 Live from Las Vegas, it's theCUBE. Covering VMworld 2017, brought to you by VMware and its ecosystem partner. Hey, welcome back to the CUBE's continuing coverage of VMworld 2017, day two, lots of stuff going on. I'm Lisa Martin with my esteemed colleague, Dave Vellante. Hey, hey, hey. And excited to welcome an old friend, Eric Herzog, the CMO of IBM, as well as Sam Warner, offering management IBM software-defined storage. Welcome, guys. Well, thanks. We always love to be on theCUBE. Always. Love the shirt. I'm glad I'm wearing a wine shirt again. I think it's like my 25th time on theCUBE with a wine shirt. Oh, you're like the Alec Baldwin of theCUBE. All right, guys, so here we are at... We have the record. That is the same shirt you wore last year, isn't it? Yes, but I did clean it, Dave. We cleaned it. Where's it once a year? Never had to ask anybody about dry cleaning on theCUBE, but, you know, this is the first time for everything. All right, guys, so here we are at VMworld. What's new with IBM and VMware? Can I talk to us, Eric, from a marketing perspective? What's going on there? Sure, well, the big thing is, IBM and VMware have a very strong alliance across our entire portfolio. The cloud division has a big agreement with VMware that was announced with Pat Gelsinger and the head of the division last year. The storage division has all kinds of heavy-duty integration with our VersaStack product, as well as in all of our all-flash arrays. And then Sam's team brought out a new backup and recovery product, Spectrum Connect Plus, which is optimized for VMware and hypervisor and cloud environments. Excellent. And that's one of the things, actually, thematically that we heard yesterday is that, you know, backup is hot. So tell us a little bit more about that hotness and how you guys are working with VMware to dial that. Yeah, dial that, heat up. It's actually, it's more than backup, right? It's about data availability and ensuring your data's safe. Data's the bloodline of your company now, right? Everything's moving towards cognitive and AI. You can't do that without data. Most of your data's trapped as a backup. And what we're trying to do now is make it really easy for people to get at that data and use it for other purposes. So first of all, making sure you're safe from things like ransomware, but also making sure you can get some value out of that data, make it very easy to recover that data. So lots of topics that we can cover there. I wonder, did you have one more and I want to jump in? I did. Just from a, from a, as the CMO, from a messaging perspective, we've heard backup is hot. You just kind of articulated that a little bit more. Same with storage. From a conversation perspective, and you talked about the importance of data, Michael Dell talked about that this morning, that the data conversation is a CEO agenda. How is the conversation changing and the positioning of IBM changing when you guys are talking to customers that is backup is storage a conversation around data that you're having with the C-suite of your customers? A couple of things. I've done storage for 32 years. EMC, IBM twice, seven startups and the C-suite hates storage, including the CIO, but they do love their data. So they all know they need storage, but when you talk about data, data availability, the resiliency of the data, the data always needs to be there. You don't even use things like data resiliency because the CEO doesn't know what that is. So you need to say, so how do you like it if you were in Star Trek and bones wanded you with the new healthcare wand and it came back with no answer? That's because your storage is not resilient and it's not fast enough. So the data has to be available and it has to be fast. So we're moving to, you know, this world where everything is AI and everything is immediate. If your storage goes down and you're in dark trading, you just lost 10 million bucks per second. So, but it's all about the data. So basically what we're doing is getting out of the storage conversation and talking about the data conversation, how data is used to optimize their business and then you weave the storage in underneath us. Well, as you know, if you've got a bad foundation to your building and the earthquake hits, boom, your building falls down. So data is that building and storage is a foundation on which your data rests. I love this conversation. And I think you're right on the C-suite, they hate storage because to them it's just an expense. And I want to pick up on something that was one of my favorite interviews thus far this year, believe it or not. It was the interview that you and Burris and Ed Walsh did in our studio in Palo Alto. And I wonder if you could add some color and then Sam I want you to chime in. What I loved about that interview is you guys talked about digital business and digital business being all about data and how you leverage data. And you said something there and I want to unpack it a little bit. Storage should not be just a dumb target that is unintelligent. It should be an active element of your data and digital strategy. So what did you mean by that and how does IBM make it storage an active element of a data strategy? So the first thing you want to do is you want to make it all automated. You want to make it transparent to the user. So whether it's in the healthcare space, I don't care what your business. Herzog's bar and grill, my storage is transparent. Okay, I'm running a bar and grill. I don't have time to fool around