 Live from Boston, Massachusetts, it's theCUBE, covering Red Hat Summit 2017, brought to you by Red Hat. I'm joined by my co-host, Jim Miniman. Stu, this is the day one of the conference, 20 keynotes, six general sessions, people from 70 countries gathered here in Boston, Massachusetts. You are a Red Hat Summit veteran. Thoughts, impressions of the first day. What has struck you, really? So, first of all, it's like Red Hat itself. The company just keeps growing. It's just one of those strong progress. We talked a little bit about the intro this morning with Dave Vellante as it's at 60 quarters consecutively that the company has had revenue growth. It's like, I work for a lot of tech companies. It's like, I remember I worked for Lucent when they were doing it, oh, they have a miss and this stock kind of drops. IBM has had quarter and quarter and things like this, but with all of these waves, and look, Red Hat's not the biggest company out there, but they are an important player in many changes in the ecosystem. This is one of my favorite developer shows that we cover at the show. Of course, open source, we say softwares eating the world and open source is eating software. Red Hat's right in the middle of this. I think most people agree there really is only one Red Hat. There's not going to be a Red Hat of something else. There's no one else that has really captured that. They got involved at a certain point in time where they could have that model, but they've extended it. They understand what they're doing. They're getting involved in a lot of interesting technologies, and there's a lot of people, like most conferences we go to, is there's a lot of passionate people that are really interested, very tech-savvy group here, going into all of these breakouts. Many came yesterday for some things. They're coming for a whole week to just dig in, do demos down on the show floor. They've got like little coding challenges and VR things. I mean, there's just a lot of pieces of the show, and we only get to see a part of it, but I've enjoyed the customers, the executives, and only one day of three that we're going to be covering so far. It is early days in the summit, but where would you say that we are in terms of the maturity of the cloud? We heard from Jim Whitehurst, the CEO, who's going to be on the program tomorrow. He talked about how cloud strategy really is the number one thing on customers' mind. The cloud is not new, and we are really evolving and news maturing. Where are we? Yeah, so, right, a couple of stats from the keynote this morning. It was 84% of customers have a cloud strategy. Now, those of us in the analyst world, we might say, well, let's see whether they really have a strategy they understand, and 59% have a multi-cloud environment, which doesn't surprise us. Most people, the joke we used to have was you had two types of customers. Those that were using Amazon, and those that didn't realize that some group was using Amazon, it reminds me of a comment I made earlier about Linux itself. There was always, 15 years ago, big companies would be like, oh no, we're a Unix shop, or we're looking at Windows, and like, no, no, no, there's the guy in the corner. He's been using Linux for a while, and that's been a big driver. So cloud absolutely is maturing. I loved it. It was an interesting discussion we had with Polkormie towards the end of the day. We were with Sam Ramji from Google, talking about how we've got the infrastructure and we've got the applications, and I'm an infrastructure guy, but I knew from day one, the reason you build infrastructures is because of your application. If I can just buy SaaS, I don't care about the infrastructure underneath it. The SaaS provider sure does. We talked a lot to SaaS providers as to how they're building their solution. If I'm using infrastructure as a service, there's some I need to understand the infrastructure, and there's plenty of infrastructure here, everything from there's the storage and networking teams, open sources, permeating every corner of the environment. So it's maturing, but in many ways it's gotten more complex. Cloud was supposed to, we many of us thought simplify the environment, but boy it seems that many of the things that we had had in previous waves, as it gets more mature, it gets a little bit more complex. Red Hat tries to take those pieces together, build them into solutions. We've talked about, there's Red Hat Linux, Enterprise Linux is the platform that can live in many environments. OpenShift is something that allows us to encapsulate all of those services, things like containers. We're working with our cloud native applications and how I want to build them. OpenShift's going to help, and Kubernetes goes into the mix. So Red Hat is places strategic bets and has a strong position in the number place and has big partners. It's really interesting to see, we've had a couple on already and we'll have many on through the week from key providers in the infrastructure and cloud players out there. I think the theme of this year's conference is the power of the individual. And it really is, and we heard from Sam Ramji who said, this is the age of the developer. Developers have more respect, more veneration than ever before. And yet we also heard from Sandra Rivera, it is also harder than it has ever been before to be a developer because there is just so much data. And it's hard to know the difference between the good data and the bad data and where you find the right insights to make decisions that drive the business on that data. And if you're a developer, you might not have the business savvy to do that. So it's a real balance here that the companies and developers themselves are trying to strike. Are they doing a good job? I mean, is it too still too early? It's funny, when you say that it makes me think of in the machine learning space, how do we get the data to train the machine to understand what is good or not? And I wish they'd done that for us when we all went to college. I know, it made so much easier. In my job it's always like, okay, what data can trust? Well, if you remember from Princess Bride, it was like with Visini, it was like, well, I know a vendor told me information, so therefore I know I can't trust that data. But if I take somebody else's data, it gets very confusing as what I'm saying is any single piece of data, a lot of times you know you can throw that out because maybe it's good or maybe it's not, but how do I get, understand the trends, understand what's going on? We love talking to the practitioners here that when they're talking about their business and the impact it's had, we had one of the customers on today was like, look, I deployed this and I had like $6 million worth of savings in my business year over year. I mean, that's hard information, hard to argue with it now. Are there other solutions that might do that? Sure, but yeah, it's challenging to understand what's good data, what's not good data as an industry, whether that's kind of the people or the machines themselves. I think the other question that we're all grappling with here is that you talked about this earlier, just talking