 Live from Las Vegas, it's theCUBE, covering AWS re-invent 2017, presented by AWS, Intel, and our ecosystem of partners. Hey, welcome back everyone, live here in Las Vegas, this is theCUBE's exclusive coverage of AWS re-invent, Amazon Web Services annual conference, 45,000 people here, huge event. This is the industry bellwether for cloud computing now, soon to be IT, public sector, IOT, AI as Amazon sets the trends, CUBE's got the coverage, I'm John Furrier, Stu Miniman, our next two guests is Barry Russell, general manager, and business fellow for Amazon Web Services Marketplace, hot and on fire growing, and Thomas Wyatt, chief strategy officer at App Dynamics, partner of AWS, welcome to theCUBE. Thank you. Partner central, a lot of love going on in the partnerships because Amazon has an enabling platform, they lower the costs, increase the value, and increase the wealth creation flowing around. You guys taking advantage of that? Absolutely, so with App Dynamics, we're helping customers with their cloud migration to Amazon. Applications really are becoming the foundation of the modern business, and understanding the performance of those applications, the users, the application, the business metrics themselves is critical as this really signifies the brand for most companies, so as they are moving their workloads over to Amazon, it's critical they really understand that how things are performing and make sure that they perform well in that new environment, and so the relationship we've had together has been phenomenal in helping that happen. I've done a lot of work though on the app side, and it's interesting in the hottest trend right now that we're seeing certainly in this cloud convergence with IT in particular, as well as other markets, I mentioned IoT and AI, obviously hot as hell as well, is the instrumentation of the data is super critical, and that is not new to you guys, but it's now becoming apparent that it's easier to do it in the cloud than it was before. What do you see? I mean, you must look at the cloud, you're like, man, this is so awesome, horizontally scalable, but all the goodness of having that instrumentation, what's your take on that? Right, so it really starts with that, instrumentation provides you the insights in real time necessary to take advantage of the optimizations that cloud provides you, so that ability to scale up, scale down, if you know how your applications are performing in real time, you take that guesswork out, and I think that's really what, leveling app dynamics with Amazon really gives you that capability the best of both worlds. Barry, the application monitoring space, you have a number of really good partners here. Amazon also has some of their own pieces. How do you balance that sort of engagement? We've seen the partner summit, I saw some really good slides up there. We've interviewed a number of the partners in this space, but I want to get your viewpoint. Well, first, AppDynamics makes their software available as SaaS, which is a pretty quickly growing trend with all sorts of customers, particularly enterprise customers wanting to move to that model. And then we work with AppDynamics to come up with a specific use case for the workloads that are migrating over, particularly with customers that are migrating large amount of workloads as they're shutting down data centers. And we make those available to those customers and provide them with a choice. And once we document that technical use case, we can put that in the hands of our essays, our solution architects, pro-serve teams, and consulting partners like Second Watch, and Slalom, Accenture, and Deloitte to help advise the customer on which third-party software meets those workload needs best. Thomas, Cisco's got a pretty sizable presence at this show. I was mentioning, this is the second recently acquired company of Cisco that we've had on the program this week. I mean, they spent billions of dollars on AppDynamics and a bunch of others. Cisco's always been an acquisitive company, but what is the kind of the acceleration of cloud mean for Cisco? How are companies like AppDynamics helping along that shift for Cisco's business? Yeah, that's a great question. I think the way to think about it is Cisco's really been helping our customers. They're networking, their data center, security, but it was a critical missing component for us was really understanding application intelligence and how end users and businesses are impacted by the infrastructure. And so bringing AppDynamics into part of Cisco, which are running it fairly autonomously, but having the ability to connect to other infrastructure-related products to provide more real-time intelligence is a key part of the strategy. So bringing those things together and then complementing that with our cloud partners and the marketplace has really made that super easy for us now from the context of making it easier to buy AppDynamics with AWS. That combination has been super powerful. Talk about the marketplace dynamics that you're trying to create, Barry, because you obviously got a good thing going. What are you doing to create the incentives, create a frictionless environment? Because I mean, obviously you don't want any friction, but you got growth. What are some of the speed bumps you're hitting? How are you addressing it? How are you working with the AppDynamics