 Hello and welcome to theCUBE pod episode 25 breaking news. We are podcasting live on X formerly Twitter, tweeting podcasting, streaming, periscoping, whatever the hell they're going to call it on X, Dave and John Furrier for episode 25 of theCUBE pod. As we're rocking and rolling Dave, we're streaming on X formerly Twitter at theCUBE handle. Thanks to Andrew and the team in the studio, the super studio we're calling it, powering the super cloud, the super cube, the super cube pod. Thanks to Elon Musk, actually Jason Calcanis, always one pointing out the new feature. So thanks to Jason at Jason Calcanis. Thanks for that, Dave. Kicking off episode 25. We got super cloud for scheduled in October. We got big events coming up. We got VMware Explorer next week, right after that Google next. Tons of news this week, so much happening in our world, Intel's deal falls apart. They scrapped the 5.4 billion dollars of power semiconductor stock is tumbling. I know you got an opinion. The Silicon Wars are added again, arm kicking ass. Cisco earnings came out, became on very, very strong, looking very good there as we had predicted and been covering like a blanket. Probably the best analyst group on the team right now is theCUBE research group on Cisco. Databricks by breaking news and the information today that they're doing another raise. That's actually not a real story. That's not accurate. So the information got it wrong and they're reporting. They're technically not raising money, but they're actually bringing money in. It's not a raise, it's a liquidity. I'll get into that later in my rant section, but certainly again, another report. They kind of got it right, but didn't get it right. So no context there, accuracy. So we'll clarify that information's reporting on that. Gen AI hype is subsidizing, or is it just grandstanding or cluelessness? Gary Marcus weighs in. The king of AI in his mind, saying that AI is not hyped up would it be? He's talking about generative AI as an application. I think he's missing the boat there, but I see his point. Everyone's trying to be the expert in AI, right? It's fun to watch actually. I'm the expert in AI, Dave, Dave. We're gonna get into that in the rant section as well. The Lahina tragedy and Maui continues to be sad, tragedy story and that's ongoing. It hits home in California because a lot of people go to Hawaii and obviously everyone knows that's ever been on a honeymoon or a trip. I spent a lot of time there. Zia Carvella, our cube alumni and cube collective member was there and bought a shirt from the bike store there. He likes a big biker. It's gone the next day. It's so sad. And of course, we got exclusive story coming up with AWS CEO. We got the official news that we will get the scoop on getting Adam Sileski one-on-one pry to reinvent coming up in a few months. Just big fall coming up. The preceding cybersecurity tide. Summer swimming naked as Rob Hover at her in sheet points. The AI universe continues. Gartner has finally labeled Gen AI in the hype cycle. Welcome to episode 25, streaming live early, by the way. This is a preview. You're on Twitter watching right now. Give us a retweet. This is a moment. So good to be here. Great to kick off the pod. Yeah. Good to be here. I appreciate you guys moving the schedule. I got a wedding to go to tomorrow. So I'm gonna be high-tailing it out of here right after we record breaking analysis. We're moving that up. So I'll be working late tonight, John. It's awesome. It's awesome. Okay, so I can see the pod over there. Awesome to lead along from making that Twitter feature on X feature. But Dave, a lot of going on in tech right now. I mean, I'm reading the Wall Street Journal. I know you got your copy there this week. Some, a lot of great stories. The economic climate right now is interesting. Mortgage rates hit highest level in more than 20 years. That's interesting. You got an interesting real estate market. They're controlled by big tech and big PE right now, private equity. A lot of discussion about that. And then I'll see the tech side continues to boom. You know, the AI thing, a lot of people kind of chiming in with the, well, it's not gonna be that big of a deal. You know, there's a lot of total BS being floating around in the marketplace right now on AI. And I gotta say, it's kind of fun at some level, but it's the classic hype market. A lot of people come out of the woodwork and claim that they are AI gurus. We saw this with social media. Remember the social media guru phase? John, we saw it with COVID. You remember, everybody was a COVID expert overnight, right? That's what we do. So it's fun to watch, but the ones, but a lot of the stories, they're missing the context. I mean, generative AI is the hottest thing, okay? We've been using it, and actually we're farther along with the CUBE engineering team. We just had it all hands meeting with our team, and Kent Libby and our team gave a great update on that. And that was, we're actually way ahead of some of that, the people in the marketplace. And we're just in by kind of the default. So we're gonna lean into that. The AI hype is legit, okay? I'll just say this right now. But people don't understand, and these major market forces is an error of pop of, wow, magic. Some people compare it to the iPhone moment. It's really not the iPhone moment. It's really something different. It's the web moment. It's the moment of machine learning, okay? And so I think what Czech GPT did is gave that magic. I call it the Harry Potter moment. I think what episode podcast, Dave, we were talking about the magic of Harry Potter, give the spell, and all of a sudden, the machine does something. I think it's not an iPhone moment, but that Harry Potter moment where people saw it and said, well, that's magic. And it's over now. But the thing is, it is changing everything, and it will be infused in software. And we said that too on that episode. So I think a lot of people that are shooting from the hip, these so-called experts, like Gary Marcus, don't get AI, right? They don't understand the operational impact of AI. And I mean that in not a pejorative way. He probably knows AI academically, but he probably doesn't understand the operational aspect of it as well as we do in terms of where we see companies investing in AI. So let's tell people, let's explain to people. So Gary Marcus, smart guy, he's a scientist, he's an author, obviously smart dude, wrote an article on Substack. What if Jen and AI turned out to be a dud and he's got a picture of this big- And it's a question mark. This big blimp. Yeah. Okay, so that's kind of, okay. But then- The blimp explodes. You know, and basically saying, hey, a lot of people think that there's, well, they basically say there's no revenue. And I'll tell you, so this is where AI and generally, and Gen AI specifically is going to make money. It's like reducing labor costs. I've been saying this for a while. It's about cutting the need for labor because that's where most companies' expenses are. And I don't care what anybody says. I know just know from personal experiences that Gen AI has made me more productive. It's actually, you know, the cube AI, we know this. We used to have a human doing all the clips. Now we have AI doing it. You push a button and the clips are better, right? And way, way higher volume. So it allows scale. Productivity numbers are actually up. I'm not sure output is up, but productivity is up. So I think we're going to come into a productivity boom. But again, it's not necessarily about the revenue and the direct monetization. It's about making organizations and people more productive. And that's going to be trillions of dollars of economic value, in my opinion. Yeah, Gary completely missed the boat on this post. He completely doesn't understand the reality. He's comparing LK99, that big hype, some superconductor thing to the AI hype. And the product- That would have been cool if it were true. I wish that was true. Actually, I wish that hype came reality. But the AI hype is happening. But actually, we talked about last podcast. We said that the earnings of AWS and Azure fell short on the AI side. Specifically, Azure and Microsoft. As we pointed out and discussed on that podcast episode, Microsoft didn't see the revenue. Why? Because there is no revenue yet. It's coming. This is the build-out phase of the CaneBreen explosion. So this is the reality of AI. It is a CaneBreen explosion for developers and new kinds of applications where the ones that innovate on that labor arbitrage that you're talking about or that benefit are going to refactor their applications. It's the same game. Same application, just refactored. That's where the winners are. That's where AI will soar. And that's where you got to squint through the hype and BS and saying, how does it impact the top and bottom line? You'll see it right there in the efficiency. So Benedict Evans, there's a tweet that Marcus put in his post. He's saying, I don't want something that writes mediocre pros. The error rate means I can't use it for data. He