 From the SiliconANGLE Media office in Boston, Massachusetts, it's theCUBE. Now, here's your host, Dave Vellante. Hello everyone and welcome to this special CUBE conversation. You know, Hewitt Packard Enterprise has gone through one of the most significant transformations in the history of the tech business. Once a much larger and far flung conglomerate, HP, as you know, split in two. And now, HPE is much more focused and has a completely different posture with respect to technology partners. So today, we're going to focus in on the big drivers of innovation in the technology business, data, AI and cloud, and get HPE's point of view on trends in these spaces. As well, I want to dig into two areas of growth, hyper-converged infrastructure and intelligent storage. I also want to share some ETR data using SimpliVity and Nimble as proxies for these markets. Finally, we want to peek into some of the spending data in HPE's ecosystem to see how a more partner-friendly HPE is faring. And with me today is Patrick Osborne. Patrick is the Vice President and GM of Big Data Analytics and Scale Out Data Platforms at Hewitt Packard Enterprise and a friend of theCUBE. Patrick, always a pleasure. Thanks for coming in. Thanks so much for having me. So let me set it up here. And I want to share some spending data with our audience. Alex, if you bring up the first slide I want to show us. This shows the latest spending data just released from ETR on the various segments. And it's a double Y axis. And you can see in the left-hand side is the average spend represented by the size of the charts. On the right-hand side is the growth rate represented by the dots. And I've highlighted in green some of the key areas that we're going to talk about. Analytics, BI, Big Data. You can see 12%, still pretty big market, even 10 years into the Big Data theme. Cloud computing, growing 15, 16%, ML AI, 17%. You can see the container space is growing at between 15 and 20%. So Patrick, let's start with what's in your title. The Big Data, the analytics piece. What are you seeing there? What's HP's story? Yeah, so that's been a huge area of growth for us within HPE, not only from an infrastructure, but also a services play. We've got a number of big partners in the traditional Big Data space. We've made a number of strategic acquisitions over the last two years in this area, specifically around Blue Data, MapR. So these areas that customers continue to invest in in the macro area are very important. And I think one of the things you're seeing here from a growth perspective is that they're also bringing in some very adjacent markets with AI and ML, so it's part of an entire workflow. So you start off with BI, analytics, Big Data, and we have a number of solutions around that area. And then starting to add in things like AI, ML, DL, into that analytics workflow. So it's been a really good project. So you're really kind of adding into your portfolio, they only say the MapR acquisition. They kind of were one of the Big Three that started that whole Big Data movement. And then now you have these organizations with these troves of data and they're trying to figure out, okay, what do we do with it? And that's really where machine intelligence or AI comes in, isn't it? Absolutely. And not only are we providing a number of solutions for customers in this area, but we're using it ourselves too, right? To enhance our customer experience, enhance our automation, support automation, definitely give a much better customer experience with our storage and data platforms. So wait, you're saying you're practitioners of AI to make your customers' lives better, and you're saying by embedding that into storage platforms? Absolutely. If you take a look at a number of our marquee services that we have, whether it's things like InfoSight, GreenLake, even Aruba Central, think about some of the things that we do at the Edge, all that is being powered by AI at the end of the day. So we're using those techniques to improve the product and solution experiences for a number of our products, everything from it started with Nimble, we added three-par, now we've got SimpliVity in the InfoSight, and as we start to bring together some of the workloads at the Edge, right, with Aruba and things we're doing there, it's, you know, the customers are obviously voting with their dollars. All right, let's talk about cloud generally, but specifically I want to get into hybrid and containers. I mean, cloud has permanently changed our industry. Everybody wants to bring that cloud model on-prem. It's clearly a hybrid world. You can see containers really growing. Stu Miniman has a premise that, look, containers and Kubernetes, that we treat them as a separate thing, but it's really being embedded into all parts of the portfolio. So what's your point of view on containers, hybrid? Bring us up to speed on what HPE is doing there. Yeah, so that's definitely fueling a lot of our growth, not only in what you think about the traditional storage segments, but as well as HCI, right? So, you know, when we talk later about some of the growth we're seeing