Techstrong Gang – February 12, 2025

Hello everybody, and welcome to the latest episode of the Text Drawing Gang. We've got a I PCs today, a feud between AI robber barons, and a debate over, well, what's going on with finops. You're watching Textron Gang, and we'll be back in a minute.

Hey folks, I'm your host for today, Mike Baard, and we got an awesome lineup of folks today starting with our friends in California. Once again, John Schwartz is out there in the Bay Area. John, how are you?

I'm doing good. I'd rather be here on a big Gang. Excellent.

Also out in the Bay Area. Lisa Martin, our resident, and CMO advisor, expert at the Futureum Group. Lisa, good to see you again.

Good to see you too. I'm excited for today's game. All right.

Going, I guess clockwise. I hope maybe everybody sees it the way I see it, but Amanda Ani is down in Texas. I How cold is it in Texas these days?

Is it is? It's in the forties all last week. It was high eighties and now it's in the forties.

Wow. Also hanging out in Texas. Guy Courier.

Yeah, in central Texas where I might hit 60 today, but more to the point, it's like not just cold, it's like a little windy and like wet and ugly. Maybe that's why I'm so cranky. Or maybe it's because my, uh, because of my horrible Superbowl prediction.

Well, that could be too. And finally, Steven Foss in Ohio, where it's as cold as it is where I am in New York. Steven, how you doing?

It's as cold as ice. I'm willing to pay the price though. Oh, man.

Ice Foreigner reference. I saw that tour, by the way. Hey, don't call me a foreigner.

I wanna stay here in America. Alright, Noted. We Somebody, we'll, we'll do something about that.

Somebody, somebody check his birth certificate. All right, we're moving on. No need.

We can just declare him a foreigner. All right, well, let's get into our first topic of the day, which is a, I PCs our friends over at the FU group have a new report out suggesting that enterprises might start buying these things earlier than anticipated to future proof, as it were, because well, yeah, they tend to hold onto these things for a few years, but John, you wrote this report. What's your take on what's going on here?

Um, is it realistic or is it wishful thinking? It's probably both. I mean, there's a, there's elements of it that are real, but I think it is in terms of wishful thinking.

So the group talked to 852 enterprise IT decision makers this year, and, um, they came away with three major findings that, number one, about more than half build this need for their workforce to be more competitive as quickly as possible. So I guess the idea is you put the technology in front of people, people on an everyday basis and kind of force them to learn it or at least adapt to it. The second reason, which is tied to the first is that nearly half identified the impending end into Windows 10 support as a critical priority.

And then a third pointed out the necessity for improvement in system performance. Now, the, the thing that is interesting to me, and it was not in the story because it just came out, there's a Wedbush securities report that shows that the budget for AI is probably roughly gonna be in the 10 to 15% range this year up from single digits, which shows this kind of acceleration of an a AI strategy over the next six to nine months. So there is like this discernible movement going on.

Um, and I think that the AI PCs may play a, a, a piece of it. I'm not sure how significant. I think there's still some sort of roadblocks, for instance, in those, uh, FU survey, 36% were concerned about the higher unit price of a I PCs and related costs, such as subscriptions to feature enabling services, um, uh, about a fourth side of the concern over the ability of A IPC to run critical enterprise software natively.

So there are still obstacles, but I think it is definitely moving in this direction. But, you know, seeing is believing I, the, the, the idea is it's go time. Um, we'll see, I know, I, I have a, a measure of skepticism about it, but there you have it.

Guy, you wanna jump in here? Well, yeah, I've been saying, uh, all along, you know, here and elsewhere that, uh, the, the AI movement feels a lot like the PC movement to me from back in the eighties, which was in the case of the pc, about 20 years of investment purchases, use, all that sort of stuff, while the economists were scratching their head and saying, well, we don't see any productivity gains. The benefits were so obvious that nobody was sitting around and measuring productivity.

Nonetheless, that sort of business, bottom line, there was an adjustment to be made. People had to be trained. And then eventually we started to see it.

I think that we're gonna see that return on investment, um, for AI generally a lot quicker than in 20 years, but it's the same basic thing. The benefits and usefulness are so obvious that investment is just going up without people sitting around trying to calculate the productivity or other gains. But I do wanna say this.

