 from the computer museum in the heart of Silicon Valley extracting the signal from the noise. It's theCUBE covering OpenStack Silicon Valley 2015. Brought to you by Morantis. Now your hosts, John Furrier and Jeff Rick. Okay, welcome back everyone. This is theCUBE. We are live in Silicon Valley. Right one exit from our Palo Alto office. This is Silicon Angles flagship program theCUBE where we go out to the events and extract the signal and noise. I'm here with Jeff Frick and we're for the second year of coverage of the new emerging fast growing event called OpenStack Silicon Valley. We call it hashtag OpenStack SV. The hashtag for this show is hashtag OSSV15. And come join the conversation, check it out. This is where infrastructure is being unlocked. That is the theme and our next guest is Alex Friedland with Morantis who's the chairman, co-founder of Morantis. Welcome back to theCUBE, congratulations. Thank you. Good to be here. Two fronts, congratulations on a very successful event that you guys pioneered last year by seeing a void in the market here in Silicon Valley where there are a lot of players, certainly Intel, Google right here in our backyard and of course theCUBE office in Palo Alto. It's where the action is. And there was no event. You guys really spent your own cash, funded it, brought the community together as an open community event. Congratulations again, huge buzz packed. Soon as it's going to go to Moscone or San Jose, it's so crowded. Can't even find a parking spot. And secondly, congratulations on the funding. 100 million dollars of fresh, fat financing, as they say, give us a story. Funding, we'll get to the keynote in a minute. Funding, use of funds, Intel's a new partner. Why the success? Why the tracker? Obviously they're re-upping a lot of, you know, a lot of successful endorsement, validation. Give us the update. Well, thank you. No, this is great news and this is great news for the industry. This is great news for Morantis, of course, but kind of a precursor, it all started with Intel kind of stepping up and becoming a Platinum member of OpenStack Foundation. And what was a message that for Intel, which is the foundation of the scale out hardware architecture for the cloud, OpenStack is a very, very important, you know, layer, right, that will unlock the software defined infrastructure. So Intel, in their cloud for all, is trying to make cloud easily accessible for tens of thousands of customers. And OpenStack is an integral part of that strategy. So it's great news for OpenStack, you know, as a director of the foundation. I was there when Intel was selected and Intel is putting money where their mouth is. I saw Diane Bryant here from Intel. So you get the big dogs are here, it's awesome. She's amazing, hope to get her on theCUBE. Let's talk about this event in OpenStack and what you guys are talking about on stage. Also, the theme seems to be, hey, forget infrastructure as a service, this is now about growth, maturity, some core things are nailed down, solid and emerging, things are getting steamed, the projects are growing. The same trajectory as Amazon Web Services. Some basic building blocks and things are moving fast. What's the update? Well, you've seen reports coming from the analysts. So Forester has just signaled that OpenStack in the minds of the CIOs worldwide is emerging as the fifth platform for the cloud computing transformation. So you know the three platforms on the public side, which is Amazon, Google and Microsoft. And on the private side, it's essentially VMware and OpenStack. So for, as far as customers are concerned, they don't care about infrastructure or platform, they want a platform that will usher them to the cloud that will work, that will give them scalability and they can just use with ease. And that's the challenge of OpenStack. It's gotten the mind share, now it needs to have the scale, the robustness and the partnerships to take it to the level where it's a full stack so customers can rely on it for their cloud journeys. Yeah, I said on the intro, Jeff and I were kind of kicking off the event. They had a marketing problem because it's hard to market what OpenStack is holistically. A lot of greatness and there's a lot of different players involved, a lot of different savings. But it's not just OpenStack in a box. I mean you guys have done a lot of great things there. It's a platform that works depending upon in the eye of the beholder and the use cases. So talk about that dynamic, the platform of OpenStack and this workability, the viability. Correct. Well, I mean there is an economic question that has to be solved, right? So Amazon and Google and other hyperscalers are doing amazing innovation and creating a very wonderful experience of sending workloads to the public labs. So companies are grappling with an answer what should be the on-prem answer because if that answer doesn't exist, it needs to be as good, as useful and as competitive financially then all the workloads will end up moving into the hyperscalers and the whole computing industry will become similar to what we have with the power industry. So it will be an oligopoly of just a few players and the whole vibrant ecosystem of innovators that has been driving computer industry for the last 50 years will actually be at risk. So there's a lot of people who are very interested in having an open platform where the innovation can flow freely that