 Live from Mountain View, California, it's The Cube at OpenStack Silicon Valley, brought to you by headline sponsor, Mirantis. Here are your hosts, John Furrier and Jeff Frick. Okay, welcome back everyone live in Silicon Valley. This is OpenStack SV. I'm John Furrier, the founder of SiliconANGLE. This is The Cube, our flagship program. We go out to the events to extract a signal from the noise. We've been doing The Cube, it's our fifth season. And one of my most exciting things about The Cube is we're going to talk to some great luminaries, experts, friends, guys who just know what they're talking about, just tech athletes. And that's really what this next segment's all about. Our next guest is Lou Tucker, who's the VP CTO of Cisco Cloud and Jim McHugh, VP of UCS Marketing. Guys, welcome to The Cube. Again, Cube alumni's both. Welcome to Silicon Valley. I love it here. Silicon Valley is where the action is. And I'm so glad they did this event because this event was kind of an ad-hop splash mob. It was like, yeah, well, we got Paris coming. They did Singapore last time. And no one really flies that far. No one wants to fly that far. It's expensive. And so Silicon Valley, the demand is so high right here. The people are all here. This was one of those pop-up shots, whatever, right? I mean, they just appeared because this is sort of the center of this. It's great to have OpenStack come to Silicon Valley. Are you seeing friends here? Tons of friends. This is one of old home week. I mean, I think that the community's now large enough that we are our own sort of tribe around OpenStack now. And we go from venue to venue, company to company, I think, in some cases. Yeah. You see someone, hey, remember we worked together 10 years ago or whatever? Exactly, right. And it's fun. Everyone's got new fresh assignments, ideas. I mean, OpenStack reminds me of the old days in the 80s and 90s when you start to really think about re-architecting things. And Lou, really, first question to you is, and we've kind of talked about this before, but I want to revisit it, it's distributed computing. It's systems programming, it's network architecture. It's all rolled into one now. And it's a little bit of the same paradigm concepts, but rolled differently with the modern needs, which is integrated stacks, faster response time, north, south, east, west, virtualization. What's your take on it? I mean, as a computer scientist, you're certainly an energized bible, what's your take? So, you know, actually, Martin gave a talk today and he talked about what makes it sort of so hard for us to do policy-based computing. So, as computer scientists, that's how we'd like to really make this work. Anything, well, in virtualization, we created a new platform there, but that was for the IT, people, not for apps. And now, what is the platform for application developers? Application developers in today's age needed a platform that runs across the entire data center. It can't run on a single host, it runs across a thousand hosts. That's what OpenStack is. It's that platform for the application guys. And now the application guys go, okay, so I can have VM or some other application guys. I want a container. That's even a lighter weight construct for me. So, this is all about getting the apps built. And that's what I think is fun. It's kind of interesting that we're getting a lot of people who may be built apps who are now finding they're having to rebuild the infrastructure, the platform, because that's the kind of platform they want their apps on now. And Open Source certainly playing a big role in it, which is not proprietary, it's completely out in the open. We were just talking earlier with some of the HP folks about shipping code now in this era where people see your code right away, you're on fear. It's in the open. Exactly right. You can't suck. I mean, really, I mean, if you suck, you know quickly. Yeah. And if you keep sucking, you're out, right? So, it is, it's ruthless that way. I mean, but it does produce better results. And in fact, I interact a lot with our, you know, intellectual property attorneys with in Cisco and they want to know how are you vetting everything that's going on and saying, it starts in the cloud. We're starting it in the public. Every line of code is written in the public first. So therefore, we're, we can certain patent ideas and everything else that really isn't effective, but the quality of the code is subject to immediate inspection, like you say. So where we have had issues is oftentimes people are not used to that model. And so they try to hide stuff in their code. You can't hide an open stuff. Yeah, you can't hide the ball. Everything, Jim, customers don't want the ball to be hidden either. So what's your take as you talk to customers? Because your install base is massive. So it's not even like, even discussion. It's such a massive install base. So you have install base and you've got to modernize either incrementally or refreshes. Yeah, well, you know, the funny thing is Lou and I go far enough back in open source that we're so used to having these discussions with customers and explaining, you know, what