 Hi everybody. This is Dave Vellante. I'm live at Wikibon headquarters. We're here in our new studio Here with Stu Miniman on controls. Thank you Stu for setting me up today. You know the studio is coming along building out We got our new desk. We got a new signage and you know, it's we're making some progress here We're really excited about 2012 and and that's why we're here to do predictions 2012 big data flash cloud and Facebook now when I was at IDC I didn't do a lot of predictions I knew better, but I kind of got sucked into it at Wikibon and I've been having some fun with it Before I get into 2012. I want to look at 2011 Which was kind of mixed. I actually think I nailed it in 2010. I had some really good predictions three targets acquired Oracle goes to war with everybody. These are my 2010 predictions my 2011 were a little bit more mixed But I'll let you decide on how I did so here's my my 2011 review The first one was big data becomes more of an opportunity than a headache And you know, I think this is becoming obvious at corporations It used to be from a supplier standpoint that software was the main competitive advantage things like operating systems and databases And I think increasingly from the technology industries perspective Data and information in the way in which you manage and monetize that information is becoming more and more important from a consumer side from a customer perspective The way in which companies Manage their data and actually package and are reselling their data is becoming a source of competitive advantage So you're seeing this in a lot of different industries certainly financial and services Energy pharmaceutical health care government. I think this is becoming an obvious trend So I would say that was a good prediction the second one number two was little data powers big data What do I mean by that? We've got a situation now where we have an internet of things smartphones Devices appliances buildings. They're all instrumented. We live in a world of Devices that are instrumented that are smart and you know, whether it's automobiles or buildings or those things I mentioned They've all got microprocessors in them. They're everywhere and they're driving tons of data They're really driving a lot of the big data revolution So I think that's a correct prediction a number three sub hundred dollar smartphones are going to power that little data didn't happen in 2011 I thought that Android was going to take the market by storm with a sub hundred dollar Initiative I think the iPhone 4s said it all people lined up to buy. What is generally, you know, just an okay phone It's faster. It's nice serious junk, but people clearly indicated that they're willing to pay much much more than a hundred dollars So maybe this prediction comes true in 2012 with adoption in Africa and China and maybe India And I think it probably will but that prediction was wrong a little bit ahead of its time Number four apps everywhere fuel the data explosion I think this was in a correct prediction the killer app turns out to be the app And it's really again driving more data And I think you're going to see that extend into 2012 where the app store is going to come to the enterprise Number five. I called it the end of this ridiculous integrated hardware application data client model What does that mean? Here's what I wrote last year new application delivery models and the explosion of smart devices will combine With the continued adoption of virtualization to mean that we finally see the light at the end of the tunnel for end users For nearly three decades We've lived with a model of my PC is an island unto itself with an internet connection And the notion of virtual desktop infrastructure will evolve into one Where the virtual data and the application infrastructure are there no matter where I am and No matter what device I'm using my apps and my data will be always on always available backed up and secure well That really didn't happen in 2011 but I do think it's the generally accepted model that we've seen the end of the PC era It's not the most common deployment model, but it will be over the next three to five years My number six prediction of 2011 memory class flash proves to be the model of the future now Maybe again, this is not the generally accepted model of the future But to me the successful IPO of fusion IO and the fact that everybody's chasing fusion IO as the leader Really makes this a hit an accurate prediction in my view fusion IO just recently announced one billion IOPS but what got lost in that announcement was The ACM the auto commit memory which allows you to use flash as a dirt as a direct memory tier It's another step on changing the application model And I think that that prediction has proved to be the wave of the future I'll come back and talk a little bit more about that in terms of new applications think Facebook think iCloud Number seven the cloud becomes an integrated storage tier. That's another prediction that I made in 2011 I think I got it wrong My my vision was that the cloud via an ether ethernet connection and storage controllers would become a new storage tier I think automated tiered storage is starting to mature I think it's now ready for prime time, especially at the high end as David