 Live from Las Vegas, it's theCUBE. Covering Discover 2016 Las Vegas. Brought to you by Hewlett Packard Enterprise. Now, here are your hosts, John Furrier and Dave Vellante. Okay, welcome back everyone. We are here live in Las Vegas for exclusive coverage of HP Enterprise, HPE Discover 2016. This is our wrap-up segment, SiliconANGLE, Home Media's theCUBE, our flagship program. We go out to the events to extract the simple noise. I'm John Furrier. My co-host, Dave Vellante, and we have a special host analyst here from HPE, Jason Newton, senior director of marketing at HPE. Welcome in as a guest host. I'm the last guy here, right? First time we've ever had a guest host. Welcome, welcome. Welcome, honored. We chatted last year, so let's summarize. Dave, stock's up. It's on a 52 week high as of yesterday. Looking good. The trainees left the station. The new station for CSC, Spin Merge. We had Chris Xu on the chief operating officer this morning, really laying out in great detail on that Spin Merge. Spin out, merge new capital structure. Still the synergies of HP still in place. Gives them some autonomy to do some M&A, some organic, a little debt. Money coming in on a dividend. Little financial engineering, a little focus. Really a good deal. Combined also with some great product announcements. The product leadership of Converge, kind of fruit on the tree blossoming. Composable, great messaging. IoT, not bad, what do you think? Well, as you know, John, I've been saying for many, many quarters now, years even, that HP's got a shrink to grow. That's exactly what happened with the split, which was great because they were able to restructure the balance sheet. And then, just recently, the Spin Merge created another tailwind, I think personally, a great financial move for the company. Took down more debt, created cash, and it's been forming 1.5 billion. I mean, so the street loves that story. Why is that important? Because to me, it positions HP for the growth company that Meg said it was supposed to be with the split. People were skeptical about that. That's exactly what we have now. A focused company with a much stronger balance sheet in a position to do M&A with a product portfolio and an R&D pipeline that's starting to hit and driving new revenue opportunities with a TAM expansion that we heard about this week into IoT with the GE deal. And the TAM is pretty significant because the analog data is significant, but there's still one shoe left to drop. M&A activity and stuff coming out of the R&D pipeline. Well, I think the- Thoughts on that, and we're seeing Chris kind of posturing saying, look it, we're strong. We're going to get stronger. And Meg says publicly that they wouldn't do any mega-acquisitions outside their core focus until they were stronger. They're looking pretty good right now. I think Aruba is a good, good proof point, right? I mean, you should go back to- And their core business. I think the important work's investment, the Hexalite investment, little tuck-in investments here and there. I think the other shoe that has to drop is software. We talk about this a lot. We had Robert Young-John's on, he was frank. He said, hey, I had to clean up some stuff. We delevered some things. So that's the real area of great opportunity for HPE, in my opinion. Jason, our guest host, HPE's perspective. Feeling stronger, what's the take? I mean, what's the analysis from your standpoint? Yeah, I mean, I think you guys are nailing it. I mean, everything is really coming into focus. Who we are as a company is becoming really clear to customers that the story's resonating. They understand the need to digitally transform. They understand that we're building these companies to be partners and part of that process. And then they see it all coming together here. They see it in real life. They see all the technologies. You mentioned IoT. I mean, that has been the hot thing this week. It's been trending everywhere on all the hashtags, Twitter, the buzz on the floor, all the sessions. Just so much opportunity. And you can see all of the different things that we bring to the table to make that real for customers and the ecosystem of partners. It's really tremendous. Yeah, and the innovation strategy behind that is coming into focus. Again, sticking to the knitting of HPE. They're staying on focus. Okay, the cloud, again, not a lot of game-changing shifting, but still on focus to be that integration hub. How is that coming together, Jason? Share some color on pre-show preparation, messaging, and he's always going through the orchestration, kind of trying to get the maximum pop on the message and the story so it's clear and coherent. Two now, looking back at the as the event winds down. What's your analysis of pre-messaging set up on giving all the stuff that's been launched and discussed here to now as a show end? What's your summary? Well, I think our message has been really consistent since maybe the last two or three discovers that we've been together. We came, I think it was almost a year ago today. We came out and introduced the focus of the New Hewlett Packard Enterprise and it was focused on four key areas of transformation. That message has really resonated with the marketplace. We've gotten a lot of feedback, we've learned, and we've, I think, further honed that this week. I mean, Meg was tremendous out there. Who are we as a company? We're a digital transformation company, right? That's what we're all about. The four transformation areas, that represents a model that we've rinsed and repeated, picked the right mix within that and enabled all kinds, and you saw story after story, retail with Home Depot, manufacturing with Boeing, born in the cloud drop box, right? We're helping all of these customers continue to drive digital transformation and she nailed it, right? I mean, she nailed that message consistently and I think one of the interesting points that we really wanted to make to people is that, why do you need a partner like a systems vendor, if you will, a technology innovator, like a Hewlett Packard Enterprise for something like digital transformation? You know, at the end of the day, you're not going to do this once. You're not just going to, hey, I did a digital transformation project and I'm done. You're going to do hundreds of these dozens, you know, thousands over the next several years. You're going to do it in your