they want is, you know, that, you know, I think people said it today, they want to trust you to deliver the business outcomes they need, but they want to back up plan just in case, you know, because you can't suck, like we said it, but- Well, from a customer standpoint, you're out of business. Consequences are pretty grave. And so what they're getting now is the freedom to say, look, I know you're going to go down an open path and I know there's a whole community behind that path that is actually going to keep you on track. And so that is absolutely what's going on. And we're just excited to see it happen. I mean, this is what we've been working for. So what's your take on open stack? Obviously, Silicon Valley, this is like, you know, like an event, it's a party. I mean, it's a tech party here, as you're saying. How is the open stack community doing from a Silicon Valley standpoint, Lou, because, you know, we want to move fast. Everyone's got their running shoes on, they're powering through. They want to see, you know, things better, faster, cheaper. And it's a growing organization, it's very young. Yeah, it's very young, but I think the idea has already put down deep roots. And so the idea of open stack, of a community built in open source platform for cloud computing is so compelling that we've got Eucalyptus being bought by HP and now Martin Mikos is now at HP. So this is an idea that now has been really broadly accepted, particularly within Silicon Valley. We will, now it's the next phase. We've got to get into the next phase where we now have our entire ecosystem of other companies that are built for open stack, built these things on top of open stack. We've got to get the rest of the ecosystem built out. So I have to ask the question, if HP's all in, is Cisco not all in? This goes all in. Okay. This goes all in. Of course you're all in. Come on, put the chips in. Call the bluff. It looks like it's six to twelve. We recently announced our inner cloud that we're spending a lot of money and building out, essentially, delivering open stack as a service. So now that we're building that as a service and as a service that will be very important for Cisco's SaaS application around collaboration, WebEx, security, all of those SaaS services built through our partnerships. And then with the UCS team, we've announced open stack solutions that we can deliver to be sold to customers for on-premise deployment in their own data centers of open stack cloud. Jim, talk about the customer aspect because being all in, also matters, you've got to actually deliver the solutions. The data center is really changing significantly. You're, you know, with UCS, you live this every day, this is your world. What's the update on the data center? Because born in the cloud, certainly Amazon has shown they're winning there. Okay, give them that, but not everyone's born in the cloud. People are born on-prem in enterprises as a data center. You know, I think what Amazon showed that if you pay attention to the developer and meet the developer's needs, you're going to do well. So whether they're winning in the data center, there's still a lot to go on the data center. And you know, I think what we're seeing more and more- Amazon's not winning in this. They're trying to even get the foot in the door. That's their big push. So what we're seeing more and more that customers are demanding, what's the right platform for the application? Right, and that is this idea of application-centered infrastructure or just applications driving the business needs. So there's plenty of solutions right now where we just go to market and it's running on Linux or some are running on Windows, right? And they fit there. But the newer application isn't there, right? The newer application's target is OpenStack. A lot of things we're doing around big data. A lot of the analytics stuff that's coming on. It's just demanding a whole new way of going about it. And Cisco knows that. We're treating it, we're actually developing our infrastructure and coming out with product lines that actually meet those different work needs and are targeting to solve those. We're just having this conversation with HP. It's a little bit more severe there with their turnaround with Whitman kind of leading the five year turnaround, which is huge and that's a long time. There's a lot of luxury there, but the comment I was making was what a great time to do a turnaround because we all know that big gust of wind is going to be coming on a sustained basis. That's the inflection point. That's this awesome innovation convergence. Everything's happening, right? So platform up and down the stack is completely changing. So if you're on the right side of that wind, you will win big. Certainly at the size of HP and Cisco, you guys aren't hurting. You guys aren't doing a turnaround. What bet are you making? Where are the sales on the market? Are you betting on hardware commoditization? Are you betting on software? Are you betting on, what's the thing? I think we're betting on the fact that applications are changing. And so if we take even the service provider market and for example, most