On this episode of the Futurum Tech Webcast – Interview Series, I am joined by Scott Ramsay, Global Vice President, HPE GreenLake Cloud Services Portfolio, for a conversation focusing on the evolution of public cloud.
In our conversation we discussed the following:
- Scott’s thoughts on public cloud, its initial takeoff, and the problems public cloud is helping to solve
- A deep dive into how public cloud is meeting customer expectations and improving the customer experience
- An exploration into how the HPE GreenLake platform is evolving to address the current set of challenges for businesses
- The driving factor behind the maturity of the HPE GreenLake platform and the long term advantages for the company going forward
It was a great conversation and one you don’t want to miss. To learn more about HPE GreenLake check out their website here.
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Daniel Newman: Scott Ramsay, VP ISV Workloads on GreenLake Marketplace, welcome to the GreenLake Executive Podcast Series. How are you today?
Scott Ramsay: I’m good, Daniel. Really excited to be talking to you. It’s been a while since we’ve met in-person, but it’s always good fun for when I get to catch up with you.
Daniel Newman: I’m starting to feel hopeful, Scott. I’m starting to feel like some of these live interactions are once again becoming possible.
Scott Ramsay: Yeah, I think so.
Daniel Newman: Some of these events are happening and that’s encouraging. And so maybe just maybe Discover this year, we’ll get the chance to shake hands and break bread once again. But until then, we’re going to have to settle for these encounters across the WebSphere with some, at least the cameras, microphones, connectivity is getting better enabled by the cloud, which is what we’re going to talk about today. But first and foremost, before we do that, do you want to take a minute, just introduce yourself. First of all, I read off your title. So why don’t you give us all just the, hey, I’m Scott Ramsay and this is what that really long title means I do every day for HPE in the GreenLake business.
Scott Ramsay: Yeah, of course. I love the length of title. It makes me sound quite important, but in the reality, I can break it down into a couple of key components. So actually, let me give you a very brief history on myself here, Daniel, because I think it’s relevant to the conversation that we’re going to have today. So I am actually one of the original people in GreenLake, actually long before it was called GreenLake. So I was part of a small group of people who really kickstarted this initiative around about 10 years ago. And we’ll get into the details there. So I’ve had a variety of roles over that last decade and my latest role is really two things. I’m focused on working with a range of third party software providers to develop GreenLake solutions that are optimized in the context of the capabilities that ISV provides. So it really is focused on enabling outcomes around the ISV. And the second part of my role is to build a vibrant and feature-rich marketplace for our customers to build and enhance their GreenLake offerings.
Daniel Newman: That sounds like a big job right now considering the importance that GreenLake plays to the company. If you followed my work, whether it’s been bringing your CEO, Antonio Neri, on to my Making Markets pod, or just commentary that I’ve made across the web on Forbes MarketWatch. And then of course on our feature and research site, you’ll see that I’ve been quite optimistic about what you guys are doing in the GreenLake business unit. It’s very necessary right now despite the thought process over the last decade or so that everything was going to go to the public cloud. We’ve seen emphatically that that is not the case. And so we’re spending a lot of time trying to educate people on what hybrid cloud is, why this is going to be the most likely winner as it comes to the architectures for enterprises going forward.
And so I thought we could have a little fun for this series since we’re going to have a number of conversations to start off talking to you about the evolution of public cloud. Because like I said, if you went back 10 plus years, you would’ve probably heard a lot of prognostication that, hey, everything’s going to be in the cloud. Well, here we are 2022 and it’s still less than a third roughly of workloads. Some have say as low as a quarter that are actually in the cloud and the rest of it’s in some capacity on-prem or being delivered through hybrid. So I guess maybe with your history being part of this from the beginning, Scott, what are your thoughts on public cloud? It’s initial takeoff, what problems it was solving. Let’s start there.
Scott Ramsay: Yes. So my discussion in Amsterdam of all places which took place, like you say, almost exactly 10 years ago today, was really predicated on this emerging threat of the public cloud. It was offering a very interesting alternative to the traditional transactional hardware purchase build it yourself kind of solution that many of the enterprise customers were running. And what we were able to observe from the public cloud was a number of things that they did that were really interesting and beneficial for our customers, but at the same time, we strongly believe, and I think HPE has been one of the long kind of advocators of it’s going to be a hybrid world. I think we’ve been seeing that for as long as I can remember, but we realized then that we need to learn from the best practices of the public cloud, but deliver that in a dedicated solution on-premise or in our customers’ location choice to them and for them.
