 Okay we're back, this is Dave Vellante, I'm from Wikibon and this is theCUBE, Silicon Angles production of Reinvent 2013, we're here, this is Amazon's big show, this is the Super Bowl of Cloud, we're here in Las Vegas, Mauricio Fernandez is here, he is the president of Daedalus which is a Brazilian consultancy, welcome to theCUBE, thanks for coming on. Thank you, thank you. Brazil is a vibrant market, been to Brazil, it's a very IT savvy market, obviously a lot of banks, it's the biggest market in South America, so quite advanced, first of all talk about Daedalus, the firm and what do you guys do and I want to get into the Brazilian market and obviously the cloud. Okay, well thank you for inviting me to be here, Daedalus is a traditional company in Brazil, we started in 1989, 24 years ago, so we are very well known in Brazil, we did a lot of things, for instance in the past we had a local data center with 2,000 servers and then we gave up because it's impossible to have a data center with such volume today, then we realized that cloud computing is the future and we started a partnership with Amazon and we grew up a lot and today we are one of the major partners of AWS in the world, in Latin America the number one also. So 1989, in fact I was just talking to somebody and I said, you know, this reminds me of the early 1990s, this being the whole migration of applications to the cloud, you remember I'm sure the downsizing trend, right, a lot of mainframes in Brazil and then almost overnight from 1991 to let's say the late 90s, all the apps went off the mainframe to client server. You're seeing a similar migration to the cloud, do you buy that analogy, are there similarities that we can draw on and learn from? Yes, it's similar but cloud computing has something that is very different, it's not only for the IT, so the CIO, the guys from IT, they realize that they are in a shift that will provide to them the opportunity and the risk of helping the entire company. They are not changing a big server for a small server, they are eliminating the server and they are doing something that is not only IT but it's internet in general. So they have to deal with the guys from marketing services, sales, etc, etc, it's a new world for them. So you're right, back then, even though I could argue that a lot of the client server was enabled by the client and that was sort of non-IT, but it was about personal productivity. It wasn't about organizational productivity which is what the cloud is about, it's like Andy Jassy says, the question you should be asking is how can you make your company more productive, how can you serve your customers better? That's not a question we asked back in the IT. Yeah and that's a big problem because all of us from IT, we are not prepared for those questions. So the fear is huge in general. When you go to a CIO of a big company, which is the target that we have, we see a lot of fears because those guys, they have been trained to discuss only IT and now all of a sudden they have to solve problems about sales, presentations, internet in general, etc. It's not easy. And our work at Daedalus is to help those guys to jump from the old systems to the new systems. And we are trying to do this all the time. So Mariso, if I had a draw bell curve, speaking about your local market, and maybe slice it into three, those CIOs that really get it in embracing the cloud, they see the future and they say, we want to be a part of this, those that are fearful but realize something's coming and those that are digging their heels in, say no way, cloud. How would you say that pie or that bell curve breaks up? What rough percentages do you see? That's a great question. This is changing all the time. The market in Brazil, I think it's the same here in the United States, but in Brazil this is changing in a fast speed. What is moving then to the cloud is dropping costs, agility, and best services. So there is a moment that you no longer are discussing, well, should I go or not? Should I decide? Well, you have a very emergency situation, a critical situation. So I used to say that Daedalus is like an emergency room where the guys go and say, well, I am with pains and I have to go now. So this is happening all the time. We discussed with customers for one year, two years, and all of a sudden they have a pain and they have to move in the same moment. So that's very interesting. In the past, when you said about the mainframes, it was a process for a long time, one year, two years, three years. Now it's weeks, okay? And those guys, they changed a lot. Of course, Brazil, we have a lot of, let's say, more old-fashioned people that say that, let's say, well, cloud is not for me. We are not prepared. But then all of a sudden they have a situation that they have to move. It's incredible seeing this. And we help those guys to understand that, well, it's okay. We've seen this before. We are doing this all the time so we can help you as well. When did you realize that AWS is announced in 2006? How long after did you realize this was the future and something that you were going to sort of bet your business on? 2009. Okay. And I will tell you what I did. I gave up everything that I was doing, all the types of services, and embraced the idea of AWS totally. Totally. Yeah, wow. So I say, well, I don't want this. I will not start with the small people thinking about cloud computing. I will focus my company totally to cloud computing. And this is one of the devices that I say. This is not for a hobby, okay? Cloud computing has to go deeper to understand that. So since 2009, we created a new company totally on cloud computing. So today we are working with AWS and Google also for the Google apps. And our projects, they are totally devoted to cloud computing. That's the key of success. We haven't talked much about it at this show, but I would observe that your timing is impeccable because I would say, okay, 2006 to 2009, it was basically tinkerers, you know, it was developers playing around with AWS. 2008 when the economy crashed in the fall of 2008 and 2009, and we've been saying this, and I heard Andy Jassy say it at a meeting I had with him recently, that economic downturn accelerated the move to cloud in our client base by at least 24 months. Everybody said we have to shift to a variable expense. Don't spend money on servers. And then coming out of the downturn, things are actually pretty good from a spending standpoint, but you saw a lot of shadow IT, what we call shadow IT, marketing departments, research departments, doing it on their own. And now, our premise is