Why Your IT Puts Your Patients at Risk

TDD EP47 - Guest: Dustin Young

[00:00:00] Max Clark: I was saying I with some friends last night, I told him I'm planning, training, planning the summer, you know, and he's like, oh, are you a planner? I'm like, I never really thought I was until I had two kids. And then like, if I don't do it, nobody does it. And then I'm the, you know, and then it doesn't happen.

And then like, and I hate doing stuff last minute where it's like you don't have options. You know, there's something about like. Oh, let's go do something. And it's like, well, if we had decided to do that six weeks ago, it would've been really easy for us to do it. But now it's really hard for us to do it.

I mean, that makes me crazy. So

[00:00:37] Dustin Young (EVP At Enzu): and your kids are still pretty young, right?

[00:00:40] Max Clark: six and eight.

[00:00:42] Dustin Young (EVP At Enzu): Yeah.

[00:00:44] Max Clark: Okay, so gimme the, gimme the story arc high level here.

[00:00:48] Dustin Young (EVP At Enzu): All right, so we're gonna, so we have a. Regional Healthcare Center. Um, they are, [00:01:00] about 400 employees. Um, so they're bigger than the last one we discussed. Uh, they have a, for the size, they have two people in it, so actually less people in it, uh, with a larger. They have a bunch of clinics, so they, they don't just have their hospitals, they have a bunch of regional clinics. Um, and they are, are currently people who got their, you know, they paid for their one year renewal, which is common now. And they got their newest renewal to go to VMware. And that cost increase, um,

[00:01:43] Max Clark: That number. Just

[00:01:43] Dustin Young (EVP At Enzu): from.

[00:01:44] Max Clark: wait, let's, let's don't save it.

[00:01:47] Dustin Young (EVP At Enzu): Okay, so they've got that cost increase.

[00:01:50] Max Clark: So if they already migrated or are they talking about migrating?

[00:01:52] Dustin Young (EVP At Enzu): no, no, we're done.

[00:01:54] Max Clark: Okay, so they migrated.

[00:01:55] Dustin Young (EVP At Enzu): Right. Uh, and you're talking about, um, a old, older hardware stack. [00:02:00] Um, and then you know, the fear of coming off-prem, right? So what happens if we come off-prem?

[00:02:08] Max Clark: Okay.

[00:02:08] Dustin Young (EVP At Enzu): Um, what happens to our connections? They use a lot of outsource security. So how does that work? Um. You know, they, they are getting

[00:02:18] Max Clark: Okay.

[00:02:19] Dustin Young (EVP At Enzu): services too,

[00:02:20] Max Clark: We're we're, we're gonna, we're gonna do it live. We're gonna do it live. What an epic clip of like all time. I mean, just like, we're gonna do it live. Fuck.

Oh man. Simpler days, right? Simpler days. You can hear me okay? Correct. I'm trying to, I gotta like,

[00:02:44] Dustin Young (EVP At Enzu): I can hear you.

[00:02:45] Max Clark: I gotta like move everything around, but I don't want the space to be like dedicated solely to like a camera and a microphone.

[00:02:53] Dustin Young (EVP At Enzu): Yeah.

[00:02:54] Max Clark: at that point where like, you're like, Ugh, geez, do I have to actually just do it, you [00:03:00] know?

[00:03:01] Dustin Young (EVP At Enzu): Yeah. I actually have a dedicated space for the YouTube thing.

[00:03:07] Max Clark: How's it going?

[00:03:08] Dustin Young (EVP At Enzu): It monetized. I, I haven't had time to make a video for it in a year.

[00:03:12] Max Clark: your bikes, though.

[00:03:13] Dustin Young (EVP At Enzu): Huh.

[00:03:14] Max Clark: This is your bikes.

[00:03:16] Dustin Young (EVP At Enzu): Yeah, it sits there and makes money people, I mean, I have to answer questions probably every few days at least. I mean, it's just nonstop. It's uh, it's pretty wild. bikes and the vehicles and everything that goes with that whole

[00:03:29] Max Clark: That's cool.

[00:03:30] Dustin Young (EVP At Enzu): Yeah, it's pretty wild. it's actually, uh, I built a wall and everything and then, um, because I just use good microphones and a good camera, uh, it's just in the garage and it, you wouldn't notice.

[00:03:41] Max Clark: it works fine.

[00:03:42] Dustin Young (EVP At Enzu): Yeah.

[00:03:43] Max Clark: Um, high school friend of mine, um, he, uh, I mean like there was no intentionality behind it. He was just writing all the time, like. All the time was just riding. And he wasn't even like a social media guy. He was just like, occasionally would post like a photo of him, like [00:04:00] on some mountain, like, and he ended up getting sponsored by Santa Cruz and somebody else, like, here's a bike, post a photo of it occasionally, kind of thing.

And, and it like turned into this like totally random thing where he is not professional, he is not entering races, he's doing. He's mostly doing like what you would call like, um, you know, single track, right? But he is just like, just him going out and doing it, and he's, and it's just like, just turned into this kinda like, just totally random thing.

He doesn't even have huge, huge social media falling. Like the guy has no account. You know, like there's no, it was when he got, he got this bike and we were just, it was so completely random, like, how did this happen? Why

[00:04:41] Dustin Young (EVP At Enzu): Yeah, something hit, somebody saw it. Somebody liked something.

[00:04:49] Max Clark: Hi. I am, I'm stalling 'cause I'm trying to figure out how I wanna start this. Um,[00:05:00] 

we'll just do it live. Whatever.

[00:05:11] Dustin Young (EVP At Enzu): Yeah. And yeah.

[00:05:13] Max Clark: I, no, we're just gonna do it live. Okay. Ricks, we're starting, you know, this, this will be the beginning. This is the end. My only friend, the end. Um, you can see where my brain's at right now, right? Um,

I'm, I'm, I'm, I'm in such like a, a mental block right now. This will be fun. Um, alright, Dustin, we were talking the other day. And the conversation came up about, uh, Broadcom and VMware and migrations and with a lot of things in tech, there becomes this instant like run to, oh, something's happened. What does it mean?

You know? And then marketing departments get in and then you have like the fear cycle that kicks in and then there's like, nobody really knows anything that's happening, kicks in. Um, but it's been enough time since [00:06:00] acquisition now of VMware and, and we're starting to see real movement and real decisions being forced.

Like I, you know, and, and, um, uh, I, I think, I mean, let's just dive into it, right? So, you know, we were talk, you've got one recently, which was, and I, I think it very be, make more sense instead of me trying to regurgitate what you'd shared. If you just, you know, tell me like briefly, um, you know, you don't have, um.

Vertical industry like, like relative size, just just to help me be a little more focused with this.

[00:06:31] Dustin Young (EVP At Enzu): Yeah. So yeah, we are seeing a lot of change out there. Um, we're seeing a lot of companies testing softwares, um, because they are coming through the one year renewal cycle. this particular organization, uh, is healthcare, uh, would be classified as mid-market healthcare. You know, um, 400 ish employees, lots of clinics, some hospitals, small IT staff.

We're [00:07:00] seeing a lot of that, uh, out, out in space, especially in healthcare. Uh, they'll run on just a couple of, couple of IT staff, and the organization also, it's been five years with hardware, so they've got all these things going on. Um, and they are, they essentially were living in a buy time status and so. the question becomes where do they head, you know, what is the right, is the right alternative to their current VMware stack? Um, and, and there are a few things that drive it. I, there's some future looking things I think, that are driving some of the decisions, uh, for a lot of these organizations.

But then there's just purely cost, right? They're looking at cost and do they continue to manage things on the, on-prem? 'cause that is a, in the healthcare space on-prem is, is a big deal. They, there's still a good amount of that.

[00:07:51] Max Clark: The, okay, so separating fact from fiction, right? Broad Broadcom buys VMware. We know this [00:08:00] acquisition was going to be a play of increasing cost, and then there was a lot of push between. Is Broadcom gonna do a service provider strategy and try to force everybody through, you know, a, a, a distribution channel through through large ES or service providers?

Or are they gonna stick with enterprise and. And there's been a couple of stumbles and, and I, I'm, I think it'd be better if I ask you, you know, 'cause from your perspective as a service provider operating VMware with clients prior to this point, where is this shaking out right now? And, and what is Broadcom up to?

[00:08:35] Dustin Young (EVP At Enzu): So. You know, originally they took the top accounts, I think 2000 accounts and said they're direct period. We manage them from now on. Um, of those clients, so I I read recently, most if not all of those clients have already moved the subscription model. Um, because the complexity of their environments and the custom development, this is just, they're not gonna make major shifts. [00:09:00] Um. We've seen other providers that one provider built a specialty team to go after that enterprise market and it fell flat on its face because it's, it's hard to change all of that customization that's been done. Okay. then they, they pivoted and they hit the mid-market, realizing that that's the group that Broadcom is effectively, if you stay, you do, if you go great there, there seems to not be, there's not a focus from Broadcom on that group. And then any SMB stuff, there's no focus at all. And, and this was, I think, understood, uh, from the beginning. If you look at and you look at some other things that have happened over time, it's the, the historical pattern was there. Um, so mid-market, a lot of them signed a one year renewal or some probably a two, but a lot of 'em just signed the one year renewal. They got what seemed like a reasonable rate. So if you're talking about the people who are on-prem, right? So that first segment, [00:10:00] you saw a real reasonable rate and you saw them say, okay, I have time to work this out. Well, like all things in business, they're now against the clock again, because they didn't, a lot of 'em didn't work it out.

So we're seeing people up against the clock in that sort of frenzy, we expected to come back around.

[00:10:16] Max Clark: How much, I mean, you know, look, this is common in acquisitions, right? It's like buy, buy, buy an asset, real estate, tech, whatever it is, and increase the rates. Until you find the pain point where you start losing more customers and you're making money, right? Because there's usually a pricing imbalance that comes, you know, with a lot of legacy, you know, whatever asset base.

Okay, fine. So, you know, and, and it's, it's like there's this idea of like, is it, you know, boil the frog, right? It's like how much do you turn up? Is it shock? And a like, do you just go up crazy and, you know, and, and there's always, I I, I, I wonder, there's always like a point where the enterprise will just accept it.

You know, the enterprise will accept it. And then you go down into mid-market and SB and the, and you know, there's a point where [00:11:00] the mid-market and SB will just accept it as well because the switching costs and all the other things become too high. And, you know, originally it felt like Broadcom was going to, you know, it was coming in with shock and awe and it was like, oh, we're gonna double your rates.

And then it was back down and it came back up again. And, and where are you finding like price sensitivity in terms of people actually saying, we wanna do something different? I mean, there's, there's lots of like, I mean in your example here, I wanna get back into this, there's lots of different examples of like something different.

