 From Chicago, it's theCUBE. Covering Veritas Vision Solution Day 2018. Brought to you by Veritas. Hello everyone, welcome to Chicago. We're here covering the Veritas Solution Day. Veritas last year had the Veritas Vision Conference and they brought together all their customers. This year they decided to go around the world. I think they have six or seven of these across the globe. And we just, we're in New York a few weeks ago at Tavern on the Green. We're here at the Palmer House in Chicago, iconic hotel. About 60 to 70 customers here. Of course Chicago is a big opportunity for companies like Veritas because there's such a good customer base here. But what I want to do now is going to set up what's going on in the data protection business. According to a number of sources, Gartner, IDC data, other survey data, certainly anecdotally when we talk to customers about half of the customers that we talk to are going to replace their data protection platform within the next five years. Why is that? Well there are a number of factors that are affecting that and I want to talk about the reasons why, the implications to the market and what that means for customers. So if you look back 10 years ago there was a similar dynamic going on catalyzed by the ascendancy of virtualization. What was happening is that you had all these servers that were underutilized and so the brilliance of virtualization was we're going to consolidate those servers, virtualize the compute power, dramatically increase the utilization and reduce the physical capacity that's on the floor so you can get rid of stuff, get rid of servers, spend less and get more value out of that asset because you had all these underutilized hardware assets. Data protection backup in particular was the one workload that actually could use all that compute power, why? Because at the end of the day you're backing up this huge stream of data. And so as a result when you had to do a full backup you didn't have the physical resources so people had to rethink how they architected backup because of virtualization. So you now have a similar dynamic but for different reasons. Some of the big trends that are going on here the first one is of course digital. So digital means data and it's all about how you get value out of your data because data is increasingly an important asset. People are realizing that protecting that data is more and more important. As a result people are rethinking just the definition of recovery. Recovery has to be faster, you've got to be always on in this digital world. So digital transformation is critical. You can't just bolt on backup as you have for the last 20, 30, 40 years really. Backup has been a bolt on. You've also got cloud. Everybody wants cloud like. So you're seeing a shift from improving or dealing with resource utilization and allocation as I explained in the virtualization world now to automation. Why automation? Because people want a cloud like experience. They realize they can't just shove all their data into the public cloud. There's data all over the place and I'll talk about that in a moment in terms of distributed data. But specifically people want a cloud like experience. What does that mean? That means they want pay as you go. They want simple deployment. They want fast seamless recovery and they want a lot of automation. Well the price of technology comes down year after year. The price of people doesn't and you can't just keep throwing people at the infrastructure problem because it's so complex. You have to automate and you want to shift resources toward higher value activities, digital transformation, DevOps, application development. So this distributed data world, this multi-cloud world and I'll talk a little bit more about that in a moment when I discuss the edge. It's becoming a forcing function. Multi-cloud is a forcing function to rethink your backup because you've got different infrastructure as a service providers. You've got SaaS providers. You've got all kinds of clouds that are popping up all over the lines of business and within your own data centers. As a result, you need to think about how do I catalog all that data? How do I protect that data? How do I govern that data? How do I deal with things like GDPR and make sure that I'm in compliance? So it becomes a much more complicated set of complicated equation and the variables are distinct. For example, I don't really understand what point in time means anymore. If you have distributed data, what does it mean to have a point in time copy? Point in what time? Who's the master? So you need some kind of controls in that multi-cloud world. That's a forcing function to rethink your backup. The other thing is platform. Platform beats products. And I'll talk about that in a moment. People for years have looked at backup as purely insurance. Everybody hates buying insurance. We all know that. So you're seeing people trying to get more out of their backup and recovery platforms. For instance, integrating disaster recovery. So that's becoming an integral part of people's strategies. You're also seeing analytics becoming more and more important. People are trying to, because all the data sits in the corpus of the backup, people are saying, well, why don't we analyze that data and get more out of it? Why don't we take snapshots of that data and make it available to DevOps? And what about ransomware? Which again, I'll talk about in a moment. Could I maybe look at anomalies