 Here at VMworld 2012, I'm John Furrier, the founder of SiliconANGLE.com, and I'm joined by co-host Dave Vellante, the founder of wikibon.org, the premier and number one market research firm that offers free content on all surveys, and obviously SiliconANGLE's free banner, banner advertising free, and I'm joined with Rick Jackson, CMO of VMware, you put on the show. Welcome to theCUBE again. Oh, thank you, third year. So first, thank you for having SiliconANGLE for the third year. We really appreciate your hospitality and gesture with a great stage here. It gets bigger every year. It was one tweet, the cube gets bigger every year and I want to thank you for that and say thanks. So welcome back. So quick update, just run the numbers on VMworld. The keynote here talked about the growth of obviously the marketplace, but they was talking about some stats. Talk about the whole concept of VMworld. What's changed from this year, last year? Sure, you bet. You know, it just amazes us every year is that VMworld just really becomes that place where so many different disciplines come together to talk about what's going on in technology and the data center. So you've got the server admins, the storage admins, the network admins, everybody's coming together and talking about what does it mean to operate in this new era where it's not about the silos and the separate disciplines, but how does it all come together to serve the business? And I think that's why we just continue to see such strong growth in the show itself, is because the topics are starting to blend and so you're bringing more of an audience towards that. So we're at over 20,000 as of early this morning and I'm sure it'll continue to grow throughout the week. You still have your voice, so it's early in the show. I know you're gonna be doing a lot of glad handing and PR appearances all through all the parties and there's a whole night activities. I mean, VMworld is a huge, huge community. It's great, it's vibrant, but I wanna ask you about something a little bit more serious. That's Palmer Ritz, obviously on Twitter called The King, really well-regarded in the tech community. He has yet to be on theCUBE, so we have to get him on theCUBE somehow, Paul, if you're watching, come on theCUBE. But he's really well-regarded in the technical circles. Obviously, he's handing over the reins to Pat Gelsinger, who knows a thing or two. He's gonna move on to a more of a corp dev, biz dev with Chotuchi at EMC and really get down and dirty and kind of getting ready to paint the next canvas, if you will. So what's it like for you? You got to kind of, you got to put the story together, keep the story going, build on the massive growth. So as a marketing executive, you get the tiger by the tail on one end, the market's exploding. Same time, VMware is changing. What's your, how do you handle that and what's your vision? Yeah, well, I think it's a natural evolution of the company. If you think back four years when Paul was brought in, the role that Paul played was really to take a look at what the company had done in the first decade around virtualization and where can you go with that? And there's just no doubt in my mind that Paul is one of the great technology minds of our era and just understands technology, what you could do with technology and strategy around technology like nobody else. And he really put us on a path for just accelerated growth. Now we're, as we were evolving, when he took over the company, we were less than two billion in revenue. We're a much bigger company than that. Now you've got all the operational aspects that need to come into play as well and really think about every single gear in the system has got to be running at full speed. Take a guy like Pat Gelsinger who's got an incredible technology background. So he understands and appreciates the technology the way Paul did, but who also spent over 30 years at Intel running a pretty major part of Intel with the x86 product line and all. So he gets the whole operational picture of what needs to happen and all the things that need to come together. So it's the natural evolution of our growth. You know, I've been a big proponent of at the CEO level, this modern era as we're calling it, CEOs really need to have technical chops. And you're seeing that in the startup landscape, the disruption in venture capital, for example, Andreessen Horowitz here in Silicon Valley is dominant because Mark Andreessen and Ben Horowitz are tech geeks running a huge fund and this AlphaGeek mentality even goes to the top. So I think one, that's a good call for you guys. The other question I want to ask you is relative to the other big companies the incumbents, the IBMs, the HPs, and I know you're partnering with them, but they're bigger and a little bit slower. You guys are still growing, still nimble. Paul talks about abstract pool and automate, which is code words for operating system. And he's laid out that chart in 2010 that we were commenting even back then that it smells like wind tail of the future. It's an operating system. You guys are kind of building this operating system that now has cloud, a big part of that multiple cloud future of the data center. So talk about that, relative to VMware, specifically how flash and solid state has changed. I saw you talking with Scott with Pure Storage. Good friend. It's guys like Scott's company and others that are just changing the game. Yeah, absolutely. Well, it's no secret that Paul has often referred to what we do as the cloud operating system, the virtual data center operating system. Software mainframe. I hate that word. We've successfully killed that term. All terms that he's very comfortable with and we try and kind of keep them somewhat boxed. But the reality is that what we're able to do, and especially with our vision of the software defined data center is to be able to take standard x86 based hardware and really begin to throw any challenge at it. And that's the whole notion of automate pool, or excuse me, abstract pool, automate, is we want to get all of the complex technology at a point where it can be delivered dynamically as a service so that any and all workloads can take advantage of it when they need to. When you introduce new technologies like flash and how much flash we're seeing moving into the storage world and how quickly, we want to be able to take advantage of that capability. But if everything is hardwired down to the physical storage devices, then it's going to take so much more work and effort to be able to implement and integrate new technologies into