 Welcome back everyone to theCUBE's live coverage here in Barcelona. I'm John Furrier, host of theCUBE, here with Dave Vellante, my co-host, extracting the signal from the noise. We've got CUBE alumni, CUBE collective, distinguished analysts with theCUBE. It's Arbjit Jowal, who is with StackPane, founder and principal analyst at StackPane. StackPane. StackPane. StackPane. Not in plain, pain. Pain, pain of glass, or pain. StackPane. I feel the pain, or pain of glass. It's Arbjit, good to see you. Good to see you, John. Good to see you. Good to see you here in Barcelona. Thanks for coming out and on theCUBE. You have been out and about, been following on your Twitter feed. Big time, great stuff. You've got a lot of notes there. What are you seeing? What's your take of MWC? Bring it home. Yeah, I've been running around actually since Monday morning. Great dinner with you guys on Sunday. Thank you. So yeah, I think the biggest pattern is that telcos are getting digitized for a while now, but it's getting even more digitized, right? So this is what my interpretation is. Anything which turns into zero than once, compute companies, whoever is doing compute today, better. They will benefit from that. So cloud will benefit from that because I see cloud as industrialization of backend computing. So the demos at AWS were great. You know, like they are cooking up some next level stuff. Baking Jena AI into the BSS, you know, business sports systems side of things, right? So when people call in, you know, reducing the call volume and whatnot. So reducing the cost of, cogs, right, for telcos, if you will. Even on the O-RAN side or the RAN side in this case, they are doing a lot of innovation. So they gave us the tour of their telco solutions, right? IBM also gave us their, you know, what they are doing with the telcos. So I have seen, you know, I've visited many telcos. Yeah, we will jump into that. Well, let's get into it. You got the analyst notebook segment here. You've been walking around, you got the notes. What are you seeing? What's the key highlight from the IBM and these guys? What are they, what's their big pitch? The big pitch is that they are helping telcos digitize their stack, go to the next level. Monetization is key for telcos. Telcos, we talk about it all the time. They're suffering from that, right? So they are helping them build the BSS systems. And ancillary businesses. An example I will give you is with Vodafone, they did a spin out, which does help the SMB market. You know, telcos are very good with big with SMB, you know, because they serve all these, you know. It's easier to monetize. It's easier to monetize. So the one pattern is this, the telcos we know that we have talked about last year as well, the telcos are highly regulated. To innovate, their hands are tied in many ways. They can't keep the data of the user the way the other, the Googles of the world and Facebooks of the world can, right, so in order to innovate, I think spin outs is the best strategy and many telcos are doing that. I've seen that. Who's doing a spin out? I saw the Vodafone, I just gave you an example. So, and few others actually, I can't bring it up. What about 5G, what about 5G? Yeah, we heard just heard from the guys at Netscout that you know, it's definitely hitting the brakes on 5G, worldwide, you know, such huge capex and there's a $200 billion capex shortfall we saw on the paper, the key notes on Monday from the European telcos. And so, there's layoffs, hitting the brakes a little bit because there's no killer app, they really haven't found that golden vector yet. So, what have you been hearing in that front? I heard some stories around private networks, spot hospitals, right, and stuff like that. So, that, the key idea behind that is that it has better economics. You can save a lot more money because if you're doing 5G through telcos, then you're paying them a lot of money because you're going through their networks. But if you have a private network where you need to keep like 80% of your communication sort of locally, that makes sense to me. So, that's the number one thing, right? So, you're saying private 5G is the killer app of 5G? Is that right? Yes, yeah, you can say that, yeah. So, my big takeaway of here is that there's no dev talk going on. Like so, we heard also from Netscout and others that there's a lot of infrastructure going on, a lot of private 5G, the mobility story between Kindle and HPF, that was a great announcement. So, you got this idea of seamless mobility between private environments, private AI, public networks for, so you don't lose date if you've got a package on a truck, you can connect up, so I just love that. Love that, friend. The other thing I'm seeing is that when we had the Broadcom's CEO on, the, the- President. President. President. President. President. I can't seem to see you. That the architectures for service providers are changing into clusters, not so much data centers, they're turning into like super clusters. He actually used that term, Charlie, at Broadcom. So, that's one, and then the other one is, is that who writes the apps? So, you got open, you got the open model, the Linux Foundation, they're trying to create an open system where the Telco API, we had the chief technologist from AWS on said, the Telco should be an API, like the data was an API. He was very optimistic about what's happening. I then said, is it- Build the API and there will come, was his philosophy. Well, I then said, well, I said, well, where's the develop, where's the APIs? Well, it's in reference implementation. It'll all happen. Well, Dave, well, where is it? When we hear reference implementation, what does that mean? We hear what? When we hear reference implementations. Well, it's like a reference