 Hi everybody we're back, this is Dave Vellante of Wikibon.org and this is SiliconANGLE.tv's continuous coverage of HP Discover. We're live in Las Vegas and we're here with Tom Joyce who's the VP of Marketing for HP Storage, a CUBE alum. Tom, welcome back. Thank you. You've been in our offices in Marlboro, you've been on the CUBE in a number of venues so really appreciate you taking some time out. How good to be here. Another HP Discover, this is the big customer event. You know, listen to Meg Whitman this morning. I thought she resonated, her message resonated better with customers than, you know, a year ago I was, there was a little pie in the sky. I thought Meg did a really good job of connecting. You know, this is what HP is, this is what we're all about. The enterprise message I thought was strong. You must have been pleased. She gave store once some props, kind of struggled with the word de-duplication which is great. Everybody does. So, but the fact that she called that out, that must have pleased you. Oh yeah, it's been a good time for us. I mean, there have been a lot of changes at HP and we've had a number of CEOs since I've been here but I think that one thing that has been pretty consistent is they've been good about allowing us to continue to execute the storage business. So, you know, some of the other changes going on. We've kind of stayed right on our plan and she, I think she came in and understood that pretty quickly that this is a large profitable opportunity and it's one of the things that's going, you know, very well for HP and so we're actually getting, you know, a lot more attention and a lot more interest from the executive team and investing in some new areas. Yeah, I was happy that she addressed that, you know, the turmoil at the top. She took that head on and I thought that a really good job and as I said, I gave you guys some props and some others. So, let's talk about, give us an update. Since the last time we talked, I mean, you guys were making a big channel moves. You guys have made some announcements. Why don't we start there? You guys made a bunch of announcements yesterday. Yeah, we did. What we announced yesterday is an update to our store once backup and deduplication, say, et cetera, technology. You have no problem. Yeah, I've had a couple of years of practice on that. And, you know, this is really kind of in many ways, you know, a big step in completing the vision that we laid out with this two years ago and we introduced the technology and we said we were going to go from kind of mid range, single node backup appliances to a big scale out high performance platform and now we've basically done that. We've delivered that and we delivered a capability to use that store once technology, not just on the backup platform, but also on HP Data Protector backup software, semantic backup software in a way that we can do a lot of the processing outboard on the backup server or even on an application server and coordinate it in a way that gives us extremely high performance. So we basically said on this high end backup system we can do a backup up to about 100 terabytes per hour, which is very fast and faster than any other high end backup deduplication system that's out there. More importantly, we can restore very quickly about five times faster than the other competitor, the EMC in particular. And, you know, so it's a very compelling value prop. I think it's a confusing world out there right now with all the different storage products and people trying to solve different problems. But if you can go in and say, look, it's going to be three times faster to back it up five times faster to restore it. You know, there's a lot of CIOs out there that are interested in, you know, restoring faster if something went wrong. So that's what we have. And, you know, that's the kind of message that I think, you know, Meg wants very clear value prop, you know, big market opportunity, you know, technology that we developed internally. She made a point of saying that we're going to get back to actually doing things that, you know, are based on intellectual property HP has, you know, that can make a difference. And so that's an example of that. And I think that's why she liked it. Yeah, I mean, I've always said, can HP get back to its roots of invent? And I think that's critical. So I want to go back to something you said, you know, the deduplication plans, the B6200. You're making a lot of claims. You're being very aggressive about it. I like it, by the way. I think HP needs to be more aggressive in its marketing. EMC is disputing those claims. They're basically saying, oh, you got to divide by four, you know, by the number of nodes in the cluster. How do you respond to that? Yeah, I think, so I think what you're referring to is some of the blogs that they put out there since yesterday that basically said, you know, this store one system can start at two nodes and scale up to eight. And they're saying that, well, look, it's really four separate two node systems. It's not one system. So, you know, if the claims are false because you say 100 terabytes per hour across eight nodes, it's really a bunch of systems cobbled together. And I think they've misinterpreted what we actually did. You know, I think they may have misread the press release or not fully understood what we've got there. You know, the fact of the matter is it is one system. It's one management system. And it's got high availability built in. So between each one of those two node systems, if something goes wrong, it'll fail over. And you compare that to an EMC data domain 990 that when they announced it a couple of weeks ago, they can go to one node. I mean, so one node system. We can go to eight with failover in one management domain. So that's a very valid thing to go