 Live from Las Vegas, Nevada, it's the Cube at IBM Edge 2014. Brought to you by IBM. Now here are your hosts, John Furrier and Dave Vellante. Okay, welcome back everyone. Here live in Las Vegas for IBM Edge. This is the Cube, our flagship program. We go out to the events and extract the signal from the noise. I'm John Furrier, the founder of SiliconANGLE. I'm Troy Mike Coase, Dave Vellante, co-founder of wikibond.org. Our next guest is Bernie Spang. VP of strategy, software-defined environments, which includes the storage product, the cluster product you guys announced. Welcome back to the Cube. Appreciate it. Thank you, great to be here. IBM Edge is booming. It's got a vibe here. It's like there's a spring in the step here of the storage, but it's not just storage anymore. It's infrastructure. We've always said, Dave and I, the storage is the heartbeat, the heartbeat of the engine of innovation. Tell us your perspective of this year. Well, yeah, it's great to be here. This is my first edge. As you guys might remember, the last time we met, it was at our information on demand conference. I spent most of the last eight years in database software and systems. And in this new role, I've kind of stepped into the different layer, but it's still all about data. And, you know, it's really about the recognition that in this environment that we're in, the amount of data we're generating, all the mobile and social aspects, the internet of things that are generating the data, the management and the protection and the ease of availability and the performance of accessing data is critical to competitive advantage. So, you know, it's exciting to be on this side of the fence, if you will. So strategy is a big part of your job now, but obviously now it translates into the product teams with storage. And if storage is the linchpin for the innovation and the lever, if you will, how do you look at the strategy, the chessboard, if you will, or the landscape? Because you have storage, virtualization is still a big part of the enablement. You get the data center, you got cloud on the horizon. So that's a pretty broad canvas to paint strategy on. So how do you look at that? And what are the key things that you're watching in the mix here that you're going to evaluate heavily? Well, the thing we're looking at is in the environment we have today, you still have the traditional data workloads, the database apps, the data warehouse type analytics, but we obviously have huge growth in the new generation workloads. At the same time, we've got breakthroughs in technology in software-defined, software-defined computing, storage networking. And when we talk about software-defined environments as a strategy, we pick the word environment on purpose. It's not just a single system, it's not even just a single data center. It's how you have a software-defined environment that potentially is global and spans both on-premise and on cloud capabilities. Like you said, a broad canvas on which to build a strategy. So the key thing when it comes to the storage aspect of it, we're moving to a world, and Mike alluded to this in the earlier piece, where we have to build a new generation of architecture to meet this new generation workload in a way that delivers greater performance, greater agility, and lower costs for our clients. And that's really the key thing here for the strategy. So how do we use the new technologies for the new generation workloads to do those things? So it's interesting that you have a former Tivoli exec now running the software-defined systems business, storage head. And the reason to me that's so interesting is you look at the success of Tivoli in the context of other industry trends you had VMware became ubiquitous. But Tivoli plugged into that and didn't really miss a beat. Now, IBM, of course, invented virtualization, right? So you didn't need to buy VMware. So now the software-defined opportunity comes along. VMware is certainly talking its game, but with this whole new software-defined meme and open source, it opens up a whole new opportunity for everybody, startups, established guys, guys with big R&D budgets. So from a strategy standpoint, how do you look at that opportunity and talk a little bit more about that chessboard and the moves you can make to stay relevant? Yeah, no, certainly. So certainly IBM is committed to open standards, adopting and contributing to open source projects where it makes sense for progressing the industry and adding value to our clients. We're one of the top contributors to open stack as an example and building on that community, open daylight for the software-defined networking. So that's strategic importance. Also providing an environment that supports heterogeneous architectures, heterogeneous platforms, inclusive of virtualized environments from other providers because we provide solutions for our clients. We are a technology partner that works in their heterogeneous environments and we need complete solutions, not rip and replace, all your problems must be nails because we have a hammer to offer you approach to things. So that's a big part of it. The server virtualization and the value that it delivered is kind of a first phase, if you will, the software-defined world where greater agility, greater efficiency by driving up the utilization was a great proof point we saw in the server space. Now with what we've done in virtualizing the software and our sand volume controller