Something different can just be, we're gonna basically keep all of our infrastructure, but just move off of this platform, but stay on our infrastructure and, and continue as is. Or then there's like larger shifts, right? But

[00:11:39] Dustin Young (EVP At Enzu): Yeah.

[00:11:40] Max Clark: know, you know, 10% price increase, people probably just complain about it and swallow it 20%.

You know, it starts getting painful 30%. You're like, okay, now this is starting to get really interesting. And then, um, I. I'm curious what you're, what you're saying.

[00:11:52] Dustin Young (EVP At Enzu): they were for the mid-market, if they were between 10 and 30%, I think we wouldn't have the behavior we're

[00:11:58] Max Clark: Mm-hmm.

[00:11:58] Dustin Young (EVP At Enzu): lot of the mid-market we're [00:12:00] it, I mean, I, I mean, I get to actually see the, you know, the cost change. I mean, they talk about it as part of what they're up to. Um, uh, and. They're going from their renewal at 30, 30,000 to this year's renewal will be somewhere between 90 and 120,000. So they, they literally were left in space. But do they pay that

[00:12:26] Max Clark: me, I'm choking on air. Um.

[00:12:27] Dustin Young (EVP At Enzu): they afford it? Can they, did they do any, so the other thing, the mid-market doesn't have a lot of development. Right.

And I, their use of the tools is more limited. Right? They're, they're

[00:12:37] Max Clark: Hmm.

[00:12:37] Dustin Young (EVP At Enzu): doing everything they can to deliver the entire it stack with a small team across an ecosystem. isn't some dev team out there building apps on, on VMware. They're not using Native V. Most of 'em aren't even using any of VMware's like live migration and data protection tools.

I mean, they're, they're not using a lot of the features. So I, I, [00:13:00] it's a, like, it's like, uh, Microsoft moved to the bundles and all of a sudden Google grew quite a bit in their workspace. Right? It, it's that concept of, now you have to, you have to buy bundles, right? You have to buy subscription bundles, and they come with things.

Um, for the enterprise, they, they work, they got a lot, they got a big team. They can work this out and. They have to protect all of the things they've built. Where in the mid-market, it's really, you know, I just need a hypervisor. I need to make sure my operating system runs and I need to make sure my VMs deliver what they're supposed to deliver and that my ERP works.

And, you know, they, they're, they're not spending a lot of time, you know, deving containers while using VMware's, you know, platform and deving the architecture. It just doesn't exist.

[00:13:50] Max Clark: Yeah,

[00:13:51] Dustin Young (EVP At Enzu): Right. So, um, that's where this cost increase. That's where it hurts, uh, that

[00:13:58] Max Clark: well a

[00:13:58] Dustin Young (EVP At Enzu): group.

[00:13:59] Max Clark: a a [00:14:00] three to four X increase on your licensing costs in order to run your infrastructure.

[00:14:05] Dustin Young (EVP At Enzu): Yeah.

[00:14:07] Max Clark: and, and minimums have also increased drastically. I mean, VMware used to have these great little like,

[00:14:12] Dustin Young (EVP At Enzu): that's, that's the news this week.

[00:14:14] Max Clark: yeah, I mean, VMware used to have these great little intro packet, you know, bundles where it was like you could get, you know, two to three hosts and it was like massively discounted.

This was like the whole like, um, you know, a land and expand strategy where x percentage of customers would go and grow from there and become really good accounts for VMware. And then a lot of cases, a lot of people could run, you know, two and three hosts and, and be perfectly happy on the platform, and it worked great.

[00:14:39] Dustin Young (EVP At Enzu): Well that, I mean, you know, arrow whose memo went out to everybody they sell VMware licensing to. Right. So we're talking about a, a pretty significant disty. Um, it, I mean it made news all over this week and. The big thing that came with it was 16 corone 72 [00:15:00] core requirements. Um, Disney have a massive impact on the service provider space. Um, the, the service providers also got to sign like a one year renewal. So it'd be interesting to see how all that starts panning out they got to say, they got to say, Hey, we want this discounting to protect our current customers from so we don't have a big fallout. So they committed to revenue thresholds. uh, unless you haven't paid attention to Broadcom not being bothered by suing some pretty massive organizations when they're unhappy recently, you don't stand a chance. Um, if you didn't meet your revenue thresholds, you're being downgraded. And so that'll be an interesting fallout. Uh, uh, I don't know where that's going yet, but it's gonna exist.

Um, you know, uh, and so for these customers. Again, it, it goes back to they knew the market that they wanted. Um, they, [00:16:00] they knew where they were going, right? Um, they weren't trying to keep that small to mid market business.

[00:16:06] Max Clark: Uh, you know, the thing with this for me is, um, you know, two reflections. The first one is. Prior to this, VMware had, it felt like it had won the market. Right. You know, we went through phases where it was like OpenStack and cloud stack and um, you know, there were, there all these different, uh, orchestration platforms built on top of hypervisors that had come out.

And this was before containerization was really a thing. And, and, and a consideration on app. I mean all, and then there was enterprise focused or service provider focused, and all these different things were out there in the market. And, and there was a period, you know, 10, 10 years ago, ten-ish years ago, 10, 15 years ago, where they were all very vibrant in development.

And then, you know, I mean, if you, you know, if, if you were a service provider, we could argue whether or not vCloud was a great or a bad platform for you, but, you know, vCloud, you know, 'cause you could take [00:17:00] an enterprise off of vSphere on premise and, and bring them into vCloud and give them a lot of network, you know, automation, all these other things.

There was value there.

[00:17:07] Dustin Young (EVP At Enzu): Yeah.

[00:17:08] Max Clark: and it's, it's like now you kinda like, watch this play out and you're like, okay, so you're extracting more extracting, you're, you're receiving more revenue out of your customer base. Right. But, but if, if you kill the entire lower end market, now you have very little opportunity to sell upwards.

Right. Because, you know, it's, it's, it's interesting. It's gonna be interesting to see how this plays out in long term. I mean, I, I, I, I don't know, I don't wanna make any predictions here on this one because, you know, but, um.

[00:17:34] Dustin Young (EVP At Enzu): if they're gonna deliver a different, um, solution for service providers. that's gonna be their answer to is like, Hey, you guys can't touch the 2000 that we took home, but here's a product for you to go tackle that market. Um, uh, uh, a thinner product. Uh, you know, I don't know. I, I wonder how, 'cause if, if you're taking the top 2000 direct and then you tell people that their [00:18:00] entire licensing model just changed as a provider, and then this week you tell 'em, oh, it gets better than that.

Um, you know, you have to license all these cores per customer, because I, I can tell you like the, um, a previous customer we moved, um, couldn't have. It have enough course for just this decision. You know, they were a small cloud. This is a fairly, it was a fairly small cloud. It wasn't running a lot of things. And so it, it was, um, it would've, that would've impacted them heavily. So they, they effectively got lucky that they made the, the move, because I will tell you this, the, this customer will talk about, um, all of this stuff we discussed. Is pre this decision and while they have enough cores, it was still gonna impact their pricing even more than we already knew.

[00:18:54] Max Clark: Okay, so healthcare, you mentioned beforehand. Probably the last [00:19:00] stalwarts of people that want on-prem, like really

[00:19:02] Dustin Young (EVP At Enzu): Oh, yeah.

[00:19:03] Max Clark: Understandable. But you know, it's, it's, you know, it's, it's a, it's a nature of the business and you have, you know, you know, really your EMR, you know, running, maybe your virtualize your desktops, right?

Like there's, there's integrated platforms. I mean, two people in it for four oh oh employees, you know, that's, that's 200 to one is a. Pretty intense ratio, right? So efficiency and platform.

[00:19:30] Dustin Young (EVP At Enzu): were hard to, uh, have. I mean, they, they got interrupted constantly. It took a long time to get through the process, just because you gotta watch how intensive their life was.

[00:19:39] Max Clark: You know, we, we talk, and I ask a lot in terms of like, um, infrastructure expense as a percentage of revenue, right? Like, have we, have, we actually boiled this down, but you know, in this world, right? Nobody's gonna, you know, taking a 300 to 400% increase in, in platform licensing, right? Like throws the whole thing out the window.

It's like you're not even gonna have a conversation about it anymore. So now we're, so, [00:20:00] now we get faced down a, a path right? Where, uh, this organization has to decide. I. A lot of things, right? Stay on-prem. Switch to platform. What? Provide support, training and education. Go off-prem, go to cloud, which cloud, how do you, you know, do it By the way, going, going from on-prem hypervisor to like AWS EC2 instances.

Huge uplift and expense as well, right? Data, data transfer, all these different things. Um. I'm, I'm, I'd love for you to walk me through that, that dialogue and that conversation

[00:20:36] Dustin Young (EVP At Enzu): Yeah.

[00:20:38] Max Clark: you know, how deep were they into this process when they found you or you found them, and where did the conversation start and how, how did this solution narrow into like, this is what we're gonna end up doing.

[00:20:51] Dustin Young (EVP At Enzu): Yeah. So, you know, with being a hundred percent, uh, a partner organization, we got introduced the organiza, the, the [00:21:00] healthcare company was actually already, uh. Doing evaluations. Um, they had even out and gotten some of the software replacements that exist, um, to test. So they loaded it up and tested it, and one thing they realized is, um, it wasn't better.

And in some cases it was worse, right? So they didn't understand it. They had a major learning curve with the interface they. Couldn't make the software perform the same. Right? 'cause they didn't understand all of its nuances. And so this, the, just taking the software themselves and doing it became quite a bit of a challenge during our conversation.

So they brought up all the pain points, um, including, you know, 'cause, you know, we're foundationally prox mocks. And then we wrote everything and built our entire ecosystem from there. so they, um, they had even tested Prox box on their own and theirs was it, it. It's not hard to use [00:22:00] necessarily, but there's a lot in here to, to do like in, you know, it's, it's much like if you handed somebody, um, the vCloud Foundation or vSphere licensing package and said, here, build a cloud.

I mean. They're in trouble if they've never used it. 'cause if you just look at the interface itself, it's wildly complex. And so, that's, they had started that evaluation. So originally when we were at Prox Ox, they're like, oh no, we're not sure to use it. So we had to go through that process of explaining, right, check out the interface, learn how we build things. So it was, it was the sales cycle on this one. six months because they first, as we talked about, uh, 201. Uh, and so, um, 80% of the meetings were interrupted at some point by something. and, um, then just going through the process of education, the environment, what they really needed to do, and then how they were gonna reconnect some [00:23:00] of the things, right, if they went into a cloud or into a data center. and we agreed to, we went into a new data center that was regionally closer to them to alleviate some of their concerns. that's one of the beauties of, of what we can do. but they, you know, how do they reconnect their security? I mean, they, it's not that they didn't have some of this stuff, and because they're, you know, uh, regional healthcare that, that, uh, serves into some of the underserved communities. There are services they were getting that we, we couldn't just move them far away. We had to stay within the region to some degree to do business with them. So, and we also do an on-prem version, the question became, do they really want to keep that problem home? So they had a choice actually with us, of which one to do, and ultimately they did decide to go into a data center, cloud-based platform.

