 Live from Nice, France. It's theCUBE, covering Dotnex Conference 2017 Europe. Brought to you by Nutanix. Hi, I'm Stu Miniman, and here with SiliconANGLE Media's exclusive coverage of theCUBE live from Nutanix Dotnex Conference, here in Nice, France. It's the fifth Nutanix conference. theCUBE has been, had the pleasure of broadcasting from all five of them. The second annual European show, over 2,200 in attendance here. We're in the Acropolis, which is a little ironic because, of course, Acropolis is one of the product names of Nutanix. To help me with the introduction today, happy to have Martin Veitsch, Veitsch, sorry, is a contributing editor of IDG Connect. Martin, thank you so much for joining us. My pleasure. All right, so Nutanix, it's a year after they IPO'd. I've been tracking them since they were a very small company, I think, a friend of mine was somewhere between the number 20 and 30 employee in there. They now have 2,800 employees worldwide. Talked about, they have thousands of Nutanix certified people just in Europe alone between the employees, the partners, and the customers. What's the vibe been for you so much? Tell us, bring us in for the Nutanix show. Yeah, like you, I followed them from pretty much the early days. I always thought they were hard to trot. They were an exciting company. Back in the day, the narrative made a lot of sense. They looked like they were a company very capable of executing. They seemed to have great management. And what really surprises me is, if anything, you know, in this business, we have a habit of, you know, overdoing it and praising these people to the skies and saying, this is the next big thing, next big thing. I think these guys really undersell themselves sometimes. To me, you know, the Goldman Sachs line that Dheeraj Pandey, the CEO, used earlier on when he was talking about the Goldman Sachs comment that it was a once in a decade opportunity. To me, the company that remind me of a lot these days is VMware. I think, you know, that's the company they're going to work with, go up against. And they remind me a lot of that infrastructure, revolution kind of play, you know? Yeah, absolutely. And I think Nutanix would like that analogy because number one, they, I love the line. They did a little song at the intro with a... Yeah, that was pretty wacky, wasn't it? They're having a little fun. They've got a fun culture. Dheeraj always says they try to be humble. From a marketing, from a sales, sometimes a little aggressive, but you need that to kind of break in to the enterprise space. But they said, in the song, they said, we used to sell boxes. Now it's all about the software you know. You know, so what they've been pounding on is it's one OS, you know, one click, any cloud. So the question I've been asking at all of these events that I go to this year is, you talk to customers, it's a choose your pick hybrid or multi-cloud world. But how do you live in that environment? You're absolutely, you know, customers, they're doing lots of SaaS, they're doing Amazon, they're doing things with Microsoft or Google. And if you just live in the data center, you're limiting where you're going to play. If you're just, you know, the public cloud is obviously lots of growth. Nutanix is trying to fit in all these other environments. As they said, many people, when they first saw them, was like, oh, well they sell you an appliance that goes in your data center. That's not all that interesting. They're positioning themselves as enterprise cloud. What do you take? The message, you know, they said, you know, hyperconverge was kind of the baseline. But I don't think I even heard that word in the keynote this morning. It's now cloud. So. Yeah, enterprise cloud, which isn't a tag I'm particularly fond of, I must admit. But you can see what the appeal is, right? I mean, people are going to build these, they're going to have these data centers on-premise. They're going to have private clouds. They're going to have public clouds. They're going to go for data center co-location. And what you really need is a layer, a management layer that sits over that. So I think what they're building is something that analogous to the systems management frameworks that we saw back in the day for the multi-cloud era. And really, that adds such another arrow to the quiver. And that's why I say, you know, you look at the stock price and so on, and you kind of wonder whether the underpriced, in a way, you know, or whether people realize quite what the power they potentially yield is, you know, obviously they're going to go up again. Some of the world's largest organizations. But I think it's going to be an extraordinarily ambitious and bullish play. Yeah, absolutely. I think it's a really fascinating story. Yeah, well, top-line revenue, Nutanix Now, sitting right around a billion dollars on an annual basis. And from a market cap, talk about the stocks undervalued, there's still over four billion dollars in revenue. Kind of a, you know, if you look at a similar compare company that, you know, pure storage, Nutanix Now has about the same revenue, but, you know, higher market caps. So, you know, they're doing