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>> The Cube's coverage of Red Hat Summit, 2022.
The Cube has been covering Red Hat summit
for a number of years.
Of course, the last two years were virtual coverage.
Now the Red Hat Summit
is one of the industry's most premier events
and typically Red Hat Summits
are many thousands of people.
I think the last one I went to was eight or 9,000 people.
Very heavy developer conference.
This year, Red Hat has taken a different approach.
It's a hybrid event.
It's kind of a VIP event at the Weston and Boston
with a lot more executives here
than we would normally expect versus developers,
but a huge virtual audience.
My name is Dave Vellante,
I'm here with my co-host Paul Gillin.
Paul, this is a location
that you and I have broadcast from many times.
And of course, 2019, the summer of 2019,
IBM acquired Red Hat.
And of course, we did Red Hat Summit that year
but now we're seeing a completely new Red Hat
and a new IBM.
>> And you wouldn't know IBM owned Red Hat
for what they've been talking about at this conference.
We just came out of the keynote
where in the in the hour-long keynote,
IBM was not mentioned once
and only appeared, the logo, only appeared once
on the screen in fact.
So this is very much Red Hat being Red Hat,
not being a subsidiary to IBM.
And perhaps that's justified
given that IBM's track record with acquisitions
is that they gradually envelop the acquired company
and and it becomes part of the IBM board.
>> Yeah, they blue wash the whole thing, right?
And it's ironic because IBM think
is going on right across the street.
Arvind Krishna is here, but no presence here.
And I think that's by design, I mean.
It reminds me of when, you know, EMC owned VMware.
You know, the VMware team didn't want to publicize that.
They had an ecosystem of partners
that they wanted to cater to
and they wanted to treat everybody equally,
even though perhaps behind the scenes,
they were forced to do certain things
that they might not have necessarily wanted to
because they were owned by another company.
And I think that, you know, certainly IBM's done a good job
of leaving the brand separate.
But when they talk about the conference calls,
IBM's earnings calls,
you certainly get a heavy dose of Red Hat.
When Red Hat was acquired IBM
it was just north of $3 billion in revenue.
Obviously IBM paid $34 billion for the company.
Actually by today's valuations, probably a bargain,
despite the market selloff in the last several months.
But now we've heard public statements
from Arvind Krishna that Red Hat
is a $5 billion plus revenue company.
It's a little unclear what's in there.
Of cou^rse, when you listen to IBM earnings,
you know consulting is their big business.
Red Hat's growing at 21%.
But when I remember, Paul, when Red Hat was acquired
Stu Miniman and I did a session and I said,
this is not about Cloud.
This is about consulting and modernizing applications.
And sure there's some cloud in there with OpenShift,
but from a financial standpoint,
IBM was able to take Red Hat and jam it right
into its application modernization initiatives.
So it's hard to tell how much of that $5 billion
is actually, you know legacy Red Hat,
but I guess it doesn't matter anymore.
It's working.
>> IBM mathematics is notoriously opaque.
If the business isn't going well,
it'll tend to be absorbed into another number
in the earnings report that does show some growth.
So we've heard certainly, IBM talks a lot about Red Hat
on its earnings calls.
It's very clear that Red Hat
is the growth engine within IBM.
I'd say it's a bit of the tail wagging the dog right now
where Red Hat really is dictating where IBM goes
with its hybrid Cloud strategy,
which is the foundation not only of its technology portfolio
but of its consulting business.
And so Red Hat is really in the driver's seat
of Hybrid Cloud and that's the future for IBM.
And you see that very much at this conference
where Red Hat is putting out
its series of announcements today
about improvements to its Hybrid Cloud,
the new release of REL 9, Red Hat Enterprise Linux 9,
improvements to its hybrid cloud portfolio.
It very much is going its own way with that.
And I sense that IBM is going to go along
with wherever Red Hat chooses to go.
>> Yeah, I think you're absolutely right.
By the way, if you go to SiliconANGLE.com,
Paul just published a piece on Red Hat.
Red Hats, the roll out their parade,
which of course is as you pointed out,
led by an Enterprise Linux.
But to your point about Hybrid Cloud,
it is the linchpin of certainly IBM strategy
but many companies Hybrid Cloud strategies.
