 From Austin, Texas, extracting the signal from the noise. It's theCUBE, covering Dell World 2015. Brought to you by Dell. Now your hosts, John Furrier and Dave Vellante. Okay, welcome back everyone. We are here live at Dell World. This is theCUBE. I'm John Furrier with Dave Vellante. This is our flagship program. We go out to the events, they start the sizzle noise. Our next guest is Chairman Sherry, the CTO of Dell EMC, federal now. Dell EMC, but mainly Dell, welcome to theCUBE. Thank you very much, John. I got to get used to this. Dell EMC and, you know, we got the hashtag trending certainly in our community, but welcome to theCUBE. Thank you. Austin, the federal is used to buying things kind of steady, getting all these flyers. Certainly the acquisition will have a big part of that change in your job. But it's an interesting engineering exercise. You now have to cobble it all together and actually provide solutions. But there's not much of a change for you. I mean, the whole acquisition just gives you more canvas to paint from. Just talk about the quick impact of the acquisition in context to the keynote that Michael just delivered, which was all about building out. Absolutely. It's a brilliant platform for our customers. I think they gain a lot of leveraged advantage of the combined companies. When you look at the difficulty of government acquisition today, and then for the government to have to integrate these capabilities on site themselves, bringing these two powerhouse companies together really has streamlined that process. And what we really measure our success in is time to mission value. You know, we have the best customers on the planet being able to serve governments around the world and bringing time to value and that time to mission value is just hypercritical in this environment. And the government relationship you guys have, it's pretty extensive. Share some quick figures and then talk about what you see as the criteria for the agencies. Because each one has their own little requirements. Ossie Secure is a big part of it. How big is your business now? I mean, technology-wise, any scope of the offering you have now and where is it going to change radically? Specific numbers for me are kind of challenging. We are pervasive and every government customer that you could possibly imagine around the planet. What I would say to you from the end user compute workstations to laptops, desktops, deploy capabilities, and the data center footprint in the infrastructure is just incredible. I think for us, the landscape's gotten much larger in that arena, but also has provided us an opportunity for our customers to really transform their data centers with all these new initiatives, right? The FDCECI initiative, FITARA now coming into play, which is a great advantage for us. We are fully supportive of where the government's headed with this because it's allowing them to shift a mindset that was built back in the era of World War II, which is now we can shift from buying things to buying outcomes, which really helps transform each. So FITARA is the federal IT acquisitions that are being formed. Talk about that. What is that? What does it mean? FITARA really is the next generation of where we're headed with the Klinger Cohen updates, which is now empowering a lot of the federal CIOs to really take advantage of the transformational efforts that are occurring with technology. As we all know, the government has a path to the technology, but it's the business model and the acquisition strategy that now gives them a newer platform to be able to get into the budgeting discussions and really shift their optics into a strategic format rather than a tactical and operational format. So they get this great healthy blend of both. So is this kind of like a little bit of agile meets management kind of strategic technology? In a way. In a way. Agility, if you will. And it's stimulating a lot of new innovation in the way that we run IT as a business in the federal government. Like what? What do you mean? So transforming the way we do IT processes, we start leveraging things like IT service management principles from idle. You get to be able to leverage those advantages. You get to shift what you're buying from specific products and services to actually outcomes that support emission. So now you can rank and rate us as a global company on availability and scalability rather than just delivering the piece parts of a solution. I want to get your thoughts on this because in the news this past year, Amazon won the CIA against IBM, big court battle, Amazon won. You get the judge actually saying, hey, this is a more superior solution, which is kind of like everyone took note of that. The federal's on the sales side's got some salesmanship things that have been in motion. But from a technology, everyone took notice and said, hey, a cloud player like Amazon would not enterprise ready at the time, so to speak, won a big cloud deal. What has that done for your view into the agencies because does that make cloud more viable as it changed the game? And how does Dell respond to that potential new trend in Amazon winning the cloud business? It's a great question. It's actually helped us bolster the business, which is a little antithetical to what most people think. It did validate cloud as a strategy and cloud as a business model and technology platform. For us though, I firmly believe, which is why I voted my feet and came to Dell, our value proposition is much greater. So when you look at the business model and the service delivery model of what Amazon employs today, it really works on the premise of you have to come to them on site. Dell's cloud strategy not only allows us to deal with the onsite requirements, but as in most things that are mission driven, you have missions that are expeditionary in nature and require you to have to take a cloud capability in a global context. And when you're talking about war fighting or the DOD markets or intelligence community markets, sometimes that involves disadvantaged users that have no comms access. So