Howdy guys, IndiePixel here and what I wanted to do is show you guys, you know how I'm starting to use substance alchemist You know alchemist is still relatively new For our CG creation stuff, but I've been following it You know we're here and there and I've actually just started really getting into it and Starting to use it in conjunction with substance designer and it's really become more of my composition tool And I obviously think that's what they intended it for but it's a really slick way to you know really just focus on your core components like materials and filters and Atlases stuff like that inside of substance designer and just think of them as individual components like a piece of paper or a cigarette butt Kind of thing and then utilize substance alchemist as your composer of your textures All right, it's really slick workflow So what we're gonna do in this video is we're going to walk through the creation of this just to get you know ourselves More familiar with substance alchemist and what we're gonna do is we're gonna talk about how to import Resources from substance source, which is super sweet. We're gonna, you know, utilize the substance launcher here All right, and we are gonna talk about how to construct our Particular texture here that you see here with all these different filters that come with substance alchemist This whole thing was literally Started from a single base material and that material is this guy right here All right, and everything else was created inside of alchemist here All right, so I'm gonna walk you guys through that process just so you can see how to do it And I want to do more of these textures for you guys just so you can see, you know What I'm doing and how I'm working maybe you know share your thoughts about what you guys are doing the substance alchemist Still relatively new so lots more stuff to learn, but let's walk through the creation of this dirty wood floor All right, so here I have the substance launcher launched and this is a really great tool I highly recommend starting to use the substance launcher because it gives you access to all your Substance Applications really really fast now all you need to do is just go and go to substance3d.com Forward slash download and you can download it here All right So this will allow you to download the launcher and then it'll basically manage all of your substance software for you So what I'm going to do is come over here and launch substance alchemist All right, so now I'm still getting used to this but It's really fun actually and I really like how quickly you can start to generate new textures Just from all the you know materials that we have in substance source or materials that you've made yourself So here we have the substance alchemist project launcher right here And what I'm going to do is just go and create a new project and this is just going to be called YouTube textures I'm going to try to do you know a bunch of textures in here just to you know for practice and for fun So you guys can see you know what I've been doing and maybe provide feedback. All right, so for this particular Texture I want to make a wood floor that basically has you know a bunch of scattered stuff on top of it All right So what I'm going to do is I'm going to come over here to the starter materials over here All right, and this is in the explore tab So substance alchemist is kind of divided up into these different tabs to allow you to do Different, you know operations so explore tab allows you to find materials Inspire allows you to manage colors basically right and the create allows you to create new textures This is where you'll spend a lot of your time and then manage allows you to manage things like exporting your Textures managing your collections stuff like that All right, so what I'm going to do is just keep this guy on the plane if you want to change the actual mesh for this you can come over here to the settings the viewer settings and You can go and you know set it to any mesh that you want You can also come in here and change the the lighting for now I'm just going to keep this stuff the way it is right here All right, and so let's go back to our Explorer, and I want to find this wood generic All right, so just drag and drop that into the scene over here And this will basically allow us to get started.  These are all just basic substance Designer files right here. You can import your own as well You can come and play around with all the different settings. So you get something that you really like Do a mix of those two Noise flow that actually looks pretty cool just like that and you can change the knots density And really, you know a lot of this is experimentation with all these particular sliders over here So I'm going to increase the knots there. It looks pretty cool Yeah Really cool actually is going to be a way better for me. I want this to be not so shiny All right, so at this point we now have the wood that we want This is our base wood that we're going to then modify using a bunch of the filters that are available here in alchemist So what we want to do is we want to save it down into our collection. All right This is basically where you manage all the particular base materials that you have created. All right, so I'm going to hit the save button over here and You'll notice that it's going to be sent to the YouTube textures first collection. All right, and I'm going to call this the base Wood for now. Let's put a little underscore under there and it's save There we go. So now we've got our generic wood at this point. What I'm going to do is just go over to the create Tab now and this is where we're going to actually start to create our texture All right, this explores lets you explore different materials and you know change them and create presets Once you're happy and you have enough presets that you've created Move on over to the create panel. All right And we're going to then drag and drop this guy into a stack over there All right, so we can also delete it by selecting it and then just hitting the remove layer All right, so again, we're just going to drag and drop that into that stack there. Cool. So now we've got our first Layer for our texture, you know, and you can still go and tweak everything So you have all the different technical parameters here and you have all the the main Material parameters here that came out of the substance designer file. All right So let's move now over to adjusting things. So let's say now I've got this base wood Which is looks pretty cool, but I actually want to adjust things This is where we start using the filters over here inside about substance alchemist so if I come into the Tool and let's just put down our first filter I'm just gonna drag and drop this Adjustment filter on top of that wood there and what this allows me to do now is it allows me to play around with Adjustments on that particular base material. All right, so we can go and adjust the albedo sharpen it up a little bit Maybe change the hue a little bit. This is really cool because then now we have even further control That might not be available in this particular layer here We have all these other controls now over here, which is great. So I'm gonna increase that contrast a little bit Yeah, and because it is all procedural You can always come back to each of these layers whenever you want All right, so I think that's gonna be good for now The next thing I want to do is I want to get this to look more like a wood floor So again, we're gonna utilize a filter for this. So I'm gonna come over here to the Generator and I want to get the parquet pattern over here So I'm just gonna drag that and drop that into my layer stack and look at that. We now have a wood floor Pretty cool stuff Really really fast really easy to start making these textures All right, so instead of having it, you know go through and create a lot of you know different Network setups inside of substance designer You can you know make the little parts and components inside a substance designer import them into alchemist and start to compose your textures Really is a great way to as a as a composition tool Kind of sits on top of substance designer So you base basically build all of your base components inside a designer and use alchemist to compose everything All right, so let's go and make this stuff a little bit bigger here now. That's looking pretty good Yeah Something like that one thing you can do is you can utilize if you come down to the tool down here You can utilize the scale checker and this gives you kind of a reference about how big a human is compared to your texture Find that very helpful. All right, so I'm just gonna actually delete that guy. That's pretty good size for now I think let's play around with the offset a little bit Looks pretty cool. Kind of want to make it want to make it feel You know a little random there now the default Generators in here, you know, it seems like they're still getting things built for these and so there's not a lot of randomization Available for this particular pattern here But you could always go and build your own and import it yourself as well Which I'm gonna cover, you know as I start to get more familiar with alchemist myself But this is really cool. Just right off the bat being able to do stuff like this We can also come up here to the pattern type and change the type of wood that we have really cool stuff So if you're making, you know more of a wood floor that looks like that boom done already cool So I'm gonna leave that on English and at this point I feel pretty good about that I think I'm gonna move on and start to Do a little bit of weathering on this So let's start that off by Utilizing some dirt.   So let's go to the adjustment layer for this and go to the Reflection and let's just adjust some of this stuff. I don't need too much of that Roughness there. Cool. All right, so I'm gonna go back to the dirt here over here and Let's Just pull back the opacity a little bit more Maybe spread contrast. Yeah, I just want to make it. I don't need it to be so contrasty Maybe Pull down the variation on that there And I'll just pull down the quantity or even a little bit more. It's kind of want to rough it up a little bit All right, cool. I think that'll work pretty good. Let's go now And let's go and do some dust.  