 From San Francisco, it's theCUBE, covering Radio 2018, brought to you by VMware. Hello everyone, welcome to the special CUBE coverage here in San Francisco, California. We're at VMware's Radio 2018 event. This is their annual R&D event. We're all the best people, smartest people come together to collaborate on new projects, new innovations, not imitation innovations, had great speakers up there. They had Steve Herrick, CUBE alumni, now a venture cab is formerly CTO of VMware. And our first guest here today is Ray O'Farrell, Executive Vice President of CTO of VMware, been on theCUBE before. Great to see you, thanks for joining us. Yeah, great to see you, good morning. So I love this event, because it's like you mentioned before we came on camera, Steve Herrick said it's like a sales kickoff for engineers. Correct, yeah. Which is like a rah-rah, but also really motivating, but also putting out the North Star, which is the innovation message. So take a minute to talk about what this event is. Explain to the folks what is Radio 2018, there's a lot of history involved here. Behind us is a T-shirt row of, you know, key milestones in VMware history. Think inside the box now, think inside the cloud. What's this event about? So the event has quite a few years, this is like the 14th year we've done this, right? And when it started, what it was really focused on was in some ways a recognition that as the company begins to grow, as you begin to build new products and engage in new partnerships, in order to keep innovation alive, you obviously need to manage it. The problem is you can't manage innovation, almost by definition, it's something chaotic, it's an inspirational idea, it's something that was not expected, that's what makes it innovation. But what you can do is you can create a culture which promotes that innovation or creates opportunities for those ideas to emerge, or when those ideas to emerge, make sure there's a place for them to be heard and there's an opportunity for a network to build around them. And radio is a part of that. We have lots of other programs in VMware to help keep driving that culture of innovation where radio is probably the premier one. Talk about some of the history from this event. What has come out of these events? Because I want to get into some of the specific questions around how R&D works these days, these are V how it used to work. But specifically what has come out of these events? Can you point to any things that kind of popped out, say, you know, because R&D, I won't say hit or miss, but it's the idea is to experiment and try new things and nail it. What has come out of VMware's radio years of history? Yeah, so very practically, we get a lot of patents out of radio. That's just a very practical sense. As people are building up the papers, as they're looking at the ideas they want to drive, as they work with different teams to build prototypes, quite a few times people will do that at radio when they're making a presentation. They'll generate ideas, invention, disclosures, which generate new patents. This show alone, even though, you know, we're just actually entering the show at this stage, has already generated about nearly 240 IDFs. A lot of those have the potential to become patents. So it's very, very practical and pragmatic about the generation of your patents and new ideas. When you look at the product side of things, quite often what you see at radio is not necessarily a new product in a whole new area. What you tend to see is we've existing technologies bubbling in different spaces, and now because you're able to bring these teams together, somebody gets an idea that says, oh, I can combine machine learning with what we're doing in terms of logging, and now I've got an interesting product to help support our customers, you know, deal with real world products. Just not take that hill, build me a blockchain product. It's more of take a step back, zoom back, look at the big picture, understand the fusion of where things are coming together, look at architecture. Is that kind of the? Yeah, actually sometimes there is to take that hill, take the blockchain product, but quite often it starts at something small. You'll have a radio event where somebody will say, blockchain is cool and interesting. Here's how you run it in a more efficient fashion on vSphere, something like that. And that will be a poster session. And it's only then when somebody sees that that says, I can really run blockchain on vSphere, can I do it better even than on physical in some way? And that's when the story emerges. So you don't necessarily see the product announcement coming from radio itself. What you see is the core of that idea, and then a few months later or the next major VM world or two VM worlds out, you begin to see these things. It's like you're creating sparks of innovation, throw out of the fire, create some action. That's exactly the way it works. Things like a lot of stuff, what we do in containers. The VM were integrated containers, the combination of containers and VMs from a security point of view. You can trace a lot of that back to ideas that were generated for radio. And it's pretty rigorous. People have to go through submit papers. This is submit ideas. Our most senior engineers crawl all over those and critique them. So you see... So it's competitive. Oh, it's very competitive. And it is, in many ways, it's a mark of honor to be invited to radio or to present a paper. And so people fight very hard to do so. Built-in gamification called Just Be Smart and Show Some Good Papers. Yes, it's a little bit tougher. How much goes into the prep for this? Because obviously that's a great bar. You guys said a high bar, like it's great. And it's a great place here for people to stretch and flex their technical muscle. What's the process? How do people get to that bar? Do they collaborate? Is there meetups? Is there organic processes atop down? How do you guys handle it? So we've a lot of different programs around driving innovation. But when you look at radio itself, and it leverages some of those others, when you look at radio itself, basically we create a radio committee. The one for next year will be starting somewhere in the next couple of weeks, right? We create a radio committee. It is typically driven by members