 Live from Washington D.C., it's theCUBE, covering Dotnext Conference, brought to you by Nutanix. Welcome back to Dotnext in D.C., everybody. My name is Dave Vellante, and I'm with my co-host, Stuart Miniman. This is theCUBE, the leader in live tech coverage. We go out to the events and extract the signal from the noise. We're here at Dotnext Nutanix's customer event, two days of wall-to-wall coverage. Julia Palmer is here. She's a research director at Gartner, my new best friend. Great to see you again. We had a great dinner last night. I really enjoyed the conversation. Thanks for coming on theCUBE. Oh, my pleasure. So, it's a good little event here. A lot of excitement, but what's your take? You're a former practitioner, now an analyst. You were in the heart of technology at GoDaddy. You really know the market, the products. What do you make of what's going on here at Dotnext? You know, when Hyperconverged's first emerged, it was all about saving money. It was all about going from infrastructure that was maybe too complex and too expensive to something that maybe based on commodity will bring lower acquisition costs. But this is not a story today at all. That's what I think my IT leaders are telling me. They're not going after acquisition costs. They're not looking at things just comparing by the capex. They're looking at a bigger picture and how will this technology will help them to enable business? So that's, I think, the biggest difference now. Going from something as simple as is it going to be more expensive, less expensive too? How will it move the needle to my enterprise, to my organization? So that's certainly the messaging that you're hearing from Nutanix. As a practitioner, do you buy that? Do you believe that they're more than just an infrastructure company, that they are a transformative force in the industry? Yeah, I hear a lot. You know, I moderated the panel today with three customers and one of them said, you know, I'm in the healthcare business. I'm here to save lives. I'm not here to reinvent my own Hyperconverged infrastructure. So he wants to focus on what's important for his end users. And he wants to stop, manage componentry. That's just not a focus. And I hear it over and over again from different types of customers. Now you were not a Nutanix customer previously, correct? But you did see a lot of different infrastructure products. As a practitioner, what bothered you about what the vendor community did? What were your likes and dislikes? Everything, everything bothered me. I was part of a pretty large organization. When you have a big footprint, you have big problems. And one of them, for example, was that we would have an outage and we would reach out to the vendor and they would tell us, you know, you hit a bug and we have a fix and we will give you the fix and you will be good to go tomorrow. Never mind the outage that you had and impacted end users. So now a lot of vendors using predictive analytics, cloud-based analytics to see if there's anything in your existing environment that's susceptible to existing bugs and proactively reach out to you to provide a fix. So I was just thinking, looking back, how many outages I could have prevented if this technology was available when I was running it? Yeah, Julia, I mean, we know that companies for so long, you know, infrastructure, they spent so much of their time, you know, running around, patching it, fixing it, worrying about that. Hyperconverge now is trying to talk about, you know, where it fits into the whole cloud picture, which is mostly about an operational model. Where do you see along those trends? Do you believe that Hyperconverge really fits into a cloud strategy or is it cloud washing from a bunch of infrastructure people? Yeah. I think it has a potential. I don't think it's there today, but I think it has a great potential because when I talk to Gartner end users about like why Hyperconverged, and I actually did some total cost of ownership research, what they all told me that looking back, they realized how much optics it saved them. And they said, it was very difficult. We kind of had to take our chance on it because upfront, you can't predict the outcome. Is it really going to be more simple? What does it simple mean? What's key performance indicator and simple you can put? So, but looking back, the guys that implemented, they all told me that 60% of optics they saved, meaning they dealing less with infrastructure componentry. How do they do this? They stop manage components, they start manage VMs. So next step is stop manage VMs, start managing applications. And that's what cloud management is all about. Getting out of infrastructure management altogether and deliver business what they want. And usually they want support for their applications. So my understanding is that Gardner has analysts that service the vendor community, the executive community, and the practitioner community. You are a direct practitioner. Yes, people with IT leaders. Okay, you're peeps. I think you mentioned to me last night that you've had hundreds of conversations and you've only been at Gardner, what, six months? Two years. Oh, two years, sorry, apologize for that. Okay, so in the two years, hundreds of conversations. Is that fair? What kinds of conversations are you having with clients around infrastructure? What are the challenges that they're having? And what are you advising them? I know there are many, many, but maybe you could summarize the top ones. That's a very good question. I actually wanted to write research about it. Top five questions about hyperconverse people asking. So I've been thinking about it for a while. So different types