[00:23:56] Max Clark: That decision. I've had this conversation with a lot of [00:24:00] CIOs, hospitals specifically, where, you know, you get into this conversation really quickly where it's, they want to have the data center in their hospital.

[00:24:08] Dustin Young (EVP At Enzu): Mm-hmm.

[00:24:09] Max Clark: Now, if you're running a large facility, I. You're a tier one trauma location, and you already have a, you know, a really sophisticated facilities team maintaining generators and air conditioning and oxygen systems, and like all these other things that go into the hospital.

Adding data center footprint on top of that isn't a big stretch for, for people, right? Like, you know. You, the power can't go out. You've got generators, you know, it's like you, you, but if you don't already have that skillset of, you know, how do you maintain generators and how do you do load testing and how do you have UPSs and how do you have air conditioning?

How do you do, you know, um, you know, cooling. I mean, it, it's, it's, it's one of those things that feels easier until you start to do it, and then you get a little into it and then you find out it's not that exciting. Running these things long term, especially with the [00:25:00] maintenance requirement and the service requirement.

So it's, um, what, what finally, what finally pushed 'em over the edge.

[00:25:07] Dustin Young (EVP At Enzu): number of updates

[00:25:08] Max Clark: Oh,

[00:25:09] Dustin Young (EVP At Enzu): completed

[00:25:10] Max Clark: oh man.

[00:25:11] Dustin Young (EVP At Enzu): like just the, the day-to-day management of the infrastructure. I. With infrastructure that was, you know, had hit about five years old and the day-to-day management of the updates. And, that had become a very real issue.

And so here they are being asked to go fix to ablation units or whatever is happening in their hospital, right? So they stuff to go out and do like the infield and then, you know, they're now at a place for how many hours do they work? To and, and that way get all the hardware updated and, you know, their VMware was actually getting to be out of date and their operating system was out of date.

And, you know, how do they do all of that? And that was one of the, the key [00:26:00] drivers of the decision to go in data center. The other key driver to go in the data center is out of the hospital, which it isn't like they built racks and I mean, it's was still just like stuff in a closet effectively. They're delivering to all the clinics who are running virtually off that hardware. So, um, they had all these right? These, into that ecosystem, they're at the mercy of, of some of this very rural healthcare. I mean, you know, outside of the main city. This, this particular area is pretty rural. So they're at the mercy of all these bad connections and, um. just doing work right in and around the hospital. And so the main hospital that had the hardware, so lots of things ultimately drove the decision. And it came from in the end, right? So it was, it was those meetings on, you have two paths, [00:27:00] these are two costs. and then leadership said, well, if I stay at VMware, it's as expensive anyway. And, and I'm on five girl hardware, so I gotta buy all the hardware anyway. Um, and then. If I did something I actually don't generally like to do in a deal, they wanted me to do like a, um, uh, an ROI or, you know, write up our entire, and I'm like, well, I don't know all the costs of your ha.

Like, this is one of those things that people ask you to do. And you're like, all right, I'm gonna, and I just said, I will help you here, but I'm gonna, I'm gonna guess a lot. I'm gonna just basic, I'm gonna do the thing I have to do, which is make some, some assumptions. I said, so I can't know all these costs.

And so the IT director went to the CFO and said, I had this done. They did it. Um, and it just seems really high. I just, I can't imagine if we bought new hardware today that, you know, it would be this expensive um, you know, doesn't get free hardware like they used to. So that's one of the big shifts as well.

Like, you know, back in the day they got a lot of free hardware, right. [00:28:00] Um, they looked it up and he is like, well, based on current lease costs. Yeah, this is actually really close. And, and of course with hardware, I should be close. We buy enough of it. Like

[00:28:09] Max Clark: Yeah.

[00:28:10] Dustin Young (EVP At Enzu): close on what hardware costs and leasing is.

Right. But it, it actually, we come out at almost the exact same cost as a service as they would on hardware leasing and licensing just for virtualization to all the other things that they would have to buy. Um, 'cause leasing rates are, what, 11 to 13% right now?

[00:28:30] Max Clark: Oh, surprise.

[00:28:34] Dustin Young (EVP At Enzu): Yeah, so it, it was a fascinating, it, it was really fascinating to walk through this entire deal because there's so many things that led to a final decision. It was, wasn't just that, you know, the interface was simple to use and the IT people, it wasn't just that we took over a bunch of management in a co-managed environment.

It wasn't that we did the migration for them and they didn't have to. Um, it was all of the steps along the way. [00:29:00] Because as you stated right in the beginning, um, they are used to being on prem and the idea of moving all that and the work it takes was alarming through several meetings for them. Like you could tell that was something that was a big fear

[00:29:18] Max Clark: It's a, it's, I mean, look, if it was a. Probably a 50% price increase in the licensing, they probably would've swallowed it. You know, there's,

[00:29:27] Dustin Young (EVP At Enzu): actually. Yeah. I, they were that afraid of moving.

[00:29:30] Max Clark: yeah. It's the, the, the, the risk of change, um, and the certainty of inaction as a result, right? Like, it's, it's, um. You know, it, it, I mean, there is, there is a, I mean, there is a, a strong magnetic force to not changing, right?

Once you have stuff implemented, um.

[00:29:51] Dustin Young (EVP At Enzu): Well, and I think it's why as providers, I mean, we're not unique in this part. Uh, we have developed a. A migration like we [00:30:00] do it. understood that for a lot of them, again, their IT staffs, unless they've got lots of free flowing capital, are not very big. And so, um, the time it would take to do that, uh, means they can't actually do anything else.

'cause you can't just be down or you can't just constantly move corrupt data all night. Right. You have to know the process and understand it. And so, um. I think that's why, you know, we've done migrations for a long time, but now there's, everybody has like this whole migration strategy around this now. I mean it's, I've seen it across most providers now.

[00:30:39] Max Clark: So you have six months to, for a decision, which results in them having to say, you know, stay on prem, stay with the VMware, you know, pick one of a bajillion alternatives that we can't. Operate ourselves. Go on-prem with you, go off-prem with you. They decide, okay, we're gonna go [00:31:00] off-prem with you. Um, then you, you know, we have, I'm, I'm not gonna hold you to these numbers, right?

Because then you get into the contracting and, and legal review. Right. Which is just like, I mean, that's just, who knows, right? Like that could, nobody has control over that process. Um. What, what's the, what was the, what's the migration like? I mean, talk about having a migration process and in this case it's more than just migrating a hypervisor, right?

It's, it's, everything else has to go along with it in these things, right? You know, now we're talking about are they evaluating circuits and an SD WAN or SASS E strategy as well? What's the connectivity and how do they, how do they, you know, you cloud security, how do they move that infrastructure over? So a two person IT team isn't a lot of resource.

[00:31:46] Dustin Young (EVP At Enzu): Yeah, so we met with, so one of the things I requested, um, and had my team do was to get meetings with the other providers who were impacted by the decision. 'cause they weren't going anywhere. I mean, most of them [00:32:00] were a, a part of this move and said, Hey, what you know. does it take? What do you to make this change and it not affect them and, and shut them down or cause a lot of problems?

What do you need from us? What does it take? We actually didn't just migrate the infrastructure. We built a migration plan for setting up the networking. Um, delivering dedicated. So we delivered the dedicated top rack switches, which we, which we do. It allowed all the organizations to deliver all their own BLANs.

We gave different people, um, different administrative rights to just small segments. So that's one of the beauties of, of our infrastructure is, is that granular control. And they said, yes, you can allow, you know, so and so party. Into the switch so they can set up their VLAN architecture and set up our security platform. They can set up our, you know, our SSE platform and our SD-WAN and all the things. So, and then, yes, you know, an appliance got delivered [00:33:00] from, you know, the, uh, healthcare network organization that supports them, that went in, that then lit up that, um. That, that network topology for all the rural healthcare.

Right. So, so we, we put all of that in place and we tested all of it before we started to move any of the actual workloads. So as, so it wasn't a, a lot of people there are like, yeah, we'll, we'll move the workloads, we'll migrate that. The question is still leaving a small staff to deal with all of the other components. And we actually took on the project management of the ecosystem. Project managed until the environment was ready for that, the compute to then migrate. So the compute was built and ready to go, but it sat there because it was basically just being used for testing of all the other things, um, that needed connected and the applications that needed loaded from, from some of those providers.

So we built VMs for [00:34:00] them to do that with, to start, so that all that was ready to go and they could launch. All of their applications, all the security applications and things that are out there. So, so we knew the environment was secure and ready to go before data ever moved onto

[00:34:14] Max Clark: How long, like we're talking weeks, months.

[00:34:16] Dustin Young (EVP At Enzu): days.

[00:34:17] Max Clark: How long was your total migration?

[00:34:19] Dustin Young (EVP At Enzu): Uh, their total migration was about 60 days.

[00:34:22] Max Clark: That's really short.

[00:34:23] Dustin Young (EVP At Enzu): We, I, you know, I, I find the whole migration thing fascinating because I would say a majority of our migrations are between 30 and 60 days. And we're not talking, I mean, you know, we're not talking about two VMs or, and we're reasonably sized clients. Um, know, my past life migrations could be six months. Um, and I, I, I started to ask myself when, you know, why are these migrations going the way they're going? And it's, know, I, I, I sat down with, with our. Technical leader and said, Hey, I don't what is going on. How do you, how are you getting some of these done? And he's like, well, they're not hard. [00:35:00] Um, a greenfield plan, you get the data, you put the data on, you test it.

He's like, there, there's you, you understand all the dependencies and you move the data. And he, and he's like, the thing is, um, a lot of organizations complicate the process with the way, like, so he is like, they use, he's like, so they use Zerto to do migrations and so it's this. It's this constant rate of change. And he's like, and then you are just moving an existing environment as it was built. So then you're cleaning up the broken things on your stuff and you, you, he's like the testing and the cleaning up is like, and we actually grab it all, look at it, confirm it, check it, and then we just put it on the system and he is like, and so there we're not spending a lot of time cleaning up. Old architectures. And so the, they spend the time going through it. They review all the data with the client, and then they say, Hey, here's what should be done for this migration. And it seems to simplify the time it takes to get people moved.[00:36:00] 

[00:36:01] Max Clark: After spending, I'm gonna dam myself here over 25 years doing network and data center migrations. Um, there's always the idea of. We can figure out how to do this with no impact and no downtime over a longer span of time. Right. We're, we're gonna do, um, you still my camera?

