2875: Mastering Sustainable Multi-Cloud Strategies With Nutanix

[00:00:00] How often do we pause to consider the real costs and benefits behind the cloud services

[00:00:07] that we use every day? Well today we're going to go beyond the surface with Steen Dalgas

[00:00:13] and he's a cloud economist at Nutanix. We're going to unravel the intricacy of cloud economics

[00:00:20] together today and talk about it in language that everyone can understand. Because we're

[00:00:25] going to dive into how Nutanix roots in Google's innovative infrastructure technology are actually

[00:00:31] revolutionising cloud cost efficiency for businesses and also shed light on the critical

[00:00:36] role of environmental, social and governance factors. Yes, ESG. Those factors are becoming

[00:00:43] so important in today's IT decisions and I want to dig a little bit deeper on that

[00:00:48] and learn more about how Nutanix is helping lead the charge towards sustainable cloud

[00:00:54] solutions. With the rise of hybrid and multi-cloud environments, I'm hoping we can also discuss

[00:01:00] the evolving challenges and opportunities that all these platforms present. So yes,

[00:01:05] I cordially invite you to join me as we uncover the economic and environmental layers

[00:01:11] of cloud technology that are shaping the future of IT. This is something I don't think

[00:01:16] we talk about enough. Now before I get today's guests on, it's time for me to mention

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[00:02:16] sophistication but now it's time to get today's guests on. So buckle up and hold on tight as I

[00:02:22] beam your ears all the way to the UK where you can sit down and enjoy a great conversation

[00:02:27] about all this and much more. So a massive warm welcome to the show Steve. Can you tell

[00:02:33] everyone listening a little about who you are and what you do? Sure thanks very much

[00:02:39] so yeah my name is Steve Dalgas. I have a great job title cloud economist and it wasn't a job

[00:02:46] that I dreamed about doing when I was a kid but I'm absolutely it is a dream job for me now.

[00:02:51] So my background is a little bit unusual for somebody who's front of house in an IT vendor.

[00:02:56] I come from an accounting background, so I was a chartered accountant. I then got into the

[00:03:02] IT asset finance industry at a very large multinational. So did that for about 20 years

[00:03:09] until that job and that whole part of the business got eliminated. So I was on the back

[00:03:15] of the Enron accounting scandal sort of made so the way that IT companies used to go to market

[00:03:20] in the 90s was they would sell their hardware and software solutions with a finance bundle

[00:03:27] and that would be an operating lease. So I was responsible for that. So packaging up software

[00:03:34] and services and hardware as an operating lease and then because Enron sort of got made people

[00:03:42] aware that actually operating leasing was really a form of financial cheating it got outlawed in

[00:03:47] 2016. I can remember going to a chartered account conference which doesn't sound very

[00:03:54] exciting but I can still remember the day to day. What I went to is I realized that my job was

[00:03:59] going to disappear and so what I did was I then had to look for something else to do and rather

[00:04:05] luckily I came across Nutanix a short period later and when I joined Nutanix it was a

[00:04:11] sort of unique opportunity because there was my boss at the time Andrew Brindid who's now

[00:04:15] our chief revenue officer said to me, Steen we don't quite know what we need you to do

[00:04:20] go and talk to our customers and so I was actually given the opportunity

[00:04:24] to basically choose my own role and that's how we came up with the cloud economist.

[00:04:29] So that's what I do now Neil. Wow what an incredible story and a great job title too.

[00:04:34] I'd love to see you at passport control when you say the words cloud economist.

[00:04:40] Incredibly cool title isn't it? Yeah it's brilliant. I'd like to say I invented it. We

[00:04:45] came across on the internet there were a couple of cloud economists before us but what I keep

[00:04:50] saying to them is I've got teenage kids, the jobs there's all these new cool job titles coming

[00:04:55] out prompt engineers and so on and so exciting times for our kids when they get into the

[00:05:01] world of work there's going to be a whole bunch of new jobs out there and I'll talk

[00:05:05] to you a little bit about what a cloud economist actually does, what it means surely.

[00:05:09] No problem at all. I'm sure you get some cool dad points with that job title too and

[00:05:14] one of the reasons I was excited to get you on the podcast today is Nutanix has been

[00:05:18] recognised as somewhat of a disruptor in the tech industry especially in

[00:05:22] hyper-converged infrastructure or HCI. So I've got to ask how does this foundational technology

[00:05:29] contribute to advancing cloud economics and IT sustainability because I feel there's a big

[00:05:35] story here. There absolutely is and I remember because I came from like the legacy world of

[00:05:42] IT, IT vendors, sort of like the proprietary world and when the concept of Nutanix was

[00:05:51] explained to me I was absolutely blown away and really what sort of brought it alive to me was

[00:05:56] the sort of origin story. So if you think about like superheroes they have their origin

[00:06:00] story, the origin story of Nutanix so where we actually came from. So if you understand that

[00:06:05] then you start to understand a little bit more about what we were really about

[00:06:09] and where we came from was if you go back to early 2000s so as well that sort of internet was

[00:06:16] just sort of in a sort of nascent form the dominant search engineer was Yahoo and there

[00:06:23] you had Google coming along saying that yeah we'd like to you know knock you off your perch

[00:06:27] Yahoo we think we could come up with something a lot better and what they did was they did

[00:06:32] some sort of corporate sort of discovery to find out how Yahoo was running its IT and

[00:06:38] what Yahoo was doing was it was running its search engines using what we call traditional

[00:06:43] IT architecture which is where you have your servers and then you have separate storage array

[00:06:49] and they were using NetApp filers for their storage and then you connect the two with a

[00:06:54] storage area network. So this was the traditional three-tier architecture now

[00:06:58] the problem with that was they effectively had like a little cluster for each part of the

[00:07:02] world using the internet you had like your own little cluster and what it meant was only

[00:07:08] a few of those clusters would sort of list up at any one time as different parts of the world

[00:07:12] were using the internet so it was an incredibly inefficient way to run infrastructure because

[00:07:18] you're only using 10% of the resources at any one time but you're having to pay for 100%.