in Nimble and SimpliVity, we've got a number of solutions that sit directly within this container, container orchestration, container management. We've got things that we develop on our own. We made a huge announcement at Kubicon, right, around the HPE container platform. So for customers that want to run these analytics, AIML, very data-oriented applications that run in containers, we have a great platform for that and HPE container platform. We can run that on bare metal. We can run that in SimpliVity, for example. So we're seeing a lot of fuel for that, not only just servicing some of the storage and data needs for containers, right, but also being able to provide an infocyte-like experience for this new generation of application development and workflows. How do you see the edge fitting into this? You know, we interviewed Antonio recently with John Chambers at the Pensando announcement and that was kind of interesting. Do you see that as a pendulum swing or sort of an expansion of the cloud, if you will? Yeah, I definitely see it as an expansion. When we talk at HPE, we want to be an edge-to-quarter cloud company and helping customers navigate the digital transformation in hybrid IT, right? And then we're going to offer that to customers as a service through GreenLake. We've been pretty public about that. And so one of the big opportunities we see is around these distributed data centers. Some people define it as distributed edge, whether that's customers who are doing autonomous vehicles, autonomous drilling. We see a number of big box retailers, for example, that don't necessarily have a traditional data center, but it's not so far out into the edge that it's like an autonomous vehicle. But they have similar concerns in terms of distributed nature, how do you automate that, how do you manage that at scale? And so these assets that we bring together with things like Aruba and our edge line servers and managing that data experience is something that we're going to capitalize on in FY20 for our customers. It's interesting, right? Everybody has an Amazon war room, but many sectors of retail are really on fire right now. People trying to take advantage of their store presence. And IoT is a big factor there. So you're seeing a lot of that action as HPE. Yeah, absolutely. And those customers of ours are fueling their growth through digital transformation. So they're using containers and Kubernetes and this new style of application development. And they want to be able to distribute those data centers and that data. But they also have to make it simple, right? So you see the march towards what we, our platforms like SimpliVity for HCI, some of the offerings we have around, independently scalable, three tiered architectures, but you get the best of HCI with that. We call it Nimble DHCI, right? So we have a number of offerings for customers who really want that scale and serviceability. All right, let's pivot a little bit and talk about some of that infrastructure. Alex, you bring up the next slide. What I want to talk here is this is the ETR data. Every time they do one of these surveys, they ask you, essentially you're spending more, you're spending less and they subtract the less from the more and that's what they call net score. Net score remember is a measure of spending momentum. Now what we've done here is you can see the filtered in 313 HPE customers out of the 1,000 plus survey respondents this quarter. And you can see a good mix of enterprise size and industry and it's a lot of North America, but good regional too. And we're showing the net scores breakdown for two of your platform, SimpliVity, which is the HCI and Nimble storage. And you can see the bright green is people adding to the platform, the sort of darker green is spending more. So let's start with SimpliVity. HCI still a really hot and growing space. You've got a net score of 38% almost, which is very, very strong in ETR parlance. You know, it's not off the charts like some new tech, but it's really, really solid. So what's the update on SimpliVity and HCI? Yeah, so I mean, this is obviously, from a market perspective, HCI is a rapidly growing space still, right? There's a lot of room for growth, both Brownfield as well as Greenfield opportunities in the core data center at the edge, even in hybrid cloud format. So for us, it's all about new logo acquisition for SimpliVity, we've shown phenomenal growth rate for that technology stack developed here in Massachusetts, right, great local company, great story. And so for us, this HCI, the markets that we're playing in, when you take a look at storage and data management in general, sub segments of the market are growing rapidly, right? You take a look at HCI, you take a look at SDS, you take a look at all flash. And so we have some great offerings in that space that are completely differentiated from a customer experience and a technology experience and they work together. So for example, SimpliVity, we just announced earlier in the, and later in the calendar year in 2019 that we would be offering SimpliVity within InfoSight, right? So you have