 Live from Washington, D.C., it's theCUBE, covering .NEXT Conference, brought to you by Nutanix. We're back, this is Dave Vellante with Stu Miniman and this is the wrap of .NEXT. Nutanix's customer event, hashtag nextconf. And this is theCUBE, the leader in the live tech coverage for enterprise technologies, Stu. Second day, yeah, I got to say, Nutanix has always done a good job. They have innovative venues, they do funky, fun stuff with marketing. We haven't seen the end of it. We have another keynote today. There's a keynote tomorrow morning. Big names, Bill McDermott's here. We just saw Peter McKay, Chad Sackich is here. Who made this thing? Diane Green was up yesterday. You know, thought leaders had CEO of NASDAQ on this morning, Dave. I mean, you know, really good customers, thought leaders. Nutanix always makes me think a little bit, which I really enjoy. My fourth one of these days, usually by the fourth show I've gotten to, it's like, I've seen it. You know, have we made progress? Where are we going? I thought Sunil Poti's comment was really interesting. He said, look, we saw the trends. We knew that, you know, hardware was going down. I mean, they're essentially admitting that they were a hardware oriented company, infrastructure company. We saw what was happening to infrastructure and hyperconverged and we could have just packed it up then, sold the company for a bunch of money. There were rumors floating around. You know, in the pre-IPO, they easily could have sold this thing for a billion plus. All could have cashed out and made a bunch of dough. And they said, you know what? We're going to do something different. We're going to go for it. You know, you got to love the ambition. And so many companies today just can't weather that independent storm. I mean, you know, you've seen it over and over and over again. The last billion dollar storage company that remained independent was NetApp. That was 14 years ago. Now, Nutanix isn't a storage company. You've got to look around here. Look at the analysts, a bunch of storage guys, you know, that have grown up. And it's, to me, Stu, it's a representation of what's happening in the marketplace. Storage, as we know it, is going away. And it always is transformed. You know, it used to be spinning disk drives. Then it was subsystems and it was the sand. And now it's evolving. These guys call it invisible infrastructure. Call it whatever you want. But it's moving toward infrastructure as code, which is just a stepping stone to cloud. So your thoughts on the event, the ecosystem and their position in the marketplace? Yeah, so, right, they reach a certain point. You know, they've gone public. You know, can they keep it innovating? You look at, you know, the number of announcements there. We spent a lot of time talking about the new, you know, cloud, XI, you know, service out there. Which? XI, XI, XI, sorry. XI, yeah. Pronunciation is some of these, it's Nutanix, right? They made jokes about the company last year. But, you know, this year, you know, that's product, we're talking vision. The ink is still drying on the relationship with Google. Doesn't mean they haven't been working for a while, but you know, where this deal goes, interest to see where it is, you know, six months from now, a year from now, because also Google, small player. I mean, it wasn't, to be honest, I was at the Red Hat Summit and they had a video of Andy Jassy saying we've got, you know, we're extending AWS with OpenShift and you're like, wow, you know, Red Hat has a position in a lot of clouds, but for Andy Jassy to make an appearance, you know, Amazon, the BMF in the cloud, that's good. Look, getting Diane Green here, I said number one, it gives Nutanix credibility. Number two, it really pokes at VMware a little bit. She's like, I did this before and, you know, everybody's like, well, she's here now at Nutanix. Nutanix wants to be that they've compared themselves to both Amazon, I think we hear it was Sunil or D-Rodge in an analyst session said they want to be like the A block, you know, not the V block that EMC did, but you know, the Amazon block for the enterprise or the next VMware, the new operating system. It's funny, in a lot of my circles, you know, we've been trying to kill the operating system for a while. I need just enough operating system. I want to, you know, serverless and containerize all of these things because we need to modernize and, you know, the old, you know, general purpose processor and general purpose operating system has come and gone. It's seen its day, but, you know, Nutanix has a play there. When I look at some of the things going, talking about, you know, micro segmentation, Dave, we're talking about, you know, multi-cloud and some interesting pieces. I like the ecosystem, I like that balance of how do you keep growing and expand where they can go into, you know, leading the customers, but you know, they're delivering today, they've got real products, they've got real growth. Sure, they have some challenges as to that competitive back and forth, but you asked Chad Sackage, if this reminded him of Dell EMC and kind of that partnership that they have for years, remind me a little bit of kind of EMC and VMware too. Once EMC bought VMware, VMware, the relationship they had, you know, HP and IBM and other companies that they needed to treat as good or better than EMC, there's some of those tough relationships and Dell with Nutanix, their