 from our studios in the heart of Silicon Valley, Palo Alto, California, this is a CUBE Conversation. Hi, I'm Peter Burris and welcome into another CUBE Conversation from our Palo Alto studios. Now as we do with all CUBE Conversations, we want to have a great conversation about an interesting topic with a thought leader in the industry and that's exactly what we're doing today. The topic we're going to breach is why is it that networking remains so expensive? If we go back over the past 20 years of computing, we've seen dramatic price performance improvements in virtually every single sector of infrastructure, but networking persists as a relatively expensive technology arena despite the fact that we're moving into an era that is going to become increasingly depending upon networks. And to better understand both what the nature of the problem is and how we're going to move forward with a solution, we've got Dominic Wilde with us today. Dominic is a CEO of SnapRoute. Dominic, welcome back to the CUBE. Thank you. It's great to be here. So tell us, let's start. Tell us a little bit about SnapRoute. Tell us a little about yourself and SnapRoute and then we'll get into it. Sure, sure. So SnapRoute is delivering basically a sort of new paradigm in network operating systems. We're delivering a cloud native network operating system that's designed from the ground up to integrate into this new world of cloud. Architecturally, it's a fully containerized microservices architecture from the ground up. And what that does is it enables an operator to deliver faster time to service for applications, to always be secure and up to date with security compliance and also to drive significant operational efficiencies as well. So we believe that we have a really strong value proposition for the industry here, particularly in the age of cloud. But we're also marrying to that architectural innovation, some economic innovation as well and economic disruption. And we believe that the time is really right here for networking to step up its game effectively. Let's talk a bit about that. If I'm a CIO, every year, for a variety of reasons, every year the business comes to me and says, okay, you got to give me back 10%, but we want you to do more. And Moore's law and other physical features of how computing worked has been very kind to me. I've been able to provide some of that back because I was able to get cheaper servers. And then Open Source allowed me to get cheaper operating systems and even applications got cheaper and then SaaS comes along and the cloud comes along. Networking's the holdout. Why has networking been the holdout? Yeah, well, simply stated, I think it's because networking has not embraced or driven software economics, whereas compute has in many different aspects. If you look at the timeline of what's happened in recent history in compute and parallel that with networking, compute got Linux. And that gave an architectural innovation, it gave greater control and the opportunity for operators to innovate on their own, but it also drove this big economic disruption. The prices really came down, then came virtualization. Of course, there was the opportunity there to drive down the prices again because I don't need five servers, I only need one. And another great innovation in terms of operator control. And here we are now in the age of containers and cloud native and you get much greater sort of performance benefits of going containers on bare metal. And so all of these things have happened where you have an architectural innovation married together with an economic innovation. At the software level. At the software level. And this has not happened in networking because in networking, we've continued to really treat the network as an appliance. It's proprietary integrated, packaged, switches, routers, et cetera. And quite frankly, we got Linux. We got Linux in networking, but the prices went up because there was APIs were introduced in programmability and there's much greater value there. So therefore we're charged more. And then virtualization came along and SDN, the SDN movement. And there was great hope I think in the industry that this would drive a real sort of economic revolution in networking. But what happened was that rather than really addressing the actual network itself and the software issues with the network itself that make it brittle and very difficult to manage, we got overlays. And we added overlays over the top and abstracted the underlying network and added more layers of complexity and expense. And then here we are in the container age. And one of the things that we've done here at SnapRoute is we've said, look, let's embrace containers fundamentally and let's build an operating system using that technology with DevOps principles to deliver an architecture that lends itself to the task at hand, which is the move to cloud. And how can we enable organizations to move quickly to cloud? And let's face it, cloud is a distributed architecture. And so by building a network operating system with an architecture that is essentially a distributed architecture, it gives us some advantages. But let's marry together that. Let's put the economic, software economics in there as well. And quite frankly, we tried this around about the time of virtualization, the sort of white box networking movement happened. And again, there was great hope that, hey, this means I can get cheaper networking. But explain that, right? White box you mean is effectively you're able to get commodity hardware. And I'm hoping that you could just drop your network operating system software on top of it and replace these full stack switches and these full stack riders that we're supporting 50, 60% margins. That's right, exactly right. And I can go direct to an OEM, I can buy the hardware at the same, if I buy the volumes at the same cost that an OEM would buy them at, go find myself some software or software operating system, put it on top of I go, it should be cheaper. The reality was that what happened in the industry is that the software that you could buy, the disaggregated software operating systems, absorb the savings that you've got from a lower cost hardware and so everything evened out. And actually, quite frankly, the white box has not delivered on its promise. It has for the hyperscale vendors who are buying in massive volume and are building their own operating systems, built for purpose. But in the broader industry, we haven't seen those advantages. And so what we did at SnapRoute is we took a big step back and we said, look, if you really need software economics here, then as a software company, we need to step up. We need to be the one. You're a software company and not a networking company. We're a software company. I mean, at the end of the day, we're delivering a network operating system, but we view it as it's an application. Sure. And the architecture we've built is not a traditional monolithic Linux blob as it were. We've really embraced the DevOps culture, the DevOps paradigms we've embraced, all the application and software developer paradigms of how you build a state-of-the-art cloud-class application today. And that's what we've done with the network operating system. We've taken that approach to deliver, what is effectively a distributed application. So let's build on that a little bit because the, as you said, the white box approach doesn't work that well in the networking world, largely