Citrix to axe VDI-in-a-Box as company restructures

In addition to letting 900 employees go, some Citrix products will be eliminated as part of a re-organization, with VDI-in-a-Box the first to go.

VDI-in-a-Box will be a casualty of a Citrix company-wide restructuring plan as it turns its focus to other products.

As part of Citrix's Q4 2014 earnings call this week, the company said it would either move on from or reconfigure some products, and eliminate 900 total employee positions; 700 full-time and 200 contractors.

Products that have small revenue or aren't necessary to the company's strategic goals will either be discontinued or transitioned from being "products" to "features," said Mark Templeton, Citrix CEO and president.

Citrix will stop selling VDI-in-a-Box and it will be replaced by "a simpler and more price-competitive version of VDI," Templeton said.

The [XenDesktop] architecture is more polished and the amount of configuration needed to make it work is a great deal simpler.
Simon Bramfitt, founder Entelechy Associates

In addition, AppDNA, which allows conversion of physical-to-virtual Windows apps, will go from a standalone product to a feature in the platinum versions of XenApp and XenDesktop.* 

There is no timeline for the end of VDI-in-a-Box and the product will continue to be fully supported as part of its normal lifecycle, a Citrix spokesperson said. Citrix will have alternative options available for customers when VDI-in-a-Box ends, the spokesperson said.

An indication of Citrix's plans to scale back investment in some products was apparent last year in a interview with Gunnar Berger, Citrix's desktop and apps CTO. Berger didn't name specific products but said Citrix would be investing "in strategies that we see as the future -- and de-investing in strategies that don't."

Citrix acquired VDI-in-a-Box from Kaviza in 2011 as a low-cost alternative to XenDesktop for SMBs.

But over the last several years, XenDesktop became easier to use and implement, rendering VDI-in-a-Box less important, said Simon Bramfitt, founder of Entelechy Associates in Concord, Calif.

"The [XenDesktop] architecture is more polished and the amount of configuration needed to make it work is a great deal simpler than it used to be," Bramfitt said.

Citrix's recent purchase of storage virtualization vendor Sanbolic and plans to introduce the WorkspacePod converged infrastructure offering could have played a role in its decision to axe VDI-in-a-Box, said Robert Young, client virtualization software research manager with IDC in Framingham, Mass.

"The WorkspacePod could be the replacement and it's not necessarily surprising they'll put more focus on that," Young said.

Customers moving to more application virtualization and remoting as opposed to full desktops lessen the need for a product like VDI-in-a-Box as well, Young said.

Moving AppDNA into the platinum versions of XenDesktop and XenApp was also sensible as it was licensed per-application and was only optional as a separate entity, Bramfitt said.

Citrix to focus on workspaces, networks, mobile

Citrix will restructure its business around three units: workspace services, delivery network and mobility apps. It will invest more in mobile apps including data sharing, collaboration and the Worx mobile apps suite and shift resources to more networking coverage to expand NetScaler globally.

NetScaler may be helped if Citrix presented it more as a platform that works as an application delivery controller without XenDesktop and XenApp, Bramfitt said.

Citrix anticipates the layoffs will save between $90 and $100 million on an annual basis. The company had 9,166 employees at the end of 2013.

Citrix reported 6% revenue growth from Q4 2013 to Q4 2014, increasing from $802 million to $851 million. Citrix saw revenue growth from $2.92 billion in fiscal year 2013 to $3.14 billion in fiscal year 2014, an 8% increase. However, annual net income for fiscal year 2014 was $252 million compared to $340 million for fiscal year 2013.

Citrix gave a preview of some end user computing product releases customers can expect this quarter on the earnings call. For XenApp, customers will soon get support for Linux-based VDI and remote apps, HDX screen recording and a tech preview of HDX with integrated Framehawk technology for user connecting over WiFi, cellular or satellite networks.

XenMobile 10.0 will also be released this quarter and include an integrated backend that combines the platform's mobile device management and mobile application management capabilities into one unified infrastructure.

* A Citrix spokesperson clarified this change was effective with the 2014 release of XenApp and XenDesktop 7.5.

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