 from the MGM Grand Hotel in Las Vegas, extracting the signal from the noise. It's theCUBE, covering Splunk.com 2015. Brought to you by Splunk. Now, here are your hosts, John Furrier and George Gilbert. Okay, welcome back everyone. We are here live in Las Vegas for Splunks.conference 2015. This is theCUBE, our flagship program from SiliconANGLE Media where we go out to the events and extract the signal from the noise. I'm John Furrier with my co-host this week, George Gilbert, chief analyst at Big Data for Wikibon. And our next guest is Emilio Umioka, VP of Global Partners at Splunk. Welcome to theCUBE. Great to see you. Oh, thank you very much. Very happy to be here. So, we had a great conversation earlier on our kickoff around the growth. And my comment to George was, how tall can Splunk be? Meaning, it's not a startup anymore, even though you act like a startup in principle and in culture, you're one of the big players at the table now. And you've got big partnership Cisco, Palo Alto Networks, so big names you're working with, and you're global. So, that's a big success story, but yet there's so much more you could do. So talk about, for us, lay out the ecosystem and partner map for you. Channels, sales, go-to-market technology partners. You lay out the 101 map of what's going on with Splunk's ecosystem. Oh, excellent. And, Paul, for us, it's an important event. We have more than 800 partners participating here. At the Source Pavilion, we have more than 60 partners with kiosks here showing and demonstrating their solutions. So, I'm responsible for worldwide partners, traditional bars, distribution, resellers, technology alliances, alliances, strategic alliances, OEM, system integrators, and service providers. So, a big range of go-to-market motions that we have. So, I noticed a lot of big names here. How is that affecting your sales, motion? Obviously, you have a great installed basic clients, but there's a pressure to get more, right? It's a combination between getting the right partners. So, if you look at our overall partner strategies based on three main priorities. One is to focus, focus on the key partners that can invest and grow with us. Second one is to drive enablement, how we transfer knowledge, technical sales, and marketing knowledge at scale to our partners. And the third pillar for our strategy is how we build the right trust between our own sales teams and our partner sales teams. So, I got to ask you a question because one of the things I'm fascinated with living in Silicon Valley is the bubble mentality of buying sales. You pay $2 for $1 of sales. That's a cost per order dollar. Two net minus one, it's not good. But indirect sales has been a real big part of the enterprise sales motion, indirect and direct. Having a good channel and a good partner strategy can give you an increased profitability. Could you share with us your thoughts on that because that seems to be an area where you have good synergy with channel partners where they can add value on top of supply. What's the latest there and what's the trend? So, the key important thing for us is how we expand our coverage leveraging our channel partners. So, from a channel motion perspective, building the right capacity model is quite important. If you go back to what the way Godfrey phrases it, it's not about the pie, but what's the size of the pie and what's the size of each slice of the pie? Is that enough money for our partners to make on each slice of the pie? So, looking at specifically at some of the announcements we've made in terms of market groups, buying centers, so we go at IT off, security. This is having the right partner profile for that specific solution that we need to address. Looking at our customer needs. So, building the partner capacity model has been a key component for us. And the second pillar for that approach is how we reward value that partners are bringing to us and to our customers. So, you have pre-existing markets and green fields. Talk about the dynamic between the two because some of these new markets like IoT, the Internet of Things, really, it could be a nice green field. Yet, in other established markets, there's some partnering that has a hierarchy and or your role in the sale and or component could be big but the pie's so big that you won't direct. And that's where the green field, in some cases like IoT, having a very strong team that can drive the technology alliances, you know, building alliances. I know you interviewed Singh Swarth, for example, here. Really building solutions that we can either meet in the channel type of approach or meet at a customer site. But having the right definition of what partners we need for each specific green field is a key component for us. Along those lines, do you have rules of engagement for when you meet at the partner versus when you meet at the customer? You know, is that done by the type of solution or it's done by the geography? Yeah, so clear rules of engagement is a main component for our third pillar, which is building trust. So when you look at our rules of engagement, it's based on some of the areas you address, like what sort of account segmentation that a major account, enterprise account, a territory account. Is it in the US, outside the US? Do we have the right partner capability and right go-to-market motion in that sense? And do we have the right solution partners that can come and really build up some of those solutions we need to address? To follow on that last point on solution partners. So we've heard from many people that Splunk is growing up from this sort of log analysis and visualization tool to an IT ops platform. What type of solutions are some of your partners building on a platform? And how do you go to market with them and against whom? Well, again, the market becomes very broad when we're going to new markets like Business Analytics or IoT. So one of the key things that we did from a developer ecosystem perspective, we launched SDKs, we launched developer frameworks, we provided sandboxes so developers could start developing some additional solutions. So if you see some of our, for example, some of our Korean ISPs on the way they're really driving automation on IoT, on manufacturing, on semiconductor or in Asia Pacific and Hong Kong and the way some of our partners are building applications to monitor traffic of the Hong Kong port. So they're a very, very Vanguard approach to developing new solutions that in the past we were not able even to visualize they could be possible. And in particular, the area that I'm most interested in is IT operations, just because it's becoming so critical for the new application landscape, which is so multivendor, it's breaking apart into thousands of microservices. Is that, does that take a huge amount of new value add on top of the platform? And so what are the price points compared to just the generic platform? No, I think from IT operations, Cisco is one of our key partners that we have strategic partners and we're working very closely together with their data center team in order to really build solutions within their UCS usage. And what we're seeing is just the synergy that we are creating in terms of obtaining this source, these different sources of information and aggregating them and producing some business insight. So partners are really stepping up on that approach. So what's your take on the news today? I'll say the IT service intelligence is