This Week in Enterprise Tech 556 Transcript

Please be advised this transcript is AI-generated and may not be word for word. Time codes refer to the approximate times in the ad-supported version of the show.

Lou Maresca (00:00:00):
On this week in enterprise tech, we have Mr. Brian Chi back on the show today with me now in the age of a AI actually revolutionizing the industry. We deep dive in how it's making problems in the world of publishing. That's right. Our fake AI author books showing up on Amazon and good reads, we'll talk about that. Plus a business grapples with soaring SaaS offerings and costs. We'll bring in an expert from Zilo, Ben Pippinger, he's c s O of Zilo, and it can help sheds the light on how organizations could actually optimize their spending in the challenging times. Plus, ensure security and compliance along the way. You definitely should miss it. Quiet on the set.

TWIT Intro (00:00:36):
Podcasts you love from people you trust. This is T twit.

Lou Maresca (00:00:49):
This is twt this week in enterprise tech. Episode 5 56, recorded August 11th, 2023. Smart sas. This episode of this week in Enterprise Tech is brought to you by thanks to Canary, thousands of irritating false alarms. Help no one get the single alert that matters. 10% off a 60 day money back guarantee. Go to Canary, do tools slash twit enter the code twit and how to hear abouts box and by discourse, the online home for your community discourse makes it easy to have meaningful conversations and collaborate anytime anywhere. Visit discourse.org/twit. Get one month free on all self-serve plans. Welcome to ttw this week in enterprise tech, the show that is dedicated to you, the enterprise professional, the IT pro, and that geek who just wants to know how this world's connected. I'm your host, Louis Raki, your guide through the big world of the enterprise. Hey, guide you by myself. I need to bring in a professional and the expert in their field. I'm gonna bring back our amazing Mr. Brian g Brian, it's great to see you, my friend. How are, how are you feeling?

Brian Chee (00:01:56):
I am still low energy. Sadly, COVID really kicked my behind. I still have a cough. I'm still going slowly, but I am definitely feeling better, so I'm happy about that.

Lou Maresca (00:02:12):
Well that's great 'cause I think today we have a, a pretty busy show and with Kurt Gallivanting around Sun City, we've got a lot to talk about here. So I definitely think we should get started if we can. So, in the age where AI is revolutionizing the entire industry, we deep dive into how things are making waves in the publishing industry. Plus there's fake AI authored books, flooding your favorite online marketplaces. Have you seen them? Well, Amazon and Goodreads are definitely having them, so we'll definitely get into what that's going, what's going on there. Plus businesses grapple with soaring s SaaS costs or bringing in an expert from Xlo and Pippinger, these chief Strategy officer of xlo. And they can help shed some light on how organizations can optimize their software spending in these challenging times. Plus ensure security and compliance along the way.

(00:02:53):
So lots to talk about. So definitely stick around till later. And of course, always remember, subscribe to the TWI podcast at twit tv slash twit. And of course we also have Club twit tweet tv slash club twit. It's only $7 a month, you get access to all of our podcasts ad free. Definitely check that out. TWIT TV slash club twit. Thank you for ship support. Let's go ahead and jump in this week's news blips and today's cyber news from Ars Technica, a group of amateur hackers, mostly teens known as lapses, have caused a significant stir in the cyber world. Despite their limited technical technical expertise, they've successfully breached major targets, including Microsoft, Nvidia, and Okta. They're simply yet a creative strategies like bypassing M F A by calling employees repeatedly in the middle of the night have raised eyebrows in the security industry. Rather than high tech approaches, lapses focuses on persistence and social engineering. The Homeland Security Department's Cyber Safety Review Board in a new report, detailed lapses as tactics and urged organizations to create defenses. Notable among them other exploits, including hacking M F A provider Twilio demanding Nvidia making their G P A drivers open source and infiltrating Brazil's Ministry of Health, deleting over 50 terabytes of data. The report's takeaway the need for passwordless authentication systems and tighter regulations to combat techniques like sim swapping in the bigger picture. The overreaching theme is clear. Security by design is crucial for today's cyber environment.

Brian Chee (00:04:26):
So I've got another arss technical article, and this one's the dark side of ai. The headline on this is Innocent Pregnant Woman jailed amid faulty facial recognition trend use of facial recognition software led Detroit police to falsely arrest 32 year old Pocho Woodruff for robbery and carjacking reported by the New York Times eight months pregnant. She's detained for 11 hours, questioned and had her iPhone seized for evidence before being released. It's the latest in a string of false arrest due to the use of fa facial recognition technology, which many critics say is not reliable. The mistake seems particularly notable because the surveillance footage used to falsely identify Woodruff did not show a pregnant woman. And Woodruff was very visibly pregnant at the time of her arrest. The incident began with an automated facial recognition search by the Detroit Police Department. A man who was robbed, reported the crime and police used DataWorks Plus to run a surveillance video footage against the database of criminal mugshots.

(00:05:38):
We address 2 20 15 mugshot from a previous unrelated arrest was identified as a match. After that, the victim wrongly confirmed the identification from photo lineup leading to her arrest. So it goes on. It's not exactly a glowing recommendation for ai. Well, anyway, according to the New York Times, this incident is the sixth recent reported case where an individual was falsely accused as a result of facial recognition technology used by the police and the third to take place in Detroit. All six individuals falsely accused, have been black. The Detroit Police Department runs an average of 125 facial recognition searches per year, almost exclusively on black men. According to the data reviewed by the New York Times, the city of Detroit currently faces three lawsuits related to wrongful arrests based on the use of facial recognition technology. Advocacy groups, including the American Civil Liberties Union of Michigan are calling for more evidence collection in cases involving automated face searches, as well as an end to practices that have led to false arrests.

