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Citrix completes XenSource virtualization buy

Citrix's $500 million acquisition is done. Next up: new server and desktop virtualization products.

Citrix completed its $500 million acquisition of XenSource, the primary sponsor of the open-source Xen virtualization software, the company said Monday at its iForum conference in Las Vegas.

XenSource will become the core of the company's new virtualization and management division, and XenSource Chief Executive Peter Levine will report directly to Citrix CEO Mark Templeton. Xen co-founder Ian Pratt will continue to lead the Xen project and now is a Citrix employee, the company said.

Xen, like competing virtualization packages from companies including VMware, SWsoft, Qumranet and Microsoft, lets a single computer run multiple operating systems simultaneously. The idea caught on initially as a way to consolidate the work of multiple inefficient servers, but now it's the foundation for more fluidly adaptable data centers that can respond to changing work demands or hardware failures. For that market, Citrix will sell a product now called Citrix XenServer, formerly known as XenEnterprise.

Citrix chiefly sells software that lets remote desktops or thin clients tap into desktop software actually running on a server. That approach dovetails neatly with virtualization as a way to run the desktop software on a server, and indeed Citrix said it will release its Citrix XenDesktop software in the first half of 2008. A free preview edition should be available for download on October 29 from the company's Web site, Citrix said.