Citrix Makes Strides with Xen

| Feb 13, 2008 | Enterprise Network Systems | Competitive Intelligence Report

| Analyst: Steven Schuchart

Current Perspective: Positive
Vendor Importance: High
Market Impact: Moderate

Event Summary

February 11, 2008 - Citrix has announced Citrix XenServer 4.1 and Citrix XenServer Platinum Edition, the first new releases to its server virtualization product line since completing its acquisition of XenSource. The new release also adds more than 50 new enhancements including increased support for enterprise storage systems. In addition, XenServer adds specific new optimization for Citrix XenApp. Citrix also unveiled a new tool called Citrix Workflow Studio.

Analytical Summary

• Current Perspective: Positive on Citrix’s release of the XenServer Platinum Edition, XenServer 4.1 upgrades, Citrix Workflow Studio and the renaming of Presentation Server to XenApp Server, because Citrix is really taking its new virtualization products to heart and has made significant branding and software integration progress after only 90 days. Citrix has done an outstanding job of handling its acquisition of XenSource and this announcement proves there is real and tangible progress happening at Citrix.

• Vendor Importance: High to Citrix, because the integration of the Xen products into Citrix’s product lines and strategy is of the utmost importance both from an industry and a customer perspective. Citrix needed to show it not only had a plan but the ability to execute, and this announcement shows Citrix’s commitment to Xen integration, development and marketing on a going forward basis.

• Market Impact: Moderate on the server virtualization market, competitors will need to closely watch Citrix and its plans as it is clear that Citrix is not struggling with the Xen acquisition, but rather thriving from it. Citrix brings crucial legitimacy to the Xen products and is taking the steps necessary to ensure that Xen is fully integrated and is indeed the flagship for its products and strategy.

Recommended Competitor Actions

• VMWare need to continue to point out the vast experience it has in creating and managing virtual machines in a data center environment when battling Citrix. VMWare has a huge market and mind share in virtualization and it needs to use that to maximum effect against upstarts like Citrix.

• Companies like IBM need to determine whether they need a strong relationship with Citrix or not. Citrix may represent some competition, but a limited partnership with them may satisfy the needs of some current customers and bring new hardware customers into the fold.

• Competitors to Citrix in the server virtualization market need to take the time to train sales associates and channel partners on Citrix’s position in the marketplace and how to respond to it. This needs to take place now, Citrix has gained momentum and the training needs to take place before Citrix’s momentum translates into market share.

Recommended End User / Customer Actions

• Customers that are using XenApp (Presentation Manager) right now and are considering server virtualization should take a look at XenServer from Citrix and evaluate it for possible use.

• Customers that are looking evaluating all virtual machine options need to make sure to include Citrix in the mix of evaluations. Citrix has a solid background and reputation and its server virtualization products deserve a look.

• VMWare customers should use Citrix as a “second source” in order to drive down the price of VMWare when negotiating contracts.

CLIENTS ONLY

Current Perspective

Competitive Positives and Concerns

Recommended Vendor Actions

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