Dell President Scannell On Dell-VMware Products Post Spin-Off, AWS Vs. Apex

From taking on public cloud hyperscalers like AWS to creating an even “stronger” partnership with VMware after its spinoff from Dell, Dell Technologies President Bill Scannell dives into some of the hottest topics that channel partners need to know about.

Bill Scannell Explains The Future Of Dell-VMware, Why Apex Bests Pubic Clouds, And Cybersecurity

Dell Technologies president and worldwide sales leader Bill Scannell knows that Dell’s future with VMware will be bright and highly successful following Dell’s spin-off of the virtualization and hybrid cloud software star later this year.

“There will be a lot of companies trying to create FUD [fear, uncertainty, and doubt] in the market – we’re just not going to let that happen,” said Scannell, Dell’s president of global sales and customer operations, in an interview with CRN. “I saw a list of our future deliverables and products that we’re going to be bringing to market over the coming weeks, quarters and years. And everything is on track or ahead of track.”

The Thirty-five-year Dell EMC veteran also weighs in on why Dell’s new Apex as-a-service portfolio has a “significant” leg-up over the public cloud competition such as AWS.

“Everyone is starting to realize public cloud is expensive. It’s easy if you’re a startup and you want to be quick to market -- that’s the easy button. You have to figure a way that when you get to a certain size, how do you bring those workloads back on-premises. If you’re a large enterprise customer with any skill whatsoever, you can always run those applications more cost-effectively on-premise than in the public cloud,” said Scannell.

As the $94 billion Round Rock, Texas-based infrastructure and PC giant comes off its best fiscal year in its history, Scannell takes a deep dive with CRN about the company’s product strategy and “strong” partnership ahead with VMware, Dell Apex versus AWS, and why Dell’s cyber recovery solutions are the best in the industry, “bar none.”

Should Dell and VMware’s partners expect any changes post spin-off? What will the new Dell-VMware partnership be like?

I’ve had two meetings this week. One with [VMware’s new CEO] Raghu [Raghuram] (pictured) and his leadership team, and the other was with the sales teams. I will say that our relationship is getting stronger based on the fact that we’re potentially going to be facing the spin-off in Q4 this year. A big part of VMWare’s revenue is driven by Dell Technologies. We did that for all the right reasons. We delivered solutions around IT transformation, multi-cloud, security transformation, workforce transformation, digital transformation, with our joint offerings. We are definitely better together and both companies want to ensure that it only gets better post spin-off.

There will be a lot of companies trying to create FUD [fear, uncertainty, and doubt] in the market – we’re just not going to let that happen. It’s just too important to both of our companies, but more importantly to our customers to ensure the relationship gets better and stronger. The offerings – I saw a list of our future deliverables and products that we’re going to be bringing to market over the coming weeks, quarters and years. And everything is on track or ahead of track. I’m happy to say we haven’t missed a beat and, if anything, I think we accelerate development and the relationship gets better over time. Even better than it is today. And it’s pretty darn good.

Are these future products ahead for Dell-VMware around hyperconverged infrastructure, security, etc. -- anything you can talk broadly about?

Yes, it’s about hyperconverged. It’s about security. I can talk about a lot of things broadly, but if you think where we’re going with cloud, where we’re going with the whole work and learn from home experience with Workspace One and Unified Workspace – just marrying our products with VMware products, and coming out with solutions that drive better outcomes for our customers – that’s what we’re focused on.

Customers have told us where they’re going. We know where the markets are going and we plan on getting there first with VMware.

Michael Dell (pictured) recently said VMware is great, but it’s not the only solution out there and Dell works well with other vendors too. What type of new partnerships is Dell looking to make post spin-off?

System integrators and technology partners to deliver better outcomes. We’re always looking to expand our ecosystem. It’s never stagnant. We add new partners into that ecosystem – whether it’s application providers or, heck, we were talking about a big win at Samsung. We were looking at some of the application providers in that space that we work with to deliver better outcomes with Samsung. That’s the ecosystem that we’re talking about. There will be additional partners, in addition to VMware being our first and best, but we’re working with other partners out there that makes sense for our customers.

Why should channel partners be bullish about Apex and what are some big opportunities?

We’ve been talking about a multi-cloud world for the better part of five years. Increasingly customers are now getting on-board with our way of thinking. A lot of the large advisory channel partners – the Accentures, the Deloittes – are now realizing that it’s not an all-public cloud, all-hyperscalers – there’s a healthy mix of both. The more we can help deliver that cloud environment, cloud operating model, in keeping those workloads on-premise. They’re quickly realizing it’s a much better answer.

So what’s a big issue with the public cloud that Apex can solve better?

[In] a recent study by Andreessen Horowitz, ‘The Cost of Cloud, A Trillion Dollar Paradox,’ they talk about all those companies, especially SaaS providers and software companies that started off in the cloud because it seemed like the right thing to do. But then they talked about the real cost of cloud later on and how expensive it is. They took a look on the impact of their market capitalization because [companies] were spending twice as much to run those workloads in the cloud – that’s money that would have gone right to the bottom line. And if it went to the bottom line, it would have increased their market capitalization. They gave around 50 different cloud companies as examples.

