Unseen why is this relevant? Why is it important when we hear talking about cloud and mobile and everything else two things one is From a marketing standpoint IBM can talk about how it's modernized the mainframe. It's all true But from a financial standpoint as the mainframe goes it really is a great Business for IBM why because it's high-margin. It drags along software. It drags along other services And so I think that's going to be a little hidden secret of IBM's business this year Just like when Windows when Microsoft comes out with a new Windows release everybody was surprised Were you shocked that Microsoft all of a sudden started throwing off more cash with the Windows upgrade cycle? No, you weren't surprised same with the mainframe. That's going to buy IBM time To bridge the gap between all the strategic initiatives cloud mobile analytics social big data Bridge the gap between the new stuff and the old kid. I got to talk about IBM's place in history You know it's your mainframe. That's a good point the mainframe to me is the secret weapon here at the stuff That here the story that no one's really talking about on the mainstream press. It is the backbone of IBM It's the computing industry. This is their their heritage, but it's evolving into something bigger for them They're modernizing it. It's it's big iron That's a term that that's been that has been called the old glasshouse mainframe days But now in a distributed computing market big iron means performance I think that's a big thing the second thing is blue mix blue mix is getting significant momentum and a lot of Energy is on underneath that I guess putting a lot of wood behind the arrow in cloud energy patents and again You know this morning top news Apple was told By a jury to pay a half a billion dollars in a patent trial they'll appeal of course They got tons of cash, but patents I've just got a ton of patents Apple is twice the value of the next public company. So IBM they can they be like Apple? I mean in the sense from a value standpoint IBM was once the gold standard in terms of stock price You can't go wrong with buying IBM. You can't go wrong with IBM blue chip stock Obviously, they got they're doing some things there Apple certainly showing the business model is direct to consumer Just kind of as a company They have to get their well their products together and deliver solutions that have high margins It's a really good point you're making but again when you go back to the sort of Gerstner days The the mainframe sort of gave them bought them time to invest in things like e-commerce and web sphere and their software business And and and I think I see the same thing happening here. I think the big question John is what does IBM come? I mean it was largely even though they didn't market it that way But it's a largely a services company the past decade Can it be your question about can it become like Apple Apple's a product company? Can IBM come become a product company and other than the mainframe? You know, what's the product that IBM has that is the number one? Product that you associate with leadership in the marketplace. Well, would you argue that Apple's a solution? It has a collection of products. I'm an Apple user. I got an iPhone. I got it. I got a Mac I might buy the watch. I'm wearables around the corner the solution is lifestyle. It's computing So so I would argue that products have to be there to make the solution. So yeah, but but Apple's got great products, right? It's got the best phone. It's got the it's gonna have the best watch It's got the best pad IBM traditionally always had great products. They were the leader But now you got to argue and say, okay, why isn't those products leadership turning into value and solutions? You say products need to be modern modernized solutions need to be tightened. Let's go through it. Let's go through it Who's got the best cloud? Amazon, okay. Who's got the best database? Well, I would argue open source Oracle in terms of industrial string. Who's number one in database? Open source, okay Who's number one in storage? EMC. All right. Who's number one of mainframes? IBM. Okay. Go through the list, right? Well, I mean mainframe. Who's number one in apps? How big is the mainframe market? Who's number one in apps? I don't know. Okay, but no, this is my point. This is my point. How big is it? So can IBM doesn't want to become a product company again? It used to used to be so you think the database company's Oracle? Well, it is Oracle's in the number one database company. How do you know? I mean it is right now Is it going to be affected? Is it going to be affected by open source? Absolutely All right apps. All right, so Microsoft. So how would you rate IBM's product portfolio? You know, Jeremy Burton at EMC said to me in a crowd chat, how are the portfolio? IBM has always had these different divisions. So this is what in my opinion when Gershner chose to go after services. He said we're going to be number one in services Okay, he chose to say, okay, we're going to have good products Great products across the portfolio. We may not lead in any one category except maybe mainframe But we're going to have great products best to breed. So the portfolio is fantastic. Okay So that's the question is what do they want to be in this next era? Do they want to be number one product company? Do they want to be a number of solutions company? No more cloud company? Here's my thing. I think I here's my take on what I think. I think IBM needs to own the cloud all in They need to go in and do whatever it takes to pull up the patents Reorganize we heard that from Nancy Pearson yesterday. The cloud is the critical link blue mix They're playing with a cloud foundry the foundation I get that it'll accelerant But they need to come in grab the play-doh shape it up and own cloud and deliver deliver everything on the cloud And then they got to win the big data solutions. Okay, we heard that from Doug Bailoff He nailed it drowning in data consumption of utility computing whether on-prem off-prem and blue mix and the cloud Division is critical. Everything else would be the pacing item off the cloud. Yeah, so what I'm calling cloud a product So I really believe so why is it John that Oracle always talks about IBM and why is it that San Thomas on us that? I don't worry about HP. I worry about Oracle. It's because of R&D and the key in this business It's a the technology business you have to take R&D and you have to translate R&D into product that sells or solutions that sell Right and you have to cycle those products very very quickly because obsolescence will kill you in this business That's why Apple is doing so well obviously in the consumer side that consumer mentality is coming into the enterprise It's here and that I think is IBM's big opportunity look at Watson It's spending money like crazy in R&D the Steve Mills billion dollar playbook play That is the key in my opinion to IBM's future Can they execute on that and turn that billion dollars of R&D into product quickly cycle into the marketplace and Leadership that will drive cash flow and that'll drive competitiveness. So again IBM. Let's talk. Let's look at this from a big picture standpoint and It's interesting Dave. They got a lot of work to do. I mean if you look at the different divisions They got a boatload of work to do now. Let me ask you a question You kind of asked Ray Wang this yesterday. You're sitting down with Jenny Right. You're in the boardroom. You're addressing that I've been bored. What would you do? What would you tell them to do? Well, I would ask her hey, Jenny You want me to sugarcoat it? We want me Of course you don't have to ask that question. Give it to me straight. Here's what I would do All in on the cloud win the cloud business number one. Okay, you got to own the cloud You got to clean up the bureaucracy Internally for for agility you got to go faster You got to own the big data fabric not necessarily be the solution provider I think the Apple deal and what they're doing with Twitter is the partnership I think the collaborative nature of kind of partnering with those big whales is right of them So do what you're doing now, but do it faster.  And what does that mean developers resources and everything the storage group You got to go to storage and clean up storage and make storage the epicenter of the action Make storage products mainstream make them relevant and go to emcee and just put out a great Product on storage and let the middleware stuff evolve around that and and I think that was what I would do Wouldn't they say John aren't we doing those things? Yeah, I think the answer is yes. I mean that's fun fundamentally you just laid out You know, maybe there's a couple of things we missed, but you just fundamentally laid out Well, I'd also tell you keep the buybacks going keep wall street throw the wolves meat You know do the buyback thing. I have no problem with the buyback people argue that that's a financial How could you not do that? Yeah, that's like you don't pass the intelligence test if you don't do stock But why do you want to have a distraction on execution? You want the wolves wolves of wall street? You want to throw them in the cage and feed them feed them the red meat Do the buyback control the flow do all those financial engine things to keep the returns going and heavily move the r&d Needle forward and focus all the execution internally to straighten narrow on cloud and everything around big data And you know everything else falls in that you look at internet of things If you look at what this was trending on on twitter today, Dave You'll see exactly the conversation space right the conversation space around the customers is You know devops cloud internet of things big data And a lot of other marketing stuff new way to work. It's just you know directional marketing But the meat on the bone is cloud and big data and everything else internet of things mobile all are part of that fabric So I would own the fabric own the cloud infrastructure as a utility vehicle And just absolutely not let amazon get an inch in in my client base. That's what I would do All right, what would you do? I think I would I would do a number of the things that you talked about that they're doing All right, but I also think you're right. They my big issue with IBM is they I said it before they've got to translate that r&d Into product right now. We've we've seen that with watson, but it's not consistent across all the divisions You mentioned storage for example A ticket take that as a good example. They've got to take their r&d and Accelerate the product life cycles. Why is a company like emc lead in a market like storage? It's because it's got Tons of products coming out now. IBM software group. I think does a really good job there The other thing I would do if I were ibms. I would figure out a way to consolidate Maybe through that middleware layer all my sass Applications, I think they've got to have a fusion like initiative or a fusion like initiative to integrate The top of that stack the sass apps. That's to me a huge opportunity for ibm And it's a big pill to swallow, but I think it's something they've got to do Okay, we will be right back into the short break with our next guest day three of wall to wall covers again full Scheduled today here inside the cube. We are at the ibm go social lounge go to interconnect go.com That's the social experience the digital experience website That's powered by the crowd all the video feeds there from the sessions the the keynotes And the cube and some of the developer action again three channels of video The rest is powered by the vip influencers and powered by the crowd amazing good stuff on there Trending stories from the crowd by the crowd that's a crowd sourced social experience And again, if you want all access to some you know d by ibm stuff you can sign up for that as well But really it's it's a great place to find out what the crowd is doing what the influencers are saying And what's going on here at the show. So go to interconnect go.com. This is the cube We'll be right back after this short break location location Here's the location that matters the most here or here or here It's wherever this is to get customers to come here and stay here You're going to need an app that connects to all your systems so they can bank shop Do what they need to do and you've got to do it fast before the competition does It's tough out here. You better be on the right cloud Today, there's a new way to work and it's made with ibm. I am Andrew Kreitzer a business operations manager at LinkedIn and you're watching the cube. I'm Chris Ellen VP of business development for HP Big Data and you're watching the cube Hi, I'm Stacy Slaughter senior vice president of communications for the Giants I'm in the garden at AT&T park and you're watching the cube I'm Thomas Minnick business intelligence consultant within our works and you're watching the cube Hi, my name is David Tishkart director of partner marketing at clad era and you're watching the cube Hi, I'm Jim you founder and CEO of bright edge and you're watching the cube First time on the cube. It's fun. We're gonna get I think what I've come to find letting my second time on the cube is I mean, it's just such a real time high energy experience. It's very good because There's no filtering of questions. I was not prepped other than saying go and get up there So it was quite good because part of the experience. I think what you're gonna get is the real answer. You know, it's not scripted It's authentic.  