 Hey guys, welcome back to theCUBE's coverage of Ansible Fest 2022. This is day two of our wall-to-wall coverage. Lisa Martin here with John Furrier. John, we're seeing this world where companies are saying if we can't automate it, we need to. The automation market is transforming. There's been a lot of buzz about that. A lot of technical chops here at Ansible Fest. Yeah, I mean, we've got a great guest here coming on. CUBE alumni, Daniel Newman, Future Room. He travels every event. He's got his nose to the grindstone, here to the ground, great analysis. I mean, we're going to get into why it's important. How does Ansible fit into the big picture? It's a really great segment, the board do it. Well, John, just did my job for me. I'm going to introduce him again. Daniel Newman, one of our alumni, is a back principal analyst at Future Room Research. Great to have you back on theCUBE. Yeah, it's good to join you. Excited to be back in Chicago. I don't know if you guys knew this, but for 40 years, this was my hometown. Now, I don't necessarily brag about that anymore. I live in Austin now. I'm a proud Texan. But I did grow up here, actually, out in the West suburbs. I got off the plane. I felt the cold air and I almost turned around and said, does this thing go back? Yeah. I've grown thin skin. It did not take me long. I like the warm weather. Come on, come on. I'm the same. I'm from California and I got off the plane Monday. I went, whoa, I need a coat. And I was in Miami a week ago and it was 85. Oh, goodness. Crazy. So you just flew in, talk about what's going on, your take on Ansible. We talked a lot with the community, with partners, with customers. A lot of momentum, the flywheel of the community is going around and around and around. There's some of your perspectives that you see. Yeah, absolutely. Well, I'm going to take a quick step back. We're entering an era where companies are going to have to figure out how to do more with less. We've got exponential data growth. We've got more architectural complexity than ever before. Companies are trying to discern how to deal with many different environments. And just at a macro level, Red Hat is one of the companies that is almost certainly going to be part of this multi-cloud, hybrid cloud era. So that should initially give a lot of confidence to the buying group that are looking at how to automate their environments. You're automating workflows, but really with Ansible, we're focused on automating IT, automating the network. So as companies are kind of dig out, we're entering this recessionary period. We're going to call it what it is. The first thing that they're going to look at is, how do we tech our way out of it? I had a wonderful one-on-one conversation with ServiceNow CEO Bill McDermott, and we saw ServiceNow was in focus this morning in the initial opening session. This is the integration, right? Ansible integrating with ServiceNow. What we need to see is infrastructure, automation layers, and applications working in concert to basically enable enterprises to be up and running all the time. Let's first fix the problems that are most common. Let's automate them, let's script them, and then at some point, let's have them self-resolving, which we saw at the end with Project Wisdom. So as I see it, automation is that layer that enterprises, boards, technologists, all can agree upon are basically, here's something that can make our business more efficient, more profitable, and it's going to deal with this short-term, downturn, in a way that tech is actually going to be the answer, just like Bill and I said. Let's tech our way out of it. If you look at the red hat being bought by IBM, you see Project Wisdom, project, not a product, it's a project. Project Wisdom is the confluence of research and practitioners kind of coming together with AI. So bringing AI power to the Ansible is interesting. Red Hat, Linux, REL, OpenShift. I mean, Red Hat's kind of positioned, isn't it, to kind of be in that right spot where the puck might be coming, maybe? I mean, what do you think? Yeah, the analysts were really good at predicting the recent past. It's a joke I always like to make. But Red Hat's been building toward the future, I think, for some time. Project Wisdom, first of all, I was very encouraged with it. One of the things that many people in the market probably have commented on is, how close is IBM and Red Hat? Now, again, it's a $34 billion acquisition that was made, but boy, the culture of these two companies couldn't be more different. And of course, Red Hat kind of carries this sort of middle ground layer where they provide a lot of value and services to companies that maybe don't use IBM for the public cloud, especially. This was a great indication of how you can take the power of IBM's research, which, of course, has some of the world's most prolific data scientists, engineers building things for the future. You see things like, yesterday, they launched an AI solution. They're building chips, semiconductors, and technologies that are going to power the future. They're building quantum. Long story short, they have these really brilliant technologists here that could be adding value to Red Hat. And I don't know that the world has fully been able to appreciate that. So when they got on stage and they kind of say, here's how IBM is going to help power the next generation, I was immediately very encouraged by the fact