with the storage. I need it automated. I need it fast. I need to see who's drinking what, how many cigars I can sell. I don't have time to fart around, right? Storage can make that happen. So you've got certain CPU that's done on the server level or in the virtual machines and then you've got to have storage that's intelligent. So we're working on some products we're not ready to announce yet but we've got some products that have built-in AI into the storage themselves. So things like, you can search in the storage instead of search on the server. How do you like to be able to look at metadata and have the storage actually fetch the data not the server fetch the data? So the server's crunching, crunching, crunching and the storage is smart enough to go grab the data on its own and then bring it to the server versus the server having to do that work. So all that's about making data more available, more resilient and again, having smart storage, not dumb storage. So Sam, when we were talking about backup is how you say it's not just backup, it's more than that. Pick up on what Eric just said, how is Spectrum Protect more than just backup and playing into what Eric just talked about? Well a lot of the things Eric was just talking about, you're not necessarily going to be able to do all this analysis, reporting, analytics on your production data. You don't want to get in the way of your critical workloads. So how can we make copies off to the side where you can do things like analytics, where you can do DevTest, quickly build new applications. So we give the ability to have access to that data in a way that's not going to jeopardize your core applications as well. And of course that data, you can't lose it, right? I mean, you got to make sure it's protected. So we also offer you a very simple way to protect it and very rapidly restore it. So let's go through an example or a use case that you've mentioned ransomware before. So a lot of people think, okay, I can create an air gap. But air gap in and of itself, you watch these black hat shows and they go, air gap, joke. It's easy for me to get through an air gap. So how do you deal with that problem? Presumably you have insights and analytics that can help you identify anomalies. But I wonder if you could address what's the conversation like with your customers and how are you solving a problem like that? Well, I think there's a lot of stages to how we solve it. I mean, first of all, there's simple things you can do, like have copies that are immutable so they can't be changed. Encryption can't go and encrypt a read-only volume. There is air gapping, which, like you said, there are ways around that. But then there's also, Eric touched on some of the metadata analysis. If you can find anomalies and changes in the metadata that are unexpected, you can take action and alert and administrator and let them know that something doesn't seem right. So there's a lot more work we're doing to introduce cognitive capabilities that can also detect that. One of the things actually that Pat Gelsinger said this morning, and this may have put a smell on your face when you said there's something you can't quite talk to you, companies have to integrate AI into their products and machine learning. So that's the plan at IBM. And we've already done some of that. We have some products that we've hinted at. That's a product codenamed Harmony and we've already done a public blog on that a statement of direction. And that is our first step in implementing AI technology directly into the storage. Again, it's part of what I talked about a couple weeks ago when I filmed at your Palo Alto office. Storage is not dumb anymore. I may be dumb, but storage is not. Storage is smart, storage is intelligent, storage is active, not passive. And in the old worlds, when I started doing storage a long time ago, storage was just passive, just a big brick. It's no longer a brick, it's a brain. And it thinks and it acts and it relieves the CPU and the other areas of your IT infrastructure from having to do the work, which is part of the metadata action that Sam talked about that we're work on and also this project Harmony that we talked about is adding AI intelligence, things like Watson, for example, maybe, but I can't quote me on that yet, but maybe we might put Watson inside of our storage since we happen to own Watson, the dominant AI platform on the planet. We could probably put that into our storage. Maybe we will. They're still at, right? Okay, why not? There's still a lot of dumb storage out there though. Yes. Huge install base. You actually probably sold a lot of it back in the day. So fixing the problem that you created, that's smart marketing. So, but when you talk about the technical debt that exists, how do you go from point A to point B going from that dumb storage that active element? What's that conversation like with customers? So it's actually pretty easy. First of all, storage refreshes every three to five years anyway. So now you come up and say, well, you know, the storage you had only did this. How about if we could do this, this, this and really raise the bar? The other thing is, of course, IBM is the number one storage software company in the world. What we're going to do is going to be integrated into the software side of our business, not just embedded in the storage systems we sell. And that software works with everyone's arrays. So that, if you will, artificial intelligence so we can bring to bear in an IBM, store-wiser