So I thought it was great I mean, I didn't know what the questions were ahead of time They asked some good ones. I think some ones that if it was an unbiased thing I mean a biased thing. I don't think we would have got and I think that's what people want They want those questions and it's hard for us sometimes to ask them unbiased because you're biased by nature So it's it's great to get those questions. You'll be able to answer them. Like I said, you know, I love the energy I mean these guys ask good questions and uh, obviously not only them It's the uh, twitter feeds coming in from questions from the audience So sometimes it's a question. Nobody wants to ask but they're thinking so it's good That's a great way to core sort of, you know, answer those tough questions It gave me an opportunity to hopefully share with the people watching Um, you know some of why we're doing what we're doing Live from Las Vegas, Nevada It's the cube at IBM interconnect 2015 brought to you by headline sponsor IBM Hey, welcome back everyone. We are live in Las Vegas. This is the cube silicon angles flagship program We go out to the events and extract the signal from the noise. I'm john furrier with davilante hosts Our next guest is begs wants a director marketing for IBM blue mix and we're psyched to have her back on the cube Last year we interviewed you one year ago and blue mix got kicked off It was just a beta now. It's blowing up huge And all the great success welcome back and congratulations. Thank you. Thank you It's been it's been quite a year Steve robinson says we kind of count these in dog ears feels a bit like seven And it's been absolutely exciting. So we've in the span of a year because when we met at polls We were just at beta You know, we were we were onboarding developers getting feedback and now we have over 102 services on the platform So rolling out rapidly and we have the Deployment models with public private and then we announced local at the show and it's just been it's been tremendous Well before we get into the details there's a lot of things to highlight I want to just say congratulations because we we cover a lot of companies I want to when when we meet people and they said they're going to do something and then they do it and do more And over overachieve on the on the mission because you guys were very cautious at first You got blue mix out there and then the win was at your back the CEO says we need to win cloud Right and so you get the little reorg going on Nancy Pearson was on On yesterday shows a little bit of color on that and now you got developers. You got resources at your disposal So take us through that. What happened? I mean, obviously blue mix hit a nerve Obviously Right out of the gate the scientists were pretty strong But you didn't hit that tipping point. When did you take us through the tipping point? When did it go? Oh my god, we got a tiger by the tails It was when the resources came in was it before or after? Yeah, it was a bit before that so it's really in the middle of last year So as we we had incredible adoption early on so really building blue mix from an open source perspective building on cloud foundry strong partnerships with Cloud Foundry and the team and then just onboarding service after service It's really own reddison and all the different partners that we've had and then around October was when we brought the Watson services on and we had been steadily growing You know the developer following and the baby pre-reorg or that was pre Yes, and and the teams have always in blue mix is a platform that we're serving up. Um, you know the IBM Services plus our third priority and open source. So we even though. Yes, we just reorganized We've been working across the team since day one because we have the internet of things services, which are fantastic Those are taking off really well. We have the Watson teams We have the mobile teams with the dev ops teams So we're constantly working across and now we're reorganized into the cloud unit, which is fantastic Because it just helps accelerate even more So, you know any agile business that has continuous integration like the cloud internally you have to kind of think that way And we're hearing that I internally at IBM There's a transformation to be more agile to go faster, which everyone's saying go faster. Everyone wants you to go faster I should see you know Steve said that yesterday Um Was it with the tipping point that you had success and you doubled down on it? Was there the proof point was Watson says hey look at we can do this Was that the key enabler? Yeah, the tipping point for us was Really in the early stages listening to developer feedback And making sure that we were re-architecting and designing the product that we have an incredible onboarding experience So developers were real from marketing standpoint. We were getting the word out and really focusing on building community So, you know a few months into the year we started just very small grassroots meetup groups, right? Now we have 71 countries every other week having meetups where they're building applications on blue mix So for us it was it was getting that community started And then having the community realize that we were taking their feedback on board and we would get even on our twitter handle We'd get updates saying whoa, thanks blue mix didn't didn't realize you were listening to uh to the feedback And they would mention what they had you know, tweeted at us as far as um input and how we had made the change And so every other day we're posting, you know blog posts with updates on How we're working with developers just to make it um a lot easier May can you talk about your open source strategy and how it's evolved as a company? I mean IBM was I think the first large enterprise company to get dive into open source You went in big billion dollar investment way back when the linux story is renowned, but it's really evolved You use your your muscle your money and your vision and and your open source history You know in the community, right? How was it evolved? How is it changing? IBM for over 20 years We've been driving and fueling and having engineers really involved in the open source community and helping to Move that community along lift it up and and really anything you're doing, especially from a hybrid cloud standpoint You have to have open standards. You have to build an open architecture You have to be embracing, you know all the various open source technologies that are out there You saw the work that we're doing and you spoke with the docker team yesterday And and so from our perspective is there's there's no other way It is open by design So all of our teams are very focused on making sure that we're working with the cloud boundary foundation And getting input from all of the companies that are involved in that foundation because together We are going to create, you know open standards and drive a momentum Because if you're an independent developer or even if you're a large enterprise Acting at the speed of an independent developer that you saw yesterday with city You've got to be able to move and be portable and if you're locked into proprietary standards You're just really there's there's nowhere for you to go in this new world and this all the integration that you need to do Okay, but there's another nuance there that I want to explore with you is that in the old days It used to be you'd have a committee right everybody would maybe pay to get into the committee And they set a bunch of standards and nine times out of 10 or 99 out of 100 that it would flop And people a lot of people said that would happen for instance with cloud boundary You guys came in and gave it a big lift. They're talking that way around the open data platform now. So What's the difference is it just that there's an open source component to it? Is it that simple? It's the community So I mean open source is successful because of the community Listening to the community ensuring the community has a voice and then the companies that are involved at you at Maybe more of a you'll see to the table from a leadership perspective with the foundations It's their their role and their mission to be listening to the community and bring us forward if any of those fail And you know the companies involved aren't listening to the community or the community is not engaged It doesn't feel engaged and they're not innovating the platform It's not going to work. So that's why we're very focused on building a sense of community listening to what's out there and then Enhancing so you know the announcement with docker around enterprise grade containers We were very specific with the way You know we approached that and named that and you look at you know the secure gateway that needs to be added You look at the enhancements we've made from cloud boundary on auto scaling So really looking at what is the community looking for and then how do we then you'll pay it back So what's the message to developers? I mean, it sounds awesome. It's not easy what you just described Just oh, yeah, let's get the community. Well, it's hard to build community So what's the message to developers? They have a lot of choices a lot of options.  From an open source standpoint Just to be involved be committed be and there are projects every day within the open source community Where you can contribute code and you can be involved and it's really about Being very active and vocal and having having a seat at the table So I mean our teams were constantly looking through stack overflow and the feedback that we see there Feedback on reddit feedback on github, you know, how how often is the code being forked blood? What kind of adoption metrics are we seeing so from a developer standpoint? I would say it's time to lean in and be very involved because I mean not just IBM But all the companies that we're working with across Absolutely listening and I mean this is It's such an era for developers where they have a seat at this your big community table It's not easy, but it's the right thing to do It's about the docker and the reddit so this is modern stuff that developers want Dockers the hottest trend, you know, it's talking to docker folks We interviewed Solomon years for a couple years ago in the queue before they changed their name even was like And we're so excited and all of a sudden they're now the the bell of the ball As you say everyone wants to get married with docker reddit also is compelling node These are cutting-edge technologies that are part of the integrated stack So how do you guys talk about that in contrast to say amazon because amazon and developers Are used to these things elastic means that they have a auto scaling. What do you guys have now that's Directly competitive with amazon? Well from a from an application development standpoint I think where we've gotten advantage is you look at the history of IBM around dev ops, right? So bringing together development operations in this continuous delivery life cycle and really looking at how are you going to quickly build an application? And then that's that's not the end of it, right? You now have to make sure from a security standpoint Or you know and you've heard from mark van denhoff yesterday and the team on how are we Providing strong security tools where you can do, you know in-process application scanning and then you've got to deploy You've got to auto scale you've got to bring it back and you've got maybe an issue You've got to remediate and then redeploy so for us It's really looking at at mobile app development and web development in that developer life cycle And then in our conversations with our partners the open source community It's ensuring that we are helping to accelerate that every step of the way I mean the announcement around api harmony great example where we've got kind of the era of the Impatient developer and we're all of us where you don't want to spend time writing a lot of code But it's already been written you don't want to spend time, you know creating integration and creating apis If they're already out there But you need or the tools at your fingertips where you can quickly build an application search all the apis that are available And your private apis you know connect that into your mobile applications So you're to market faster and then it's about you know enhancing and uh, you know and really bringing differentiation So what do you say the developer out there that's watching? Let's give you the the profile. Yeah, I'm comfortable with amazon I'm not sure I should go on bluemix Maybe I should maybe the best move is not to move Or maybe they have something I want that I don't know about so talk about those two scenarios because like they're comfortable They're like, okay. I'm fearful moving over because I'm comfortable over here with my tooling You know developers are as you work with them and then there's also the fear of missing out Like can I do better on bluemix? So that's the common theme that we're hearing on developers So how do you how do you talk to those specific points? Yeah? And we uh, we have those conversations quite a bit and it's really about looking ahead at your strategy and at what point especially for Developers within large enterprises at what point do you need to connect with the back end systems? At what point do you need to ensure that you've got secure connectors or european clients or latin american clients? Big concerns around data privacy, right? And so how are you sure that even the data centers that it's hosted in you know? We have 40, you know data centers within software and growing every day And those are you know owned by ibm those are secured And it's really looking at where are you going to go as you expand your application And do you have the right partner in place the right steps along the way that you can And more importantly that you're not locked in because as much as I mean We have a lot of heart for bluemix and what we're building We want to ensure that we've built it to be open because we also want to have you know low barrier exit We want to make sure it's a great experience And it's our job to make sure that we've got the right services the right technology So you know they don't feel locked in absolutely. So the lock-in is the lock-in is a satisfaction. It's a It's a experience. It's not a oh, I can't move because it's going to be too expensive to get out Right and there is A sense of expense that we're starting to see around the hidden cost of data And as you may have walked into what you thought was a freemium model with some of the providers that are out there And you're scaling and now you have an ornament amount of data coming in and you're looking to store and provision that We are hearing the there are hidden costs there that are also kind of opening the door to other players that we've We've we know that we understand what you're going to be facing down the road So we've built the the pricing application the platform to allow for that Whereas there are other platforms that haven't because it is you know working at that kind of volume and scales a bit A bit new to them. Well and having to move that data is a problem too. That's what you mentioned 40 data centers The more than the merrier I say Give us some of the statistics. What's happened? How many services we did a little bit yesterday go a little deeper What's exciting? What are the the the proud pieces of the the platform that you can share the developers? Yeah, it's been the integration the tight integration between The design teams and and listening to developer feedback And then constantly designing the platform to have an amazing onboard experience So we announced yesterday the the watson zones and the internet of things zone and these are really designed to be A way to onboard into blue mix for developers that give you all the tools and resources and training that you need In order to start using cognitive applications like watson because it is as exciting as the watson services are You do have a moment where you sit back and think How am I going to use the power of watson in my application? So we're creating these onboarding zones. So that's been huge advancement really excited about that You're going to see a lot more zones come out for us this year and then the area of internet of things So we have our iot services You had nigel and ian on yesterday from silverhawk. How about racing? With internet of things. They're fantastic. Tell me about business outcomes Get to finish the race and win, you know win but finish the race And you have the monitors on so you know if your heart rate's going over That's very important data And so so what we've seen so the exciting areas are really the zones and then the adoption and growth around internet of things space And it's it's funny our our teams of developers that are out working with clients and out working with startups If you open up their bags, you're probably going to find a light bulb a pebble watch A bunch of connectors. I'm surprised anybody can get their security nowadays that's on our team because we have all these demonstrations that we're doing with clients of You know imagine if you have as you're trying to create a smart building for your employees And you have their mobile devices that are You know sensing and and pinging the the thermostat system the lighting system in the office And as they're driving in and getting in proximity things start turning on inside the office So we do demos with light bulbs and watches and and really are starting to think through A smarter planet and smarter cities initiative with internet of things And how are you using bluemix and the power of cloud to you know bring that to life within within cities and within enterprises That's crazy. Go ahead. What's the developer persona look like these days?  