says, I've been using chat GPT 3.5 and 4 for half a year now. And really, I haven't worked out anything that's useful for me. I totally disagree. I do my breaking analysis today. I threw a bunch of data at chat GPT and I said, make this into a table. And it just took all the data and just made it into a beautiful table. It would have taken me at least twice as long to do that. And then it did a table, and it wasn't that pretty. I said, give me some HTML code to make this table pretty with colors. It gave me the HTML code. I did something else while it was generating that code. I put it into my HTML editor and then boom. And I just copied. I just took a screenshot of the table, put it into my breaking analysis. It would have taken me, I don't know, maybe 20 minutes to do that if I had to do it myself. And it probably took me five minutes. So I have hundreds of examples like that. Now maybe that's beneath Benedict Evans. He doesn't need that. But I will say this. I do think chat GPTs, I think Jeff Jonas's right entropy is winning. I think it's getting, I do think in some ways it's getting worse, right? I think, but it still gives me good ideas, right? And it's just when my brain is fried, I haven't do something for me that's just grunt work. And I'm like, okay, good, I got this. So I disagree with that premise. Well, I mean, there's two sides of the story that I think are worth talking about. One is the inflated expectations of AI. Yeah, that's fair. They're definitely inflated. Okay, but the lack of utility is off. I agree with you 100%. The people who think there's no utility in this is ridiculous. And Evans knows better, by the way. So I know Benedict Evans is a great analyst, very strong. He's like in that strategy kind of world. He should know better than that, but he's obviously not doing a lot of writing. He's not doing, if he thinks there's no utility for chat GPT 3.5.4, he's probably not doing anything useful. And if he's listening to this, I'm not going to debate that anytime, because like you said, there are probably things that he could be more efficient if he was publishing. If he's looking to write letters to friends and emails and stuff, I can see his point. That's a wrong use case. He's this quote, my friends who tried to use chat GPT to answer search queries to help with academic research have faced similar disillusionment. Well, no shit, don't use it for that. A lawyer who used chat GPT for legal research was excoriated by a judge and basically had to promise in writing never to do it again. Yeah, you're an idiot. That's not what it's there for. By the way, that's not, that's not, that's not Benedict Evans. That's Gary. No, that's Gary Marcus, right? Yeah, if Benedict Evans is smart. No, thank you for clarifying that. But I mean, that's just, that's the wrong use case, right? It's like, so if that's what you're using chat GPT for, you're wasting your time. Use it for ideas. Use it to get a first draft. Use it, you know what I use it for too? For sometimes I miss things. Like, you know, maybe I get four out of the six bullets that I'm supposed to have or six key points and chat GPT will give me ideas. Oh yeah, you know what? Maybe I miss that or ways to consolidate things. So I, again, I use it all the time. I prepare for interviews. I just had an interview this morning with an AI startup with the CEO and I asked him, hey, what would give me some topics you'd like to talk about? And he said, here's the topic I'd like to talk about and here's some of my talking points. I essentially edited it out. I turned the talk into a question and his talk track into answers. And I plugged it into chat GPT. I said, write me a blog post essay on it. It was unbelievable. There was zero hallucinations. How many interviews have you and I done in the last 13 years each? I don't know. Thousands, thousands. 5,000, maybe more. I don't know. Yeah, I'm definitely over 5,000 for sure, if not more. So when we do, The Cube has done a total of 14,000 interviews. No, more than that. No, more than this. There's almost 20,000 videos on our YouTube channel. Oh, yeah, that's the guests. There's a guest. No, 18,000 guests, 30,000 videos. So here's the thing, since I do the same thing, but prior to chat GPT, I would still do, spend a lot of time preparing for interviews, thinking, researching, digging, doing Google queries, et cetera. I will ask chat GPT, give me some questions. I'll ask it to get me started and it'll always come up with like two or three things that it would take me a while to think of. I might've got there, I might never have gotten there. And so then I edit it, I add my own words, I put it into my own tone. I think of things that chat GPT may not know because I got tribal knowledge and history. And I just find it to be a good helper. There's a lot of AI investments right now going on the startup scene. It's still robust, even though there's one article out there I saw was the first one. It's like, oh, the VCs aren't into the seed rounds. You show me a VC that's not interested in AI seed round and tell you a VC that's gonna be out of a business. It's like, that is complete horseshit story. So the startup market is hot. The prices might come down on valuations given that some people are just rolling a front into chat GPT, so there's a lot of head faking. But some of the VCs that are doing seed, they're smarter than that. So I think the seed investment will continue to be dominating the coverage and absolutely more startups are gonna jump in. This is a Cambrian explosion. I think, again, startups gonna be booming. I said this to Swami in February at Amazon when I interviewed him, he agreed. This is a next gen Amazon moment. AWS was built on the back of startups for the first gen in SaaS. I think the second generation of SaaS and platforms is gonna be powered by AI. And there's no doubt in my mind the cloud guys will be continuing to win. Only the spoils go to AWS, Azure and Google and maybe Oracle who's coming up and a pretty good cloud move there. So cloud will win, but the market of white space for startups is gonna be amazing. That's why I'm a little bit nervous about the M&A market right now. They being kind of clueless because of the cold gutting out of the overhype or the, I'm not overhype, the overinvestment bubble that burst. We're living in a tough market right now for funding in the capital markets. So it's like bad food poisoning. You gotta just get it out of your system. And then ultimately that's where we are in Silicon Valley right now. The market is just toxic because of the overreaching. And frankly, the drinking from the trough, I mean the shitload of money that was made over the past 10 years has been incredible. So now everyone's got their numbers, the music stopped, everyone's looking for a chair, musical chairs kind of analogy. It's gonna take some time for this market to reset but the one shining bright light is the AI market on the startup side. So I'm super pumped for that. That's definitely a tailwind. I think it's a great time to start a company. But I interviewed a company yesterday, a company called Apped Edge. And they've only raised $22 million. They started in 2018 and I was like, oh, basically are you screwed? Like all those other companies that raised money in 2018 and now can't do a B round or a C round? And they're like, no, actually we get plenty of dough. We're not doing a raise right now. But the fact is because they, quote unquote, only raised $22 million. You've seen companies raised hundreds of millions of dollars, unicorns. And so I'd much rather be in that position where expectations are reasonable and they've got traction now. I think they got product market fit or they're close to it and now they can scale. And so I think it's a great time to start a company, John. I really do. Absolutely, absolutely. I was just watching our Twitter feed. We got two viewers. So we're like, two viewers? Two viewers. Two viewers. We're rocking it. We're being shadowbanned. That's horrible. Well, what are you going to do? You got to start somewhere. You know, we're going to win one viewer at a time. Well, I think we're going to do so. So I was stoked to see the breaking analysis. Oh, you got four viewers. Hey, look at that Twitter. Four viewers. The breaking analysis company. Tell your friends, let's get to 10. Elon Musk, where are you? So, but I want to shout out to the CubePod. So breaking analysis broke a million downloads last week. Cumulative. And when I went back and looked at where the CubePod is relative to where breaking analysis was in the first six months. And CubePod's 4x, where we were with breaking analysis. So I'm encouraged. It takes time to get this stuff going. I get great feedback from people. Somebody was met with somebody last night. I said, hey, I love your CubePod. You and John riffing it out, arguing with each other, East Coast, West Coast. You were the time. I'm in my hoodie today because I'm behind, but. Hey, I can't believe you're not wearing a tie. I'm going to post this topics on Twitter here. I was saying that's bad. But