Announcer: Live from Copenhagen Denmark, it's theCube. Covering Nutanix.NEXT2019. Brought to you by Nutanix. Welcome back everyone to theCUBE's live coverage of Nutanix.NEXT. We are here in Copenhagen, I'm your host Rebecca Knight, co-hosting alongside Stu Miniman. We are joined by Dheeraj Pandey. He is the CEO and founder of Nutanix. Thank you so much for returning to our program. My pleasure. >> You're a Cube alum. Thank you. So I want to talk to you about what we're here to do, is celebrate ten years of Nutanix. Ben Gibson when he was up there on the main stage, he's the head of marketing. He was talking about watching you backstage saying that, "I saw in him a lot of pride and emotion". Because this is really your baby. You started ten years ago, there's been a lot of nostalgia, bringing up some of your first employees. And even a picture of you poised, with a ping pong ball ready to play a little beer pong back in the early days. Yup. So talk a little bit about what this means to you to be here ten years after you founded this company. Yeah, first of all thank you so much for the opportunity to come here. It looks like an era. Ten years is an era. We've built a family of customers and employees and partners. And yet it feels like we haven't achieved a thing. So you know, to me the more I make it look like it's 2010 back again, we can go back to being like a start up again and you know growing from here. Because you know growth is a very relative term you know. It's a mindset thing. And I think the new day and age of multi cloud and what we have to do to virtualize all these different silos that have emerged and to virtualize, simplify and integrate. You know, virtualize, simplify, integrate clouds is going to be a journey of a lifetime actually. Yeah, Dheeraj I think back to some of our earliest discussions. You know, you would bring us in in talking about the challenge of our era is building software for the distributed architecture that we need. And that was as relevant in 2010 or 2012 as it is here in 2019. HCI helps simplify that deployment of virtualization. We are definitely at a point that we need to simplify cloud. Cloud is here, it's growing. The hybrid pieces are there so maybe bring us inside, you know kind of, what's the same about the journey and some of it is making one click upgrades in today's environment is way more complex than it would've been back when it was just an appliance. Yeah, absolutely. And I think about the whole concept of hyperconvergence. Initially started out as converging computer with storage. How to keep them close together because machines need locality. Applications need local data, because the network is a real enemy. And the same was true of human performance you know, like lots of teams, lots of bureaucracy, very little autonomy. So when you brought data close to applications, application people became autonomous you know, they could do things on their own. And that was the power of hyperconvergence. You were able to provide performance to data and machines and you're able to provide performance to people because they became autonomous. I think that is not changing even in the hyperscaler data center environment. and I think the fact that you have to hop multiple switches to get to data, I think it's recreating the same problems that we started out this company with, you know almost ten years ago. In fact if anything the hyperscaler networks are worse than the networks that private clouds actually had or even on-prem data centers had. So keeping data close to applications is relevant and it's fashionable one more time. And the fact that you can provide that autonomy to application folks to go launch their apps in the public cloud through this new architecture using the bare metal service offerings in the public cloud. Where the bare metal offerings look like HP Silver, or Dell Silver to us I think it recreates the same. So I think I am a big proponent of the saying that says, the more things change, the more they remain the same. And they actually look very much the same as ten years ago. So how do you think that, describing the technological changes that have taken place, but really we're sort of back to where we started from. But how would you describe the ways, the differences in the ways that people work together? Talking about the human beings who are actually using this technology? Well, for one this notion of converging teams and people is similar to the notion of converging machines you know, hardware to pure software I think. Whatever happened in our personal lives with the iPhone and the Android OS, is exactly what hyperconvergence did. We had all these gadgets and they were special purpose, single purpose gadgets. And you made them as apps and they were all together in this one, sort of device. And then the device connected to cloud services. I think that's what happened in enterprise computing as well. Computer storage, networking, security, everything coming together as pure software, running as apps. And I think that has created the notion of generalists in IT as well. Because as IT matures, you can't have so many specialists. Just like in healthcare, you can't have so many specialist doctors, when you need like a ton of primary care physicians and generalist practitioners like you do. And that's what IT is going through as well. And so that's changing the skills that are in demand too, from employers because you are looking for people who are sort of a mile wide and an inch deep. Yeah and in fact the inch deep is actually not a pejorative. I would say that it's a good thing because with automation