[00:07:24] So the folks at Google took a huge risk and they said well we need to go and architecture

[00:07:29] something completely different and they spent four years coming up with what's now called

[00:07:34] the Google file system which is the original architecture which is now called web scale used

[00:07:39] by all of the major hyperscalers and what they did was so if they took an x86 server

[00:07:47] and they put the storage into the server so this is the sort of foundational hyperconverged

[00:07:52] infrastructure and eliminated the SAN from the architecture and so the idea was you could

[00:07:59] present the storage as a single pool so you no longer did you have to have individual clusters

[00:08:04] you could just have one super cluster and if you needed more capacity it could just scale out

[00:08:10] linearly and so what I meant was from a cost point of view it was dramatically cheaper

[00:08:16] but then what they did was even smarter was they were those sort of leader

[00:08:19] the sort of early adapters of the software defined approach to running data center infrastructure

[00:08:25] and so they brought a high level of automation and so what they realized was if you were running

[00:08:30] IT the way that Yahoo is doing so as you scaled up you're going to need more and more

[00:08:35] storage administrators and so pretty soon you'd find if you really scale there's not going

[00:08:40] to be enough storage administrators in the world to run all the IT that you needed to

[00:08:44] run the public cloud and so but by taking this approach they needed dramatically fewer

[00:08:53] people to run their infrastructure and there was an analyst for storage mojo did a really great

[00:08:58] write-up on this whole story and they worked out that it was not so google's IT was about

[00:09:06] nine times cheaper so it's about nine times cheaper to run the infrastructures in Google

[00:09:10] than Yahoo so from a cost point of view they gave them a massive cost competitive advantage

[00:09:17] but they also had a great advantage in terms of revenue because they could scale linearly

[00:09:22] it was really easy to add capacity easy to add new software features so they were able to

[00:09:28] respond more quickly to the market and bring in new features and suck in more advertising dollars

[00:09:34] so they also won in terms of the innovation war as well yeah and so that so what happened

[00:09:39] was Google absolutely smashed the competition Yahoo ended up being bought out and is now

[00:09:45] a subsidiary of a of another conglomerate so they tucked away it's still around Yahoo

[00:09:50] but it's you know Google was the massive winner there and so the big takeaway from that is that

[00:09:55] if you get the right IT platform it can be a massive advantage from a competitive point of

[00:10:01] view now how does that all relate to Nutanix that great story well the people who built

[00:10:09] this Google file system said well we can take this hyper converged infrastructure approach

[00:10:14] to the enterprise market and so two of those data scientists got together with our founder CEO Diraj

[00:10:21] who came from Oracle to create Nutanix so Nutanix is that same web scale architecture

[00:10:29] that they were that Google successfully used but you can now run your private cloud the same

[00:10:34] way that the hyperscalers run there so that's where we've come from is this whole destructive

[00:10:38] approach and if you get the right platform it can deliver some incredible economics for customers

[00:10:44] so that's where we've come from incredibly cool isn't it always we're talking about cloud

[00:10:49] economist a few moments ago it is a relatively new area but critical in today's digital

[00:10:55] landscape so can you tell me a bit more about the role running importance of cloud

[00:10:59] economists in helping businesses maybe navigate some of these complexities that we're talking

[00:11:04] about around cloud deploy deployments and sustainability so my background was when I

[00:11:10] was in the asset finance world I did I used to do a lot of business cases and those business

[00:11:15] cases would be ROI type business cases and that and that's because at the time the sort

[00:11:23] of dominant way that businesses were run from a financial perspective was shareholder value

[00:11:30] and shareholder value is a sort of milson friedman sort of term and he published an article

[00:11:35] about this and so that and literally what it means is can I save the company money and it's

[00:11:41] purely focused on optimizing the profitability for the shareholder but what we've seen is

[00:11:48] so in the last 10 years there's a growth in stakeholder value and stakeholder value means you

[00:11:54] need to look at things that are so profit is important but there's also other things that

[00:12:00] are really important as well as a recognition around risk that risk is really important

[00:12:04] and driving innovation and these are all aligned to some of the goals that cloud is trying to

[00:12:08] solve so and the best way to measure that is tco and so and as a disruptor so we

[00:12:17] recognized in nutanix was that really we needed to make tco key part of how we engage

[00:12:22] with our customers because what we were trying to do was disrupt the status quo and bias so

[00:12:28] there's a huge amount of bias in companies and you know what we find is like that's customers

[00:12:34] either will think that native cloud is the right way to go or their love with storage or

[00:12:40] they let you know they've got their own personal biases their own opinions

[00:12:44] and what we're trying to do with the tco is really come in and challenge that by it by and

