 Live from San Francisco, it's theCUBE. Covering IBM Think 2019, brought to you by IBM. Hello everyone, welcome back to theCUBE's live coverage here in San Francisco. We're live for IBM Think 2019. theCUBE's exclusive car, John Furrier, Stu Miniman, our next two guests are the cloud gurus at IBM and VM where AJ Patel, Senior Vice President General Manager cloud provider, software business unit. Good to see you again. And Arush Kramma, General Manager of IBM Cloud. Guys, thanks for spending the time. You guys are the cloud gurus. Here to share with us what's going on. Thanks for having me. A privilege. Obviously cloud has been around. We've seen the public cloud momentum. Hybrid, certainly been around for a while. Multi-cloud's a big conversation. People are having. Role of data, and that is super important. AI anywhere, you guys at IBM have announced. You guys have been on this. It's a hybrid journey on a while. Hybrid journey for a while, on premise. Yep. AWS on VMware, all this good stuff's happening. This is the customers want this. So talk about the relationship you guys have with IBM. You know, the broader VMware-IBM relationship over nine, 10 years old. I had the privilege of being part of the cloud the last couple of years. The momentum is amazing. Over 1700 plus customers, and these are enterprise customers. Not your one node trial customers. These are real mission critical enterprise customers using this at scale. And the number one thing we hear from customers is, make it easy for me to leverage cloud, right? Operate in a world where I'm using my on-prem and my public cloud assets. Make it seamless, and this is really what we've talked about a lot, right? How do we provide that ubiquitous digital platform for them to operate in this hybrid world? And what privilege do you have IBM as a great partner in this journey? All right, so talk about the IBM cloud. Ginny Romani said on CNBC this morning, we saw the interview with my friend John Ford over there. He said, AI anywhere means you can run on any cloud, Watson, with containers. That's cloud DNA. He's sitting in the cloud with Kubernetes and containers is changing the game. Now you can run a lot of things everywhere. This is what customers want end to end from on-premise to wherever. How has that changed the IBM cloud posture, its products, can you share a little bit of that? Yeah, absolutely. So look, I mean, people have their data in different places and as you know, it's really expensive to move stuff around. You got to make sure it's safe, et cetera. So we want to take our applications and run them against the data wherever they are, right? And when you think about today's landscape in the cloud industry, I think it's a perfect storm, a good perfect storm in that containers and Kubernetes, you know, everyone's rallying around it, the ecosystem, the consumers, the providers. And it just makes us easy for us to take that capability and really make it available on multi-clouds. And that's what we're doing. Talk about your joint customers because the VMware has a lot of IT operators been running virtual machines for a long time. You guys have been big supporters of that and open source. That really grew that whole IT generation that we're seeing with cloud. Talk about your customers, your momentum, how you guys are, just ballpark, how many customers you guys have together, and what are some of the things that they're doing? Right, so this is a really interesting story. I was actually away from IBM for just over two years, but one of the last things I did when I was in IBM the first time around was actually start this VMware partnership and seeded the team that did it. Coming back, it's really interesting to see the uptake it's had. We've got like 1700 customers together, over 1700 customers together. We've moved tens of thousands of VM workloads, and as Ajay said, we've done it in a mission critical fashion across multiple zones, across multiple regions. And now we want to take it to the next level. We want to make sure that these people that have moved their basic infrastructure and their mission critical infrastructure across to public cloud can extend those applications by leveraging the cloud-need applications that we have on our cloud. Plus we want to make it possible for them to move their workloads to other parts of the IBM ecosystem in terms of our AI capability. I think one of the things we found was the notion of modernize your infrastructure first, lift and then transform is starting to materialize. And we used to talk about this as really the way the best way to use cloud or use hybrid cloud was start by just uplifting your infrastructure. And whether it's Westpac, you asked for some customers, Westpac's a great example, I think they're talking about it in the Harish and I joint presentation tomorrow. Or you look at Kaiser, who's going to be on stage tomorrow. We're seeing industries across the board are saying, you know, I have a lot of complexity, sitting on aging hardware, older versions of infrastructure software. How do I modernize a platform first, lift and shift it to leverage the cloud, and then I can transform my application. Using more and more portable services. Kubernetes has to provide us kind of that infrastructure portability. But what about my data, right? What about if I can run my application with the data? So I think we're starting to see the maturing of the use of cloud based on workloads and leveraging the assets we have. A.J., I wonder if we can dig a level deeper on that, because I think back to 15 years or so ago, it was VMware allowed me to not have to worry about my infrastructure. My OS and my server that I was running on might be going end of life. Well, let me shove it in a VM and then I can extend the life and then I can manage how that happens. Of course, the critique I would have is, oh, maybe it's time to update that application anyway. So I like the message that you're saying about, okay, let me get to a process where I'm a little bit freer of where, and then I can do the hard work of updating that data, updating that application. Help us understand how that happens. It's no longer by just unlocking the compute, right? Which was virtualizing the server. It's what about my network? And we talked about earlier, do I need a software-defined network? Well, the reality is everything is going programmable. If you want a programmable infrastructure, it's compute network storage, all software-defined. So the building block for us is a software-defined data center running on the infrastructure that IBM provides. 