They are in in the fact that a lot of large enterprises are building innovation centers inside of themselves And so they have Whether if they have foundries or innovation centers or groups of developers They're really looking to harness that that speed and uh an innovation that we've seen from you know Some of the enterprise developers and then also the big advancement that we've seen is the continual growth of the hackathons So, you know, we know city we've been partnering with at&t as well on on creating as many opportunities for their internal developers And external ecosystem of developers to be bringing forward new ideas to them And then what we we don't talk about as much publicly are the internal hackathons we do inside of large corporations So we we work with the cio's office. We go in 24-hour period and their developers are working on bluemix within 24 hours Well depending on the number of developers they have we'll have you know 50 75 100 mobile apps that are built And then shark tank style, you know, they pitch the apps to their cio and we vote on them together You know with the company and then that's the roadmap for you know, their 2015 plan on what applications they're going to bring to market So talk about the geekiness of IBM and we were talking about this on the intro about what IBM should be doing obviously we're we're editorializing and pining but It's known as kind of like the big company the slow old IBM big blue big iron and you guys are trying to be cool to the keynotes out here We see that but you guys actually have a geeky kind of community going on with this dev thing Which we've been following the past couple of years. It's pretty cool um IBM is a geek culture. I mean it's got a lot of geeks at IBM and that's a bad word we heard in new york but a lot of computer scientists um technical people Very awesome bench talent and patents right so all that's coming to bear we're hearing So share with the folks out there that are watching. What's it like at IBM? It's geeky Is it is it you said they carry gadgets around? I mean is that the way people are at IBM? I mean, what's the culture like it is your group is I think one of the ones that are kind of the edgiest I think it's definitely not a model culture at IBM I mean this multiple pockets mean you got a conservative customer base, but like to be good you got to be yeah That'll be kind of Well, it's about being authentic. So we're not trying to be anything. We're not and when you look at me You met, you know the teams that I'm going through we got justice lawyer Marvin Goodman running around here on our teams and And we have massive development labs, you know of developers within, you know High-fun our our london facilities and this is going on every day So we're not putting on airs. We're not pretending this is truly what our teams are doing So we have, you know, joshua car in the uk is constantly with um, you know With children in schools showing them how to fly a drone with a banana right where you do the device connectors That wasn't because it was a stunt that we were trying to pull it's just truly what they do And we're very involved in the STEM initiatives for schools Very involved in you know, our distinguished engineers working through so But they attract developers and to get them ingratiated into your platform on board You're judged by the company they want to see themselves there, right? So that's a there's a culture of developers now I don't want to say brogrammers, but like and the young guns are like they've never loaded linux on machines They always say what loads off work. Like it's all clouds of them. So they're born in the cloud So that's just a complete cultural shift, right? So talk about you guys have that mojo internally or Yes, it's about It's about taking what we know inside the company and exposing that to developers and creating that developer to developer connection And you mentioned brogrammers and we have lauren schaefer We have a number of female developers on our teams and we are very much focused on Ensuring that we're leading in making sure that we are creating a very balanced STEM environment of developers and And leading in that area of making sure we have a lot of diversity And so it's really about from a marketing standpoint It's you know, you don't market to developers, right? Yeah, no your technical chops are what's the market and you make sure that what they're interested in and what they're after We're going to connect them with an IBM development team or Is somebody else in the community through developer works that's working on it as well And it's that local community. There's local connection.  I mean we are I mean ebc shifts inside of IBM marketing It's all data driven. I'm using the entire portfolio staff's portfolio We have with you know, unicode chrometrics and and every day Can't go wrong by giving developers more tools and more technologies to play with right like a kid in the candy So right I asked you the the the question that's on my mind is what was the big learnings over the year that you guys Walked away. What was magnified this year? I'll see you launched a year ago. You have some growth Right, what's the learnings that was magnified for your team and the whole group I'd say the speed So when you talked about, you know agile development agile delivery you look at going from, you know, a few services to 102 You now have to reinvent The way product development is done inside the company So it's cloud first it's mobile first and it's really looking at across all the services We have how long can they be a beta how long, you know, are we going to do testing? What is the beta to general availability onboarding for developers and migration path because a lot of companies will Launch a beta You're using the beta you're embedded in it and then all of a sudden it goes generally available and you have to rip and replace Like that's horrible and you know an experience So we've the biggest change I've seen is just the agile delivery and the speed at which internally to IBM We're working and learning from our partners that we're onboarding and bring more and more partners every day We got a break but I want to ask you one final question. What's the coolest thing you guys have done with bluemix internally? So internally it's been the Watson services and the Watson hackathons. So we Are doing message resonance and sentiment analysis. So you can actually take memos that are written or Our external documentation run it through message resonance and start creating profiles of messaging. So it's been So you've got traditional writers, you know geeking out of it In that they're up learning their content into the mobile applications and And you're then changing the way that they're right. We did a test adam Sent this in a link for the beta with bluemix and we took all our crowd chats The social group has an amazing crowd chat zillion people on it. There's a huge transcript I just cut and paste the transcript into the the site and it spit out like the top things and it was like You know openness because it's a twitter twitter chat and it gave a little all the sentiment Right. I was like, wow, this is awesome. So we can see where this is going. So That's cool. Yeah, that's been great. Thanks for coming on the queue again. Great to see you. Congratulations and keep us posted And we'll pull up keep checking in with you on the progress This is the queue. We'll be right back live in las vegas after this short break Is a live mobile studio you bring it to events and we say we extract the signal from the noise What we do is we get the absolute best guests that are at those events We bring them inside the queue and we talk to them. We have a conversation I think the difference with the cube Is that the interviewers are active Participants in big data. So it's less about trying to explain what big data is And more about relating what's going on. So we're a big data driven organization We have a data science team that allows us to see not only what's trending broadly With the public but what's trending in very specific areas in our specialty in tech That allows us to vector our analysis and relevance From our research and journalist team into everything that we do as a media company We really want to make it fun exciting But more importantly extract the data from the guests and extract that metadata and share it with the world So people can use that information to better themselves better their companies more importantly connect with other people To do more business to define more about the technology and for us. This is the future I do a lot of these types of interviews. I spend a lot of time with the press and it keeps a lot of fun It's you know, ESPN for tech I think tech's evolved to the point where you know, people want to understand the personalities behind the technology Which probably wasn't that interesting 20 years ago And I think they've made it a lot more a lot more entertaining a lot more interesting as well as you know Putting some technical need on the bones as well The value of an independent news organization at an event Is that it allows our audience to have a perspective that's balanced that it's not just you know, the vendors talking to them It's the community. It's analysts. It's technologists. It's customers practitioners. So they get a full perspective That's unfiltered the benefit of the cube is Place for conversations for people to connect with each other and and to Learn about things and uh, it's a revolution in media We look at the technology and the people behind it as tech athletes Those are the folks making the companies making the technology really creating the new value in this modern era And it's fun. It's exciting and more importantly. It's very social these days With social media people looking to not just read articles, which are great and obviously silicon angle does a lot of that as well but being able to see high definition video Very intimate interviews with entrepreneurs and operators Innovators in the industry. I think it's really important. So the job you do and getting this out in a very timely way I think is really important. We always know that your view is right until you hear a different perspective So you're always interested and give me some neutral perspective Help me see it from a different light, right? I may be asking a hard question or two that I might not have considered it You know in that sense right that independent voice that's always ability to right have uh, you know, sort of independent audited sort of perspective right of the world. It's always just good The cube has been called the ESPN of tech and really our vision is to cover Every event that's out there We really truly want to be a global organization that is at every event extracting the signal from the noise Being on the ground giving our audience a sense of what's happening at that event But also providing analysis and insight worldwide literally for every event that's out there You know, I love it. I was actually telling uh, John and Dave every time I come back to the cube You guys have new toys new cameras. Everything's getting bigger. So, uh, you know having been on it for Several years almost from the very beginning. It's uh, it's always great to be back and You know, you guys do an amazing job. So, uh, it's wonderful It's about connecting with people And that really is what it's all about Having the conversations in a very social collaborative way and that's what makes it so exciting how people are watching It was my first time on the cube. It was fun. We're gonna get to it again Yeah, I think uh, what I've come to find letting my second time on the cube is I mean, it's just such a real time High energy experience. It's very good because uh, there's no filtering of questions I was not proud other than saying go and get up there. So it was quite good. It was part of the experience I think what you're gonna get is the real answer You know, it's not scripted. It's authentic.  So I thought it was great I mean, I didn't know what the questions were ahead of time They asked some good ones. Um, I think some ones that if it was an unbiased thing I mean a biased thing I don't think we would have got and I think that's what people want They want those questions and it's hard for us sometimes to ask them unbiased because you're biased It's my nature. So it's it's great to get those questions and be able to answer them Like I said, you know, I love the energy. I mean these guys ask good questions and uh, obviously not only them It's the uh, twitter feeds coming in from questions from the audience Sometimes it's a question nobody wants to ask but they're thinking so it's good That's a great way to core sort of, you know, answer those tough questions It gave me an opportunity to hopefully share with the people watching Um, you know some of why we're doing what we're doing This is a burrito made with chocolate soybeans and apricots What kind of chef comes up with this? A chef working with IBM Watson on the cloud Ingredients are just data Watson turns big data into new ideas And not just for food Watson is working with doctors and bankers to help transform their industries Today there's a new way to work and it's made with IBM Live from Las Vegas, Nevada It's the cube at IBM interconnect 2015 brought to you by headline sponsor IBM Welcome back everyone. We are broadcasting live in Las Vegas for IBM interconnect This is the cube special presentation from Silicon angle. We're on the ground We're structing the Sims with noise and sharing that data with you. I'm John Furrier My co is Dave Vellante. Our next guest is Mitch free worldwide i2 national security and defense lead at IBM Um Welcome to the cube. What's i2 for the folks who don't know explain what i2 is and we're going to talk security You get the black hat you got the the symbol. I mean Let's get into this. Okay. So i2 is one of ibm's premier products in the safer planet organization, which is part of ibm analytics And i2 has been around for about 25 years. It's an intelligence analysis Tool that's been used by 4500 customers around the world Anyone from national security police organizations the security exchange commission Anyone that's going after people who are black hats or either on black lists So any of those nefarious characters that are causing problems on our planet? This is what safer planets all about we love security. Dave and i we would probably spend the next whole day Just talking about this topic, but let's just start with some basic stuff going on in the industry Perimeterless security is now normal in the cloud the old ways, you know, put the bar the door mode protect perimeter All changing so that we see a lot of new technologies like apis and notifications and mobile apps opening up lots of doors There's traditional holes. You have all kinds of stuff, you know last week the whole thing was going on with Lenovo Oh, I've got something look for those that these these back doors So there's a lot of stuff going on from back doors trojans to now new ways that apps are accessing databases So comment on that trend and we're customers and all because they're like run run run build maps tough wine revenue You know, it's mobile apps. It's all great for the business, but then all sudden wait a minute There's also a back side to this what yeah, absolutely So if you look at kind of the customers and they do exactly how you're saying so In it in this mandatory you have to have the moat you have to have the defenses You have to have some of the security Solutions that are in place now and as you know iBM security systems has world class solutions that do that but what we're seeing in the industry is That now organizations let's take for instance commercial organizations They're looking more at who or who's doing the attacks. Why are they doing the attacks? Whereas before it was simply I was there was a breach. I need to do damage control I need to close the hole I need to fix this and then I'll do some remediation after the fact to actually prevent that from the next time So there was not a lot of focus on