 Live from the Sands Convention Center, Las Vegas, Nevada, extracting the signal from the noise. It's theCUBE, covering HP Discover 2015, brought to you by HP. And now your hosts, Dave Vellante and Jeff Frick. Welcome back to HP Discover, everybody. This is Dave Vellante with Jeff Frick, and we're here live. This is our second day at HP Discover. Check out hpdiscover.social. It's our new social digital experience. Alan Andreoli is here. He's the Senior Vice President and General Manager of HP's server organization. Great to see you again, Alan. Thanks for coming on us. Great to see you, Dave. Hello, Jeff. How are you today? So things are good in serverland. Unbelievable snapback in the ISS business. You guys got a good spring in your step. And so how do you feel? Transformation of HP, HP Enterprise, Hewlett Packard Enterprise? Things are good. Yeah, we should not rest on our laurels. The server's business has been doing well for the last three quarters, in particular the last three quarters. We had 17% growth in local currency last quarter, 11% in dollars. So we've been doing very well and we are very, very happy to be one of the key components of the turnaround of HP as a whole and HP Enterprise now moving forward. Yeah, that's your wheelhouse, obviously. So what do you attribute to that sort of snapback? I mean, you got Gen 9 product cycle. You got Windows server refresh cycle. Are those big factors? We've got Gen 9. So Gen 9, we are the more advanced in the shift generation to generation from Gen 8 to Gen 9. We passed a 50% line several weeks ago. The industry is not yet at 50%. So we know from the various sources that we are ahead. Our engineering team has done an exceptional job for Gen 9. We have a lot of traction with our new strategy, which I may talk about later on if you wish, but we have really organized by product category and now by market segments and we basically moving from doing only the core generic server business to now go for business outcomes and for HPC and we talk about that. These edge service providers, HPC, Mission Critical is giving us a lot of additional growth. Therefore we're growing faster than the market and certainly much faster than the traditional enterprise market. So talk more about the new strategy and if you could add some color to that. Yeah, so for many years, we've been the first X86 vendor. We kind of created this market. For many years, it was about running SAP, running CRM, running the classic enterprise types and have a good generic workforce to do that. So we generated the ProLiant server line, which is best quality, resiliency, performance and so on. But what we've seen over time is that the market is going through a revolution with mobile, creating big data, creating the cloud, creating security concern and many companies are reinventing themselves and compute, IT is becoming their core competency. And it means that one size doesn't fit all. We had to invent new server optimized for workloads. And so our strategy is to go for all these adjacent markets and segment the market accordingly. So we have the classic enterprise, which obviously is the majority of our business and we are doing very well with Gen9. We have the SMB market, which is going to an older beginning because now SMBs have choice between staying on-premise or going on the public cloud. So we need to be very appealing to them in terms of cost and in terms of unique appliances for the future that will do everything in one form factor. Then mission critical used to be for the big unique workloads, right? Now it's going x86, it's going Linux. We have launched SuperDomeX. In a few weeks, we have won several hundreds of customers. So this is going very, very well. Then HPC and big data. We have created an all new line called Apollo and you may remember we spoke like a year ago, we were launching Apollo the first, the big, the huge supercomputer with water cooling and so on. Then we cascade the product line. We now have the 6000, the 4000, the 2000 and this is growing like very, very fast. Yeah, we cover the reveal. That's right. You did, right? So it was the tip of the spear. We started on the very high end and now we cascade it into basically a complete product line for the hyperscale market. Next generation of workloads, we were very innovative with Moonshot. And Moonshot has now found its natural growth into three vertical markets, video encoding, which is very fast growing as you guys know. And so we're working with a number of ISVs in this market making Moonshot kind of the de facto standard for that market, working very closely with Citrix for the remote workplace, which as people are more and more on the move, is a very fast growing market and also solutions based on big data for Moonshot. And finally, for cloud providers, we are doing a great job with our John Ventures Foxconn to do unique open standard bare iron as some people call it, OCP platforms for the service provider market, which is our fastest growing market at this point in time. And finally, as the market moves to the internet of the things, more and more computers are being embedded in solutions. Solutions for medical, solutions for telcos, solutions for transportation, solutions for the industry and our OAM business, which is us offering platforms for the OEMs to integrate the complex systems is becoming more and more prevalent and we're investing a lot in that. That's our strategy. Yeah, so really dramatically changing the way that you think about R&D, segmentation at the market, how you optimize products for those different markets. Each segment is led by a GM. The GM has got, he or she has got her own R&D, her own marketing, the target set of customers and workloads and owns a PNL and therefore has the full, you know, the full drive of these very, and these allows us to have the broadest product line on the market, but at the same time to come as one face to a segment of customers