 Live from Las Vegas, Nevada, it's theCUBE at IBM Edge 2014. Brought to you by IBM. Now here are your hosts, John Furrier and Dave Vellante. Okay, welcome back everyone. We're live in Las Vegas for IBM Edge. I'm John Furrier, the founder of SiliconANGEL, my co-host Dave Vellante. This is theCUBE, our flagship program. We go out to the events and distract a signal from the noise. Our next guest is Laura Guillo, VP, business line executive of STG of IBM. Welcome back to theCUBE, great to see you again. Nice to see you too, thanks for having me. IBM's transformation going down with the infrastructure matters. So tell the folks out there, why is infrastructure a matter, what's the key message, and how does that tie into some of the changes you guys are rolling out here with the customers? So one of our big announcements that we've had this week is around software-defined storage and elastic storage. And really this is giving customers capabilities of taking all the advantages of the technology that we have in IBM storage. And being able to utilize that in a software lay-down fashion. So they can pick the hardware that they want to run it on. You know, Tom Rosamilia yesterday spoke about hardware. You got to have it. Whether or not, you know, you want it packaged as an appliance or not, we're giving the customer the ability and choice to do it the way that they want to do it. I saw Tom last night at one of the customer events and we were talking about infrastructure going away. And before I could get the word out, before I could get the word out, I said infrastructure is never going away. You can't have a software-defined data center without having a data center. I mean, so, I mean, it's kind of fun to have the software-defined messaging out there, but it is important. You still got to have the gear. You got to have the systems and the process. And certainly the legacy environments out there do pose a challenge. So I got to ask you, with that in mind, what do you, what conversations are you having with customers around that conversation? Because it's pretty clear. They understand software. They see software-defined networking. They understand virtualization. They see the path. What are some of the conversations you have with that roadmap, that journey to that hybrid data center and so on? Well, first and foremost, they're talking about, they appreciate the fact that they're getting choice. That we're not defining and boxing them in, and I didn't mean that as a pun, and the hardware options that they have available to them. So they can do things with software that free them up from doing virtual deployments of software and not having to be cornered into a hardware appliance that maybe they don't want to run. Maybe they've got hardware in their infrastructure and a baseline that they're running that they can continue to lay the software down on. So the software-defined message sounds good. Customers like that, hey, you're not going to get locked in. You can run your storage on commodity hardware, and we'll layer the software on top of that. We'll be able to control it and so forth. But there's a but, and I wonder if you could give us feedback as to what customers are telling you. Because the stuff they've been running for years works. It's really functional. It's got robust stacks that are hardened, and all the software-defined stuff is new. So is there fear, trepidation, concern that the new stuff isn't going to work as well as the old stuff? It's going to take some time to mature. Maybe they're putting it on certain workloads. What are you hearing from customers in that regard? Well, you know, one thing we're not going to do is box them in to only being able to move forward with software-defined. We're still going to offer them the appliance approach that we have now with the hardware and software coupled together. And when you look at technologies like DS8000 on a Z system, you know, that is so intertwined into the microcode that those are things that I see continuing on as a total package to a client. As you move farther down the spectrum here on what clients are doing with the software, we absolutely want to give them the choice. But we're not going to say it's not going to work with the old stuff. We're making sure that the design points that we're putting in says what you have today will work with what we have coming out into the future. Okay, so basically your message to customers is the stuff you have today is going to fit into a software-defined strategy. And then what? Over time, that function will get more robust on the software side and eventually we'll get there. This is the vision that we're putting forth to the future. Exactly. So how does that resonate with customers? What's their feedback? Well, you know, it's really interesting. If you talk to the high-level C-suite executives, they're very excited about this approach that we're taking. Now when I go meet with the engineering teams in the offices, they're a little slower to say, well, wait, don't disrupt my data center at the moment. So we're making sure with the design points that we're putting in that the C-suite's satisfied with the direction that we're taking while we're not disrupting the business that they're running today. Are you seeing some of these trends sort of coincide with we always talk about hyperscale bleeding into the enterprise and John talks a lot about the DevOps movement. We talk a lot about it on theCUBE. Are you seeing the sort of software-defined storage trends coincide with some of those? Or is that still taking shape in the enterprise? I see it definitely coinciding here. I see that the simplification that you can put into an infrastructure and not having the operations team separate from the development or from the data center team, from the engineering team, being able to put all this together in a seamless approach and bringing down those barriers between the individual organizations within a client's data center. And when you can do that, then they can go work on the business at hand and not focus on how do I keep this thing up and running. So as somebody who's got, you got to hit your plans and you got to meet your targets. You got to deliver value. You have all these disruptions going on. You got software-defined. You got flash, certainly replacing high-speed disk because high-speed disk is becoming an oxymoron. What's IBM's sort of attitude approach toward those types of disruptions? Is it drive as hard as you can to bring those new technologies to the market? Do you not want to go so fast because it'll maybe cause too much disruption? How do you approach that? Our approach is really to drive the leading edge technology as it comes out without disrupting what a client has in the data center today. The worst thing that we can do is introduce new technology and not make what they currently have today work within their environment. So the objective is to