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>> Hey everyone, good afternoon
and welcome back to theCUBE's day one coverage
of HPE Discover 2023,
live from Las Vegas at the Venetian Expo.
Lisa Martin here with Dave Vellante.
We are here for three full days.
Dave, a lot of coverage.
We've talked a lot about AI.
We're going to talk a lot about AI and Edge,
but one of the most important topics
as well is sustainability.
Customers are,
you know, need to work with organizations
that have clear sustainability goals and targets
and can help customers achieve the same.
>> Well, you know, AI is not only a hot topic
it generates a lot of heat.
>> It's hot. >> Yeah.
>> It's hot, hot.
We're going to be having a great conversation
about digital transformation,
sustainability, how they can be integrated.
We've got one of our alumni back,
Dr. John Frey is here,
Chief Technologist, Sustainable Transformation at HPE.
And, Monica Batchelder joins us as well,
Chief Sustainability Officer at HPE.
Welcome to the program.
Great to have you guys.
>> Thanks for having us.
>> Thanks, it's great to be here.
>> Monica, talk about,
you know, as Dave said,
AI is hot and it's actually hot.
From a sustainability perspective,
what are some of the common current customer challenges
that they're coming to HPE, saying,
"We need help to dial this down,
so we can, you know, be carbon neutral
by certain number of years."
>> Exactly, so as you mentioned,
our customers have these really
ambitious sustainability goals
and what we're seeing is those requirements
are starting to trickle down to the IT organizations.
So CIOs are now being held accountable
for environmental KPIs.
Some of the gaps they have
is they often don't really have the expertise
and the skills in their organization to develop
and deliver on those strategies
and they don't have the data
and the solutions to actually take action
and remove their emissions.
And so we're offering them
a breadth of different opportunities from data
and visibility through to our expertise
with our consulting services
through to actually more low carbon offerings
that we can give them.
>> John, can you comment on some of the technology challenges
that customers are facing,
kind of align with what Monica's saying?
This is what they're coming to us.
What are some of the under the hood tech challenges
that they're saying, "Guys, we got to resolve this."
>> Yeah, it's a great question
and that it's actually multifactorial.
In many cases, they're starting at the hardware
and then trying to build up a solution
which isn't the most efficient way.
In another sense,
we know from data center surveys across the globe
that only about half of them have any analytics
to look at utilization levels,
power consumption, thermal generation.
So if you don't have those analytics
it's really hard to optimize.
Or if you make a change,
it's really hard to see the impact of the change as well.
>> So HPE has set goals,
I think, Antonio said, "Net zero by 2040."
So net zero means no carbon emitted, correct?
Versus that's different from carbon neutral
which means you offset, right?
So what are the,
first of all, do you even know how you're going to do that?
(David chuckling)
That's,
right, net zero?
I'm curious as to what the path is to get there.
I imagine it's a little fuzzy.
>> Yeah. >> Parts of it anyway.
And then, even getting to carbon neutral,
what are the paths that people are taking
that you recommend?
>> So what net zero essentially means is that,
across what we emit
and then what we eventually will need
to draw out of the atmosphere,
that's going to net out to zero.
So it's not that we're going to reduce emissions to zero
that is essentially impossible,
but we'll actually need to start drawing carbon out
of the atmosphere at some point here
to get to our 2040 target.
And so, really what we're seeing is,
for HPE, almost all of our carbon footprint
is actually generated outside of our direct control.
So it's about two thirds customers use of our products
and about one third from the supply chain.
So that means that the only way
that HPE can make progress towards our own goals
is to partner across the entire value chain.
So we need to work with our suppliers
to set their own targets
and make progress towards them.
We need to deliver more sustainable offerings
to our customers to help them bring that down
and then our own operations.
In the last two years,
we've reduced our own operational emissions by more than 20%
and we exceeded our target three years ahead of schedule
to source 50% renewable energy.
So we're making a lot of progress
in our own direct operations,
but there's a lot more we need to do,
upstream and downstream.
>> So the manufacturing of your products,
as you said, like, roughly one third
and the two thirds is your partner.
So you got to partner with them,
they have to get sort of aligned,
but as well the technologies that you create can help them.
Is that the right way to understand it?
>> Yeah, absolutely.
And so when we work with customers,
we really help them think about
a variety of ways to optimize.
First, looking at all of their solutions, saying,
"Do you even need these solutions?"
And in some cases,
we have both hardware and applications
in their infrastructure they don't even need.
And then over 22 years of working with customers
to drive these efficiencies,
we've come up with five levers,
five key areas of focus for them,
equipment efficiency,
get the most amount of work from a piece of equipment,
energy efficiency, get the most work per watt of power,
resource efficiency,
which is minimize the amount of cooling,
power conversion, people that it takes to run the solution,
software efficiency, which is look at your workloads,
make sure the code is most efficient,
the programming language is most efficient,
the workload is designed to run on the hardware
that it's running on top of
and can take full advantage of it.