Attribution meaning who is actually attacking me? Why are they attacking me? Are they connected to a wider organization? So if you take uh, let's say public safety or government organizations That's always been their focus now the commercial organizations are saying How do I find out who's attacking me? Well, why because they want to start to get ahead They want to find out their modus operandi They want to take that and plug it back into their remediation techniques so they can perhaps pick them up Faster. So if you look across the board most of the time when there's a breach that That breach has been taking place for about eight months. So explain breach and incident. There's two different like a breach is like Bad incident is like Less bad than a breach. Well, uh, I think it Certainly a breach would be a form of an incident and so there's a lot of incidents that go on So there's a lot of false positives. I mean the number of alerts that the security operations centers see every day Are just absolutely through the roof and they don't have time to check all of those So an incident could be something as uh, you know, someone trying to do a denial service attack A breach as you said is more serious when they actually get in the door and they're they're uh going around in the background Tempting to exfiltrate some sort of data or do some sort of malicious damage in sight And you said on average that's eight months before an organization Well, on average we're seeing uh, yeah eight months and and each one of these attacks from a commercial perspective Is upwards around 11 million dollars. The classic quote is well, sorry Dave, go ahead Well, go ahead. I'd love to hear this quote the classic quote we heard on the cube Um, the bb reported is from the uh from the government. There's two types of companies Those have been hacked by china and those that don't know they've been hacked by china So so and news today china's dropping sisco and some, you know, big news out there It's like so there's a hacking war going on and so you a company can be out there Not even know that there's a super fish going on and there's super fish being a latest exploit Going on. So like, okay, I know I'm hacking. I got a deal with that now. I'm like, wait a minute. Do I have something going on? You can't solve all the you can't plug all the holes. What do they do? What do customers do with this? So you you can't plug all the holes and and I won't necessarily comment on any particular country But I would say the quote is in fact correct meaning are there those that have been and those that that will be hacked Uh, and it's a question of what's going to happen once they're inside So what companies are starting to lean towards as I mentioned earlier is they're starting to look at attribution So if you take attribution, I want to find out who's actually behind the attack Because if I can find out who's behind the attack, it's just like tradecraft and a natural security organization I want to know the enemy. I want to know what they're doing what their weaknesses What their strong suits are then I can start to take some preventative action So we want to move from being reactive to proactive So how do we do that and the challenge is that a lot of people are focused on as you mentioned the moat and the defenses We need to start taking in data other than just the cyber data. So the traditional it data. So Vendors including IBM. They're extremely well positioned to take advantage of all of this flow data all this data and the bad actors are Not that there's not that many of them. You know, it's not like a small amount but like There are like known targets groups of people that work together. We learned that on the cube as well. Is that true? It is true, but let's not forget about the 16 year old the sitting in their basement that's trying to hack in Now, why is that important from a breach perspective? It may not be that important But the problem is once that 16 year old is in the door and they're actually running amok inside of your system You don't know that it's a 16 year old. That's just Messing about in his garage or his basement At that point then companies start to take damage control They they see that some some say some breaches happen some credit card information has been exfiltrated And now they go into damage control and they start to notify All of their customers. Hey, I've had a breach when really in fact nothing's happening when the 16 year old So the the challenge is who is your attacker? Is it a 16 year old or is it actually organized crime? Is it some anti money laundering group? Is it someone trying to fund a terrorist organization? That's the challenge and that's why you're seeing the focus move towards attribution. Who's in there? That's going to help me decide. What are my next steps in terms of the damage control? And it's all going to also help me on remediation. Mitch, can you talk about The investment the funding the spending it used to all go toward keeping you know people out of the castle Given that it's eight months on average that people, you know, don't realize they've gotten a breach How is that investment? How is that spending changing from a customer perspective? And how is it changing from IBM's resource allocation from, you know, protecting the queen and her castle with a moat to trying to detect So I think if you look at that spending now the the decision makers in and as you you've probably heard on the queue before the decision makers It's not only the it department these days. Obviously, they have a great influence on what's taking place But it's actually moving up to the boardroom. So the boardrooms are starting to look at this and say, okay 11 million dollars on average I need to start dedicating some funding to see how we can start to enforce our current Security systems meaning who's attacking us. So we're starting to see that funding shifting. Obviously It's like anything else. You have to have the mode in place after that though How much are we going to start to dedicate towards the attribution and who's behind the attacks from the IBM perspective? You can see we've got a lot of investment in IBM security systems But if you look at safer planet and IBM analytics group Lots of investment that's going into actually helping Take this tradecraft and now security policing into the cyber threat intelligence space They're actually tracked down who's doing the attacks. So I realize i'm simplifying it But if you had a hundred dollars to spend as an organization, you know, what's the profile look like in terms of Just protecting the perimeter versus trying to use things like analytics or other techniques or maybe even internal training To try to Remediate, you know, some of those problems. Is it 50 50? Is it no, I think you're going to see it move towards 50 50 But it's a long way from that, but it's moved the the the scale is sliding very quickly now So I'd say at the moment you're probably talking 75 75 on traditional security and 25 maybe on on the attribution part I think you're going to see that shift and it really needs to decide I think you're going to see that shift towards let's do some cyber threat intelligence because that is really providing me The ability to be proactive. So I think you're going to see that shift. Look the the the the traditional Cyber security measures, they always have to invest. I don't think you're going to see that shift more than 50 So you're probably going to see a little more movement on that. So that's the ideal balance Let's say and I know we're really simplifying things here But what's my question is what's the what's that headwind for organizations in making that shift? They obviously have the baseline to keep in place the the the perimeter pieces the traditional pieces What's slowing them down? I'd say it's it's more cultural than it is Technical like many of these things when you start to see a shift people are You know they kind of hang on to the traditional methods And as they start to see more breaches and they start to see more methodologies come out to help them be proactive Then they start to adopt it. So if you look at the forward leaning Let's say boardrooms and also the the security operation centers You'll start to see them shift in fact We we're hearing this new term quite a bit the next generation security operation center and in those discussions You're starting to see this discussion about threat cyber threat intelligence. I mean if you look at IBM's x-force That's exactly what they provide to our customers. They provide that intelligence On who's out there? What are they doing and why are they doing it to help them with the remediations? So next generation security operation centers, you're going to see that activity So Dave's Dave's question is a good one. I want to just double down on that for second Dave The customer's sitting there. Okay. They got the investment pie. They're going to be shifting. What do they do? I mean, how do you get since you're like a getting started kid? I'll see call IBM you guys will help them along but How do I get started? How do I train people? I want to hire to hire young guns to be like my navy seals of like Of security. I got like the air force. I got the navy seals the marines I mean, is it a discipline thing is that how does the company build the culture hire people and then like engage you guys That's a very good question So in the last week, I've probably had eight conversations on that and and it's really companies are asking exactly those questions I want the next generation security operation center But it's it's certainly it's about the technology and solutions But it's more about how do I set up these security operations centers? What are the best practices? Where do I need to invest in terms of that training? So so you mentioned the seals you mentioned all of these Kind of these other disciplines in the military.  They grew up on this stuff They're very good at it But let's not forget the old crows as we would call them in the military The the gentlemen there are ladies that have been around that have been doing this for years So now you're seeing a blending of let's say older generations So the young guns and the old crows and that's really what we see is Joe crows are really awesome Mentors because they've seen some of the tricks back on the old days not at the scale Correct, but it's architecturally is an operating environment Yes, so as I mean you see that it's like it's like well, let me just give you one example Here's a kung fu example of Jeff Frick and I was a great son Let me give you one example of one customer So we have a customer that has quite a bit of analysts And they have a lot a lot of younger generation people in there in the ages, you know from You know probably 23 up to 30 years old But they also have a lot of senior analysts So one of their requirements was I need to be able to take my senior analysts who develop a lot of very Complex analytics that uncovers insight very quickly. I need to capture that knowledge and put it back into solution So that is one of the areas that we've done in the safer planning organization with our enterprise insight analysis is We give that customer the opportunity to develop their own analytics for their specific Use case and then they get to use it across the enterprise So there's a there's a case where the old crows are able to actually take their expertise And give it put it in the hands of the younger the younger analysts And it really works good on the cube many times that David I always love to interview him and one of his comments is, you know, no one writes bomb on a manifest So it's easy to use metadata to look at stuff But you got to know with the observation space is that's his word that he uses in the IBM So big data analytics certainly is a huge driver in this this area, right? So, you know, no one writes. I'm hacking you now or this super fish embedded in your machines What are you guys doing from a tech standpoint? What do you I what does IBM bring to the table because to do that observation space to expand out the attribution And to build that next generation security operations center, you have the tooling You absolutely have to have the tooling so I'm glad you mentioned Jeff Jonas Because Jeff Jonas has been one of our executive sponsors on this particular program And he's brought a lot of that expertise in fact some of his technology is embedded into this solution for exactly That and you've probably heard Jeff talk about low signals So we want to pick up the low signals in this massive amount of data But if you if you apply this to the cyber threat intelligence space So typically the the cyber solutions are focused on the it data We want to bring in additional data from outside. So we want to bring in your hr records We want to bring in your physical security. So when I swipe a badge and I go on a door So now you've got location data any type of telephone data that is not collected in the typical system So we want to merge all of this data together that presents a problem How do I get all of that data in and I want to do that fast enough in real time? Absolutely one of the requirements from our customers was I want to continuously ingest and while I'm ingesting I don't want to do a batch process I want to be able to do analysis on the data as it's coming in Enter Jeff Jonas his technology is absolutely superb at doing that new data comes in and it automatically does the identity resolution Immediately on the fly 24-7. You don't have to wait for some sort of batch process So the key out of that is I need to run analytics across the entire data set a lot of the Other vendors they will do certain parts at a time or they'll do it in disparate data You're not going to see these signals or the low signals across Individual pieces you put them together now you start to see insight So that's what we're doing to tackle this big data problem. This this the market is just it's infinite Every year, you know art cove yellow writes his Warren Buffett letter and every year I email art is the art I I'm looking back. I spent more. I worked harder. I'm less secure and I when I talk to customers I say listen the the calculus is pretty straightforward It's the probability, you know of a breach and the expected loss of that breach both are going up So I feel like there's there's no end in sight To the to the threat which makes it a great business oftentimes You don't like to talk about the business opportunity, but there's a huge business opportunity for security spending keeps increasing It's a white tape problem never goes away It's a white tape problem that never goes away.  It's the it's the that's pretty significant That's not get off. What's the what's the heaviest thing that you've seen that I think the heaviest thing that you see Is things that may or may not make it to the press in terms of how the breach occurred Stuff we don't see so if you if you look at one that was recently in the news where You think that the attack came full frontal right in through the front door Or right in through a very well published backdoor. In fact, it happened from Let's say an ancillary type of website that was remotely connected with the organization That was there for a charitable organization type of way for the company to give back to the community Well, the infield traders got in and they studied for six months. They studied the security architecture of that Kind of smaller website that really was not connected to these out in the jungle They just took it down and well So what they did is they studied the security architecture And then they discovered that the same person. So these are smart characters They actually did their intelligence on their target They determined that the person that set up the security on that very small system Set up the security on the large major system. They were first engineered the security for the main system based upon the prototype that they saw The the quote I got to get this done over the weekend for the charitable organization So he took his day. They basically went red as mine Exactly the red is mine.  