 Live from San Francisco, California, it's The Cube at VMworld 2014, brought to you by VMware. Cisco, EMC, HP, and Nutanix. Now here are your hosts, John Furrier and Dave Vellante. Okay, welcome back and we're live in San Francisco, California, this is VMworld 2014. This is The Cube, we go out to the events and extract the signal from the noise. I'm John Furrier with my co-host, Dave Vellante. Our next guest is Ted Newman, Senior Director, Cloud and IT Transformation for EMC. Welcome to The Cube. Thanks John, great to be back. Transformation is kind of the low-determined these days. It's kicked around, thrown around, but certainly it is happening. There is a huge transformation going on, IT, obviously affected. The global market certainly is impacted significantly by Cloud. Dave and I were just talking on our opening segment about the globalization of IT with respect to Cloud, the data, and it's complicated. So I want to get your take off on VMworld this show. How much of the transformation theme around Cloud would you put in terms of the hype? Would you put an attend being hyped up or down in single digits? Well I think we're at an attend from a hype perspective but we're actually executing now. So in terms of the reality of the hype, I think it's pretty real, right? So while everybody is talking about Cloud and Hybrid Cloud especially these days, it's not a flash in the pan, it's not smoke and mirrors. It's actually, customers are adopting it and not just the small and medium businesses but the enterprises as well. They're building Clouds, they're consuming, they're meeting with a number of different service providers and they're moving their workloads, right? Which is what we haven't seen in the past. Dave and I were at, this is our fifth year at VMworld, so our actually first CUBE event ever was at EMC World 2010 and Jeremy Burton was there and it was during the private Cloud was the big theme. Certainly he became the CMO of EMC and that next year, whole new messaging. Cloud meets big data. Very high level message but that was the moonshot at the time and there was not a lot of Cloud big data happening, it was the beginning of that vision. We're here now so I got to ask you in the transformation, not a lot of big data being talked about in the show but it is a subtext. Certainly how's that all coming together? Yeah, so I think big data's kind of stealthy, right? And I've always thought that big data is a definition of the problem rather than the solution. We want to get to big information but that's a whole other story, right? But what we're seeing is even within the VMware products within the EMC product lines, big data is a key part of almost everything that we're doing now. If you think about how do I do capacity planning in a data center with thousands of virtual machines, that's a big data problem, right? And we're building tools from a systems management perspective, from a data perspective, et cetera that all take advantage of big data as a decision aid not just on the business but it's making its way into IT, it's making its way into security and compliance and that's really exciting. Yeah, Dave and I always talk about the big data piece but it's everywhere, it's not a feature, there's no products, so here's my big data product. I mean, even in this data center, we're talking about Newtonics and you guys certainly are on this with the analytics piece, prescriptive and predictive, really relevant in the automation piece. When you think about automation and real time and policy, a lot of the stuff that goes on under the hood, this is serious stuff around power in the cloud. So what's your take on that and what are the key enablers around this under the hood automation orchestration piece because it's big data, it's flash, this is the engine for hybrid cloud. Well, and that's a great point and it goes to the point that there are more than, there's more than one profile for a workload, right? There's not going to be one Uber cloud, one big data solution. We need to spend some time on the application side of the house and I think that's one of the good things that we've seen in some of the keynotes in sessions over the last few days is we need to take a workload approach and application approach to figuring out what should run where and then we're going to build stacks or frameworks or virtual stacks to go and meet those and it's not going to be enough just to enable the provisioning of a virtual machine. You need to enable provisioning of a stack with access to big data, with access to security and compliance, et cetera and the products are there from VMware and EMC and I think that's going to be a big push in 2015. So, Ted, if I go back to 2009, Berkeley came up with a paper called Above the Clouds and I remember that right after that, a number of traditional enterprise companies, including EMC via Chuck Hollis wrote an excellent blog and the paper was called Above the Clouds at Berkeley View of Cloud Computing and Chuck gave it praise but he said, and I've got it here, he said, unfortunately it takes an extreme position that it states that it can't really be called a cloud unless it's completely external to the enterprise and so Chuck started a series of discussions and he defined at the time a private cloud which now is sort of morphed into a definition, that definition he used a private cloud is sort of morphed into what people now refer to as hybrid cloud, sort of a combination of internal, external, where you're controlling policy and security and the edicts of the organization from the compliance standpoint or carry from internal to external was all about control and then that private cloud sort of became internally focused and the hybrid sort of became that what used to be called the private cloud. So it's been interesting to see how that definition has morphed but my observation is and I wonder if you could clarify this or help shape it, customers sort of followed that path. They started with what became known as the private cloud or internal on premise cloud and now we're just really finally starting to build those brokerage services, those connections to external and it's relatively early days in that hybrid cloud. Yeah, there was maybe some DR, maybe some cloud bursting going on, not a lot of application federation. So where are we? Is that an accurate depiction? Will we ever see that sort of application federation? Is it necessary? Paint that picture for us. Yeah, great point. And I think the thing that's always amused me about definitions and trying to define cloud or trying to define big data, et cetera, is do we really want to let a government agency like NIST define what services are going to be, that the enterprise is going to be consuming? Our clients take a look at that. They internalize what they want from that very specific definition and they go do cloud the way that they want to do cloud, right? For the longest time, we saw them calling what they were developing in terms of services, anything other than cloud, right? Because I mean, there was just a stigma associated with- ABC, anything but cloud. Yeah, exactly, it was too squishy of a term. What we are seeing is, and it's been interesting to see is some of the larger customers are exiting some outsourcing agreements and those sorts of things where they're trying to take some lessons learned from the lock-in that occurred there and really use concepts like hybrid cloud to ensure they don't get in that kind of a position again. So I think the key thing, you mentioned brokering, right? Brokering is huge. But brokering without contestability isn't very good, because you're going to get yourself into that same position. You