 Okay, welcome back to VMworld 2013. This is a special presentation of theCUBE, with special exclusive coverage of the NetApp Customer Party. We are live at AT&T Park out on the outfield grass with the anchor desk. I'm John Furrier with Dave Vellante and Jim Sankster, Solutions Marketing Cloud, 100% of the time right here. We're going to talk cloud on the outfield grass at AT&T Park. Absolutely. It's getting cold. There's mist all over the table. It's kind of cloudy, right? Happy customers for the folks who can't see around us. You got everyone just having an on the field hangout. We had the VMworld executives here. Great event. And guys, they're all here for the cloud, Jim. So the cloud is a story. All the disruption that was supposed to happen is happening right now. You're seeing virtualization go to get it mature fast. Software to find data center now coming into site. Software to find networking and play. Software to find storage. It's all falling into place. It's all falling into place. What's the next act? Some of it's actually where we've been. So I want to go back a little bit and then go forward. So our really beginning in this was quite a long time ago in the technology. We had a lot of our big customers. They were actually service providers before it was called cloud. We started building in multi-tenancy, all sorts of features like that. It lent well into these environments that also went right into virtualization as we started looking at that. Then we very intentionally put a strategy together and that strategy was for our partners and our sales teams to actually be able to say we can sell you a private cloud. We can also sell you a public cloud. We did not want to have them say on-premises is good, off-premises is bad. So we put together a program and that has really worked out well. To the day, we now have over 300 offerings in that program that we can co-market and co-sell with our service providers. So we're actually being able to have not only a whole portfolio of private cloud offerings but that 300 different offerings to choose from. Jim, you brought that up about the service providers having the cloud-like requirements and us old school guys and other people here. Oh yeah, cloud was always cloud. It was always the data center. But what really makes it a new category is the implementation and the disruptive changes in innovation, changes to the use of use, the benefits to business. So just talk about that for a minute because, and go back to the old school where, hey, a data center was a network. They had security issues. There's always data protection issues. There's always privacy. But the cloud just makes it a little different. It makes it different. And what we're thinking about are the customers, instead of having to really own and operate everything on-premise in their data center, they still have to own the data. They still have to own what we call the stewardship of that data. But now that's extending out. That's going over many different service providers potentially. They've got multiple software as a service. They need to tie that together. They might have infrastructure as a service from somebody else. They've got their own private cloud. They want to pull that all together. Yet they want to be able to still have their stewardship of that data as they do so. So what we've been working toward is being able to use cluster data on tap as that fabric that ties it all together. So your data becomes very fundamentally important in the context of how you have these clouds inter-operate together. So a lot of people think about the orchestration, the management, that's super important. And that's been a lot of what's been talked about here this week. The networking comes in, so software-defined networking. But data itself, not just storage, but data itself is really important. So I got to ask you. Dave and I were at EMC World 2010 when theCUBE actually started its life, its journey. Who knew it would turn out to be on the outfield grass of AT&T Park. But that was when EMC launched the journey to the private cloud. I don't remember the day that day. I don't remember the journey. Private cloud was the promised land. But what happened was, well, we, well, some will argue this. Private cloud just never materialized. And what people wanted was hybrid, right? So public cloud's already out there. We know what Amazon does, Rackspace. We're writing about the solutions out there, niche solutions, more mainstream, whatever. Public's pretty clear. Infrastructure service, pass, and SaaS. Data center's extension to private is basically hybrid. Do you agree, and is that the safety ground that people are building out on today? I think that's really exactly where we see it. We see it not only as what we call a simplistic hybrid, which is just a one public to your one private, but really that composite hybrid of tying multiple flavors together. And that's really where we see it coming together. Private cloud is harder than it seems. It sounds very easy. Some people kind of thought of it as just a bunch. It sounds safe. A bunch of virtualization, and that's my cloud. It's more than that, because as you mentioned, it's changing your operations. It's changing how you get toward a service catalog of IT services, and then the self-service on top of it, if you're really taking it that far. And all the processes of automation, automation, and it's non-trivial. You know, you're talking about 300 solutions before. That's a lot. That's more than I realized that you guys had. Give me some