 Hey, welcome back everybody. Jeff Frick here with theCUBE. We're at Zora Subscribed in downtown San Francisco and every time we go out to conferences, there's a pretty high probability we're going to run into this CUBE alumni. And sure enough, here he is, Wei Wong. He's the founder and principal as Constellation Research. Ray, always great to see you. Hey Jeff, this is awesome. Thanks for having me. And close to your hometown, what a thrill. This is, it's a local conference. You know, what else can I ask for? So what do you think, subscription economy? These guys have been at it for a while. 1,200 people here. You know, I'm a big Spotify fan, Amazon Prime. Go back to Costco if you want to go back that far. But it seems to really be taken off. It is, you know, about three years ago what happened was digital transformation became a hot topic. And because it became a hot topic, it's really about how do we get products to be more like services? How do we get services to get into insights? And how do you make insights more like experiences and outcomes? And that natural transition as companies make a shift in business models is what's driving and fueling the subscription economy. It's interesting. I think they had to put the two and two together that once the products become services, now you can tap into that service, you can pull all kinds of data after that thing, you can have analytics, as opposed to shipping that product out the door it goes, and maybe you see it every 15,000 miles for a checkup. You know what it is? It's basically about three years ago people started to realize this. You know, Tim's been talking about this for ages, right? He's been talking about everything's a subscription economy, everything's going to be satisfied, you know? And in tech world, everybody got that. Right, right. But it was when companies like GE, which we saw together, or Caterpillar, or Ford, started to realize that, hey, we can do remote monitoring and sensing with IoT on our cars, and I can now figure out what's going on and monitor them, or I can get an upgrade, or give a company an upgrade on their appliance, or give an upgrade on their vehicle, or do safety and compliance, then people start realizing, oh wow, we're not just selling products, we're in the services business. Right, it's funny if you read the Elon Musk book, how the model years of Tesla, there's no such thing as a model year. It's what firmware version are you on in the upgrade? Oh no, no, that's what we do all the time. You click on a little T, and it's like boom, firmware. That's like oh, I got an upgrade. Like only the other day, the other day I like, you touch your like, you know, your head seat, your as like a lumbar support thing, the software popped up for head rest. I never knew I could change the head rest. It literally showed up like two months ago. Right. It's unbelievable. So the cool thing I think that doesn't get enough play is the difference in the relationship when now you have a subscription based relationship. That's a monthly recurring or annual recurring. You got to keep delivering value. You got to keep surprising you every morning when you come out and get in your car as opposed to that one time purchase. Adios, we'll see you in however many years till you get your next vehicle. Oh, it's a great example. In the Tesla, we got the Easter eggs over Christmas. Right. So the Christmas holiday thing with the Model X that actually did like Trans-Cyberan Express like two like, you know, Bellagio fountains with the doors. Right. I mean, that's popped up. You're like, hey, what is this thing? It's just an upgrade that shows up. You're like, okay. But you do, you do have to delight customers. You're always capturing their attention. And the fact is, hey, I might buy a toaster. And in that toaster, I might get an upgrade like two to three years out. Or maybe I just buy toasters and I subscribe to them. And every three years I get a new toaster, right? And I can choose between a model level or I can go upsell, get a different color, or I can change out a different set of features. But we're starting to see that. Or maybe I get a hotel room or a vacation. And that vacation is at level X. And if I get a couple more members of my family, I get to level Z and I get to another level where I lose all the kids that go back to level A. But the point being is I'm buying a subscription to having an awesome vacation. And that's the type of things that we're talking about here. It's that freedom that Keen was talking about. Because he talked about the freedom from obsolescence, freedom from maintenance. There's a whole bunch of benefits that aren't necessarily surfaced when you consume stuff as a service versus consuming it as a product. It does. And sometimes it may cost more, but it's you're trading the convenience, you're trading the velocity of innovation, right? For some people, they just want to own the same thing, they're not going to make the move. But for other people, it's about getting the newest thing, getting delighted, having a new feature. And in some cases, it's about safety, right? This is regulatory compliant or I'm actually doing RevRet correctly as they were talking about ASC 6-6. All right, so you've been out on the road a lot. You are, it's June 6th and I won't tell anyone on there how many miles you already have because Tamara's probably watching, she'll be jealous. But biggest surprises you've seen here or recently as this digital transformation just continues to gain speed. And you know, I'm doing a little research now. Maybe you can help me out. Looking back at digital photography because, you know, it's like, no, no, no, no, no, for the film and then boom. You know, I think these really steep inflection points are up I guess if you're on the right side. That's coming. A stick digital photography, that's a great one. There was the point remember where we actually had all those disposable cameras at parties that get developed, one hour developing. Then we got to the point where you just showed up at Costco, dropped something off, you got the disc and the photos. And now, and then we had Ophoto and then we had nothing. Everything just went away because of the phones. These things changed everything, right? I mean, they changed the way we look at photography to the point where do we even have an album? I was breaking out albums, like basically three weeks ago showing my kids like, hey, this is what a photo album looked like and they were completely mystified, right? Oh, you print these. How do they get printed? Like, you know what? They're asking them the basic questions. That transformation is what we're having right now. It's like you own a car, you actually buy a PC. I mean, it's like I'm buying compute power, kilowatts per hour for artificial intelligence in the next year. It's not going to be, I bought the server, I loaded it up, I got it tuned, it got it ready. So, yeah, we are in the middle of that shift, but it's the fact that companies are willing to change their business models and they're willing to break free in the post-ERP era. A lot of this is basically, you know, my old ERP does not do billing. It doesn't understand the smallest unit of something I sell and I've got to fix that. And more importantly, my customers, they want to buy it today. They want to buy it in pieces. They want to buy it in even smaller pieces. They might buy it every other week. They might buy it, we have no idea. I've got to make sure I can do that. Right. It's just interesting too that it's happening now. People don't, we talk about autonomous cars. You know, we see the Waymo cars all the time. The guy from Caterpillar, he's got a whole autonomous fleet of mining vehicles that are operating today. This is fine. 500,000, he's got 500,000 little trucks. Like, they're not little trucks. They can't fit in this building. They're big trucks. They're big trucks, apparently they try. But they're trying to get these trucks in. I mean, we used to think about like, you know, hey, these are agricultural vehicles that can be remotely controlled by GPS. They also work for tanks. All right, these are like things that are actually doing runs. Now, it's a great reason. Like, take Australia out in Perth. It's about $150,000 to hire a driver. Just go back and forth, right? And so they figured like, this is getting ridiculous. We don't have enough people out here. We can't convince enough people to come drive these trucks. Let's go automate that. That's a lot of the story of where a lot of this came from. Or you had a bad night or broken by this girlfriend or distracted about this or that. I mean, the whole autonomous vehicles versus regular people driver. All you got to do is ride around your bicycle in the neighborhood and watch how many people stop to stop signs. Do we answer that question? Oh, yeah, I don't know. Do that in California. That's kind of bad, actually. All right, well, thanks for taking a few minutes. I'm glad to get a weekend at home. Hopefully you're not, well, where are you off to next? I should ask. Oh, it's going to be a crazy next few weeks. I'm going to be in London and Paris and Boston all next week, so. Well, you're going to eat well. I'll try. All right, he's very long. I'm Jeff Frick. You're watching theCUBE from Zora Subscribe. Thanks for watching.