The first part of this interview looked at Quantum CEO Hugues Meyrath’s career and how it came about that he joined Quantum as its CEO. This next part looks at his views on the products and their prospects, quantum’s debt and the difference he can make.
B&F: You’ve got the product lines, you’re in place, you’ve brought in new sales leadership, Tony Craythorne. There’s a CFO slot I guess you have to fill still. So Tony will help with go-to-market for the existing product sets. How do you look at things like video surveillance and Myriad? Do they have a role in the future you see for Quantum.
Hugues Meyrath: Yeah, so it’s a good question. So let’s talk about video surveillance first. I’ve learned a lot more. So I went with Tony to see in person something like 58 customers and partners the last three weeks. So we went on the road and I did a west coast trip. I did a Dallas and Oklahoma trip and I did an east coast trip. And then I went as you know to Europe for 10 days and I’m going to tell you about video surveillance. What’s interesting in video surveillance is underneath it, you have actually a converged architecture, converged like compute and storage architecture, which is a scale-out architecture based on open-source. I think it’s an interesting platform. So there’s something that maybe can be done with that, but it’s not priority number one. But number two, which is after I reboot the team, finished the rebooting of the team, and [then] we have more to talk about that that’s not been disclosed.
When the sales guy goes to video surveillance customers, they meet the video surveillance team. When I go meet with the video surveillance customer, they introduce me to corporate IT. Now we went to see a big casino; they have 10,000 security cameras. And I went to other customers like the Washington Metro Transit area, like the buses, the subways, they’re all Quantum surveillance in there. But when I go see the customer as a CEO, they introduce me to corporate IT, which are different buyers. And when we go to the casino corporate it, they tell us: “Hey, we’re a casino and we have issues with the insurance and privacy of leaving data in the cloud. What can you do for us?” And we have an ActiveScale cold storage conversation with them, right?
And that’s the motion that never worked at Quantum, right? This was the vision, like I can go into this segment and then go back to corporate IT. But I think what it takes is for the CEO, and maybe Tony; we need to train the salesforce, and I need to get my ass on the road to create that conversation on behalf of my salesforce. But assuming that a salesperson can actually do it on their own when they’re six levels down is not a reasonable assumption. Now, I’m not saying that I’m going to double down on video surveillance, but it’s actually a very stable product. Not a lot of engineering effort and really, really good customer names that you can potentially sell more to.
But you have to actually help the field sell more. And I think that a lot of the issues in the past is when you get a CRO that’s coming from a big large company and they’re waiting for the jet to show up. That’s not going to work. Like Quantum’s the salt mines. We’ve lost the right of an automatic meeting except with a lot of distorting customers. You have to be willing to go down the salt mines and put the effort in. But if you put the effort in, I think it yields with return. But you need the right people for those jobs.
B&F: Would you be possibly thinking that AI could possibly have a role here in helping to mine the video surveillance data?
Hugues Meyrath: Oh, absolutely. I think in general AI you have to look at it a couple different ways. I have a fundamental assumption for AI. If you look at what Gardner said, they said the 60 percent of the AI companies’ [AI projects] that fail is because they don’t have enough data in a data lake. The fundamental of a data lake for AI, [is] to make it affordable when you’re a startup; there’s different models where you have the startup model and then you have the mature company model.
In the startup model, they have to do everything in the cloud because they don’t have time to create infrastructure, they don’t have time to buy, or money to buy, a data centre and all that stuff. So they do everything in the cloud, which creates a huge hurdle for them. The failure rate is high, but for a mature company you can say, if I have this huge data lake in the cloud, and I have to recall that all that data, put it in a fast environment, you run into the egress fees and you can’t keep all that compute and a fast storage app in the cloud.
They can’t just keep growing that, and never retiring it to cold storage, because you can’t afford that. So my fundamental thing about Quantum is; our playbook should be the fastest primary storage and the cheapest store and everything in between to track all that data and move it from very fast to very cheap and start building IP around how we do that. How do we give visibility to the data? How do we index it, how do we track it? How do we put policies so that you can retire from expensive tier to a less expensive tier to a very cheap tier?
