On this episode of The Six Five Insider, hosts Daniel Newman and Patrick Moorhead welcome Dell Technologies’ Adam Glick, Sr. Director of Portfolio Marketing for APEX and Multicloud.
Their discussion covers:
- Key insights to the changes in cloud computing, particularly as businesses look for more tailored solutions
- Dell’s belief that the future is multicloud, and how cost-savings is driving enterprises to reconsider their approach to cloud
- The solutions Dell APEX is providing for customers as they look to operate in a multicloud by design environment
- What to look forward to at this year’s upcoming Dell Technologies World event
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You can listen to the conversation here:
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Patrick Moorhead: Hi, this is Pat Moorhead and we are back for another Six Five Insider, where we feature the most relevant companies with the most influential executives. Dan, we are here talking cloud. We love cloud. It’s great to see you, man.
Daniel Newman: Yeah, it’s good. These Insiders are always fun because we have a little bit more time and capacity to go deeper, and this is a topic I think that Patrick really requires that we go a little bit deeper. We’re seeing the pendulum swing. It was going to be cloud first, then it was going to be cloud only, and now you’re seeing it going back to cloud first maybe, and then you’re hearing more about prem and you’re hearing hybrid multi. It’s changing fast, Pat, and I want to talk today about where we’re at with this.
Patrick Moorhead: That’s great. Let’s introduce our guest, Adam Glick, Senior Director, Portfolio Marketing for Dell APEX. Adam, welcome back to the show. Great to have you.
Adam Glick: Thank you so much, Pat. It’s great to be back. Dan, good to see you.
Daniel Newman: Yeah, it is good to see you. It’s like a thinner, better-looking version of myself. I enjoy that. It’s a great way to start my show. Better glasses, everything. Just better, better, better.
Adam Glick: I appreciate the recommendation on the barber.
Patrick Moorhead: Yeah.
Daniel Newman: Yes, it’s-
Patrick Moorhead: Dan, can you just be more like Adam, please? Yeah, all right.
Daniel Newman: We’ll talk about this offline.
But no, in serious, look, I am really glad that we’re going to have this conversation with you today. This is something that’s been on my mind a lot. And while a lot of headlines have been dominated lately by AI, where we put our workloads is going to be really important in terms of how we’re able to capitalize on the opportunity with our data and with these next generation technologies.
And I think over the past decade-plus, I’d say even 15 years, we’ve seen that kind of trend line that I talked about, Adam. We went from everything’s going to the cloud, everything’s going to the cloud, and then all of a sudden it seems like over the last couple of years, the discussions changed a little bit. So the economics are still compelling in some cases, certainly the flexibility and the agility to sort of set up services, scale on demand, but all of a sudden we’re starting to see that the tools, the technology, the flexibility, the portability of workloads is saying, “Hey, you can do things in that cloud operating model without putting everything in the cloud.” And as data proliferates and data scales, there’s a pretty compelling case to say maybe not everything needs to go in the cloud. In fact, maybe most things which still are could be on-prem. Talk to us a little bit about what you’re seeing, hearing, and thinking as it relates to customers, their multi-cloud strategy and workload placement.
Adam Glick: Sure. We hear a lot of different things since each organization’s deployment is really different. There’s no kind of one-size-fits-all. It really has to be tailored to what are the needs and goals of that organization, and we find that that varies widely across the different organizations that we talk to. What we do see is some common antipatterns that we’ve run into. There’s a lot of folks who have just lifted and shifted stuff into a public cloud, and we tend to hear from them about costs being a lot higher than they expected, also performance might not have been what they used to, and that’s really true around things when people are super latency-sensitive, things that they’re doing, things that might fit better, say, in edge or things that were built with software that really requires really tightly bound latency pieces.
So the reality is that each environment that you can run in, be it colo, edge, private cloud, public clouds, and even between the different public clouds is different. And we see customers who assume that each place they can run their applications, they’re all going to operate the same way are finding that’s not the case. The key insight around public cloud that we’ve heard from customers is the major benefit they get from it that you mentioned earlier is really that massive scalability and access to resources they can spin up and down at will. For people that have workloads that look like that, public cloud is an amazing option for them.