yeah, I got a lot of shit to do. I'll be here late tonight. I got to pick up my son at the train station midnight. So I'll be working all night. Well, I want to get into the whole, there's a continuing investment in AI with GPUs. We're seeing startups just coming out to challenge Nvidia, which in the spirit of AI I got my Nvidia cup right here. And then of course, Amazon's already well into its chips and software. Amazon's getting the race. All this pointing to, and we've covered in detail. I know the research we've put out, you've put out personally on Intel and the chips at Amazon, the arm momentum we called it out at AWS has been discussed all the time on the Cube. But the deal this week that caught my attention was that Intel fell apart with their $4.5 billion acquisition of Tower Semiconductor and the Foundry. So you've been on this from day one and we've been talking about on the Cube and Pat Gelsinger might not be able to pull it off. Intel could go under. I mean, this is the iconic brand, Dave. Intel inside, Intel, there's a possibility that Intel could go bankrupt. I just want to say, I mean, sometimes it sounds like we're rooting against Intel. We're not Intel. The United States needs Intel to succeed. And number one, number two is, look, we love Pat Gelsinger. I mean, he is an icon. He's an industry legend. He's a friend of the Cubes. And we have deep, deep respect for him. But I just, I look at this, it's just that the news just keeps getting bad. I mean, they were celebrating and everybody, oh, you know, some of the analysts were high-fiving Intel's quarter and they beat expectations, but their revenues were like precipitously down. Okay, but they beat expectations because PC strengthened. Supposedly they gained sheer, look at this. The problem is the same. But first of all, the tower semiconductor deal would have been a good partnership for Intel, despite its cost, because it gets them closer to two nanometer. Pat has said we're going to get to two nanometer. We're going to leapfrog everybody and go right to two nanometer. And this is where, to your point, Intel could go bankrupt trying. So now they're going to have to partner with the tower semiconductor, but it's better to own them. But the problem is the same. They are behind on wafer volumes. ARM has 10x the wafer volumes of Intel x86. And that is the fundamental problem. Everybody knows Moore's law. Let me just take a second. Theodore Paul Wright was an aeronautical engineer. He came up with Wright's law back in. I got to look it up. It's back in like the early part of, you know, last century, mid part of last century. He died in 1970. So Wright's law, it's really arch-invest as an interesting page on Wright's law. What is Wright's law? Pioneered by Theodore Wright in 1936, Wright's law aims to provide the reliable framework for forecasting cost declines as a function of cumulative production. In other words, it states that for every cumulative doubling of units produced, costs will fall by a constant percentage. Let's say in semiconductors, that's 15 to 20%. And that's really important because when you go to the next generation of semiconductors, because volumes are much lower at the initial curve, you know, it's the learning curve, you, your costs are going to be higher until you surpass that volume. So if you can't double your cumulative volume, you can't cut your costs as dramatically. Well, ARM, because it doesn't make chips, it sends, it licenses technology and sends them off to TSMC and Samsung, ARM wafer volumes are exploding. Now, Pat will admit he's behind on wafer, but he says, but we're leading on packaging on transistors. And that's where I call bullshit. You know who's leading on packaging? Apple, Nvidia, Samsung, Tesla, even AMD, they're making smaller system on chip packages. And so, you know, like I said, Intel wants to go right to two nanometer and tower semiconductor was going to help them do that. Getting foundry customers is a top priority for Intel, but the problem is that the foundry customers that I've talked to who have, you know, gone there and stuck their toe in the water to say, you know, it's not ready. They have told me that Intel has probably got five years before it's going to be able to get the reliability and quality that they need for these customers to trust them. So I don't know what to tell you, John. I mean, it's not a good story for Intel, even though again, Pat is out telling a, you know, putting on the bold face. He was in China in the last month trying to get this deal to go through. China ended up blocking the deal, but, you know, Intel, you know, continues to be in trouble in my opinion. I am not. Do you think they could go out? Do you think my statement that they could go out of business is legit? Yeah, I think Intel could go broke trying to compete in foundry. And I've said before, I think in my opinion what Intel should do and should have done is split off the design from the manufacturing. They should do a manufacturing deal with number two, which is Samsung. They should do a joint venture, base it in the United States, get the US government to put some dough into it, reduce the reliance for the industry on TSMC, and through that joint venture, use the Samsung expertise to try to get Apple's business because that's the only fucking way they're gonna be able to get volume to be able to compete with the volume and the economics that ARM has achieved. Yeah, I think the Intel inside generation from our old school, the X generation that grew up with PCs and the boomers before us was the PC and now it's the cloud. If they don't get the cloud business, if they don't get the Edge, the IoT and other things, they're toast, right? They have to get Apple, they gotta get AWS, they gotta get Google. They're buying servers in massive quantities. They got the OEMs on the traditional side, so I think they'll do well in some of the data center plays, but they gotta get the cloud. That's what the scale is. I totally agree with you. ARM designs are gonna dominate at the Edge. Edge is all about low cost, it's about low power, and it's about great performance, and ARM has the advantages in all of those. You think about, Pat, I heard him on TV recently talking about NPUs, the Neuro Processing Unit. He said, yeah, we were a little bit behind on that. I mean, Apple's been doing this for five years. Tesla, basically, that's how Tesla got rid of LiDAR and is using cheap cameras, using the Neuro Processing Units that they basically programmed on their own. And so, again, the Edge is gonna be the winning play at the Edge is gonna be the chips that have volume, so it's gonna be ARM-based designs. You know what else? Broadcom, because Broadcom's doing all this connectivity, Hock Tam will say, we don't do CPU, okay, because we can't dominate CPU, but we're gonna dominate all the connectivity and all the cross connectivity between all these components. And so, companies like that are gonna win. And so, and I just, you know, again, I'm rooting for Intel, but I think that Pat has basically come out and said, it's an execution problem. And while Intel has had execution problems, I think the problems are more fundamental. And believe me, I perfectly understand Pat has forgotten more about the semiconductor business than I will ever, ever know ever in 10 lifetimes. But I just- It can count out Gelsinger, but they moved to the government and playing in the national security card seems a little desperate to me. And I think Intel, and that's why people are dumping the stock- Well, they are desperate. They are desperate. That's my point. $50 billion from the U.S. government isn't gonna do shit. I'll tell you the other thing is if the, I mean, frankly, Apple, Amazon, maybe, certainly the U.S. government, Microsoft, they could all write checks. Their balance sheets are such that they could write checks. Facebook could write checks. And actually, if they gave a shit about the U.S. competitiveness, they could write some big checks and funnel it to Intel, maybe do that joint venture with Samsung, entice Apple to do business with them, because that's where all the volume is right now. Why do you think TSMC is so effective? It's because it sucks up all Apple's volume. And so it's just, I mean, I love the aspiration and I listen to Pat very carefully and he says all the right things, but I think there's a fundamental type A problem that they're facing. And look, I'd love people to tell me I'm wrong. I mean, I do see analysts out there saying, hey, that was a great quarter. I'm like, are you fucking kidding me? Yeah, those analysts are getting paid, by the way, retainer to say nice things about them. We know who they are and they're on TV doing it. Look, Intel's got problems. You know they're desperate when they're getting money. If they go to the Saudis to get money, you know the game's over, right? That'll be the tell sign of Intel. And they're hurting and we want them to win. I love Intel. I think they're like Hula Packard to me. They're the Silicon Valley story. The Silicon Valley, Intel, HPE, HP, the