So we're just gonna drop down that quantity again And change that dust opacity as well. I just want to kind of rough it all up here. Yeah It actually looks pretty good so far Again, let's play around with that spread contrast and You can change the The roughness. It's looking pretty cool. So at this point I'm I'm actually losing, you know, a lot of my initial AO that I had so I'm gonna go down and Drop down another adjustment at the top here. And if we come down the ambient equation We're gonna say a recompute AO from new height. I'm gonna turn that on you can see it makes it really pop So now we can mess around with our AO again It's really just kind of recalculating it now with all the the layers on top of everybody So let's make a little bit more of a spread there Yeah, something like that cool Yeah, I'm really digging that All right, so I'm gonna say that that's actually good for now And what I'm concentrating on now is adding some more details to this so I want to scatter a whole bunch of stuff And now what I need to do is I need to go and start to source some other Materials that are available up on substance source itself. So let's jump over in a substance source using the launcher All right, so I'm just gonna come over here. We're gonna go to launcher. I'm just gonna maximize this For now and we're gonna go to substance source and what I'm interested in is all the new Atlases that substance, so I should say Adobe Provides us now so we have debris and that's what I'm gonna use I think what I want to do is I'm going to scatter some paper. Yeah, let's get this one So the way this works when you hover over it, right? It'll give you a little preview of how it might scatter I'm gonna actually send it over to substance alchemist. So I'm just gonna hit this button and It asked me and I need to be logged in and if all goes well What's gonna happen is it's going to then go and load this or download it and then send it on over to Substance alchemist for me. So I'm just gonna wait for that to finish I'll be right back. All right. Once it's done, you'll get some notification up here telling you that it sent it over to alchemist So let's go and check to see if it's correct So to view it you want to hit this little resources button here To go to that tab. All right, and you can see if this is closed You can always hit this little arrow right over here that we now have our cut cardboard pieces All right, so that's a really cool way of you know Just kind of managing all of your assets and stuff like that So what I want to do now is I want to go over to the filters and I'm gonna utilize this atlas scatter layer or off filter I'm gonna drag and drop that into there and by default nothing's gonna happen because what's what it's expecting is that you Provided some sort of input. So we need to give it that atlas that we just Downloaded. All right, so let's go back to our resources and I'm literally just going to drag and drop this over here Now be careful here because it's it's really easy to just go and assign it as a its own layer Like I just did there. All right, and that's cool, too That you can go and layer that stuff together, but it's not exactly what I want I want to actually assign it to this input right here So what you need to do is if you pay close attention here You can see that the little blue line jumps and that just means now I'm gonna assign it to the input one There we go. Awesome That is what I'm looking for So what I can do now is select the atlas scatter not the cardboard pieces and I can control the scattering from here and the first thing I want to do is I want to make sure that we aren't conforming to the background because you can see right now our Scattered pieces of paper are getting affected by each of the planks All right over there. All right. So what I want to do is just say Conform to background is set to zero there All right, and then we want to change the X amount something a little bit less Yeah, something like that Maybe change the scale do a little bit of random scale as well. It looks pretty cool, too and Adjust the height scale a little bit There we go And then let's go mask some random so we don't get everything all over the place And what I want to do now is I'm still getting those lines coming through and That is because it's coming from the ambient inclusion that we calculated beforehand So now we've got another element on of our on our texture So what we need to do is we need to come into the advanced parameters here for the atlas scatter layer and We want to come down to The ambient occlusion where it is there it is Recompute ambient occlusion. There we go. So now it's taking those pieces of paper in no account Awesome All right, so that's looking way better. Cool. So let's play around with some of these other tweaks here before we get into the advanced parameters Actually, I think we played around with a lot of this stuff. I'm just going to adjust the saturation a little bit the hue maybe Maybe make them a little bit more varied in their value now you can also come in and control their height scale All right, so you can put them on to the ground a little bit more pop them up You can also select the actual atlas material here And you've got a bunch of parameters that you can adjust as well. So you can come in here and adjust some of this stuff So let's say for instance, I want to increase that normal intensity on the pieces of paper You can also change their high position as well All right, so lots of ways to tweak stuff Very cool And you also notice that you know, we're getting you know, very jagged look here And that's coming from our viewer settings. So if we come over to the viewer settings over here and we go down to the shader We can go and change the displacement quality So this way you can control all that stuff and the amplitude and stuff like that You can also change the number of samples that we're doing. Yeah Cool I'm digging that All right, so let's go back to our filters over here. Now we've got that all set up Let's go and select our atlas scatter go into some of these advanced parameters now and Let's go and Change some more stuff. So it's changed maybe like a random hue, but not too much There we go. Yeah, it's looking pretty cool And maybe we actually add a few more of these Well, that looks pretty good. Just like that. Cool. All right I Think that is everything I want to do here. So to basically finish up this texture. I want to add one more Element to this and I think I'm going to go back to substance source over here So I'm going to go back over to launcher and I saw the cigarette butts over here I thought that'd be fun. So let's go and send this to substance alchemist and once that's done I'll be right back Alrighty Let's go back now over to alchemist and if we go back to our resources, we now have our cigarette butts So let's just collapse our last atlas scatter and we're going to go back to our filters and add another up here Very cool. And just like we did before, let's go back to our resources and get the cigarette butts and assign it to the input Like so And now we have a cigarette butts everywhere. All right, cool.  So let's just keep adjusting these guys gonna make these a little bit smaller There we go. It's pretty good And let's change that value a little bit more so they're not all the same color And let's go into our advanced parameters and we're gonna recompute the ambient occlusion That way we get that looking pretty good. Now in this case, I do actually want to conform to the background because well Some of these guys aren't going to be perfect for that. So I'm actually going to turn that off and Let's also do a mask random. It's one of so many cigarette butts on the ground I don't want to make it look like this floor is Being lived in by a chain smoker Cool. So with that we now have our texture and I think I'm gonna go back to the paper let's hit the Paper options here and I want to make the scale just a little bit bigger. Yeah Cool and I also want to maybe change the height scale a little bit more You can see as we do that the cigarettes will Try to adjust themselves appropriately Let's go back to the cardboard layer here and play around with the right position as well So I'm trying to get them so they don't feel as flat And really this is what you do. So I love this so much. It's really fun really easy And really efficient when it comes to making textures Cool, so I'm gonna call that good for now. I think that's pretty good stuff I think as a final pass. I am going to put on another layer of dust. So let's do that So let's just put another layer of dust on top of all this. Let's just pull it back a little bit Something like that and maybe change the depth here volume Definitely want to change that spread contrast We want to change the slope as well Yeah, it looks pretty cool. Very nice And we'll pull back the opacity. We don't need to be so intense Cool, look at that. We now have our texture. So once you're happy with your completed design What you can do is you can actually save this out as a preset itself. All right So you can see right here. There's a little save button.  That was That was a fun one for sure. Okay And what I want to do now is obviously I want to export all this stuff out So what we can do is come over to the export tab over here and we can Just say export current view and that will launch this guy And you have the option to export out all the different textures And you also what I thought was really cool is you have the option to save it as an SPS or sbar file In this case, I'm just going to save it out as a TGA Renew 2k texture and I'm going to send it to my folder for all this stuff. So let's go into the work folder and Let's go into the YouTube here And let's go and just call this dirty. Actually, you don't need to make a Folder for it. You just need the top folder because the export manager is going to nest it in a folder with the name of The material so now if I hit export It's going to go and export everything for me and then we can go and hit this little button and boom there we go We now have all of our textures Saved out and ready for our game All right, so hopefully you guys enjoyed that. I'm gonna you know as I get more familiar with this I want to really start to you know show you guys the power of all this and show you how to make your own custom filters Obviously how to make your own generators stuff like that for substance alchemist But this was just kind of a first step in that whole process So we'll make more textures to you. These are all really fun to do I love the fact that you can just take some base materials and some patterns and some Atlases and boom have a whole new texture out of that. Thanks so much guys


Look at this juicy burger! Doesn't it look appetising? It has so many good things in it that my body needs. Protein and fats in the meat and cheese, carbohydrates in the bun, vitamins, minerals and fiber in the salad. But how can I use them? I need to get them into my blood and this burger is never going to fit. That's where digestion comes in. Digestion is the process of breaking down food to make it soluble in the blood. You can digest food in two ways, mechanically and chemically. When I put this burger in my mouth I do both types of digestion. My mouth breaks it down mechanically using my teeth. This mashes up the food into smaller pieces. My saliva carries out chemical digestion. It contains an enzyme called amylase. That takes the big starch molecules you find in the bun and breaks them into smaller pieces called maltose. However, this is just the beginning of the digestive journey and a lot more needs to happen before this burger is going to be small enough to be absorbed into the blood and taken around to all my hungry cells that need the nutrients. The next stage of digestion are summarized in the next videos of the journey. Humans carry out internal digestion as the food is digested inside our bodies. However, other organisms digest the food outside their bodies. Fungi, for example, are called saprotrophs. This means that they secrete enzymes out of their cells onto food around them and then absorb the nutrients once they have been broken down.  Lovely. Imagine spitting on your burger until it's just a soup and then eating it, yuck. Anyway, let's get back to humans. The whole process of digestion can take a long time. It takes six to eight hours for food to pass through the stomach and small intestine and almost 40 hours before you see the remains of your burger coming out the other end. Probably the most amazing thing about digestion, however, is that a lot of it isn't actually done by ourselves, but by 100 trillion bacteria living inside our guts. They help break down certain foods for us, make vitamins and help with the immune system. So there you go. With the crushing some enzymes and some friendly bacteria, you can turn this juicy burger into small soluble molecules that can be carried around in the blood.