So when it comes to AI PCs specifically, I think that that's the movement. It's just there seems to be an obvious benefit. So it shops are investing in it, but I also kinda wonder if, if we know like what an A IPC is, I mean, you know, on this, in this group, uh, we can, you know, come probably'll come up with a reasonable definition.

But I'm, I'm wondering, uh, at Lisa and, and Amanda, I think of you guys having sort of your pulse on popular sentiment. Do people know that an A IP PC is a PC that is tailored for local inference? Or do they think something else, like it's something that helps create ai?

I I think that a lot of people are thinking the latter. Yeah. I think a lot of people really are not clear on what an a I PC is.

You nailed it. Yeah, I agree with that. From a messaging perspective, I think it's not clear what that is.

Um, from an inferencing perspective, I think the average person doesn't understand that. And so they think, is it, is it an a PC with AI and built into the hardware and software, can I create AI with it? I think there needs to be some more definition and clarity around what it is.

Mm-hmm. What those clear benefits are to any type of organization, retail, any other industry. All right.

Well, as it happens, Steven fki has a video last year defining what an A IPC was, and it was one of the most watched videos he did all year long. So Steven, what the heck is an AI pc? Thank you, Mike.

Uh, yeah, I think a guy was maybe there when I recorded this live at a tech field day event. Um, yeah. And the, and it's, it's funny because it, obviously this video hit a nerve because that's the title, what is an I pc?

And so people are searching this and they're trying to figure it out. Um, essentially, uh, it, what Lisa said is, is right on. It's not just hardware, it's hardware and software.

And that is the important aspect to me of, you know, what is an A IPC? You'll notice as well that in the Futurum study, um, they talk about not just Qualcomms Snapdragon X versus X 86, they talk about Apple, and remember that Apple is right there. I mean, we sometimes use the, the, those two letters PC to exclude Apple, but in this case, apple is right there making AI PCs as well.

And what I said in the video, and this is like, I, I, you know, I think what people need to know and what as, as you know, you just mentioned Lisa, that that people don't seem to know is, um, you know, it, it's all about running AI locally on your local data, on your local machine, but it's not just about horsepower. Now, certainly Snapdragon X and the Apple M Series have incredible horsepower for pro doing AI performance tasks, and Intel and a MD are not asleep at the wheel. They have also introduced incredible chips that can, I mean, it's, it's, it's hilarious because I mean, they're right there with, with chips that can do the same thing.

Um, but it's not about hardware as much as it is. Well, I mean, hardware is a necessity. It's about software and it's about integration, and it's about having those models at your fingertips.

Companies like Microsoft and Salesforce and Slack and Dropbox and, and all these other companies are trying to bring that software natively into the interface. Uh, you know, Microsoft now has, you know, co-pilot in the ribbon on office apps. Uh, you know, that's when AI becomes real.

It, it can't happen until you have a PC that can handle the, the, the, the, the computing. But it also can't happen until, you know, Joe in accounting mm-hmm. Jane in software development has that co-pilot icon on her desktop and, and, and, and, and knows how to Use it, The desire to use it.

Right. That's, see, that's The, yeah, those are the two things, right? First, we keep So much about it.

What, you know what guys, let's just buy right now and we'll figure that out later, maybe in the third or fourth generation of A IPC that we buy. I mean, that really isn't that what's happening? So some, so I have a question.

So you say it's more about the software, it is about the hardware too supporting, but, um, I imagine a lot of people would say, well then, um, can't I just make my current computer be an AI pc? Because all the shared AI software, I mean, we see the copilot. I already have copilot, already have chat.

GPTI already have Canva ai, like, can't I just use a bunch of shared AI software and I have an AI pc? It's, it's a, it's a really good point. And I think that in some ways the AI industry may have done themselves a disservice by rushing this stuff out with cloud-based applications, because essentially, as, as you're saying, yeah, absolutely.

That copilot, um, icon appears whether you have an AI PC or not. And in many cases, you know, I mean, you look at chat gp t's incredible success. It's running in the cloud, you don't need an A IPC to run chat GPT, you can run it on your old iPhone se, even though it's not actually running on your old iPhone, you know, it's, it's running in the cloud.

But to you, does it matter? And Apple has done an incredible job as well of seamlessly integrating cloud and local processing to the point that even if you have the latest and greatest M four, you know, iPad or Mac or, or, or the latest iPhone, um, you don't know, and you can't know whether it's running locally or in the cloud. And that kind of undercuts this entire discussion because if, if all this stuff can run whether you have an A IPC or not, then what's the point?