original HP. I got a book behind me, you can see right there. It's the Bill and Dave Packard, you know, managed it by walking around. I got that when I worked at HP. Great companies with great culture. If Intel loses, okay, that would be the sad moment. I think Pat Gelsinger should have been on earlier to save the company, but I think it may be too late. Yeah, I mean, I think it's something else. So, you know, we all know Moore's Law. When you do the math, you've probably heard me talk about this many times. When you do the math on Moore's Law, everybody says Moore's Law is dead. You do the math, it's like basically, you know, the doubling transistors every two years, whatever, doubling performance. It's about 40% annually, performance improvement. It's little less than that these days. But if you look at the combination, look what Apple's doing, even you go back to the A15, which is, you know, A15 and A series inside your smartphones. You look at the CPU, the NPU, the GPU, which it uses for the screen, the accelerators inside of that, the annual increase in performance is over 100%. You see, you compare that with x86 annual improvements at 30% or 40% even, if you want to give them the benefit of the doubt. Apple was doing this five years ago, they were on that curve. And they're using an ARM-based design with the M1, with the A series, Amazon's on that curve with the Anapurna stuff, even though they're doing their own silicon. It's interesting to hear Hock Tan talk about merchant silicon versus the in-house stuff. Obviously, Hock Tan wants the in-house stuff, but he wants the merchant stuff, he doesn't want people doing in-house. But there are strategic reasons to do in-house silicon to be able to get on that curve and control your own destiny. And again, I think Intel's five years behind. Could they somehow get to be the number two foundry by the end of the decade? I mean, I think if they did some radical moves to get the quality up and get Apple volume, that would be awesome. I just think they get a long road. And I think it's the probability, I would put it less than 10%. Yeah. Well, let's hope then, John. Good analysis, Dave, as always. I'm surprised that Intel doesn't make better moves, but we'll see. We'll keep in touch with those guys. It's making all the right moves. If in fact, if you said, this is your strategy, you have to execute this strategy, go. Pat Gelsinger's doing all the right things. But I think there should be a discussion about, is this the right strategy? Is this the right plan? And I don't think it's the right plan. I think the better plan is to split the company and do a JV with somebody who's got a foundry and is way further along than Intel has foundry, but way further along than Intel foundry. Yeah. They got to carve a path to the future. I agree. And I think that's a good strategy. This is where, the last thing I'll say is, this is where Andy Jassy's quoted about, there's no compression algorithm for experience. More than any other market that matters for in semiconductors. Yeah. You can't fake it till you make it there at all. If it's one of those markets where you got to be on the right side of the trend line and you got to do it years in advance and you can't just jump in. There's a, this economies of scale, Dave, as you know, we talk about it all the time. There's these, this economy of scale in these markets. Speaking of this economy of scale, transitioning to the Databricks story, because I want to get to that because the information has reported that they're doing another round of funding. Silicon Ankle picked up on that news and reported it, but we still got more information. They didn't get it 100% right. The information is known for breaking stories. We've got a great organization over there, Jessica Lesson, has built out a great business. She's kind of in the class of theCUBE. She started 10 years ago, a couple of years after we started. Modern, kind of firm, doing good work, but they broke a story, but I don't think they got it right. They talked about it. I was surprised when I saw that, John. I'm like, what? This can't be right. That's not, this is counter to everything we know. I mean, a bit of information we have. This is the problem of getting, explain it, please. So first of all, it's not, first of all, they got the story, they're raising money, but they didn't get it right. And it's hard to get this right because it's very nuanced. When you do the kind of investigative that we do, we go deep in the trenches. We kind of know the story. I'm glad they confirmed it because we can now talk about it. But the fact of the matter is, they are raising money, but they don't, they're not raising money because they need it, and not raising money because they're gonna take a new beachhead. That's the wrong story. They're raising money because they can. Databricks evaluation will put $28 billion roughly around that, during the peak of the market. I would say it was even higher. I would say it was closer to mid to high 30s. Bottom line is massive valuation. They raise over a billion dollars in cash. That's a lot of clock, and they're doing close to a billion in revenue. So even if they're losing that much money, they still have plenty of cash. They don't need the cash. No, the balance sheet is good to your point. Right. So given this capital markets, public markets, sideways, and private markets, there's the man for the stock. So I always talk about this in Silicon Valley. When you have these hot comes like Databricks with a comp like snowflake out there. If you're an investor, you go, hey, I can come in, get a valuation, given it's kind of a down market. If they went public today, there's no way they'd have that valuation. So there's probably a valuation reduction, hence not going public. And so they got to get their fundamentals and stay private. Why would they go public? It's a smart move for all the gods and team to stay private. They can do things like this. So, but if you're a stockholder, an insider, an investor, an employee, and you sell stock into this kind of private secondary situation, you can make more banks. So I'll give you an example. Say you're an employee that started in the first couple of years and your stock's options were worth a strike price of just using a dollar, okay? And now it's worth a thousand, okay? And it was valued at 10,000 on the public market. You might want to say, hey, you don't want to buy that house. I want to take a couple million off the table. You sell 10,000 shares and you can get $1,000 for a share or 10,000 a share. I'm using those numbers just to make a point. It's a shitload of money profit-wise. You take some profits off the table and you roll the rest forward. And if they do go public, they can get that up. So if you're an employee, the companies should do a good job of getting some liquidity. So if you're an investor, you can bulk up a bunch of stock that you never had a chance to get before at a higher price, but you're betting on a step up on the public offering. Okay, that's what's happening here. Databricks, there's demand for the stock. Hell, I'd buy some stock if I could. But if you got a hedge fund out there, Dave, you know this. We've discussed this on theCUBE many times. If you're an investor and you've got a couple hundred million billions of dollars to play with, Databricks is kind of a sure thing. At least in my mind, it's a sure thing. So explain this, John. So VC 101 is they're trying to get massive returns, 100X, certainly 10X, 100X, maybe even 1,000X, right? And they know most of their bets are going to fail, but they get some percentage, small percentage, but they're massive home runs, Facebook, Uber, I mean, you know, the list goes on. And those are the ones that they talk about and those are the ones that make them famous. Hedge funds and private equity, different story, they'll come in much later to an investment and if they're getting 2X, they're thrilled. Because they put in a ton, they put up a lot of money. Massive money, right. And so that's what's happening to your point is what's happening with Databricks now. So if Databricks' last round was, let's say, let's call it 35 or 38 billion, whatever it was. And let's say now I can get in the low to mid-20s and I could put in, I don't know, 200 million, 300 million and if I'm a shareholder, like maybe I'm an employee and they want to get these guys liquid because they didn't get to the IPO in the window, hey, why not? I'll take some money off the table, lock it in and so it's a win-win. Dave, just to put it in comparison, Snowflake, a comparable and we've discussed the difference between Databricks and Snowflake. So as a betting person, you can say, hey, first of all, Databricks is already a home run. That company is kicked ass. We've been following them since their existence. We know the founders are all on SCUBE but now they're like a darling, they're kicking ass. So the VC's already made their cash, probably cashed out. The employees can cash out, founders can cash out. This is a liquidity market, in my