do. Say, here's my one system. Here's how fast it goes. Now, we did make some decisions in terms of the shipping version of the product to kind of lock down the configuration such that it's very simple to set up and operate. You can set up a backup job to go to one of those nodes and it goes to the storage behind those nodes. And that's what they're saying is that these are separate domains within the system. You know, the reality is, we didn't talk about a lot. It's under the covers in this system. We actually used our Ibrics to scale out NAS. And you know, some things that we will be doing, you know, if customers want us to do and things we're looking at is to turn on that namespace capability and create one pool behind it. Now, those are features that we can do, but we kind of limited the first configuration of this because there's a lot of value in getting out with something that's very simple to deploy. It's easy to put in. And you know, so the first steps, that's what we've done here. So, you know, this thing isn't done. There's a lot of future capabilities and there's no substitute for having built it on top of a scale out NAS. And they're doing what EMC does, you know? They're fighting back and I respect them for it. And if they didn't come back and say your claims are wrong and we don't believe it, then you know, they wouldn't be EMC. So that's, frankly, that's what makes this industry fun is we do have some good competitors out there. You know, we're very confident that, you know, what we talked about is entirely accurate. Well, you know the playbook, the historical playbook anyway, you guys help write it. You and some of your colleagues here, although things are changing, you know, the industry's evolving. You know, we've certainly seen companies like HP and EMC and Dell and IBM even bring in, you know, through acquisition a lot of those, you know, quote unquote best-of-breed products. You've now got a whole different portfolio than you had three or four years ago. Yeah, we do, yeah. And I think, you know, we're doing well with it. I mean, we had here at HP Discover, we just had a whole bunch of investment analysts come by and the questions they ask us are look, you've owned three par for 18 months now. You know, how is it, how are you doing? You know, are you actually growing that business? And, you know, we've got a really good story there. I mean, we're, you know, in all candor, you know, for a number of years prior to making those decisions to do store wants and to do three par and some of these new technologies, our business was starting to tail off and now it's not. I mean, we're growing really, really fast. I mean, between, I think they said in the earnings announcement a week ago, between store wants and three par, those two products together are growing over 100% year over year. Right. And three par is now the largest array we sell. So more of those when we do EVAs or XP's or anything else. So that's what Dave Scott was saying on theCUBE just recently. You know, triple digit growth in a market that's growing. Well, one's growing single digits. The disk storage market and then the backup market, the appliance market is probably growing 30 to 40%. You're growing triple digits in that. Yeah, so it's a good position to be in right now. You know, our sales folks are getting excited. We have a, I talked to a couple of hundred channel partners that were here yesterday. They're excited, you know, so things are going the right direction. So there was the other thing David said was, you know, a lot of people think that we're just taking three par and replacing EVAs. We had one of your customers on from Australia earlier. He's an EVA customer buying the new system. So it's not a direct one to one replacement, is it? Well, no, I mean, in all honesty, I think the first, again, it's 18 months. In the first 18 months, the first people we talked to were a lot of existing HP customers. But about six months ago, we brought out the V-class version of the three par, which is the new high-end machine and set, you know, performance records and all those things. And since then, we've been winning competitive deals. We've been, we've replaced, you know, the leading competitive high-end arrays about 55 times in the last six months. So we're starting to win, you know, those scenarios where a customer says, hey, look, I've been using this for a long time, but we come in and we talk about, you know, the cost savings that we can drive, the performance advantage and all that. And it's actually, we're getting looked at. And if we can get an opportunity to compare ours versus what they have, it's newer technology and we're winning a high percentage of the time. I saw, and I stopped by your little area over there, the storage area, and as I was walking around the floor, and it had a, you know, three par array and a little placard that said, you know, tier one storage for the cloud. Yeah. And of course, analysts like myself and others, you know, years ago, we dubbed that whole market tier 1.5, and that's always caused some angst within those companies that are actually selling these high-end storage products. But are we seeing an evolution of the sort of definition of tier one, the classic reliability availability, serviceability is really what defines it, mainframe attach, really evolving to one that's more sort of multi-tenant cloud capable, supporting multiple applications across the portfolio as opposed to purpose-built. Are we seeing an evolution of that tier one? Yeah, I think so. I mean, I think you still need to be able to do all those things. You need to be six nines. You need to be able to replicate backup and all of those things that, you know, the tier one storage leaders, including HP with XP, and you still have to do that stuff, but there's