So you think something is quite benign, but really it's anything but benign And the motivation there was was dollars. It was money. Absolutely In this particular case is a filtration of customer data dollars and it was it was in the double digit billion Double digit billions, correct Point about it's an economics arms races right on and the bad guys have a lot of resources And uh, and it's on and then the other vector that I wanted so I feel like Stuxnet Just sort of created a whole new era of security and and ideas on What's possible the future of warfare? Is that sort of is that a milestone in the security business? Is it sort of I know it's old news now, but I wonder what else is out there that's Stuxnet like that? We don't know about it's got to be you know in this arms race sort of a you know, what era are we in here? Well, if you think about it, um, they only have to be lucky once Yeah, and they can do you know millions and millions of attacks and they only have to be lucky once They have plenty of time They're able to try out new techniques and they're always 24 seven Working on those new techniques. So the question is you know to to go after your question How do we stay ahead of that because it's constantly changing to rethink get a rethink a new way to think through security To use their phrase where IBM and that that is exactly it. It's a one-shot deal There could be a zillion attempts and just one penetrates But but but the question is if it costs double digit billions It's not a money issue because you know the sales. Hey, what are some of the consequences? If you don't do this, you know, there's no no there's like billions And so the money on the table is there. So if that's the case, how does IBM write the software there and What do you do the customers or they say, okay, just hand over money Is it cryptography? Is it system z? I mean system z has some serious cryptography. Is that the answer? So like Well, I mean look we can throw a smorgasbord of technology at this So our approach is we want to be very systematic. So when people come to us, they want to know about next generation Ration so we have a consulting practices actually does this We also have the IBM security systems has a whole host of tools that actually fits in with that consultancy On the safer planet side of the house where we use our i2 counter fraud and threat solutions We're looking at being able to establish a platform It's very flexible and very agile and that comes directly from our national security experience because the mission is changing And think about that carried over to the commercial space. The mission is changing I need to have a technical solution It gives me the agility to change as a threat changes And it gives me the flexibility to be able to add in those models as we need So if you look at what we're doing, we tackle the big data the identity resolution from Jeff Jonas We tackled all of those first for initial customer now. We went to the next step How do we use Watson discovery advisor? How do we use? Watson explore to do unstructured data as you well know the unstructured data 78 of the data that's coming in so the key to that is agility and flexibility and be able to do Analytics at speed and scale across that entire data set. That's what we put in place It gives them the most flexibility and you talked about sort of the national defense trickling into the commercial world But to me that that stakes of the national defense. I mean, it's they're huge and we're talking about again the future of warfare here So are those two related in other words? Are we sort of learning from what we're doing in the governments? Does that actually trickle down into business? Does it trickle down fast enough? So I think what you're seeing is the the nexus Let's say national security or even geo Geopolitics with the commercial world. So as you know, there are state actors that are attacking some of The commercial organizations around the world. So it's no longer the 16 year old or let's say an anti money laundering organization Of course, they're they're a threat as well. But now the state actors start to come into place So the nexus of those entities and it's it's an asymmetrical threat If you think about a commercial organization compared to a state actor There's a lot at stake there and it's a very difficult situation Now what comes to the table is not only IBM solutions, but you're seeing the commercial organizations start to cooperate With the government defense a partnership So now you're going to start to see a lot of sharing of cyber threat intelligence data And that's why we think that going to being able to determine Who's the threat and why are they there? That's going to become more of a factor in in defenses for commercial organizations And how about the way IBM works with competitors?  Case the good guys. Yeah, cement takes the good guys How much collaboration is going on at the within the competitive? So I think you see from the professional organizations IBM does a lot of work in these professional organizations the the x-force Reports that go out are consumed by people around the world I mean some of our competitors and and they actually collaborate on that So on the professional organization side IBM Participates in quite a bit of those on the national defense side as well on as on the commercial side So I think at that level you're seeing quite a bit of cooperation But I mean like again, let's face it. This is business and And we want to promote our business. So talk about developer community. Obviously, this is a big developer show kind of shows Let's build as a developer show What's your take on Developers are there great resources out now? Is Watson a good thing to play with and and our security developers nuanced on certain things And did I like certain tools? What's your view of how a developer Building out the next generation security operations center will look like What tooling so so that's a good question And I don't think I don't think we're seeing a comprehensive approach across your your entire question But what we are seeing is quite a bit of interest on the developer side and the shall we say the open source So if you're familiar with github how you do open source development, so The the safer planning organization actually has a github site where we We place things out in open source like connectors because the key to all of this is getting the data in So we have Developers on the open source site around the world that are actually developing Plugins to our tool and they're also developing connectors and they're all made available on github So we're we are a strong supporter IBM in general is a strong supporter on open sources, you know But also safer planning organization Is directly contributing to the open source and it's mainly around the I2 intelligence analysis that can be applied across the spectrum Obviously that can be applied to cyber threat intelligence as well. If I was a young kid Can I was a computer science major? I would love to go to the security. I think it's one of the most intoxicating technical Fun, I mean if you're a gamer you got to love security. Absolutely. I mean you must get a lot of gamers who come insane I mean because this like first person shooter is security You have to go at look at the landscape look at the targets understand some of the attributable things You seeing that I mean that's kind of the profile If you look at kind of our profile of the people that are that are on our team, you play call of duty or you could work If you look at the profile, we have quite a bit of the younger generation But if you look at the the people that own our team, we have former military analysts We have former security operations center cyber threat analysts. We have police officers former police officers And and I think they think that they're in the most exciting part of IBM because of exactly what you said The other point I might add to that is when we get up and come to work We know that we're trying to make safer planet.  It's interesting I mentioned on the intro and I'll just end the segment with this kid to comment on it It's like they have two ends of the spectrums It's good guys and bad guys and the startup that we know at the california hope meant to go started by a bunch of Big data math guys In israel and they did all the intelligence to find the bad guys. So I asked them Why did you start this social sales company? He goes, well, we sit at a cafe one time We said we're so good at finding the bad guys. Why don't we find the good guys? And so essentially, you know, if you look at IBM watson, you know, they'll talk to you Oh, you know social business, you know It's reversely the other side find the good guys find the target customers.  One of them is from executive From executive security and another one is if you're trying to lobby, let's say something in congress or whatever Who are the people that's on your side and how can I leverage them? So it's exactly the same trade crowd the good guys have to serve good the good guys and Get the bad guys. Exactly. Awesome. Well, good guys and bad guys are out there big data cloud scale new ways new architectural security centers Super fun area. You must love your job. I do. Absolutely. Thank you very much. We are here live at IBM with the right back It's a short break. Just talking security having some fun. We'll be right back day three of the cube. We'll be right back Hey, this is Brian Seraven director of digital media for the san francisco giants and you're watching the cube Hi, i'm dan gordon co-founder of gordon birch and you are watching the cube Dr. Randy fagan the chief administrative officer at texas institute for robotic surgery at hca and you're watching Beat the number one seed You just have to win 70 percent of your points at net and keep unforced errors under 10 percent On the ibm cloud the us open analyzes 41 million data points from eight years of competition to uncover key insights Data can help show you how to win no matter what business you're in Today there's a new way to work and it's made with ibm It was my first time on the cube. It was fun. So it's good again. Yeah, I think uh, what I've come to find I think my second time on the cube is I mean, it's just such a real time high energy experience It's very good because uh, there's no filtering of questions. I was not prepped other than saying go and get up there So it was quite good. It was quite an experience. I think what you're gonna get is the real answer You know, it's not scripted. It's authentic.  So I thought it was great I mean, I didn't know what the questions were ahead of time They asked some good ones. I think some ones that if it was an unbiased thing I mean a biased thing. I don't think we would have got and I think that's what people want They want those questions and it's hard for us sometimes to ask them unbiased because you're biased by nature So it's it's great to get those questions and you'll be able to answer them Like I said, you know, I love the energy. I mean these guys ask good questions and uh, obviously not only them It's the uh, twitter feeds coming in from questions from the audience So sometimes it's a question nobody wants to ask but they're thinking so it's good That's a great way to core sort of you know, answer those tough questions It gave me an opportunity to hopefully share with the people watching Um, you know some of why we're doing what we're doing cute little guy, huh? This guy could take down your entire company Stay with me on Thursday a hamster video goes online on friday. It goes viral a network choking phenomenon Why do you care? He's on the same cloud as your business The more hits he gets the slower your business may get Do you want to share your clouds with the hamster? Today there's a new way to work and it's made with ibm Hey, i'm george mathew president ceo of altrix and you're watching the cube and dmitri zamin I'm the cto and co-founder of stackstorm and you're watching the cube Vice president of product strategy at qlogic and you're watching the queue Hi, my name is ben jones senior product manager of tablo public tablo software You're watching with you All right, this is frost wall from tablo and you're watching the cube This is a burrito made with chocolate soybeans and apricots What kind of chef comes up with this? A chef working with ibm. Watson on the cloud Ingredients are just data Watson turns big data into new ideas And not just for food Watson is working with doctors and bankers to help transform their industries Today there's a new way to work and it's made with ibm Is a live mobile studio when you bring it to events and we say we extract the signal from the noise What we do is we get the absolute best guests that are at those events We bring them inside the cube and we talk to them we have a conversation I think the difference with the cube Is that the interviewers are active Participants in big data So it's less about trying to explain what big data is And more about relating what's going on. So we're a big data driven organization We have a data science team that allows us to see not only what's trending broadly With the public but what's trending in very specific areas in our specialty in tech That allows us to vector our analysis and relevance from our research and journalist team Into everything that we do as a media company. We really want to make it fun exciting But more importantly extract the data from the guests and extract that metadata and share it with the world So people can use that information to better themselves better their companies more importantly connect with other people To do more business to define more about the technology and for us. This is the future I do a lot of these types of interviews. I spend a lot of time with the press and the cube is a lot of fun It's you know espn for tech I think tech's evolved to the point where you know people want to understand the personalities behind the technology Which probably wasn't that interesting 20 years ago I think they they made a lot more a lot more entertaining a lot more interesting as well as you know Putting some technical need on the bones as well the value of an independent news organization at an event Is that it allows our audience to have a perspective that's balanced that it's not just you know, the vendors talking to them It's the community. It's analysts. It's technologists. It's customers practitioners So they get a full perspective that's unfiltered the benefit of the cube is place for conversation for people to connect with each other and and to learn about things and It's a revolution in media We look at the technology and the people behind it as tech athletes Those are the folks making the companies making the technology really creating the new value in this modern era And it's fun exciting and more importantly. It's very social these days With social media people looking to not just read articles, which are great and obviously silicon angle does a lot of that as well But being able to see high definition video Very intimate interviews with entrepreneurs and operators innovators in the industry. I think it's really important So the job you do and getting this out in a very timely way I think is really important. We always know that your view is right until you hear a different perspective So you're always interested and give me some neutral perspective I'll be seeing it from a different light, right? And maybe ask a hard question or two that I might not have considered it. You