Here are the stories and conversations that people are thinking and talking about this week:
Regarding the Citrix and XenSource Deal
- This piece from The Deal talks about the possibility of Microsoft outbidding Citrix and maybe going after XenSource directly. (Thanks to Jeff Pitsch for pointing this out on Bink who pointed it out on The Deal.)
- InformationWeek had an interview with Citrix's global head of marketing Wes Wasson and XenSource's CEO Peter Levine about the open source future of Xen and the integration of the two companies.
- VMware sent a very strong letter to their partners trashing Xen and XenSource. Classy!
- Michel Roth wrote an interesting blog entry where he suggests that Citrix picked up XenSource mainly for the value they will someday add to Viridian, rather than for the value they add to the Xen hypervisor today.
- There have been hundreds of stories (Google News Search) and thousands of blog entries (Google Blog Search) about the acquisition. The general feeling seems to be positive, although some open source people are very not happy.
- Where does this deal leave someone like Virtual Iron? Should they be looking for a nine-figure buyout now?
After a week of thinking and talking to more people, Brian now believes that Microsoft had a bigger part in this deal than we originally thought. Citrix has recently stated (before the XenSource acquisition) that VMware was their biggest competitor. And Microsoft is saying that VMware is a big competitor. (To be honest, we're not sure why either company thinks this.) But if Microsoft and Citrix have a common enemy, does that make them automatic friends?
SInce Viridian is now delayed until at least six months after the Windows Server 2008 launch, and since it had many of its really cool features removed, my guess is that Microsoft needs someone like Citrix to offer value on top of their hypervisor in order to go up against VMware, and it seems that the XenSouce stuff that Citrix just bought could be just the ticket needed to do that.
Just imagine? Microsoft could call Citrix on the down-low, get them to buy XenSource. That gives Citrix some revenue in the virtualization space. Maybe Microsoft makes other source code guarantees. Microsoft can have (what's approaching) a viable competior to VMware in their pocket. It's possible?
In Other News
- NetworkWorld named the "10 virtualization companies to watch." Among them is Provision Netowrks. Provision has done a great job transforming themselves from "just another Terminal Server add-on" product to a leader in the virtualization space with their Virtual Access Suite. (The Virtual Access Suite is years ahead of what Citrix is doing in many ways, especially in the area of integrating VDI and SBC application delivery into a single platform.)
App Delivery Companies in the Stock Market
- Citrix (CTXS) closed at $34.99 last night, up from $32.27 a week ago
- Microsoft (MSFT) closed at $28.30 last night, up from $28.10 a week ago
- VMware (VMW) closed at $70.20 last night, up from $57.33 a week ago
VMware's market cap is now $26B, compared to $6B for Citrix. In other words, the market views VMware as 4x more valuable than Citrix. Of course for a quick dose of perspective, Microsoft's market cap is $265 billion, or roughly 10x VMware and 44x Citrix's.