 Okay, welcome back, everyone. This is SiliconANGLE and Wikibon's exclusive presentation. Special Cube appearance at AT&T Park in San Francisco, California, home of the San Francisco Giants in a variety of other things. They've played soccer games here, they've played football games here, and they're going to have a concert here tomorrow night for VMworld 2013. I'm John Furb, joined by co-host Dave Vellante, and special presentation by NetApp here, their customer appreciation party at VMworld. Great venue. Dave, I've got to say, isn't this amazing how we, we always wanted to be on the field with an anchor desk. We actually have a desk. I love this. The fact that we got the kind of internet we need, we're right here, right behind second base, John. It's fantastic. I feel like calling a game right now. I just, I love this venue. Dan Timko is here. He's the president and CTO of Searedy. Dan, welcome to the Cube. Thank you, thank you. So, president and CTO, that's an interesting mix. And so to start with, tell us a little bit about, about Searedy, what you guys do, and then we'll get into it a little bit. Sure, so we're a class service provider, which is why we can be a president and CTO at the same time, because we're a very technology focused business. So we're a channel-only provider. So we only work through channel, bar, managed service provider, those types of companies to provide solutions back to the end user. We do both public and hybrid cloud scenarios, as well as a lot of disaster recovery as a service solutions to protect customers on premise environments. Yeah, so we talked last night, I was at the analyst center, and you were mentioning, as well as your colleague, about the imperative for hybrid cloud, that it's really, I was just asking my previous guest, do you think 2014 will be the year of the hybrid cloud? I guess from your standpoint, it's already started. So I wonder if you could talk about that a little bit, because we hear a lot of the messaging. Sean, of course, we've been hearing that for the last three or four years, but Dan, I wonder if you could talk about, you know, what's real from a practitioner standpoint? What's actually happening in the field? So I think a lot of it depends on the entity, right? So the customer organization, we see, you know, the SMBs are going all in, right? Because they don't have enough of a workload to do hybrid, so they'll either keep it private or go all public. You get into more of the mid-market and the enterprise customers, and they're playing more in hybrid. They've got a good private base right now, they're starting to test the waters, move workloads up, and do specific things with it. Like I mentioned last night, good use cases, companies who have compliant regulated environments, so say a PCI or HIPAA workload in their environment, they'll move that to a cloud like ours where we can handle the PCI and HIPAA compliance, so they take that whole scope out of their private environment, which can reduce a lot of audit costs and things along those lines. So we're seeing a pretty good adoption of hybrid, hoping, obviously, it continues. That's our goal in business, so every sign seems to point that way. Yeah, so talk a little bit more about the drivers in your business. Where the tailwind's coming from, and where are you headed? They talk about skating to the park. As the president, you got to be looking forward, as well as capitalizing the momentum. So where's the momentum coming from and where are you headed? So we made a strong investment early on when we started around building a compliant environment. So from the start, being PCI and HIPAA compliant as an environment was a big driver for us. We knew having an environment like that would be a big benefit to a lot of organizations who were staring, especially around HIPAA with high tech and some of the omnibus rules coming down, they weren't going to be able to address them, address those themselves in their own environment. So that was a good tailwind for us with meaningful use, a lot of the regulations and laws that came around that to push workloads off to someone who can handle them better than you could do in-house, because obviously that's what we do as a business. That's our core to handle that type of environment. So there's a lot of that. I think we're starting to see another big push coming from the VAR businesses out there, guys who are traditionally selling big iron, big deals, up front getting a big check and walking away. Their customers are starting to ask about cloud and they're starting to transform their businesses to have that answer. And so we partnered with a lot of VARs who are trying to integrate cloud services into their offerings to their customers. And again, it's a hybrid. They're still going to sell on-premise solutions and they're going to sell off-premise and make them work together with that. That's their value add. Yeah, talk about the complexities of the challenges around it. It's hard to go cloud when you got to put legacy functionality and compliance. What's the critical things that need to get done to go into hybrid knowing that, hey, I have some legacy. I don't mind being on-prem and being on data center. Start with a fine data center. Is the data center still on cloud? It'll still be part of it. But what are some of the challenges? Why is it so hard to balance compliance and hybrid? I think the biggest challenge is very few people actually know what runs in their data center and what's there and what the dependencies are. So half of the time that the biggest challenges are around understanding for a given workload, what does it depend on in the environment? So you can map that all the way back to your database and application, domain controllers, all those things. So if you choose to move a single workload, I mean, you might consider that a container, but then when you get it off in the cloud, you realize, oh, that thing points back to 10 different things that are still in my private cloud. I don't have the connectivity. So there's a lot of upfront evaluation that needs to go in for a truly successful hybrid. What about data protection and data privacy? It's always concerns around data and reporting. I mean, what's that? So thank you, Edward Snowden. We'll go ahead and say that, right? Because that's only kind of spiked things up. There's always been that concern of, well, you're a cloud provider. Why should I trust you? We go to a lot of links to assuage those through third-party audits along SOC2, right? All those things that we do to provide that attestation back to our customer that we're doing our diligence to protect our data. But now, right, the question is, so hey, have you guys been contacted by the FBI or NSA? Are you part of that