[00:36:26] Dustin Young (EVP At Enzu): you're frozen. I can see you though.

[00:36:27] Max Clark: Let me, let me stop it. I'm actually not gonna stop.

I'm just gonna stop my camera and start back on. Struggling to record what is going on here. Isn't one for me. Probably Chrome in the background. Taking all my, uh. Oh my, oh, my memory still frozen.

What I'm gonna do is I'm gonna stop, let's just do this though.

​[00:37:00] 

PART 2

[00:00:00] Max Clark: If there's one constant in tech, there's gonna always be a problem at some point. Right?

[00:00:04] Dustin Young (EVP At Enzu): What was fascinating is when it did it, it um, it sent my computer that, that shutdown sent my computer into some kind of cycle with it, and I'm not using Chrome actually on this one. So

[00:00:19] Max Clark: It's, you know, what do you do? So saying,

[00:00:21] Dustin Young (EVP At Enzu): it just started to loop. I was like, oh,

[00:00:23] Max Clark: yeah.

[00:00:24] Dustin Young (EVP At Enzu): I

[00:00:24] Max Clark: Um.

[00:00:25] Dustin Young (EVP At Enzu): you. Uh, we'll get back to where we were. Uh. Microsoft also is having some very interesting problems over the last few weeks since their last big AI update, um, to their platforms. And um, yeah, we're, we're getting the largest amount of, uh, severity alerts I've ever seen. Um, so the system often thinks something's attacking it and that pretty fascinating. and so we're, we're dealing with that and then it's people's teams will just. Uh, one of my place had 11 instances of [00:01:00] teams open and running in their, and on their, and it just cr kept crashing. Every time they'd open teams, it would just keep reopening and it would crash the laptop and it did it in a cycle, and we had to go through and do like crazy updates to shut it down, like.

[00:01:15] Max Clark: You know what's, uh.

I, I was part of the dos to Windows 3 1 1 transition, right? And so my, my like Windows 95, windows 98 windows, me windows in T four. Oh. You know, like I, I've seen it, right? And, and, and like. For the most part, these platforms are pretty stable nowadays. I mean, you, you know, like you can get frustrated about, you know, the browser forcing an update and killing you like halfway through a recording.

Right. But, but like, for the most part, like it's, you know, like how often do you have to reboot your computer every day? Like, I don't, I [00:02:00] couldn't tell you the last time I did mine, you know, I actually do it once a week. But, um, that's only to force updates on everything. But I mean, it's, it's, it's so funny that we're like, you know.

I, I mean, I, I feel like if you're just starting now in tech, like your short term memory or like your, your like history of this stuff is like this pa place of like relative bliss, you know? And like no pain. And now of course we're gonna go through a major tech refresh, you know, and it's gonna be like all pain for people.

It's just bad.

[00:02:31] Dustin Young (EVP At Enzu): I, uh, I, you know, when I was in college, I think it was just Windows 95, right? uh, right. 'cause previously all the same thing, right? If you

[00:02:41] Max Clark: Yeah.

[00:02:41] Dustin Young (EVP At Enzu): to do dosser command prompting, you basically didn't, couldn't use a computer and, um. I bought some PC and you know, I had the old monitor that sat on the box and all the wonderful things and it got to a point where every time I turned it on, I had to hit it and then the disc would spin. [00:03:00] Right.

[00:03:03] Max Clark: I fish.

[00:03:05] Dustin Young (EVP At Enzu): You know, and until, you know, until I could get to Frys. Right. We all

[00:03:08] Max Clark: Yeah. Good old fries. Yep. Heck yeah.

[00:03:11] Dustin Young (EVP At Enzu): and fix it. That's how I turned it on for like two weeks.

[00:03:14] Max Clark: I was telling my kids I bought 'em a, we, I bought a, a micro SD card for, uh, for their Nintendo switch and it's 256 gig, you know, and of course the thing is like smaller than my pinky nail, right?

[00:03:23] Dustin Young (EVP At Enzu): Yeah.

[00:03:24] Max Clark: you know, and of course I, I have these moments every single time where I look at it, I'm like. This is 256 gig, a microSD card.

It cost me $25 and, and my first like real hard drive I bought at Fry's 1.06 Gig Fujitsu, you know, IDE Hard drive. And, and it was crazy expensive. And of course I plugged that bad boy in. It was like, I have storage forever. You know, like, but this is the same thing, like people, like, you know, people start using Linux systems or you know, some sort of Unix derivative system.

And the reason the file system is. As organized the way it was is because the hard drive sizes and you [00:04:00] needed to have a root drive and then you had like a bin bin drive and like utilities drive, and then you had like your storage drive and your user drive and like, it was just like this practical reality.

You had to have different hard drives, you know, and, and nowadays just like, ah, I just, I just got, um.

[00:04:16] Dustin Young (EVP At Enzu): shit, a new NAS device, you can just slam some M two NVMe and roll. I

[00:04:20] Max Clark: Oh man, I, I was putting this off forever and finally like, cracked and put a, put a, um, nas in my house and I have, um, uh, what did I start with? 2 24 terabyte hard drives with Then of course, you know, M two, MDME, like caching and stuff, and you're just, and you just like have this moment where you just look at it and you're like, I can remember the amount of pain I went through.

In different phases of building this much storage, you know, for, for either,

[00:04:50] Dustin Young (EVP At Enzu): keeping backups,

[00:04:52] Max Clark: oh man,

[00:04:53] Dustin Young (EVP At Enzu): that was not an easy thing back in the day.

[00:04:57] Max Clark: we had, uh, one of the funniest things, this is, this is [00:05:00] like true like Nerdery, um, I'm trying to think the year, the year would've been circa, uh, I dunno, 2002, let's just say somewhere in that territory. And, uh, we were running, um, Oracle eight. It wasn't eight I yet, so Oracle eight Sun, um, went from uh, e four twenties to 45 hundreds and then had a, what was, um, uh, what was originally a deck alpha storage system.

So controller with dis shelves and they were scuzzy attached storage with, with a two ter, with a two gig fiber channel. You know, back plane. This thing was so expensive and, um, but you could get on the console and you could do a locate on the hard drives. And so you could tell it to like, locate in a specific device by Id, you know, l or you could say like, locate based on a rate set or like a volume set.

So you could actually be like, oh, you know, I'm presenting this volume to this host. Like show me all the hard drives actually in this volume to like visually. Understand. [00:06:00] And we would, when we were bored in the data center waiting for updates to apply, we would like, can we make the sand look like a Christmas tree?

You know? And it'd be like, you know, and like, what patterns do we need to get in order to make the lights shine? You know? And like, but of course, you know, you're, you're trapped in a data center for six hours waiting for something to happen. But like you talk about your hard drive spending, this is a thing like.

You do some update on a server and you reboot the server and, and like, oh man, compact are the worst. And you have this like initial, like, is this thing turning back on? Like just long enough before you got the post where it was like, I don't know if this is coming back online. Like, and now what do I do?

[00:06:38] Dustin Young (EVP At Enzu): Well much to like this, it it, if you had to go through a PC reboot. To relaunch this, we'd have been 20 minutes before we ever got

[00:06:48] Max Clark: Ugh.

[00:06:50] Dustin Young (EVP At Enzu): like,

[00:06:51] Max Clark: I wanna get back into migration 'cause I don't wanna segue to a different thing.

[00:06:53] Dustin Young (EVP At Enzu): yeah, yeah.

[00:06:54] Max Clark: And IWI was,

[00:06:55] Dustin Young (EVP At Enzu): to talk about,

[00:06:56] Max Clark: well, well, I, I dated myself and I'd said that, you know, in [00:07:00] 25 years, you know, I don't know how many networker and, and systems and data center migrations, I've done like a lot. And, and there's a mentality in this idea of like.

We, we've gotta do these like really prolonged migrations, that way we don't have a painful outage. And it's like every time you do that, it's like you don't have a painful outage. You end up with like 16 weeks of painful outages that are just nonstop. And after doing that for a long time, um, I'm a, I'm a big advocate for like, just do the migration.

Like pick a day, you know, I mean. I'm not like a holiday weekend guy, but like, you know, if you start on a Thursday, you know, and your business is impacted on Friday, I promise your employees are gonna be okay. Right. You know, and, and, and you, and you can still have relatively minor disruption if you plan this ahead.

But you know, even like worst case, if you start on Thursday and you do Friday, Saturday, Sunday. On Monday, you're gonna find stuff. You always [00:08:00] find stuff in a migration that you just didn't realize. There's always something you find, but then people come in on Monday expecting, like, it becomes like a scavenger hunt almost.

It's like find all the things that aren't right, you know? And like, and like make it like a. You know, like this company-wide, kinda like, we're all in this together, you know, not company against it, you know, like we can't work. But like if you, if you fold everybody in, you can get this nice like, culture kind of team building moment.

And like everybody's invested and everybody's like there. And then, and then by Tuesday it's usually okay. You know? And like you're done. People are finished. It's, and that's like worst case. I mean,

[00:08:38] Dustin Young (EVP At Enzu): Yeah.

[00:08:38] Max Clark: lot of migrations do not look like that, but like in my, in my explanation, my worst case migration is that where it's like you start on Thursday, you're done on Tuesday, you know, like whatever.

Um,

[00:08:49] Dustin Young (EVP At Enzu): Well, and it's, it, it, it's sad. Doing it faster means less iterative data changes, so there's less opportunity for, you know, death by a thousand paper cuts.[00:09:00] 

[00:09:01] Max Clark: So I wanna dig into this more, right? And, and what I wanna, I wanna ask you about is, first off, I hate the term repatriation. Repatriation. Like, it, it, I, I, you know, because especially in this case, right? This. You know, like repatriation, connotates, like you had it on-prem, you took it to cloud, you brought it back on prem.

And, and, and I, I really hate that like, presentation of it because it doesn't really mean what's actually going on a lot of times in organizations. And, and what I'm, I'm more kind of curious to talk about is. You know, not necessarily why you should be in cloud or why you should be off cloud, but like kind of the trade offs in this conversation and, and talking about it with, you know, here with this, this, you know, you know, hospital and clinics of like, this is what you gain, this is what you lose.

You know, we're relatively agnostic because we'll do it on-prem if you really want us to, but we [00:10:00] really don't want to because these other reasons,

[00:10:02] Dustin Young (EVP At Enzu): Yeah.