opinion. This is what goes on because the demand for the stock, even private, is huge. So the comparable stock that's public is Snowflake. Okay, the symbol on the New York Stock Exchange is Snow. Love that, love that, love that ticker. One of my favorites. It's at $146 a share at $47 billion. So to your point- When out at 120, John, when out at 120, day one, doubled to close to 240. At one point it hit, you know, it was up, I think it hit 400 at one point. And now, like most stocks, I always tell people, don't buy it at the IPO. You'll get a chance to buy it close to where the IPO price was. But still, it's above- The high water market is 160, no, 190. What do you mean high water? What? All times? Price per share, yeah. No, no, all time was much, much higher than that. It was like, it was 400. No, 387. Okay, almost 400. So it was over $100 billion in value at one point. And so, yeah, that maybe was a little bit over the top. In 2021, November 2021, it went on a downward slide. It went as low as $122. It's at $146. It's still higher than the valuation that someone could get in on Databricks. So the story that can't be confirmed because no one's going to go on the record, but from sources close to the situation, I can tell you that there is interest. I can't say transactions happen. So the fact that information reported some funding validates our data that shows that there's demand for the stock, but not at the price it's currently at. So that means that there's liquidity. That means there's demand. And hey, David, we were running a hedge fund. We do it too, because we love this company. We think this company- Yeah, if you could get into the Databricks deal at a $20 billion valuation. Yeah, you would take that chance. I would definitely, that's a bet that I would take given the fact that Snowflake, the comp is already high. And assume that Snowflake even goes down, which I doubt, this data market is booming. I mean, I think there are some risks to the equity market. I mean, if interest rates are going to be higher for longer, that makes equities less attractive. But I think, productivity is how we get out of this problem. And if productivity doesn't go up because of AI, then I guess we're all screwed. Yeah, so that story is good. So thanks for the information for cracking it. You can thank us later for clarifying. No need to send money. We appreciate this. We do. I love it. I love it. But watch us, but re-tweet our live stream. We can use the help. I know it's a boot all on the paywall. By the way, information is a paid service. They don't have a publication. That's free and they've done great with that. So I like that company. I like the team there. I mean, if you have a paid service like that, your shit has to be so good, right? To get people and they, their stuff's good. I gotta say, I think it's better than Business Insider. Business Insider is kind of, you know, click baity. Whereas Insider is 10 times better than Business Insider. Yeah. Information had one goal and that was to be, they're doing what they're doing. Be, do the investigative journal and break stories, be the source of the scoops and their scoop machine. That's what they're built for. We, on the other hand, are data machines. So we are built to get the real story and deep dive and get the data. So we love working with them because they get the scoops. We can add to our puzzle. So we, you know, again, that validates what we know and hence the report we just sent, which is Databricks is doing some funding, but not because they need it. Because they can. That's the bottom line. Databricks is the bottom line. And they're letting people get liquid, you know? Why not? Taking some money off the table. Why not play with house money? So, some of Cisco, so Cisco just had their earnings. We're gonna get to VMware in a second with the event coming up next week. They beat the estimates. You were involved in the whole circus of the earnings report. You had some inside view and access to the executives at the Cisco earnings. What did you learn? Obviously positive sign for spending. Cisco's on the rise again. We analyzed that during the Cisco live event we had. We were critical of them, but we were pretty bullish. I think some of those things had panned out, Dave. Every bit of their business is firing on all cylinders with two exceptions. Collaboration because, you know, the COVID boom and that's down. And security is not where G2 Patel wants it. I mean, security business is flat. And, you know, security should be growing. So, but I look at that as a positive. Cisco is kicking ass. There were 15 billion revenue quarter, grew 16%. So, their top line is growing and their bottom line is growing faster than the top line. And they basically said, we're gonna commit long term toward operating leverage. Meaning, our bottom line is gonna continue to grow more than our top line. And the reason is because they're increasing the contribution from software, you know, much, much, tens of billions, $20 billion plus software business. Their remaining performance obligations are enormous. And so they have much better visibility on their business. And it was interesting. So, last night, as I was getting on the phone with some of the execs to talk about the quarter, just after they released the quarter, I saw the stock was down and there was a headline at Barron's and I tweeted it out. I'll have to pull it up here. But, and so the headline was negative. Cisco gives, here it is right here. Cisco, oh, this is the new headline. The new headline is Cisco stock rallies on rebounding orders by Eric Savitz. The original headline, same article, was here, I'll pull it up right here. Was negative, basically saying, you know, the stock is down or the guidance was down. So, the stock was down like 3% after hours. This is the rebound one, rallies on rebound? Yeah, yeah, so the earlier headline on Barron's, which was changed by this guy, Eric Savitz, and he changed the- I know Eric, he's a Palo Alto dad. Yeah, he does good work. He's good. Yeah, no, he is good. But, you know, he probably heard, he probably heard, you know, bad news or whatever. And so I said to the executives, I'm like, wow, your stock's down. And they go, what? We're doing high fives here. You know, we're kicking ass. And I'm like, really? I don't know, maybe they got the story wrong. Well, sure enough, when I jumped on the conference call, there was super upbeat and all of a sudden the stock started to go up. And then lo and behold, Barron's changes the headline to Cisco stock rallies on rebounding orders. So what happens? Did they get it wrong? Yeah, yeah, they got it wrong. I mean, they misinterpreted the guidance. And so the guidance was, I think prudent. I wouldn't even say it was conservative. I mean, there was so much more good news throwing off tons of free cash flow. The gap EPS was, I mean, it was just, you know, I mean, really a strong year, great free cash flow, great margins, you know, in somewhat conservative guidance, but not really, I mean, you know, pretty prudent guidance in my opinion. So that was pretty amazing. I've never seen a sort of a turnaround like that. In fact, you could see the stock price, it went down 3% and then it was up like 4% after I was and I think it closed probably just before they opened today. You know, 2% and what did it close today? It must have been up today. What's the stock do today? Cisco was up 3% today, 3.5% today almost. So pretty wild. It's interesting to talk about market caps. HPE is only a $21 billion company. Cisco is at 223 billion, which means that snowflakes value more than HPE. So do you want to hear something amazing? It's kind of off topic, but it's just insane. So I'm prepping for breaking analysis tomorrow. Zia's Caravalli is coming in studio and Zia's Rob and I, Rob Streche, are going to do a breaking analysis. So I'm going to, so the working title here is VMware's Future Navigating Multicloud Complexity and Gen AI under Broadcom's wing. So I pulled out, you know, what Broadcom said they were going to do with VMware. They said they're going to, you know, put 8.5 billion of pro-forma EBITDA contribution. They got some thoughts from Hawk Tan. And I did a Broadcom and VMware, just a very simple financials. Broadcom is insane. Broadcom is a $34 billion company with 20,000 employees. It's got 67% gross margins and it's mostly a semiconductor company. Its EBITDA margin is 58% and its free cash flow margin is 49%. Its revenue per employee is 1.7 million per employee and it's got a $343 billion market cap, 10x revenue. VMware's a $13 billion company. It's got 38,000 employees. So it's got $350,000 revenue per employee, which by the way for a software company is pretty good. But VMware's worth, VMware's worth more than that market cap. It's like 30 something. No, 67 billion is the market cap, but it's got 38,000 employees on a revenue of $13 billion. So its revenue per headcount is 350,000, which is good, but compared to Broadcom's 1.7 million per employee, it just blows you away to see how profitable Broadcom is. So we're on the