customers can consume and have their workloads running on them without thinking whether it's on public cloud, private cloud, whatever that is open and allows for world innovation to come in. That's why in only five years OpenStack has become such a popular platform. That's why it has all those backers because for them, OpenStack is important for their viability and it's now the time for all those people to come in together and to continue growing OpenStack into the platform that could be easily consumed. And that's a transformation from a toddler that says, will you be alive? To what does it take in the next 18 months to become the platform that everybody can easily consume? That's because what's interesting is the first wave of innovators, a lot of them have been gobbled up by the big guys. So it's interesting that they had successful exits and the big guys saw the value and are bringing them in and they're not just squishing them. They're not sucking them in and they're going away. And so I think it's pretty clear that large enterprise software companies now have figured out open source is a place they need to be. And now you're seeing a kind of a next gen of startups coming up. Platform nine, kind of the next generation of tools and services to support this growing infrastructure. So it seems to be very vibrant and it's kind of going through these little growth cycles. So this is actually, yes, it's a very important comment. So the fact that the young startups who innovated in the early OpenStack space, they were purchased by large companies who understand that OpenStack is a vehicle through which they can market and sell their diverse technologies. And those are Cisco, CMCs and IBMs. They see the value of OpenStack. It's critical to their success. What's interesting is that Mirantis is the only company out there of scale that has a different agenda. The agenda of Mirantis as a company is to make OpenStack to just be the great platform. We don't have any other products that want to sell through OpenStack. We don't compete with any of our community partners. We just care about OpenStack as the first class platform that customers can see used interchangeably with Amazon and VMware and everything else. And I believe that the industry needs an independent and scalable player like this who just has OpenStack's agenda in mind. And by the way, the Intel deal, one of the reasons we were selected as such is because we are a very powerful community player and our agenda, like Intel's, is aligned with the whole industry. We don't have, as a pure play OpenStack vendor, we are in many ways, in many people's minds, becoming synonymous with OpenStack itself. And we are the best partner to kind of drive innovation inside of OpenStack and take no favorites. So it's very important that there is at least one player like that. Yeah, absolutely. And I wonder if you can delve into a little bit some of the structure within the Intel agreement. Obviously it's a lot more than just, than writing a check. What are some of the partnership or that's always a tricky word to use in tech. But what are some of the structure of what you guys are doing together now that you've announced this deal? So, the deal consists of two parts, as you saw. One is the collaboration co-development agreement. And under that, essentially, we shared with Intel the roadmap that we see for OpenStack in multiple areas. In the areas of workload, high availability, scalability, in the area of operational tooling, and storage and network scalability and functionality. We explained to Intel our vision of what needs to happen for enterprises to be able to consume OpenStack at scale. And when we compared our visions, we were about 85% the same. So Intel that is interested in OpenStack becoming faster, the robust platform for enterprises, they said, what can we do to get this done faster? And so we had an agreement where they will put a lot of resources on their end. They will fund some of our resources to put into the community to expedite this. And also they would give us access to the interoperability labs, to their own road maps of where they're going as far as their rack scale architecture and things of that nature, so that OpenStack can truly become the first class citizen working on top of Intel-based commodity gear. So I got to ask you the question about the cloud evolution. Obviously, hybrid cloud, I asked Pat Gelsinger years ago at VMware, VMworld, is hybrid cloud a halfway house between public and private cloud? And he was adamant, halfway house, they've gotten their strategy on hybrid cloud. He called it a way station. And maybe halfway house is probably not an accurate word, but way station, a stopping ground between the ultimate destination. So I want to get your take. Does hybrid cloud exist as a category? Is it just a term used to bridge the gap between ultimately what people are doing, which is private cloud and public cloud and moving workers? I want to get your take. What is hybrid cloud? Does it really exist? So I think the answer to this question depends on who is asking. If you ask the infrastructure people, they will give you technology definition of what the private cloud is. And from that perspective, yes, technologists have a strategy how to instrument for the private cloud, quote unquote. If you ask customers, customers look at it very, very differently. Customers understand that infrastructure can be