And finally, data efficiency.
We knew that our customers collect a lot of data.
In fact, they're data hoarders,
but they don't use all of that data.
So how do they think in a different way before they develop
a business application about the data they need
in the first place,
collect only that data,
so they get value from all of it,
and then it make better storage decisions
and data destruction decisions
where they no longer need the data.
So we find that when customers do those five things,
they can make dramatic improvements in IT efficiency.
>> It sounds like,
sustainability being integrated or woven
into digital transformation strategy
from a customer is really the way to go.
>> Yeah, absolutely.
And you can't optimize,
from a sustainability perspective,
in isolation either.
You've still got to consider resiliency factors,
latency issues, cybersecurity issues,
but you need to have sustainable IT
as part of your overarching strategy.
And so many customers have said they don't have that.
So one of the things we did a couple years ago
is developed a customer workbook called
"Six Steps for Developing a Sustainable IT Strategy,"
to walk them through step-by-step how to do that,
because we know when they implement
a sustainable IT strategy as part of digital transformation,
they tend to outperform their market,
they tend to have better results,
and frankly, it optimizes their technology infrastructure
all the way through.
>> Lisa: Significant benefits.
>> I remember back, like, 2006, 2007,
there was the big green IT movement
and the CIOs didn't pay the power bill,
so they didn't care.
>> That's right. >> Yeah, and so,
now it's changed, right?
Everybody has, you know, ESG objectives.
You're saying, the CIOs are being held accountable.
How are they responding to that?
How are they working with facilities
and other parts of the organization,
folks with roles like yourself
that exist within those organizations?
It's a complete mindset change, isn't it?
>> Yeah, and a lot of people don't recognize
that the IT operations can actually be a huge component
of operational energy costs, as you said,
and of operational carbon emissions,
especially for really large enterprises.
But reducing carbon equates with efficiency, right?
And that equates with optimizing and reducing costs.
So what we're really seeing among our CIO community
is the shift in mindset.
They're rethinking sustainability
from being sort of a cost center
as it was considered in the past
to actually being an enabler of their business goals
and their digital transformations as well.
>> The key and,
were that you just mentioned, Monica, is enabler.
And you mentioned the workbook,
'cause I was wondering,
with the two thirds that you said,
two thirds in terms of energy emissions
and things is out of HPE's control,
you have to work with the ecosystem
of customers and partners.
How important is awareness?
I imagine it's absolutely critical these days
for customers to really fully be aware
of what sustainable IT means
and what it can deliver to a business.
>> Absolutely, that's what John's team does every day
so I can let him speak to that one.
>> Yeah, it is,
and some customers we don't have to make aware.
With the war in the Ukraine, for example,
our European customers saw their power bills double
or triple almost overnight.
They were acutely aware they needed
to take further actions. >> They can set-
>> Other customers have made brand commitments
to their customers,
or their customers are requiring them to take certain steps.
But the other thing that you find happening
is boards are now asking questions of CIOs and CEOs.
Customers are asking those questions,
institutional investors.
Monica spends a lot of time with our investors,
helping them understand why we take the strong measures
that we do and the business value.
And that's the key.
Sustainability, historically,
was viewed as a reputational item.
It's absolutely a revenue driving opportunity.
It's a cost savings opportunity,
it's a business efficiency opportunity.
So what we find in our varied customers around the world,
one or more of those aspects bring this
to the forefront in their minds.
>> So I asked earlier,
do you even know how you're going to get to net zero by 2040?
And I think you gave a good answer,
as you, first of all, you got to work with your ecosystem.
You got stuffs that you,
you control a third,
two thirds is sort of not completely outside
of your control, but you got to have partnerships to do that.
My question is, are those five vectors
that John mentioned,
the path to get there,
and how do you think about
the countervailing effects of GPUs
and AI sort of offsetting?
It's like every time we get a new iPhone
it runs faster, but there's more data on it,
so you don't notice kind of thing.
>> Yeah, so we believe those are the right five levers
and they're very in intensity for each customer
and they apply, by the way,
from the public cloud all the way to the Edge.
So we think those are the right five things.
And as we get increasing use of accelerators
and higher core count processors,
they're even more important.
So for example, we'll find customer workloads
that can use one core running on a piece of hardware
with a GPU and a 64 core processor in it,
that's really inefficient.
So the situation's going to get more critical
that we take these five levers,
and then we're even encouraging customers
on both ends of that spectrum.
One is, if they're going to use renewable energy
and we know their renewable energy generation
is not constant all hours of the day
and all days of the week,
based on climate conditions and things.
So we can move workloads around actually
and run them when we have a higher intensity
of renewable generation on the front end.
On the back end, the number one waste in technology is heat.
>> Yeah. >> And historically,
we've just thrown it back to the atmosphere
to get rid of it.
