 This is theCUBE, live from the Moscone Center in San Francisco. This is SiliconANGLE's continuous coverage of VMworld 2010, now inside theCUBE. VMworld coverage, the CUBE here on location. We're on the scene and today we're on the sessions. I'm here with my co-host from wikibon.org. Dave Vellante, Dave, we're back. Ending a day of sessions, great conversations. We're live on the scene. And we have a unique guest here, Mike Neal from Microsoft at a VMworld show. So, Mike, welcome to the broadcast, because we're independent, we'd love to have you. It's like, hey, what are you doing here? What am I doing here? So, we have a booth here, albeit a small one, as the VMware will allow us to have. But for us, this is all of the customers that are here are Microsoft customers. And I represent Windows Server, I'm a GM for Windows Server. First and foremost for me is I want to make sure that Windows Server customers are having a great experience. Whether they're running it on VMware's solution or running on Hyper-B, obviously I'd like them to be running on Hyper-B, but customers are choosing to use these solutions, so we want to make sure that we're representing these technologies here. And we are allowed actually to talk about some things. We're not allowed to show our products here, but we are talking about Azure, because VMware really doesn't have any that competes in the public cloud space. All right, okay, so they don't let you, so basically you can allow them to come to the show, but you can't show anything. Yeah, the restrictions that we have is that you can't show competitive products in the booths. Okay, and you run the virtualization group, so. Yeah. Well, you're here with us now, that's good. Yeah, absolutely, yeah. So, I mean Hyper-B, we can talk about it, right? Yes, yeah. Okay, so, that's so good. If you want to come by the booth and ask questions, you're welcome to come by. We'll talk about Hyper-B, we just can't show it. The queue is sponsored today by VMware. Thank you very much, but you know, Microsoft, we won't discriminate. No, but it's just people talking about you guys. Obviously, you're in the discussion, Microsoft, in the enterprise deep legacy, huge presence, big cash cow, up and down in IT. So is VMware, so what are you guys doing different now with Hyper-B? What's your differentiation? How far has it come along? You're in production, are people using it in production? And take us through that story. Yeah, absolutely. So Hyper-B's been in development for quite some time and shipped first with Windows Server 2008 and we shipped the second version with Windows Server 2008 R2 and we're just about to ship another version with Windows Server 2008 R2 SB1. We have a lot of customers running it in production, running their production systems on it. In fact, we've got a number of customers who are switching from VMware to Hyper-B. They're finding it to meet their needs and they're very happy with it and obviously it's a significantly more cost competitive solution. So if you go to our website, you can see case studies of customers who are using it in their production environment from just about every demographic in the industry and a number of them are customers who are switching from their VMware solutions to Hyper-B. And so people look at IT as a building block, right? And VMs are a big part of that. Can VMs play with each other? I mean, obviously they talk about cloud, mobility, APIs, and you talk about some of the challenges that customers have that you're seeing and you're differentiating on. So one of the things that Microsoft took a different tack than say VMware did was we look at virtualization as really part of the infrastructure. We look at it as part of the operating system. It's a feature of Windows Server 2008 and it provides those capabilities to the customers regardless they license Windows Server, they can run virtual machines and they can use Hyper-B as that solution to do it. It allows them really to make their infrastructure much more agile. And so we've been talking about for, since last year even, IT as a service and really how do you deliver IT as a service? Provide the customer with the ability to be more agile to reduce their overall cost to be more standardized in the way they do things. And that's really a stepping stone, virtualization on premise, is a stepping stone for them to move to the cloud. So as they build those applications, then they can start to think about how do they move those into service providers. Microsoft, we have about 10,000 service providers that are part of our service provider licensing program and they sell Windows as part of their solutions. Everyone from small companies you probably never heard of in different countries to Amazon as a good example as one of the larger cloud vendors. And then of course, we have our public cloud offering with Azure. So I mean, obviously a lot of talk we've had this morning on theCUBE about cloud and desktop virtualization and VDI. I mean, that's your desktop. I mean, you guys invented the bloated desktop. I mean, in the classic PC centric and that was a revolution, right? So we know viruses and all that stuff. So, but that was a revolution and that spawned huge wealth. Microsoft, it's documented. Bill Gates is retired, 50 something now. What's the next Microsoft desktop look like and how do you service those IT guys as a service when everyone wants