 Live from New Orleans, Louisiana at theCUBE. Covering .NEXT Conference 2018 brought to you by Nutanix. One of the only constants in the technology world is that everything is always changing. Talking a lot about digital transformation. If I roll back to 2012, converged infrastructure, changes in data centers and infrastructure where all of the buzz. And it was before we were talking about things like hyper-converged infrastructure. We ran across a company called Nutanix. First interview we did in 2012 with D. Raj Pandey, the CEO of the now public company surprised us a little bit in that not how they put things together but the why and what they had behind it. That almost 40 minute interview which John Furrier and I did really talked about the biggest challenge of our time is distributed architectures. Not about boxes, not about even just reconfiguring as some of the silos, but really some of the software challenges that we've been attacking for decades really in our industry. Fast forward, here we are in 2018 and want to welcome you to theCUBE's coverage of Nutanix.NEXT Conference here in New Orleans. I'm Stu Miniman joined by my co-host for these two days of broadcast, Keith Townsend. Keith, thanks for joining me. Thanks for having me Stu. So, you know, we spend time, you know, it's like, well, what are we doing today? It's, you know, I think, you know, right down the block from here is the World War II monument. You know, how many years after World War II before it was called World War II? It's like, yeah, good point. You know, so, you know, when we look back at what was happening, converged infrastructure was a wave. At Wikibon, we were tracking, you know, cool things like flash really invading what's going on. Hyperscale architectures. For me personally, I'd gone from looking at, you know, these enterprise architectures really hardware focused, failure domains, make sure that nothing ever breaks to the software model of applications where you expect everything's going to break. And that's okay. Chaos monkey rules supreme. At the end of the day, your application lives on, you know, much more granular. We weren't talking micro segmentation architectures and the like. So, want to bring you in here, you know, we've had the pleasure of, you know, being at every single Nutanix show. This is your first one for you. So, give us, give us your first impressions of Nutanix.next and, you know, what you're seeing. So, I go to an awful lot of shows. And I've heard that Nutanix.next was special in all, to itself, had breakfast with just customers, regular attendees. And there is slightly a different energy here. I was surprised at how open customers are about talking about their journey. Just talking about how they're using Nutanix, where they have it deployed, their origin stories, much different atmosphere than many of the conferences that I've attended. Yeah, and actually, so when you talk software companies, there's certain shows where there's that passion and love. Keith, you and I, you know, cut our teeth on the virtualization community. Right. I used to have the I love VMware bumper stickers and things like that. We've got a team at Service Now Knowledge. Dave Vellante said it's one of the most passionate groups there. And it's interesting, some of the board members of Nutanix actually co-populate with what's going at Service Now. Another show we have going on this week is Red Hat. Obviously the open source community, very passionate communities. The goal that Nutanix has is rather audacious. You know, when they set out, it's not like they said, hey, we want to be the leading hyper-converged infrastructure player, but they started in 2009. That word didn't even exist in our lexicon. They have a rather audacious goal. They want to be, you know, the next VMware in the model of Microsoft platform. What do they own? Where does it fit? What does their ecosystem look like? And we've been watching this maturity. We're going to have a lot of guests, customers, partners and executives. But yeah, okay, comments there. Yeah, you know what? The goal is $3 billion in software buildings by 2011. I mean, sorry, by 2021. That is a big, big number. I think VMware revenues are somewhere around 8 billion to put this into perspective. Big ambitions. I think on stage, Sunil said that Nutanix is the world's best or leading cloud OS. That was a bold, bold statement. So while one part of the Nutanix is a lot of bravado, best with some pretty decent technology, customers, the customers that we've talked to have said, you know what? They have not ran into a more humble company and wanting to build brick by brick a relationship to help solve and surprise that customers use this word. Partner, they believe Nutanix is truly a partner in their journey towards cloud and delivering IT services. So while, again, very bold from a financial statement, very bold from a technology statement, the customer passion here about Nutanix being a true partner in their journey is less quite real. Yeah, and it's interesting. When you look at the pace of change, the half-life of how long people love a brand has been shrinking very fast. I think of the old days, it was like, you know, brands like IBM and Microsoft had decades that they were in love. You know, Apple, you know, still beloved by many, but you know, they get poked and poked and prodded. You know, we talked about VMware, talked about Nutanix. The landscape today is one of the things. Let's talk about cloud for a second. So, you know, you and I were making some comments in the Twitter stream during the keynote. When I think hybrid cloud and I think who's got leadership there, well, first of all, you can't talk about cloud without talking about AWS. Right. First solution that anyone's going to support, the Amazon, the Nutanix solutions, it's either API compatibility or integration with what Amazon is doing. Secondly, you talk about hybrid. That's Microsoft strategy from day one. Azure, Azure Stack, same OS, same operating model that's