big news. We're hearing great reviews from the folks here. How is that going to render itself in your world with partners? Can you share the strategy there? Because it seems to be very partner friendly. Well, you guys are partner friendly to begin with and also developer friendly. Yeah, so very excited. I mean, our partners, we had two advisory councils yesterday, one for the Americas and one for the EMEA where we share some of the product roadmap with our partners. I mean, they're extremely excited about opportunities to really expand their footprint with their accounts. So we're driving now the right technical enablement, the right sales enablement, the marketing enablement piece. So they're ready to go and capture that opportunity. But they're seeing it. Everybody was so excited this morning by the launch of the new product. What's going on in Asia Pacific? I know that's a big part that you're covering was your previous assignment and had a great career in Asia Pacific. Now you're global and to be hired and you're close, so to speak. You're talking a bunch of candidates. I'm sure you help your workload go down a little bit, but that's your territory. And there's been a lot of growth there. A lot of uncertainty financially. So the China crisis. How is that? What's going on in Asia Pacific? Growth is there, obviously, still the big numbers. Oh, yes. I mean, excellent growth and opportunity there. So if you look at some of the most mature markets like Japan and Australia, some of the use cases that are coming and some of the building up of the partner ecosystem through managed service providers, through some of the system integrators, they're beginning to build splunk into their practices. So going much higher in some of the accounts where we were starting from bottoms up, now we have an approach where we can cover the account in several areas. Big, big strong investment in government continues to be a very strong vertical for us, telcos as well, financial services, and move to the cloud, which is another component that you probably saw this morning on the announcement. I mean, splunk being a great solution for being a hybrid solution if you want, whether you want to put your data in the cloud or on-premise or both. And you can do a search on both sides. I love a great guest like yourself who can just lead into my next question without me even asking it. So I brought the Asia Pacific comment really in context to cloud. Yes. It's a global reach. You guys have a global reach, it's a big story with splunk as you guys grow, but cloud brings up the question, global reach is a benefit, but also, if you're not architected properly, could be a pain in the butt because there's a lot of different jurisdictional issues with being goal reach. What are some of those things that you guys have done to have a global consumption contract? Yes. That's a really kind of a big deal. Not many people talk about it, but it's important, it's almost table stakes now. And again, it varies. It varies by specifically by data sovereignty laws that we have in some of the countries where you need to keep some data on data centers that are located in your country and some data that can be exported. But I think the beauty of splunk is that you can have a hybrid solution. We don't, we're about the customer choice, whether the customer wants to have everything in the cloud, everything on-prem, on some pieces of the data in the cloud and some pieces on-prem and being able to search in both directions. We're really appreciate you taking the time to join us. Share with the folks out there who are watching thisyears.com. What's the big story in your mind? What's the vibe? What's the feeling this year, vis-a-vis last year or other years? What's the notable top three things? Well, amazing, amazing presence, I would say 4,000 people versus last year. The amazing amount of partners that we have, 800 partners, so a good chunk of them here. More than 60 partners sponsoring the source pavilion and some big launches and enterprise on ITSI and cloud and company is very exciting. A really positioned itself very strongly to become the machine data platform for the industry. One of the, my final question for you is one of the partner conversations we always hear. Is channel this, indirect, good leverage. Having a partner strategy always looks good on paper. Because the numbers work. That's an economic game, the product has to be good, you guys have good software, so check that. Economics, if people are making money in the partner ecosystem, that shows some vibrant success. How do you guys do in that regard? You guys are feeling good about the economics of the partners, everyone's winning. Can you give some color and insight to that? Yeah, of course, and you touch on a few things and this is what we addressed, for example, on the advisory council that we had yesterday. Partners are here to know if they're investing on the right company, investing on the right technology and they came out very excited from yesterday and today. And that's one key component. Am I investing on the right technology? Can I make my business profitable and sustainable for the next few years if I invest on that technology? And what are the key areas that I need to invest ahead of time in terms of technical enablement to be ready to capture that opportunity? And what we have done in the last year or so, we've shipped our model with the introduction of Partner Plus, which is our partner program, to really reward the partners that are bringing value to the equation. So you see partners- You mean wrapping services around the new product? Wrapping services, putting technical resources, investing on certification, really building together with us a growth plan. That's what we're seeing. So if you look, for example, in the US, the top 30 partners that we track are going at twice the rate that the company's growing. That is a key component for that. You're certainly a senior veteran in the industry in terms of the channel and partner ecosystems. So I'd like you to take the last comment to share with the folks watching. Maybe some younger managers growing up and looking at this new normal cloud. What does it take for a product to be partner-friendly, channel partner and or technology partner? What are the key attributes in today's modern era? And it's moving. If you look at the cloud, you know, some of the cloud is mostly related to services. It's the way the business is evolving from an upfront payment or to recurring payment on the way you manage cash flow, on the way you invest on the right technology. I understand. Make sure you, as a partner, if you're building your own company, make sure you're investing on the right technology because it's very hard to have sustainable growth and being profitable with our technology. And it should be an enabling technology. Exactly, exactly. And as we become more and more of the platform, you'll see verticals coming in, you see application coming in, and a huge opportunity for all the ecosystem to be very profitable. Milio, thank you so much. Obviously, with open source, ecosystem is a key thing, but certainly on a money-making basis, certainly it's healthy to have that as well. Thank you for sharing the data. No, thank you very much for the invitation. All right, this is theCUBE. We are sharing the data on the Ecosystem Partner Network here at Splunk.com. We'll be right back with more after this short break.