 Back to Silicon Angles theCUBE, our flagship program. We go out to the advanced instructor student from The Noise. We are live in Las Vegas for HP Discover, day one of three days of wall-to-wall coverage, and a lot of exciting things happening here at HP. Obviously, a ton of news is coming down the pike, more coming every hour. Keynotes starting at four o'clock today with Meg Whitman. But a lot of the big news here is around software, software-led infrastructure, software-defined infrastructure, storage. I'm John Furrier, the founder of my co-host, Jeff Frick here, and our guest is Dave Donatelli, the EVP and General Manager at HP Storage. Dave, welcome back to theCUBE. Great to be here. As always, it's always fun to have you here because you run a very large business of HP. It's getting bigger every day. You've been on, I think theCUBE, since we've been doing theCUBE at HP multiple years now, three on our fourth season here with HP. HP is a spring in their step right now. I was just commenting on the opening about the culture here. People are smiling in a good way. They're happy, they're approachable. They got a spring in their step, but they're still working hard. So, how is business? And then we'll talk about the announcement. Sure. Well, we're excited at HP. We talked about going on a five-year journey to really change the company. We think we're making tremendous progress with it. You saw our financial results for the first half of this year have beaten Wall Street expectations of both quarters. And we talked about really this being an IP-led turnaround for the company. And we've been introducing all kinds of new and exciting technologies across our entire business. And we think not only is that important, but we find ourselves at an incredibly important time in their industry. Where I think the industry is undergoing its most significant change in probably the last 20 to 25 years. And we're excited about the technologies we have, both in the current world and to help people get to the new world. When we first did an interview when you first time on theCUBE, we were talking about big data. And big data was just kind of in the early stages of Hadoop and Apache. And it didn't really hit the mainstream radar. Now obviously big data's going supernova right now in the industry. But also you said multi-vendor open was always a big philosophy. How is that accelerated? I don't want to talk about big data because we're going to have more guests on from HP. But specifically to the multi-vendor open, take us where it is now because right now software defined, Bill in the blank is really the hot trend and it's relevant. So how is the open multi-vendor positioning helping you guys from a product and customer leadership perspective? So multi-vendor and open runs across really our entire product set. And I'm sure you'll have folks from PPS on they'll talk about how they're multi-OS, multi-platform now. If you look in our space, EG space, our cloud system now has approximately a thousand customers out there. And that is built on OpenStack and as well as our own HP technology that supports multi-vendors. Multi-vendor hardware, multi-vendor in terms of virtual devices supported, virtual machines supported and multi-OS's. And then if you look at today, we made some more announcements in the storage space. If you look at software defined storage. And there we have both direct storage products as well as backup products that support multiple hardware vendors, not just HP but others. Multiple virtual machine types, multiple OS. So we think it's a key part of our strategy whether it's in storage, whether it's in networking, whether it's in servers. And the great news is it's not just talk, we have products that people can buy and use today and get great value from. It's not just a storage conversation anymore. And one of the things I noticed on stage is that Jim Ganti was on there as well as David Scott. So storage is still going to be needed because storage isn't slowing down. But it's being abstracted away. The talk about software and across multiple environments opens that particular points to what enterprises want. That is a manageable cloud, a manageable data infrastructure. How is storage conversation moving to data management and data infrastructure? And do you see, what do you see happening from a product and business standpoint around data management? Well I think from the enterprise, one of the big challenges they've always had data is really seamless movement, seamless tiering, seamless performance. And so if you look what we've been doing, this is really a software problem. Storage themselves, storage arrays themselves are really software operating systems are really what run storage. And so what was exciting about a lot of things we announced today was really giving people one architecture that they could deploy in multiple ways to meet many of these challenges. So as you know, today we announced a flash array. It's an all flash array. It has incredible performance. But it's just not a standalone siloed flash array. It's part of the whole overall three-par family that enables people to seamlessly move data between tiers within an array but also seamlessly within arrays. So as companies have to deal with this influx of data that they're seeing, they want to be able to do that with less management time. They want to do that in store less data. And they have to do that at a lower cost. And we think we're addressing all of those. And that's why you're seeing so much growth in our storage business currently. Our converged storage products last quarter grew 48% year over year. Much faster than before. Three-par has just been a great leader there. And Jeff and I were talking about before you came on. We always talk about startups. And startups always have that shiny new toy. And flash has been a big part of the startup scene in terms of growing companies. But HP really doesn't just jump into things. And you run a pretty large part of the business and now flash is into the portfolio, right? So what have you learned? And what do you see flash? How does that fitting into the, because you have a huge install base and you got new customers you're attracting. So you have to make the right calls on flash. And so what is that? How do you see that evolve? What's the beachhead for today? And you land and grow? What's the strategy? Sure. And just to talk about startups for a second. If you look at three-par and we'll talk about how that's morphed into flash. When we bought them there, doing approximately $190 million in revenue, we announced last quarter, we're in excess of now a billion