Well, actually there's value in heat
and so we have customers,
particularly in Europe,
that are saying, "Let's recover that waste heat."
And in fact, if we need to make it a little higher
we can tweak some settings in the IT infrastructure
to generate a little more heat,
particularly where we have liquid cooling
and then we can sell that heat as a product,
either for district heating,
sustainable aquaculture,
greenhouses or various things like that.
So all of a sudden, we're taking what was a waste
and now making it saleable revenue product.
>> And that visibility for organizations is critical
that they didn't have before.
I'm curious, you mentioned the workbook.
I imagine you talk with a lot of investors
as John was saying.
What about customers from like,
a customer committee perspective to,
did you work with customers to develop those five levers
that you talked about?
How are they involved in helping HPE get to net zero?
Like, they was saying, "How are you going to get there?"
>> Yeah, absolutely, we take feedback from customers.
We actually update those workbooks,
probably about every two years to make sure they're current.
We ask customers for feedback.
We ask them for what other white papers
and resources they want from us
to be able to make an impact.
And then we're actually embedding
it across our offerings too.
So John mentioned renewable energy.
One of the things we're announcing here is HPE GreenLake
for large language models
that's actually going to be run on,
in co-location centers that have nearly
a hundred percent renewable energy.
So yes, we have to offer them more sustainable solutions,
but how that IT is powered is just as important.
>> I saw a stat in one of the slides.
I think it,
locating it in a facility that has 290 days
of essentially winter weather, right?
So, you know, it's pretty cool.
So you can use ambient air, right?
I'm still trying to get my head around how you sell heat.
(David chuckling) (Lisa chuckling)
What do you have to heat the heat
to make sure it doesn't lose heat thermodynamics?
But (chuckling) so how does that work?
Is it a pipeline?
That's amazing.
>> Yeah, it is, and I'll give you
a real-life customer example.
So, Danfoss is a big customer of HPEs.
They were a early GreenLake customer,
and, in fact, their data center sits in a,
in essence, a shipping container.
We call it a "Performance Optimized Data Center."
So it's on a gravel pad,
out by their headquarters
with some of their manufacturing facilities nearby.
The IT is all liquid-cooled,
so that liquid cooling loop,
and when we say liquid-cooled,
we really mean almost 30 degree water or even higher.
So by the time it comes out of the IT stack,
it's even warmer than that.
Well, they're co-located with a village
that has district heating.
So much like other utilities
there's a heating grid that goes through the entire village.
So they actually take that warm liquid coming off
the IT stack extract the heat,
that's one of the businesses they're in,
is these heat pumps that extract that heat
and provide that as a saleable product to the district.
So they provide the heating
for that whole village around their corporate headquarters.
>> David: That's so clever.
>> And increasingly, there's more and more opportunities
to do that around the world.
And so what we love about that relationship is,
Danfoss has come to HPE
and added this whole perspective around heat reuse.
They build the technologies to do that and partner with us
in the same way they leverage
HPE sustainable technology solutions like HPE GreenLake,
many of our professional services.
So it's a great symbiotic relationship
that turned into new market opportunities
for both companies.
>> That was a word that just popped into my mind
is symbiosis.
>> Yes. >> Fantastic.
Monica, lead us out here with some of the key future trends
that you're thinking as Dave was talking about,
you know, with the emergence of AI,
large language models announcement this morning,
AI as a service.
I think, Antonio even said something like,
and I've heard this from other leaders before,
"If you're not already using AI in your business,
you're already behind."
So what are some of the future trends that you are seeing
that HPE, from a sustainability lens,
can help its customers tackle?
>> Yeah, so if you think about customers growing demand
for compute resources,
that makes sustainability all the more important, right?
As you scale that IT,
you're going to hit constraints like power,
space, cooling.
And so you really need to be developing
a sustainable IT strategy that's holistic.
You know, a lot of our customers are taking actions.
They're doing a few things.
Very few have a holistic IT strategy
that looks across their,
you know Edge to cloud, hybrid IT, multi-vendor estate.
And so we're really focused on helping them,
give them solutions to help them manage that bigger picture.
>> Yep, and it's all about that visibility
to have that bigger picture as you talked about.
Sustainable IT is now such
an important component to businesses.
It's a board level conversation
for every business and every industry.
John, Monica, thank you so much
for joining Dave and me on the program,
talking about what HPE is doing
from a corporate perspective,
from a technology perspective,
and how you're really being symbiotic
with customers and partners.
We appreciate your time.
>> Thanks for having us. >> Thanks guys.
>> Thanks. >> Our pleasure.
For our guests, and Dave Vellante,
I'm Lisa Martin.
What's up next, you ask?
Brandon Whitelaw of Qumulo
is going to be here talking about industry position,
HPE partnership,
and why scale anywhere is the new thing.
Stick around, we'll be right back.
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