and how it virtualizes traditional storage pools, delivering greater performance for the app at much more cost efficient utilization of the storage is a next step. And now for the new workloads, when you look at both structured and unstructured data, files and objects, and you look at distributed cluster environments, now you need a software-defined storage approach that virtualizes for those environments and those kind of workloads. And that's where our new elastic storage capability comes into play. So if I summarize sort of the strategy, you're going to virtualize and encapsulate sort of the old, I'll call it, the existing data services. It's not going away. They live inside storage controllers today. You're going to ride Watson's coattails and bring some of that technology into the fold. You're going to invent some new stuff like storelets. You're going to borrow from GPFS to a derivative of that and get to this sort of object environment and then heavily leverage open source to create this software-defined world, which if I understand it, extracts function out of that's been locked up for decades or at least encapsulates that function into this open environment. And then over time, this is the piece I'm not sure of, over time build out a stack that is as robust potentially as the old. Is that the approach that you're taking? Yeah, no, that's a good way to lay it out. And then the key points there and what you brought out was supporting the existing and bringing it forward, bringing to bear proven technologies that we've been developing and using in supercomputing environments and the Watson environment like you mentioned, but bringing that together with the new open technologies to give you that environment that's got the flexibility, the agility, it's open so you have from our client's point of view, they have choice, they have source of skills that are being developed in the marketplace around these open technologies, but it's built on a foundation of proven technologies that have been addressing and can address these large scale challenges in a robust, secure enterprise reliable way. Okay, so how's that different from the other guy? So you got customers talking about customers, yeah, that's what EMC Viper does. What's different? Okay, so EMC Viper is what they articulate is their software defined storage strategy and it's a control plane layer that works across the EMC portfolio and they're asserting increasingly a broader set of capabilities. Now we've been delivering the same volume control of virtualization with support for hundreds of IBM and non-IBM systems for some time now, I think the number's over 260 total systems for the traditional virtualization with our new elastic storage capability, this is a software offering that works with anybody's storage and that's an important point for our clients is they build out this global, scalable environment that can support structured and unstructured data. They can use existing storage and reuse it and repurpose and continue to get value from it, but we're very much open and cross-platform that way in a way that I think differentiates us. The other thing that's important is the elastic storage is really that data virtualization layer and has built in management of the lifecycle management of the data and policy-driven automation to move the data from flash for top performance needs or to tape for seldom used data, moving it to tape to drive up your cost efficiency. It's got built-in encryption and secure cryptographic erase capabilities built into the environment. So, there's a lot of capability and also flash cache is also a new element so that in your servers that have the elastic storage running you can have flash in the server to further boost the performance up to six X performance boost that we've seen thus far. So, in comparing, just sort of go down, we've mentioned a number of things like once I'm keying on our SVC, certainly a more mature virtualization engine. No question about that. GPFS, a more mature file system that's in a global single name space file system. Correct. Analytics, which is also more mature and proven. And then the object store piece comes from open source, from Swift. Yeah, and that's another new element to the story with the latest release, we support the opens to act Swift access to the file system so that it can be used both as a file system and as an object store. Yeah, so those are essentially, to me anyway, four major differentiators designed to sort of meet the same objectives, maintain the customer install base, make sure those guys come with you and compete for the new stuff. The big difference, of course, is the open source posture, I guess that would say. I would say the combination of the open source posture and the proven technology that's been at the heart of super computing type workloads and high performance analytics workloads for more than a decade now. Yeah, sorry, I meant from a strategy standpoint. I mean, if you're EMC, you don't have that. I mean, they kind of do, right? The Vplex brings the virtualization piece and they're building their own file system starting from scratch. Okay, but the strategy's similar. It's just that they don't have 14-year-old SVC and I don't know, GPFS is... Yeah, fair point. Been there a while. So the strategy's similar. The big difference I see is open source unless I'm missing something else. There's another element to this that we haven't touched on that