 I'm John Furrier, the founder of SiliconANGLE.com and this is theCUBE, our flagship telecast from SiliconANGLE.tv, and I'm joined by my co-host. I'm Dave Vellante of Wikibon.org and John, we have a longtime CUBE alum, Scott Generow, CEO of CloudProvider, Nirvonix, and Scott, we've had you on many, many times and we've seen a really interesting evolution of your career and now you're disrupting your old career, if you will. And we're joined here as well by Dan Brackett, who's the CTO of Extreme Reach and Nirvonix customer. We're going to get the customer perspective, maybe do a little in-depth case study here, John, and we've seen a lot of storage action going on at the show. I mean, it's all about disruption and business models, specifically, and obviously the enablement of lower cost, higher performance environments, whether it's hardware, apps, and now with Cloud. Scott, you've been on theCUBE, going back to 2010 VMworld early on and been with us. So, tell us what's going on right now with Cloud Storage. Obviously, it's a major disruptor. You're the CEO of Nirvonix. You're out there talking to customers. You're developing some cool apps. You've got some great talent on your team, and you've got some big wins recently. What's the update with Nirvonix? Well, I think, is this on? Yeah, so I think a couple things. I mean, first of all, it's interesting because I've been in here so much, it's the evolution of the conversation too, right? Because I remember a year and a half ago or a year ago, we were talking about, is anyone putting data in the Cloud? And as I said, people are doing it. They're starting to use it pretty quickly. What we've seen, obviously, when we look at our last year is we saw huge amounts of growth, triple-digit growth here on year-type growth. And more importantly, when we look, we just finished our Q1. I mean, we booked more revenue in our Q1 than we did all of last year, and last year was a record year for us, right? So a lot of people putting data in the Cloud. Our biggest vertical is rich media. It's one of the reasons we like this show so much. We think what people are trying to do with the Cloud-type architecture makes a lot of sense to use it for rich media specifically. Healthcare is another one. But a lot of it's related to video imaging, that type of data. And of course, backup and archive is still one of our biggest growth areas. One of the things we've been talking about here and the theme of the show is integrating more into the devices, integrating functionality, having the apps obviously power some user behavior. So the idea of box selling has kind of changed. I mean, you ship a box here and someone ships a box here and you tie it together and you got a media solution. In a way, that's happening in the storage business as well, where the big box guys selling hardware are kind of, if they don't go to the Cloud, they are not integrating with the environment of choice, which is the Cloud. So what's your view on that and your experience selling against the EMC's and the HP's of the big box guys like IBM? Well, I think from, I mean, our largest competitor is convincing people in a traditional customer of moving away from box buy. But I will tell you for newer companies, and this is where I think the, call it the Fortune 500, 100-type companies are going to have to change. The new companies that are coming out aren't buying boxes. They're using our Cloud technology and you're going to hear a little about that. And I think that gives them a huge competitive advantages compared to these guys who typically are doing the same legacy type environments. And that's a radical difference. So we're having a lot of success in this space. We're growing. You're going to see in the next 60 days some, you think some of the wins we had last year, which were eight petabytes and five petabyte wins, we're going to announce even bigger ones that we've already won that we just haven't announced yet. So with some big, big name companies. So Dan, talk a little bit about Extreme Reach and we'll get into sort of why you went in this direction and what it's meant for your business. But why don't you set up your company and your role there. Sure, absolutely. So Extreme Reach is the largest advertising distribution network in the world. We have 15,000 media properties, over 7,000 TV destinations in our network online receiving content over the internet, file-based delivery, file-based workflow. We have several hundred web publishers, ad networks, ad exchanges in our network as well. So we provide an end-to-end solution from post-production and the production workflow of generating creative out-to-distribution into all these different video properties. So our idea is video everywhere, which is clearly a huge theme here at NAB this year, the convergence, the idea of TV, online video. To us, they're one and the same. It's a video advertising message that we wanna take across multiple screens and bring with that the robust workflows that involve approval of creative, the production process, the talent management and so forth, bring all that together and make sure that the distribution of that content is seamless and flawless. And that's where leveraging cloud technologies helped us to disrupt that type of a business as well. We had a lot of boxes. We had to displace a lot of boxes. So much like... So you guys pure cloud? We are pure cloud. So much like Scott was describing, displacing storage boxes, our job on the distribution side has been to displace distribution boxes, catch servers at TV stations delivering through satellite uplinks and so forth. That's sort of the way things were done. Previous to that, it was done with tape. We've taken that to the next level. Leveraging cloud technology, storage, distribution network. So real-time helps you? So in the guys creating massive amount of content on the high end or mid-range, you can take all that content into your cloud. That's what you're saying, right? Exactly. And what we're doing is we're taking the original broadcast quality commercial master right out of Final Cut, right out of it. Uploading that directly into our cloud. We provide transcoding to any format in the cloud and distribution of customized formats for every destination. So does that obviously the economics change with cloud? One of the best things about cloud is you buy as you go, right, you don't have to have a CapEx investment of $10 million to build out a data center all over the world with CDNs and so on. So if you can get that, that changes your economics. So you sell a customer, you get charged by the cloud provider when you have a service. So you're right there, it's pretty lean operation. Are you passing those savings onto your customer base? Exactly, absolutely. So we've been able to take that savings, that fundamentally different business model, and deliver that to our customers in the way of savings, in the way of a greater efficiency. They can take a spot from proposed production and have it at ATV network in less than an hour. Yeah, well the show here is all about content transformation. They have, I don't know what the slogan is, but basically it's content transformation, contents everywhere, content is king. And in the news today, the London Olympics, Dave, NBC announces that they're going to be streaming every single piece of Olympic coverage. 