a whole new set of requirements out there. Yeah, I think the biggest thing, the biggest change that I see customers dealing with is the unpredictability of what the next app is going to be that they're going to have to run, you know, so three years ago, five years ago, if you were buying storage, you pretty much said, you know, I've got ERP, I've got email, I've got something else, but I have a sense of what the workloads are. The question was how much capacity I need. Today, they can't necessarily predict that. Every industry we talk to, they've got new applications coming out of the woodwork. And today, it's a lot of folks dealing with, you know, bringing your device to work. You know, two years ago, there were no iPads, and now today, everybody's bringing them to work. And as that happens, there's a whole new set of workloads that need to be dealt with that were not predictable. And so I think a lot of the folks that we're looking at are saying, the customers we're talking to are saying, we need everything we buy to behave like a utility so that if there is some new change or app that hits us a year from now, the storage I buy today is going to run that. And that's what, you know, you call it multi-tenant or you call it IT as a service. It's basically the capability to say, I'm going to run thousands of apps on this system. It's a three-part system in our case. It better run everything we throw at it with predictable performance. And if the world changes before my depreciation cycle runs out, this thing has to handle whatever is thrown at it. And so whether you call that cloud or IT as a service or operating like a service provider, it's really about business agility and things that are not locked into a single workload or a single part of the market. Tom, I wonder if you could talk about the philosophy inside of HP of share gain, footprint in an account versus chasing profits and walking away from deals. Sometimes you hear execs and say, we want the footprint. Don't make price the reason why we lose. Where do you apply that mentality and where do you walk away? Yeah, that's a good question. I would tell you that in the high-end market where we focused a lot here recently, it's gotten very, very price competitive. But I think it's kind of gotten to a point where it's hit a floor. There's only so far that folks are going to give away before it just becomes uneconomical over time. I think with 3par, what we're trying to do is just focus on what the value proposition is and say, we understand what the budget target we need to hit is. What optimizations can we bring to actually work with that budget target? But still, we need to make money. We're not in this business to give things away and we're not just about getting footprint. We actually think we have a technology that's got a significant advantage. And we do need to make money selling it. So, by and large, the biggest effort that we've made over the last, especially the last six months is to make sure our salespeople are really good at communicating what that value is. Are good at going in and talking to the customer about the direction that they want to go and mapping the capabilities we have to that to create an economical offer for them, right? What came before that was a lot of competing on how much storage you need and how much capacity is required and what price we need to hit. Those days are all over. If you're competing based on this by the pound, you're going to lose and you're probably not going to make any money. But if you can go in and say, look, we have a set of needs between us and the customer. There's a lot of ways we can figure this in order to solve those needs and work within their budget parameters. It's good for them and it's good for us. So it's kind of the old adage in selling is, let's talk about the solution. It happens to be true. It's understand the needs and by and large, customers don't want us to not make money either. They want to make a five-year commitment to some technology. They need to know that we're going to be able to make the investments to do what we need to do to support them. So I wonder if you could talk a little bit about software. It's obviously, the storage business has become much more software intensive. It's a higher margin business, it's higher value. Talk about how you take advantage of software that might not necessarily sit in your group, data protector for example. AHP is obviously trying to show Wall Street for example that it's got a strong software business that's bringing in assets like autonomy and so forth and it's got to put those together and say, look, we've got a nice software business, but how do you get access to that technology, create those solutions? How does that all work inside of your organization? So I think there's actually another dimension to that. There's the external dimension. So one of the first things we did when we had three PAR on board, it was actually only about four months after the transaction closed, we announced that we had integrated three PAR with Matrix, with Blade System Matrix, now called Cloud System Matrix. And that was key because Cloud System's a big strategy for the company. Blade Systems, a big footprint out there. A lot of customers have Blade System, now they want to plug three PAR into it, but they want to manage it with Matrix and so that's something we had to do. At the same time, we had a lot of customers that also use VMware, right? So at the same time as we were doing the Matrix work, we were also working with VMware and working with Microsoft and now working with SAP also. So we have internal management software we need to integrate with and leverage, build kind of coherent solutions, but we also have these partners. So it's a complicated set of things to do, but we're trying