If you think about it, OpenShift in particular,
it's the modern application development environment
for Kubernetes, you can get Kubernetes.
You can buy EKS, you can get that for free
in a lot of places.
But you have to do dozens and dozens of things
and acquire dozens of services to do what OpenShift does
to get the reliability, the recoverability, the security.
And that's really Red Hat's play.
And the thing about Red Hat combining with Linux,
their Linux heritage, they're doing that everywhere.
It's going to OpenShift everywhere, Red Hat everywhere.
Whether it's OnPrem in AWS, Azure, Google, out to the Edge.
you heard Paul Cormier today saying he expects
that in the next several years,
hardware is going to become one of the most important factors.
I agree, I think we're going to enter a hardware renaissance.
You've seen the work that we've done on Arm.
I think 2017 was when Red Hat and Arm
announced kind of their initial collaboration,
could have even been before that.
Today we're hearing a lot about Intel and Nvidia.
And so affinity with all of these alternative processes,
I think they did throw in today in the keynote, Power
and see-- >> Yeah, he did.
I think I heard that.
>> That was the other IBM branding,
they sort of tucked that in there.
But the point is Red Hat runs everywhere.
So it's fundamental to building out Hybrid Cloud.
And that is fundamental to a lot of companies strategies.
>> And Red Hat has been all over Kubernetes with OpenShift.
It's a drum beat.
Here, the OpenShift strategy
is what really makes Hybrid Cloud possible.
Because Kubernetes is what makes it possible
to shift workloads seamlessly from platform to platform.
You make an interesting point about hardware,
we have seen kind of a renaissance in hardware
these last couple of years.
As these specific chipsets
and even full scale processors have come to market,
we're seeing several in the AI area right now
where startups are developing full blown chipsets
and systems just for AI processing.
And in video, of course,
that's really kind of their stock and trade these days.
So a company that can run across
all of those different platforms.
A platform like, like REL
which can run all across those different platforms
is going to have a leg up on anybody else.
>> And the implications for application development
are considerable when you think about,
we talk about a lot about these alternative processes.
When flash replaced the spinning disc
that had a huge impact on how applications are developed.
Developers now didn't have to wait for that disk to spin,
even though it was spinning very fast,
it's mechanical compared to electrons, forget it.
And the second big piece here
is how memory is actually utilized.
The X86, you know, traditional X86,
you know memory, everything goes through
that core processor.
Intel for years grabbed more and more function.
And you're seeing now that function become dispersed.
In fact, a lot of people think we're moving
from a processor centric world to a connect centric world.
Meaning connecting all these peace parts.
Alternative processors, memory controllers,
storage controllers, IO, and network interface cards,
SmartNICs, and things like that.
Where the communication across those resources
is now where a lot of the innovation is going.
You're seeing a lot of that.
And now of course, applications can take advantage of that,
especially now at the Edge,
which is just a whole new frontier.
>> the Edge certainly is part of that equation.
When you look at machine learning,
training machine learning models,
the CPU actually does relatively little work.
Most of it is happening in the GPUs
and these parallel processes that are going on.
And the CPU is kind of acting as a traffic cop.
And you see that in the Edge as well.
It's the same model at the Edge
where more of the intelligence
is going to be out in discrete devices,
spread across the network.
And the CPU is going to be less of engine intelligence.
At the same time though,
we've got a hundred Core CPUs are on the horizon.
And there are even 200 and 300 Core CPUs
that we may see in the next couple of years.
So CPUs aren't standing still,
they are evolving to become
really kind of super traffic cops
for all of these other processors out in the network
and on the Edge.
So it's a very exciting time to be in hardware
because so much innovation is happening really
at the microprocessor level.
>> Well, we saw this, you and I live through the PC era,
and we saw a whole raft of applications come about
as a result of the microprocessor,
the shift to the microprocessor based economy.
We are seeing something similar with mobile and the Edge.
Yeah, just think about some of the numbers.
If you think about the traditional Moore's law
doubling a number of transistors every,
let's call it two years, 18 to 24 months.
Pat Gelsinger at Intel promises
that Intel is on that pace still.
