 Back here at Sapphire, behind us we're in the global communication centers is Ground Zero. SiliconANGLE's exclusive coverage of Sapphire now. We are here inside the Cube, our flagship program. We go out to the events district to signal from the noise and we have the executive committee behind us talking to all the analysts that's off the record. We were streaming the press conference earlier and the CEO press conferences, but this one's kind of off the record. We're hearing everything. Guys, we're hearing everything. Welcome to the Cube. Thank you. So introduce yourselves and what you guys want to talk about. Yeah, my name is Tony McCoy. I am with EMC and I manage our alliances for the Americas. Everything that we do with systems integrators, outsourcers, service providers, and we're here to talk about the great partnership we have with CSC. Yeah, David Parsons. I look after our Vice President of Global Alliances and Chief Marketing Officer and here to talk about our long-standing relationship with SAP on the application side, our new banking announcement, and the work we do with EMC and the IT transformation space. So the big trend obviously here is the portfolio across the lines of business in SAP is pretty much on track going back three years. Mobility analytics, no major change, but cloud is obviously is morphing. It's up in the air as pun intended. And because you have HANAs, it accelerates the conversation now around multiple market dimensions, existing SAP customers, new business. And then kind of like this conversion infrastructure, you know, private cloud meets hybrid cloud. So guys, that's accelerating a lot of confusion, but yet opportunity in the marketplace. So David, talk about what you're seeing in the marketplace because people want one throat to choke, but at the same time they need multi-vendor because more things are being integrated. Not necessarily as one product, but you need to have testing and certification and that puts a lot of pressure on the delivery and the integration. So what do you see around that? The key trends. I'll answer from two dimensions. One is just CSC in general. We're a big SAP shop, human capital management, financial services. And when you look at what we're doing around new platform and technology, it's looking to take and modernize our SAP implementation and host it in an environment because we're not just an SAP shop. We have a lot of their suite. But when we look at CSC as an internal case and we look at the market, what we're seeing is the need for a diverse horizontal platform that will allow us to create and as a service delivery model at the infrastructure layer and then create on HANA using the big data approach unique use case scenarios by vertical almost that are very outcome-oriented around the kind of insights that the clients want to produce with the data. So we're really eating our own there in terms of our internal use case and we're going to apply that broadly and a big part of our partnership with EMC and the VCE community is around taking their technology platforms, our expertise in IT infrastructure and transformation and then creating that next-generation platform to go host these new next-gen applications as well as the apps that are modernized to support that environment. So I have to kind of bring up the IT as a service because this is a great, I just love IT as a service and agile, buzzwords out in the marketplace and then they mean something now. So let's break that down. You have different levels of service. You have the agile. I want to deploy some applications that's on top of the stack. I want some mobile. I want some analytics. That's great. There's good business to do there. But some IT as a service can take months to roll out, which was years in the past. So that no high-end where VCE's been playing has been really making a lot of strides on the time to value. So as you guys get into the delivery side, that is a service, there's some integration involved. Can you talk about how CIOs look at that particular piece of the business and what's different now than it was just five years ago? Let me have Tony weigh in and then I'll couple my things. Yeah. Well, I think maybe what's different now than it was a few years ago is that we can actually show some success in the space, right? So with these guys and what we're seeing more and more of, especially with the advent of converged infrastructure and with some of the capabilities of our companies like CSE is we're actually able to deliver on the value of agility, or I should say the promise of agility. It actually makes some of this stuff happen, whereas a few years ago we talked a lot about it, but it wasn't. We weren't really able to deliver. We also, you know, we see some of the other more consumer-oriented cloud players out there that are driving this message of agility. And that, I think, is kind of setting expectations in the enterprise space that maybe have been a little bit tough to deliver on. We're really starting to see now with some of the capabilities that CSE has, building their hybrid cloud solutions on Vblock, really starting to actually be able to bring some of these things to life. And