 from Seattle, Washington. It's theCUBE, covering KubeCon and CloudNativeCon North America 2018. Brought to you by Red Hat, the CloudNative Computing Foundation and its ecosystem partners. Okay, welcome back, everyone. We're here live in Seattle for KubeCon and CloudNativeCon. I'm John Furrier, host with Stu Miniman here, with Wikibon, our next guest, Anthony Lye, who's the Senior Vice President and General Manager Cloud Data Services at NetAv and Yonsei Stephenson. CTO and VP of Cloud Services. Great to have you guys on. Great to see you again, Anthony. As always, thank you. So first, I want to get out there. I know we talked this in theCUBE just to reset. The value percentage of NetApp has significantly been enhanced with the Cloud. What is that value proposition? What have you guys seen as that explosive headroom for value creation that you guys are enabling with NetApp and the Cloud? You know, I think what NetApp has done over now, probably five years, is really pushed itself to embrace the Cloud, to recognize that the Cloud is a very important part of everybody's IT infrastructure, whether it's an extension of the existing IT infrastructure for things like DR or backup, or whether it's, you know, the primary platform for legacy workloads or, as we're all here to do, to discuss the refactoring and rebuilding of applications around microservices. I think NetApp chose, unlike all of the traditional storage vendors, to see the Cloud as an opportunity. And I think it's helped the company and it's helped our customers to operate in what is, I think, by default now, you know, the end state for many companies. It's hybrid Cloud. Yeah. And you guys also made some good moves early on and with the Cloud, we've documented, certainly on SiliconANG, on theCUBE early on. And then as Flash comes in for performance, now you got compute, storage, and networking, all being optimized in the Cloud, creates app developers an environment where it's programmable infrastructure. Finally, DevOps is happening. This is where services and notions of compute has gone from standing something up in seconds on the Cloud to, with functions, milliseconds. So this is changing the dynamic of applications. You still got to store the data. Yeah, yeah. Talk about, Yancy, about the impact of the services piece to the developer, storage, services, provisioning, all that under the covers. Yeah, I mean, we are taking, I mean all of our services that are running in all the hyperscalers, in Google, in Azure, in AWS, and more, and even on-premise. Our view is, our role is always to find the best home for any workload at any given time, even though it's in public Cloud or on-premise. However, storage has always been sort of left aside. It's always been living in this proprietary chunk that is hard to move, and the weight of the data is actually quite heavy. So we actually want to use Kubernetes and microservices and persistent volume claims by taking that data and making that very easily microdouble replicated between locations, between hyperscalers, and sort of adopt a true multi-Cloud strategy with data with it, not only moving those workloads or applications, but the data is key. Sometimes, you want to move the data to compute, and sometimes you want to move compute to the data. And that's been validated by Amazon's RDS announcement on VMware, Amazon announced outposts and on-premises, and the number one thing was latency. Workloads aren't yet moving. This is exactly to what you guys have been doing and implementing today. This is like a real product. You know, I think the reality of the world is while there is a ton of innovation that exists in public Cloud, there are well-documented use cases that struggle with a Cloud-only environment. And I think NetApp has chosen to make each one of those three potential persistent stores equal to one another. So whether that's traditional on-premise and upgrading on-premise environments to get better price performance characteristics, embracing the public Cloud or combining public and private Cloud. So while it's not trivial, NetApp at its core always with software. So moving from a harder appliance, I mean, back in the day, network appliance was the original name of the company to a software-defined solution to being multi-Cloud. You can kind of see that that genesis where it can go. A lot of times the tougher part is from the customer standpoint. So the traditional person that bought and managed this was a storage administrator and getting them to understand Cloud-native applications and DevOps and all those things are, those are pretty challenging moves. So how much of it is education? How much of it is new buying centers inside the company or new clients help us walk through that? Yeah, I would make two points and maybe on to two. So I think NetApp's history actually 25 years ago, NetApp started off selling into the developers who were running Sunwork stations who wanted shared everything and NetApp actually went around IT and put those appliances into the developers. We built a sand business, a very successful sand business with the IT people. Now you're absolutely right. The people around here fall into the sort of the modern-day DevOps characters. The Google calls SREs, the Site Reliability Engineers. And they are a new breed. They're young, they're doing more and more CICD. Storage is an integral part of what they do, but maybe not a primary part. They expect storage to work. We are really lucky. You know, a little company called Microsoft and another little company called Google sell our stuff. So we get introduced into all of those cloud-first, cloud-only sort of use cases. Not just refactoring a primary but building. So we're actually in many cases now very relevant to those people, but we've