know. Working in Amazon, they have a big engine. They've got a lot of service points, a lot of services that you can leverage in that. It's very easy to integrate with and it's very meaningful. Now, when you're ready to move that in-house, there's no pathway to that. Amazon is a handcuffing experience and enterprises are starting to experience that. HP Cloud, they're going to take a little bit of a different bent as they head into this OpenStack and frankly, one would argue that rack space back in the day may have been the ones that we're going to take the lead with OpenStack but really the code contributor to the OpenStack framework, the highest code contributor today is HP Cloud. Now, where that will evolve, we don't know but here's what I know. When you move OpenStack in-house, it's still an open sourced environment and every IT manager out there understands what open source means. Open source means I got to have a pretty good set of developers who can continue to evolve the code and OpenStack is creating that kind of problem for the enterprises as they say, well, if I'm on HP Cloud and I'm using it in the public environment as I move it in-house, am I ready for what OpenStack is going to be? And then you got guys like Joyant who have actually said, look, we're OpenStack before OpenStack existed, you got the smart OS and then you got the Vblock which is taking advantage with VCE which is taking advantage of all of those platforms and basically saying, hey, not only can you run VMware environments really well on our stack but now they're starting to certify that stack in other types of environments as well going, look, we're a converged infrastructure that can run a lot of things, VMware being one of them. So you see this landscape and I think that what it means for the enterprise is to understand in the long road what's going to be best for them. What workloads are they really trying to optimize? You know, are you trying to manage this public facing web scale application that has a lot of mobile touch points to it or are you trying to manage some of your enterprise applications in your back office IT and be more effective about the way you deploy as an organization? That balance that will dictate which one is going to make sense for you. With anyone who's working with Amazon the concern I always have is what's next for you? Look at Netflix. What's next for them? Do they continue to enable a competitor by leveraging their infrastructure and how handcuffed are they? Well, we've seen that way though. Yeah, right? Do you just keep enabling your competitor? I don't know. And the other benefit is when you look at these other infrastructure providers out there and I like what VCE is doing with Vblock. I really do. Our enterprise is like what they're doing. You know, we have companies that they order a system. It shows up on the data center floor and within 48 hours they're running workloads on it. And that's not a small footprint. That's a big footprint. You're talking hundreds of terabytes of storage, loads of CPU and processor compute and they do it like that. So you're saying the challenges when you go open stack, you're bringing open source in-house. It's not always easy to find developers. And two, you have basically an engine. You've got to manage that engine like a car, right? You've got to keep it going. And that's challenging as well. Is that the main point? Yeah, that's really what's happening in that area and that's what's causing that. I think what's causing, if I'm an enterprise today, I'm looking at it and I'm going, if I look down the road, that's the thing that may cause me the most grief. Although open stack, I think promises a lot. It's still open source. And open source is open source. It's not a product. Yeah. So final question for you, from the crowd that is asking us from CrowdChat. How challenging is it to replicate the Swiss model to other geos? Las Vegas has been key to your success. You having? Oh yeah, so one of the things that recently happened is that our NAPA facility, we're the first tier four certified design and constructed co-location facility in North America. So although Las Vegas has given us some benefits, the fact of the matter is, it's a tier four certified facility and it's the only co-location facility in North America certified at that level. We're going to take that exact design as we go global and we recognize that there'll be some things around geo and connectivity that we'll navigate as we go through there. But we have 14 years experience in doing this. We know what it takes and we're very careful about how we move forward. It's still going to be meaningful. Jason, thanks for sharing what you know about the cloud. Y'all see EVP at Switch. You have a lot of visibility. You're seeing a lot of traffic at a big facility world renowned. Congratulations. Great to have you on theCUBE again and sharing your knowledge. This is theCUBE. We'll be right back with our next guest live in Las Vegas at EMC. We'll have to this short break. Thanks.