 from Las Vegas. It's theCUBE covering Dell EMC World 2017. Brought to you by Dell EMC. Hello everyone, welcome to our live coverage from SiliconANGLE Media's theCUBE. It's our flagship program. We go out to the events and extract the superman noise. We are here at Dell EMC World 2017 with Michael Dell, the chairman CEO of Dell Technologies, which is the company that owns Dell EMC. But this is the first year of the EMC World passing the baton formally to the Dell EMC World. There was an event in Austin, small event, one month after the close in September, eight months ago. Michael, great to see you. Thanks for spending the time out of your valuable schedule to come on theCUBE. Appreciate it. Always great to be with you, John. This is like the sports center of all the acts. So I got to go hard hitting question first. You know, I'm a big fan of entrepreneurship and certainly a big fan of innovation and the work that you've done. So on your Facebook page, 33 years, you had that video when you were a kid. I forget if that was how long in that was, but you're still in your dorm room. 33 years ago last week, and a trillion dollars in sales, really pretty amazing. Notice Mark Zuckerberg also commented on your, probably built Facebook on a Dell laptop. Congratulations. Thank you, thank you. It's been fun, it's been exciting, interesting, and thrill of a lifetime. But I actually think the next 33 years will be much, much more exciting. So I couldn't be more excited about the future. It's really good to see you kind of, we talked about it years ago when rumors would be going private. Certainly there's a spring in your step every year. You seem to get stronger with the private, you know, not being the public company. But I got to ask you from an entrepreneurial standpoint, you're the founder led CEO entrepreneur. You can't take the entrepreneur out of the kid. What's the management style? Because when I interview Andy Jassy, Jeff Bezos, they have that founder led entrepreneurial culture, but it's transforming into a management practice now from folks who are through experience and observing what's in front of them have to take on the next 33 years. What is the key to success based on your experience and how are you executing the Dell technologies because you have that entrepreneurial spirit, you are executing, and you have to still grow off this base of a consolidating IT market, go. You know, we've been able to be bold and being private allows us to take on some risks and make some investments and certainly, you know, going private back in 2013 and then the combination with EMC and VMware and Pivotal and the whole Dell technologies family has created a different kind of company much stronger than Dell or EMC were by themselves. And customers have reacted very positively to that. So when I step back and look at the future of our industry and what's happening with digital transformation and then all the assets and capabilities we have now, again, couldn't be more excited about the opportunities ahead. Bezos said on his interview, I'll ask you the same question in context to your world. He said, you know, Amazon started out driving his car around and going to the drop of stuff at the post office and then it became what it is today. And he said he still has the guiding principles that's timeless for his culture, which was lower prices and get stuff to the consumer fast. That's been the ethos of Amazon's culture and a lot of other things wrap around it, but that's been kind of the guiding principles. What is your guiding principles that have been timeless for you as an entrepreneur led CEO? It's been customer focus. It's been big years and listening. It's been understanding the customer's challenges and opportunities and designing the company from the customer back. It's been understanding the technology and then finding the intersection between the customer's challenges and the technology to create the solution. And you know, I think that's stood the test of time for us and worked really well. And wow, I mean, the opportunities ahead of us again are even much, much more exciting. Well, congratulations. I want to ask you the question that everyone's on everyone's mind here at the show. It's obviously the EMC, Dell EMC. Culture's still intact. We gave Howard some props on the combination, the merger of equals. But now you have obviously a strategy I'm not going to deny. It's a pretty good one. Mature market, consolidating, win the game there. You see that happening. But the question that I have is the growth strategy. Okay, cause you now got to have a growth strategy in a hyper flywheel market called the cloud, cloud computing, cloud native, Kubernetes, machine learning, Pivotal. What is that growth strategy as you build off that existing market? Well, certainly with Pivotal, we've got kind of the tip of the spear of our cloud strategy as the platform to develop cloud native apps, the operating system for the internet of things and the digital transformation for many of the largest companies in the world. And then we've virtue stream, we've got a mission critical public cloud for those super high performing, intensive workloads, VMware driving the software defined data center. Everybody wants to have a data center that is software defined. And what VMware has done in virtualization obviously is unparalleled, taking that into the network and into storage. VMware's got incredible momentum. I know you're going to have Pat on tomorrow to talk more about that. When we put all this together with the consolidation that's going on in the existing, you know, several hundred billion dollar client and data center business, you know, the combination together we're very well positioned to grow. I got a lot of heat for a few years ago when I said to Pat Gelsinger, hybrid cloud is a destination that most people go to but I made a comment, I said, you know, the cloud is not a product. Hybrid cloud is not a product. And you can't get a skew on a hybrid cloud. You can't say, give me a hybrid cloud. It's more of a mindset destination of the customers. You said on stage today that hybrid cloud and cloud is a way of doing IT. Explain specifically what you mean by that and how does that translate into growth for you? Well, let me take you back to the internet, okay? Because if we were having this discussion 20 years ago, we wouldn't be talking about the cloud. We'd be talking about the internet and we'd be talking about our internet strategy and our internet product division and our vice president of the internet. And