Earlier this week Citrix announced its Q2 2010 financial results.

The company announced $458M in total revenue, with more than $100M in cash flow.

New license sales were $149 million, up 15% from last yearLicense updates increased 13%.
Tech services grew 35%, online SaaS revenue (from the GoTo business unit) was $89 million, up 18% year-on-year.

In the Americas region Citrix revenue grew 17% from last year, in EMEA 11% year-on-year, and in APAC 31%.

Easy to expect the company reports a major growth for the XenDesktop business: in Q2 Citrix closed 18 transactions for over $1M each, 13 for over $18M and some for $5M. Some of these deals have more than 25,000 seats. 
During the quarter 3,500 customers purchased XenDesktop: 1,000 are new customers, the others are XenApp customers that used the XenDesktop Trade-up program.

This conversion of existing XenApp customers is especially interesting: Citrix reports that 20% of renewable XenApp licenses in Q2 were instead converted in XenDesktop licenses. In Q1 2010 the conversion rate of renewable XenApp licenses was 10% only. Plus, the average XenDesktop deals are 3x bigger than the XenApp ones. 
If the trend continues one may envision a future where XenApp as a stand-alone product doesn’t exist anymore.

Another very interesting point is that only 1/3 of the XenDesktop customers now use VMware ESX as the backend hypervisor. Unfortunately Citrix doesn’t specify the XenServer and Hyper-V breakdown.

Overall, The XenDesktop revenew is equal to $290M, 15% more than last year.

For Q3 Citrix expects total revenue to be in the range of $450M to $460M.
For full year 2010 the company instead expects total revenue will be in a range of $1.81B to $1.83B.

During the call Mark Templeton, Citrix CEO, claimed that Xen is now powering 2/3 of all public clouds worldwide, including of course Amazon EC2.
Of course he also mentioned how part of these Xen installations are being converted in XenServer installations, including the one that powers The Rackspace Cloud.

Templeton also reports that Citrix has now more than 460 cloud providers that signed up to deliver the Citrix Cloud Solutions framework.

During the Q&A session Templeton also provided a juicy comment on competition, specifically about Quest:

Question from Bhavan Suri – William Blair & Company L.L.C.
And then just one quick question on competition on the desktop virtualization side — and I’m not even going to talk about [indiscernible] (1:09:21) anymore – but have you seen Quest at all and do you know they’ve also been highlighted quite effectively as a big Microsoft partner in the VDI space, and how should we think about Microsoft’s relationship with them vis a vis you, and how you guys, whether you run into them or not competitively?

Answer from Mark Templeton
Well, first of all, I don’t have total visibility, and with that as a caveat, I’d say anecdotally, Quest gets considered in some cases but they get eliminated very early on. And I’d say when it comes to the strategic conversations, as they go up to the executive suite and these conversations are really about the kinds of business initiatives I talked about, technology things and some of the things I said in the prepared comments. Quickly, everyone drops out because this full range of virtual app models and virtual desktop models are really required to end up with a strategic kind of engagement with the customer. So that’s how the competitives look and our win-loss rate is remarkable on the win side, in the high-90s, 90 percentile, and the losses are miniscule.

Thanks to Seeking Alpha for the earnings call transcript.

Labels: Citrix

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In March 2009 virtualization.info published an article titled Quest uses Surgient, why not acquire it? suggesting that such acquisition would fit the Quest expansion plans and would be the natural evolution of a pre-existing relationship between the two.

Quest answered today to that question by announcing in fact the acquisition of Surgient for an undisclosed sum.

Surgient is one of the very first startups that populated the (almost empty) virtualization ecosystem in 2003.
The company initially launched a hosted virtual lab automation (VLA) solution. In 2008 it changed its business model, allowing customers to install the product on premises and reshaping its strategy to market the platform as a VM lifecycle solution rather than a VLA solution.
In 2010 Surgient changed again: it dropped the concept of VM Lifecycle Automation entirely and fully embraced the private cloud automation hype.

Quest will include Virtual Automation Platform (VAP) in the Vizioncore portfolio. There, the Surgient technology will be probably merged with another orchestration product that Quest owns: vControl, launched in September 2009.

Both Surgient and Vizioncore brands will disappear in one month from now, as Quest already announced the plan to rename the former as Quest Software Desktop Virtualization Group starting September 1st.