hear the term hotel, California, bandied about here quite a bit. If you're not able to define why from a business and technology perspective I'm using a certain service provider to host a workload, then my opinion, you're trapped. You made the decision for a wrong reason. And what that means is we have to sufficiently define everything associated with a workload, not just how many CPUs does it need and how much virtual memory, but what's the security policy associated with it, the cost profile associated with it, the business value it brings, and then match that up to an internal or external service provider. And you make the decision from a business perspective, not from, this is the easiest place for me to stand it up. Well, and I think that's right. I think the clients that we work with, they start with, when they sit down, when they were sitting down five years ago to write their strategic plans, they were saying, okay, let's define the attributes from a business perspective. And it included things like, we want a consumption-based model. We want a service catalog. It's a set of reusable services that could be used across the company's portfolio. We don't want to pay upfront fees. We don't want to, in many cases, do enterprise license agreements. We don't want exit fees imposed on us. And they sort of would define it at that very high level and then get into some of the details of security and compliance and the like. And that has served, I think, a lot of clients well and has trickled down now to, okay, the industry has matured to the point where we have choices other than just Amazon. And so, talk about some actual situations. You don't have to name names, but where customers maybe have followed that path and what they're actually doing with their application portfolios. So we're actually working with a few oil and gas companies, as well as a couple of financial services companies that have said, I don't want to put my eggs into one basket, right? I want to have multiple cloud providers that I have access to. I want to be able to have contestability across them. And the key there is twofold. You have to have the technology in order to be able to move those workloads between your on-premise and off-premise clouds, right? So that's a key thing. We think NSX is a great approach for that, right? That's just awesome technology. The second thing is you need to be able to apply your policies and enforce them the same way, regardless of if it's on-premise or off-premise. And that's where we think the VRealize suite comes to play and VCAC and the tools that come along with it, 90BM, allow you to set the cost profile, set up all of the reporting, the provisioning, et cetera, regardless of if this is a workload that's living internal to your data center or external. So if you have those two things, being able to easily move workloads around and being able to provide contestability based on business requirements, then you can move into that model, right, where I don't feel like I'm trapped by a service provider. I'm putting the applications I need to run where it makes business sense to run them and you're realizing value, right? You're actually out there able to make a decision based on the features and functionality that the providers give you, rather than on how quickly I'm able to stand it up there. Agility, of course, is going to come, but for too long, people were choosing Amazon because it took a credit card and a couple of clicks. Not because it's something awesome that Amazon was offering in terms of the technology, et cetera, et cetera. And so now we're in a position where you can still get the agility but make the choice based on the features and functions. So those parameters, they don't necessarily exclude public cloud, but do they require some flexibility in your security and compliance and policy edicts? In other words, many customers want to customize that to their situation. Amazon's not about customizing. They may or may not accommodate that. If they do, great. If they don't, well, you're out of luck. So are you finding that customers are, because they want to go to, say, Amazon or Google or some public cloud, Azure, modifying their edicts? Or are they saying, okay, that doesn't fit in, so we'll choose elsewhere as their combination? They're assuming mindful risk. They're making the decision that Amazon or Rackspace or whomever is good enough. And they're putting things out there that aren't mission critical, that don't require the disaster recovery, high availability, et cetera, or the customization, right? At the same time, if you have knowledge of your application portfolio to the level of, you know what requires that level of customization, you're able to negotiate with those service providers and set up a meaningful service for you to consume, right? But that's probably going to be in the form of a virtual private cloud rather than a public cloud. I got to get your perspective on some of the comments we got yesterday throughout the show. It's a multi-cloud world, infrastructure for mobile, perimeterless IT, meaning perimeterless security, perimeter security, those paradigms. So what's your take on those trends and how would you comment on what you guys are doing to make it a multi-cloud world, creating great infrastructure for mobile apps and perimeterless security? I think that's dead on. And I think it reflects the consumer expectation, the internal end user consumer of corporate IT's expectation that I get what I need, where I want, when I want it, right? And in order to be able to do that, you really have to have perimeterless security. You have to have it built into your applications. You have to provide that to your mobile applications, et cetera. All an application really is, is a gateway to a function and some data. And we've been treating them like, you know, they're the be-all and the end-all. Really, it's about how do you enable what somebody's got to do. The whole application model was 20 year life cycles. Now they're spinning up apps like it's nobody's business. They're growing everywhere. Yeah, I mean, just think about the VMworld app, right? Nobody's going to use that come Friday. But that's not a problem. It's solving a specific use case for a specific period of time. And we need to change the way we develop our applications, how we market them, get them out there into the internal marketplace, right? And how we make some decisions about what is good enough. Okay, by what you're saying, 100%, we're on the same religious theme. Are we, I'm with you on that 100%. Reality, are we there? How close are we? I mean, I'll say it's a challenge, a direction. It's directionally correct, but where are we in that life cycle? Well, so I think we've seen enterprises making great strides there. You know, there are those businesses that are born in the cloud, they're way ahead of us. We have to take what they're doing and bring that inside to, you know, large scale corporate IT. But we have the tools, we have the developers getting trained on it, and with DevOps, we have a framework that's going to allow development and operations to work better together to achieve that shared goal. Ted Neumann, EMC, thanks for the commentary, the vision and also the analysis of the hybrid cloud, some multi-cloud world infrastructure that's being programmable in real time, all this great stuff, and obviously security is a huge issue. This is the private cloud definition. This is where it's going, and again, apps are going to be everywhere. So that's an application world. So this is theCUBE, we're right back live from San Francisco, VMworld 2013, 2014. We'll be right back after this short break.