[00:12:49] so what cloud economists will do is we will so i'll create a business case and i'll compare

[00:12:55] the different choices and i'll break it from an accounting point of view we'll look at it

[00:12:59] we'll break the business case into your capex opex over time so how does the solution scale

[00:13:06] with growth we model that out and and what we try and do is we translate features and

[00:13:11] benefits and we sort of we don't we sort of say yes it's good to sort of state those

[00:13:16] the techies love their features and benefits but what does that actually mean from a business

[00:13:20] point of view so what i'm trying to do is translate those features and benefits into

[00:13:24] financial value that can be measured and so what we try and do is we measure the value

[00:13:30] using and the best way to measure it is if i can get a third party invoice or a quote

[00:13:35] if i don't have those then what i'll try to do is get estimates from let's say other

[00:13:41] customers who've had who've seen benefits i try and quantify those and bring those into the

[00:13:46] business case as well and so by by delivering a tco as part of our engagement with a vendor

[00:13:54] we end up with a much more valuable engagement because that vendor that that customer will then

[00:14:00] really understand well how's this solution going to uh going to help my company and uh

[00:14:06] so you know we say great pride and building out an accurate trustworthy tco and then what we do

[00:14:15] with customers is we also do look backs so if they've made the investment into Nutanix

[00:14:20] and we sort of have built this business case we come back a couple of years later and we

[00:14:24] say well did we deliver on what we said we would and those look backs can be incredibly

[00:14:30] illuminating so to give you a couple of examples of one so one we did was with a systems integrator

[00:14:37] and what they had done was they were so for them what was really important was the double

[00:14:41] of automation so out of the task of running it you can imagine what a systems integrator is

[00:14:47] trying to do is run someone's it more efficiently than they could do it themselves

[00:14:52] so for them they what they had done was they'd measured out every single business process

[00:14:57] involved in running it and what we said was what we would automate and we came up with a figure

[00:15:02] that we would automate essentially to those and that would translate into fewer people needed

[00:15:08] to run it and when we came back we and we validated that a couple of years later it was

[00:15:14] you know did we deliver on what we said we would and you know generally what we try to do

[00:15:19] is we try to be conservative in the tcos and then under promising and over delivering

[00:15:24] be incredibly illuminating with another customer financial services customer and what we did there

[00:15:28] was they had so they had a Nutanix virtualizer state and then they had a physical state

[00:15:35] and what we did was we looked at what's what position that Nutanix virtualizer state was

[00:15:41] and we went through and looked at the so was the hardware up to date was the software

[00:15:46] versions all the operating systems all up to date and then we compare that with a physical

[00:15:51] environment and what it sort of demonstrated to us which was all red was it sort of helped

[00:15:56] to demonstrate well that you know we promised that if you have a Nutanix environment it's very

[00:16:01] simple to manage it's easy to keep up to date you need far less people to manage it and so in

[00:16:07] this particular customer where they had a Nutanix environment and non-Nutanix environment and we

[00:16:12] could do this look back it gave us like a sort of like most like a perfect scientific

[00:16:16] experiment where you could see the results and you could see that the nightmare that was

[00:16:20] managing physical infrastructure versus managing our sort of virtualized highly

[00:16:25] automated Nutanix estate so what we're trying to do very simply is provide data points to prove

[00:16:32] so if we're making a promise or a statement can we back that up with data and so

[00:16:37] that's the cloud economist job. And it's so refreshing to hear you talking about

[00:16:42] under promising and over delivering in almost every area of life right now it seems to be

[00:16:47] the opposite in many situations so it's great to hear that.

[00:16:50] And also Neil we're in like a post-truth world so it's like so can you actually provide the

[00:16:57] data and evidence is it you know and I think that's really important in today's world as

[00:17:01] well so. Yeah 100% with you and just to further bring to life everything that you're

[00:17:06] talking about here especially for business leaders listening around the world and this

[00:17:11] significant shift that we're seeing towards hybrid multi-cloud architectures is there anything

[00:17:16] you can share around how you assist organizations in helping balance that need for things like

[00:17:21] cost efficiency performance sustainability into their cloud strategies because again it can feel

[00:17:26] for a lot of people listening that they're spinning a lot of plates and it's a huge

[00:17:30] balancing act isn't it? It's a massive balancing act and the problem is you're so

[00:17:35] so you're so busy in the doing you're not you're not taking the opportunity to sort of

[00:17:41] step away and actually ask yourself are you actually going in the right direction

[00:17:47] and if I was to summarize I say most of our customers are in this sort of transition period

[00:17:52] where they're going from what we call the old world this old sort of legacy world of IT

[00:17:58] and they're moving to this sort of new promised land of cloud and they're and they've

[00:18:03] gone from the old world you know it was not very inefficient but it was pretty stable

[00:18:08] and the world they're heading towards is going to be stable but they're in this sort of

[00:18:12] unstable period and so if I was to say like the old world of IT it was all about is a very

[00:18:18] simple world it was CIO's job was to run all the apps and make sure that they were on

[00:18:24] so keeping the lights on and to try and do it relatively cheaply whereas now the role of

[00:18:30] IT has become strategic to the business so IT is responsible for delivering and helping

[00:18:37] to drive innovation in the business trying to reduce cost not just in IT but reducing

[00:18:42] cost across the business and then I would say this is the most important is to future