The acquisition is expected to be closed within the Q3 2010.

The virtualization.info Virtualization Industry Radar has been updated accordingly.

Labels: Acquisitions, Quest, Surgient, Vizioncore

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Yesterday Oracle announced a major deal with Dell and HP: the two OEMs will certify and resell the Oracle VM virtual infrastructure, along with Oracle Solaris x86 and Oracle Enterprise Linux.
Those customers that will buy Dell’s and HP’s Oracle solutions will have full access to the Oracle Premier Support.

It sounds odd considering the Oracle’s tagline adopted after the acquisition of Sun, Software. Hardware. Complete., to push the idea of an end-to-end computing stack available from a single vendor. But it’s understandable that this is an attempt to increase the Oracle VM market share.
And, market share or not, Oracle VM Server now officially becomes the fourth hypervisor available out-of-the-box in industry standard servers, side by side with Citrix XenServer, Microsoft Hyper-V and VMware ESX.

It will be interesting to see how this will impact the Oracle presence one year from now.

Labels: Alliances, Dell, HP, Oracle

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In April Microsoft announced the beta program for the Linux Integrated Services (LIS) 2.1 for Hyper-V.
Among the many new features, the package introduced support for up to 4 vCPUs inside Novell SUSE Linux Enterprise Server (SLES) and Red Hat Enterprise Linux (RHEL) guest operating systems.

Yesterday Microsoft finally released it.

Besides the 4 vCPUs support for SLES 10 SP3 and 11, as well as for RHEL 5.2-5.5, LIS 2.1 also includes:

• Driver support for synthetic devices
  LIS 2.1 supports the synthetic network controller and the synthetic storage controller that were developed specifically for Hyper-V.
• Fastpath Boot Support for Hyper-V
  Boot devices take advantage of the block Virtualization Service Client (VSC) to provide enhanced performance.

• Timesync
  The clock inside the virtual machine will remain synchronized with the clock on the host.
• Integrated Shutdown
  Virtual machines running Linux can be gracefully shut down from either Hyper-V Manager or System Center Virtual Machine Manager.
• Heartbeat
  Allows the host to detect whether the guest is running and responsive.
• Pluggable Time Source
  A pluggable clock source module is included to provide a more accurate time source to the guest.

The first version of Hyper-V was released two years and one month ago. The first version of LIS (formerly called Integration Components for Linux) was released in September 2008.
While Microsoft may have had just a few inquiries for this feature, it’s still true that the company is trying to compete against VMware in the enterprise market where companies need high performance virtual machines for both Windows and Linux guest operating systems. it’s absolutely stunning that Microsoft took two whole years to introduce 4 vCPUs support for Linux VMs. Hopefully customers won’t have to wait another two to have 8 vCPUs support.

Also, Microsoft didn’t provide any update about its plan to submit LIS to the Linux kernel maintainers for inclusion in a future release.

Labels: Microsoft

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A couple of days ago VMware officially validated an end-to-end Fibre Channel over Ethernet (FCoE) hardware configuration provided by Cisco and NetApp.

The solution includes Cisco Nexus 5000 Series switches and NetApp FAS3100 and FAS600 series SANs, now included in the vSphere 4.1 hardware compatibility guide.

To be fair, the three companies already presented a hardware configuration that could support end-to-end FCoE n December 2009, with a paper titled Designing Secure Multi-Tenancy into Virtualized Data Centers.
In that document anyway FCoE was suggested as an optional alternative to standard Ethernet or Fibre Channel, which doesn’t imply VMware was supporting the protocol at that time.

Labels: Cisco, NetApp, VMware

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The Linux Professional Institute (LPI) just announced the LPI-304 exam, titled Virtualization and High Availability.

The exam is elective for the vendor-neutral Linux Professional Institute Certification (LPIC)-3 and includes virtualization (Xen, KVM, OpenVZ, VirtualBox), load balancing, cluster management and cluster storage.

Interestingly, LPI has assigned a weight of 10 to the questions about virtualization theory and the ones about Xen, while just 7 to the ones about KVM, and just 3 to the questions about other solutions (OpenVZ and VirtualBox).

Like every other LPI exam, the LPI-304 is available at Prometric and VUE testing centers.

Labels: LPI, Training

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