So really the public cloud was a very, very interesting forcing function for us to start to think differently about our business and the way that we helped our customers solve their problems. And this was really how we approached this. How do we help customers solve their problems? So initially, we looked at that and said, well, one of the key things that the public cloud does, Daniel, is that it takes away the cost of overprovisioning and underutilization of a dedicated data center. In fact, the very reason that the public cloud became a thing was because it was an underutilized data center that was shared out to other people. So by kind of looking at that model to see how do we help customers manage their capacity, pay for what they’re using, have no upfront costs, be able to grow or shrink in line with their business needs, that became the genesis of what became flexible capacity.
And then as we started to look more and more at the public cloud, we solved for that kind of financial problem, if you like, but the next kind of hurdle that we started to attack was the simplicity of the public cloud. It’s a very interesting financial model, but what the public cloud does exceptionally well is simplify the overall experience for customers. But as you said, depending on who you look at and what analysis you believe, 60% to 70% of workloads are not going to the public cloud. So what you have to try to do is give that public cloud experience in the choice for the customer in the kind of location of choice for the customer.
So a big part of what we’ve been doing is over the last five, six, seven years is focusing in on that experience, making it simpler and easier and faster to deploy and automate the various use cases and workloads that our customers run. And just to kind end on that, the thing that a customer told me a couple of years ago, and I love the phrase, I need you to care about the outcomes of my customers. Not just my outcomes, the outcomes of my customers. If you think about that, that’s the kind of experience you need to be thinking about as you deliver GreenLake to me. And that’s been a kind of a north star for me as I’ve thought about how we evolve our overall solution.
Daniel Newman: And that’s a kind of a big set of challenges as a technology provider to take on not only your customers’ challenges, but your customers’ customers challenges. And that’s a big part of where IT is. You’re seeing your company has moved in the direction of everything as a service. We’re seeing an increase of what I would call outcome as a service. It’s becoming more the delivery model of major global consulting firms saying, pay us for the results, not for the information, which of course is a tremendous thing in the right partnership. And of course, that takes on a lot of risk for those companies that are following that model.
And I want to be really clear about something. I think you and I are saying this, Scott, together, but is that neither of us are saying the public cloud is not a good thing. We’re both, I think, pretty firmly and fiercely in agreement that-
Scott Ramsay: Absolutely.
Daniel Newman: For certain workloads, certain scale, some of what you heard from your customers was make it easier, make it faster, allow me to spin up a workload to get access to data, to be able to deliver customer experiences, low code applications that my analysts or business frontline people can create and deploy in seconds. And some of this is done in the public cloud. We certainly have seen applications in almost every field that are well deployed and successful there. But I think what wasn’t well understood was going to be the balance of how this was going to actually play out in the market. And the fact that companies have a lot of complexity, they have regulatory sovereignty, they’ve got compliance requirements, they have legacy applications that are going to need to be upgraded over time very cautiously to not disrupt those business outcomes, both internally and for customers. There’s a lot of things happening concurrently that have led to this mix there.
Then on top of that, you got security, which companies have to think about, and you’ve got workload placement and deployment. Most of us when we first started talking about cloud, this will actually take us nicely into my next question. When we first started, we were mostly talking about a centralized infrastructure and data system, right? Edge was still kind of in its infancy. We’d gone back from sort of the topology that rotates between sort of client server or terminal edge to much more centralized and now we’re going back and seeing edge becoming by far the most exponential growth opportunity for data and for applications and deployment. And it’s become more and more a focus of companies, which creates more complexity leading to more use.
So I used the idea of a 10 year retrospect. So from where you started and what you heard from the customers that led you down the path and what you heard about public cloud, do you think you’ve met the expectations? Has the public cloud met expectations? Do you think that what we’re seeing now with this mix is going to change? In which way do you see that changing?
Scott Ramsay: Yeah, it’s a big question because meeting expectations is I think a perpetual thing. Expectations continue to evolve and as a result, everything that we do continues to evolve. So those expectations rightly continue to move forward and how we address them continues to move forward. So it’s a never ending kind of quest to continually deliver a better solution. What I would say for the public cloud is that I think it definitely met the expectations of a certain number of use cases. And I think you’ve done a very good job, Daniel, of articulating the use cases that it wasn’t particularly suited for. And I don’t think any of us really understood that 10 years ago that there was going to be regulatory issues that would stopped workloads moving to the public cloud. The application and reconfiguration was going to stop things moving to the public cloud. There was performance and performance consistency things that stopped things moving to the public cloud.
