Citrix needs to re-evaluate its position in the large
company market if it is not to be eaten by the big fish Microsoft,
says Simon Moores
Last week, I was offered the proposition that Citrix,
like Novell, would ultimately fall by the wayside, another victim
of Microsoft’s well-worn strategy of innovation through
inclusion.
Novell is, of course, still very much with us and its foray into
open-source computing may see it rise, once again, like a Phoenix
from the ashes of its once powerful Netware empire.
Novell, in the late 1980s and early 1990s, suffered from
appalling hubris, failing to take Microsoft intentions in the
networking space seriously and then dithering over its product
strategy while its enterprise customers were lured towards the
promise of a better life with Windows NT.
Citrix is a little different because it has always been like a
Remora fish attached to the surface of a rather large and hungry
great white shark called Microsoft. Its MetaFrame software uses the
application architecture of the giant, which underpins every Citrix
installation and Citrix has done rather well as a consequence.
It was Citrix that arguably defined the early shape of
thin-client computing at a time when the concept was being torn
between competing interests and agendas involving Microsoft, Sun
Microsystems, Oracle and Microsoft.
Today, its MetaFrame software is the most popular method of
offering users access to Microsoft’s “line-of-business”
applications via server-based computing and terminal server
technologies.
Meanwhile, the IT industry is in the process of yet another
sea-change with the arrival of new XML-based solutions in hand with
Microsoft’s own .net application strategy, which is beginning to
show promise. As a result, some observers are beginning to question
how the future will treat Citrix and its MetaFrame product line
wired, as it is, into the backbone of a largely Microsoft
environment.
As the software industry moves back towards it roots in using
the internet as distributed network environment, the demand for
products like Citrix or terminal server must inevitably decline
over time. But until then, the demand to access legacy applications
with thin-client technology is likely to remain strong.
Forrester Research expects the server-based computing market to
continue to grow for the next two or three years as enterprises
expand existing deployments.
According to the research firm, “Citrix had a 78% market share
in 2003, but this will decline to 71% by the end of 2005 as small
and medium-business customers increasingly deploy Microsoft
Terminal Server without MetaFrame or other third-party
products.”
Forrester may be over-optimistic in its market share assessment
if Citrix customers move more rapidly than expected to a complete
Windows Server 2003 solution to save money.
Can Citrix innovate fast enough to stay ahead of Microsoft,
which is steadily building Citrix-like functionality in Windows and
how will MetaFrame fit into a .net world, where Microsoft’s own
.net applications may offer many of the features that make Citrix
attractive?
Where Citrix remains strong is in offering cross-platform and
multiple-device connectivity in a world where the Windows
environment is no longer the only game in town. Unix-based
solutions and systems may increasingly find their way into a
corporate portfolio once completely dominated by Microsoft.
Whether this nascent market can evolve quickly enough and in
sufficient volume to balance potential competition with Microsoft
in the Windows space remains to be seen.
Citrix hasn’t quite slipped into Novell’s shoes yet but its
future may have to balance short-term optimism against a
pessimistic worry that the Microsoft will continue to evolve
Terminal Server’s features at its expense, threatening Citrix’s
flagship ICA protocol, forcing the company to innovate ahead of
Microsoft in the .net space.
I’ve speculated in the past that Citrix is starting to feel the
squeeze with the arrival of Windows Server 2003, with load
balancing features from Microsoft that are capable of supporting
many thousand of users.
For many customers, this eliminates their dependence on Citrix
licences outside the need for the more sophisticated and arguably
expensive, third-party tools mentioned earlier.
Microsoft is rarely prepared to see potential licensing
opportunities leaking from its own environment when it can innovate
so well in every new iteration of the Windows Server on the one
hand and deploy .net on the other.
So Citrix management may have to let go its hold on the great
white shark to somehow avoid being eaten by it.
Acting globally, Zentelligence (Research) advises
governments, suppliers, business and the media on the evolution,
application and delivery of leading-edge technologies, and
specialises in the areas of e-government and information
security.
For further information on Zentelligence and its research,
presentation and analyst services, visitwww.zentelligence.com
Setting the world to rights with the collected thoughts and
opinions of leading industry analyst Dr Simon Moores of
Zentelligence.