consumed as a product or as a service. So it's CAPEX versus an OPEX discussion. And then they want to see workloads to freely move from all the platforms that they use, independently of their paid for by CAPEX or OPEX. So customers just think of cloud as a notion and all they care about is workload portability and the best economic equation of how those workloads can be housed. So customers assume that cloud is going to be portable, but engineers have to design it such that the hybrid story can be engineered so the customers get their portability. So the bottom line what you're saying is customers really don't care how you define it. They pay for things either CAPEX or OPEX. That's how they buy. And two, their ultimate goal is workload mobility. Correct. Whatever you want to call that, it's going to sit on whatever infrastructure that fits how they buy economics. And for cloud, this is stable stakes. And unless we as the greater cloud ecosystem can deliver that value to customers, cloud is not going to be successful, but it's happening. And the interesting thing is with OpenStack being kind of the orchestrator and agnostic and open orchestrator, it's in the best position to be viewed by customers as the independent control plane to really orchestrate all the workloads between different platforms. So in addition to being the platform itself, it's also a best orchestration platform with all the players kind of helping to make their own platform the first class citizen. So I got to ask you the question. VMworld's coming up. Obviously they have a cloud, Microsoft have a cloud, Google has a cloud. What is the impact of cloud and virtualization, cloud engines and virtualization to converge infrastructure and some of the things that are going on in the official enterprise? What's the bottom line from a customer standpoint? Well, so if you ask customers ultimately, customers want to be separated from all of those decisions, right? They want to be able to run their workloads wherever they run, manage the workloads wherever they manage and then have the most advanced, the easiest experience using it and the compelling economics, right? So cloud as a movement provides the layer of abstraction and gives assurance that customers can have what they have. And then it actually puts an onus on the vendors to prove at any point of the decision making that their solution A is compliant to the standard interface and B is competitive price wise, feature wise and all that. So it kind of changes the game where customers become in control, whereas vendors have to prove to customers at any given point that they are the best to breed. Where before, once the customer kind of selected the vendor, they would get locked into the stack. And this is the major difference. And that's by the way, the only difference, the only way for computing industry to survive against the alternative of just purely public cloud providers who just make all the economies just so much more compelling. So final question I want to ask you in two parts. First one is, what is the impact to the customers now in OpenStack? How do they join in? Let's just say this when people on the fence, maybe doing some experimentation. What do they do? How do they get involved? How do they navigate the signal for the diversity of the noise? Well, there are many different ways, right? So more techy customers have always been trying to kind of do it themselves and also trying to innovate in the community. And that's always the way and there are multiple ways to do it with the foundation, the upstream group and there are many ways. There is a number of distributions that now are becoming point and click. You put it on your laptop, you click and it installs or you can put it in a cluster and it works. And players like Mirantis also have the unlocked appliances which means if you are a larger company and you want to consume it like you would in Nutanix box, you come in, buy it from one of the sites, put in the data center, press a button and you have yourself a developer cloud. Okay, we're getting out of time here. Final, final question, real quickly. As you put this event together, look at the themes, look at the actual attendance, look at the keynotes and the themes for the show. What is this show Silicon Valley all about? OpenStack Silicon Valley all about? How would you break down the vibe, the focus and the overall mojo of this event? So I call it a mid-cycle business event. The things are moving so fast that six months cadence is not enough and so the mid-cycle event has a lot of demand. But the most important theme about this event is that we're not here to discuss infrastructure anymore, we're here to discuss the full solution for the customers and what other partnerships we need to bring into the mind share that OpenStack has gained to really build a full solution so customers can have it as a first-class platform for their cloud journey. How well is OpenStack accepted in Silicon Valley in your opinion? Well, considering how oversubscribed this event is, I think Silicon Valley loves OpenStack. Alex, thanks for joining us here inside the Cube House, Friedland, the co-founder and chairman of the board of Morantis, fresh off the $100 million funding strategic relationship with Intel, leader in OpenStack. This is theCUBE covering OpenStack, Silicon Valley live here in Silicon Valley, our home. We'll be right back after this short break.