 Okay, we're back here live here at HP Discover 2012 in Frankfurt, Germany. I'm John Furrier, the founder of SiliconANGLE.com. This is theCUBE, our flagship program. We go out to the events and extract the signal from the noise. Had a big day here, ending day one here at HP Discover. And really the key themes that we're finding is software-led infrastructure and big data. Those two elements that we've been covering on SiliconANGLE through our publishing group and our research team at wikibon.org is the centerpiece of HP's entire strategy. Everything that HP's touching is native software-led infrastructure and big data. That is the key report that we're finding. And my co-host, Dave Vellante, is joining me here. Dave, totally there with big data and software-led infrastructure. John, I'm thrilled to introduce Sean Kenny. Sean is a longtime CUBE alum. He's been to the wikibon offices. He runs product marketing for, sorry, HP Storage Group, used to be at EMC, which is why I love the action that's going on in the industry. Because Sean's got that DNA. He's not afraid to take off the gloves. Well, I mean, let's face it. HP brought a lot of folks into the storage group. I've said for years, Sean, before you guys joined, HP is sitting on the huge opportunity, but they're a server company that doesn't understand storage. When Donatelle came in, that changed. And he brought in people like yourself, Tom Joyce, Randy Seidel, and on and on and on. And others as well. I know some folks joined from NetApp, but storage DNA, that's what you have. And you're aggressive. You know what it takes. And you're having fun. I love it. And a lot of people put in a lot of work to get to today in engineering, starting in HP Labs, the three-part team. Today is a good day for HP because if you think about it, we change the industry. And if our customers do it right, they change their buying patterns. We simplify their life. We're going to reduce architectures, complexity in their infrastructure. You know, if you think of all the products you have, you have some in the mid-tier, some in the high-end, some out at the edge, some in the data center, all different products, different architectures, it's impossible. Now you think you have what, two or three vendors, but you multiply that and it becomes exponential in terms of the amount of products and architectures you need to manage. HP's message as of today is, hey, one primary storage architecture, one disk-based backup solution, no matter where you are, no matter where you want to perform, de-duplication for backup, and one platform for big data. Okay. Okay, so, and again, back to my earlier diatribe when Donatelli came in, a lot of people expected, okay, instant turnaround. And that didn't happen, obviously. The three-part acquisition was a key move. The store wants organic content, that's been key. So okay, so let's talk about the strategy. One platform for primary, one platform for backup and one platform for archive, right? That's right. Okay, now, so the dissonance in that is, so you've got some older legacy platforms, you're moving those to the primary. Help us understand the positioning of the new three-part. So first of all, let's talk about the new three-part, moving down market, and help us understand the positioning relative to the products from left-hand. Absolutely. The store virtual products. So we'll start with three-part. Customers for years and market research companies have segmented mid-tier architectures and enterprise architectures. Mid-tier architectures, dual controllers, you buy kind of the brains of the operation and then you rack up disk drives. Enterprise architectures, multiple processors, multiple paths in the back end, and that was a clear split. And it was performance and scalability and functionality and yes, price. And so customers always had trade-offs and compromise. What three-part store service has done today is we've basically obliterated and eliminated that boundary in that you get all the enterprise functionality, a four-controller architecture, tier one enterprise data services that are running the most advanced service providers on Earth, you're now getting that at a mid-tier price point. So those traditional market segments, they no longer exist. HP's tagline is storage without boundaries. We've now eliminated the boundary between mid-tier and high-end. Mid-tier price was at 40,000 US, down to 25,000. We're in Europe, so I guess we should be talking in Euro. What's that? 20 and 30,000 Euro respectively. So Dell wrote a blog post today saying that their customers prefer Dell Fluid over HP. How do you respond to that? Because I tried to get Davis got to go beyond EMC and tell them about the competition. So let's talk about the competition. Let's start with Dell. I haven't read it, so I'm a little bit of a disadvantage, but they said storage legacy, which could be meaning a little bit of the old stuff. Let me just add to that. Dell is a great example, I'm glad you brought that up, because Dell, in my opinion, is one of the companies that takes integration seriously. They even say our R&D team is our checkbooks. We bring that in, and then we try to integrate. So I give them high marks, and your strategy is to have commonality