 This is Dave Vellante, I'm with Wikibon.org and I'm with my colleague Stu Miniman, who's also with Wikibon. This is SiliconANGLE.tv's continuous coverage, live coverage of VMworld 2012. This is our third year here. We're in the hang space, come by and see us. Very relaxed atmosphere, play some foosball, play some shuffleboard, and we got a great segment here. We're here with Praveen Akiraju, who's the new CEO of VCE, the virtual computing environment company. Welcome to theCUBE. Thank you, glad to be here. Great to see you, this is kind of a coming out party for you, isn't it? Yeah, it's absolutely wonderful, great technology, great people, customers, partners, having a ball. So we spent obviously a lot of time at Cisco, which at one point was the C in VCE. You guys evolved the name for a variety of reasons, but so tell us, what do you bring to VCE? Yeah, I think this, it's obviously an amazing space, as you saw today over the last couple of days, actually. Data center is going through a phenomenal transformation, new technologies, new ways of deploying, and new business models. And I think, from my perspective, my career has been at Cisco in the networking space, but while at Cisco I'd spent a lot of time in the service provider space, my last job actually was in the BYOD space, around the mobility business. And we used to define a lot of the architectures that connected into the cloud. So a lot of the access infrastructure that you saw actually Steve had to talk about the ISRG2 and VMware view, that was actually my product. That was the work that I did with him before we came here. So from my perspective, I think I really understand how customers, users, and our enterprises actually deploy and roll out the access infrastructure that's key to actually engaging and connecting with the cloud. So bringing that perspective I think would be key to essentially evolving our strategy around how we take the data center infrastructure and differentiate VCE. And so when you think about, well, how did we get here? So you guys announced VBlock, and at the time it was a relatively new concept, although a lot of people have said it, and I generally have said it as well, that converse infrastructure is largely evolutionary. It's not hugely disruptive or radically disruptive, but at the same time what Cisco brought was different. Got into a new market, so we're going to take it from a different angle. So what's your point of view on that? Is converse infrastructure evolutionary or is it revolutionary? Yeah, I think you could, from a pure system perspective, obviously, we're pulling together best in class components from Cisco, EMC, and VMware, and delivering that to our customers. But if you really think about how data centers have been deployed and the customer experience around the cost, the bring up time, what VCE is doing is truly revolutionary. We're able to cut the time to deployment, time to uptime, basically, for data center infrastructure by five times, cut costs by about three times. And this has been proven out of 500 customers that we've deployed the VBlocks with. The key here really is, as we talked about earlier, data center is in a period of intense evolution. And what we've done at VCE is to establish, converge infrastructure as the basic building block of the next generation data center. Now there's a lot of opportunity for us to build off of that to deliver new innovative capabilities, whether it's deploying solutions, whether it's enabling different management stacks and customer choice on top of this infrastructure. I think that's what we really well poised to do. So I want to just continue this line of thinking, help people understand why you, why now. So I mean, obviously my compelence has been in the queue before, a very senior exec, big business, huge TAM, we want to find a $400 million TAM. Obviously VCE and E are spending a lot of money to go after that, it's well publicized, the investments that you're making here, you're an executive with a lot of operational experience. It's very clear, you look at your resume, this guy knows how to run a business. Knows P&L management, knows how to run operations, why you, why now? I think we are ready to basically take the next step as VCE, and this is just in line with basically how the data center technology and architecture is evolving. As I said, the VCE was a pioneer in establishing convergent infrastructure as a building block for the data center, and the team's done an amazing job of delivering a phenomenal customer experience, tremendous customer loyalty and value to our customers. As we look forward, you saw a lot of innovations rolled out here today, this week, software defined data centers, management orchestration, stacks, new kind of applications. We believe that VCE is at a point where it's ready to take the next step as evolution to be able to deliver innovative capabilities that abstract the convergent infrastructure. We've proven out that convergent infrastructure is deliverable, and we have a lot of other players in the market now, so we want to take the learnings that we have from the experience over the past couple of years, and put that back into our engineering so we can develop software capabilities, service capabilities that are innovative on top of the convergent infrastructure as a platform. So my background in basically scaling up businesses will basically help us drive, take the strategy that the team's been already driving and essentially operationalize that so we can take the company past a billion dollars, which is a run rate we're approaching. Yeah, and so, but profitability thus far has not been the primary objective, it's been growth. Now you're a billion dollar company, you're headed toward a billion dollar company, does that change, especially with someone like you in charge, is that really a primary motivation now? I think the fundamental financial value proposition of VCE back to our investor companies has been the growth that we deliver in their respective segments. So if you look at, for example, at the UCS business, for Cisco, we're able to get them into accounts and a data center level that probably