But if you look at the Apple M1 ultra,
they increased the transistor density 6X
in the last 15 months.
Okay, so whereas, another data point
is the historical Moore's law curve is 40%,
that's moderating to somewhere down in the low 30s.
If you look at the Apple A series,
I mean, that thing is on average increasing performance
at 110% a year.
When you add up into the combinatorial factors of the CPU,
the neural processing unit, the GPU, all the accelerators.
So we are seeing a new era.
The thing I wanted to bring up Paul is,
you mentioned AI.
Much of the AI work that's done today
is modeling that's done in the Cloud.
And when we talk about Edge,
we think that the future of AI is,
AI inferencing in real time at the Edge.
So you may not even be persisting that data
but you're going to create a lot of data.
You're going to be operating on that data in streams.
And it's going to require a whole new architectural thinking
of hardware.
Very low cost, very low power, very high performance
to drive all that intelligence at the Edge.
And a lot of that data is going to stay at the Edge.
And we're going to talk about some of that today
with some of the EV innovations, and the vehicle innovations
and the intelligence in these vehicles.
>> Yeah, and in talking in its Edge's strategy,
which it outlined today.
And in the announcements that have made today,
Red Hat very much playing to the importance
of being able to run Red Hat Enterprise Linux.
At the Edge, the idea is,
you do these big machine learning models centrally,
and then you take what results from that
and you move it out to smaller processors.
It's the only way we can cope with the explosion of data
that these sensors and other devices will be generating.
>> So some of the themes we're hearing
in the announcements today that you wrote about Paul,
obviously REL 9 is huge,
Red Hat Enterprise Linux version nine.
New capabilities, a lot of edge, a lot of security,
new cross portfolio capabilities for the Edge,
security and the software supply chain
is a big conversation especially post solar winds.
Managed Ansible.
When you think about Red Hat,
you really, I think anyway about three things,
REL, which is just Linux, it powers the internet,
powers everything.
You think of OpenShift, which is application development.
You think about Ansible, which is automation.
So IT Ops.
So that's one of the announcements, Ansible on Azure.
And then a lot of Hybrid Cloud talk.
And you're going to hear a lot of talk this week
about Red Hat's Cloud services portfolio,
packaging Red Hat as services, as managed services.
That's, you know, a much more popular delivery mechanism
with clients because they're trying to make it easy.
>> And this is complicated stuff.
And it gets more complicated the more features they add,
and the more components the Red Hat portfolio are available.
It's getting to be complex to build these Hybrid Clouds.
>> So like many of these,
so the Cube started doing physical events last summer,
by the way.
And so this is new to a lot of people.
They're here for the first time,
people are really excited.
We've definitely noticed the trend
people are excited to be back together.
Paul Cormier talked about that.
He talked about the new normal.
You can define the new normal anyway you want.
So Paul Cormier gave the intro keynote,
Ashas Badani interviewed Amex,
Stephanie Chis interviewed Accenture.
Both those firms are coming on,
Stephanie's coming on with it and Accenture as well.
Matt Hicks talked about product innovation.
I loved his reference to Ada Lovelace.
That was very cool.
He talked about Serena Vaster, Ramin Arjan,
famous mathematician who nobody knew about
when he was just a kid.
These were ignored individuals in the 1800
for years and years and years,
in the case of Ada Lovelace for a century even.
He asked the question what if we had discovered them earlier
and acted on them and been able to iterate on them earlier?
And his point tied that to open source,
very brilliantly I thought.
And keynotes, which I appreciate are much shorter--
>> Much shorter, much more intimate.
They did a keynote in the round this time
which I haven't seen before.
There's maybe a thousand people in there.
So a much smaller group, much more intimate setting.
Not a lot of back and forth
but there there is a feeling
of a more personal feel to this event
than I've seen at past Red Hat Summits.
>> Yeah And I think that's a trend
that we're going to see more of where the live audience
is kind of the, on the ground,
it's kind of the VIP audience
but still catering to the virtual audience.
You don't want to lose them.
So that's why the keynotes are a lot tighter.
Okay, Paul, thank you for setting up Red Hat Summit, 2022.
You're watching the Cubes Coverage.
We'll be right back wall to wall coverage
for two days right after this short break.
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