across the portfolio, so. I would actually say our other strategy is HP innovation, research and development, investment and engineering. I haven't looked at Dell's storage numbers recently, but I think overall, since the height of the EMC-Clareon-Dell relationship, I think even with the compelling deal, I think they're still going backwards a bit. My response to the Dell comments, again, without having read the article, this is conjecture. Well, fluid data in particular. I think they were trying to make something out of nothing, and they knew this HP announcement was coming, and tried to steal a bit of a little from there. Well, so let's talk about that. So the three-part, mid-market product, block-based storage. So. Block-and-file-based. Block-and-file-based. So who should be shaking in their boots, in your opinion? I think anybody with a traditional dual-controller architecture. Let's go down the list. Starting with HP EVA. I'm looking right at the camera. We are not end-of-life EVA, and we have no plans to do so. We will continue to invest in that platform for our customers. At the same time, I will tell you, we are strongly encouraging our EVA customers now to move to three-part, and we've made it so easy with an online import capability that it's easier to move from EVA to three-part than it is from EVA to EVA. Yeah, but can you guarantee any efficiency improvements if I move? Absolutely. That was a laugh. That was a softball question. Guarantee, whatever, if you don't make that guarantee. No, HP's got good guarantees. That guarantee. You need to find print on all that stuff, and you guys got good ones. You know, the other thing about that guarantee, so we've had it out for a year. We're the only ones that offer anything like it, and this is basically saying we guarantee you can use 50% or less storage when moving from a legacy array to three-part. You know how many claims we've actually paid out? Zero. The guarantee is a great marketing. I'm telling you guys, that's really awesome programming right there. I got to say, my question- By the way, I got to say, I just, props to NetApp too. NetApp's got some decent guarantees out there. They're not as aggressive as you guys are, and it's not as frequent, but their fine print is pretty good too. They'll stand behind what they said. And I'll give them credit. You know, NetApp has, NetApp kind of has that one-size-fits-all model as well. But where they struggle, and I think you've seen this over the past years, is they're still at a dual-controller architecture. You know, that's where they started many years ago. I think they've extended it almost as far as they can, but they can't scale into an enterprise architecture. So I think NetApp, they may be a little nervous. Well, we'll see if clustering changes. Sean, we'll see, yeah. Sean, so you run product markets. I got to ask the marketing question, which is, is it converged storage? Is it software-defined storage? Polymorphous storage? How are you guys, I mean, they got a lot of it to hang around. I mean, it's like, you know, it's like you go to Nordstrom, you see the mannequins hanging together. You get the hat, the shirt, the sweater, slacks. I mean, you got a lot of meat on the bone with storage right now, with 3-par. So 3-par is changing the game, but I mean, how do you look at the marketing challenge? I mean, you're looking at it and saying, I mean, because converged, although Donatelli's big into it, it kind of has an older meaning to it, although convergence is a relevant word, but software-defined is the hottest thing right now. Software-defined networking, software-defined servers, that's good positioning. I mean, customers get that. So what do you guys, how are you going to vet this out? What are you leaning to, and where's your head at on that? Sure, our strategy is converged storage. Now our converged storage platforms have three pieces in common. One, they're built on industry-standard servers, which in case you're wondering, HP sells trillions of without ProLiant. Yes, ProLiant, trillions is an exaggeration. I want the IR guys to get in trouble. But not just HP servers, any servers? Well, HP converged storage around HP servers. Then it's scale out, storage software, and common management. Now, if you think about that base, the foundation is industry-standard components. So it's not that far of a logical extension, say, hey, we'll get to a point that we can run software on other stuff, and we do that with left-hand, and we've been doing it actually since 2007. And so when other virtual storage appliances come out, and they talk about all the limitations, we have a fully functional storage platform that can run on anybody's server, and we've distributed 150,000 licenses. So I like to talk about pioneering, because when people pioneer, and if polymorphic becomes a pioneering term, then I'll eat my shorts and shave my head. I look forward to watching that happen. He says, polymorphic, Joe Tucci will probably say to burn my ass, because I hijacked him in the hallway a few times with the social cam. But talk about left-hand, because David Scott said that they pioneered storage virtualization. And there's not a lot of discussion around that, because left-hand kind of got weaved in