 from the Sands Convention Center, Las Vegas, Nevada. Extracting the signal from the noise. It's theCUBE, covering AWS re-invent 2015. Now your host, John Furrier. Okay everyone, we are live in Las Vegas. This is Silicon Angles theCUBE, our flagship program. We go out to the events and extract the signal from the noise. We are here for day three of coverage of Amazon Webster's eight of its re-invent and what an exciting event obviously. We get pumped for this. One, it's active show, it's highly active, but there's a slew of announcements. This is day two, the keynotes are here. The CTO for her vocals really goes down and lays out the technology, some of the big meat on the bone on the technology. And of course, announces the party, which will be great tonight. And we're here for the full day of full coverage on SiliconAngles.tv. My co-host this week, Stu Miniman, analyst at Wikibon.com for infrastructure chief analyst there and Brian Grayson, cloud analyst at Wikibon.com. Guys, the voices are getting hoarse. The exhibit hall has been packed nonstop. We've got Andy Jassy coming on theCUBE today at 1.30 for a special sit down, fireside chat, and just amazing set of activity. But the question is, what is the level of the Amazon dominance? And the horses on the track, as Dave Vellante would always say, is my favorite. Is it a three horse race? Google, Azure from Microsoft and Amazon. Clearly, thundering hard and leading on the cadence of Andy Jassy's law, which is introduce a boatload of new products. And how are the guys going to differentiate? So what are you guys hearing? What are some of the highlights? Yeah, so first of all, John, of course, one of the things is, those companies that you mentioned, they're not all playing the same game. Last year, one of the key statements we said is that, you know, is it infrastructure services and platform as a service? Oh, that discussion's passe. Cloud opinion on Twitter, who participates in our crowd chats, we've had to back and forth with, said that today, Amazon said that the IoT discussion, basically if you don't have a full platform, you know, you're out of this game. I mean, you know, Amazon did a good job really putting kind of end to end everything from all the partnerships on the sensors, companies working with Intel, Broadcom, lots of other people. Go to Amazon.com and buy some of these things through all the various software pieces and how it fits into the AWS platform. It really is the first time that IoT has really resonated with me. I love the statement that I heard in the analyst session that says, connectivity does not necessarily mean usefulness. And it's great that you've got billions of devices and trillions of messages, but if I can't do something, leverage it, use it. And Amazon's very thoughtful and really put out all the pieces here. And the big news here, obviously, SiliconANGLE Media theCUBE has exclusive first look footage at the IoT announcement, going in depth with the chief architect of the program, looking at the kit, how it works. But Brian, I want to get your take on this because we were commenting during the keynote, it's not a new thing. Internet of things and sensors have been around for a while and some of the commentary on Twitter was Amazon's playing catch up. But there's a little different nuance here. Connected devices, one thing, writing a software platform that can integrate all the goodness of, say, streaming, Lambda, Kinesis, kind of creating an abstraction layer for what DevOps has done for apps, for devices. So what's your take on that? Do you think they got it right? Do you think it's a good start? Middle of the fairway, haven't teed off, what's your take? Yeah, no, it's a great start. I mean, I think the simplest way to think about this is, yeah, there are already billions of devices out there. People have wearables, people have sensors. The biggest thing that they did today is they said, look, if you're a business that's going to be dependent on Internet of Things, it's going to make that a part of what you do. You're going to either make revenue out of it, it's going to drive better decisions. We have an entire platform for you. And I think they're really one of the very first, there's a couple of others, Azure made some announcements last week, but they laid out a really great story that says, here's how you deal with data, here's how you deal with network, here's how you deal with devices, here's how you're going to make it very simple to build applications on top. They laid out a really good vision and I think they laid out that vision explicitly for businesses that say, look, if you want to be John Deere, you want to be BMW, you want to be Nike, who's going to be connected devices, this is a great platform for you to build businesses on top of. Yeah, so Brian, Warner Vogels in his keynote, he really laid out a thesis on how to build distributed architectures. And I felt like he was almost taking a shot at many of the open source, various tools are out there, things that you've been covering. What's your take on how Amazon's doing things and what that means for the rest of the ecosystem? Well, you know, we've talked a lot. I mean, a lot of what they build is based on open source. Yeah, they've got a huge head start in terms, look, the