The other thing that we hear most often is that customers haven’t actually written their applications to scale and do that in most cases. And so they’ve lifted and shifted things, put them into a public cloud or they’ve been written by development teams, that that’s the way they know how to develop monoliths and build that way, and in those cases, we find customers are asking us what they can do.
Patrick Moorhead: So I am happy that the cloud has matured like a kid growing up, right? Sometimes we forget that the first public cloud service came out in 2004, right? And then the industry cut their teeth on OpenStack, and then we realized that OpenStack was open, but it wasn’t a full stack, you had to fill it in yourself to complete it, and it was revved every year, which just wasn’t fast enough. And OpenStack lives today in certain carriers and retailers, but we really moved on to containers, and I know, based on your background, you know a little bit about that. But it’s good. We’re no longer this gangly teenager related to cloud. Cloud is no longer a place. It’s really an operating model. And the industry, with elements like APEX that I know we’re going to talk about, is addressing things like scalability, right? Because if you go back to the first definition of cloud and what it is, it has to be scalable, it’s typically open source, it’s API-driven. It takes a while to get there.
And there’s no doubt in my mind. I mean even Andy Jassy, CEO of AWS, said in a recent article and appearance on CNBC that 90% of spend, actually said this on his earnings call, 90% of the spend is on-prem. So there’s a lot of reasons that that’s happening. And there has been a lot of talk about “repatriation,” taking something, a workload that I put in the public cloud, and bringing it back to run on-prem or the edge of the network. Can you talk about Dell’s experience, your customer’s experience, what you’re seeing out there?
Adam Glick: Sure. So at Dell, we believe that the future is actually multi-cloud. We don’t think that things sit in one place or another. For many IT organizations, public cloud, private cloud, colo data centers, and at the edge are all going to be part of their IT estate of how they think about how they run their operations correctly, and much of the solutions are really specific to those customers’ needs and the particular business unit and even workload needs that they have.
And as it turns out, a lot of customers are realizing the applications, they were optimized for the wrong environment. They faced the question of what solution is best for them, and they kind of end up in this situation of taking a look at what do they do. Do they refactor their apps? And that can help them operate best in the environment they’re in. The challenge they face with that is if you’re going to refactor or rewrite your apps, then you’re taking really valuable development resources and instead of building new value for an organization, you’re essentially rewriting value you already have that works. And so it’s a very expensive option that not a lot of folks want to jump into.
They could repatriate them, like you mentioned, and then in some cases it’s not even repatriating. They may actually be moving out of a public cloud and just moving that into a colo facility, say for instance, where they never actually had a data center to begin with. But some folks say, “Hey, the right thing to do is actually move it back. That makes sense for us,” or in other times, they may just resign themselves that it’s a new reality and they live with the current state because they’re focused on other things.
So there isn’t really one answer, but we find is when people are talking to us about repatriation, when they do bring that up, we find the things that pop for that are really around security concerns, like how much can they actually control, who accesses the data, where is that data located, what controls do they have over that, and they also tend to talk to us about cost. And cost tends to flag a lot because when we’ve talked to folks and we’ve worked with them, we see them saving somewhere between 40 to 60% in general on infrastructure costs, and that tends to be a number that opens eyes and makes people say, “Hold on, maybe I need to look at this.”
Daniel Newman: Well, I think one of the biggest misconceptions was the way cost has crept was that this was going to be an amazingly profitable OpEx-favorable situation for most enterprises, and I think we’ve seen some of the math, we’ve seen the repatriation. I think it was a16z and Andreessen Horowitz did an interesting survey where they looked at this, and there seems to be some real inflections in spend, and this tends to ring true with both the infrastructure part of cloud as well as the apps part of cloud.
Of course, when you’re small and you’re running lean and mean, the ability to spin up a workload or sign up for a SaaS-based CRM solution and just get started 10 bucks a month, but all of a sudden you’ve got thousands of workloads running concurrently and you’ve got all this compute, all this storage, all the data, all the services that you’re adding on, layering on. You got data going back and forth, you’ve got egress, you’ve got network charges, and now with AI, you’re going to have massive investments if you think you want to train your workloads in the public cloud, and I think all of a sudden it has come all the way around again and everyone’s like, “Well, maybe we just buy our servers, or consume them, but we put them in our data centers, or we do something that’s a little bit different.”
