 Live from San Francisco, it's the Cube. Covering Oracle Open World 2016, brought to you by Oracle. Now, here's your host, John Furrier and Peter Burris. Okay, welcome back everyone. We are here live in San Francisco for Oracle Open World 2016 flagship program. We go out to the events and extract the sales of noise. I'm here with my co-host this week, Peter Burris, head of research at Wikibon.com and also SiliconANGLE Media and our next guest is Vinnie Marchandani who is a distinguished analyst but also a award-winning author and his new book, Silicon Collar, we're going to talk about. Check it out. He really talks about the future of work and kind of demystifies this notion that everyone's going to be automated away. We're going to get to that. But Vinnie, welcome back to the Cube. Great to see you. Thanks for having me. Peter, good to meet you. So we're kicking off Oracle Open World Day Three, 25 interviews in the books here in the Cube. Your take, you've been wandering the floor, you've been talking to people, you've been attending sessions. What's your take on Oracle this year? What's your thoughts? So a couple of threads, right? The application thread, which I cover quite a bit, I cover SAP in four and so on. And nice to see the adaptive intelligent apps, you know, their version of artificial intelligence brought to transaction systems, right? That's nice to see them. Still very early. We got some early glimpses at it. It'll take them probably a year or a half to flesh all the detail out. Their blue guy acquisition allows them to be slightly ahead of the curve when it comes to consumer marketing data, by when it comes to HR, financials and so on. Still a while before their machines have enough data to be able to learn, right? So that's one positive from the application side. The other positive from the application side is because they have such a broad range of applications now, I'm starting to see their legacy customers, people SAP, JD Edwards, et cetera, say, ooh, I could finally look at moving a lot of stuff into the cloud. That's been a hesitation point for a number of them because they say, I can only move financials or I can only move HR. Now they can look at a much broader portfolio of applications to the cloud. So that's another slight inflection point I saw here. And you'll see that accelerating the next few years. So the timing of this all-install base, the acquisitions as the Oracle, does a lot of acquisitions, you know, people SAP, JD, or something like that. Most of them have stayed put in their legacy on-premise environments, right? Now they have a chance to start to look at migrating a lot of their footprint rather than just a point solution. So you see this as a catalyst, as an opportunity for them, as a catalyst for them to look at a new direction to kind of go to the next level with their preexisting conditions, if you will. Absolutely, absolutely. And you know, I see there are times when you feel like Oracle wants to just keep looking the maintenance base. I'm starting to see signs as they're saying, hey, it is better for me to migrate this maintenance base into the cloud. And you know, there's a different set of economics with that. And clearly on the infrastructure side, I mean, you saw the attention they've been paying to Amazon this week. I see it slightly differently. You know, they're going after the sexy part of what Amazon is doing. Amazon goes after the new developer. Oracle has an opportunity within its legacy customer base. You know, every people's self-customer has somebody hosting it, every civil customer has somebody hosting it, every one of their acquisitions has somebody hosting it. It's not sexy, but moving them into the cloud infrastructure, you know, saving them 15, 20, 25% is not a bad business. I don't see Oracle as focused on that. They're going after the Amazon market, which is new developers, right? Do you think the Amazon as a red herring, though, like it's just a way to kind of get the attention for that potential install base? So kind of like, because depositioning Amazon gives Oracle a way to say, hey, don't look there, but move your stuff over, or is it a real threat to them? It's smart marketing, right? You always, it's the Avis strategy, right? You point towards a leader and be associated to the leader. So more and more oracles talking about Amazon, they're talking about Salesforce, they're talking about Workday, they're not talking about SAP, IBM, HP anymore, right? So it's- Or even really Microsoft that much. Yes, exactly. Which is probably, longer term, might even be a bigger threat. With Azure, yeah, absolutely. Especially if you come out from an applications perspective. Yes and no. Microsoft's been inconsistent on the enterprise apps side. Clearly they're desktop, they own the app space. So infrastructure-wise, interesting where Oracle will be positioned. If they want to really go after Amazon, I see them having to make significant capex investments. You know, if you look at, I interviewed Microsoft in 2010 for one of our books. They had already spent billions on the Azure data centers, right? If you look at where Amazon's invested in the last few years, it's been billions. Oracle has not. Well, Microsoft has their own needs too. They've had a big web presence they've had. Obviously, they're searching new Bing, Office 365, Skype they've bought. So they have a lot of critical infrastructure already kind of in that cloud, kind of cloud positioning. But you brought up the competition, and I want to ask you about that, because last year we saw the beginning of Larry Ellison and Mark Herd clearly trying to consolidate the messaging around cloud. So like, all the other stuff is getting there, have to do all their messaging on their own. But really been muted, if you will, by the corporate mandate of