 Live from Las Vegas, it's theCUBE! Covering AWS re-invent 2019. Brought to you by Amazon Web Services and Intel, along with its ecosystem partners. Hey, welcome back to theCUBE, Lisa Martin at AWS re-invent in Vegas, a very busy Sands Expo Center. Pleased to be joined by my co-host this afternoon, Justin Moran, the founder and chief analyst at Pivot9. Justin, we're hosting together again. We are, it's great to be here. It's great to have you back. So Justin and I are pleased to welcome a couple of our CUBE alum back to the program, a couple guys from NetApp. We have Anthony Lai, the SVP and GM of the cloud business unit. Welcome back, Anthony. Thank you very much, great to be here. And color coordinating with the Anthony's, Yonzey Stephenson, NetApp's chief technology officer and VP of cloud, welcome back. Thank you, thank you. Very sharply dressed guys, I'm very impressed. Thank you, thank you. It's, you know, the good news is there's no suits anymore. So we don't have to wear ties. A little more comfortable. So guys, NetApp, AWS, this event, even bigger than last year, which can't even believe that, 65,000 or so folks. But Anthony, let's start with you. Talk to us about what's new with the NetApp, AWS partnership and a little bit about the evolution of it. Yeah, I mean, you know, we started on AWS. Oh my gosh, must be almost five or six years ago now. And we made a conscious effort to port our operating system to AWS, which was no small task. And it's taken us a few years, but we're really starting to hit our stride now. We've been very successful. We're onboarding customers at an ever-increasing rate. We've added more services. And we just continue to love the cloud as a platform for development. We can go so fast. And we can do things in an environment like AWS that frankly you just couldn't do on-premise. You know, the complexity and heterogeneity of on-premise was always a challenge. The cloud for us is an amazing platform where we can go very, very fast. And from a customer demand standpoint, Yanzi talked to me about that as chief technologist. One of the interesting things that Andy Jassy shared yesterday was, and it surprised me, 97% of IT spend is still on-prem. So we know that regardless of the M word, the multi-cloud word, customers are living in that multi-cloud world. Whether it's by strategy, a lot of it's not, a lot of it's inherited, right? They have to have that choice, right? It's going to depend on the data, the workloads, et cetera. What can you tell us about when you're talking with customers, how are they driving NetApp's evolution of its partnership with public cloud provider AWS? So I actually, I don't know if it's the desired state to be running in a hybrid multi-cloud fashion, but it's driven by strategy. And it's usually driven by specific workloads and finding the best home for your application or for your workload at any given time. Because it's ultimately unrealistic for on-premise customers to try to compete with the machine and deep learning algorithms and the rate of development and rate of basically evolution in the cloud. So you always have to be able to stay competitive. So it's becoming a part of the strategy even though it was probably us, the developers that drove a lot of cloud adoption to begin with. Maybe not in favor of the CIO or you had a lot of cloud sprawling, but there's no longer sprawling. It's part of the strategy for every company in my opinion. We heard from Andy Jassy in the keynote yesterday about the transformation being an important thing. And he also highlighted a lot of enterprise and NetApp has a long history with enterprise. Very solid reputation with enterprise. So it feels to me like this is an enterprise show now that the enterprise has really arrived with the cloud. So what are you seeing from the customers that you've already had for a long time who had no NetApp familiar with it, trust NetApp, who are now exploring the cloud and doing more than just dipping their toe in the water. What are they actually doing with the cloud and with NetApp together? You know, we see an ever-growing list of workloads. I think when people make decisions in the cloud, they're not making those traditional horizontal decisions anymore. They're making workload by workload by workload decisions. And NetApp's history and I think performance on-premise has given customers peace of mind now in the cloud. They sort of know that what's been highly reliable, highly scalable for them on-premise, they can now have that same confidence in the cloud. So we started like just like Amazon, we started off seeing secondary workloads like DR, backup, DevOps. But now we're seeing big primaries go. SAP, big database workloads, e-commerce, a lot of HPC, high-performance computer. We're doing very well in oil and gas, in the pharmaceutical industries, where file has been really lacking on the public cloud. I think we leaned in as a company years ago and put a concerted effort to make it there. And I think now the workloads are confident that we're there and we can give them the throughput, we can give them the performance on the protocols. And now we're seeing big, big workloads come over to the public clouds. Andy did make a big deal about transformation being important and a lot of that was around the operational model, less of just the pure technology but a lot about the operating model. So how are you seeing enterprises transform? There's a lot who've traditionally just sort of taken a workload, do a bit of lift and shift and put it to the cloud. Are they now transforming the