 Live from San Francisco, celebrating 10 years of high-tech coverage, it's theCUBE. Covering VMworld 2019. Brought to you by VMware and its ecosystem partners. Welcome to day two of theCUBE's coverage of VMworld 2019. Double brows, two sets going on. On our other set, Dave Vellante and John Furrier, they're talking to Michael Dell, they're talking to Pat Galsinger, but over here we know where the hot action is talking about. Even Steve Young, you know, the Hall of Fame quarterback from the 49ers knows what hyper-converged infrastructure is and therefore I'm excited to welcome back to the program Chad Dunn, who is the vice president of product management and hyper-converged infrastructure for Dell EMC. Chad, great to see you. Great to be back Stu. And also, I want to also welcome my guest host for this segment, who is Bobby Allen, coming to us from Charlotte, North Carolina. Hey, Cube alum, now flipping the desk and going to be asking some questions with me. So, Chad. Well, my first question is, why did you put me up against Michael and Pat? Well, because we knew you could take it. Some people would be like, oh, that's the other Chad even, but HCI, still a big story. It's a big piece of what goes into VMware's VCF story there. VMware's talking about there's 20,000 deployments that they have of VSAN and I believe you might know who the number one partner is and the number one solution set out of those 20,000s. I think I might and I think that's also the leading product in terms of volume and the leading product in terms of revenue in the hyper-converged market as of last quarter. So, we'll give you a second. Give us some of the drum beat, the chest thumping of how the VxRel product line and your portfolio is doing. The portfolio is doing great and the integration of VCF on VxRail is just throwing gasoline onto the fire in terms of adoption. We see hyper-converged now mainstream moving into the data center. Mission critical applications are being run on it. Infrastructure is a service. Right alongside container is a service. So, a few things that we announced this week in addition to the latest update of VCF on Rail, we added Fiber Channel to VxRail. A move that people are very, it's a very polarizing move for people. Why? We have people who continue to love their primary storage arrays that are Fiber Channel connected and very often we're selling to someone who's refreshing servers, but they have life left on the array. They want to preserve it, they want to migrate data. So, they demanded Fiber Channel, we gave them Fiber Channel. Right, so if I understand this though, I've seen certain HCI's where there's like a faucet on the side that I can plug in. I scuzzy, now you're just saying there's that. It's not like you have a VxRail that is Fiber Channel baked in through and through because it's a server architecture. There's still VSAN at the core of VxRail, but we give you the option of now attaching primary storage either in the context of VCF or in standalone. Other big news is we've recently refreshed the product line to the next generation of Xeon processor, the Cascade Lake version, that gives us about a 28 to 30% performance increase and Intel Optane cache drives. So, lots of hardware updates along with software updates that accelerate our LCM, our life cycle management process. So Chad, thank you for the update, but I've got a different question. I want to go in a different direction. I talk to customers all the time, CXOs. What would you tell the CXO who's scared to invest more in the data center? Because public cloud seems like the wind is in its sails, but obviously Dell has a story to tell. How do you help them defend their turf? Well, I don't think they should get territorial about that. Every customer that I engage with has a hybrid cloud strategy and very often it's more than one public cloud. There's always a champion-challenger relationship. We, as CXO, you want to keep your vendors honest. Correct. So you may have multiple public clouds, you may have multiple infrastructure providers, but VMware and VCF on VxRail can be that common thread between the two. So I can use tools like VMware Cloud Health to determine where it makes sense to run the workload. And I can very seamlessly move that workload from a VCF on VxRail deployment into a public cloud when it makes sense. I can bring it back when it makes sense. I can move it to Amazon, to Azure, to Google, to any one of the VMware cloud providers and really hedge my bets in terms of where it's best to run that workload. So we encourage public cloud. Are you seeing customers actually take advantage of those capabilities yet, or is it something they're still kind of waiting to see how that develops in terms of hybrid and multi-cloud? We see customers taking advantage of it right away. So I'll give you an example. I have a large retail customer right now and they've got about 900 different workloads that are existing virtual machines. So they're looking at how they either refactor those into cloud native and move them into the cloud or whether they rationalize some of those away, which is sort of a natural process. With the Dell Technologies Cloud Platform, which is based on VCF on VxRail, they can effectively put off that decision and they can move those workloads into the public cloud as virtual machines and start to enjoy those economics while they decide which ones to refactor, while they decide which ones to rationalize away. Yeah, so Chad at Dell Tech World, we talked a bunch about how VxRail is the underpinning for the VMware Cloud on Dell EMC. Here at the show, we'd talk a lot about cloud and even Kubernetes was mentioned just a few times yesterday in the keynote. There was some guy in the audience, Houten Hollerina about some of that. But help us draw the line. Where are your customers today? What are they starting to do and where does