customer experience. You're going to do it in, you know, your new product development, you're creating new stuff, your core operations. I mean, the stuff that the flow serve guys were talking about it blew my mind. I mean, I'm like, there's trillions of dollars that are going to be spent on those types of industrial applications. And so you need to build a foundation. I think she used the line, yes, I'm glad she used one of our lines, the digital transformation factory, right? That industrialized foundation is what companies need to build. Because they can't just go, these can't be one-off projects. It's a great metaphor with the whole IOT meme. She also said digital transformation is a competitive necessity. The other thing that you've done, I think props to you guys, is you took the speeds and feeds off the main stage. I mean, a little bit with a cutaway, hey, let's go to Manish for a couple of bit. But, you know, I had to say three or four, discovers ago too much speeds and feeds on the main stage. Now it was all about digital transformation, new opportunities, proof points, bringing in partners, bringing in customers. So it's good. It's about customers. I mean, it's about business outcomes. That's why we're all, that's why we're spending all the money on the technology. We don't do it for technology's sake. And John, why? Go ahead, please. I mean, there's a lot of big problems that everyone now sees this tremendous opportunity to solve these problems that have been unsolvable for a long time and it's all coming together. So a huge amount of optimism and one of my jobs is to share that exciting stuff that's happening and inspire others to say, hey, we can help you do amazing things too, right? And John, one of the other things you've been talking about a lot this week is the whole developer angle. With IOT and the extension into the industrial IOT, that becomes much more important, right? Yeah, I mean, Dave, this is, you know, I'm all over the DevOps and we've been on DevOps in the big data since the beginning of this. Now, what HP is demonstrating is that it's absolutely mainstream and a real disruptive enabler for this transformation acceleration. So we're in an acceleration phase now of people actually putting it into motion beyond POCs, but really into transformative architecture. So to me, the developer ecosystem is going to be an absolute growth opportunity because it's not just like the pure play developers. Oh, they're software developers, they program on this platform. It's the merging of the vendors platforms, multi-cloud, we call it inter-clouding, like internet working. So having an enabling platform like a composed architecture allows for programmable infrastructure, which means that is the benefit of what the cloud is. Elastic pools of resources that are freely available, it's a developer dream, right? So for your developer, and you're not an infrastructure geek, you want that. If you're an infrastructure geek who wants simplicity and you don't want to manage the hell out of it and get a beep or a text at the middle of the night when you're watching the Warriors game to go in and go provision infrastructure. So that's one. Two, the ecosystem of the marketplace, the economic opportunity out there with developers is challenging. And I think what Chris Hsu pointed out that's kind of the hidden gem in all this is the funding of the ecosystem through the Pathfinder program and they're priming the pump with some of the funding. This is important because the consumer software market is softening and some say bursting. Yeah, there's some big unicorn winners but for the general purpose, there's a ton of $10 million to $100 million business opportunities, white spaces out there available today. And that's not going to be a venture-back company. That's going to be either some cash investment and or organic growth companies. And those companies need ecosystems. They need to thrive in an environment. They need scale, they need sales motions, they need distribution. This is going to be a great opportunity for SAPs of the world, for HP, for Microsoft. And it's going to be interesting because it's not a winner-take-all. It's a win, it's because of the partnering model. So I think the enterprise developer is going to be huge. Well, yeah, you're putting a developer and then back to messaging. It was no accident that Dropbox was on stage. You know, a born in the cloud unicorn to some extent was on the main stage. We had Docker in the big announcement with Docker. We had a 20-year-old developer from Harvard telling his story. That was cool. I mean, this was probably the coolest main stage keynote presentation that we've ever done. And we're a cool company, and we wanted to show it. So one of the challenges that you now have, you got all the split behind you, the spin. OK, great. You've got this June to December cadence now. You've got product coming out of that pipe and we just did the discovers. Sure. Now you've got to top this. So when do you start working on that? Have you started working on it already? Walking around talking about it. This works. That didn't. This could be better. I mean, yeah, no. Yeah, yesterday. We started working on it yesterday. Absolutely. We did our fair share of pumping cube gems out there. If you go to Twitter and search on the hashtag cube gems, you'll see all the great highlights. Of course, go to youtube.com slash SiliconANGLE or SiliconANGLE.tv. And I think what's really interesting, too. I want to point out, Dave, you and I were talking about this last night, is that there's a cultural clear difference this year around discover, HPE Discover. And that is, I call it the unshackled HPE. It felt like during the split time, pre-split, and then during the split, it felt like the employees wanted to bust out and just take names and kick butt, right? So now that's over, you're seeing now we're in our second year, it's a new company. It feels like a small company. But you feel like a big company. I heard a story, I don't know if it's true, but Meg said yesterday, kind of after, she said to a friend of mine, it's like, you can feel it. And this was important. You can feel it. Yeah, you can feel it. Well, the accessibility. So I mean, people are working, and they're like, they're just moving faster. I've had, we've had multiple conversations around the cube, and like, hey, let's do this next year. People