examples of some of the beta ones. When we look at the public cloud offerings that we have, it ranges from some of the big, huge names. So key systems globally providing SAP as a service to some massive customers. So that's one name brand, right? Rackspace offers some other services. Then it goes down, and we found that we had to go deeper, particularly in Europe, to a lot of regional actual providers, and then people, because they have the regulations, regulations, I'm sorry, that the data actually has to stay in country. So we couldn't just go with these big pan-European. We had to really get down in some of the smaller European countries to have multiple offerings. It might just be an offering in Northern Italy, for example. They don't even get all the way to the south. And then that would mean that we have to get into Southern Italy and work our way up as well. So that if we look at that portfolio of 300, there's quite a few big, huge names that you'd all recognize. And then there's also some more smaller boutique offerings. And then some other examples. We had some last night at an analyst dinner we had right around the corner. And we had VirtuStream. VirtuStream is also a provider of big business applications. So Oracle, SAP, but they're more boutique than say a T systems. And they do some really interesting offerings with their own orchestration that they put together. Yeah, and we've had Simon on. In fact, Simon Aspinall was here last year. Oh, great. And we interviewed him. And he was saying last night that virtually all their deployments now have some degree of hybridization to them, to John's earlier point, which, and then we were talking a lot about the discussion on you guys call it data governance and the like. We've been talking here about the whole NSA thing and prism that came up last night as well. Has the conversation escalated in the last several months as a result of some of the privacy concerns, which a lot of people sort of poo pooed or focused on security and not really so much on the privacy. Has that really started to escalate in your world? We've seen it escalate. And I think the turning point for us was really back in November when we announced the NetApp Private Storage for AWS. And what that allows us to do is actually have a customer with their private cloud put their data close to EC2. So it's the same as being able to take advantage of that elastic compute, but they maintain control of their data. It's as if their data is in the cloud, but it's not. It's actually next to the cloud at a co-location facility like Equinix. And by doing that, that allows those large customers to get over some of those hurdles where that they couldn't go to the cloud because of those privacy concerns or some of the regulations in their industry. Yeah, I mean, you guys have embraced the AWS mojo. Absolutely. We're going to be at re-invent this year. We're going to have the QPS. I mean, AWS, let's talk about that for a second because I want to talk about the cloud and the real impact of the personnel issues. So DevOps is like a mindset. And it's also a category that I would call the warriors of cloud would put themselves into. Guys who eat class, these guys are like, they do engineering ops in one. They're like the Facebooks. They're the application guys who built their own or configured their own in cloud to do that, right? Correct. So that's a DevOps guide. But now DevOps has become kind of a cultural thing where it's kind of like a category, but it's hard to do. So in the IT enterprise, what is the DevOps personnel look like? What's the kind of role? What kind of role are they doing? What is it? Is it a formula? Is it a category? I think there's some guys tend to be more on the architect side that are developing the next generation in IT. But still back to your point on the DevOps in general, we definitely see the shadow IT going on where those guys are out in front, they're using their credit cards, getting around IT. And then they're actually bringing it back, giving it to IT in terms of now you got to run this. I think we just saw a DevOps personnel which just looking for a job. That's what they're like. They're crazy. They eat class. And that's the thing about DevOps. But the thing is that most guys in the IT enterprise just aren't that good yet. I mean, there are some elite soldiers and warriors, IT athletes, we call them. But it shouldn't be hard. It should be easy. So the DevOps is a mindset. So is that cloud ops? Because the IT is going to have an operation that has to have cloud. There are on-premise data center, software and solutions. We tend to see it's the architecture team together with what have been the virtualization themes that are now charting that architecture for cloud and trying to stay in front of those DevOps teams that are going out there and using whatever they can get their hands on. And something like our Amazon solution that we have actually allows them to bridge that together. And there's going to be more coming down that road where we're going to be able to bridge those two. So Jim, you see the virtualization teams expanding that role? A lot of them. We see that kind of the predominant next step that they're taking. They've heavily virtualized. They've laid on top a lot of the orchestration. They've done disaster recovery. The next thing they're building on top of that is cloud. It's kind of a natural evolution. What was the impetus for the AWS partnership? Was that a particular customer, set of customers? Was it NetApp vision? Was it? I think it