All right, so dignitaries, ministers, vice-chancellors, distinguished guests, friends, and colleagues, it is my great pleasure to be able to introduce to you this afternoon's keynote. Before I get started, for those of you that I haven't had the pleasure of meeting, my name is Neil Fasina. My day job is to be the president of Athabasca University. And so if you run into any of our team members from AU, they are the rock stars that keep me motivated because of the talent that they bring to the table each and every day. So this afternoon I have the distinct pleasure, like I said, of introducing our keynote address. And I've been asked to keep it brief, which is incredibly difficult when you consider the length of this man's vita. And so just a couple of highlights for you. Following what is arguably an unbelievably remarkable career, our guest speaker retired just earlier this year from being the professor and principal research investigator in the School of Education, Communication, and Language Sciences at Newcastle University. After achieving a PhD in solid-state physics from the ITT in Delhi, our speaker focused early years on studying energy storage systems, which, to name a few, resulted in the design for a new zinc chlorine battery. In the early 80s, his interest in computer networking sorry led to India's first local area network-based newspaper publishing system, which then led to this individual predicting the desktop publishing industry. His interest in the human mind led our speaker to be among the first to demonstrate that simulated neural networks can decipher the mechanisms of Alzheimer's disease. And in 1999, you will likely be familiar with this individual's work as he conducted what was referred to as the Hole in the Wall experiment, in which he embedded a computer in the wall in the Indian slum of Kalkaji, sorry, Delhi. The experiment demonstrated that kids could be taught computers without formal training, something he termed minimally invasive education. This experiment inspired the Indian diplomat, Vikas Swarup, to write his debut novel. This debut novel, ladies and gentlemen, later turned into the Oscar-winning movie, Slumdog Millionaire. He brought these results to England in 2006 and created self-organized learning environments throughout England and around the world. In 2009, he created the Granny Cloud for teachers to be able to interact with children around the globe. And among the long list of accolades and awards, our speaker was given the first $1 million TED prize in 2013 to create a series of seven labs called the schools in the cloud. Needless to say, the impact of our speaker's work on the lives of people and economies around the world can only be guessed. Ladies and gentlemen, distinguished guests, it is my great honor to introduce to you Professor Sagata Mitra. Well, good afternoon. I must tell you something interesting. The length of your bio-data increases with time. I hate to think what will happen 10 years from now. Well, many people in this room have no about the hole in the wall experiment. They were speaking to me about it. This talk is about where that went eventually. But there's also something interesting that I need to say because this is the PCF. It's one of those kind of historical coincidences. You know, in 2006, I moved from India to the United Kingdom. I had lived in India for over 50 years before that movement to the United Kingdom. The day before I joined Newcastle University, I spoke at the PCF in Jamaica. And I flew from there into this new country where I discovered you always need a coat. So, and then this year, I retired from Newcastle University. You know, I live in a small town called Gateshead in northeastern England. I retired this year from Newcastle University because I have a pond and it takes a long time to look after a pond. So, having retired, this is after my retirement, my first keynote. And guess what? It is at the Penn Commonwealth Forum. Anyway, yeah, big circle, isn't it? So, I'm going to take you through mainly these years, from the time when I moved to England until now, what happened after the hole in the wall. I had a different title for this talk, which I had to change due to popular demand. The title of my talk was The End of Knowing. And I was told that this is not exactly a wonderful title to have for a room full of teachers. All right, but I think you might understand as we go along why it was called The End of Knowing.  It could be a series of drops falling into a pond or something, or it couldn't be an ocean. No, that's too heavy, something, a flat water body. Anyway, so just keep that in mind. I'll come back to it in a moment. It has something to do with children. Well, 1999, just for a few minutes, because everybody insists that I must talk about the hole in the wall. The thing won't go away. Here it is, 26th of January, 1999, New Delhi. Well, as is obvious from the picture, it's a computer, it's stuck into a wall. It's got children because it's three feet off the ground. It's got the internet on it. It's actually running Microsoft Windows with whatever internet was available in those days.  There were people who didn't know what a computer was, and there were people who, many people who didn't know what the internet was. So the experiment was what would happen if they were confronted with it, particularly children. And what happened was this experiment, which I didn't call it the hole in the wall, the press. The Times of India called it the hole in the wall. And that name stuck. I'm gonna show you just a few seconds of an old film. It's been shown over and over and over again of the first, after about an hour or so of an eight-year-old boy and a six-year-old girl. As you can see, she's not very tall. And then hundreds and hundreds of children, all milling around. A few weeks later, children downloading games and things, playing all sorts of things on the computer, the Delhi government putting in 30 of them in the slums of Delhi. Everybody very happy about, guess what? We don't need any teachers. Okay, it's all happening by itself. People started asking a question, who is teaching them? And I really had no answer to that question because there wasn't anybody teaching them. So, you know, the question that they didn't ask was, how are they learning? Instead, they asked, who is teaching them? Anyway, we learned the following. Unsupervised groups of children can learn how to use the internet. No, big deal. I mean, that's 20 years ago.  I have a question. Isn't it obvious? So, I used to tell them, no, it wasn't considered obvious for children to be able to learn how to use a computer by themselves. It's not a big deal anymore. So, I brought this method over to England. And, you know, school teachers in northeastern England had heard of the experiment and they were kind of curious about this guy who's done this hole in the wall experiment. Can we do it here in England? And I told them, we can't. We cannot do the hole in the wall experiment in England. You know, why? Because all you'll get are frozen children. I mean, try doing it outside here today. You can't do anything outdoors in this country. So, anyway, the school teachers persisted. Come on, be serious, do something about it. So, I said, all right, we will do the hole in the wall experiment in the UK. We will turn the hole in the wall inside out. And how do you do that? Well, very simple. I know there are many teachers here. It's the simplest thing on the planet. Take a classroom, put in four or five computers with big screens. Big screens are important. Just scatter them around the classroom, connect them to the internet, get about 20 children inside. So, they'll come in and then just ask them a question. But ask them something interesting, okay? What's an interesting question? Well, let's imagine an interesting question for British children in England, in Gateshead. Do you like potatoes? Yeah, chips, that sort of thing. And, you know, I'm from India. Do you think they eat chips in India? Oh, do they? And their teacher said, can't you think of anything other than chips? No, well, I mean, this is an important question. Do they eat chips in India? Well, the answer is yes, I said. But they didn't used to. Back in the 16th century, they didn't know what a potato was. They said, well, I didn't know what a potato was. I said, yeah, many people, in fact, most people in the world didn't know what a potato was until the Portuguese came. And they said, the Portuguese, who are they? I said, well, now it's your turn. You tell me, I'm gonna give you 20 minutes. You tell me, what did the Portuguese do with potatoes? This is the kind of question that nine-year-olds love. What did the Portuguese do with potatoes? Maybe you like the question also. It has an interesting answer. And they brought the potatoes all over the place. Anyway, so you said this question. So now the children in England said, why are there only four computers? I said, I don't know. I said, that's all I have. So Emma, my school teacher friend, said, should I tell them to make groups? And I said, Emma, if there are four computers and 20 children, what else do you think they can do?  So Emma sat down and the children made groups, but not exactly groups of four, but groups of five, six somewhere, four somewhere, whatever. Then they started talking because, you know, four or five children working together will talk. And I had to insist and tell them, listen, you can talk, okay? You can talk. You can talk loudly if you want. You can run around the room. You can look at everybody's work because I am not interested in who finds the answer. My life's mission is only one. I want to know by the end of this period, what did the Portuguese do with potatoes? And the nine year olds would go for it. And they would tell me everything about what happened. We made the questions harder and harder and harder. And we kept getting answers. We gave it a name. We called it the self-organized learning environment. The soul. It's kind of obvious, isn't it? Self-organized. So what is a soul? Well, as I described to you, there's a lot of text on this, you know, set up a few computers, bring in a lot of children, ask them a big question, allow them to talk and walk, give them some time. And at the end of it, say, I want only one answer. I don't care from where. I'm not interested in whether she knows the same thing as he knows and then so on and so forth. I want an answer. And that's all. That's a soul. It started spreading all over the world from Gateshead. He was French. He was born in 1839, and he died in 1906. So all the way from Southern Australia to Argentina to Brazil, or throughout, you know, England, bits and pieces of Europe, finally the United States. I just observed, just watched all this. With a bit of wonder saying, but goodness, this thing is just spreading by word of mouth. And you know why? Well, teachers in England explained it to me in not very kind terms. They said, whenever, one of them said, whenever you're not prepared for a lesson, do a sugata. So I wish it was because of wonderful educational pedagogy, but it wasn't. It spread around the world because a teacher could sit back and watch learning happen. She, I think, learned the difference between how do you teach versus how do they learn? So after several years, after many experiments, all of which is published and available on the internet, I had to write this very dramatic statement, unsupervised groups of children can use the internet to learn anything by themselves, anything. Anything, say, what about some esoteric bit of physics? What about quantum physics? The answer is yes. Not that they will write down the equations of quantum physics, but they will explain it to you in their nine-year-old way. In this case, from Gates said again, quantum physics, things can be in two places at the same time. That's about the heart of it. I learned that in my PhD. So how does it work? By this time, we had this question reverberating