 Live from Las Vegas, it's theCUBE. Covering Edge 2016, brought to you by IBM. Now, here are your hosts, Dave Vellante and Stu Miniman. Welcome back to IBM Edge, everybody. Hashtag IBM Edge, go to ibmgo.com. This is theCUBE, the worldwide leader in live tech coverage. Mike Cune is here. He is the vice president and business line executive for storage solutions. Great to see you again, Mike. Good to be back, how are you? Another Edge, I'm doing great, thanks. Yup, five on a row. Yeah, we were here from the beginning and documenting the evolution of Edge and it's expanded now, of course, into a system show but it's roots are in storage. Our roots are in storage. Absolutely. And Flash has taken over the storage world. You started, recently started in Flash and you get that whole movement going. Got IBM to leadership position and now it's, Flash is everywhere. Flash has come on strong in 2016. This is 2016 is the year of the all Flash story system we talk about. Now we've been talking about Flash systems, the strategic investment that we made, the billion dollar investment around Flash technology three years ago. We sort of stepped through that chronology today in one of the main 10 sessions and talked about how far it's come but certainly 2016 has been a year where we have Flash optimized the entire portfolio and it's everything from the store-wise, all Flash configurations starting at under $20,000 a year, all the way up to the largest DS8000. Yeah, so we were there actually at the announcement when Mills made the announcement of the billion dollar investment that was in New York in April, bless his cotton socks, I say, his billion dollar playbook. So how'd you spend a billion dollars? Where did it all go? We spent it driving one of the best technologies in the industry, Flash systems. It was so unique. It was such an innovative approach that we branded it Flash Core. So Flash Core is inside as we talked about on previous sessions. This is not a storage system that was traditionally an HDD based system and we put SSDs inside. This was a completely new design, custom built, purpose built from the ground up, designed for high performance, high endurance, high reliability and it just runs extremely fast. So that's sort of the core of our line but we've taken that technology and we've coupled it with some of the best software stacks that we have in the industry, our IBM Spectrum virtualized family, your IBM Spectrum Accelerate family, our DS8000 line. We're selling now a deep Flash 150 with our Spectrum scale for these new workloads that are emerging. So we've actually taken some great technology from a Flash standpoint, coupled that with this great software stack and we're driving it across the entire portfolio now. When we first met, it was at a dinner and I was sitting next to one of your customers at a large telco. He's been on theCUBE. But so, but anyway, you know what I mean. And we were talking about, several years ago about Flash and he said, do you think it'll be selective because it's expensive? That whole narrative has changed, hasn't it? Absolutely, we talk about the tipping point. In the beginning it was, the conversation was about why Flash, why you should deploy Flash, what workloads, did you have the right people and the right proof of concepts to determine the right workloads because it was very expensive. Here's the data point. You go back to the year 2000, right? Not that long ago, 15, 16 years ago. Flash was $5,000 per gigabyte back then. What's it at now? It's less than $1.50 when you consider all the features that you have around data reduction, de-duplication, real-time compression, pattern removal, so it has come down dramatically. To a point where we believe that all Flash storage systems is the platform of choice for all active primary data, so. It's more than that too, right? So you need less Flash capacity than you would spinning disk capacity. The power and cooling aspects. It's simpler to manage. And then there's the whole, you guys announced copy data management stuff today that ties with Flash. You can service more copies out of a single Flash device than you could with spinning disk. It's really a total game changer and it's driving value in new ways that people really weren't thinking. Everybody's so myopic on the price cost per bit. And then marketers had to sell the value and the cost per IO and yay, we sort of got through that. And now the economics are just overwhelming. No, absolutely right. In the beginning it was like, what were those key workloads? What were the analytics workloads? Big databases. Now these use cases are popping up everywhere. So it's all about applications, workloads, use cases. We talk about that all the time. We talk about it at Edge during session. We're really excited about our new addition to what we announced here at Edge this week around copy data management because our new Flash system A9000 is designed really well to work with these large databases. And of course, copy data management, spinning up copies and copies of data is easy to do. What's hard to do is managing all those snapshots, all those copies of data. So the copy data management offerings that we launched here today at Edge are all agentless, runs really fast, and it really needs to have some back end Flash performance underneath it to really unleash the true power of that. So we're really excited about the combination of both our Flash systems A9000 and the new announcements for our copy data management. So