 Live from Seattle, Washington, it's theCUBE. Covering DockerCon 2016, brought to you by Docker. Now, here are your hosts, John Furrier and Brian Graceley. Hello everyone and welcome to another special presentation of SiliconANGLE Media's theCUBE. We are here live for two days of wall-to-wall coverage in Seattle for DockerCon. DockerContin is all the madness in cloud and developers. I'm John Furrier, my co-host Brian Graceley for this show. And again, we've been on the spring tour, wall-to-wall events, covering over 100 events this year. Look for theCUBE in the moment, in the now, finding all the action. Docker with big funding, Greylock and all their syndicates, Brian Graceley and I are going to break it all down. Brian Docker has a lot to do here at the show. Ecosystem is booming. The show feels like Amazon early days. Yeah, I know there's so many storylines going on this week. And you've got how fast Docker continues to grow. 75 people at their event two years ago, 4,000 here today. I think Ben Gallup said they had had four billion downloads of the Docker container. So really big numbers, big community numbers. Lot of new ecosystem players here. We're going to interview a number of them this week. The ecosystems, friendly on one side, they're competitive on the other side. And there's so many storylines this week. It's going to be a lot of fun. Yeah, and one of the things I love about this open source community is we've been covering really since the beginning of open source, since theCUBE started from the Hadoop ecosystem, OpenStack, we saw that move. Now the digital transformations on the top of everyone's agenda. So there's a lot of pressure in this ecosystem. I can almost feel it kind of oozing on the floor to commercialize faster. There is more demand from customers to get stuff deployed that's cloud native and or legacy integration for real time development around data, around cloud. So there's pressure right now to put some meat on the bone. I want to get out of the speeds and feeds and talk about business outcome. Docker seems to be in a good position, but are they? Are they going to be commercializing, going for that business model or continue to nurture the ecosystem and hopefully find a home? What's your thoughts? Well, the big thing with Docker is always, you have to remember, are we talking about Docker the community or are we talking about Docker Inc? Docker the community has done a fantastic job of figuring out how do I make it easier developers? If I'm making it easier for developers, you're going to get more productivity. You're going to get more applications, more stuff's coming out there. Are they making money? That's the great question. We'll have to sort of ask the ecosystem this week. We'll talk to some of the executives this week. That part I think is still early days, but they're doing a lot of things. Again, to your point, help developers. How do I help developers? How do I make them go faster? How do I make them more productive? Am I going to get a new app in a car or am I trying to tie off some new way to get to a mainframe from mobile phone? That's all the things they're trying to figure out. It's interesting when I spoke with Jerry Chen before he made this big investment. It was his first investment in Greylock. Cube alumni, Jerry, we'll see you on Tuesday if you're watching. It's really interesting because Greylock just doesn't invest in me too companies. They want to invest in the next Amazon, the next big thing. They go big or go home, it's kind of their philosophy. So you look at Docker, it seems like on one hand they're groping to be that IT player. Be like VMware. You see him almost kind of testing the waters on a business model, which could take him down this road of a me too IT player. At the same time you have this explosion of cloud native where there's management, orchestration and security and identity. Yes. So it's almost like they're an innovator's dilemma. It's interesting to see what their moves are. What's your thought? Because they have to at some point take a turn. Are they IT, me too vendor? Kind of disrupting the incumbents? Or are they going to be game changing? It's a great question because they have tentacles in so many places here. I mean, they're kind of a cloud provider. They're kind of an IT provider. They're definitely following VMware's playbook which tremendously successful in the early days helping people transform their infrastructure, transform IT operations. That to me is one of the big questions is who's the buyer of Docker? Is it developers? Everyone talks about developers, the king makers but do they hold the coin? Do they hold the purse? We know IT operations and production holds the purse. I think they have a huge opportunity around security, around identity and all those things on the edge. They're trying to be involved in the core of people's applications. They're trying to be involved with networking and storage and being a cloud provider. And that's a lot of balls to keep up in the air. It gives them a lot of surface area for people to go after them. So I don't know so much if it's a me too thing. I think if it's more of a, can I execute on a few things really well or am I trying to do too many things? It's interesting. They have a couple of market forces that are, you could say tailwinds or headwinds depending on how you look at it. One is when Docker first came out and then the Docker ecosystem, Docker Inc, they really were non-threatening. They really were a galvanizing force, very similar to the Linux days around people getting around them. But then all of a sudden, the incumbents, you see VMware, you see IBM, CoreOS, Red Hat, even Amazon has a container as a service, Amazon Web Services. So in a way you have co-opetition or competitors, at the same time the market's softening on the financial side. You're seeing a lot of consolidation. LinkedIn just sold to Microsoft at $26 billion. So it's interesting. Docker Inc is really at this moment of truth. They've got to decide what they're going to be when