 Hey, we're back live at EMC World 2012. I'm John Furrier, the founder of siliconangle.com and siliconangle.tv. I'm joined by my co-host. I'm Dave Vellante of wikibon.org and John, this is the spotlight on the future of backup and recovery. It's sponsored by the EMC backup and recovery systems division. And we actually, watching Steve Manley up on the big screen, he's doing the live keynote. He's coming over here right after this. But John, we're going to set up the whole backup and recovery market with a specific discussion on purpose-built backup appliances. We had B.J. Jenkins on earlier. Good segment, right, B.J.? Do you want a good job? Yeah, I mean, Dave, backup and recovery is one of those things we just heard from the secret CTO just joined a year, gave us some commentary. EMC has maintained their leadership, mainly because of their portfolio of products. One of them and that portfolio is backup and recovery, which is not going away anytime soon. So I think the market angle here, Dave, is to really drill down and saying, okay, what's really going on in backup and recovery? Here are the facts. Big data is emerging on the scene, clouds emerging on the scene, new infrastructure at the IT level, and new data, driving business process and improvement, analytics, et cetera. It's putting pressure on the infrastructure, mainly around real-time information. Real-time, as David Floyd from We Can Find will talk about, is about low latency. So that's going to change the game at the edge, in terms of flash and architecture, but also is going to require different backup challenges. So BJ Jenkins, I thought was pretty interesting when he talked about the set of challenges around backup and recovery, from compliance to tech, et cetera. Yeah, he's up on the keynote right now, and Mark Hopkins has set of slides that we prepared, and we're going to do the first one, we're going to look at the market angle. And so you could see here, there's this new category of devices called purpose-built backup appliances. And John, you know, it was that the tape was the way you did backup, and then all of a sudden, the industry started doing disk-based backup. And my assumption was always that the market size for those disk-based appliances could be no bigger than tape, but it's actually bigger than that now. IDC says the market was $2.4 billion last year, growing at 43%. The tape has been declined, and it's probably around a couple of billion, you know, maybe two to three. I like the acronym PBBA. Yeah, Purpose-Build Backup Appliances. Backup Appliances. I was thinking PB... Peanut Butter and... PB&J. Something else. Yeah, but it's an interesting acronym, but think about this, Purpose-Build. Appliance has been the rage lately. Why is that? Why is this not? And BJ talked about the solutions out there and how competitors are saying, oh, our software's cheaper. There is a total cost of ownership angle here around this. Why is the Purpose-Build Appliance thing really working? Backup is a very specific, you know, operation. You think about it. It's a batch job. It's very CPU-intensive. You got to have, you know, fast backup and fast recovery. So it's a very specific, narrow type of application. And so having an appliance made a lot of sense. And as you can see, the market's enormous. This is all this pent-up demand. And a big part of the reason I think here, John, is that nobody wanted to invest anything more in tape because tape is just a horrible medium. It's great for certain things like we were at NAB and we heard that, you know, in certain broadcast industries, where you're doing a lot of editing, a lot of revisions, having tape as an archive and a deep archive makes sense, but for backup, it's going away. And the other thing you're seeing is this pent-up demand from virtual machine sprawl. VMware and other virtualization technologies came up, came out, and it really stressed the backup window. The time in which you had to actually protect your data, let's say overnight, keep shrinking. And so disk has become the dominant backup platform and data de-duplication, the ability to reduce and optimize the amount of data that lives on that disk has become a fundamental game changer in terms of optimizing the cost associated with that. So, John, we just did a survey at Wikibon and you can see this here in the next slide. We asked people, what's your single biggest challenge in 2012 for IT? Hold on, this is the bar chart slide, hold on, make sure we got that. Yeah, the bar chart slide. So we asked people, what's your single biggest challenge, IT challenge in 2012? And this, the survey was self, you know, ranking. Four or five things came up that really struck me. One was budget constraints, no surprise there. First and second, virtual statistical dead heat, data growth was the second. And then, you know, a distant third and fourth, but still higher than the rest, data protection and the inability of IT to respond to the business. So you asked before what PBBA's purpose-built backup appliances are all about. It's all about these four things, the trying to really focus on budget constraints, bring de-duplication into the fold so that you're doing disk-based backup with economics that are closer to tape, close enough to deal with number four here, which is agility and responses to business. I don't think the slides are on the screen. Yeah, so- Bar chart, do we have the bar chart mark? Keep going on. Yeah, so then data growth is the other one and that's the other thing that is really stressing backup windows is the massive amount of data that we're seeing here. And it's really, it's all about data protection. And then we heard from BJ Jenkins this morning about security. So when you look at this market, so this is a double y-axis graph that we have here. You can see the left hand side terabyte ship- So the title's PBA market up into the right. Yeah, it's growing like crazy. So it's a double y-axis. The right hand side is dollars. The