[00:18:49] prove the business and so for example we've just gone through the pandemic where you have

[00:18:53] like a you know so really you know terrible about trust upon businesses that they had to

[00:18:58] respond to so we're in a we've gone from like a 20 25 year period of relatively calm

[00:19:05] to we're now in I'd say a period of massive uncertainty we've got all sorts of threats

[00:19:10] geopolitical instabilities and the climate change there's a huge amount of threats out

[00:19:16] there so IT is being asked to sort of future-proof the business so we can react against whatever's

[00:19:21] thrown at us and like I'm gonna throw in another like risk so which Nutanix has been

[00:19:27] shouting about which is vendor risk so if you're too closely aligned to a vendor

[00:19:32] and what we've been hearing from a lot of our sort of customers is that they have been too

[00:19:38] reliant on one particular vendor in the virtualization space which is our direct competitor

[00:19:43] and now that competitor has been acquired and the pricing models have changed so they found

[00:19:48] themselves now in positions where they're having to pay a lot more for their virtualization

[00:19:53] software than when they were previously so there's lots of challenges out there so

[00:19:58] and so what Nutanix has been building out so for the last 10 years we made a bet so this is our

[00:20:04] founder Diraj was that the world was going to become multi-cloud and that customers were

[00:20:11] going to go towards a world where you weren't just going to have be one public cloud and

[00:20:15] that was going to be it but actually it was going to be much more messy than that you're

[00:20:19] going to have an edge cloud private cloud and that actually the business would need

[00:20:24] multiple different clouds so you would because of and be driven by business requirements so

[00:20:30] hopefully if you're a data analytics you might want Google cloud or if you might want certain

[00:20:34] features available in AWS cloud or Azure cloud depending on the application that you were

[00:20:41] the business particularly needed so businesses were going to end up

[00:20:44] multi-cloud by accident and this complexity would need management so what we've been

[00:20:50] doing is working in Nutanix is to build a hybrid genuine hybrid multi-cloud model and by

[00:20:58] multi-cloud and this is the uniqueness of Nutanix is what we mean is you run all of

[00:21:04] your clouds wherever they are with exactly the same consistent operating model and the

[00:21:10] same consistent set of data services so that's the sort of what we've been building out to

[00:21:16] help customers and what and as part of that is to make it easy and so with I've talked about

[00:21:22] that sort of journey that their customers are on moving from the old world to the new cloud

[00:21:27] world so how can we help accelerate that journey to make it quicker less risky and

[00:21:34] addressing the stability piece because whilst you're in that transition phase you're at

[00:21:39] risk of things like you know from a security point of view you're exposed so how can we

[00:21:44] and there's and regulation challenges so we're seeing for example the Dora regulation in Europe

[00:21:50] where customers have to sort of demonstrate their ability not to be locked into cloud vendors so

[00:21:55] so if I'm supposed to summarize what we've been trying to do is build out this hybrid

[00:21:59] multi-cloud platform and that can make this whole world simple to give customers choice so

[00:22:08] you can choose the right cloud for the right business reason and then to provide this

[00:22:13] consistent set of data services because your data is going to be your crown jewels for your

[00:22:17] organization so how can we help you protect that data and be able to move the data where

[00:22:24] you need to in order to maintain your competitiveness so that's the sort of

[00:22:29] Nutanix story around multi-cloud Neil. Fantastic and another big topic I'd love to

[00:22:35] explore with you today especially in a world where ESG scores are increasingly important to

[00:22:40] business leaders the pursuit for things like net zero emissions they require dire action

[00:22:46] rather than just reliance on offsetting so how do you at Nutanix approach cloud solutions and

[00:22:53] IT sustainability in that how do you align with goals like this because it must be

[00:22:57] something that you're increasingly talking with your customers about and are there any

[00:23:01] any particular initiatives that you can share around this?

[00:23:05] So if I start off if I answer that question in terms of well what are we doing ourselves

[00:23:11] internally and then also what's happening in the market so I touched briefly on the sort of

[00:23:16] change from shareholder value focus to stakeholder value focus so what happened was

[00:23:24] it was really sort of just to give you some sort of you know and listeners historical

[00:23:28] context so around sort of like 2019-2020 there was a big change in the shareholder investor

[00:23:37] community in terms of like there's been a sort of wrestling about what's the best way

[00:23:42] for organizations to run themselves and it's actually because my accountancy background

[00:23:47] obviously all over this I really sort of got the topic and there was a view that

[00:23:52] the way traditional way that companies were reporting their financial results was not

[00:23:57] giving a true proper reflection on the business and the business risks so if you're just

[00:24:02] reporting pure numbers profit loss you're not telling a full story and this is seeing the

[00:24:09] rise of ESG so environmental social and governance and so what that means is it's really that

[00:24:16] what the investor community wanted was to understand more about the businesses so they

[00:24:21] needed to report more data in a more consistent way and actually there's a recognition that so

[00:24:27] this is like from a risk point of view that environmental and social performance and governance

[00:24:34] really matter because they can they can so highlight potential risk factors that could

[00:24:40] come in hit companies down the line and so the major investor community started to get

[00:24:46] really get behind this and this has now become the predominant way that in that companies are

[00:24:50] investing and there's a recognition that the whole sort of energy transition was going to become a

[00:24:55] massive issue and so having watched this is you know sort of be aware of this it was really