partner, not only to do Dell XE, but now they're doing like Pivotal on top of it, they can do Hyper-V deployments, Lenovo's another partner. Nutanix is broadening their approach. There's a lot of options out there and a lot of things to dig into, interesting. They keep growing their customers, keep delighting their customers. Reminds me of, you know, other shows we go to, Dave, like it's Amazon re-invent, customers are super excited. You've been, you tell me about the Splunk Conference and the Service Now Conference, where those customers are just, they're in there, they're excited and Nutanix is another one of those that every year you come, there's good solid content, there's a customer base that is growing and exciting and sharing and that's a fun one to be part of. So I want to ask you about VMware. It's kind of a good reference model. EMC paid out on us $630 million for VMware, which was the greatest acquisition in enterprise IT history. I didn't know a question about it in terms of return. A couple questions for you. You were there at the time, you signed the original NDA between EMC and VMware, kind of sniffed them out. Would VMware's ascendancy been as fast and as successful or even more successful without EMC, would VMware have got there on its own? So I don't think so, Dave, because my information that I had and some of it's piecing together after the fact is VMware was really looking for kind of that company to help them get to the next date. The fundraising was a little bit different back in 2003 than it was later, but rumors were Symantec was going to buy them. Everybody I talked to, you'd know better than me, Dave, Symantec had bought them. They would have integrated it into all their pieces. They would have squashed it. The original talent probably would have fled much sooner. EMC didn't really know what they had. I worked on some of the due diligence for some of the product integrations, which took years and years to deliver and it was mostly we're going to buy them. Diane had a bit of a tense relationship with Joe Tucci kind of from day one and it was like, okay, you're out there in Palo Alto. We're on the other coast. You go do your thing and you grow and by the time EMC had gotten into VMware a little bit more, they were much bigger. So I think, as you said, Dave, one of the great success stories EMC did best and a lot of its acquisitions where it either ran a division and go or let it kind of sit on its own and just funded it more. So I think that was a great story. And the story was always that Diane was pissed because she sold out at such a low price, but that sort of ancient history. The reason I brought that up is I want to try to draw the parallel with Nutanix today and come back to what you were saying about the A block. When you look at Amazon, we agree they have a lead. Whether that lead is five years, seven years, four years, probably more like five to seven, but you know, whatever. Whatever it is, it's a lead, it's a substantive. Beyond the infrastructure, the storage and the compute, they're building out just all kinds of services. I mean, you just look at their website and whether it's messaging, on and on this database, there's AI, there's their version of VDI, there's all this big data stuff for things like Kinesis and on and on and on, so many services that are much, much larger than the entire Nutanix ecosystem. So the reason for all this background is does Nutanix need a bigger, can Nutanix become its ambition? Which is essentially to be the next VMware without some kind of white knight. So my answer, Dave, is if you look at Nutanix's ambition, one of the challenges for every infrastructure company today, if you think, okay, we talked about true private cloud, Dave, what services can I run on that? How can I leverage that? Look at Amazon, 1,000 new services coming every year. Look at Google, they've got TensorFlow, really cool stuff, they've got those brilliant people coming up with the next stuff. How do I get that in my environment? Well, Nutanix's answer coming at the show was, we're going to partner with Google. We're going to have that partnership, you're going to be able to plug in and you want to do your analytics and everything, use GCP, they're great at that. We know that you need to be able to leverage Google services to that. The Red Hat announcement that I mentioned before, another way how I can take OpenShift and bridge from my data center and my environment, get access to the services. The promise of VMware on Amazon, yeah, we're going to have a similar stack that I can go there, but I want to be able to access those VMware servers. Now, could it suck them eventually into all of Amazon and leave VMware behind? Absolutely, it's tough to partner with Amazon. So, the thing I've been looking at at almost every show this year is, how are you tying into and working with those public clouds? We talked about it at Veeamon, Dave. They have Microsoft up on stage, they have partnerships with the public cloud players. If you're not allowing your customers and the infrastructure that you're building to find ways to leverage and access those public cloud services, which, not only are they spending $10 billion a year for each one of the big guys on infrastructure to get all around the globe, but it's all of those new services, instead of moving up the stack. To stitch together that in your own environment is going to be really challenging. How many