 Okay, we're back live inside theCUBE, SiliconANGLE.tv, SiliconANGLE.com's coverage of VMworld 2012. This is day one, wrap up. I'm John Furrier, the founder of SiliconANGLE.com, joined with my co-host all week, Dave Vellante, wikibond.org, the free research on the web. Dave, wrap up. What do you think? Well, you know, it was interesting. We heard a lot about the software defined data center and division and vSphere 5.1 and all the product now. So to me, the most interesting thing was, you saw that panel up there, CEOs, and that to me underscores the business angle of this whole event. You got EMC in the driver's seat, which is just astounding to me that the storage company has emerged as potentially the most powerful company in the industry. You were referring to the CEO panel that was at the end of the day, that will be rebroadcast on YouTube. Yes, the CEO panel at the end of the day, you had Joe Tucci up there with Pat Gelsinger, the new CEO, Paul Moritz, the outgoing CEO, Tom Georgin, CEO of NetApp, Michael Dell. You did not have John Chambers. He probably, you know, offered or chose not to be there. He probably was, maybe he wasn't invited. I don't know, but that was kind of, haven't heard much about Cisco at this event, but basically you've got Joe Tucci in the driver's seat, orchestrating the growth of this VMware community. Everybody up playing nice. Pat Gelsinger is now, you know, good friends with Michael Dell and everybody else. And EMC is, as I say, sitting in the driver's seat. It's an astounding. Paul Moritz made a comment on the CEO panel about Facebook, that the prediction, that the trend that he sees happening this year is that VMware's market cap will be bigger than Facebook, implying the slide of Facebook and the rise of VMware. When he started to say that, I thought he was actually going to quote your line, Dave, which is that VMware's market cap would be bigger than EMC. Well, so well. So you were on record of quoting that. Actually, my quote was that EMC slash VMware will be the next $100 billion market cap company in the enterprise. That's not a layup, because SAP's right there, SAP's ahead of them right now. But EMC owns 80% of VMware, so by virtue of its ownership of VMware, if it can maintain that. But the fact is that VMware's value over time will far outstrip, in my opinion, EMC's. So my take on the day one was obviously great. Great kickoff. I thought the morning session was fantastic. They had the drums out there, kind of a blue man group vibe going for it. Paul Moritz came out. Essentially, kind of his last hurrah as CEO of VMware. He was awesome, called the king of the enterprise. Just a lot of respect from the crowd. Standing ovation, and he passed the baton, the torch to Pat Gelsinger. A torch has been passed to a new generation at VMware. They're growing. They're thinking big outside the box of VMware, thinking about supporting other companies like Hyper-V. And really, this is the big story. VMware is now thinking bigger. To me, that was the big takeaway. Also, with Moritz and Gelsinger, the theme of old way, new way was clear. Old way being PCs and PC users, new way mobile users, that's the top of the stack. Middle of the stack where the application and the middle layer is existing apps to new apps and big data. And bottom of the infrastructure from servers to cloud. So huge transition to this new way. Obviously, another big thing, the growth as well. Riding the wave of change when Gelsinger came out, that was a keynote. Obviously, Gelsinger was clearly talking about a modern era, a Hadoop era. A big data era, an era of cloud, multiple clouds. He talked about all the different elements of a software-defined data center. Windows, Linux, database, mission critical, big data, HPC. And he said it's time to move on, Dave. It's time to move on to a new way, new experiences. And that is simply network and security, storage and availability and compute all wrapped up with management. That is, Dave, what we were calling data infrastructure. So EMC and VMware and their partners, they don't know it yet, but they just basically announced today a new era called data infrastructure. Abstract away the complexity, pool your resources, have them dynamically allocated provision and queried to automation, automation and orchestration. That is really the future. To me, that's the big story. The rest is all product announcements, vCloud, a lot of slew of announcements. But at the end of the day, this is a shift to a modern era of software-defined data center, big data and so on and so forth. It's really cool. And I think, John, my take on that is that for the last 10 years, we have seen intense focus on operational efficiency, doing more with less, cutting costs, and that's what the abstraction and the pooling and now the automation is all about. Data infrastructure, in my opinion, is about a new era of productivity where you're bringing together analytic, big data, analytic applications and feeding real-time transactional applications in a way that's going to drive business productivity. That's where IT spending is going to start to increase. And that's something that we haven't seen in a number of