that the two companies are starting to show signs of how they can collaborate to offer value to their customers, because of course, as John kind of started out with this question, is they've kind of been where the puck is going. Open source, Linux, hybrid cloud, this is the future. In the future, every company's multi-cloud, and I said in a one-on-one meeting this morning, every company is going to probably have workloads on every cloud, especially large enterprises. And I think that the secret's going to be, how do you make that evolve? And one of the things that's coming out of the industry over the years, and looking back at as historians, we would say, got to have standards. Well, with cloud now, people, standards might slow things down. So you're going to start to figure out how does the community and the developers are going to be the canary and the coal mine, and I'd love to get your reaction on that, because we've got KubeCon next week. You're seeing people kind of align and try to win the developers, which I always laugh, because they don't want to win. You want them on your team, but you don't want to win them. So developers will decide. Well, I think what's happening is there are multiple forces that are driving product adoption, and John, getting the developers to support the utilization and adoption of any sort of stack goes a long way. We've seen how sticky it can be, how sticky it is with many of the public cloud providers, how sticky it is with certain applications, and it's going to be sticky here in these interim layers, like open source, automation, and Red Hat does have a very compelling developer ecosystem. I mean, if you sat in the keynote this morning, I said, you know, if you're not a developer, some of this stuff would have been fairly difficult to understand, but as a developer, you saw them laughing at jokes, because you know, what was it the whole part about, you know, it didn't actually, the thing wasn't a success, right? And everybody started laughing, and I was sitting next to someone who wasn't technical, and you know, she kind of goes, what was so funny? And I'm like, well, he said it worked, and do you see that? It said zero data transferred or whatever that was. So, but if I may just really quickly, one other thing I did want to say about Project Wisdom, John, that the low code and no code to the full stack developer is a continuum that every technology company is going to have to think deeply about as we go to the future, because the people that tend to know the process that needs to be automated tend to not be able to code it. And so we've seen every automation company on the planet sort of figuring out and how to address this low code and no code environment. I think the power of this partnership between IBM Research and Red Hat is that they have an incredibly deep bench of capabilities to do things like self-training. Okay, you've got so much data, such significant sized models, and accuracy is a problem, but we need systems that can self-teach. They need to self-teach, self-learn, self-heal so that we can actually get to the crux of what automation is supposed to do for us and that's supposed to take the mundane out and enable those humans that know how to code to work on the really difficult and hard stuff because the automation's not going to replace any of that stuff anytime soon. So where do you think looking at the partnership and the evolution of it between IBM Research and Red Hat and you're saying they're finally getting this synergy together, how is it going to affect the future of automation and how is it poised to give them a competitive advantage in the market? Yeah, I think the future or the competitive space is that is ecosystems and integration. So yesterday you heard Red Hat Ansible focusing on a partnership with AWS. This week I was at Oracle Cloud World and they're talking about running their database in AWS. And so I'm kind of going around to get to the answer to your question, but I think collaboration is sort of the future of growth and innovation. You need multiple companies working towards the same goal to put gobs of resources. That's the technical term, gobs of resources towards doing really hard things. And so Ansible has been very successful in automating and securing and focusing on very certain specific workloads that need to be automated, but we need more. And there's going to be more data created, the proliferation, especially the edge. So you saw all the stuff about Rockwell. How do you really automate the edge at scale? You need large models that are able to look and consume a ton of data that are going to be continuously learning and then eventually they're going to be able to deliver value to these companies at scale. IBM plus Red Hat have really great resources to drive this kind of automation. Having said that, I see those partnerships with AWS, with Microsoft, with IBM, with ServiceNow. It's not one player coming to the table. It's a lot of players working together. They got to be Switzerland. They're the Switzerland. But the thing about the Amazon deal is that marketplace integration essentially puts Ansible, once the client's in on Marketplace and you get the central on the same bill, I mean, that's going to be a money maker for Ansible. I mean, they're going to be. I couldn't agree more, John. I think being part of these public cloud marketplaces is going to be so critical in having