Yeah. Mm-hmm. All right.

Think about this slightly differently. com boom, I went toe to toe with A CFO, who subsequently became one of my best friends. But at the time, you know, he was arguing we didn't need new PCs to support a publishing staff.

That was at the time, moving into the brave new world of online publishing. And everybody's laptops were crashing and stories were getting lost and people were losing their minds. And, um, but for whatever reason, you know, he was still on this, well, we're gonna upgrade every three year kind of cycle.

Fast forward to today, I would've just told him to bugger off and went out and bought a bunch of PCs myself and just handed them out to folks and said, you know, this is our new units and this is what we're doing. So guy who cares what the CIO or the CFO thinks anymore, people are just gonna do shadow it and do what they need to do when they need to do it. Well, I think that's a great follow up to Steven's comment because with a certain level of, like, one of the things that I'm really hot on right now is Edge ai.

Steven helped get me there, by the way. I have to say, uh, and, and, and work with the tech field in with him. Why?

So that answers your question, Amanda, but it's a technical question. Where should processing occur? Should it occur at the core or should it occur at the edge?

This is an architectural question. This is an application architecture and design question. Like Steven says, like, Apple's done a phenomenal job with this sort of thing.

So Mike, I don't see any reason if you got the money not to invest in what amounts to an Edge AI capability, that's the IPC recognizing that maybe it'll never be used. So I agree with you just go, take out who cares what the CIO and the CFO says, well, you care. You're ahead of a business unit.

You care about your bottom line. You wanna show ROI, you invest in all kinds of things all over the place, technological and non-technological, like fancy group dinners or something like that, that you're not gonna sit there and justify, hey, this particular thing had this ROI, especially if it has AI attached to it. In fact, let's just attach AI to everything that we wanna buy, whether it really is AI or not, and then everybody will let us buy it.

Uh, John, what do you think the odds are that an AI PC is gonna cost a lot more in three months due to a tariff than it does today? That's a good point. Yeah.

Everything is gonna cost a lot more. You know what I was gonna go back to, um, something we were talking about Apple in terms of organic growth and shadow adoption of, of a pc or in the case of a mac. I mean, it will find a way, and I think, I suspect that might happen with AI in a certain sense.

You know, it's always driven by software, you know, hardware is important, but that underlying use from the the user is, is, is just important. Yeah. That, that's, that's interesting.

Mike, with given, given the, uh, tariffs that are going to be in effect, does that kind of negates the, or, or kind of put in put a, a kibosh on the enthusiasm? Some of some folks when they look at their budgets? I mean, it's something we should probably take a look at, and I think it's probably gonna happen in some form.

I know. Steven, you wanna jump in here a little bit in terms of predictions for A IPC costs going up, down. What's your thought?

Well, with the CHIPS Act, I think there's a good chance that we might, uh, actually be manufacturing some of this stuff locally. I mean, uh, the news, uh, coming out of Apple is that they just, uh, produced their first, uh, US made, uh, processor, um, in, uh, TSMC, I think it is T SM C factory. Um, I, I think that we are going to see some homegrown chips, but of course, um, it's complicated as they say, because it's not just, uh, etching the chips, it's packaging, it's manufacturing, uh, final assembly, uh, distribution, all those things that matter.

And tariffs could get in the way of a lot of that because it is a globally interconnected supply chain. So I'll say that I believe that we will probably be seeing, um, costs for literally everything go up in the face of tariffs, because that's what tariffs are. That's what they do, and that's what's gonna happen.

All right. I'm betting to be, the PCs will be assembled in The Bahamas to get around the tariffs. That's, Hey, That happened a lot in the sixties and seventies when we had a big, uh, international tariff regime.

There was a lot of outsourcing, uh, to the US Virgin Islands and Puerto Rico and places like that. Interesting. Lisa, I wanna give you the last word on this.

You know, guy and Steven talked about this a little bit, but is there a branding marketing issue around IPCs and the way we use the term and ca and do we need to kind of revisit this whole conversation? I think so. I think a, as I mentioned earlier, I think from a clarity and a definition perspective, it needs to be that really clearly defined the future of study that John started this block up with, shows that a lot of organizations are really looking at IPCs to be more competitive.