talk about the rest of the portfolio. Give us, paint a picture as to how it's shaping up, where you're winning, where you got to fill some gaps and give us the lay of the land. So let me lay out what we've done in just the last five months because we've been on a whirlwind tour. It's been amazing what we've done. Up until this year, we talked about Flash as IBM's Flash system based on Flash core technology. What you always say, you acquired into that space from buying Texas memory systems back in 2012. We have come so far in April, we launched the Flash system A9000. So that is truly our grid scale Flash storage, optimized for cloud environments, both hybrid cloud, public cloud, private clouds. It's got some unique things on there like secure multi-tenancy. It's got qualities of service on there. So truly optimized for some of our cloud service providers and doing extremely well in the marketplace. That comes with full data reduction technology. So deduplication, real time compression, pattern removal and backed by some of the best guarantees in the industry. You know, people always say, well, what is your guarantees? Is it three to one? Is it four to one? Is it five to one? Do you have a website? Do you track it on your ticker? Can you tell me what it is? The best guarantee that we have is we will match any competitor's data reduction technology site unseen. You show us an offer from another competitor. What they can do, we will match it on the spot. So that's absolutely amazing. We launched that in the April timeframe. Service providers are a real interesting use case because on the one hand, they need real scalability. On the other hand, they really need to be kind of tight on price because that directly affects their price. Can you talk to, do you guys do anything special for? The service providers there is the same product that you're selling to the enterprise. So we have revamped our spectrum accelerator line. And if you remember, and you do know, I'm sure our XIV storage system, which is still in the marketplace, still doing really well, we've extracted the value from the XIV product and optimized it for these hybrid cloud environments. So now we can sell IBM Spectrum Accelerate as a standalone product. You can spin it up on a server, a storage rich server, your own commodity hardware. You can spin it up as a cloud service on IBM SoftLayer and you can buy it with IBM Flash just in May 9,000. The best part is when you buy that software application, when you buy that product, you can actually transfer it. So the software goes with you. So you want to buy it as a standalone, you want to marry it up with your Flash just in May 9,000, you want to use it somewhere else that goes with you. So you're not buying it three, four times now. So it's really innovative in terms of what we've been able to offer to our cloud service providers, as well as we help our CSPs with a lot of migration services. The old array marketplace, and you had to go from one to the other, it was a bearer because of moving your data from one array to another. So we put a lot of software functionality inside our stack to kind of do that more seamlessly, but we also help our clients and our CSPs with these migration services. It's been very popular and it's been a great seller for us. We've always said migration is one of those four letter words when it comes to the storage people and it's actually been, if you look at the hyper-converged marketplace, it's getting rid of migration costs. It really helps kind of the TCO. So do you feel that you've got kind of similar to some of those environments pooled storage that I can use? Absolutely, it's all about simplifying, it's all about ease of use, it's all about simplifying it for the storage administrators. The more sophisticated our products and our software gets, the less and less complex it is to the point where we talk to clients who say, we're not going to have storage administrators anymore. We're going to have infrastructure administrators. Before, you used to have a database administrator or storage administrator or server administrator and now we're saying because of the complexity that's being removed, we're down to less and less administrators over all the infrastructure and that's what converged and hyper-converged does for a lot of our clients. Great, so who do you find is the buyer of the Flash Systems portfolio than if it's not kind of being driven by a storage team? So it varies. There's still a lot of control of IT spend that's outside of the traditional CIO or the IT infrastructure operations team. Lines of business, people like the CMOs doing a lot of stuff around analytics. So they're controlling the funds but the CIO and their IT operations that's sort of the key influencer, right? So a lot of spend in that industry, certainly anything hotter on big data analytics and a lot of the CMOs are controlling those funds and Flash is right at the center of making all those applications run just really, really fast. But we're also seeing this dramatic modernization across the data center. So you think about it. We've been talking about Flash now for how long, four years or longer. Still, we're at the very early stages of the adoption of Flash. If you look at the overall enterprise storage marketplace, all Flash systems are still around 10 to 15% overall, which is still relatively early into the adoption cycle. Now, Flash forward, where do we think we're going to be at the end of this decade by 