 from Austin, Texas, extracting the signal from the noise. It's theCUBE, covering Dell World 2015, brought to you by Dell. Now your hosts, John Furrier and Dave Vellante. Hey, welcome back everyone. We are live here at Dell World. This is theCUBE, Silicon Angles flagship program. We go out to the events and extract the signal noise. I'm John Furrier, the founder of Silicon Angle, joined my co-host as usual, Dave Vellante and CUBE alumni, longtime CUBE supporter. We've been there the first CUBE in 2010. Jim Gontier, now the vice president of Enterprise Solutions at Dell and Alliance's. Welcome back. Oh, thank you. It's always great. So you've been on now multiple times as a Dell executive. A lot of stuff happening. And I remember you telling me, John, you can't believe what's going on at Dell. That was your first kind of like punch in our face, like there's some real action happening here. That was about two years ago now? That was about two years. About two years now. So, I mean, did you imagine this would happen? Oh, absolutely. As a matter of fact, our state and where we're taking the industry is very clear. All you have to do is look up and down this hallway, the energy, the excitement, everything else that we're seeing. I'm sure most folks have now probably heard about the huge announcement that we had today. We released our Dell Hybrid Cloud for Microsoft, powered by their CPS standard offering. And I can tell you, literally the line kind of goes no pun intended around the platform over in the demo center. You guys don't get the credit at Dell that you should, in my opinion, on the server side. You've been a server master for many, many years at HP. Now here at Dell, you have a good view. But now there's a lot of converges between server storage, networking, obviously that's the converged. And now there's new areas like HPC. But still, you guys are really kicking butt at servers. So give some color into some of the segment performance for the folks that might not know. Michael quoted 22 new leadership areas. Share some color on the server's piece. Yeah, happy to. So if you look at what Dell's been doing in terms of server. And when we say server, I like them more as compute. And when I say compute, it's what we're doing for the traditional enterprise, what we've always done for the higher end hyperscale, which you may know as DCS. We've now got a new organization referred to as DSS. But instead of going through the, I guess we'll call it syntax of what that is, let's talk about the results. We all know that customers vote with their wallets. And right now they're clearly voting for Dell. Case in point, we're pretty much number one in terms of computational or compute. Everywhere in the world, except for EMEA. And we clearly have our eyes on that target. It's a very small number in terms of what separates us from true total world leadership. And the net is, is that when you look at some of the innovations, when you look at some of the business outcomes and results we're driving, you'll start to see on how we're closing in on that gap and closing in quickly. So no one wakes up anymore and says, I got to buy more Dell boxes. Usually driven by some of the factors now, the solutions. And the word solution provider has kind of been a used term kicked around the market 10 ways from Sunday. But now actually it doesn't matter. So talk about the new dynamic of solution providing. Because that's not just servers anymore, it's a compilation of multiple services, managed services, buy as you go, cloud here and there. No, no, you're absolutely dead on. I mean, if we think about, and most of us have been in the industry for 20 to 25 some odd years, it used to be that folks were very happy buying individual components. That was back in the days when folks stood up, siloed server storage and networking. What we hear loud and clear and what I had the pleasure of hearing at our executive summit where we're surrounded by four to 500 of our closest CIO and C-suite executives, is that really what they're focused on now is delivering business outcomes, delivering business results. They would rather focus on time to value. And so when we think about a solution what that ends up doing for them is that it's a pre-tested, pre-validated, pretty much good to go business results that they can go quickly stand up. But more importantly, it's not just about the technology. It's also what we're doing in terms of the services, the software, the support. And to some extent, you can even look at some of the innovation we've done. One of the biggest innovations, and again, a booth that's full of folks, is what we're doing with Dell Financial Services or as we lovingly call it, the Bank of Dell. Looking for a way where they can quickly deliver business results. Looking for a way where CIOs have now become partners, a line of business owners. And doing that in a way that's not only very quick, very packaged and allows them to focus on those results. That's the reason why we see such a huge solutions uptake. And