way they actually operate things because of cloud? Absolutely, I mean they have to. They have to adopt new technologies and new ways of doing business. So I mean I think they are actually celebrating that. And to Anthony's point, I think with the NAHDA partnership and we are partnering with, we have a very unique story. We are partnering with all of them and have really deep engineering relationship with all of them. And they are now able to go after enterprise type workloads that they haven't been able to go after before. So that's why it's such a strategic relationship that we have with all of them. And that sort of brings in the freedom of choice. You can basically go everywhere, anywhere. And that in my opinion is the true hybrid cloud story. Data has always been really difficult but with the data management capabilities of NetApp, it's really easy to move, migrate, replicate, across on-premise to a hyperscaler of choice. I mean I think if you're an enterprise right now, you're a CEO, you're probably scared to death of like being ubered, you know? Exactly. So speed has now become what we say the new scale. It used to be scaled as your advantage and now if you're not fast, you could be killed any day by some of these startups who just build a mobile app and all of a sudden they've gotten between you and the customer and you've lost. And I think CEOs are now, how fast are we going? How many application developers do we have? How many data scientists do we have? And because of that, they're seeing Amazon as a platform for speed. And so that's just that paranoia I think with digital transformation is driving everybody to the cloud. You're right, if we look at transformation, if a business and Andy Jassy and John Furrier talked about this in that exclusive interview that they did the other day, and Andy, if you're a legacy enterprise and you're looking at your existing market share segment, and you're not thinking there's somebody else, what's the thing on the side mirror, objects in the mirror, close to the main mirror, not getting ready for that, you're going to be on the wrong side of that equation. But if we look at cloud, it has had an impact on traditional storage. For sure, for sure. One of NetApp's taglines is data driven. If we look at transformation, and if we even look at the transformation of cloud in and of itself, data is at the heart of everything. Yes. And they talked to us about NetApp's transformation as cloud is something that you're enabling on-prem, hybrid, multi-cloud as you talked about. But how is your advantage allowing customers to not only be data driven, but to find value in that data that gives them that differentiation that they need for the guy or a girl that's right behind them, ready to take over? Well, I think if you're an enterprise, you know, the one asset you have is data. You have history. Now it's a liability, now it's an asset. Can they do anything with it? Do they know where it is? Do they know how to use it? Where it should be, you know, is it secured, is it protected? All of those things, it's very hard for an enterprise to answer those questions. What NetApp I think has done incredibly well is by leaning in as much as we did onto AWS, we gave our customers the absolute choice to leave our on-premise business. And a lot of people I think years ago thought we were crazy. But because now we've expanded our footprint to allow customers to run anywhere without any fear of lock-in, people are starting to see us now not as a storage vendor, but as a strategic partner. And that strategic partnership has really come about because of our willingness to let people move the data and manage the data wherever they need it to be. And that's something our customers have said, you know, you used to be a storage vendor, and along with the other storage vendors, and now all of a sudden we're having conversations with you about strategy, where the data should be, you know, who's using it, is it secured, all of those kinds of conversations we're now having with customers. Yeah, you mentioned moving data, and that was something that, again, came up in the keynote yesterday. Andy mentioned that, hey, maybe instead of taking the data to the compute, we should bring the compute to the data. So, I mean, that's something that NetApp has long actually talked about. I remember when you used to mention data fabric was something about we want to take your data and then make it available to where the compute is. And I'd like you to talk to you that, particularly in light of like AI and ML, which is on the tip of everybody's tongue, it's a bit of a, I think it's possibly reaching the peak of the hype cycle at the moment. So, what are customers actually doing with their data to actually analyze it? Are they actually seeing real value for machine learning and AI, or are we still, is it just kicking the tires on that? Yeah, I mean, the biggest problem with deep learning and machine learning is having or accumulating enough data and being able to have the data or lessening the data gravity by being able to move it, then you can take advantage of SageMaker and AWS. Big query in Google, whatever fits your needs and then if you want to store the results back on premise, that's what we enable with the data fabric. Having that free flowing workload migration has to count for data. It's not enough to just move your application. The data is the key for machine learning and data lakes and others. Absolutely, yeah. In terms of speed, Anthony, you mentioned that, that's the new scale. How is Flash changing the