Remarks by Steve “Guggs” Guggenheimer, Corporate Vice President and Chief Evangelist, in Orlando Florida, July 15, 2015.
(Applause.)
STEVE GUGGENHEIMER: Good morning, everyone. I hope you’re all having an outstanding Partner Conference. I’ve had the opportunity to talk with a number of ISVs over the last few days, and the energy is incredible. I think probably the reason the energy is so incredible is because of the time we live in.
I want to pick up the conversation where Brad left off. I thought Brad did a great job of bringing the global nature of the world we live in and how technology impacts that, in some cases it’s disruptive, into the next level. In fact, he did it from such a unique angle I know that all of us at Microsoft enjoyed listening to him, and I hope you did as well.
On the topic of disruption I want to have a conversation around where we are as an industry and where we’re going. I often end up in a conversation around is the pace of change in the world we live in, in this particular space, constant or is it increasing? And I personally feel like it actually is increasing.
If you go back two decades, we were worried about processor speeds on devices, 286 to 386, 386 to 486 to Pentium to GPUs onboard. And as we got all this processing power, then what could we do with it. And then along comes digital media, right, and then storage becomes important, 5-1/4 inch disks, 3-1/2. You remember the storage, the little blocks that we used to have that we stuck into them — I can’t remember the brand off the top of my head. And now we just continue to move forward and storage continues to drive forward and the cost comes down.
And then you get to bandwidth, and of course wired line or fixed line, and then wireless, 2G, 3G, 4G, LTTE, et cetera. And now as those all come together, they’re driving the pace of change that’s incredible, or enables incredible disruption across all of the industries. There was a time when each of those technologies and the hardware they were associated with allowed for separate ecosystems. There was a phone ecosystem. There was a PC ecosystem. There was a TV ecosystem. Well, the boundaries between those ecosystems have come down. They’re gone.
And what happens today is where people talked about convergence in terms of going to a single device, what we have is a convergence of technology that’s leading to an explosion of devices. And in some cases, a collision of ecosystems or industries, or just overall disruption of every industry that’s out there today.
I think Jeff Immelt said it best relative to this conversation that at this point in time we’re all software companies. We’re all ISVs. And as we embrace that and go forward, we should think about how we disrupt ourselves as well as look for new opportunities in the space. If you look out there today, all of our traditional partners have a new set of competitors or people coming into the space. And there’s disruption in every industry.
In transportation, if you look at what Uber and Lift are doing relative to personal transportation, look at what’s going on around the movement of ships and containers. If you go into travel, we used to think about Expedia and using the Web. Now we think about Airbnb in terms of what it’s doing to the hotel side of things.
On finance, Intuit, Sage and others are reinventing themselves. At the same time, Zero from New Zealand is coming in as a new competitor and a new player in this particular space. Disruption is everywhere. Healthcare, McKesson, GE, Cerner, all reinventing themselves. At the same time, Fitbit, the Microsoft Band, other technologies are coming into the space.
So it’s in this particular area that we should talk a little bit about how can we help you with disruption in terms of thinking about this and in particular make sure that everybody is onboard for the change and the wave that’s coming. I like to use ourselves as a starting point. We’ve been through this a couple of cycles. We’ve disrupted ourselves, we’ve been disrupted.
Office is a great example. The first part of this conversation was taking a set of individual products, putting them together, changing the packaging, a little bit over time around the licensing models, and voila, a new change in this particular area.
And then over time we added Web technologies. In the client-server era you add SharePoint, you add Exchange, you have a whole new model for Office. You have a new opportunity to sell and change the dynamics. And many of the partners in this room have helped us in this change and this disruption.
As we move forward, then the Web comes. You add extensions, then you guys remember BPOS, Business Productivity Online Services, you go to hosting. And now with Office 365 it’s completely reinvented for the new world, the new cloud and mobile world. Fifty million users today, a new set of APIs for developers, a new opportunity to reinvent line-of-business applications and to begin over again.
Now that’s one example from our side. I thought I would take a little bit more fun example for the rest of the conversation. I would call it the Connected Cow Part 2. For those of you that came to BUILD, my colleague Joseph Sirosh told the story about cows and machine learning, that essentially if you put a pedometer on a cow and watch how they walk and their movements, you can figure out how to make more cows. And if you’re really good at it, how to make more boy cows versus girl cows or girl cows versus boy cows.
Now I don’t tell the story as well as Joseph, so I put a link up here to aka.msinternetofcows. And I would say go look at that story for the technology underpinnings for disruption in this space.
