 Okay, welcome back. This is SiliconANGLE.tv's theCUBE, our flagship program. We go out to the events to talk about the top tech trends and extract the signal from the noise. We have a special broadcast here today. We're in Silicon Valley live at the Brocade headquarters in Silicon Valley for Brocade's Analyst in Technology Day where they're showing off their new Ethernet fabric technology that's going to change the game in the data center. Anyone who's doing virtual machines or network virtualization, this is an emerging technology that's very, very well positioned. Probably one of the only set of products that are positioned to essentially capture the massive growth in software-defined data centers in Brocade, a company that's kind of independent networking player, unlike Cisco and Juniper and HP, positioned to actually ride this thermal growth up. And we're excited to cover it. However, there's also other news that's bombing today on the internet, and that's iPhone 5 and other news. So I'm John Furrier, the founder of SiliconANGLE.com and my co-host here is Wikibon's analyst, Stu Miniman. Stu. Welcome to the little news segment here, broadcast from Brocade's live headquarters for their big fabric. Before we jump into some of the news about the iPhone, I want to just get your take. We had Mike Claco, the CEO of Brocade on, who recently announced that he's going to step down as CEO, and I believe stay on with Brocade as an advisor and kind of shepherd that, but they're looking for a new CEO. Obviously, their company is not one of the big known players like Juniper or Cisco or HP, but have had a nice independent position doing well financially, really well in the fiber channel market. You've been covering this sector pretty deeply for your career, networking in ethernet and fiber channel and fiber over ethernet. What's your take on Mike Claco's conversation and what Brocade's doing? Yeah, so John, I think it resonates well. When we look at the big trends that are out in the marketplace, they're hitting it right on. I might quibble a little bit with, we were first with OpenFlow. Every single networking company is involved in OpenFlow. Everybody's signing up for OpenStack and there's actually, the debate is, should everybody be in OpenStack and who's going to slow it down and who's going to own it and all those pieces? But there's the politics in all of those type of committees. But the bottom line is two years ago when you and I interviewed Mike Claco, the challenge I put to Brocade is, people think of Brocade as a storage company. They're a trusted brand. Every storage company OEMs them, EMC and HP are their big customers, IBM and Dell and Hitachi, everybody uses them and they bought Foundry. And Foundry was an interesting company and they had some nice technology but they weren't sure if Brocade could make the pivot. Fast forward to today and Fiber Channel got a brief mention here. This is all focused on Ethernet. We know that's where the growth is. Brocade is dominant in the Fiber Channel business. 70% market share. It's not a shrinking market. As a matter of fact, what the numbers they're showing is kind of a two to 5% growth, which is respectable with great margins, especially when you've got a dominant market share. But that's a $2 billion a year business versus the $30 billion a year business on Ethernet. And if Brocade can move from that 2% to 3%, their stock has lots of upward growth potential. Yeah, I mean, obviously the iPhone, we're going to get covered in a minute, but the iPhone and cloud and all this stuff going on that's exploding in the consumer market as well as the enterprise really is powered by stuff that's under the hood. And under the hood is the Brocades, the Cisco's, the Juniper's and the HP's of the world. But what I found interesting is that when I asked them about the rollout, I asked them specifically, customers and then the emerging OpenStack and OpenFlow. So, I mean, you have talked about this. I mean, OpenFlow and OpenStack are emerging innovation environments far from baked. However, robust, whether you're looking at it from a marketing standpoint, companies have been criticized for jumping into these areas, quote, you know, software defined network washing, if you will, or just being, you know, from a marketing standpoint, they have a cloud strategy that are involved in OpenStack, but there are some real development going on there. That's separate from the action in the marketplace. So, I want to get your perspective on Brocades' chances in the real world. Okay, putting OpenFlow and OpenStack aside, it's kind of an emerging kind of category. Let's look at Brocade with the Ethernet fabric going into production that got 700 customers. What's your take and analysis of their chances and their growth strategy? So, we knew. I mean, if you look a year ago when Brocade brought everybody here, that the missing piece of their Ethernet fabric story was, it didn't grow big enough. It's a nice, simple solution to deploy. Customers that I've talked to really like it. We did one of our peer insights on Wikibon, actually, with Pete Colo, who we'll have on today. And he just said, you know, adding and removing switches is seamless. It just works. And that's nice because, you know, networking has a lot of times been something with a lot of manual pieces. I