been fortunate enough to leverage the big public clouds to get us there. How about the, obviously you have a relationship with AWS Google and Microsoft, Microsoft and Google, which you just mentioned. You mentioned SRE, Site Reliability Engineer. This is a new persona that's clearly emerging and it has a focus around operations. Now IT operations has been around for a long time. Yeah, so that. Dev is changing too, but if they sell your stuff, their customers need to operate at scale. Exactly right. This is a big point. Can you elaborate on the importance of this and what you guys are doing specifically to help that? So the Site Reliability Engineer, he is not doing operations. He is actually in charge of running the workload or the development or the application or the product that comes from development. And they have to abide by specific rules that are actually set by the SRE. And to your point, because you were talking about different selling motions and not selling into the storage admin or not selling to traditional IT, this is actually what has actually been really surprising and showcases the power of Kubernetes and how widely adopted it has been, both on-premise and in the public cloud. Because customers are actually coming to us and saying, hey, we had no idea, NetApp was actually doing all of this in the public cloud. We had no idea that you had your own Kubernetes services that actually helped solve one of the biggest problem which is persistent volume claims and replication of data. So it's actually coming and you sort of see how important C and CF is because they are actually educating the market and educating the enterprise space just as well as the new up and coming development team like I've traditionally come from. So I'm actually seeing that it's easier than I would then sort of thought in the beginning. So they are actually becoming more educated about microservices, more educated about how to run. They are actually everybody, almost in any company that I go into now, they have the SRE playbook somewhere in the meeting room somewhere and everybody's sort of getting educated on how they need to elevate themselves from being traditional system administrators into that SRE or DevOps role. And it's also a cultural thing too. They have to develop the, not just the playbook, but they have some experience and economies of scale managing it. And certainly it's a tailwind for you guys, storage, because again, it's also a lot of coding involved. They need a pool of resources, storage being one of them. But the other thing that's interesting, those are single clouds, Amazon, Google. Multi-cloud is really where the action is, right? So multi-cloud is just, to me, a modern version of multi-vendor, which basically is just about choice. Choice is critical. But having choice around the app has become the value created, right? So if you guys can scale with the app development environments, that seems to be a sweet spot. How are you guys talking about that particular point? Because this becomes an under the covers, a new kind of operations. A new kind of scale, pushing code, not just stacking in racking boxes, but really making things, patching security things, or Kubernetes had a security thing. So doing things really, really automated way. This is a- I think the one thing that I'm most proud of at my time at NetApp and what the team does and what the team continues to do is, we took a very, very, I think, deliberate perspective that we would deliver storage, but we would do it in a very unique way, that my background was from SaaS. I spent my entire career building applications. And when you build an application, you run the application. There is nothing you give the customer and say, here, administer it. When you look at a lot of the infrastructure services, they make the customer do a lot of work. So what we did at NetApp was we decided that we ourselves would almost create like an always available protocol that people could just ask for it and it would be there. That there was no concept of setting it up or patching it or upgrading it. And that's really, I think, we have set a bar now on the public clouds that I think even the public clouds themselves have not done. And giving those developers that I asked for a storage through an API and all I need to do is ask for capacity and throughput. Nothing else? That's something to a developer they're like, so now I don't even have to ask anybody with storage skills. I can tell my application to ask for its own storage. It's interesting, you're living in a new world where you need the scale of a system, but the functionality is an app server. I feel like we're living in that app server days where that middle ground and the app development was the key focus. You've got to have both now. You need scalable systems, but really applications and performance. And then you add an additional layer because now everybody wants to be able to use the same deployment script, the same configuration management system, Terraform, whatever they are actually using to deploy it on-premise or in a public cloud, but it needs to be done in a unified manner. And this is why it's so important to be upstream compatible. And there's a lot of companies out there that are actually destroying that model and not following the sort of true cloud concept. Yeah, slap them on the wrist, get in line. Yeah, well I mean if you're going to play in this space with the CNCF and with Kubernetes, you better play by the rules and do the open standards. And so you're actually compatible no matter where your workload resides. So we've been monitoring how storage is maturing in this whole cloud-native Kubernetes ecosystem here. A year ago there were a lot of back room arguments over what would the