they grow up because you could argue that an M&A opportunity could be right there for multiple billions of dollars between Microsoft and IBM for sure, maybe others. And then over the top, you got Google with Kubernetes putting the squeeze on the ecosystem. Your thoughts? Yeah, no, I tweeted it out this morning. There's probably at least a billion dollars in VC money floating around in containers. Docker's got probably a hundred and something million but you've got Pivotal just took 250. You've got people like Google, like AWS who obviously have a ton of money to go compete against them. We're seeing acquisitions. We recently saw Apprenda by Kismatic. They're in the Kubernetes space. So they don't own the market. They obviously have the most dominant brand in the container space. But you can see people like Google, AWS, Azure, being able to offer them as a service. They're not paying Docker anything to offer that service. So you're right. They got to figure out who they want to be. They got to figure out who their audience is. And right now I think it's still not completely clear where they're going with all that. So I want to read something here from an email I got, said, really love Wikibon's new digital business platform research agenda. And you just put out a piece behind the paywall for the Wikibon subscribers around emerging architectures for cloud native applications which you could also imply cloud native and integrating with legacy. So what is this new digital business platform research that you and Wikibon team is working on? Yeah, in the simplest terms is, a lot of legacy IT was focused on trying to make the business productive. The backend feedback and functionality, things that their customers didn't see. Everything around this new digital business is about things that their customers are going to see. So applications facing their customers. How do I collect data from those applications? Use feedback loops within the business. Let the product manager see what's happening. Let the executive see what's happening. But doing all this in real time focused on trying to change their markets changes. So we see the automotive industry now is thinking about their vehicles as technology. We're seeing healthcare, we're seeing agriculture, we're seeing manufacturing. They're all trying to figure out, as I touch my customer, how do I use data in real time to do that? And so that's really what this whole digital business platform thing's been about. So Rob Hoef, our editor at SiliconANGLE and I were talking, he says a lot of the stuff we talk about here at the shows are very geeky. Kubernetes, microservices, a lot of stuff under the hood that you have in your report, you detail out quite well, really is very important. So if you could just give the one-on-one on what Kubernetes and microservices are in relation to why it's important. Yeah, the simplest way to think about it is when you, in today's world, you have a lot of unknown. So you don't know if you're going to be the next Instagram, you're going to be the next what app, you're going to be the next whatever. In essence, what these technologies do is they say, you have an application, you'd like it to scale up or scale down based on how popular you're going to be. And you know what, I'd like the system to just take care of that for me. That's what these technologies do, whether you're talking about Docker and Swarm or we're talking about Kubernetes or anything else which has a funny name. They're really just there to say, let automation take care of scaling up and down, making them always available, and you just focus on building a great application. And if the market loves it, great, we'll scale up. If the market doesn't love it as much, it'll scale back down. Take all that, care of that automatically. Okay, so I got to ask you the question we always like to ask the chess board on this landscape. What's the battleground right now? Because you're looking at a lot of different areas. You and I were talking before we came on about identity, but also the announcements really kind of have the buzzwords, democratization of containers. Orchestration is another word we're constantly hearing more and more about as a really relevant piece. What does that mean and why is it important? Well, it's sort of inertia fighting innovation, right? So we know the inertia of IT, we know how much money is going into IT, whether that's Oracle spend or Cisco spend or EMC spend, whatever it is. The real question for the chess board is, how fast are we going to see new applications built? We see lots of startups kicking in all the time, but how fast is an enterprise going to build a new application? And if you're the company that can help them build it faster. Again, I go back to the car analogy, Ford trying to build things for the car, but no matter what that is, you're trying to help doctors. If you can be that company, that technology that helps a business leader go, I got a great idea and I want to execute it in software, you got a chance to win. Right now, there's tons of great technologies. It's does the enterprise yet have the appetite to go, I want to be a software developer, right? Unlike a startup who that's their bread and butter, the enterprises are still figuring out, that's the real friction as to whether or not all these folks are going to make tons of money or whether it's going to be a slow drip to them, making a little bit of money. So Docker Inc, which is powering the ecosystem, which is behind us, which is very open source oriented, they're not really land grabbing, but they have some really good talent, a lot of XVMware, I'll see Mariana at XVM. X Microsoft, XVMware, XVMware, Jerry Chen, we know Jerry very well. IT background, also very cloud oriented, but yet you start to see Hewlett Packard Enterprise, big announcement when we were at HP Discover in Vegas, IBM event we're covering here on Wednesday, they're gate crashing and bolting on an event on Wednesday, we'll be there covering it, these are big guys. So partnership is