Fleuer just wrote But it was really a pipe dream in 2011. It really didn't happen. It was a prediction that was ahead of its time I think there's hope for this forecast even though some people might think it's off base like right now The cloud is isolated. It's for you know clear use cases like backup or archive or or small companies It's it's today not an integrated part of most IT shops So so that one I think was wrong number eight another one I got wrong cloud on ramp players become the hot new startup play Now you can sort of give me some credit on that because I think in the first half of last year This was a hot segment But like the one previous I think it was a bust frankly I mean we saw service really choke and had to lay off a bunch of people Nassuni did a huge pivot in the middle of the year twin strata You know they raised money another eight million dollars, but really I'm seeing more non-announcements in this space than I are real Customer activity that impresses me. It's unclear to me that this class of system is going to disrupt the traditional Storage controller space. I could be wrong. I mean I haven't given up on it yet But I just don't see the traction I've always questioned, you know the value of sort of on ramps and I think a lot of these on ramp guys are Repositioning and really trying to become more disruptive to the traditional controller market But I need to see more use cases and real customers before I'm convinced So I I have to give myself a thumb thumbs down on that one as the next one I said rising oil prices will have a ripple effect into IT budgets I think this was a case of you know like it's like on Sundays I'm afraid the Patriots are gonna lose so I might voice that but really in my in my heart of hearts I think they're gonna win but this didn't happen, you know, it might yet, you know, we see oil prices, you know creeping back up But I wouldn't say the recent you know so-called downturn in tech has anything to do with oil prices and ripple effects into IT budgets I think that just didn't happen, but it's something to keep an eye on And by the way, I'll come back and talk a little bit about that in terms of the so-called tech downturn Because I don't think we're having one. I think it's a it's an illusion Number 10 the backup market gets disrupted again. I got this one wrong. It did not happen EMC dominated in the back-up appliance space It's got two-thirds of the market with data domain and Avamar HP's recent announcements are taking aim at EMC A lot making a lot of bold marketing claims. We'll see what kind of traction HP can get I like HP's mojo I think HP you know trying to take on the leader is a good thing. It'll create good competition And and EMC is not sitting still HP's a big company. They're doing some other great things that I'll talk about but But as well, I was looking for data protection as a service type of models to emerge And and that really didn't happen in 2011. We saw some bits and pieces of it With guys like net app and sync sort doing some interesting things But you know just you really didn't take off in last year and I think I got that wrong So you can see I'm on a streak of of misses here and my last prediction was a it was a throw-in 10.1 And this was a long shot. I said it was a long shot I said EMC's core value will increase which was an interesting prediction. What do I mean by that? So EMC's core value I defined as the market cap the market valuation of EMC minus The value of its VMware ownership which it holds about 80% ownership of VMware now that value was hovering around 20 billion in early 2010 that value being EMC's core value It dropped to 18 billion in late 2010 and it closed 2011 at just under 16 billion So it's dropping consistently from 20 to 18 to 16. So the market ain't buying EMC's core business as a value generator, which I think is frankly crazy I think the core storage business is good. It throws off a ton of free cash flow But despite EMC's strong market share its growth and its ability to throw off cash It is fundamentally declining in value when you take out the value of VMware So the market says either storage is a lousy investment, which I don't think is true Or it says that EMC is going to dramatically tank its share of the market, which is possible But again, I don't see that as the case. I think EMC continues to execute very well It's got you know, it does a great job of marketing its vision or the market's dead wrong about the stock I wrote last year that I thought EMC was undervalued. I still think that's the case I think it's a great way to own VMware at relatively low low risk, but in any case, I was wrong about it last year So Don't shouldn't necessarily follow my stock picks. So that was 2011 At my look back, I'll let you decide how I did. I think it was mixed I think there were some good calls in there, but you know, I think I think 2012 I'm hoping for a better performance So let's look at 2012 and and see what's coming. No surprise big data flash and cloud are dominating And I've got some other vendor comment commentary in here as well My number one is big data is here to stay big data is not just the buzzword the big data fund announced by Excel partners a hundred million dollar fund is just the beginning. I think it's a