So we’ve seen that. So this is the big challenge I’m seeing, Adam and Pat. You and I have talked about this on the Six Five a lot. But I imagine to get to this state, it’s not just the economics. There’s got to have been other things. So why do you think these challenges are becoming so big and obvious? And if it’s economics only, let’s lean into that, but what else are you seeing?
Adam Glick: Wow. So there’s a lot.
Daniel Newman: There’s a lot there, there’s a lot there.
Adam Glick: The reality is different workloads will matter in different cases. I mean with AI, you can be taking a look at one, are the resources available, and two, the cost on that one, and there’s huge differences on those, but there’s also questions around how the data is used, what the contractual terms are of that. Many companies see that as like that’s their crown jewel, is if data is the new oil, I forget who coined that phrase, but if that’s put out there and you think about that, what you’re doing with that data, who has access, and what rights they have to use that and how become really important to organizations.
On the broader issue, I think the reality is that most organizations are multi-cloud these days. We got here because there’s a lot of things that have happened, and that’s made what should be a benefit into a burden for them, and we often refer to this as kind of being multi-cloud by default. It’s easy to happen. If you think about it, shadow IT teams spin things up, you’ve got special development teams that are all working on their own building things, companies are making acquisitions, they acquire a company that has a different cloud strategy, using a different public cloud, maybe using a private cloud. All these things come together and then people want to do best of breed. The reality is each environment has things that they specialize in or are better than, and so you end up with multiple different public clouds, private clouds, colos. You end up with all of these things together, and it’s basically a multi-cloud mess.
And this leads to like, okay, now you’re there, you’ve got all these different things, and what happened? Well, you’ve lost your agility at that point. You need different skillsets to be able to do what you want, you’ve got gaps in what you’re doing in terms of how you secure that. When I say that, I mean the applications and the network. You’ve got new challenges around what new tools you have to use because some of the tools that you’re used to don’t work in those other locations. And sometimes you just had organizations where they had a mandate, “Hey, we’re going to move a third of what we’re doing into a public cloud,” or, “We just signed a deal with a new public cloud vendor,” say for instance, “so we’re going to have to move everything over and figure that out.” And so people can find themselves with a lot of challenges they didn’t expect because this all came together by default without taking a really planful approach on those things.
I’ll give you an example. So if you think about someone who said, “Okay, we’re just going to move something into, say, a public cloud, and so I’m going to lift and shift a server,” and that server runs a hundred percent of the time. How many workloads where you have the server and it just runs all the time? Lots of them, and you can check your bills if you’re curious about it. You’ll see those things. You’re not using that ability to scale up and down, and you pay a premium for the compute in the cloud because they offer that ability, and it’s an awesome ability in the use cases where you use it and where you need that. But if you’re not using that, it can be really costly.
So these days, we hear a lot of talk about cost optimization. Even the public clouds are all talking about what they’re doing to try and help cost-optimize. What we see is forward-thinking organizations are looking more broadly, they’re looking at optimization broadly, and cost is certainly a factor, as you mentioned, but there’s also security, latency, scalability, skillsets, tooling. There’s a lot of different pieces that go into that. An organization’s optimizations can actually become technical burden because you optimized for one thing and then you end up actually needing to do something else because the goals of the organization have changed over time. And so those that have set themselves up to be more flexible to be able to move between cloud environments that they have to change what they’ve prioritized and what they’ve optimized for, those organizations are much better positioned to be able to take leadership positions, to take share, and to out-maneuver their competitors. We call that multi-cloud by design.
Patrick Moorhead: So I think we are all in agreement on this video that the future is hybrid multi-cloud. We might not use those exact same words Dell uses there. Futurum Group uses another word, Moor Insights & Strategy might call it differently, but we’re pretty much talking about the same thing. I talk to a Fortune 500 enterprise at least every other week, and I’ve yet to interview one, talk to one that didn’t have more than one IaaS provider.
So the fact is, all enterprises are multi-cloud, at least the largest ones, and some of those who might not have command and control from IT may not even know that they have another IaaS provider that’s being swiped on a credit card. So it’s there, and the way that enterprises are dealing with it is they have separate app, dev, ops, sec networking teams for every one of these stacks, which is pretty much pandemonium and is unsustainable. You talk a lot about cost, cost drift, and the optimization for certain elements of workload. So the question I have for you is, what is Dell doing to help with this challenge? I think it’s a good place to be. We’re at this mature phase of the cloud. What are you doing to help your customers out in this situation?