eve of next week is VMware's annual conference, formerly known as VMware Explorer. VMware World, now called VMware Explorer, will be there second year to use the new name. Broadcom buying out VMware, the speculation that that's gonna be announced to show something is gonna be for the year end. No, it won't be at the show. I know, I know, I was just saying Summer's saying, we're saying it's gonna be shifted out. But I think maybe November. But there's breaking news, breaking news right now. Broadcom secures $28 billion debt financing for the VMware buy. So they just secured the financing. Now you remember, Dave, when they did the deal, they secured a bridge loan for 32 billion that they entered into the deal with. So they now have secured the debt financing, okay? And so this is being reported as we speak. Two minutes ago, wow, okay. So yeah, it's popping. So we're rocking and rolling with some breaking news here on our live, our first streaming to Twitter on our podcast, which we'll do more of, by the way, and get it to spaces as well, we'll figure this out, but, and we'll ship the podcast tomorrow as normal cadence, but we'll do the live, but. So retired some earlier debt. Yes. Yep, mm-hmm. Yeah, okay. So, yeah, and what Broadcom's gonna do is they know they're gonna de-lever. They obviously have to reduce headcount. I mean, that's inside our broader story that we covered weeks ago that they're gonna gut VMware around the acquisition. I found out that people got letters. Some didn't get letters. So they already know who's gonna stay or go. But I think that Broadcom, and if I had to make a bet knowing from the sources that were there, what I'm hearing is that Broadcom's gonna say, okay, let's see you guys work for a couple of quarters. And you actually called this out on your first memo, but that's actually happening. You actually got it right, Dave, and when you published your first, we got it right to the T, basically. And I think Broadcom's very metric oriented. Okay, you got a business plan, put it out there, hit the numbers, we go. If not, you're gone. I think they're very much like that, which is why people give them a lot of shit for their management style, but the stock is off the charts. Oh, it's unbelievable. Octan will say, I think it's 17 business units, and they're all independent business units, and they gotta perform. And I think that he's gonna make VMware an independent business unit. It's gonna make Broadcom 50% software, which by the way, I don't really think he gives a shit. I don't think he has some vision of I'm gonna be half software, half, I don't think he cares. I think he just wants to have great businesses that have a sustainable advantage where they have leadership and they have a big install base. And everybody says they're gonna raise prices, which is probably true, but I think the strategy is not that simple. It's not as simple as we're gonna raise prices. I think the strategy is gonna be buy more and you'll pay less. And so if you make bigger commitments- Hey, that sounds like Jensen at fucking the committee. Yes, yes. If you make bigger commitments to VMware, we're gonna give you the best deal. And if you don't make bigger commitments, if you make smaller commitments, we're gonna increase your price. So here's the business case. Now, the key for Broadcom is they gotta continue to invest in a very focused way. And that's what they've done. They direct R&D in like a laser focused way. They cut out all the bullshit and all the experimentation and all that stuff. And they just drive customer value on a roadmap and they execute like crazy. And if they don't, Octane shoots them and then you're out. I think I just dropped an F bomb in my excitement of Broadcom's activity. They're so freaking awesome right now with their stock, but the thing about VMware that's gonna be critical to them is that vSphere is just a cash cow. And if I'm Broadcom, I've gotta worry about the renewal cycle because here's the psychology of the VMware customer. I'm sure Broadcom's all over this, so they're probably gotta handle it. But if I'm Broadcom, if I'm advising Octane, Oct, if you're listening, here's what you gotta watch out for blind spot. VMware's got a lot of shelfware in their system. They've got great products, we've got vSan, vSphere, killer products. They have a lot of other stuff that their customers get. If they don't install that, it's what they call shelfware. It's sitting on the shelf, hasn't been deployed. That's what they call shelfware in the vernacular of the software business. If I'm, if I am Broadcom, I wanna keep the SEs, I wanna keep the field employees, getting the customers to keep the installations of the shelfware going because that's another license renewal. Because if I'm a VMware customer, okay, I'll pay the tax on vSphere, I'll pay for it, but you know what? I'm not gonna renew that other stuff. That would be a huge impact to the dollar. So I would be very focused on from a hedge perspective and also business fundamentals perspective to say, get that shelfware installed. We need it in there to make sure that we have the hooks to the customer. And then we bring more Broadcom love to the table with chips and they can get in there. That Silicon innovation, I said from day one, and I might be wrong, but I might have to eat my words, but I said from day one that Broadcom's chip leadership because the stack, we've called it the super stack, super chips, super computing, super cloud, super apps. If I'm, I want that integration up into the app. I gotta have more off, offloading to Silicon, a lot of these application specific things in the platform. And I think that's a huge opportunity for Broadcom with VMware. If they're not thinking that then they got, then they're in for just the cash as you pointed out. So I think, you know, the debate is are they in for the cash cow or they am I overthinking it Dave on this? So, but get the shelfware installed, get the installs in there, increase the license on the renewals, get those renewals with more elements versus just people downsizing the VMware or right sizing VMware. So, I mean, it's amazing, a job as Gelsinger did with VMware. A lot of it was sort of a shell game where it was buying companies. I mean, an example of that is Carbon Black. You remember, he remember he was on theCUBE that when they announced the Carbon Black acquisition, he said, you know, I paid what $2.3 billion for Carbon Black and here's CrowdStrike with a $30 billion valuation. I think I got just as good a product for way less money. I'm not sure. And so I've talked to CISOs who are Carbon Black customers like I'm really nervous. That VMware is going to jettison Carbon Black, which they very well may do. I don't know. But so that's the question is VMware, can they be number one or number two Jack Welch in security? I mean, obviously they have to have security, but can they monetize security the way that Octan is going to require? And if they can't, he'll do like Michael Dell. They sold off a bunch of assets from the EMC acquisition and he delevered and that's how they got rid of the debt. And Octan has said, we are going to delever. So the question is, okay, what's he gonna sell? He's not gonna sell vSphere, you know, of course. You know, I think- No way, he has to keep vSphere, that's the cash cow. So he's gonna take the cash cow vSphere and he's gonna look at all the relevant components around that, vSan, NSX and say, okay, what's making us money? You know, what's shelf wear? What's making us money? If it's shelf wear, you got, I don't know, you got two quarters to make us money or else you're gone. And so, and he's got tech, that tech is, he can turn it into liquid assets and put it right in his balance sheet. And they've done this so many times before. I do think it's different. Everybody's comparing it to the CA and Samantha, CA in particular, it was like mainframe software. You know, VMware is so relevant. And look at the ETR survey data, prepping for breaking analysis. If you look at the 1700 or so ETR respondents, 50% have VMware installed. So their presence is enormous, the overlap in between IT shops and VMware is huge. You're probably surprised it's only 50%, right? And so, they're a critical component. They're like air, you know, just unhook VMware. Where are you gonna go? Yeah, exactly. And by the way, the VM migration, the virtual machine migration to cloud native services is happening, but it's not happening at massive scales. It's not like it's going to be extinction. It's kind of like climate change, Dave. You know, you think it's going to happen, but you don't know when. The polar ice caps are melting. So VMware is a locked and loaded killer business model. They've been, it's the gift that keeps on giving. Look at the 13 years we've done VMware, VMware world and now VMware is war. Every year, Dave, vSphere, the core virtualization product, that is the core, it runs operations in IT. IT is changing, Broadcom knows that. They see the OEM data. They know what's going on with the machines and the hardware from