need to configure it. I need to, you know, worry about how many VLANs I can put in my Layer 2 environment. You know, there's so many challenges to kind of keep the operations running, but it didn't scale big enough. And that's the 8770s, a little late from when Brocade said they do it, but it's going to be shipping in three weeks and it really helps broaden out that portfolio. I want to ask you specifically, one point on what he said. Mike Claco, the CEO of Brocade said, they're falling out of their chair. Customers are falling out of their chair. There's a lot of demand and they're falling out of their chair on this product and this new tech. Why? Why are they falling out of their chair? It comes out of simplicity. What they talked about, the problem is lots of new technology. They say these have great speeds and feeds and great features, but we know the capital expense is a small piece of what I'm going to spend. We're having a good debate last night with some of the networking guys and they said, my operational expenses and my licensing is where everything is. Hardware gear is a rounding error almost for what they do. So what problem are they solving? It's the people problem. This is just the IT staff with that explosive growth that is out there. Every time I add a switch, if I've got to reconfigure my environment or make too many changes, that's difficult. IP was made for, oh, I can pull down a switch and I'll reroute and I'll retry and it'll work, but if it's rock solid and I can just grow and scale easily, simply, that's going to make my life so much easier. So two things, there's a cost side on the one, scalability, the pure infrastructure, scaling the environment, and two, it's the labor cost. Right? It's when I need to grow, how long does it take me to do that? And it's the man hours and- So speed of provisioning? Yes, the agility and the simplicity is really what it comes down to. Okay, Brocade Day here, the analyst day here, technology day, this is theCUBE. When theCUBE special broadcasts, we love to do these tier one vendors like Brocade, go to their offices and hear from their executives. We're going to have a big lineup today. We're going to talk all the top people. And so we're very excited to have a Brocade Technology Day here at theCUBE. Now back to industry news. I'll see the top story today on SiliconANGLE and throughout the world is the iPhone 5. Stu, I got some notes here. It's all over the web. There's a variety of different blog posts. Go to siliconangle.com. And of course, there's the free commentary from Stu and John right now. So here's the bottom lines, Stu, on the fact that we can have a discussion. So 18% thinner, 20% lighter, cool. So form factor changes, the Retina display, awesome. iPhone just rocks the house with display. They continue that with the Retina display 326 PPI screen. The screen size is now four inches display, hand friendly, very display friendly. So if you have columns, you add another column of icons on a screen, better for email. Web page is now going to do really, you know, more displays for all kinds of interactions. So it's going to help on one user productivity and also gaming and video and whatnot. Screen resolution, it's great. 16 by nine aspect ratio, 40% more color saturation. But the bottom line on the iPhone five, in my opinion, is the LTE and the radios and the single chip that they have for essentially connectivity. Cellular connectivity, 4G and now LTE, long-term evolution is the fastest cellular out there. Huge advances for the iPhone five. And they're doing this with a single radio, single chip and dynamic antenna. This is a huge upgrade right there. That's going to provide more connectivity. And the risk here to do is the battery life. They've actually extended the battery life. So the, of all the pundits out there saying, oh, it's really not much of an upgrade. This is a massive upgrade because one capability wise, and from a geek perspective, that's really, really hard to do. And I- I tell you, John, I mean, you know, I'm a big into the Apple ecosystem and battery life is the killer app for me. It's like, you know, when I'm traveling, you know, I don't always want to have to be plugged in. Everybody joke that, you know, 20 years ago, you were talking on a phone attached to the wall and when Google came out with the Android, they brought us back to that because you always had to have it plugged in. And that's one of the reasons that keeps me in there. I mean, there's some great droid phones out there, but if I don't have the battery life, it's useless to me. Yeah, battery life is a killer app. I totally agree. Other highlights here, Stu, that I think is notable is the A6 processor. It's two times faster across the board, both on CPU and graphics, and it's 22% smaller. So this is Moore's law. We were just at IDF yesterday, kicking in. Smaller, faster, less expensive components, and lower energy consumption. That's the trend. We heard it from Intel yesterday. John, on the network, because that's a big concern, especially, you know, I'm an East Coast guy. I tell you, I have AT&T, and I don't have problems. It works for me fine. But when I go to Vegas, when I come out here to the valley, you know, AT&T just sucks. So I've heard a lot of people that said I'm getting the new iPhone 5, and I'm getting off AT&T. You