Ansible land and of course AWS largest public cloud by volume, largest marketplace today. And my opinion is that partnership will be extensible to the other public clouds over time. That just makes sense. And so you start, you know, I think we've learned this, John, you've done enough of these interviews that you know, you start with the biggest, with the highest distribution and probability rates, which in this case right now is AWS, but it'll land on Azure, it'll land in Google and it'll continue to grow. And that kind of adoption, streamlining, make it consumption, more consumable. That's always a thing. I think Red had an Ansible. You nailed it on that whole point about multi-cloud because what happens then is, why would I want to alienate a marketplace audience to use my product when it could span multiple environments, right? So you saw, you heard that Stephanie yesterday talk about, they didn't say multiple clouds, multiple environments. I think that is where I think I see this layer coming in because some companies just have to work on all clouds. It's the way it has to be. Why wouldn't you? Yeah, well every company will probably end up with some workloads in every cloud. I just think that is the fate. Whether it's how we consume our SaaS, which a lot of people don't think about, but it always tends to be running on another hyperscale public cloud. Most companies tend to be consuming some workloads from every cloud. It's not always direct. So they might have a single control plane that they tend to lead the way with, but that is only going to continue to change. And every public cloud company seems to be working on figuring out what their niche is. What is the one thing that sort of drives whether it is traditional, we know the commoditization of traditional storage network compute. So now you're seeing things like AI, things like automation, things like the edge, collaboration tools, software being put into the forefront because it's a different consumption model. It's a different margin and economic model. And then of course it gives competitive advantages. And we've seen that. I came back from Google Cloud Next and at Google Cloud Next you can see they're leaning into the data AI cloud. I mean that is their focus, like data AI. This is how we get people to come in and start using Google, who in most cases are probably using AWS or Microsoft today. That's a great specialty cloud right there. That's a big use case. I can run data on Google and run something on AWS. And then of course you've got all kinds of, and this is a little off topic, but you've got sovereignty, compliance, regulatory. That tends to drive different clouds or global clouds like Tencent and Alibaba. If your workloads are in China. Well this comes back down to at least the whole complexity issue. I mean, it has to get complex before it gets easier. And I think that's what we're seeing companies opportunities like Ansible to be like, okay, tame the complexity. Yeah. Yeah, I totally agree with you. I mean, look, when I was watching the demonstrations today, my take is there's so many kind of simple, repeatable and mundane tasks in everyday life that enterprises need to automate. Do that first. Then the second thing is working on how do you create self-healing, self-teaching, self-learning, you know, and I realize I'm a little broken of a broken record at this. But these are those first things to fix. You know, I know we want to jump to the future where we automate every task and we have multi-term conversational AI that is booking our calendars and driving our cars for us. But in the first place, we just need to say, hey, the network's down. Like let's make sure that we can quickly get access back to that network again. Let's make sure that we're able to reach our different zones and locations. Let's make sure that robotic arm is continually doing the thing it's supposed to be doing on the schedule that it's been committed to. That's first. And then we can get to some of these really intensive, deep, metaverse state of automation that we talk about, self-learning, data replications, synthetic data. I'm just going to throw terms around so I sound super smart. In your customer conversations though, from looking at the automation journey, are you finding most of them or some percentage is wanting to go directly into those really complex projects rather than starting with the basics? I don't know that you're finding that the customers want to do that. I think it's the architecture that often ends up being a problem is we as the vendor side will tend to talk about the most complex problems that they're able to solve before companies have really started solving the immediate problems that are before that. You know, we talk about, the metaphor of the cloud is a great one, but we talk about the cloud like it's ubiquitous. But less than 30% of our workloads are in the public cloud. Automation is still in very early days, and in many industries it's fairly nascent and doing things like self-healing networks is still something that hasn't even been able to be deployed on an enterprise-wide basis, let alone at the industrial layer, maybe at the company's unmanufacturing plans or in oil fields. These are places that have difficult to reach, infrastructure that needs to be running all the time. We need to build systems and leverage the power of automation to keep that stuff up and running. That's just