 We're back, this is Dave Vellante with Stu Miniman and this is theCUBE, we go out to the events, we extract the signal from the noise. We're here at the VTUG Winter Warmer at Gillette Stadium and we're experiencing Stu's January thaw here. We're waiting for the two feet of snow that they predicted in the Farmers' Almanac, but we wish the game were here this weekend and it's in five degree weather but it's going to be balmy in Denver. But we're here and Tony Asaro is here, he's the CEO of the INI Group and one of the sharpest analysts that I've known in the business, coverage storage, virtualization, data protection, cloud and you know, can really run the game at Tony. Welcome to theCUBE. Thank you. It's really great to see you. I think this is the first time you've been on theCUBE. It is the first time, yeah. That's awesome. I'm giddy. No, not as giddy as I. So you guys, you and Chris gave a keynote this morning and I was bouncing around, I have to say, you know, the AWS stuff I'd heard before, the rack space guys were geeking out heavily and so I found my way to your session and I thought it was very interesting. I especially liked the way that you touched on all the hot topics and then you drew in the audience like okay, so we in the analyst world and the trade press and so forth focus on all these hot topics. How much of these actually being adopted by the practitioner community and there's a big gap, isn't there? There is. It's interesting and one of the things, I mean really the whole community other than the users have to think about what's coming up next as a priority. So you've got the press, you've got analysts and you even have the vendors that are constantly pushing the hype or the next thing. Whereas the IT folks, I mean they really are more of risk mitigators. They don't want to interject any risk into their environments. So for them, oftentimes change management means don't change anything. Well, so you were actually asking the audience, do you see a threat, for instance, from the cloud and a couple hands went up and then you even said, you know, I don't really think it's a long-term threat but the fact that you even asked that question, you must think about that and practitioners do think about that. What do you make of that whole dynamic? Well, I think we had probably about a hundred people in that session, IT professionals and I think that about a third of them felt that the cloud was somehow going to be a threat to their jobs and that isn't good because they may be ignoring some innovation that could help their companies but they don't want to go that way because they think they might be shooting themselves in the foot, right? So that's a problem. I don't believe that IT professionals are threatened with their jobs. If they're good at what they do, if they're experts and if they can add value to the companies, there's always room for IT professionals inside of organizations. We've seen no conditions in which there's been a mass destruction of IT jobs and in fact, maybe it might be because of where you're located that you might have difficulty but it's a great wide world out there and the people who are implementing a lot of new systems and new services are really the service providers, the very people that they feel threatened by the cloud providers and so there's plenty of opportunity. Well, when we talk about cloud adoption on theCUBE, we talk about sort of these waves and they've come and gone. When Amazon came out at first, we had the developer community and then when 2008 and 2009 when the recession hit, a lot of CFOs put the brakes on capital spending and a lot of people went to the cloud. We came out of the recession and that's when you saw the shadow IT effect really start to take off and you talked about it in your talk today and you said a couple of times, that could be a problem and I think you were saying to the IT guys, look, they're off doing things that may not fit the corporate edict with security and compliance and so forth and you don't even have a visibility on it and then you ask them how many here are using public cloud and just a couple of hands went up and you know and I know, guarantee that many, many more of those organizations are using public cloud but they don't know it so what is the playbook in your view for the IT practitioner? How can he or she sort of maintain their influence and not be seen as sort of a knuckle-dragger just deploying the infrastructure? Well that's, I think that's a great point. There's a few things to be said in that. Number one is, is that, you know, lead on the cloud. Cloud can play a significant role in your environments and without incurring capital costs or dealing with, look, the reason why virtualization took off is because it actually increased our efficiency and cloud can do the same thing. So it's not an all or nothing proposition. So lead on it, you know, be an expert on it. Even if you don't want to deploy it, make sure that you're an expert on it so that when you go to your organization and say, hey, here are the reasons why we shouldn't do this in order to avoid shadow IT because anybody can just go on and get a credit card and get AWS services or Microsoft services and the business people can do that without the IT people even knowing it. So the idea that you should lead on it versus falling behind on it or ignoring it is a problem. And the other thing is there are tools out there to allow you to find out who's using and who's deploying cloud. And so you should take a look at those and say, hey, you know, I don't know if people are using cloud or not, they may be. So let me put some tools in there to put some controls around it and take a look at those as well. I want to switch the conversation into another topic. Hot topic flashed, very disruptive to the spinning disk world. You brought up a company called Nimble. I was actually impressed by the number of practitioners in the audience who had heard of that company. They did a multi-billion dollar IPO. Their valuation's up over three billion now. So you now have sort of the haves and the have nots in flash. First of all, let's start with what are you seeing there is flash going to take over the