and didn't get the fanfare. Could you just unpack the left-hand pioneering milestone, and what's that all about, and what does it mean today? Sure, so Store Virtual, built out of our left-hand product and left-hand acquisition, continues to be our solution for client virtualization, and it's our lead horse in this virtual storage or software-led storage, software-defined storage area. We continue to offer it to our customers, they use it in all sorts of ways. And the best thing about our customers is they deploy it away sometimes we hadn't thought of. Like, oh, did you know we use it for this? We use it out at the edge for really small environments because I have an extra server lying around. And by the way, it can be an IBM server, it can be a Dell server, it doesn't have to be ours. And then I replicate the data or I run it in a metro cluster environment across a campus. The flexibility of software-defined storage is fantastic. And on top of that, if you already have the infrastructure, whether it's extra disk or whether servers, becomes a fantastic proposition. So, obviously cloud is the new infrastructure and it's just a combination of all the enterprise stuff like non-premise, hybrid, probably all that stuff. But one of the sacred cows in, one of the key elements in cloud is virtualization as well as your area. But one of the sacred cows in this area that people talk about is the hypervisor, right? So the commoditization of the hypervisor is a big trend but people are really looking for agnostic approach to the hypervisor. So the fear is, if people treat the hypervisor as their own, you have that lock-in. So I want to move a virtual machine around. So you guys said yesterday that you're hypervisor agnostic. Is that true? And what does that mean going forward? What is the headroom? What kind of headroom does that give the customer? I would describe it as flexibility and options. A customer isn't locked into VMware today and maybe they're looking at Microsoft but that fear of, if I make a decision today, am I locked in for the next five years? A fear is gone. And maybe it's the other way around. Maybe it's Hyper-V first. But you agree, though, that this hypervisor sacred cow thing is going on and people do want to keep it to themselves that the world wants. The hypervisor vendors? Of course they do. The world wants a capability to move virtual machines without being hypervisor agnostic. Okay, I misunderstood. Yes, absolutely. You know, it's competition and competition drives down prices and the classic market economy. So what about NetApp? So on the Q and A yesterday, David Scott got the question about NetApp and he made an off-the-hand comment about they have multiple controls. I didn't really understand that. What does that mean? Sure, so going back to Dave's question about mid-tier architectures with dual controllers, that's NetApp. Okay, got it, okay. And so you started with, hey, who should be a little bit nervous about this response? I started with, you know, what's talking about our EVA customers. Obviously, Dell is sensitive to it, right? Yeah, you know, anybody in that mid-tier architecture. What about the VNX? What about the VNX? How do you think they're going to respond? I think they should be. You know those guys well, I mean. Very well. What's your response is going to be? You know, I don't know. One of the things we do, and my counterparts, all the other companies do, is we try to figure out what's the competition going to say in response, like where are potential of the holes? I don't know. I don't know. All right, now, back to my earlier question about the position, because I'm still a little unclear on the positioning between store virtual and the low-end, new three-par store serve 7,000. 1,000, yeah. Sure. We talked about a single platform, a single architecture, mid-tier to the high-end. That is three-par. And for, if you want software-defined storage, store virtual is there. If you want client virtualization, store virtual is our preferred solution. If you want a pure iSCSI solution, store virtual is our preferred solution. Obviously protocol, well that makes sense. Okay, I understand that. But it's really not one architecture for primary. You're saying it is in that it's three-par. It is. But I mean, left-hand's alive and well. It is. If you're thinking about scaling up into the enterprise, whether today or in the future, that's the three-par answer. If you're in enterprise today, we're going to tell you it's three-par. What's the channel telling you about this? Because you're moving a lot of product through the channel, and now you're offering, now of course you're selling three-par through the channel as well, but there's more of a direct sales presence there. Yeah, I would say we've had a price tag on three-par that put it out of the reach of many channel partners and many channel customers. Right. And we were involved in a huge training effort to get to today. We trust our channel partners. We gave them information ahead of time on a non-disclosure. Yeah, of course. What did they say? Thank you. You know, they're going to make a lot of money with this. Yeah, okay. So they're not concerned about the positioning. They're not sort of asking us, what are they