(00:06:52):
There is a great quote in here. Facial recognition alone cannot serve as probable cause for arrest. As a computer's identification is prone to errors that humans might also make. According to the complaint, despite its potential law enforcement's reliance on facial recognition has led to wrongful arrests causing humiliation, embarrassment, and physical injury as evident in this particular incident. Hey, like any emerging technology, AI has its share of stumbling box, and I would like to see the world not rush into things. False positives have long been a problem when AI was also used to tech detect fevers at the beginning of the pandemic

Lou Maresca (00:07:38):
In other cybersecurity news from dark reading, the rust base injector freezers is now being weaponized and a sophisticated phishing campaign. And the attack deploys malware via malicious P D F that cleverly sidestep endpoint detection and response or e d R systems uncovered by Fortinets Forti guard labs. This campaign is particularly targeting Europe and North America specialty, chemical and industrial sectors. Eventually it launches the XOR malware, which communicates with its command and control server. And this can result in anything from a ransomware attack to persistent backdoor. Also involved as the SS K S Y K crypto, a known tool for spreading malware via discord. The attack starts with a booby trapped P D F file, exploiting the search MS protocol in Windows to unleash its payload. A deceptive L N K file distinguishes A P D F icon tricks users into thinking it's legitimate. Carlin from Forti Guard Labs highlights that the multilayered strategy makes strategic analysis challenging. On the defense front, phishing continues to be a major concern. Obviously. Now, a whopping 97% of companies experience an email phishing attack in the past year. That is a lot to guard against these smarter targeted threats. Experts suggest regular software updates, consistent employee training and advanced security tools. Interestingly, phishing simulation training seems most effective in critical infrastructure sectors.

Brian Chee (00:09:02):
So this story, I gotta go and give credit. Lance Cadena provided me the 360 drone view of Lana. This is the before shot. Beautiful. It's a great place for vacation. Javier Cantal provides the after footage. This is really sad. Lana has, shall we say, been devastated and we're hoping that maybe you folks can help. So this is an image of Front Street shared from social media. I'd like to people to also beware, avoid the GoFundMe scams that popped up already, and instead consider donating to places like the Red Cross. At the end of this story, there's going to be a QR code that you can snap and get access to a local Maui paper that is listing legitimate charities that are boots on the ground and helping things up. Please keep in mind that the fires have also destroyed cell towers and other telecommunications facility in the area and tying up circuits, just because you might know somewhere in the area isn't going to help.

(00:10:20):
Since Lana is a fairly small community, the major mobile carriers don't have mobile towers positioned there yet, and will have to ship them in from the state capital of Honolulu. Kudos to Southwest and United Airlines for going the extra mile Southwest, providing extremely inexpensive inter island fares for evacuees. And United is flying empty planes to Maui's Kalu Airport so that tourists stuck in the area can return home. So I'd like to encourage you, if you are so encouraged, I'm gonna display a QR code. You can snap that and that'll take you to a website for the Maui NAO newspaper with legitimate charities that are helping out. And I will also give a quick kudo to Oprah Winfrey, who is a Molly resident and is helping also in the recovery efforts. God bless Molly. God bless Lena.

Lou Maresca (00:11:17):
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(00:13:42):
Well folks at now Time for the Bites. Now, this week we heard about even more news about how AI is penetrating and actually watering down different sectors of the market. Now, this week's disturbing news is from publishing world. According to ours, technic article author Jane Friedman made a startling discovery on Amazon and good reads fraudulent books possibly filled with junk or even AI generated content listed under her name. <Laugh>. Despite sounding the alarm, both online giants drag their feet on removing these fo titles until Freeman's plight gained traction on social media and on her candid blog posts called Why Good Reads and Amazon are de Becoming Dumpster Fires Freeman Sheds Light on these counterfeit listings, and it's not just isolated incident. In fact, recent reports suggest AI and tech tools like Chat G B T are being used to churn out eBooks at an alarming rate.

(00:14:34):
Some even climbing the Kindle bestseller lists. Here's where it gets tricky. Jane Freeman, a respected name whose reports on the publishing sector is un understandably worried here, right? Imagine if the the hit to her reputation with these AI generated fakes floating around could cause even more problems. You know, she la actually, she talks about a little bit more. You think I'd have control over the books on Good Read's profile, but it's far from the truth. The removal process. Well, it's actually a complicated maze of back and forth. While Good Reads did eventually act, Amazon initially requested trademark registration numbers from Friedman before acting on her claim. But hold on, this isn't just about one author. In fact, Jane Ward found 29 titles incorrectly listing her as the author on Good Reads. Sarah Rose faced a similar conundrum with a her newest book, which surprised she actually didn't write.

(00:15:27):
B book is actually pouring in indicating that the author impersonation is becoming all too common on all of these platforms. So this brings up the bigger picture. As generative AI threatens to overwhelm us with unlimited content, quality platforms like Amazon and Goodreads seem to not be prepared. Historian Dean Zens, he's actually shares his own bizarre experience where he purchased a so-called paperback edition of a popular book only to find out actually filled with unrelated content on the economic policy. Now, Jane Freeman's rallying cry is clear. Amazon and Good Reads need to step up. You need to verify authorship, and they need to squash fraudulent listings right away. Now that's a wrap on that, but I definitely wanna get Brian in here because he's been talking about this for a while. Brian, obviously with the rise of AI here, these infiltration of platforms like Amazon and Good Reads, you know, the industry's not ready. What, what, what, what are they supposed to do here? Like, what kind of protocols should they be implementing?

Brian Chee (00:16:30):
Well, there, there certainly needs to be better documentation on how authors are supposed to set up their books. Ebooks are definitely the big problem here. So here's one of the other tricks, shall we say that people have been playing, they list the book that might say has 700 pages or a thousand pages, doesn't matter a significant work. But what they do is they put the end of book tag in the early chapters and for, and listed under things like Kindle Unlimited. So once you hit the end of book tag, it's, it indicates to the Kindle Unlimited system that you finish the book and thus you get the full amount of money for that read. 'cause You don't, you don't get paid anything unless people complete your titles. Now, the other thing that's a problem is something that Curtis and myself have been really worried about is textbooks.

(00:17:37):
Textbooks tend to be quite a bit more expensive. Our cloud computing books and cloud security books are upwards of just under seven $0 each. That was priced by C r C press, not by Curtin, myself. And because our books are, were translated into multiple languages, we can't re we don't know Chinese or Portuguese well enough to be able to tell whether there are illegal or un or false fake versions coming out on ebook platforms. So that's gonna be another big thing. So one of the things that I'm kind of thinking that would be interesting is we've talked about non fungible tokens in the past, specifically for art mm-hmm. <Affirmative>, but maybe this is time to also start thinking about NFTs for eBooks so that readers can more accurately know that they're buying work by that author, not by an AI or not by someone that's faking it.