where is all that today? It's everywhere. The internet is part of everything. Internet is a way of doing IT and cloud really is the same thing. If you look at these large public cloud companies what they've done is extrapolated the workload up to the application layer. And that's what we're doing with Pivotal. That's what we're doing with a software defined data center. That's what we're doing with Converge and Hyperconverge infrastructure. And that's why all those things are white hot in terms of growth and customer adoption. The internet was a bubble that burst and everyone had a website, remember that those days. But you mentioned the internet. Let's just stay on that for a second because that's interesting. Software has changed, right? Shrinkwrap software, enter the internet, you download it. Okay, now you have the cloud, it's SAS. So we were just talking in our intro that the role of a software company isn't the business model of selling software. It's how software works within the business model of this new modern era of computing. What's your vision around that? Because a lot of people will say, and I even said to you privately, where's the software play? And a lot of people jump to that, right? So what's your vision around software? You don't have to sell it. I mean, Facebook doesn't sell software. They have software DNA and they're open source, but their business is an application. Can you explain your vision on software? Sure, well, obviously you've got mission critical apps. You've got some of the traditional platform two kind of apps and you've got the cloud native apps. And there's a right place and a right way to develop all those. And it's not a monolith, right? There are many, many different approaches within that. That's why we see it as a multi-cloud world. For cloud native, Pivotal is clearly our platform and a winning platform and has tremendous momentum. And avoids this problem of lock-in that many customers are starting to experience with the public cloud. You can leverage the public cloud but also run them on premise. In fact, 80% of the Pivotal Cloud Foundry instances end up on premise. Then for the traditional apps, the platform two apps, VMware is continuing to do great. You'll see that in the growth of their business and all the success that VMware is enjoying as now part of Dell Technologies. And then for those mission critical apps, like SAP, like Oracle, like Epic, you need a different level of performance and capability and that's where Virtustream comes into play. So I asked you a question last year. What are you most excited about? What are you digging into? You know, what's getting you stoked about the stuff in front of you? You mentioned Pivotal. Obviously, you've seen that change and I think it much draw our strategic front row with Cloud Foundry. This year, what is that thing for you? Is it NSX? What are you like looking, what are you geeking out on right now? In terms of you look at the future, you're making some bets. What are you looking at? What is Michael Dell unpacking the most for you personally? Not so much for the business, you personally. What are you learning? What are you understanding deeper? What's exciting is how all of our customers are engaged in this digital transformation. And we're just at the beginning of this and we're all trying to figure out, hey, how do I use all this data to make my product and service better? And they're all on this digital transformation journey. So again, you put together what we're doing with VMware, the Software Defined Data Center, with NSX, with Pivotal, with Converge and Hyperconverge, the amount of growth in the data, and then all the new computer science, that's the machine intelligence that's being reasoned over that data. Super exciting time. And if you're not excited now, right, you're totally asleep or you're dead. Yeah, that's super. If you're a computer science major right now, that's time to be coding and building stuff. Okay, Pat Gelsinger, what's the conversation with Pat like these days? Because VMware's market cap is greater than HPE right now. That's one of your companies. It's not even part of the, not even the holistic view of everything you got. One piece is bigger than HPE. You've competed with HPE over the years. So you got to go to Pat. You say, you got to watch what you're doing here. You got to tiger by the tail with VMware. What are some of the conversations that you have with Pat Gelsinger? Share some color around how you guys interact. What is he thinking? Obviously he's got some new things with the Amazon relationship. What's the conversation like? Well, I've known Pat for almost 30 years. You know, met long time ago, back when he was at Intel. And VMware's doing great. And the team there continues to innovate in virtualization now with the whole Software to Find data center. I am particularly excited about NSX because what you can do when the network is delivered as code by virtualizing the network and virtualizing all the functions in the network, all the layer four through seven functions and then run that on top of, you know, our open switching, it's a huge opportunity. And you combine that with everything else we're doing. You know, VMware's incredibly well positioned. And certainly for us, when we think about how do you modernize and automate the data center, VMware's at the very center of that. So when you have conversations with Pat, they're like, hey, let's take that beach head, let's conquer that hill. What are some of those conversations when you take them to the ranch or you guys have your meetings? What's the strategy? What's in, you know, take us to the war room? What is, what are some of the conversations strategically? You know, we work together quite closely as well as ensuring that the open ecosystem that VMware has continues to thrive. Because VMware also works with the rest of the industry and that's been an important part of their strategy and important part of their growth for a long time. What you're seeing now is a much tighter collaboration across Dell Technologies. So, Bumi and Pivotal working together. Pivotal and VMware, NSF working together. Dell EMC and VMware working together and bringing together combined innovations in the form of new products and new solutions like the kinds we're introducing here at Dell EMC World. Okay, so you got 33 years under your belt with Dell, your company, Michael Dell's company. Dell Technologies now, whole new future ahead of you. What's your reaction to EMC World now converted into Dell EMC World? Again, you had