people know we've been working directly with Comcast and a lot of things. So that entire market's realized, for them it's a time to market for their new application, their new series, their new product or whatever, building it on a cloud that's the best way to do that. So those that entire cable market is shifting now for redoing their data center so that they're running a cloud for their Xfinity application. This is not to be a cloud provider. They're doing it just to accelerate their application deployment time because they're competing again, Amazon, Google, Netflix, and everybody else who's using the cloud. So they want to take away that advantage that they have by building their own. The second area is in terms of what we hear NFV because that's where we're realizing that again, the time to meet the demands of new customers coming in wanting different kinds of networking services delivered to them, VPN services, you know, backfall, all of these different things, it can be delivered much faster if they do it through software than through wheeling in big expensive appliances. Cisco sees that from their customers, hears that from the customers, and so Cisco's responding. And so most of our NFV work now is all based on OpenStack. And so I think that we'll see that OpenStack is pretty much becoming the fact that it's sort of standard platform for deploying NFV applications. So developers, Jim, you mentioned that, you know, anyone who can get the developers in a spot that's positive will win big. Lou, you mentioned the bet on changing applications, NFV, you're talking about really the future of how people program. So I got to talk about the enterprise. The enterprise really hasn't had a developer strategy since the mainframe, in the old spaghetti code days. We used to call it. This client server, basically everyone else, all the outsource channel did that. Management consultant's the big six at the time. And then the web is the web, and now we have born in the cloud. So we're seeing a complete shift. Enterprise are hiring in-house developers. What is that, how do you see that? Are they hiring DevOps guys? Are they hiring? I think it's in two areas. One, it's not solely original application development. Most of this is rapid deployment if they're going to, let's say big data, they want to run Cloud Error. They want to run any of these new applications. They want to know how quickly can, they don't have a year and a half to integrate this into their old environment. They want to be able to have five different companies come in with an application that's built for the cloud that they can do a bake-off right then and immediately compare these different applications and then make a decision. Their DevOps come into play here because they still are running their infrastructure and they want to essentially reduce the cost of running their infrastructure through increased automation of that infrastructure. And that's where the DevOps model comes in and it's the two layers. One is in the cloud layer itself, an open stack and the other is of the application orchestration, the new apps that they're bringing in. They need to also be orchestrated. And so that is the new developer in IT. So we're getting some, David Pollock's got a funny tweet here, just kind of changed the game here in the CrowdChat and in Japan, Feudal Japan, they made Samurai step on a cross. What's open stacks loyalty test? Oh boy, that's interesting. Thank you, David, for that great tweet on the CrowdChat. I think it's a loyalty test to the open source principles around transparency, around open code, around code speaks louder than anything else. If you want to win an argument, show me the code. Those are the things, the cross that we're stepping on and the need for protecting things by locking them up behind proprietary implementations. Instead, going for direct benefit through the transparency and open that you get. So doing it in the open. Doing it in the open. All right, just treated that back. Thank you, David Pollock. So Jim, back to you, customers. What is the biggest shift that you see in your customer base that is forcing them to move faster? People are always indifferent. There's always a motivating force that, the fire under someone's butt that goes, I got to do it. Look, and you even heard it today in some of the sessions, our customer has changed. When we were rolling out virtualization, the first phase of success of UCS, which is five years old, open stacks, what, four? It's like one year older than trailing both of these. That was IT. Now it's line of business, right? And if we were starting a company today, how many of us would actually know that a big data center? We wouldn't. We would consume services. And that's where the line of business guy is driving. And then there's another customer that's coming around that's actually probably even more important than developer, the data scientist. The guy that actually doesn't want to set up their Hadoop infrastructure or know how, what open stack is running right now. He just actually wants to do the processing data and finding new customer insights and trying to drive a lot more