in that data to determine if there are some problems? Many, many use cases emerging. Data classification, governance. I mentioned GDPR before. So you're seeing backup shift from pure insurance to a higher value business opportunity. And then of course, there's security, there's compliance, there's governance. Ransomware is critical. Organizations are creating air gaps, meaning disconnecting from the internet so that if they get hit with a ransomware attack, they can isolate their data. But just even that is not enough. People can get through air gaps by physically putting in whatever, sticks or malware, et cetera. So you still have to be able to use analytics to look at that corpus of backup data and identify anomalies. But again, because of those security risks and because of the importance of digital transformation and data, people are rethinking how they do data protection. And finally, there's the edge. We are living in a distributed world. It's a multi-cloud world. As I said before, it's a forcing function. And the edge is one of those clouds, if you will, which changes the way in which you think about backup. How does it change? Locality of the recovery data. If you've got edge data, if you've got multi-cloud, you've, as I said before, got to have a global catalog and recover that data locally. Another thing to think about is SLAs. In a cloud world, you, the customer, are responsible for the recovery. Well, the cloud vendor can get the light back on the disk system or the computer, the compute system. You are responsible for the people and the process to recover your business. That is not the cloud vendor's responsibility. So you need to think about that. So, and think about recovery as recovery at the business level, not just recovery of the data, but recovery, getting your business back online. There's also the three laws of the cloud. We learned this from Pat Gelsinger this August at VMworld, the laws of physics, the laws of economics, and the law of the land. Those will dictate where you put data and how you back up that data. So all of this has created a new landscape in the data protection business. Let's run down that landscape. Who are the leaders? You got Dell EMC, you got Veritas, you got Commvault, and you got IBM. Those guys comprise probably two thirds or more of the marketplace. And you have startups like Cohesity and Rubrik who have raised hundreds of millions of dollars going after them and challenging them. You've got a whole new set of players that are taking new approaches. Actifio, for example, got the whole copy data management thing going. Datrium is creating end-to-end, both primary storage and data protection back up in the same platform with a software-based cloud-like, SaaS-like offering. You got companies like Zerto and Imanus Data that are specialist. You got companies like Wendisco, again, taking new approaches. And then you have Oracle with Oracle Recovery Appliance, which is totally changing the way in which backup works for Oracle databases exclusively, taking a database-led approach to backup. And then, of course, you've got the storage players that are part of the ecosystem, even though they're not directly competing with backup software vendors. Guys like Pure, NetApp, Infinitap, they're partnering with backup vendors. And then, of course, there's the cloud guys, AWS, Azure, Google. The thing to think about as customers is three things. Platform versus product. What's the platform look like? Is it an API-based platform? Because you want to program to that platform, infrastructure as code, you want to support your DevOps infrastructure. The second is cloud-like pricing and cloud-like deployment. You want a cloud-based operating model to simplify your operations and lower your IT labor cost and shift those costs to more strategic efforts and initiatives, such as digital transformation and application development. And the third is ecosystem alignment. Make sure that your backup software vendor and your backup solution vendors, their ecosystem, is aligned with your ecosystem because you're going to get more facile integration and problem-solving and flexibility if those systems align. So take a look at that as well. A couple of things I want to mention and emphasize. New application development models, cloud-native, Kubernetes, function, people call it serverless, but function-based programming, really to support DevOps and infrastructure as a code, that is going to have implications on how you protect data. And finally, AI. How can you talk about anything today without talking about AI? Anticipatory staging of data for recovery. As an example, predicting where problems are going to occur, machine intelligence will increasingly play a role in this whole landscape. So you can see there's a lot going on. This is why data protection is such a hot space. It's why the VCs are getting in. It's why the incumbents like Veritas, Dell EMC, IBM Commvault, those that I mentioned, are trying to re-platform and hang on to their large install bases and ultimately grow them. And it's why companies in the startup and the niche spaces are tucking in and identifying new opportunities to participate. So that's a quick overview of what's going on here at the Veritas Vision Solution Day from Chicago. We'll be here all day talking to customers, talking to the practitioners, technologists and executives. So keep it right there. You're watching theCUBE. I'm Dave Vellante. We'll be right back.