dollar annual run rate. So we've seen huge customer acceptance, huge scalability with that. And if you look how flash has evolved, you know, several years ago, three-par had the ability to have flash within the array and then the ability to automatically move data amongst tiers. And that was all good. But we've also seen a need really to have just full flash arrays as well. And there's a lot of startup activity, you know, as we discussed in that space today. The challenge is this, is that customers have been faced with what I call compromise solution. So traditional storage, you know, if you will, old line storage, did not have the bandwidth, let's talk about non-three-par, did not have the bandwidth to really exploit the full level of flash. So in essence, they could support flash drives, you could put them in there, but you want to see the full performance because the array would bottleneck out. Startup said, let me solve that problem. I will get you a very, you know, non-bottle-necked flash array. The problem was it had no software on it to help manage it, make sure it's resilient, do all the feature function that people want. What we did today is say, we'll give you the best of both worlds. Three-par by its architecture is non-bottle-necked. So we can see the full performance of flash. At the same time, we have that full software stack that it gives you all the feature function you need for the enterprise. And it's part of a bigger family. So you can have an entry-level three-par, a flash array-based three-par, all the way up to a high-end three-par. And we think that's very, very unique. And then where it's going is that HP is already working on next-generation technologies here. And these are non-bottle memory technologies like Memistor, which I think we've discussed on the show before, which are going to bring even more non-bottle high-speed into both servers and storage, and it's going to completely change the infrastructure stack, I believe. So the software, you know, on my Forbes article I wrote, you know, you talked about the storage business, I changed Craig Noon as I quoted him, because I had a great interview with him as well. It's really a new phase to the storage industry. And I use that kind of generically because it's now a little bit more comprehensive in terms of product mix. So I have to ask you, obviously the old storage world, which you've been a big part of, going back to your career, has changed a lot. So I want to get your personal perspective. I mean, you know, I won't say, you know, which companies do this, but there's all these reports like people have put debuckets, your pure play storage. I mean, how has the storage company changed relative to this new industry landscape? Because now you have, you know, some customers saying, I don't care what I buy for storage, I want software. Or I'm going to store on HP, EMC, IBM. So storage is becoming a commodity and that's just a natural progression. So now the software conversations on top of it. So, how do you say it? So my belief in general is it's not becoming a commodity. Yeah, I think because of all the feature function that has to go in there, which is you're correctly saying is driven by software. And again, when we talk about software and operating systems, I'm not talking about Linux or Windows, I'm not talking about, you know, specifically written storage operating systems. We think is what's happening. But I think what the bigger picture is this is that for 20 to 25 years, we've talked about everything individually. Storage stack, networking stack, server stack. In the new world, those are all merging. So you can't just be a standalone and you can't just design in that vacuum anymore because it's not going to work with the other people. So you're saying silos don't work? Silo's will not work going forward. And then I think the market is further segmenting. You know, you have your traditional enterprise market and then you have the new, you know, cloud-based marketing, cloud-based storage is where you'll see a lot of software defined storage because they want to build customized servers with storage on top, running those operating systems and again, reduce the cost, reduce complexity. So you know, a lot of people might not know that you're a product guy but also you're very customer focused. So I want to ask you kind of a question that kind of, I want you to kind of go on both sides to keep that hat on both sides. What do you hear from customers right now, the big HP customers and potential customers that you don't have yet when you go talk. I know you do a lot of traveling. What are you hearing from customers right now in terms of what their business needs are and how does that render into a technical solution? Sure, so on the business needs, I think it's actually very straightforward. They all want to get more agile. They want to respond to their business much faster than they have for a long period of time. Two, they want to simplify. Their current infrastructure, they think is too complex, too fragile, takes too many people to manage. They've got to make it simple. Third, it is a very rare company on Meet that does not have some form of IT cost reduction goal. So, you know, they're being asked to do a lot of very new things very, very quickly and do that much more efficiently than ever before. Those are the big customer requirements we hear. I think what we're seeing out there is that the move to new style of IT is happening at an accelerated rate. So we've been talking about this, you know, for several years, many of the early adopters have already been out there adopting. But we're seeing with each progressive quarter is people are moving faster. And which style are you talking about referring to? IT as a service, is it more? A lot of service led IT, you know? So, whether it's their own private cloud, whether it's a hybrid cloud, whether it's public cloud use, going up a lot. Software bought as a service, you know, consumed as a service, I should say, happening a lot more. Moving to different architectures than what prior generation architectures have been, happening. So, you know, we're not saying everybody in the market has moved because it's going to take a while to move everybody. But I can tell you, we are seeing this at a faster increasing rate by the quarter. So on the hyperscale market that Dave and I always talk about, it's like, it was once called the web scale. You had the Facebook, you had the Twitters, the Pinterest, and they had to build their own gear or buy a lot of HP gear. Some actually build their own, Google builds their own, the other ones actually build their own, I