years. Since the NICCAR does IT matter, IT has been under fire. IT with data infrastructure and big data has an opportunity to really change that dynamic and really become a new source of competitive advantage. As Tim O'Reilly says, data is the new oil. So some personal observations on my front I want to share with you just from the schedule today that I thought was really interesting was, one was this disruption around Flash. We had some Flash startups on. We had also a great interview with HP which I thought was really enlightening because HP in this data center area around servers and networking is actually really kicking ass and they don't get a lot of credit for that. So I've been really critical of HP over the years and they still got some problems at the top that they're working through. Obviously Meg Whitman's leading the charge. He's got a transition team. The executives at HP at the top have to become technically proficient. To me, I'm really a big fan of Meg Whitman and the changes over there. But to me, the HP story, Dave, is pretty clear. They're turning the ship around. They're taking their medicine, $8 billion right off. I heard from people inside the company today that they're taking their big severance packages by August 31st. Everything was gonna be transitioning out of first wave. But the management at the top of the HP, including their board, have to be tech savvy. Okay, and I think Pat Gelsinger at the helm of VMware, that's an observation I would say is gonna be in the benefit of VMware. Other observation was how VMware was going to play out the Nacir acquisition. So on the heels of the billion dollar payout, they paid for basically an unknown startup doing some cutting edge work called software defined networking. Nacir has emerged to be the cornerstone of their strategy, which is software data centers. So I thought that was cool. And that speaks to the bold moves, Dave, that they're making. So to me, that was key. Obviously, on a fun note, David Flynn, CEO of Fusion I.O., great to see that guy pumping. They had a great quarter. We've been following them. We've been covering them since they were a private company. Now they're going public. He is smiling. He's got a spring in his step because there was a ton of Nacir is that we're nixing that whole vision of flash as a caching layer. He's obviously got that market. He nailed it when public create a lot of wealth for everyone. And he's got competition. We got violent memory systems right here in our backyard. Knock on the door and you got everyone jumping in there. So a lot of action, Dave, a ton of action. And then finally, the CEO panel that I watched was fun. Pat Gelsinger was dominant. His cube experience showing. But I thought Georgians looked a little bit nervous. Michael Dell looked like he was eager to get a word in. Like trying to get a word in and be relevant. And you can see it in his eyes that Michael Dell wants to make a statement to tell the world that he's back. Dell is not toast. And it's clear from Dell's aggressiveness in that panel, Dave, he is absolutely not going to take it lying down. People saying that Dell is a done company. So great. And I'll say to you that the general, the old man sitting back there, the old proud CEO. Or the whole thing. Fun to watch. Well, talking main and made the case for Dell. It was very passionate, impassioned case for Dell today. A lot of cash, a lot of upside in his opinion. Dell's clearly got some challenges. But I've said a number of times in the cube, Dell is dangerous, right? It's got cash. It is filling out its IP portfolio and it could do some damage. I also wanted to mention, John, I think that while I love VMware, I love the fact that the practitioners are just really so passionate about VMware. There's some real challenges here. There was a statement made in the cube today, false summit. I likened, we hear about the figure that 60% of applications are now virtualized. Of applications running on x86 are now virtualized. Somebody said, is that a false summit? Climbing them out and you think you're at the top. Getting to 90%, which is what Pal Kelsinger put forth, is going to be really a challenge. First of all, to get virtual, you need to buy physical. So there's this weird dynamic going on in the marketplace where you've got to bring in more physical to get to virtual. So that's a tough hurdle to go over. Plus, I think there's a lot of application owners out there that are still skeptical on virtualization. And then third, I think there's some competition, right? I think the VRAM pricing debacle opened up the door for Microsoft, Windows Server 12, getting a lot of, well 2012, getting a lot of early reviews. IBM's making another big push in virtualization. People aren't lying down, so you know, they're not just the world, the competitive industry is not just going to let VMware run away with it. So I think the next five years are going to really be challenging. And I think that's why Kelsinger talked about the cadence of a major software release every single year, like the cadence of Moore's law new microprocessor release. It's almost as if Pat Kelsinger read my blog post about the apps because