 Okay, we're back here live at HP Discover in Germany. We're at the CUBE's Silicon Angles flagship program. We're out to the advanced extract the city from the noise. John Furrier, the founder of Silicon Angle, and I'm joined by my co-host. I'm Dave Vellante of wikibon.org, and we're here with CUBE alum, Stephen DeWitt, who's the senior vice president of the enterprise marketing operation. Formerly, you were doing enterprise group, told us off camera. It's now the whole enterprise. So that comprises enterprise group, the software services as well. That's correct. Oh, fantastic. Well, first of all, congratulations. And second of all, smart move by HP. We were just talking in our editorial segment about the messaging, you know, and I think that's going to help a lot. So anyway, welcome back. It's great to be here, and I agree with you. You know, at the end of the day, we're very uniquely positioned. We are a portfolio company. We operate from the client to the data center. We provide services from the client environment to the data center environment. We provide rich services around, you know, application transformation around big data. It's critical for us to be able to take the story of HP across that continuum and apply it to our customer's problem set. And we're doing a much better job of that. Stephen, one of the things that we've been covering on silkenangle.com is obviously the consumer web and that is kind of going through with people talking about all the bubbles bursting and not a lot of more Twitter's out there and VC funding and kind of all that entrepreneurship activity. And so that's being discussed, but the enterprise is hot. Okay, so right now, all the build out and real economic boom is happening on the enterprise side. Big data, obviously you mentioned, obviously on the infrastructure side, a lot of transformation with hardware and software. So share with us and share with the audience HP's enterprise business, because as you guys are kind of putting this together over the past 12 months and then going forward, that's taking a different shape. So could you just share with the folks out there how HP's organized and how you view the enterprise? Because HP has a lot of moving parts. So just share kind of how, what is the enterprise group at HP and what does that entail? Well, you know, I think we're entering perhaps the most intense decade that we've ever experienced. And look, we've gone through some pretty extraordinary things over the last couple of decades, but in the 10 years that follow us, there are going to be massive inflections. First, let's start with the cloud. You know, our industry historically has been designed by, or defined by siloed technologies, storage, networking, compute, and those have been delivered historically through denominations and sold to end customers on a price-proport metrics or a compute, number of cores, number of processors, or from a storage perspective, this is how you deliver storage arrays. All of that is evolving dramatically. And by the end of the decade, all of those numerators and denominators will be wiped from the face of the earth. That's one major change that's happening. And by the way, that has huge customer ramifications because CapEx is turning into OPEX. And for various businesses, you know, we have Jeffrey Katzenberg here from DreamWorks. You know, Jeffrey's going to talk a lot about the role of Hewlett-Packard in terms of our technology across their enterprise. You know, the simple reality is it takes five years for them to build a movie. And inside of that five years, it's very difficult for them to go to their stakeholder community and say, I'm going to sink tens of millions of dollars of CapEx on something I don't know what the outcome's going to be. So they want a more variable-ized model. So do the banks, so do the airlines, so does every transportation company. So there is a huge sea change in the way technology is delivered and consumed. That's one big block. There's another major block happening in terms of what's happening underneath the covers of technology. A lot of inventions are coming. We're pioneering things like memrists or technology, photonics, which fundamentally transform the definition of a system. So there are significant technology, milestones that are coming. There are business operating models that are changing. I think this plays very well into HP's strategy of being a continuum provider of IT solutions. I think it differentiates us materially from the rest of the industry. So we have organized our company along that continuum in order to deliver that integrated value to our customer. You're seeing here at the show 1HP. We are driving that integration between the technology so the end customers don't have to deal with that complexity. So we'd say to say that consumerization of IT has been kind of the punchline is where it kind of kicks that term around. Really is happening. Look, I think the human experience and information technology have melded. You know, by the end of the decade, you're going to have more than six billion people online. You're going to have 30 billion devices that are held in the hands of the human population. You know, we're moving to a world where public sector services, educational services, and everything in the business environment is going to be delivered as an app. It's going to be delivered in a way that's context sensitive. There's no more complexity around operating systems and Moore's law type evolutionary trends. All of that is gone. Technology, content, and the human experience have all melded. So for the customers that are out there, I'll say everyone's looking at the transformation of their business model. So we're seeing a lot of that activity. The business models of the customers are changing. You're seeing big data with instrumentation of their businesses, analytics. It's driving a whole another level of modernization at the business model level. And then at the infrastructure level, you have software defined blank, you know, is happening at a large scale. So a lot of customers are trying to evaluate these seismic changes you mentioned. So how do you view and how do you plan to communicate to those customers about HP? You know, because it's complicated, but they want