(00:18:48):
Sadly, there are some nation states that are using fake titles or fake software to bring in hard currency into their coffers that are then funding who knows what. It is worrisome, I dearly hope Amazon specifically gets their act together in good reads. Interestingly enough, the folks at Barnes and Noble actually have something similar to NFTs. They, they actually have all their titles digitally signed in a much, much different way than the Kindle system does. So on the Amazon Nook platform, if I buy an ebook, I know I'm getting an ebook from that author because Barnes Noble is much more oriented towards the authors their system seems, I'm not 100% sure, but it seems to be more interested in making sure the work of art is legitimate, whereas Kindle seems to be more interested in forking over those dollars

Lou Maresca (00:20:01):
<Laugh>, right? Sure. And of

Brian Chee (00:20:02):
Course, I gotta say that's my opinion only <laugh>.

Lou Maresca (00:20:05):
Right? Right. I mean, I think I get the concept of verifying the identity of the author to ensure that the book submitted are actually by them, by, I think the, there's, there's actually an even bigger problem, which is just, you know, there's, there's no reason why people can actually go and clone some other book or concept or character and go write their own version of it using these, these generated technologies. Do you think that publishers are gonna be, are ready for that? I mean, it seems like there's a flood of the market of just that as well. And some of these books are even very popular.

Brian Chee (00:20:41):
You know, I don't know. I am just getting into doing a fiction book that I plan on doing through Amazon only because with traditional publishing, at best, I'm gonna get maybe 12% of the sale on Amazon. That's Amazon share my shares closer to 80 something percent. And I don't have to go through the extreme pain of dealing with traditional publishing. So there's a lot of incentive for authors to use things like Amazon and good read. However, it really worries me that Amazon especially and Good reads, have not taken that one extra half step to validate that the author's work is really the author's work. I mean, their system, when you go and create, create an author account for the Kindle Publishing system, it makes you jump through an amazing number of hoops, right? But the one thing it really doesn't do is make you prove who you really are. So I think that's gonna be a missing step that our friends at Goodreads and Amazon are gonna need to take, especially as AI starts getting more and more abuse.

Lou Maresca (00:22:09):
Right, right.

Brian Chee (00:22:11):
How

Lou Maresca (00:22:12):
I'm, I'm actually curious about this because this, could this be a methodology that a, that the platforms can do where they could just basically start to work with the actual authors themselves and say, okay, like, this is what we need you to do in order to make sure that things are safer, more authentic online. Like these are, obviously, there's probably lessons we can learn from other industries that we can utilize for this type of thing, right? There's has to be something some other way that the publishers like Amazon, even being a, you know, self-publishing platform can work with its users to try to say, okay, like, this is what we want you to do going forward when you, when you, when you you know, submit a book or submit a thing, whether, whether it is an identity thing or not. So educate them on better methodologies to do to, to basically ensure identity and, and things are safer. But is there, do you think there's other industries that we can learn from here that we can maybe find better ways and to, to actually combat this type of thing?

Brian Chee (00:23:08):
Well, I, I personally think we have a reasonably good solution that we're not using the copyright. Yep. When you go and create an I S B N number with the Library of Congress before Amazon or anyone lets you put up an ebook, and I, ss b n number is generated now, the I S B N number is assigned to an identity. Now, the I S B N numbers for our two textbooks that Kurt and I both wrote together we're assigned. One was to my name and one was to Curtis's name. But we were never given any kind of digital certificate or any kind of specific number uniquely identifying us. The only unique identity was actually with the publisher because they wanted to go and file our 10 90 nines. So we actually had to give fork over our social security numbers so they could assign a tax id. So, since no, almost no one writes a book just for the heck of it, maybe just, maybe we either use the unique author number assigned by the Library of Congress, or we use a tax ID number, which we're used to anyway. And Amazon actually has, whenever you're a seller, you have to assign a tax ID number, right. So maybe it's not so much missing steps as skipping steps.

Lou Maresca (00:24:47):
Right? It's true. Now I obviously Amazon basically propelling the self-publishing market forward and, you know, obviously they're, they're just not ready for this type of technology, obviously. Being able to generate things as, as, as well as it does, I think that's the biggest key here is, you know, some of these newer models are able to generate content at a much higher quality than past models. Especially if you iterate on it. Like obviously if the person actually were to read these generated books and actually self-edit themselves and say, oh, wow, like this is doesn't make sense, or they go and run it through again, the areas that don't make sense and to make them make sense it makes it even harder to, to actually discern whether these are, these are fake generated content or not. So I think like this is definitely gonna be a problem as literature becomes more and more like a gig economy almost, where, you know, people can go and self-publish themselves.

(00:25:43):
There needs to be more and more systems to guarantee more validity going forward. I, I do like the, the, the, the service that you're talking about here is obviously following things like copyright ensuring identity. However, that doesn't stop somebody from the very beginning of becoming a new author. And I think we need to, we definitely need to figure out that. I think that's the biggest thing that Amazon's gonna have to combat for sure. And I think that's gonna be a problem with a lot of things, including, you know, we're starting to see this even in the tech sector when it comes to people publishing new papers around things. Things are getting generated. And, and I think that's an even another big problem. So I think that lot, lots of different sectors of the market are gonna have this challenge to go. I mean, even in, in education, you, you probably know, you probably have people submit papers before that, you know, could have, could have been plagiarized. I mean, this is, this is probably gonna be an even bigger problem in the, in the education industry, isn't it?

Brian Chee (00:26:37):
Actually, I was involved in two investigations where the computers for the research lab were seized, and we actually went through a forensic audit, and f in one case, we found falsified Photoshop, oh my gosh. Images of electrophoresis gels, you know, attempting to prove falsely in this case that these compounds that they had created were anti-cancer drugs, and potentially millions or tens of millions of dollars were could be involved. Those profess, this is actually one of the few times when a full tenured professor not only can be fired, fired, but blackballed from academia. Wow. And we had quite a long conversation with both the local police department and also the F B I before it was decided by the Board of Regents to pull the trigger on that. Because once you do that, there's no backing away. Right. You know, that's the other side of the coin. You know, you, you pull that trigger and they can never teach again.

