These are gloomy days for hardware legacy companies like Hewlett Packard Enterprise Co., which saw vanishing sales last quarter. But is there a happier, if untold, story unfolding in open-source compute projects?

“I think we’re going to see a hardware renaissance,” John Furrier (@furrier) (pictured, left) told Dave Vellante (@dvellante) (pictured, right), as the co-hosts of theCUBE, SiliconANGLE Media’s mobile live streaming studio, read the tea leaves at the HPE Discover event in Las Vegas, Nevada. (* Disclosure below.)

This does not mean that customers will suddenly march from cloud back to on-prem hardware infrastructure, but rather “the message of computing is changing,” Furrier stated. The new compute philosophy is quietly forming in open-source communities like the Open Compute Project, a collaborative group focused on redesigning hardware technology to support the demands on compute infrastructure.

“There’s a lot of disruption kind of happening. It’s almost like this small, not well-reported marketplace. Not a lot of money’s being made yet, because some new thing’s happening,” Furrier said.

That new thing is not so much about silicon itself, but the business model around it, according to Furrier, adding that HPE, if smart, could lead this shift by innovating in true private cloud (a $260 billion market).

HPE’s wisest move would be to supply a “hardware business model rather than hardware product, where they bring their systems expertise in, use open-source, bring the stuff out of HP Labs and not try to be hardcore about productizing it,” Furrier said.

CPR for the P&L

While waiting for that prediction to come true, how will HPE stay afloat on diminishing returns?

Between now and the HPE Discover conference in Madrid, Spain, this December, profits from HPE’s spin merger with Computer Sciences Corp will finally plunk on its earnings report, according to Vellante.

“I think it’s going to look a lot better — and that’s going to cause people to go, ‘Whoa, look at that. Now HPE’s got even more leverage to go out and do deals,'” he said, referring to recent HPE acquisitions of Aruba Netowrks Inc., Nimble Storage Inc. and SympliVity Corp.

Watch the complete video interview below, and be sure to check out more of SiliconANGLE’s and theCUBE’s independent editorial coverage of HPE Discover US 2017. (* Disclosure: TheCUBE is a paid media partner for HPE Discover US 2017. Neither Hewlett Packard Enterprise Co. nor other sponsors have editorial control on theCUBE or SiliconANGLE.)

Photo: SiliconANGLE