[00:10:03] Max Clark: like. Like role play with me a little bit in this conversation. 'cause you know, I'm, I'm fascinated to hear your take on it.

[00:10:09] Dustin Young (EVP At Enzu): Yeah. So the main driver that seemed to emerge were on-prem versus data center, moving this into the cloud or data center was could they touch it? How quickly could they touch it? How quickly could they get to it if they needed to do work? so. You, you, we get into these questions, right? Um, well how often do you do that? Um, and how often do you do that? How often does it happen while you also just happen to be in the office? Right. And how often are you doing that when you are in Maine for the weekend or wherever you've gone in your life? Right? How often are you being asked to come in from somewhere to touch it? [00:11:00] What are, what are the implications of that?

Right? So, you know, parts of the hospital don't close, right? It's a hospital, right? So there's parts that just never close. so you have to have somebody who's, you have two people. One of you must always be on call. Um, and so what happens? Like, uh, does everybody live within 10 minutes? Is there some, you know, do you live an hour or two away from the hospital?

Are you commuting? Um, and so all of these questions started to drive a decision because they were. Really understanding why they felt the need to do that. And again, it

[00:11:33] Max Clark: Was this driven by the IT team, or was this driven by executives inside the hospital that weren't necessarily on the day to day?

[00:11:39] Dustin Young (EVP At Enzu): this was a conversation between us and it

[00:11:41] Max Clark: Okay.

[00:11:42] Dustin Young (EVP At Enzu): they, they were trying to weigh out why, why would they make some of these decisions? And was part of the, build a, build a roadmap. To, to come to a conclusion, right? So, um, think about it in the framework of second decision road mapping, right? So we make a decision, what's the second [00:12:00] thing?

What's the third thing? What's the fourth thing, right? What are the positive things? What are the negative things, right? So, so we essentially walked through that framework, decision making framework. And what ultimately came about, um, that made them choose the data center is, um, more often than not, when they have to go do something, they're, it's, they're not there. And if they are there, they're being called from something else that they're currently doing, repairing, replacing, updating. so they are abandoning one thing to do another if they have to. And often they don't know the criticality of the request. Somebody says, we can't get in. It's, it's down. People say it's down, but it's, it.

90% of time nothing is down.

[00:12:48] Max Clark: Mm-hmm.

[00:12:49] Dustin Young (EVP At Enzu): They just can't get to it and that's just their understanding. It must be

[00:12:53] Max Clark: Right,

[00:12:54] Dustin Young (EVP At Enzu): Uh, somebody can't get to Facebook. Facebook must be down it. It's probably not down. There's probably something else going on. Right? It [00:13:00] isn't like

[00:13:00] Max Clark: Yeah.

[00:13:00] Dustin Young (EVP At Enzu): just went, turned off all these data centers around the world, right.

All at once and so, right. Because you might get to it slower, but you're going to get to it, so, right. The idea is they use that term and when you're two people, you don't have a choice but to react.

[00:13:13] Max Clark: Right.

[00:13:13] Dustin Young (EVP At Enzu): So they're no longer, so one of the things we talked about is do you wanna respond to it or do you want to continue to react to it? Right. And so in the world of what we do when we, when we enter into the co-management phase, 'cause they, you know, they also have a choice. They can self-manage or co-manage with us. means, you know, their respon, they, they get it, it's a price. They're using it, it gives 'em everything, gives 'em tools.

But outside of bios, updates, we generally don't touch it. Right? It's theirs. Whereas in co-management, we way out the runbook, we develop the rules and we understand who's doing what in the environment at all times, which means we help set up the triggers, the actions, the outcomes, the pre-approved actions and all those things that come with [00:14:00] running a club. And so in this instance, their team was like, so if. Somebody says it's down, I can just open a ticket and say we're having an error. And then we can determine if it's in the hardware and the cloud, or if it's a switch on our side or if it's like, like we have some support so they can start to see, okay, I'm gonna look at just what I have here while you look at, is there anything on the bigger infrastructure? so that is ultimately what drove the decision because we have better. We have better control when it's inside of a data center because we have multiple ways to get to it

[00:14:41] Max Clark: Mm-hmm.

[00:14:42] Dustin Young (EVP At Enzu): if it happens to be their network, we are also now blind.

[00:14:46] Max Clark: Yeah.

[00:14:47] Dustin Young (EVP At Enzu): So that was one of the things was we can support you we can support you well, but we can support you better in this other decision.

[00:14:57] Max Clark: Feel like how quickly can you touch it? Is [00:15:00] it really it? It's man, it like takes me in so many different directions at the same time. Because first off, how often are you touching it? I think that's a great question to ask. Right it

[00:15:09] Dustin Young (EVP At Enzu): except in like panic mode. They

[00:15:12] Max Clark: right.

[00:15:12] Dustin Young (EVP At Enzu): actively touching it and keeping it up to date.

[00:15:15] Max Clark: Right. And so you get into this whole thing of like, how often are you touching it and like, what do you actually need to touch?

And then you say like, you know, this isn't like 1999. Like, we have like an incredible amount of remote access capabilities for infrastructure. And, and it's like if you are actually physically touching it, it's like immediately like what is going on and what's wrong? Like I look at that, my reaction to that now becomes like something is fundamentally broken.

If you are actually in that situation, I mean, you know, it's,

[00:15:45] Dustin Young (EVP At Enzu): be rebooting that except through software, unless the world has gone very wrong for you.

[00:15:50] Max Clark: well, you know, I find organizations all the time where it's like, they talk about like, stability issues within environments and, and [00:16:00] like the first thing that comes into it, it's like, what are you guys doing? Like, like again, you know, what, what are you doing? And, and,

[00:16:07] Dustin Young (EVP At Enzu): If

[00:16:08] Max Clark: and like, uh.

[00:16:08] Dustin Young (EVP At Enzu): up VMs correctly, that it still is utilizing resources when it shouldn't be because, VMware just sort of works like that if you don't do it correctly and Right. So we see a lot of things that cause that instability.

[00:16:22] Max Clark: self-managed versus co-managed for me also usually feels like it's a, we've had bad experiences with a provider that doesn't give us adequate support, so we still need to be able to do it ourselves. That way we're not dependent on somebody else who's not communicating with us. Um, so we have to have a mandate of co-management,

[00:16:45] Dustin Young (EVP At Enzu): Yeah,

[00:16:46] Max Clark: but we actually don't wanna manage it if we could not manage it.

Right. I mean, and this is, you know,

[00:16:52] Dustin Young (EVP At Enzu): small, like smaller and smaller things. They, they sort of disappear when their support is good.

[00:16:57] Max Clark: yeah. I, um, [00:17:00] my, my version of this I ask a lot with, with new. With new IT teams or new clients is, when's the last time you took a vacation and did you take your laptop with you? You know, like, and you can, you can tell a lot by the, not even the response, just how they look at you when they respond. Um, 'cause it's tough.

Yeah.

[00:17:20] Dustin Young (EVP At Enzu): can ask that of most employees across the tech space at this point, and it's, uh, um. It's staggering actually. Um, how many people can't go away for just three days without taking a laptop with them?

[00:17:37] Max Clark: What, um,

you know, I, I, I'm. Unfortunately, there's a lot of this that just comes into, like, you don't believe it until you see it with your own eyes kind of stuff. Right? Like you can run infrastructure in a different way. You don't have to have it physically OnPrem, you can put it into a data [00:18:00] center. Migrations aren't scary, right?

Like, but until you've experienced it, especially if you've experienced it done poorly in the past, like your, your memory of it is bad. Like how do you, like, how do you actually start to work, you know? And, and. I don't wanna say like, just change the perception before you go into a decision with these things.

Because somebody who's just had bad experiences with migrations isn't gonna wanna run and go say, Hey, let's move off VMware and let's go to this other thing and let's take it on-prem. And, and I mean, you know, ROI and TCOs, you know, like whatever, I hate them. But, um, you know, you still, at some point somebody has to sit there in a room and make a decision and say, we're gonna do this.

And like, I believe this is the right way and I believe it's not gonna cause us more pain along the path.

[00:18:46] Dustin Young (EVP At Enzu): Yeah. Well, um, one, it's the whole point to POCs, right? So you can try to show them through proof of concept, what the model looks like. And we do that. We have that running. [00:19:00] Um, we take 'em through, alright, show us what data, give us access. We actually put that data on the environment, show 'em how it goes, and then let them actually touch and feel the environment themselves. So I think that's one that, that doesn't solve all the problems. Because it isn't your entire ecosystem. Most people just give you some small subset of data and that, that's not, that's really not hard to move, right? 'cause it's, you're moving a snapshot in time that they don't have to worry about the latest and greatest data that replicated 15 minutes ago got moved.

Right?

[00:19:32] Max Clark: Mm-hmm.

[00:19:33] Dustin Young (EVP At Enzu): this is a snapshot in time. So it, it's way to show 'em how it works, but it doesn't answer every question. and then I think other customer referrals saying, Hey, you know, especially in healthcare, we've, we've done a few now and say, talk to this customer. They'll explain, you know, where they had pain, where it went well, um, no migration.

I mean, I've not had one ever just go perfect where something doesn't rear its head. Uh, things like, um, that's cool. We, [00:20:00] you didn't tell us that existed, uh, is a thing.

[00:20:03] Max Clark: They probably didn't realize or know.

[00:20:04] Dustin Young (EVP At Enzu): didn't remember it existed and I

[00:20:06] Max Clark: Yeah.

[00:20:07] Dustin Young (EVP At Enzu): it was still out there doing anything, but we better move it because it's doing something.

[00:20:10] Max Clark: Yeah.

[00:20:11] Dustin Young (EVP At Enzu): or, uh, oh, you, you haven't paid your maintenance bill. So yeah, the, your login doesn't work, right? Or it's all, there's just things, I

[00:20:22] Max Clark: Yeah.

[00:20:22] Dustin Young (EVP At Enzu): things that come up. Um, or, you know, you've got, you know, do you realize some of these VMs actually are here, but they don't, they're not doing anything. Um, so you have to stop and actually clean that up, right?

So you say, Hey, we should clean this up. understand what BMS are still active and running and you know, um, and people don't know, sometimes they turn something on, um, or somebody has, and they don't. It just sits there and, and they never go back to it. And so you find during the migration you're like, Hey, this, this is running right.

Does it need [00:21:00] to be running? And it's actually means we can't migrate you until we go in. And fix it or, or understand what it, what the dependencies are so we don't move it, and then we break whatever it's supposed to be, know, attached to. Um, I also think that, um, one of the things that's really fascinating is especially coming off prem, but this is, this is true to some degree coming from other service providers, but especially off prem. When you first go in and have a conversation with them, they give you their, either they run like RV tools or live optics, or they just give you like, here's what we, we have. But you say, okay, but what are you using? Right? Because for a lot of these staff, when they go out buy hardware, I. They know that getting an approval to add to that hardware is not easy.