asking you? What are they asking you to do to make their lives easier? How quickly can I get it? Give them more margins. Yeah. Give them more points. How quickly can I get it? And when can I get one in my lab so I can show my customers all great questions around demand? For many of them, this is the first time they've sold three-par. So we actually had two challenges with channel training. The first was teach them how to sell a scale-out architecture, because for many of our EVA customers, it was the traditional scale-up. They had to learn something new, and they had to learn how to sell three-par. So that sort of tool challenges. I think we did a pretty good job, but the first six months are going to tell us. So when can they get it? Today. Easy. We actually took, I can't tell you how many, we took a decent amount of orders already, getting to today. And we haven't talked much about the whole backup space. Maybe we should spend some time there if you've got it. Always. It's like being a rock. So I'll set it up, because I think that many people may or may not know, but so you've got a situation where the market leader EMC acquired Avamar years ago, and then Data Domain blockbuster acquisition, and attained at its peak about 66% of the market. Big, big chunk. Really, you guys weren't there. It was really, nobody else was there. How has that picture changed, and how are you going to unseat that dominance? Sure. They grew by acquisition. Two acquisitions. Two incompatible technologies. Two really different approaches to solve the data protection challenge. And data is scattered everywhere. It's in the data center, it's out at the edge. So they chose to have two different products, one for the data center, one for the edge. Data Domain and Avamar. We took a different approach. And when we launched StoreOnce back in June of 2010, we said, hey, this is a flexible architecture that can be deployed anywhere. The core StoreOnce algorithm, which came out of HP Labs, I don't know if Alistair was here earlier, wasn't tied to the file system, to the operating system, to RAID, to hardware, to anything. What does that mean? It means we can put it in a lot of places. When we came out with the announcement, we said, hey, we have our small and mid-sized products today. This is June of 2010. But we're going to put it in an enterprise scale-out architecture. That was November of 2011. We said, hey, we're going to put this in software with Data Protector, and we're going to be able to put it on a media server. Now that was StoreOnce Catalyst in June of 2012. Now what we're saying is, hey, now you can run it on those StoreOnce Catalysts, on those mid-tier appliances. So really, you have one architecture, one deduplication implementation, and you can perform deduplication on backup data anywhere in your environment. So it's, for a customer, it's a simple choice. Do you want two architectures or one? Because you have data in both places. And on top of that, do you want data protection strategies that match your business requirements, or do you want to have to implement data protection strategies that are driven by technology requirements and limitations of the products themselves? Our customers can now do things that previously were unachievable, whether it's backup or disaster recovery. So I, yeah, give EMC credit, 60 plus percent market share, but we continue to grow, we continue to take market share, and it's a good business for us. Yeah, I mean, I give a lot of credit. It's hard not to. I was skeptical of that acquisition at the time. They obviously proved me wrong. They kept it out of NetApp's hands. NetApp's had to take a completely different strategy now, which by the way, I like their tack. It's different. It's different. So, we'll see what that all takes on. I like their Amazon move. I mean, their Amazon thing, I thought was pretty interesting. Who NetApp? What's your take on that? I mean, that looked like a good move. I just read the headline today. I have no opinion. It's, I'm sorry. Okay, so my question is on the, you guys did a great job yesterday on the announcement. Thank you. And you had a little big data in there with your autonomy thing. I know you didn't spend a lot of time on it, but the question for you is, how do you going to bring in the big data? Because big data really has a big storage component. It's under the covers, but it's really important with SSDs around the corner. You guys are doing a lot of work. And you didn't talk about that either. Much about the solid state innovations. I'm sure that's coming. Fun, you can tell us. The store service here today. Yeah, I mean, but it wasn't really talked about yesterday. It was a big announcement. We didn't want to take away from it, but you get solid state and you got big data. Two of the hottest trends on the planet. How are you going to bring in the positioning with big data? Because we're saying it's native within HP now that big data is going to sprinkle from laser jets, storage to services everywhere. So how do you manage that? Sure, let's take the big data question first. I'll get back to SSDs. Big data, and I think I saw a number that by 2015, customers are going to spend $15 billion on big data between server, storage, software. And