that in 2014, we're going to be entering the phase of CIOs embracing this. Now, based on what you said earlier, maybe not so much, maybe CIOs but what do you think about that? Did you see that huge spike in interest as the economy turned down? Your business started to explode? Is that what happened? Exactly, that's the idea. I mean, when you are in a crisis like 2009 or today, a company will look for reducing costs and agility. That's why we are here. I mean, cloud computing is the same. I mean, agility is an incredible agility compared with what we had 10 years ago and reduce the costs. So we are speaking the proper word for those guys. So 2013, 2014, we will envision a huge acceleration on cloud computing because all the fears, you know, you have fears when you don't have the CEO of the company saying, well, I have to reduce your budget for 30%, 40% because we are in a bad situation. I have to, you to help the shadow, the degree IT departments on marketing, et cetera, because we have to be more agile. We have to recreate our company as well. So I believe that the next two or three years will be very, will be the golden age for the enterprise cloud computing. And then, again, in your timing, you had the Google effect in 2009. I know we as a company moved to Google Apps, Google Email. We were a Microsoft shop. We moved to Google Apps around that time, largely because Microsoft 360 wasn't ready at the time. But it is now. So what are you seeing there in the marketplace? Microsoft's coming on a lot stronger in the apps. What are you seeing in your customers? Too late, in my opinion. A little too late, yeah? You know, we are living in a moment that months are like years in the past, right? So Google is doing that since 2007. AWS since 2006. So despite of the fact that Microsoft, of course, is the big company, but I don't think they have the focus. I don't think they have the proper timing to compete with AWS or Google as well. No, sorry. So AWS, multiple data centers in Brazil, correct? Yeah. So in Brazil, it just passed some laws recently requiring that for certain industries, I didn't read the law, but I've heard about it secondhand. Certain industries will require data must be stored in Brazil. Is that right? Maybe you could add some color to that. Yeah, that's correct. Well, it's not available the law. They are voting for the law on the Senate, but probably that will be the shape. I mean, the data should be in Brazil, okay? What doesn't have a huge impact for AWS because they invested to have some data centers in Brazil? Yeah, so what was the impetus for that law? I mean, it's probably predated the whole NSA prism issue, right? You know, the National Security Agency. But are your clients sensitized to that? That potentially the United States government could be looking at their data? Or any government for that matter? All the time when they ask me that, I say that, let's say, the more mature people understand the situation and know that this is not a technology situation, it's a diplomatic situation, okay? And they understand that they have to encrypt their data, they have to concern more about security. But they understand that cloud computing is the best way to place your data. They are insecure inside your house. So probably if you use AWS, we train the micro for instance, you'll be much more secure despite of any patriotic act or any other law than having the data on your home. You believe cloud is more secure than on premise. Now, a lot of banks in Brazil, a lot of financial institutions, I guarantee some IT practitioner inside those financial institutions would say, no way. What would you say to that? Well, you know, it's changing. We have been talking with some CIOs from Brazilian bankings and they are saying this, well, banking, okay, we will keep in house. But everything that is internet, the best place to have internet is on the internet. It's so obvious, right? But they realize that there are two words, the internet word, which should be at cloud computing and the banking word, it's not that big actually. There is a lot of activities on the internet layer of for a banking that should be at home for now, but maybe in two years, three years. We don't know. We saw some cases here at re-invent of banking in Japan, et cetera, moving entirely to AWS. So it's as a matter of time. So tell me about Daedalus. Tell me about the name, what's the name mean? It's from the mythology. I realized when I was 12 years old that I want to have a company and I decided that the name would be Daedalus for the mythology. It's the guy that created the labyrinth and the Icarus is the boy, is his son and they fly it from the labyrinth. It represents smart people, capacity, agility, survivors, et cetera, et cetera. Connectedness, so how many people are you? 90, 90 people. 93 people. 90, yeah. Awesome, that's great. More or less. So let me ask you, last question. There's advice for practitioners, particularly CIOs that are scared. What do you tell them? Well, first of all, cloud computing is a reality. I mean, we are not in a laboratory that are hundreds of thousands of examples. You don't have to create nothing. Everything that you should need, you will find at cloud computing, especially with AWS, which is the more mature provider. Second, jump. Don't waste your time thinking. This is not the time of thinking, this is time of action. So jump, that's the idea. I said last time, Ashley, one more. You're going to go back to Brazil and people are going to say, hey, how was re-invent? What are you going to tell them? What's the bumper sticker that you're going to put on the show? Re-invent, 2013, what's the short phrase that describes it? In one word, hey, create. I think that we are not only inventing, we are creating the entire platform of technology as it should be since the beginning. I mean, more close to the people and not close to the technology itself. So here we see people that is not, let's say, totally IT-oriented, they are more people-oriented, which is something that we expected to have on the 20th century and it's happening now. So he created, I think, is the proper word for re-invent. Mauricio Fernandez, thanks so much for coming on the queue. A great example of innovation going on outside of the United States. Huge opportunities for Amazon. It's a global market. It's a multi-trillion dollar marketplace. I really appreciate your time. Thank you. Thanks very much. All right, keep it right there, everybody. We'll be right back with John Furrier, my co-host, and our next guest, right after this. This is theCUBE, we're live from re-invent.