to just deploy images to 10,000 machines and really streamline that? So what's your answer to that? So I mean, when you look at any of the VDI deployments that are out there, what they're deploying is Windows. They're running Windows within those environments. A lot of our customers are moving very quickly to Windows 7. They're really enjoying that as a release and a lot of customers were on XP and so this is their opportunity to modernize their environment, take advantage of a lot of the capabilities that we have. By the way, we heard some customers talk about the Windows 7 upgrades in contact. We had Doug Westoff today from Brown Shoe Company and he was saying that when they went from XP to Windows 7 their VDI functionality shot through the roof. That's great. They loved it. Yeah, that's fantastic to hear. So regardless again, what technology they're using for their consolidation for their VDI solutions, those customers are running Windows within that environment. Now in the market, really the leader in this space is in desktop from Citrix and they've been a close partner for a long time. They were used to come on the queue, by the way. Oh really? Oh, that's too bad. Simon would have been fun, he would have had a good time. So. But we've worked really, really closely with them for years. He gives a good podcast, Simon. Oh yeah, yeah. So always entertaining. So we see customers who are moving their desktops forward. They're deploying the latest technologies. And for some of them, VDI is the right solution. Terminal server is a very good solution. Being able to do remote desktop consolidation, much higher density for some workloads. And then of course, the PC is still strong as ever and selling tons of those. I remember back in the day when Microsoft was really making a play at the service providers. This is way back in the 90s. Throwing money around at the ISPs, trying to get the footprint of the servers in there. And it didn't work very well, but you guys own the enterprise, right? But how do you look at the cloud service providers now, which are traditionally not in Microsoft shops, but are in a way because now the private cloud, the private cloud is moving, they want that, they got to deal with it. You're there, you're at the conversation. You are in, you're at the table. So you're a service provider as well? Yeah, absolutely. I think, like I said, we have tens of thousands of partners who are in our service provider program. They license Windows to resell to the customers through that program. So obviously there's lots of service providers out there that are selling Windows and selling solutions based on Windows and their providers. Exactly, yes, absolutely. And in fact, one of the more interesting ones that we've done recently was a pilot program with Amazon so that customers can use their licenses that they have, that they bought to run on premise as part of their EA agreements to be able to use those as part of their cloud offerings too. So we want to make sure that we're being flexible and letting people run their cloud offerings, et cetera. I mean, even VMware solutions with all of their partners, that's what the customer's running in those environments is they're running Windows in those guest environments. How do you handle the open conversation? Because everyone's open, right? Sure. Yeah, so everyone's open. Yep. Hypervisors are different. So we took the tact, we actually very early on joined the DMTF and have been a participant with VMware, Citrix, Red Hat, Novell, number of the other folks Intel, AMD, HP, Dell, those folks to really drive the set of standards for the management APIs for the hypervisor. And so from an openness perspective, we were one of the first ones to document our VHD file formats and we make that freely available. Anybody can use that. We've done a lot of work to make sure that the APIs for the hypervisor are available and are zero license again for that. And then we've also been working directly with the open source community. In fact, we have people who work for Microsoft that contributed to the Linux kernel that provide the capabilities for Linux to run on top of Hyper-V as well. So I think we've done a very good job of really taking a tact of being open with the community, working with the community on standards and then also making sure that the things that we've developed are available to others to be able to use. And that really helps our overall ecosystem. So, a lot of the customers I talk to say, hey, VMware has this killer hypervisor. I've just started to talk to more Hyper-V customers and they like the model, obviously. I mean, it seems to me that Microsoft is, your model works, right? It's got a blueprint and a roadmap that works very well over the years, right? And right now it seems like your packaging that you mentioned before, you see a hypervisor as part of the OS, VMware seems to be returning that favor in a way. They seem to be trying to make themselves into an OS. So that'll be interesting to watch over time. So, right, how do they make the hypervisor vSphere more ubiquitous? And so that's sort of an interesting dynamic. But one of the things that customers talk a lot about is the V-motion. And can you talk a little bit about what Microsoft's doing with regard to that type of functionality? So we actually have, as part of Windows Server 2008 R2, Light Migration Technology, which