Well, what does that mean? Um, competitive differentiation is incredibly important to every type of business. But how will an A IPC if I'm a, a retailer, help me get there?

I think from a clarity perspective, the messaging needs to be refined. The benefits need to be really clear so organizations understand, do I invest now to your point on the tariffs, or do I wait if I wait, my costs go up. But I think they, that the marketing folks, they talk about future proofing, and that's always one of those marketing terms that bothers me because it means something different to everybody, or it doesn't really mean anything.

Um, what is, you know, future proofing what A IPC, future proofing what my business, how? Um, so I think there's, there's a lot of, of wiggle room in an A IPC definition currently stayed and kind of nailed it with, with what should be done. So organizations can really make the the right investment decision as to whether they really need it right now or not.

All right. I'm gonna tell you where you can find future proofing. It's right here on Techstrong TV where you get the knowledge you need to make the right decisions in the future.

There you go. All right. We'll be back in a minute.

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Contact us today and tell your story to the world in the most powerful way with Techron Group. Hey, folks, we're back, and we're gonna be talking about this bid that Elon Musk and a bunch of investors are making for open ai. And geez, you just can't make this stuff up.

It's right out of Robert Barons and the Gilded Age. Lisa. I mean, I don't think, at least from where I sit, I'm not sure that this is even a serious thing, because last time I checked the company was worth more than the bid.

And I don't think that they actually have to respond because they're not really structured like a typical company. But from your perspective, um, is this kind of outta hand or is this, you know, just silliness? Where are we going with this thing?

I, I think it's out of hand and silliness. It's Elon. When I heard it very early this morning, the news, I just thought very goes again.

And we were talking before we went live about the chaos that ensues when, when Elon opens his mouth and offers a bid. You know, the, I the irony in it is that he was one of the co-founders back in 2015 with Sam Altman. Um, Elon is is a top advisor to President Trump, which was something I never expected to see.

And I've followed Elon for a long time. But, and then of course, open AI with SoftBank and Oracle and Project Stargate, what they're doing there to invest in AI infrastructure in the States. Um, clearly Sam Altman didn't take it seriously with his re response, but I do vote for Sam Altman to buy X as he joked about.

I think that could make, bring, bring back the Twitter name. But I think, I think it's just, it, it is silly. I think it's Elon flexing once again.

And I, and I think from, I always think, man, what was his marketing? People think it must, that must drag them crazy that they can't control the message. 'cause he's just gonna say whatever he wants.

Um, now is, is X AI better than open A? I don't use X AI personally, I use GR with a Q, but I think that it's, it's Elon going rogue, and I think it's just to probably tie up things for open AI's next steps, which it wants to do, and we'll have to wait and see how much that affects what those next step plans are. Um, I think it's a bit of thud personally.

So I had so many thoughts rolling in my own head, and I'll tell you what those were, and then I put it, um, I put it out on social media to ask what other people think. But my first thought was, I'm not sure I like one person having control of any number of like all of the basically databases, like he already is in control of X. And then we have Sam in control of chat, GPTI would say, I don't want one person controlling all these systems because that's essentially such a huge amount of data that he has and what's he gonna do with it.

And also, it's another platform to essentially manipulate society in a way. I mean, you could, one, giving one person control of all these different platforms, that's a little scary. So secondly, I put this out on, um, social media though, just to see what people think.

You know, I put, Hey, he offered this much, um, what do you think? Um, why did you know, why did he put a bid? And so some of the, um, responses were, um, because it is the hottest tech, he believes he can run it better.

He enjoys limelight and positioning of power and money. And then somebody else put, um, to expand on that, um, they put essentially, you know, it was a very long paragraph, but essentially, um, because, um, it's worth, it could be worth trillions in the long run. And that resources in the end are more important than money in the first place.

And when you think of people of real power, while we're trying to just pay bills and enjoy life, they think in m pavillion terms, dynasties, um, somebody else put, um, uh, uh, all you have to do is, um, go watch the Netflix docu film on Cambridge Analytics and you'll understand what's going on. So I don't know if anybody's seen that. Uh, and, and then let's see, uh, because, um, Elon may not be entirely human joking, not joking, because ai, avatar hybrids are legitimate potential future.

And there are organization organizations deeper and darker than 99% of humans ever see and would ever believe. And there are things working under in Pandora's Bach that are broader and deeper than we know. Okay.