frankly, the reason why my staff is, let's just say, has their handful answering all of the questions over on the show floor. Is it a good time to be a CIO right now? Absolutely. And it's a good time to be a CIO for multiple reasons. Our industry in general, if you look at what's going on in terms of social, mobile, cloud, big data, and the opportunities that it brings, the fact that most of these CIOs really now are starting to be seen as partners, the line of business owners. One of the favorite comments I got yesterday was the fact that one of them said, you know what, this whole idea around solutions and the fact that I can now walk in and instead of asking for money, I'm walking in and showing results and revenue. That's just like has totally changed his relationship with his other C-suite peers and frankly with their board. All right, let's talk about, we've been talking to Jim about cloud for about five, six years now. Yeah, but it's gotten a lot more fun during the last nine months. So let's fast forward to 2015 and talk about the state of cloud today. So the announcement today with Microsoft, obviously Amazon's a major force. We were just at re-invent a couple weeks ago, growing like crazy. Always saying, how do you compete against Amazon? The Achilles' heel of Amazon is on-prem. I don't recognize on-prem. Today's announcement with Microsoft went right after that Achilles' heel. Let's talk about that. What was announced with Microsoft and let's unpack that a little bit. Happy to. So first of all, let's do some myth-busting. As you and I and others have had conversations on, when we first started this journey, we told the industry that the world was going to move to a hybrid cloud. Some folks thought that was a rather bold statement. Now we've had multiple analyst firms come back and do that. But when we said the world was moving to hybrid cloud, back then the conversation was still public or private. We've come up with this term referred to as industry repatriation or cloud repatriation. A lot of folks believe that it was the easiest way to get to cloud was just to quickly go to public. And that's fine if you're doing test and dev. That's fine if you happen to be a startup. I have a lot of friends who are VCs. I don't know a lot of them that are handing out money for people to go buy infrastructure. So the net is the cloud. No start of spying infrastructure. Pretty much start in the cloud. And that's the point, right? That's exactly the point. So the net is the conversation that used to be back in January, since we're talking about the journey, public or private, cloud repatriation now is not only here, but it's very much a part of what the industry believes. What separates our strategy from everybody else, it's not about one or the other. Like everything else Dell has done, it really is about the customer. It really is about what are they trying to go do. So for us to come in and say that, hey, you can only do it this way, that would be counterintuitive. So our strategy is clear. The world is moving to hybrid cloud. It's not a question of if, it's a question of when and how fast. But more importantly, every customer is on a different click stop of that journey. Some come in and ask for advisory and consulting. Some come in and ask for private cloud. Some come in and ask for public. Some come in and ask for manage, which is, I love your strategy, Jim. But the problem though is I really don't want to own the assets, the inventory or the admins. So with that, we said, okay, great. Should we stand up our own public cloud offering? And the answer was, you know what? As a company who likes to partner, we think that we can actually help our customers more by partnering with the Amazon's, with the Microsoft's, with the vCloud errors, with the Googles and others of the world. So today's announcement is that hybrid cloud strategy made real. We spent the last year or so partnering with Microsoft. And today, both teams very proudly unveiled the hybrid cloud platform for Microsoft based on their CPS standard. What that allows customers to do is have a private cloud on-prem, but have the consistency, have the clarity of Azure and be able to treat that cloud as one unified whole and now be able to seamlessly move things back and forth between them. So now you can pick the right cloud at the right cost with the right characteristics and actually help your business advance. Okay, so that makes sense, but the public cloud narrative, kind of, I mean, your strategy is not to enable your customers, you know, aggressively to go to the public cloud, right? That would cost you money. I mean, if they really want to get there, you're not going to fight them, but you're going to lose money. For every dollar they spend on Amazon, you're going to lose $4 at the tail end, right? But here's the fun part. A lot of those public clouds, we power. A lot of the public clouds that you're giving us, we don't sell to, I'll let the Amazon team answer that. Or you can call Mary Cameroa if you can respond. But