 Live from the Austin Convention Center in Austin, Texas, it's theCUBE at Dell World 2014. Here are your hosts, Dave Vellante and Stu Miniman. Welcome back to Austin, Texas. Everybody, you're watching theCUBE. We're about two miles from where it all started and Michael Dell, it is our pleasure to have you back in theCUBE. Thanks for coming on. Thanks for having me. Glad to be with you. So it's been an amazing transformation. I got to say, two things strike me. One is you're taking the company private. It couldn't have been time better. Like you said, all the headlines were dead wrong. And the second is you actually beat the great icon at his own game. So congratulations on both of those. And that doesn't happen a lot. Thank you. So talk about being private and what it means. I know you've written a lot about it. You were on CNBC with the circus clowns yesterday. You were very nice to those guys. I know you weren't calling them circus clowns. But it's been all the news. You've been very vocal about it. But tell our audience what it means to be private. Well, a year ago when we completed the privatization we had an event inside the company. And we were playing loud rock and roll music and we had chains unleashed and we just told our teams we're going for it. We're going to invest. We're going to grow. We're going to go take over the enterprise, the data center. We're going after security and software. We're going to grow our share. And we've invested in the business and it's working. And we've unleashed a kind of passion and energy among our teams. And here at Dell World we're showing off the inventions and the innovation that we've been able to create just in the last year. And it's resonating unbelievably well with our customers, the partner community. We've got incredible momentum in the business and growing all across the world in every single business. And so it's a lot of fun. Not managing with the 90 day shot clock. So being in control of our own destiny and having all these wonderful customers giving us great feedback, it's all good. Well, you talked about, you wrote about and talked about the plague of short term thinking in our markets. And they were asking you yesterday on CNBC do you think that can change? Do you think it should change? I mean, U.S. companies have done very well with that short term thinking. But I feel like there's all these things happening in the business. People are splitting up. People are selling their businesses. People are paying people to take businesses. And it's all due to this financial pressure. What's happening? You know, I think anything taken to an extreme can be bad, right? Whether it's shareholder activism or anything else. But it's not always bad. But you kind of have to step back and think about, first of all, what is the purpose of an enterprise over a long period of time and who does the enterprise serve? And so when I look at the things that are going on, I kind of ask myself two questions. First, is this really good for the customers of the business itself? And if it's not, that ought to raise some questions. Second question that I ask is, okay, if the principals own the entire business, is this something they would be doing? Or are they doing it because there's a short term influence in a particular period of time? And, you know, that may not lead to the best outcomes over a long period of time. And so this is just a different perspective. So John Furrier couldn't be here. He senses best. And so I was talking to John beforehand. I said, what should I ask Michael? He said, okay, here's the deal. I asked Michael this. Like I said, we're two miles from the dorm room. You're 18 years old again. It's 2014. What do you got cooking? You know, I think definitely starting a business. Let me tell you. You've got kind of a big dorm room here, Michael. This is pretty good. Well, you know, here we got the world's largest startup. So the great thing is we have capital and intellectual property and customers and momentum. So, you know, we're doing it all over again. But look, we're in an incredible time where there's just an amazing set of possibilities around the impact technology can have in our world. You look at what's going on in what we call the data economy as sensors are, you know, out there and instrumenting everything. The cost of silicon keeps coming down and companies, organizations are rethinking what they do with all that information. You look at what's going on in biotech and being able to now unlock a lot of the mysteries of health and science with all this computing power. So there's just a ton of opportunities. We got plenty on our plate, you know, as Dell and we're growing nicely and we'll continue to invest. Stu, I know you're dying to jump in. If I don't let you, you'll never get a word of it. So go ahead. Thanks, Dave. So Michael, you talk about being the world's largest startup in innovation. What I want to understand is inside the company, you know, have you made or is there a plan to kind of change things inside? Because obviously you don't have to answer the Wall Street now and that does change yourself. And we've talked to some of your general managers as to how that trickled down. But, you know, when you look at big companies, you know, big companies typically don't create a lot of the new innovations. It's the small little startups, you know, just large organizations, organizational size is usually the antithesis of allowing me to move fast and nimble. So what are you doing to, inside, to kind of change and incent that innovation? Well, you know, we have a number of startups with Dell and we keep starting up new businesses. I think at the core of your question is the acceptance of risk. And you have to re-inject the acceptance of risk in the business. And if you're managing with a 90-day shot clock, you don't take a lot of risk, right? Because you want to meet that guidance. And so that's all gone, right? We are accepting risk. And we are placing bets across the business. As Tom Sweet, our CFO, and I travel around the business, we, you know, hand out more money to go take risk and go invest in the business. And not all of them will work. That's fine. But they're mostly working and the business is doing just fine. We also have Dell Ventures. And, you know, we're continuing to invest in interesting startups that are doing great things out there. You're right. You know, that over time has a better record than large companies. But Dell itself has a record of expanding organically and with acquisitions into new spaces. And we've built, you know, some pretty impressive businesses in the enterprise and software and security and services, both with a foundation of acquisitions and continuing organic investment. You've done very well with acquisitions. I wanted to ask you a question on the record here because when you went private, some of your competitors said to me, oh, Dell's in big trouble now. They're not going to be able to make acquisitions because they paid for it with their free cash flow and now they won't be able to do that