the data center. This is one of the value propositions of the software defined data center. Everything is running at an abstracted layer, everything. Everything is a service in the data center so we can implement new technologies underneath, new physical hardware, and get immediate benefit from that through the software. He talks about that hard and top or under the hood like a car, right? The dashboard is what you really want. We were showing you a quick preview of our VDP finder, kind of vertical engine, social data, earlier before you came on. But it's things like real-time dashboards that businesses are going to be running on and obviously we're a big believer that instrumentation of that is key for businesses, you guys are enabling that. How has the real-time effort changed some of your thinking? We saw SAP announcing that heavily with mobile. Having a Nexus or iPad is really changing the end user experience. Talk about how you guys are attacking because your end user computing message is constantly morphing with the marketplace. Right, right, and we're just, we're trying to usher in that post-PC era and make it so that it's easy for everybody and anybody to access apps, data, whatever it is, whatever you need from any device. But I think if you look at what the business demands, what end users demand, and the underlying infrastructure technology, it all grows together, right? As more and more demands come up, we create new ways of delivering technology and services to support that demand. And that equation has never stopped. I'll never forget, a good friend of mine once said that, we always thought that we'd run out of need for memory on our laptops. At some point, how much do you really need? Two gigabytes, four gigabytes of memory on a laptop. Well, every time you add more memory, you find new applications that take up more memory, new ways of using compute power. And that's what's happening in the data center. You talk about big data. We've had these ideas of big data for a long time in marketing. By the way, marketing is still one of the heaviest users of big data in the industry, because that's how we think. We think about large volumes of data and interactions, behavior, market intelligence, et cetera, market intelligence. Our problem has always been that to be able to do that in a traditional physical or client server world, you had to go procure so much hardware just to be able to start a project that no one would sign the budget. But one of the things we showed this morning in the keynote with Steve Herrod is, what if we could take all the unused compute at night and turn it into one big server farm to do my analysis data for me? So when I come in the next morning, I have all kinds of market intelligence right at my fingertips. Well, it's one, getting the budget approved, one. And then one you build, you got to get a schema, it's a data warehouse, and then it takes weeks to get the report. By that time, the business is changed. It's changed. You see the messaging around Hadoop. Another potential silo, you guys are trying to get your arms around that and make sure it doesn't get too out of control. Talk about that a little bit. I mean, Pat talked about this museum of legacy infrastructure, and then now, all of a sudden, you have this freight train called Big Data coming at you. And as Steve said this morning, a lot of people didn't initially think of virtualization and Big Data as going hand in hand. It's exactly. It's the natural decision making that we've gone through for decades as new application type that requires a new stack. And so we go off and we start piloting a new vertical silo that gets plugged into the data center. Now I've got more complexity, more silos to manage. We don't need to do that anymore. We have reached a point where we no longer need to create new silos for new application types. The advances that we've had in x86 hardware, the advances we've had in the virtualization space, both between VMware and the ecosystem of partners that are extending the technology with their technology, we don't need separate platforms for every app. So one of the virtues of the Software Defined Data Center is that it's homogenous. It's a single environment. It's what powers Google to be able to do what Google does because if you go to Google, you don't see the museum of historical IT decisions silo by silo. You go to a Google data center and it's all the same. It's just a sea of x86 boxes that are dynamically configured based on their own proprietary technology that they've developed and their own distributed operating system, so to speak. What we're trying to do is bring that same capability to every business to have that luxury. So homogeneity is definitely an advantage that the Googles and Amazons of the world have. And I think you guys have noticed that. You've observed that. And now you're marching down that path. We heard today we're 25% in 2008 virtualized applications, 60% today. The goal, the gauntlet that Gelsinger threw down was let's get to 90%. I'm reminded Rick of a mountain climber. He or she's at the, they can see the top. This is the really hard part. It's called a false summit. Yeah, the false summit. But you're motivated, right? Now you have more resources. So the homogeneity of you and your ecosystem, but you've got other virtualized systems out there as well that are starting to gain ground. So this is what makes it challenging for you guys. So how do you get to that final summit and keep it all at that 80% VMware? Well, first off, I believe the industry will move towards 90% plus virtualized. It's inevitable because there is nothing holding us back. VMware or otherwise, so we as an industry will move in that direction. Now, how does VMware continue to maintain such a strong market share? Well, that's the challenge that we have to continue to innovate every single year to put out the kind of capability and the technology that matches to the vision that we're portraying with the software-defined data. The cadence that Pat Gelsinger talked about. Take talk. So I'm late knows that cadence well from the cadence of Moore's Law. That's right. I mean, I'll see you guys making some great moves on the street here in the tech industry. And this year, a billion dollar acquisition that lays the groundwork for the software-defined data center, which we believe is part of this modern era with Hadoop. You're seeing modern era and a lot different than Linux. So new capabilities doesn't mean it's the direct replica. So we always talk about that as well on our blog. But one area that we're