Nile CEO Pankaj Patel on Building IT Infrastructure for AI Agent Demands

Hey guys. Thanks for throwing. We're here with Punkish Patel.

He's the CEO of Nile. And we're talking about infrastructure and how it's gonna evolve in the age of AI because, well, maybe it's just not enough to slap an AI agent on top of this stuff and call it done. Hey, ponage, welcome to show.

Well, thank you. What is going on here? Because everybody you talk to is saying, well, I'm gonna put an AI agent in front of my existing infrastructure, whether it's networking servers, or storage, or whatever it may be.

But the question then becomes, well, do we actually need infrastructure that is designed to natively run those AI agents from the ground up? Or is it enough just to try to train something on a legacy platform and hope for the best? What's going on here?

Well, I, I certainly believe that it needs to be, uh, done ground up, which is what we have done. And there are reasons why I believe in that, because, you know, this is, this is an industry I have been in for 33 years of my life, uh, of my very long career. And, uh, 22 of them were at, uh, Cisco, um, you know, being in charge of, uh, the largest engineering and marketing organization, uh, in the world.

And, um, you know, when you, when you built all the products and you delivered, and you see, uh, the complexities that it created over time, uh, and, uh, what the customers had been asking about, which was to truly simplify the universe and to give them something which is not only insanely simple, but also very secure. And in order to do that, uh, uh, automation, uh, plays a very key role, and AI plays a very key role. And, uh, and, uh, today when you hear about, uh, every organization or vendor trying to integrate AI into, uh, the solutions that they present, it's predominantly aimed from the operations point of view.

And, uh, the goal is to lower the cost and optimize the efficiency, you know, but they truly do not, uh, implement the AI in any effective way. And, uh, uh, regardless of how they might claim to use the ai, um, uh, on the legacy stack, because, you know, you do run into limitations on the legacy stack as to what you can do. And the closest analogy I can give you is, uh, uh, somebody, uh, working on a new, uh, ev to try to take our old Toyota and, uh, put the battery and slap a bunch of sensors on it, or jobs back in 2005 and six, uh, could have started with a Blackberry phone, which we all loved and admired back in those days.

Uh, if he could have just, uh, uh, slapped the user interface on top of it, would it work? I, I submit to you, we won't have the iPhone today, right? And it's the same thing.

I think we are seeing a repeat of exactly the same phenomena. Uh, you cannot, you cannot, uh, slap this on the patchwork of technologies which have been created over four decades, and, uh, try to think about it, that this is going to give you that, uh, a vehicle. I actually give you a couple more data points, which is, you know, I mean, when you look at the legacy of each one of these companies and, uh, and you age, when the software stacks and the entire vertical stacks were created, the products are created in, uh, patches in islands.

There is no cohesion between, uh, uh, the things coming together as a solution. And, uh, what what that would end up in, uh, offering is a patchwork of solution without any true, cohesive data model, consistent, giving you holistic design to really bring the AI principles to really apply in a very effective way, right? And, uh, the people who, and the vendors actually who talk about, uh, uh, the AI and, uh, the cloud native, uh, I would ask a simple question to say, if your software stack tends to be, uh, uh, 10 years or older, um, at that time, there was not a giant, uh, notion of, uh, cloud, cloud was coming of age.

And, um, uh, so number one, uh, you could not have used the CICD model, which all the, uh, all, all the public cloud providers used today, right? You couldn't have done it using that model number one and number two, back at the time, how many, let's face it, Nvidia was a video game company and a crypto company, right? So I mean, like, you know, nobody talked about AI back then.

So, you know, that shows that, uh, the things coming together from these companies are pretty much, uh, um, bolted as a siloed, uh, result of the siloed decisions. Whereas in our case, we truly look at this as from the point of view of the customer experience and what we had to do as a completely different and a consistently holistic design in the age where we have done this in the chat GPT universe, this is not the predictive model universe, which is where most of the vendors will be in. And, uh, this is using the true ative AI models to do what we had to do.