It confirms what we’ve been saying for years, there is a time and a place for a public cloud -- a hyperscaler -- but there’s more of a time and place for running those workloads on-premise in a cloud operating environment. So, if we can give the cloud operating environment, the speed and the agility, and give the cloud-consumption models.

Why is Dell Apex a better solution for businesses versus the public cloud?

Customers are increasingly telling us two things: ‘Yes, I love the fact that I have a cloud operating model on-premise, but I don’t want to own data centers and I don’t want to own the assets.’ So we have now partnered with Equinix, with Switch and a lot of the colocation companies out there, to say, ‘Customers don’t want to own data centers. Let them run their workloads in your data centers.’ Then we can have a utility model with Apex where customers don’t have to own the assets. We can own the assets. We’ll run them either in their data centers or a colocation of their choice, and they pay for those as they use it. We want everything to be Apex. So everything as-a-service. So, starting off with storage and then compute and backup, the whole cloud environment can be as-a-service running in a colocation, in a true cloud operating environment.

So now customers are saying, ‘All the things I thought I would get by going to a public cloud, I can get by keeping those workloads on-premise or in a colocation. And I can do it for, by the way, 35, 40, 50 percent less expensive.’ That’s the real value proposition with Apex.

Can you give me an example of how Apex is must more cost effective than the public cloud?

We started working with a large, global financial institution customer six months ago. I said, ‘I think we can do this for about 40 percent less than if you go to AWS.’ When the study was completed, it was 48 percent less. These are real dollars. I mean these are customers with multi-billion budgets and if we can have that type of significant impact, then money can go towards the customer’s market cap.

We have a significant one-two punch: We save them opex [operating expenditure] and they can have a higher valuation as a company because so much more money is going to their bottom line.

This 48 percent cheaper use case, was that Dell Apex versus AWS?

In particular, this case, it is an Apex offering. But even if the customer were to buy that asset and capitalize it or have an operating lease, it’s still going to be north of 40 percent less expensive to do it on-premise versus going to one of the big three hyperscalers.

Everyone is starting to realize public cloud is expensive. It’s easy if you’re a startup and you want to be quick to market -- that’s the easy button. You have to figure a way that when you get to a certain size, how do you bring those workloads back on-premise. If you’re a large enterprise customer with any skill whatsoever, you can always run those applications more cost-effectively on-premise than in the public cloud.

With the increasing ransomware problem grabbing global headlines, can you talk about Dell’s cybersecurity strategy?

You recently have all these huge, giant companies in every vertical getting attacked by ransomware. Anne Neuberger, who’s the national security advisor for cyber and emerging technologies for the U.S, government, came out and said, ‘We have to protect ourselves. And the president is working on helping companies protect themselves.’ But they described a solution that, without mention Dell’s [PowerProtect] Cyber Recovery Solution – that’s exactly what they describe – which is an immutable copy of the data that you can air-gap from your network, take off the network.

What these adversaries and hackers are doing right now, they’re going in through the network or going in through the endpoints – and we have lots of ways to protect the endpoint and the network, whether it’s Carbon Black for the endpoint or VMware NSX for the network – we can protect that. But despite everyone’s best efforts the bad guys are getting in. What they do is they first encrypt the backup data, so now you don’t have a clean backup. Then they get and encrypt or delete your online data. Then they put the verbal gun to your head and say, ‘Pay me a ransom.’ I think it was $50 million for one recently. It was $11 million for another recent one.

What we have done and implemented in over 750 accounts around the world so far, is we go in with our Data Domain solution with some scanning technology, and we will actually do a backup of all of the mission critical, franchise applications, and we’ll take it off the network. So we create that air-gap solution that Ann Neuberger is referring too. We’ll take it off the network. So, if the adversary comes in and deletes your online data and your backup data, you have a clean copy to recover from. You don’t have to pay ransom.

With Dell’s Cyber Recovery Solution, why wouldn’t a company not have to typically pay the ransom?

Quite frankly, in a lot of these ransomware attacks – they’re bluffing. They don’t have the keys. They haven’t encrypted and they can encrypt the data. People are paying the ransoms because they’re afraid that maybe the hackers do have it. If you have the piece of mind to know you’ve got a clean, known, good copy of your data by which to recover from, then you don’t have to play party to these ransomware attacks and you know that you can always recover from that worst case scenario.

Many of our channel partners have already figured this out and gone to market with up to 750 customers. I would say over half of these customers went through our partner community, but it creates the biggest opportunity for partners.

As we like to say at Dell Technologies, everybody needs a cyber vault. Look, they’re attacking hospitals, high schools – every company out there big or small needs a vault. We have the best solution in the market, bar none, and we can help our customers and partners help our customers protect one of the two most important assets: people and information. We can help protect that data asset by ensuring a known good copy.