of customers, new customers are asking questions about, is it ready? Should I go for it? Why would I go for it? Why can't I keep my street tier infrastructure design? What should I look for as a new key performance indicator? So it's not the same way how would you judge street tier? Then existing hyperconverse customers are looking for what's next step in hyperconversion. Is it ready for prime time? Is it ready for mission critical applications? Because they're looking at the boxes and they look at the commodity hardware and they still feel uncertain. Can it really run something that they're a proprietary hardware used to run? So we explore the advantages of software defined storage. While using the software, being backed up by software defined storage, my favorite subject, is obstructing and distributing data that you don't worry about this anymore. So scale out storage replacing proprietary architecture can provide you same level of uptime and performance, especially with new flash options. So that's a popular question. Number three is just, you know, we leave it in the age of compressed differentiation, I believe my colleague Dave Russell calls it. And there's a small differences between vendors and end users are not aware of this. They can be critical for particular use case. So they always ask strengths, weaknesses, opportunities, threats on each and every one of them. Because we have a lot of solutions on hyperconverse now. A lot of vendors, prominent vendors now join the market. So end users are a little bit confused. How do I navigate through this ocean of different hyperconverse solutions? Yeah, so Julia, Nutanix helped really drive a lot of this awareness for the hyperconverse market. Now, every company, you know, all the big players have at least one, if not multiple solutions out there. How do you see Nutanix? Are they differentiating themselves? Are they, I know they're trying to move beyond kind of the hyperconverge label. You know, what are they doing good? What would you like to see them do more? Yeah, Nutanix is, you know, was one of the leaders from the very beginning and you know, remains the leader. They obviously succeeded in releasing a lot of features and very fast release cycle of new features. It's easy when you have one focus. You know, other companies have so many different areas they need to focus or protect and Nutanix doesn't have this problem. And also being able to mix different hardware, I think it's an advantage. You know, being able, the customer needs to make a choice. You know, I think infrastructure of the future is going to be all about choice. It's less about, you know, this is a lock-in. I want to pick my hypervisor, I want to pick my hardware and move on. One of the things, I think Nutanix does best when they're not positioning themselves as a storage solution because the storage market is tremendously competitive and there's always, you know, there's the next technology, the next wave, there's so many competitors out there. I mean, do you think things like NVMe over Fabric are going to just, you know, have the potential to disrupt everything that Nutanix is doing? You know, what are some of the big threats to, you know, their current position? Well, actually, I just wrote a research about how NVMe and NVMe over Fabric is going to disrupt and improve integrated and hyperconverse systems. I think those technologies, and it's like NVMe without NVMe over Fabric, it's like, I call it, it's like barbecue without barbecue sauce, right? So the NVMe and NVMe over Fabric has potential to boost performance of hyperconverse systems on par with what solid state arrays today do. So I think, and it's commodity hardware, right? We're not talking about anything proprietary. So when we're going to move towards this territory when NVMe and NVMe over Fabric become mainstream, maybe two years from now, three maybe years from now, I think everybody can enjoy shared distributed storage performance. And, but honestly, your question about storage, like, do you need to position yourself as a storage company or not? The major difference about different hyperconverse products, in my opinion, is how they do storage. Other than this, it's the same flavors of hypervisor, it's the same commodity hardware. So what do we have different? The ways you did data services, the ways you position your storage, you deliver the storage services. I'm curious, when I read Wall Street stuff about Nutanix, they seem to overreact to every bit of news. So, you know, the Dell relationship, you know, is challenging there for that to headwind. Oh wait, the Google announcement seems to be a great tailwind, you know, the big bump in the stock today. Do you see those partnerships as critically important or is it the vision and execution of Nutanix and what they're doing with their customers? I think so. I think we live in the age when ecosystem support is everything, you know? People not necessarily today go to the public cloud to save money. They go for ecosystem support to expand their services and their capabilities. That's why, you know, embracing the cloud and not trying to position yourself against is the right way to go. I think we all need to embrace cloud and find a way that will benefit the end users. So, you were sharing with, you spend a fair amount of time, all Gartner analysts who do these things do on magic quadrants. They, you put a lot of effort into it. A lot of people criticize magic quadrants. I think they're unfairly criticized. I know how much work goes into it. Thank you. And they're fact-based opinion if I could categorize them like that, right? Is that fair? So, do you do one on hyper-converged