allows you to move workloads from one physical host to another with no downtime. Customers really love it to be able to provide high availability in their environments to do patching and maintenance without downtime in their environment. And we took the tactic of integrating it with our clustering system. So the same solution that you use for Light Migration, which allows you to deal with planned downtime. So if you know a priori that you're gonna do maintenance on a machine, you can move that virtual machine to another physical box and do your maintenance, is integrated with our clustering technology so if a machine should physically fail instantaneously, then we'll restart your virtual machines on other nodes within the cluster. And so you don't have to have a different infrastructure to have your clustered applications, along with your clustered VMs and to run Light Migration, you can have that all on one infrastructure. So you see the marriage of virtual machines and clustering technology coming together and where's that all go? That's an interesting vision. So it's an interesting thing to look at from a platform perspective because if you have an application that's really kind of a single instance application, if that application goes down, if that virtual machine gets turned off or something happens to it, then your customers can't do their work. Whatever it happens to be, loan origination, whatever the application might be, then your business is being hampered because the customers within your organization can't do what they need to do. And so we look at those types of applications and how do you protect them? How do you provide them the highest availability, make the system as resilient as possible, make the technology, the infrastructure as resilient as possible and things like Light Migration and clustering to help with that. But when you start to talk about the cloud, you're really talking about building an application on a platform that allows for scalability. And so the idea is that if any one instance of that application fails within your environment, then all you're doing is degrading the overall performance of it. And so you really start to build in that resiliency through redundancy. You have multiple instances of the applications running and any one failure isn't that critical to your infrastructure, it's just going to decrease your overall capacity. And this allows you again to be able to then also scale up to meet demand as demand spikes, et cetera. So that's really one of the big steps for customers is they start to architect their applications to the cloud and that's a big focus for us with Azure. And to the extent that you can, and that's only one part of the availability leg, to the extent that you can automate that and get humans out of the process that's going through availability as well. Yeah, so if you look at Azure as an example, you can scale up and down your instances of your application, you can do that all programmatically. So you can monitor whatever metric's important to you, what's the latency of your response to your customer or what the bandwidth or overall throughput of the system is and then increase the number of instances that you have in that environment as necessary. And then of course the Azure environment is built as a geo-scalable environment. So if for instance something catastrophic might happen and an entire data center goes down, we'll actually move all of those workloads to another data center within that geography and restart those workloads for the customer. Yeah, so Azure's interesting, big commitment to the cloud by Microsoft. Absolutely. I mean, there's no verification there. As Steve says, we're all in. You're definitely all in there. Is there any enablement in the mobile level? Because obviously Windows Mobile was a big thing and now you got the phone seven. Yeah. So is there any coordination with your group and the mobile team? Because the message you're coming out of here is we're going to create this hardened top. It's kind of like a Microsoft playbook, Maritz, you know. No stranger to Microsoft's strategy in the day. Absolutely. Kind of modernizing it. But you have this top end that's open you get application developers. Is Microsoft committed to being open there? Are these relying on Windows phone seven? How do you view that mobile ecosystem which is Macs and iPhones? Sure. So, you know, as examples, obviously our investment is in Windows Mobile and the technologies that we're providing there. We're actually building a lot of that technology around the same technology we use in the web which is Silverlight. And so for application developers that are developing, you know what I consider sort of social media or internet facing applications, the Silverlight technology is great. We're also using the same technology we use on Xbox for game developers, the X and A technology. And so we made announcements of all the games that are going to be available for Windows Mobile. So all of those technologies are backended by web services. All of those things are being developed. I got to ask you because obviously gaming is a great environment in the cloud, right? And the virtualization plays well with games because you can move things around, you got latency issues, lagging issues, as they say. Yep. You know, which is 15 year old standard language, I'm lagging. It's a big platform, very