really following deeply right now, Rick, I want to just touch on as a point, maybe get your comment on if you can, is low-level virtual machines. And this really talks to some of the work in the computer science area, where at the program level, virtualization has yet to tap into these large data centers on the metal, bare metal commodity gear, like Google's and these guys who were running this. So having the ability to run these low-level virtual machines with the programs, not just the products, is a big trend in the University of Illinois doing some cutting edge work in the area. But this brings up the developer community, right? You guys had acquired Spring two years ago. The developer community's evolving really, really fast. You're making moves. Just join OpenStack. How do you keep up with the developer focus? And what is that focus for you guys? Are you enabling, with this abstraction, you're reducing the complexity, so you're enabling infrastructure. Can you talk about that? Because that's something that people want to know about is, I'm a developer. I see vCloud, Cloud Foundry, a lot of stuff's out there. What's the core message to the developer community? Well, our belief for the developer is that developers should focus on application-level business logic. The business depends on applications. The business has demands, and they want a process and an environment where the developers are responding to the business demand, not tweaking and tooling with the plumbing underneath. So our role is to create that open platform for development, and Cloud Foundry is a great example of developer gets to choose the language and framework that they want, choose the set of services that are enabled through the cloud that they need for their application, and choose where they want to deploy it, whether that's on VMware infrastructure or not, but it helps the developer focus on what is the business need of this application. It's our role as a company and as an infrastructure vendor to make sure that those applications are highly reliable, they can be operated extremely efficiently, and that they're easy to configure, deploy, and manage over time. So we want developers to focus on business value, and as Paul is famous for saying, it's our job to make the plumbing disappear. That's our role. I think there was a quote on the Mercury News in San Jose, Chris wrote a story called about Twitter and how Groupon, outside of LinkedIn, everyone in the social stocks is plummeting or down, and he called it the summer of social media discontent. Really talking about really that hype cycle where the emphasis, and this is something that we're talking about, and I want to drill down on, is this business value conversation, because we're seeing an upswing on business value, not so much a bubble bursting, just that new anti-hype at more, hey, there's real business problems to be solved. Can you talk about use cases that you're seeing, if you can get a little bit more color to that business value conversation? Is it software as a service? Is it platform as a service? Once specifically, can you tell developers who those use cases are? Sure. I think there's a lot of different examples out there. Certainly, platform as a service empowers a whole new set of developers that previously had tools and infrastructure dictated to them. With the move towards platform as a service, they have the opportunity to go choose what platform, or again, what language or framework they want to use so that they can more rapidly develop an application that's based on, or that is a good fit for a particular language or what have you. So, mobile is a great example of that. If we had to wait for the traditional client-server world to deliver all of our mobile apps, the app store would be non-interesting, I'd say the least. So, we're empowering new types of application development. But I think in terms of business value, again, it goes to every time we break down barriers, even as low as the infrastructure level, it creates new opportunities for businesses in how they operate. One of my favorite examples is NICY Euronext, who built the first public financial cloud based on the VMware technology. And the notion is simply that today, previously, the largest brokerage houses had actual servers on the floor, on the trading floor at NICY Euronext. So, they could pay millions of dollars to put their servers right there on the floor because the difference between four nanoseconds in a trade means profit or loss, right? So, only a few of the elite could do that. So, what did NICY Euronext do? They reinvented their business model. They built a public cloud on their trading floor built on VMware technology that allows now other people to be able to host trading applications right there on the floor using a shared infrastructure close to the trading app. That's changing the dynamics of how trading is working and really opening up the envelope to a much broader array of business. So, if you're interested in this story, at 340 today, we have Feargal O'Sullivan coming on, who has had a global business dev or global partnerships for NICY Euronext. Fantastic, yeah, it's a great story. Yeah, it's one of my favorites. All right, good. Okay, it looks like we're out of time here, John. Well, I have one more question to end it. Next year, we ask you this every year, what's your agenda for the next 12 months to next VMworld in terms of your charter for the year? What's your outlook and what are you looking to nail down with VMware and the marketing and the overall leadership? I think that we set the next 12 months fairly clear as the challenge is we've got 400,000 customers who have done an incredible amount with virtualization technology. They've put in place the foundation for that software-defined data center. Our challenge now is to work with them to accelerate that path, find that fast lane, if you will, to cloud computing and really optimizing all their previous investments, but getting even further value out of a complete cloud computing environment that creates even more efficiency, especially around operating costs. And VMworld next year at Moscone again, right? VMworld at Moscone. Yep, bought it out for a decade. I think we did something like that. Good joy. Okay, we are here inside theCUBE. The future is about abstracting away the complexities, making it easier, new use cases, re-engineering the business models, all using technology. VMworld's building the new stack. Rick Jackson, CMO of VMworld. Thanks for coming theCUBE. We'll be right back with our next guest after this break.