[00:25:02] so how was Nutanix going to respond to this sort of big change in the market because what we

[00:25:06] see is that this is going to be a change that's going to be here for at least the next 20

[00:25:10] years we're going through this energy transition and then we're also facing this mass this

[00:25:16] pending crisis around climate and IT is right at the center of this so one of the facts I mean

[00:25:24] the more I sort of dug into this I was shocked for example I was you know I went through a

[00:25:29] period of not flying Neil because I was worried about my carbon footprint or flying a lot less

[00:25:35] and I then discovered well actually the IT industry was was emitting at least as much

[00:25:41] CO2 emissions as the airline industry so like you know shock straight away so we're actually part of

[00:25:47] the you know massive part of the problem and then if you look at you know with AI coming

[00:25:51] downstream it was just going to get worse and worse so we were you know so what so it's just

[00:25:57] like really sort of highlight we needed to do something well I mean the good news is like

[00:26:01] what attracted me to Nutanix was or fundamentally what you kind of problems that

[00:26:05] Nutanix was solving which is you know when I talked about the Google story we were

[00:26:10] optimizing resources we were simplifying so all of that was fundamentally cutting down the number

[00:26:16] the amount of emissions were making IT more efficient consuming less energy so there I felt

[00:26:23] it was a really positive story and what we did as a company was we decided to to drink our own

[00:26:29] Kool-Aid and we went through a project to move all of Nutanix onto our own infrastructure

[00:26:37] platform and we have consolidated mainly into two data centers actually so if we look at the

[00:26:45] energy that we are emitting as a company so around 78 percent of our total direct

[00:26:51] electricity consumed is actually comes from our data centers so within our particular organization

[00:26:59] the data centers are the biggest part of that you know from the scope one and two emissions

[00:27:05] which are the easiest to measure it's the biggest part of what we're

[00:27:10] of our carbon emissions and so what we did was we tried to make that as efficient as possible

[00:27:16] and what we realized was we couldn't do it by ourselves we had to partner and so we partnered

[00:27:21] firstly with a data center company to help optimize from an energy and water perspective

[00:27:29] because water is a huge part so IT uses a huge amount of water for cooling to run the air

[00:27:39] conditions because IT because data servers only run so if it gets too hot above 29 degrees and

[00:27:46] then servers tend to switch off which is not very good for customers because they start to

[00:27:51] fail so they only so they have to be cooled down to a certain temperature and so we

[00:27:57] partnered and we partnered with a great data center company and what we also did was we

[00:28:02] partnered with a company called N0 and this is really quite groundbreaking what N0 would do was

[00:28:10] help us understand what energy was available in the grid so that we could intelligently

[00:28:18] use our and run our IT based on optimizing when there was most renewables available in the

[00:28:25] grid and so we've been able to get our emissions down through that through using software

[00:28:31] intelligence to optimize how we are consuming our own energy so now I think based on our last

[00:28:41] report I think it's around three quarters of our energy direct energy consumption was coming

[00:28:46] from a genuinely renewables base so we were looking at when renewables were available in the

[00:28:50] grid and targeting our processing around those time periods to make sure we're maximizing some

[00:28:58] renewables so we've have drunk our own Kool-Aid internally now what we would say is that's a

[00:29:03] start and we want to get better and it's a journey and each year we've got better and

[00:29:08] we're becoming more transparent in terms of how we report so that's what we've been doing

[00:29:14] ourselves you know does that help?

[00:29:17] Yeah it really does and what I found particularly interesting there as well is I think it was the

[00:29:22] 2022 UN climate panel they reported highlights the well their report highlighted the urgent

[00:29:28] need for global cooperation and significant changes to combat climate change and as you were

[00:29:33] talking there your own personal story about the difference you can make by I don't know

[00:29:37] how many cars you've got how much air travel you make and as a result sustainability

[00:29:42] is such a huge imperative but one of the things that we don't always talk about is

[00:29:46] things like AI and crypto and IT infrastructure there's a huge need for green tech out there

[00:29:52] isn't it? There is absolutely and so what I think so the next thing is really is

[00:29:59] there needs to be an industry way of tackling this problem so it can't be

[00:30:05] Nutanix we're an ecosystem player and I think what was clear to me is as I've gone

[00:30:11] into the topic it's about an ecosystem all coming together so and all being as that actually if

[00:30:20] you read our latest ESG report our CEO Rajiv talks about personal responsibility but also you

[00:30:27] know we all have to be personally responsible but and that's not just in our personal lives

[00:30:32] but in what we do in our companies and how we take treat this topic how we engage with our

[00:30:38] customers how we bring it bring this mindset to how we go about achieving our business goals

[00:30:46] for the year we bring this mindset to how we go to work which I absolutely love that so

[00:30:52] and so from an industry perspective it's about working together in an ecosystem so what I what

[00:30:58] that means is so from a Nutanix point of view so we're the software layer so what we need

[00:31:04] is we need to work with efficient hardware or cloud companies who are providing that

[00:31:08] infrastructure layer we need to work with partners in the organization so that this will

[00:31:13] be resellers such as you know the computer centers softcats cdw's like the big resellers

[00:31:18] we have in the uk who we partner with and we know are take this very seriously

[00:31:24] and our customers as well need to bring their own you know you know bring their best game to

[00:31:29] the town because we can give the most sustainable solution possible in the market