the same experience that you get from Nimble, right, you get with our HCI product. So we're driving those experiences together. Obviously, all flash is a huge growing category within storage, Nimble. It's got some great growth there, not only just for new logo adoptions, but expansion capability. So we're, you know, two great products that we're seeing some success in. Yeah, so let's talk about Nimble. Alex could show that data again. So Nimble's got a net score of 46%, which again, a lot of momentum. I mean, smaller, you know, sample size, but still really, you know, strong. And you can see it's a more mature market. So you see maybe fewer adoptions, but almost 50% of your customers are saying you're going to spend more this quarter relative to last period. So that's showing momentum. You mentioned InfoSight, which is really the technology that sort of Nimble brought to your company, which are pushing out through the portfolio. So your thoughts on that? Yeah, so I mean, at the end of the day, customers are, you know, the products themselves are great and they provide the customers a really good experience. We're driving all that together at a meta layer, right? So when we talk about the products and solutions, for us, the strategy is around the intelligent data platform, right? So we have a number of platforms that can help address a number of different workloads, whether it's HCI, disaggregated HCI, whether it's all flash, whether it's, you know, container workloads and container orchestration. But we want to provide a very good experience that you can consume as a service. And we're driving that together across product lines with data services that work both on-prem and in the cloud, right? So we have HPE cloud volumes and a number of our cloud data services that tie these platforms together. So for us, it's all about a strategy around this intelligent data platform, not just individual products. The individual products are great, but from a strategy perspective, that is definitely resounding with customers. Well, you talked about digital transformation earlier, Patrick. I think that's important. Customers want solutions. They don't want to, certainly don't want to provision loans. They don't want to think about managing boxes. So they really want that infrastructure to be invisible. They want to push their folks up the stack to just do more strategic things. And it's really your R&D that they're looking toward to automate a lot of those mundane tasks, isn't it? Yeah, they look towards R&D as well as they look to HPE as a portfolio company to bring together a solution stack that's going to work for them. And sometimes that solution stack is comprised of some of our partners as well. So we pick some of the best partners in the industry to go work with in some of these hottest portions of the market that are growing significantly. So in the areas of HCI or in the areas of software-defined storage, we got a number of folks that we partner with, Hybrid Cloud, and we are able to bring a full, complete solution to a customer and we de-risk that for our customers at the end of the day, right? We've got some great partnerships with some great companies and that's really suited HPE very well. Well, great segue. Let's talk about some of those partnerships. So when Hewlett Packard split into two companies, it opened up a ton of opportunities for partnerships for you guys. You got a great distribution channel and what I'm showing here, Alex, on this next slide if you bring this up is three partners that are gaining a lot of momentum based on the spending, ETR spending data in the surveys, Cohesity, Veeam, and Nutanix. Now remember, ETR uses this concept of NetScore, which we talked about and I'm going to talk about that a little bit but also Market Share. Market Share is a measure of pervasiveness. In other words, how much they're being mentioned inside of the survey. So I'm showing here Market Shares, but also NetScore's and you can see Cohesity is just starting in the survey. So starting to get more noticed and then you can see Veeam and Nutanix with the consistent, long, steady Market Share growth. This is again within the Hewlett Packard enterprise account base, that 313 respondents. So you can see there, all three are doing very well and look at the NetScore's for Cohesity off the charts, 74% growing very, very rapidly. Again, smaller sample size. Nutanix, much larger sample size, 60% NetScore. So very, very strong and Veeam, surprisingly for a pretty mature company with a 45% NetScore, again, very, very strong. So talk about the partnerships, the new HPE partner posture and then we can maybe get into what you're seeing in the market with some of these partners. Yeah, so for HPE, we listen to our customers in terms of what their challenges are. Part of my business is managing around scale out data platforms and so the data is always growing and so we're seeing this big trend of scale out architectures powered by ubiquitous, very high bandwidth, low latency networking in the data center and outside the data center. And so we're able to put some of these software