there. So, for Nutanix to say they have the best, it's like, well, Microsoft's been doing this for a few years. They have a few more customers than Nutanix, so. Right. Not saying Nutanix is not doing great, staff, they're adding 1,000 customers a quarter, which is great for an infrastructure company, for a software company. It's good. Yes. It's, you know, not like, you know, blowing it out of the water. It's, you know, if you're a sales force and you said you're only adding 1,000 new, you know, okay, companies a quarter, it's like, well, Wall Street's not thrilled. So, different space, how they're positioning themselves. I mentioned revenue. They're well over a billion dollars. I was looking back some of the shows we've done. They're like, I think it's like a $1.4 billion run rate. Market cap, a phenomenal $9 billion. When we talk about just value creation, the customers that they're doing, you know, a lot of things really, you know, in the Nutanix, you know, tailwind pushing them along. As you said, coming to these shows, it's always when you talk to the customers, when you talk to the customers in the hallway, you know, are there certain things that's like, oh, well, we're glad the micro segmentation stuff was something that, you know, we really wanted, but not, you know, the big gripes. They're not, you know, yet complaining about, you know, the pricing models. The tech, there's not a Nutanix tax yet, not a HV tax, you know, and it'll be interesting. They made a lot of announcements today around calm, around flow, around database management. A lot of features, extremely ambitious technically. And as, you know, those technologies have to be paid for somehow. So long-term, I really want to see if that love extends into when Nutanix needs to get to that $3 billion in revenue. Yeah, so maybe, you know, a quick take on the announcement so far and the keynotes, I thought it was a good balance, a little bit of Patentry up front. Mardi Gras, you know, the marching band. The marching band and everything coming through. They had partners, hackathon winners, customers up on the floats coming in, no beads, probably for, you know, wanted to make sure that they weren't pegging somebody in the head with that stuff, but they had a good mix. I felt they had a few customers on stage telling their stories. They got through the announcements, you know, some real meaningful announcements. Their first SaaS product with Beam, one of the four acquisitions that they've had over the last couple of years. That was from Minjar, was the acquisition. Netsul is another acquisition that they had recently. And then Calm was the basis along with Pernick's data a couple of years ago. Sachin Vagani's Pernick's data, somebody working on the IoT and Edge stuff. So yeah, keynote announcements, what's your take? You know what, there's a lot there. From a period, they are innovating extremely fast. I think I interviewed Dyrich, maybe a couple of years ago at Dell EMC World. And I asked, is Nutanix a platform yet? And he said, you know what, we might be a little bit early to call Nutanix a platform. I think today we've solved the completion of the foundation of being called a platform. As we look out onto the show floor, we're starting to see a growing number of partners who are looking to integrate. We'll have Veeam on later on in the program. But specific announcements, you know, the things that I'm somewhat excited about. Netsul, they're taking a very different approach to network segmentation and the micro segmentation than VMware is. There's some advantages, disadvantages. Really looking forward to having that conversation. One click database management with Oracle and Microsoft, you know, there's kind of some guard rails around that that we're thinking, wow, how does Nutanix walk the line of making database administration deployment simple, but not anger Oracle to the point that there's court action. That's going to be an interesting set of conversations. Yeah, I mean, Keith, you know better than me, you know, I hear database migrations and I just, you know, think of all the customer horror stories. David Fleuer from our Wikibon team, you know, has talked about, you know, it's never easy. You'll get 80 or 90% of the way there and then things break and you have to put it back together. AWS has been doing a lot of database migrations and, you know, they've got, you know, 80, 90,000 of these that they've done. So, you know, how do they do this? You know, it's great to say, you know, push button simplicity, but you know, the proof is in the pudding. What are customers saying? Yeah, well you're talking about big database mission critical. And that's another thing we heard on the stage this morning. A lot about mission critical, that they're trying to shed this, this persona of being a VDI platform and that the platform is ready for mission critical applications. We've talked to customers that are indeed using it for mission critical stuff. But again, migration, they've had the relationship with IBM and Power for a couple of years now and they'll run into a lot of customers that are saying they have no plans of moving AIX to Nutanix. However, there's a plate. Yeah, well, since you mentioned it actually, that was one of the announcements today. Nutanix is now supporting the AIX. So before it was power, I need to get over to Linux and that's something we've heard. Josh Keith, how long have we been hearing the migration from Unix to Linux with the workload? 