3700 hours of live streaming. So just think about what that will do to servers. It's going to basically melt servers. I mean they're going to have a challenge through CDNs, et cetera. So how would you guys fit into that if NBC was your customer? Would you go to those guys and say, hey, use our cloud? Well, so what we provide is advertising content distribution. So as opposed to the streaming of the actual Olympics and so forth, we would come into the play when they're placing the advertisement in that content. So either the ads are being delivered to NBC through the cloud technology, transcoded right to their format that they need, and then they could do the local insertion, or they can be streamed directly through a video ad-serving technology just like traditional internet video. Okay, so if you were, okay, because we get to do different business, but if you were to advise NBC, could they use Nervonix to do this coverage? Scott, what's your pitch to NBC? Are they a customer yet? NBC is one of my largest customers. Okay, so all right, there it is. NBC Universal. Can you talk? Okay, got it. But this is an example. But they have petabytes in our cloud. So but this is an example. They're going to be generating massive amounts of video from the Olympics. Yep. What's their workflow? And they're going to want to monetize it. How would you- And by the way, and the key is, which is really a sweet spot for the cloud is, and they're going to want to keep it forever, right? And you can't keep it forever on, you know, tier one storage and putting it on tape is too cumbersome, so you can't monetize it. So cloud is a great fit because the data's available. You can access it. You can pull it back quickly and be able to monetize it. And that's exactly what they're going to do. And that's what everyone's starting to do. So I do want an interesting point. Extreme Rage has been a customer of ours now for probably about three years. Right. You know, really in the last couple of years, but they were a credit card customer of ours. They went to our website, they bought a terabyte of storage, and today they have hundreds of terabytes of storage. You swipe the credit card? Yeah, pre-funding initial prototype system. We built our platform using a credit card. So why did you go to Nuvonix and not, you know, Amazon, for example? Well, we've gone to multiple providers. Nuvonix is one of our primary suppliers. We use multiple different cloud providers for both storage as well as CDN technology. So we view the cloud as a set of resources that we can leverage. Taking core, and we focus on our core competency. We understand advertising. We understand the workflows, the distribution process, and how to work with agencies, how to work with broadcasters. You know, we don't really want to be specialists in storage, and I've done it before. Believe me, it's no fun. And so we've been there and done that. So we want to focus on what we do well as a company and the value that we can bring to our customers and bring in companies like Nuvonix to help us with the infrastructure to make that happen, and it's been a great fit. So you second source the cloud offering, essentially. And how do you create commonality between the processes? Is that something you have to design in? Is that something that you push Nuvonix to do in your cloud suppliers? That's something that we've built into our platform. And we affectionately call it a cloud raid because we have normalized our APIs into the storage so that we can keep things wherever we need to. We can locate them geographically with appropriate proximity to where they will be used. So we've been able to use the cloud as a massively distributed storage network and optimize that for specific uses to allow a broadcaster to receive a file from the most optimal location, so it's very effective. Is it a hybrid? Do you get some on-premise and some off, or is it all external? 100% in external cloud storage. Our transcoding is hybrid-based, so we have some on-premise. We run multiple data centers around the country. So we have transcoding capacity spread around, pulling content in and out of the cloud. So every master is stored indefinitely. We can generate new formats on the fly for that content for whoever wants to receive it. Okay, so architecturally you've created commonality. What about business process? Things like SLA, security, how you define incidents. Amazon, pretty much any color you want, as long as it's black. Exactly. Nivonix actually, when you call them, it hits the phone, I presume. So how do you rationalize the sort of differences there? That's a great question, and that really comes to us to work with each SLA appropriately. And what we end up with is a common denominator factor. So we focus on achieving the right common denominator so that we have a uniform, to our customers, there's a uniform experience, and we take care of managing the back end and making sure we've got the right SLAs for each provider. And the folks in Nivonix have been great to work with, and we're very pleased. I think it's an interesting point, and I think we're going to start seeing more and more of this, right, because one of the things we get asked about is, if I put data in your cloud and my locked in, the answer is no. And Extreme Reach is a great example where you can use multiple cloud providers. In fact, just like you had multiple storage vendors on the floor, having multiple cloud vendors might make a lot of sense, right? I mean, obviously it keeps us both honest. I mean, we've all been vendors before we kind of know that story, right? But also, just like anything, where we see customers using multiple clouds, sometimes