because they're paying off debt. I said, wait a minute. I started to squint through the numbers. I said, Dell throws off enough free cash flow and now that doesn't have to pay dividends and to shareholder stock buybacks, it's going to be able to continue to fund acquisitions. Can you clear that up, Morris? Yeah, so if you look at it just from the cost of what did we spend in dividends? What did we spend in share repurchase and what did we spend in interest expense? It actually costs a lot less to be a private company than it costs to be a public company. And so we actually have more capital. So we'll continue to make acquisitions. But I think the important thing is not just make the acquisitions. It's how do you make them successful? How do you buy a company that has 6,000 customers and over a period of few years, get it to 150,000 customers? And we've been able to do that actually repeatedly with the kind of acquisitions that we've targeted. Yeah, you're clearly one of the top acquirers of companies. I was doing some research. I would say in the last nine months you probably know this, but you've probably done 50 launches. At least. I wonder which ones, maybe pick two or three that excite you the most. Maybe there were some yesterday. Share with our audience. Well, you'd have to say the 13th generation PowerEdge. I mean, no question that that is the core of the data center. And we're big believers in software defined and software based networking and storage. And we've seen this trend for some time where because of virtualization and cloud-based models workloads are moving into the compute layer. And you look at the R730XD as an example of this, a 2U server, 36 microprocessor cores, up to 1.5 terabytes of DDR4 DRAM, 440 gig ports, 100 terabytes of storage, all on a 2U platform. Just amazing performance. That kind of data center is clearly an important one for us. Yeah, at a price point that brings that kind of technology. And we're gaining share. I think you saw in terabyte shipped, some people like to talk about revenue, that's all fine. Revenue is great. We got revenues too. And the revenues are growing, trust me. But in a world where the game is changing, where the network is becoming software-defined, the storage is becoming software-defined, yeah, look at the whole thing. Internal storage, external storage, combined all together. We're number one. We're growing. Other guys are shrinking. And look at what we talked about on stage just yesterday with our new PS42110 igniting the whole ecological install base. Six times performance improvement from the prior generation with a starting price of $15,000, an all flash array under $25,000, the lowest entry price. And then this XA90 DCS server, 720 terabytes in a 4U platform. So whether it's software-defined, all flash, we are really setting the pace for the data center of the future. Well, and you're now the only, once HP splits up, you'll be the only end-to-end supplier on the planet. And I think if you're going to be end-to-end, you have to have both ends, right? Or else it's the end. Who would have predicted that? So you obviously, Dell, made a name in Direct. Cloud appears to be the new Direct model. So how do you stay relevant in Cloud? I think there are, you know, certainly lots of, you know, interesting growth vectors around Cloud. What we see primarily from the enterprise customers is the growth of the private Cloud. And, you know, if you think about what's going on in the world, software is really advancing rapidly. And when I look at the public Cloud, if you think about the public Cloud, if you think about the public Cloud as kind of perfect efficiency, the private Cloud's getting better and better, okay? So we saw Evo Rail. We saw the Microsoft Cloud Platform system. We've seen what Red Hat is doing with OpenStack. And by building these hyper-converged systems, we're able to now give the customer the efficiency of the public Cloud with the privacy and security of the private Cloud. And we certainly have, you know, tools to help customers manage whatever Cloud platform they may want to have. But we think the answer, there isn't just one answer here. And we're seeing tremendous growth in private Clouds. And of course, you know, we've got the hardware, the software, the services to help make that happen. Well, your competitors must be seeing that growth too. But unlike your competitors, you don't feel compelled to own your own data centers globally and start selling services. We're not competing with the public Cloud partners. We provide them a lot of infrastructure. We have this great marketplace. So our, you know, you've got 600 telcos out there, all getting in the Cloud space. You have all the, you know, well-known companies getting in the Cloud space. Those are our customers. And, you know, as, you know, lots of customers want to go to the public Cloud, will help them go there. They want a private Cloud, will help them go there too. And you got to manage this whole federated world of public and private. Will help do that as well. I was struck two nights ago when I got here, walking the show, networking Flash converged. I had to write it down. Oracle systems, Flash, Cloud, OpenStack, VMware, Docker, NFV, IoT, Big Data, Hyperscale Services, Security, System Management. What'd you expect? And I'm just scratching the surface here, right? Beneath these, you've got, you know, unbelievable portfolio that you've amassed. You know, your colleague, Joe Tucci, says it's better to have overlap than it is to have gaps. Do you agree with that sort of scenario? I think in the software-defined world, you know, you've got to give customers choice. And, you know, you think about the major providers today like Microsoft, VMware, Red Hat, certainly work very closely with all three. We can't just pick one, right? We pick a ball, right? And customers decide. So we're big believers in choice. Yeah, so we're getting the hooks shortly, but I have to say again, you know, having the founder at the company, John and I have always talked about you and your leadership and how great that is. We said the same thing about Larry Ellison. I mentioned Joe Tucci. Somebody in the crowd asked me, asked Michael, what would you do if you were Joe Tucci and Elliott Management had you in a headlock? His name's not Egan. He's done a lot. What would you do if you were Joe Tucci? Well, you know, I talked to Joe a little bit about that and I'll keep my conversation with him private. Right, fair enough. So he sought advice. We'll leave it there. Michael, congratulations on everything. As they say, Stu and I and John and the Cube team are just honored to be here to document this. We'll be watching. We think it's going to be one of the greatest moves in the history of the business. And we talk about the VMware acquisition all the time. We think actually you could create more value, which is a lot. So well done. Congratulations. Thank you. Thanks very much for coming on. Thank you. It's a pleasure. All right, keep it right there. We'll be back with our next guest right after this.