drop in the bucket We're going to see more big data funds more big deals in this space More suppliers are going to be marketing big data and we're going to start to see a Substantive solutions hit the marketplace from traditional enterprise enterprise players Which is going to lend increased credibility to this market and accelerate adoption I think the ecosystem is maturing and and it's here to stay Number two Hadoop based big data solutions will intersect with traditional enterprise data warehouse offerings And I would make this prediction for even non Hadoop based Solutions such as Lexus nexus I think you're going to see the intersection between Hadoop and traditional enterprise data warehouse is happening all the big Enterprise whales are going to have solutions for Hadoop Where the needles that are found in those haystacks end up in traditional or emergent? Enterprise data warehouse solutions like a vertical for example large corporations aren't going to chuck this infrastructure They've got billions invested in that traditional and emergent Structured infrastructure for data warehousing and business intelligent tools It's not going to go away rather organizations are going to find ways to leverage the two and bring Structure to unstructured data Number three the Hadoop Wars are going to continue Cloudera was on a path to become the next red hat ten billion dollar market valuation for red hat Everybody wants a piece of that action Horton works spun out of Yahoo had some big you know venture funding behind it You're seeing map our team up with EMC. They're not going to let Cloudera run away with it I think those wars are going to escalate even though none of these vendors like to talk about it They don't like to admit it they are going after the big prize of course They want to focus customers on on proof points and business value But the reality is behind the scenes these guys are aiming for multi-billion dollar Valuations and value to be created So it's an interesting sort of dynamic there ultimately I think this competition is going to be while somewhat confusing for the marketplace initially I think it's going to be ultimately prove out good for the ecosystem and Here's the deal the winner in this is going to take by far the biggest prize They're going to create billions of dollars of value the number two guy here is going to maybe make a little dough And the number three guy will be lucky if they break even so That's why this is so important. You know the third place finishers really don't make a Lot of money in this marketplace, and you've got a really interesting dynamic our Jeff Kelly has written a lot about it We've covered it extensively. I think Cloudera right now is the darling child But in Horton works has done a great job of marketing its openness Cloudera really has to transition from a company that's largely done Training to one that wants to sell software a lot of customers out there aren't paying today for Cloudera And Cloudera software they've got to prove that that model can work they've done a great job of really creating a lot of buzz and then you've got EMC who's got a Distribution channel and got some credibility in the marketplace, and I think there's other other companies here playing I mentioned Lexis nexus. They are definitely one with a solution selling real Solutions to the marketplace solving real problems, and you can't leave out IBM IBM is a is a major player here And has a big analytics play and also watch HP with Vertica and autonomy in that space So number four in 2012 big data is going to be all about applications I really I stole this one from Jeff Kelly, but it was in my head And it's just too good to pass up with any emerging market really the rubber meets the road with applications That's what's going to drive adoption like any market. It's going to be highly fragmented like any applications market I mean it's going to be highly fragmented by industry There will be some some some horizontal applications particularly around, you know the analytics space We're going to see a lot of financial services and risk assessment and insurance and And and and big pharma applications health care government applications fraud security very specific and I think 2012 is going to see a lot of action around there number five I've got a way to get ways to go here folks I got ten of these so number five the flash hierarchy gets more granular. What do we mean by this for two decades? We have seen function migrate from the server out to the sand For good reasons for sharing purposes and and high availability and disaster recovery What's happening now is you're seeing function move back closer to the server. You're seeing Situations like fusion IO where applications are being written to take advantage of an extension of memory And flash is really changing that game. You're going to see in 2012 much more granularity across the flash Stack if you will you're going to see all flash players like solid fire, you know come to market And you've seen those are solid fire pure and others And you're also going to see management across that stack emcs project lightning is an initiative designed to really try to take more a Control of that stack and extend the traditional sand architecture into the flash hierarchy