 Live from Las Vegas, it's theCUBE, covering Discover 2016 Las Vegas, brought to you by Hewlett Packard Enterprise. Now, here are your hosts, John Furrier and Dave Vellante. Hey, welcome back everyone. We are here live in theCUBE at HPE Discover 2016. This is SiliconANGLE's flagship program. We go out to the events, extracting the signal from the noise. I'm John Furrier, my co-host. Dave Vellante, our next guest. Cube alumni Scott Weller, senior vice president and general manager of support services at HPE, technical services, whatever you want to call it, the big group. Welcome back, good to see you. Thanks for coming. Great to see you, thank you. Thanks for having me. I had a busy schedule. I know you were overseeing all the stuff. And we've had great conversations about the evolution of the programs you guys were putting together for customers around technical services. But I always ask the question every year, is that the same as the outsourcing group and yours? No, no, we're technical services. So I want now that the news is out there that mega-announce that you guys are doing a spin in, whatever the buzzword is, a new kind of transaction where kind of a joint venture, spin in, spin out, whatever you want to call it, with CSE, that's the enterprise services group. You run the other services group. Take a minute to explain what that is about and what it means for customers, the impact to them. Right. So we should first remember that for the next seven, eight months, we're still one company. And so it's very much business as usual in the way we take care of customers and the way we bring them solutions. But then after that, yes, the enterprise services group is actually a spin merge with CSE. And what we believe is that it creates, in fact, unlocks value, both for the current enterprise services business as they become a very large, with CSE a very large player in managed services outsourcing and so on. And the remain co, as we call it, the remaining HPE you have to realize that, in fact, that new business has more than 30,000 services professionals who are involved in everything from advisory to implementation to support services. So I think there's a misconception for some people that in fact, all of the services of Hewlett Packard Enterprise are going to be spun out and merged with CSE and that's simply not the case. And what it does for the new Hewlett Packard Enterprise is creates a lot more focus. So what we've said that we are not going to do except through partnerships with this new company which will be a strategic partner for us but the other SIs in the market is we'll lean on them for traditional outsourcing when that's the solution that makes sense for customers for managed services when that makes sense and also for a lot of on-prem implementation and also the migration to hybrid cloud which is a hybrid IT which is where we think the market is really going. So basically you got, if I heard you two things, one is it's business as usual because HP's got a financial incentive and value incentive in this new spin merge. So it's not like it's going anywhere, right? It's all caught apart of the same kind of family. We couple, but okay, we get that right. And two, that you guys have focus around not just alienating the other partners. It's kind of whatever the customer chooses, the delivery on that, okay great. So that kind of clears that up. Now your group, clarify and continue to amplify what you guys do because you guys are doing a lot of the work on like the technical and the solution side, a little bit different. So give the update on what you're working on. So again, in the new Hewlett Packard Enterprise customers still need advice, guidance. They want to know what our point of view is on this transformation to hybrid infrastructure. I mean the fact is is that all IT shops, in fact we said a few years ago hybrid is a way of life. All IT shops, the customers I talked to, in fact I was just with a few CIOs at lunch. And pretty much everyone is operating in a hybrid model. They may be in different parts of that journey, but everyone is operating at least considering and doing some work if not workload placement across public cloud and on-prem. And so it's helping customers really progress along that journey. We think that is kind of the end state for businesses and helping them understand what are the transition choice points, what are the technology choices, architectural choices, ecosystem choices because it's always involving partnerships in the run model. And so it's the first and foremost the advisory piece of this and it really depends in many ways on the industry. There is very industry specific perspectives on this. And then once you've gotten through that step, then the question is what are the physical steps that get you along the way, whether it's sourcing choices, whether it's procuring, whether it's going into consumption models. And that's again, this is part of what is in this new HPE is all the capability to have those conversations, to do the implementations and ultimately if we have to bring in partners with the pieces that we don't have, we're able to do that. Thanks for talking all day about the operating model is really what people are trying to get to. You just don't change the operating models overnight. They're not disposable. And we talk about the stove pipe models as though it's a pejorative, but in fact, it was done for good reason. We were sort of talking to Sargillai about this from the telco perspective, but the same holds true for the enterprises. You had a purpose built system that was rock solid that did what you wanted it to do, had very high availability and it solved the business problem. Not easy to change that, but I wonder if you could talk from a services perspective how you're helping customers change that operating model. First of all, is that something that they want to do? You buy that premise and how is HPE services, technology services, helping customers transform into that new operating model? Well, I think what I would say is that the stove pipe model was really a result of a rotation to best of breed in the industry. Absolutely. And then that sort of cultivated whole communities that were quite insular. And we've been talking for years about converged and now about composable. And the notion is really just going back to having pools of resources that you can activate and deploy at real time as needed and then put them back into the common pool when they're not needed anymore. So I think that there are probably many journeys that customers will go on. Even the journey from traditional IT to on-prem private cloud is a journey that many customers are still going through. In the end, IT has to be faster. They have to cater to all the constituents, not just the business, not just the CFO, but also the developers who, as you guys know, have a lot more influence now. And if IT can't kind of get IT out of the way for developers to do their job so they can satisfy the business, then IT becomes sidelined. So ultimately, IT has to break the stovepipes to do that because agility is a hard thing to achieve if you're in that older model. And I think that's really the key driver for this. So that's, I think, a great observation that it was about best