of the world? Is there incentive programs? Is there a joint selling? How should partners think about that? And then I'd love to get your reaction to Amazon's programs. Well, there's one key thing that we launched a couple of weeks ago, it's called seller private offers. And what it enabled us to do, and it's kind of a missing piece, was for a seller to work with a customer, so AppDynamics, working with a customer to negotiate on best price in terms for a longer period of duration of use, one, two, or three year subscription. That enabled the customer to get the best terms and price to run the software on AWS. And it also enabled sales teams, for example, working with Cisco and AppDynamics to sell in a way that they were more accustomed to once a customer was familiar with the software. And then we announced- Renewals of recurring revenue. Right. Right. Smiling over there. And then we paired it with the enterprise contract that we launched on Tuesday, which was a negotiated set of terms to remove a ton of friction around legal negotiation of standard contract terms between software vendors and enterprise buyers. And so we're trying to innovate between both the buyer and the seller at all times. So until you can actually voice order product, you're going to always be chipping away at the friction. Always. All right, your reaction to Amazon. How are they a partner? You can tell the truth, even though he's standing right there. Yeah. Come on. No, absolutely. I mean, here's the key thing. We've been a marketplace partner for several quarters now. We're seeing huge transactions flow through that. And as part of that, the two key things that we're finding. The first one is the deal sizes are expanding and largely because there's a lot of comfort from the end customers that the combination of app dynamics working closely with AWS, ensuring those systems are integrated that they work well together. They can be procured together. There's common bill. Those kind of capabilities have really helped us. The second thing is we're proving that we can help accelerate the pace of cloud migration. So we're seeing on average our enterprise customers are getting to the cloud 30% faster by using the two solutions together. So they like to buying methodology. That's right. And speed of deployment. The speed of deployment. And the fact that when they get there, they know their environment is going to be very stable. They have that additional assurance because they've got the performance monitoring metrics before they make the move. And then once they get there, they have it because of the app dynamics really provide you that visibility across both. Thinking about it from a- I saw the announcement, it was one click. It was an and you put up one click something. Was that a marketplace deal? I saw on the keynote yesterday, there was some one click, it might have been one click lamb, I don't know. I don't believe, I don't think it was associated with the marketplace. We do still have that feature. Yeah, so. So things are going good. You're happy? Yeah, I agree. I mean, a great example, Nasdaq spoke yesterday with Barry Heather Abbott and talked about their experience about moving their workloads over to AWS and how app dynamics was instrumental to help them understand the dependencies of their environment before they made that transition. There's so many great examples of that and that's why we think- All right, so final question for you and then I know Stu wants to jump in. Andy Jassy told me when I interviewed him last week before the event, customers vote with their workloads. What are the workloads that you're seeing moving over, what kinds of workloads fit into this new style, this new guard model of- I would say a couple of years ago it was primarily new apps building from the ground up. Now it's the mission critical stuff. It's the important things that people are running their businesses on, moving those over and then I think that's part of the reason why AppD is becoming more integrated into that is because AppD instruments generally the most critical applications, not necessarily the third and fourth tier. So the typical workloads that impact revenue, impact customer engagement are ones that are now being- So you're at the center of all the migrations. Yeah, awesome. So the one, can't let you go without asking beyond just getting to the cloud, I'm wondering what you're seeing from customers and how you're working with them on moving along from just instances to containerization and even serverless. Yeah, in the enterprise space we're definitely seeing the phase one was just move the existing VMs over now it's refactoring and reestablishing the products and the architectures based on the modern technologies like Lambda and serverless and other things. So it's all great. It's a real exciting time. Thomas Wyatt, Chief Strategy Officer at AppDynamics. Happy partner. Also the mission workloads are moving to the cloud and Barry Russell, General Manager of the place making it happen. Congratulations Barry on your success. And AppDynamics, congratulations on your acquisition with Cisco, big deal. You guys are driving a big part of their transformation. Congratulations to you guys as well. Of course, Amazon's taking no prisoners here at re-invent, 45,000 people. I'm John Forrest, do many more live coverage from day three after the short break.