world, replace spinning disk and is this flash trend a bubble? Is it sustainable? Let's get into some of that. Well, you know, you've been around as long as I have in the IT world. And I remember when... Even longer. I remember when flash was the bottom feeder, right? And I remember a flash. Sure. Yeah, flash provider. We have been around long enough to remember the first SSD. Yeah, SSDs were, you know, the SSD providers were struggling and now it's all the rage. And there's real value in that. And the whole idea is that not everything needs a million IOPS or submillisecond latencies. But what we want to do is we want to remove performance as an issue. And right now the storage system providers are saying, the ones that are trying to optimise around flash saying, we will never be the bottleneck. And that's really what they're trying to do there. Nimble is an interesting case because, you know, what they've done is they said, look, we understand that the fundamentals are important in storage. So we're going to provide you all the fundamentals and we're going to provide you with high performance and capacity optimization so that we can give you a low cost per IOPS and a low cost per gig, right? And those are the fundamentals, right? So take a look at the other companies that are doing that that provide you that. You know, there's Tagile, there's Nexan, there's, you know, XIO. So there are other companies that are providing that same sort of value proposition. Nimble's done a good job of their go to market. Their execution's been excellent and they've led the way in that SMB and in that mainstream marketplace. So EMC in particular, but I would put IBM in that mix, HP, even Dell to a certain extent have made a lot of money being that bottleneck. That's right. And so those companies are looking at their, you know, the same way of doing business is not sustainable, would you agree? Okay, so my question is when you look at, for instance, EMC's acquisition of extreme IO, obviously HP's going its own route, IBM buys TMS, et cetera, et cetera, et cetera, will those guys be able to successfully make the transition or will these, the new guard, the Nimble's, the pure, I mean even to a certain extent, the Fusion IO's disrupt that order or will it be the same old EMC keeps kicking ass and getting 35% of the marketing? Well, so EMC and NetApp have both created hybrid solutions as well. So they put flash in and they all have multiple strategies. And the beauty of being EMC is that they can put things in multiple places. So they've got a product that competes against Fusion IO, they can put SSDs in the back end of their storage, their current storage systems, they now have extreme IO. So they're approaching it strategically and trying to figure out how they can go about and win in this market as well. They all have the above strategy in whichever one wins. Yeah, and NetApp the same thing, but we've seen this movie before, right? We've seen these next generation storage system guys come up and challenge the status quo we saw with 3-par, equal logic, a component on and on, Icelon. And everyone taking that market in different areas and they get to a certain point where they get the interest of the bigger guys. What's interesting to me about- And they get bought out. And they get bought out. I mean, if I could jump in there, because Dave and I have had this discussion a lot. In a lot of the previous waves, it seemed like it was a feature. And once it got big enough, it got bought out. And we saw waves of this come through. So how much is flash going to just be a feature or is this fundamentally going to change? Well, yes and no, those do, right? I mean, I could say that about, in a way, 3-par with thin provision, but Icelon, I mean- Yeah, Scale Out NAS, which is not a worry, but they all got bought out. So I don't agree that, respectfully, that it was just a feature. What these new generation guys did was that they created a very highly virtualized storage system, right, that had not just thin provisioning, but they had ease of use, ease of scalability. And in the case of 3-par, the RAS, the reliability availability is compelling as well. So HP took over that and said, hey, look, we need an EVA replacement. And it filled a major role for them. For Dell, ecological and compelling filled gaps in their portfolio that they had no answer for, because they didn't have any intellectual profit themselves. So, but to Stu's point, none of these companies were able to, not even 3-par, were able to, in fact, when 3-par was a public company, it was struggling to make any profit, because any profit it had, David Scott had to invest it so we could expand in some place in Asia. And so they weren't able to unseed these guys. So I think the implication I'm hearing of Stu's question is, will that change with Flash? Is Flash just more disruptive, say, than the tier 1.5 guys were? And will we see at the end of this, will there be new standalone players that we're going to see in the big pie chart of storage? Or is it just going to be acquired or taken over by the IBM's HPs and EMCs of the world? No, I understand the question. And what's interesting too is that on the surface, you could say, well look, Flash is just hardware. So what's the big deal? I mean, software at least was a big part of the other guys, right? So what new in the software realm are these guys bringing to the table? Turns out making that hardware efficient, making it reliable, ware leveling, right burnout, all of those things and keeping costs down, getting efficiencies out of that hardware is very, very difficult. It's not a slam dunk, right? There's a lot of intellectual property that goes into that. And from that perspective, it isn't just as easy as saying, okay, I'm going to go take my current platforms and bring that same technology to those current platforms. It's always that old technology that you keep shoving stuff on to try to make it better and better. It just becomes difficult. So yes, I do think that these new guys do have some value over the 20 plus year architecture that some of the leaders have. And that's why it will be relevant. As to whether their exits will turn into acquisitions, remains