of breed, which was really driven by sort of Moore's law, right? He or she who could absorb the new technology fastest was going to win because the cost per bit was cheaper. Now what's that metric? Is it speed, clearly agility? And I guess it's labor cost? Is that a fair lens that we should be viewing this, and cutting that labor cost, reducing that labor cost? I think, or effort? Yeah, I think it has to do, it's related to labor cost, but the way I would characterize it is, where, what skills do you need and what skills do you want to have in your IT operation? And less and less, it's around these sort of menial tasks and more and more directed toward the value creation. That's why you see so much emergence in the developer community, right? And so really, what we've got to do is put in a lot of automation, right? And that's why you see the emergence of all of these really cool little companies becoming big companies around automation and orchestration and so on. And this is really, again, part of making IT a lot easier to deal with for the classic IT shop, a lot more available, a lot less difficult for the developers, and ultimately the business says, yeah, that really works for me, versus the feeling and this, and I think there's some, I think that what's happening a little bit is, there's the mythos of the public cloud, which says, okay, on any given day, if I'm really frustrated as a developer, as a business, or as the IT shop, let's just move everything to the public cloud. And what we're saying is actually, it makes total sense to move things to the public cloud, right? What we're seeing though is sometimes these things are done without understanding the full implications, these things are done without really understanding the risks and so on. And ultimately, workloads are moving and then coming back because of a lot of realizations that that wasn't the right place to land that workload. So what we're trying to do in HPE is construct hybrid, make hybrid work for our customers, actually work for our customers, and take a lot of the complexity out of on-prem while making it a lot more agile and deploying pay-per-use models and other things like that. So Scott, you bring up a great point, I want to dig into this, Dave and I haven't talked about this in theCUBE in the past year, and it gets sharper every time we get clear visibility into this trend. And you talked about the stove pipes, which really, we're talking about the infrastructure, I call them stove stacks, like a smokestack. But now you're seeing with cloud and certain, well, convergent infrastructure composable, gives you that kind of standardization. Now with the data layer kind of horizontally scaling across different databases, you're seeing applications become best of breed. Because the workloads now are easily shifted and deployed, where the workloads are now the best of breed. They might have proprietary, they might have domain-specific analytics, but yet need to traverse with the data and then work on a standard infrastructure. Would you agree with that trend? I agree, and I think platforms are becoming best of breed also. And so I think it's safe to say that while there was a lot of really cool IP in the stove pipes, it was an IP that mattered to the business in the end. The business cares about its IP and really continuing to invest in the stove pipe IP is really not good for anybody. So ultimately shifting, and this goes back to the old, how much am I spending on maintenance versus innovation? It's the same story, but it's really about the value creation is happening somewhere else. I ask this question every year, and it's always a fun one for me, because I get a new answer, because you guys are evolving and transforming as a company, because you're in front of the front lines in front of customers. What's the top three trending conversations? If there was a word cloud of the conversations you're having with customers, what would be the big themes this year? Is it IoT, is the cloud the same as last year? What are the hot, important, relevant, cool and relevant conversations that you're in? Or maybe relevant, not so cool, but important. So what would they be the top three or four areas of conversations you're having? So I think in the data center, just a lot of a continued conversation around agility, simplicity, pay per use, catering more to developers, offering the infrastructure as code paradigm, either through services, catered tools, or in the gear itself as we have with Composable. So that would be one. Beyond the data center, there's a lot of conversation around the campus, campus networking, for example, we've taken a lot of our learnings from data center and how to create a really great data center experience. We've now transitioned to do the same thing on a campus network for very large deployments and have won some really large deals as a result. And then I think the third conversation is around IoT and you'll see more and more. You had Sauron, I'm sure he spoke about that. IoT is, you know, IoT, depending on the lens, to some people looks like a big data problem, which it absolutely is. To some people, it looks like how much compute do you want at the edge kind of problem. And for us, we're looking at how do we support customers with a full lifecycle implementation, which means that they're out there measuring telematics or some instrumentation and trying to make some sense of it. How do we support the run of that operation? Scott, thanks so much for coming on and taking the time of your busy schedule to share your insights with us. I'll give you the final word. Share some Meg Whitman's keynotes about the start in about a half hour. What is she going to talk about? Can you give us a little teaser? I'm sure you guys had the big executive meeting and you got some bullet points. What's going to happen out there? Well, I think she's going to maybe answer some of your questions in a different way, which will be good. But ultimately, what this spin merge means to both companies and what both companies will have to offer to customers, again, for the next year we're together, one company, but after that, what does that mean to our customers? I think that's really top of mind for the executive team, is to ensure that our customers feel like we will continue to deliver the value that they've come to expect from us and not miss a beat in this transition. Final, final question. I want to get one more. And what's the vibe internally now that the HPE, E standing for enterprise, splits under your belt. You guys have a swim lane, you got a clear straight narrow execution plan. What's the vibe? What's the vibe internally? Well, I think any time there's big change, people may be a little bit uneasy, but in the next few weeks and months, I think people will get more and more comfortable with it and then it's just a matter of executing for our customers and to complete the separation. Awesome, Scott Weller out in the front lines working with customers as they change their operating model to the cloud data, all the great stuff happening here. This is theCUBE, extracting the signal from the noise. I'm John Furrier, Dave Vellante, you're watching theCUBE. At HPE Discover live in Las Vegas, we'll be right back after this short break.