Lou Maresca (00:27:53):
Now, how did, you don't have to give out all the details, but how did, how did they actually, like, was it just really combing through the documents that they wrote to basically determine all of this and figure out, especially the, the Photoshop side of things? How did they, did they, they actually investigate the images to make sure they were real? How did they figure this all out?

Brian Chee (00:28:13):
Actually, how did I figure it out? Because how did you

Lou Maresca (00:28:15):
Figure it out?

Brian Chee (00:28:16):
Muck, going through terabytes of data. I actually used N Case, which is a piece of forensic software that's used by a large number of law enforcement agencies. And one of the first things you do is you do image searches because those are usually the easiest to find. So in one case we actually used it and I, I found, unfortunately, I found a lot of kitty porn and investigation instantly stopped there. It instantly got jumped up to the federal level. All my investigation tools and everything were turned over to the F B I and that particular professor is now serving hard time. Right. in the second case, it was finding images and electrophoresis gels are you, you document those using image high resolution images. I then turned all those over with the timestamps of the files to subject matter experts who then determined whether or not they were falsified.

(00:29:22):
Also buried in the files are edit marks. You know, you working for Microsoft, you know, all about edit marks for Word and Excel and so forth, right. Applications leave lots and lots of fingerprints as does Photoshop. So it wasn't that hard to find out that someone had altered an image using Photoshop. And not only that, it gave me the exact time and date of that edit. Wow. So once that was done, then we just tied it to the documents and make sure that they were the versions that were actually submitted. Which by the way, Microsoft Outlook, outlook leaves a very nice paper trail.

Lou Maresca (00:30:06):
A lot of them do, even printers do this, right? I mean, you can basically track

Brian Chee (00:30:10):
<Crosstalk> those little, yeah. So that was actually one of my big jobs when I was working for the federal government is, is aiding law enforcement agencies that did not have computer forensic specialists to go and seize that right down to I'm sorry, you don't do a graceful shutdown of a computer. You actually yank the power cord and then you go and physically remove the hard drives and you go and do a forensic copy and take a hash of that drive. We keep the original in evidence and we return. If it's allowed to be returned, we return a forensic copy to the person. So it's an extensive and not particularly nice process. Right,

Lou Maresca (00:31:00):
Right. And I think that's the, that's the major point here that I think we hopefully will get across to companies like Amazon is the fact that this is not an easy process to do especially the fact that you have to be a forensics expert to determine a lot of this. And so, I I I, I'm hoping that the industry can figure this out as things move rapidly fast in different parts. So, we'll, we'll, we'll see, we'll see how it evolves over time. Thanks, Brian. Well, next up, we definitely have our guest to drop some knowledge on the TWI at Riot, but before we do, we do have Think another great sponsor of this weekend, enterprise Tech. And that's of course, discourse the online home for your community for over a decade, discourse has made it their mission to make the internet a better place for online communities by harnessing the power of discussion.

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Ben Pippenger (00:33:19):
Thank you, Lou. So happy to be here. Excited to talk a little bit about SaaS management, what we're up to at Zilo.

Lou Maresca (00:33:23):
Absolutely. Well, before we get into all that we do, our audience is a massive spectrum of experience, whether they're just starting out in the industry entry level, all the way up to the CTOs, CEOs of the world. And they, some of them actually love to hear people's origin stories. Can you maybe take us through a journey through tech and what got you to Xlo?

Ben Pippenger (00:33:40):
Yeah, for sure. I so I'm one of the co-founders here at the company, Ashley. So we started our business back in 2016. And sort of what leading up to that I had a bunch of different roles. I, I found myself early in my career at a startup called ExactTarget. We were an email marketing company. And early, early days I was I was in the individual contributor role of implementing our customers. We had large enterprise customers. Actually Microsoft was one of our large customers. I had had moved out to the Seattle area, actually to implement our product at Microsoft back in like 2008. So it was, it was a bit of time ago, but spent a few years out in Seattle and made my way sort of building teams out there for the company.

(00:34:22):
And then I came back our headquarters is in Indianapolis, Indiana. Came back here, took on a product management role worked in product management for a few years. We actually got acquired by Salesforce. So at that point in time, I was, I was working as a, a product manager within the, the Salesforce product organization. And at that point in time, just realizing, man, this was back in 2015 ish SaaS was really, you know, had been a delivery model for about 10 years at that point. And writing was on the wall that everything is moving to SaaS and it's causing a lot of chaos for a lot of organizations. So as we started to realize that we, we, we put together a, a thesis on on how we can help companies of really all different types and sizes understand what's going on with software. And we, we started xlo back in 2016 and so was leading the product and engineering organization there for a few years, and then moved over to a strategy role a couple years ago, where today I'm, I'm focused on our strategic technology partnerships a lot of sort of third party analysis. I work with a lot of our analysts, Gartner and others that cover our space and pay attention to, to categories around us. So it's been a fun journey for sure.

Lou Maresca (00:35:28):
Now we've had, we've always talked a lot of, a lot of companies here on the, on twit and twit before especially around the fact that they have tons of SaaS applications out there. They're utilizing sometimes hundreds of different applications, and they're not necessarily utilizing it to the full potential. They might have a thousand seats and they're only utilizing 500 of them. So there's, there's obviously lots of in fact, we've talked to several e r p companies that are doing some kind of AI analytics on people spend to determine whether they're spending too much on infrastructure or spending too much on services. What, what is one of the challenges that especially maybe even a small to medium sized business face when it comes to this type of thing? Because obviously they don't know, necessarily know what they're utilizing even. What, what are, there's lots of duplication obviously. What, what, what can companies and organizations do today, even without great services like xlo and that kind of thing?