biggest thing that's going on right now is there are companies who are learning from their experience and then there are people that are just building things. The ones that are learning from their experience, that learning curve is so valuable. You know, I don't know how you can quantify necessarily how much of an advantage Amazon has, but their learning curve is that flywheel. It just keeps growing and growing. And when you compare that to, you know, 50 companies trying to build an open stack, you can't even, I mean, it's apples and kumquats. It's not apples and apples or even apples and oranges. So guys, this is a big thing in my mind is the software life cycle of Internet of Things opens up a whole nother revenue. I mean, if you think about the opportunity Amazon could make dollar wise with IoT, just think government, public sector. I saw Teresa Carlson last night, she heads up all the public sector. I said to her, I go, this Internet of Things, if it plays out the way I thought it would play out as it did today, it's a gold mine. Just the intelligence group alone in the government is a fricking gold mine. Look at the machine, John Deere, obscure example farming, to greenhouse, to hand the sanitizer, so industrial from factories to cars. I mean, this is a boatload of cash. It's a good day to be a data scientist if you're a data scientist, because boy, it is, it's all data. It's all about streams of data. I mean, we talked about fire hose yesterday, we're talking about Kinesis streams, talking about Lambda. Yeah, you see these building blocks from two years ago, they talked about Lambda, and everybody went, oh, that's weird, it's not really even a computer, but it does super fast functions for one or two things. That's exactly what IoT needs from a computing perspective. Yeah, to me, I hundred percent agree with you. That point, you're right on the money. This is a boom for data science. If you are in the data business, you are high-fiving each other, and super, super pumped. Stu, under the hood though, there's a lot of technology that have to get their act together. So what do you think, what's your analysis of what needs to happen at the infrastructure level? Is it just, you know, spark, housing, and memory? But under the hood, converge. Is converge positioned for this, or does it matter? So it's interesting, if you look at where we think, really what we call server sand is, there's two pieces of it. There's what's going on in the hyperscale environment, which Amazon absolutely is doing. Fundamentally, I mean, you know, Amazon doesn't buy traditional storage arrays. They don't think about it that way. And one of the other announcements that they had today was really how they're taking containers and making that so much easier to use. The container registry was kind of the big announcement. CLI, a couple of other pieces. And making it much more, so, you know, we had the basic tools inside of Amazon, and now one of the lines I heard actually said is we're going to be actually take from microservices and go to nano-services using Lambda and some of the other pieces that Amazon. Guys, winners and losers, okay? Who wins here? Who loses? Obviously Amazon's winning. I think, you know, I'll start, the ecosystem in my mind is the winner. Amazon has always had a hard time of articulating what their ecosystem was, at least from my standpoint, covering for three years on site, looking at them over the years. They were always so busy beavering away like elves in the North Pole, some people commented on product evolution, that they kind of had this loosely defined ecosystem. They had some partners, but they never really had an ecosystem. So I think to me, the ecosystem is one, and then new applications, I think, are the winners there. Competitively vendors, I mean, I think, you know, if you're not Google or Azure, you've got to be scratching your head. Yeah, no, I mean, we had a number of what we think might be the winners on yesterday. I mean, we had New Relic, right? They're built to look just like Amazon, but to monitor applications. We had Evan and IO security around these fast applications. We've seen people like Datadog, we've seen, you know, companies that are SaaS companies, they're built to be on demand. They're built to do stuff in real time. Those companies have built their business on Amazon's business, and they're trying to mimic what they're doing. It's so different than what the vendors are doing. You know, right now you have to say that part of the ecosystem is probably going to end up being more successful than anybody, you know, trying to jump on as a legacy vendor. Let's do NetApp winning with this announcement. I mean, they're here. They've had a big investment in the AWS relationship. Other players we're seeing here, I mean, we see Cloudera, a small booth over there. You know, I think they're just recruiting, but I mean, people's strategies are going to be impacted by what Amazon's doing. Certainly, Azure's aware of it. They've been making their own moves. Google, they got their approach. We're going to try to understand their strategy more. Yeah, what's interesting to me, John, is we actually haven't talked a lot about a price this year. Last year it even went down a little bit, but if you take a company like NetApp