trust, they want to cross that bridge with HP that either been with HP or they're evaluating HP given all the context in the marketplace around HP today. You guys have a good portfolio. Donna Telly was talking about it, but you have to package it. So how do you think about that? And as you put that high level messaging around that story, what is that story? Yeah, that's an excellent question. And actually I want to nail one of the things that you put in because I missed it and that was software defined networks or software defined storage or software defined servers. You know, the simple reality here is existing technology business models, like one of our major competitors in the networking space that begins with a C, I'll leave it at that. One could argue that inside of the decade as I was just sharing, their entire operating model is wiped off the face of the planet. Because if you think of the value proposition that's delivered today in the lower levels of infrastructure, all of that is going to be orchestrated through a new control plane that's emerging in the industry. We're driving that. You know, a handful of years ago we birth converged infrastructure and the industry followed. Software defined networking, you know, together with partners like VMware and others we are driving the heck out of this, it means material change for the end customer. So your question about how you package it all together, I think the best aspect to where we're going versus where we've been is that the packaging is around what people are trying to accomplish. You know, go back to what I was just sharing in terms of where we'll be by the end of the decade, 30 billion devices, you know, a trillion sensor networks, et cetera. Well, inside of that universe, every single day of the week, there'll be more than half a trillion e-commerce transactions that happen. And if you're a business, no matter what your business is, no matter where you are on the globe, you want to be able to drive traffic, drive conversion, bring your goods and services, differentiate, and you have to move at the pace of business, not the historical pace of IT. So what you'll see in the stories that we tell around HP is matching the business requirements or matching IT to the business requirements of today, both the economic reality of today, the fact that we're in a borderless world and moving to a borderless world. You got to compete across every geography and do that in a way that's simple and aligned to the human experience. Steven, you've talked about differentiation before and you gave a lot of points of differentiation that related to your portfolio, your technology, your global presence. I wonder if you can help summarize that because I look at companies like IBM, companies like Oracle, they, I put them in a class obviously of HP. You guys are all large. Oracle very clearly has its differentiation strategy, Oracle database and software. IBM has jettisoned a lot of its consumer-oriented business. How do you simply sum up HP's differentiation in terms that are meaningful for the customer? I think we're one of the few companies on the planet that can look a customer in the eye very directly and say the following. First, we invest an extraordinary billions of dollars in R&D across the IT continuum. If you're an end customer, you have to look across the IT continuum in order to accomplish whatever it is that you do. So the fact that we invest across that curve gives customers the confidence that they can leverage our R&D better. That's one side of it. I think there are a couple other axes that we also are uniquely positioned. First, and let's never lose sight of the fact that the axi of being best in class matters. You know, being a pioneer, being committed in each of the core aspects of IT, being committed to IP generation, IP innovation, and IP leadership on a global scale is a huge benefit to the end customer. And we operate very heavily on that axis. We do it through both our product teams as well as through our labs infrastructure. Another axis that very much differentiates us against the peer group that you just talked about is that you've got the best in class axes, but you also have the converged axes. Technology operates with other pieces of technology. And if you're a company that just talks about, hey, I got my best in class widget, you're losing the reality of that widget and the widget that's next to it have to operate well, have to shelter the end user from operational cost and complexity. We do that exceptionally well. That's where convergence is all about. That's why we stress that over and over. Customer benefits, best in class, and across the continuum, we do all of that. How about openness? I think generally people give you higher marks than some of those other two that I mentioned and maybe some of the others in the industry. Is that, can that be a differentiator? Is that a differentiator with customers? I can't even imagine a customer that in 2012, 2013, or at any point in the future that would sucker themselves into a proprietary architecture. You just wouldn't do it. And that's because not one company can't do it all and every business has their own cadence, has their own set of economics, has their own need to invest in innovation at their own pace. Again, go back to DreamWorks. Jeffrey needed investments into color, into rendering, into cloud. And in order for him to go out to the industry as a whole and get all that together, he needed partners that encourage partners to come in and build on top of the platform, take cloud. You know, everybody in the world is talking about cloud right now. Our approach to cloud is to have a consistent architecture from traditional private cloud build out to hybrid environments or managed environments to our public cloud, which we've made some big announcements about over the last handful of months. A unified architecture that's open, built on open source, open standards, and an open philosophy of partnering. You know, HP's been about this for a long time. It's part of the reason why customers love doing business with HP. We do a tremendous amount of research with our customers we hear over and over again. That is one of the defining characteristics that separates HP from the IBMs and the