Ben Pippenger (00:36:19):
Yeah, I mean so our data, we show that the average organization has about 291 SaaS applications. And then that's the average right up in the enterprise. You get into the, we have customers that when we first start working with them, we find over a thousand, sometimes 2000 different SaaS applications that are, that people are buying and using across their organization. So the problem is definitely real. It's definitely there. You know, if I think about how small mid-size companies can start to think about it I mean, there's lots of different tactics you can take. You, you mentioned, you know, a lot of licensing going wasted. That's, that's definitely rampant all over the place. Again, our data, we show about 44% of SaaS licenses are wasted. So that means they're either never provisioned or not given to the end users. So, you know, if without, without a system or a tool to help you understand the problem and how big it is for you, I mean, I would say starting with your biggest vendors, where you spending the most money and then looking at those, you know you know, Salesforce is a great example of one that you can start with to really understand, you know, how many licenses do we actually have of those licenses, who's actually using them.

(00:37:22):
You can get even more advanced to start to figure out, like if they have a license, could I downgrade them to different license types? So there, there's a, there's a ton of cost savings opportunities just around just optimizing your large platforms outside of just, you know, the chaos that, that exists within SaaS today.

Lou Maresca (00:37:38):
Yeah, I mean, it, it basically just un uncovering the fact that it's, it's the tough challenge, especially for people Oh, yeah. Who, who manage, you know, licenses as it is. 'cause I, I've worked with lots of organizations where you might have, you know, a an infrastructure team that's managing, you know, a certain set of things. You have an an IT team is managing another set of things, and, you know, they're all managing different licenses for different groups. And, and so it, it becomes a very complicated scenario for organizations. You know, a lot of redundancy going on there. Do you think that one of the major things that we've just talked about AI in our last conversation, is this something that's kind of coming up from the ground where this type like AI can actually help with something like this?

Ben Pippenger (00:38:20):
Oh, for sure. So I'll throw another status. You, I've got, I've, I've got a bunch of stats. We do an annual report where we look at all this spend data and usage information. So you know, if you rewind the clock back, you know, 15 years ago, it, your listeners were responsible for buying a hundred percent of the software that was being bought in the enterprise. You know, they were, they had data centers, they had servers they were supporting. They would deploy software to those servers. They would enable their teams on how to use it. And that's how the enterprise worked. Today our numbers show that, that it is only, only responsible for about 18% of the applications within a company. The rest is either being bought by the business. So being bought by like the, you know, your C M O, your head of sales, whoever needs those tools or being bought by employees, you know, employees out swiping credit cards, expensing that software through their expense management platform oftentimes going around safeguards and things like that.

(00:39:10):
So where AI starts to come into play here there's a couple areas. One is helping organizations find it all. So it's a, it's almost a needle in the haystack type of approach. Our approach at xlo, we, we take an approach of following the money. So we, we hook into e r P systems, expense systems, and we have a machine learning model that's sitting on top of all of that data to uncover what's being bought, who's buying it, how much are they spending on it. And then we bring that all centrally into a system of record so that you then have an inventory of all of your SaaS applications that are being bought and used across your company. So it really unlocks something that's not possible today through, through ai.

Lou Maresca (00:39:47):
Yeah, I was, I was just gonna dig into that 'cause I was curious about how you just said, Hey, you know, users and people in the company can just go spend their credit card on a service and we, you know, most of the company won't even know they have it. And that's, it's interesting. So you actually plug in to the money side, so where people are actually doing the spend and, you know, so it's like, let's say I'm using SS a P for my, for my E R P and, and a lot of those, those transactions get funneled through there. And of course I have to, you know, get approvals and, and, and, and, and pay out the company credit card, that kind of thing. So you are essentially starting there and saying, okay, I, we understand that this is actually for a service, and so we go and inventory that, or this is for a product and we go inventory that. And does it work for both services like SaaS applications, but also hardware that's, that goes along with it? So if I buy, I'd say a network appliance, but also comes with a service, does it kind of manage that as well?

Ben Pippenger (00:40:40):
Yeah, that's a great question. So our that machine learning model I mentioned, so it's processed through over a trillion dollars in spend data over the past, you know, seven or so years. And it's categorized about $33 billion in SaaS transactions. So it's, it's seen a lot. It is trained on SaaS, you know, that's really, we see, you know, to your point earlier, the problem is massive. It's big. People don't really understand how big the problem is for their organization and how to get their arms around us. So we've, we've, we've squarely focused on SaaS and helping organizations get their arms around that. Up to this point.

Lou Maresca (00:41:11):
Now, lemme ask you a question. Obviously, you're, you're, you're, you're working with very sensitive data. So some organizations I, you know, I talk to, they're always worried about these crawlers that crawl through their data and, and obviously report on things, especially financials. Is this something that, you know, you guys see and obviously you have to have special handling of this type of data when it comes to, especially in, in places like eu?

Ben Pippenger (00:41:35):
Yeah, yeah, for sure. I mean, it's you know, early days of the company when we set out to do what we're doing we knew that like certain controls and compliance were, is gonna be really, really required for us to be successful. So early on we went out, we got our SOC two agreement to make sure that we had all of our, you know, proper controls in place and covered. We've got, you know, security teams in place today that nearly every customer we work with, we go through an InfoSec review to really understand, you know, what data are we gonna get access to? How are we gonna treat our data, how long are you gonna store that data? All those important components of, of stand up a customer relationship. So yeah, so it, it is definitely a part of our, of our process to get that, you know, that all that all ironed out. But it's, it's typically something that we're able to work through especially because there's so much value here. There's so much when people see the data, when we come to them and we show that we found three times what they thought they had from a spend perspective around software, it's, it's it's pretty eyeopening and, and unlocks a lot of value for them as a, as an organization.

Lou Maresca (00:42:35):
I agree. Definitely eyeopening for sure. Yeah. And, and you know what, we'll definitely get into more of the eyeopening things in a moment, but we're gonna pause for just a quick break. We've been talking with Ben Pingry, C s O of XO about SaaS spending, and of course, how AI can play a good role in there. Brian, welcome back some questions.

Brian Chee (00:42:52):
Yeah, I'm, we started talking a little bit about how your data has different people that need to look at it. Let's go start diving into things like G D P R and HIPA and so forth. You, you alluded to the eu and EU means G D P R. What kinds of widgets, what kinds of controls do you have so that you can assure the people that are writing the checks that if they get hit by an audit, that they're not gonna go to jail

Lou Maresca (00:43:22):
<Laugh>?