10 years ago, I remember going to events and we were talking about that and it's challenging. You need to re-platform, retool. Having IBM support Linux on mainframes and thinking, man, I can finally get this stuff off of AIX and into Linux and that was literally almost 20 years ago. So there you go. Yeah, so many different announcements. Let's start at the basic piece of it because if you talk, there are customers that they have that are drawing all the new things. We've got one of the customers that was on the keynote stage in Northern Trust and he's throwing out things like Paz and CAS which I'm hoping is containers as a service that he's talking about. Some of us propeller heads love talking about this. Lambda got mentioned in the keynote talking about serverless but the average Nutanix customer, this is the sand replacement. Many of the customers come and they say, going from my three tiered architecture, server, storage, whether that be a traditional storage array or even an all flash array, I'm going to save 20 to 40% just by collapsing it down to this architecture. Multi-hypervisor, VMware, of course, very heavy. Interesting dynamic always between VMware and Nutanix. AHV growth, a little bit less of the AHV, the cropless hypervisor and surrounding a cropless services. At least to me it felt a little bit less than before just because the portfolio is broadening but you've got so many pieces. It's a lot of different, basically almost any server you want. Nutanix is either an OEM or they will support it. There's all the hypervisors, they can connect to the cloud. When I look at that hybrid cloud message, it does start in your data center but it does extend to all of those pieces. It's, if there's a little criticism I have there, it's that, at least my quick take, 50 to 75% of the Nutanix customers are mostly of the, I use SaaS but I don't use a ton of public cloud and therefore I want to control my environment as opposed to, but there are other customers that are, I'm doing a ton of Amazon and Nutanix is great there. So went on about a bunch of things there but just the base platform, what do you hear from people that are using Nutanix specifically, HCI in general and how that fits into the overall cloud picture? So overall, they're cautious. Like you said, a lot of these, a lot of what core customers that I've talked to are very, let's call it cloud, anti-pattern. However, they're consuming calm, they're consuming prism, they're consuming Nutanix in a cloud-like manner on premises. So they're looking to, I think one customer said to his, to their internal customer, they are the cloud. They make IT and consuming Nutanix infrastructure simple. So, you know, it is a perspective thing. As we start to expand out calm and expected, XI become much more critical to this long-term vision and customers are still in a wait-and-see pattern. They're saying, well, let's look, one to two years where the technology gets to be a little bit more mature, little bit more tested, tested by who is a good question and that ability to extend their internal infrastructure and operations to the external public cloud becomes more of a reality. Okay. Keith, I want you to just, you know, what are you looking for to get out of these next two days? Quick take from me, the three pieces that Sunil and Dear Raj have been talking for a couple of years. Invisible infrastructure, solid basis, they're there, they've got, you know, great feature functionality. I think when we talked to customers, they were like, you know, other than these two features that VMware has that aren't yet here, you know, I can move 75 to 85%. AIX is, you know, one piece to get, you know, another 5% of that if we need. Invisible data centers making good progress. You can see what they're doing today. They have a lot of the pieces, things like Prism and Calm are, you know, Prism have been out for years, but, you know, Columns GA and making progress. And then Invisible Clouds, first pieces are in place. They've got some software pieces there. You know, what do we look at Nutanix, you know, three to five years from now? Are they a SaaS player? Are they primarily an infrastructure software player? Question I want to point to them. I had an interview with Rowan from Cisco, the number two guy and he said, you know, Cisco, the networking company, 10 years from now, they're a software company. Like it's not boxes and ports and things like that. So how far do they go? As opposed to you and I were at Dell last week. Dell wants to be the leading infrastructure company and therefore, you know, servers, storage, network are key pieces there. Tie into software, tie into cloud, but that's my quick bake down is what I'm looking for. The progress that they're making is we always sniff death. What's real? You know, what has some work? Marketing's okay as long as the proof's in the pudding. So we heard a lot about the vision. Enterprise Cloud Company is the tagline. They, that is part of the company's brand. I want to understand how they make the claim, not just how, how and why they make the claim. They are the leading enterprise cloud company. What does enterprise cloud mean to them when they say that? And you can't have a conversation about enterprise cloud without talking about the developer. So Nutanix by saying that their enterprise cloud company is, you know, they're going in the opposite direction, especially of Dell EMC. Dell EMC provides infrastructure to cloud companies. They might punt to Pivotal and VMware as being the software components of a complete cloud strategy, but Dell EMC itself, infrastructure company. Nutanix is making the claim they're an enterprise cloud company. How are they pursuing the relationship and capability with developers, infrastructure team, operations to make sure that they can kind of live up to that mantle? Yeah, Keith, great point to help us wrap. One of the segments we heard talking about edge computing, Nutanix wants to make invisible. Kubernetes TensorFlow functions as a service made my hands spin a little bit because we know the maturity of those solutions and what you need to do to understand it. So being able to simplify that, well, that would truly be genius. That would. If they can Nutanix fives that, that would be great. All right, well, Keith Townsend, the CTO advisor, thank you for helping me break down, looking forward to two days of interviews. I'm Stu Miniman. We're going to have wall-to-wall coverage here from the New Orleans Convention Center, Nutanix.NEXT 2018. I'm Stu Miniman and thanks for watching theCUBE.