XenServer is alive and well

All FUD aside, Jon Oltsik says Citrix continues to invest in and benefit from its acquisition of XenSource and its server virtualization product, XenServer.

Whenever a big technology vendor acquires another, rumors about success or failure are sure to follow. Generally there is a bit of a grace period, but six to nine months down the line, the grapevine gets active with tales of woe, and Wall Street really pays attention.

Symantec still gets questioned about Veritas, while EMC can't shake scrutiny about RSA. Now Citrix has joined this club as many industry and investment pundits are questioning whether Citrix got its money's worth when it bought XenSource last August. The doubting Thomases say that Citrix is failing in the virtualization server market and is slowly fading away and seeding this space to VMware and Microsoft.

When ESG's virtualization guru Mark Bowker heard these whispers, he asked Citrix for a few post acquisition server virtualization metrics to judge for himself. Based upon this information, it appears Citrix continues to invest in and benefit from its acquisition of XenSource and its server virtualization product, XenServer. For example, Citrix says that XenServer sales continue to double each quarter and that all the major x86 server vendors are actively bundling and shipping the product. Citrix has also increased the number of trained XenServer resellers from 300 to more than 2,500 in that timeframe. Finally, Citrix is making internal investments in sales and marketing staff and actually delivered a new version of XenServer this March. Sounds like progress to me.

In 1987, I entered the tech industry workforce and competed head-to-head with IBM for sales. At that time, IBM was masterful at a sales tactic called FUD (i.e. fear, uncertainty, and doubt), using innuendo and rumor as a way of dissing the competition. Times have changed, but FUD remains a key competitive sales tactic. In the Internet age however, sales-based FUD quickly turns into industry and Wall Street rumor.

The naysayers never die and Citrix is now caught in the vortex. The only way out is communications, continuing progress, and more success metrics like these.

Jon Oltsik is a senior analyst at the Enterprise Strategy Group.
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