Ben Pippenger (00:43:23):
Yeah, we wouldn't want that, obviously, Brian actually as you were talking earlier, I was like, man, I don't have anything that's gonna talk about how I put someone behind bars. So I don't know if my part's gonna be as impactful as, as the stories that you were sharing. But yeah, I mean, we, you know, we have full G D P R compliance, you know, all, all of our privacy policy, our EU privacy policy covers how we handle data and how we, you know, respect individual's rights to request their data back or deletion of that data. That's all covered in our own policies from a company perspective. We also have native tools inside of our application. So I mentioned, you know, on average a few hundred applications that we are discovering. We're also bringing forward for our customers visibility to know of those apps who has a SOC two in place, who has G D P R compliance, that they're stating that they're compliant with those things. So we're helping them get full visibility into everything and across their full SaaS inventory which can be really challenging just with all the apps out there and try to track it all and keep, and, and keep tabs on everything.

Brian Chee (00:44:20):
Well, let's go dive just a little deeper. Let's talk insurance. The, the reality is, is the insurance, operational insurance is covering an awful lot of day-to-day. It one of the things that I got hit with, 'cause I sit on the board for a couple of companies, is how organized you are, how well you can audit your facilities, has a direct relationship to how much you fork over to the insurance companies. Do you have those types of reports already set up, or is that a custom job?

Ben Pippenger (00:44:57):
Yeah, I mean, so, so sort of back to the discovery and the inventory side. So you think about it, right? So let's say we're working with the new company, we hook into their financial systems. So we're then running our discovery against that and creating this inventory of SaaS applications. This is something they've never had before. And on day one, there's a whole bunch of value that's unlocked. 'cause All of a sudden they can see every app, what they're spending on it, all the data we bring forward, like security information. But then also the important thing is that new apps are added all the time. So mm-hmm. <Affirmative> new apps are being purchased all the time. Employees are buying new stuff all the time. And we're surfacing all that in a, in a centralized system of record. So I, I, I honestly haven't really ever hit the use case. You're describing Brian around, you know, helping to control insurance costs and things like that. But just having that level of visibility and being able to reassure companies that are providing you third parties that are providing you insurance, that you know what's going on, and you have a system that you can rely on that's con that's continually updated. So that's removing risk from your organization. I can definitely see how that could be a use case for the data that we have in our system.

Brian Chee (00:46:00):
Yeah. I, I just ask, because I'm gonna show my age here this was actually a very standard thing that I B m put into their mainframes, especially on big C I C SS applications. So this is kind of in the category of, is SAS growing up? You know, has SaaS become the next mainframe? I don't see too much difference anymore. So your website has this really cool banner on it. It says, the platform CIOs love, the services CFOs need. What I'd like you to do is, let's expand on that a little bit. You know, right. How, why are you making that claim?

Ben Pippenger (00:46:43):
Yeah, I mean, so we'll start with the platform, right? So I mentioned inventory and sort of how we do that, that's really important for organizations to get that level of visibility. The two additional areas that we focus on within the platform number one would be around licensing and license optimization and managing your SaaS licenses. So you think about what Lou brought up earlier with the waste involved with, with SaaS apps, we plug in directly to those applications through their, through their APIs. We also pull data through things like your single sign-on provider, and you can actually upload data into the system as well to then get centralized visibility to know what your usage looks like. And then we drive workflows to reclaim and pull back unused or underused licenses. So that's, that's the second component. The third component then is around the renewal process and the renewal workflows that procurement and others required to then renew all these applications.

(00:47:32):
So you've got, you know, hundreds of apps inside of your portfolio of applications, all those renew on a regular basis. We make sure you are aware of those renewals that you don't miss a renewal, that you have the data you need to be have a proactive approach and talking with your vendors versus a reactive approach. So from a platform perspective, that's sort of the three buckets. Inventory, licensing, and then then renewals. We then couple that with main of service offering that we provide. And probably the, of, of the two different ones that we, that we offer, the one that stands out the most is our SaaS negotiator service. So with SaaS negotiator service, again, back to those renewals and the net new purchases of software, hundreds of them, how do teams really, you know, small mid-size and even the large enterprise scale to be able to support all of those negotiations. How do they understand price benchmarking? How do they know if they're getting a good price on an application? How do people on their team have expertise in all these different SaaS applications and other different levers you can pull during negotiations? So we provide a managed service that does that for for our customers. So it's really an extension of their procurement teams to be able to negotiate on their behalf and drive real cost savings back to the business.

Lou Maresca (00:48:39):
So, just a quick follow up to what Brian was asking. 'cause I think I'm very interested in the fact that obviously he, he called out the concept that CIOs and CFOs need this for strategic purposes. What about the combination like the, the collaboration between those two jobs, right? That's a very hard thing. Obviously the CIOs, they need systems and services to be put in place, but the CFOs wanna make sure that you're not spending too much money. So like how do, how do we, how do they bridge the, the divide between those two, those two kind of seats in a, in an organization basically?

Ben Pippenger (00:49:09):
Yeah, I mean, it's, that's another good question. And, and, and honestly, even more important given sort of the macroeconomic climate that we're in right now. You know, we've seen CFOs having just a, a bigger seat at the table with really almost all purchasing going through them for final approvals. So I think, you know, anytime a C I O and A C F O are working together, you know, the CIO's job is to really help the C F O understand why a purchase is needed. Is there, is there why, why you can't do it today with the tools you already have available to you, why something else is needed in order to accomplish whatever the goals you're trying to set out to accomplish. And then a C FFO is really gonna be thinking about, you know, is there r o I involved with this?

(00:49:46):
Is there cost savings? What, what can I expect as a result of us putting this tool in place? And they're probably just as important as how quickly, you know, when I think about how fast are the savings gonna be achieved, how, how quickly is that gonna affect our operating expenses, our opex and our bottom line? Those are all really important things. So I think the relationship needs to be one that they're approaching together to make sure the ccf, the C I O is bringing the C F O along along the journey as they're out thinking about buying and renewing different, different pieces of software.