the lion share of that is going to be the storage. And big data has two fundamental problems. Really almost three. The first is how do you store it? Now, how do you store cost effectively? How do you have an architecture built with petabytes in mind? First problem. Second, is it file-based data or is it object? And do you have two separate products or do you do file an object in one platform? Third, now that I have it, so we solved the storage problem, what do I do with it? How do I deliver competitive advantage? How do I learn more customer insights? How do I back it up? Yeah, exactly. What should I back up, you know? And that's where the integration with autonomy comes in. So Store All, our scale-out platform, that handles the storage piece. And it has all the worm and the constant validation for data immutability, as well as policy-based tierings. That's the storage piece. The second thing is, all right, how do I do anything with it? And that's where autonomy and the integration comes in. We had, we announced something called Store All Express Query, which really allows you to scan, process, and understand data. Some of our tests showed 100,000 times faster. Now, we ran tests of a 500 million file, file system. 42 hours to one second. I mean, you guys are bringing that whole information management piece. I mean, you're integrating into one of the strategic pieces of the business, and I think that's impressive. And I want to ask you, compare and contrast that with IBM, for example. So, you know, I try to get this in and have enough time with David, but, you know, IBM Storage Group, and David and I have been talking about this publicly, they're kind of different, right? They're like the storage guys. And they're trying, they have Tivoli out here, and they've got the similar big company's phenomenon. So, how do you guys compare to IBM, both on a product, and then also how they're organized? I can't comment on how they're organized. You can, but he will you. Choose not to. But on a product, typically, you know, I don't think, you know, sometimes when I look at IBM, I see HP of a few years ago, from a storage perspective, you know, they're the UNIX guys, they're the mainframe guys. They kind of grew by acquisition on the storage side. They can't talk about polymorphic simplicity. You know, they can't talk about a single architecture for primary storage, for data protection, for information retention. So, I think they've crafted a decent, a big data story. But on the product side, compared with the storage platform, I don't know. Yeah, they're kind of like, yeah. Yeah. Okay, cool. So, let's summarize this, actually, as we can. I know we're going to break, but so we've got the big guys, you guys reemerging, you know, taking off the gloves, I say, you're very excited. You know, EMC gets more and more complex, but it continues to do well. No question, it's got the VMware thing going on. Oracle's this wild card, and we get that the whole red-stacked piece. You know, HDS, you know, see what they publicly say, they grow every quarter, but, you know, okay. So, you got these Dell is in there in the mix. You got four or five, you know, big in NetApp, big storage companies now, all sort of doing their thing, all with significant resources. And then you got these startups, you know, ScaleIO today raised a bunch of dough, and they're claiming they do software, you know, lead only. You have these flash startup guys. How do you see that all shaking out? Is it going to be, are we essentially in an oligopoly where a few guys control the chess board, they can pick off, you know, like EMC buys data domain, pick it off and neutralize, you know, that threat, you know, you guys picking up three-par, beating Dell, Dell making the move, but you guys have all pretty much, you know, stayed in a position to compete. Do you see that changing, or do you see that continuing? No, I think oligopoly's the right word. Going back to your business school economics class. You know, for the startup SSD guys, I think there will be a shakeout. You know, and customers have a choice. Do they want to buy a pure SSD box really without the advanced storage data services and architecture, or do you want to take the benefit of SSD and plug it into a proven architecture that's been bulletproof tested, you know, run by service providers? That's really the choice they have today. I think, yeah, I think over time, I think probably a couple of the SSD vendors will get picked up, and I think a couple will make it. I'll sit and watch and see who's who. Yeah, but the startups to thrive, the startups got to be 10X better. That's the number, yeah. And how many of those guys are going to be 10X better? Maybe a couple, and it's a lot of times it's hard to pick which ones, they emerge, they do what data domain did, you know, congratulations. Make a bunch of money, yeah. Yeah, it's all good. I think shakeouts are probably the right word. All right, Sean, Sean Kinney from HP, really appreciate you coming on. Absolutely, this was a class. Always a pleasure, good seeing you. Thanks, Dave. Okay, we'll be right back with our next guest after this short break. This is theCUBE, siliconangle.com, exclusive coverage of HP Discover in Europe and Germany.