 Live from San Jose in the heart of Silicon Valley. It's theCUBE, covering AWS Summit 2016. Hello everyone, welcome to theCUBE here live in Silicon Valley at Amazon Web Services AWS Summit in Silicon Valley. I'm John Furrier, this is theCUBE, our flagship program. We go out to the events and extract the signal from the noise. I'm here with my co-host, introducing Lisa Martin on theCUBE. New host, Lisa, you look great. Our first guest here is David Richard, CEO of WAN Disco. Welcome to theCUBE, good to see you. Good to see you, John, as always. So I promise, special CUBE presentation, $20 bill here that I owe David. We played golf on Friday, the first time out in the year. He sandbagged me, he's a golfer, he's a pro, I don't play very often. There's your winnings, there you go, $20, I paid. Wah! He's not a real challenge this way. So you know, it's been paid. Great fun, good to see you. It was great fun, and I'm sorry that I cheated a little bit. Mirror in the bathroom, still running three areas. I love the English style, they liked all the intergame and playing music on the course, it was a great time. But we were at golfing last week, we were talking, just kind of have a social get together, but we were going to talk about some things on the industry mind right now, and you had some interesting color around your business. We talked about your strategy of OEMing, your core technology to IBM, and also you have other business deals. Can you share some light on your strategy at WAN Disco with your core IP, and how that relates to kind of what's going on, this phenom called Amazon Web Services. They've been running the table in the enterprise now, and certainly public cloud for years, $10 billion, Wikibon called that three years ago. We see that trajectory not stopping, but clearly the enterprise cloud is what they want. Do you have a deal with Amazon? Are you talking to them and what does that impact your business? Well, I mean, the wonderful thing is if you go to AWS Marketplace, you go to their front page, we're one of the feature products on the front page of the AWS Marketplace. I think that tells you that we're pretty strategic with Amazon. We're solving a big problem for them, which is the movement of data in and out of public cloud. But you asked an interesting question about our business model. So we saw, when we first came into the whole big data marketplace, we went for the whole direct selling thing like everybody does, but that doesn't give you a lot of operational leverage. I mean, we're in accounts with IBM right now. You mentioned OEM, our technology. At a big automotive company, they have 72 enterprise sales guys, 72. We could never get to that scale anytime soon. I mean, relationships, too. So it's not like they're like, you know, just knocking on doors, selling used cars. They are strategic high-end enterprise sales. Exactly. So that gives us a tremendous amount of operational leverage. And AWS is one of the great stories. It will be one of the great IT stories of the century to go from zero to 15 billion if AWS is an independent company faster than any other enterprise software company in the history of mankind is just incredible. Yeah, well, enterprise, they care about hybrid cloud, which you know all about through your IBM relationship. Andy Jassy at Amazon, the CEO now of Amazon, newly announced title is certainly SVP. Basically, he's been the CEO of Amazon. He's been on record, certainly on stage and on theCUBE saying, why do even companies need data centers? That kind of puts you out of business. Do you have a data center product or is the cloud just one big data center? Will there ultimately be no data center at all? What's your thoughts? That's a great question. We see the cloud as just one great big data center. Actually, many great big data centers and how you actually integrate those together, how you move data between data centers, how you arbitrage between cloud vendors. Are you really going to put all your eggs into one basket? Are you going to put everything into AWS, everything into Azure? I don't think you will. I think you'll need to move data around between those different data centers. And then how about high availability? How do you solve that problem? Well, one disco solves that problem as well. So a couple of questions for you, David. One of the things that Dr. Wood said in the keynote today was friends don't let friends build data centers. So I wanted to get your take on that as well as from an IBM perspective, we just talked about the OEM opportunity that you're working there to get to those large enterprises. Does that mean that you're shifting your focus for enterprise towards IBM? Where does that leave when disco and Amazon as we see Amazon making a big push to the enterprise? So I think there was some big news that came out last week that was missed largely by the industry, which was the FCA, the financial regulatory authority in the United Kingdom came out and said, we see no reason why banks cannot move to cloud from a regulatory perspective. That was one of the big fears that we all had, which is are banks actually gonna be able to move core infrastructure into a public cloud environment? Well, it now turns out they can. So we're all in on cloud. I mean, we can see if you look at the partnerships that we're focused on, it's the sort of four slash five cloud vendors. It's the IBM, the AWS, Azure, Oracle when they finally build their cloud and so on. That's, they're the key partnerships that we see in the marketplace. That will be our go-to-market strategy. That is our go-to-market strategy. So one of the things that's clear is the data value and you do a lot of replication. So one of the things that, I forget which CUBE segment we've done over the years, that's Hurricane Sandy. I think it was in New York City. You guys were instrumental in keeping the uptime and availability. Lisa mentioned Amazon Visa, VIBM. I'll see two different strategies kind of converging in on the same customer. Amazon's had problems with availability zones and they're rushing and running like the wind to put up new data centers. They just announced a new data center in India just recently, Andy Jassy and team were out there kicking that off. So they're rushing to put points of presence if you will for lack of a better word around the world. Does that fit into your availability concept and how do customers engage with you guys with specifically that kind of architecture developing very fast? So I think that's a really great question and there are problems or have been historic problems with availability, general availability in cloud. There are lots of 15 minute outages and so on that cost billions and billions of dollars. We're working very closely and I can't say too much