So, geek out for me with a for a minute, what exactly is different about a, a networking platform that's optimized for AI than what I might see in a traditional switch? All the products that you see, they're all from the traditional switches and the other networking elements. They all are designed in the embedded universe, not only embedded universe, they're designed in silos.

They're designed by either the org structure or the legacy that these vendors created over decades. Okay? So because, you know, look, I mean, I was head of the, I was the head cheff of the kitchen for so long, so I know exactly how the universe evolved there, right?

This is the universe that has evolved to, to give you basically over a dozen major architectures in enterprise, uh, with another 15 to 16 protocols, and each protocol having from couple of hundred to thousand knobs. When you multiply all of this along with all the different software revision levels that all this product support over the years, you essentially have a snowflake in every single deployment. Everything from the time you run it, from the time, all the way from day one, all the way through day two, day plus end.

Also from the point of view of when a problem occurs, how you end up in debugging and solving the problem, right? When you run into the security, uh, bug, and you have to create a piece of patch or any other patch to address the patches, it'll take customers weeks and months and quarters to do that, right? Because they all are developed using the embedded methodology and not in the cloud native universe that they all were designed, they were not thought about a, a simple holistic design.

We have, we have designed the entire Nile service block, by the way, which consists of, for the campus networking as the access point, very high end of access point, very high end of the access switch, very high end of the distribution switch, uh, sensors, a controller and a stack in the cloud. It's all designed very simply using the new cloud development principles and the most simplified and the most predictive design, Mike. So this is where the key differentiation comes in.

It's a very predictive design. So, for example, in my universe, when we come across, which we come across very rarely, but when we come across a software bug, my ability to, number one, to identify the bug root cause it, and by the way, to propagate that bug fix throughout the entire embedded base, I can do that in literally no time. This is the advantage that it gives us.

And by the way, that advantage propagates in the world of ai, it's no different, um, in terms of what we end up in doing. So it almost sounds like to me, um, the legacy platforms to your analogy, are based on more of embedded stacks, and there's a lot of, um, code that runs in those stacks on those devices. It almost sounds like you've taken a cloud native approach where I'm using technologies or, uh, that are consistently applied across all those switches.

So I've kind of got a little more separation between hardware and software, but then I'm also able to pull telemetry data off of that more consistently and then expose that to AI agents to automate workflows. Is that fair? Absolutely.

Absolutely. And by the way, in our, in our university, I think this is where, uh, one of the example I can give you, Mike, is that, uh, you will hear from the traditional vendors that they have developed tools where they can identify, they can identify, for example, uh, oh, a missing vlan, and they can, their tool will identify that, and the the tool can help them fix it. Our approach is don't have the VLAN in the first place, okay?

We don't, okay, because we eliminated layer two entirely, completely. Same thing when it comes to security. I, I would submit to you that over 98% of the network today are nothing but a complex collection of the legacy technologies duct taped together, which actually creates a giant surface area for exposure for security attacks.

And we have seen that many places, I don't have to name the casino, but you know, remember a very large casino many months ago, uh, when somebody was able to get through the first thing, you know, uh, this is where, uh, some of the VLANs, uh, when they're left unattended, uh, or where somebody provision something on that wheel and forgot about it, and later on somebody does that. Oh, somebody, somebody did something horrible to that, that happens, by the way, all the time, right? So this is where what we have done and what we have built, uh, from ground up, it gives you a very unique advantage.

So in our universe, going back to the example of the missing villain or whatever, right? We have automated it completely. So not only we provide this as a service mic, where, uh, on one hand it is like public cloud provider, like, you know, AWS Azure and GCP for from the point of view of the consumption model flexibility and the agility.

But on the other hand, it's also like Waymo, which is day two, after it is, uh, after it is wrecked and stacked and deployed. By the way, all that process in a universe is instantly simple. I mean, like, our gear is as easy as pulling out the iPhone from the slick white box from Apple, like very simple to no configuration, easy to install, easy to bring it up.

And once it is brought up, right, there is no human touch involved. You don't need MSP or IT to run it. And this is where it's like Waymo, I mean, you tell it that you want to be dropped off at 1628 Market Street, then bingo, it'll open the door for you, and here you get out, right?