architecture. Yeah. What does that mean? It means it's not ready yet. It's not ready yet. It's getting ready. Like it will take a while for this old industry to adopt, right? Like we have to give them some time. Last year, remember we loved to have two APIs? Yeah, yeah, yeah, right. GSMA said like, oh, we have lost this open API, you know, like for Telcos and they had two APIs. And this year is like a 99, I think, total. Yeah. So that's the start, right? That's a good start, yeah. And yeah, another pattern is that- Next comes the apps. Yeah. Well, how many apps are we talking here? That's what things subject. Last year was two. This year it's 99. Maybe next year it'll be, we'll hear about the apps. Yes. Well, the open gateway initiative, I want to hear more. I want to see the open gateway initiative be successful. Okay, they had 47 mobile operators. Okay, that represent 237 mobile nodes, including a lot of the MVNOs. So if they get those networks connected, then you open up observability data for NetScout. You open up app developers in the cloud already. Because the problem that the Telcos have, Dave, and the enterprises is that we know this, the developers got to come from the consumer side, not the business side, because 5G slicing is not available yet. So that's- Charlie Kowals made that point too. So it'll happen in the consumer market first. He was talking about AI, but he's right. So Amazon and Azure, mainly Amazon, Azure can reap some more, for sure. Because the developers in the cloud will make it happen, because that's where the agility is, that's the speed, time in the market. If the Telcos could make their stuff compatible with all the table stakes needed for cross-cloud, super-cloud observability, then you're going to have a winning hand. Otherwise, if not, the developer apps will be proprietary for this network, for that environment. No, I think it's all great to dream about big things. But remember this one thing, the Telcos is a utility. Telco is a utility, just like electricity is. That's how it's marked in government regulators. That's how they see it. The reason is, because everybody has a right to Telco, if you will. So they have to serve the population of their countries, the whole world, getting nine billion people now, right? So- Okay, so I'm dreaming then. Nine billion people, five billion connected. But my dream is vision, obviously, but let's take the Telcos. That utility provides that today. What needs to happen next? What needs to happen next is, they need to provide that utility on top of that because they're serving two sides. They're serving the population, everybody, right? Masses, and also the small and medium businesses. And also big businesses in a minor way, I think, personally. I think big businesses sort of use the bigger networks, or networks which are owned by Google, and- Yeah, so they're serving the, you said they're serving businesses in a kind of minor way, meaning the cloud guys are serving businesses directly. Exactly. The Telcos are maybe serving some small businesses and obviously homes. And of course they're serving the OTT vendors and the cloud vendors who are riding on top of their network. I think the key is the collaboration. Anybody who's collaborating with the likes of Amazon, likes of VMware, likes of Microsoft, I think those Telcos are doing good and they will do better, I think, going forward. Because they can, I used to work at Visa. Visa is also kind of sterility, but the Telcos are even lower level sterility, if you will. So they had to work with all the banks and all over the world and we had to go with the lowest common denominator in technology stack, right? So the good thing is that Telcos are localized by the country and their economics, Telcos' economics sort of mimics the economics of the country, if you will, right? So of the population. Another pattern is- So you think you see that as a positive? Yeah, right? But it sounds like the European Telco CEOs are pushing for more consolidation. You would think they would want to buy up some of those local, you know, because in part I see what you're saying, but isn't it also, doesn't it make that Telco more insular, more of a local monopoly, less innovation, less ability to scale? So I mean, I think that's two-sided there. Yeah, Telcos are also going to this national security kind of aspect, you know, like the calls need to stay within the country, but now with the roaming and all that stuff, the calls are, that was one of the demo AWS showed, if I'm making a call to you here, it has to go to US Network and come back to you here. The data travels there, because everything is data and our calls are data. So, but they are trying to route the call from the local sort of right from here, so you, we can talk, it doesn't hit US, and you don't pay it more for that network. So, for example- You know, you remind me of something, we didn't talk about this with Zeus yesterday, but in the Chuck Robbins round table, he said, oh, I'm not trying to get political, but if Trump gets elected, and he implements some of the things that he wants to implement in terms of, you know, local restrictions, that's going to be a nightmare for the entire industry to be able to figure out from a compliance standpoint. I don't understand what he means by that. Yeah, well, he was saying that, well, I guess Trump's been saying, I don't really completely understand it either, but I guess he's been saying that if he comes in, he's going to place more restrictions, export restrictions and the like, and sovereignty, data sovereignty, you know, restrictions would likely be the reciprocal, you know, response, and that would just make it really hard for companies to figure out what they can and can't do, and they have to comply to