cloud, cloud, cloud, even here, not a lot of big data, and all these other stuff. They get some key notes, but it's all about the cloud. And also Larry said, oh, we have new competitors. We don't only talk about IBM and SAP, but they're still competitors, because they're out there. He's just trying to shift the game to Salesforce Workday and now Amazon. Your thoughts on SAP? Obviously, you covered them pretty deeply. They have the Hauna Cloud. You have other existing competitors. Like IBM certainly would disagree. And now you've got Dell Technologies, we'll have Dave Donatelli on shortly, grill him about that. A lot of multiple fronts with Oracle, but they're old competitors. Your thoughts on how old are they? You know, if you look at all the senior citizens, if you will, the SAPs, the IBMs, the HPs, and so on, and Dells, and so on. I think Oracle, frankly, has done a much better job positioning itself for the next generation. I mean, if I look at SAP, you know, I've covered them quite a bit. Cloud applications, only the acquired ones have any traction. They're internally built as for HANA and business by design. Really haven't had much traction at all. Yeah, and Hauna Cloud was late to the game, but they're trying to get Hauna Cloud back into that, you know, what the Apple deal was interesting. They're trying to be there. Is that just paper press release or? Any time they're talking about cloud, I look at their CapEx spend. SAP's data centers are puny and primitive at this point. So if they want to be a true cloud competitor, you got to think like Google, you got to think like Facebook, you got to think like Microsoft. It picks a lot of investment in the... So you don't think their partnership with AWS is going to amount to much? You know, in the end, they'll have to start investing on their own, not just buying capacity, right? So the way that I would just, let me ask this question that I would look at it is, what are the paths forward for the customer and which are more or less viable? Certainly agree that Oracle's paths forward for customers that they've articulated this week are attractive. You can see customers saying, okay, I'm going to go that way. And we'll see how SAP, the paths forwards that it has, it's trying to rely a little bit more on partnerships and whatnot, and it's clearly trying to intercept the Oracle database. But at the end of the day, it does come back to whether or not the paths forward are viable. Wouldn't you say so? Absolutely, and I think in the enterprise space, progress is measured in decades, not years, right? So Oracle, even though people made Futter Fusion, it's taken a decade to become real. That does, at this point now, they've had their wounds and they're ready now, right? SAP has just started that process with S4HANA last year, right? So it's going to take them a while to mature. IBM, if you look at their cloud infrastructure, I mean, it's a two year investment, right? So in that sense, Oracle does have a slight edge, slight lead over the others. In many respects, I know you're going to show the book. We're looking at it and I want to get your thought on this, does it, Oracle's presence with its partners and the ecosystem here is interesting because it begs the question, is Oracle going to be able to ride that ecosystem down into the lower end faster than the enterprise gets upset with Oracle's pricing and contracting approaches? And so what do you think? Is Oracle going to be able to ride down with the ecosystem faster than Amazon can come up because of disaffection? You know, Oracle's always had an interesting relationship with its partners. They compete with them. I don't think they've been as dependent as someone like SAP, which has, I've written a couple of books on that. It's a $300 billion ecosystem around a $30 billion venture. I mean, they have been very partner centric, almost too much sort at the expense of the customer. Oracle's always been a little bit push and shove with their partners. Partners don't necessarily like that, but from a customer perspective, that's actually a better model is where you don't just, you know, invite partners to a party and customer pays for it. So, I don't know if I answered your question. No, you do. I mean, let's talk about your book, Silicon Collar. I love the name, it's got Silicon in it, Silicon Angle. We're calling the market with the content. So I want to talk about this. First of all, it's a great book. You should, everyone should get it. It's a deep book about tech. So it's been talked a lot about the technology industry, but it puts a lens from a future of work standpoint. And it covers a lot of the dynamics we've been talking about on theCUBE all week, which is the role of executives, the role of the company in how they form themselves in the future and demystifies this notion that AI and bots are going to automate away the world. But there's an interesting part here I opened up and want to share. The battle for technology budgets is a section of a year. And it talks about the CIO and I bring that up because we talk about budgets because the buyers of Oracle and other big company selling cloud and other things are constantly looking at how they can get more help from the CEO CFO because of the mandate to digitize their business. So the digital digitization, the digital transformation is now mandated, the CIO now has to expand their role and the budgeting and or allocation of resources is going to change. So I want to get your thoughts on that and put that in context to the book, what you're finding, the personnel issues, the HR issues around how jobs will shift. Now I said it's a zero sum game, that's my position. I think things will shift around. Yeah, people will lose their job here and there, but I think it will shift somewhere else. Your thoughts? So the reason I called