I just don’t think there are a lot of companies that have that. And it’s about leveraging the portfolio and changing the product strategy. And that’s the AI use case we can do and it resonates with the customer. I go to a customer, no one’s kicked me out, and in fact everybody’s there. We need ActiveScale cold storage and change our purchase behaviour so we can build our AI infrastructure.
I was at a big M&E customer, that has worldwide workflow, they’ve StorNext, they have ActiveScale cold storage. We talked about that. They want this AI environment which is in a private cloud so they can distribute assets and make them searchable, reusable across press, video, website, movies and all that stuff. That’s the AI strategy we play perfectly in, because we can be the core infrastructure under their AI. And once machines start generating data; I mean you’ve seen this, disk drives are having a second life, tape’s going to have to have a second life if you have an object interface in front of it.
Because the reality is people are going to run out of money. We’re just barely starting scratching the surface. So tape’s not just hyperscaler. It’s going to be you have to think about tape as, like in one rack, I have 20 petabytes , and you never have to open the darn thing.
… It’s huge and just one rack. So when you think about it, tape’s not about moving the cartridges anymore (off to Iron Mountain’s vault). It’s about how you can create a couple racks of tape and, there you go, 40 petabytes, 60, 80, it goes quickly, and it’s a pool of storage.
Now we’re putting disk and flash in front of it, in ActiveScale cold storage. So you have all the metadata in front of it, outside. So now it’s becoming this huge object store. If you can put policies around: “Hey, we’re doing this on the AI.” So precondition everything to disk or flash, put policies in front of it, [then] this becomes a huge powerful private cloud that has both flash and disk and tape, and then you can put super fast storage in front of it.
So I think for us, there are just so many things to do that we could do, just with the amount of technology we have.
B&F: And StorNext will be the natural piece of software to manage all this, provide policies and have your developments done on it later. How about Myriad? Is that still going to be a key part of Quantum going forward?
Hugues Meyrath: I think we’ve learned a lot from Myriad. I do have a plan. It’s not a public plan yet.
B&F: It has a future.
Hugues Meyrath: I’m not saying it has a future as is. … Myriad’s going to have to change one way or another. I think Myriad’s deployment model is very particular and it’s not lending itself to a quick insertion into a storage environment. You really need to have a different networking kind of environment. So I think there’s stuff we’ve learned from Myriad I’d like to apply, but I think in the end my vision for Quantum is to have one primary storage platform, not five that are finished.
B&F: You’ve managed to clean up the debt situation a lot as well.
Hugues Meyrath: Part of me coming on board is John (Fichthorn) and I bought the debt from Blue Torch Capital. … It was toxic and, frankly, there was a massive boat anchor for Jamie and the prior team. But we did that. We raised money on the public market, … [and] will convert the Dialectic debt into equity dilution. But, frankly, it is great because it’s kind of like the debt we have at Quantum is like bad credit card debt and how’d you get out of that credit card debt without restructuring it? You have to at some point. And I think we’re taking care of that and we’ve made difficult decisions in terms of reducing headcount mainly in non-product areas. And the point of reducing headcount was to match expenses to the revenue so we can actually generate cash and be EBITDA-positive. And that’s been the focus of me trying to figure out, okay, how do we get to be EBITDA -positive and generate cash for the business so it can be self-sustaining.
B&F:So you come on board and you clearly think Quantum has a good solid and profitable future ahead of it or you wouldn’t be talking to me at the moment.
Hugues Meyrath: I don’t need to work, Chris, I live at the beach and I have enough money. I’m not trying to be arrogant. I’m doing this because I have a connection. I have a 30 year connection. I came from Belgium with a black Samsung suitcase in 1994 on the six month, thousand dollars a month salary. And [one of my] first jobs was to work on Quantum heads for disk drives and tape drives, and get my little H1B and slog through it. And then I made my way through and I’m staring back at Quantum and I really genuinely do want to help. I mean, how do you not want to help a company that was your first customer and then where you worked? … I just really want to help and I think I can, I really do.
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And we too hope that he succeeds at rebuilding amd re-energizing Quantum.