think. The rest, I think, pick HP customers. Unconfirmed. But they're massively building out. And then on the other end of the spectrum, you have the generic enterprise. And everything in between. So, the basic enterprise are buying commercial, general purpose hardware software networks. And then they bought Oracle. And then on the other side there, there's a lot of homegrown open source. And then there's like this big, fat middle. The, I call it, mid-range hyperscale. That's where everyone seems to be wanting to go to. And it's a little bit of open source. If they need some software-led infrastructure, how do you see that market? How do you guys talk about that internally at HP? I mean, I'm just putting, that's what, those are our words that we talk about. It's a very big question there, right? And there's a lot we can talk about. I think at HP, our advantage is that we plan today's market, which is what you described, the current enterprise. But we're also very big in the cloud market. And obviously the cloud market is doing things very, very different. Like you said, much more open source focused, much more scale out focused, new storage, new networking, new server technologies. What we believe we're doing is we can obviously always help people in the current, but we can take everything we're learning here, all these new market technologies, and bring them to the enterprise. And you see examples of that all the time. You saw that today with our announcement on the, you know, software-defined storage. You saw that with our announcement of Moonshot. I mean, the inspiration from Moonshot came from looking at these large cloud providers and saying, look, running traditional servers is unsustainable going forward. You literally cannot get enough power and enough real estate fast enough to keep up with the growth rate. So those technologies, believe it or not, are very applicable to the enterprise. One of the things I'm going to show on my keynote tomorrow is how HP ourselves as a company is using them to run our business. And we believe customers an increasing rate will use it for theirs. Simply put, for the reasons of it's simpler, it's more flexible and costs less money. Yeah, I think that's a great opportunity for you guys. And I think that mid-range is going to explode because people look to Facebook and they want to be like Facebook. In fact, EMC actually used that in their keynotes when the EMC world, it's funny they actually said that. So I think that's kind of like a, people look at that, but it's not as easy as to pull it off. I know we're tight on time. We got a very busy schedule. So my last question, Jeff didn't even get a question. Maybe Jeff, you want to ask a question? Well, no, I was just going to say what are some of the things that customers are being able to do with this new infrastructure with Flash, with suddenly having all that available that they could never envision before? Yeah, well, I think with Flash, I mean we are seeing a Flash revolution and Flash like all new technologies started very expensive. It's going to keep coming down to price. We see it used in our servers. We see it used in our storage products. And we think that's very, very exciting. But what I really believe is that if you look at all these new technologies we're inventing, it is enabling the next generation of either analytics, big data, mobility, and software. Because it's my fundamental premise that the cost of technology has to come down so that more of these new models can flourish. And the more that we do that, the more that we've always bought costs down in our industry, the more new technologies happen. And so if you look at big data, the concept's not that new. It's just been unaffordable before. Well, you're enabling innovation. See, what you're doing is, you're lowering the cost church, but you're enabling more. If you look at OpenStack, great example. Enterprises love OpenStack because it's like a warm blanket. It's so early, but they want the cloud, but they don't want necessarily go with Amazon. Well, they want a trusted partner. And what HP has done for just about 75 years next year over the 75 years, has been that trusted partner in the enterprise. And what we're trying to show people is, we can give you all the latest and greatest, but you can do that with a trusted partner that can help you do it. Because to your point before, most companies don't have the scale of Google. They don't have the 400 PhDs just working on infrastructure. We have more than that and we can help you get that in your own environment. Well, this is theCUBE. I want to ask one final question, a personal question. How are you doing? Obviously, you've been on a rocket ship at HP. You guys have been growing. A lot of changes. You guys are doing the turnaround plan. Things going right along on schedule. How has your organization, the folks who've gotten to know you on theCUBE and what's going on with you? I mean, how's the organization? How are you managing? Just share some personal insight. Well, we're obviously working really hard. So for all our customers out there, we're working really hard to bring you great products and great services. And our big goals this year are to always bring out these new technologies. Again, today was a great example of that. And there'll be even more announcements coming soon. The second big thing we've been working on really hard is to become a much easier company to do business with. And we think about that every day. Either with our partners, and about 66% of our revenue comes from our partners, or with the other percent who we serve directly, is we want to be, even though we're a large company with 300,000 people, we want to be as nimble as we can be, as quick as we can be on the response, and make sure that we always provide the best service. And that's what we're focused on. Same work structure. Everything's all set. Do you work structure? We did a big change last year. Yeah, so it's nothing from last year. And we are sticking to the EG award structure. Okay, Dave Donatelli, the leader of the enterprise group. It's getting bigger. It's now software driven across all their products. General manager as well. Manager, huge part of the HP business. Very successful one. Congratulations on all the three part. Love that success story. A hundred, somewhat million in revenue startup gets bought by HP. Now, billions of dollars of value. That was a great move. Congratulations and now adding flash, that's going to be good. Big news here at HP. Dave Donatelli sharing that with you on theCUBE. We'll be right back with our next guest after this short break. Thank you.