 Hello everyone, I'm John Furrier the founder of Silicon Angle. This is the Cube Conversations here in Palo Alto and my guest here is Hamadou Dia. Welcome to the Cube. Thank you. Your group vice-president of Enterprise Architecture Hardware at Oracle. Yes. Great news today about growth and hardware. It's fantastic. Big news. Yeah. Tell us about it. Yeah, we grew hardware for the first time. We announced our result yesterday. We grew hardware year-over-year by 10 percent, which is a phenomenal growth. I think our strategy is paying off. Strategy, you know, focused on building, taking hardware and software and engineering them to work together is resonating very well with customers. Four years ago, Dave Vellante and I were part of the Cube to Oracle Open World and we were noticing kind of the vibe. It was kind of like a lull before the storm kind of, you know, I want to say old Oracle and now the new modern Oracle, but you had, you know, MySQL, you had the software investment, you had Oracle technology. Right. But that was just right when Larry kind of launched the whole cloud movement, which then became big data. In the next few years, just the energy has been phenomenal. You're seeing the ecosystem is energized to new solution sets and this is the inflection point we're living in. So share with the folks your view of the market. From four years ago today, what has changed? What's happening in the market? Obviously, hardware with the growth is showing this purpose-built and integrated systems is a winner. Right. Now, see, Sun has DNA of excellence, but what's happening now? What's happening is something we've never seen before, I would say. We're seeing massive disruptions in the marketplace and because of just number one, the Internet of Things. Today, in 2012, they were nine billion devices, Internet devices. There will be 50 billion devices by 2020. We're seeing information explosion. The amount of information that was created since the beginning of mankind was recreated over the last two years and that information, that amount of information will grow by 50 times by 2050. In addition to that, we're seeing significant growth in mobility. Mobile is the new PC. You take all these trends compounded by the fact that we're new, compounded by really these new behaviors from consumers because of social media and because of mobility. It's really generating significant disruptions in the industry and our customers, IT infrastructures, are significantly challenged because we've never had this massive amount of information to deal with. We've never had this significant radical change in architectures before. We've never had these security challenges we have to deal with, etc. We're seeing massive disruptions that require significant changes and innovations in the way we handled IT like never before. The megatrends always are in the news. You can't go anywhere. I thought it's cloud mobile and social. No one was talking about this in 2009 or 2010. You mentioned the internet of things and mobility. This is a new data paradigm. Big data is at the heart of everything from sensors and watches at a programmable, Google glasses, devices, wearable computers. That's not going away. Fitbit reports data for health reasons. The database market must be a hot section. That's the DNA of Oracle, but it's not a standalone database anymore. You're seeing a new innovation around what databases mean. What's your vision for your customer standpoint? What's the opportunity and challenges that they have around the data? Absolutely. It's a great question. Information management, that's the DNA of Oracle. Managing information. We started as a database company. I think we know better than anybody how to manage information. But you were right. Now the type of information being collected is completely different. It used to be just relational data. Now it's a lot of unstructured data and massive amount of information. It requires different solutions at different level to handle this type of information that organizations are collecting. What's great about Oracle is that this is the most innovative company in the software and hardware. We've been planning for this, I would say, for a while. We have a comprehensive set of solutions that can help customers manage unstructured data, no SQL database, Hadoop clusters, and relational data. We have a comprehensive set of solutions to help customers manage all type of information that's required today because of those IT trends. The IT trends, data, mobility, security, these are all challenges. How are your customers responding to those challenges? And how can they respond faster? We hear agile programming, time to value. You have really now a speed issue to respond. How do your customers respond and how can they respond faster? A lot of our customers are faced with significant challenges because more than 70% of IT budget are still allocated to keeping the lights on. The type of transformation that's needed in their infrastructure requires some significant investment and innovations. And most of our customers are looking to Oracle, for example, to help them really transform their infrastructures to handle these different challenges. And the second element that's really, it's all about speed to implementations because the amount of information is massive. It requires implementations, it requires sophisticated technologies to handle security, information, mobility, etc. So they're looking to organizations like Oracle to help to bring in innovations, predefined solutions to really help accelerate their time to implementations. We're here with Hemadu Dia, who's the Group Vice President of Engineering Architecture, Enterprise Architecture and Engineering Systems here for CUBE Conversations. I want to ask you about