 Live from the Sands Convention Center in Las Vegas, Nevada, it's The Cube at AWS ReInvent 2014. Brought to you by headline sponsors Amazon and Trend Micro. Okay, welcome back everyone. This is The Cube, our flagship program. We go out to the events and expect a scene from the noise. This is our day to wrap up. Wrapping up the show here. In Las Vegas for Amazon Web Services or AWS ReInvent. ReInvent our second year here with The Cube. And really the breakout year for Amazon Web Services. Really targeting the enterprise. Really continuing their journey of accelerated traction, accelerated momentum. Just adding on more and more use cases. Data points. Services. They are iterating fast. Introducing new stuff. Really extending their lead in the enterprise. People are catching up though. IBM, HP, OpenStack. That lead isn't as big as it used to be. But still, they've got a good size of a lead. We're here for the wrap. I'm here with my co-host, Stu Miniman and Jeff Kelly. Guys, the show wrap up. Big lead, but not so much of a big lead, Stu. People are focused on catching up. People are focused on catching Amazon. John, people are focused, but Amazon has a tremendous lead. First of all, you talk from a revenue standpoint. Latest numbers out there are that if you took all of the other infrastructures and service providers, put them together, Amazon 5x what they're doing. Big takeaway from the show, same as last year, is the flywheel of innovation that Andy Jassy talks to. If they can keep moving and growing and adding new services at the torrid pace that they're doing, they will continue to separate themselves from the pack, John. So, no offense to our good friends at Oracle and IBM and HP, but I don't consider them playing the same game as Amazon does. They are such scale. Talk to James Hamilton, talk about millions of servers that they have out there and build for just tremendous services. Look at what they announced with Aurora. Look at all the other pieces they have. Visionary stuff that they're doing with Lambda. Amazon, this is their market to lose and I don't see anybody catching them anytime soon. Let's do a good analysis, I would agree with you there, but I would also kind of just say it's hard to put the comparison into the buckets of infrastructures of service and sure, 5x, but they're just getting started. Amazon's different. They're a bundled company. Amazon piece is written on entries and horowitz about bundling. Dave Vellante, our partner, wrote a great post on economics. A lot of bundling. Amazon is a retail company. Out of their DNA of retail, it emerged this amazing business model of bundling. And if you look at Amazon, and I want to get your take on this, guys, it's all about the packaging. Retails of the packaging and the platform has to be essentially down to zero, so more platform, better packaging options. So on the web services side, the emphasis of these announcers are very tooling oriented in a sequence of an operating system. Yeah, John, great point here. So many times I listen to enterprise vendors and when they come out with a product, they feel it's a check box. There's some space that they had to go after, something they need to do. When Amazon comes out of it with a new solution, they said, this is customer driven. Doing their own database makes a lot of sense. Having it MySQL compatible means that there's a clear way that they can get into this market, add onto the services. One thing I really like is it's not, oh, infrastructure as a service, platform as a service. Amazon just is building the new layer, that ecosystem, that enterprise application store to give customers what they need and a big partner ecosystem. We talked to a lot of their partners here, you know, management, security, all these other components that are adding on and growing the power that Amazon has in this marketplace. Other observations from the folks out there, besides before we get into the announcements that represent, in my opinion, the biggest stories, is the VC community is here in force and certainly in Silicon Valley, all the top VCs are here, but they're not pimping themselves up. They're not doing the PR thing. They're working. There's a lot of business getting done here. This show, as Mike Dabba just said, looks like the new VM world. This is a place where it's enterprise, it's big, and there's deals getting done. I'm seeing the VCs huddling. These are general partners. This isn't like associates. This is like guys out making the decisions. It's super exciting. And then you've got the big companies here. We talked to Informatica, we're talking to SAP, and they're all here. Startups and the big guys in one cage match. Guys, what's your take on this? Well, yeah, the big guys, having just talked to SAP a little bit earlier today, are very interesting. They have made it clear with some of the acquisitions they've made, and they know they need to move to the cloud, but they also recognize they can't do it on their own, and they're embracing AWS as a way to do that. They don't look at AWS really as competing with them on the database and big data space. I tend to disagree with that a little bit, but