a cloud in that context is very limited with Dell's power, Dell's capability and our portfolio of offerings now, we can take the cloud anywhere around the globe. And with Atari, you don't have options on being more choosing, if you will, for available technologies, which means code word for, you can mix and match faster rather than going through some long, long ass procurement process or validation. Absolutely, the way I would couch that is being customer centric as we are as a company, it allows our customers choice. It allows customers options where they can take a cloud model into a very non-traditional type of IT environment. So I just want to make sure I understand that the point you're making is that from a global footprint standpoint, you have an advantage with your network, your partner network, your ability to deploy cloud services anywhere, anytime, versus somebody who's, you know, public cloud, they've got to have a point of presence there. Is that what you're saying? That's exactly right. So when you look at cloud at a macro level from a strategy perspective, Amazon's done a brilliant job talking about the messaging with regards to public cloud computing. For Dell, we're in all the other three quadrants when you talk about private cloud computing, hybrid and community clouds, which is where the cloud is going. I really think public cloud has reached a precipice where its value proposition is becoming more limited. As we've heard today from Michael Speak, businesses are implementing hybrid strategies around the world. And some of these strategies require clouds in areas where you can't gain access to a public cloud. So a couple of tentpole macro trends in the last decade, we're talking about cloud. And the other is, because we saw Vivek Kundra came in and there was a lot of noise, and I don't know if there's been a backlash of, not backlash, but hey, wow, we can do that on-prem and simulate some of those benefits. But that cloud mentality clearly has permeated the federal government, whether it's on-prem or public. And then the second is data. Since 9-11, the US government has become one of the most sophisticated users of data and exploiting value from data. I wonder if you could talk about that trend and how Dell has responded. Absolutely. In the heritage product lines that we have, we've always focused on data management, information management. When you start to subscribe to the principles of unlocking value, which is really the information hidden in the data, when you look at the suite of offerings we have in the analytics space, it's more than just collecting and storing. It's about how you unlock the business or mission value of what's in that data. So a lot of the portfolio like Statistica and a lot of the analytical capabilities that we provide are not only dealing with the heritage data problem but the emerging big data problem that's occurring in government. The big data problem is exacerbated by not only constituents, but also government employees now getting into a mobile context with the way they work. So now the data explosion is exponentially worse than what we're seeing prior. So I wonder if you could talk about end to end in the context of the EMC acquisition, which I know is going to be about nine, 12 months before it closes, but thinking ahead, how does that give you competitive advantage in federal, just in terms of the way the federal government consumes? Are you going to be able to craft wire RFPs in a way that other people won't be able to respond to? How will that all shake out? The fair it opens always the best way, as you know, as a practice in the United States government business and the government business around the globe. For us though, in the end to end solution story, it really does provide us all the way from the end user back into the data center in a more robust way the way their missions work. The role of the federal government's only getting more complex as we move forward is a world and as a nation and as a country. So the end to end capability being able to manage information, secure information, but also give that access to users all the way from the user endpoint through the networking layer into the data center and the way we then manage and secure this at the data center and the data management layer is vital for all these missions. So I think bringing the two portfolios together is absolutely the best value for the customer. There's the guy, and it's probably the answer is both, but does the government buyer value more best of breed or convenience? That's an ongoing argument in the commercial world and the pendulum is tilted. It's clearly this idea of having a zillion companies each with the best of breed and then you are the integrator is shifting. People don't want to be the integrator anymore, but what about the federal government's mindset? Best of breed versus sort of convenience of one throat to choke and greater integration. It's mixed depending on what your role is within the government. It's a great point you're making here is you still have to offer fair and open competition into the end of the government to make things fair and balanced for the taxpayers. For us though, when you talk about this, when you're in the mission side of the government and mission space, the optics you're going to look at the problem are very different and it's all about time and mission value. So if you can go to a single provider that offers a broad portfolio of capability and solutions that I can bring in to enhance what I'm doing from a mission perspective, there's tremendous value there. If you talk to acquisition leadership, acquisition leadership likes fair and open. They like best value. They like competition for all the reasons and value to provide to the government to make sure from a business case they're getting the best deal. So it really depends on what role you play within the government and what optic you choose. Cameron, I want to get your take on the hype term and also mega trend that's happening. I'll see it was headlining the keynote, internet of