stacks on our infrastructure that works very well with our own IP solutions and solve a number of critical problems for customers around secondary storage, right? It's growing, you want to make use of it to back up and disaster recovery is always a problem. It's definitely an opportunity around hybrid cloud. HCI and SDS has many forms and flavors and we want to be able to provide those solutions to our customers, especially if you're doing hybrid or private cloud. So a lot of these partners, we want to provide a full stack solution to our customers and these partners help us do that. How are you, I mean, you've got HCI with Nutanik and you've got HCI with SimpliVity, you've got sort of certainly Veeam and Cohesity Compete. How do you guys position, let's start with the HCI piece. Do you just let customers sort of direct you and guide you or do you guide them? How does that all work? Yeah, I mean we always listen to the customer first but at the end of the day, we lead with our own IP and we have two great solutions around the HCI framework where you're going for a very simple, very scalable solution in SimpliVity that has some very powerful data services, great economics for the HCI market and you see the growth in SimpliVity for that. Then we have a number of other solutions specifically around Nimble called DHCI. What we're finding is that customers, there's a class of customers that want to, they want the simplicity of management that you'd get from HCI but they also want to be able to independently scale your compute, your networking and your storage and we're able to provide that with something like Nimble, ProLiant, our networking stack and then plug that all into InfoSight and it works together. So at the end of the day, if I have a workload that's more appropriate to work on SimpliVity as a platform or it's more appropriate for DHCI, we can recognize that for our customers through predictive analytics, we can automate the placement of that workload and then we provide customers a set of data services so those platforms work together. So it really works out well. Okay, and then in terms of, well, take the situation with Nutanix, so that's a customer saying, hey, we want you guys to work together and you say great, no problem, we'll do that. So that, they used to say. Yeah, and we have a set of recipes and reference architectures and offerings around those that are available direct as well as through the channel. And is it fair to say that Veeam, I mean Veeam is renowned in the SMB, even though they've tried a big push in the enterprise, you're part of that push and of course, Cohesity is the hot new kid in the block. Again, is it just sort of market pull that drives that or do you have a- Yeah, I mean, we definitely, Veeam has been recognized as a great solution for customers doing, started off certainly focused directly on virtualization and then their strategy has moved to a very adjacent market, which is how do I tackle that virtualization and Veeam's and protecting my data but in a hybrid cloud format. So they're definitely all in on cloud. I think Cohesity has a very scalable file system back in and it started off with backup and recovery and now it's moving into some very adjacent use cases around file, secondary storage, what can I do around CI CD pipeline? So it's kind of approaching it from different angles. So you guys are really kind of changing your marketing and your product marketing, really focusing more on solutions. Yes. Outcomes. Customer outcomes, bringing that cloud model to wherever your data lives, whether it's on-prem, at the edge, talking about bringing containers throughout the portfolio, bring it home, what are you sort of hoping for 2020 looks like, what are some of those outcomes and what should we expect from your perspective from HPE? Yeah, so I mean, we at HPE are very focused on this edge to core to cloud concept hybrid IT. So all of our products have some sort of endemic, whether it's data services or a management paradigm around hybrid cloud. And so we really are, you'll see that within our products, product releases, solution releases, the people that we partner with. I think the big thing that we pivoted into at the end of 2019, you'll see this accelerate significantly in 2020 is around this consumption model, the cloud consumption model with GreenLake. So we talked a little bit, certainly GreenLake from a financial perspective, but also GreenLake as a management paradigm. So GreenLake Central was announced at the end of the year and just the ability to be able to, like you do in the top of cloud, but top of private cloud or top of hybrid cloud from HPE and get a really good visibility financially into what you're doing. I mean, it's a mindset too from the top. I mean, Antonio is saying everything is a service, right? Absolutely. Yeah, so. All right, Patrick, hey, thanks for coming in and give us the update on HPE. Good luck this year and great to see you. Yeah, thank you very much. You're welcome. And thank you for watching everybody. This is Dave Vellante for theCUBE. We'll see you next time. Thanks for watching.