Access management
- Article 73 of 77
- Information Age, February 2006
Can Citrix's thin-client technology help it push further into the enterprise to become a mainstay of access infrastructure?
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Budgets drop yet IT requirements are on the increase. Management of desktop PCs is becoming harder and more expensive. Security considerations underpin every new project. Providing mobile and home workers with access to corporate IT assets is becoming almost mandatory. Commerce is moving to the web and the infrastructure and bandwidth need to be in place to support that shift. One company claims to be able to offer the solutions to all these problems. Despite forever being associated with an almost unrelated product, Citrix is that company.
Citrix is best known for Metaframe, a product that enables organisations to run desktop applications on their servers instead of on their client systems. That is more or less where most people's knowledge of Citrix stops. In fact, Citrix hasn't sold a product called Metaframe in over a year – it re-branded it as “Presentation Server” in 2003. And that isn't the only place where Citrix's marketing message is failing to get through.
Citrix has a relatively long history. Launched in 1989, it was founded by a group of former IBM employees. It initially developed a product for OS/2, using technology licensed from Microsoft, that allowed IBM's home-grown PC operating system to support multiple users.
A switch in strategy in 1993 saw the company develop the idea of using PCs as terminals for server-based computing. The company continued to grow slowly, taking in net revenues of just $44.5 million in 1996. But after broadening its product range, launching a channel network and partnering with Microsoft, growth rates rapidly increased, with net revenue leaping to $248.6 million by 1998. Revenue is now on course to hit $1 billion within 2006.
The Microsoft partnership remains the most important of Citrix's 3,000 or more relationships. The company's 1997 deal saw some of Citrix's technology make its way into Windows 2000 Server, giving Citrix royalties and in-roads into organisations that liked what they saw in “Terminal Services” but knew they wanted more. Citrix went on to agree another five-year technology partnership with Microsoft in December 2004.
The Microsoft-Citrix relationship isn't without some tensions, but these are less problematic than many observers believe. Mark Margevicius, vice president and research director at Gartner, says “There is a belief that Citrix and Microsoft are at odds with each other, but I don't think that's anything to do with what Citrix and Microsoft have done to each other. It's because of the way Microsoft treats its other partners.” Citrix and Microsoft have an “interesting” relationship because of their different licensing agreements, argues Margevicius. Unlike Citrix, which allows organisations to buy licences for only the maximum concurrent number of users, Microsoft requires licences for all the users that will ever access the server. As a result, “for every dollar generated in revenue for licensing by Citrix, it generates an additional 75c that goes directly to Microsoft. Last year, in excess of $300 million was generated by Citrix for Microsoft without Microsoft lifting a single finger.” Little wonder Citrix has won Microsoft's Global ISV award two out of the three times it has been awarded, coming runner-up in 2004.
Citrix now has an enviable deployment record, with Presentation Server being used in all 100 of the Fortune 100 companies. The range of applications of its technology is large, but the majority involve thin-client work, usually with PCs and Unix workstations rather than thin client hardware; global consolidation of IT systems; and outsourcing, where data and applications can be in one country and the workers in another to save on labour costs, while potentially circumventing data protection laws.
One customer, law firm Clifford Chance, has 27 offices around the world. The company adopted Presentation Server in late 1999 as a remote access solution, but the software now provides a range of services to 7,000 employees. The majority of users run Microsoft Office on the server, leave their documents there as well, and then work on them remotely from their offices, from home or when they're visiting other offices. Since the data is on the server and never downloaded, it stays secure.
Says John McKeown, director of enterprise architecture for Clifford Chance, “Over the last 18 months, we've consolidated infrastructure, with some of the smaller offices using Citrix as a thin client to get access to the larger hub sites. Part of that is managing costs, since we don't want the same size and level of infrastructure. Part is business continuity and disaster recovery, since we can't have disaster recovery sites for 27 offices.”
Among the other benefits is a reduced level of IT support staff, says McKeown, although training and a different way of thinking is needed to work with Presentation Server. “Lots of people are either server or desktop people. It's a different type of mindset. You need to bring them together.”
Presentation Server has not been without its problems over the years. Latency remains an issue, with clients receiving back the results of their interactions far more slowly than is tolerable in certain situations. Citrix has been working continuously over the years to reduce latency, but certain graphics-intensive programs can still face this issue over large distances. Boeing had to work extremely closely with Citrix's engineers to make its CAD systems work at an acceptable speed for its Australian users and it is still continuing with efforts to improve performance.
Yet at closer distances, even GIS software can be made to work with acceptable performance. Hampshire County Council provides services to 14,000 users via Presentation Server, with roughly 80 of those using ESRI's ArcView GIS software. According to senior IT consultant David Brown, the council tried a client/server approach at first. “We tried to deliver GIS over the WAN, but even over 2Mbps that gave us an unworkable response time – up to 15 minutes for a screen. But over a thin client, it was more or less the same as if you were there.”