and a lot of layering of software you don't need to get deeper into the details, the weeds, especially in infrastructure computing. Because you know, what's our mission is to really elevate IT to go figure out things that really matter to the business. Which is applications and services as opposed to going and stitching together stuff that really can be done with pure software and a standardization you know. A level of standardization that operating models can bring with commodity servers and pure software. So let people go and do things that really are more relevant in this age actually. Was wondering if the close of the keynote there was discussion of the tech preview of Zyclusters. You and I have spoken a little bit off camera about this, but there is a lot of interest out there, everything, when Azure first announced Azure Stack, it got everyone excited. To be honest, Rebecca and I were at one of the Microsoft shows last year and most of the attendees weren't really talking about it. So it's that kind of the buzz versus the reality of what customers are actually using. Where do you see, where are we with kind of that hybrid discussion? And why is Nutanix taking a slightly different approach than some of the others out there? Yeah I mean this hybrid cloud is another word for hyperconverged clouds. And whatever HCI was in 2010 is what hybrid is today. So, imagine ten years from 2010 we are still talking about HCI. Especially in the large enterprises they won't barely begun to say look private cloud equals HCI. I think that's been a sort of epiphany moment for most of the CIO's of the Global 2000 companies. Just in the last three years, you've been talking about it for ten years now. So there is a bell curve of technology adoption. We are in the very early stages of what hyperconverged clouds would mean or what hybrid cloud should mean. I think doing it right is important because the market is large. The ability to really move applications and infrastructure, I call them apps now, the hypervisor is now an app. Because it can run in the Amazon platform. It can run in the Azure Platform. And that platform that they provide is billing, identity, recommendations and things of that nature. So on top of that platform how do you go and put your app in the catalog? I think that's the overall sort of metaphor that I use. So in that sense I don't look at the platform as a zero sum game for us. We just have to look at it as a platform where our apps can actually go and run. Dheeraj, how does a company, you've grown quite a bit but if you look at the overall market you're still a small player compared to a Microsoft, Cisco, or a Google out there. So we definitely think you have that opportunity to help simplify that cloud, hyperconvergence cloud experience as you said. But how does Nutanix get there? Yeah I think you know, and I say this to people who followed virtualization, the history of virtualization. When Viamer was building virtualization some of the market was 55 billion dollars. Storage was 30 billion. Networking was 25 billion. Another 110 billion dollar market. When they went to 4 billion dollars, they just had to think about what does it mean to put a layer of software on top of all this stuff? So people can drag and drop experience from one server to another, from one storage array to another and so on. So there's enough value to add, on top of that 110 billion with their own 4 billion in 2012, they were a 4 billion dollar company, actually you know. Right now we are thinking about, okay these things are the new platform. Where is the value in going and virtualizing, simplifying and integrating them all with a layer of software? That becomes a new integration software for all things multi cloud. So it's interesting. Want to connect the dots with that to Nutanix has been going through it's own transformation. And you've talked publicly a lot about you sit on the board of Adobe, that move from software subscriptions challenging. What I want to understand is, what does that end result of these subscription model, what does that mean for your customers and how they can change that relationship. I talked about this in my keynote as well. The why of subscription. I think the very fact that we've decoupled the entitlement from hardware was the first change for us, you know. The fact that software can live anywhere. And on top of that, what subscription delivers is this notion of residual value, where you can say look if I have unused products and unused terms on some of these products, can I use them for other things actually? So it provides a very agile procurement framework that is very new to the world of infrastructure actually. And you have a ton of shelfware in infrastructure in general. And on-prem software in general, even in the public cloud there's a lot of shelfware too. I think the ability to really go and repurpose stuff for new things that you want to buy provides a lot of optionality to our customers. Subscription is also about bite-sizing things so you don't have to buy big things. And delivering it in real time. So I think you'll see more and more of consumption model change toward subscription in the coming years. In talking about the value of Nutanix in this multi cloud world, and you're talking about how customers really want that optionality. We're here in Copenhagen, how would you say the U.S. customers are different from the European customers in terms of what they're looking for? Or are they different? You know, they're very similar, because there's a ton of global companies out there who have local offices and such. And so the