that, that's an expense, and it's one that he clearly didn't want to absorb. Irrespective of the politics of it was his point, but he brought it up several times. So that- I've just waited four years until he's out. Yeah, well, my question was, and I didn't get an answer to it, was can that happen with an executive order? But I don't know. Sorry, I digress. No, another pattern is- That's a rant, Dave, for the podcast. Yeah, well, right, there you go. I think they understand the complexity of the situation. We have to understand the bigger patterns, right? Another big pattern is this, that the telcos, again, we talked about earlier, that they serve the regions or the countries, right? But likes of AWS, likes of Google, likes of Microsoft, they are global companies. So Microsoft serves like 99% of the globe, right? But Italico cannot. So that's the trick, that's why they can't innovate. The utility side plus that point, I think, is a big- Right. Big point. Exactly, the point I was saying before is they're localized, right? They're restricted from doing crossing borders. There will definitely be opportunities for them to leverage Amazon to leverage them because when they want to come down to the local zones and local regions, they're going to segment the market. Okay, but the big telcos in the United States can, in theory anyway, they can certainly be Pan North America or Pan America. Can they be global? Sort of, there's certainly no restriction from them competing globally. They're just not in their DNA. Yeah, actually DT serves, like DT went to US and they bought T-Mobile, right? That's what they come, right? And then things are there. If your country is friendlier with the other country or your region, EU is friendly with US, for example, right? Then you can do these things. That was one of my questions for AWS folks yesterday. They were, day four yesterday, they were bragging about, oh, your call doesn't have to go all the way to US and you can just talk here. It's like, no, no, no. Not if the country is Iran and US. Yeah, yeah, yeah, yeah, yeah. So they are still like boundaries. You know what else struck me? We haven't talked much about it. We talked a little bit, but the whole perception of this at the show and the presence of companies from China. Startups, the booths from many of the Chinese companies. China Mobile, obviously big keynote speaker, Huawei's huge, huge presence at the show. The world sees China differently, you know, outside of the United States. And it's, they're really a major innovator here. They're driving whether it's private 5G, O-RAN, AI. I mean, it's just amazing the innovation that you see and some of the biggest booths that we see here and startups, you were saying hall eight is full of startups as well. Yeah, actually. A lot of them I would imagine are from China. Yeah, there are a lot, I saw less Chinese, but a lot from other parts of Asia and Latin America because it's the way we're sitting kind of thing, right? And of course, Spain and many U.S. companies were there. I met the guy from Stanford who was presenting. You must have seen my tweets, right? Like they were presenting how telcos can help the hospitals and all that stuff. So that was a great panel. I was there for a couple of those sessions. The long story short, if you go to, okay, last year I wanted to go to a hall eight. I couldn't make it because I got busy in these. It's so huge folks, like if you're here, if you're not here, you can't guess how big this show is. Explain the order of magnitude, just give a taste. It's 95,000 people, we are told, but it's not the people, it's how big the booths are and how the halls are laid out. So there's hall one, two, three, and then four and five are parallel and this is the hallway in between those. And it's upstairs, just downstairs. Upstairs and downstairs as well. Okay, the best way to get next, if you're first time here, you will make this mistake which I made last year. Like I was walking around downstairs, like to go from hall one to four. No, no, no, don't do that. Go upstairs and it's much easier to walk through. Because less people, a little less, upstairs is the meeting rooms, but they're upstairs. Salesforce has a big presence upstairs and service now has a big, you know, long. I heard someone say yesterday, it feels like going to Costco on a busy Saturday. The difference here too is like, but if you remember, I didn't go to CES, but I imagine it's spread out all over Las Vegas in different hotels and it makes it even harder. Here at least everything's connected. It's like the Hanover in Hanover Square. Yeah, hall eight is like four years from now. It's all startups, it's called 4YFN. I knew that there are startups in number eight, but when I saw 4YFN, I was like, what the heck is that? I asked many, but they couldn't tell. It's four years from now. By the way, I want to see that, by the way. Thanks for bringing it. I want to check it out. I want to get your thoughts on a tweet you said earlier. So a couple of hours ago, you just did the whole tour with eight years, which you mentioned earlier. Here's your tweet, your point of view. Public Cloud has just started to flirt with Telcos comma. There's a lot more to come in the few months and years. Okay, let me mention those years and ones. What do you mean by the flirting? That's the story here that I'm seeing is that this has become a cloud data show. Yes. Cloud in the sense of distributed computing, architectures are coming to Telco. Telcos are still in charge with their value proposition, hence their position, as you pointed out, as a utility, but they got data. So now that the clouds are coming into the scene, what specifically do you see in terms of the cloud-Telco relationship? How would you describe that? Are they