of the Office of the CTO, but works and pulls in our fellows, our principal engineers, and we form a committee which really splits into two different directions. One of which is all around the technical papers, the presentations, which are going to be presented later here today. And another one which focuses around how do you do the keynotes? How do you get invited speakers? How do you create this inspirational, pervasive sense of innovation? And so you have those two groups working while cooperating somewhat independently of each other. And it takes a long time. So for instance, approximately, only about 15% of the papers which are actually submitted are presented here. So there's a lot of work going through, scanning those, combining those. One of the most exciting things you can do at VMware is if you go back somewhere in around the February timeframe, all of our most senior engineers sit in one of our largest conference rooms with a bunch of engineers submitting papers and so on. And there is a lively debate working through paper after paper, idea after idea, and saying, is this a good thing for radio? Is this original? Hey, nobody else thought of that. What are we going to be able to do to do that? Or in some cases saying these two people, one from Bangalore, one from Bulgaria, we've are on these sites all over the world, these ideas look similar. Can we get those guys to talk to each other and see what comes out of it? Yeah, so it's kind of a team building exercise at the same time, created innovation. But it's interesting, you mentioned you got the challenge of the papers, which is get the accuracy on the facts, original content, original ideas, and then the content program for the event has to be inspiring and motivating at the same time. Two different things, but two design standards for you guys. And we need to combine them both. And 80% to 90% of the people who are here are hardcore R&D engineers. Their day job is to write code, produce product, architect product. And if you haven't worked with a group of senior engineers, they are not going to be tolerant of presentations, which, oh, we saw that before, or fluff. They want to get hardcore into the meet. In fact, the presentations that you see that get some of the highest ratings tend to be those that are deeply technical in nature. VMware's software base is primarily system software systems engineering. They expect to see deeply technical solutions to how to attack some real work. You guys do have some smart people. It's great having theCUBE. It's our ninth year doing VMworld. Great to start coming into more technical events. It's fantastic. So the question I got to ask for you is Pat Gelsinger always says on theCUBE, he says on theCUBE a few times, but it's a consistent theme. You got to get out in front of that next wave or your driftwood, to the point of don't just take that point product of you, jump on the wave, and the wave is all about the next 10 years or 20 years. What is the way that you guys are, you would categorize, obviously cloud is key, but as you have the hyper-convergence and the on-premise private cloud booming, vSAN's great, we've seen great results from that. The cloud's right there, Amazon, you got Microsoft kicking in butt on the numbers. As the R&D tries not to get caught up into the fashionable day to day, you got to have the long view. What's the way for the long view? So I think there's two ways we look at that. One of them is you need to spend a lot of time with your customers and understand what their agenda is, what their innovation agenda is. And when you look at that, you see products popping up. How will I leverage AI in a new and interesting way? How will I do something with blockchain? I want to run AI algorithms. I need different hardware and different management software to do that. So we focus on those and make sure we're doing that. But perhaps more importantly, I think when you begin to look at what's happening with the industry right now, you saw private cloud, you saw public cloud, you see how you connect these together. It's actually that connectivity is going to be important. I believe you're going to see the emergence of edge infrastructure, but isolated? That's not powerful. Now combine that edge infrastructure with how you can leverage what's going in the public cloud or how you're going to be secure all of these in a way that falls back into even telco in some way. You're now beginning to see the synergy across all of those things. And I think that's where our sweet spot is. We know how to deal with those hard, how do I connect things together? How do I manage complex, a different piece of system software? So that's where we're going to see it. It's great stuff. One of the benefits of being so close to VM over the past nine years, and I was showing you some of our online data analysis. When I look at the VMware ecosystem, you interesting see the evolution of the journey 14 years, and looking at the milestones. Clearly infrastructure. On-premise data center then. And then you saw the emergence of the clouds. You start to see these markets emerge. Cloud, big data comes on the scene. Data warehousing begins. Now that's AI, cloud is bigger. All kind of taking a little bit off the infrastructure, kind of squeezing that down, but it moves up into the cloud. And now you've got over the top, blockchain, cryptocurrency, decentralized applications. In the middle of these circles is security, IoT and data. You guys are right there. So I have to ask you, because they're all the confluence of all those are coming together. You're not up here to play blockchain, although there's some stuff we can get into. You got some AI influencing it. So in the center of infrastructure, cloud, AI and blockchain, et cetera, is security data and IoT. How does that come in together? What's the R&D tasks to... Yeah, so actually the key word I think you used there was confluence. You cannot really look at these as independent things. And so our focus is what does it mean to be essentially the infrastructure and the infrastructure management story for that new form of multi-cloud age IoT type of a narrative, right? So our role there is, we believe security is one of the key things to focus on. And we believe that in that new world, connectivity is a key part of