program? Wink, wink, nod, nod? And of course, right, how do you answer that? They don't live here anymore. Exactly, right, right, right. So, give it to the office. So we can bring in other technology. I think, well, again, one thing I brought up last night that we like to bring in, whenever there's a highly sensitive workload to come onto our platform, we have encryption offerings where they can be key escrowed, right? So we don't have access to the keys. The customer maintains key management. It runs on our platform. It can only be decrypted if the certain rulesets match. I prefer when people bring that on because, A, as a cloud provider, it reduces the analyability for me when it's on my platform. And for the customer, they have that confidence that we can't access their data just by pulling a hard drive or a virtual hard disk away. So what proportion of your customers actually take advantage of that, Dan? At this point, I'd say 15 to 20%, and that's growing. And do you feel like the recent discussion that's come about as a result of Prism and the NSA discussion is affecting that? I mean, you're getting certainly more questions. Did you expect that it's going to drive more demand? Yeah, our expectations is that's going to increase. I think we saw a little bit of a pause. I think certain projects maybe got held up a little bit, but in the end, it comes back to a business decision to around efficiencies and cost savings and flexibility for the business. So things are still going to move to the cloud. I don't think there's a long-term impact. Do you think that the Snowden leaks are going to increase more storage and storage, or force people to let delete things faster? People don't delete anything. I mean, that's a great thing for a company like NetApp, but people talk a lot. They talk a big game about archiving and data retention policies, and we see very few people actually implement that. So yeah, for us, we see most customers, they're going to grow continually in storage. Very few actually have a mature data retention policy and take care of that. And they have multiple copies, too. They don't even know what to delete if they want to. Exactly. We talked about that, Dave. Which goes back to mapping what are the dependencies and what do they actually have in their data center? So, Dan, your body language about this conversation last night was pretty explicit. I mean, at the same time, though, you sort of alluded to, you know what? Some customers may be better up because they weren't asking the hard questions before, and there's a renewed awareness. So, you know, since we have you inside the queue, I want to ask you, so what's your take on all that? Was it just a good thing for customers, or is it, you know, a bad thing or a scary thing? Well, so I have a security background, so for me, I see it as a good thing. And it kind of validates the whole, what we started with. Like I said, we started this. Security and compliance were our number one priorities. We had customers that were being financial and healthcare. So now, other customers that didn't have a legal reason or a credit card processing reason to do these things are starting to ask those questions. I think in the end, it's what people should be doing anyway, around encryption and key management. These are things that are just best practices that a lot of people weren't doing, and hopefully now, we'll start doing. Yeah, so, I want to talk a little bit about, you know, NetApp, we're here at this event. What are you doing with NetApp? How has it enabled your business? Are you able to, have you changed the way in which you approach your partnerships in the last couple of years, and are you able to monetize those relationships in any new ways? Yeah, so when we moved to NetApp a few years ago, it was a very big improvement for us. Don't need to mention, obviously, where we were before that, but moving to a FlexPod-based environment, right? We're running UCS on NetApp environment through using VMware as our cloud platform. A lot of big advantages. First, and the joint tack with support, big thing for us. We're kind of through with finger pointing, a vendor, storage, compute, virtualization layer, all that, one place to call to get everything done because everything is converged now, right? That's not just a buzzword, everything all is together in a cloud environment. So that was a big advantage for us. I think the clustered data on tap release was great for us because we're a cloud provider, people expect uptime, right? We can't get around with scheduled maintenance windows where there's an outage. So having the ability to do the non-disruptive operations, bring in a new cluster array, seamlessly move things over without an impact to the end user and we can perform maintenance and upgrades and add in new blocks of storage without customers knowing anything ever happened. That's huge for us. So yeah, our partnership with NetApp has been a big enabler to our growth. Dan, final question. We've got the one minute hook here. What's your outlook from your standpoint, not so much NetApp, but the industry. What are you most excited about right now with cloud? From what you've learned and what you see around the corner, what are you most excited about? I think there's an amazing opportunity in cloud right now and people ask me, hey, VMware is now in this game. Is that, are you worried about that? Microsoft came out with Azure and to be honest, when you look at it, the market opportunity for cloud over the next few years, it's enormous and there's a lot of room for people to do what they do really well and be very successful. I think that's the most, probably the most exciting thing for me. Deliver value. Deliver value. Exactly, do something great and you'll be successful. So you have differentiation there and even throw in Amazon, Google, Azure, whoever you want. Is the value that you bring in your specific niche as well as your belly to belly relationships is that right with the channel? Exactly. Because they are willing to be flexible, right? So we treat our partners and customers in a lot more of a closer relationship than say a VMware or an Azure or an Amazon can do. So that's a big thing for us, right? We want to maintain those close relationships and be more of a boutique shop and do things that are right for our customer and partners. Dan Kimco, customer of NetApp out in the field doing some great work with cloud. Thanks for coming outside this special edition of theCUBE. This is SiliconANGLE's exclusive special presentation live in San Francisco at VMworld 2013, NetApp's customer appreciation event. This is theCUBE live on the field behind second base at AT&T Park, home of the San Francisco Giants. We'll be right back with our next guest after this short break.