buddy buddies? Are they shaking hands? Are they staring at each other? Are they dancing? I mean, what's the partnership with the clouds and the Telcos? I want you to describe the current vibe. Yeah, I think the current vibe is... I'm being polite. Do they hate each other or do they love each other? They are dating each other right now. So they're kind of flirting. They haven't kissed each other yet, but they're still dating. Yeah, they're like this, you know, like that. They're assessing each other, it's like, okay, where should we, can we get together? You can't blame them. You can't blame the Telcos. Yeah, right? Okay, so what do you think it goes next? Is it a good date? They go on a follow-on date? They're going to go steady? What's the worst... Yeah, I think they have to. Because of the nature of the beast, because all these communications are zeros and ones now, they have to do it that way. They can do on their own. They can try to innovate their own, but because they are all segregated, they cannot innovate at the pace where big tech can. So for that reason, they have to go to big tech, in this case, because they need that work, a lot of data is involved, a lot of compute is involved. The amount of computing involved in these Telcos, routing calls, sending calls, voicemail, all that stuff, it is huge. You have a pin tweet on the 23rd of February when NVIDIA hit two trillion. A lot of talk about where do they go from here? Is this a bubble? Is it going to burst? Does NVIDIA have a long runway? Are they going to get disrupted by all these other companies, be it the hyperscalers or other firms that are building GPUs, LPUs, other specialized PUs? What are your thoughts on NVIDIA's sustainability of NVIDIA's current mode? I think this sustainability is better than what normally what people think. The reason being that developers are with them for all these 15 plus years. Jensen says 30 years, but that's too much. 15 years is even a lot of time, right? Another thing what Jensen said when he was talking to John Ford of CNBC, actually I did that dissection of that video, right? He is going into the next business models. He's super clever, super smart guy. He's telling his story that hey, we can sustain this growth going forward, right? So the key thing what he said was all the GPUs which are out in the market, it can be two years old, three years old, four years old, or the new H100s or all the current training GPUs. So if you can train, you can do the same thing what you can do on today's GPU, on three years old, four years old, five years old GPU, but it will run slow, but you can't do the same thing. That is huge because any developer sitting in sort of a small town of India or in Africa or any part of the world, they can play with that innovation and they can do experimentation. It's not like only the rich people or the rich countries can do this. And then the point is that today's training GPUs become tomorrow's inference GPUs. And that is a depreciated asset on the books. Now, Charlie Kawas, I learned today is yeah, but the problem they'll have is energy efficiency. So that could be a wild card. I'd like to come back with that and see what Jensen would say at GTC in a couple of weeks. Yeah, I'm going to go there. Are you coming there? We'll be there, yeah. So you're a local, so you will be there for sure? Of course, I'll be there. So yeah, no, you won't be there. No? Paris, oh, dang it. I'm like, KubeCon. Oh, I guess, oh, I'm going to be in Paris for CNCS. Plus I'll go to Paris, you go to GTC. Actually, I like to go to the GTC. No, I've never missed a KubeCon. Oh, cool. So thank you so much for coming on. Where can people get a hold of you? They want to engage with you, stack pain. You're doing a lot of great research. I love when we do the research analyst notebook segment where you get all your notes. You're always scouring and turning over rocks and connecting the dots. We really appreciate you involved in our KubeCollective. Where can people get involved with you and touch base and engage? Oh yeah, first of all, I appreciate what you guys do because our thinking sort of matches. Some people think I'm part of the Kube. I'm like business. No, no, no, no, no. I just love what they do. You're in the KubeCollective, so you're in the family as far as we can see. I'm in the family, of course. Yeah, people can get to me on Twitter. I live on Twitter. I mean, I tweet like, I don't know, 100 times a day. That's why IdeaCup, like a- We got to get your Twitter handle up there. Sort of G2Haul, yes. It's just last name. First name, last name, at Twitter handle. At Twitter, yes. And LinkedIn is there as well. Email, S2Haul at stackpane.com is there. So yeah, I'm here to help anybody who wants to understand. But you're an engagement customer. And I also am a student of it. So I love these discussions. Anyone out there looking for a transformation, call Sarbjeeb. He's been a cloud architect. He's been an old school app developer. He's also an influencer now online because he's prolific. But he sees the big picture and he sees the cloud collision with Telco. He sees the cloud collision with the new apps and the super cloud. So always a great resource to tap. Appreciate your contribution to the Kube and we really value your presence and friendship. Thank you for being part of the Kube. Thank you. Thank you to all the brands I have worked with. We have Oracle, VMC, Visa, all these commerce ones, the dot com darling. I've learned a lot from those, the dot com darling. We've seen this movie before and great job. Thanks Sarbjeeb. Okay, we're back with more live coverage. We are in the Kube's Barcelona studio here in Spain, I'm John Furrier, your host with Dave Vellante. We'll be right back with more after this short break.