20, no pun intended. You're smiling at me. We know where we think we're going to be. Yeah, a lot of people disagree with us, but yeah. I mean, David, the lawyer's been talking about all Flash data centers when I think he was the first one that I knew of that was talking about it years and years ago, right? We heard today on stage in one of the sessions that we did for the storage trends and directions. Plenty of Fish, which is an online dating site, Owen Morley talked about, he runs all Flash for all his production data. And they say by the end of 2020, by the end of this decade, 70% of all active primary data will be running on all Flash systems. So certainly we're investing for that trend. Certainly we see this rapid modernization across the entire data center. And so, you know, lots of workloads, applications and use cases that are just made for Flash. And now that we've reached that tipping point, it's just sort of taken off. Plenty of Fish guy, two month break even, really. We got ROI in two months. How'd he beat that? All IT projects should throw off that kind of cash. The interesting part of his story is, you know, they have evaluated everybody's Flash technology. He didn't rattle off names, but you know, I spent a lot of time with Owen. He would tell you everybody's Flash technology that he had. He probably had about 20 people's Flash technology over the years. He finally settled in. He's finally been buying Flash for all his production environments. He talked about it this morning in the trends and direction sessions. All of his key mission critical applications are running on IBM Flash storage technology. So we're kind of excited about that. Why did you win? Let's unpack that a little bit. We won because he talked about, we have the best performance, which we talk about with his Flash core design. We've got the best reliability. We've got the best service. And he loved the flexibility of the model. He loved the flexibility where he can buy the standalone Flash system 900 as a standalone, really fast, you know, direct attach or not have the whole storage stack with it. And he loved the fact that you can put it behind like an SVC and have the full functionality of all the data services of Spectrum Virtualize. So it gave him a tremendous amount of flexibility. And you talk about people test this stuff. They test the hell out of it, you know? And it just worked really well for them. Well, the SVC is like the gift that keeps on giving, you know, I mean, it's really great organic innovation inside IBM coupled with an acquisition. It's turned out very well. A lot has changed in this division in the last five years. This group used to have trouble getting product from R&D out into the market. That has changed. I know part of that was a reorganization of where R&D sits. So that's good. The other thing is, you know, Texas member system lightning fast, but no stack. When you guys put it together with SVC, we've talked about that a lot in theCUBE. But then you lacked a lot of those data reduction approaches. And so you got dinged there, but you, of course, another acquisition store-wise. That's coming in. So you talked about earlier in the conversation here how you'll stack up against any competitor. You mentioned the ticker. Funny. And you got to love having you on. But let me ask you a question. So it's not just the workload that determines the data reduction ratio. It's also the technology is what you're saying. Absolutely. You know, we see ways of adoption. So over the last three years that we've been really selling Flash really, really strong ever since we announced a billion-dollar investment in Flash, we've seen it go from the first way, which was sort of the tier zero application acceleration wave. You didn't really require a lot of data services. You just wanted to pick those one or two apps that ran really, really fast. And then you got into the tier one space, the next phase, wave two, we call it, was really about, you know, having the full, you know, data services with it, right? So all the copy services, you needed all the virtualization technology. And then as you know, you know, everybody was talking about data reduction, real-time compression, deduplication. Where was it, right? So we had real-time compression out of the gate because it ran really well with Flash. And then we developed our own data deduplication technology, which it works extremely well. So it's an always-on technology. It's always-on with real-time compression. It's optimized to run really, really fast. And so now we're entering that third wave. And that third wave really is about being optimized for the hybrid cloud environment. So now, you know, the software stack that we combine with our Flash technology really is about, you know, optimizing across, where all your data placement is across on-premises or in the cloud. And really, that's what customers are demanding right now. So that's where we're investing, you know, some back to your earlier question about the billion dollars, where we see the marketplace moving and where we're investing for that technology. What about tape? Where can Flash and tape fit together? Can I put metadata on Flash and tape and go deep? Oh, absolutely. People. Another David Floyd term. Yeah. You know, tape is having a huge, huge comeback. And, you know, a lot of people have been saying, tape is dead. And I remember when I worked in the mainframe division years and years ago, they were saying, I can tell you the