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00:00JOINING US TO DISCUSS FROM CAMBRIDGE, MASSACHUSETTS, AHEAD OF THREAT INTELLIGENCE FOR IBM. THANK YOU FOR JOINING US. TALK TO US ABOUT THE NEW MAINFRAME. YOU ARE WORKING WITH COMPANIES WHO WANT ENCRYPTION. HOW BIG A REVOLUTION IS THIS? >> THIS IS A REALLY BIG DEAL. THIS IS THE LARGEST INNOVATION ON THE Z PLATFORM IN A DECADE. WHAT THIS INVOLVES IS LOOKING AT ENCRYPTION AND HOW WE MAKE IT PERVASIVE. IN THIS PARTICULAR CASE, WE ARE TALKING ABOUT A SYSTEM THAT CAN PROCESS 12 BILLION TRANSACTIONS A DAY. PUT THIS IN PERSPECTIVE, LET'S TAKE SOMETHING LIKE CYBER MONDAY AS AN EXAMPLE. ON CYBER MONDAY, WE SEE MAYBE 30 MILLION TRANSACTIONS GLOBALLY. THIS SINGLE SYSTEM CAN PROCESS UP TO 12 BILLION TRANSACTIONS A DAY. PART OF THE TECHNOLOGY THAT COMES INTO PLAY IS THIS NEW CHIP. ON THIS CHIP, WE HAVE OVER 6.1 BILLION DEVICES. 14.4 MILES OF WIRE. THERE ARE 24 OF THESE IN A SINGLE NEW IBM Z. CAROLINE: HOW DIFFICULT WAS IT TO DO? HOW MUCH R&D AND TIME? 150 COMPANIES OVER TWO YEARS. >> WE WORK WITH A VARIETY OF COMPANIES INCLUDING HIGH MARK HEALTH CARE THAT SERVICES ABOUT 50 MILLION AMERICANS IN THE PITTSBURGH AREA ALONG WITH COMPANIES LIKE ADP. WHAT IS IMPORTANT TO OUR COMPANY BASE IS THEY HAVE A WAY TO ENCRYPT TRAFFIC AND DATA. IF YOU LOOK OVER THE LAST FIVE YEARS, OVER 9 BILLION RECORDS LOST OR STOLEN. ONLY 4% OF THOSE WERE ENCRYPTED. WHY IS THAT THE CASE? HISTORICALLY, IT HAS BEEN TOO EXPENSIVE. I DON'T MEAN EXPENSIVE JUST IN TERMS OF MONEY. EXPENSIVE IN TERMS OF TIME TO ENCRYPT ALL OF THAT DATA. ONE OF THE THINGS THE NEW SYSTEM DOES IS MAKE THE ENCRYPTION EVERYWHERE PERVASIVELY POSSIBLE. CAROLINE: HOW EXPENSIVE IS IT IF I WANT TO UPGRADE TO THE NEW MAINFRAME? >> FOR NEW CUSTOMERS, THIS NEW MAINFRAME COSTS ABOUT $500,000. WHEN WE CONSIDER THE AVERAGE COST OF A DATA BREACH IS ABOUT $3.6 MILLION, THIS IS A GOOD

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Why IBM's Latest Mainframes Are a Big Deal

Caleb Barlow, IBM's vice president of threat intelligence, discusses the new IBM Z mainframes, which let customers automatically encrypt all data and applications running on the mainframes without affecting their performance. He speaks with Bloomberg's Caroline Hyde on "Bloomberg Technology." (Source: Bloomberg)

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