So they buy the biggest chunk of everything they can,

[00:21:53] Max Clark: Oh.

[00:21:53] Dustin Young (EVP At Enzu): of extra storage. And then when they come to you and they're moving to a cloud environment, they say, I have, you know, nine petabytes. And [00:22:00] you're like, well, but you're using 200 terabytes, why don't we just build 200 terabytes plus 20% overage?

And like, but I have, you know, and it's, that is actually a really fascinating, uh, component, um, because It that actually takes a while when, when you're talking about what you're gonna migrate, it takes a while to actually understand the, the in use environment that will move versus, what they bought. And it was true in this case as well. I mean, they still weren't using 40% of the storage. That was five years old.

[00:22:37] Max Clark: Uh, I'm, I'm like having violent, like trauma flashbacks with that statement. I mean, I see the same thing like, you know, all the time you have, what, what's the one? Uh, we have 40, we have 40 racks of equipment. We wanna upgrade our network. Um, we've decided that we have to go out and buy this cutting edge, latest and greatest, blah, blah, blah, fill in the [00:23:00] blank switch.

There are $25,000 a piece. We need two of them per rack. We need $2 million worth of switch, plus our core infrastructure, plus our support agreements. It's gonna be, you know, the low, low price of, um, you know. $2.8 million. Right? And then you go to the organization, the organization goes, no, you're not getting $2.8 million to upgrade the switches.

Right? And, and I feel like this, that is such like, I, it's like the IT team just shooting themselves in the foot. And in that case, that example, for instance, um, uh, we did, um, I think we did 3002 times $3,000 a cabinet. Across all 40 cabinets is what we ended up upgrading them for. Right. So $6,000 per cabinet versus $50,000 per cabinet.

Right. And, and I, you know, and, but it's, it's so true. It's just like, 'cause the procurement is so hard and getting that through everything is so hard and your cycles are [00:24:00] so long. 'cause the other thing is true, you know, like, nope. How long do you have to run this thing for? Five years, six years? Seven years.

Like, probably a long time. And, uh,

[00:24:09] Dustin Young (EVP At Enzu): Yeah.

[00:24:11] Max Clark: I mean five years I. You know, five years is pretty much the standard, right? It's like, this is, by the way, a little, little PSA, like a good, good reason to buy name brand manufactured hardware is you have support options that extend out to 60 months. You can go and you can still get, you know, dot cards and raid controllers replaced and things, you know.

It's, it's not, you know, you can get a cheaper box from somebody else, but like that box doesn't exist in 18 months. Like they're under the next box. So, um,

[00:24:43] Dustin Young (EVP At Enzu): That is another big component. You know, you're talking about the, the components that would need repaired and replaced.

[00:24:50] Max Clark: yeah.

[00:24:51] Dustin Young (EVP At Enzu): I, I, it's fascinating that most people. Talk about SLAs. They, they don't want to talk about the hardware. I actually customer like, well what's the SLA? And I'm [00:25:00] like, listen, these are all the parts we actually keep where your private cloud is because what's hardware? it is something is going to decide, it wants to exit stage left at some point. Right? It just happens like it, uh, you're going to do something and the hardware's not, it's gonna get hot from something. It's uh, it's in a data center, it's somebody is gonna bump it potentially. Um. Somebody dropped it, you know, somewhere through the whole shipping stack and six months later a component didn't like

[00:25:29] Max Clark: Yeah. Vibrated enough to finally shake out a place. Yeah,

[00:25:31] Dustin Young (EVP At Enzu): Yeah.

[00:25:32] Max Clark: I mean, we had, we had one major CDN vendor, um, uh, I had, I had infrastructure next to 'em in a data center and you know, very hot. Very hot, dense, not enough cooling. You know, like these are, you know, the wild, wild west days, right? And they had a problem where, um, you know, after enough time the plastic retention tips or the eclipse holding their hot swappable hard drives in, started to fail.

And so the clip would fail and the hard drive [00:26:00] would've checked, like, troubleshoot that issue, right? Like, you know, um, the,

[00:26:08] Dustin Young (EVP At Enzu): I

[00:26:08] Max Clark: so.

[00:26:09] Dustin Young (EVP At Enzu): cables, I mean, you

[00:26:10] Max Clark: Oh man,

[00:26:11] Dustin Young (EVP At Enzu): somebody opens a rack and moves 'em around to do something and then you can't figure out why it's inter and they've broken the glass. Right. Or they've damaged the glass 'cause they just grabbed it and moved it without, uh, 'cause they were doing something else. Like, I mean, these, we see this stuff all the time.

I.

[00:26:27] Max Clark: there's a big push. Dustin, we talk about this a lot and this, this, you know, and, and it's so specific to like customer, right? Which is why, you know, we're talking about health, you know, this one specifically, but you know, like cloud to bare metal, usually completely different animal. Now we start talking about workloads that are serverless, or workloads that are containerized, hopefully, right?

If you're in the cloud, you're not containerized like the, like, think about what you're doing. But, um, you know, when you start talking about. Large SI mean, I mean, shoot man, some SMB [00:27:00] definitions go to a thousand employees, right? Like, so I don't even know what SMB versus mid-market is anymore. It's like, you know, my world SMB is over 200 employees.

I mean, sorry, mid-market starts at 200 employees. 'cause it's the only thing that really makes sense to me.

[00:27:13] Dustin Young (EVP At Enzu): in there. I would

[00:27:14] Max Clark: Yeah,

[00:27:15] Dustin Young (EVP At Enzu): That's a, yeah.

[00:27:16] Max Clark: but you know, you know, I mean, there, you start talking about more traditional infrastructure and you get into this idea of like, lift and shift, which is also not really a great outcome. I mean, you talk about it from the idea of like actually understanding what you're running, what you actually need, you know, if you're not already hyper, um, uh, in a, in a virtualized environment, like what is your actual CPU density requirement?

No. You don't need one to one. Right? It's probably even denser than six to one.

But I mean, again, you now you start talking about, you're dealing, you're going through a cycle where everything is new again. Right. You know, like we've never virtualized, we've always been on prem, you know, like we're doing this, we're doing that. And, [00:28:00] um, it takes a lot for an organization. I mean, in this case, vm, you know, I.

Broadcom helped the decision along the way by just making it financially unfeasible for people. But I mean, are we, are we staring down the wave of like mass exodus off of VMware across, you know, thousands and thousands of nodes? Like I.

[00:28:19] Dustin Young (EVP At Enzu): I, yeah, I, I don't, say I have a clean answer for that. I can say that the number of people I meet with to discuss. Um, being cloud native, uh, being containerized, um, do they really, how much of their infrastructure needs any level of virtualization? Um, and are their applications suffering? And do they actually, would they, would their applications perform better? Right. In a, in a, in a, uh, containerized or a cloud native world where they're not to run many. Machines on a single machine, [00:29:00] so can they get the resources right? So that's are, are the resource underlying resources being to the infrastructure very well. And instead of in a multi-tenant, you know, I mean that's really, you know, virtualization is, is creating multi-tenancy on hardware, right? so, um, that conversations happen a lot more and. The other thing that's driving it that I find really fascinating right now. we're getting a lot more questions about, hey, on one of the nodes, could we drop, you know, a couple of GPUs, uh, and one, I think dev teams are starting to do testing, right?

What can we, what architectural changes can we make? And two, And this conversation happened, they, they decided they aren't ready to do this 'cause of the size of the team, but the conversation was there that, you know, they can do this in the [00:30:00] future. Um, and this is where VMware, uh, is also gonna be challenged right now because that stuff just works better when it's Linux based. Applications work better. Native containers to launch out. Right. Work better. Um, 'cause you're right off of a Linux-based or Linux-based KVM platform. You run native containers. You're not converting them

[00:30:25] Max Clark: Yeah.

[00:30:26] Dustin Young (EVP At Enzu): VMware's conversion system. You're just running them and you can launch them out.

And so when people say, well, what if I want to, you know, touch other clouds, right? So, so we call it super cloud for us. We have a technology for that. But people want to start touching these other clouds. Oftentimes they're, they're not talking about setting up a replication of a VM all the way to, then doing the conversion from VMDK to OVA or OV, like they don't want to do all this. This is where that whole world of containers and just moving data and infrastructure as code,

[00:30:58] Max Clark: Great.

[00:30:59] Dustin Young (EVP At Enzu): they're [00:31:00] getting to that. That is what I see. A lot of times people don't know that they're talking about infrastructure's code, but they're asking all the right questions for delivering that technology to them, to their business.

[00:31:12] Max Clark: Outside of.

[00:31:13] Dustin Young (EVP At Enzu): to see how it impacts VMware. 'cause frankly, the enterprise already does it, which is why they have more than just VMware in their world.

[00:31:19] Max Clark: But I mean, the enterprise has resources to have development and are writing applications to power the enterprise.

[00:31:24] Dustin Young (EVP At Enzu): Right.

[00:31:24] Max Clark: into, you know, outside of a tech startup, if you're mid-market or if you're SMB, you're buying software. You're not writing software, right? You're going to an ISV and you're, and, um, even having this conversation into the world of AI and LLMs right now, you start talking about.

You know, um, you're probably, you know, let's just, let's just assume you're small enough that you could run llama, that you're not gonna run into licensing issues with it, or you're gonna, you know, wanna run. You know, you're gonna, you're gonna, I don't wanna say roll the dice with deeps seek, but you know, you're gonna deploy deep seek into your data.[00:32:00] 

Um, you know that, you know, again, you need resources. And resources are people, and, and I would, I would make this argument, actually, I make this argument a lot, you know, to. It practitioners who are in this mindset of like, I have to go touch the machines. Like if you're touching the machines, you're doing not fun stuff, you know, and, and, and you're, and you're delivering limited value back to your organization, right?

Your organization needs you to drive change and modernization for the organization and help the organization run, right, like you're running. The platforms, the business needs in order to function, right? But you also need to drive modernization and transformation for the business in order for them to, you know, excel in advance and, you know, you are actively making a decision to touch equipment when instead you could be actively making a decision to be figuring out your AI strategy for your company to go, you know, figure out how to do I'm, I'm telling you, you know, like just, just.

Word of the [00:33:00] wise. Like if you showed up and you said, Hey, you know what, we have deep seeq, or we have llama, or we have fill in the blank LLM running against our data right now. We can ask, get all sorts of interesting questions and like that provides value to the business and people are gonna go, oh wow, this is incredible.