this portfolio extend to in the future? Great, well first of all, I'm going to do a session tomorrow morning at 9.30 and we're going to be talking about the business aspect of Container as a Service and Kubernetes to customers. So a good session to check out if the viewers can. But from our perspective, we see customers at different points in that journey toward Container as a Service or cloud native on their premises or in a hybrid cloud scenario. And it's funny, one of the slides that I'll do tomorrow says that about 71% of customers are spending their budgets on operating their infrastructure as a service or their traditional VMs when they want to be able to reinvest some of that money and move to cloud native. Now this is almost the exact same slide and same percentage that we used, five, six, eight years ago to talk about keeping the lights on with 70% of IT budgets. It was the 80-20 back then I think, but yeah. So it's the exact same dynamic. We're seeing it really be mainstream now. Every DTW or EMC world that I would go to, I would always ask how much of your workload is cloud native? They would always say 1%. How much is it going to be in five years? They'd say we have no idea. Now they're telling us about what those projects are and they're rapidly adopting them. But the nice thing about the VCF on Rail is you can create workload domains that are traditional infrastructure as a service with virtual machines, but you can also spin up a container as a service workload domain with PKS and NSXT. And so as you start to refactor those applications and as that balance changes, you simply increase the number and the size of your cloud native workload domains and you shrink your infrastructure as a service. So you're in an ideal spot to be able to run virtual infrastructure workload domains, virtual desktop workload domains, cloud native workload domains, consistent operating model across the board, consistent hardware layer which is VX Rail. So you get those economics and as your business demands change, you as an IT operator are able to serve those DevOps organizations within your company. Because if you're not providing them a Kubernetes dial tone, they're going to find it, right? And you're going to see shadow IT spring up and they're going to be in the public cloud before you know what happens. So Chad, one of the things that I'm curious about, so this is a software conference obviously, right? We're talking about a lot of the goodness that's hypervisor and above. What would you say to the person who says doesn't matter what sort of hardware I'm running? Is that a commodity? What is Dell's differentiated value in this software defined world? If I wanted to be a smart alec, I would tell you to look at some of the other hyperconverged competitors who went software only and then go take a look at their market cap. But if I wanted to be serious, I would say that hardware really does matter. And when you look at how we need to lifecycle manage that infrastructure and make it seamless and effortless for the customer, it means that you need to think about that hardware layer. So if I look inside a PowerEdge server, for example, there are between nine and 12 different programmable parts from BIOS to HBAs to drive firmware, backplane power supply, you name it. All those things have dependencies on the software drivers that you use. Being able to look at that all in context and be able to update that all at once so users don't have to worry about the bits and bytes of drivers and firmware compatibility really saves them money, saves them time and effort and lets them concentrate on things that are going to differentiate their business. And we see customers making that switch daily now and understanding that they can now redeploy some of that cost and resources toward things that are more differentiated like moving to cloud native. So Chad, what about the folks that have a, they've got a Dell footprint, they've got some other competitors in that. How do you help them where they're maybe in the midst of changing over, right? They've got some other manufacturers that provided hardware before. Some of that story may not be as consistent. So what can they do when they may be in the midst of a changeover? So you really need to look at what that operating expense savings is going to be. So we certainly want to get as much life out of that existing infrastructure as we can and then provide migration. Fiber channel and IP attached storage is an example of that, right? Where people are not necessarily ready to move away from those arrays. So it's a great, right? Continue to leverage those assets. But also if it's an existing vSAN infrastructure based on bare metal servers, migration from one vSAN environment to another is a pretty seamless one, right? Because you preserve that storage policy-based management as you make the migration. So it typically is a pretty easy migration for customers to move on to hyperconverge. A lot easier than they think. And obviously we'll provide whatever professional services are necessary. If you look at, by the way, and I'll plug VMware since I'm at VMworld, if you look at VMware HCX for doing migration across these environments, either to or from a public cloud or from a legacy environment to a next generation HCI environment, that's one of the coolest tools out there for doing that migration and preserving all the policies, security, and software-defined networking policies and micro-segmentation from one environment to the other. So really impressed with what VMware has done there. Yeah, Chad, definitely a theme we've heard at this show is VMware talks to their install base and says, oh my gosh, you look at all of these cloud-native things out there and Kubernetes is super hard, so we're going to build it and enable it in there. When I've looked at the Dell and VMware family, there's