Adam Glick: At Dell, we built the APEX portfolio, and that’s really there to help customers operate in a multi-cloud by design environment to help them solve some of these challenges. So it’s a way that they can utilize their existing skillsets regardless of the location of the application. So when I say location, whichever the major hyperscaler public clouds you’re looking at or on-prem, out to the edge. Effectively, what we’re doing is we’re putting power back in the hands of IT and giving them choice as to where they want to operate a workload as well as easing the challenges of moving between those locations, so they maintain that optionality. It helps them avoid lock-in to a particular location and also helps avoid skills gaps or retraining that needs to happen that can make their organizations less agile than they want to be. When our customers have that kind of power, they can identify what applications are best optimized for which location, and as the business requirements change, IT can change along with them. So I’ll give you a couple examples.
A few years ago, many organizations were really optimizing around ROI. That’s what we’re hearing, and growth was really the big driver they were looking at, how do they expand, how they grow. Economy was doing great. And in that instance, one of our customers, Trintech, they were thrilled that we were able to help them stand up new disaster recovery operations in a public cloud, and we could do that in less than a week for them. And so they got it up and running really fast. That speed on that was super important to what they were doing. In that case, they were looking at the fallout of decisions that were made with Brexit and how do they be able to help that with their expanding operations.
These days, when we’re talking to customers, we’re hearing a lot more about TCO, and cost consciousness seems to be a lot more top of mind. Another example on that side of things is we were helping a company called 37signals. They’re moving into a colo, moving out of a public cloud on that, and they estimate they’re going to save about 60% on infrastructure costs doing that.
So organizations that can adapt quickly, those are the folks that are outperforming and outmaneuvering their competitors. So when they find that, they realize that if they optimize for one location and they don’t have that flexibility, they don’t have a multi-cloud by design and the ability to move things around, their advantage essentially turns into technical debt when the business requirements change. We see both sides. It’s why we take that multi-cloud by design approach to make it simpler for our customers, help them take control back of their infrastructure, and be more agile in how they serve their organizations.
Daniel Newman: Yeah, I think you brought up a lot of great points. I think there’s a little bit of an opportunity here for you. Patrick and I, as industry analysts, have spent a lot of time working closely alongside Dell through the journey of APEX. It’s had a few iterations. It seems like it’s really landed now. It’s founded its footing. You’re seeing the service portfolio expand a lot, but I think this is something that’s still relatively in its infancy in terms of the potential for Dell. The way I see it is the understanding of the need to be hybrid multi is becoming really well-embedded. You mentioned 37signals, they’ve been kind of one of the poster child companies right now for that repatriation, a company that really came out and didn’t only come out and make some sort of claim like, “Ooh, we’re going back on-prem,” but said, “Let us show you the calculus of how we got here,” and I think that calculus tells a really favorable story for what Dell is doing with APEX.
Having said that, I think one of the biggest challenges that I’d love to get your feedback on is how does Dell address the services gap. So the services gap, I’ll call it, is the fact that public cloud providers have built these massive service portfolios that a lot of these sort of consumption-based services that are being delivered, like APEX, have taken some time to expand out. So talk a little bit about that, how you’re approaching building out the portfolio, expanding services, and making sure that people that start to want to do exactly what 37signals is doing can do it and don’t miss a beat in terms of their ability to continue on delivering all the services their enterprise needs.
Adam Glick: Sure. So one thing that’s important to not overstate, the public clouds have a tremendous number of services that are out there, most of them built off of open-source software, but some that are proprietary. And those things that are out there, if you take a look at what people are actually buying, what people are mostly buying, where most of the revenue comes from is still core infrastructure pieces. And I think there can be many reasons for that. One of the most obvious ones is just those are the things people are most familiar with. They don’t need as much skillsets to know those particulars, those pieces versus core infrastructure, like VMs or storage they might be familiar with, but also, it provides optionality that I remember in a previous life working on these things and there were customers of, “Hey, I want these core building blocks because that’s going to enable me that if I need to move, if I want to be able to have that design where I can move things around, I’m not locked into particular pieces.”