goes beyond the storage. It's how this dovetails with our software-defined computing capabilities and the platform computing software which works across both virtualized environments as well as bare metal cluster management. And so bringing the capabilities to bear for the workload and for the compute environment coupled with this scalable storage thing is delivering incredible performance advantages for clients and cost efficiency. And we had a client here on stage talk about 100X performance boost by moving to this approach with the combination of platform computing and elastic storage. Okay, so you had to set another way that you're optimizing your systems business and dovetailing that with storage. I guess the UFC would optimize its VMware business and that's kind of their approach. True, but in that case the VMware business is the virtualized environment. The virtualized environment can often be the right answer and we do support that with our approach but often for these high performance workloads and to drive the real performance you need out of the cluster computing you want to do that with bare metal clusters and the virtualization capability is actually in the platform computing management of the cluster and the scheduling of workload across the cluster. So John and I were talking about the chessboard. The reason I went through that sort of litany is because it seems like in this business the rich keep getting richer. Maybe not doubling their pot. They don't have, you see the pure evaluation, pure storage, $3 billion valuation, wow it's eye-popping but the large companies, IBM, HP more recently but Oracle, certainly EMC, SAP and Microsoft they just keep grabbing more assets getting bigger and bigger and bigger slowly. So do you see that changing with all this disruption and flash and software defined and open source? Do you see that getting disrupted? Not in a way that's different than I have been seeing it over my 28 years here now at IBM. I've seen these cycles before where you have a phase of disruption I was involved in the early days of Java, the early days of web services and service oriented architectures. It's healthy, it kind of reminds me of the story of ecosystems of you need wildfires to burn down the trees so they get the new growth that makes the forest healthier. It's counterintuitive in some times for folks, right? That forest fire helps strengthen the forest. Excuse me, similar thing I think in the technology business. You need the phases where new technologies, new startups come in and disrupt the thinking and new paradigms emerge. Then you go through a phase of that kind of consolidating and weeding out the successful approaches. Not every new startup, wow idea, that's a billion dollar investment actually turns out to be the right answer. And then you have a period of consolidation amongst the major players and then it comes around again. And so my career, like I said, I've been in a number of times in those disruptions and it's just fun to be moving to this organization now at a time where storage is exciting again because you've got this disruption and a whole new generation of workloads that requires a different way of thinking. John Furrier, storage is sexy. Bernie, I got to ask you about this next level of sexiness is that one of the things we've been watching is this sexy movement towards large scale infrastructure. So one of the things that we're seeing certainly on the app side, the young hipsters are building out the next WhatsApp and you're seeing that take shape, that's done deal. But what about the large scale systems guys? You talked about HPC, super computing. That used to be a niche. Now that's going mainstream. That's table stakes. Do you agree and what's your take on that? No, I definitely agree and we're seeing that across all kinds of industries and the established industries. This is not only the born on the cloud new generation although those are important and I think- I said born in the cloud earlier. Born in the cloud. I didn't know, it didn't sound right. You're born on the cloud or I was born in the cloud. Whichever way, but I mean this is part of the disruption that I just alluded to, right? It's a new set of technology, new approaches, new creative ideas and what those new applications forced was if I look at the traditional storage approach and compute management approach for those new ideas it's either it doesn't work at all or it's cost prohibitive and that's really what forced the new thinking and the software to find the levels of thinking. Now what we've done is we've recognized that that change and the requirements for these new generation workloads we're also seeing in financial services banking and insurance and manufacturing with design simulations, right? They're all important and we have the technologies that have been applied to very similar problems for the last several decades actually. But really- It's all coming to a head. It's all coming to a head and we can apply those proven technologies to these new workloads to really differentiate. I mean I just see completely integrated systems coming together and we're hearing what you guys are doing is fantastic. Software is the heart of it. Not just storage, just converged data, it's analytics, all that. Bernie, thanks for coming on theCUBE. Really appreciate it. We'll be right back with our next guest after this short break. This is theCUBE live in Las Vegas. We'll be right back.