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XenSource brings ‘Agility’ for Citrix’ customers

NWME: What would you say is the most significant angle of this acquisition for enterprise IT executives?

Wasson: At the very highest level, there is something really simple that I haven't seen in my career watching IT. If you go to IT leaders, CIOs and vice presidents of infrastructure and the like, and ask them what their top priorities are today, and they will say making IT more responsive to business and more agile and relevant to the business. That is very different than what you saw three or four years ago. What XenSource injects into Citrix that benefits customers is agility. This is not about consolidation for cost savings; this is about agility.

It will make it so you can make all the components of your infrastructure dynamically interchangeable and you don't have to hard-code apps to servers to hardware to processors to user etc. Customers will have an ability to build an infrastructure one time that can take any kind of change. If your infrastructure is not really, really flexible and able to change on the fly every time a user changes of an app changes, you can't survive going forward. That is how I would articulate the deal.

NWME: Where do you see XenSource technology fitting in with Citrix? What are some of the first logical integration points?

Wasson: All the things on the server-virtualization side we see as very, very relevant to the back-end side of applications so that business will continue exactly as XenSource has been doing — just kind of on rocket fuel. In terms of new integration and synergy with existing Citrix products, we very much see this opportunity in the desktop virtualization market. We think it's a $30 million to $40 million user market in the next three to four years.

But the key thing that has to happen is that desktop virtualization has got to get easier and more economical, and you have to put a premium on user experience. If you take a desktop operating system and you put it on a virtual machine in a data center, you haven't solved any problem, because you haven't delivered it to a user, and there is no user experience. It just isn't going to work. We think by driving these two together, integrating and combining the Xen technology with the Citrix Desktop Server product, which includes our operating-systems streaming and our virtual desktop system, will actually provide a great user experience.

The third thing I would point out, that even on the core Windows application-delivery space with our Presentation Server product line, which in itself represents 10% of the complete Windows Server workload worldwide today according to numbers from Microsoft. The ability to put the Presentation Server infrastructure itself on a virtual platform with the Xen enterprise technology offers a great fit that our channel partners and customers are just going to eat up. That's a bit more tactical but it is a huge opportunity we see.

NWME: How does Xen technology change the competitive landscape for Citrix?

Wasson: When you think about what Citrix has done over the past four years or so, we quietly built close to a $1 billion company. And then in the past three years we kind of went on a tear from one product to a complete end-to-end infrastructure. As that has happened, every quarter and year Citrix has become more and more relevant and started showing up on more CIOs top-10 lists. I think the biggest thing it's done is not so much a competitive issue as Citrix has now increasingly going to be seen as one of the top five or 10 leading infrastructure players by every midsize to large enterprise company on the planet. So that is one thing, which means we are just playing in a different crowd.

The second thing that happens is that there will certainly be a relationship with Microsoft that will be enhance by this. That is a key part of the acquisition choice. What XenSource did with their hypervisor and the Microsoft Veridian hypervisor that's coming out next year is almost exactly the same approach that Citrix did 10 plus years ago with its Windows Terminal Services and Presentation Server business. I think that the Microsoft relationship gets better. And there may be more 'coopetition' with someone like a VMware. We are partners with them, they are going to exhibiting at our event in October and we're exhibiting at VMWorld, so we are still going to be partners because big infrastructure players play well together and are in multiple accounts. But there is certainly going to be more overlap with the core VMware business than there was in the past.

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