okay, but as they are trying to emphasize, and I think your point, and I would agree with you, it is early still. This is not the final Nutanix, the cloud play at the DC show, made a big announcement with Google, and starting to see some of that come to fruition here at the show, and a big push of theirs is their calm. Calm really is that layer that's going to live in the multi-cloud. It's still, most customers haven't touched it, or have really seen more than kind of some slides and demo. I did talk to a couple of customers already that have used it, and at least the early customers, of course, heavily involved. It's sort of a little bit self-selecting when you come to a event like this, but excited about how that is, you know, can be that layer that spans between the, you know, my various environments, whether that be my core, the public cloud, or potentially even the edge. They did an example in the keynote of an oil and gas going out to the rigs. So, you know, you think that Nutanix, you know, if we look two years from now, when I think multi-cloud is Nutanix, a company that comes to mind. Absolutely. I've just thought of this. So tell me if you like it or not, but they've kind of gone from stack to pack, okay? So Hyperconvergence was the play where you would conflate compute, networking, storage, et cetera. And really this combination of Prism, Acropolis, and Calm is a whole other level. And you know, again, they didn't really hammer it with the audience today, but they're moving to also very much a software-centric view of the world. You know, and that was always the question of people like me would ask of them, hey, why do you bother having appliances? Why do you have the hardware cell when, you know, software is the high margin kind of business in technology and software is eating the world, as Mark Andreessen said. And now I think they're really pivoting towards being a very much a software-centric company and flying the flag for that. You know, and I think that whole combination of management layers, of virtualization, of orchestration that they have is exactly what the sweet spot is in the future of enterprise software management. Yeah, I've heard some companies talk about the new stack and you took their products in PAC. Did you see what I did? I do, I think maybe the marketing organization, you know, give you a call, so you can see if they can leverage that. 500 bucks. So, you know, we've got two days of the show coming on here. Absolutely the kind of cloud story is one that I'm looking to tease apart and talk to the customers. As I said, I already had a chance to talk to some customers and it's very much a spectrum. You talk to some customers, especially here in Europe, you go to Germany and it's like, well, you know, governance regulation. You know, public cloud might not be something that they can do because we have to dig into it. As opposed to there's a customer giving a presentation today that very much they said everything was going to be public cloud, but they found even when they tried to put everything either in SaaS or like infrastructure as a service with Amazon, there were certain things that, oh, well, in certain countries, I just don't have the networking or it was going to be too expensive, so I need to put something in my own data center and that's where Nutanix have been a fit for them. So it's that good story. As I said, where's the center? And Nutanix being a software play, it's not about, oh, I have to sell, you know, thousands and millions of boxes. And even I've read financial reports that there's been hints from Nutanix that you've said why do they offer the appliance as well, maybe in the future, they won't, it will be through a partner and they'll do that, you need to qualify it, but absolutely position themselves, they are the enterprise software company is what they want to play. Infrastructure is a piece of it. But yeah. You're absolutely right. I mean, we've both been around the blog a few times when I started writing about this business, people used to say, well, mainframes, they're the dinosaurs, they're about to fall off the edge of a cliff. People still buying a lot of mainframes now. You look at IBM's revenue sheet, a lot of that's mainframe centric. So I think you're absolutely right. People are going to persist putting stuff close to the vest in internal data centers and they're going to selectively source in various different types of cloud. And you're right, governance is a big one. Over here in Europe, GDPR is the thing that scares all the CIOs and CEOs for that matter, witless, you know. So they're all terrified of that one, PSD2 and payments. You know, so when you have these regulatory landscapes, you know, there's a tendency to be very cautious, very calm and keep it behind the firewall. And you know, I think probably as long as I live, God willing, you know, we're going to see this combination of deployment models. Yeah, GDPR, absolutely, something we're going to be talking about. Nutanix actually has a couple of experts here talking to customers as to how they play into it because that's a question I've had for Nutanix is, okay, they have kind of their core