 Live from San Francisco, it's theCUBE. Covering IBM Think 2019, brought to you by IBM. Hello everyone, welcome to the live coverage here at theCUBE in San Francisco for IBM Think 2019. I'm John Furrier, Dave Vellante. We're here with Irvan Krishnan, Senior Vice President in Cloud and Cognitive Software at IBM, man in charge of all the cloud products, cloud everywhere, AI anywhere. Irvan, great to see you. Thanks for spending the time. I know you're super busy. Thanks for spending the time. I'm pleasure to be here, John and Dave. Great to see you. So we talked at the Red Hat Summit last year. You essentially laid out the vision for microservices, Kubernetes, how this all was kind of coming together. Then the Red Hat acquisition, and now you're seeing big news here at IBM Think, setting the stage here in San Francisco for AI Anywhere, which is cognitive kind of all over the cloud, and then really clarity around the cloud, multi-cloud strategy, end to end workloads, all kind of tied together on-premise in the cloud. Super important for IBM. Explain and unpack that for us. What does it mean? So I'm going to begin unpacking it from where actually I left off last year. So just for 10 seconds. Last year we talked a lot about containerized platforms are going to become the future. That'll be the fabric on which every enterprise is going to build their IT and their future. Okay, so we talked about that last year and I think with the announced acquisition of Red Hat that gets cemented and that'll go further once that closes. Now you take that and now you take it to the next level up of value. So take Watson. Watson runs as a containerized set of services. If it's a containerized set of services, it could run on what we call cloud private. Cloud private in turn runs on top of OpenShift. So then you say wherever OpenShift runs, I can run this entire stack. Where does OpenShift run today? It runs on Amazon, it runs on the IBM cloud, it runs on Azure, it runs on your premise. So on the simple, simple, I always like things that are simple. So Watson runs on cloud private, runs on OpenShift, runs on all these infrastructures that I just mentioned, that gives you Watson anywhere. You want it close to your data, run it on prem. You want to run it on Azure, run it there. You want to run it on the IBM cloud, you run it there. And hence that's the complete story. That says it was more important for you to give customers choice than it was to keep Watson to yourself to try to sell more cloud. I think that every company that survives a long term learns that choice to a customer is really important. And forcing customers to do things only one way is generally in the long term a bad strategy. So from a customer standpoint, just so I get the facts right on the hard news, Watson anywhere now, I can run Watson via containerization, OpenShift, things you mentioned, on AWS, Azure, Microsoft, Azure, and IBM's cloud, cloud private and all that. And on premise. And on premise. All cohesively end to end. Correct, in an identical way, which means even if you do things one place, you build a model in one place, you could go deploy a model in another place. So it gives you that flexibility also. So I'm a customer state. All right, but this sounds too crazy. It's too hard to do that. I've tried all this multi-cloud stuff. I got all this stuff. Why is it easier? How do you guys make this happen? What is the key secret sauce? We're pulling that end to end AI anywhere on multiple clouds, on premises, and through the workloads? Two levels. One, we go to a container infrastructure as that common layer that isolates out what is the bottom infrastructure from everything that runs on top. So going to the common services and a Kubernetes and a container layer that is common across all these environments does the isolation of the bottom infrastructure. That's hot engineering, but we do that engineering. The second piece is, you've taken the Watson set of capabilities and also put them into just three pieces. Watson Studio, Watson ML for Watson Machine Learning, and Watson OpenScale, and there you have the complete set that you go need to run everywhere. So we've done that engineering as well. Well, congratulations. I want to get the cloud anywhere. I mean, it's cloud. It's essentially everything's anywhere now. You've got data everywhere. You've got cloud everywhere, cloud operations. Where's the multi-cloud and hybrid fit in? Because now if I can do AI anywhere via containerization, shouldn't I be able to run any workload on premise and in multiple clouds? So we fundamentally believe that. So when I was here last time, we talked about the container fabrics. And I do believe that we need to get to the point where these can run anywhere. So you take the container fabric and you can go run that anywhere, right? So that's one piece of it. The next part up is, but I now need to integrate. So I now need to bring in all my pieces. How do I integrate this application with another is the old problem of integration back again. So whether you want to use MQ or you want to use Kafka, you want to use one of these technologies, how do I get them to couple one workflow to another workflow? How do I get them to be secure? How do I get them to be resilient in the presence of crashes, in the presence of latency and all that? So that's another big piece of announcements that we're making. You can take that complete set of integration technologies and those can run anywhere on any cloud. Again, using the same pattern I described, I'm not going to go into that again. And on premise, so you can now knit all of those together. Arvind, can you talk about the rationale for the Red Hat acquisition, specifically in the context of developers? IBM over the years has made many efforts to court developers. Now with the Red Hat acquisition, it's eight million developers. And talk about specifically the importance of developers and how that's changed your strategy or enhanced your strategy. I'm going to enhance it, it's not really a change. I think we all acknowledge developers have always been important and will remain important. I mean, IBM has done a great job, I think over the last 20 years in both helping create the whole developer ecosystem, for example, around Java. We were a very big piece of that. Not the only participant in there, there were others, but we were a big piece of that. So you now take Red Hat and Linux and OpenShift and Open Source and JBoss and all of these technologies. There's a big ecosystem of developers. You mentioned the eight million number, but why did that set of people come along? They come along because they get a lot of value from developing on top of something that in turn has so many other people on top. I think there's half a million pieces of software which use Red Hat as the primary infrastructure on which they develop. So it's the network effect that really is that value. And the network effect can only come from, you keep it open, you keep it running on the widest possible base, and then they get the value that if they develop on that, they get access to that entire base on which Red Hat runs. So it totally makes sense? Totally makes sense, but I want to dig deeper on that. We cover a lot of developer, the business side of developers, not so much ins and outs of developer tools and stuff. There's a lot of stack overflow