the engineering system. What is it? What is it? I mean, people always say, oh, it's Oracle end to end, but what is at the core of engineering systems and how do customers deploy? I mean, how is the, just take us through what it is and has it been implemented? Absolutely. So engineering system, it's really, it's really about innovations and taking hardware and software, integrating them, engineering them to work together. It's really, I would say is analogy. I would say it's, it's the iPhone for enterprise computers. Customers buy one product? Is it like, there are a frank bill of materials or one product? How do they buy it? Yeah, customer buy, it's one product. So we do have these engineering systems, these are purpose built machines that are highly optimized to run our database, for example. Our exadata machines is the best platform for running Oracle databases. It's hardware, and the Oracle database and some, and Oracle and software that help manage the storage between the Oracle database and the storage servers, highly optimized Oracle secret source and lots of innovation to run the Oracle databases, like better than anybody. So like the iPhone, people can relate to the iPhone as obviously it's an iPhone, it works, it's got an app source, it's not like it's closed, but it's open, people can publish apps, but it's optimized for the user experience. So consumers get that. How is it optimized for the enterprise? From your standpoint engineering system makes sense, okay I want to buy an engineered systems, one product number, you can handle all the disk, all the flash, all the stuff inside, it's all bundled, right? Exactly. What's the user experience for the engineering system? Exactly, and that is the whole point. It's today in enterprise IT, if you want to implement, if you want to deploy an Oracle database, you go see a soft storage vendor, you buy storage, you go see a network vendor, you buy some network, you go buy, you see a hardware vendor, you buy some servers, then you have a database, a sysadmin, a network admin, a storage admin, you need to bring all those guys, all those people needs to bring all those different pieces together, and then, and before you even start deploying the software. With an engineering system, customers don't have to go through any of that. It's pre-designed, pre-built, it comes with storage, network, servers, and the Oracle software deployed and already optimized. You know, I was, I remember when I was in the 80s, when I was just graduate from computer science program, I, in the program, I had a SunBox, it was amazing, SunTool, early days of Sun, Sun had a great run, amazing mini computer, great workstations, but then when Oracle acquired Sun, everyone said, oh, it's never going to work, it's Larry's dream to have a hardware, but sales are up, 10%, you're growing the business, so the idea of, he took it as a trophy and just wanted to have it around and take all the people and bring it into the software world, that didn't happen. You have a really legitimate hardware business, the numbers speak for themselves, obviously 10% growth year on year, but you have a lot of people who run Oracle, but don't run on Oracle hardware. So what does Oracle hardware and Oracle software running Oracle on Oracle mean? You guys talk about that, running Oracle software on Oracle hardware. What does that really mean? Exactly. So, and I think if you look at, you know, our strategies always been, it's about innovating, delivering value to customers, and really we spend more than $4 billion in R&D every year. We are more, we are better suited for some tasks, we are focused on really taking, I would say low value, high cost tasks away from our customers, do it for them to help them really focus on their businesses, deploy applications, deploy business solutions quicker. And that is why we are helping most of our customers today significantly reduce cost, significantly optimize the Oracle software by helping them move those applications or databases onto the Oracle hardware. Okay, so let me just run through this, I got this right, so take me through, I'm going to walk you through the use case, you tell me if I got this right. Okay, so I'm an Oracle customer, I'm running my business on Oracle software, and I'm buying a bunch of other off the shelf stuff, I got servers here, I won't say the names of the vendors, but you know, they're all the same suspects. I got some HPs, I got some mainframes and minis all over the place, not Oracle. So huge cost of doing business, huge OPEX cost, I'm running the business. Do I throw all that away and buy the new engineered systems? How do you help me? So I say, okay, I want to do the Oracle hardware. What's the plan? Do I just throw the hardware away, move the software over? Is it a migration? Can they coexist? Great question. So a lot of these customers, they go through some refresh cycles, so most of typical hardware investment are depreciated over four years. So what we, and actually some customers don't even wait for four years to replatform just because of the significant benefits and values they get from by replatforming on Oracle. Our proposition is pretty simple. It's that those customers, they are growing. They need more capacity to support their growth or their expansion into new market. They need to run some applications faster. So we recommend, we help them just migrate the applications as it is onto Oracle hardware and to reap the benefits that comes with it. And they can do that at their refresh cycle. They can do it during the refresh cycle or before the refresh cycle. We help them, we help put together a future state architecture for those customers, a migration plan, and really help them get from point A to point B. So they can still coexist. There's no