 Hi everyone, this is theCUBE, our flagship program. We go out to the events, extract the signal from the noise. I'm John Furrier, the founder of Silicon Amdrill, my co-host, Stu Miniman from wikibon.org, and Stu. Dave couldn't make it here, and I'm bummed because there's a lot of cloud action, but you're the chief analyst on the cloud, so I want to get your take first on what's going on at the event. And then I want to go through the news because there's a lot of news that happened that we want to cover. First, what's your take on the event and the day we just had in front of us? Yeah, John, so it's great to be here, 10th anniversary, a lot of buzz at the show, always a good community, and definitely just a great warm vibe from the Red Hat people. We just talked to Paul Cormier and talked about the difference between really being open source and being quasi open source. Jim Whitehurst, I thought that was a great discussion, CEO of the company, the first billion dollar open source company. He said he has dinner a couple of times a year with the other open source companies, so a company that is really about building value to the community, delivering value to companies and helping to expand the future of software. You talked about cloud, this is obviously a very important piece of cloud. Linux is everywhere, and open source becomes more and more important as time goes on. You know, Stu, we had the top executives come on theCUBE as always great for us to have the kind of interactions with the CEO, the presidents and the GMs of the divisions, OpenShift, Platform Group, the CEO, we had the CTO of Cisco on, just luminaries in this field, okay, so what's interesting is the big deal is DevOps, and this is not new to us in our audience who follow theCUBE. DevOps is huge, but I found interesting some of the commentary around the Red Hat guys who look at JBoss and Linux, kind of the convergence, Linux was the ops and JBoss was the dev, that essentially became the kernel of the DevOps movement which began many, many years ago Stu. So now, since has come up there, big market opportunity, a lot of core competence around open source with Red Hat, a lot of differentiation now with the cloud. So you have two big things in my mind coming out of today, and this also talks to some of the news from Red Hat, is open source is now fully commercialized as a tier one front runner platform for all the software innovations, okay, and two, the disruption behind that is the combustion engine, the steam engine, the printing press, whatever metaphor you want to use, this is an industrial revolution like shift. So at the heart of this is virtualization and now the big news here, this notion of container. So one, I want to get your take on that, the trends I just mentioned and virtualization embedded in Linux and now containers in the cloud. Do you agree with that? Yeah, so John, first of all, it's an interesting change in the discussion. I think back to the early days, Linux was to get people off of proprietary Unix. Then for many years, it was kind of Linux open source versus proprietary Microsoft, and now they got up this morning and said, there's basically two main operating systems in the enterprise today, it's Windows and Linux and the enemy in many ways is VMware and Pivotal comes up as those are the ones that they see as kind of threatening to the model. Quasi open source, it's not virtualization that's built into the operating system. So those dynamics are kind of interesting and definitely get some of the arguments in the marketplace as to which was the right way to build things. As you brought up though, John, containers I think is the buzz of the show. Getting to talk with the founder of Docker, big announcement here, and I think containers is just a very important piece of allowing Cloud to become reality. Yeah, and it's also, it's a primetime moment for a startup called Docker, which is, we talked to the founder today, Solomon, Ben Golub, the CEO, experienced tech executive going back to the Verisign days when I first met him. And that's interesting and also about Docker's is that's Jerry Chen's first investment. Now Jerry Chen is a CUBE alumni and it's probably one of the most important venture capitals in Silicon Valley right now. He's had one of the big top tier firms, Greylock. They have partners like Reed Hoffman. They're just a really amazing firm. They're doing a lot of great deals. They invested in Cloudera, Dropbox, and you name them, they've invested in them. But just Jerry Chen's first investment. And we were watching Jerry Chen who basically created VCloud at VMware. When he became a venture capitalist, it was like that star baseball athlete. When is he going to get his first hit? He's in the major leagues in the investment circles. And it's interesting, he was very much waiting to play the field and it's always nervous to get that first hit under your belt. So this is Jerry Chen's first choice, an interesting one. He read the tea leaves, he saw around the corner, he sees the container, and really, that's an application focus. So I wonder if that's a little bit of, he knows a little bit about what's going on VMware. This is an alternative, what's your take on that? Yeah, yeah, John, it's fascinating. Cause you know, we watched, you know, in 2010 when we went and saw VMware and we were here in Moscone, and for VMware, you looked at the executive team of VMware was a bunch of former Microsoft guys and it looked like they were going to build their own application portfolio, buying companies like Zimbra and Slide Rocket. And VMware's moved away from that. They've now got, you know, Pivotal spun out and in many ways they need to be able to create that foundation and court the developers to build the next generation of applications rather than owning their own application today. And of course Red Hat, as you said, you know, is also trying to court those developers with what they've done with Jboss, with what they're doing with OpenShift. So, you know, you look at some of the big companies that have traditionally owned their own applications, companies like IBM who have things like DB2 and they're building out over a hundred SAS models, SAS applications out there, companies like Oracle obviously, you know, huge presence in the database market. And then you have these companies that are building the foundation for these next generation of the cloud mobile social environments. So we have a blog post up on a comment. I want to just share the headline and that is that, you know, you got Padme, Warrior, CTO, entering a new internet era demands industry co-operation. And I think that's the real story here is that you heard about the movement to the cloud is highly competitive. We had obviously direct commentary on Cloud Foundry from the president of Red Hat talking about a quasi open source, trying to lock you in with an open core and proprietary technology where Cisco's taking a different approach. Cisco understands unification. In fact, one of their UCS initiatives is about unification in a network