know, in that sense, right that independent Voice that's always ability to right have You know, sort of independent audited sort of perspective right of the world It's always just good The cube has been called the ESPN of tech and really our vision is to cover Every event that's out there We really truly want to be a global organization that is at every event extracting the signal from the noise Being on the ground giving our audience a sense of what's happening at that event But also providing analysis and insight worldwide literally for every event that's out there You know, I love it. I was actually telling uh, John and Dave every time I come back to the cube You guys have new toys new cameras. Everything's getting bigger. So, uh, you know having been on it for Several years almost from the very beginning. It's uh, it's always great to be back and You know, you guys doing an amazing job. So, uh, it's wonderful It's about connecting with people And that really is what it's all about having the conversations in a very social collaborative way And that's what makes it so exciting how people are watching Live from Las Vegas, Nevada It's the cube at IBM Interconnect 2015 brought to you by headline sponsor IBM Okay, welcome back everyone. We are here live in Las Vegas for special presentation of the cube IBM Interconnect This is our cube special program We go out and I start to see the noise our next guest is Steve Robinson gm of cloud platform services with IBM He's a blue mix guy. We interviewed him last year when he came off the stage announcing blue mix Welcome back. Great to see you. Thanks guys. It's always good to see you and always good to have you at our show as well So, you know, are you in a pinch me moment like in my dreaming because when we interview you came right off stage It's like, okay, we're doing blue mix. We're all behind it Go, you know, that was our beta then, you know at that point. We barely knew what we had We had our cloud found reversion. We collected a handful of services and then we're like, let's go So you guys have been successful. So just a quick update. I was a great journey A lot of speed a lot of rapid acceleration on your end. Yeah, so we launched it in beta We got commercial terms around it at the end of june We announced this week 100 services on top of the platform So we've taken every piece of middleware within IBM. We've converted into a set of services We've got some great unique ones like Watson In november we announced dedicated blue mix. So uh, software has got a great thing where you can do Single tenant private resource so we can now drop blue mix on top of that And then we gave a sneak preview on stage on monday local blue mix. So now local dedicated public We now have a complete hybrid mechanism to really get the enterprise account charged up So I want you to answer the question. It's not for me. I'm just paraphrasing what the sentiment is IBM blue mix That's cloud foundry. They're really not committed to the cloud with blue mix pass I mean, you guys have been successful. You're the proof points internally. What's it been like? It's been pretty much game on internally and what's what you uh, what have you guys nailed down this year? Share with your audience to answer that question. Well, I think the key thing you find is, you know You know from the chairman down we're 100 committed on the cloud right now from the the acquisition of software To the rollout of the data center 40 data centers. We're going to put this thing on And just from where we were in february to to where we are today, you know We had an estimation that we probably have 20,000 apps up and running on blue mix by the end of the year 200,000 is what we've been into We expanded that out to london. We've got it coming into ap The amount of enterprises that have been excited around the dedicated piece has been unbelievable the support from IBM and also the support from the community The momentum behind the cloud foundry piece that we've seen acceleration unlike anything we've ever seen We have we have one of your customers in here The nigel nigel who said without blue mix he wouldn't have finished the races really impacted his business I mean, this is like 150 miles an hour in the ocean Okay, he's trying to get to 210 Blue mix is working. It's you shipping code. You're shipping solutions. I think what it's done is embedded in it And I think what you're seeing is that you know, it's bringing this You know, I think other paths that had kind of opened up the opportunity to really do innovation and really do it at speed And most enterprises had held back a little bit from that as well But now with the IBM name behind it plus the type of services that we're putting on top of blue mix They see their favorite type of middleware starting to come They see capability and enterprise grade software that they know and love and now they're putting their toe in the water as well Guys like silverhook, you know when you're racing two and a miles an hour offshore Sensors all over the place, you know virtual reality around the thing they get all the pieces together Yeah, this is not it's not an r&d project. Blue mix is out delivering value It's not about the integration. I mean to me that's a key part of it Right because people don't wake up and say, oh, I'm gonna get me some pass Yeah Well, it was funny. We had Jim Dieter's on stage with us this morning and Jim does the the pure startups and You know for a lot of the smaller companies that are doing paths for the first time, you know, it's naturally where you go I'm going to run on the cloud I'm going to have an environment that brings services to me as well Our enterprise accounts though, you know, they've got a large set of kind of crown jewels back behind the firewall as well And they're waiting for somebody to say how can I use those in the equation? Some of the cloud vendors say well just port it some of these environments they've been running for years and decades They're not going to undertake a port but how do you bring that to the case? So one of the things we announced this week as well was a secure gateway So let me kind of use my my mainframe environment. Let me use my on-premise environment Let me bridge that back out to the cloud Brand new api management set of services as well That lets me better wrapper those and be able to integrate it And then also kind of a federated catalog so I can actually use some services local where it makes sense And I've got latency concerns security concerns But then I can use all these great public apis with it at the same time So we're getting a lot of novelty on how we're bringing the cloud down to where they are today Plus giving them the option to reach out as well So what's going on in the app? You've mentioned a number of applications like hundreds of thousands So talk give us some a sample. Oh, we're we're how would you categorize them? How should we be thinking? I think With the passes, I think most firms are finding that it's almost a programmer's renaissance right now So For one that's such a easy environment to get up and going is almost like that unlimited data resources You got unlimited compute resources and now you can play with Middleware that you would have never had exposure to as well. So we see tremendous amount of exploration going on so we got one partner working with us and They started working on how do we Bring technology into a retail store experience to kind of augment what the customer deals with So traditionally we're bringing plasmas in and they could actually tell if your male or female And they were using it initially for like a bike store to see Help me pick out what kind of bike reviews We launched the watson services and one of the things we have in watson is we can analyze your past 100 twitter feeds And come up with the five personality traits that you have And so they played around with that and they got some some cute feedback from it And they said that nice parlor trick But then a large car company saw that and said hey, maybe we could use that in the dealership The individual walks in gives you their twitter handle Maybe I could use that to help assign the salesperson to them to increase the sales in the dealership as well No one had that on the radar screen But because the ease of use of playing with these services things are just popping up Is that now a new product is that was that productized is that just more of an anecdotal Well, the the company of sales IQ that's a reference of ours, you know, they've already have stood up the the watson services and They launched it at south by southwest last year and now they're playing around with other But we're talking to docker really with this word stand up is a is a cloud term right stand up some servers In a sandwich means not provision it take weeks to provision. That's a cloud term But that's now now proliferating to social media to business standing up fast as a cloud dna Well, you know, I spent five I spent five years irrational and you know, we were dealing with more traditional style of development And you know, it was unfortunate But you know used to be look at old software projects 68% of them never saw the light of day It wasn't because we had bad programmers But to do a project you had to allocate the hardware you had to allocate the middleware Sometimes it took six months to lay out web sphere and mq and whatever you put on top of it as well Then you build the app then you have to test it Then you got to fight with the cio to get on the production schedule and oh, they're upgrading sap that that year You're all that you're off the table When we might replace our sysco routers, that's about a 12 week just assessment took all the budget So we're at a point now we're seeing guys You know Programmers just it's like a candy store. They're now saying I can I can launch a basic application And I may do a version for east coast. I may do another version for west coast I may do one for a subset region They can now explore and try things that were just completely unthinkable You know the creativity is on the table pretty much it is what you're saying Well, we've actually have stood up. We've got two of these blue mix garages up and going I've got one in san francisco and we opened up the second one in london as well And we kind of have it as an innovation center. So customers can come in and we we actually look Hi, i'm andrew tracer a business operations manager at linkedin and you're watching the queue I'm criss-cellan vp of business development for hp big data and you're watching the queue Hi, i'm stacey slatter senior vice president of communications for the giants I'm in the garden at at&t park and you're watching the queue I'm thomas minnick business intelligence consultant within our works and you're watching the queue Hi, my name is david tishkirk director of partner marketing at claudera and you're watching the queue Hi, i'm jim you founder and co of bright edge and you're watching the queue Act one scene three Live from los vegas, nevada, it's the cube at ibm interconnect 2015 Brought to you by headline sponsor ibm Welcome back to ibm interconnect everybody. This is the cube. We're here at the mandalay bay There's another whole group over at the mgm a lot of the general sessions and keynotes are going on Check out interconnect go.com. It's the digital experience for ibm interconnect Really pleased to have nancy hensley here. She's the director of marketing and market marketing for analytics platforms at ibm and jill Horwich who's the director of the portfolio for analytics at ibm Folks welcome to the cube. Great to see you. Thank you. Good to be here lots going on where we're really excited We've been we've been covering ibm's analytics business now for several years Um, I often said that what ibm did is it brilliantly Consolidated its analytics business and it and it super glued it to the big data meme and really became a leader In that space and it took some time, but it's really you know worked out great. So absolutely congratulations. How do you feel? What's what's new great? I think you know Repositioning things helps us really meet more of what the customer's agendas are as opposed to nobody really goes around saying I want a data warehouse or I want a bi tool or I want a database anymore They they have agendas like cell service analytics and cell provisioning of data and modernization of their architecture So this really positions us to help our clients meet these new needs because there's been so many disruptions to the data center It's crazy. The last everything's changed in the last five years was changed Oh, wow Well, I mean I used to call the data center that's sanctity kingdom Where all the data was safe and it was governed and there was all this types of control But now the biggest pressure I think is self service capability right and the cloud has really helped enable that But even just self provisioning of data the ability to have access to analytics In a very short period of time to do what if analysis so things like dash db on the cloud Helps enable that with lots of analytics, but that sort of service levels and disruption to the Sanctity of the data center is really new within the last few years, right? So joel your responsibility is the portfolio you got portfolio in your titles. Yeah, um the big portfolio Right, you know joe tucci. It always says it's better to have No gaps, you know better have overlapped in gaps and that's sort of the case for your portfolio Yeah, no, I mean as Nancy pointed out, I mean we are seeing a lot of changes happening in and around, you know analytics I think before You know data was kind of this separate entity than the actual tools and the applications to get value out of data So it's I think really as Nancy pointed out really valuable to our clients to kind of start bringing that together Into one solution. I think the other thing. I don't know if you're at strata I don't think you made strata last week because of the storm. We were there. I didn't make it right But um, you know, I think there's still a lot of interesting, you know changes happening with roles So the data scientists is still very much at play So as Nancy pointed out with the cloud You know part of that Value that we bring is being able to access data kind of anywhere So, you know if it makes more sense to spin up a hadoub cluster for example on blue mix And then attach it to other, you know services that we provide You can do that or if it makes more sense to add it to your logical data warehouse Then you can bring hadoub into that environment and start working with it there So, you know, we're seeing still the emergence of the data scientists the chief data officer And bringing all of this together is really making it valuable for them. How much time we got because We could be here for a while. That's good. I want to I want to explore some of those things So it struck me Nancy when you're talking about self-service And Joe's talking about the role of the data scientists and I picked up some of the themes just listening to the cube last week and watching the the tweet streamed The sort of self-serve of the business Yeah, the citizen data scientists that somebody's I'm sure you use that term but uh, but Really, that's the next wave. Isn't it of analytics is is empowering that business user to actually use the tools It never happened in the old sort of Well, it did in the in the shadow it we used to call them the shadow it organizations And they're really the ones that have kind of pushed us on the requirement side Um, remember where we used to have just data marts. That was all the shadow team That was just they were trying to solve some specific problems And they really needed it to stay out of their way And that's why they would basically build their own systems and now we're seeing that