and say, great, they're partnering with Amazon, they've got the direct connect. But even if that greatly increases their customer account, what does that mean for top line revenue? What does that mean for bottom line revenue? Amazon is significantly disrupting really the margin structure inside the industry. It's one of the reasons we were talking yesterday about why the Dell EMC merger, the infrastructure companies are going to have to change because the way they've done things over the last decade will not continue. So what's Wikibon's analysis of the EMC situation? Let's talk about that. I know it's not really relevant to this show, but there is a side effect consequence of what Amazon's doing with EMC. They bought VirtuaStream. Okay, they have some sort of cloud play out there. This is huge structural disruption to EMC. If Dell truly buys EMC, which I was poo pooing yesterday on theCUBE, I might have to eat my words. But still, what are we finding out? What is Wikibon learning and what's your analysis? Yeah, you know, first of all, we got some of the public data out there. CNBC did some real good reporting understanding that the banks are involved because there's a lot of money here. I mean, John, I worked at EMC for 10 years and EMC had a very long, very profitable relationship with Dell, but it ended many years ago. The companies have kind of gone different ways. And, you know, if they merge, I mean, the EMC that we have known will be greatly changed. And, you know. Is this one of those quotes from Wall Street, Blue Horseshoe loves blue star airlines? I mean, sell the hangers, get rid of the jets. I mean, is it truly an exercise of financial calisthenics to kind of keep it going? Or do you guys see this as a very serious deal? I think it absolutely is. If it comes to fruition and whatever formation it comes, I mean, it would be a huge deal. You're talking about one of the top three, four vendors in terms of infrastructure, throw off a lot of cash, tons of customer base. I mean, if, you know, as many customers are here, Amazon would kill for, you know, EMC's customer base. I mean, it's the Fortune 500, it's the Fortune 1000, it's all of those. It's going to have humongous impact. It's going to shake a lot of doors. If they put a mega merger together, they'd have to change the name. Not sure they want to keep Dell. I think they keep VMware, they keep EMC, they keep Dell as Michael Dell the CEO. Are they going to compete with Amazon? I mean, all of this is awesome conversation. So John, if it happens, it sounds like EMC becomes private. You know, we heard from Michael Dell very much so that he could stop trying to answer to Wall Street and EMC is going through a number of shifts. So you have the traditional, you know, Symmetrics and Clarion product line, Extreme IO and Iceland are growing. So if they could step back, not have to answer every quarter to Wall Street, they can accelerate some of those changes, make the structural changes inside that needs to be. They'd be a massive powerhouse in what the hyper-converged market between the two of those. I mean, I think Amazon's disrupting, that's our key message here, we're seeing it, data science, but what we're talking about with EMC is related to the whole conversation of the capital markets are changing. I mean, being private company at that magnitude would be, that means there's no stockholders. That means the employees are the stockholders. And or the private equity, someone has to get liquid. So I mean, someone has to make money. But we got to remember, private doesn't last forever, right? At some point, private means you shed things off, you go prepare yourself for what that new offering looks like because the equity guys don't want to hold on to it forever. There's no return for them in that space. Oh, it depends on the cash flow. The lifestyle business could move to that level. I mean, Dell going private with EMC and VMware would be a lifestyle business for the private equity company. But let's be realistic, they're still in technology, technology's still going a million miles an hour. It's not like you get the, they're not going to retire on a beach. Let's put it that way. You know, the company. I love that lifestyle business comment because obviously if you don't take funding, you're considered a lifestyle business. The bottom line is that means cash flow business. If the cash flow is significant, that could be something that we could look at. Okay, we're getting the break here. We got a long day, the keynote went long. We're breaking it down. This is theCUBE. We're connecting the dots, of course, collecting them first, then connecting them, extracting the signal noise. And go to SiliconANGLE.tv. We have guests of the week, every week. Best interview in a podcast form. And every Wednesday we have women Wednesday. We highlight women in tech featured guests on Wednesdays every Wednesday. And go to SiliconANGLE.tv to find out where we're at. Grace Hopper, Celebration of Women in Computing. Dell World, of course, will be interesting to be there with theCUBE. We'll be on the front lines, as always, Oracle Open World, Kentile Open World, among other shows, Structure. Stay tuned, SiliconANGLE.tv. All day coverage continues. Here, live at ADOS ReInvent. We'll be right back.