getting inside. Okay, so you feel as though that that's not a threat because you can sell infrastructure to the public cloud players. And we're talking the big three. We're focused. Google, Amazon, and Microsoft, right? And don't forget VMware. But here, in terms of volume, I mean, those are the big three. But again, it's not about whether we're going to make money or not. It's about what are our customers trying to go do? What are some of the imperatives they're trying to drive in the results? You're going to have to have some level of infrastructure. You're going to have to have some level of workloads out in the cloud. So instead of us worrying about whether we're going to make money or not, let's figure out how we, in partnership with some of these other folks, can actually help our customers achieve that hybrid cloud. Well, we got to throw up cash so you can invest in R and D so you can add customer value. I guess my point is, what I saw today was a solution for on-prem. Correct. That mimics public cloud simplicity. That to me is a winner. It has taken. You can both make money at that and you can solve a customer problem and add value and compete with Amazon. So to me, that's one of the few strategies and they're a handful that I've seen that says, okay, we can compete with Amazon without owning a public cloud. Correct. And by the way, yes, we can compete but we also can partner because again, being heterogeneous, we have some customers that say, I want to go put some of my assets on Amazon's public cloud. You'll hear this item referred to as Dell Cloud Manager. What Dell Cloud Manager allows us to do and it's done in conjunction in partnership with our Dell software team is that now whether you want to use Azure, Amazon, vCloud Air, Google Cloud Enterprise, Joints or others, you have the capability as a C-suite executive, as a VP of IT easily and seamlessly picking which cloud, whether it's public, private, managed or to some extent a partner in cloud, you can go pick. And your value there is the orchestration of that inter-cloud, multi-cloud layer. Is that right? Our value, correct. Our value is the partnership with Microsoft and that's the one we're announcing today whereby we've created an integrated system. Literally you can go from crate to cloud in less than three hours. So, if you're a C-suite executive who knows you've got to get to cloud, we'll not only get you up very quickly, so that's the cost piece or they should say the complexity piece, we'll also help you do it very cost effectively because one of our fundamental tendencies you should be able to pick the right cloud at the right cost with the right characteristics and we'll also give you back some level of control. One of the conversations I've had at least two or three times over the last two days is a lot of CIOs know that they're shadow IT. But the reason why they're shadow IT is because frankly the constituents thought it was really hard to get it from their internal services. So, if we can make it so simple. But nicely. Yeah. So, if we can make it so simple and we have with the Dell Hybrid Cloud that they can now offer that up as a service, they can now offer that to consistency and it's so easy that they no longer have to do what I call credit card infrastructure. The bottom line is they're able to now pull that back and get a little bit of control. And without citing the customer, one of them who happens to be the CIO for a very large college on the East Coast that you all know is the fact that they were looking at how much storage and how much compute was leaving their campus. They were able to use Dell Cloud Manager. They were able to cut a deal with several public cloud providers and now they have not only a little bit more control but they have access and they can see what other people are doing and they were able to control their cost. So, your former boss, Dave Donatelli, who's now at Oracle said, if you don't have a public cloud strategy, you're screwed. You have a public cloud strategy with EMC but you wouldn't necessarily agree with that. You obviously would disagree with that statement. We would disagree. We have a strategy but you don't, if you, sorry. He said, if you don't own a public cloud, you're screwed. That's kind of his comment. I love Dave but I would finally disagree and by the way, it's not a question whether I disagree or not. It's actually being made real. There are multiple customers, multiple examples and to some extent, let's talk about some of them. We have a CGI who is actually using our hybrid cloud. You've probably heard what we've done with our cloud platform system, both Capgemini and Accenture, some of the leading systems integrates in the world. These are people who know what everybody else has got to offer. They have proudly chosen the CPS platforms and the Dell hybrid cloud as the two ways that they're going to be offering up a combination of hybrid cloud to their customers. Well, that's a big question is that Dave said, Dave Donatelli brought up is that his