really, really key, so how does that alliance playbook look like? I mean, Microsoft really was good at that, Google's now learning IBM HP. Well, look, it's classic stuff. You partner with somebody like HP, that could be IBM, it could be Dell, you need a sales force, you need your technology embedded everywhere, make it easy as possible, that's exactly what made VMware get, grow as fast as it did. I mean, you look at some of the pieces Docker has, they now have a channel to help them get it out there in servers, so that's where they need to be. They have this registry and security technology, that's just like owning Active Directory in the Microsoft world, that's a crown jewel piece. Now they've got this scheduling technology very much like owning vCenter in the VMware space, they're starting to put together those really important control points, whether it's a distribution channel, security and authentication, how the system clusters itself. They're putting a lot of pieces in place, it's going to be really interesting to see if they can figure out how to monetize from that, but they've got a lot of the right pieces in place. So big news on the hashtag in our dashboard here, says Docker engine 1.12, now available with built-in container orchestration. What the hell does that mean? Well, at the simplest level, it says if I have an application that needs a bunch of containers, so think about any multi-point, multi-process application as a database, as a front end, whatever. Containers for a while were really hard, how do I network them? How do I find other containers? How do I, you know, all that service discovery stuff that used to be built into those big clunky enterprise service buses that Oracle and SAP would charge you millions of dollars for. The container people are trying to make that super simple and Docker just said, you know what? I didn't make it simple enough in the past, I now have to make it even simpler, I'm going to embed it into my technology. And so if you're a Docker customer, you go, this just made my life simpler. If you're a Docker ecosystem person, you just went, hold on, the co-optition between us maybe just got a little more feisty. What are you hearing in the hallways and in customers around Docker? I see this buzz there, HP is adopting it, and obviously that's a great move for HP, but it gives their customers confidence that the containerization, however that plays out, that they're going to have a hand in that, it seems like much more of a forward-looking deal, less specifics, we were trying to dig into it. But what are you hearing from people actually implementing this stuff? Or are they implementing this stuff? What's the progress bar? Are they implementing Docker and the IT in the cloud enterprises, the ops guys? Yeah, that's the big thing. So there was a whole slew of studies and surveys that came out last week. I tell you what, if you read them all independently, you were super bullish about Docker, you know, you heard crazy things like 75 to 90% of people have it in production, and then you'd read another one from the Cloud Foundry Foundation, they said, well, I don't need, you know, containers aren't important enough, they're not powerful enough. A lot of it's going to depend on where you want to be in the market to your bias. The basic things I'm hearing, developers love Docker. It makes it really easy to do what I do on my laptop and make it the same in production. So that's a developer's dream, and it's super simple to package up an application. So a lot of those dependencies that are complicated, they love that. The operations people, I think, this stuff is so new to them. This stuff has come on the scene in the last year, 18, 24 months, Docker beat the drum that they're the new VMware, and of course operations people love VMware, so what does this mean and my skills? That's the real divide. What do you mean the new VMware? Well, you know, and people wanted to make the argument, containers are going to replace VMs, and in some cases that makes sense, in other cases that's sort of not understanding the technology. But if you're an operations person, you have a VMware certification, you've been going to VMware for years, you know how to run it, you know what to do, and then somebody comes along and says, no, no, no, scrap all that, learn Docker. Well, I got to learn Linux, I got to learn all these funky new words, like Kubernetes or Swarm, I got to, I mean, the learning curve is massive, and when the developers are pounding on you and they're saying, get this stuff into production, you know, they're going, they're freaking out a little bit. So operationalizing sounds like a big issue. It's a big piece of it, that's why Docker made this announcement today, they said, you know what, embedding Swarm is an operational thing, it's got to be simpler, you got to make life simpler for the operations people. So that's where we're seeing a lot of effort on the Docker side because they realize if the operations people aren't on board, they're not going to put it in production, you know, they're going to- So it's got to be simple, it's got to be the TCO total cost of ownership, and the security's a big deal. Right, security's a big deal. Docker's done a great job around security, they've got a couple of people that they hired over from, I think they hired them from Square and from a couple of other companies that were really heavy in security. Because yeah, I mean, if you're letting your developers do anything they want, put anything they want in a container, Wild, Wild West, it could have malware in it. If you're an operations person, boy, you want it, you got to monitor it, you got to know if it's got, you know, is it secure, is it not secure? I got to have those tools built into my infrastructure, and that's what they're asking Docker to do. So are you seeing a tsunami of containers coming on the market? If you bring that premise forward, then it's easy to use for developers, and obviously potentially malware could be- Well, the tsunami comes if you're building