about it with the teams that are focused on enabling availability. I mean clearly the IBM OEM is very focused on the movement of data from a hybrid cloud and from a data availability perspective. But there's a great deal of value in data that sits in cloud and I think you'll see us do more and more deals around general cloud availability moving forward. Is there a specific on that front project that you can share with us where you've really helped a customer gain significant advantage by working with AWS and facilitating those availability objectives, security compliance? So one of the big use cases that we see and it's kind of all happening at once really is I built an on-premise infrastructure to store lots and lots of data. Now I need to run compute and analytics against that data and I'm not going to build a massive redundant infrastructure on-premise in order to do that. So I need to figure out a way to move that data in and out of cloud without interruption to service and when you're talking about large volumes of data you simply can't move transactional data in and out of cloud using existing technology. I mean AWS offers something called Snowball where you put it into a ruggedized drive and then you ship it to them but that's not really streaming analytics is it? So most of our use cases today are involved in either the migration of data from on-premise into cloud infrastructure or the movement of data from a temporal basis so I can run compute against that data and taking advantage of the elastic compute available in cloud. They're really the two major use cases that we're working with a lot of customers right now that have those exact problems. So a majority of your customers are more using hybrid cloud versus all in the public cloud? Hybrid falls into two categories. I'm going to use hybrid in order to migrate data because I need to keep on using it while it's moving and secondly I need to use hybrid because I need to build a compute infrastructure that I simply can't build behind firewall. I need to build it in cloud. So the new normal is the cloud as tweeted it was a tweet here that says database migration now we can have an Oracle Exadata database that we're ready to throw into the river. Database migration is a big thing and you mentioned in the first question that moving in and out of the cloud is a top concern for enterprises. This is one of those things that's the elephant in the room so to speak, no pun intended aka Hadoop but moving the data around is a big deal and you don't want to get a Roche Motel situation where you can check in and can check out that is the lock in that enterprise customers are afraid of with Amazon. Your thoughts there and what do you guys offer your customers and if you can give some color on this whole data based migration issue, real not real. So the big problem that the Hadoop market has had from a growth perspective is applications and why they had a problem? Well it's the concept of data gravity so the way that the AWS execs will look at their business the way that the Azure execs will look at their business at Microsoft they will look at how much data they actually have data gravity. That's the implication being if I have data then the applications follow and the whole point of cloud is that I can build my applications on that ubiquitous infrastructure. So what we're doing, I mean we want to be the kings of moving data around, right? So wherever the data lands is where the applications follow. If the applications follow, you have a business if the applications don't follow then it's probably a Roche Motel situation as you so quaintly put it but basically the data is temporal it will move back to where the applications are going to be. So where the applications are and who's going to be the king of applications will actually win this race? So question in terms of migration we're hearing a lot about mass migration Amazon's even doing partner competency programs for migration, not to trivialize it talk to us about some of the challenges that you're helping customers overcome when they sort of don't know where to start when it comes to that data problem. If it's batch data if it's stuff that I'm only going to touch if it's an archive that I'm only going to touch once in a blue moon then I can put it into Snowball and I can ship my Snowball device I can sort of press the pause button akin to when I'm copying files into a network drive where you can't edit them and then wait for two months, three months and wait for them to turn up in AWS and that's fine. If it's transactional data where maybe 80% of my data set changes on a daily basis and I've got petabyte scale data to move that's a hard problem that requires active transactional data migration. That's a big mouthful that's really important for runtime transactional data. That's the problem that we solve. We enable customers without interruption to service to move at massive scale active transactional data into cloud without any interruption to service. So I can still use it while it's moving. One of the things we were talking about before you came on was the whole global economy situation. I think a year and a half ago or two years ago you predicted the housing bubble bursting in London like a year in the London exchange with your public company, Brexit EU. These are huge issues that are going to impact certainly North America looking healthy right now but some are saying that this is a big challenge and certainly then certainly of the US presidency candidates that are lack of thereof the general sentiment in the US we're in a world of turmoil. So specifically the Brexit situation you guys are in London what does this impact your business and is that going to happen Give us some color and insight into what the countryman is thinking over there. Okay so I get asked by, I live here of course and I've lived here for 19 years it feels like I'm re-colonizing sometimes I have to say no I'm joking. I get asked by a lot of Americans what the situation is with Brexit and why it happened and for that you have to look at economics and if you sort of take a step back in Northern Europe nine of the 10 poorest parts of Northern Europe are in the UK and one only one of the top 10 richest parts in the UK and that's London. So basically outside of London the UK has a really big problem those people are dissatisfied when people get dissatisfied if they're not benefiting from no economic upturn if governments make it like the Conservative government for the past four years made huge cuts those people don't benefit and they really feel pissed off and they will vote against the government. So a protest vote pretty much? So for Brexit was really I think a protest vote it's people dissatisfied it's people voting basically