 Live from Las Vegas, it's theCUBE, covering Dell Technologies World 2018. Brought to you by Dell EMC and its ecosystem partners. And welcome to our live coverage here, day three of Dell Technologies World 2018. We are live in Las Vegas. Hope you've been with us for the first two days. We have a great lineup here for you on day three. I'm John Wall, as long as Stu Miniman. Glad to have you along, Stu. It's always great to work with you. Thanks, John, same for me. Good week so far for you. It's been excellent. My voice is holding up. It's been a long week, but yeah. You're a busy man. I'm excited to get all of this, and heck, I'll be seeing Dan again next week in the next show. Dan McConnell's becoming like, he's like not even an annual visitor, you're like a bi-monthly visitor here on theCUBE, right? VP of Converged Platforms. It's the fifth time you get a free sandwich, so. Yeah, that's right. I got a punch card. I got a slide and then get a punch each time. Nice to have you, Dan. Nice to have you back. Good to see you again. All right, let's just talk about the show. First off, here we are, day three. We talked a little bit yesterday about customer discussions and conversations, so you've had a little bit of time to soak this in and what you've heard from folks and what would be your takeaway here? Sure, I may spin this one a little bit. No, it may have an angle here. Tremendous interest in HCI, and I'm not saying that just because I'm in HCI. That's your world, right? No, but it's a lot of good solid feedback from customers. It's starting to shift more into mainstream, right? So as we see customers deploy it, more workloads get deployed on top of it, there's a tremendous amount of interest in HCI. When we look at all the graphs of customer interviews we're doing and analyst discussions we're doing, HCI is right there at the top of the list in terms of subjects that we're talking about. Can you quantify that as our numbers that are all out there floating around in terms of growth, in terms of what? Oh, from the HCI side? Yeah, I mean, Picker, most analysts will agree it's about 70 to 80% growth year-over-year and I'd say from a Dell perspective we're doing 138%, so we're actually growing faster than market. A lot of that's due to, we've got one, we've been in the HCI business for a while, two, we take a portfolio approach, right? There's never any one-size-fits-all, so we actually take a portfolio approach to HCI. We've got what are multiple different consumption models, one that is an appliance. This is the server, the hardware, the software, lifecycle managed in an appliance and then the next layer is what we call rack scale. Obviously HCI puts some pressure on the network, right? High network dependency, rack scale, what rack scale does is include the networking components in that engineered system attribute. So, pre-tested, pre-designed inclusion of both the physical as well as the virtual network and across both of those consumption models we have a stack that is very VMware-centric, right? VxRail, VxRack, SDDC and we have a stack that is what we call open HCI, supports multiple hypervisors. That is XC series on the appliance and VxRack flex on the rack scale solution. So, portfolio approach, cover the whole market and we're really seeing it blow up. It's great. Dan, it's interesting. I think back to when people were first trying to wrap their brains around this whole HCI thing, it was like, oh, okay. I took server and storage, kind of smashed it together, some software maybe in there, but it was, oh, this is, you know, small end thing. It's, you know, maybe four nodes, maybe getting to eight nodes, but you talked about the VxRack flex, which we've been watching Scalio since before the acquisition and all that solution, much larger configuration. Some people said, oh, it's not even HCI because I've talked to some customers. Well, I can do a storage only configuration or I can do a full hyperconverged configuration. We've seen maturation and some segmentation in the marketplace, so, you know, bring us inside that from the flex business as to what you're seeing, what differentiates it from some of the other options. Absolutely. I'd say it's flexible. So, and dog barking next door. Dog barking. I'm on cue. On cue. Nice. There he is again. It's so. There's actually, it's one of the philanthropic Dell outreach programs, it's Comfort Pets, or you know, therapy dogs. Therapy dogs. We're right next door. No reflection at all on the guests or the program or whatever. They're in day three too. It's been a long time. We're getting punchy, all right. Back to flex. Just explaining. So, you know, back to your point. Flex is flexible. We've got customers from, you know, four nodes all the way up to over, you know, large enterprise customers over a thousand nodes. It is, you know, matter of fact, about 45% of our business comes from Fortune 500. So, when you think HCI, like you said, HCI started in what was, you know, VDI, right? We're going to pick a workload. VDI is very scale, you know, kind of linearly scalable. HCI was a good fit. Nowadays, it's multiple workloads, right? That flexibility, agility, ease of scale. People are putting more and more workloads on top of it. The VXRack Flex, we've got, you know, when you talk about scalable, up to a thousand nodes, literally 30 million IOPS, right? So, performance, I think we got it covered. So, it's definitely maturing. Some of those larger customers are running, you know, anywhere from database all the way to mission critical applications. Yeah, Dan, I actually did a case study of one of your larger global financial companies a few years ago. Want you to talk about what they saw this solution at. This was a foundation for their private cloud. You know, they use in certain regions, public cloud makes sense, but in a lot of areas, this is the foundational layer of private cloud. A lot of time people, oh, HCI is just, you know, it is what it is. It's some boxes and some software, but, you know, talk about the private cloud angle. It's, and this customer, you know, it's actually a very interesting storyline. They started off doing what we would call do it yourself, build your own, and love the technology as is predominant with HCI, continue to scale, right? So, bought a lot, added on, added on, and as they continued to add, continued having discussions with them, and they actually, you know, love the technology, would love to be able to automate more, would love to spend less time setting it up as it comes in. So they actually moved up that consumption pyramid into VXRack Flex, which comes, as opposed to do it yourself, comes, you know, shrink wraps, roll it in. So they actually designed their