 Okay, we're back live here at Hadoop World 2012. This is theCUBE, siliconangle.tv, siliconangle.com's flagship telecast. We go out to the events, talk to the smartest people we can find, CEOs, entrepreneurs, analysts, authors, famous consultants, famous book writers. Whoever has the signal, we want to extract that and share that with you. I'm John Furrier, the founder of siliconangle.com. I'm joining with Jeff Kelly, my co-host this week from wikibond.org, and we're joining with Jeffrey Moore. Who is the famous author? I'm crossing the chasm inside the tornado, among other things. Have seen the many cycles of innovation. Jeffrey, welcome to Siliconangles theCUBE. Nice to meet you. I'll try to be more signal than noise. Our job is to extract the signal. Okay, that's your job. I'll let you, okay. Hope it won't be too much work. We will extract the signal from you and share it with the audience. So, you gave the keynote here, and very interesting because, you know, obviously your books are well-documented as being really the cornerstone for some of the business strategy around companies going to market, and as markets develop, you've been a consultant, you've written the books, you've seen many companies be successful. Tell us from your personal perspective why you think big data and the aspects of what the technology underneath is evolving is so important. Well, I mean, the thing that's important is we're putting the entire world on the web. So we're digitizing, we've digitized consumer experience, and now we're going to digitize business and government experience, education, healthcare, the whole thing. And the tool set that you need to do that is so drastically different than the way we thought about data before. We always thought about data before as something on the side or in the background or in the history. It was a before or an after. It wasn't a during. But in this world, it's clear that it's the sight and sound of the web. And if you don't have big data and analytics, you're blind and you're deaf. And you're probably in the middle of a freeway and about to get killed. So it's really, really important that we get this at the speed. The early media guys pioneered the space. It's not an accident that Yahoo! is the founder of the Hadoop stack. But now it's the rest of the world figuring out how do I incorporate this, when do I incorporate this, do I have to do it now, can I wait, that kind of stuff. Yeah, so we had Omar Awadallah, the founder of Cloudera on theCUBE, when we first started doing this. And I asked him about Cloudera. He says it was the first real company to start up to come out and commercialize it. He says at Yahoo! he saw the future. And he wanted to kind of bring the rest of the world there. So the question I want to ask you is along those lines. So in the first time in the history of business, we can actually instrument someone that's going to actually instrument their business end-to-end from acquiring raw materials to actually selling and servicing and making money. I mean, complete instrumentation. And so, you know, we've had books about process improvement, value change. So how does all this going to change the business mindset of that? Because not only do they have to cross the chasm, there's a lot of re-engineering going on in businesses. Yeah, in fact, I think you got it. It will not be monodirectional because when you have a technology disruption, but you have a human social context for it, the two interoperate with each other. So the human society will push back and actually slow down a bunch of the technology. Because they'll just say, look, I can't do this all at once. And so what happens, we see this technology adoption pattern again and again and again where early adopters actually say, we're going to grab on big time early on with a project-oriented model. So they will do projects. And they'll be either successful or unsuccessful, but the ones that get a lot of visibility are very successful. The rest of the world hangs back and says, it's not ready yet for me. And then at a later date, particularly around painful use cases, they'll say, well, I'm not sure I'm ready for Hadoop for everything, but for this one use case, I'm really desperate, so I'll try it here. And if that use case is repeatable, then there's a market that's created just around that use case. And then at some later date, it's like, hey, you know what, it's a lot of use cases. It's really horizontal infrastructure. And the question that you ask, it's important for the vendor community to get a sense of is where do we think we are today? And so in my talk today, I suggested we're still in the early market. We're still completing the technical whole product around projects. If you look at the tracks at the conference for the last two days, they're largely around the technical whole product. They talk about use cases, but usually exceptional use cases, the same use case recurring over and over again. But there is a different use case, by the way. Anybody want to shoot to that? But anyway, and so I think the question at some point will be, when is it time to cross the chasm? But I think there's still a bunch of work to do what we would call the early market still. Let me ask you a question about just observationally, anecdotally, based on your history, looking back. And sometimes history can predict the future in a way, but not always. Things are always different. But what do you think companies need to do to be successful in this market? Because there's a lot of theaters kind of where the bombs are dropping. Microsoft's announcing that they're buying a company called Yammer today, that it wasn't around seven years ago, and it's going to be a billion dollar acquisition. It's a social network. Yeah, I know David. You know, David Sacks, you know, PayPal Mafia, great guy, he's been on the Cube. That's going on. You've got VMware, EMC. You've got infrastructure change that's affecting IT and converging infrastructure. And you've got applications and analytics. All these theaters are exploding. So what does