activity. And so with these factors coming, you have, honestly, IT is becoming that benevolent dictator where they can actually say. Well, IT is, IT changed from being a department to everywhere. I mean, that's, remember, IT was a department. You called them up for things. They did stuff. They racked and stacked. Now it's, what, now I don't want it. So people are bypassing IT. No one's happy with IT. Well, now, well, not entirely true. There are really good. I'm overstating the trends. But if you did a survey, we did a survey in Wikibon on Hadoop and IT gave themselves passing grades and they were measuring their ability to do POCs, the business unions were giving them a failing grade for not delivering the value. So there's a disconnect with the perception. I know you guys love the IT, but I do too. But if IT is going to be that, it's like going through the airport. You know, you don't want to take your shoes off or take your belt off, but you do it because you have to. Now, IT was like that, but IT should be a service layer. They are, they are. They are an internal service provider. I think, let's see, you know, Jonathan walking around, we're talking about software to find economy. When things start getting defined by software, you can not just bring your own device, you bring your own app. Why shouldn't we also, if you like a particular app, you bring it in to your domain within your own company, whatever, and you run your app on your cloud. IT simply can provide a safe way for you to be able to do that and know that that app can't do malicious things to the rest of the information. And if they can provide all the insurance, you can bring your own app. Well, by default, you do. Every day you're walking in your phone, you're bringing your own apps. That's right. Yeah, well, David Pollock just commented to your comment, said, why is the focus on the apps end of the day, helping customer workflows is what will bring in the money? I would agree, but that's what I mean. That's the process. That's what an app is. Yes, the app is the money maker, not a cost reduction. In some case, reduction, reducing the cost, but the outcome of value, right? I mean, Amazon is interesting to me, and I want to talk about the impact to the enterprise, because essentially we're getting back to this new model of Amazon's disruptive reduction in cost while increasing functionality is really a really weird dynamic. You don't see this very often. A complete commoditizer while innovating. That is an amazing, because they win on critical mass. You guys have critical mass, so does this influence the thinking in the cloud? For you guys, you mentioned, like in your customer comcast, certainly they're doing cloud for a specific reason. Agility, right? Speed to value. Speed, right. So how does the Amazon concept, is it replicable in the enterprise? Yeah, I actually, I think Amazon proved to the world, and I think that the big debt we owe to them is that cloud computing, we pay it, believe me. Yeah, we buy stuff. It's probably the fastest way to develop and deploy new applications, therefore bringing business value sooner. So cloud computing is that, probably now the fastest way to develop and deploy applications. Therefore, the question is, now I can outsource that to a cloud like Amazon, or I can do that in-house, but I still want it to be on a cloud. I want to get the benefits of cloud which is the fastest way to develop and deploy. Okay guys, we're getting a hook here. I really appreciate you coming on. Glad you could swing in Lou. Always great to talk. Jim, final word, I'll give you guys the final word in this segment. Just tell the folks out there what's happening in Silicon Valley around OpenStack here at this event, and the overall vibe in Silicon Valley. Someone said, hey, is OpenStack hot in Silicon Valley? What's the answer? How would you categorize the state of OpenStack in Silicon Valley? I think we're all sort of proud to be a part of this next wave of computing. We think this is really transformational in terms of changing the entire data center and the way that we look at data centers and the way that we look at our own IT organizations now. It's not just cloud computing up in the cloud, it's also cloud computing in our own data centers. And I think it's great to see the majority in the last couple of years. Sorry, Raiders game this weekend, the football team. The black hole, that doesn't seem to be it. The black hole. And it used to be a couple of years ago about how's this all going to come together, and now we're all talking about how we're going to do deployments together, and that's just the most exciting part. Guys, you got to tear my eye on that note. Being a resident in Silicon Valley, literally, how could you make it? We're doing it in the community. Yeah, it's a lot of fun. I got to say, it is fun. I love doing this. I mean, I sit here and read people all day long. It's time consuming, and sometimes, you know, takes the physical toll, but I love talking to you guys. Appreciate it. This is theCUBE. We love broadcasting the data from the tech athletes to here from Cisco. We'll be right back after this short break.