thesis is if you're selling boxes, you will be extinct. And that if you're not in a public cloud game, minimum, not saying exclusively, having a public cloud, then it's a bad strategy. That's what he was referring to. Okay, well that's slightly different and at that point I would tend to agree more. Our strategy is very clear. We know the world's going to go to hybrid cloud. We know we have to make it easy. We know we have to make it seamless. We know we have to make it cost effectively. So to your point, yes, we will have platforms but not boxes, solutions that are also wrapping services, support and Dell financial services and we will have partnerships in terms of the public cloud and now our customers can pick and choose whatever they need to go do. So I got to get your take on this Q&A question because this is interesting. One of the things I love about Amazon web services they were really doing two major things at once and it's really hard to do at the same time. Commoditize a pre-existing platform and innovate at the same time. We're doing the same. So I want, and Dell has, and that's why I brought up, I want you to share some data or insights or anything anecdotally. Dell has been in the commoditization. They've commoditized PCs and servers and networking. We have great supply chain price advantages. You'll keep in some good margins but getting up in the volume so they know the commodity game. Well, you'll hear the question now as innovation on the innovation side. Oh, absolutely. I mean, you'll hear the terms democratization. That's us actually taking our size and scale and making things readily available. And as you pointed out, we've been leaders in the client space forever. Michael's made it very clear. We're going to become an enterprise solutions powerhouse. We're going to be one of the primary partners that large scale enterprises not only come to but trust. So the bottom line is when we think about innovations I can go through multiple innovations. The Dell hybrid cloud is a perfect example. What we've done in terms of engineered solutions whether it's SAP, whether it's Oracle or whether it's various others. Those are example of innovations. But I don't want to just stop at basically the hardware or the technology innovations. There's a lot of innovations you can do in terms of services. There's a lot of innovation you can do in terms of support. A perfect example of what we're doing right now with our Dell financial services. Nobody else on the planet has the capability of allowing people to match or have their CAPEX turn into OPEX and actually have their revenue streams match their growth. Okay, so I got to ask about the other dynamic. What Amazon and others are showing is that integrated stacks or pre-packaged vertical solutions seem to be working well. Certainly in the big data side and IoT we expect the same. Correct. However, horizontally scalable large scale networks has been a part of open source. So you have kind of a two world scenario now kind of coming together. Scale out commodity hardware, open source and vertically integrated engineered solutions. Are they mutually exclusive or not? They're not mutually exclusive. Again, it's back to customer choice. I mean, if I think about some of the great partnership and you Gents were with us at Red Hat you actually saw our announcements with Red Hat. Some customers want to have open source. They actually want to have some level of control of their software and to some extent they want to have some level of control of future revs and they want to go do that best in class crowd source piece. There are others who basically say, you know what? I want to have tried and trusted Hyper-V. I want to have tried and trusted VMware. And so for those particular folks if those happen to be the standards that they're utilizing we're quickly going to go build engineered solutions for Microsoft, for VMware and we already have reference architectures that we've deployed for Red Hat. So in essence, again, it's back to customer choice and making sure that we can help them with their time, cost, energy, agility and other types of things as they progress to the ultimate hybrid cloud end stage. So Dell has this kind of, you know, one of everything all of the above strategy. I mean, you do. And it's interesting with the EMC acquisition you now get some interesting co-operation going on. More so than we've ever seen. I don't think of it as co-operation. I mean, there needs to be a new word. I mean, you're right. So help us figure out what that new word, you know what that frame looks like and we can maybe come up with a word later. But so here's the fun part, you know when the announcement was made we basically had a team assembly and someone asked me, so Jim what were your thoughts on it and I just kind of smiled and said boys and girls, someone has just literally given us the keys to the solution candy store. And the reason why I say that is if you look at what we're able to do and just randomly pick the large components, right? You