a company need to do to be successful, given it's not the old linear go-to-market path anymore? It's a lot of zig-zagging. Well, in fact, it always was zig-zagging. I just think it's happening on a bigger campus at a faster pace. But so I think it's this notion that if you're in the early market, the key to it is I need to adapt my business model to the life cycle, to the adoption life cycle. And you're not going to be great at every part of the life cycle. So the first part is, well, who are we? So people who are absolutely stellar at the beginning are the technologists who do projects. And then once the thing crosses the chasm and becomes more mature, their creativity typically is like, well, we don't need as much creativity now as we need scale and reliability. And so you guys have to either learn that or maybe you should go off and invent something else. When you cross the chasm, it's that use case domain expertise. That's where the market is looking for. So this is kind of a weird time where application vendors, even though the technology is very new, it's actually the application vendors that lead the parade. And that happens while until the world is really ready for horizontal application of the technology, it gets adopted in verticals, particularly with business applications. And then there's a time when it's like, no, no, no, no, this is a relational database. This is a Hadoop. This is whatever it is. And every industry is going to adopt it. And then that's when the horizontal guys, like the Oracles, the Microsofts, the VM, they say, look, it's not VMware but it's a virtual services industry. This is like virtualizing anything, right? But there was a time when it was VMware for very specific use cases. You talked about on stage, I had a good chuckle on this one because I'm 46, I'm a little bit younger than you, but I've been around the days when IT was the old IT. You mentioned that for an IT guy looking at all this, it's kind of different, right? There's a lot of different dynamics going on. And we were just at, with Intel in New York City a couple days ago, we were on this cloud conversation. What came out of that was the business model was the conversation around cloud computing. Here, with analytics, with the iPads, the iPads has gotten the CEO saying, I want stuff on this. And the business conversations have been going to IT saying, make the change. Where IT used to be the master, right? So how do you grok that? I mean, you've seen both sides. You've seen the IT world, IT centric world from mainframe to client server. And now we have a real time world. The interesting thing about the dynamic you just described from the dynamics of the industry is the only thing that was close to the CEO having the iPad in my history was back in the 80s when it was initially an Apple II and then it was a PC and you were trying to sneak something into a spreadsheet. I'm sneaking that into the enterprise. But at that time, of course, the IT guys were like, no, no, no. So this time instead of having it come in from the bottom came in from the top. And then the IT guy said, well, he's my CEO. What am I going to say, right? So then what he does is he says, okay, okay, okay, we'll put a special SWAT team on it, right? And we'll surround the CEO with services and he'll have a good experience. But then the CEO goes, great, now I want it for all my Salesforce. And the IT guy goes, oh my God, I don't have that many people. So all of a sudden this bring your own device is what everybody's calling it this year. This BYOD movement has put enormous pressure on the CIO. Not in, not particularly in relation to Hadoop. This is more just around just pure infrastructure, wireless access, authentication, security, those kinds of things. But the next step up is going to be, look, you know, we need to make this more modern infrastructure and you know, we see what Amazon can do. We see what these guys are doing. If we don't get on the ship, we're going to get in trouble. One more question on that because, you know, the question the people are using when I was growing up into the business world around, you know, launching a product, getting to a market. But now with all the web apps on iTunes it's a rocket ship. There's no cash. This is an important thing. In fact we spent a bunch of time on this last few years. So crossing the chasm is a great B2B model. So for Hadoop it's perfect. It's going to march exactly like that. But if you look at the businesses that can spin up on the web, it's all about the tornado. It's like you either get a tornado going or you don't. It's horizontal from birth. And if you don't get a million users within X amount of time, it's like if you stay up. So we have a new model for that around what does it take to spin up a business on the web. But it's not about the chasm. Yeah, because exactly it's different dynamic. That's right. That's exactly right. So talk about from the perspective of an enterprise who maybe isn't an early adopter when it comes to big data, but you know, the IT group, some of the businesses, they're getting pressure from the business from the top. The CEO hears about Hadoop, doesn't know what it is, but you know, hears about some of the high profile use cases and wants to be one of those early adopters in an enterprise that maybe traditionally is not an early adopter type company. How do you make that transition? How do you kind of change the culture so that you can adopt a new technology like Hadoop? It's hard. In the early market it takes a visionary line of business executive. So if it's going to be the CEO, it could be the executive vice president, but it's somebody who's going to move a big chunk of budget from wherever it is today to sponsoring this new thing. And so you got to be fairly powerful to be able to move that kind of budget, right? And it's not the CIO. It's usually somebody else who's got budget that they give the CIO. So the CIO and that person are going to bond at the hip. If that person doesn't exist, I think it's a mistake to try to do an early market project. What