Cloud computing on-premises: fantasy or reality? The vast majority of companies want hybrid information technology. But many are already spoiled on public-cloud agility and elasticity. They’re not keen to settle for rusty old on-prem technology.

That’s why so many providers (even Amazon Web Services Inc.) are rushing to market with “cloud on-prem” offerings. But what’s beneath the labeling? Can users really stay home without losing out on anything in public cloud?

Yaron Haviv (pictured), founder and chief technology officer at Iguazio Systems Ltd., isn’t so sure. Buyers of any product promising on-prem cloud had better thoroughly scan the ingredients list. The technologies that enable true cloud agility aren’t what makes up some of these private clouds. One ubiquitous poseur to keep an eye out for: VMware Inc. virtual machines, according to Haviv.

“Like, we’re bringing you VMs; we’re calling it cloud just for marketing’s sake,” he said. “Is that a real cloud-services platform?”

Haviv spoke with John Walls (@JohnWalls21), host of theCUBE, SiliconANGLE Media’s mobile livestreaming studio, and guest host Justin Warren (@jpwarren), chief analyst at PivotNine Pty Ltd, during AWS re:Invent in Las Vegas. They discussed the often intentionally blurred line between what can and can’t produce a cloud experience on-prem. (* Disclosure below.)

This week, theCUBE spotlights Yaron Haviv and Iguazio Systems in our Startup of the Week feature.

The revenge of the on-prem data center

Customers need to ask themselves why they are obsessing over cloud. Do they just like the way it sounds? Did they hear from a friend of a friend that it was easier than on-prem? Or do they have real business use cases that could benefit materially from agility and briefer time-to-market cycles? If they answered “yes” to the last question, then cloud and cloud services can help. But they need to get clear on which products currently marketed as cloud actually deliver that agility, according to Haviv.

“The reason they’re going to cloud is not just to use VMs; it’s to be able to take some Lambda functions, some pre-baked services, glue them together, and really come fast to market with an application,” he stated.

Stats on hybrid adoption vary, with some claiming it’s as high as 92 percent of enterprises. Sixty-seven percent of respondents to a survey from Microsoft Corp. Azure now deploy or plan to deploy hybrid cloud.

Not long ago, some insisted that all-in-cloud was ideal. They claimed that in the near future, companies would choose to put all applications in the cloud for performance, etc. Some no doubt still believe this. But actual enterprises straddling cloud and on-prem environments might beg to differ. They’re finding that an on-prem data center isn’t just a fossilized burden on the business; some workloads might truly be better off there for cost, data privacy, etc.

“A lot of customers think the cloud is a logical strategy for them, but over time they see that it increases cost,” Jeff Kroth, manager of data management and analytics at Softchoice Corp., told theCUBE in November. “It’s really about aligning the rightsizing of your environment, moving the right applications, the right data to the cloud, and using that as part of your overall strategy.”

Does this mean they must give up the performance that earned cloud its reputation as superior to on-prem?

Eyes on AI endgame

There are cloud services that can run in any environment — cloud, on-prem or at the edge. These are advanced services like serverless functions, artificial intelligence as a service, and managed databases. There’s a gap in hybrid IT, where companies have these at their disposal in cloud but lose them when they fan into an edge or on-prem environment, according to Haviv. Then it’s back to VMs, various slower IT processes and the like.

Iguazio is matching those cloud services in a form that can run in cloud, on-prem, or in a federated edge environment: “one consistent application development environment throughout wherever you are,” Haviv said.

The real end-goal of Iguazio’s cloud-services portfolio is real-time AI, an objective that’s caught the attention of  Google LLC and Trax Technology Solutions Pte. Ltd. in a new partnership for real-time supply chain and inventory management services in the retail sector. There are two main components that go into Iguazio’s portfolio. One is its Nuclio platform (available open-source and managed) for real-time serverless functions. The other is a high-performance real-time database that attaches to those functions. It helps stitch all the necessary data together for quick insights and decisions.

Time-to-action is everything in real-time AI for business decisions, on the fly, according to Haviv.

“The traditional notion is you have a data lake, you throw all the data in, then your data scientists go learn stuff, create nice dashboards in Tableau,” he said. “Great. So what?”

Businesses today want recommendation engines that cut out people and processes that slow decision-making. For example, a customer logs into a website, boom; he gets recommendations. Or real-time fraud detection in financial applications. Or cybersecurity analysis. There require very low-latency responses, Haviv pointed out.

What about Lambda?

Low latency is Nuclio’s ace card over other AI and serverless tech, according to Haviv. Even the popular AWS Lambda serverless platform can’t match it, he stated. “You’re talking about hundreds of milliseconds of latency. You’re talking about, like, a thousand invocations per second,” he said. Those numbers might suit a typical concurrency, single-threaded application.

“We’re talking about real-time applications,” he said. “Hundreds of thousands of events per second. We’re talking about latency in the range of milliseconds response time that you have to respond.”

To meet these demands, Iguazio had to build a different kind of serverless with real-time access to data. It’s suitable for multiple environments — on a laptop for debugging; a mini edge appliance enforcement point; on-prem for those stuck with old gear, legacy apps and the like.

Nuclio has become quite popular with GitHub startups, according to Haviv. Its managed versions complete with security, integration with active directory, integration with data, logging and monitoring.

Sorry, kids: Kubernetes is infrastructure

Amazon Web Services Inc. just made a big thud in the on-prem cloud market when it dropped Outposts. It purports to plop the joys of public cloud smack in customers’ data center. (Its RDS on VMware offering was a sort of harbinger to Outposts).

Haviv, for one, has questions as to how closely offerings like these mirror cloud. “If I’m going to this VMware on-prem with Amazon, am I going to get all the SageMaker, Lambda, all that on-prem? Or just more of a tactical thing like Azure Stack?” he asked.

(To be sure, analysts seem pretty bullish about Outposts.)

Haviv also has a warning for those overinvested in containers (a virtualized method for running distributed applications) and container-orchestration platform Kubernetes. If modernization is a move away from IT, then these technologies are a blast from the past.

“It’s infrastructure,” Haviv said. “We speak to customers. We show them what we do — serverless, AI workbenches, database as a service. That’s the interesting part. That eliminates IT.”

Kubernetes quite simply perpetuates IT, he added. “Now they need to take Kubernetes, tie it to their security system, build Spark on top of a container, etc.,” Haviv said. “Now there is a lot of IT and DevOps work involved.”

Watch the complete video interview below, and be sure to check out more of SiliconANGLE’s and theCUBE’s coverage of AWS re:Invent. (* Disclosure: Iguazio Systems Ltd. sponsored this segment of theCUBE. Neither Iguazio nor other sponsors have editorial control over content on theCUBE or SiliconANGLE.)

Photo: SiliconANGLE