wave again But there's even less patience right because we've now become much more critically dependent on analytics more so than ever So the ability to provide self-service and you can't and it's not just about the data warehouse Because you also have to figure out how you self provision data. How do you give that capability and that's really new to clients Right because this used to be something that we very much controlled and you just can't do that anymore So that I'm going to pick up on the sort of data mark because it created a data quality problem You have issues now in in people spinning up big data projects with no notion of governance and no notion of the edicts of the Organization You mentioned the chief data officer. Is that his or her job? What do you see happening there? Yeah, I mean so data is becoming more and more prevalent obviously not just in the enterprise But also externally right we were looking we did a crowd chat last week with you guys And you know we were going back and looking at that twitter data We have a really nice relationship with twitter now So, you know as we look at how to extract insight It's not just the transactional data we have living, you know on premise It's also the data all around us whether it's coming from a mobile device social In other places. I think you know the other side of that is really about this Kind of convergence of multiple technologies. We're seeing are multiple trends So part of it is like we brought up the cloud the other part of it is you know this Insurgent of more and more data and then the third thing is I really think is machine learning So, you know as we talk about you know, how do we Structure data and how do we make use out of it? I think one of the emerging Technologies is really around machine learning to automate some of that process Right. So I want to talk a little bit about Maybe go back to strata a little bit. You were there Joel, right? So you guys announced odp right as part of a big opens consortium There's a lot of discussion now going on. Yeah in the industry about it So on the Obviously, there's a lot of competition going on right so odp gets announced and co-operation Yes, we live an interesting time. So the guys who didn't join odp Mike also in particular wrote a blog post a analysis fake open source Compared it to osf and I I've had some back channels with mike on that. I don't really buy the osf analogy But his point is which i'm listening to and I wonder if you can respond to it is why do you need an open data platform? It's all map reduce anyway. It's all standard out. So what's how do you respond to that? Yeah, I mean these are two very different things right one open source and the apache software foundation is really a way for developers and You know innovators to come together and develop on the platform in fact plaudera in their keynote address They showed you know this graph Of the opens are the open source and hadoop projects themselves like Growing kind of linearly over the last few years and so that you know, we obviously support that But for our clients right in the industry for them to Really adopt to do as kind of a you know a foundation for analytics and advanced analytics You really do need standards kind of around that to make our clients lives easier As a as an example, you know, I was pumping my gas at the gas station the other day And I was looking down and it struck me like you have 87 89 91 right octane levels And you know if you were to go to every gas station and they had different numbers there They're trying to describe it differently. You'd be very confusing for you And so you know the odp in my mind is really a separate conversation about you know, then open source development It's really about standards for an industry If you look at the open data platform consortium, it doesn't just consist of hadoop and technology vendors It also includes other industry People so customers. Yeah Okay, so we should think of this as now am I right that you're no longer Going to ship a separate ibm distro the same thing with pivotal. Is that right? Or that yeah, so you still have our own distribution. It still has a lot of you know, um You know value packed into it. It's now free. It's kind of decoupled from the big insights package So we kind of split that up into four different modules So we have the big insights kind of data scientists where we introduced Our support as well as machine learning, which is really interesting We also, you know have a smaller module called analysts that kind of focuses on big sequel and big sheets Kind of for more of the business analysts and then we've also added You know a Enterprise kind of manager That allows you to kind of get more out of the cluster. So we've decoupled things. We're not giving up on our distribution We're just the core of the odp is really, you know, the file system mapper news and just these really core bits But how people still build around that will still so that core will we'll find its way into your distro Yeah, right exactly and then it becomes the standard and it's the same standard that horton works is going to use That pivotal is going to use et cetera and then these the other people Yeah, we hope others join in. Yeah, and that just makes it much more adaptable in most people's data centers Right because now we have more common standards across I want to talk about so you guys have IBM's always made the point that hudduke is not big data What is big data now, right? We've defined it probably but having said that hudduke kind of got it all started You know, it's sort of the main spring of innovation map reduce and you know, which is like changing so much now, right? I mean real time and it's really exciting Iot is sort of the next big wave But what's happening in the traditional enterprise data warehouse? We did a survey Jeff kelly did a survey last year and we were astounded at the number of customers who said they've Begun to move workloads transition workloads from traditional edw to new forms of big data However, you wanted to find that hudduke or not, but just new and different And it was a huge number like 65 another 30 we will by the end of last year And that was really just in the last year, right? Yes. Yeah, right it flipped overnight And so people just they glommed on to it said wow, this is a cheaper way to do things We're still keeping our really valuable stuff in the edw, but we can offload so much and maybe I think of tearing What's going on there? What are you seeing in the customer? So offload is one way that customers will embrace hudduke, but I mean hudduke is also about the different types of analytics and I think Initially there was when hudduke came on the scene that maybe the data warehouse people got a little defensive like it's not going away It's not being replaced and it and it obviously isn't right, but It I think what's happened in the last year is it's become An acceptable compliment to most enterprises and so even a year ago where we had a lot of our core data warehouse customers It said yeah working into that hudduke thing a year later now It's on everybody's agenda and it and it it can serve multiple purposes right allows you to do analytics that you couldn't do before And now with sequel, you know the fact that you can access that data via sequel And what we're trying to do with making data very fluid with some of the capabilities So even if you have the query originating on pure data for analytics you can access data that's in hudduke Which makes everything much more fluid within the enterprise So it's just more consumable to clients and that allows them to not only do more analytics like machine learning That they couldn't do before but also They can move some of the workloads off that might even be cold data Or even as a landing zone And that was some of the original use cases that we talked about when it came onto the scene I think actually what's starting to shift more is now that customers have used those use cases from a cost perspective They're starting to understand the benefits from an analytics perspective. Oh, I think that's so right on because you know abhi meta says that the first wave Of of value in big data was the roi was reduction on investment and I think that's true Many people realize wow Storage so much cheaper, right? Why stick it in a big expensive container when I can put it into this open source platform and I'll get great And then they realize it's not just about the storage Yes, there's this whole other analytic world that's open up to us So as an analyst when I saw that huge number of people shifting I said wow, uh-oh, but luckily Jeff asked another question the survey What are the most important tool sets that you require and your big data? And the number number one and number two were the traditional edw and data integration tools. Yeah. Oh, right Wow, right. Well, we're still we're doing we're still doing the reporting and analysis on our business That's not going away, right? There's still the standard reports But now there's much more discovery you can do Now that you have you can have the ability of having unstructured data, right? That the data warehouse just couldn't handle Yeah, you brought up the point that um, you know when hadoub first hit the scene You know it was kind of this effect of bor's law where you know the cost of disk, right in terms of storing data It got so low. I think actually the next kind of Phase is going to be kind of around a patchy spark So it's almost like you know when you know commoditizing kind of the disk to now we're talking about memory So, you know, I think spark is actually going to take us to the next level, which will also help Kind of speed up that data kind of movement, you know and what we can do Iterating over data to get value as well. Yeah, because I mean you think about adoub It really is a batch platform We get criticized for saying that you know all the time because right people don't want to market it It's bad, but most of the use cases today are bad and so everybody's trying to get to real time That's like a whole new So I wanted to ask you your perspectives on this So we we always look at you know all the startups and then you see hortonworks goes public and you see wow pretty tiny Cloud air just announced that you know past a hundred million dollar mark These are small numbers in the grand scheme of you know companies like ibm So you're a leader we've quantified the market ibm is number one and a lot of that is services We understand that but you're talking big Business large deals going down in big data. So we look at it say everybody loves to talk about disruption We see the rich getting richer It's like Everybody looks back at oh look at look at what happened to dg and apollo and all these goes, but that's not happening today What's different? It's like ibm companies like ibm realize the opportunity and you mobilize How did that all happen internally? I mean who knows data better than ibm right? It's we've built this company for the last hundred years around data going back to this CMS right, I mean We it's just how we built the the world right and now we're just Mobilizing in different ways to help our clients transition into this world of big data and iot But it's still really about the data and I love there is this one quote out there It may be horton works that has said it that it the huddup wasn't a disruption to the data center It was the data that was a disruption to the data center, right? Yeah, because like I said, we had this sanctity and and you know, it was nice and neat and we had Data that fit nicely in rows and columns and and now it's just coming at us from every direction And not only do we have our systems of record that run our business But now we have and the systems of insight that allows look at our business But now the systems of engagement that are all around us that we have to deal with and new ways that we never had before and so As we restructured how we look at the world with cloud data and engagement That's how we saw it right and that's our whole strategy and and how we've organized our business units How we organize our focus and development is all around those three things So you guys own the systems of record business you always have so the z that's your stronghold The systems of engagement IBM is demonstrating its mojo and social I mean you really are a leader there the the new term that I've heard and I think you guys pointed to systems of insight So you've got these three really interesting workloads application areas value creation areas And you need a portfolio to be able to address those right the flip side of that Joel is the portfolio gets really complicated Yeah clients sort of struggle to try to understand it. How do you simplify that? What are you doing to sort of try to integrate that? Yeah, I think it all starts with you know What the client is trying to accomplish right so you know when you start at that point? And we've seen a number of examples where this has actually worked which is you know when you start with okay What's the business kind of you know situation? What's the problem you're trying to address and then you kind of define, you know, what are the Kind of data sets and and things available to you To try and you know understand what's going on and that's when you kind of bring all of IBM's kind of suite of you know analytics technology And and experience into one kind of package to get behind That and provide a real solution So I think you know a lot of folks Have made the mistake of starting kind of at the bottom and saying well Here's you know, you need to get all of your data into a lake or you need to you know Create a hub first and you need to do all of this heavy moving, you know heavy lifting Before you can ever even start to you know address the business and I think where IBM has succeeded You know in the last few years with big data has been starting at the other end and saying okay What are you looking to accomplish with your business? What's going to be transformational for your industry, right? So I think starting at that level and then working backwards We have multiple deployment strategies. We're one of the well. We are the leading hybrid solution out there, right? So it's not just cloud. It's not just on-premise. It's not just to do it's not just you know MPP databases. It's it's a full spectrum of Colleague love That's a complicated situation for a lot of customers And so right something that you guys don't talk about a lot Is the services piece of the business 45 of the revenue and big data is services You guys are the leading services company in the world How do you work with your services organizations to leverage that for customer outcomes? So in our new structure, they're actually integrated into our business units So now we're working hand in hand from a client agenda perspective and all the way up through the industry So, you know, you'll have client agendas like I need to Advance my analytics capabilities around if your insurance are claims, right? So that's where we can now bring in the industry expertise Even more so with the lens from an industry perspective now on the back end What we're focusing on is making these things very consumable And so a perfect example of that is the cloud and dash integration, right? So Clients who are building in client cloud it today and accumulating lots of really great data Now in two clicks can just create a dash dv Data warehouse and off you go right now You can bring in new services like Watson analytics on top of that spss And it's all within a few clicks very self-service very very consumable. So the domain expertise For that loud lives within the analytics group. Is that yeah, we're all one big happy family The industry expertise as well in the industry, right? We're shifting very hard