 Another special guest, Jason Mendenhall, executive vice-president of Switch. This is a Las Vegas story in bandwidth. So it's going to be a fun one. Dave Vellante is going to kick it off and do the interview. Las Vegas in bandwidth, that's just, you know. Yeah, so it's unbelievable. So tell us a little bit about Switch and then we'll find out like why Las Vegas. Well Switch is the creator of the Supernav, the world's most powerful data center. When we built the facilities, our CEO, Rob Roy, he set out to create a unique environment. Really all about high efficiency, ultra-scale, high density data centers that are connected like no other on the planet. So tell us how you ended up in Las Vegas. That's not the place you typically think of a data center and a technology center. Well you know, there's a lot of reasons why we ended up in Vegas, but one of the main reasons was for its disaster avoidance area. When you really look at the United States and you kind of cut it up, you take the pieces of the United States and you say, all right, I got these kind of critical issues going on here, these kind of critical issues going on here, earthquakes, tornadoes, tsunamis. The list goes on. It turns out Vegas is one of the only few places in the United States, one of the only few metropolitan area markets that has zero issues related to that type of disaster avoidance. And so Las Vegas became a very natural place for us to build a Supernav where we're housing some of the largest customers infrastructure. So tell us a little bit more about Supernav, if you would. The Supernav's a 407,000 square foot data center. We've got over 100 megawatts of power committed to the facility. Now a lot of people kind of, we talk about 100 megawatts and we talk about it very loosely. But yeah, but it's a lot of power. It's a lot of power. Yeah, if you take a very dense metropolitan area and you cut about a two square mile out of it, like LA or even San Francisco, that's about 10 megawatts. So like in Vegas, we don't do anything small. We built the Supernav to be the world's most efficient high density data center. With all of that power, we've created a unique power delivery and power cooling system where we can offer data center co-location services that get up to 17.2 kilowatts per cabinet. Which is really unparalleled in the industry because it's about power. One thing to have the power, it's another thing to be able to cool it. And with our patented designs, we're able to manage the heat and the cold and the power and deliver 100% uptime availability to our customers. Really? So, you know, Lake Mead we hear is drying up, so is that an issue for you guys? No, it's not. Rob Roy, our CEO, when he was building the Supernav, he sought to deliver this high density environment. And the big issue that he came up with was how am I going to cool this? And there were really only several methods that you can use when you cool something. You can use direct exchange, indirect evaporative, direct evaporative or chilled water. And what he'd patented was a unique air handling device that incorporates all four types of cooling. Those devices are embedded with a computer system and also a mechanism by which it can detect the weather and choose the most appropriate method of cooling at that time. Now one of our cooling methods, direct exchange, works like the refrigerant in your car or like the air conditioner in your car, it's a refrigerant-based cooling method, it's totally water-independent. So the Supernav can operate without any need for water as a result of this cooling method. So what are you doing from a server standpoint, using like Google, using a lot of white box stuff that you've added value to or is it your own design? Well we break it up into several areas of our business. So one is the Supernav, the data center, where we've built this world-class operations. It's commercially available. Other customers can come in and bring their compute. They can put their servers in there. And then what we've added to that is our own inter-cloud exchange, the first of its kind, the United States inter-cloud exchange, where we've brought all of the top hardware providers into one location where they can actually, all of our customers, can have a private public cloud environment and use any type of virtualization platform that's available out there on the market today. So some of it's ours, some of it's our providers and some of it's our partners. But with all of that we've created this unique place where customers can get all of these solutions intelligently integrated into one place. So I've heard that you guys can actually sell at lower than wholesale prices, right? Yeah. Is that true? It is true. Particularly where we help people with their total cost of ownership is all of these solutions together. And the third piece of that puzzle, so we talked about co-location, we talked about compute and inter-cloud exchange. The third piece is connectivity. So back in the day, late 90s, early 2000, a little company called Enron, I think everybody remembers them, they were looking to build a broadband arbitrage center. And their goal was they were going to arbitrage bandwidth, just like they were arbitraging power