Citrix Forges Alliances for Thin Strategy

Citrix Systems Inc., at once the champion and primary dependent of the still-unproven hosted applications concept, is advancing with major changes to its flagship product and a number of manufacturing deals with third-party hardware makers.

Citrix Systems Inc., at once the champion and primary dependent of the still-unproven hosted applications concept, is advancing with major changes to its flagship product and a number of manufacturing deals with third-party hardware makers.

With the moves, and still convinced that the enterprise will eventually warm to thin-client computing and hosted apps, Citrix is shaking off industry skepticism, a sluggish economy and its own executive-level problems to support the computing model on which its survival depends.

The company this week will announce the next generation of its MetaFrame middleware product, called MetaFrame XP, which boasts improvements in overall management and scalability.

"For us, XP is that platform that has the extensibility and infrastructure built into it that will allow us to take the whole notion to the next level," said Citrix President Mark Templeton at the companys headquarters here.

XP (the name is not related to Microsoft Corp.s product rebranding with the same initials) will come in three versions: XPe for enterprises with as many as 1,000 servers, XPa for up to 100 servers and XPs for departments and single-server applications.

But real-world user concerns such as management, security, scalability, licensing and printing needs have critics questioning Citrixs optimism.

"There is a lot of functionality that is lacking, which may affect deployments in the enterprise," said the CEO of one Citrix reseller.

Yet, others see Citrix as moving in the right direction.

"Manageability is a big plus for us; its something weve asked for," said Thomas Becker, a software development manager at the Atlanta office of Lucent Technologies Inc. Becker is in charge of deploying all Lucent product installations for the United States, and his team of about 250 installers accesses a project management application through MetaFrame. By the end of the year, the system will have nearly 1,000 users worldwide and will run a data warehousing application, he said.

Using MetaFrame saved deployment time but caused new problems, Becker said. "My developers have to touch each one of those six [servers], but were moving to 40 machines. Youll have to touch 40 boxes to make one change." With XP, he said, "youll be able to touch one box."

For Paul Vendittelli, CIO of Royal LePage Real Estate Services Ltd., in Don Mills, Ontario, MetaFrame is a proven solution for his 300 users in 35 branch offices. "If you were starting from scratch today, you might do best to build a pure Web application, but if you have legacy systems to support, then MetaFrame may be your only option," Vendittelli said.

Despite his success with MetaFrame internally, Vendittelli said he cant see a large enterprise renting software from a service provider. "It appeals to the businessperson more than the technical person," he said.

Citrix is working to change that. "The notion of providing an application as a service is just a fundamentally good idea," Templeton said. "It may take a few years to get the technology that supports it to work, or it may not even be the current technology."

The new features of MetaFrame XP are numerous and address a wide scope of user demands. Through an interface called Citrix Management Console—which Citrix officials and beta testers say is based on the snap-in modules for Windows 2000s Management Console—administrators can control server load management and alert notifications, security, printer management, and time zone issues.

XP will work with Tivoli Systems Inc.s and Hewlett-Packard Co.s network management products, it will support Microsofts NetMeeting, and it will allow the embedding of the MetaFrame client into specific executable files, officials said.

Other new features include server farm monitoring, remote desktop control, multiple-monitor support, and desktop panning and scaling, officials said.

Per user, XP will cost $400 for the large-enterprise version, $345 for the small-enterprise version and $290 for the single-application/departmental version. The software can be installed as many times as needed, regardless of how many servers or users per server there are, officials said.

XP in the box

On the hardware side, citrix expects to announce embedded software deals with makers of thin-client terminals, handheld computers, Internet appliances and cell phones. Companies in the partnership roundup include Wyse Technology Inc., Sun Microsystems Inc., Oracle Corp. and IBM, officials said. Partnerships are also under way with personal digital assistant makers Compaq Computer Corp. and HP.

At the CeBIT trade show next month in Hannover, Germany, Citrix will announce deals with Ericsson Inc., Motorola Inc. and Nokia Inc., a source close to the company said.

Hardware alliances, Templeton said, will play "an enormous role" in Citrixs long-term success. Citrix will never make hardware, he said. But, "Our future is directly proportional to the increase in variety in information appliances," he said.

Outside the product activity, Citrix management must find a new CEO. (Templeton stepped down from that position in June but hasnt yet been replaced.) It must also stabilize its battered stock price and deal with widespread uncertainty among top-tier application service providers such as USinternetworking Inc., Corio Inc., Breakaway Solutions Inc. and FutureLink Corp., which have either shed staff, announced losses or refocused recently.

Citrix has carved out prime space in a nascent market, selling some 30 million MetaFrame seats and taking in $470 million in revenue last year. That action has not gone unnoticed. Sun announced its Open Network Environment for software as a service last week, and details of Microsofts .Net platform continue to emerge. Citrix will likely be the underdog competing against those companies when their hosted applications initiatives mature, analysts said.