about the evolution of Red Hat that you've seen in going to the summit for all these years. This is a company founded in 1993. Today it has a market cap of $15 billion, $2.4 billion in revenue, nearly 8,000 employees. Can a big company, and it's a big company now, can it innovate, can it truly innovate? And we heard in the keynote, one of the things that Jim Whitehurst was trying to do is to cultivate a startup mindset. Is that possible? Yeah, it's a great question and I know, Rebecca, you and I have been talking about this throughout the week so far as to big companies have challenges because there is the structure and the organization and what drives the business. What's interesting about Red Hat is that sure they have products, but underneath it, it's all open source, so community is in their DNA. Paul Cormier said, he's like, we couldn't buy a company and do it closed sourced again. They did that a couple of years ago, it didn't go well, they were going to transition it, but it's been a case study that's been written up. He said if we were to ever buy one, it would be me and Jim in the room alone, yes. Absolutely, so what's interesting is Red Hat is more like a community in many ways as Jim Whitehurst's book is the open organization, so they act more like an open source community than they do a company. Of course that being said, they're profitable, they have employees, they have benefits, they have locations all around the world, so it's been interesting to see how Red Hat adopts certain technologies, contributes to them. It'd be interesting to see, if we ask Jim Whitehurst tomorrow, is say, okay, what is a product that was developed by Red Hat versus a project that was taken in by Red Hat? Something I've seen over the last three or four years, a lot of acquisitions they made, it was, let's take OpenStack for example, there's a big survey that's done twice a year that said, what are people using and what are they interested in with OpenStack? And it felt like that was the buying guide for Red Hat because it was like, oh, okay, here's the CentOS stuff was pretty interesting, well, we can't buy canonical, we'll buy CentOS and that comes under the umbrella. Oh, there's this storage management piece that actually is open source that people are using for OpenStack. Well, let me buy that one too. So Red Hat has been acquisitive, but it's to get deeper engagement in the community, they're all open source, so always there's that balance and big companies of what do I do with R&D and what do I do with M&A and Red Hat has done both. I think they've done a good job of moving the industry forward. Innovation is a lot of times a buzzword. It's a buzzword, yes. But they do some good stuff, they contribute a lot. People here are very positive about what's going on, just because they haven't created the next flying car or things like that. But they're on that. I mean, if we heard here, they're thinking about it. I mean, and I think that's also, and I didn't mean to ask the question insinuating that they're not innovating, but I do think that particularly at a time where we are seeing Microsoft years of no growth, Intel, stalled growth, what is Red Hat's secret sauce and also what is going to be the breaking point for these other lagging enterprise companies? When will we see some new ideas, some fresh, some fresh perspectives? Yeah, it's interesting, because right this whole, the shift to what's happening with cloud, the wave of the machine learning or augmented intelligence or artificial intelligence, how much is that going to ding the traditional companies, especially the infrastructure companies? Red Hat touches it, but they're much broader, their growth as they're an open source company. It's interesting, I've seen a lot of other companies in the open source space that are like, oh, we're not an open source company, we're an enterprise software company or a software company first. I'm sure if we asked Red Hat if they were a software company, they will say, well, of course, like everything we deliver is software, but at their DNA, they are open source and that kind of sets them apart from the pack, even though there are other examples Dave Vellante went through this morning of other companies that are heavily involved in open source, struggling with that, how do we monetize open source? So Red Hat still is an example. Is it a problem with the business model? Why is it so challenging? It's a great question. First time I interviewed Jim Whitehurst, it's like, Jim, why aren't there more billion dollar open source companies? And his answer was, not being flip, he's like, look, selling free is hard. Yeah, I mean, that's a great point, but I think that we need to dig a little deeper and hopefully we can get to the bottom of that by the day. Absolutely, and I tell you, I'm sitting here listening to, we'll be doing the Cloud Foundry Summit in June there, which is pivotal, is making a lot of money with that, but mostly other companies not doing as much. We were just at DockerCon a couple of weeks ago. Docker, the company seems to be growing, doing well. They just changed their CEO today, so hot news out at siliconangle.com. Ben Gallup, the CEO, I just interviewed him a couple of weeks ago, and now he's moving to the board, but they're bringing in the chairman of the board to be CEO, so we look at all these companies, Clodera, just IPO'd, Hortonworks is a public company. These companies that have open core or open source is a major piece of what they're doing. None have had the just measured growth and success that Red Hat does, so Red Hat has a case study. It still seems to be one that kind of stands alone category by themselves, but partnering and growing and doing great and it's exciting to cover. Day two, anything you're particularly excited about? Yeah, so we got a taste of the AWS Enhanced Partnership talking about how OpenShift is going to have deeper integration, and we talked a little bit with Paul Carmiere, so I expect Jim Whitehurst will be talking to him about it. We have one of the main guys involved in that from Red Hat's side will be on our program tomorrow, so keynote tomorrow I'll be watching. Here maybe there'll be a special guest during the keynote to talk about that announcement some, but obviously it's based, we watch real closely. We had Optum, one of the customers on today, said I use OpenShift and I'm using Amazon and want to do it most, and this is a game changer for me, so we think this is really interesting to watch. Really, you talked about maturity early in the segment here, the maturity of hybrid cloud. If Amazon starts to get deeper into the data centers, partnering with companies like Red Hat, and like VMware, that will help them to stave off some of the competition that's coming at them, like Microsoft, and Google who's getting Kubernetes everywhere, so lots more to dig in with, it's some announcements today, but a lot more to come, and more customers, more partners, more Red Haters. That's great, great. Well, we are looking forward to being back here tomorrow bright and early. Thank you for joining us, I'm Rebecca Knight for Stu Miniman, we'll see you back here tomorrow.