flash systems would also work on an EMC, VNX2, would also work on a Dell Compellent, would also work on an HP3 bar, would also work on this guy, that guy and the other guy. Cause we are the number one storage software company in the world for the guys that track the numbers. And all of this is being implemented into the software layer, which means it'll work with the other guy's gear. So we can take the old stuff I used to do at the Evil Machine Company and make that stuff smart. What do you mean when you say you're number one software company? Cause when you work for that company, you guys would always tell me, us as analysts, look it, we don't really have any hardware engineers anymore. We spend all our time on software. So we're a software company. You're talking about something different today. You guys leaned in to software defined, you put your chips in, you did your billion dollar Steve Mills bet, what does it mean today to be a software company in storage? So for us, let's take all of our storage systems, for example, Flash Systems V9, comes with Spectrum virtualized software, which works with over 400 arrays that aren't IBM logo. That software comes on that system. Flash System A9000 comes with Spectrum Accelerate, which is a scale out block infrastructure that works both on-premise and in the cloud. Again, not just with our own gear. So we basically decided that do we want to sell the full system solution? Sure we do. But if we sell the software only, that's fine with us. And remember, most of the big shops in IBM is exceedingly strong as you know, in enterprise to the Global Fortune 1000, in the Global Fortune 1000 down to those sort of one billion dollar company and up, most of them are heterogeneous anyway. So if you're smart, we think we are at IBM to this effect, we made sure our software works with everybody else's gear. Spectrum Protect and Spectrum Protect Plus will back up any storage from any vendor, old or new, we'll go to any tape drive, we'll go to any cloud, we can automatically back up to the cloud, we'll automatically go to an object store, not just to our own object store, but other object stores, we'll automatically go to disk or flash. So we've made it completely heterogeneous and if you will, media and technology independent. And we're doing that across the board with all the IBM storage software. So that compatibility matrix, if I can call that, is very important, has always been important in the storage business, but I feel like it's insufficient in today's cloud world. Let me tell you, explain what I mean and get your reaction, start with Sam. So we've been talking all week about the imperative to not try to reform your business and bring it to the cloud, but rather to shape the cloud and bring cloud services to your data. And that's the right model. A big part of that, huge part of that is simplicity. So we're here at VMworld, we're talking about backup and data protection. Simplicity is fundamental. What are you guys doing in that regard, generally and specifically with regard to Spectrum Protect? Yeah, I think what you want is a very simple way to do data protection and a methodology to do data protection that's consistent between your applications that you're running in your own data center and what you're running in the cloud. So you don't want to find out that, yeah, your traditional applications that you've been running in your data center for years are all protected, but it turns out all the new applications being built out on the cloud don't have the same rigor, aren't following the same standards, you're breaking your governance models and you're at risk. So what you want is a simple way to manage both sides. You want a simple dashboard that gives you a visibility to the entire environment in one space. So you know, I've got 2,000 VMs, 1,800 of them are backed up, two of them aren't backed up. Oh, those are in the cloud. Somebody didn't set it up correctly. You want to be able to say that very easily on a simple dashboard and that's what we're bringing with Spectrum Protect Plus. Speaking of simple, Eric, last question to you. As the CMO, how do you make this message simple for a C-suite to comprehend and understand and help take them to the next level for them? Well, for us, we don't even talk storage anymore. We just talk data, applications, their workloads and their use cases. That's it. And then you bring storage up underneath it. Again, it's the foundation of your data infrastructure. Your data is the primary building, but if you don't have a solid foundation and being from Silicon Valley and being through the 89 earthquake, when the earthquake hits, if you have a solid foundation, building stays up. If you don't, building falls down. So we lead with data, data, data, ease of use simplicity, but really focus on what's your application, what's the workload you're trying to accomplish, what's the use case you need. And when you do it that way, you take the discussion away from being you're a storage guy. It's you're the data guy. You're the business guy. And that's how you have to pitch it. I like that. Hashtag data, data, data you heard here first. Eric and Sam, thank you so much for joining us on theCUBE. Wish you best of luck and we'll be keeping our eyes and ears open for what's coming with AI and machine learning. Thank you for watching theCUBE continuing coverage live from VMworld 2017 day two. I'm Lisa Martin for Dave Vellante Stick Around. We've got more great conversations coming right back up.