[00:31:34] but they need to use it in the right sort of way so I described that as being

[00:31:38] you know I've got a car and I try I always have the miles per gallon set and I'm trying to

[00:31:43] optimize that in terms of how I drive so you can so customers need to set things up in the

[00:31:48] right way to optimize from a sustainability point of view so we all have to work together

[00:31:53] and there's a great motivational video that Richard Curtis did which is a great Al Pacino

[00:31:58] speech about inches and I don't know if you've a chance to see that Neil but it's phenomenal

[00:32:03] it's like a sort of five-minute motivational speech about that we really all need to get our act

[00:32:08] together and so the tech uk do a sort of industry gathering around sustainability

[00:32:14] and those sorts of events they matter and what we all need to do is be committed to

[00:32:19] transparency of data and being honest about our data and I'll give you an example of

[00:32:26] a bug bear that I've got yeah okay to raise a bug bear yeah absolutely that's what we're here

[00:32:31] for okay so if we look at the car industry so the car industry have worked out that embedded

[00:32:38] emissions are huge and these are the emissions when you buy a new car it comes with so the

[00:32:46] emissions that are required in the manufacturing process are very high and then it gets has to

[00:32:51] be shipped around the world and I worked out that actually if you were

[00:32:58] and there's analysis has done that if you're buying an electric car it was not break even

[00:33:03] from an emissions point of view to like year seven or eight what because of the impact of

[00:33:08] the embedded emissions now the data I've seen from IT harbor manufacturers around embedded

[00:33:14] emissions is that it's only 10 to 11 percent of the life cycle whereas the car industry are

[00:33:20] saying it's between 40 to 50 percent of the total life cycle are in that manufacturing process

[00:33:26] now this is where like I'm a sort of data driven and biased point of view but I just frankly

[00:33:31] don't believe that 10 to 11 figure yeah it's been accurate I just don't I don't believe it

[00:33:36] so I think what we need our IT manufacture hardware manufacturers to be honest about this

[00:33:44] and I do think there is a I've seen so one of the cloud vendors and some of the

[00:33:48] cloud vendors what they're doing is looking to extend out the lifespan of IT so it's clearly

[00:33:55] if you're in the business of selling IT hardware and if you're extending out the life that's not

[00:34:00] great for business yeah okay but if you really are genuine genuine want they want to solve

[00:34:06] this problem then extending out the life is the answer and looking at reusing parts where

[00:34:13] parts make sense because if you reuse parts they come with zero better emissions or very little so

[00:34:20] there needs to be I think a rethink on the hardware side of the industry

[00:34:25] absolutely and not just the hardware that I was reading I think it was last month that boom of

[00:34:31] AI that everyone's excited about at the moment Microsoft have used something like 22 billion

[00:34:36] liters of water in 2022 to power AI and Google 7 billion and that number is just going

[00:34:42] to keep increasing but on the kind of difference that we can make and you can help make for your

[00:34:48] clients as well how do you enable your customers achieve their sustainability goals

[00:34:53] particularly in terms of reducing co2 emissions and optimizing their energy use is there anything

[00:34:58] you can share around that and just for any business leader listening to that yeah so I

[00:35:03] spent a lot of time on this and again like just trying to I was just trying to break it

[00:35:07] all down so if I break down the elements of so what so from an IT infrastructure point of

[00:35:13] view what contributes to emissions so you've got so from the hardware side

[00:35:19] so I've talked about embedded emissions and then you have then you have the emissions when you're

[00:35:25] running equipment in a data center and the and you have the there's the emissions around

[00:35:31] the data center itself and then there's the emissions in the rack so what I've uncovered is

[00:35:36] we've got a big so the data center itself is a massive part because what I talked about was

[00:35:44] the need to cool IT yeah and so you have to run these big air conditioning units and so the

[00:35:51] challenge there is that in sort of like either cooling it uses a lot of electricity

[00:35:55] and the more inefficient the data center the more electricity you need to cool and if you're

[00:36:01] running an old data center so and the way that we measure it is with is something called PUE so

[00:36:08] power utility effect and so the industry average for like a decent vendor is about 1.5

[00:36:16] so this is like so what that means is if I'm if I'm have emitting one kilowatt of kilowatt

[00:36:24] electricity at the rack I need another 50% on top to cool it okay in astounding data center but

[00:36:36] if you've got a very old data center you're using a server room that PUE might be three

[00:36:42] four or five and so what that means is that you're having to incur a lot more electricity

[00:36:47] to cool that because you're running an inefficient data center and we have got a ton of these

[00:36:53] inefficient data centers running around in the UK especially in public sector so I quick when I

[00:37:00] quickly worked out was unless you're one of the very few large corporates who've got you know

[00:37:06] huge budgets to run around run your own data center it's absolute madness to run your own

[00:37:12] data center so so straight away if you want to do something plan to exit the data center

[00:37:20] as your own data center as soon as possible and then the answer really should be either

[00:37:26] co-location which is using so this is which is what I think Nutanix went down to we partnered

[00:37:31] with a data center expert or public cloud so using a public cloud or a bare metal provider

[00:37:38] who's a specialist and that has invested in a tier for highest efficiency data center

[00:37:46] because that can make a really big impact so what these titles can also help is so we have

[00:37:52] a very small form factor which I think I described to you because we're just putting