I think what they're doing around SAP is a great example of that. Tony, what's different five years ago? Because, you know, Vblock's morph has gotten some legs now and the C-legs are established. We have great testimonials. We talk to on theCUBE all the time. It seems like a secret, right? You think Vblock's a secret? No, not anymore, but the world's getting out there, but, you know, Vblock, people are like realizing, hey, I can actually roll this out. So it is a service in a way, so it fits that build, it's clouds, and so what, why? Well, let me ask, let me build on that, because I think from the client point of view, when you look at the balance sheet implications of moving to Azure Service, you know, this notion of capex versus op-ex is a big deal. And one of the things we've been able to do through our partnership and our combined vision of the Software Defined Data Center last week is an example of the EMC world. We just launched a new Software Defined Storage Offering, which is a next-generation offering from EMC. We're a first early mover there, so what we're trying to do is take our technology partnerships and create, in a shared R&D sense, a three-year roadmap and a set of offerings that really address the client need, both financial need and the need for speed and agility when it comes to offering. So we are actually building now, and actually have in market now, a storage as a service offering that's all capex-based. And you're delivering that? We're delivering that, yes. We just launched that two months ago, and this builds on our hybrid public-private cloud platform, which is all built on the V-block fabric. And then when you think about what's going on in the ecosystem around Software Defined Data Centers, you begin to kind of think about this notion of what the next-generation infrastructure environment looks like. And for our clients, what CSC is bringing to the table is a set of consulting and advisory services that allows the client to build a roadmap, a journey map that works for them based upon their financial situation, their business, and agility requirements. And that's really been the beauty of the partnership, is we're showing up together at the client side. Yeah, so obviously the co-innovation is a key theme for you guys that's been successful. And the SAP-EMC relationship seems to be stronger than ever, given that you guys are in the same kind of co-innovation mindset. What are you guys hearing from customers now? I mean, talk about the customer conversations. What is some of the most consistent, what are you seeing in the broader market conversations that are, that's repeating itself? In other words, what are you hearing most about customers? Are they fearful? We heard some customers are jumping right in, because virtualizations kind of train the mindset, like, hey, we can do some new things with virtualization, but now it's going to a whole nother level. What are some of those conversations that have been talking about? Yeah, just, sure, I don't think there's one conversation we had had. I think there's several, and some CIOs are obviously a little bit more comfortable with it than others might be, and others are waiting a little bit more to see how it goes. What we try to do is at least engage in the conversation to make sure that they understand the ability to virtualize mission-critical laps. We use ourselves as a great example. I mean, EMC, you asked me what's different than five years ago. In the past several years, five years ago, we didn't have a virtualized instance of SAP. We weren't running VBlock ourselves, and we didn't have the capability to deliver on a lot of the things we were talking about. That's what we do today. So we're across our business well over 90% virtualized across all of our servers, and completely virtualized in SAP. We're running that all on VBlock today, and we're able to really talk to CIOs about... Yeah, EMC. EMC. We've done it. We've done our own customer zero in this thing, and we've got a great set of learnings that we can communicate to CIOs who want to engage in the conversation. Some still aren't going to ultimately be 100% comfortable, but by listening to our own experience, and by talking to CSE about some of the experiences they've had with their customers, it really does help to paint the picture that there's a reality out there. Yeah, but what do you say to all the NACs? Ah, EMCs are all wet. The VBlock has no traction. How do you talk about it? Because there are people who would say that. The VBlock has no traction. The VL has no traction. I mean... I guess my response to it would be that if you look at it that... Some people say not everyone, but the competition. The latest Gardner numbers show 57% of the market is VBlock. It's in a company itself. For convert systems. For convert systems, I'm sorry. And that VCE themselves are on a billion-dollar-plus run rate on an annual basis. And so I would say if they're saying that VCE is not real, I think they need to look at some of those statistics. I mean, we kind of define the converged infrastructure space. We were the first mover in that marketplace, and we had a ton of success with it. I mean, 2010, you