There are some of the answers that you have from, from my best, John, What are John, what are they saying in the Valley about all this? Because, um, you know, right from where, from where I sit, this is like, you know, do I like Andrew Carnegie better than John Rockefeller? I don't know.

They're all the same. Yeah, they're all, they're all despised out here as well as the rest of the country. Uh, you know, the one thing that I, when it always comes to Elon, there's always like an end game.

You know, there's, there's the short game and then there's the end game, and then there's a game that he hasn't even imagined yet in his adult brain. And, um, and he has taken, there was a legal action by Musk against open AI to force open AI to auction off a portion of his business. And I'm wondering, by making this bid as absurd as it may sound on the surface, whether he's trying to force or maybe elicit other types of bids or, or force open AI to consider other offers, or at least entertain the idea of an auction because they are moving towards a for-profit status.

Um, you're right, you mentioned earlier that the, uh, the amount they're offering is literally half of what OpenAI is valued at. So no, OpenAI is valued at about 160 billion, but there is a rumor that there will be another cash infusion, another round of funding that will elevate it to 260 billion. So, um, in, in a sense, I think he's, he's trying to muck with a company that he personally despises and a guy that he chooses his mortal enemy in the sense of Sam Altman.

I think this is all, a lot of, a lot of Machiavellian twists and turns, but I also think there is some sort of end game to try to compromise open AI as a company. Yeah. If I can dive in on that one, I think that you, you know, you're, you're right there, John.

It's still early hours of us digesting this. And so, but to me, the thing that caught my eye, uh, let's be clear. Oh, Elon Musk is not bidding almost a hundred and, and his team and his alleged, uh, uh, I was gonna say co-conspirator, not exactly the right way to say it.

Um, his alleged consortium is not bidding for open ai, the makers of chat, PPT, let's be clear, this is a bid for the, a nonprofit organization that, that controls open ai, right? Correct. Yes.

But, and remember the valuation that you just talked about is the valuation of OpenAI, the for-profit company, and open AI's assets. What Elon Musk is doing here, I think has nothing to do with taking over OpenAI. I know that, you know, you say Elon Musk and everybody just loses their stuff.

What's happening, which I'm about to do, but please continue, feel free. I'm just gonna say it 12 more times until your head explodes. Um, what's happening here is this is absolutely the actions of, of, you know, back to Mike, what Mike said at the beginning.

This is robber barons fighting robber barons. And what he's doing here is by offering this thirdly high, no, I mean, that's the thing. This is not a low ball offer.

org kind of aspect by offering an insanely absurdly high amount for the nonprofit. He has just set the bar that says that when the for-profit entity wants to split from the nonprofit or wants to go public, or wants to kind of cash in on this absurd valuation, what they're gonna have to do is they're gonna have to beat that amount to, they're gonna have to pay that amount to the nonprofit, because at that point, all the shareholders, everybody involved will say, wait a second, you know, you wanna split from the nonprofit and you wanna give them some money. Previously that some money might have been a billion dollars or something.

Now that some money has to be over a hundred billion dollars, which means that OpenAI, the company is going to base, it's just Elon Musk, just force them to flush a hundred billion dollars down the toilet on nothing. Or he's gonna swoop in and have some kind of really valuable minority or maybe even majority shareholder stake in that eventual public entity. And, and so this is pretty much, I don't wanna say a checkmate, this is a certainly a check on the chess board, and it has nothing to do with Elon Musk actually wanting to take over OpenAI.

He's just forcing them to overpay. I've been dying to jump in here, man. Not exactly dying, I'm just shaking my head.

So let me start with one thing. Elon Musk. Elon Musk.

Elon Musk, it's not Elon Musk derangement syndrome. Promise. Is that, that like Beetlejuice, where were you going with that?

Uhoh? Yeah, I guess so. Look, there is no offer, okay, open ai, profit, nonprofit, whoever, Sam Altman, nobody has seen an offer.

And so this is another case, yet another 99 times out of a hundred, uh, uh, of Elon Musk saying some s**t and everybody taking it seriously. If there's anyone in the universe whom you should pay attention to what they do, rather than what they say, it's that guy. I thought it was a different guy Over and over and over and over again.