variety, other sources do that. So developers want two things. They want to be on the right wave. You're laying out a great platform for that. Then there's monetization. Amazon has seen massive growth on their partner network. You guys have an ecosystem, you mentioned that. How does this anywhere philosophy impact the ecosystem because they want to partner with IBM. Where's the white spaces? What's the opportunity for partners? How should they evolve with IBM? What's your direction on that? Okay, so two kinds of partners. One, there's a set of partners who bring a huge set of value to their clients because they actually provide the domain knowledge, the application-specific knowledge, the management expertise, the operational expertise on top of technologies perhaps that we provide. That set of partners is always going to have value. I talked yesterday at a partner world conference about what Cognizant, who's a bigger partner, they do. They build a self-service application for patients of a medical provider to be able to get remote access to doctors when they couldn't get in or when it was not life-threatening immediately. Well, that's a huge set of value that they provide built on top of our technologies and products. A second kind of partner where you went on developers is people who do open-source packages. I think we've been quite good. We don't tend to cannibalize our partners unlike some others we can talk about. So for those partners who have that value, we can put our investment in other places but we could help maybe give access to the enterprise market for those developers, which I think opens up a lot of opportunity. You guys make the market for developers. That's right. All right, I want to ask you a question. You guys are obviously been all in on Kubernetes. Red Hat made a great bet on Kubernetes and now that you're harvesting that with their acquisition, huge growth there. Containers, everyone saw containers. That was kind of a no-brainer, technical world, developers saw it. What's the importance of Kubernetes? As you see Kubernetes starting to shrink the abstraction software overlay in this new complexity where Kubernetes is providing great value. What does that mean, this trend mean for CIOs, CTOs, CSOs? As enterprise start to think cohesive set of services across on-prem, multiple clouds, Kubernetes seems to be a key point. What is the impact of it? What does it mean? I think I'll go to the business benefit. Kubernetes in the end is an orchestration layer. It takes away management complexity. It takes away the cost of doing operations in a large cluster of physical resources. I think the value for the CIO level is the following. Today, on average, 70% of your total cost and people are tied up in maintaining what you have, 30% is on new. That's the rough rule of thumb. Technologies like Kubernetes have taken to where we want it to go. Can flip that to 30, 70. Meaning you need to spend only 30% maintaining what you have and you could then go spend 70% on doing innovation which is going to make your end client happier and your business happier. Your teams had a couple of announcements today. One was HyperProtect and the other was a lot of services to facilitate hybrid. Can you talk about those and bring us up to date on it? Yeah, a quick one. So HyperProtect means, so when you put your data in the cloud, everybody gets worried about, well, if it's in the clear, it could get stolen. So you go to encryption. Typically, encryption is then done with a key. Well, who manages that key? The HyperProtect services are all about that key management is common across both, again in a hybrid world, across both your premise and in the cloud. And nobody in the cloud, not even our deepest system administrator in the cloud, can get access to that key. That's pretty remarkable when you think about it. And so that provides a level of safety and encryption that should give you a lot of reassurance that nobody can get hold of that data. That's HyperProtect. And then if I go to all of the other services we're doing, some clients need a lot of help, some want advice, like in the three client meetings I just had, every one of them was asking, what should I keep where I got it? What should I slightly modernize? What should I write new? That to me is a whole lot of advice that you need on how to assess what you have and what should be your correct strategy. Then once you do that, somebody will say, well, help me move it. Others will say, help me manage it. So all the services to go do that is a big piece of what we're announcing. End to end. End to end, in addition to, but end to end, but also you can carve it up. Nope, only give me advice. Or nope, I got my strategy laid out, help me move it. Or nope, do both for me, or help me manage it after I move it, et cetera. Harvard, when you sit in customer meetings, big clients write me in, when they say we want to modernize, what does that mean to you and how do you respond to that? Well, so modernize is normally today, it means that you've got to bring cloud technologies, you've got to bring AI technologies, you've got to bring what is called digital transformation all to bear. It's got to be in the service of either client intimacy or it's got to be in terms of doing straight through processing as opposed to the old way of doing all the business processes that you have. And then you get into, always got to begin with some easy wins. So I always say, begin with the easy stuff, not begin with the harder stuff, but start with the architecture that lets you do the harder stuff later, it's not throw away. And those are all the discussions that we have, which are always a mixture of this people process technology, that world has not changed, we need to worry about all three. Arun, thanks for spending your valuable time coming on theCUBE. We appreciate the insight, I know you're super busy. Final question, take a minute to explain this year, think what's the core theme, what's the most important story people should pay attention to this year at IBM Think in San Francisco? I think there's two things and the both is that it's the evolution that is giving greater business value. We're using the word that is chapter two of the cloud journey and it's chapter two of a cognitive enterprise. So chapter two means that you're now getting into solving really mission critical workloads and that's what is happening there and that's enabled through the mixture of what we're calling hybrid and multi-cloud strategies. And then the cognitive enterprise, it's all around, how can you bring AI to power every workflow? It's not a little shiny talk on the side, it's in the very heart of every transformation. The word of the day here is anywhere, cloud anywhere, data anywhere, AI anywhere, it's theCUBE, we're everywhere and anywhere we could go to get the signal from the noise, Arvin Krisch, the senior vice president of cloud and cognitive software's new title, man architect in the red hat acquisition in the cloud, multi-cloud DNA, congratulations on your success, looking forward to following your journey. Thanks for coming on. Great to see you. Thanks, John, thanks, Dave. Okay, more live coverage after this short break. Stay with us at theCUBE.net is where you find the videos. We're in San Francisco live here in Moscone, north and south, bringing you IBM Think 2019, stay with us.