anti-immigration which is being in the US is a real foreign thing to us. But there are some implications to business I mean honestly there's filings there's legal issues, obviously currency have you been impacted positively negatively and what is the outlook on when this goes business going forward with the Brexit uncertainty and or impact? So we're in great shape because we buy pounds so we buy labor that's now discounted by 20% in the UK just got back from the UK if you wanna go on vacation Americans anywhere go to London this summer and go shopping because everything is humongously discounted for us Americans right now it's a great time to be there so from a one disco perspective I like the housing bubble too. Oh well I said to you about a year ago that the London housing market was akin to the jewelry shops that existed in Hong Kong a few years ago where the Chinese used to come over basically laundered money by buying huge diamonds and bars of gold and things. If you look at the London housing market it is primarily fueled by the Saudis and by the Russians who have been buying high-park corner, 100 million pounds, 160 million dollars well, 140 million dollars now apartments and so on in London. Now seven and I repeat seven housing funds in the UK last week cancelled redemptions which means that they can foresee liquidity problems coming in those funds. I think you're about to see a housing crash in London the like of which we've never seen before and I think it would be very sad and I think that will make people really question the Brexit decision. So sell London property now people. Yes. And go shopping I heard the go shopping. So following along that you talked about the significant differential between London and the rest of the UK. You're from Sheffield you're very proud of that you've also been very proud of your business really helping to fuel that economy. How do you think Brexit is going to affect Wendyskow in your home area of Sheffield? I don't think it really will. I think our employees there are relative terms very well paid, they're working on interesting things they're working very closely with the AWS team for example the S3 team, the EMR team and building our technology we're liaising very closely with them they're doing lots of interesting things. I suspect their vacations into Europe and their vacations to the United States have just gone up by about 20% which will reduce the amount of beer that they can drink it's a big beer drinking part of the world in Sheffield. But no it's Sheffield is a terms of cost of living is relatively low compared to the rest of the UK and I think those people will be pretty happy. David I really appreciate you coming on theCUBE I want to give you the final word here on the segment because you know you're a chief executive officer of a public company you've been in the industry for a while you've seen the trials and tribulations of the Hadoop ecosystem now basically being branded the data ecosystem as Hortonworks has recently announced Hadoop Summit is now being called DataWorks Summit they're moving from the word Hadoop to data clearly that's impacting all the trends cloud data, mobile is really the key. I want you, I'm sure you get this question a lot I would like you to take a minute and explain to the audience that's watching what's this phenom of Amazon web services really all about what's all the hubbub about why is everyone you know fawning over Amazon now when you go back five years ago or 10 years ago when it started you know they were ridiculed I mean and you know I remember when they started I loved it but they looked at it as just kind of a tinkering environment now they're the behemoth and just on an unstoppable run and certainly the expansion has been fantastic under Andy Jassy's leadership how do you explain it to normal people what's going on in Amazon take a minute please so Amazon is and that's a brilliant question by the way Amazon is the best investor relations story ever and I mean ever what Bezos did is never talked about the potential size of the market never talked about this thing was going to generate lots of cash he just said you know what we're building this little internet thing it might not work it's not going to make any money and then in the blink of an eye it's a 15 billion dollar revenue business growing faster than any other part of his business and throwing off cash like there's no tomorrow it is just the most non-obvious story in technology, in business of any public company ever I mean AWS arguably as a stand-alone entity is almost worth as much as Oracle an unbelievable an unbelievable story and to do that with all the complexity I mean running a public company with shareholder expectations with investor relations where you have to constantly be positive about what's going on for him to do that and never talk about making a profit never talk about this becoming a multi-billion dollar segment of that business is the most So they've been living the agile certainly that's the business story but they've been living the agile story relative to announcing a slew of new products basic building blocks S3 EC2 to start with as the story goes from Andy Jassy himself and then a slew of new services it's a tsunami of every event of new services what is the disruptive enabler what's the disruption under the hood for Amazon how do you explain that? Well, I mean what they did is they took a really simple concept they said, okay, storage how do we make storage completely elastic completely public in a way that we can use the public internet to get data in and out of it right? That's a sound simple what they actually built underneath the covers was an extremely complex thing called object store everybody else in the industry completely missed this Oracle missed it Microsoft missed it everybody missed it now we're all playing catch up trying to develop this thing called object store it's going to take over I mean somebody said to me what's the relevance of the duping cloud and you have to ask that question you have to, it's a relevant question do you really need it when you've got object store show me side by side object store versus every, you know NetApp or Teradata or any of those guys show me side by side the difference between the two things there ain't a lot Amazon Web Services is a company that can put incumbents out of business David, thanks so much as we always say, what inning are we in? We think it's really a doublehead Game 1 swept by Amazon Web Services Game 2 is the enterprise and that's really the story here at Amazon Web Services Summit in Silicon Valley can Amazon capture the enterprise their focus is clear we're the cube I'm John Furrier with Lisa Martin we'll be right back with more after this short break