guys had use cases with Levi Strauss and a variety of other companies in the past. You know a lot of stuff. So it's not new. It's not new. It's absolutely not new. And so on production, that's another thing that people don't really understand. And this is, again, another kind of, maybe it's fud from the competition, but where's the production deployments? So where are the production deployments? The production deployments are out there as well. And again, we can point to ourselves, and we have a host of other customers that we can point to in this space. So it is real. We just need to get out there and do a good job of educating customers about it. But the deployments there are in financial services, there are in insurance, banking. There's plenty of examples in manufacturing. This is not some small market. These are big deals. These are big deals, big clients. But to your point, I mean, clients are kind of in a crawl-walk-run sense. They're in a crawl-to-walk state. We are beginning to see massive scale-out roll-out. Particularly now, as companies are recognizing that this cloud thing is not just a fad. The idea of public, private, hybrid, and going back to your earlier point, having a fabric that'll work across multiple environments. I think that's a big deal. In fact, I think one of the things that's limiting EVECE is the fact that there's a variety of new use cases emerging. We had a customer on theCUBE. Yes, they were talking about SAP and Cloud and HANA and happened to be a V-Block customer. So I'll dig in to have any chance that I get to get some V-Block data. I said, tell me about your V-Block story. He's like, well, you know, I'm paraphrasing now. He basically had a gun to his head. And he had a data center that was overloaded. He had six months and they had a lease up. So a combination of two forces that were really problematic. One, do they renew the lease? Get a new space and they were out of space. Physical space. So he essentially reduced his servers licenses by 60% when virtualized with SAP and V-Block. And he said it was great. And delivered on time. And six months. He said, I delivered it with V-Block in six months. And that's unheard of in IT. You just don't hear that. Well, that's a big deal. Well, the other part of this, as you know in the value prop, is the ability to automate a lot of what required systems administrators and software. So there's a lot of that automation, orchestration, management layer that gets really commoditized in one sense. And for folks like us in the services business, we recognized several years ago that look, while that was a big part of the business, we're moving up the stack into the application layer. So I got to ask you on the services side because the services business is going through transformation as well. I mean, I see new services are being enabled. We had one guy on here from an SAP customer who's building a mobile app in Canada for the transit. Turns out they touch all the consumers. And what they're moving into is essentially to be like a living social. They're a retail play now. So they've gone from a mobile app where to find the bus and the trains to basically having an individual experience for the consumers. So new revenue models are exploding. So the question David's used as, as you guys get these six months deployments, traditionally that's not good for the consulting business. You know, you used to be, hey, I want a 20 zillion month contract. So now you've got six month deployments. So what are you guys doing to get more services? Because there's still demand. There's more work to do. What are those new services? Well, a good example is the announcement we just made with SAP at this conference. We just launched a joint initiative in banking for a new secure digital banking system where we're taking the assets, software assets from CSE, the old Hogan assets, and SAP's banking assets and we're combining that into one offering in addition to our business process expertise and leveraging our IT transformation expertise. And what we're trying to do for the banking community, and this is a great example of CSE moving up the value chain, is for us it's all about the application, modernization, workload, rightsizing and then the business process by vertical. So in SAP's case, the client value to banking with CSE is to help clients create new revenue channels, new income channels through multi-channel distribution strategies, exploiting the social mobile architectures that sit today and delivering our platform as a service. So basically what you're saying is you're generating top-line growth and that keeps you in business. We enable that for the client. You enable the client to make more money and therefore you keep the business. Well, that and there's a bunch of, that's a good business model. A bunch of integration work. Yeah, associated with that. When you think of mobile social and you think of all the infrastructure you need to go support that. And by the way, that infrastructure could be delivered public, private, hybrid. There's a lot of orchestration elements that go. And it's in a whole mobile social thing. When you think about all the billions of devices