they'll put data in our cloud for different SLA requirements than they would for Amazon. Sometimes, to be frank, Amazon's there as a backup in case, heaven forbid, something should happen, right? So, but once again, it really shows you that the capabilities of being able to not be locked in is very real. And it's probably one of the bigger concerns I hear from customers. Typically it's not security, it's not all the things you read about in the press. It's, I don't want to be locked in, right? And so, we're seeing more and more customers being able to implement more like Extreme Reach to show them that you're not locked in. You have choices. And we've got to step up and give you the best service possible to make sure we're getting a fair share. But it's real possible. You want to lock them in with great service. We want to, yeah, exactly. Feature, function, and service. And we do the same thing with our customers. We don't lock them in. We give them a great product and we give them stellar service and they're going to decide if they want to keep that or if they want to move somewhere else. So it's the same thing. It's just an entire ecosystem of companies all working under the same sort of ground rules. Guys, I think this is a great success story with the fact that you're a startup and credit card, debt funding, now you're scaling, now you're number one in an integral cutting-edge segment. Scott, you guys are kind of in a similar boat where you guys are a startup that's growing really, really fast, but you're a different kind of startup. The startups out there, they're doing cloud storage, but they're like Y Combinator. They got seed funding. You know, they're out there, they're not really providing that kind of level support because you guys are in the same conversation as IBM, Amazon, Rackspace. So as a startup, pioneering kind of this cloud storage model, is that hard for you? Because now you're in a big league conversation with the big names, yet you're also growing as fast as a startup. I mean, is it challenging for you? Is it easy? Is it, how do you communicate your message to the market? Yeah, so, you know, is it difficult? Well, you know, when you're growing at the hyper growth we're growing at, I mean, you know, staying ahead of that curve is an issue for any company, right? Which is a good problem to have, not a bad problem. You know, it's interesting. You know, Amazon, Google, Microsoft, all have their niches they focus in on. And you know, when we go after what we call the enterprise customer, they call it the Fortune 500, Fortune 100, whatever you want. You know, we do not see those guys competing against us. And I think one of the big reasons, if you remember, you know, we do public, we do hybrids, we do privates. We do it all, right? And that gives us that flexibility of walking into these bigger customers and have a different kind of conversation. None of those guys do that kind of stuff. You know, the idea that we can move large amounts of data and archive it on a customer's floor and then move it into our cloud is a huge advantage we have that nobody else, you know, does today. So, is it difficult to compete against? When I go into a web 2.0 customer, it's probably difficult to compete because I see Amazon there a lot, right? Because that's their strength. That's where they do. That's kind of where they started. It's not a lot of file size either. I'd like to run a scaled business with petabytes. It's a development environment, right? It's a development environment, you know, created by developers for developers, and that's kind of where they started. We win there all the time because customers like the fact they get functionality from us that they don't get from Amazon. Part of it is support and service and some of those other things. But when we talk about traditional customers, you know, the ones that EMC and NetApp are selling to in IBM, we don't see Amazon a lot. We don't see Google a lot. We definitely don't see Microsoft a lot. We're competing against them buying what I would call a traditional box. And we're convincing them that that model goes away. And it's not just about cheap storage. I mean, listen to the story here around extreme reach. You know, I didn't hear him say that, yeah, the cost structure helps them, but it's the distribution of data and it's accessing data in the locations you need to have it at that's really creating this interesting model that's giving people huge competitive advantages. It's probably one of the biggest things we talk about. I was just at a large university in New Jersey and we were talking about accessing the data in cloud storage. They have cloud storage today. It's a box sitting on the floor. I said, how well are you doing? They go horrible. It was a CIO. I said, you want to know why it's horrible? Because everybody wants to access data from their iPhone, from their Droid, from their iPad. And they want it to look like an Apple device, a GUI interface that looks that way. What they created looked like a mainframe, 1980, you know, coming to a portal. That's not what guys want. She showed them our solution and the feedback was, we could have a hundred thousand people signed up using this tonight. It's a different methodology, a different way of looking at it. And that's the other mega trend is the, and we've seen this a lot, John, as you're seeing these IT intensive companies turn into profit generators, right? Getting out of the sort of managing the storage business, for example. We saw that at Cerner, we see that at NYSE, and USC is another example. You guys are getting petabyte customers. I think to me, as we have getting the pressure to break here, but I just want to say that the extreme reach is a great example that you're showing there, that that's the kind of scale you have. And Dave and I were pointing about the tape issues. A lot of the media guys use tape because it's easy for them, but I think what you guys have is really compelling and the proof points of the petabyte scale, you can bring that real-time value and not have to use tape. You can still use tape, but you can give them a really good solution for these broadcasts. So I think you guys are really ahead of the curve. I think you're early and very much pioneering is a great solution. So to win petabyte scale from Hollywood Studios, from entrepreneurs like this is really impressive. So Scott, thanks for coming on theCUBE. Appreciate it. We're going to be right back with our next segment right after this break.