disruption to the business. You guys come in there. Is there a specific architecture that you guys propose? Is there a staging area? Is there like a halfway house? Or is it full migration? I mean, how do you guys do that? How do customers get there? What approach do they implement? What's the most common? Yeah, we have a pretty well defined process for helping customers. I lead the architecture team for North America. Our job is to really sit down with our customers, understand what they're trying to do from a business perspective. What are their key pain, point challenges? They're faced with design a new future state architecture for them and really develop a migration plan for them. And we help them migrate or we provide them with all the assets and tools that can help really migrate the applications from competitive hardware onto Oracle hardware. Do you guys see yourselves winning new business with the engineered systems that are not yet Oracle software? You come in and display some competition? Oh, absolutely. For example, we talked about our hardware growth. 30 percent of our hardware revenue now comes from engineered system. We are taking share from our competitors. And we are seeing many customers, a lot of customers are actually moving some of their Oracle workload onto Oracle infrastructure because of the benefit I've talked about. I have a customer, for example, a manufacturing customer in the U.S. Fortune 500 company that runs Oracle e-business with advanced supply chain planning, demand forecasting. That's a portfolio of Oracle applications. We're expanding into Latin America, but we're faced with significant challenges from a stability perspective, performance issues. We help that customer consolidate all those applications onto Oracle engineered system, help them significantly reduce costs, accelerate their demand forecasting by five times, and help them accelerate their supply chain planning by six times. So I've got to ask you the question. Since you lead the North America group, what's the feeling in the field, the troops? When you're in front of all your troops and you say, hey, all this disruption is going on, I mean, what's the vibe? People have a spring in their step? Or you need to hire more people? I mean, what's the guy on the ground like in Oracle? Were they super excited? People are very excited. I would say this reminds me of the dot-com era because, number one, we're seeing new technologies emerging, new companies emerging, new startup emerging. And at Oracle, we are very excited because we've been building Oracle portfolio for this time. And I tell my troops, this is our time because we have a unique portfolio to help our customers address all these challenges, whether it's internal things, big data, mobility, social, we have it all. We have a unique portfolio that can help customers tackle all these challenges. They must like it. I mean, from a go-to-market perspective, you want simple and you want to churn and burn, right? Here's a product, move on, not get stuck in the weeds, configuring and rolling out, right? You guys have this approach. Is that kind of the vibe too? Exactly. And they see it. It resonates our customers with our customers very well. Most of our customers are looking at cloud. It's all about speed. It's all about how quickly can I implement this business solution? How quickly can I enable this new business capabilities if I want to survive? So customers are not interested in really putting different pieces together, building systems, running them, maintaining them themselves. They want to focus on running their businesses. They want to focus on their competitors, gaining shares, growing the top line. That's really what they're interested in. So we are very excited about our portfolio. We think we're uniquely positioned to help our customers really face all these challenges. We're here with Hamadudia, the Group Vice President of Enterprise Architecture and Engineered Systems. He's the man who runs the North America customer interactions, rolling out the technology, architecture, making things happen for Oracle's engineered systems, Oracle on Oracle. Hamadudia, I'll give you the final worry about the final question and get the final wording for you is, what do you want to tell folks out there about Oracle? Existing customers that you haven't gotten in front of yet, or people that aren't yet customers that you want to be customers, what is the bottom line with Oracle engineered systems? So what I really want to say is that Oracle is one of the most innovative companies in the industry. And customers today, we're seeing massive disruptions in the industry because of Internet of Things, big data, mobility and social. And in order to face these challenges, in order to leverage this IT trend and stay competitive, you need highly innovative, highly scalable, highly reliable, highly secure environment. And it's really, you need a technology partner, an innovator that can help you, that can, that wakes up every day thinking about how to design and build those systems. And we're uniquely positioned to helping customers face those challenges with our engineered system, because that's what we do best, taking hardware and software, engineering them, engineering them to work together, to deliver unparalleled, unmatched performance, high reliability and security. Well, we're big fans of the software-defined era of modern infrastructure. And it's certainly, you need hardware to run that software, whether it's in the cloud or engineered systems, good call, hardware sales are up, surprising everyone on Wall Street and certainly in the industry. Hemadu, thank you for joining us. This has been a CUBE Conversation with Oracle. I'm John Furrier with SiliconANGLE in the CUBE. Thanks for watching.