around the world saying, OK, we know it works. It's working. I've seen it work. How does it work? Who is doing the teaching? Where is the learning happening from? I just could not figure out the answer. I read everything I could. I'm a natural scientist. My PhD is in physics. So I had to struggle with social sciences. I read everything I could in the social sciences. Couldn't really find an explanation until I turned back to my old subject, back to physics and found that there is an answer, actually. There's a sort of an answer. The answer to how were the children learning lies in this sort of thing. How did that plant figure out how to make a shape like that? Nobody knows the answer, do they? Some people would say there is superior intelligence. Some people would say mathematics, the Fibonacci series. Some people will say the symmetries of nature, but we really don't know. We don't know how it makes that beautiful thing happen. But we know this much. It happens by itself, and it invariably happens. And you can apply both sentences to a self-organized learning environment for children. It happens by itself, and it invariably happens. What happens? Learning. So the answer then was inside this subject, lying around all these years still bumped into it, self-organizing systems. Mathematicians knew about this for a long time. They don't know how it works, but they know about it. Things which make themselves happen, like this, the murmuration of stalling birds. Any individual bird inside that has no idea what it's doing, except there's sort of flapping around trying to follow the one in front of it. The whole thing forms a pattern, but the birds can't see that pattern. Is that what's happening to us? Is that a part of life that we don't know about? Patterns that we can't see, because we are a part of it. Got a rather poetic name, emergent behavior, and spontaneous order. Order that comes out of nothing. OK, I shall remember the water drop, that picture of the water drop. Let me show you where it came from. It wasn't falling in. It was falling out. The first drop fell in. The water body, which is connected, molecules of water responded, and they threw it back up. An exact replica. So after I retired this year, I went back to something I knew how to do quite well, once upon a time, programming. And I thought, why can't I simulate what happens if things are connected to each other and allowed to self-organize? And I started getting some interesting stuff. I can't tell you too much about it, but I can show you one of the experiments.  Each dot looks around at its neighbors and behaves and decides whether to remain a dot or to vanish. That's all. It's got a name. It's called cellular automata. But anyway, you take enough of these dots in my program, and you show it a picture. And then you remove the picture. And here's what the dots do. And I'm watching this sitting in my study in my house. I'm watching it over and over again and looking at these cellular automata. Remember, how can you do that? I'd actually written a paper about it a long time ago. You can read it on the internet. It's called Fractal Replication in Cellular Automata, something like that. Anyway, so they're very simple systems, and they recall images. But I couldn't help think of my water dot. Wasn't that doing the same thing? Or was it? If that water drop is what the cellular automata experiment is doing, then is that what's happening inside the self-organizing systems of children's minds? Is that what we teachers do? We show them the image, and then we wait until they recover it or integrate it or do whatever it is with it. And is this what we call learning? I'm not going to go any further into this, but if this is the case, then we have some semblance of an answer to the question, who was teaching them? It wasn't a person and it wasn't a thing. It was a set of interconnected minds. How does it work? We don't know, but we are the first generation of human beings who have seen 4 billion human minds connected to each other. When you do that, then like my program or like the water drops, that entire thing murmurates like birds, forms patterns that the individual elements cannot see. Are we living through that? Well, that's another story. But is it that the self-organizing systems of Gates said and the first self-organizing systems of the whole in the wall were actually telling us about this mechanism of how it all works? In that case, what should we as teachers do when you know that the children are inside this huge enormous network and they're pursuing a question, a question to which perhaps you, the teacher, don't even have an answer? Well, there's only one thing you can do. It's not as though you have to feel pessimistic. I am not needed anymore. That's not the case. Here is your role. You go there, I'll go with you. I think it's a nice thing to say to children. A nice thing to say to children who have access to the internet. I don't understand your world. I don't understand those games. I can hardly use my mobile phone.  So what does the adult do in this case? Well, the adult sits back and admires. You just say, wow, you did that on your own? You figured out what the Portuguese did with potatoes. My goodness, I couldn't have done that myself. OK, then I thought, well, this is a good method. Let's give it a name. I called it the method of the grandmother. Think of the grandmother's role. Not like what do the parents do? The parents say, you must practice more. You must practice maths more. You did very well in English, but very badly in mathematics. Therefore, you must study only mathematics from now on. That's the kind of thing that parents do and teachers do. But not the grandmother. The archetypal grandmother says, you're fine. You're the best little girl in this whole world. So what if you didn't do well in mathematics? I used to hit mathematics myself. I called it the method of the grandmother. I wrote an article in The Guardian saying, if you have an internet connection and a web camera, and if you have an interest in children, can you give me one hour of your time every week for free? And I got hundreds and hundreds of people from England and all over the UK, really, who volunteered. We gave them a name. We called them the Granny Cloud. The Granny Cloud sits up there. And wherever you have children in need of an admiring, self-organizing teacher, you beam them in. They don't teach. They have a conversation. I'll show you an example of one of the very first sessions that I did from my office in Newcastle University with the city of Hyderabad thousands of miles away. The center was the audio there. Anyway, she was reading the gingerbread man to them, actually. But it won't make much sense to you and you get the audio. But that's her. That's my colleague in England. And that's the children. What actually happened was that their accents would start to change, not in days, but in minutes. Minutes. I saw it later in one of the schools in the cloud experiments in India, where it was in Bengal. And I can speak Bengali. So there was a little girl. A couple of months down the line, I went back to the school. And I said, in Bengali, I said, OK, I'm going. Goodbye. And she said, take care. So I said, where did you learn that from? And she said, you know that woman who comes on Skype? She doesn't understand anything other than English. That's all it takes to change the little girl's accent. It's simple, really. So admiration and encouragement used correctly will produce rapid learning. I think we all know this, actually, just that we don't use it as often as we should. So in 2013, I got a prize. It's called the TED prize. It's a lot of money, million dollars. So as you might imagine, I felt quite happy. I was going to call my bank to say, guys, no more three-digit numbers from now on, et cetera. When TED told me, that's not how it works. You use the money for research. So I gave up my ideas. I was planning to buy a boat. But I couldn't. I don't have a boat. But I spent the million dollars in building seven experimental facilities called schools in the cloud. What I did there was I brought two ideas together, the self-organized learning environment and the granny cloud, put them together into one place and called it the school in the cloud. This one's in County Durham. You can get an idea of the place. Computers with big screens, groups of children, a granny on the wall, a big question. In this case, the question is, why does red go with black? I can see that there are many people who agree with that combination. The question is, why does red go with black? Why not purple with green or something? Do you know the answer? Ask the nine-year-olds of Durham. They'll tell you. It's deep inside anthropology. The answer, very, very long time ago. Anyway, so I built these schools in the cloud in all sorts of exotic places. For example, this is Killingworth. In India, it would be considered an exotic place. Killingworth near Newcastle. Very close to where the steam engine was invented. A perfect implementation of a school in the cloud. The most remote of the lot, the Sundarbans, where the Ganges meets the sea, is a solar-powered, remotely connected to the internet school in the cloud with six or seven computers. It needs nothing, really. Six or seven computers with big screens. Why big screens? So that everybody can see what's on the screen.  Why big screens? Because four or five children can gather around it and discuss what's on it. So the big screen is very important. In Korakati, the name of the village near the Sundarbans, we got our first of the clues from measurement. The steady upward rise in reading comprehension. Easy to measure because reading comprehension, there are pretty standard tools for measuring reading comprehension in English. This is in English. And the steady upward rise. Now you might say, but there's a flat bit in the middle. What explains that flat bit? I'm very happy I have that flat bit. Because if you look at the internet resources in that school in the cloud, the flat bit shows a period when the internet was down. You can't have better proof than that of the incredible effect of the internet on reading comprehension. Why not? If children spending all their time in groups looking for the answer to a question and reading page after page of internet, nobody tells them what's meant for children, what's not meant for children. In those remote villages of India, there were children who would quote out of the Harvard business review in a couple of weeks. They don't know it's not meant for them. Another one in Bengal here, the biggest ones that I have built so far. So what do you do? How do you run a school in the cloud? You build this facility. It should look nice, colorful, bright, lots of glass walls. You should be able to see everything that's going on inside it from anywhere around. That's very important. The mums want to know that. They're not going to let their children into this new facility where they know there are no teachers inside and not know what's going on. So you've got to have transparent walls. Then what do you do? You've got computers. You've got the internet connection. You have one guy or one man or one woman there who's the supervisor, mainly for health and safety, law and order, that sort of thing. What does she do? At a certain time in the morning, she opens the door, lets the children in. And then guess what happens? At a certain time in the evening, say, about 5 o'clock, she closes the door and lets them go home. The internet does the rest. This is what it looks like. So, you know, bedlam, chaos. But then that's at the heart of the system, isn't it? You don't get self-organization unless you have chaos to start with. So you've got to have the big question. It's called an attractor. You've got to have the chaos. You've got to have the freedom. And you've got to have the internet. So we did study this across all seven sites that I had. And everywhere we got the same