Global 2000 has tentacles everywhere. I think in some ways where they do differ is when it comes to the partner community and the channel, the system integrators, they're actually more influential here in Europe and Asia-Pacific than in the U.S. Because most of talent in the U.S. goes and work for companies like us. And most of the talent in Europe and Asia-Pacific, they work for the channel and the system integrators. So how we actually work with them and learn from them and educate them on the transformation, I think is basically the only thing that's different. All right, Dheeraj, one of the feedback I got from customers is something that I hear at the Amazon show. I'm inundated with so much new stuff, you know. I can't keep up with it. I want you to explain a little bit, kind of the portfolio and also if you can just organizationally how you think of this. You know when we hear Amazon does their two pizza teams and they scale is very different from a traditional software infrastructure company. So-- Yeah, it's a great point and one of my favorite sort of things to think about these days is how do you not sell things, but sell an experience? It's very, very important to differentiate the two. Cause you can build a kind of things and theN the question is if you've left the integration as an exercise to the reader or to the customer and you're basically telling them, look you can add well by best of breed from other companies that integrated on your own. So the job of integration and to really sell an experience is has to left to shifted to companies like us. And that's what we've been doing with our products. We're really bringing them together. When you say, all together now, it's also about our products, actually. It's the portfolio around data, making sure that we are really bringing them all together. They can leverage each other. One sits on top of the other. One pairs to the other. They can share common policy, policy engines and things like that. I mean, what we're doing with security for example. Is bringing multi cloud with the old world of microsegmentation actually. There's a lot of integration that's going on, yet we want to provide each of these GM's autonomy because at some level, they are all looking for individual use cases in workloads. And they're looking for mastery, which is like, how do I master what I do well with my customers? But in the purpose has to be more than their own, actually. You think about autonomy, mastery, purpose. One of Dan Finks philosophy of motivation. Are general managers motivated if you give them AMP, you know, autonomy, mastery and purpose. But at the end of it the purpose is customer driven. It's not driven by product, it's driven by customers. It's driven by customer's experience rather than the general manager's things, they're actually building for customers. Yeah, just one follow-up. When I think about one of the challenges I hear inside customers, and I thought we'd made more progress is, there's still a lot of silos. I talked to customers that are like, well I've deployed Nutanix and I love it but, there's this group over here and they're doing something different and they're certified or they're starting to use it or oh, my god, this developer team spun something up and they didn't pay any attention. So IT was supposed to get everything back under control and manage it and work with the business, but I feel like the customers haven't made a lot of progress on that journey in the last 10 years. What's your feedback from customers and how we're doing? >> Yeah, that's very true. I think that what you just said is also about autonomy for the developers and autonomy for that other team and such. So you can't force fit everything into single-size, this one size fits all kind of philosophy. That's why there's a bell curve of adoption you know, any technology. I mean even today, if you think of the hyperscalers, you might think that they have it all. They have two percent of the market. And that's how big this market really is. So I think going back to understanding that each of these groups actually has skill sets that are different. They're used to doing things a certain way. And unless you go and weave it with them. What I tell people is you got to walk to where the customer is before you walk with them, to where you want them to be actually. So walking to where the customer is, is about going to the private cloud, we could easily have said, look, let's banish all this. Let's build everything and then off-prem cloud service 10 years ago. But they said the market is not there yet. Similarly we said, we got to build up line sales, because right now the white walks market is not there yet for the enterprise you know. Then when we came out of it we said, look the market is already there, let's walk with them as pure software, now subscription. We did the same with the online virtualization software below Nutanix and said, let's walk to where the customer is. Let's run on top of VMware if that's what it takes. And then walk with them to where we want them to be. Which is an invisible Hyperviser and such. So I think we've got to keep doing this where let's remove the hubris from innovation in Silicon Valley and the lot of hubris about these things that we hold on. I think when you try to go and understand and have the empathy for the customer is when magical things happening. A fantastic note to end on. Dheeraj, thank you so much for coming back on theCube. Thank you. It's always a pleasure talking to you. Thank you. I'm Rebecca Knight for Stu Miniman Stay tuned for more from Nutanix.NEXT. (quick electronic music)