to be seen because I think that a lot of the big, large storage OEMs have made their bets and I don't know how many more bets they're going to make. Right, so history is kind of instructive here because if you look at the virtualization trend, the storage virtualization, EMC tried with Invista and failed miserably, but NetApp didn't have to make an acquisition. And it navigated through those waters very, very nicely. HP obviously had a gap in R&D spending and had to. And then if you look at what's happening now with EMC trying to preempt what happened with Avamar and Data Domains and all right, let's go out and buy the Extreme IO, that's the best one. Now, the question is, is that the next Invista or is it the next, the preemptive Data Domain Strike? And we don't know. I don't know. The great thing about EMC is that they are a sales machine, right? So. If it works, they'll sell it. If it works, they'll sell it. Unlike, you know, and I love NetApp, but unlike NetApp, who's historically terrible at acquisitions, right? When they do them, they don't tend to turn out so well. And EMC's got a much better track record, but again, you know, they're not batting 1,000 either, right? So there's always a challenge there. Yeah, so, you know, great point here. And to put a point on something you said, Tony, the innovation isn't in the hardware. We expect kind of the nan suppliers to go through consolidation over the next couple of years. And it's the software and the new architectures that are doing things. So we said, you know, Extreme IO is interesting. EMC also bought Scale IO to a new architecture, what we would call a server-san architecture. So servers turning into that storage architecture. So VMware's coming out with vSAN, you know, this year to be able to attack in that space. You've got some of the startups in the space, like San Balak and Maxsta, that lots of new players that, you know, are looking to get rid of the traditional storage array, which is a hot topic. So what's your guys call? I mean, it didn't happen with virtualization. It being a standalone, large company that became a major player in the storage business didn't happen. Storage virtualization, sorry. And it didn't happen with data deduplication. Will it happen with Flash? Will there be an acquisition-proof Flash company that emerges and survives and thrives? What do you think? I think that the world's different now than it was in that previous transformative stage. We're in transformative stages right now. So that first stage included people like three-par and ecologic-compellant isilon data domain. And this is a little bit different now because they've made billion-dollar investments in a lot of those acquisitions. So I'm not sure that any of the guys who have the big checkbooks are gonna be buying a lot of stuff that's out there. So the current storage system players that are focusing on performance and solving that problem, I think that it's less likely that people are gonna be eager to write big checks for them. So they are going to have to create a sustainable business model. So that's the favorable scenario for the sustainable business model, whether or not they can pull it off and compete. It's always a challenge, right? Who are the horses on the track that we should be watching? Obviously Nimble, Pure, who else? Well, there's Tadgyle, right? So they're another interesting one. The hybrid guys, right? And you know, I think... Tintry. Yep. And we'll see what Cisco does with Whiptail. That's gonna be an interesting one. And they all play in different markets. SolidFire is another one, right? So SolidFire is going after the service provider market. So there isn't necessarily an analogy for a comparative analogy to all of them. And then there's some guys that you probably never even heard of, like companies like Cash.io, right? So you're gonna start seeing more and more people coming up the chain to do that. And if you take a look at the market, there still are gaps in their portfolios, right? Dell has a gap in their portfolio. HP has a gap in their portfolio. I would argue NetApp maybe could... NetApp has a gap in their portfolio. I think Oracle still has a gap, and HDS still has a gap. So there's still gaps out there. There might be acquisitions. I think probably at the higher end, not the lower end. I think that the Nimbles and the Tadgyles can fill less of a gap than some of the bigger players that are doing the enterprise level, million IOPS, 50-second microsecond kind of latencies. 10 gigabit per second, gigabyte per second throughputs. So we've got five or six minutes here. You guys spent a fair amount of time talking about the software defined. I mean, you went into networking. You actually stayed on compute for a while, and you put forth an LPAR analogy for virtualization of V-PARs. And as you put forth, as, hey, maybe we need more granularity further down the stack. But by the way, HP actually has a technology called V-PARs using HP UX, so virtualization. That one's taken. Yeah, I want logical partitioning to happen at the processor level, though, not above it. Right, right. So why can't we take Intel AMD processors and carve them up the way that you can in the mainframe? And because there are a lot of cases where you don't actually need a full virtual stack, if you could do it at a lower layer, that would be useful for a lot of especially high-performance applications. So then, sort of what I'm calling, well, I guess HP's calling V-PARs, and then you do it at the core level, maybe at the port level. So how would that change the way in which we would manage virtualized infrastructure? And what are the benefits and what the security needs have to change? Right, I think that the benefits are that, you know, there's a lot of applications that I'm not putting into my virtual environment because I don't want that virtual layer. I don't want any latency. And I want deep control of my hardware, right? I want to know all of that information. So there might be some mission critical apps that require the highest level of performance and yet I still want to share some infrastructure because I still have a lot of overhead, right? So if I carve up at the processor