straight upward line for reading comprehension. So by this time, three graphs had emerged. The first one from the hole in the wall at the bottom left-hand corner, which basically says that children can figure out how to use an electronic device, information device, by themselves. You don't need anything else. I think all of us know that. You've seen five-year-olds with cell phones. You don't have to teach them anything. That's the first graph. The middle one, reading comprehension, I already spoke about. As they search on the internet, their reading comprehension go up. Actually, I should say their comprehension goes up, because it's not only reading. It's also videos, it's audios, it's everything. So the general level of comprehension goes up. The third, the one on the top right-hand side, is their ability to search the internet goes up with time. What does that mean? It's very important. They begin to figure out what websites or which websites are not right and which ones are. Which ones agree and which ones don't. What's fake news and what's not? They figure all of this out, 8, 9, 10-year-olds, by themselves in a couple of months. I think it's one of the most important life skills that a child today should have. Unfortunately, doesn't exist in a curriculum and is never asked in an exam. But the school in the cloud does do that. So basically, schools in the cloud improve reading comprehension, produce a kind of sense of well-being, causes learning with good retention. I've got measurements on this, publications and so on. Improves communication and collaboration. And it changes the teachers. To start with, the teachers are gassed at the idea. After a few months of it, they realize that they're most important because they raise the questions. That's the end of the good news. In the few minutes that I have, here's the bad news. The system versus the soul. The system is like this. You're all familiar with the system. We've all been through that system. Sit alone, don't have access to any device or anything at all. Don't look left, don't look right. Okay, dress properly. You know, sit up young man, et cetera. So that's the system. What was it for? It was meant to produce people who would sit in those offices. Remember, the world was run by those offices. There were no computers. You're talking about early 20th century. The entire world used to run using these administrative systems. You needed millions of people who were identical to each other and all of whom had three important properties, reading, writing and arithmetic. You should be able to read and understand.  Otherwise you can't sit in that office and process the books. This particular picture is from Calcutta of that time. The books in question were, I believe the accounts of opium trading or something like that. So, here's what an office today looks like. Okay, doesn't it remind you of the hole in the wall? There are these guys, they've got a problem. They're hanging around the internet trying to figure out what's wrong. So to produce a generation who can fit into that, don't we need an exam that will look like this?  Go to any shopping mall. You'll see them in rows and columns staring at their phones. Why can't that be the exam? Okay, you know, Eldon Square and Newcastle is our downtown. Why can't you have an exam question which says, what's the best shoe sale in Eldon Square next month? Why not? So I've been saying this for years now, completely unsuccessfully to many governments. Use of the internet should be allowed during examinations. Everybody says, yes, that's okay. What time's your train back? Next thing, the internet should be learned like the sciences, arts, and mathematics. It should be a subject for everyone's sake. When you send a message from your phone to another one using WhatsApp, how does it travel?  They say, and what's a server? Oh, server, you know, a server. Serves, you see. I mean, what is this? You don't know how the internet works. You use it 24 by seven, but you do know how a steam engine works. There's something wrong with the curriculum. I think we should change reading, writing, and arithmetic into three Cs. Comprehension, communication, and computing. Example, you are a dentist and you want to hire an assistant to just help with your admin work in office. A young woman appears with a GCSE A level and says that she's got an A plus plus in history, A B plus in mathematics, and A in English.  I don't think so. So what's missing? Why isn't that certificate telling me what she's good for? It's only telling me that she would be okay for a early 20th century clerk's job. That's all that certificate is still telling me. It's wrong. It no longer works, not fit for purpose. It was perfectly okay in the 1920s. If the Victorians had been around, they would have said, I'm sure they would have said, what on earth are you doing with this today? Well, the purpose of education, I guess, should be to enable people to live happy, healthy, and useful lives. There's a problem with that, actually. Happy, healthy, useful, everybody agrees, except that you can't define any of them. Happy, we don't really know what that means. You can measure levels of chemicals in the brain, I suppose, or you can see how wide a smile is. I don't know how you measure happiness. We don't know how. Healthy, well, we're in safe grounds. Blood pressure, blood sugar, body mass index. That's it. If those three numbers are okay, you're healthy. Any doctor knows that that's nonsense. We don't really know what healthy means. And useful, who's to say what's useful today? What's useful? You tell me what's useful. I think what's useful is to be able to use Google Maps when you need it. That doesn't come in the GCSE. So I think we need a curriculum of not all the things we know. You know why? Because all the things we know are in our pockets. You can figure them out at the point of need in seconds. So does that mean we do away with curriculum? No. I think we need a curriculum of all the big things that we don't know yet. Children love it. If you tell them, here's a list of the big stuff we know nothing about. Nobody knows. Even the internet doesn't know. They'll go for it. It's energizing. And I think ultimately it's the questions to which we don't have an answer that has driven human civilization ever since we got down from the trees. So why a list of things we know? We need a pedagogy that is immersed in the internet. Instead of having a debate about whether children should be allowed to use mobile phones in school, we should do the opposite. A child should be in the internet 24 by seven because that's the world that she is headed for. An assessment should be changed completely. We need an assessment which will tell you something about the individual, about what the strengths of an individual are rather than the letter scores in a few boxes. English, math, science, that sort of thing. So that's about it really. And by the way, my publisher has said I must put this slide up as the last one. I have a book coming out. Should you wish to read it? It's called The School in the Cloud, by the way. So anyway, this is the end of my talk and thank you very much for listening.


TheCube at IBM Impact 2014 is brought to you by headline sponsor IBM. Here are your hosts, John Furrier and Paul Gillan. Hey, welcome back everyone. We're here live in Las Vegas for IBM Impact. This is Silicon Angles theCUBE, our flagship program. We go out to the events, we start to sing with the noise. I'm John Furrier, the founder of Silicon Angle. Here's my co-host, Paul Gillan, co-hosting here with Silicon Angle. And our next guest, we're excited to have Steve Mills, Senior Vice President, Group Executive, IBM Software and Systems. Welcome back, Steve, to theCUBE again. Good to be here. Great to have you. I got to say, the Pulse interview was fantastic. We had so many tweetable moments, quite a great interview. It was setting the table, really, for what's happening here with customers. So, first take on Impact here has been about power systems, blue mix kind of getting some legs. Sea legs are kind of getting established. Is that what you guys expect? Is that what you guys wanted to say here? And what's the key messaging that you guys are putting forth? Well, I think clearly those are two of the most important focus areas for the conference. In our blue mix, we launched at Pulse and it went into beta. We got the, actually many thousands of developers to begin to use it. We're now kind of ready to come out into the marketplace in a more formal way. And blue mixes, as we've discussed, it's an open platform for DevOps. It's all about APIs and components, how to rapidly develop applications. And it's sort of these next generation applications that are very much around engagement, interaction. It's certainly not the kind of thing you look to for your back end ledger based systems, but it's all about those end user facing and customer facing environments where you need that kind of rapid development, iteration, mobile device enablement, those kinds of things. And it's where a lot of the excitement is in the industry today. So blue mix, open platform, but with back end integration into your back end environments and very much geared towards not just what the corporate developer might be looking for, but also the new business startup. The kind of thing where entrepreneurs can come in and find componentry that can map against the kinds of things that they want to do. It's interesting that DevOps certainly captured the attention of the early adopters around Amazon and the public cloud. But when you start talking about enterprise, it's not just the start of getting a little more resource. It's enterprise grades, serious conversations. So you've got to please two masters, the in-house kind of nuts and bolts in the kitchen, so to speak, and building out and growing the infrastructure capabilities. And then the business line manager you mentioned, which are basically like, hey, just get the job done. So is that something that you see? Is it two masters? Is it designed that way? How do you view that? Is that a misread on my part? No, I think that for whether it's a corporate in-house application development team or somebody who's trying to build up a new capability for commercial sale, you do end up serving multiple masters. If your end target audience is going to be a larger-sized business, you're going to deal with, on the one hand, can I get the rapid development and deployment capability that I've come to expect around these DevOps environments. And by the way, I've got to fit into the corporate infrastructure. Do I comply with that? So if I'm an entrepreneur starting a company and my customer base is going to be enterprises, this environment provides me with ways to create those links into traditional enterprise backends. So I arrive not just with the next SaaS offering that stands alone in the cloud, but it's a SaaS offering that integrates better into the corporate customer environment. And let's face it, lots of entrepreneurs are starting companies where their target buyer is a corporate buyer.  