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Citrix really needs to get its act together, and soon
Blood-sucking asset stripper may yet be fatal
Sysadmin Blog In the frenetic run-up to VMworld, it's easy to forget anything else exists in the tech world at all except VMware and its orbiting ecosystem. Cutting through the acquisition rumours and flurry of meaningless minor-version bumps by startups, big things are happening and need consideration. With that in mind, let's talk about Citrix.
Citrix's CEO has just retired, largely in response to pressure from asset-stripping corporate death knell Elliott Management. This means Elliott Management has their teeth in deep at Citrix, something that has come at the worst possible time.
VMware, apparently bored with cannibalising its own ecosystem for the moment, bought VDI enabler Immidio. This puts VMware on a collision course with Citrix, who are the current VDI kings.
Unfortunately, VDI and related technologies is pretty much the only revenue stream Citrix has. Combatting VMware's seemingly limitless resources would ordinarily take every last dollar – and then some – that Citrix has.
If Citrix is to survive it needs to find not only the money to meet and beat VMware, it needs to devote untold millions to divesting itself of a corporate lamprey that has it by the throat. Elliott Management doesn't care if it kills the host, so long as it siphons off enough money while doing so. The rest of the people at Citrix, however, clearly have a vested interest in the company continuing.
Citrix needs more features than it has. The VDI space is an arms race and VMware's most recent surge means that for the first time in a long time, Citrix has fallen behind. It no longer has the best tools for VDI in-house.
Fortunately, VMware screwed up in its acquisition of Immidio and it did so to Citrix's advantage. VMware should have bought Liquidware Labs (LWL).
LWL was (and remains) the customer-favourite User Experience Management (UEM) solution. So popular is it that one of my most vivid VMworld memories is being in a meeting with a top-level VMware exec and asking him when it planned to buy LWL. I'm paraphrasing a little, but the response was essentially: "I wish people would stop asking me that. Every session I do, someone asks me that."
But VMware didn't buy LWL. It bought Immidio instead. This caused LWL to pivot towards Citrix in a right hurry and now its portfolio of products and features can be brought to bear to support Citrix.
In a sane world, Citrix would simply buy up LWL. It's not particularly expensive and there are other competitors out there looking to make a dent in the VDI space. Snapping up LWL is a quick means to do this, and it would be the killing blow to Citrix.
Microsoft is increasingly looking to gain market share in this space directly, and other companies working on infrastructure endgame machines have also been making noises here. HP, in particular, looks like it is reorganising for a vertical appliance push and it could really use the exact same software companies that Citrix will need, just to survive.
Sadly, the chances of that acquisition happening with Elliott Management in the picture are slim. Citrix can still partner with LWL – and LWL is more than enthusiastic about doing so – but this leaves Citrix vulnerable.
LWL isn't the only partner company that Citrix needs to rely on to survive, but it's the most obvious. There are a number of acquisitions and/or partnerships that VMware and Citrix both need to close before this war is decided.
Rallying the troops
To survive, Citrix needs to expand its potentially addressable market. What better way than to start teaming up with VMware's bitter rivals? The recent Nutanix partnership is a good start, but only a start.
Citrix needs to step up and focus on marketing a more solid VDI stack to combat VMware, even if that stack consists of multiple vendors' products sold as a single SKU. Citrix needs to push back hard with both a channel and community play.
Very, very few organisations are going to use Citrix for anything beyond VDI. Which means that VMware has a de facto advantage in being able to pitch customers on the ability to manage their entire infrastructure using a single set of tools.
VMware's marketing machine is building to full steam around VDI and that means Citrix needs to counter VMware's message in the marketplace. More than anything, this means a need for a coherent response strategy today, not tomorrow. That strategy cannot be to answer VMware's joined-up solution a bunch of wishy-washy "well, you might engage our partners" crap.
If a Citrix rep goes in to pitch an account they need to pitch the whole stack, including LWL, Nutanix and what-have-you. They need to be able to meet – and beat – VMware feature-for-feature and do it at a lower price. If they can't, Citrix is dead.
Given the Elliot Management issues, Citrix's board and new CEO might not have the political capital to buy critical ecosystem companies like LWL. That doesn't prevent sales execs and channel managers from putting together a working strategy and firming up the partnerships that already exist.
The questions that remain are "do Citrix's execs know all of the above" and "will Elliott management back off long enough to let Citrix save themselves"?
This year, at least, a good deal of the intrigue in the virtualisation space is happening outside VMworld. Keep El Reg's virty newsdesk in your bookmarks because we'll be sure to let you know how it plays out. ®