you'll do instead is you'll do some pilots, you'll do some testing. What you're really trying to do is vaccinate your IT organization to give them experiences of this new irritant or this new whatever is for an object. But then where you will get on to what I think is the second step, the chasm crossing step, which is, okay, look, this is new technology. It's not really ready for prime time, but we have a major problem right now. Like the guy from CIRS was talking about, we can't solve the problem with existing infrastructure. So we're under enormous pressure. We've got to do something. Let's try Hadoop. And if you discover that there's a use case that is recurring, that everybody says, yeah, yeah, yeah, I have exactly the same problem. Hadoop? Really? Okay, I'll try it too. And that's when you get that first, because pragmatists love to do whatever they see anybody else do. And once they all start using it, it really does take off. Jeffrey, so I want to ask you about startups, because I live in Silicon Valley, I used to live in Palo Alto before you came on. I'm a venture partner of Moore-David Apple. So you're exposed to the inner circle of VC, which is now becoming open source a bit with Y Combinator. So two questions. What do you think of this whole Y Combinator, go to school, guaranteed check of $150,000 if we're getting accepted, basically a filter to startups that are in this environment, both, because there are big data people here that have a consumer feel. You mentioned Solconn, a big fan of Khan Academy. We have Silicon Academy going with our group. All this is going on. And there's a rapid start-up opportunity. So what's your advice to them? Comments on the Y Combinator dynamic. Okay. Is it democratization? Is it changing guard? I think the Y Combinator play is a function of the fact that there's this new non-Casim crossing model. You cannot get seed money to cross the cash. You can't get 1000 seed money. But you can potentially start one of these tornado machines. It's like shilling for oil, right? It is. You can start one of these tornado machines and get them going. And so the Y Combinator thing is saying, look, let's get the right people in the right place and the odds of any one of those initiatives being successful are low, but the odds that something successful will come out of it are pretty high. It's roulette. It means roulette. Start up roulette. But by the way, only here. So I go to lots of other cities around the world. Everybody has some incubation idea. It doesn't work any place else. Well, Harvard, iLab, maybe Boston, but honest to God, you go other places and it's something... The density of... It doesn't even work in this Bay Area if you're too far away from the episode. Even in the Bay Area. There's just something going on here. I don't know exactly how to describe all the magic, but it's a unique to this area. So that just is what it is, right? So anyway, that's the... So for the start-ups that are here, because it's a little bit across from the chasm and tornado combination, because big data affects media, you mentioned all the little verticals. Big data is chasm stuff. You have to do it at scale. So how does a start-up deal with this now? Is it classic? Again, it's a rapid funding environment. We're seeing seed funding for these guys now, the box, $3 million. Well, those guys are typically somebody like I was talking this morning with Rami Stata. Of course, Rami was at Yahoo from the beginning. He's got a new company starting. But you know, Excel, you know... What are those guys? They don't want to get into that. So if there's a kind of a set of people who have kind of been there, done that, we're going to attract capital at one level. Then there's going to be a bunch of people who say, well, nobody's ever heard of me, I have this idea. The Y Combinator path is a place to start. But at some point, you're going to say, look, I've got to get somebody else to buy in. That is a chasm to cross, too, right? Because venture capital is... You know, it's under a lot of pressure itself, right? And so getting funded is... It's a journey. And so sometimes you have to team up with people that have been there before and say, you know what, maybe this time I should ride shotgun and not necessarily ride a horse. I do think it's important to participate in the trend that you care about. Whether you're the leader or the follower, I think if I'm... My main advice to a young entrepreneur is get in the game somehow. Has social media and social networking obviously we're doing social TV here at the SiliconANGLE theCUBE, kind of our sports centers we call it. But everyone's connected now. You mentioned digitization, but you also have another dynamic and edge participant, an actor, a person with a smart phone and they're connected to everybody. So how does that change some of your research over the years and on your thinking going forward? Well, what it's done, I mean, it's changed the dynamic of markets particularly... Well, it's interesting. Obviously it changed consumer markets, media markets in particular. It's clearly changing political markets, particularly Arab Spring kind of stuff. I think it's changing the sports experience, the fan experience, a bunch of those kinds of things. I think there's going to come a point where it's like... Education? So education is, boy, I hope so. The problem with education and healthcare, both of whom could really use this dimension, is the institutions are so conservative and they're so politicized and they have so many different kind of constituencies which are a little bit at odds with each other. It's hard for this... Yeah, I was talking to an entrepreneur who had a $20 billion earmark fund for people who digitized documents. We were talking with the folks at HP last week and the entrepreneur said to me, John, I love that idea, but I got to spend money to actually start digitizing documents before I can get the money. So he's got to spend 10 million to get a chance to get us over that money. That's not money. I think waiting for the government to