Amazon's buzz has been sort of around, they're the default for the startup company, for the new company to go put everything in the cloud on Amazon. IBM has legacy of the enterprise customers. How do you make those enterprise customers that legacy into an asset instead of liability? Well, a couple of things. First of all, just to sort of correct the record, the SoftLayers company, we bought them last year, there are more URLs running on SoftLayers and on Amazon AWS. So in fact, there's a very popular environment for startups. I think people misjudge that or have bad information. SoftLayers is more popular dramatically so than Google and it's hosting more URLs than any other software infrastructure environment in the industry today. So we start out with a good base with all the classical tools and techniques. Get on with a credit card, rapid deployment, now we're adding platform as a service, dev ops. We're bringing our SaaS properties on, we have over 100 SaaS offerings in our portfolio that'll be up and running on SoftLayers. And then of course you get to the enterprise buyer who in many cases has been sandboxing in AWS or SoftLayers or somewhere else but is often struggled with how does that translate then into production. So I might do some development work out in the cloud but for reasons of corporate rules and regulations I'm not putting production. And the SoftLayers environment provides a very unique infrastructure, 1600 APIs, rendered explicit, you can see absolutely everything going on, it maps to the corporate audit and compliance requirements. We're incorporating security services, data loss protection, integration, compliance with different standards. So all of this is geared towards satisfying the needs and requirements of the corporate world as well as the startup world. Well that's interesting, audit's a great example. I mean for instance Amazon's not strong, I don't think they have audits or at this point but that's a great example, that's table stakes, right? You can't roll into the enterprise without audits. Do you see that? Those kinds of things, the real kind of straw that breaks the camel's back to. Well I think it's absolutely a requirement for corporations to go into production. And again it's providing 100% visibility. Can I see what server I'm running on at the serial number level? Can I see all of the storage volumes that are being used for the data? Can I see all the changes, the updates so I have a total 100% auditable path for how that environment's been operating and everything that has happened to it. If it's 100% traceable, I now have the ability to satisfy my auditors that I've got a reliable environment that they can actually interrogate and understand what's happening. Is that just, Amazon's just not ready there, they're growing up and they're still kind of like in elementary school for enterprises or is it just that just haven't gotten to it yet or is it a technical limitation from your thinking? I think putting aside for a moment what they have gotten to, in fact the matter is they haven't necessarily staked out that production environment as being their top environment, I mean their last few years obviously they've had a lot of success in attracting start-ups. They've done well in the public cloud. The venture funded companies find Amazon AWS to be a place to start because people's colleagues they're starting there so they're attracted to that. The corporate environment has a lot of other requirements and frankly Amazon will have to do a lot of evolution of their platform to get up to the level of auditability that we have. We know they're working on it. Wouldn't you like to reach some of those and wouldn't you like to have a Netflix in your portfolio? How do you, what's the strategy of getting to those companies? Well, obviously you have to provide better economics, better manageability and quality of service that makes your environment attractive. So we have a lower, as the amount of data that you need to store away increases our costs remain relatively linear and AWS costs skyrocket. So for large amounts of data and in fact matter is in all of these public cloud environments if the only thing you're looking at is cost to compute you're not looking at the real cost because the real cost is networking and IO. And as the data increases the soft layers environment actually becomes more economical than the Amazon environment. Needless to say we're out talking to a lot of companies about their options of moving on to soft layers. By the way, here at this event we're featuring the Aspera technology. Aspera is the underlying high performance, high bandwidth, point to point and multicast technology that underpins Netflix, right? It's the mechanism they use to deliver their streams. Well, we acquired the company. So they're here at the event and we're showing off this capability. Hey, the tail can wag the dog as they say. You know, so to speak. So look, we're hunting out where the profit pools are. So it's more than just having a lot of customers or, you know, having a lot of volume. It's also, where can you make the money? I love talking to you. I like how you talk. Sticking claim is a good way to look at things. So before we talk about power for a second I want to talk about the cloud marketplace, right? So as you stake out that claim it's not just an app store. It's not just like the flavor of the month. Talk about what you mean by cloud marketplace. Is it for businesses? Is it for the developers both? What is the clean positioning of cloud marketplace? Well, where we're going with marketplace is to make available a very broad range of components and API interfaces to invoke function. And this is something that we'll populate with components. We're going to work with various companies, systems integrators and ISVs to encourage them to push their components onto the environment. We're going to let our corporate customers actually create their own private development instance within the blue mix infrastructure. And then they'll use that marketplace to get at components that they use. And by the way, they'll be able to put their own components in but keep them closed. In other words, not open them up. You have a private marketplace. Yeah, so they have a little private marketplace for themselves. And everybody knows that the greatest efficiency comes through high level of reuse, right less code, reuse the components you have, taking advantage of as many API based interface structures and things that you can pull in. And these very highly productive DevOps models are very much based upon this whole idea of code less, design more, script, use components, bring things in that are already built. And also distribution, developers get distribution and sharing, so that brings that openness feel back to it. Is that part of the design as well? Absolutely part of the design. So it's, what people will find there is not just things from IBM but from every other part of the industry. Obviously, open source components, things that are available broadly in the marketplace on some of the other environments that are out there. You're going to find those in the IBM environment. So, you think about what people have found and liked about AWS. Think about what they've found and liked about Azure, Heroku, Engine Yard. Go through the list of all those players. All of that and more will be in the IBM marketplace. Now, Steve, marketplace is as Apple and Google and Salesforce and such have defined very much a numbers game. It's how many partners you get in there, how many customers you get in there. How should we evaluate the success of marketplace a year hence? Well, we're going to provide that score sheet of value. So what starts out as hundreds becomes thousands and then tens of thousands. Obviously, at some point now the richness of the environment is less the issue because you can find a great many things there and then it gets into aspects of tooling, patterns. Particularly for many developers, they're looking for a pattern to be instantiated in the environment. Let me show you what others have done. Here's a sample set, here's a pattern. If you want to build this type of application, here are the things that you bring together in order to effectively turn it into a kit that delivers the application that you want. But clearly, volume, volume, volume counts in the beginning. Get as many components as you possibly can into the environment and then begin to create these sample sets, the patterns, the pre-kitted, if you will. All right, so it's great to be able to find lots of things. It's even better to be able to find exactly what you want. Steve, I got to ask you about the bubble. I wrote a couple of articles this week about it. Obviously, we saw a couple of things. Intel made a big acquisition, I mean, investment in Cloudera. Huge valuation over the top. Pure storage, which is a storage array. 25% the value of NetApp, I mean, $3 billion. I mean, it's frothy, but it's an innovation bubble. What's your take on this environment right now? I mean, obviously, valuations are high. Is this an indication of the old storage bubble? Is it the convergence? Is it a new animal we've never seen before? I mean, what's your take on that? Well, look, I think technology generates a lot of excitement. You know, I mean, the information technology is the transforming technology, certainly of our age and will continue to be, I think, you know, throughout the rest of this century. And so that creates excitement and it creates a sense of future value. Now, at some point, you look at those valuations and you say, well, how does anybody get a return on that? But clearly, if someone's willing to spend the money, you sort of say, well, you know, it's kind of like your house. It might not be as nice as your neighbor's house, but if someone comes in and really wants it and wants to give you a premium, why wouldn't you take it type of thing? I mean, Fusion IOs is looking pretty good right now. So is Violin Memory. It's $300 million valuation. Did you say they overpaid? Well, the frothiness, it's not sustainable, right? You know, it's not sustainable forever, right? So there, you get these peaks and valleys. You know, WhatsApp, does that price make any sense? Only in light of how much money, I guess Facebook had had an equity to spend with it. And by the way, you should know that WhatsApp runs on softwares. Yeah, we nailed that at pulse. Okay, I mean, you've done a lot of small acquisitions, very large number of small acquisitions and by all accounts, a good job of integrating them. How about a big acquisition? What kind of latitude do you have to do a blockbuster? Well, it doesn't really match the model that we're on. I want to be able to take advantage of the skills, the talent, the energy of the companies I acquire without having to spend a lot of time dealing with aspects of culture. And the larger the company, the more the cultural issues begin to weigh you down and slow down the process. We have a huge portfolio. This is, in fact, the largest software portfolio in the tech industry. As big as it is, there are always gaps. If I can find those gap fillers, then what I can do with those gap fillers is actually put them in my go-to-market capability. I'm in 170 countries with tens of thousands of people representing IBM. I can scale up those companies dramatically faster than they could ever scale on their own. And the IBM shareholder gets a nice return on that investment, right? Because that investment of IBM Cash becomes accreted very quickly. The larger the acquisition, the harder it is to run that play. We've done some, you know, clearly some larger ones, billions of dollars, but you know, relative to our size, the actual size of the company. 10 billion is a new one billion, they've been saying. No, at some point, it doesn't make sense to shareholders. You guys have been good at tuck-unders. You guys have, you guys pick good value deals, make them part of the engine. That's what you're saying, is you're saying, pick the risk up the table. It's our shareholder's money. You know, we work for the people that own us. It's their money. If you're an investor in IBM, you want to see IBM use the money responsibly. And the last thing you ever want to see is an autonomy-like acquisition, you know, coming from IBM. That's not on our menu. No way, no how. On the white spaces now, obviously being, you guys have a lot of organic R&D going on. So, and also you got the M&A, which is kind of the tuck-under strategies we just talked about.  