60-plus data centers, bare metal at scale, elastic, and then layering that with ICP, IBM Cloud Private, whether it's hosted or on-prem vSphere, gives you that full stack that Nirvana, the people who talk about it, a supportable stack that you can talk about. Right, and adding to what he said, right, you said it's not about just moving your old stuff to the cloud, absolutely. So as I said in one of the earlier conversations that we had, we have a whole wealth of new services, whether it's Blockchain or IoT or the AI that you spoke about. Leveraging those capabilities to further extend your app and give it a new lease of life to provide new insights is what it's all about. That's great because it's one thing to just say, okay, I get it there, can I get better utilization? Is it to change my pricing? But it's those services and that's kind of the promise of the cloud is if I built something in my environment, that's great and I can update it and I can get updates. But if I put it in your environment, you can help manage some of those things as well as I should have access to all of these services. IBM's got a broad ecosystem. Can you give us, what are some of the low-hanging fruit is to people when they get there, that they're unlocking data, that they're using things like AI, what are some of the most prevalent services that people are adding when they go to the IBM cloud? So when you look at people who first move their workload to the cloud, typically they tend to dip their toe in the water. They take what's running on prem, they use the IS capabilities in the cloud and start to move it there. But the real innovation really starts to happen further up the stack, so to speak, the platform as a service, things like AI, IoT, Blockchain, all the things that I mentioned. So a very natural next movement is to start to modernize those applications and add to it capabilities that it could never have before because it was built in a monolith and it was on prem and it was kind of stuck there. So now the composition that the cloud gives you with all of these rich services where innovation happens first, that is the real benefit to our customers. Harris, you said you took a little hiatus from IBM and went outside IBM. Where did you go and what did you learn? I thought it was at Goldman, JP Morgan, where were you? So it was a large bank, you know, I'm not allowed to say the name of the bank. One of those two. It was a large bank and it was in the US so that narrows down the field somewhat. What was it like to go outside now, come inside? You see DevOps full, cutting edge bank. Now you got IBM cloud. You feel good about where things are? Yeah, you know, if you look at what a lot of these banks are trying to do, they start to attack the cloud journey saying we're going to take everything that ran in the bank for years and years and years and we're going to make them microservices and put them all on public cloud. And that's when you really hit the 80, 20% problem because you've got large monoliths that don't lend themselves to be refactored and moved out to a public cloud. So again, enter Kubernetes and containers, et cetera. These allow you a way to modernize your applications where you can either deploy those containerized, pay-as-you-go type models on-prem or on public. And if you have a rich enough set of services both on-prem and on the public cloud, you can pretty much decide how much of it runs on-prem versus how much of it runs on the cloud. It's a deployment choice. It's a late binding deployment choice. So basically what you're saying is, see if I get this right, I want to get your reaction to this. You don't have to kill the old to bring in the new. With containers and Kubernetes and now service measures around the corner, you can bring in new workloads, take advantage of the cutting edge technology and manage your life cycle of the workloads on the old side or it just can play along. Yeah, exactly. So I think what we're finding is, we moved from hybrid being a destination to an operating model. And it's no longer about doing this at scale. Like, am I multi-cloud? Any given application is tied to a cloud or a destination. It's a late binding decision. But as an aggregate, I may be using multiple clouds. So that model we're moving to is really about allowing developers to do a workload-centric and services-centric to see where do I want to run an application. Okay, one of the challenges with multi-cloud is there's skill sets I need to worry about and it can be complex. I want to touch on three points and I'd love to get both of your viewpoints. Networking, security and management. How do we help tackle that and make that simpler for customers? Yeah, sure. So I think when you think about clouds, public clouds especially, it's beyond your data center. And the mindset out there is if it's beyond my data center, it can be safe. But when you start to build those constructs in the modern era, you really do take care of a lot of things that perhaps your on-prem pieces did not take into consideration when they were built like many decades ago, right? So with the IBM public cloud, for example, you know, security is at the heart of it. We have a leadership position there. One of the things that we've announced is key protect for not only VMware, workloads, vSAN, vSphere, et cetera, but also for other applications making use of our public cloud services. Then when you talk about RZ, you know, we have a hardware as a security module which is FIPS 140 level two or Dash two level four, which nobody else in the industry has. So when you put your key in there, only the customer can take it out, not even us as cloud service providers can touch it. It will basically disintegrate, you know, so to speak. A.J., talk about VMware's customer base inside the IBM ecosystem. What's