So I think it certainly has met expectations in some cases, but certainly not in all cases. And I think that the challenge that sits in front of HPE now is to make sure that GreenLake starts to deliver that experience wherever the workload or the application is running. And I love the vision that Antonio has set out of us being the edge to cloud company because I do think that we are seeing lots of workloads moving to the edge. We expect that that kind of simplicity of use, that simplicity of payment, that kind of ability to kind of get what you need at the edge but have kind of some of the data processing kind of working in the cloud. Some of that stuff is going to be absolutely critical for us.
And I think the connectivity from the edge to the data center and then the ability to give an overall experience where certain aspects of our customers are running workloads in a multi-cloud environment where they’re leveraging the public cloud, I think that’s a big part of how we’re going to evolve our overall offering here. And I think the public cloud initially when we started, I think honestly, we’re probably feeling some degree of threat there whereas we’ve got deeper into that coexistence and that partnership with the public cloud to deliver the customer’s outcomes that we need is absolutely key. And again, I can only commend Antonio’s kind of thinking here. He’s absolutely been pushing this idea of the hybrid. It’s going to be a hybrid world for a long, long time long before many of our competitors were even acknowledging that.
Daniel Newman: Yeah, absolutely. You hit on a lot of things. And of course, something I’ve been watching very closely has been that migration up and down the stack, some of the partnerships that the company has rolled out, some of the industry and vertical solutions, which I think has become an increasingly critical part of strategy industries, especially regulated ones want to see some specialty focus, right? Whether that’s financial services and banking, healthcare. So you’ve addressed sort of horizontally and vertically. You’ve got expanded data services. We talked about going out to the edge.
So let’s go a little deeper there, Scott. Let’s talk about this because you guys started off kind of like any public cloud service. You had like, hey, here’s our first service. We’re going to do this. Here’s storage, here’s compute, right? Really, if you look back to the AWSs, that’s the same thing they did. They said here’s one service, here’s one service, and then eventually they said, okay, we’ve got to become wider. We’ve got to become more vertical, and they’ve done that. You’re doing the same thing. And so you called it edge to cloud. It’s really an edge to cloud platform. And I’ve talked to your team about this and I think that’s what you’re building is a platform. And I think that’s what people are adopting are platforms. So talk about how the whole GreenLake platform is evolving to address what really is the current set of challenges for businesses.
Scott Ramsay: Yeah, I think you’re absolutely right. It is edge to cloud platform and that is absolutely what we’re building. I think… So let me ask a question because there’s two angles. From a platform perspective, I think that the key here is to give customers access to the resources they need to run the workloads they need, the applications they need, to get to the outcomes they need with the minimum of operational disruption to them. So the platform is all about making it easy for our customers to get access to the resources, to kind of deploy the images onto those resources that they need to run the workloads and to get the ultimate experience or the ultimate outcome from those workloads that they need. So the platform is absolutely all about making sure that no matter what workload you’re running, where you’re running it, you’re going to get it optimized in the context of the workload. And the complexity of getting access to the underlying resources is removed from the end user. So that orchestration and self-service experience is a key part of the thing that we’re trying to create with the edge to cloud platform.
And then something else that I think is really interesting for me is this vertical focus. So as we talked about the shift of kind of thinking that the public cloud was the answer for everything kind of driven by a lot of regulatory and compliance and security kind of concerns, what we’re seeing is that those are quite acute in certain vertical industries. So a big part of how we’re thinking about this is how do we make sure that we optimize specific use cases for specific industries?
So let’s pick on healthcare as an example. Electronic healthcare records is clearly something that’s incredibly sensitive under a lot regulatory compliance, but it’s a very big industry and they want that same kind of experience with the public cloud. So part of what we’re doing as well as building the kind of optimized platform to run a whole multitude of different workloads, we’re also looking at kind of optimizing certain use cases specifically for certain vertical industries. So in healthcare or financial services or defense. You probably can automatically think of those highly regulated industries that are really looking for a cloud experience but can’t really seriously consider moving many of their workloads onto the public cloud.
Daniel Newman: Yeah. I think that we’re going to see more and more consolidation too, and we’ve seen some big acquisitions made in this space. We’re going to see the marriage of technologies, vertical-based technologies, cloud providers, data solutions. We’re going to see this continue to… I would say the relationship and the symbiotic relationships both are going to continue to grow a lot in the next few years. Again, we’ve seen so many cloud four is what I call it, cloud four industry, cloud four financial, cloud four healthcare, cloud four manufacturing. And that’s very intentional, Scott. It has to happen because these companies are spending massive amounts of dollars. You see the amount technology is shifting certain industries. This isn’t a direct example, but it’s one that I think gives people perspective.