He just said, now he just said some s**t and wound up buying Twitter at one time, he just put, posted a price when he was maxing and relaxing and chatting with who knows who, and you just posted a price publicly and he wound up having to pay for it didn't work out. So every now and then, right, that happens. But he is just saying, and you know, the, the, the, the elephant in the room, the freaking like, I dunno, mammoth in the room that no one, none of the reporting is talking about is this is an employee of the US government.

This is a presidential appointee in the office of digital services in the federal government. Who is, I mean, you kind of alluded to that, Mike, and talking about, you know, oligarchs and stuff, right? His statements are a representative statement of the US government as well, because he is an officer, a compensated officer of the US government, not confirmed, all right, so a he's just saying whatever, and everybody's like, they're writing articles and they're examining, we're all doing this, we're examining it, we're looking at the strategy, the chess board and all that other sort of stuff.

I'm just saying, he just said something and that's it. It's great Marketing for himself, right? And all the open ai.

Yeah. There, there's a little something I I I, I like this, like deconstruction of the strategy that Tor puts the Open AI board and the funny place and all that other sort of stuff. So I'm not saying there's no motivation, there's no effect of him saying it, but really, honestly, that's all he is doing.

Well know, you know, once again, there's nothing here. Right, right. In a sense, what he did was like the other guy, you know, who we, we've alluded to, it's a diversionary thing for a day or two.

We're gonna talk about this, then we'll forget about it, and we conveniently will overlook what's going on with Doge, which actually is the real story involving Musk. This is something he does, but he also wants to inflict some sort of damage and screw around. I, I was gonna use another word with, with open ai.

I mean, it's something he does. Larry Ellison would do the same thing. Remember Larry Ellison had a history of saying, I think I'm gonna buy this company, or I think I'm gonna do this, you know, instead everybody two.

But they didn't do it just thoughtfully just spitting out crap, Ola, it's crap, Ola, there's no intent behind. There's no offer. There's no offer here.

There's just a statement. Yeah. And we live in a time when people can say just random stuff and, um, and have it move markets.

So, but do you think he would've actually paid it if Sam Altman accepted the offer? Do you think he would've actually paid it? Bought it?

That's The question. He, He's, he's forced to essentially, other than the conflict of interest of working, of being a federal, uh, officer, he's forced to, just like with Twitter, okay, so he would be forced to just like he had to with Twitter, but Just like with Twitter, he doesn't actually have this liquid cash and then this consortium of people that are supposedly gonna be buying it. But that being said, I think if, um, if the OpenAI, again, nonprofit wanted to accept this offer, I think there would be no shortage of funds and capital at this point to fund it and make it happen, because that would effectively give a, for $97 billion control of a 200 or $400 billion company.

And that's just a valuable commodity. Lisa Martin, is this the future of conversations between CEOs where they text to each other and then they share it with the press and you have, you know, one CEO calling another CEO allegedly a swindler. I mean, how crazy can this get Well with Elon?

I think it, I think that the level of crazy could definitely go up. I hope this is not the way that CEOs communicate. I think this, he's an outlier in that and an extreme.

Um, but I think executive communications would come in to most organizations and put guardrails around what the CEO is doing so that the organization doesn't get derailed itself, ultimately serving its customers and delivering the value that they expect. So I, I think the level of crazy, I think, uh, you know, we're probably scratching the surface with Elon. Um, it's a bit comical.

You, you mentioned the, the word swindler being used. I saw that this morning, and it's just, it's, it's silliness. Um, really what it is.

And to guy's point, there's no real offer. This is, this is fud, this is out there. He, maybe he's trying to slow open AI's plans to go for profit down, um, or provide a forcing function for the nonprofit that owns it.

But these communications shouldn't be happening at this level, um, for a healthy organization, in my opinion. Mm-hmm. John, is there room for a white knight in this conversation?

Because there's a lot of people who don't like any of the players involved. So is there room part of Yeah. Well, Microsoft's invested, what, 14?

I've lost track. It's $14 billion into open ai. Um, I, I don't know.

I mean, it's so early we went through the same conversation, right? Although we did buy Twitter, I mean, for, for a long time, we dismissed that idea. Um, and there were White Knight that emerged during that, that were tended to be big, be big tech.

My fear always has been, and I think the fear out here and everywhere is that if open AI were to be sold, it's the, the feeling is that given the climate now in terms of, uh, deregulation in terms of m and a activity, that somebody in big tech is gonna end up owning it. So we're gonna have AI in the hands of maybe three or four major, major monster tech companies. That's the, that's the long-term anxiety.