game with respect to that? Flash is a media type, it's just the prices have come down now that the price performance curve for Flash is an obvious thing. And a lot of people are, I think, now making on-premise decisions to get rid of spinning disk and replace it with Flash because the ROI is so good. The TCO, the mean time between failures, this is so many advantages that for certain workloads, it's a better decision. Of course, AWS provides a whole bunch of media and again, it's just like a kid in a candy store. As a developer, you look at Amazon, you're like, oh my God, back in the day, we had to make an oracle decision and everything was oracle. And now you can just move things around and you can take advantage of all sorts of different utilities and now you piece together an application very differently. And so you're able to sort of really think, I think, to Yancy's point, people are telling us they have to have a data strategy. And then based on the data strategy, they will then leverage the right storage with the right protocols. They'll then bring that to compute whatever compute is necessary. I think data science is a little fashion, conscious right now. Everybody wants to say how many data scientists they have on their teams. They're looking for needles in haystacks. Some of them are finding them, some of them aren't. But not doing it, I think, makes companies very, very nervous. So even if they're getting the results, they're trying as hard as they can to leverage that technology. And Yancy, where is that data strategy conversation happening? If we think about the four essentials that Andy Jassy talked about yesterday for transformation, one of the first things he said was, it has to be a top, a senior level decision. And then it's going to be aggressively pushed down through the organization. Are you seeing this data strategy at the CEO level yet? Yeah, we are. But I'm also seeing it much lower. I mean, with the data engineers, with the developers, because it is extremely important to be developing on top of production data, specifically if you're doing machine and deep learning. So I think it's both. I think the decision authority has actually moved lower in the company where the developers or the site reliability engineers are actually choosing what technology to use that fits the product that they are actually creating. Of course, the strategy happens at the top, but the influencer and the decision makers, in my opinion, has been moving lower within the organization. So I'm basically contradicting what Yassy is saying, but to me, that is also important. The days of a CTO or a CEO forcing a specific platform or strategy onto developers, those days are hopefully gone. I think if you're a CEO of any company in any industry, you have to be a tech company. It used to be a tech industry, and now every company in the world is now tech. Everyone's building apps, everyone's using data, everybody's trying to figure out machine learning, and so I think what's happening is, CEOs are increasingly becoming technically literate. They have to. Exactly. They're dead if they're not. I mean, whether you're an insurance company, your primary platform is now digital. If you're a medical company, your primary platform is digital. So I think it was a great stat. I saw that about two and a half years ago, the number of software engineering jobs in non-tech surpassed the number of jobs in tech. Wow. So we used to have our little industry and all the software engineers came to work for tech companies. Now there are more jobs outside the tech segment for engineers than there are in the tech segment. Well, and you brought up Uber a minute ago, and I think of a couple of companies' examples, and my last question for you as we wrap is about industry, is that you look at Uber, for example. The fact that the taxicab companies were transitional and we're really eager to, you know, appify their organizations and meet the consumer demand, and then you look at Airbnb and how that's revolutionized hospitality or Peloton and how it's revolutionized fitness. Last question, Yonsei, let's go for you. Looking at all of the transformation that cloud has enabled and can enable, what industry, you mentioned oil and gas, but is there any industry that you see right now that is just at the tipping point to be able to blow the door wide open if they transform successfully? Well, I mean, we are working with a lot of pharma companies and genome sequencing companies that are actually working with sensitive data. And if those companies, I mean, these are people's medical histories and everything. So we're seeing them moving now in bulk loads into the cloud. So if those companies can move to the cloud, anybody can move to the cloud. You, I mean, these sort of a compliancy, scare, mongering, you cannot move to the cloud because of PCI or HIPAA or those days are over because AWS, Microsoft and Google, that's the first thing they do. They have a stricter compliancy than most on-premise homemade data centers. So I see that industry really moving into the cloud now. Well, who knows what AWS reinvent 2020 will look like. Gentlemen, I wish we had more time, but thank you both, Jhansi and Anthony. Thank you very much. We're talking with Justin and Amita today, sharing what's new with NetApp, what you guys are enabling customers to do in Multac. We'll say Multacloud. I'll say it. All right, we appreciate your time. Thank you. For my co-host, Justin Warren. I'm Lisa Martin. You're watching theCUBE from AWS to reinvent 19 from Vegas. Thanks for watching.