that we talk about and you think about the social communities and how do you mind, it's a big data play. How do you mind that insight? How do you create the insights? So this is this, when we call it secure digital platform, that's really where we're focused. It's bringing all this together in the market. Yeah, it's a no-vail concept for creating value for your customer and do more integration work is just great. That's the business model. Tony, I want to ask you the question obviously now that the business are changing what's changed on your guys end? Obviously dealing with CSC, big firm, big clients, the relationships there. And when you have market transitions, sometimes you got to kind of re-dance to the new music. So what is that new music? Share with the folks some of the things you guys are doing with CSC. How has the co-innovation partnership evolved? Yeah, I think if you look at what we've done together in the last three to four years, CSC, the relationship with CSC has grown to be the strongest that we have within our company and our partner community. It's certainly as strong as any. They've been, and what CSC I think has fundamentally done that has been maybe different than historically is they now are willing to lead with a point of view in the marketplace about what they believe the right solutions are for their customers. And as such CSC was an early launch partner of ours with VCE, one of the first of the table when we did that. You saw that again with, and by the way, took that and did something incredibly innovative around BizCloud and their cloud offerings that have continued to have been and continue to lead what goes on in the industry. And then what we did together last week with the Software Defined Data Center announcements and being an early launch partner with Viper. The relationship is obviously very, very strong and very tight. Now, it's led to, I think, one of the things that for us as a guy that works with EMC Field all the time has led to a great deal of trust and cooperation in the field to go out and work with our joint customers together to help find and drive incremental opportunities for both of us because we're now, because we've formed and grown this relationship, we're fundamentally able to bring something to our customers that we wouldn't have been able to had we not done that. So it's the strongest relationship we have in the marketplace and I think there's a number of examples that help to illustrate that. David, you get a lot of traction on Twitter outside of the banking thing which you just mentioned, banking innovation you guys are doing. You got some good traction on the other solutions you guys are doing around mobile. What are some of the other things you guys are doing here? Well, the big data thing is massive, right? It builds on the whole HANA play but we've developed a whole business unit that we're incubating that allows us to bring the best and brightest minds around all aspects of the big data play. Both from a technology perspective, a platform perspective and then more importantly, as you know in the big data area, it's all about vertical use cases to create the relevance. So when you think about our vertical strategy in healthcare, in financial services, in manufacturing, transportation, retail, and then public sector, there's a lot of unique insights that we're able to bring to the client, building upon this great technology. So that's a big deal. The mobility play is a massive play for all of us. The security too, same thing. Well, cyber is another incubated unit, so this is another part of our EMC partnership. We have a huge element with RSA and then we have the whole pivotal dynamic now, right? When you think about that combined. It's a developer market, wide open for you and that's going to turbo charge. So you're essentially partnering with SAP at many levels, infrastructure, outside of the cloud, outside of the technology level and then with Pivotal, that's a developer angle for you, right? It's application. So think application modernization enablement. Think of the next generation platform as a service and you look at what they've pulled together in terms of with the GE investment, the next generation of industrial applications. That's an exciting area, right? Internet of things. Internet of things, yeah. So we see significant potential there. That's exciting time. I mean, I got to ask you guys just on a personal level and ask everyone all week, you know, relative to your relationship and SAP and kind of the world of IT and tech, what is the most amazing thing that you've seen in the business that you say, wow, that's amazing? What is the most amazing thing that you've seen? That's different. Just this week or just in general? This week or in general. Yeah, well, I think- You mean levels of amazingness. Amazingness week and amazing. Well, the amazingness for me is the Internet of things, right? When you think about this notion of millions of sensors, right? And you think about, you know, we had a guy here from McLaren today. I don't know if you were here for the keynote, but, you know, CEO, Chairman of McLaren was here and he was talking about the fact that a