to be really consistent about that. I think the interesting thing about HP is that there is a lot of software technology and more and more people in the company recognize that storage is a valuable business to work with. The more we have success, the more people come to us and so we had a great opportunity with the autonomy team where they got responsibility for Data Protector, they had some new ideas about integrating Data Protector with their idle platform and they came to us to work with how do we build complete solutions? So we actually have delivered that and it's good to be in a position where people in HP want to work with us and bring us ideas. And I'd say before the excitement around 3PAR and some of these new technologies we have, that didn't really happen. And so I think we have more people that want to partner with us. It's a totally different organization. I mean, we live now in this data-driven economy as that happens as a natural affinity with storage and combine that with the fact that HP has brought in so many people who understand the storage business, not just yourself, but many, many others. And so I think storage can lead. I mean, really that vision of an information-centric, data-centric, called big data whatever you want, but data is becoming a source of competitive value. I wanted to talk about Flash as well. You saw the Extreme IO acquisition, the number wasn't announced but everybody's talking in a 400 plus million. Big number for a company that doesn't have any product out. Is that, in your opinion, a signal of bigger things to come? Are we going to see a run like we did on 3PAR and Compellent and Isilon? Or is it really too early? Well, I think it's early and evolving but I also do think it's one of the bigger trend shifts that we've seen in storage in a long time. I think, and I'm maybe a little bit more aggressive in my thinking than some people, I think it's going to be widely used. I think actually a high proportion of the high-end spinning disk, the fiber channel spinning disk part of the business is going to be moving to Flash in different forms of solid state technology. I think it's a big shift and I think EMC with Extreme IO has taken a position. We've taken a number of positions. We've got a number of products we've brought out in that area and we've got a very aggressive roadmap of things we're going to do. I would tell you that one of the exciting things about storage as an industry is that when there's a big opportunity like this, the VC folks and others start to invest in it and there's a lot of startups doing really creative things out there. Extreme IO is one example. I've probably met with 20 others and so not all of the problems are solved yet. Not all of the ideas are on the table. I think over the next few years, we're going to see a wave of innovation that we're a part of. We did set out a plan and we were executing it to say first off, we need to support solid state drives on all our systems. We do that on 3PAR, we do that on left hand. We just introduced that on EVA. We said we're going to build all Flash versions of 3PAR and we delivered that too, just this last couple of weeks. We have a roadmap to go optimize that to add more performance capabilities but we've done that. We delivered an all solid state version of left hand so you can build solid state left hand nodes and scale it out with linear performance of very high numbers. We're working with the folks in our server division who have the accelerator card which I think most folks are aware is a partnership with Fusion IO. I think having solid state on the server and having it on the arrays and being able to do some creative things about processing what IOs get off and get run where is a big future that we're spending time on. So I think it's early days. I think we're not behind. I think we're actually ahead in a lot of regards. I don't think right now, given all those products we already have that we feel like we have to go out and make an acquisition. We think 3PAR is very leverageable to do most everything we want to go do in the solid state. Yeah and we've talked about software before. I personally, I think a lot of this is about the software that unifies that stack and manages that hierarchy which seems to be, you mentioned Fusion IO. I walk around and see violins get a booth out here so they're part of your ecosystem. Totally different than the server side. So that to me is the secret sauce if you will for somebody to maybe become the next veritas if you will of storage management at the flashlight. And I think the way I see 3PAR is it certainly has an ASIC and it has software but it really is software. And what does that software do? It makes it easy to derive performance across whatever media is behind it. So today you can buy a 3PAR, you can call it a hybrid array if you want but you can have SATA in there, you can have SAS, you can have fiber channel drives, you can have solid state. So in different combinations and it's the same software. So that's, our focus is probably not to invest in hardware but to take advantage of the innovation that's happening in the hardware and put our investment in software. I think EMC has got a lot of platforms. We're trying as hard as we can possibly get due to not add another solid state platform. We want to focus on making 3PAR the point at which we invest and innovate, whether it's solid state or spinning disk or some combination of the two. All right, Tom, excellent. Well, thanks for coming on theCUBE and talking about the portfolio. We're getting the hook. I'd love to talk more, always welcome. Yeah, thank you very much. Really appreciate it. All right, we'll be back with our next guest. Keep it right here. This is SiliconANGLE.TV's theCUBE at HP Discover. We're live. Keep it right there.