exact, you know, year that we're going to unplug the last mainframe. Well, guess what? That hasn't happened yet. And what I saw this morning says it's got no signs of slowing down. Same thing's happening with tape, right? So tape is having all kinds of new use cases. There is no cheaper media out there than tape, obviously, right? So combining tape with Flash, having all the metadata run on these Flash applications, but having all the data stored on the cheapest media is really a killer use case. So we're working right now to do a lot of stuff around video surveillance. Video surveillance is that use case that's really made for Flash and tape combined, right? Think about it. You want to have, you want to have, you know, lots and lots of video footage on tape, the cheapest media, but you have to call it all back at some point. You have to edit it. And you can do that and probably work on that data for maybe an hour. And you can have what you want. You're going to save it. And you want to dump everything back and save it on the cheapest media that's out there in the marketplace. So that's one of the killer use cases for Flash and tape right now that we're really excited about. Yeah, and if I can put the metadata into Flash, and I can search that super quickly, it's cheaper than, way cheaper than disk. And actually, for certain use cases, can be faster because of the bandwidth. Nobody's investing in disk heads anymore. You can't stagger disk heads. I mean, you can, but really, you know, it doesn't make any sense to do that. Every time I see David, I just saw him at the Flash Memory Summit. We talk about the all Flash data center. We talk about Flash. Well, but he made that call. I got to give him credit. He tapped me in the shoulder when they said, I want to talk to you about tape. I'm like, no, I can't have that conversation. No, it's coming back. Exactly. Why? And he explained to me why. And of course, there aren't many companies that are in a position to take advantage of that. Right. It's like a handful. And we've put a lot of tape into some of these large cloud service providers as well. So what we're seeing now is these cloud service providers went the technology, went the software that we have to manage things across the hybrid cloud environments. So that's really exciting. So we talk about tape coming back. It's not just traditional buyers, it's new buyers as well. So very exciting time for us. So the storage landscape is changing, Mike. We just saw Dell acquire EMC. You got Amazon coming in as a service, IBM itself, with SoftLayer, making a big play in storage with the, you guys made the acquisition of Cleversafe. So all kinds of shifting sands. How do you see it all shaking out? What's IBM's position? Well, these are exciting times. There's probably more change happening right now in the storage industry than has happened in probably the last 20 years. You also mentioned to me off camera, just before we start this, we have a new general manager in storage as well. So we welcome Ed Walsh back to IBM. He was previously here. He successfully worked in four different storage startups over his career. And we're glad to have him back. We've got a lot of great changes out there. We think that this Dell EMC merger is giving us a tremendous opportunity right now to make some significant inroads that we didn't make in the past. So we're really excited about what's happening. And I think the investments that we're making around our software defined leadership is really going to serve us well moving forward. So we're really excited about that part. And of course, I'm really excited about the Flash technology as well. Good. So what have you seen at Edge? What are the customer conversations like? Share that with us. A lot of excitement. Over 5,500 people at Edge. So these things just keep on getting bigger and better and more exciting. We made a conscious effort to really let the customers spend more time talking about why they chose IBM systems and how that's helped them change their business. And the feedback that I'm getting from our clients, our end users, they really like that. This is an opportunity for them to network with their peers to talk about what they're doing. They all have gone through similar stories. In the beginning, they were not quite sure about making the shift. How do they make the shift? How do you evaluate the technologies? And now, I think there's some pretty pervasive trends that are starting to take off. And so when we let the clients have the microphone and do most of the talking, it seems like it goes over as a much better conference. So we're really excited about what we've seen so far today. Yeah, Edge evolved nicely. I mean, it was a small little boutique conference in Orlando five years ago. And now it's extended into the entire systems group. And IBM always does a good job of getting interesting speakers on and thought leaders, you know, Jason from MIT, you know, kind of futurists. Yeah. It's a little brain teasers at these events. You got a great website, IBM Go website as well. IBM Go. IBM Go.com. Yeah, check it out. It's like, it is a great website. All the content from this event and all the major IBM events in that one resource. It's a good digital engagement. So thank you for that plug. Appreciate that. All right, Mike, great to see you as always. Great seeing you. All right, take care. Thanks. Keep right there. We'll be back with our next guest. This is a Cuba live from Vegas. Right back, IBM Edge.