back in the day. They got ready to build this and there was a little announcement that went out, Enron broadband services, pumped their stock up, everybody was very excited about it, lots of good, yeah, exactly. And about a week before they were ready to open that facility, they declared bankruptcy. And prior to that, they had paid billions of dollars to have all of these fiber providers string connectivity into this one facility in Las Vegas. They chose Las Vegas for the same reasons that we talked about earlier. So they brought in all this fiber connectivity. Our CEO, Rob Roy, was across the street, our founder. He saw this happening, watched it, talked to the guys, spent the next nine months pulling that facility out of Enron's bankruptcy. So that facility is now Switch's assets and it represents a fiber connectivity hub, unlike any other in the world. We think that the only thing close to it, at least our insurance companies tell us, the only thing close to it is probably the Amsterdam Internet exchange and that was funded by government. So with that buying power, we're able to lower the total cost of ownership for our customers who come into there. So when did you pick that asset up? What was the time frame? You know, I don't know the exact date. Was it after the dot-com bubble burst? Yeah, well it was during, it was, yeah, it was after the bubble burst, definitely. Okay, so you picked it up at a nice value? Well, in Enron's bankruptcy. So now you're executing on the vision that was Enron? Yeah, absolutely. Well, and it's not just that, here's what it really does for our customers. So our customers that come to the facility, a data center is nothing unless you can connect to it and compute to it. And with that telecommunications hub, what we've created is a combined ordering retail ecosystem. So our customers who come with all of these 27 on-net carriers, they're not strapped and shackled by that one carrier that they're used to dealing with. We can negotiate on their behalf and we use the buying power of all of our customers to deliver the best total cost of ownership to them. Because here's the bad news. So if you're with AT&T or level three of Verizon, love the guys. But guess what, if you ask them a question, the right answer is always level three or AT&T or Verizon. With the carrier network that we've built, we can deliver the highest value to our customers because we can mix and match the right solutions to deliver them the best thing for connecting into the data center. I thought the internet was about cutting out the middleman. No, no, no, it's not about, not at our place because here's the thing. We deliver those solutions. We deliver that connectivity. We deliver those telecommunications infrastructures. And you can do it through us or you can do it directly with them. It doesn't matter. We are truly a carrier neutral facility. And so if you need our help, we're there to help you. If you don't need our help, we'll help you negotiate with the carriers the best price that you've ever had. And we're negotiating best prices for the largest companies in the world. So customers love that. You've got a lot of credibility with it. Absolutely, absolutely. They love it. You're an independent advisor. So talk a little bit, we're here at VMworld. So let's talk a little bit about virtualization in the cloud. What are you doing there? And how much your infrastructure is virtualized? Maybe take us on your journey. So we saw the needs of our customers. And our customers came to us and said, you know, I'm coming to your data center. I'm putting these private cloud environments. I'm virtualized. One day, my virtualized infrastructure is going to run out. I need a burst-ready platform that I can get to. And so when we looked at that and we kind of examined how things were going to go, we said, all right, that means we've got to create something for everyone. And what we sought out to do was create the first of its kind, the United States Inter-Cloud Exchange. And SwitchCloud has that there. And what we've done is brought all of the top cloud carriers, the providers, into the data center. So no matter what type of platform you have, whether it's VMware or you're using some other hypervisor, you develop on the LAMP stack, you like Linux environments, maybe you're working with Node.js, maybe you need EMC storage, you need high availability of those types of things. We've brought all of those providers into one facility. And so you can easily access those virtualized environments simply with a cross-connect. With VMware, what we've done is we've brought in Cisco and EMC and VMware, and we've brought in a VBlock2 Max, the first of its kind for service providers. And with that VBlock2 Max, we've got the EMC, VMware, Cisco UCS compute framework reference architecture. So our customers who buy into that architecture can easily get to our burst-ready platform with unparalleled cost, because they're not connecting out to the internet. They're connecting directly in the data center. So we've talked to some customers in the Wikibon community, and a number of them actually architected their own VBlock. Would you have had to do something like that yourself in your view? No, we've