[00:37:58] the infrastructure into an x86 server so you no longer need a separate storage array so we've

[00:38:03] been able to shrink the footprint so what you'll see is you'll see a much lower consumption

[00:38:09] of electricity at the rack so what I talked about was the need to have you know cooling

[00:38:16] efficiency in the data center but you also need to have efficiency at the rack as well

[00:38:22] and then what we also did was we then went out and extended further by looking at well

[00:38:26] how could we optimize by taking advantage of energy at the grid and that's where if you're

[00:38:31] in partnership with a co-location provider you can do that and because Nutanix is

[00:38:37] we're operating at scale you know we can do that but what I would say is probably

[00:38:41] it's probably this is probably not your business which is why I think sticking

[00:38:46] utilizing public clouds and giving it to specialist you know specialists it probably

[00:38:51] makes a lot of sense so I think accelerating going into public cloud makes sense however

[00:38:59] there's others I just want to sort of highlight there's another sort of like flying the wind

[00:39:03] here which is the grid so understanding the grid impact in terms of sustainability now

[00:39:10] there's if we look at a country-wide level so different countries use different amounts

[00:39:15] of renewables energy and the more renewables you use the greener your electricity now within

[00:39:22] Europe if you look at a country-wide basis UK is sort of somewhere in the middle

[00:39:29] Poland is the worst so the more you're using coal your electricity the worst you are in terms

[00:39:35] of emissions so Poland uses a lot of coal so they're not very good and so I can remember

[00:39:45] sitting with a CIO who was going to put a data center into Poland and I said by straightaway

[00:39:50] by doing that you're increasing your emissions by 10x versus putting it in a it's more like

[00:39:55] Germany so that's like another consideration to think about where is my data center going to be

[00:40:03] so thinking about the how you know what's the grid like how efficient is that country and

[00:40:09] countries can change this is all going to change over time these emissions can change on a daily

[00:40:14] basis and countries are gradually becoming more efficient the Nordics will not surprise you

[00:40:19] are the sort of leaders in Europe they've got the lowest the cleanest energy so the

[00:40:23] lowest emission factors but it also changes so for example within the UK where your data center is

[00:40:28] for example if you're up in Scotland they have more renewables up there so actually having a

[00:40:32] data center in Scotland so it makes more sense than having one down in the south so down in the

[00:40:37] south which we've got less renewables so actually you could even argue that maybe public

[00:40:43] cloud might you know might need to try harder because a lot of their data centers are in

[00:40:48] the south where they're using less green energy so it's a pretty complex it's a pretty complex

[00:40:54] topic Neil. It really is and I think the enterprise cloud index report indicates a growing

[00:41:01] trend towards diverse IT infrastructure first further over complicating everything so I've got

[00:41:08] to ask what challenges do organizations face in managing these environments you must be speaking

[00:41:13] to a lot of big businesses around the world and how are you helping them simplify some of

[00:41:18] these complexity? So when I talked about multi-cloud before I said so companies are

[00:41:24] ending up with this sort of accidental multi-cloud yeah and multi-cloud means you've

[00:41:29] got your multiple clouds in each cloud you're going to need a specialist team with specialist

[00:41:34] skills to run those environments and getting hold of the skills is a massive challenge

[00:41:40] getting visibility of all these environments is a massive challenge and keeping them secure

[00:41:45] and you'll typically have shadow IT you'll have folks going off and spinning up their own

[00:41:49] workloads in public cloud and trying to keep a track of all of this is a nightmare so

[00:41:55] and this is what and so what we were all about was trying to create this standardized

[00:41:59] operating model standardized way of running your data having by having the standardized

[00:42:05] model you have one set of skills to run multiple clouds and literally just today

[00:42:11] Google announced that they were going to offer bare metal services so this is like another

[00:42:15] cloud that Nutanis can run and operate in so you could run workloads in Google, AWS,

[00:42:22] in Azure and in your private cloud but with a single team and having a single visibility so

[00:42:29] that's what we've built out or building out in the case of Google this will

[00:42:35] that's going to require more work to build out but that's what Nutanix has been building

[00:42:40] towards this single standardized operating model for multi-cloud which we think will bring huge

[00:42:46] benefits for our customers in terms of accelerating innovation giving them the agility

[00:42:51] and being able to respond to unexpected change and making the organization more secure.

[00:42:57] Well we started the podcast talking about your background, your own personal origin story will

[00:43:02] put you on this path and if I now ask you to look back as we come full circle at some of

[00:43:07] your extensive experience in things like asset financing and understanding the business value

[00:43:13] of cloud solutions how do you see the financial models for cloud deployments evolving

[00:43:18] especially in light of things like sustainability and ESG considerations because again another big

[00:43:25] balancing act right? Yeah so I think we're on the verge of another change in a big like a

[00:43:33] revolution coming in IT so the way that so if I look at some customers the way that they bought

[00:43:40] IT buying or investing in new IT is pretty time consuming complex how do I go out find

[00:43:47] the right solution where do I find it and what we're seeing what we're what I believe

[00:43:53] is what we're going to see a lot more of is marketplaces so in the marketplaces

[00:43:58] sort of led by the hyperscalers so this is AWS and Azure and so becoming and what

[00:44:05] because what the genius of Amazon has been to make things really easy to buy we know how

[00:44:11] dangerous it is how easy it is to buy stuff on on Amazon sort of a frictionless purchase