right architecture be. There's a few sub-projects working through here. It actually blew me away in the keynote this morning to hear that 40% of all applications that are deployed in Kubernetes are stateful. So where are we? What's working? What's good for customers? And what do we still need to work on to kind of solidify the storage data piece of this stuff? I think it's interesting, because I think we sort of ourselves now sort of consider NetApp to be a data company. Storage is an enabler, but what's interesting, everyone talks about their SaaS strategy, their PaaS strategy, their IaaS strategies. I always ask people, what's your data strategy? And that's something I think that the CNCF, Kubernetes themselves recognize that they've done a lot of really great things for compute around the microservices themselves, but the storage piece has always been something of a challenge. And we said about solving that problem, we have an open-source project called Trident that essentially enables people to make persistent volume claims. And if the container dies, they can essentially start a new container and pick up the storage exactly where they left off. So we really believe that stateful is an ever-increasing percentage of the overall application zone. Databases are important things, people need them. Yeah, I would agree with that. And that's developing too, it's early, early on. All right, so I want to ask you guys a question kind of outside the box. Multicloud certainly is part of the hybrid, they call it hybrid today, really choice. Multicloud will be a future reality, no matter what anyone says, I believe that. How is Multicloud changing IT investments? Business investments, technical investments are both. What's your guys' thoughts on how Multicloud is driving and changing IT investments? Well, I actually think it offers you the opportunity to have placement policy algorithms that fit your workload at any given time. For example, if this particular application is latency-sensitive and I created an application that all of a sudden became really popular in Mexico, then I should be able to see which one of the hyperscalers actually has a presence in Mexico City, deploy it there. If I'm under-utilizing my private cloud and I have a lot of space on it and there is no specific requirements, it gives you that flexibility to, like I said, like always find the best home for your workload at any given time. Dynamic policy-based stuff. Yeah, precisely, and it allows you also, I mean, you can choose to do it whether it's based on workload requirements or you can start doing it in a least cost effective route. I mean, do least cost routing. So it actually impacts both from a technical and a business sense, in my opinion. Yeah, and I think there's, you know, you cannot help but, you know, get excited every day with what one cloud delivers over another cloud. And we're seeing, you know, something not unlike the arms race, you know. Google does this, then Amazon does this, then Microsoft does this. But maybe Amazon does this, everyone's doing that. And as developers, we're very keen to take advantage of all of these capabilities. And we want to, in many cases, let the application itself make the decision. Right, so yeah, Amazon's here, got there, everyone's catching up. Competition's good. Yeah. All right, final question. Predictions for multi-cloud in 2019. What's going to happen? Is there going to be a loud bang? Is there going to be a crash? Is there going to be, you know, fruit on the trees? What's the state of the multi-cloud predictions for 2019? Well, I actually believe it's going to become a standard. Nobody should be locked into any region or any one provider. I don't even care if it's on-premise or not up specific. You should be able to, I mean, I think it's just going to become standard. Everybody has to have a multi-cloud strategy. And you can see that, like the ITC report that 86% of Fortune 500 companies are adopting multi-cloud. And I think I'm actually quite far up with this hybrid cloud stuff because in my opinion, on-premise is just the fourth or the fifth hyperscaler and should be treated as such. So if you actually have that true cloud concept, you should be able to deploy that using the same script, the same APIs to deploy it everywhere. As I said in theCUBE, the data center in the on-premise, it's just an edge, a big edge. If it's an operating model, your prediction. My prediction 2019 is the year of Istio. I think we've become enamored with Kubernetes. I think what Istio brings is significantly advances Kubernetes. And we barely scratch the surface, I think, with the service mesh and all of the enhancements and all the contributions that will go into that. I think, you know, 2019 will probably, you know, see as many vendors here next year with Istio credentials and Istio capabilities as we see today with Kubernetes. Anthony and Yossi, thanks for coming on. Great insight, smart commentary. Appreciate it and we should get in the studio and dig into this a little bit deeper. Really a great example of an incumbent, large company NetApp, really getting a tailwind from the cloud, good smart bets you guys made, programmable infrastructure, dynamic policy routing, all kinds of under-the-covers goodness from smart cloud deployments. This is where software drives it, data. Yep, data, you know, data is the new oil. That's what they say, right? If you don't have a data set, you're not very competitive. Thanks for coming on, I appreciate it. More CUBE coverage here. Getting all the breakdown here, the impact of cloud computing at scale, the role of data software all happening here, the CNCF, this is theCUBECon. I'm John Furrier with Stu Miniman. Thanks for watching more live coverage after this short break.