it's really interesting you're seeing SAP here and then you see startups that are just coming out of the woodworks in my space in the data warehousing space and analytics and data integration. So there's a lot of action here, and I've mentioned before on theCUBE this week, it's interesting, most of the customers that AWS has put up on the stage, the use cases are data analytics. And I think that's really one of the areas where AWS has a lot of value. There's a lot of data being created. They make it much more easy to consume, analyze, and do predictive things with that data than trying to do that all on premise yourself. Stu, this is to our point we just talked about, which is they're an operating system, so there's a data fabric in there, so it's not a big data show, it's a operating system show for the world. Yeah, John, you know, Andy Jassy said, you know, Amazon's looking to be the new normal. This is what you're building on. You made the analogy of this being like VMworld. It doesn't many ways remind me of that, but there's that undercurrent, of course. Amazon's making a lot of money fast. They're growing their ecosystem, but how fast are they getting too much of a percentage of the wallet, putting too much pressure on their partners, you know, driving down margins across the place, and if they have too much power, there's that backlash. And there definitely are people looking for alternatives. Microsoft's clear number two, Google's moving in that environment, and of course all the other guys are building their clouds. Yes, Stu, break down the competition a little bit. You mentioned HPE, IBM, Oracle, not really playing the same game. What about Microsoft and Google? Yeah, you know, Jeff, first of all, I mean, Microsoft has so many touch points into the enterprise. Most Amazon customers, even if they're all in on Amazon, they're running Office 365. They're using some of the other tools. One of the interviews we did, you know, oh yeah, absolutely, they're using SharePoint, kind of move that over to the cloud. So they're all using Microsoft. They have that utility. I think, you know, the operating system, the new operating system is the cloud. So Microsoft is helping people to get there. Of course, when they do that move, it now makes it a playing field that, well, if I was on the desktop, I've got Microsoft. VMware broke that up a little bit. But now if I go to the cloud with things like Docker and some of the other options out there to be able to make it easier for me to move from one cloud to another, there's going to be, it's going to be tough to get that loyalty. Amazon said is they need to, you know, every hour earn that business. And that's a little bit of hyperbola, because once you're on a solution, it does take a little bit of moving. But, you know, it's a brave new world out there for applications and where they live. We should actually be able to, with Docker, allow the application to be king, which is great for developers. You know, there was a line in the keynote today. You know, we all win with solutions like this that give customers choice and agility. I mean, agility has been one of the key words that we've talked about for the last year at all these shows. So Google has strong technologies too. But there, you can see that they're not going aggressively right now. Obviously, we're at that event. We broke that down really well. It's like, okay, different developers, they got to win some developer traction to earn the credibility, win a space in the ecosystem, and then building on the transport side, really, really critical. But yet, not a business focus at all. So I would call Google still far away from even coming close to competing, but they got the stuff going on. Microsoft, the .NET community, I'm just not bullish on Microsoft. I don't think they're going to have a nice little space there. Just like OpenStack, they're going to have the private cloud. So you start to see the swim lanes. Okay? Amazon and Google really up for the world. Okay? Microsoft for the .NET community, maybe the enterprise, and OpenStack as private cloud. Do you agree or disagree? Hey, John. So Microsoft has to open source .NET, right? So if you were to ask me, you know, a few weeks ago, all right, Google, Amazon, Microsoft, who can leverage Open Source and leverage those communities to move things forward? Boy, you'd be surprised to say that Microsoft might be the most open of them. Satya Nadella has a real, you know, open source ethos here. Google leverages a lot of Open Source, gives some things back. We wouldn't have to do. Yeah, but it's hard to do. But Amazon doesn't give back to the open source community. Yeah. And that's something we've hammered them on. Yeah, but I would disagree with you. Open Source is a playground. And there's an ethos there. There's a protocol. You got to be a certain breed to play in that world. Amazon doesn't try to be open source. They're not head-ficking. They're the playground for the open source guys to execute. So I would, that's what's saying, they're okay there. I think they got to get more in that. If they do, they got to play nice. It's hard to take a .NET developer and turn