because some of these network operating systems companies were delivering these very large, monolithic pieces of software that really were just layers on top of a network that often people didn't need and generated a significant amount of lock-in. So it was always questionable to begin with. The approach that you're taking, using containers, modern software techniques, cloud-native approaches, allows it seems to be two benefits. Let me see if I got this right. Benefit number one is, it looks like a set of programmable services to the DevOps world, which is good. And number two, because it doesn't have this monolithic footprint, you can appropriately skinny it up so that it now does make sense to think in terms of a new economic model, because you can get access to the services you want, you don't have the security, you don't have the footprint associated with, talk about that. Yeah, I mean, if you look at it architecturally, and you're spot on it, but if you look at it architecturally and let's for a moment empathize with the NetOps teams, because their job has been to take something, take a network using tools and products that the industry have given them, and try to live in a very dynamic world, the cloud world, the new class of enterprise. But what they've been given is a set of tools and a set of products that only enable them to build a very static and very brittle distributed sort of system, distributed network. And these just happen to have the tools to work with. They were largely separate from the services that were running on the network. Very much so, NetOps has been siloed and the network is more siloed. Our founders came from Apple, where they ran Apple's biggest data centers. And one of the things they tell me is that, the sort of peer pressure and stuff was that if there was a security vulnerability that had to be patched or something, that the DevOps team would come in and the compute team would sort of say, okay, we can patch that in a couple of hours, couple of days at worst. And as the networking team, they would sit there in the corner of the room, very shy, sort of saying, well, it'll take us several weeks to get back to you with a plan for a plan. And then we've got to wait for an outage window and it could take months. And so NetOps has had this really, really difficult task of living in this dynamic world with everybody else. But the issue here is that if you can deliver the tools, the set of tools, and that means an operating system that is designed to be dynamic in the first place, then you should also not only be able to reduce the operational costs overall, because now you enable NetOps teams to move faster and stuff, but you have to be able to deliver an economic value in terms of OPEX, because otherwise there's no reason for anybody to move. It's probably safer to stay where you are. It's probably, change always comes with some kind of cost and some kind of risk. And by the very nature, NetOps teams have become risk averse because any time they changed anything, the network could break. So they have had to live in a world of no. Every time somebody comes to them and says, hey, I have an application, I need you to do this, that, and the other, the answer is no, because I don't want to change anything. I measured on uptime. That is the standard measure that networking teams are measured by. And if I'm measured by uptime, then I don't want to change anything. Well, in several world we used to talk about how the cost of the change was underwritten by the improvements in price performance. And in many respects what you're saying is by taking a new approach, you are paying for the cost and risk of the change because you're jumping to a new economic model that fundamentally puts you on a different vector, not only for new economics, but also creates new classes of options in the network that's much more cloud-like. Yes, exactly. I mean, it's, and this is, I believe, a fundamental of the sort of cloud thinking, cloud mentality and the reason that we're all trying to get to cloud is exactly because it gives you more flexibility at lower cost. I mean, everybody's embracing the public cloud. Now, what we've seen is some recent numbers coming out of Lyft that they've had to commit $300 million through 2021 to their public cloud provider. And those numbers are scary and terrifying for a lot of companies. So going all in on the public cloud maybe is not the right way to go. But living in a hybrid world where you have some on-prem, you have some public cloud and working out which model is best for your company is the right way to go. And the network has been an inhibitor to that because if you have to have a different on-prem network model then it's being used in the cloud, in the public cloud or as you use the virtual services there, or now you're adding a bunch of cost operationally because you have to do two different things and you have to figure all this out. And very importantly, you're losing a lot of the options that the cloud provides you. And the whole point is to get a better cost profile to be able to use new techniques and approaches to building applications, but also to be on a vector that provides new types of options in the future so that you don't have to worry about this network having these limits and that network having a different set of limits. And so it brings a more unified approach to say this is a common resource to the business that is these profiles, this physical characteristics, these software characteristics and these economic characteristics. Exactly, yeah. I mean it's a service book mentality. It's like, hey, I want to have a set and a list of services that I subscribe to and I just pick and choose or innovate new ones and that's been very difficult in the legacy networking world. So yeah, the approach is to come in with this architectural change that enables the innovation, it enables that service mentality, it enables, it frees up the business to be more dynamic, to be more responsive and agile, but give the economic driver, do it in software economics that allows you to kickstart that, allows you to gain the momentum within your organization to say, hey, we should try something new because there is enough savings here and there are significant savings here. So to give you an idea, I mean what we deliver at the system level, so if you take a white box, an ODM box and you take our software and put two together, install one on the other, at the system level we're about 50% the price of any of the legacy incumbent vendors. So it's half the price. Now previously in white box, what people have found is actually when they were trying to do stuff themselves the price is pretty much the same, if not a little bit more expensive once you add in the operational costs. So we're really actually giving the opportunity to make white box successful. We're giving the opportunity to deliver control and the opportunity to innovate to operators, but most significantly when you're going to talk to your CFO or your CIO or anybody else, we're driving the price down so significantly that. Well I was doing a quick calculation. I had 50% savings on network and a sizable enterprise translates into about two-tenths of a margin point for the business. Not bad. Dominic Wild, CEO of SnapRoute. Thanks very much for talking to us on theCUBE today. Thanks, mate, thanks. And once again, I'm Peter Burris and this has been another CUBE Conversation. Until next time.