Lou Maresca (00:50:16):
So, one interesting factor that I'm actually curious about, 'cause I talked to a lot of organizations that they use services that sometimes are based on the amount of compute or usage that you have on it. Mm-Hmm. <affirmative>. And

Ben Pippenger (00:50:26):
So does the, does Xlo have be able to perform that type of thing? 'cause Again, just analyzing financials, it says, oh, okay, you got this service, let's call it it, let's just call it stored service. And you're utilizing it to store data, but you're not utilizing it at a very high capacity, which means maybe you should be having a a be be purchasing another tier so you're not using it at a particular capacity. Is that something that Xlo can do because actually analyze that type of thing and say, oh, no, no, we can, we can probably bring you down to a, to a to a lower tier, that kind of thing? Yeah, it's, it's another good question. I think, you know, when I think about cloud in general, you know, I, I sort of bucket into three areas. You have your public cloud, you have your hyperscalers, that's your infrastructure as a service, your platform as a service.

(00:51:11):
And then you have your, your SaaS, right? So the, those are sort of the three different, three different areas. For the, for the sort of the cloud area, the infrastructure and platform as a service. A lot of times people are gonna look to like the finops function within an organization. They're gonna look to tools that are pretty well established out in the market today, like, like a Cloudability from Apptio or now I b m or, or one of the, like, we couple really nicely with those because you have those tools. We will bring forward some consumption data. We call it consumption data. When you're not licensing data, it's when you, you know, buy a bucket of things that you're then burning through, okay, we'll bring forward some consumption data for some SaaS applications. And then we'll, we'll also bring forward all that licensing information for your user license based apps. So, so really sort of thinking about those collectively together a lot of the same principles apply and, and ways that you can really drive savings and optimization opportunities through platforms like that.

Brian Chee (00:52:01):
Yeah. I want to jump in. How about the hybrid world? You know, I used to work at a university and academics aren't very good at moving things into cloud, and the best I could get them to do is hybrid, but a lot of the tools that I had access to wouldn't play nicely in the hybrid world. How about you guys?

Ben Pippenger (00:52:22):
Yeah, I mean, so, so if you look at third party analysis, right? We look at, I look at Gartner a lot. I mentioned, I, you know, we maintain relationships with them. You know, they're, they're focusing or they, they've come out and said, by 2024 SaaS spend globally will be about $232 billion in growing 20% year over year. And so it's, it's continuing to grow. They're, they've also said that software spend by 2026 will be $1 trillion globally. So there's just a lot of money going towards software. And the tipping point really has been reached from sort of on-premise to sas. And so we've, we've taken the strategic decision to focus on SaaS. We think there's a, a lot of problems there and a lot of opportunity there from a, from a cost savings and risk reduction perspective, that that's, that's squarely where we focus up to this point. But again, you know, into the future, I think people will always have hybrid. Like, that's gonna be a, that's not like everything's gonna always be in the cloud. There's gonna be hybrid approaches and things. So you know, I think it's, it's opportunity for us into the future.

Brian Chee (00:53:19):
Well, let's go and ask this, the loaded question then. If I'm looking at possibly adopting xlo, what kinds of homework should I be doing? How do I prep before I start calling your sales team?

Ben Pippenger (00:53:33):
That's a great question. I think first and foremost, like trying to figure out what you have. Like, you know, lots of times within organizations, there's somebody, maybe it's, maybe it's your software asset management team. If you're not quite big enough for a SAM team, maybe it's your procurement team. If you're not quite big enough for procurement team, maybe it's, you know, an IT director that's got a spreadsheet, they've got a list somewhere of, here's all the stuff that I know about, here's our renewal dates, here's the cost centers associated with it, here's, you know, who's the app owners for all of these things. So really starting there and start to figure out, okay, is this do we, do we have a grasp at least on, on what we think is happening? Have we had scenarios where we missed renewals or we were auto renewed, something that maybe we didn't need, or we feel like, man, we're spending way too much on software.

(00:54:20):
There's gotta be opportunity here. Those are all like, you know, you can go out and ask people in the business those questions to figure out, hey, maybe this is an opportunity for us and something that we should really, you know, double down into and try to figure out if there's, if there's something we can do. But I mean, I can tell you, like, you know, Brian, think about your your own personal life. You know, if you've got if you've got a spouse or you have children yourself, you're out buying software, you're out buying subscriptions for things. You know, you've got your Spotify subscription and your Hulu subscription and your YouTube TV subscription, all of these things. And if your, your family also has 'em, they all have them as well, right? You're probably spending way too much. You're probably buying the same thing multiple times. Lou mentioned duplication, even just in your own personal life. Now take that to a whole new level of an enterprise where you've got hundreds or thousands of people all doing the same thing. The problem exists, like it's there it's there really in almost every organization that we work with. But I think some of those, those early steps can help you at least get a frame of mind or a frame of reference for for how big the opportunity is for your organization.

Brian Chee (00:55:20):
Well, you know, speaking of opportunities, let's go do the blatant plug. Where can people go to get information about xlo? Where can they go to maybe scratch the surface and see if it's a good fit for their organization?

Ben Pippenger (00:55:34):
Yeah. So I saw you had our website up scrolling through. That's a, that's a great place to start for sure. There's a ton of information out there. There's an entire resources page that includes any white papers we've put out, includes all of our blog posts. We've got a great podcast. There's actually two different versions of it. One is all with our customers. So it's our customers on there describing what we call our, their o moments when they really discover what's going on with SaaS and how big the problem is for 'em. There's another one called SaaS Me. Anything that's I'm the host of that is, is really the fundamentals. What are the, what are the key questions that people are trying to solve for SaaS. So a lot of good information, a lot of good content out there.

(00:56:12):
We also have a a SaaS management index, which is a lot of those, those points that I was making earlier on our data. That's an annual report that we put out that's available on our website as well. So, lots of really good reference points for you to go and start learning a little bit about this category, about the problems we solve. And then when you're ready to talk to us, it's just as simple as clicking the, the contact button on our website to get in touch with one of our, our representatives. So I would love to talk to y'all. I think there's, there's probably lots of problems out there we can help you solve.

Lou Maresca (00:56:39):
Thank you. Thanks so much for being here, Ben. We really appreciate your time.

Ben Pippenger (00:56:42):
Yeah, for sure. Thank you guys. Really, it's been fun to be here. So it's great to meet you as well, Lou. My, my son's name is Louis, so it's always good to be know Lou.