because we have positioned our products, especially for them, for their business needs and for their business outcomes. It's interesting hearing you talk about Moonshot. We covered the original Moonshot announcement too. It was, you know, way ahead of its time and we said at the time, perfect system for Hadoop being able to scale, compute, independent of storage, for example, and that's got to be a great use case. Yeah, and so we have fantastic solutions for Hadoop. Moonshot on the front end and we can have a product called the Apollo 4000 in the back end, but we are now developing server-based storage, very broadly in partnership with HP Storage. So we have some ISVs like Cloversafe and Scality with whom we work very closely and we kind of jointly go into market and now we're developing a broad portfolio of server-based storage, which allows to run Hadoop and, you know, applications that come on top of Hadoop very efficiently. It's one of our fastest growing segment. Yeah, and it's interesting, we had talked about this last time. The conventional wisdom was that the hyperscale market was going to go to the ODMs and HP said, no, we're going to fight for that business. So I wonder if you could talk about that a little bit. You mentioned hyperscale, you're selling to service providers, that's both area for you. How could we have 17% growth if we were not a DM ourselves, right? So we have watched the market, where the market is going and do our very best to morph ourselves into an ODM when the customers want absolute commoditization. Yes. And when the customers value performance differentiation, then we've built Apollo product line, which basically has a different performance level than what anybody else can do because it's purely designed for performance. And you've got a relationship with Foxconn, right? For the cloud line, which is the service provider, ODM-like offering, and this business has been growing very fast since we last talked and we launched at the OCP submits in San Jose in March, our catalog product line, cloud line catalog, which is now starting to grow very well, very nicely. So OCP is interesting, are you at OCP? Yeah, we were there. Yeah, we were there. Did you see us on stage with a baby for fuming an eye giving birth to a new baby? I did not see the baby, we were doing key interviews. We didn't make it over to the stage, but it's an interesting pair. Wow, so the whole concept, I didn't make it this year, I was there last year, but the whole concept of open platforms like that, obviously the HP embraces openness. Where do you see that whole OCP trend going? So it's a segment, there is a segment of the market where it belongs, that's how we are looking at it, which has service providers. So we've designed these architecture for together with Foxconn, and with feedback from customers for service providers. That's number one. Then there are adjacencies, which are some enterprise customers, which we call enterprise service providers, who have a big cloud in-house and look at this type of architecture to port in their own data center. This is the case in the telco segment, in the financial services segment, for instance, in the retail segment, where there are some customers looking at the portability of such architectures in their own data center. And we are supporting this as well. We are supporting this totally open architecture. We're also supporting Microsoft WCS, but customers should not be confused with what we do on the ProLiant side. It's not for everybody, it's a different type of business model, and we are supporting both, but customers should not be confused about using a pure enterprise architecture, such as ProLiant, Apollo, RAG, Towers, Blades, and using Cloudline, which is really an ODM place. So you are more on your own, you have some cost benefits, but you've got to go the extra mile for the manageability of this architecture. It sounds like your R&D focus has really been sharpened over the last couple of years, and I've always said, for years, HP's got to get back to its roots and events. It sounds like you're doing that in your group. We're doing a lot of innovation where customers want innovation and differentiation, and when customers want commoditization, we're doing this as well, because we are the market, I mean, one server out of three is an HP server in all the market compounded, and therefore we've got to go to places where the customers need to go so that we continue to maintain this leadership, and to defend our scale as well. Yes, right, and then of course you've got this whole convergence trend going on. Maybe talk about that angle a little bit. Right, and so that's another angle, it's more in the enterprise, and so customers have got the option of being the assembler of the best of breed, which may come from HP or others, depending on whether this is compute or storage or networking and so on, or they may have the capability of using something that has been pre-configured, composed basically, from an architecture that is modular, and that's what we are doing in the converged system group, and soon we will be announcing a new architecture which we think is going to take the market by storm. Excellent, I'm sorry, we're getting the high sign, I don't know if you have to go, get ready for the keynotes I guess. In case you forget me until last time, I am from HP, and my name is Bella. Oh, there you go. We had some fun in our keynotes today. We each had a letter behind us, and so I have a C, the first letter for compute, and we had the six other GMs presenting with compute in the back. That's terrific. Having some fun here. Thank you. Thank you. Thanks very much for coming to theCUBE. It was great to see you again, and congratulations on the recent success and good continued tailwinds, we wish you. So thank you. Thank you. All right, keep it right there, everybody. We'll be back with our next guest right after this word.