been a few different Kubernetes options out there. Help gives a little clarity as to where that fits into your world and where we are today, where it's going kind of in the near future. Yeah, there has been sort of a dichotomy of cloud-native inside VMware and cloud-native inside Pivotal, for example. And we've worked with both of those organizations. In fact, we've been very successful with both platform and containers of service on VxRail going to market with Pivotal. But now that PKS is moving into VMware and really all of Pivotal is moving into VMware, it sort of unifies that strategy. And if you look at the acquisitions that VMware is making with Heptio and others and actually embedding Kubernetes into ESXi, I mean, that's a game changer, an absolute game changer. So now we have all of the software assets to build, run, and manage cloud-native workloads all within the VMware portfolio. Now the great thing about VxRail is we inherit all that work natively and build that natively into our hyper-converged platform. So we sort of get that for free. So not only can we now be the leading hyper-converged infrastructure player for infrastructure as a service or traditional VMs, we now can expand that and be the number one player in the new container world. And as you saw with the performance discussion that Pat had yesterday, they actually see these things running faster in a virtual ICS-XI environment than we do on bare metal, only single digits. But that's pretty impressive, right? It's very counter-intuitive. So we're really happy to be able to take advantage of that. And we still have the Pivotal Labs team which really gets engaged with these customers to make it more transformational in terms of how they develop and how they deliver applications to their end users. And by the way, I mean, not to preview something that's pretty far down the road, we're looking at how we change up how we deliver software updates in VxRail and how we architect the software to make it a continuous integration, continuous delivery pipeline. Because we need to make the infrastructure more intelligent and more agile and products like VxRail Ace, which we just announced at DTW, does exactly that, right? It gives us the ability to pull back telemetry from VxRail, apply machine learning and artificial intelligence to it in our own cloud, and then push that data back out to our VxRail users to auto-remediate problems. So the infrastructure's going to get more agile and it's going to get more intelligent as we go. Yeah, we've been talking a bit about some of the future stuff before we go, but I want to bring back to one of the core things that we wanted to do in this space. It was simplification. How do we make it super easy when I talk to most people that do HCI? It's like, you know, where is that? It's like, I don't know, it got installed and I've never touched it since then. My understanding, you're doing some things even on the management side to make things even easier. Is there some virtual reality in there too? No, we like to think everything is real reality. But yeah, we are doing things to even further simplify our lifecycle management process to make that infrastructure something that operators don't need to worry about. So we're now doing pre-staging of updates, future scheduling of updates, pause and resume of updates to fit within customers maintenance windows more effectively. We'll be doing updates that are delivered via the cloud through the ACE platform coming up in a release that's about the ship. So again, the idea is to simultaneously make the product more flexible but maintain the simplicity. Because as I said, we've moved into these core data center deployments where people are buying 600, 800,000 units at a time and deploying at scale. And they expect flexibility. All the flexibility you would get with an ESXi server with all the simplification and day two operations that you get from HCI. So we're in a constant state of trying to balance those two things and optimize for both use cases. And by the way, at the same time, software defined networking containers are coming at us at light speed. VMware has acquired more companies in the last three months than I can name. I can't name them all. So it's a very fast moving space. Yeah, I don't think I can keep up with the last week. Yeah, right, right. All right, Bobby, final question. I guess quick sound bite. What should people know about VMware Cloud on Dell that they don't know? On VMware Cloud on Dell EMC, you're going to formally project dimension, the extension of VMC on the customer premises. I think this is incredibly strategic for us and for VMware because it gives you that cloud consumption model on premises in an operating expense model. So just to initial access with that, beta customers are turned up and the feedback has been extremely positive. VMware Dell Technologies Cloud Platform, which is VCF on VxRail, really off to the races on that, right? We've had huge uptake in that. We're seeing deals of literally hundreds of nodes at a time. Data centers at a time are consuming this, deploying it. We're demoing it here at the show. If you go to the NVIDIA booth, all the VDI demos are being run on VCF on VxRail that's sitting over in a hotel across the street. It's a very hot hotel room because we've got a lot of GPUs in those. But it's also something that users can actually go see it live and working. Nice, thank you. All right, and just a quick tip for you. If you haven't made it to VMworld or even if you came here, Chad mentioned he's doing a session this week. They do make all of those available to people out there and of course all of our content is always available on thecube.net. Chad Dunn, always great to catch up with you. Bobby Allen, thanks so much for joining me for this segment. And to my audience as always, thanks for watching theCUBE.