Lou Maresca (00:56:50):
I, I agree. I agree. My son's Louis and my dad's Louis. So we have lots answers. Randy <laugh>. There you go. Great to, great to meet you. Take care.

Ben Pippenger (00:56:57):
Yeah, you too. Thank you.

Brian Chee (00:56:58):
Thanks a lot. Well,

Lou Maresca (00:57:00):
Well, folks, you've done it again, just had through another, out of the Besting Enterprise podcast in the universe, so definitely tune your podcast catchers. That's why I want to thank everyone who makes this show possible, especially to my co-host, Mr. Brian Chi Bert. It's always amazing having you on. I'm so glad you're feeling better. Anything you want to plug or pitch before we sign up?

Brian Chee (00:57:19):
I just wanna plug that Maui is definitely needing your help. And if you are so inclined to donate to help in the recovery process, please, please avoid those GoFundMe scams. Go to a real honest to God charity that has boots on the ground. We posted the link Maui now is the daily newspaper that I posted. They have all kinds of people that are written boots on the ground and one of the questions that folks in the chat room had was, are we gonna start seeing more of the telecom carriers helping out? And the answer is, I believe so. I have a fr one of my ex-students is actually one of the head networking people for the city and county of Honolulu. They've already transferred their starlink gear to the county of Maui to help with that.

(00:58:23):
They're actually doing a feed to the Hawaii Red Cross. And from what we are told, quite a few cows mobile cell cell systems are sitting on the pier in Honolulu getting ready to be shipped to Maui. So hopefully there'll be telecommunications in Maui very soon. So look forward to that. Please consider donating if you are at our prone to that. If you want to hear me rant and rave about, gee, I'm glad the giant Banyan tree in Lana might survive. Best place is actually Twitter. I'm still there. I'm a D V N E T L A B advanced net lab on Twitter. You're also welcome to email, I'm bert, spelled c h e e b e r t at twit tv or you can send email to TWT at twit tv, which hits all the TWT hosts. We'd love to hear from you. We'd love to hear your suggestions for shows. And everybody, please be safe.

Lou Maresca (00:59:28):
Thank you Bert. Well, with folks, we also have to thank you as well. You're the person who drops in each and every week to get your enterprise goodness. We want to make it easy for you to watch and listen and catch up on your enterprise. In IT News, we go to our show page right now, tweet tv slash twit, then you'll find all the amazing back episodes that we have. Of course, we're for 500 episodes. Now. Of course, next to those show notes, coast information, guest information and those videos there, you'll get those helpful subscribe and download links. So you'll find all of your version of your choice, whether it's audio version or video version, definitely subscribe to the podcast is best way to to, to actually, you know, support us of course and keep the podcast going of course. But of course another thing you can also do is subscribe to Club Twit as well.

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There you go. Tech, Dino Loquacious, we have Chicken Head, we have beat Master, a lot of great people in there each and every week. Eric Deckman. And they, they have a lot of fun in there. Of course, we got, we talk about a lot of fun stuff. We have set up some questions for the guests. We have some show titles, lots of fun stuff. So thank you guys for always being there. Definitely check the show live. I want you to reach out to me as well because I've been having some really good conversations about AI recently, of course, about Enterprise, of course, as well as about paths and SaaS offerings as well. It's definitely hit me up at twitter.com/liam. You can direct message me there, you can just post publicly whatever you wanna do. You could always message me on LinkedIn as well.

(01:02:57):
Linkedin Lewis Mores, I'm on there. I I have a lot of great conversations with people starting out, people in CSOs or CSO positions each and every week. In fact, it, it takes me an entire Sunday evening to get to it through all of 'em. And I, I really do enjoy it every week. So definitely hit me up there. Of course, I'm also on masks. Done Lou, I'm at twit Social direct messages me there. And of course, of course I'm Lou m p m on the Amazing Threads app as well. So definitely check me out there. You know, if you wanna know what I do do during my normal work week definitely check out developers.microsoft.com/office. There it is. So, really gives you a lot of great options to customize your office experience to make it more productive for you. Whether it's coding or just creating bots or maybe even just adding automation check.

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Definitely check that. And of course if you have Microsoft 365 right now, open Excel and there's a new automate tab in there, definitely check that out because that allows you to record different things within Excel and automate them. You can send them over to Power Automate, integrate with them with other services, you can run them on schedules, whatever you wanna do. Lot of great ways to really customize your workflows and your orchestrations. And I, I guarantee you'll find it more productive. Let's definitely check that out. I want to thank everyone who makes this show possible, especially so Leo and Lisa, they continue to support this weekend enterprise tech each and every week and we couldn't do the show without them. So thank you for all their support over the years. And of course, thank you to all the staff and engineers at twit because we couldn't do the show without them.

(01:04:19):
Of course. I wanna thank Mr. Brian Chi one more time 'cause he's not only our co-host here, but he's also our tireless producer. And even when he was sick, so he was done, does all the bookings and the plannings for the show. So we really couldn't do the show without, with him. So thank you Cheever for your support. Of course. Thank, we wanna, before we sign out, I wanna thank the editor for today because if they're gonna get rid of all my mistakes, so I appreciate that. Of course. Thank you to our T d d, miss TD today technical director, Mr. Ant, Pruitt Ant, it's always great to hear you, my friend. Now I want to hear about some of these special events that are coming up on Club Twit.

Ant Pruitt (01:04:51):
Well, Mr. Lou Yes, in Club Twit, we do have some special events coming up. We have a photo walk that'll be happening here in Petaluma here. I believe it's the 24th. 26Th. This is last Saturday in August. Looking forward to that. We just recently did a photo critique and then even down the road we're gonna have a a m a with this one. Dude I know named Blue Mariska. He, he seems to be all right. So yeah, join Club, club twit, y'all. It's seven bucks a month and I believe that's probably less expensive than one of those fancy coffees you drink.

Lou Maresca (01:05:29):
That's right, that's right. It's, it's, thank you an always really enjoy the, those, the extra events and of course your support as well. Thanks again. Well, until next time, I'm Luis Mariska just reminding you, if you wanna know what's going on in the enterprise, just keep TWIET