really tried to stay with the standard, because one of the benefits of the VBlock2 Max architecture is it's predictable, it's referenced, it's standardized. And since what we're trying to create is an environment for customers that they can predict what it's going to be, we had to follow that. We decided to follow that reference architecture and be certified, have all of the approval of EMC, of VMware, and Cisco. They've touched it, they've blessed it. They've said, yes, this is a VBlock2 Max. Shearing the risk. Yeah, exactly, and so what's happening now is our customers who look at that, they know that they can get there very easily. They don't have to spend a lot of time trying to test against it. There's a lot of publications about this reference architecture, they know what they can predict, they know what they can do to get there, and we make it easy for them. Yeah, so now, obviously VMware in your environment, other hypervisors? Yeah, yeah, we've got, so we also have Joant, which is a public cloud provider in there, local here in San Francisco. We also have, we're in conversations with other hypervisor providers. Few of them I can't talk about right now, but it's the usual suspects. It's all the folks that you would expect. But what we're in the middle of doing, and what's happening, is that we're creating a universal environment no matter what your compute infrastructure is. We have a solution for you. It's there. It is there provided by any one of these providers, no matter what you're running on. So I want to talk about the difference between, can I call you a cloud service provider, or is that the character of the terminology you do? So a cloud service provider like yourself and big IT. Okay, and there seem to be some pretty stark differences, at least today. Can you talk a little bit about those? Like, how are you different from big IT and do you see that converging at all? Well, I think one of the unique things we do is we bring all of the important solutions together in one place. We work with some of the largest IT organizations on the planet, and when we talk to them, we've got a data center guy who comes and talk to us. Then we have a telecommunications guy who comes and talks to us. Then we have a compute guy who comes and talks to us. The funny thing is, in almost no companies are these three guys talking together. No facilities guy. Yeah, yeah, yeah. So we found ourselves in this unique position. We are truly Switzerland, you know. We find ourselves in this unique position where we're helping them communicate in ways that they never have before. And so we view ourselves as facilitators for big IT to help them save money, no matter what they're doing. I don't think any large IT organization is going to be 100% on public cloud. They're going to have a private cloud environment. They're going to need a burst-ready platform. They're going to need connectivity to that infrastructure, and then they're going to need a place to put it. And with our data centers, they've got the best place to put it on earth. So that burst infrastructure that you're talking about is, in theory, anywhere, in one example of VMware to VMware first, right? Yeah, exactly. So having a similar infrastructure in the data center as you have in your hosting facility is a prerequisite, right? Not really a prerequisite, but it's available. And so you can use those environments. I've been in three of these sessions today already. And everyone is talking about a federated instance, a way to move from one place to another, and how, before you move to one place, you've got to spend time justifying the provider's architecture by adopting these standards and having every platform available to you, no matter what you're using. It makes it easy for you to start to use these burst-ready platforms. Where before, and even right now, it's very difficult for IT organizations to buy into that, particularly when you don't know where it's going to be. Right, and whereas you can monetize that and you're transaction-oriented, so it's true, a lot of the CIOs that we talk to are saying we want to reduce the number of vendors that we have, we want to really create more homogeneity where two heterogeneous, I'm not hearing that from you. Well, we're okay with diversity, and we'll provide that. It's there for you, but if you're looking to figure out how to get there, we're the best place. I talk to a lot of customers about, and they keep going, how am I going to get to the cloud? Where am I going to go? And I said, well, step one is get in the data center. Well, I am not virtualized yet, and I'll just put your gear in the data center. Now, I've got a VMware platform for you. I have a Linux platform for you. I have an Amazon-like platform for you. I have a storage platform for you, and you can pay for those by the drink while you figure it out right in the data center. And as you figure it out, I've got a great platform for you to be on, and I've also got the best data center in the world for you to be in. So you know where that stuff is, and you know that it's in the most secure facility out there. Yeah, so, and I've seen pictures of your facility. It's pretty intense. It's good, yeah. I've been