left hand side is terabytes. You can see the bars are terabytes. They're growing like crazy. The revenue's growing like crazy. So the revenue's grown from 1.6 billion in 2010 up to almost six billion by 2016, according to IDC's forecast. IDC just released a critical report on this marketplace and you can just see it's growing like crazy, growing much, much larger than the entire tape market is for backup. So it's quite amazing. But this is the most amazing statistic. This next slide, this pie chart. EMC has the dominant share in the PBA market according to IDC, 66%. So EMC, as you know, John, had Avamar. It had a network that it bought, purchased from Legato years ago. It bought data domain for $2.5 billion as what we at the time called a defensive play to keep NetApp from getting it. But it's become actually a very aggressive, offensive move, allowing EMC to get 66% of the market. And that's quite astounding. They've had that market share since the data domain acquisition. They've held it. You see IBM's got 15%, HP's 4%. IBM and HP both have said they're coming after EMC. They're going to try to get a bigger piece of that pie. We heard BJ Jenkins today say that he felt as though that was sustainable. They're going to extend their product lines. They've got some new models of data protection that we're going to talk to Steve Manley about. And the final piece that we have here, John, is really sort of four key areas that we want the customers to look at. One is data growth in your shrinking RPO and RTO, the recovery point objective and the recovery time objective. Recovery point objective being how much data you can lose. Recovery time objective, how long it takes for you to get data back. Those shrinking RTO and RPO windows are stressing backup windows. So if that's the case, it might be time to rethink your backup processes. And so can organizations leverage these existing processes or do they have to rip and replace? That's really the fundamental issue. And a lot of customers that we talk to are choosing the latter, rip and replace, even though nobody wants to do that, John, because it's expensive and disruptive. But because of virtualization and the benefits of virtualization, they're forced to re-architect their backup. The third question is what's next in backup and recovery? How is backup and recovery evolving? We've heard today a couple of times this notion of the time machine, Apple time machine for the enterprise, being able to dial down and dial up, how much data you're willing to lose, take snapshots throughout the day. And finally, as IT transforms to become a service, how will backup change? Will we see data protection as a service emerge as opposed to what we've seen for years one size fits all? So John, those are some of the issues we're looking at at Wikibon and SiliconANGLE. We've got a number of segments here. We've got Stephen Manley coming up. We've got a panel of experts. We've got some customers that we're going to talk to about this issue. And so give me your final word and then... I think this is a category that's obviously solution specific. It's not as clean, rip and replace. It's complex. As you mentioned, this cost involved. So I think one of my observation here, Dave, is that with the evolution of tape, taking more of a real, real backseat role and spinning disk becoming the key backup platform and flash becoming the primary storage for these new application environments, spinning disk will be the primary backup, combine that with virtualization and all the requirements around cloud compliance. It's a very interesting market. It's one that really you want to go with the leader on. I think EMC is poised here for some success. A lot of people aren't trying to crack this code, but it's not that easy. So I think this 66% share in this market by EMC is something that's a dividend, quite frankly, from their smart acquisition moves with data domain and Avamar and others. So here EMC is reaping the benefits of the over, as people said, the overpriced acquisition of say data domain. Remember, they were in a bidding war with NetApp for this. So here EMC has got the packaging. And I think that that's what customers want. I think budget constraints are really, really important, but also the data growth. So the question in my mind is this, is a rip and replace viable given that at the same time your business is exploding and the architectures are changing? So that's my angle. And you're absolutely right, that's the key issue. EMC's, the luxury they have is they have strategies for both. If you want to do the rip and replace and optimize for virtualization, that's what Avamar is all about, source side de-duplication. At the same time, if you don't want to, that's what data domain's about, pop it right in. Others are coming after them. I mentioned IBM and HP. There are others, smaller companies as well. Let's see if they can attack. We heard today earlier from BJ Jenkins about end-to-end. Yeah, I mean Dave, you and I have talked to CEOs in this business on theCUBE here. Tucci, Capelas, McDermott, the SAP, Schnabe. And all the top executives talk about flexibility for the customer. And I think ultimately the number one requirement is you got to know where you are on this backup rip and replace versus the continuous improvement. Because at the end of the day, the vendors in this space who want to compete and win have to offer the total solution, okay, and give customers flexibility of choice. John, we've got Stephen Manley, who's coming up next. He's the CTO of the EMC BRS division. Bill Holmes, VP of IT Infrastructure at Loomis to bring us the practitioner's perspective. And then we're coming back with Jason Buffington and David Floyer to have the independent perspective from our analysts, and so keep it right here. Stay tuned to this spotlight on the future of data protection. We'll be right back with SiliconANGLE.tv's continuous coverage of EMC World Live from Las Vegas. Be right back.