Right now in a high tech vehicle, about 4% of the bomb of a vehicle is semiconductors. By 2030, it’s going to be 20%. That’s a five times as much influence. So you think about that in an old industry like automotive, the amount of technology going into it. That’s the same thing in every other industry though. The idea that every company is a tech company has really grabbed a traction in the marketplace because no matter what business you’re in, technology is going to be what powers you to get to where you want to go. It could be a very old industry, it could be a new industry. So having the right platform, having the right technology, right foundation, the right access to data services is going to be critical.
Now, where I’d love to finish here because this is something I have documented, I’ve written white papers about this, I have gone on numerous podcasts, I’ve talked to your CEO and other executives at HPE, is that what I think one of the big advantages for HPE has been the fact that it was early. In 2018/19 when this first came to market when Antonio first said, we’re going to deliver everything as a service, I said, that’s very cool. I like it. I also said, now show it to me. I want to see it because it was kind of hard to digest early on. I was like, really, you’re going to be able to do this? You’re going to pivot from a big iron company that moves big boxes, CapEx to a services company?
And we’ve seen it. Fastest growing part of the business every quarter and the part that, by the way, I think the street should be paying the most attention to when you’re just trying to decide just how exciting and investible and what the future for HPE really looks like is how fast is GreenLake growing. So you having been there for the better part of a decade. Now you’re seeing fast followers, slow followers from different competitors coming in. It’s certainly becoming more dense with opportunities and options for your clients and for competitors to come in. How important is the maturity of the GreenLake platform the way it’s been built to deliver what customers need and how big of an advantage is that going to be for the long term for the company?
Scott Ramsay: Yeah, well, first of all, you’re right about the kind of we’re seeing more and more people enter the market here. And I guess imitation is the highest form of flattery, but they’re a long way from being able to imitate us in all honesty. So I feel good about the lead that we’ve got, but in no shape or form complacent about that. I think it’s something that we’re going to have to work very hard to continue to evolve our offering. And I feel confident that we can and will do that. I guess my observation about this is that we’ve got 10 years of rock solid experience. So GreenLake as a brand is about three years old, but before that, we had the flexible capacity offering which evolved into GreenLake.
As we built our offering and our solutions, as in any kind of innovative space, we of course made some mistakes and we learned from that and we iterated and we got it right the next time and we’ve got better and we’ve continued to improve. And that kind of learning and that legacy is going to stand us an incredibly good state as we move forward into the next phase of this. If I look at the, and these are kind of public numbers, we’ve got well over 1,000 customers. We are adding new logos every single week into the GreenLake. So more and more customers coming on board. We’ve got incredibly high retention for GreenLake. So that ecosystem of customers that are working with us, that trust us with their most critical workloads, continually engage with us to tell us how to improve our offering, how to evolve our offering, how to get the priorities in terms of wherever investments need to go to make the offer better.
Yeah, as people come into this market, they don’t have that advantage. They don’t have that scar tissue of learning. They don’t have that really strong, robust customer base who are helping us continue to evolve the offering. And customers in the best possible sense, they’re rightly continuing to give strong feedback on how we can improve and we incorporate that and use that to prioritize. So if I think about it, we’ve got really strong installed base where we can learn from. We’ve got 10 years of learnings that we can build upon from there. We’ve got the absolute top sponsorship from our CEO to go and get this done. And I think that we are… No, sorry. I know that we are the market leader in this space.
So I absolutely believe that from that position, we’re going to go to strength and strength. And as you said, the numbers that are getting reported quarter after quarter, this is a very fast growing segment for us and I have no doubt, none whatsoever that this is going to continue to be one of the fastest growing segments for us as we move forward through ’22 and ’23 and beyond.
Daniel Newman: Absolutely. My perspective is not only that it should be, but it must be. That’s going to be the difference between the company gaining the momentum it needs to gain. But the bet has been made. Antonio and you and all of his leadership are of course running very fast to execute it. I think a very realistic view for me as an analyst is that you guys have done a lot of things right. This is the key growth area of your business. You’re addressing a market that is necessary. And of course, the balance view is you’ve got very, very good competition. And I hope, as I always say, that that competition continues to drive innovation, which from what I’ve seen so far, it has.
Scott Ramsay, I want to thank you so much for taking the time to join me for this podcast series. It’s been really good talking to you about not only GreenLake, but about the cloud, its evolution, the opportunities, the challenges. And I hope anyone that’s out there, all you business leaders that are listening to this are kind of hearing what’s going on, getting more insight on both the HPE part of it, but also the general evolution that’s going on in technology and architecture and how to run your business. So for this episode, I got to say goodbye. Thank you all very much. We’ll see you later.
Scott Ramsay: Thank you, Daniel.
Daniel Newman is the Principal Analyst of Futurum Research and the CEO of Broadsuite Media Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise. Read Full Bio