valuable. Yes. You know, Xbox is a huge success. Yep. Edge node in your cloud strategy, does virtualization, your virtualization play extend out to that environment? Yeah, so... And where does that touch the consumer? So if I'm going and building those applications and I want to write the app that runs in the cloud, I can run that on Azure. That's all running in virtual machines. And you know, really, I think a lot of people looked at the overhead of virtualization in the past as being significant. The work from Intel and AMD, Microsoft, VMware, Citrix, we've really gotten that down to the point where it's really not a significant impact for the scalability of these style of applications. And so it's really, one of the benefits of it is that scalability. You can create lots of virtual machines very easily, boot up all those VMs, and be able to deal with those spikes in demand. So when those new applications come out and those new games are released, there's always a huge tidal wave of interest as those things come out. And so being able to scale up and down is going to be critical to those developers. I think the industry has reached that critical mass. I mean, obviously you put something in between like a hypervisor that's going to create overheads, but the advantages now outweigh that. And you could probably tune the performance maybe a little bit better, but the business value that you're getting out of those other factors has exceeded. Yeah, more and more we're seeing people move larger and larger workloads into the virtual machines. But like I said, if you're just scaling out a large number of web farms, web applications, those types of web services will scale nicely in virtual machines. They're not large, 64 Proc applications. They're designed to be horizontally scalable. So they run great on a two-proc system and they'll run great in virtual machines in those environments. Really, the technical advances that Intel and AMD have done in the hardware have really reduced some of the major significant overheads. So we were a big proponent of the hardware-based virtualization. That's how we started out with Hyper-V. And so we use the VT technology and the AMD-V technology. And we work very closely with them on the MMU virtualization technology and now the IO virtualization technology is coming to market as well. So you'll see those technologies really reduce the overall overhead of the hypervisor and really improve the scalability and capabilities of those virtual machines. So Mike, what's on your to-do list, huh? GM, show a little leg for our audience. What's going on there? What's going on there? So one of the things that we've got actively going on right now, betas are available so customers can take a look at is Windows Server 2008 R2 SP1. And it has two really great, it's got a bunch of interesting fixes, features, et cetera. But it's got two really great new things in it. One is we provide our dynamic memory capability. So this really allows us to very efficiently use all the physical memory in the system, spreading it dynamically out amongst all the virtual machines that are running. Really great for customers who are doing VDI where you typically have desktops that are idle from time to time as the user maybe walks away from their desk for a while or whatever happens. And that allows us to move that memory to workloads that are much more active and be able to improve the performance of those workloads. And then the other area that we invested in which is again related to VDI is our remote effects technology. And this really allows you to have that very high fidelity environment that you can remote a full Windows 7 desktop experience with all the user interface that you'd expect on your local laptop. And you can also do all the media. So high definition video and audio along with that. And so really providing a substantially improved user experience for the customer so that they really get the same fidelity that they have in the desktop environment. And the advantage of getting, one of the customers said, hey, you get a new desktop every day, right? Whereas previously the differences in graphics and things like that were enough to say, no, I want my laptop. And it's an important thing. I think for customers that personalization that they do, the way they set up their system, making sure that they have access to that, being able to have everything from the background picture of your kid to how you set up your applications and your start menu so that you're productive in every day. And if you're in an environment where your virtual machine's kind of getting wiped out and you're really losing that customization that you've done, you're just not going to have as a nice of experience in the environment. So we've done a lot of work in the system to really provide those capabilities. And again, all of that technology is agnostic to whatever virtualization solution you're using. All right, we're here with Mike Neal, GM of Microsoft. I know we got to wrap, John. Yeah, we're going to wrap up for the day. Mike, thanks for coming on board. We're glad to have you from Microsoft because we are independent, siliconangle.com. We're covering all the angles at VMworld 2010, Dave Vellante, wikibond.org, Mike Neal, GM of the server group, virtualization. Thanks so much. Thank you. Appreciate you coming on. We'll be back at theCUBE. Absolutely. Thank you.