it Silicon Collar was I interviewed about 50 companies, different work settings, white collar, blue collar, brown collar, UPS and so on. And I said, every job is being influenced by technology. We're not white, blue, red collar workers, we're all Silicon Collar workers. So that was the fun part of the book. So I interviewed the Golden State Warriors about how variables and data are changing the coach's job and the player's job. I interviewed BP in terms of how they're using drones in remote infrastructure, remote pipelines and robotic crawlers on their rigs and so on. I interviewed many of children's hospital here about how robotic pharmacies and robotic surgeries are changing the physician's job and how cognitive computing, the Watson type stuff is changing medicine, transcription's changing medicine. So when I look at 50 different work settings, I covered every kind of automation thing you can think of, everything from drones to exoskeletons to machine learning to variables and so on, exciting stuff. In background though, as I was doing all these interviews, I was reading all these pessimistic reports, right? There's a couple of Oxford professors who said 47% of the US workforce is susceptible to automation. Gartner, my former employer, said by 2025, a third of the workforce will be replaced by smart software, smart machines, so on and so forth. I mean, these are big numbers, right? And number of authors, number of, a lot of pessimism in the market. And I said, why, why, why, all these practitioners I'm talking to, I'm not talking about job losses, I'm talking about improved productivity, improved customer satisfaction and so on. Where are these getting all this pessimistic data? And what I found was most of them are looking at short-term evolution curves. And it's scary, right? You look at the way machines are growing, you can't feel scared. I looked at evolution over 100 years and I found example after example of how society slows down adoption of technology, right? So I looked at the grocery industry. The UPC code was first branded in 1952, for 20 years nothing really happened. In the mid-70s grocery stores started to adopt UPC scanners. Interestingly what happened was it made inventory control much more accurate. So it allowed stores to now say, hey, Kellogg, I'll store 100 of your skews, I could only store five before. Campbell, give me more soups, more variety. So skews exploded, sales exploded, grocery jobs actually went up, right? So I looked at the banking industry. The predecessor of the ATM was branded in 1960. And by the 80s, you know, ATMs were everywhere and in the last 10 years we've been moving to mobile banking. Well, we still had just in this country 90,000 matchbacks that still hire half a million tellers and other staff. And 60 years ago we would have said that job would be gone, half a million jobs still there. So where's the impact to the customer? Because now all this change is going to certainly change the value chains and how the configuration of the business models to personnel, to resources. Certainly there's going to be great software out there. We see that coming. Impact, whose lap does this fall on? Or is everyone's responsibility at this point? What was interesting was I don't see enough. This is something HR should be all over. Because it's a form of talent, right? Machines are another form of talent. And they're not paying much attention. So I think most businesses will need an automation executive who can look at different business processes in a very different way than they could 15, 20 years ago. 15, 20 years ago they should look at process and say, I can re-engineer this part, this part. Now they can do a lot more dramatic impact. Not just for cost, but customer satisfaction. I have an example of Pixar in the book. Zootopia, right there. You think with all the computer generated imagery the jobs would be gone. Zootopia had, if you look at the credits, 500 animators, sound technicians, and so on in the credits. And you could think, in the credits, how much more does Pixar and Disney animation have? So in their case, it wasn't anything but cost. It was about making a fantastic product. In Zootopia, every one of the characters had individual hair. So they could show how light reflects on every strand of hair, how wind moves through every strand of hair. I guess how many haired the giraffe at 9 million. So in their case, machines are helping make the product that way better. So it's not always about cost savings or efficiency. It's about how can I make a better product? How can I make a better product? I saw when a digital presentation last night as part of the cloud storage forum and the amount of new people working on both creative and pipelining of the workflow for these films and jobs and the data centers are being built using the storage, ZFS storage. Pretty amazing. I know you got to catch a flight. Thank you for spending the time. Great book. Finally, someone coming out with a positive view of this great revolution we're living through. This new class called the Silicon Collar. No more white collars, no more blue collars. It's going to be a flattening of the classes. Hopefully people can make money and buy a home and we don't go into a depression with the current situation. You would look better in gold than this. I'm a Silicon Collar here at Silicon Angle Media. Get this book. It's a great book. It's a good read. It's a deep read. So if you're really interested in the future and the positive impact of software eating the world, get Silicon Collar. It's a great book by Vinnie Merchandani. Thanks for sharing your book. Great to see you again. He knows what he's talking about. Former analyst, great person. Read the book, Silicon Collar. Be right back with more live coverage here at Oracle Open World after this short break.