Oracles. Steven, I want to ask you something about, I talked with Donna Telly about, Dave and I just recently, we talked about hardware and I wrote a blog post yesterday about, it's not about the hardware, it's about the software, but hardware's not going away. No question. Because you need more cores to process all that big data. You need more cores to deliver mobile apps, et cetera, et cetera, he said, quote, hardware's just a delivery software's the key. So I want to build on that. I wrote a post yesterday talking about software-defined infrastructure. That's really kind of how I see this market. So we just released a research report called Software-Led Infrastructure, which talks about the modernization of converged infrastructure. As you guys said, you built that out, everyone followed. So I want to read you what I wrote here and I want you to comment on it. I wrote yesterday in my blog post, this is in context of the storage announcement. The combination of software-defined infrastructure and big data will drive a mega shift to a modern data center and by result, the new modern business. My prediction is that we will be, this will be the biggest shift in the enterprise market since the computing and networking explosion in the late 80s and early 90s. So you've been there. So one, comment on that quote and tell me how this next explosion that's happening right now and what is it going to mean for the market? And the reason why I ask the question is I don't want to talk about HP per se. There's a lot of people in the marketplace on Wall Street and in business who don't understand the magnitude of the wealth creation that's about to happen from startups to HP and ultimately to the customers. So one, do you agree with the quote? And two, share your color on as an industry participant over those years and now. Yeah, it's depressing that I've been an industry participant since the early 80s, but anyway. Do you remember the TCPIP? No, no question about it. And I've also been very fortunate to be with a lot of companies at interesting inflection points and have built a number of companies through the years. I agree completely with your quote. And in fact, I think probably the biggest or the seminal change is it's a world about apps and the life cycle of apps and the speed of apps and the human consumption of apps versus I'm following an IT evolutionary curve and I'm hoping that I can build things on. The pyramid's been inverted. It is all about the apps now. It is all about the experience. Now we've seen a lot of great things over the last handful of years. We've certainly seen the massive transformation that came from the internet. We've seen e-commerce explode. We've seen the massive consumption of mobile devices. We've seen the elimination of binary compatibility which slowed down the process to things. Companies now can literally innovate at the speed of light and IT has to be able to follow that path. So talk about that modern data center because the modernization of the data center really is a huge, there's a lot of legacy there. Obviously we're seeing a lot of different approaches. Companies like Facebook are building their own stuff and obviously Google is Google and Amazon is now kind of following Google's path but that's just kind of examples of some unique straight data points. But the big bank, you mentioned financial transactions, what's that data center going to look like? Because that really seems to be the next explosion. Well, it's interesting, the data center doesn't have to look like it did in the past. And you're so right, think about it. Think when you look on TV, businesses have become marketing businesses. If you're a bank, if you're an insurance company, I mean, do you ever turn on the TV and within an hour you haven't seen 20 insurance ads on TV? All of these industries are changing. Their economics are changing. Their profitability construct is changing. And when you think about all of that, what IT has to do is IT has to become less and less visible, less friction, less cost associated with the orchestration of IT. You know, IT, you know, think about it. When you turn your tap on to get water, you don't worry about all that infrastructure that sits there that delivers that. Business now is about, I want to deliver this app, I want to deliver this capability, and I want to deliver it now. And so when I think in the back end, well, what kind of computing infrastructure do I need? Do I need a high density environment? Do I need more of a robust, big memory, non-blocking architecture? You shouldn't have to worry about it. All of that should be delivered as a capability. An app has to have this reliability characteristics, this performance, this usability, and IT just needs to deliver. So you're basically saying it's the same game, just different world, apps and compute and infrastructure. Yeah. So final question, I know we're getting the hook here, next year, the next 12 months, what does it look like for you, for your current role as an HP? What's your objective, and what do you hope to accomplish over the next 12 months? Well, I think, you know, certainly from a marketing perspective, you know, wipe away the drama because fortunately most of that's in the rear view mirror and that really doesn't get to the heart of HP. I think it's important for us to, you know, much like IT has to simplify, we have to simplify the HP message. I think we need to provide a better platform for articulating and driving the value proposition of the continuum of solutions that we deliver. I think another key goal for us over the next handful of months is alignment with our partner base. You know, we've got great technology partners here that help complete the solutions that we build. We have great channel partners and bars and integrators that add that level of value, elegance, simplicity, and a compelling storyteller, a story told in a compelling fashion. You'll see that in this coming year. Okay, so if we do it at HP, heading up to marketing for HP Enterprise, the enterprise is hot, booming, a lot of value there, a lot of change, transformation, opportunities across the board from startups to companies changing business models. This is theCUBE. We'll be right back with our next guest after this short break.