to a lot of data centers, and your facility doesn't look like most data centers that I've been in. Hey, I bring a lot of people through. I always start out everything and say, hey, it's the world's best data center. If at the end of our visit, you don't think so, let me know. Well, it's got to be a great selling point for you. Absolutely. So my point is that it's a weird dynamic for you because in a lot of ways, you're sort of quasi-competing with traditional IT. You know, you don't go out and market that. Yeah. But if I'm a CEO, I'm saying, well, why not just put the stuff into a cloud service provider like Switch? Why do I need to own it? Do it. If that's what your goal is, we just know that everybody has different capital requirements and different capabilities in regards to managing their cash. CFOs are dictating that a lot. The business model is dictating that a lot. Cloud isn't for every application for every instance. Look at the perfect example of an SAP provider, or someone who's got SAP running in their environment. Monthend Close is a bear for them. They plan their infrastructure based on Monthend Close. So they go out and they buy all this stuff to handle those three days or a week when everyone's pounding at the system. Tell you what, why don't you scale that back a bit, buy for your normal operating procedures, and then burst your Monthend Close into our cloud environment on an infrastructure that's predictable and you know. And that's where the private public cloud story starts to come together. And I think that's where large enterprises are going to go. So you have customers doing that today. Talk a little bit about the dynamics of doing that. What do they have to do to actually take advantage of that? Is it like Amazon, turn it on, turn it down easy, or is it something they have to plan for and sign up for a little bit in advance or somewhere in between? Here, I'm going to give you the super technical question. It depends, right? Yeah, it really depends on what platform you're looking to go to and what you're looking to use. The Amazon, that Linux type, that open source sort of platform, that usually is easily burstable and easily get in there. VMware instances get a little more dicey. You're dealing with Windows, you're dealing with Windows Server, maybe you're dealing with a different OS as well. But the good news is you know that the infrastructure is federated and it's referenced and it's something you can predict so you can test it before you get there. So as a customer, what do I need to commit to from you to help me with that month end so that I'm not spending for 27 days a peak infrastructure that I only need for three days? Tell me what you need. Hey, you're probably already running a virtualized environment and you know what that is. And so you say, all right, I need 100 instances of this over these four days. We'll plan it and block it off for you and we'll charge accordingly. Okay, so it's really just do a little planning and some hand holding. Yeah, and here's the best part. Whether you're in the data center or out, our connectivity infrastructure will always deliver the lowest total cost. I can get you point to point circuits that'll save you 45% on whatever you're paying right now. So you're operationally, you're going to be better than 99% of the shops that are out there. Lower power, you've got the patented cooling technology and lower risk for a long time. Absolutely, absolutely. Can you talk a little bit about security? I mean, that's got to come up a lot. Yeah, so we, visit our facility. Yeah, okay, so not the physical security. Yeah, physical security is definitely there. Without a doubt. And I think that's an important piece because cloud providers right now, in many cases, they're moving your stuff around the globe and you don't know where it's going. The fact that you know where it is in our facility and that it's in the most secure, most protected physical facility, you visit our facility and you see that. We house some of the most top government installations out there and we've had to develop a security model and 100% uptime model to provide services to them. Now go to the network security in those pieces. Because we standardize on referenced architectures, we know that I've got the resources of Intel, Cisco and EMC and VMware. All of their top engineers are looking at what we're doing making sure it's working effectively and it's the most secure environment. If we ever see a problem, hey, it's their names on it. And you look at our intercloud exchange, it's got all the top logos there. Their names are on it, they care about it, they want to make sure it's available because they're talking about it as well. It's great, okay, so we're talking to Jason Mendenhall of Switch. Really interesting story, Jason. Really appreciate you stopping by the Cube and sharing the experience with us. Yeah, absolutely, anytime. Okay, next up on the Cube is Charlotte Yarkini. She's going to be coming in and talking about EMC and Mosey and Cloud Service Provider and they happen to be in your facility. They are. In Amsterdam and Vegas. Just, yeah, absolutely. Okay, Jason, thanks so much for coming by. We'll bring Charlotte in, no break.