business value, which by the way is what makes the world go round. Yeah, awesome. A lot of customers and users are struggling to find what's the value in automating certain processes? What's the ROI in it? How do you help them get there so that they understand how to start, but truly to make it a journey that is a success? ROI tends to be a little bit nebulous. It's one of those things I think a lot of analysts do things like TCO analysis is an ROI analysis. I think the businesses actually tend to know what the ROI is going to be because they can basically look at something like, when you have an MSA, here's the downtime, right? Business can typically tell you, I guarantee you Amazon can say look, for every second of downtime, this is how much commerce it costs us. A company can generally say if it was, we had the energy, the windmills company, like they can say every minute that windmill isn't running, we're creating X amount less energy. So there's a time value proposition that companies can determine. Now the question is about the deployment. I've seen it more nascent, like cybersecurity can tend to be nascent, like what does a breach cost us? Well, there's specific costs of actually getting the breach cured or paying for the cyber security services, and then there's the actual, ephemeral costs of brand damage and of risks and customer, negative customer sentiment that potentially comes out of it. With automation, I think it's actually pretty well understood. They can look at, hey, if we can do this many more cycles, if we can keep our uptime at this rate, if we can reduce specific workforce. And I'm always very careful about this because I don't believe automation is about replacement or displacement, but I do think it is about up-leveling and it is about helping people work on things that are complex problems that machines can't solve. Having said that, if you don't need to put as many bodies on something, that can be immediately returned to the organization's bottom line or those resources can be used or something more innovative. So all those things are pretty well understood. Getting the automation to full deployment at scale though, I think what often, it's not the ROI, it's the timeline that gets misunderstood. Like all IT projects, they tend to take longer and even when things are made really easy, like with what project wisdom is trying to do semantically enable through low code, no code and the ability to get more accuracy, it just never tends to happen quite as fast. So, but that's not an automation problem, that's just the crux of IT. Okay. What are some of the next things on your plate? You're quite a busy guy, you were at Google, you were at Oracle, you're here today, what are some of the next things that we can expect from Daniel Newman? Oh boy, I move really, I do move really quickly and thank you for that. Well, I'm very excited, I'm taking a couple of work personal days. I don't know if you're a fan, but F1 is this weekend, the U.S. Grand Prix. You're going to Austin? So I will be, I live in Austin. So I will be in Austin, I will be at the Grand Prix. It is work because you know, I'm going with a number of our clients that have sponsorships there. So I'll be spending time figuring out how the data that comes off of these really fun cars is meaningfully going to change the world. I'll actually be talking to Splunk's CEO at the race on Saturday morning. But yeah, I got a lot of great things. I got a conversation coming up with the CEO of Twilio next week. We got a huge week of earnings ahead. And so I do a lot of work on that. So I'll be on Bloomberg next week with Emily Chang talking about Microsoft and Google. Love talking to Emily, but just as much love being here on theCUBE with you guys. Well, we like to hear that. Who you rooting for, F1? Who's your favorite driver? I like Lando. Do you? I know it's not necessarily a fan favorite, but I'm a bit of a McLaren guy. I mean, obviously I have clients with Oracle and Red Bull, with Fall Common Ferrari. I've got clients Splunk and, so I have clients at all. So I'm cheering for all of them. And on Sunday, I'm actually going to be in the Williams paddock. So I don't know if that's going to give me a chance to really root for anything, but I'm always a big fan of the underdog. So maybe Latifi. There you go. And the data that comes off, how many stuff is on the car, it's crazy. It's such a scientific sport. Unbelievable. I was with Christian Horner yesterday, the team principal from Red Bull. He was at the Oracle event. We did a Q&A with him and with the CMO of, it's so much fun. F1 has been unbelievable to watch the momentum. And what a great transitional conversation to CX and automation of experiences for fans. Yes. The fan has grown by hundreds of percent, but just to circle back the full way, I was very encouraged with what I saw today. Red Hat, Ansible, IBM, strong partnership. I like what they're doing in their expanded ecosystem. And automation, by the way, is going to be one of the most robust investment areas over the next few years, even as other parts of tech continue to struggle, that in cybersecurity. You heard it here first guys, investment in automation and cybersecurity, straight from two analysts, I got to sit between. For our guests and John Furrier, I'm Lisa Martin. You're watching theCUBE live from Chicago, Ansible Fest 22. John and I will be back after a short break, so stick around.