new applications, because these are all built around new, well actually I take that back. Everybody here is now going, you know what, it works for any application, which of course is a land grab, you got to be able to get back into the legacy, but all the new stuff is going to be around new applications, and it becomes a matter of, is am I building more mobile applications, more IOT applications? You know, application development still takes a while, it doesn't happen a lot. What is Cloud Foundry fit in all this? Someone is maybe scratching their heads saying, okay, I hear Blue Mix of IBM, Pivotal's got something out there, they're developing some new stuff. Cloud Foundry is out, how does it all fit? Yeah, the simplest way to think about it is, I mean Docker began life as a pass, they were a platform as a service company, didn't necessarily pan out, they broke down the technology and said what can we do for developers? Cloud Foundry, what IBM Blue Mix does, what Pivotal does, is really what I call a more structured platform, so it gives you everything. You bring your code, it manages everything for you, it does monitoring, it does security, it does everything. Docker is a little more of what I call a composable platform. Developers bring what they like, but then operations has got some flexibility of what they want in there. So if you're the Cloud Foundry camp, you're basically saying, hey, you know what? All these things that Docker's trying to do, we've been doing that for multiple years, we've been making it simpler for you, don't buy into the hype, we've already got that for you. If you're in the Docker camp, you're going those guys are way too rigid, you don't want to go down that path, we used to do that in the past, it didn't work for us. There's a lot of consternation between those two camps. So VMware at last VMworld, Pat Gelsinger again, adopting the pro Docker rhetoric. Yeah, but Pat wants to keep it on the down low as long as he can. You think so? Absolutely. Well, again, the press loves saying, Docker's the new VMware, Docker's the new VMware, and Pat's going, whoa, whoa, whoa, hold on, we're not dead yet, we're still around, we're still vibrant. So he's sort of taking a wait and see approach. What about Microsoft Azure? Because we know Azure and VMware certainly competing and Azure's doing well. Azure's got a huge presence here. Azure has been sort of the, I don't know, they've been the corner, they've been the banner partner for Docker for the last year and a half. I mean, on the keynote stage, there's a lot going on with them. They love containers, because that's them say, hey, developers, doesn't matter if you're on Windows, doesn't matter if you're on Linux, we can run that for you. It's a great entry point for Azure. Okay, so connect the dots and read the tea leaves for your latest research on cloud native. Assume that Docker's not going to sell to Microsoft or an IBM or somebody else. Where's the opportunity? Where do you see the market shifting? In the scenario of game changing, a complete blind spot that maybe people aren't seeing that it's going to explode the next century of growth. Yeah, I mean, core tech, the container technology is going to be in this digital platform no matter what. It's built to go fast, it's built to be easy for developers. All that's in there, regardless of what name you're going to buy it from. I think for Docker, they're trying to make a complete play. I personally think they've got a huge, huge opportunity at the edge, around identity, around security, around making developer tools simpler. Let anybody else run the middle, whether that's a cloud provider or whoever. But I think what we're going to see for companies, customers are looking for simplicity. So there's a big play for Docker there if they can simplify all this. They're looking for an on-prem plus a public cloud play so they can make mistakes and play with different things. That's where Azure comes into play. That's where AWS comes into play. Docker's kind of tiptoeing around there. So it's, look, we talk all the time, what inning are we in? We're still in like the first out of the first inning around, who's going to win this thing? There's a lot of big bets being made, a lot of sort of strategic things on the map, but the revenue dollars aren't there yet to tell you who's winning. There's no clear visibility on revenue. No, very, very little visibility on revenue. A few little points, but not enough to make any big conclusions. The worst thing Docker could do right now is put a stake in the ground and get out over their skis on trying to establish a revenue model. You know, as an analyst, we would love for them to say, look, we're growing our revenue three times as fast, 10 times. You don't even have to give us a number, but give us a sense of what that looks like. We're not getting that from them, they're a private company, totally understand. But we do get a sense of cloud foundry as a proxy from EMC and Pivotal, right? We understand that a little bit. We know what Amazon looks like. So we've got a couple of data points. We'd love to know what they can take. They got to figure out their revenue model, at least directionally get that right. I mean, Facebook didn't monetize, advertising until they crossed the flywheel. And I was pretty obvious. They had to figure out their version of the cloud revenue model. Absolutely. I was thinking about this. You know, when you talk about billions of downloads, it's no different than saying, look, how many Instagram users there were, what app users? The difference is there aren't going to be any ads that go with containers, right? You got to figure out a different business model. It's very transactional. Amazon has shown the way there, $10 billion. Yeah, absolutely. We keep on calling that early. And we are here live on the ground. This is theCUBE at DockerCon in Seattle. I'm John Furrier, Bryan Grace. You stay tuned for wall-to-wall, two days of coverage, SiliconANGLE.tv, keep it here. Thanks for watching. We'll be right back.