infrastructure, their data center around what they call pods, right? So fairly large pods, but they've changed the consumption units on how they consume IT. They'll actually wheel in Flex pods, and that's their new unit of consumption. And now, a Flex pod is, is large. Not to be confused with another product called Flex pod. Oh, gosh, yes. VXRack Flex pods. Yes, absolutely. We unfortunately have run out of words in our industry here, so, yeah. Oh, we can, you can, yeah, I'm sure you'll, you'll find something in a vernacular that will fly there. Yeah, we'll try and burn that one for my memory. But, good catch. So what, so that's one use case. I mean, just in general now, I mean, so what is the value prop for a customer, you know, today, when they, as opposed to what kind of flexibility you're giving them, you talk about performance, but how are people actually putting it to use for them, and what are they doing better, do you think, because of that? Sure, and I'll start off one with, which is an architectural discussion, and I'll crunch this down pretty small. In the beginning, there was, there was gas, direct-attach storage, and it was fast, and it was easy to manage, as long as you had to manage one. And you get, you know, a hundred units, and it was siloed storage, and it was hard, so, you know, the world came up with sand. It's consolidated storage, it's great. I can carve it up, I can manage it from one place, and then we came up with Flash, SSD, blindingly fast, and that storage controller started to be a toking point, so we moved the storage back into the server, Ally HCI. Or actually, we called it server sand for that specific reason. It's server sand, exactly right, exactly right. So, initial ventures into some of HCI, you can only scale the storage, or only scale the HCI clusters, as big as one given cluster. So, you started building somewhat of silos of HCI. One of the beauties of Flex and of VxFlex OS storage software is it can scale across multiple clusters. Those clusters can be VMware, they can be bare metal, they can be Linux, right? So, you start to gain all the advantages of HCI, flexibility, agility, kind of incremental scaling, pay as you grow, with all of the advantages of storage consolidation. I no longer have pools of siloed storage, I can carve up ones as needed, when needed, I can manage it all as one combined storage pool. So, from a Flex perspective, it's got some pretty nice architectural attributes, which give you the best of HCI and agility and scale, as well as storage consolidation. So, we're seeing a lot of success there. Yeah, Dan, I hear things like open, flexible, some of those environments, and I think about the service providers and requirements that they have for how they need to simplify their environments, super conscious on cost. How's this been doing in the service provider market? Absolutely, yeah, it's funny you bring that up. We actually talk internally, we've got a service provider team inside Dell, they focus on servicing the large telcos and other service providers. And we've noticed that they're underlying infrastructure is very, very similar with Flex. So, we're in discussions to see how we land what they do on top of what we do as a standardized offering. But even right now, a lot of our customers are in the service provider space, that large growth flexibility and some of the underlying storage stack has multi-tenancy capabilities where you can carve up and isolate that lends itself very, very well to service providers. Okay, so, Dan, just for people that know ScaleIO, anything new that they should be understanding, understand it really went to, it's this packaging as like a hardware model, organizationally, it lives under the server team now, I believe it is. Yeah, absolutely, so two things there. One, organizationally, all the HCI stuff came in up under Ashley Grokawala, so it came in up under the server side. And then, so, ScaleIO is up under Jeff Boudreau under Danny and Barr, it's storage stack, it's in under the storage division. We worked very, very closely together. And so, the second thing that's happening, there's a, as we've won, we've been in the HCI world for a while we've quickly determined we can drive much better customer experience, much better customer outcomes as we lean more towards an appliance or an engineered system versus a do-it-yourself kind of model. So, with ScaleIO, what we're trying to do is push it more into an appliance model, push it more into rack scale model, VXRack Flex. So, there's a outbound shift away from kind of what was ScaleIO as a software only and into more of an engineered system appliance offering. So, with that shift, you'll see a rebrand from ScaleIO to VX Flex OS. It's just a rebrand of the software. So, I'm glad Stu talked about organization. I mean, because you had kind of reorg, not too long ago, and so we had Ashley on yesterday, we talked to Jeff yesterday as well. So, I mean, just from your perspective, I mean, how, now that you've had a few months, right, to settle in, find your groove, how much of a difference you think, as far as customer facing, is this making or in terms of responding to those kinds of needs and those desires? Sure, you know, sticking HCI with the server team has an awful lot of synergy, right? Obvious compute-centric scale from a business scale perspective. So, there's an awful lot of goodness in living in that same organization. Ashley's done it pretty well to make sure we, there's a lot of alignment, but we're also keeping a lot of the engineered system special sauce focus on the HCI side. So, we're able to, one, better leverage a lot of the, what I would call supply chain scale, right? The processes and go-to-market capabilities of an engine that is built around hundreds and thousands of units, right? That stretches across services, that stretches across factor and supply chain. Obviously, we want to drive HCI, we want to drive HCI into mainstream and scale. Sitting right there in the server organization, they do scale, right? So, a lot of good learnings, a lot of good synergy and leverage across teams. It's coming together. It is, absolutely. Yeah, nicely done. Thanks for joining us again. Good to see you guys, you're going to see each other next week, I said? Yes, right. You've been out of New Orleans, is that, yeah. Yeah, that's a- All right, enjoy, stay out of trouble, both of you. Absolutely, I'd, you know, one week- Vegas, one week, New Orleans and X, that's a recipe for interesting times. Yes, that it is. Dan McConnell, thanks for being with us here on theCUBE. Thank you, thanks for having me. Back with more from Las Vegas, right after this, you're watching theCUBE from Dell Technologies World 2018.