are actually like really putting stuff together creatively. Doesn't feel like a big company. It's interesting. I think that might have a great cultural opportunity for you guys. Yeah, I mean, just again, that the focus, the energy that Meg's brought back, the exciting innovation, the way that we've, I think, made labs much more integrated into our culture. Used to be labs was very isolated and separate. And I think under Martin Fink's leadership and Meg's, that we've really brought that into the fold. And you're seeing that stuff fall into our products. You're seeing the composable infrastructure stuff, including some of the machine technology already. You know, a lot of smart people work at HPE, right? They like to do cool stuff. Final question for all of us here to wrap up the show, lightning round, hottest, coolest things of the show. Top three or top one, Dave, we'll start with you. Well, to me, the whole TAM expansion I called it, and the lever of Aruba, and of course, the great opportunity to bring that analog data, that's the most interesting thing that I take away from HPE Discover 2016, John, is HPE is a unique position from edge, everything in between, to core, to handle that sort of challenge, that business challenge. A lot of people talk about, you know, edge to cloud. I heard a data point this week, the IDC said that 40% of the data is going to, the data is going to stay at the edge. That number is much, much higher. I think it's going to be 70, 80, 90% of that data is going to stay at the edge for so many reasons, and HPE is in a very unique position to be able to handle that challenge from edge to core. So, that to me is a trillion dollar opportunity. GE partnership is interesting. GE didn't really, in my opinion, want to partner with IBM, didn't want to partner with the likes of Atachi, because it's a little too competitive. HPE was perceived by GE, this is my assessment, as a safe partner that can add value to the business that's complementary. So to me, that's a dangerous combination. Jason, highlights for you on the show. Gosh, so many, but I think you're kind of hitting on that IoT sweet spot. I just want to call out the ecosystem that to your point is kind of glomming on and adding value around what we're doing. Certainly the GE stuff, things that we're doing with national instruments, incredible demos out on the show floor with them. Docker, really going to be key to extending what we believe infrastructure is code really ultimately should be, and the synergies between that and synergy is just really tremendous. So, seeing those partners understanding, hey, we can all do this together, we can be that digital transformation partner for our customers. I think that if there's one thing, that's where I'm really excited. And the light bulbs are coming on for customers saying, hey, I need to industrialize all this capability, this edge to core, that's exactly what I need. I need the analytics. I need the applications. I need the cultural change. I need the financial support to drive that transformation. This is a partner that can do that. Yeah, my big thing is the composable is the real deal. That's grown out of a couple years of investment in the converged infrastructure, now hyperconverged and all that stuff coming together. That's real meat on the bone right there that customers can use today. I think that's, and plus composable is a word that can be used up and down the stack. That's not just for the plumbing of storage and other things, it can go up to the apps. So that's one of my favorites. The IoT with Dr. Tom Bradich, what he talked about, the edge line stuff, is to me, game changing. And I was using the analogy of the iPhone was a computer that had software to make phone calls. That was a game changer. It wasn't a phone that could do text messages and by the way, email. It was the complete reverse. And I think what HP, if this plays out, this could be a very similar dynamic in the sense that they're moving a data center to the edge of the network that happens to run an IoT device. So this is how, to me, Steve Jobs like. The size of a shoebox. You believe that's a new product category? You buy that? I buy that's new product category. And I think at the end of the day, it's all about making the data center smaller, right? And having all the apps run in wherever the hell that is. I mean, think about a telephone closet and remote office. That could be now a full on data center that used to be 20,000 square feet in a telephone closet. So that's the kind of thing I think that's game changing. The other thing that I liked that I think is going to be a real challenge for HP is the developer ecosystem. I think they have a great opportunity to win the enterprise developer, this new category, but with Haven and some of the big data stuff, they really got to move faster on that stuff. I think Robert Young-John's got a brilliant vision and I think he's got a great playbook. That's going to be something I'm going to watch. Very closely. But industrial IoT is the hook there, right? I mean, that. Well, the big data analytics makes the apps, the composable, the apps, they got to move fast with the analytics into the developer ecosystem, not try to make it a pure played big data kind of thing. I think they got to integrate that in fast. So that was my main takeaways. And of course, I agree that the TS organization, keeping that in-house was smart. Oh, yeah. No question. Okay. Guys, thanks so much. Jason, thanks for coming on. Appreciate it. Thank you. For your HP perspective. Dave, as always, great job. Thank you. Guys, great job here. The crew here and the folks back at the ranch, blogging, Kristen Nicole and the whole live blogging team. Great work. We have a zillion blog posts. Go to crowdchat.net slash HPE discover for the conversation. You can go to siliconangle.com. Check out all the blog posts. Go to siliconangle.tv. All the videos we did, I can't even count over 50 interviews on youtube.com slash siliconangle. And of course, go to wikibon.com for some great research. And of course, go to CubeGems on Twitter, natively inserted hashtag CubeGems for all the highlights from these interviews. Great job, everybody. Great job. That's a wrap here from HP Discover. This is theCUBE. Thanks for watching. I'm John Furrier with Dave Vellante, signing off from Las Vegas. Thanks for watching. We'll see you next week.