that's one of the things that we highlighted was the fact that he could bring that application acceleration and that is a Moore's law like vibe but at an application layer. So if he can do that and figure that out, I think he'll fill on top of the VMware ecosystem and make VMware a truly an enabling infrastructure. So right now, I just don't see them there yet. They dominate the enterprise, but they are not truly an enabling platform right now, fully. So they're okay, they're not fully there yet. Things that I learned today, talking to folks, I, on a kind of a learning note, I connected the dots between something I've been thinking about for some time and that is the value of Apple computer. Apple is the most valuable corporation in the world right now. And I connected a dot on the Tarkin Maynard interview where the epiphany was, Dell was trying to figure out the services business. He mentioned the size of that market being billions of dollars. And I think the Apple story is interesting. If you look at the success of Apple computer and as Wall Street tries to figure out can that stock go any further? I would say the following. Apple has only had 8% of the market share in the PC business, 8% and they're crushing it financially. Can you imagine with the success of these products if they go double digit market share on the hardware, what that will do to their earnings? So what that means is, and the dot that I connected was, well first of all I think that absolutely I was, it's a buy for Apple stock that they will smash through their earnings. I think they're gonna go to the 15% share, maybe 20 and that's gonna create even more of trillions of dollars of value. But the connected dots was that the Dells of the HPs of the world can be the Apple of the enterprise if they keep their hardware business. Don't give up on the hardware business even though it doesn't look good right now and figure out how to wrap around that like what Apple did with iTunes and all the services. So I think Dell, HP, IBM, and even VMware if they can kind of get in that mode of wrapping around it Dave, I think that's something that I learned. So John, Apple's market cap is over 600 billion now. 600 billion, okay? And the IT market is probably what, a billion, two billion, six, something like that. So Apple's market cap is more than a third of the total value of the IT business. That's an astounding figure. With 8% market share in hardware. Can you imagine if they get to 20% consumers? So again, a little small little dot that I connected that's gonna make me think more about some of the strategies these guys are thinking around IT because if it is true that the consumerization of IT, meaning the experience of working at a company is gonna be like a consumer experience, if that is the trend, which I believe it is, then we're gonna see more Apple-like business models. And I just don't see that right now from any major player out there. I can't point to one company and saying those guys are kicking serious ass like Apple is on the consumer side relative to hardware, user experience, and wrapping revenue generating services around it. IT is ripe. I mean they got all kinds of transformations. Simon Crosby talked about security and a new way of doing things. So I think there's a lot of disruption going on. I think Joe Tucci is absolutely correct. The big disruption is happening faster than ever before. So it's exciting. The other thing I point out, two years ago we talked about the theme and we talked about the gap widening between cloud service providers and IT. And I have to give props to VMware and IT practitioners in general. They have, I don't wanna say necessarily close that gap but they've certainly plugged the holes in their organizations. Most IT organizations are on a path. They're on a journey. The marketing led the actual implementation but IT organizations are doing a pretty good job of building their own internal clouds. People call them private clouds. Things are getting simpler and so I think that hats off to those IT organizations. There's still not there in terms of self service in terms of charge backs and the like but I think there's light at the end of the tunnel for the IT folks that we talked to. Well let's wrap up day one. It was a great day. Obviously a modern era in computing as we call it the data infrastructure. Obviously it's relevant and we're going to continue to pound on that all week. Obviously big data as well Dave has continued to go. Tomorrow we got Pat Gelsinger first thing in the morning at 10 o'clock. Other notable names, Chad Sackin. We got the CEO of VCE, Jay Sri, the CEO of Arista who I'm curious to find out what she thinks about the whole software to find data centers instead of doing some cutting edge work. Ping Li from Excel Partners and we're going to have a VC startup panel right after that with EMC Ventures and possibly True Ventures and some other startups. So that's our lineup for tomorrow. That's a wrap from day one here in the hang space in San Francisco, VMworld 2012. This is Silicon Angle and Wikibon's exclusive continuous coverage of VMworld day one and that's a wrap. We'll see you tomorrow morning.