Now what I want to do is talk about the second part of this story. Which geography do you think produces the most milk per cow in the world? I would scratch my head. I might think Wisconsin and Cheeseheads if you’re an American, and you might think of Holland and the rolling grass plains, maybe somewhere out in Scotland or the U.K. It turns out the No. 1 producer of milk per cow is Israel. Now, congratulations, I heard a few claps out there. Essentially they have 50 percent desert with only 125,000 cows is the No. 1 producer.
How is that possible? Well, let’s build on the Joseph story and talk about the Internet of Cows. I have to pause here. I was going to call this slide barn in the cloud, but that was too cheesy, so I just didn’t go there. So we’re just going to stick with Internet of Cows and stop there.
They are using now as an industry collectively a set of sensors on the cows in the country that track how much they move, rumination, health of the cow, temperature and several other parameters. They feed it into the cloud, they use machine learning to track the cows, the health, and actually over time have created a system for creating the most sophisticated and essentially the most efficient cow, or dairy-producing cows in the world. And it’s one thing to talk about it, but it turns out there’s an ISV that’s built a solution specific to this industry and I’m going to run a short video from SCR around the Healthy Cow 24.
(Video segment.)
(Applause.)
I don’t think anything tells the story better than that video. I really like the little stroller for the calving icon, the notion of pushing a calf around in the stroller. Now you might think, OK, well, that technology is there. This is solved there’s no other opportunities. But, it turns out there’s lot of opportunities. AfiMilk is another company in Israel that basically helps look at the milk as it’s being produced and processed and helps separate regular milk from coagulated milk. Traditionally you take all the milk, you put it into one big container and you separate it afterwards. Well, what happens is you have loss there and you’re not as efficient. Doing it real-time, separating milk for drinking from milk used for cheese makes the system overall more efficient. And that goes back into the system overall of how we get more milk per cow.
But, there’s another step beyond that. There’s AKOL, which is the Agricultural Knowledge Online Group. It’s essentially Israel’s dairy cloud. About two-thirds of the farms in Israel participate and what happens is they share knowledge. They use a common set of vets. They share best practices. They share learnings. They work together with the regulators. They work together with the healthcare or the vets, providers with suppliers, and help make the overall industry more efficient as a whole working together.
So across these three companies and others there’s incredible work going on. And we’re really proud to work with them. These companies use Azure on the back end. They’re using SQL on the back end for the data. They’re using machine learning tools that started with Joseph and the work he’s doing. And collectively the industry is transforming.
I think it’s an incredible opportunity in terms of a case study for change of any given industry. Now we see it everywhere. I get to talk to partners big and small, new and existing, and at every junction, at every place it’s happening. Music, Music is a small company in Florida that takes drum sticks, puts Bluetooth sensors in there, accelerometers and allows you to play drums using the PC as your front end. You don’t need a full drum set. Put a pair of headphones on, thankfully for children, and now you can play a full set of drums without having to have a full kit in front of you. It’s great feedback. It’s very disruptive.
Jet, if you thought about Amazon disrupting retail, how many years ago was it, Jet wants to use machine learning, again Azure on the back end, to change the dynamic and be disruptive again to online retail and use machine learning to better develop and better provide users with goods at more cost-effective prices.
Now in a cloud era there are many cloud providers. Ignite is a good example of a partner who is working to provide a security management layer across storage, on-premises storage, cloud storage, cloud storage from Microsoft and cloud storage from other providers, and also connecting back into the experiences. Think of Office 365 experience, think of something like DocuSign and providing a security and management layer that honestly can be disruptive across all the cloud providers. So it’s a good story of how people are doing this type of work. And we see it in other areas, the container work that Docker is doing, many other places.
Now, along with the startups that are out there, there’s a set of sort of growing or existing companies. Salesforce, obviously with Salesforce we have a couple of areas we overlap, but at the same time we’re working hard to be disruptive together. How do you take Office 365 as a SaaS service, right, No. 1 productivity service on the planet, connected with Salesforce.com, their CRM service, and bring those together to enable a new set of capabilities. And then think about what we can do with Windows 10 and with Azure and other areas.
On the sports side Red Bull Racing, we worked with the pilot. The pilot says instinctually I’ve done racing for a long time. It turns out if you apply machine learning and a lot of time we were actually able to help the pilot shave literally seconds or a second off of the flight, which is all that matters. And if you look across any sports league — NFL, NASCAR, NASCAR using Surface devices in the pits themselves to check the cars, wanting to use media to give viewers more angles, wanting to use the cloud to get better learning relative to the racecars, things that Formula 1 has done for a long time, Real Madrid — the sports industry is just sort of revolutionizing itself.