things and its impact to federal. Obviously the government's involved in a lot of, obviously from surveillance, intelligence communities to a lot of just- They got a lot of things. They got a lot of physical infrastructure. The government runs a lot of stuff. Absolutely. So from public transportation, education, I mean, it's out of this mind, it's mind blowing actually. What's your take on the internet of things aspect of the government and what they need to do to change and what technologies will they be looking at and for their build out plan? Sure. This to me is one of the more exciting trends since the foundation of the internet. Because we're not getting visibility and realizing the dreams we had yesterday today. So now everything is going to be connected. The real trick with the internet of things is what value we're going to drive out of the information that's being collected. From a government or federal perspective, this allows us to really attenuate constituent services and this will sound a little crazy but actually for the government to save money in the process. Because now they can focus the agency missions, the execution of those missions into where services are being consumed the most by constituents. You could take the intelligence community just to be able to preserve and prevent the loss of life when you're in these types of situations that's paramount for everybody. So I think that point is right on. I mean, I think the internet of things is a massive opportunity for efficiency. And new devices, don't forget the supply chain in fact. For Dell, I mean, Amazon builds their own service for their cloud. I mean, Dell could make their own both set. So I mean, I'm just speculating, but I just. So the reason I'm getting excited about when I hear somebody say that, like Cameron just mentioned, is that the internet of things, there's a premise out there that says it's, you know, we'll have to talk about disruption. You know, this disruption, this wave is going to kill that wave. And you know, we're seeing all kinds of waves. Joe Tucci used to talk about waves and waves got a little too gnarly. He said you're not out for the next wave, you're dribbling. He'll crash your bow, you're not careful. Okay, but so the internet of things, is it disruptive or is it the existing infrastructure out there is going to take advantage of it? In other words, you know, it's not Uber, you know, killing the taxi companies. It's driving value on existing infrastructure from existing organizations. How do you see the IoT from the Fed perspective? That's the point is spot on. For the federal government, I mean, do you think about where we have sensors in the world today? We can do things like manage roads and infrastructure, physical infrastructure better if we know how to deal with wear and tear and proactive maintenance. We can look at public safety with the sensors, with cameras and other things that are in cities today. So that first responders can respond better and respond more quickly to incidents where there could potentially, unfortunately, they may have a loss of life. There are so many use cases. This is really not only us just connecting the planet, but now understanding how we participate in the ecosystem. So the incumbent here, John, has a huge opportunity. It's the innovator's opportunity versus the innovator's. Well, it's not a rip and replace a lot of Uber to use that term. It's not a really, the Uber's disrupting an existing industry that's been waiting to be disrupted that had, you know, obviously certain legacy incumbents. What they're talking about here is actually building on top of pre-existing stuff, changing the world and just extending technology. So the guy who owns a parking meter has an advantage, though, is the point there, right? But I know they're getting the cut here. I won't get to one last question. But the question I want to ask you, Cameron, is you bring up things like safety first responders. There is a Maslow's hierarchy of needs, if you will, from a low-hanging fruit standpoint. Can you just kind of give us the teared approach of some of the things that you see? Obviously, the Internet of Things is, oh yeah, my refrigerator will be programmed to turn on the ice bucket when it needs, I mean, that's low-hanging, you know, not a critical infrastructure. Right. So you first responders, safety, tear out the things that you see, that you see would be opportunities that would sequence out. So if we look at the context of Maslow's needs, right? Food, water, basic safety, basic needs for humans. Leveraging the Internet of Things type of strategy, we can now do things like predict food spoilage, right, working all the way back as far as farmers and crops. We can look at planning cycles, we can look at soil content, we can look at all these different things that have a long stream, downstream impact on food safety, water safety, and all these things that we need as just citizenry to be able to survive as human beings. So the Internet of Things, it's not only where we place sensors, it's what we do with the data, how we really capitalize on that information to really streamline the entire ecosystem. You know, something that's fascinating is the United States wastes almost four billion pounds of food. Imagine using the Internet of Things to be able to either prevent that waste or ship that food worldwide as a new opportunity. And people are things too. People are things too. I mean, thing one, thing two, I read that to my kids. But the thing is that connected devices are humans and machines. That is a really big opportunity from voting to food spoilage. Absolutely. Karen, we went over a little bit, it was worth it because the Internet of Things, we could go in a whole segment just on that. Thanks for coming on theCUBE. Thanks for sharing your insight and the data, if you will, here inside theCUBE. We are one big ingestion of big data, sharing that with you. We love coming to the events and instructing the civil nerves. I'm John Furrier with Dave Vellante. We'll be right back after this short break.