November 11, 2016

Episode 78: Trump's possible effect on tech, plus, containers

1 hour 21 minutes

We discuss possible effects that the Trump presidency will have on the tech world. The ideas are more or less known, but the details and whether they'd be enacted are sketchy and unreliable. Before that, of course, we talk about containers.

This episode features Brandon Whichard, Matt Ray, and Coté.

Mid-roll

Matt: Dec 1st and 2nd - DevOps Days Australia 20% discount code - SDT2016.

Coté: Nov 16th - Cloud Native Roadshow in Omaha, next week.

Coté: Various dates - Pivotal Cloud Native Roadshows - Cincinnati - Nov 10; St. Louis - Nov 14; Hartford - Nov 16; Denver - Nov 18; New York - Nov 22; Los Angeles - Nov 28.

K8s Operators

Stateful applications for K8s, a shot at Mesos?

Prometheus & etcd first examples (spark? hadoop?)

This begs the broad question: so, what’s CoreOS’s business posture now?

Azure Container Service, now with K8s

Those Microsoft folks will just put anything that looks tasty in their cloud - what a reversal from the Microsoft we grew up with.

Docker in Production: A History of Failure

From this dude’s perspective: a failure of product management and stable releases.

Bugs, documentation spotty, cleanup scripts, kernel support (Debian!?), aufs & overlay & overlay2, 7-hour outage with no post-mortem

“Docker only moves forward and breaks things”

“The docker hype is not only a technological liability any more, it has evolved into a sociological problem as well.”

A retort… that mostly agrees

“boring tech is what makes money” shiny tech makes resumes?

Mesosphere

Jay Lyman on the momemtum: “Mesosphere does not disclose its number of paying clients, but says it has dozens of large enterprise customers, its primary target. The company says its experience supporting software deployments in production is among its key differentiators, helped by the use of Apache Mesos by companies such as Twitter, Netflix, Airbnb, PayPal and Yelp, which was featured in a 451 User Deployment Report. Mesosphere says its focus is customer deployments of 500-1,000 nodes per day in production. It also says the bulk of its customers are licensees with professional services accounting for less than 10% of its clients, which tend to move to its subscription software.”

TrumpTech, aka, “Putting the 400 lbs hackers on diets.”

Turns out there is some marginally clear policy, just not McKinsey title mode versus white papers.

Jonathan Shieber@Tech Crunch: "The biggest question facing millions of Americans this Wednesday is: just how much of what Donald Trump said on the campaign does he intend to actually try to make happen." (For example, Korea.)

Dave Lee, at the BBC has a good laundry list: “Uncertainty, frustration and an increased fragility for the global home of tech innovation. Mr Trump certainly won't want to go down as the president who destroyed Silicon Valley, but the concern here is that of the few policies that have been explained in detail, some seem directly at odds with each other.”

10% repatriation program - tech companies have tons of cash abroad:

Historic rates: “At the highest tax rate, corporations must pay 35% to repatriate capital, minus local taxes charged by countries in which the funds are held.”

Hardware: “AAPL (93% of $230bln), CSCO (91% of $64.6B), IBM ($8.2B total cash, undisclosed % of cash held overseas but note 58% of earnings are from non US operations), HPE ($10.0B total cash, undisclosed % of cash held overseas but 65% of earnings are from non US operations), HPQ ($5.6B total cash, undisclosed % of cash held overseas but 65%-70% of earnings are from non US operations), JNPR (94% of $3.2B).”

Software: “Specifically, some of the mid and large cap companies that have large cash balances “trapped” offshore are likely to benefit from being able to return a portion of this cash to shareholders. We note companies with high gross cash balances trapped offshore include: ADBE (85% of $4B – from 2015 10-K), ADSK (86% of $2.1B), CA (76% of $2.7B), CTXS (80% of $2.45B), FTNT (38% of $1.2B), ORCL (76% of $56B – pre-N), MSFT (96% of $113B – pre-LNKD purchase), RHT (42% of $2.0B), SYMC (93% of $5.6B – post-BC), VMW (77% of $7.5B), VRSN (68% of $1.9B). We believe the chances increase of a larger share repurchase or (lesser chance) dividend from these companies.”

Apple & Amazon are not in a good situation - they’ll be a good test of WTF happens. Meanwhile, tech stocks dropping a bit.

Ovum has a shit ton of quick analysis, all free:

Fear of US public cloud companies, globally. Remember the freak-out from NSA stuff? Same idea. I think the Gemans got over it.

Outsources:

“A massive curtailing of H-1B visas, for example, will mean providers will need to make immediate shifts in what they’re able to offer customers locally, unless or until they’re able to compensate with talent.”

“For providers, there’s also the unanswered question of the impact on US government spending.”

[Education](https://www.ovum.com/trumping-expectations-now-us-public-sector-2/ - some proposals for de-centralizing, meaning fragmentation of IT spend.

Government talent, regulations, and spending - “If there is a large exodus of high-caliber and skilled staff, how will departments fill the gap? It also raises the question of funding for programs aimed at modernizing tech in the federal government such as F18 and FedRAMP. Trump might reduce the barriers to swapping out tech and push down expenditure that way. Certainly, the high cost and length of time needed to get Authority to Operate (ATO) under FedRAMP has been a barrier to uptake.”

Telcos - other than him stating he’d stop the AT&T/TimeWarner merger, telco stuff is very unclear. No one’s sure what the traditional Republican +/- Trump equals, or what the formula is.

M&A from Brenon@451: “Chinese buyers probably won't be shopping as freely in the US in the coming years.” They spent $14bn this year, I think.

Chinese buyers have recently picked up Ingram Micro, which swings nearly $50bn worth of tech gear and services each year, 25-year-old printer maker Lexmark and even a majority stake in the gay dating app Grindr." Also see shorter blog post with chart of Chinese M&A spend.

Snowden for Head of NSA!.

Follow-up

That’s how you do it!

We got actual comments!

BONUS LINKS! Not covered in episode

Matt wrote up an Amazon ECS thing

The blog entry

Doing Business in Japan

Not new, but a good primer.

Recommendations

Brandon: New season of The Startup podcast

Matt: TransferWise for transferring money abroad. A16Z on TransferWise.

Coté:

“Tighten Up.”, Archie Bell & The Drells - once you’re done being depressed, get your shit back together.

HSAs.

Meanwhile, this “pastrami burger” at 3 Greens Market in Chicago is AMAZING.