data center, cloud to edge. They see the software stack changing. They're not dumbasses. They see VMware as an asset from a cash flow perspective. And if you strip out all the other stuff around VMware, it's got the crown jewel. And it's been that way for 13 years. Look at all the stuff they've tried to introduce. Software defined data center. Well, guess what? Is NSX going to hang around? We'll see. Well, if that's going to be part of, I have to buy into NSX to get this. Project Monterey, you asked about that last week in the podcast. Well, if it's tied to NSX, it might not work. There's maybe people, not everyone's going to use NSX. Okay, so again. Yeah, I mean. You know, when you get, as a company, you kind of tie things together. But if you're Broadcom, you go, give the customer choice. But I do think Coctan wants growth. And I think he's betting on multi-cloud. So that's, you know, super cloud. It's going to be interesting to see if they can monetize that cross-cloud complexity. And VMware is in a good spot to do that, as good a spot as anybody. Because they got VMware cloud on AWS. So they got, and they got, you know, similar products on all the other clouds. They've got VCF VMware cloud foundation for private cloud stuff. And they're ubiquitous. So they can connect the dots and solve some management problems, inject AI into for IT ops. You know, that's a pretty good play, in my opinion. But VMware, of all the years that they've had any good story, I thought that the past couple of years, they were on a trajectory. They bought Heptio on the cloud-need-a-side. Raghu has sharpened his saw in there. He was getting the job done. They had the playbook getting laid down for this kind of next-gen cloud. Broadcam came in at the right time. So it'll be sad to see Broadcom, if they got it. But VMware did have a lot of overhead in the other businesses may or may not have been doing well without the lift of VMware headquarters, the main boat. So the main boat is the cash cow. And then so that did carry a lot of stuff around VMware. If Broadcom can nurture that trajectory, they could be a leader in the cloud-native world. They had everything going in the right direction. They had a deal with AWS. They got the multi-cloud cross-cloud services. That story is resonating. Does it have enough teeth? If they cut it, we would never know. It never gave it time to run or grow. So do they chop that out early? Does that, do they give it enough room to run or grow? Are they throwing the baby out with the bathwater? Whatever you want to call it, that's the challenge that Broadcom has. They got to know, do they give it enough chance they just fish or cut bait? I think you're right on on that, John. I mean, if you think about it, I mean, the partnership with Red Hat, their partnerships are kind of funny, Red Hat and VMware, they kind of, they need each other, but they kind of compete. And let's face it, OpenShift is the product. That is the container servers, the container platform, that it's got probably got at least half, maybe more of the revenue in that market. The market share is OpenShift. And VMware wants to compete with that, but OpenShift is more mature. It's got way better traction. You know, it's working, it's successful, it's ubiquitous. So, maybe we'll be there next week in Vegas. We're going to be on the ground. We're going to be deep in the bowels of, in the trenches, deep in the throat of AWS, VMware, all the partner ecosystem. I mean, VMware's ecosystem is amazing. They have a community event. By the way, Sticker was spotted in the wild. And I put on Twitter, a super cloud sticker that was spotted on a laptop in Palo Alto with cloud expert program. We're getting tattoos, I heard. So, you know, they have the v-experts. Fitsy says that we should get super cloud tattoos. That wouldn't make it real. Basically, he said, if we get super cloud tattoos, he's going to capitulate. Yeah, that's right. No, he wants it all over the face of my face. The Mike Tyson tattoo. He's great. I love Fitsy. I get a cube tattoo at this point. 13 years doing the cube. I might get a cube tattoo. First one to get a cube tattoo gets VIP status forever. There you go. By the way, quick aside, the Forrester put out a report, the future of cloud. Cloud becomes abstracted, intelligent, and composable. This is July's 2023. Yeah, sounds like super cloud. Yeah. We've gotten past that report called super cloud. Well, I think everyone wanted to know the definition. It's funny. Fitsy's tongue in cheek because he's playing the game. He's a blogger. He knows the game. But he kind of gets that we're onto something. That's why the more he says it's not a thing, the more it's a thing. So that means that it's becoming an industry thing. And what he doesn't understand is that when we started doing super cloud, we wanted to make an open conversation. The whole idea was our original discussion at re-invent 2021, was that 2021? When we identified that super cloud abstraction whether the success of snowflake, it didn't fit into a mold. It didn't fit into a peg that was industry standard. It was different. We talked about snowflake, Databricks. And since then, if you look at the stock prices and value of snowflake and Databricks, MongoDB, since that time, it's been huge. So we are right on super cloud. Number two, we didn't want to have to do a lot of research, like go away and make up something like what Gartner does. Gartner is just now getting to 2022 market share, Dave. So, like, so, you know. That kills me. The research people aren't that good anymore, right? So, like, in terms of getting stuff fresh and relevant. So we felt super clouds better to be discussed publicly. And look what happened. IDC does a way better job on data than Gartner. I mean, they're market share focus. I get that. And they get that. And they get the thing. But the thing is, is that it's been showing that people in the ecosystems are changing. I think if you look at all the transformations happening in the market right now, the number one thing that's becoming as table stakes feature is, if you're a platform and that's your strategy and you're a company, whether you're a big old incumbent or a new rising star, if you don't have an ecosystem, you're nothing. Because that's the proof points, the social proof, the business proof that you have a business. If you have an ecosystem or a constituency that can validate what you say you do, then you're real. And otherwise, if you don't have that, you're fake. We see it all the time. People say, I have this, but they're fake. They're faking it. This is where, go ahead, sorry. Yeah, I mean, so you can't fake community. You have to show it. You got to prove it. Just the proof is in the pudding, as they say. So, you know, when you get that, if you can't produce an ecosystem partner network, then you're not a platform. You're a company. And this is, I think, the challenge for HPE with GreenLake, with Dell, with Apex, certainly with VMware and it's cloud strategy. If in order to compete with the public clouds, and let's face it, they do compete with the public clouds. Yes, I know Matt Baker will say it's not a zero sum game. And I agree that it's not a zero sum game, but look at a dollar spent in cloud means it's not going to be spent on prem. And so you got to find new incremental growth like SuperCloud, but I will say this, if you look at how far behind from an ecosystem buildout standpoint, the traditional incumbent on prem incumbents are, it's a big deal. And this is where the Gen AI thing gets kind of interesting, right? On the one hand, the clouds have, they got the optionality, they have all the different Gen AI LLM partners, they have the building off a SageMaker, they've got the Silicon, they've got the database, the data platforms, they've got the governance partners. It's on and on and on. You look at what the on prem guys have, they basically, they're still at the reference architecture phase where they're announcing, like HPE, they've announced LLM as a service, which is great, not available to the end of the year. So they got a lot of work to do now. Here's what I'll say, they also have an advantage and the advantage is latency, right? And IP protection. So they don't have to be equivalent functionally to the cloud, but they've got to close the gap and they got to do it before the cloud figures out how to make things like outposts and Anthos as functional as what Apex and GreenLake envision. That's exactly why I think VMware's ecosystem is a huge deal for Broadcom and potentially it's OEM customers. So Broadcom makes money from OEM customers and end user customers through their acquisitions. So, you know, they're a chip, they're a semi-company, okay? But they have other businesses that they're diversifying into that are huge conglomerate now. So the brilliance- And they're enterprise, by the way, they're enterprise, they're not consumer. Exactly, enterprise with mainframe stuff are all the way into chips. If they're smart, they could be the white knight with VMware's ecosystem. By using that ecosystem