level, I can then simply use that infrastructure at a much more granular, more efficient level and still have all my hardware control. I think that it opens up a whole new market and not just for the business folks, not just for end users, if you will, vendors. You know, all these vendors now are using open commodity-based servers for their controllers. Imagine if they could carve up those processors because they're not building their architectures around virtualization. They're not virtualizing their stacks, right? So if you're a component, for example, and you're running on a Dell server, right now, you're single-threaded. You're not using both of those processors or multiple processors in those. You're letting one processor or multiple processors not do any work for you. You're buying that whole system for one processor to run your environment. Okay, so that's the compute side. What about the storage and the networking? Maybe we start with the networking is, and I know that's not your core area, but still, you follow the industry. I grew up in networking. You did, I didn't know that. Okay, so what do you think? I mean, do you think VMware's got it right? Is the NYSERA acquisition disruptive and sustainable or Cisco sort of did they just awaken the sleeping giant? Well, I think that somebody has to awaken the sleeping giant because they've been sleeping for far too long, and... It's still dominating. And still dominating, you know, and that's good, but that also leads to complacency, right? And we don't want that. Absolutely. And lower prices and lack of innovation and stovepipes and all other stuff. I think I really like conceptually the idea of software-defined infrastructure in general and software-defined networking. But in what I'm finding is, and this presentation we did earlier today bears this out, which is that virtualization administrators, it's not a priority for them. It's something that they have a level of interest in, and yet it's not in any way a serious project for them. Yeah, no hands went up when you said who's got a project going on in software-defined anything. And the way IT works is they look at their forward year and say these are the three to five projects we're gonna budget and we're gonna resource and we're gonna focus on. And you've missed that window. So that means that if people are gonna start taking it seriously, you're looking at the next cycle in which people do that. So when do you think this actually becomes real? Is it even 15 or is it 16 or beyond? I think you know how early adoption happens, right? You're gonna get the early adopters, they're gonna get to some level of it. But yeah, I think we're multiple years away from it becoming mainstream. I think we're at least three to five years. However, I think the vision for that is that at some point, we don't have to have these so large physical networks. We can get rid of all of that stuff, right? Both LAN and SAN, right? Both communication and both storage. Where I can now just put everything into servers. I've got enough capacity in these servers. I've got enough redundancies in servers. I can share everything through virtual infrastructure and then I can get rid of a lot of my critical paths so that I can simplify my environment, make it low cost effective and make it much more high performing. So for decades, we've seen storage function move out of the host into the storage array. For good reason and it's moving back. Do you see that? How far do you see that pendulum swing? It's moving back physically but not logically. That's the point. The point is logically that my architecture still looks the same. Physically, it's completely different. Yeah, okay. So you're arguing that logically it has to change in order to have an impact on business value. Well, I'm saying logically it's gonna look the same because the software is gonna all make it seem to the applications that I'm still, I've still got my old networks but physically it's gonna completely be disrupted. Excellent. I'll give you the last word. Tell us, give us an update on I&I. What's going on there? I&I, so my company is actually morphing a bit. I am focusing more actually, quite frankly on angel investments and things of that nature. So I'm having a lot of fun doing that. Just making your own personal investments and sprinkling some of the love around. Sprinking some of the love around. What are you looking at? What areas are you looking at? I'm looking at the high performance area as we just discussed in storage. I'm also looking at the managing unstructured data, moving it, analyzing it and making it more efficient because it's just unbridled right now. We have tons and tons of unstructured data out there with no controls over it. I saw in the news today, data gravity, Paula just landed I think what, 14 million? Yeah. But what's going on? What do you make of that? What Paula does? Yeah. She will land lots of money. She's going to attract dough, right? Yeah, she's going to land lots of money. What do you know about what's going on out there? Can you share? Well, I don't know if I can't share too much because I think they're still somewhat in stealth mode but they are, they're focusing on storage which is Paula's expertise and they see the challenge of managing unstructured data as well. So I think they're doing some really good things there. Yeah, I'm squinting through. I just been talking to those guys in very rough terms. It's like decoding what they're saying. Seemed like an intersection of analytics and big data and storage and unstructured data which is a huge problem. We need to get smarter about how we manage our data. So storage has so long been about the fundamentals of storage, not about data. So instead of dealing with things in blocks or files we have to start dealing with data as something that has value above just storing it. What do you do with it? How do you control it? And I think that that's a good evolution of where storage would go. Excellent, Tony Sauer, thanks very much for coming by theCUBE. Great perspectives, really it was a pleasure having you on. Keep it right there everybody. I'll be back with Stu Miniman. We are live at the VTUG Winter Warmer. This is theCUBE.