them into open source. Either they convert over to open source. Yeah, you can't be half-pregnant in that market. Yeah, I got open source .NET. Is that going to drive me more Microsoft-specific business? Yes. And that's not a bad thing. They got a huge install base. Just like OpenStack is not a bad thing for, say, Private Cloud. So we don't know. We'll be watching this. But the question is, Swimlings, do you think they're forming or not? Yeah, John, I think that's a good point. Absolutely. Google is not, you know, head-on attacking where Google is today. Google's not attacking where Amazon is today. Getting their niche in the market. They've got a lot of those pieces. Microsoft is, you know, just starting to approach there. One thing, was there a price drop? I don't remember hearing it in the keynotes, which is something really surprising. We've really categorized those three players as a race to zero. Has Amazon gotten enough position in the marketplace and had enough value that they feel that they don't have to be the lowest cost option? I don't know if that's the case. Reading comments Andy Jassy made around price drops. He was making the point in the media that our value is a lot more than just lower in prices. I wonder if it was a tactical decision not to drop prices, make any announcements around that at this show, in particular, just to kind of highlight that. Amazon doesn't raise prices. What they do is they add more services. That's just the game. They're pushing it down to zero. That's what they want to do. But that's a good strategy to add news and that's what they do. They add more services. One thing we didn't talk about, I would like to get both of your perspectives, is the impact this is having on internal IT departments in the enterprise and how this is impacting jobs, how this is impacting that market. I think it's a big impact and I was commenting on a tweet chat that I was having, a crowd chat with IBM folks yesterday and clearly, shadow IT is being reigned in and what that means in my opinion is that it's becoming standardized. Shadow IT was a tell, a tell for the market where it was going. So it was a telegraph move of saying that's the consumption model. Shadow IT only came about because of the lack of IT being cut in edge. Frustration with IT, yeah. So they just go by the credit card but no one buys millions and millions of dollars on credit cards. So what shadow IT will turn into is the formal consumption pattern. So one, this is certainly shown that. Two, there is a hybrid play here with Amazon. You can put stuff in the cloud and still keep it on premise. I still think they have a really viable shot at hybrid cloud. That's my opinion. Yeah, it is something that we didn't have discussed much at this show is if I go all in on cloud, do I need fewer employees in my IT department? Definitely some customers I talk to, if you were born in the cloud, I can be agile, I can do so many things, I can have developers focused on what I want. If I've got big data centers and I'm shifting over to the cloud, there's going to be a workforce adjustment and some people will get retrained, some people will move into other jobs, so absolutely cloud will have a shift. I hate that term all in with Amazon. That's a misnomer. I'll tell you why. All in means you're all in. Not we're all in with Amazon as we're doing a cloud product. If you're all in with Amazon, you're born in the cloud, you're all your business on Amazon. So you should tell the clients, if you need to word all in on Amazon, it should mean all in. In Informatica, they said they're all in with Amazon. It's like, no, they're all in with their partnership with Amazon. That's different. That means they're committed to the partnership. So John, I'd give Amazon real good grades of talking better to the enterprise this year. They used their language, hybrid IT was there. I want to get your take. What about the developers? You know, I heard definitely microservices and Docker got some good attention. Are they still, you know, beloved by the developer ecosystem? You know, Stu, I think you said it best when you were on theCUBE earlier. You said, you know, when Werner announced Docker, when Ben was on, there was a real round of applause. I think the round of applause was an indication that, yes, this is still a developer conference. Hence, might come out the VCs doing their work here. It's still about education. It's still about all that stuff. So I do think that they're really solid with the developers and that's going to continue for some time. I mean, the services that they're offering developers quite frankly is just awesome. Start up from local host to cloud with GitHub. It's all rocking and rolling. So they're solid on developers. But you know what? Great show. So we're getting ready to wrap up here. Soon they're going to turn the lights out. We stay until they pull the plug. So let's go around and wrap this up, guys. Here at Amazon this year, 2014. Observations. You know, you're talking to a lot of people. Stu, what are you seeing? I mean, I'll start. My observation is that the pattern that's developing is clearly the messaging from Amazon