simple race car, right, has, you know, tens of thousands of sensors on it and all that data is processed in real time. And it's actually, it was billions of, billions of inputs, right? Billions of bytes of data. And how, in two race cars, it was double the population of the world, right? In terms of the- The data acquisition. The data acquisition. Real-time data ingestion with insights and feedback. And when you look at that as a microcosm of the world we're going to live in, when you think about GE's business and Johnson Controls and any company that's got the ability to harness and ingest that data, the fact that we've got the compute technology and platforms now to be able to do that and then to create the business insights, the rules and policies to make it useful, real-time, blows me away. Tony, what do you- I would, you know, I won't just simply agree because then it- But I do- I'd say check, I'll add more amazing. Exactly, you know, it's- Absolutely, it's incredible. I would also say that it's, the rate at which we're seeing, because you asked me earlier, you know, what's different now versus five years ago? Is it related to the cloud and the as a service economy? The rate at which we're seeing that start to become reality, not just in the SMB market but in the enterprise market is fundamentally transformational. And I think we're all, we're all feeling it, we're all seeing it. I don't mean just around the SAP environment, I mean in general. And I think we all knew that it's going to happen and we've been kind of waiting for it to happen. The rate at which it seems to be happening is amazing, if you will, and something that I think we all better get used to. You know, just to comment on David's point and your point, Tony, I think what's most amazing to me is two things. One is the inflection point that we're in, at least I'm 47 years old, so I can remember the days when, you know, the PC revolution to see, that's my generation. And then client server came, everyone talks about oh, we're a client server. I think this is an impact that's going to double both of them individually. But if you combine the PC revolution and client server together, that's the power of the neutron bomb that's hitting today, which is, and it's happening fast. So that's kind of one amazing thing that I'm seeing, kind of that come around the corner. But to the race car example, to me the other amazing thing that I think and I see is that if you think about that race car, this is going to relate to something that's usually about your business opportunity, is that if that's a business, the race car is a company. We can now, for the first time in the history of business and the world, measure everything. Everything, Google I.O., they're measuring the steps of people that they're taking. So imagine what you can do and what that's going to do to the value chains in the companies. So, you know. New models, new, yeah. I interviewed Brian Gallagher at EMC World who's running the Symmetrix Group and he's running the group that's, quote, dying, right? Symmetrix is the old drives, right? The tin, the box. He grew 10%, I mean, he's growing the business. So, the world is changing. It's still going to mean more storage. They'll be more virtualization, so maybe less physical server, there's more horsepower. So again, all the resource issues are being discussed. But again, we have this massive tsunami where everything's being measured. So I just think that we haven't even seen the tip of the iceberg of the user experiences and the business value conversation. It's really, really amazing. And I think that's going to increase the startup volume. It's going to increase the kind of the big, the big, you know, the Fortune 100s and Fortune 500s. So it's just unlimited opportunity. It really isn't. For us in the business, you talked about earlier, when you look at the business model transformation, the whole innovators dilemma dynamic, right? Introduced by Clayton Christensen. I mean, in our model, outsourcing, consulting, managed services, we've just embraced the commoditization of the platforms. And it's really a race to the top for us. And some organizations, it's a race to the bottom. It's a race to the bottom. But for us, we're embracing what's being done to automate and to create ubiquity. And we want to build value on top. And it's really at the app business process layer by industry where we're going to be able to add the most value. You know, and I think in the transformation, you have the players and the pretenders, right? And to me, my filter is very, very clear when I have talked to folks in the cube. It's, you know, are you a tech athlete? Are you actually innovating or are you just going through the motions? And you can really, in this market, pretty much find that out pretty quickly. So you guys are really doing great. We really appreciate you coming on the cube, Tony and David. This is theCUBE. We are here in the Global Communication Center. We're co-innovation between EMC and CSC is thriving and amongst SAP. We are in the Global Communication Center live at Sapphire. This is theCUBE. We'll be right back with our next guest after this short break. Great.