So you're going to see a lot of action there again big land grab fusion IO Leading that charge out to the early lead Great IPO a lot of mojo big announcement yesterday, and I think you're just going to see more and more action here Valuations are hot. They're going through the roof and for good reason Number six new cloud-based applications are going to emerge as a result of flash We've already seen this think about fusion IO and Facebook when you upload a picture into Facebook it happens so quickly the iCloud a lot of New emerging applications really taking advantage of that memory class flash and that's going that trend is going to extend It's going to accelerate we're going to see block-based applications being deployed in the cloud and cloud service providers Driven by and powered by solutions like I mentioned solid fire before all flash arrays that support new mission critical applications database and other High-performance applications are really going to start to come to the market in 2012 Number seven more it shops are going to becoming profit centers it for years has been a been a been a cost center That's the way that everybody's looked at it. That is changing it is becoming a profit center Not just a cost center and there are many many examples of this and I've written about this a lot We've seen it with USC NYSE Euronext Not only is the cloud you know become the archiving platform of choice But but cloud service providers from Amazon to establish players like IBM and CSC and others are proving that they can do security and availability well enough well enough I stress in the case of Amazon to entice Small players small companies, you know like wikibon we use we use Amazon And but medium size and large customers are looking for more They're looking to the IBMs of the world to the CSCs of the world So they can put their data in the cloud and trust it and this trend is going to accelerate in 2012 now I mentioned IBM I mentioned IBM is really interesting what's powering IBM at least a part of IBM's cloud is a company called Nirvonix so IBM and Nirvonix did a deal this year IBM is OEMing Nirvonix's Technology and delivering cloud services so this company in over Nirvonix was out there They were bumping along and really had a breakout year in 2011. I didn't predict that but but it happened They hired a new management team. They brought in Scott Genereaux from from former HDS former DDN former Q logic knows the enterprise business knows the enterprise storage business and What you're seeing with Nirvonix is they have great technology this didn't really know how to package it and market it that changed in 2011 there were very few enterprise technologies that are delivering what I would call true cloud There's a lot of cloud washing going on and we've talked about this here at at wiki bar on and in our partners at Silicon Angle What I mean by cloud washing people basically taking an existing product and putting a cloud face on it and saying okay Hey, we have cloud too Now we saw this year this past year in 2011 the Oracle public cloud well It's cloud, but it's expensive and it's all Oracle all the time EMC has at most you know It's definitely cloud-like you can build the clouds with it But you know look at Amazon Amazon made the model really with elastic computing No cap X up front. It's all op-ex, but the question then becomes can you guarantee quality of service? Look at Amazon's platinum service. It's a hundred and eighty thousand dollars a year on top of the existing service The enterprise players like nirvanics like a CSC for example They're not charging extra for that you know high availability. It's built in to the service Can you do audits enterprise customers need to do audits of the data center on? That their data is being hosted on Amazon really doesn't let you come in and do that Can you geographically control where the data gets placed these are the things that enterprise customers want and this is Why a company like like nirvanics is emerging and doing well? Amazon's SLA is really like this. Hey, we'll do our best, but if we don't We're sorry send us an email. That's really what what the Amazon SLA is about So people are looking for new solutions companies like nirvanics are solving These problems. They've got true cloud offerings. I get some inside, you know scoop on on nirvanics I've talked to a number of their customers USC Cernar dr. Fortress is a company out in Hawaii that I talked to IBM's a customer VMware's a customer Cisco's a customer, you know, I don't talk about that a lot But I've uncovered these things Johnson and Johnson NBC universal So the inside baseball on nirvanics is they grew like crazy in 2011 Triple-digit very high triple-digit sequential bookings growth in 2011 USC I talked to them they installed 8.5 petabytes of nirvanics technology So the petabytes under management they're exploding. They're hiring like crazy the hired the guy from Google Paul Fruton We've had him on the Cube very high on this company You know the bottom line is it's a very disruptive Technology from the standpoint of moving capex to op-ex and it's taking share from the traditional storage model My prediction number eight storage is no longer a two-horse race for years It's been EMC and I and and and and net app