Uh, well, here's my bet on it is that we'll watch this drama play out for a few months, and then, um, hopefully cooler heads will eventually prevail and we'll say, you know, we need some serious adult supervision, because clearly these folks are not, shouldn't be allowed to play with things that might go boom. So I'm just thinking that, yeah, a lot of folks are gonna go, you know what? These guys are not the guys to trust in this situation, but we'll see how it all plays out.

We'll be back in a minute. All right, everybody, we're back and we're gonna talk about money again, but this time in the concept is called fin, which is the notion that somehow or other we're gonna programmatically put some controls in place to limit our cloud spending and other IT spending and keep that in track with our policies, Is what I have At house back in the day. I seem to remember when, you know, this was called how we run it, but Guy, what's your sense of, uh, is finops for real here?

Because we're already seeing, for example, finops companies buying IT service management companies, and we're also seeing it SM people just start putting in finops capabilities alongside what they already have. So do I need a finops platform? Oh, I think you do, but is it an exclusively finops platform?

I think that, that it was a really necessary area of, uh, cloud development because of shadow IT and Cloud blo and like, you know, all all that sort of thing. Um, and I think, uh, you have pointed out really well in a lot of venues, Mike, um, that Kubernetes also is this sort of enabling of, let's call it bloat waste over capacity, that sort of thing. All of these are cost and, uh, the, the very nature of the cloud and, and frankly of like, you know, DevOps and Kubernetes is to be able to be extremely elastic and responsive, um, and, uh, to, um, not sidestep exactly, but, but to be able to operate without a bunch of bean counters or, um, you know, uh, frankly, IT infrastructure people or whatever, kind of getting in your way so you can move fast, break things, blah, blah, blah.

Okay. So what arose out of that was a 'cause if, if we all remember the good grand old days was how, uh, cloud was gonna save you money. And then everybody started to realize they actually cloud cost more money.

And I'm talking most about public cloud. And so as a thing, as a separate thing, finops a platform, a practice finops is more a practice than platforms, really. Um, there's, there's a whole, you know, very successful, uh, uh, uh, consultancy industry, um, around controlling cloud costs in particular, and that that stretches out into containers and on-prem and all that other sort of thing.

So, so all that is for the good that that's, that sort of shines a light on the whole issue, but in the end, and what of these recent acquisitions, um, like, uh, uh, do it acquiring perfect scale, I think you just wrote about that yesterday or the other day. Um, these kinds of moves, um, to bring all of these operations under one umbrella and in particular to, not to stop saying it's just public cloud, but it's all of our infrastructure, all of our cloudified on demand, you know, scalable infrastructure that we need to out, you know, provide the freedom to the developers and application managers to do what they need to do, but also enforce policies in a way so that they can do it quickly, but also not overdue or, you know, that all of this needs to be integrated together. And so if one day we're not calling it talking about finops anymore, and it's just part of cloud ops, great if, uh, we'll still need finops experts, finops practitioners, some of them should be in the financial departments as well.

So now I think, I think this is not only a good and welcome development, but you know, I, unusually for me, I don't see any problem with having this sort of marketing term of finops out there that shines a light on a really important issue that actually is what helps cloudification containerization, all of AI ization, all those things, you know, develop rapidly. What I found was interesting about that article when I read it was, um, when it said finops has, uh, been known to focus more on reducing costs, whereas they really should focus on increasing value. And there's a little bit of difference what focus you come from, and that's why teaming up with a cloud ops team who's utilizing, um, that area, uh, what is helpful, coming together with two different teams, one focused on bringing the value.

I think that's right percent on it. I, I would just dispute, uh, I I think that, um, cost control and sprawl and all those sort of things are much more the issue than value delivery. I, I, I, I think shining a light on value delivery and getting the most out of what you got is, is correct because yeah, one overshadows the other, but I think the, the pre predominance, uh, the predominant focus really does need to be on cost and, and sprawl control.

I think, I think cost and sprawl control is a, is is sort of the, the useful outcome from finops that allows this to take hold and allows companies to embrace it because it's, it's, it's a great, uh, sales message that says, we're gonna save you money, you know, we're gonna address the money that you're wasting. But truly, I, I have to say, I really found this article incredible inspiring. Um, I, I love the, the, the author's perspective on this.

