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<no clicks>Let's start by talking a little bit about what trends are unfolding in the market and how they affect the data center and our customers’ IT investments.First, at the industry level, there is a fundamental shift toward cloud computing, and that means there is a new breed of applications that need to be built:New apps need must reach cloud-scale.They need to be accessible 24/7 from anywhere.And they need to be deployable on-premises, in the cloud and in hybrid environments.The consumers of these applications and data are largely end users with an increasing variety of devices and a mobile work style that allows them to be productive from those devices wherever they are, whenever they want. The demand for ubiquitous applications with access to data from anywhere and to anywhere and data has been triggering a data explosion with data volume expected to grow by double-digit percentages. And finally, of course, the entire way computing is done is changing: Cloud computing has replaced the tradition of tying specific applications to specific servers with the concept of pooled resources – compute, storage, and network resources – that enable IT to deploy applications as elastic self-service services.Along with the changes in customer demand, have come innovations in technology that help enable and support many of the before-mentioned scenarios while allowing IT to run well-managed and efficient datacenter operations. When you talk about the modern data center, it's perhaps best to start with what's happening at the system level, what's happening with chips, what's happening to a single blade, a single system, and cluster.The fundamental thing that all of us at this point are tracking pretty closely is the notion that storage, compute, and network are co-evolving.At the compute-level, more powerful, multi-core chips are entering the datacenter every day, and while the density of memory keeps going up, the cost of memory keeps going down. Once you have a lot of compute power, you need the IOPS to go with it. And so the revolution in storage, especially around tiers, is what's in full play, because the disk speed itself is not something that's going to go much faster, but at the same time the fact that SSD costs and Flash costs are coming down provides a huge opportunity for the datacenter. The trend to less expensive storage solutions that offer higher performance means that industry-standard hardware will be used as reliable and available, low-cost storage devices. Finally, with lots of compute and storage resources, the last thing you would want is the network to become a bottleneck. But fortunately, fast interconnects between storage and compute nodes have emerged which are also driving a lot of innovation.In addition, high-speed Ethernet and network offload technologies such as RDMA have become mainstream. For these reasons, on top of some of the massive component improvements, the compute, storage and networking infrastructure has converged to allow for an easy, pre-assembled appliance experience in the modern datacenter withclustered systems of multiple servers in a single enclosure.But, the key to this co-evolution of storage, compute and network is really software control. You cannot afford to have control fragmentation, because if you do that then you're not going to be able to achieve the economic benefits, the agility benefits and the innovation benefits that these new systems at high density can provide.<click to next slide>

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