as the pure plays storage companies Really banging heads with with each other in 2012 That's going to change and it's we've already started to see it change Three par is gonna rapidly gain share again when I came back into the storage business after I left I asked my friend John MacArthur who should I look at who were the interesting companies? He said there are three that you really need to start with the first. He told me was three par The second was data domain and the third was compelling I love love love three par technology I love it till my daddy takes the t-bird away as the tech as the saying goes three par grew a triple digit Growth rate last year. They grew much faster than they did as three par independently. So they've got put into the HP You know framework and it's been exploding. My prediction is that three par will continue to grow at that triple digit rate It'll make inroads into the high end in 2012. It's trying to redefine what tier one is Focusing on simplicity. So so that's my prediction. They're going to continue to grow very rapidly And they're gonna they're gonna hit both the high end in the mid-range segments My other prediction here is I think Dell is very dangerous. It's particularly with compelling Dell has in a big supply chain great distribution channel. Basically Dell has replaced EMC With its own IP. It's acquired equal logic Compellent Ocarina Exonet has to integrate those for sure But it really is doing a good job with regard to as I say replacing the EMC revenue and so look for HP and Dell to be become much more significant players in the storage market in 2012 My number nine prediction Oracle the first disappointment won't be the last now people say I'm really hard on Oracle I am hard on Oracle. I love following Oracle. I think they're really intriguing company I have great deal of respect for Oracle, but it's you got to get a call it like it is on our Oracle's last earnings call The company blamed softness on the its softness on the longer sales cycles due to slowness in Up-to-chain approval processes for its customers and observers also took this to to mean a and across the board softness in IT in technology. It's all BS in my opinion. Here's what's really happening Oracle plain and simple is arrogant. It starts from the top Ellison, Safra Katz, Mark Hurd I'm sorry. They just they are arrogant and it trickles down. I've said it before Oracle is like a giant Telco. They're extracting rents from their customers They were the only company that I know of in 2009 in the middle of the tech downturn that raised prices They have they conduct onerous audits their their contracts are convoluted They play hardball with their customers and people are pushing back. That's what's happening companies like Salesforce and Workday who have a software as a service model who have software that's as good if not better than oracles are delivering it with lower cost more simplicity No big expensive cap except front no onerous contracts that Markets gonna change Oracle is becoming the new CA and that's what's happening in the marketplace So my prediction is the first disappointment of Oracle isn't gonna be the last you're gonna see more bumps on the road for the company Even though again the company is one of the best if not the best at acquiring companies, you know Oracle and IBM They're not going away Not predicting oracle goes away, but I do think you're gonna see more bumps on the road You know the Sun acquisition which I've been on record saying it was fantastic Has seen some bumps in the road declining revenue. So look for more troubles out in Redwood City Number 10 my last prediction the Facebook IPO is going to be a boon for tech I do not think that tech is in a big softness of Facebook's gonna go public in 2012 and like the big tech IPOs before it Netscape and Google Netscape in the late 90s and Google in the mid 2000s Facebook is gonna actually Netscape was in sort of the mid to late 90s Facebook's gonna catalyze a huge tech momentum in 2012 from an investing standpoint So the rising Facebook tide is gonna lift lift all the tech ships that can play in Analytics social media the things that you know really are driving the mobile the things that are driving the marketplace today Billions are going to be made for tech investors not everybody's gonna win You've got a position yourself you know to take advantage of this But the the big players are the ones who can play it Position themselves as is hot and picking up on the emerging trends big data in the enterprise for example are going to do really really well So those are my predictions for 2012. I'm sure I missed some I'm sure you have some agreements and disagreements with me. I love to hear him Tweet me at D. Volante Hit the wiki bond blog make a comment on my predictions post, you know hit wiki bond I really appreciate you guys watching. Thanks everybody for your support in 2011 2010 and 2009 2008 2007 It's been an amazing run here at wiki bond really appreciate Everything that that you guys have done and and and you've been a great audience Look for more Cube gigs will be out in California at the end of the month at node summit I'll be there my partner John Furrier at Silicon Angle and thanks everybody for watching and have a great 2012 Bye for now