Like, you know.

[00:33:14] Dustin Young (EVP At Enzu): uh, that is so, you know, um, not to get too far off the beaten path to where we're at today, but that whole. that, that we deliver, um, that is infrastructures code and it is IS code. And what actually runs in that IS code, uh, is deep seek and lama and so they can choose and manage. And, and so somebody we're currently talking to that right, came forward and said, okay, we wanna, we wanna move forward with you migrating us onto this private cloud.

We gotta get off of, actually, they're getting off of Nutanix as a service. And so, uh, we want to get on this because, and, and one of the big drivers, we want over the next [00:34:00] 12 to 24 months get off of virtualization because, and this is not a very big business. This is what surprised, like, they actually surprised me.

'cause there's like four people in it for, I mean, they're not that big. They're, um, they're in the, uh, a wine industry

[00:34:15] Max Clark: Okay.

[00:34:15] Dustin Young (EVP At Enzu): and, um. They're like our clients, like the way we deliver applications and costing, and we need to go to containerization to lighten everything up and make it faster and smoother and we have more control of the data where it is, right?

So we we're not delivering these big BMS everywhere, but we don't know how to get an AI stack to start mining all of our intellectual property and to start asking it questions. And so we, we showed him the tool and. How they could actually build a pretty light model that's private. So that's the one thing we talk about, right? It can't be public like don't stick chat GPT in your world. 'cause they're gonna just data mine you and then I can go [00:35:00] learn about your business pretty easily, right? and so they're trying to understand how to still keep their data private, but un but build. Some kind of stack that, as you just said, they go in and they ask the ask it questions. Right. Um, I'm actually, uh, as a really fascinating side note, um, I do all this and, and I don't, we've talked about it, I think, but one of the things I do is I volunteer for Search and Rescue, so Right. So Nevada County Sheriff Search and Rescue, uh, Nevada County, California. Right. So, One day I'm sitting there and we, we do all this stuff.

Like we're out in the field, we have all these decisions, and then I see how a lot of decisions are made, and I see how all the data is looked at. And I walked up and said, what if I built an AI engine to do a lot of this? And why it had not dawned on me until two months ago to apply it to this world? I don't know. it was fascinating [00:36:00] because there's that initial like, whoa, whoa, government agency, public, you know, you know, and I said, well, but it's, it's not public. From there we're, we're actually looking at integrating it into a model like that. That's when this other organization started asking me questions, and I realized lots of people have lots of information that they need quick access to that would actually help them make decisions. And some of that data is really old, it's still important to them making decisions. And so I think that's kind of to your first part of the question. That's when we're gonna see more of a migration away from a VMware.

[00:36:36] Max Clark: It put you in interesting position.

[00:36:38] Dustin Young (EVP At Enzu): as a whole, actually.

[00:36:40] Max Clark: I mean, it puts you into, in, in an interesting position, right? Because fundamentally, you're an infrastructure provider, right? You're, you're helping company. Now, you know, the, the line of what that infrastructure is means lots of different things, right? But fundamentally, again, infrastructure provider.

But companies going through this process, you know, so now you've got, you've got a, a healthcare organization that's [00:37:00] migrated. They're migrated onto your infrastructure, they're in your cloud, right? I mean, cloud is just a term that just means, you know, they have some sort of API or web interface to orchestrate infrastructure, right?

So they're in your, your, they're in your privately delivered cloud for them, right? And then, you know, at some point. In the next six months to a year, it's inevitable. And they're gonna say, okay, how do we, how do we do AI with this? But then it shifts your role, right? Where you go from infrastructure provider to now like almost like, not software developer, but like business consultant.

Like, well, this is how you can integrate ai. And it's another piece, it's another tool. It's another building block, it's another widget, you know, in this stack that you have access to and this is how you gain access to it. And we're not gonna prescribe to you. Do you run Llama or do you run deep seek, or do you run whatever.

But like now you can start using it. Right. And, and that's interesting.

[00:37:53] Dustin Young (EVP At Enzu): Yeah. Yeah, those conversations come up and it's not that people are. [00:38:00] Ready to do it now. It's that part of their decision making process, uh, is am I choosing a vendor that I might be able to get there with? Right?

[00:38:11] Max Clark: How do you, um, we talked about equipment refresh for, for a heartbeat, you know, um. An Intel or a MD based server, you know, I basically assume it's gonna run for four years. GPUs are different animal today, right where, you know, as soon as the GPO becomes GP, as soon as the GP becomes available and you can actually have it, they're announcing new GPUs,

[00:38:37] Dustin Young (EVP At Enzu): Yeah,

[00:38:38] Max Clark: the old GPUs obsolete and worthless.

[00:38:42] Dustin Young (EVP At Enzu): and we're not, we're not quite actually seeing that accepted of the top four or five buyers in the world,

[00:38:48] Max Clark: Okay. So

[00:38:49] Dustin Young (EVP At Enzu): 75% of all the buying of GPUs currently. But

[00:38:52] Max Clark: yeah, I mean, there's still like,

[00:38:54] Dustin Young (EVP At Enzu): that at the enterprise level and down they are. Um. They're [00:39:00] a lot more cost conscious than just buying whatever Jensen says they're supposed to buy next.

[00:39:04] Max Clark: I mean, what it's called, I mean, 3000 watt per, you know, like. It's crazy. Um, well, because it, it, it creates like a, I mean the, I think the question turns into, um, contracting cycles and expectations, right? If you're going out and you're buying hardware to service a customer, how long is that customer gonna be in term with you on that hardware?

How do you as associate that hardware purchase, how is that hardware depreciating? What's it us, what's it life's usable life afterwards? How much do you have to charge them? I mean, this, you know,

[00:39:39] Dustin Young (EVP At Enzu): Sure.

[00:39:41] Max Clark: equipment leasing, right? Equipment leasing is just like, what is it worth at the end of it and how much do we have to charge you in the meantime, right?

And make money on top of it. Um.

[00:39:51] Dustin Young (EVP At Enzu): So we have a few like. Once we hit like a three-year term, right? So at a three-year term, if somebody wants a significant [00:40:00] refresh, then we refresh it. look at does that change their cost structure or not. Um, I mean, right now it might, um, just, just with some of the tariffs that potentially start tomorrow, um, they might have some cost increases in a refresh, but, um. depends on the parts that have to come from, I mean, there's a lot more to that. It's, it's not like these giant complete systems are gonna have these huge cost structures. Like we have lots of ways to not necessarily impact a significant amount of the infrastructure. Um, and then if somebody goes onto a five year, um, we guarantee the hardware, like at five years we guarantee a complete hardware refresh.

And instead of it being more optional and part of the thing is. The performance gain in hardware is enough that a client who might currently need, well, let's just use bare metal. It's a, you know, [00:41:00] is sitting over on a bare metal provider and they haven't had a hardware refresh in three to five years, come to you and say, I need 200 bare metal servers.

And, and here you go. And you say, well, here's what I can deliver now. And they say, oh, I need. Right? And, and it's, it's because the, the performance difference for the application. So they either gain a ton of performance and still buy a lot, or they don't really need to change, you know, they don't need to advance the performance anymore than they can actually reduce their overall footprint. And so they're reducing a lot of their cost structures, right? and so that's one of the things. And then in private cloud, right, if they're. Going onto a new CPU or they go their, their applications as the applications get updated are gonna perform better. Right. Their, the application will actually look smoother or faster or simpler, or, right, because those things have improved.

Right. Or storage performance has improved, right? I mean that's, [00:42:00] or what's next is network performance is improving. Finally. Like it, you know, we're making wild leaps in network right now. I, I. The, you know, one gig was a thing and then 10 gig was wow. And then a hundred gig, and then four oh oh gig and then 800 gig.

And it's, it's now it's all happening quickly. And then, you know, this little place in Palo Alto says, well, what if we just do it right on the chip? And you said, well, nobody can bend like that tightly. And they said, well, I think it can. And they did. And um, I watched the whole thing on it and I kept saying, you know, I was like, something is coming.

Like, we have a network change that's like 1.6 terabytes. is unheard of and it's not back cleaning and it's not, it's literally staying in the box like, and then it like there'll be a giant switch that controls it. I was shocked to see that get announced at Nvidia. I was like, oh, I watched an entire thing on how their former, she was like the CRO or whatever.

She went to this company. [00:43:00] From Nvidia. Right. And I watched this whole thing and I was like, oh wow, I can't believe how close they are. I had no idea they were so close that they were announcing it on the next chip set being delivered. And, and it's that, it's that it's, those are, that's why the hardware refreshes are becoming more important in a lot of ways.

'cause those are things people can take advantage of that actually change the way their environment works. Because now you're talking about delivering. Now if you're just delivering an ERP, uh, you know, there's things

[00:43:32] Max Clark: Web, web delivered application. Yeah.

[00:43:34] Dustin Young (EVP At Enzu): right? But if you're delivering something to your end user that has real time interaction, um, if you're delivering a, uh, if you're a trading application you're delivering trades and people are playing like this is these businesses, this, this stuff is hardware matters.

[00:43:53] Max Clark: Oh yeah, for sure.

[00:43:53] Dustin Young (EVP At Enzu): generation of hardware matters for them.

[00:43:56] Max Clark: Absolutely. It's.

[00:43:58] Dustin Young (EVP At Enzu): mean, if, if you don't recall, it was, it was [00:44:00] Goldman Sachs that spent all the money to develop a hundred gig sienna switch it. It wasn't a network provider. It was in fact, uh,

[00:44:12] Max Clark: Yeah,

[00:44:12] Dustin Young (EVP At Enzu): company.

[00:44:14] Max Clark: well my favorite example of that is the, um, the fixed RF network that runs between Chicago and New York. You know, the high frequency trading understands latency is important, right? It's. Significantly impactful to their business.

[00:44:30] Dustin Young (EVP At Enzu): Yep.

[00:44:30] Max Clark: And you know, fixed RF is faster than fiber optics, especially with the way the networks get built.

And, you know, roof rights in, in lower Manhattan are very expensive because everyone wants to put RF dishes on them. 'cause it's worth a lot of money to them. It's uh, you know, and meanwhile we go to other places in the country and. And tell a company, you know, we can put a fixed RF link in between them and they look at it like it's bad.

You know, like you don't understand the people that are actually using this to make money have all converted to this [00:45:00] platform. 'cause it's better. It's, it's hilarious. You know, like, um, I. You know, this, the equipment available and refresh cycle, and we're gonna see this in ai. I mean, and, and, and I was having this conversation the other day and I was talking about like data centers and data center densities around like AI and like, oh, everything's gonna go water cooled.