[00:44:17] and what they've been doing is building out the capability so that you can buy

[00:44:24] IT solutions in the same way so you can go in you've got a standardized contract and you can buy

[00:44:30] multiple vendor solutions all through the marketplace so this is going to be

[00:44:35] I think the next big change and what it means is it gives gives transparency your

[00:44:41] pricing's there everybody can see it is fantastic so you're going to have to you know and I

[00:44:46] think that's only going to benefit the consumer is the more you can be transparent and what it's

[00:44:51] also from a new tax point of view is what we're about choice so so what we want to do is as part

[00:44:58] of this you know being part of this marketplace is also offer so we made our license fully

[00:45:03] portable so what that means is you can buy your license in one cloud but potentially

[00:45:09] do the purchase through your Amazon cloud but potentially take that same license

[00:45:13] and redeploy that elsewhere in the future so you're not necessarily tied in but it's a way of

[00:45:18] you can buy your solution through the marketplace so we think

[00:45:22] you know it's going to be so the marketplace is going to be the next big sort of like big

[00:45:26] change I think coming in how IT is consumed well I cannot thank you enough steam for

[00:45:33] taking the time out of your day to demystify the world of cloud economics ESG sustainability

[00:45:39] and hybrid multi-cloud it is an incredibly complex arena but you've done a fantastic job

[00:45:45] of talking about it in a language that everyone can understand today and before I let you go

[00:45:49] though I'm going to ask you to leave one final gift for everybody listening and that is a

[00:45:53] question I always ask my guests is a book that means something to you that we can add to a

[00:45:57] Amazon wishlist or a song that we can add to our Spotify playlist I don't mind which but

[00:46:03] what would you like to leave everyone listening with and why? Okay so actually

[00:46:07] so I just thought I've got a book in front of me actually so I read this it was the everything

[00:46:13] store by Brad Stone and it was a story about Amazon yeah and it's an absolutely unbelievably

[00:46:22] brilliant book a business book it's just really so for me was transformative in terms of

[00:46:27] you know the mindset that Amazon brought and where they came from how they react to changes

[00:46:33] and then they had this accidental business model for AWS that came out of nowhere I just

[00:46:39] have learned so much from that book and I keep rereading it so have a read of that book.

[00:46:47] Awesome I'll get added straight to the Amazon wishlist and for anyone listening

[00:46:51] wanting to dig a little bit deeper on some of the things we talked about today obviously

[00:46:55] Nutanix is a huge website anyway in particular you'd like anyone to check out or how they can

[00:47:02] contact you or your team etc. Where would you like to point everyone?

[00:47:06] So I know folks like to do their own research and maybe going around a website's not that

[00:47:12] exciting and lots of our customers are sort of techie based so we have got a

[00:47:17] phenomenal Nutanix university channel on YouTube and there's so much good stuff there

[00:47:23] so I would send just send people there and but you know come and engage directly with us

[00:47:29] we've got 25 cloud economists in Nutanix they'd love to come and you know what I've talked about

[00:47:35] is let's try and make that real free you know if you've got it if you're a vendor or a partner

[00:47:39] or you want to learn more engage with it you know happily engage with cloud economist team

[00:47:43] so we'd love to work with you. Awesome well I also do a blog post on my website

[00:47:48] techblogwriter.co.uk and I'll do a blog post for this episode I'll embed one of those

[00:47:53] videos there as well just to whet the appetite of everybody that's going to be checking

[00:47:58] that out and there's so much we've covered today from understanding the business case for

[00:48:03] today's cloud and the cloud economist main roles from helping customers establish a business

[00:48:08] case for a particular cloud solution and ultimately helping them understand how they

[00:48:12] want to pay for it whether it be capital expenditure or using consumption based as a

[00:48:17] service model and all the ESG and sustainability field we could have talked for another couple

[00:48:23] of hours on this but just thank you for demystifying it today I really appreciate your time.

[00:48:28] Thanks thank you very much still for your time. Wow we really covered a lot of ground there

[00:48:32] didn't we from the financial intricacies of cloud technology to the pressing need for

[00:48:37] sustainability in IT operations and Steen provided us with a real deep dive into how

[00:48:43] Nutanix is not only enhancing cloud efficiency but also leading the way with responsibility

[00:48:50] in that ESG arena and as we wrap up today let's think about how the evolution of cloud services

[00:48:57] impacts not just the business operations but also our environment and what steps can your

[00:49:04] organization take to balance efficiency and sustainability in its cloud practices

[00:49:11] and as we highlighted in the conversation today it's a hugely complex area and I'd

[00:49:16] love to hear your thoughts and invite you to share your ideas on this I think the only way

[00:49:21] we can make the world a better place and improve business processes and IT infrastructure etc

[00:49:27] is by us all pooling our resources and ideas together so email me techblogwriteratoutlook.com

[00:49:34] twitter linkedin instagram just apnealchughes I invite you to stay connected and continue to

[00:49:40] engage and explore how technology can solve real world problems so keep questioning keep learning

[00:49:48] and keep sending in your messages and hopefully we can make the world a better place but I also

[00:49:53] cordially invite you to join me again tomorrow we've got another guest and a completely

[00:49:57] different topic to explore together so hopefully you'll join me again tomorrow

[00:50:01] but thank you for listening today and until next time don't be a stranger