what goes on. The edge must talk to the cloud. The cloud must talk to the telco. The telco must talk to the IoT device. They need power. Right, they need power. They need communication. They need those things. So a lot of the time, a lot of where we focus comes back to NSX. We do believe that software defined networking is a key way of being able to deliver a new fluidity of when you get that confluence. And NSX very quickly brings you into security. That's how you begin to understand how you isolate those components, understand what you need to do to detect. When that edge IoT device is not even the device you think it is, somebody might have replaced it. That's where you begin to be able to see the communications and so on from that. So security is key. Interconnectivity is key. And you know, when we speak about IoT itself, I've got a kind of a dual role at VMware. While I'm the CEO of VMware, I also focus on IoT for Dell Technologies. And when we look at that, today many of the examples of IoT are very narrow, almost point solutions. The real power will come when you begin to combine across those solutions. The thing that tells you the weather, the things that tells you the traffic and then the thing that tells you what's the best way to get there in your car or whatever it is. Combine those things. Now you've got to secure all that because you're sharing information. It's super exciting. It's probably a great, best time to be in doing R&D because Dave and Volante and I always talk about it on theCUBE all the time that if everything is cloud operations because everything, the confluence is happening. What is IoT? You have a thin edge. Could be a wind farm, traffic signal, sensor network or it could be a data center. The data center could be an edge. I mean, he could look at it anyway. It depends how you look at it. One of the biggest questions that comes up all the time is what exactly is the edge, right? And I think it means different things to different industries. It's very clear on the extreme edge. That's the device. It's a wind farm. It's measuring the behavior of a robot or something like that. And it's very clear on the other side. That's a cloud. I run a bunch of analytics over there. It's the interesting piece in the middle where there's both a lot of opportunity and a lot of even difficulty defining it. Is the SD-WAN server inside in an office? Is that edge? Yeah, that looks like edge. It's at the edge of the network but it's not controlling something physical. But that SD-WAN server inside in a retail store may well also be doing something but the refrigerators or the cold chain or something in that store. And now you begin to see it more as kind of an IoT device. It's awesome. It's great conversation and certainly fodder for more R&D and more innovation and the management side's key. And again, the holy grail and all this is programmable networks, right? Come on, we've been waiting. How fast is that coming? Pedal harder, come on. I know you've got to go. Thanks for coming on. But I do want to ask you guys are, we'll give you some props and just get your thoughts on obviously blockchain. We see things like Filecoin had a very huge ICO on the hype side. But they really have a product but they're promising. They store using decentralized and with blockchain. Obviously it's a network storage infrastructure. It's not so much selling tokens with token economics although it does have a piece of it. That's going to impact you guys on the horizon. What's the current state of you guys view, your view, the team's view of blockchain? Blockchain? Yeah, I mean, obviously there's a lot of the hype and even some of the valuations and things you see are tied to what's happening on the financial side, Bitcoin and so on. We're not focused on that at all. What we're saying is blockchain or more specifically a distributed hyperledger forms the basis of a community of companies or organizations being able to essentially look at trust as a service. I've got a contract with you. We're now able to look across a group of companies to say we all agree that contract is valid because of our leverage of this blockchain. That is a, that then becomes an application story. How do I run it more efficiently? How do I make sure I run it securely? How do I make sure that that community is able to leverage that service in a shared fashion? And that's what we're focused on. In fact, one of the more interesting things is when you look at things like blockchain, when it's used in the context of something like Bitcoin, there's a degree what people value is a non anonymity. We don't know who bought it, but somebody bought it. But when you look from a trust point of view, we actually want to be able to see who exactly did the contract. I agree that you've put the contract, we've worked this contract together and we're all agreeing with that. So you see these changes when you begin to bring these technology into enterprise. Efficiencies come correct on supply chain. Exactly. Actually, we've put a lot of focus on efficiencies. We've got a research team whose job has been very focused on given blockchain, how do I improve the core algorithms? How do I make them more applicable to something if we run by a typical enterprise or by a group of enterprises? And that's a little bit unusual for us because we're entering a kind of an application space. But what's good about this application space, it is hard systems engineering and that's what we know how to do. And that's why we think this is a great application space for us to be able to deliver real value. And the key word is engineering. You also mentioned earlier, community. Open source has brought this community dynamic together where there's no middlemen. This is the beautiful thing of the future of infrastructure. How do you manage it? How do you make it secure? Trust is a service. You guys are doing a great job. Based on our data, on the ecosystem, you guys have all the waves covered. Ray, thanks for coming on. I really appreciate your conversation. I'm John Furrier here in San Francisco for VMware's Radio 2018, 14th year of their annual engineering kickoff, motivation, hardcore engineering critique and also collaboration with the Sparks of Innovation are happening. We'll be right back with more. Thanks for watching.