different software pieces? How do I license it? How do I get it on as opposed to, oh, I'm in the public cloud, it's a check box. Okay, I want to access that, and I consume it as I need it. That consumption model needs to change. So, I think Nutanix understands that's directionally where they want to go. I look at the calm software that they launch and say, hey, you want to use TensorFlow? Oh, it's just a choice here, absolutely, go. Where is it, and how do I use it? Well, some of these details need to be worked out, as Aditya said. It's not like it's not one click for every application, any cloud, anywhere, but that's directionally where they're going to make it easy. So, all that cool analytic stuff that we cover a lot on theCUBE, it's a lot of that's now happening in the cloud, and I should be able to access it, whether I'm in my private cloud or public cloud, and it's just going to be consumption model, whether I have certain characteristics that make it that I'm going to want to have that infrastructure for whether that's governance or locality. We talked to Scholastic yesterday, and they said, well, when you've got manufacturing and books, I need things close to where they're coming off the production line. Otherwise, there's things that I'm doing in the public cloud. So, that's where we see, when I talk to companies like I do here at the Vienna show last year, when I talked to Christian Riley with Citrix, who had been at Bechtel for many years, there's reasons why things need to live close to what's happening. We've talked a lot about Edge, and therefore, public cloud doesn't win at all. I know we had one guest on this week that said, right, depending on what industry you're in, is it a 30-70 mix or a 70-30 mix? There's a lot of nuance to sort this out, and this is a long game, Dave. There's this change of the way we do things is a journey, and do Tanix's position themselves to continue to grow, continue to expand, some good ambition to expand on the five vectors of support that they have. So, I liked what I've heard. So, in thinking about what we're talking about VMware, the imperative for virtualization was so high in the early 2000s, because we were coming out of the dot-com bust, IT was out of favor, VMware was really the only game in town. There really wasn't a strong alternative, had by far the best product. Microsoft Hyper-V was sort of, you know, in concept, and KVM and others were just really not there. So, there really was no choice. So, it appealed to 100% of the IT shops, I mean, essentially. And so, I wonder though today, is the imperative for multi-cloud the same? The fundamental is, yes, everybody has multiple clouds, but this industry has lived in stovepipes forever, and has figured out how to manage stovepipes. It manages them by, you know, fencing things off. So, I wonder, is the imperative as high, you could maybe make an argument that it's higher, but I'm still not quite getting it yet, as it was in the early 2000s, where the aspirin of virtualization to soothe the pain of do more with less was such an obvious and game-changing paradigm shift. I don't see it as much here. I see people still trying to figure out, okay, what is our cloud strategy? You know, so, I don't necessarily, number one, number two is the competition seems to be much more wide open. It's unclear at this time that any one company has a fast track to the multi-cloud. I think you've got some really good points there, Dave. I think that I've pointed out a few times is that one of the things that bothered me from the early days with VMware is from an application standpoint, it tended to freeze my application. I didn't have a reason to kind of move forward and modernize my application. Back in 2002, it was like, oh, I'm running Windows NT with a really old application. My operating system's going to end in life. Well, maybe it's time to uplift. Oh wait, there's this great virtualization stuff. My hardware's going end in life too. No, shove it in a VM, let's keep it for another five years. Oh my God, that application sucked then. It's going to suck even more in five years. And workforce productivity was weighed down. So, the vision for Nutanix is they're going to be a platform that are going to be able to help you modernize your environments. And how do we get beyond, is it virtualization to containerization? Is it a lot of the cloud native pieces? How does that fit in? Starting to hear a little bit more of it, a critique I'd have on NHCI about two years ago was it was the same applications that were in my VM were SAN, not VSAN, but my traditional storage area network was what was running on Nutanix. We're starting to see more interesting applications going on there. And look, Nutanix has a bullseye on them. There are all the HCI directory placements. There is the threat of the cloud. And I haven't heard as many SaaS applications living on Nutanix as I do when we talk to all Flash array companies, Dave, every single one of them can roll out. Here's all these SaaS deployments on our environment, just scalable environments that build that into the future, I haven't heard it as much from Nutanix. So VMware was aspirin, Nutanix originally started as aspirin and now they're pivoting to vitamin. Who are they up against? Who do you like? Who are the horses on the track? Let's analyze the race and then wrap. Yeah, so when Nutanix got into this business, it was, well, they're helping VMware environments. It