was a lot of different things going on at the same time. When we have been building that service provider program, it has been with those that are actually using off-the-shelf systems, NetApp servers from somebody, networking from somebody. And then they provide their service on top. Their intellectual property is actually inside the service they build. That might be the software they drive on top of it. It might be the efficiency. And they have a lower price. But when it came to what we call the hyperscale, the Amazons, the Azures, they're not doing that. Their intellectual property is a customized infrastructure. They are not buying NetApp. They're not buying HP. They're not buying off-the-shelf systems. And so that was an untouchable area for us. And so we have just been constantly working at how can we actually work something that's mutually beneficial to both companies? And we knew we weren't going to sell them. We weren't going to sell them an on-tap system. And so we ended up working together and coming together with what we felt was a very compelling solution. And it ends up having many of our customers starting to adopt Cloud in their direction. And we have a lot of, as you know, we're in the enterprise, we're in the data center. It helps them move that direction. You guys are everywhere. We're just talking with Cynthia Stoddard, CIO. We're talking about Shadow IT. And Dave and I have talked on theCUBE many times that Shadow IT is not necessarily a bad thing. It creates competition for IT. But also it's an R&D playground. I don't need to get approved. I'm going to just go do stuff under the table. And when it pops out, you're a hero. It crashes. Run for cover. Don't tell anyone. I mean, so that's, again, a phenomenon. That's a cultural thing. But as more and more Shadow IT becomes legitimized and then the smart eyes and ears go look at the security policies, that's going to change. So it will become a practice. Do you think that that's going to evolve to a business practice? I definitely think so. How can you take, and instead of shunning that Shadow IT, how can you let that innovation happen cheaply, fast? Turn it into a business practice. And then how can you quickly turn that back into your standard IT? It's a market opportunity. And we're trying to take advantage of that. So Carl Aschenbach on theCUBE today asked about OpenStack. And I was kind of tired. And the way I said, it kind of didn't come across great. And Carl, I apologize if you're watching. I said, well, VM, were you playing with OpenStack? He's like, playing with OpenStack. It's like a toy. Like, I'm like, no, no, no, I don't even like playing. Like you're working with it. You're contributing code. But OpenStack is a market expansion opportunity for VM. That's a direct quote that he said, quoting Pat Gelsinger. Same with you guys with AWS and Shadow IT. This is a market expansion, right? Absolutely. And OpenStack and open cloud technologies in general, we're a huge proponent. We're contributing code as well. We're contributing actual file services into the system. So everyone will be able to take advantage of that. And it's a big effort that we see if we kind of break down the different kinds of service providers, we see the traditional service providers that do use like a net app and so forth. We see those that are moving toward OpenStack type opportunities. And then those like Amazon that are at the extreme end already. But there's a fundamental assumption to that notion of OpenStack and Amazon, AWS, being a market expansion opportunity for net app and VMware, for example. And that fundamental assumption is that that capability is going to increase demand. It's going to create new value, as opposed to it's somewhat counterintuitive, because people naturally would think, oh, it's going to cannibalize. But you're betting, and I think you're right, it's like in the storage business, sales guys don't want to do compression because they think they'll sell less storage. So that's so. But when they compress, what happens? They sell more storage, if you can reduce it. So they're liking it very much. I liken it back to virtualization. Virtualization on the server side ended up selling fewer physical servers. And Wall Street thought that that applied to storage and said, gee, well, that storage, it's going to be miserable with virtualization. Untrue. And we told Wall Street that in roughly 2007, and the storage industry, net app included, benefited greatly from virtualization. I think exactly what you're bringing up, Dave, the same thing is going to happen with cloud. It is an opportunity for storage companies, and we really want to be, we plan on dominating, we plan on being in front in that regard. Jim Stankster here inside theCUBE. Hey, thanks for sharing your cloud knowledge and perspective. Honestly, net app's doing a lot of great things. We know a lot about your open stack. We want to do more drill downs on theCUBE and Palo Alto. Obviously, you guys are smoking. Got a good mojo going. Net app has a spring in their step in the cloud. You guys are doing some great work. Congratulations, of course. Thanks for having us here live at AT&T Park, home of the San Francisco 49ers. I mean, the giants. Science. And not the Red Sox. They were here in town. I went to all three games. They took two or three, my team. But special CUBE presentation. I'm John Furrier with Dave Vellada. We have one more guest and then wrap up here, live on the outfield of AT&T Park. We'll be right back. Stay with us live at the Net App Customer Party.