layer. So Cisco very much understands that unifications do. Also, they understand the elastic nature of the cloud and they mentioned words like dynamic and agile. And that is really the phenomenon. Cisco carries a lot of chops because Cisco can be slower than some of the other companies but they know there's stuff they got to get it right. Technically, some will argue that, but for the most part, they don't do a lot of grandstanding. So when you hear Padme say, hey, unification, agile, elastic, I mean, she means it. So you got Cisco, you got IBM, all these guys are all here. Pretty big deals, Stu. Yeah, yeah, great ecosystem. At the end of the day, when I look at Cisco, it's still about driving traffic over their core networks. They have a very network-centric view of the world. And when they talk about the internet of things and cloud, it's about connecting the pieces together. What's been really crystallized for me is when I look at Red Hat, it's been a while now that they've been more than a Linux company, but there's definitely no way people can look at them and say, oh, they're primarily just Linux. They've got, there's great chops in the networking world. They are heavily active in cloud environments. And as we heard from kind of the party line in these messages at the show, it's physical, virtual, public, and private. Those four environments that as CIOs try to figure out where their applications live, Red Hat's going to have a solution. It's going to be enterprise-ready, and they're going to help to drive that home and be in that next generation platform. So it's about internet of things. It's about the clouds, about data. We heard a lot of commentary throughout the day, but the big news today really is about Red Hat laying out the announcement for Red Hat Enterprise Edition 7, and the containers beyond it. And everything else kind of has to do with wrappers around that message. So announcements like innovation, some reference studies, mission-critical applications. So you got RHEL 7, okay? Red Hat Enterprise Edition 7, the containers around it with the focus of applications. Tomorrow we're expecting to hear some things around OpenStack and some announcements with other partnerships. So interesting day one, setting the foundation, bringing all their heavy hitters to theCUBE. We loved it. The enterprise is their bread and butter. I mean, obviously besides the open stores, communities where they do their work, they've been doing very, very well in the enterprise. 65% market share and continuing to have that mojo and extending on that lead as we talked about. And obviously the containers is a big piece. So that's the news of the day and just other kind of commentary on the revenue model. We heard them looking at potentially new things, but nothing that's going to be orthogonal to their core subscription model. We saw the application being King, OpenStack Pass with OpenShift. You see the notion of Microsoft and DevOps kind of orbiting around their relationship with Amazon Web Services. But really you see them differentiating around this open core strategy. Red Hat is old school and they want to be new school with the continuation of the open source business model and they're poo pooing the open core model stew. And it's all about Linux, OpenStack and OpenShift, the big bet that I see here is it's OpenStack. I mean, everything, all the chips are on the table with OpenStack. Yeah, so John, we haven't talked about Amazon too much. Amazon is a sponsor here, they're a partner of Red Hat, but it's really clear that Red Hat is going to support all environments. I think if you were to, in a closed door session, ask some Red Hat people if they would prefer if OpenStack or Google was to gain some share against Red Hat, they'd probably be interested in that. But for the time being, Red Hat's supported really across all environments. So companies doing, Amazon are going to be able to do Red Hat and Red Hat's giving customers options to be able to move around so that Amazon does not become a lock-in environment. Paul Coemeyer said it best, their core focus is open source innovation continuing to extend that business model around four major pillars, physical, virtual, private, and public, wrapping around the open source. Dude, that seems to be the thing, the competitive landscape, it's still some of the same for Red Hat, obviously cloud foundry and the alternative cloud approaches seem to be the big thing. And with virtualization and containers really becoming the technology elements that seem to be the battleground and all the stuff in between, orchestration, software, all those, the white spaces around those key things, all pointing to one thing, that is the developer. The developers are the focus, whoever can bring the mojo and the magic and the greatness of value creation, the developers will win. I think Red Hat's very poised. Yeah, and John, it's impressive to see kind of the culture here. Jim Whitehurst, very laid back, when he's not doing all of his traveling, he's splitting his time between kind of the home office in North Carolina and obviously he's here in the valley a lot. But they're not a aggressive competitive company when it comes to trying to knock the competition or take over a market. It's very much about working with customers, working with the ecosystem. Red Hat's a company that the community helped build and their future relies on still working with that community, both partner ecosystems and a ever-growing group of developers that are going to code with them. The big thing was I wanted to get on the table that was kind of kicked around, not necessarily formed an opinion on yet, but the role of data. DevOps is really a cloud and infrastructure thing. When you start thinking about the role of data, I still think there's a dev, data, analytics angle here that's going to look like DevOps. Kind of where DevOps started, I think I'm starting to see that now at Stu. And all the top computer scientists like Paul Comear and others in the systems architecture world have to really think carefully around data first. As an application component for the developer. Developing with data as a primary asset, latency, getting access, enabling that up and down the stack will be key. So, great day, it's about the cloud. It's about Red Hat Enterprise Editions, about the containers. Tomorrow we'll hear about Cloud Foundry. We'll drill down from some top companies as well that are partnering, the partner announcements. This is theCUBE. I'm John Furrier with Stu Miniman from Wikibon filling in for Dave Vellante, who's out back east this week. And as always, we always have Jeff Frick available. Jeff Kelly's in the house. We have a stable of analysts always on call here, Wikibon doing a great job. The SiliconANGLE team's doing a great, great, great work here and all the folks back at the ranch. So, thanks for watching and come back tomorrow and stay with us for day two coverage, all day tomorrow and we're here live at theCUBE in San Francisco all day tomorrow. Thanks for watching, we'll see you tomorrow.