as a galvanizing force for Dell's, the HP's, which by the way, they're customers. So again, that's, again, my weird vision of this is that if I'm Broadcom, I can bring an ecosystem presence instantly to my customers who are buying chips which have supply chain challenges, which are always price sensitive, always being smaller, faster, cheaper. Like you said, you got to be in that business, you can't fake that business. Broadcom kicks butt on that business. And you know what, Sean, it is like the fourth cloud. This is why Lena Kahn should just let the deal go through and get out of the way, because think about it, the ecosystem partners, they want an option other than AWS, Microsoft's competing with much of its ecosystem. Google's behind, even though Google's got great tech. VMware is really a great ecosystem partner and the ecosystem of, AWS's ecosystem wants, for the most part, maybe not the Databricks, or maybe not Snowflake who's born in the cloud, but much of the ecosystem wants VMware to be viable. And the regulators are making it like, well, what about that fiber channel over ethernet card? Broadcom could really screw people on that. So cares. I mean, it's just such nonsense. The bigger picture is how do you compete with the cloud, the big three hyperscalers, which have all this CapEx, all this money, and VMware is a viable competitor to those big three clouds. So that's the end of Lena Kahn. We got her into the conversation. So she's too busy picketing. So just reported she was picketing. She joined the Writers Guild of America and joined a picket line outside the View Studio in New York City. The red flags she sees in the showbiz. You're kidding me. So she's like now focusing on show business. So yeah. You gotta be shitting me. She's like the- You're making this up. No, I swear to God, it's an article on a substack called the Ankler. She essentially joined the Writers Guild of America in New York City for a picketing. She is. So M&A Future for Hollywood. I mean, they're on strike. I mean, she's just like anything to do with blocking it. So maybe she's distracted. VMware could sneak this through and say, see you later. I predicted on the podcast, by the way, they're gonna just get it done and say, oh, we'll pay the fine. I mean, what's the fine? What's the FC gonna do? This is a tough one, right? This is a tough one. Isn't the Writers Guild, I mean, I do sympathize with the Writers, but like part of their demand, isn't some of their demands like you can't use AI? Hello? That's never gonna happen, right? And so, I don't know how this one's gonna end. Well, the content rights are issues. But again, we said this on the pod, we'll say it again. There's three things going on right now that's historic, at least in my lifetime that I've ever seen. The innovation of the tech is exploding with AI, the infrastructure, next-gen cloud. The stuff that we can do right now as entrepreneurs and technologists to build new things is better than it's ever been in my lifetime, our lifetime. So it is an amazing, if you're in your 20s, you're in your teens and you're not riding this big wave, big surf, that's technology, then you're not gonna be an entrepreneur. But if you like that stuff, this is the perfect environment. The problem is there's two other things going on that are also blockers in the perfect storm here. That is legal issues arising, new rights to the content. If I use chat, where does that come from? There's a data supply chain, it's a software supply chain. There's a hardware supply chain. So there's a lot of legal entanglements involved in the new shit. The third one is compliance. So there's regulations, as you know, GDPR was done years and years ago. So you have all these old regulations that were built for older times. So you have a new renaissance here going on with technology and a Cambridge explosion at the same time. So huge tailwind for entrepreneurship, huge tailwind for industries, every single industry, Andy and Jesse said that he's exactly right. It is a massive builder culture, open source entrepreneurship. It is the best time to start a company without a doubt. The problem is that that could get screwed by these other factors that have nothing to do with that. That if they just threw it through the book away and rebuilt it, it would be okay. So the guild is protecting rights, but that was stuff that was written down from intellectual property rights from prior digital generations. FTC still is implementing the act from 1995. So the modernization of policy in society is not leveled up to technology, and that's a huge problem. Even the leaders in Silicon Valley and the tech industry are not amplifying that point and putting leaders in place that could help protect the people and the artists. Because the artists are right on one hand, they should be protected, but they don't know what the solution is. Yeah, and I don't blame the artists. I mean, the studio's made a shitload of money during the pandemic, and now of course they're all raising prices, right? You see all these, like everybody's raising prices. Like big, big price increases, and the court cutters are gonna get hosed, right? Because how many streaming services do you have? Do you even know? I buy them all. I got them all too. And I'm like, I don't know. I love it. Every month, I do too, but every month I get this bill. I'm like, jeez, I'm paying a lot. Did I even use Hulu this month? I don't know. So much to make a service like, you know, manage your subscription with a dash, single pane of glass, one service. Well, Dave, this is the point. I mean, I was clicking, my other TV was just Xfinity, which has its own smart TV, little arrow in it. I clicked on Tubi by accident. And I forget if Tubi was a rebrand of AWS Tubi owner. So it's Fox, I think, almost Tubi. Okay. They bought- Right, yes, Fox. You can't even keep track of it anymore. I think Amazon IMDB was renamed into something else, but the point is I clicked on it and I'm like, oh, this is cool, new menu. I'm just curious as in the media business with digital, I want to see what's going on in the layout. So, you know, my, everyone's yelling at me, get up, get up, either quicker. I'm like surfing around. I clicked on live TV. I'm like, oh, live TV. And in their menu, they're also getting over the top live TV, either over the air or somewhere else. And I watched the women's soccer game on a women's sports channel. So there's all these new channels opening up. So I think there's going to be a huge content explosion. Okay. Everything will be televised in the future. Everything from Little League to movies to tech, everything's going to explode with video. And there's no doubt in my mind that theCUBE will be the tech TV channel and others, and there'll be enterprise TV, there'll be analysts TV, there'll be everything on TV. Every vertical will have it, just like we see in sports. NHL's got a channel, MLB, NFL. So the focused vertical media is here and it's not going to go away. The Wall Street, that's an article, I read this the other day, I just scanned it. They're calling it streamflation, right? You got Hulu's going up to $17.99 a month. And Hulu's, freaking, Poo's okay. Max $15.99, Netflix $15.49, I think Netflix is the best, Netflix in prime, Disney $13.99, Peacock $11.99, Paramount $11.99, Apple TV $6.99, Apple TV, they got the shittiest platform, which is surprising to Apple. I mean, the thing's just, it's so non-intuitive. But Hulu at $17.99, you watch Hulu, I watch Hulu. It's just okay, you know, the content's just okay. Netflix is good. We're out of time, we're over, we're over the hours. I guess we got a lot of rants in there. We got a big week coming up, we got Google Next after VMware Explorer, and then we got some events going on after that and then the fall's here. I just got an interesting text from somebody, it's from Floyer. Apple is nearing three nanometer volume. So remember, Intel wants the leapfrog and go to two nanometer. Apple's nearing three nanometer volume production for iPhone, TSMC, only charges for working chips that are 100% to spec. So it's like, his point is, they're so far ahead in the race, anyway. Our might buy Intel out of bankruptcy, that's the controversial last tweet, is Intel Dooms. That's the question. Next, we didn't get to the Hashi Corp open source, next time we'll do that, we said we're gonna do that last time, so we'll see you next time. This episode 25, a historic live stream to Twitter, our first one a day, we got that working. We'll try to get spaces going next time, we'll do a simulcast there, we can always do YouTube. LinkedIn Live's a pain in the ass to work with, we'll try that another time. But 25 episodes, we're up to the right on audience. If you like the podcast, let us know, drop us a note. I'm John Furrier, Dave Vellante. Let us know how you think, share it with your friends, give it a like on iTunes and Spotify. Thanks for listening, and we'll see you next time. Go to siliconangle.com for all the traffic and all the content. See you next time. See you next week, John. All right, bye.