get the new stuff in there, give them the leading technology with least disruption as possible. I wonder if we could talk about shift gears a little bit. One of the things we talked about at the first edge that we ever did was sort of IBM's R&D emphasis and innovation. We had some executives on. What do customers think about that? Why is that important to customers and how does that translate into product? Well, customers recognize the fact that IBM has had 22 years of patent leadership in the world and that does not go unnoticed. Clients recognize the fact that the research that we put into our product sets really are leading the future for not just IBM, but the whole industry. So what if we could talk about competition? Sometimes you don't like to talk about competition because you want to talk about the customer and focus on business value, but it's a competitive marketplace. So how do you differentiate why do customers buy from you and what's different about IBM from the competition? Well, first and foremost, it's the breadth of solutions that we can provide to a client. Taking things that's not just storage itself, but taking software group products into account and giving a customer an end-to-end solution. Not the artificial barriers of just storage, but the breadth of what are we trying to solve for a client? Nobody in the industry has that ability like IBM. What are customers saying about the Lenovo deal, the X86 business going into Lenovo? Excitement, concerns, what are they excited about? What are they concerned about? Well, early on there was a little trepidation as to what was going to happen there. I think over time we've been able to calm those fears. It's a great opportunity for me, particularly in storage, in working with Lenovo and reaching some of the markets, particularly in the low-end portfolio, that we've not been able to reach really well in the past. It's interesting, we've talked to some sales guys last night. We always like to go out to the events and kind of dig into what's going on. Actually, there's no bump in the road on the Lenovo situation because of the relationship that's been there in the past, so we've heard anything, no cracks in the foundation, so to speak, on that business. Do you see the same thing? Is it kind of a groove swing at this point? Absolutely, you know, we're working hand in hand with Lenovo as the transfer takes place and what we can do from a storage perspective, particularly around the V3,700 and V5,000 and then really going after a lot of that market in China that Lenovo's got cornered there. So I got to ask you about the cloud question. I'll see some stuff on Twitter going on, questions coming in from the crowd chat about, you know, how does all this intersect into the crowds? So I'll see Softlayer, we read Pulse and before that, I mean Impact and then Pulse before that. I'll see Softlayer, Blue Mix, all that stuff's going on, but the cloud is a destination, it's part of the agenda. How do you weave that into the story with this show? Well, some of the things that we're doing around XIV, particularly with MSPs here, and offering them the ability to buy a product at whatever level they want to purchase it out, reducing the overall cost as an entry and then upselling any features or things that they particularly want. So we're tailoring it more to what a client's looking for in cloud. The other interesting thing that I'm hearing around cloud is tape, and you know, and how tape's going to play a big role here in the future with cloud? Tape, tape is back. Tape was never gone. People want it to be gone, but it's one of those things, but it brings up the question of latency, obviously flash, talks on the other side of the spectrum, and tape on the other side. Do you have, you know, the turtle and the hare and the tortoise kind of going on, but it's still relevant mainly because one, legacy isn't it just still cost? Is it a cost issue? What's the driver? Why is it still around? Well, overwhelming amounts of data. You know, we've talked about it for a long time now and the data growth in the industry. Clients can't afford to keep all this stuff online on spinning desk. We're coming up with technologies, we're working with things through research of how do we intersect tape technology more closely with what we're doing with flash, and then how that works into a cloud environment. How you get SLAs in a cloud environment that allow the utilization of tape, but still be able to access that data using metadata and other things like that. I want to add something to that discussion if I may, John. So there's actually, tape actually gets better with time than disk, so disk bit error rate is I think 10 to the minus, I want to say 15. Tape is two orders of magnitude more reliable over time, so tape's no longer the primary backup medium, as you know. It's really become a long-term retention and it's cheaper, and if you marry it with the hair, John's idea, David Florek calls it flake, flash, and tape, it actually can be faster for certain workloads, like facial recognition. Well, throughput and cost per gigabyte is always a concern. When you look at the overall architecture, latency on transactional stuff's important, flash is good for that. So again, I don't think it's a one-size-fits-all. Certainly you know in the storage business, you can't just say all flash and that's the end game. So certainly there's a mix there. You see, you agree, right? I absolutely agree that, you know, for the certain clients that are out in the industry, I think there's a great opportunity here of marrying tape and flash, and really being able to apply that to customers and keeping costs down. Laura, it's great to see you here back in theCUBE. I want to give you the final word in the segment. Tell the folks out there, actually there's a lot of IBM shows and certainly you guys have kind of consolidated and they're messaging, they're all nice and buttoned up now, but why, Ed, what's going on this week that's so important? Share it to the folks in your own words. Why is it so important at this time in history and IBM and the industry and overall here at IBM Edge? Great, great, well, you know, this is 25 years I've been in this industry and I've seen a lot here in storage. This is the first time I've seen the breadth of a portfolio be updated like we've done this year with our technology. We are leading the forefront in what the possibilities are around storage, what clients can gain to solve problems within their data centers. And this is unprecedented in what we put out this year. The speed, applications, cloud mobile, social, big data, Davis, that was our editorial four years ago, now in our fifth season here inside theCUBE. Laura, thanks for coming in, Lurgie of the VP of Business Line, executive for IBM, STG, thanks for coming on theCUBE. We'll be right back with our next guest live in Las Vegas for IBM Edge, we'll be right back.