And I work with a set of ISVs that are right there hand-in-hand with them helping them reinvent themselves. Obviously every traditional ISV, I mentioned some healthcare ones this morning, Schlumberger, how do you use the cloud and machine learning to think about oil and gas research start over in terms of saving some of the CAPEX that’s required to do the research today to find oil.
Siemens, Siemens literally when you think of rocket science and building rockets they’re using Surface Pro and Surface Hub to allow people to collaborate to use inking, to work together on the design of very sophisticated devices that we ultimately use. So many, many, many others, I apologize to the ISVs I didn’t mention, because everybody in this room is essentially an ISV and is doing some work in here.
My question to you is, which part of this curve are you going to be on? Are you being aggressive in thinking about reinventing yourself around driving disruption in your own company or in your own organization, or helping others do the same? We’re here to help.
On the ISV and the developer side, we have a set of tools both for technology and education as well as for go to market and the business side. Obviously, for this audience, starting with the Microsoft Partner Network is a great place to begin.
Below that is the Microsoft Developer Network. On MSDN we provide links into all of our services, all of our training materials, sample code, where our events are, anything a developer would need to find the information they would want to get going. If you want real-time videos for technology, Channel 9 is there. If you want more of a structured learning environment, both our learning and certification partners that are here in the room, along with the Microsoft Virtual Academy, are there. If you need help, if you’re working on something, the Microsoft Most Valuable Partners are in the community working to help provide feedback against all of the technologies we build. So there’s a plethora of tools for your developers and for the ISVs in the room.
Now, when it comes to the business side, we want to find and work with you. We will be at events. We host our own, we show up at others. The next show, I’m going to tell you — the next thing we’ll do is we will work with you on ideation sessions. So if you want to come in and sort of sit down and think about how you reimagine your business or where you’re going, we’ll start with the conversation about what technology offers, move to an architecture design session. From there, if it’s appropriate, we’ll run a hack session. We’ll sit side-by-side and code with you. We have places to do this around the world. We use our Innovation Centers, which are in more than 100 countries, to do this.
Our Microsoft Ventures team is working with accelerators and using our own accelerators to help startups get going. We have programs for startups like BizSpark. And then last, but not least, the hardest part of the final piece, how do you use the marketplaces and go to market to bring the ISVs together with the partners in this room together with customers to ultimately help people find the solutions that are most important to them, and help them as they move their journey forward.
And that’s the last step of the puzzle that we’re investing an incredible energy on this year. We won’t be perfect on Day 1, but that last mile step, the combination of marketplaces across Azure and Office and Windows, and really for business, for consumers, for education and then the tools to go with it are what we’re working on to bring all the pieces together.
I’m going to use my final story on a company called Unit4. Unit4 is an ISV in Europe, very successful in the ERP space. Thousands of large enterprise customers, but not everybody knows them. We met with them for an ideation session about a year ago. And they said, gosh, we’re at a point now where we have to think about how we reinvent our business. We know we want to go to the cloud. We know we want to take advantage of it. And we went from ideation session to a hackfest, to working together, and they are now in the process of building and delivering a completely reinvented solution.
In this particular case many of us think about or have heard about the quote self-driving car. You have a large number of sensors in a car. You feed the data back into the cloud. You use machine learning to help you and you help automate that car.
Unit4 is working on creating self-driving ERP. Take all the information from Windows devices, from Office 365, feed it to the cloud, use machine learning to help you, ultimately make ERP more automated and more self-driven, essentially, from their work. So take a picture of a receipt, while you’re here at Worldwide Partner Conference, have it go up into the cloud, be parsed, automatically feed into the expense report. If you forget a receipt, or you’re missing something, have the system tell you automatically. So how do you use all the technologies to drive this forward?
And the best part of this particular story is I met with Unit4 while I was here. Their CMO is here, their chief technology officer, and they want that last mile. What they’re actually looking for beyond just working with us on the technology to enable self-driven ERP is a set of partners to help them bring that to market. So there’s a set of ISVs that are looking for you for how do we partner going forward to bring solutions to market? Unit4 is here. They’re looking for folks in this audience for North America, for other parts of the world, to help them with that mile step, which is about closing the gap for them in terms of delivering their solution to customers.
So with that I ask you, how can we be disruptive together? How can we help you? Whether it’s on the technology side or the business side, whether it’s building solutions, whether it’s doing the go to market work, we’re here to help. We have folks all around the world. We want to work with the ISVs. We want to help everyone who is an ISV or becoming one. We want to help you on both sides of this.
If you have any questions, ask Steve Guggs. And with that I wish you a great conference and have a good time.
(Applause.)
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