a little event in Austin, wasn't really kind of as Dell, wasn't really the real big EMC World event. This is the Dell EMC World, we spoke last year. I think we walked back from the party chatting. What's it like this year? What's different? What's your perspective? What's your reaction? Share some color on what you think's happening here. We've been really thrilled with the reaction from customers or partners. I'll tell you, I think initially there was a bit of a wait and see. Customers were like, oh, how's this going to work? I think we're past that. And now customers are seeing that we really are one company and they're seeing the new products and innovations. And the theory that we had that customers would want to buy more of everything from one company is absolutely playing itself out in the wins and the business that we're seeing. And the internet is a great example like how you use that analogy because internet was over-hyped, it popped, but it all delivered, the same, there was pet foods online and everything happened that everyone said was going to happen. It just didn't happen the way they thought. Do you see the cloud the same way? Because in a way you're taking a very cautious, pragmatic approach by saying, we're going to integrate our customers and have this operating environment called multi-cloud or whatever the customers want. Do you see that internet kind of analogy happening at the same now with cloud? Yeah, I think, as I said, cloud is not a place, it's a way of doing IT. And having sold billions of dollars of equipment to the public cloud providers for years and years, what we see the big difference there is that these companies have, again, moved up to the application layer, they've moved to the Software Defined Data Center, everybody wants that. And as we can bring those efficiencies and now with our cloud flex pricing, we see loss of opportunity. As an entrepreneur now, CEO, go back to the entrepreneur, final question for you is, there's always the hustle in the entrepreneur. I mean that in a good way. Mark Cuban talks about it like the same way, in a way like, you've still got to have that agile mindset, never be settled for complacency, baselessness, you share all the letter, kind of points out the same thing, common thread amongst entrepreneurs. What is the Michael Dell zeal right now that you have that you're pushing through your organization that really is more of a, not an order, but more of a mindset, like to be entrepreneurial because it is moving very fast, it's transformation, it's business, it's technical, it's supply chain, it's everything across the board, software. What do you tell your troops to keep their eye on the price? What is that entrepreneurial ethos? You know, we call it please but never satisfied. We are relentless about innovating and improving on behalf of customers and designing our business with the two billion interactions we have a year with customers and taking that input and feedback and making our products, our systems, our services, everything we do better on behalf of our customers to enable them. What's the coolest thing that you saw last year with customers in the transformation of Dell and EMC coming together? What is the coolest customer example you could point to? You know, I saw some customers that used Pivotal to fundamentally change the way they develop applications inside their own businesses. One particular customer showed us that they had 1,500 developers developing 1,000 applications with only four operations people. And the way they did that was they, again, extrapolated up to the platform level using Pivotal Cloud Foundry. That is the nirvana state that many of our customers seek to obtain and we certainly want to help them get there. Dave Vellante wanted me to ask you a question. She says, Michael, with all that money you spent to buy EMC, 60 billion, all the piece parts, you have any money left for M&A? And if you do, I saw a little venture announcement. It looks like the Dell EMC Ventures is kind of coming together, saw that release. So it's good to get the hands in the water. You invest personally through your capital company, but M&A is a lot of activity going on. Do you have any dry powder left for M&A? We sure do and we've already made some acquisitions both in the Dell EMC level and at the VMware level. And of course, Dell Technologies Capital, we're now having a bit of a coming out party explaining what we're doing with the portfolio and the new investments and lots of new investments in machine learning, deep learning, security, and cloud and all the kind of next generation business models that are important to us. Are you going to be involved in some of those decisions? You going to see them all or is that all roll up to you? Are they going to be autonomous? I'm involved in them, but look, we got a fantastic team with Scott Darling and team running the show there and I'm there to support them. Well, great keynote, final, final question. You mentioned AI a little bit, some machine learning. You brought that up. Good to see you not really hyping up the AI and not having to back it up, not promoting AI. Everyone's coming out and saying AI. So I'd ask you, what's your take on AI these days? Because obviously augmented intelligence is here today, but AI's been around for a while, neural networks has been around for years. What's your view on AI and how do you see that impacting Dell EMC short, medium, long-term? I think the potential here is really tremendous. It takes time though. DARPA had this contest to see could you drive a car through the desert, vehicle through the desert 150 miles back in 2004. The first year, I think the farthest I got was eight miles. By 2005, they had lots of cars completing the entire 150-mile journey. Now we still don't have self-driving cars. That was 12 years ago. So it does take time for these things to evolve, but the level of improvement and advancement in the processing power and the learning that's going on in these systems is tremendous. And again, when you have hundreds of billions of nodes and all this data and increase in processing power, it is really a Cambrian explosion. We do think of it as the fourth industrial revolution. To me, that is incredibly exciting. Michael Dell here inside theCUBE. Michael Dell, Chairman and CEO of Dell Technologies. This is the Dell EMC World 2017, the first of the Dell EMC World. Congratulations. Great to see you on theCUBE. Thank you, John. More live coverage here at Dell EMC World 2017 at the Sherbrooke. Stay with us. Be right back.