That is, and, and you and I, we both know that when you do not have the humans tinkering with it, uh, the gear, uh, because, you know, the, the old estimates from Gartner and others have been that over 60 to 70% of the attacks originate from the network surface because it's very porous, right? So this is what we are able to prevent. So not only the value proposition of, uh, performance guarantee, incredible security, you know, uh, and, uh, saving people a ton of money and more.

I mean, we are, we are able to provide the true zero trust security, uh, through, and by the way, and the kind of AI automation that we have done, it provides a very new age compelling value proposition. It takes customers into truly the new, new age of ai, honestly. So now there are, I don't know, billions of network switches and access points that have already been deployed.

What's the math for replacing all of that stuff versus, you know, just kind of moving along and trying to add a layer of AI capability on top of it and hoping for the best? Yeah. Well, in our case, uh, Mike, uh, that's a great question.

Uh, in our case, uh, um, uh, we require, uh, the entire stack to be deployed. Uh, so, uh, by the way, having said that, I would say this, pardon me, that, uh, over 80% of our deployments tend to be Brownfield. And I'll explain to you where and how we succeed, uh, but we, we deploy the entire stack.

You cannot take, uh, a piece of hardware from us and slip on a piece of, uh, software from us and have that work, mainly because we borrowed the principle from Steve Jobs, which was to have the entire vertical stack because we needed to access every single knob that we possibly can, so we can automate to the nth degree, which is what we have done. So, uh, in a Brownfield environment, uh, the way we'll deploy it is that we will, uh, start with a floor and they will do the entire building, or we'll start with a building, do the entire campus. We have done, many of them are like that.

Greenfield is obviously much easier because, you know, there's nothing there. But Brownfield, we have done a lot, and people do it for various reasons. People do it because they, they, they are having, uh, challenges on performance guarantee.

People don't want to deal with the lifecycle management. People want, uh, zero trust security. We have done some giant deployment.

We have done some one very large deployment in New York City recently with over 1800 access points. And several hundred switches was mainly driven by two factors. One was absolutely zero, trust, security.

And by the way, they removed everything that they had before, and they deployed everything new from us, right? So security was front and center in their mind. And the second thing was, by the way, Mike, they give us one of the largest contract.

Uh, our typical contracts tend to be about five years. This one was a 10 year contract, and they gave it to us mainly because the CIO was able to tell his CFO that what if I give you a 10 year predictable network spend model? Wouldn't you love it so that I don't come to you every couple of years and I say, I need a new switch.

I don't need two new access points. Or, you know what, my maintenance contract is going to go up after two years? He said, no questions asked one price for 10 years, and the CFO said, I love it.

So these are some of the things that come into the play. As I listen, it starts to occur to me that maybe the architectures that we've had from yesterday year are designed in such a way that, well, we wind up increasing the total cost of it because we have to layer on all these different capabilities and things. So maybe the time has come to redesign this stuff to reduce that cost from the get go.

I, I agree with you completely, right? And, uh, I, I will, I'll point out to, we haven't said this yet, but we should, uh, there is a large storage company and their ad, uh, uh, for last six months has been, even if we, we have simplified our stack so much and we have created the operational efficiency that even if my competition gave away the software and hardware for free, you will still save money in three to five years. And that is the beauty of what we have done, right?

8 million. And this keeps on going up and up and up all the time. So, you know, one of my board members, uh, esteemed, uh, George Kurtz, the founder and CEO of, uh, CrowdStrike always coaches me and advises me that, hey, this is, uh, security is front and center on people's minds.

So that is what we have done, what we have created. It is something instantly simple and instantly secure. And in order to create that simple and secure, we have to create it automated and autonomous, that there was really part and parcel of what we had to do.

Right, folks? Well, you heard it here. Hey, if it's a new era of software, maybe it's time for a new era of infrastructure.

Makes sense. Hey buddy, thanks for being on the show. Well, thank you so much, Mike.

Thank you for your time today, and I appreciate, uh, you bringing me on the show. All right, I'm back to you guys in the studio.