is we're going to win the enterprise too. We're starting now and we're serious. Not we're going to win, but we're serious. And they're showing some proof points. The other pattern is that developers want rapid deployment and the customers are buying cloud. In the hallway, the big trend that's happening that this other vendors should take notice of is Amazon's release cycle is they stay still. They bake it out, they use it themselves and then they get it to a large scale then they release it. The Apollo, Lambda, these are services that are getting great buzz here at the show that aren't going to make the Wall Street Journal or the big trade press. But this is geek tooling that they've proven and used and then released it. Yeah, John, the thing I wanted to point out is really the optimism of the people at this show. Cloud, many people thought it was a big threat. It's going to change what it's going to do to my job. The people that are at this show, John, they're in the sessions. They're not just here getting t-shirts and free beer. They're in the sessions. They're learning about it. They're excited about the announcements. They're digging into all these tools. I mean, I was talking to the CoroS guys and they said, anybody that we scan their badge, they're going to be on our developer list. They're going to get the hardcore coding things that go in here. And that's a lot of this audience and not just the developers, the users, the business people that are finding new ways of having IT enable the business, new value back into the system. And it's exciting. I mean, it's from a technology... What did you learn in the hallway, Stu? Because you did a lot on networking. You were really pounding the pavement. I want to say you did a great job at the show. I was very impressed with your excitement. Certainly, fanboy James Hamilton, as am I, but you were really awesome with him. But you worked. You were working at the parties. You were working out meetings. What did you learn? What did you learn in the hallway? So, John, I love a community like this. A community built around and they really, they're enjoying the tool set. They say there's good communication with what they're doing. It's a passionate user base, which if I'm going to judge any company and any show, that's what you want to see. When we go to shows like Splunt.com... What was the buzz? What was the buzz? Bottom line, me. Bottom, buzz. What was the top buzz? John, I haven't seen I-heart AWS bumper stickers, but they probably give out a lot of them. Bumper sticker on? I love Amazon. All right, Jeff, let's close this puppy up. What did you see? Quickly conversations, buzz, top things? Yeah, I would reiterate what you're saying. I think people are really excited. The vibe here is great. For me, the big takeaway was AWS is allowing, is now allowing enterprises, not just startups, but enterprises, to rapidly iterate and respond to their customers just the way Amazon does. And that's really a mark of taking on these enterprise challenges, helping enterprises do more with their data, work for less about the infrastructure, and really apply that, who work, focus on the customer, just like Amazon itself does. Well, I'm psyched to wrap this show up with you guys. Great job, great shout out to the crew. Matthew, Greg, Patrick, all the guys back at the ranch. Dave Vellante tweeting away. As I end here, I'm looking at a tweet from Jeremy Burton, and it says, EMC family of companies on stage at Techonomy event, which is run another event by another publication, Fortune Mac, I don't know, was Fortune. It's Gelsinger, Goulden, and Moritz. So, Stu, they're not going to go down without a fight. EMC is not going to go down without a fight. Yeah, John, I didn't hear only a couple of conversations about what's going on with Cloud Foundry at a show like this. Absolutely, the Federation is aware of what's going on at Amazon, and they're pivoting to try to, you know, address the Cloud. They've got plenty of Cloud solutions, but if I was working for, you know, one of the traditional enterprise guys, Cloud is real, Cloud is here, and it's coming after for you fast. It's super exciting. My final takeaway observation is that Amazon, on all the customers we talk to, it's an engine of moving the ball down the field. People are seeing scale. They're seeing progress. This is the point where the running game, one yard of moving the ball, going to move down quickly, big passing play here if you're using analogy and football, and I just think it's awesome, and certainly exciting, Stu, I echo your comments, great community, and for the Cube and the Cube team, this is going to be a great sporting event in the tech-athlete world that we cover. Everyone's involved, it's super exciting, and we're so glad to bring that to you, and that would not be possible without Amazon and Trend Micro. Without their support, the Cube would not be possible and allow us to bring our passion and our hardcore data analysis to you. That's a wrap here at Amazon Web Services 2014. This is the Cube. Keep watching and see us at their next event, silkenangle.tv, for all the details and videos. Thank you for watching.