16 August 2002 Citrix Systems has come under fire from one of its users who has complained about the thin client software vendor’s technology road map and accused it of “abusing” its customer base. The customer, New York-based Veracicom, has defected to rival Tarantella instead.
Veracicom founder and president Mike Hjorleifsson said that he made the decision as a result of rising dissatisfaction with Citrix’s product developments plans and strategic direction. “Citrix is abusing its customer base,” he said.
Both Citrix and Tarantella provide software that allows users to access applications running on central servers via a common web browser interface, regardless of their location. Citrix is the market leader in this sector, with an estimated four-fifths market share, according to analysts Giga Information Group.
But according to Hjorleifsson – a long-standing user of Citrix’s MetaFrame software – Citrix’s technology vision “stopped dead in its tracks” with the departure of founder and chairman Ed Iacobucci in June 2000.
Hjorleifsson gave three main reasons for Veracicom’s switch. First, he said, Tarantella has been more innovative in server-based computing. In particular, it supports the Linux open source operating system. Veracicom, he claimed, had lost a number of sales to the education market because of Citrix’s failure to support Linux.
Second, he said that Citrix had lost focus in recent years, pointing to the company’s March 2001 acquisition of portal software vendor Sequoia Software. Finally, Hjorleifsson felt that Tarantella offered better support to ASPs.
But Larry Ritter, senior director of product management at Citrix, rejected Hjorleifsson’s claims. “MetaFrame customers deploy the technology to enable employees to access personal productivity applications. That style of application is not widely deployed on Linux servers, where you’ll more commonly find Linux web server software or file server software. If user productivity applications become widely available on the Linux platform, then we may reconsider, but to date, we haven’t seen a business case for doing so,” said Ritter.
He also denied that the Sequoia acquisition had caused Citrix to lose focus, pointing out that the purchase of the XML-based software is fuelling Citrix’s expansion into new areas such as portals and web services. Finally, he said, Citrix is “entirely satisfied” that its distribution channels are working well.
“I don’t know much about Hjorleifsson or Veracicom,” he said. “I do know that, yes, a relationship existed and, no, it no longer does. And there’s bound to be some energy associated with that change of business relationship.”
The loss of Veracicom is unlikely to constitute a major blow to Citrix’s business, said Giga analyst David Friedlander. The acquisition of Sequoia, he added, gave Citrix a broader portfolio of offerings and raised its visibility. The company has also moved beyond its traditional arena of Windows environments, developing a version of MetaFrame for Unix, although sales of this product accounted for just 1% of 2001 licence fees.
While Tarantella has “world-class technology”, it is struggling in a market dominated by Citrix, said Friedlander. The company, “has a solid alternative product to Citrix MetaFrame”, but its frail financial condition “makes it a risky bet for enterprise customers,” he added.
Hjorleifsson said that this risk does not bother him. “If the technology works and the provider can promote, develop and deploy its technology efficiently, then I couldn’t care less where it comes from.”