would have been harder for them to just penetrate as a pure UCS business. Because now we enable a different level of conversation of the entire data center, a lot of the V architects are sales teams as well as our professional services are able to have a completely different discussion than what a individual component discussion would be. So the key here financially is to deliver those growth, continue to drive growth for EMC, Cisco, as well as VMware in terms of those respective areas, but more importantly, deliver innovation. And I think that's the key for us to, in terms of expectations for VCE going forward. So I can infer from that statement, though, from a shareholder perspective, you're already delivering value in the form of- Absolutely. Not only revenue, but there's profits that are trickling down into the individual companies that they presumably wouldn't have had otherwise. That's the front of the story. Absolutely, I think we've accomplished three things for our investor companies. One is we've delivered tremendous growth in new markets for companies like Cisco, as well as VMware in terms of some of the larger contracts and ELAs we're able to leverage for them. Secondly, we are meeting all our financial goals and objectives as defined by our investors for us as a company. As you know, we're a private company, so we don't quite publish our financial results, but we absolutely have a very rigorous way of auditing and making sure we have well-defined financial goals that we are delivering. So the goal for us here is to continue to accelerate the growth and drive the disruption. We're in a hyper growth phase as a company at VCE, and I think you can see that from the evolution of our product offers as well as the way that capabilities in the teams have been built up in our customer base. So with the acquisition of NYSERA, there's been a lot of speculation that EMC and Cisco are pulling back from the relationship. Is our EMC and Cisco pulling back from the relationship? Yeah, I think that's an interesting question because when you look at a lot of the things that has been put out there, it's a fair question to say, hey, what does this mean for the broader VCE future? And I can tell you that if you take it from a customer perspective, what VCE delivers in terms of putting together these best in class products and delivering a convergent infrastructure, both Cisco, VCE and EMC are completely committed to VCE as the only path for delivering convergent infrastructure. Now, there are obviously different plays at the lower end of the spectrum that both Cisco and EMC deliver, but we typically find ourselves not competing with the lower end plays, with the more reference architecture type plays because our customers are the Fortune 500 type customers where we're going in there, we're transforming the data center, we're fundamentally accelerating the infrastructure plays. So the other aspect of NYSERA, if you actually saw the press release that came out yesterday from Cisco and VMware, they have committed to joint engineering development and actually called out VCE as a key route to market for the technology that Cisco and VMware would develop jointly in the software defined data center space. So, you know, obviously I think when you look at the technology industry for those of us who've been in this space for a while, they're always going to be areas where the investor companies will have some areas of common investment and common products where they are potentially in the same space. But I think if you look at convergent infrastructure, VCE is the only route to market and all our investor companies are committed to continue to deliver the technologies that they acquire into VCE to deliver to our customers. So, Praveen, I'm wondering if we can dig in a little deeper to kind of that vision of the software defined data center. So when VCE first launched, everybody looked at, okay, we have a V block, it's a convergent infrastructure, but at its core what VCE really looked to do is transform the way IT is consumed. So whether that be to the service providers that you sell to or to the end users is a great kind of as a service platform. If we see the vision that VMware is laying out of the software defined data center and what NICERA is talking about, where does VCE, which still at its core, it's not only hardware, but you have a hardware when I think of a software defined data center. As I said, one of the litmus test is, do I have to run it on this hardware or is it abstracted? So where does a company like VCE fit in a software defined world? I think at the end of the day, when you look at infrastructure, that's one component of what the value that we truly deliver. The actual real value is our ability to abstract that convergent infrastructure so you can enable customers to have the choice of getting applications or management and orchestration stacks or their own customized applications like Hadoop and Big Data to run on this convergent infrastructure in a simplistic manner. So our direction absolutely is to continue to develop software capability that will abstract the convergent infrastructure and be able to offer a much more efficient and faster way for enabling management orchestration and choice for customers. This is kind of what Elasticity, right? This is kind of what the foundation of the software defined data center is. So that is an area where we're driving significant investment. Okay, so one of the things we love to dip in under the cube in our audience likes is what's the competition look like? So I remember if I could look a year ago, I heard the VCE folks saying, it's Oracle, it's HP, it's IBM. I'm curious, there's been a new wave of converged vendors that are coming out. Flash is coming out. I heard some announcements this week about VCE, like the flash card from EMC. So what's the state of the competition? Who are you battling against and what's a little bit of that makeup? Here's the interesting data point. As you guys know, this is sort of my fourth week at VCE. So I've been spending a lot of time on the road with our customers, with our partners as well as with the teams at