Unlike ArcView, however, some applications installed on a Citrix server sometimes need to be adapted to work with the server-based environment. Says systems integrator Dimension Data's business development director, Simon Ratcliffe, “What normally happens is a bunch of consultants will sit there and say. Okay, what we'll do it take every app you're going to run, build a test environment, then spend 100 days testing these apps at £1,000 a day. We have a list of apps. We know how to make them work and most applications go in cleanly.”
Michael McCullen, MD of project management software developer Asta Development, has deployed his programs in a number of Citrix environments, including housing developer George Wimpey. “They use it to allow the business units to access the software. They don't have to administer the software in these units, which are all around the country. The IT guys are excited because the software's all in one room.” To make the software compatible with Citrix took one minor change. But printing, a bugbear for the system for some time, continues to prove an issue. “Bandwidth can be a problem if you're printing from a remote terminal and you're trying to suck the data down from the server so you can print locally.”
Despite these enduring considerations, Citrix offers the most mature of all the server-based computing products and dominates the market. Senior regional marketing manager David Angwin at thin client-manufacturer Wyse reports that the majority of his company's sales involve Citrix software at the server end. But that situation has been changing, “particularly at the lower end. People are using Terminal services more. We're also seeing more people that need just straight web apps.” Citrix this year launched its own low-cost competitor to Terminal Services, Citrix Access Essentials, its first product aimed specifically at SMEs which should see it win back some share of that market. The acquisition of the NetScaler web accelerator software should help it work its way into the web apps market.
At the high end, Citrix has been mainly unchallenged. Its main competitor was Tarantella, but Gartner analyst David Friedlander says that the financial problems of Tarantella caused many organisations to avoid that company's products. Having been bought by Sun this year, the Tarantella product range no longer faces this problem, making it more of a threat to Citrix. However, Sun is liable to deploy its acquisition as a bundle with its Sun Ray terminals and its own servers, rather than on Citrix's mainstay, Windows Server 2003. Friedlander predicts that Sun will almost certainly discontinue the Windows version of Tarantella altogether, making the clashes between Sun and Citrix less infrequent than they may have been.
Looming on the horizon is Microsoft, which threatens an upgrade to Terminal Services, codenamed RAIL (remote application integrated locally), in Longhorn Server. Ironically, many of the improvements will be likely to have come from Citrix, via the recent five-year licensing agreement it agreed with Microsoft. This has the potential to undercut Citrix even further at the low end and to make encroachments into larger enterprises.
When Citrix was a one-product company, this would have been disastrous. It stills remains a significant threat. But CEO Mark Templeton decided in 2002 to diversify Citrix. Citrix was no longer to be purely about server-based computing. Instead it was to be about “access infrastructure” – ways for employees to gain access to resources and people wherever they are, whatever device they're using. It's a market Citrix can quite justifiably claim to lead, since essentially it's the only company in this whole market – although Cisco and Juniper are circling.
Through a series of acquisitions, Citrix now has in its product portfolio Net6's SSL VPN appliance, the NetScaler web performance accelerator and ExpertCity's online collaboration services.
The web accelerator appliance highlights Citrix's growing acceptance that server-based computing isn't suitable for all organisations. “We're moving away from the all-the-time connection model to the intermittently connected model,” says Templeton. Citrix is also developing Project Tarpon, an “application streaming” technology for installing applications from a server for later use offline.
Templeton admits he hopes the company's association purely with thin clients will “die off completely”, but expects it will be some time before the access platform strategy pays off. “Platform strategies take years to play out. Right now the platform means a one-stop shop for everything you need to deliver applications in a controlled, highly secure, managed way and have a collaborative experience.”
Gartner's Margevicius says that the access message is failing to get through, however. “They've had [it] for over two years, and it hasn't made any noise and it's had zero impact with customers. It's a way in which they can put together all their products on a single page, but there's no real underlying integrated technology or architectural differences about what they're doing. It's just one message that doesn't resonate very strongly with customers that I speak to.”
Citrix's financials suggest that even if the overall message isn't getting through, customers are dealing with the new Citrix at a more pragmatic level by buying the products they want. Despite near saturation penetration of the market, Citrix's growth in software revenues continues at the same rate as ever thanks to the additional revenues from its SSL and web accelerator divisions (Citrix classes its appliances not as hardware but as software delivered through a different delivery mechanism.). Its online services division is growing even faster, echoing its former existence as ExpertCity where its revenues grew year on year at 75%.
Citrix is slowly making the transition from a tactical to a strategic supplier and from a server-based computing company to a network and applications management company. It will be some time before the move is complete and it won't be without its risks. But although its change in image is failing to get through to customers' minds, their wallets seem to be buying the new Citrix.
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