focus, but as they start to go into adjacencies, you know, we see companies all the time, all right, I reach a certain level and then how do I get a little bit further and how do I have a reason to play into those environments? You know, Nutanix has a push into IoT. Nutanix is not the first company that I think of it. You know, they're, they don't make sensors, they're not a GE, even, you know, Hatachi Vantara has arms that play there. So, you know, Satya Vagani, they've got a small team working on that. So you want a company of Nutanix size to start right poking out, but where will they be successful and where will they gain traction? Anything catching your eye or interest from Nutanix as they go kind of beyond, you know, kind of the core kind of infrastructure stuff? I think it's our management layer. You know, very similar, I guess, VMware. You know, VMware initially was known for the hypervisor and then later on they were really tooling around that to become the control pane, you know, the command center of the data center. That's where I see them. You know, frankly, Stu, I'd be pretty worried if they'd made a lot of noise on, I don't know, virtual reality, augmented reality, internet of things, you know. I think they, to a certain extent, companies still have to stick to their knitting and this is a company that's very much geared around being the 21st century data center, Nexus. And for me, that's where the real value is and that is a multi, multi, multi billion dollar segment in its own right. Yeah, big question I have this week is always, you know, what are the relationships that are going to help Nutanix, you know, move further? One that we always look at is the Dell relationship, Dell's their largest partner, but also their largest competitor between the VxRail that they're doing, all the V sand pieces. Interest C, IBM bomb on stage. Power announcement is one that I don't think a lot of people really understand how that fits. You know, Bob Picciano was talking about AI and all of those pieces. Of course, you know, Lenovo, another hardware partner. So, you know, what are the partners that are going to drive them? Which are the, you know, what's the headwinds? What are the tailwinds that they go? Anything from the partner standpoint that you're looking into? Well, one of the ways, you know, I guess we all try to judge companies is by the company they keep. And they've got some nice partners. As you say, it's a complicated one. There's a lot of co-optition and frenemy type stuff kind of. It's a bit like a Game of Thrones type complexity of scenario there, you know. Do behind the scenes is Dell telling its sales guys to sell this rather than this. And what do they do to objection handling and are they going to eventually try and stage up new tonics? I don't know. I think my feeling is now companies are mature enough that if they can get significant revenues and please the customer, then that's probably the way to go. And you know, those are big, big names. And those are companies that you might think would have a history of wanting to do their own thing and go their own way. But then they're not, they're going with new tonics because, you know, it adds a USP, adds some unique selling point and it's a high quality product. And the customer's a very happy, very high net promoter score, which was an interesting little aspect, you know, 90 plus year after year, clogging it up. You speak to the customers here, they're a happy crowd. You know, you can't say that at every enterprise IT conference, I promise you. Yeah, absolutely. It's the, you know, the channel partners and the customers. Every single one of these events I've come to as one's a little bit self-selecting, but the people are super excited, digging into it. All right, Martin, want to give you the final word, things you're looking into, any kind of undercurrent that we should be aware of, you know, what should new tonics be concerned about or people that are looking at it? The one thing I would say that would be a kind of a risk factor if you are saying you're reporting into the financial markets and so on is, you know, as I said, they're really up against some of the world's largest organizations here. You know, there's a lot of very, very big companies with skin in the game. And you know, it depends. They could flip and get much more aggressive. They could decide to go their own way. They could make strategic acquisitions. We saw HPE buying Simplivity. And maybe that would be an interesting turn in the market. But I think they're set fair for quite a while now. I think they've become part of the data center landscape rather than the disruptor. I think they're now part of the status quo in a good way anyway. Yeah, last year they made, you know, it was one or two small software acquisitions. I think that's where we would expect new tonics to make those buy. All right, well, Martin Veach, really appreciate you helping me kick off. We've got two days of coverage here at the Acropolis in Nice, France. Be sure to stay with us. Have the executives on, customers and the partners. I'm Stu Miniman, here with Martin. Thank you so much for watching theCUBE.