VCE, understanding essentially our core competencies, our business, and one thing that truly struck me was the claim that our teams made and justified by the customers and partners that every time we go into a proof of concept, VCE always wins, right? In fact, we've had instances where we had a customer basically come in and say, drop off your re-block and walk away, right? We will do our own tests. And we were able to complete the entire proof of concept before our competition was able to actually configure and get their platforms up and running, right? So I feel we have a significant competitive advantage, competitive advantage both in terms of the building blocks that we have are best in class, the storage, networking, or virtualization. And secondly, I think, I call them scars on the back and again, having been in the industry for a while, it takes a lot to actually put together a converged infrastructure play, right? And operational folks in the IT departments would know what I'm talking about. You fundamentally learn a lot by actually putting these systems together, getting them deployed, and delivering on the promise of getting the system up and running within 30 to 40 days for our customers. So that, I think, is a huge advantage for us which allows us to then take that forward from an innovation perspective in terms of simplifying and abstracting the converged infrastructure. A lot of our competitors have recognized the converged infrastructure space. We welcome them to the market. I think they're going to have credible offers, obviously. There's a spectrum of converged infrastructure offers. We obviously are targeting the Fortune 500, right? And we will be coming up with offers for the rest of the spectrum of the market as well. So last question I have for you, if you're focused on the Fortune 500, how does that fit with your channel? So there was a little bit of a rough ride, the first kind of 12 to 18 months with VCE. So where are you with the channel? Who are you seeing your deals from a partner channel's perspective? Yeah, I think we have close to 150 partners who are certified on the V-Block. Partners is a very important part of our strategy and we look at it in a couple of different ways. One is obviously, from a relationship perspective, we work very closely with a lot of our partners as we go to market and deliver our V-Blocks to large customers, Fortune 100 customers, but we're also enabling partners to be able to configure and drive V-Block sales themselves. And I think that's the most exciting part for us. So we're seeing some good traction, particularly in some of the regional parts of the United States and the West and the Midwest where we're seeing pretty good traction from partners. Our longer-term strategy for partners obviously is to ensure that we're able to deliver to them profitability at the same time, deliver to them a product set that they're excited about, that they can go and drive to their customers and explore new markets for us as well. Competitively, you were talking before, it used to be just V-Block was it. And then HP would argue, simultaneously came into the market, you guys would say you were first, we would agree that you were first, but for a while it was HP and DCE, really, it was a two-horse race. And now everybody's in it. IBM has thrown down the gauntlet and brought its expert integrated systems in and the differentiation is this application knowledge. So now my question to you, Praveen, is how do you continue that leadership? Do you bring in sort of similar knowledge? Can you leapfrog that? What's the next vision on the roadmap? Well, I think we have to build on what our core strength is, which is delivering an amazing customer experience. I was at dinner yesterday with one of our customers from SoftBank with whom we just announced a global partnership to deliver the V-Block systems as part of their cloud services strategy. And what he told me was he had close to $7 million invested in a traditional sort of build-it-yourself data center architecture. And it took him almost six months to stand it up. And so this is the COO of SoftBank. And he said, the first V-Block, we were able to get it up and running in 40 days and it just blew his mind, right? And that was really why he was willing to sign, take the leap of faith and sign this huge partnership with us. So really I think that customer experience is what we build our foundation on. Now, as I said, the scars on the back aspect is important because what we do is we actually bring in technology experts, whether they're storage experts or network experts or compute guys, and train them for six months so they're actually able to go into a customer and have a full data center conversation all the way up to the applications. We're absolutely comfortable with the talent that we have on the sales side, on the services side, to deliver that remarkable experience. And I think we've built it from the ground up with the experience of having deployed 500 customers. And I think that's, again, as I said, a key competitive advantage for us. Now, to my correct, most of that activity has been, or much of that activity has been in the US, you guys announced this morning a deal with SoftBank. And first of all, is that the first statement correct that most of the activity and focus has been in the US and is this mark a new sort of chapter? Well, we've been very, we have some pretty key customers in Europe as well. We are sort of starting to penetrate into the Asia-Pak market. SoftBank is one of the most significant deals that we've announced, but as part of some of our customers who are large multinationals, we've had footprint in Asia for a while, but this is clearly one of the most significant announcements for us in APAC. Great, all right, Provinable, thanks very much for coming to theCUBE. Congratulations on your new role. Thank you. We'll be watching and good luck. Thank you. Thank you for the great show. All right, keep it right there, everybody. We'll be right back. Jay Sri Ullal is coming on from a CEO of Arista, and we're live here at SiliconANGLE.tv. We're at VMworld. Keep it right here. We're right back.