fund you has not been part of the Silicon Valley playbook ever before. I don't think it should be now. There's some places where if you intersect with them, clean energy or clean tech or healthcare or whatever, great. But I would never go... I would never divert one step from my path to go get government money. We're here with Jeffrey Moore, a famous author of many books. The famous ones are Crossing the Chasm, Inside the Fault Line, a bunch of other books, Management Consultant, VC Partner, Ed Moore, David Howe. Comments on something magical about Apple Computer because Apple has gone a complete turnaround so obviously it's well documented. But you've been in the valley. You've seen many magical acts before. Intel, we've seen ecosystems and just industries being born. Mobility, Nokia, all these guys with the leaders, and all of a sudden Apple comes out of nowhere, the iPhone in 2007 changed everything. Talk about the Apple effect on everybody. It actually started with the iPod before the iPhone and then the iPad afterwards. So what happened was Steve comes back in Apple in 1997, the company's on its back. Arguably it has no earnings engine. I mean, the max kind of doing a slow dive. And I think he had the perception, I'm going to turn this into a consumer electronics company. I think that was an intent. There were no consumer electronics of companies of his style at all. Maybe Sony. No, not maybe. In fact, Sony was. The vio, yeah. Sony was. That's actually true. But more importantly, before that, the Walkman. Think about iPod Walkman, right? Solid-state memory, by the way, in the iPad. So Steve did the thing he was able to do three times was design something where essentially he was the speck and he would create these things that were just so elegant and so amazing. But not alone, that's just a hits business, right? If that's all you do, the next hit comes along. What he did there with the iPod though, because he had had Pixar, he was at Disney. Because Disney bought Pixar. Because he was at Disney, he had access to the four music publishing labels that mattered. He got all four backlists into iTunes to get onto the thing. Well, how did he do that? Remember, there was Napster. So the idea was, you know, the last thing these guys wanted to do was actually be 99 cent songs on the iPod. But that was better than being free on Napster. And they thought, well, you know, how much harm can it do? Well, okay, it completely re-engineered the world. So now all of a sudden you have this Apple who has this amazing earning engine with phenomenal margins with this iTunes back in. Now, remember at that point, Motorola said, well, let's put iPod on the phone. So there's going to be something called Rocker, which was a phone with iPod on it. So Steve takes that and he says, no, I'm going to make the iPhone. Now he does it again. He creates a device that is so alluring that for the first time, the carrier industry has to come to Cupertino. The way the music industry had to come to Cupertino. That never happened before. The device guys always went to the carrier industry. So all of a sudden he's got this incredible power. So that's number two. And then he takes the iPad as number three. So basically in the space of a decade, he went from no earnings engines to arguably four mega earnings engines. Each one of those things is kind of a business itself. And there's kind of some positive synergy among them. So yeah, I mean stock price went up 5,000%. And so given that, so the final question is we're getting the hook here. Yeah, yeah, yeah, yeah, yeah. Talk about that context. That truly is a magical time in history and always be remembered and RIP for Steve. But for this new generation of big data guys, how do they take that lesson? What can they do with that? I'm not sure that Steve's the right lesson there. I think the lesson me with the big data guys is look, this is a sea change from a world where digital was a record keeper to digital is the world. And in that context, you need to wire an entire nervous system. So the internet was like the spinal column. Now we're trying to get the nerves all the way out to the fingers. That's big data and analytics. It's so fundamental. So it's an infrastructure problem. It's not going to be an overnight success. But it's an inevitability. And then the question is, can you be part of this? Can you be part of the nervous system? Because there'll be a bunch of people that mutate and die. Can you be one of the ones that's like in there at the end? If you are, you'll be an Oracle or a Microsoft or an Intel. Final comment about people that are incumbents in these markets. You mentioned the government, we don't talk about that, but like the leaders, the incumbent players are going to be threatened. What's your advice to those guys? Well, those guys, the classic thing that we ask of incumbents always is look, you don't have to innovate. We're already married for God's sake, right? You don't have to date me anymore. But here's what you do after you have to adapt. And so I ran into Mike Kohler. Terror data, right? Okay. Terror data could do one of two things. They could have said we're structured data, Hadoop's bad, terrible, fud, stay with us, stay with us, stay with us. Or you can reach out and embrace. And I think the good ones, and the problem is, by the way, it's not that people are stupid. There's a lot of money in old business models that you get worried about losing if you embrace the new one too early. But on the other hand, if you don't embrace the new one, at some point your customers say you really are irrelevant. So it's a dance. I think the world says... To an art and a science, too. It is. But I think the world's kind of patient. They say, look, if you show reasonable good faith and make reasonable progress, we'll put up with the fact that you're walking not running. Jeffrey Moore crushing the Kazim inside the tornado, living in the fault line, VCs from Silicon Valley. Great commentary. We're here inside the Cube. We'll be right back with our next guest right at this short break.