Is it the orchestration? Is it automation? What are you looking at as territories that you need to claim in there? Well, first of all, we look across our whole portfolio as to the kinds of things that we want to go after. And, you know, it's understanding the patterns of implementation of the products we have. Where do those gaps exist? And would a piece of technology from another company fill in that gap? Very often we're partnering with the companies that we buy before we buy them. So we see how they fill that gap in what the leverage is. And we're investing obviously in the hot areas. So, you know, you think about, you know, mobile security, all kinds of analytics related acquisitions, things that fit into the cloud, which is more about deployment. So, you know, we're investing where the market is moving the fastest. Because that's where the greatest pressure is to, you know, try to keep up with where the market's going. We did set out to talk about power. So we should talk a little bit about power before we're done here. Open power, you've got a huge endorsement from Google today, so it's moving its stack to open power. However, it occurs to me, you're taking on Intel, essentially you're competing with Intel now, at a time when you have a lot of other initiatives to pay attention to. Why is the open power initiative not a distraction from other bigger prizes you could be going after? Well, power is a big business for us. There are 100,000 plus companies out there that use power. It's an important franchise. And we're looking at it from a long-term perspective. The market, I think, has been looking for server alternatives. You know, clearly the server market space has compressed as far as players are concerned. IBM and Intel are viewed as kind of the last two companies standing. And clearly Intel has volume advantages. No question about it. You know, so we're looking at our position in the marketplace and what companies like Google and others are looking for to balance out their server portfolio. What attracted them to power was the fact that this is a very high-performing chip. It's got excellent threading characteristics, data throughput. So the amount of compute power per unit of electricity consumed and heat output is outstanding. You then combine that with an open licensing model, which is what we adopted around open power. We essentially looked at the kind of licensing patterns that ARM, for example, has benefited from, which is the popular chip in handheld devices. And so we've gone out with this ARM-style licensing. That means that for relatively low entry point cost, you become part of open power. You can source from us. You can actually fabricate with others so you're not uniquely tied to IBM. You can find others that can make these kinds of things. You can do derivative works off of your license. So it's a non-restrictive license. It's not a proprietary license. It's open license. It's derivative works, but how is this different from a GNU public license, that type of model, where your derivative works become part of the open stack? Well, we're not using a GPL-style licensing, right? So if you want to do extensions, you can do extensions, and those are your extensions. So you think of Apache-style licensing in the software world, you can actually leverage our license in the same way you would. You don't have to contribute the IP back to the... But you own the extensions you create. You own the extensions you create. Oh, by the way, as a participant in the community, you can also offer those extensions back. So there you have choice. It's not dissimilar from other, if you will, non-GPL-like licensing models, where you have the freedom of action. But as a community participant, you may very well want to push it back in. It's personal innovation. Is there another shoe to drop in the Google relationship? They have enabled their stack on power, and they obviously, they acquire chips. They go to third-party fabricators, and they make the sleds that shove into their racks, and power will now be part of their configuration. Steve, what's your big bet on the power? I mean, obviously you're seeing some trends that we were speculating earlier on. Obviously we're going into a maker movement-like developer market where you've got tinkerers playing with hardware and software, so the threading thing makes a lot of sense there, but also the analytics market with internet of things is exploding. Obviously you're ingesting unstructured data and just dealing with it later is a big part of the analytics piece. Did you see those things? Is that one of the big, what's your big bet of those? Well, one of the key design points of power eight and the power of family going forward is what we refer to as this high-performance bus architecture that allows essentially a coherent programming environment, but you can connect other processors into power. So I program through the power chip, that's what my developers see, but I can actually schedule a workout to a field programmable Gatorade, to a GPU, so we're partnering with NVIDIA, Altera, Xilinx, the popular providers, and therefore we're allowing those that want to engineer unique system structures to be able to do that. So if I wanted unique encryption to improve my security, I could use an FPGA and do custom encryption. If I wanted to do some kind of advanced analytics, Hadoop related speed-ups, I want to do pre-processing around predicates and sorts and those things. I could be using the NVIDIA GPU program natively through the power chip, but get all these other advantages. And so we've made this an open environment that you can plug other things in. So in a sense, you can build your own hot rod. I mean, this is all part of the big development, right? I know, I love it. Everybody wants to build their own hot rod. And if the pieces and the components are there and you have good engineering skills, you can build your own hot rod around this. It's like American graffiti for technology, just cruising down Main Street with your hot rod. Absolutely. So what does your hot rod need to do? Is it big data, big transactions, low latency, data encryption, you talk about the domain and we can adapt to that domain. So you get a souped up device or car with the engine you want under the hood. But what's interesting too, would it be safe to say in the statement that with power systems, the big bet is that you can provide high performance technology at the same time support scale out open source commodity hardware. Exactly. So that's essentially the bet, right? Yeah. You're not going to pick a side. You can win in both. We moved the architecture to a little Indian. We've made Linux 100% portable without change across into the power environment. We make it easy for all that work to come across. We have this hot rodding capability around the architecture, open licensing. So it's multiple dimensions in which the leverage, the base level capability of power, which has always gotten high marks for its scalability characteristics. You bring to the common man now. And now make it possible for other engineers to jump in and do their own thing around this environment. And frankly, that's what many people in the industry want to do. They want to do their own thing. Steve, anything in the Watson area specific to power? Will we see kind of a Watson hot rod that IBM might build? Well, Watson runs on Linux on power today, where all of the Watson deployments we're doing are being done on power. Right, but optimized power is what I mean. And with power eight, we already have a level of optimization through power eight's unique features, for high bandwidth IO and threading. And then we're actually doing a set of customizations, specifically for Watson to take advantage of the NVIDIA GPUs and how they can speed up some of that work that the cognitive system needs to do. So they'll be a Watson hot rod. Okay, but Judith Hurwitz was on earlier talking about Watson and saying that Watson is such a complicated ecosystem. There's so much to Watson that it's, IBM has to move slowly and moving it out there really as a general purpose engine. Are we going to see, we've seen a lot in healthcare lately. Are we going to see other industries go big in Watson in the near future? Yeah, and we've already had some announcements in financial services, insurance, advisory type services, the things that would be clearly a bit simpler than the healthcare challenge that we're taking on with Watson. You know, we have announced at this event a Watson environment for corporate developers to actually come in and sandbox. We're encouraging entrepreneurs. We've got a dozen different universities that beginning their next fall cycle begin to teach the principles and structures around the Watson environment. So we are clearly opening up to a broader ecosystem and we've made it modular. It's a system, but we modularized around a platform structure so you can effectively only use the pieces that matter to your particular application scenario. So Steve, if I want to shift gears into big data, but before we do that, I want to let you know that you're famous on Twitter because you now have a fake Steve Mills Twitter. Did you see that? I've seen this before. I don't know who this individual is, but they... They're certainly not doing a good job being the fake Steve Mills. They do seem to want to take advantage of... I'll see you in Twitter. It's a compliment. We consider it a compliment. But that brings up social data as a form of big data. So I got to ask you, do you see data as just a part of the fabric of the platform across the portfolio? Or do you see it becoming a P&L? Because we've talked to folks today from power to streaming web sphere across the board. It's all big data nuggets sprinkled into the platform. Is it going to be just an embedded feature across the portfolio or is there a P&L around it? First of all, we do measure our total business analytics business. Bob Pitchiano, who works for me, has responsibility for all the basic material that makes up our business and analytics portfolio. And that includes those things that apply to big data scenarios. So that's solutions. Yes, now frankly, I haven't met anybody recently that's doing little data. So every analytics project that I'm touching is always big. And it's how many terabytes off it in the hundreds on the way to petabyte scale environment. So I do think that the market has moved in that direction because the price points have come down, the ability to ingest and analyze more data has improved economically. And so businesses are saying, well, if I can bring in more data, can I find more patterns? Can I unearth more nuggets, more jewels? Things I could act upon that previously I couldn't act upon because I could never afford to bring all that much data together. So frankly, all these analytics projects have become big data. It's hard to nail the technology you're saying into one division, but the solutions you certainly can P&L price out and sell to. Absolutely, yeah. And frankly, it's mixed data types. It's structured and unstructured. And classical relational fits, but certainly not the only technology. And you've got to deal with document format data, graph data, object-oriented structure. So many different data types and techniques. We have a very broad portfolio that touches on all these different mechanisms. We're a Hadoop distributor. You saw we acquired Cloudant recently. We're doing a lot of things around very complex data structures in many industries. Is big data a P&L for you, or is it an app? Well, business analytics and database are P&L structures for us. We don't explicitly break out big data as a unique space just because- It's broad. What happens is everything is quickly big data. Again, who's doing small data? All data, all data is big data, yeah. That's just the way of the world. That's where the world's going. We were joking earlier about back to the 80s as we were talking about some of the, how the mainframe selling was 50th anniversary, the innovation around that. And so just from the terminology we've been kicking around today, data processing, decision support systems, MIFS, it feels a lot like those days of, you know, when that kind of language is being used. Now you're hearing it mainstream, pipelining data in