know, you're a valley guy. What's your take on it? I don't have a problem with AT&T. You know, I live in Palo Alto where Steve Jobs used to live, so apparently they must light that up pretty well. But, you know, I generally have not had a problem with AT&T in the valley. But again, as more people use the iPhones, it's congested. Obviously Verizon has LTE. It's pretty saturated out here. So that's to me an easy decision. I'll go right to Verizon. AT&T, it's all about speed for me. So I'll go to Verizon. So back to the iPhone. The camera, eight megapixel sensor, 40% capture on the camera, 1080p video. FaceTime HD over cellular. Big, big point there. So now you can do FaceTime actually over cellulars do. So, you know, FaceTime's an interesting one. I've played with it. It's interesting technology, but I still default to Skype because that's what everybody has. No, the problem with FaceTime is you need, everyone's got to be peer-to-peer on Wi-Fi. So now that completely changed the game. So we can now do it over cellular with LTE. That's going to be fantastic. It'll still be slow adoption in my opinion, but ultimately when the network gets better, thanks to Brocade, of the Brocades of the World, it'll be faster and great. The other thing is obviously the audio's great. Three microphones, top, bottom, and side, so microphones better. They have the Thunderbolt and Lightning technology. Lightning is new. Thunderbolt is part of the Max. That's for high-speed transfer of files. Lightning is now the connector because it's smaller packaging and with the components, they had changed to a new connector. It's called Lightning, Thunder, Lightning. And so you have to get a new connector for that. iOS 6. Yeah, I hear there's going to be adapters. So the 30 adapters I have littered in every bag and what I have, now I can just carry around one adapter maybe and it'll allow me to do it. You'll need a new adapter for the lightning of the iPhone. And finally, it's going to be available on 21st with pre-orders on the 14th and it's going to ship on the 21st. So pre-orders on September 14th with the iPhone 5. Stu, here's my take on it. I mentioned it on Twitter. This is not a revolutionary announcement, but a major upgrade, solid marks across the board. Obviously, I think doing the single radio chip and the single chip is a huge deal without sacrificing battery life. They actually got extended battery life. That's a big deal. LTE is a huge upgrade. So upgrades across the board from a functionality standpoint, that's the Apple iPhones. Not a laggard announcement of any way. It's a solid announcement and very worthy of an upgrade. Yeah, no, you know, everybody I'm talking to out here is pretty excited about it. Lots of people I know will be getting it day one or getting two of them day one. So, you know, there's definitely certain features, some seems that, you know, others pass, but, you know, there's only one iPhone. Other news, just around the web, that's not as solid as the outside. The iPhone is dominating all those top stories. It's broke hate announcing their new Ethernet fabric products and technologies. SiliconANGLE.tv, it's a Splunk conference going on in Vegas. Intel developer forums going on in San Francisco. And Stu, my assessment there yesterday, we were up there scouting the landscape, doing a mobile cube. Intel is awesome and their mission is fantastic. They want to enable the life, embedded systems. They're intelligent systems. Intel's right on the right track. Love what they're doing. And again, it's just, you know, faster. And the thing about Intel is the storage is much more strategic now. You're seeing the data center and the services combined. So, you're seeing this software-led infrastructure messaging you're going to hear from SiliconANGLE and from Wikibon's core research. Stu, real quickly just share with us the view of what's coming around the pike around software to find infrastructure. Give a little tease. So, one last piece on Intel, actually. There was an announcement that the networking people are all buzzing about is that Intel's going to pull some of the fabric inside to their chip and they've got, you know, like a top of rack switch to try to commoditize the network. So, we've seen, you know, commoditization of, you know, every type of infrastructure is important. And as the hardware gets commoditized, you know, software is really where the value is. One of the things we want to dig in with some of the, you know, real deep guys here at Brocade as to kind of merchant silicon versus, you know, custom ASICs. Got some service providers on here. Some of the networking geeks and, you know, lots of good stuff to dig in on the network. And all of them are excited about the iPhone because it's more bandwidth going over all the network. Yeah, the iPhone 5 really highlights and the end users and communities of what's going on under the covers. Siliconangle.com has been covering reference point for innovation with Wikibon.org, Research Analyst. There's a lot of action going on under the hood right now in the tech business. It's not as sexy as some of the iPhone kind of stories, but there's a lot of action where we go out to the events, we extract that action, signal from that action and share that with you. This is Siliconangle.com. We'll be right back with our next guest.