infrastructure or converged? Do you separate converge from hyper-converged? How do you look at the market? So, last year magic quadrant was integrated systems which is converged and hyper-converged. But what Gartner does is actually every year we look at the market and we adjust our inclusion criteria. We adjust market definition. So, I don't think it's a big secret that hyper-conversion is leading this market right now. And honestly, in converged infrastructure, if you look at converged infrastructure, it's very similar. The only difference in converged infrastructure is how you do storage, which storage array you're using. So, it becomes less strategic to even analyze converged infrastructure. So, you will see this year, I cannot break all of the news here, but much more emphasis on software-driven, hyper-converged infrastructure, not services, not the appliances, but more software ads. I'd love to hear that, because at Wikibon, we call the category server sand. So, like VMware, major player, both as a partner in Nutanix, competitor in Nutanix, you know, I know what they're like, they don't show up on the Gartner Magic Quadrant because they don't fit into that environment. Also, the lines between converged, hyper-converged and software-defined storage seem to be blurring a lot. I mean, in some ways, they're just different ways of packaging. Some of the others, hyper-converged is a delivery option for what they're doing. So, where do you see it going? It's obviously beyond the appliance, but say there's the Google announcement today, where do you see a company like Nutanix fitting into this hybrid or multi-cloud world? Differentiating on software, this is the name of the game, right? So, if you can have a portable software, you can run on any hardware, you obviously can continue and run on any cloud as well. And this is an idea. You said it absolutely right, like software-defined storage, it's not a technology, it's a delivery option. So, customer needs to be in charge of their options. Do I want to deploy it on premises? Do I want to go on cloud? Do I want to have an appliance? Do I want to buy software, bring your own hardware? All of those choices need to be given to the end user. They need to decide which way they want to go. So, we're going to have Chad Sackich on tomorrow, and it's obviously interesting. We see Nutanix selling through Dell. We were there two years ago when that announcement was made. Great business, terrific. But as you were saying, converged and hyper-converged and software-defined, they're all coming together now. What do you expect is going to happen with EMC and Nutanix? Do you have any, I don't want to use the word prediction, but any scenarios that you can see developing there? I think, you know, I hate to speculate, but I think both of those companies are extremely user-oriented. So, if there will be demand for Nutanix, Dell will continue to support Nutanix because they will do it right by the customers. And same with Nutanix. You know, they never want to turn someone down and saying it's not our problem. They will both support them in parallel as long as demand is there. So, let me ask a question differently, because I agree with you. EMC, customer-centric. Michael Dell, nobody more customer-centric on the planet, clearly Nutanix customer-focused. Having said that, if the three of us were advising Dell EMC on what to do, we would say keep doing what the customers want. Great, check. But from a product roadmap standpoint, I don't know about you, Stu, but I know I would push them to look at doing more of a hyper-converged software to find like roadmap, as opposed to kind of bolted on V-blocks, which got it all started. Would you agree with that, or do you think that's a waste of R&D? Just outsource it, or OEM it? So far, defined storage is hard to do. It's hard to do it from the ground up, you know? Products need to mature, you know, VMware, V-Send. It's a mature product. It's a good foundation for software-defined storage and for hyper-converged. Building something from the ground up, just to be separated from VMware, it will be very difficult. Okay, well, okay, right. Well, then double down on VMware, maybe, is the advice there. Or maybe they're not really acquisitive right now because they have the debt service, but over time, maybe bring in startups to innovate there, or maybe not because when you look at the Dell EMC deal from previous generations, it was a very successful deal. One of the most, probably the most successful storage deal in the history of storage, the partnership. Before Dell bought Compellent, then remember, Dell buys Compellent, I would look back on that and say, Dell probably would have been better off just staying with the EMC, reselling EMC. I mean, you were there during those days, I don't know. It was Compellent and Equalogic. Were those successful acquisitions in your view? In retrospect? In retrospect, they did pretty well, but you're right, Dave, the EMC partnership was way more money. I think by the time Dell bought EMC, the internal Dell storage revenue had grown to almost, or order of magnitude, the same size of EMC, and they had to put a lot more emphasis into it. So better margins, if they could see your partner. Maybe it's better for Dell to continue to partner, it's kind of your point. Absolutely. Okay. Very diplomatic. Would you expect anything else? Julia, thanks so much for coming on theCUBE. It's a pleasure having you. Oh, thank you guys, it was my pleasure. Thank you for having me. You're welcome. All right, keep it right there, buddy. We'll be back to wrap right after this short break. This is theCUBE, we're live from DC at Nutanix.next. Right back.