new, what should they pay attention to as you guys continue the momentum? So I think if you look at the last two years, it's been around what we call these larger enterprise dedicated clouds. The exciting thing in the horizon is we're adding a multi-tenant IaaS on top of this VMware dedicated. So being able to provide that breadth of, you know, access thing, whether it's dedicated multi-tenant public cloud, IaaS fully programmable allows us to go down market. So I expect the customer kind of go up, being able to kind of consume it on a pay-as-you-go basis, leveraging kind of multi-tenant with dedicated, whether it's highly secure or for dev tests or other use cases kind of. We're going to see a larger set of use cases that I'm most excited about. So the bottom line, I'm the customer, bottom line me. What's in it for me? What do I get? Yeah, for the customers with the safest choice, right? It's the mission critical secure cloud. You can now run the same application on-prem in a dedicated environment and public cloud on IBM or in a multi-tenant world. You can mix and match. On the cloud side, I can take advantage of all the things you have. And can I take advantage of that Watson AI thing that Rob Thomas has been talking about? All that good stuff. Oh yeah, absolutely. And again, you know, the way that we've built ICP4D, which is IBM cloud private for data, you know, it's all containerized, it's orchestrated by CUBE. So you can not only build it, you can either run it on-prem, you can run it on our public cloud, or you can run it on other people's public cloud as well. Irish, for customers, for people that are looking at IBM cloud and re-evaluating, you guys now, again, say, or for the first time, what should they look at? Cloud private, what key thing would you point someone to look at IBM? If they weren't going to inspect your cloud offering? So again, it's back to my story in the bank, right? It's, you can't do everything in the public cloud, right? There are just certain things that need to remain on-prem. And will be so for the foreseeable future. So when you take a look at our hybrid story, the fact that it has a consistent base on which it is built, and it is an industry standard open source base, you know, you build your application to suit the needs of an application, right? Is it low latency, put it on-prem? Do you need some cloud native services, put it on the public cloud? Do you need to be near your data that lives on somebody else's cloud, go put it on their cloud, right? So it really is not a one size fits all, it's whatever your business needs. You need the customer where he is, right? That's often a- So basically- Flexibility choice. Flexibility and joy. The store for all things cloud. Yes. Absolutely. Last thing I want to ask is, where do developers fit into this joint solution? Yeah, so I think the biggest thing is that external change for us is making these services available in a portable manner. When do I quote unquote lock into the public cloud service, but particularly data, and unlocking that from the infrastructure is probably a key trend. So for us, it's about staying true to Kubernetes and upstream with the distribution. So it's portable. Providing more and more services and making it easy for them to access a catalog of services on a Pego manner. But then making it operationally viable, so when you deploy it, you can support the day two operations that are needed. So it's that full life cycle with developers not having to worry about the heavy burden of running and operating, is what we say. Exactly, you know, it's all about the developers. As you well know in the cloud world, the developer is the operator. That's right. So as long as you can give him or her the right set of tools to do CI CD DevOps and get things out there in a consistent fashion, whether it is on-prem or a public cloud, I think it's a win for all. That's exactly the trend we're seeing. IT operations moving to more developers and more big time operational scale questions where you're programming the infrastructure. Absolutely. And developers who don't want to deal with it. And making it workload-centric so you know when to deploy what workload and having the full control as part of your app deployment. Exactly. All right, final question. I know we got to break, and final point, share perspective of what's important here happening at IBM Think 2019. If people who didn't make it here in San Francisco are watching you at the two top cloud executives on VMware and IBM here, obviously you buy us towards cloud, of course. But you know, if you're watching, what's the most important story happening this week? What's going on with IBM Think? Why is this conference this week important? I think for us it's basically saying we're here to meet you where you are, regardless where you're in your customer journey. It's all about choice. It's no longer only about public cloud. And you now have a lot of capability at your fingertips to take your legacy workloads or your net new workloads over any app, anywhere, we can help you on that journey. That would be the key takeaway for me. Yeah, and I would echo that, right? Set it slightly differently. You know, a lot of the public cloud service providers kind of bring you over to their public cloud and then you're kind of stuck over there. And customers don't like that. I mean, you look at the statistics, everybody has at least two or more public clouds. They're worried about the connectivity, the interoperability, the security, the cost, the skills to manage all of it. And I think we have the perfect set of solutions that really start to speak to that problem. So the world's getting more complex as more functionalities here. Software's going to abstract it away. Developers need clean environment to work in, programmable infrastructure. And choice. VMware and IBM say choice, choice, choice. VMware and IBM. Top two cloud executives here inside theCUBE from IBM and VMware bringing all the coverage. It's theCUBE here in the lobby of Moscone North on Howard Street in San Francisco for IBM Think 2019. Stay with us for more coverage after this short break. Thank you, John, it's you. Thank you. Thank you.