this new era of Cloud. So is Cloud the mainframe, has always been the discussion, how does that look like? I'm not saying the mainframe for IBM, but like as a metaphor, it seems like a mainframe, I mean power systems, you're essentially saying, here's some high performance capacity in brains to whatever you're connected to, here's a marketplace, it feels like a mainframe. Do you guys? Yeah, we'll see how these things evolve. I think that we're really in many ways at the early stage around these public cloud environments. Now, there are numerous companies measured in the tens of thousands that have been delivering services electronically, and they're often production services, and by the way, mainframes are part of their environment. So if you go into ADP, Depository Trust Company, go into United Parcel Service, anybody that's put up electronic services around their capability, you'll often find mainframes involved in that service offering. Their customers are interested in the outcome, they're less interested in what the underlying technology is, but as a provider, they've built up an incredible reputation for reliability, availability, security, and so on, they're trusted providers. The public cloud environment has obviously been characterized by startup companies, entrepreneurial activity, a lot of systems of engagement, types of approaches, new apps that are touching users, not nearly as much on the production side, but this public cloud world will grow up to deliver more production ready infrastructure, and some of those mainframe attributes are going to have to be evident in the environment for reliability, availability, failover, recovery, et cetera. My final question for you is going to be more about what is the outcome of the cloud, the ultimate determinant of cloud success for all the folks out there. You see Microsoft's doing, they got a war chest of in the billions, some say 30 to 50 billion for M&A activity, the new CEO over there, you got HP, you guys, and everyone else, Amazon. What are going to be the key determining factors for the cloud? Is it going to be economics? Is it going to be scale? What's your take on how you view that chess game? Well, the top 10 items are economics. I mean, you can't deny that it's economics because information technology is a tool that you use to power a business, and so the business model comes first, the technology comes second, and when the economics are right, you can do more with technology. You know, and it's not that other attributes are not important, but the economics take precedent, and the excitement around public cloud is very much driven by the perception that I can find better economics. Can I be more agile? Can I adjust and adapt? Can I get the technology that I need when I need it, but not necessarily have to pay for all of it up front? So all those are appeal points, and they're very much tied to economics, so that is the fundamental driving force. I think one of the mistakes though that is often made in describing the market as it exists today is to ignore the thousands of companies that are business process service companies who predate the use of the term cloud, but who nonetheless are delivering very valuable services electronically, and businesses have for decades been been de-verticalizing in effect. As a company, I might have had all my own systems doing all my own apps 20 years ago, 30 years ago. Today, I use all kinds of providers, and some of them could be literally born on the web. It might very well be salesforce.com for my Salesforce, but it could be ADP for my finance department, and ADP is as much in the cloud as Salesforce is. There is much of dot com as Salesforce is a dot com. You know, it's just a different constituency that's being served by an electronic service. This final question I'd have is how you're helping internally make that switch, because we see a lot in the reseller channel, in the integrator channel, they're trying to move from this box sale compensation structure to selling subscriptions, having a lot of difficulties with their sales force making that transition. What have you been able to do? What kind of success have you had in getting your sales force to transition to selling subscription services? Well, first of all, we did the very simple thing of compensating them equivalent to whether it's on-premise or in SaaS, which means we apply a multiplier that delivers to them compensation. They become neutral to the deployment. That's a good solution. So that's a starting point. Yeah, sales reps are coin operated. If you don't come up with a coin, they're not going to respond. But I think even more important to the point that you're making is that around all of these services, if information technology is something that transforms business, then it's not just the product itself, but rather the roadmap for transformation, which means that there's a services model that goes behind all of these software as a service offerings. How do I get onboarded? How do I adjust my business process to match what the SaaS offering does? So there are big services opportunities, implementation opportunities. Frankly, many of our partners are truthfully regional systems integrators that also carry technology. We're allowing them to participate in the SaaS sale, but in particular, they're engaged in the onboarding and in the enabling of process to actually make the SaaS offering do something for the customer. Steve, thanks so much for joining us.  I'll give you the final word. Share with the folks out there the bumper sticker for your customers and your troops internally for your mission over the next year. What's the bumper sticker to the troops and the customers? Well, let me express the bumper sticker in terms of this particular event that we're at because we do a lot of things in IBM. But this event is showing people how this whole idea of rapid, agile, flexible invention innovation can take place within businesses by taking advantage of the kinds of tools and offerings that we're bringing to the marketplace. It's lifting the classical middleware infrastructure environment, if you will, up to this next generation of interfaces, uses, mobility, flexibility, DevOps. It's overlaying the new things into that infrastructure. And what it effectively does is it renews the infrastructure.  The vitality of our portfolio and the importance of the role we play with our clients is directly related to this idea of renewing, renewing, renewing. And if you can bring that renewal around the latest capability to bear, the customers want to go with you because they've made a big investment over a long period of time. Steve Mills, Senior Vice President here at IBM Edge. I mean, IBM Impact. Be right back with our next guest after this short break.


There's no easy way to transition into this, but I did want to talk about how you became CEO of this wonderful company. It's quite a story. And so if you could just share a little bit about the founding of Mother Raw, how you got involved, and then ultimately how you, or how you're now leading the team, absolutely. So when I started with this business, I had left behind a career in CPG of about 25 years. And I was really looking forward to going from big and bureaucratic to small and scrappy and fast. And I was brought in to help do a little bit of consulting work. So the company was actually called Raw Foods. So a different company name, different brand name. And it was founded by a woman named Michelle Kotman. And by the time I arrived on the scene, Michelle had already successfully had a VC invest in her company. And they had been invested for about about a year and hadn't quite had the traction that they would, you know, were looking for, which is often the case, I think, but they were, you know, they kind of decided that what they needed was somebody who had my experience to come in and give them some give them some perspective. So as I was in that process, about two and a half months in, Michelle, who had, who had been very supportive of, you know, just figuring out how to take her vision to more, more, more eyeballs and more stomachs. She passed away at the very young age of 45. And it was like the lights went out in the company.  And so it was at that time that, you know, I was able to, I'm not able, that I willingly and went forward as CEO to really with the passion of taking what was and is an excellent proposition. And now we're, we've gone from what she had 300 stores, which on her own was fantastic. And we're in 3,600 now. And I just think she's shining a light on what we're doing. It's amazing. And what, I mean, I can, I shared with you before where I knew of one company who lost a co-founder and how it was just really, you know, it's the DNA of that person still exists. And, you know, leadership tries to make sure that that person is remembered in everything that you do. And you had mentioned a story to me about how, I'm hoping you can share it about how her daughter came in, right? Her 19 year old daughter while you guys were doing some sort of branding work. And what was that? Yeah. What was that like? Yeah. That was really cool. Basically, so Michelle has two kids, Laurel, her oldest daughter and a younger son. And Laurel came to work with us after her mom passed as an intern that summer. And we were in the throes of really getting down to the fundamentals of this brand. What is the mission? What is the vision? Why do we exist? How could the world exist without us? Our why, right? And she was with us for that work. And she was able to impart, you know, her perspective from, she was, her mom was very close. She used to taste test everything with her mom. So she was, you know, very, very clear on what her mom's ambitions were. And so she was part of the whole rebranding effort, which could have been seen as quite threatening. You know, you changed my mom's brand, but it literally, she was just so supportive and loved what we were doing because she saw why we were doing it, how we were doing it. We also redeveloped all the products. And we did that not because we needed to change the fundamental of like the ingredients. That was so important and is important to us. It was important to Michelle. But just because Michelle wasn't a professional product developer, right? She made these recipes and came up with them herself, but I was able to, I have tons of experience in innovation and product development. So I was able to bring in the right person to work with our ingredients to redo all the products that needed redoing.  So it made it very, it wasn't about, you know, the commercial success. Of course, that's, that's, you know, part of it, but it was about doing it in a way that was the right way, sustainable, true to the original vision. And Michelle's a question to herself, the challenge that she posed to herself that led her down this path was, why the heck can't my salad dressing be as healthy as my salad? As easy as that, right? And I mean, how many people say that they don't do anything about it? And I was one of those people, right? And so we stay true. And when you think about the name Mother Raw and how it relates to the story, you know, Michelle, Mother Earth, Mother Raw, the Mother Raw, you can see how it all came together. Hey, everyone, thanks for checking out that clip. If you enjoyed it, be sure to hit the like button down below. And if you're interested in hearing the full episode, it's out right now on our YouTube channel. We've had a lot of great guests come on this show before, and we've got a lot of great guests coming up in the future. So hit subscribe so that you don't miss a single episode. And one final note, we're always looking for new ideas and new companies feature on the show. So if you know of someone or know of a company, write us a comment down below letting us know who they are and what they do. We'd be happy to have them on the show. Till then, I'll just be here waiting for your comments. So, uh, see you later.