On theCUBE Pod: The cloud wars rage on as others declare ‘AI or die!’

On theCUBE Pod: The cloud wars rage on as others declare ‘AI or die!’

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It was a big week at theCUBE, as the Supercloud 3 event, presented by SiliconANGLE and theCUBE, SiliconANGLE Media’s livestreaming studio, ran July 18-19, featuring a veritable Who’s Who of industry leaders.

It was a good time to take stock of the ongoing cloud wars, which are at a complete “wind change” right now, according to theCUBE industry analyst John Furrier (pictured, left).

“Microsoft putting on a clinic over AWS, in my opinion, on the optics,” said Furrier on the latest episode of theCUBE podcast. “Amazon continuing to be the best cloud, in my opinion. Microsoft’s catching up. But I’m telling you right now, Microsoft is putting on a marketing clinic.”

It’s also Microsoft’s artificial intelligence world, “and we just live in it,” noted theCUBE industry analyst Dave Vellante (right).

One can never count out Amazon Web Services Inc., and things are still early. But the recent move that Microsoft Corp. announced that its 365 Copilot would cost $30 per user per month was “genius,” according to Vellante.

“I mean, you do the math. There’s like 400 million Office 365 customers, commercial customers, users, you know, seats,” he said. “Initially, the Copilot’s geared towards 365, not just Office 365,” he said. “But the total addressable market is like $140 billion. Microsoft added $100 billion in market cap based on that announcement.”

That hits on the elephant in the room — that the big incumbents can absolutely benefit significantly from the AI wave, according to Furrier. That goes for Microsoft, and for AWS “if they don’t screw it up,” he said.

“This next wave of startups coming in, I’m telling you right now, it could be that some of the biggest whales, could get bigger and bigger and fatter, and some might not catch up,” Furrier added. “It’s going to be very interesting to see who’s going to be on the right side of this. Will IBM and Red Hat make a play there?”

When the bloom is off the AI rose, it’s going to be easy to really tell which cloud did their work, according to Furrier.

“You have two cultures. Microsoft’s the big scripted culture, everything about Microsoft is about optics: ‘Look how great we’re doing,’” he said. “They are, as of today, out-marketing and out-PR’ing AWS. It’s not even close. It’s like a shutout. It’s a 10-run rule in baseball, Little League. They’re getting killed. Game over.”

AI or die!

Throughout theCUBE’s summer event coverage, there’s been no shortage of announcements tied to AI. For example, there was Dell Technologies Inc. and Nvidia Corp. detailing Project Helix or Hewlett Packard Enterprise Co. expanding its flagship HPE GreenLake portfolio to provide access to large language models that power generative AI.

“Every show we go to, it’s like … we’ve got to have our story here,” Vellante said. “If you don’t do an AI, you’re going to be toast.”

It’s “AI or die,” as Greylock partner Jerry Chen has put it. But the data is also revealing interesting side effects — that AI is taking spending priorities away from other areas, according to Vellante.

“It’s definitely impacting other sectors. Even cyber, cloud is being optimized. RPA, has come down a little bit, even though it’s now ticking up again. Automation’s doing a little better,” Vellante said. “I think AI is stealing not only mind share, but also wallet share and resources away from these other projects. People are delaying some of their other IT projects, focusing resources on AI. That’s what the data says.”

That poses another interesting question. As cloud players look at that, will cloud spending increase? The read of the data suggests that cloud numbers will be solid, according to Vellante.

“It’s not going to rocket back up,” he said. “But I think this optimization trend and the deceleration that we saw is going to moderate, and maybe even turn positive.”

The narrative may be that 85% to 90% of workloads are still on-prem, but Vellante doesn’t believe that at all. In his view, it’s more like 45% to 50%.

“Notwithstanding telco, telco is different,” he said. “So, I don’t think there’s as much upside momentum in the traditional IT space as the cloud players would like you to believe. I think there’s still plenty of room to grow, but that’s going to come from other use cases.”

Watch the full theCUBE Podcast below to find out why these industry pros were also mentioned:

Vittorio Viarengo, VP for Cross-Cloud Services at VMware
Howie Xu, SVP of engineering and AI/ML at Palo Alto Networks
Jay Parikh, CEO of Lacework
Tom Gillis, SVP and GM of security at Cisco
Doug Merritt, chairman, CEO and president of Aviatrix Systems
George Kurtz, founder, president and CEO of CrowdStrike
Jay Chaudhry, founder, chairman and CEO of Zscaler
Matthew Prince, co-founder and CEO of Cloudflare
John Roese, global CTO of products and operations at Dell Technologies
Kevin Mitnik, CEO and chief “White Hat” hacker of Mitnick Security Consulting
Lina Khan, chair of the Federal Trade Commission
Steve Ballmer, former CEO and president of Microsoft
Matt Garman, SVP of sales and marketing at AWS
Andy Jassy, president and CEO of Amazon
Charles Fitzgerald, consultative strategist and investor
Jeetu Patel, EVP and GM of the Security and Collaboration Business Units at Cisco
Bipul Sinha, co-founder, chair and CEO of Rubrik
David Flynn, CEO of Hammerspace
Elia Zaitsev, CTO of CrowdStrike
Mignona Cote, CSO of NetApp
Jaya Baloo, CISO of Rapid7
Alvina Antar, CIO of Okta
Phil Venables, VP of Google and CISO of Google Cloud
Mario Duarte, VP of security at Snowflake
Zeus Kerravala, founder and principal analyst at ZK Research
Emmet Shear, former CEO of Twitch
Kevin Lin, co-founder and CEO of Metatheory
John Chambers, CEO of JC2 Ventures

Don’t miss out on the latest episodes of “theCUBE Pod.” Join us by subscribing to our RSS feed. You can also listen to us on Apple Podcasts or on Spotify. And for those who prefer to watch, check out our YouTube playlist. Tune in now and be part of the conversation.

Photo: SiliconANGLE

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