Citrix acquires XenClient competitor Virtual Computer

Sources close to Virtual Computer say Citrix acquired the company for its client hypervisor and desktop management product, NxTop.

Citrix has acquired Virtual Computer, a small client hypervisor and desktop management startup with a product that competes with XenClient, sources said.

Neither Citrix Systems, Inc. nor Virtual Computer have disclosed the acquisition, which sources close to the matter said will be announced by Citrix at its Synergy conference in San Francisco this week.

Citrix invested in Virtual Computer, Inc. in 2009 and industry experts expected Citrix to acquire the venture-backed company to add the NxTop client hypervisor to XenDesktop. This would have been an easy way to add offline virtual desktops to its virtual desktop infrastructure (VDI) capability list.

Instead, Citrix built its own Type 1 client hypervisor and delivered XenClient in 2010. It has since competed against NxTop and another client hypervisor vendor, MokaFive, Inc.

Many insiders say Virtual Computer's NxTop outshines XenClient, despite Virtual Computer being a relatively small company that should be the underdog to Citrix.

While Citrix has XenClient XT -- the hardened version of XenClient -- in its favor and has solved the battery life issues involved with running a client hypervisor, "Virtual Computer has made more headway in the mainstream enterprise desktop market with better management and support for a wider range of devices, as well as having some solid sales behind it," said Simon Bramfitt, an independent analyst with Entelechy Associates LLC, an IT consultancy based in Concord, Calif.

In addition, NxTop doesn't require Intel v-Pro chips, as XenClient initially had, and it provides virtual desktop management capabilities. NxTop also integrates with VDI products such as XenDesktop and VMware View, as well as commonly used management software such as Microsoft System Center.

Why acquire Virtual Computer?

Some worry that Citrix has acquired Virtual Computer to eliminate the competition.

"Word is that [Virtual Computer] was bought for a song by Citrix in order to take them out as competition, because why not, and it was costing them XenClient sales," said Guise Bule, CEO of tuCloud and head of the Desktop Superhero Alliance, a community of people interested in desktop and app delivery technologies. Members of that group on LinkedIn have been speculating about the sale of Virtual Computer for weeks now.

Others expect Citrix to use NxTop to its advantage.

"It would make more sense for Citrix to merge the two products and introduce a standalone version of XenClient while continuing to offer it as a feature of XenDesktop," Bramfitt said.

One NxTop customer who deployed the client hypervisor to simplify a Windows 7 migration from Windows XP last year said NxTop could help Citrix gain VDI business.

"This kind of transaction was inevitable given Citrix's push to reinvigorate VDI," said Nathan McBride, vice president of IT for a pharmaceuticals company based in Lexington, Mass.

More on Virtual Computer:

Citrix integrates NxTop and XenClient

Virtual Computer's CEO dishes on virtual clients, Microsoft and Intel support

Client hypervisor executes desktops locally, uses centralized storage

Citrix needs to "reinvigorate" VDI, McBride said, because the market has shifted away from OS-dependent computing and toward browser-based computing. In fact, McBride ditched NxTop and his entire VDI strategy in favor of a computing model that does not depend on Windows desktops.

"We are simply at the point where the OS does not matter, nor do we want it to matter," McBride said. "It is only the browser that matters ... and in that case, for us anyway, VDI is dead."

Other types of desktop virtualization, including cloud and client-side virtualization, offer an alternative to high-cost VDI projects.

In fact, Intelligent Desktop Virtualization -- the term that Virtual Computer and Intel Corp. use to describe client-side virtualization -- is likely to gain at least 25% of the desktop market compared to 6% for VDI, according to a phone survey of 101 members of the Entelechy Associates Desktop Leadership Panel. (That report will be published later this month.)

"This move will secure Citrix a much larger segment of the enterprise desktop than it would ever have done with XenApp and XenDesktop alone," Bramfitt said.

Now, it will be interesting to see how competitor VMware responds. This "could make MokaFive an attractive acquisition target," Bramfitt added.

Virtual Computer and Citrix did not respond to requests for comment.

Virtual Computer NxTop 4.1 features

It remains to be seen how Virtual Computer's product will fit into Citrix's portfolio, but Virtual Computer said last month it would demonstrate NxTop 4.1 at its annual conference this week. It planned to release this version of its client hypervisor by the end of May.

With this latest release, NxTop broadened its hardware compatibility to include support for the latest Intel Core chips. New features include:

  • Role-Based Management that lets corporate IT define and create admin roles that have specifically defined capabilities such as creating and managing VMs, and defining and managing policies.
  • Improved Active Directory integration with the ability to directly browse the AD hierarchy and integrate the entire domain, selected OUs, or specific end users.
  • An updated management interface with more search capabilities including the ability to search or apply persistent filters to users, groups, and computers.

NxTop 4.1 also brings better storage and backup controls.

Read our complete Citrix Synergy 2012 conference coverage here.

Let us know what you think about the story; email Bridget Botelho or follow @BridgetBotelho on Twitter.

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