I, I'm gonna echo what Amanda said. You know, another thing a couple of you know, sentences down, he said it's about, um, you know, fostering a cost aware culture and creating accountability, which again is something that those of us in it, we've not really had that. And I think that that actually is a, is a really great outcome as well.

I don't know as much about this topic, but I will say that this article was really well written and, and really opened my eyes as to the possibility of what finops is. Because again, I came at it, like you said, kind of thinking about it. Oh yeah, that's about, you know, keeping your AWS bill down.

That's not what it is at all. I'm gonna say bull dingy. Um, here's the thing, and this is the truth of the matter.

IT people, we had capacity planning back in the day. We had cost controls back in the day for everything on premise. And then the cloud came and we just basically abdicated responsibility for it.

We threw it open to a bunch of developers who then showed up at a bar, like a bunch of drunken sailors and started consuming stuff and over provisioning stuff. And everybody said, oh, well we can't get in that conversation because God forbid we slowed them down with any troubling information like costs. So I think finops is a lovely little term that we've come up with that kind of circle back and maybe apply some supervision to this stuff.

'cause we are freaking out about the cloud pills. But to sit here and say that finops is gonna be a a practice, I don't know. I'm not buying it.

I think it's part of your job, it's your responsibility and it's gonna be a core feature into your ITSM platform into your DevOps platform. And the days when we just let people consume things without any concern about cost or over, that's my Tuesday. So You're saying Lisa, help Lisa help me attack Mike here, finops as a practice.

Seriously, It's about it, It's been helpful. It's been helpful. It has been helpful.

I, I was just writing about this for TechTarget and the other week it, what I, what I like about it as a practice is the cultural transformation that, that we're seeing going on within organizations who, with shadow IT are just spending money and suddenly it's out of control. Um, you know, getting the heads of departments together, marketing operations, sales services, you name it, and having them understand how they're using it, there's value in that. The outcomes Steven talked about, the outcomes Amanda talked about, that's value.

So maybe it's just a messaging kind of, um, kind of mixed up their costs, optimization versus value. Well, that is a value to an organization. Um, I, I see that definitely.

But I really see organizations embracing the cultural transformation, which is hard to do in order to deliver value to the end customer. And that's what it's all about at the end of the day. Yeah.

Let's, let's you wanna talk about the realities, Mike? The realities today are the same as the realities of 20, 30 years ago, which is that the dev people hate working with the infrastructure people and the infrastructure people wish the dev people would leave them alone so that they could just run a great infrastructure. And what something like a finops does as a practice is it allows the infrastructure people to say to the dev people, just go do what you want.

You don't ever have to talk to us because we are putting the policies in place that we are all mutually. That was another great thing in that article, by the way, was talking about setting a common framework for understanding how resources should be used. So we have a common policy, everybody's bought in, you don't have to talk to us anymore.

You can just go and do your stuff and have fun. And you know, the finops magic of tooling and all that other stuff will, will ensure the policies are put in place and you can do what you need to do. I'm not blaming the developers, they just walked into the situation and took advantage of it as they found it.

So it's not really their fault. I am saying it's the absence of leadership on the ING your IT executives that says, oh, now we need a little pin ops flag that we can wave so we can regain control of this thing. And that's kind of silly.

Steven, I argue one point either way, Well, I'll just say this. Uh, it sounds like what we're saying is that we need to foster a cost aware culture and create accountability, which is literally what our author Tatum Tonin said in this art. I think We should, that's a key point.

I just think we should take a little responsibility for the situation and not blame it on some magical thing that we weren't aware of and, and then wrap a buzzword around it. I think what I'm saying to folks is like, look, we're having this conversation and we need to have this conversation largely because you allowed this to happen. That's all there is to it.

It all right, I'm gonna end it there. I guess I'm gonna get the last word on that one. You sure guys?

Yeah. We're not you, we're not. We, we can't have my optimism finish the segment.

That just doesn't work. Let's, let's stick with your dark feel of the world. I, I, I am optimistic that this issue will get fixed.

I'm just saying, guys, I don't think we're gonna be using this term for much longer. All right guys, everybody, thanks for sharing your insights today. As always, spirited conversation, we always like to have those here in the tech strong gang.

We invite you all to stay tuned for all the rest of the content that's on Techstrong tv. It's an awesome lineup. Once again, thank you all for participating and we'll see you next time.

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