was 100% VMware when they first started that relationship with VMware was really tough. They've lowered that to, you know, they've now got what, 28% is running HV. They've got a little bit on Hyper-V, but they've still got about 60% of their customers are VMware. So VMware, you know, huge challenge. VSan has more customers than anyone in the hyper-converged infrastructure space. Easy, number of customers, but virtualization admins taking that. Microsoft, huge potential threat. Azure Stack's coming this year. It's been coming, it's been coming. It's really close there. All the server guys are lining up. Microsoft's a huge player. Microsoft owns applications. They're pulling applications into their SaaS offerings. They're pulling applications into Azure. When they launch Azure Stack, even if the 1.0, if you looked at it on paper and say Nutanix is better, well, that's a huge, Microsoft's a huge threat to both VMware, which uses a lot of Microsoft apps as well as Nutanix. So those are the two biggest threats. And then of course, there's just the general trend of push to SaaS and push to public cloud where Nutanix is starting to play in the multi-cloud as we talked about and calm. And the DR cloud services are good, but can Nutanix continue to stay ahead of their customers? They're ahead of most of the vast majority of enterprises, but can they convince them to come on board to them rather than some of these big guys? Nutanix is a public company now, they're doing great, but yeah, it's a big tam that they're going after, but that means they're going to have attacks from every side of the market. And I just don't, I mean, I see HCI as one where, you know, you got a leader and that leader can make some good money. I don't see multi-cloud as a winner take all market because I think IBM's going to have its play in multi-cloud, HPE has its play in multi-cloud, Dell EMC is going to have its play in multi-cloud. You got guys coming out of different places like ServiceNow, who's got an IT operations management, you know, practice, business, big, hundreds of millions of dollars of business there coming at multi-cloud. So a lot of different competitors that are going to be going for it, and some of them are very large, with very large service organizations that I think are going to get their fair share. So I would predict Stu that this is going to continue to be multi-cloud is going to be a multi-stove pipe cloud for a long, long time. Now, if Nutanix can come in and solve that control plane problem and demonstrate substantial business value and deliver competitive advantage, that might change the game. It's difficult at this point in 2017 to see that Nutanix over those other guys that I just mentioned has an advantage, clear advantage, maybe from a product standpoint, maybe, but from a resource standpoint, a distribution channel, services organization, ecosystem, all those other things, they seem to me to be counterbalancing. All right, I'll give you last thought. Yeah, so it's great to see Nutanix. They're aiming high, they're expanding into a couple of areas, and they keep listening. So I hope they keep listening to their customers, expand their partnerships. SaaS customers would be really interesting. Service provider is something that they've gotten into a little bit, but plenty more opportunity for them to go there. Dave, personally for me, it's been a company I've watched since the earliest days. It's been a pleasure to watch. I think back right, VMware, you said, I think it was a 100-person company when I first started talking to them in Diane Green, and I look at where VMware went. I've been tracking VMware for now five years, and reminds me a lot of some of those trends for a 20-person company. I said, dear, I said almost 3,000, boggles the mind. I've been to their headquarters a bunch, so it's been fun to watch the Newton Army, and they've been loving watching it from our... Well, and these events are very good events, and so there's a lot of passion here. That's a great fundamental for this company, so I'm a fan. I think it may be undervalued. I think it very well may be undervalued. Wall Street definitely doesn't understand this stuff. So, all right, Stu, great working with you this year, this month, you know, this quarter, this month, certainly this show, so great job. I really appreciate it. There's a big crew behind what Stu and I and John Furrier and Jeff Frick and others do here. Today with us, Ava, Patrick, Alex, Jay, you guys have had an awesome spring. Brendan is somewhere, I guess Brendan's doing the keynote right now, so fantastic job. As always, Kristen Nicole and her team writing up the articles. You know, Jay Johnson back at the controls. Bert with the crowd chats. Everybody really appreciate all your support. Thanks for watching, everybody. We'll see you. We got a little break, I think, in the action, because it's July 4th, well, it's Canada year, Canada week. Canada Day and Independence Day next week. Independence Day in the United States, and then we'll be at InforInforum, second week of July, I'll be there with Rebecca Knight and the crew, so watch for that. Check out siliconangle.com for all the news, wikibon.com for all the research, and thecube.net to find all these videos, youtube.com slash siliconangle. It's everywhere if you can't find it. You're not on Twitter, you're not on social. Thanks for watching, everybody. This is Dave Latte with Stu Miniman. We're out.