And the point that I made was, you know, you're gonna end up with, I. With water cooled specific infrastructure coming online and floor plates. This isn't generic data center design. That's gonna change because just like your Dell server has to support every enterprise known to mankind, you know, and, and, and permutations or Cisco, you know, you can say, well, there's other network manufacturers that do X better than Cisco.

And, and you say, well, this Cisco device has to support every use case. Reasonably well, right? And, and so anytime you get into specialization, you can be better, right? Yahoo is building data centers in the [00:46:00] design of bird coops and using, you know, um, I mean, I mean really, really simple stuff. Hot air rises, right?

So what do you do? You create a plenum and let the hot air exhaust out of the facility, which then, then creates. You know, a, a draft in the rest of the building to pull cold air through it. And you can, you know, and, and like you can make a efficient data center, but if you own the entire data center, you can pull that off.

'cause you control it end to end, you know?

[00:46:23] Dustin Young (EVP At Enzu): I think I can, I remember in, it was probably 2006, that was one of the first upgrades we made when the, the, the date, the density had shifted just enough that. cooling infrastructure wasn't working right. 'cause it's, those are all the, and so the fir the next thing you know, there's a bunch of people in, they're building, you know, these sheet metal plenums sitting over the top, and they're just big vacuums, big fan vacuums, like just to pull air. And, um, they hovered above them. They, you know, uh, and it lowered it enough. And then of course, at some point those don't keep up. [00:47:00] Right. There's,

[00:47:00] Max Clark: Yeah.

[00:47:01] Dustin Young (EVP At Enzu): I mean, I remember watching some of that and, and it was pretty fascinating. because it, it was, it seemed like such a simple, um,

[00:47:12] Max Clark: All, all the, all the rubber. All the plastic,

[00:47:14] Dustin Young (EVP At Enzu): the performance of the hardware significantly.

[00:47:16] Max Clark: yeah. Or all the plastic, um, you know, butcher, you know, like plenums that were going in everywhere. Like

[00:47:23] Dustin Young (EVP At Enzu): Yeah.

[00:47:24] Max Clark: it's, it's, uh, you know, everything that's old is new again. I mean, it's, it's, um.

[00:47:29] Dustin Young (EVP At Enzu): Yeah, I mean, what is hot out containment, but just pulling it down and out, generally speaking versus previous or now you, you know, you've got the rack pull through. But one of the things that we actually do, and we don't have to do this in a standard private cloud rack because just it's, there's never enough heat, but in some of the other designs, right, is we actually put sensors.

Then we're very mindful, like all the heavy compute stays at the bottom, right? Because you've got your cold out, comes in all your heavy compute at the bottom, and then, because by the time you get to the top it [00:48:00] just, you can put all the cold air you want, but especially around GPUs, this stuff is running hot enough,

[00:48:05] Max Clark: Yeah.

[00:48:05] Dustin Young (EVP At Enzu): That you don't, you're, if you go in, you're seeing either. Them figuring out other things, or you look at the, the, the density of the rack actually decreases as the height of the rack goes up. Right. And the only thing up there are switches, which can actually run in pretty tough environments. Right. They're not, so GPUs are sensitive Lowells,

[00:48:24] Max Clark: Yeah. No, it's, it's like a hot pocket. It's just, it's just magma, you know, like there's nothing, it's molten lava, you know, coming outta the back of that stuff. I mean, it's, it's.

[00:48:33] Dustin Young (EVP At Enzu): you, when we look at these, like we talked about before, these GPUs on private clouds where people are starting to talk about how do I get like a small private language, well, how do I get to my data and, and mine it and ask it questions and build a place where employees can just go in and say, where's the vacation schedule?

And it, they're not, you know, trying to sort SharePoint for a week, right? Um, it is, these are being done on L 40 S's. RTX [00:49:00] 40 90. Like they're not buying wild GPUs to do this because it's, it doesn't take that much. We're not talking about an enterprise scale, learning system. We're talking about a small scale system, and you're just, you're overlaying it and it has access to the data.

So it's, it doesn't go through the, it doesn't get trained the same way. It doesn't

[00:49:21] Max Clark: Yeah.

[00:49:22] Dustin Young (EVP At Enzu): challenges. It just, it stays private and so. The power increase is actually fairly small and it keeps the cost way down 'cause those things can be, you know, had for incredible prices. Um, we actually see more people now testing on like a one hundreds, again, L 40 Ss, V one hundreds. the other thing is people have started to understand GPUs have a purpose in what they're really good at, right? Um, and so just buying the latest and greatest might not be for your business. like if, if everything you do is deep learning, you're probably better off spending a lot of money on some V one hundreds [00:50:00] or V 100 Ss than you are buying the newest GPU 'cause that GPU is tried and true and tested and does incredible things in deep learning, right?

And so you're not reinventing the wheel every time.

[00:50:13] Max Clark: Yeah.

[00:50:14] Dustin Young (EVP At Enzu): And if you don't have, uh, Facebook money or starlink money, or if you don't have that money. It, you're, it's a tough place to live.

[00:50:27] Max Clark: If you're trying to buy that GPU at that quantity,

[00:50:30] Dustin Young (EVP At Enzu): Yeah. I mean, it's a, it's expensive and, and again, most of the time, RMA, like people, you need to buy enough over RMA is 30 ish percent still, it seems like on GPUs. Um, right. So if you build a small environment and it's down 30%, that's a huge impact to your business. Is so you have to buy enough not to be in that space.

Um, you know, uh, and the rental thing is nice. I think a lot of people are using it and they get to do [00:51:00] some dev, but again, um, they're at the mercy of that RMA 'cause they're not guaranteed that performance, they buy into it and then it's a pool of resources, right. So, we see some of that out there. So I think when we talk about, you know, the mid-market, this conversation. In, in adding any kind of AI to it is, does it give 'em a competitive advantage? Are they able, so does it improve the internal employee experience? Are they able to get to data that they're looking for without, you know, uh, being, being frustrated or saying, I can't find this, or are they constantly going into hrs office going, why can't I find my vacation?

What's, what's our schedule? What, what are our, a holiday schedule? Where is it? Right? Um, and then, uh, is it a competitive advantage to them? Are they able to mine their data and deliver something to their customers? Right. So it, it'll be interesting to see in healthcare, especially as we, we started, 'cause we're seeing more conversations. [00:52:00] If doctors, you know, a lot of times when they're doing treatment, it's, I've seen 50 of these and they're, it, it's in here, And they're like, what do I remember about this? And they're going through the recall and. If they could everything, all the notes, all the other doctors, and they went into this environment that was theirs, you know, not necessarily just, you know, public.

And they went in and said, how many times are a hospital seeing this? Oh, 600 cases of these symptoms. Okay, let me start. And they could narrow it down pretty quickly and, and, 'cause you can talk to it pretty naturally and get most everything you want. It's better to actually know how to prompt, but you can talk to it pretty naturally. Um. could do that, could they, could they diagnose people more correctly the first time versus some of the repeat comeback where people are? 'cause the cost of healthcare is through the roof. the number of [00:53:00] people going is at an all time high. Um, like there's all this stuff that has happened, you know, uh, in their space. And could they use those tools to deliver a better experience for patients? And I think that's why we're seeing. In this segment in size, them going, how do we integrate something that is gonna be GPUs on a private cloud and or they go to a containerized model deliver GPUs and containers for that, those applications, 'cause it's gonna need to be an app, it's gonna be something they open, they type they go, and it needs to be simple to use. So.

[00:53:36] Max Clark: Uh, the. The key phrase that you put there was like, um, you know, you talk about employee experience and then you talk about customer experience, and then you talk about driving down costs, you know, to operate through this, right? Like, you know, very large touch points, funny to talk about at this stage of this, right?

But that is [00:54:00] like, you know, infrastructure's cool and fun and all, but then you start talking about like what actually makes. Meaningful changes to an organization, right? Are your employees happy? Can they do their jobs? Can they work better? You know, can they get to an outcome faster? Right? Can you train them quicker?

You know, can you share knowledge more efficiently? Can you impact the, you know, patient experience? Can you give them a better health outcome? Can you find things before it happens? Can you, you know, like, I mean, you go through like all these examples and it just starts piling up on top of each other. For really quickly.

[00:54:35] Dustin Young (EVP At Enzu): are you seeing a trend? I mean, I think that's a lot of businesses, there's a trend happening and they don't, they can't see it, right? 'cause there's so many different people that might touch it, it isn't until one person is standing in a room and listening to everybody talk and going, well folks, I think we need to stop for a sec.

I think there's a trend here In your information,

[00:54:55] Max Clark: Mm-hmm.

[00:54:55] Dustin Young (EVP At Enzu): months can pass. Whereas if something's being put into a tool and you're saying [00:55:00] watch, you tell it just to watch for trends every day, it's like, Hey, you saw 30 of these today. Oh. That's weird. We shouldn't have saw 30 of those. Like that's, Hey folks, we have a flu outbreak in our area.

[00:55:12] Max Clark: Right.

[00:55:13] Dustin Young (EVP At Enzu): and it isn't, you know, a week or two in it's day two, and it's like, Hey, we've seen enough of these all of a sudden that we should pay

[00:55:20] Max Clark: We know

[00:55:20] Dustin Young (EVP At Enzu): right?

[00:55:21] Max Clark: we know.

[00:55:22] Dustin Young (EVP At Enzu): this is all about, we talk about you gotta deliver outcomes or you're wasting your money on tools, right? Like that's for any business. If they can't deliver an outcome, they're just buying something for the sake of having it. What I hope to see, like for healthcare, any of these customers we're talking to, is not just to get 'em, like it's important to get a, to make a a cost effective decision. It's important. Is VMware too expensive now? Are you, is it time for you to find something else? But then what are the outcomes after that?

What are you gonna do with this infrastructure that's different than you're doing today? Um, because for a lot of people, they're just ERP sits there, it runs and the HR software sits there, it runs and they're [00:56:00] running around and they're fixing laptops and they're fixing machines and Um, but what they're not doing for a lot of it, and, and you brought it up, is, um, they're not delivering outcomes.

That equipment isn't delivering value. It's, it's a cost and it's a necessity, but they're not converting it to a value. And so this might be the first time we see value conversion. They're able to generate knowledge out of their intellectual property database. So those conversations are happening more and more.

Where that goes, you have to be seen, but they're, we get, I get asked that a lot more than ever before.

[00:56:39] Max Clark: Dustin, this is fantastic. Thank you very much. Love. I love, I love digging into this. It's always, I always walk away from talking to you with something new, which is great. Appreciate the time.

[00:56:49] Dustin Young (EVP At Enzu): I love these. They're fun.

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