towards the industry from a go to market But that's within the analytics within the analytics group. That's huge. I didn't realize that I just got the one minute sign. So I got to ask you Joe you asked about What you mentioned data lake. Yeah, john furrier has been asking everybody Data lake or data ocean What's the what's the better metaphor? Well, I I mean personally I I find that You know a funny metaphor. I think I used it in analysts analysts briefing yesterday Where I said, you know the idea of dumping all of your data into a lake and then going fishing Is really the wrong idea and so the ocean is even harder to catch things, right? So it's like a big game fishing. Yeah, I think about it the other way say well What type of fish do I want to catch? What's the best lure? Right, and if I want salmon, then I'll go to the ocean, right? But if I want trout, I better go to a river, right? So I think we need to kind of start questioning the idea of like hauling data into a lake because You know, I don't see it. I don't drinking water. You go to the lake. If you want currents, you go to the ocean You want to surf the waves, so A lot of diversity you need a big portfolio to take care of that Joe, thanks very much for coming on the queue. It's great to see you. Thanks for having us All right, keep it right there, buddy. We'll be back with our next guest This is the cube we're live from IBM interconnect in Vegas. We'll be right back A lot of things from a trip around the world But you can't always bring back customer data because many customers don't like it when their data moves around If you're going to do business globally, you need a cloud that can keep your data where it needs to be Today there's a new way to work and it's made with IBM Hey, I'm George Matthew president co of altrix and you're watching the cube and Dimitri is a mean I'm the cto and co-founder of stackstorm and you're watching the cube Vice president of product strategy at two logic. You're watching the cube Hi, my name is ben jones senior product manager of tableau public tableau software and you're watching the cube Hi, this is frostbough from tableau and you're watching the cube live from Las Vegas, Nevada It's the cube at ibm interconnect 2015 brought to you by headline sponsor ibm Okay, welcome back everyone. You're watching the cube live in las vegas for a special presentation for ibm interconnect This is our day two wrap up. I'm john furrier the founder of silicon angel my coast Dave Vellante co-friend of wikibon research and said have special guests for our wrap up No other than the ray wang. I think you're number two on the leaderboard right now last time time checked Here in the social media lounge. Welcome back to the cube. Great to see you. Hey, thanks. I didn't even know I was on the LL list You're just always Influential But you are you've been covering analysts always have all the inside baseball. They've been following the industry You certainly are a road warrior like us. We always see each other But we know we've been following your career. You've been on the cube many times and at oracle open where we laid out What oracle is doing then I was saying Dave earlier oracle always talks about ibm of all the vendors That's the consistent company oracle always talks about and ibm is looking good, right? The system z engineering system mainframe a bunch of other stuff now cloud focus So you're seeing ibm marching on the vectors that we've seen before more meats coming on the bone But what's your cake this year the new show wrapped up in one all these three shows coming into one Are they doing it right? with the show Could it be better? What's the focus? What have you hearing on the ground from the presentations? Just what's your take so far? So we looked at it from a couple angles, right the concept of the show is great right developers builders Infrastructure all the ecosystem. I mean that's what the show has really been about doesn't matter if it's mobile or cloud or if it's digital Transformation so so I think they got that part, right? I think the challenge is where do you put 21,000 people? Right? We're like shuttling back and forth, you know like 20 minute ride over here 20 minute ride over here And I think that's the harder part, right? But I think when the Manila Bay gets built out that thing that's going on back there with the construction They'll be able to get to 21,000 now the interesting thing is when you talk to the people that are here They're excited folks want to build right? They're ready to move Um, but I think the piece that's missing is they need to know what the business strategy What what is that story like what are we building towards? Why are we building? What is this transformation? It's not just the enablement. It's not just putting it in the cloud It's not just you know making things collaborative. So yeah, so I gotta ask you so when you look at companies that are in transition You look for things teasing out the data saying Is it what's as a real there and some companies just put lipstick on the pig and saying we were we got it IBM seems to have real deep stuff going on. Can you share your perspective? Where they're strong where they're weak where they need work to be done because clearly they're marching down the cloud It's just all about the cloud into the day big data is part of it So it's an idea of things you see now in the radar But this is the cloud the engine of innovation is the cloud standing stuff up. What's your take? You know, they're betting on the cloud. This is the direct to developer model, right? This is what it's all about. How do we get directly to the folks that actually matter? But on the other hand, we're seeing some interesting things. I'm think I'm I'm like right at the edge of nda, but they've been hiring all these external folks in And one of the things they don't know I sat down with the chief digital officer kevin egan today Right. There's a chief digital officer trying to figure out how to reinvent IBM on the inside so that they can serve developers They can serve customers better, right? There's a new chief innovation officer So they're bringing a lot of talent in so there's a talent change, right? So we're seeing the transformation culture now The other piece that's also changing is if you think that their models in terms of what they're really building They're going after all the high end high transaction data sources So you saw the you know, you saw the partnership announcement that was going on with juniper Let's get in at the network level. We've seen the twitter partnership the linkedin partnership apple apple partnership So they're focused on alliances. This is not go it alone. IBM. This is let's go build an ecosystem Let's go find people that get enterprise and let's work with them Can there be an inside out enterprise that's essentially what's happening You're seeing that the openness the community model not just what open source directed developers totally agree with you By the way, but like on the business side tell about startups to tell about startups here There's partnerships going on the open marketplace in the cloud Is that an inside out reinvention? Are they talking about that? What's the key things that they talk about builds into that? Well, they're still passionate around the developers, right? They know that's core They know they got to work with startups. You saw the startup program that's being built out You know, they're building the ecosystem. They still have the startup contest. I think that's important Can you build it inside out? I think what they're trying to do is this is the same transition gersner was going through During that period.  I think there's still a lot of work to do. I'd say I'd be impressed in the fact that they've made the hard cuts Right, they've trimmed out a lot of the fat. They did the reorganization around the cloud They have the reorganization around the watson group I mean all these things are really designed to say look the future of software is not the software where you remember We're not buying an on-prem box, right?  They're not even buying services. So let's quantify this a little bit Can we do that like so we're talking about a IBM with about a 25 billion dollar business in the strategic areas cloud mobile analytics And about a 70 billion dollar business and everything else and that's those the the strategic business may be growing 15 percent a year let's say 10 to 20 percent Yep So the big question is and the rest of the business is declining They got currency headwinds So the big question is can they sustain or even accelerate that strategic business that 25 billion? And grow it and can it offset the the cloud? Right, we've seen this this before I actually I you know you mentioned the gerson. I actually think they're in better shape than they maybe were because I think they're There's more clarity now, but You know can they do it can they pull it off, you know So here's the interesting thing that 25 billion has to be growing at about 40 to 50 percent right for them to Make that number in three years But that's the partnerships that are going to help them accelerate that so all these partnerships are doing Are 12 to 24 month bets these aren't going to happen right away But if they get them right and they're focused they're in place for that part of the business Can they differentiate? I mean take the apple partnership for example, they talk about a lot They talk about unique apps in the in the enterprise. Can other people copy that? Um, can you know s.a.p. You remember mcdermot a couple years ago at sapphires Told the story about how steve jobs called them. This was years ago. Yeah, I made that order for how many iPads Exactly, what are you doing? We're not we're not about the enterprise So my my question to you is do you think they can sustain that competitive advantage? Is there a competitive advantage there? I think there is because I think other people woke up wondering why in the world IBM got that business to do the enterprise based on the apple It comes down to this apple really doesn't seem like they want to be in the enterprise business But the ipad numbers are dropping like crazy on the consumer side long term because the ipads are getting bigger The only place that ipad growth is what? The enterprise great I got to get your take on the big data piece because when we were at big data svr event last weekend Silicon Valley had do but the world was going on strata had do Um, and uh, claudair announced 100 million dollars unaudited numbers almost half services summer speculating Horton worse had earnings today down dave down only 12 million revenue for the quarter below expectations In this pivotal Releasing open sourcing the open data platform with summer saying is resigning that sector Which we were arguing might not have to be a sector at all right when you look at the big picture What ibm's doing you look at that and that's a feature could be a feature of a bigger market Do you see it that way and because big data plays everywhere right? So can there be a big data pure play industry that or is that just all that stuff is just Going to be weeded out there can be a pure play big data in the industry But the reality is the is and past market in the cloud is where big data needs to reside Right and that's the challenge right and how do you actually make that occur? And if you've got an independent silo sitting out there and you've got all your other data Consolidate somewhere else. That's okay. But I think ultimately people are going to want to start consolidating Like the way we look at best of breed and sweets.  I mean ibm services Are deep and broad so I think it depends on the use case right? They're going to be use cases where people just putting stuff up fast and quick They're probably going to get up on claudair first and then it depends right depends where they want to go with their services It depends what they want to do with multinational rules. It depends on highly regulated markets what they have to do Right, so I think there's room for both, but I see the aggregation has always won. I mean you look at oracle That's what they've done really. Wow. They've aggregated services one stop shop You know ibm's in the same spot. They've aggregated services one stop shop and look at their pricing models They're based on what you bought last year Yesterday doug belog talked about the the key conversations that they want to talk about it and want people to join Join the conversation as we say it was one drowning in data to Consumption of customers on pram off pram and three ecosystem. So drowning in data. I got to ask you data lake or data ocean What's a better metaphor for the future? I think you're right. It's data ocean That data lake is way too small and like we talked about data lakes becoming data swamps those data oceans are now super fun sites Ray wing I've always thought you were brilliant, you know always you were always one of my favorite analysts now Your number one ray wings could be the number one in the leaderboard. We'll see how that happens Great. Thank you for for that. No, but oceans are different. You talk about the tsunami of ocean You know the tsunamis the currents are changing real time streaming. You'll time wait pipes, man You're surfing the pipe, right?  You could drink the water in the lake. Well legs have streams to the ocean So streaming Water salt water drink to water from the lake. Um, anyway, we're going over the top. So um, final question What's your take on ibm just in general your advice? I'm sitting next to ibm CEO What do you tell us on the senior vice president? What's the ray wing advice to us ibm if I work for ibm? So back to where we were in insights We were actually seeing the same spot um about four months ago three months ago and I think it's the same thing I they are going down at transformation and I think it's a very important transformation We're seeing the change the change in the people that are coming in there's management changes There's consolidations or different teams merging and I think it's right. You're right You're towards the cloud big data is still a huge part of it because that's going to be driving an insights business I think pitchiano bob pitchiano was saying that there's an insight economy that he's trying to create That's actually a very important thing that's actually happening because that's long tail on their business The cloud is the entry point the developers they've got to go galvanized and then in between they got to keep the rest of the Business is humming but you see the stuff that's coming out of interactive and design I mean gbs has a lot of tricks up their sleeve in terms of like growth and bringing customers in And so now the challenge is how do we fix the mix right all it people here? We're the business folks right who are the folks coming up with strategy and I think you'll see that in the ship I mean right now you look at every presentation. It's here's the product. Here's the feature Here's what we're trying to do and now it's digitally enabled. I think in six months It's going to be here's the storyboard of what we're trying to go. Here's the design solutions Solution selling it's talking about journeys. It's taking the design thinking bringing it up front by the experience by the outcome I think that's what we're head. Okay, so I like their whole systems of record I buy that old school batch model inside the data warehouse systems of engagement very very awesome messaging Love that's an open green field oracles going for it. But what's this new thing systems of insight? Is that marketing or is there any meat on the bone there? So there are systems of insight being created But I actually think the broader thing is these are systems of experiences and those systems of experiences are becoming Ultimately mass per