look at our compelling assets and you look at what EMC has that's actually a very complimentary set of things in terms of storage. So now think about how far and how high we can reach in terms of solutions for storage. That just opened that up. We've always been great partners with VMware. As you probably well know, I knew Pat when he was the CTO at Intel and he ran the Intel candy store in my consumer days. And so now we have the capability of looking at all of the assets there. And then when you look at software such as Pivotal you look at VirtuaStream and you look at some of the security things we're able to do with RSA. Married to our sonic wall, married to our secure works. The ability for us to truly create industry leading best only fastest first solutions. It's a great sandbox and we're looking forward post the Go Shop and the actual acquisition on partnering them to go build really killer solutions. Well, to me I think services is a real linchpin here. I mean Dell's got the Perot asset. EMC has great services. EMC is always saying we're a product company, not a services company. But I see real services opportunities there. Albeit you've got relationships with the Accentures and others. Well Accentures, Capgems, Deloitte, right. So how do you see that shaking out in the services side? We actually think that's a really good part of the whole last mile execution. When we say last mile execution it's great to have the technology, the software, the solutions and other pieces. But somebody's got to go do that last mile. Somebody has to go have that conversation with the C-suite executive, understand the kind of pain points and the kind of things that their bosses, their boards are asking them for and being able to help craft and architect that. The good news is we have a joint or a J.I. with Accenture. We've just said that we're going to do the same thing with Deloitte. You're going to hear many more being announced and that's even before we give them access to the rest of the candy store, whether it's CMC, whether it's RSA, whether it's VMware, whether it's VirtuaStream or Pivotal. Jim, my final question for you is you've always been talking about choice, industry standard stuff for many, many decades. Are customers and users in charge right now? I mean, they're ultimately in charge. Would you agree? So as a user goes to their IT department it can't be the old IT. That's going to be the new IT. That's correct. Yes, as a matter of fact, everything that you'll hear from us and it's one of the big themes you'll hear here is future ready. And what future ready means, yes, the siloed world where people are just commencing on virtualization, that's kind of old IT. The new world where people are looking at cloud, where people are looking at big data, where people are actually looking at some of the other things, that's the new IT. So one common thread in all of our solutions is that the solutions that we're designing, defining and delivering today, they will work for you both today and tomorrow, hence your future ready. And your take of Delworld this year, storage seems to be the most dynamic element. Obviously you can see the big acquisition, storage company, right? You got pure storage when public, kind of didn't really make the number they wanted. What's left for the competition to do? What does HP do? What does the other guys do? I'm going to let them decide what they want to do and probably I'm not going to give them advice, but here's one thing that we can tell you. Michael said it really well. If you look at what we can do now as a combinatorial, his exact words on stage today were go big or go home, baby. So he's betting the ranch, so to speak. Pretty much. He's a Texas analogy. And by the way, if there were ever any doubts about us becoming Enterprise Solutions Powerhouse, I think he just gave folks 67 billion reasons as to how they'll say, hey, all that cash has went into the debt financing. I mean, HP came out and said, well, they got to pay down $2 billion in debt per year. Dave, what'd you say? That's a rounding error? Yeah, I mean, so. That's a no brainer for Dell and EMC. You've spent combined way more than that on acquisitions. Correct. Let's just take the tactic of, we know that there were folks who were going to throw some foot out there. So while they're throwing out foot, we're actually out executing. And you can see that with all of the energy and all of the partners that are here today. Jim Ganti, thank you for spending the time to share with us the data and your insight, as eloquent as usual. Great, great information. Congratulations, good to see you thriving and you got to spring in your step here at Dell. We're having a ball. Thanks guys, thank you so much. We'll be right back. More live, cute coverage at Dell World after this short break. Join the conversation. Go to crowdchat.net slash Dell World. That's where all the engagements happening. Of course, go to SiliconANGLE.com or wikibon.com for more content. We'll be right back after this short break.