That said, there’s certainly things that are provided as a service and that help out with those pieces, and as we look at what happens with those, we have a great opportunity and we provide that through two means. One is through our own professional services that we help, and two is the incredible partner network that we have, that if I take a look at the example I gave earlier and a lot of others, you take a look at actually both examples that I mentioned, like they’re working with partners and they say, “Okay. Let’s say that I want this to be managed for me.” Well, great. There are great partners and Dell services people that will go do that, too.
So if you want the infrastructure and you want to be able to have that in a modern consumption way, excellent, we can do that. You want to be able to actually have that fully managed for you and you want to have organizations that are running it for you, say you want to move things like 37signals that we talked about, they’re actually moving things into a colo. They’re taking their materials, they’re putting it in a colo, they’re working with a partner, it’s going to manage it for them. They’re still not touching servers, they’re still having that hands-off experience where they just sit remotely using keyboards and be able to work with those pieces. It still ends up providing them everything that they need, and in their case, they’ve been very focused on the cost piece. They’ve talked also about the performance benefits that they’ve gotten from that. But they really started their journey as a cost journey.
And so the reality is, a lot of these things have been available before of like there are partners out there that help people do them depending on if it’s something they want to manage in-house, they want to do themselves, or hand it off to a partner and be able to use a trusted partner. They have to be able to deliver that. And so you can do either of those, and that’s where you see people who still want to have that managed as a service experience can get that in whatever the location is that’s most useful for them.
Patrick Moorhead: Yeah, I’m really glad to hear the company’s focus on multi-cloud and what it’s doing with APEX. It is the way that IT is going to go. First of all, we never had the right application transport like we have today. I like to call them them fabrics, which are hybrid multi-cloud fabrics, like Dell Backup Service that can be used across the hybrid multi-cloud regardless of where it’s at. That’s what enterprises are looking for. So with that, what can we expect to hear more about in the future? If you want to spill all the news before Dell Tech World on here, go right ahead. But maybe give us a little bit of a teaser.
Adam Glick: Well, as you mentioned, Dell Technologies World is coming up very soon, and we are looking forward to sharing a lot of really exciting news there. I personally just can’t wait for the moment. As you can imagine, we have a lot to talk about, and a lot of that is going to be APEX-related, what we’re doing to make multi-cloud by design something that every customer can take advantage of and how Dell and our partners are going to be able to bring that to customers. So I can’t share too much here. I don’t want to be able to break that. What I can say is I think your viewers and you folks will really love what you see at Dell Technologies World, and I encourage you to tune in and take a look at what happens there because you’re going to see so much happening, especially in this space and what we can do to help make sure that everyone can benefit from a multi-cloud by design world.
Daniel Newman: So if I press you, then you’ll tell us more, the audience? No? No? Okay. I was just checking.
In serious, though, Pat, I don’t know about you, but I am excited. We’re going to be at Dell Tech World, both Patrick and I in our capacity as CEOs of our analyst firms, but also doing a bunch more work with Dell on Six Five videos. So we’re going to be talking to a lot of the leadership experts and we’re going to be given the play by play of what our analysis is of it. But Adam, I do want to say the trajectory is really good, the landscape is really encouraging, and the growth that’s taken place during a very difficult macroeconomic period, in my opinion, is indicative of the fact that you’re getting the alignment right for the long term, and over the long term, I think this subscription-based consumption hybrid multi approach is going to be the winning architecture. I’ve been on the record, documented many times saying this, the overall market will grow, public cloud will keep growing, but these kinds of solutions are going to be where enterprises ultimately land.
So I want to thank you so much, Adam, for joining us here on this Six Five Insider. I know you’ve been with us before, and I hope in the near future, you’ll be with us again.
Adam Glick: Yep. I look forward to connecting with you both at Dell Tech World, where we can talk a lot more about all the big announcements we had. But Dan, Patrick, thank you so much for the time. It’s really been a pleasure.
Daniel Newman: All right, everybody, you had it here, you heard it first. Patrick and I will be on the ground at DTW talking more about multi-cloud, but for this episode of The Six Five, we got to say goodbye. Hit that subscribe button, join us for all of our great interviews on the Insider edition. Was this one the best? You tell us. But for now, we got to go. See y’all later.