Charles Babcock, writer for Information Week, reporting from Citrix Synergy Event in Houston – wrote: “Citrix Systems is changing its emphasis on virtualization. From now on, it's less about launching virtual machines in the data center and more about delivering virtual services to user desktops.” Here is the link to the full article: "Citrix Shifts Virtualization Spotlight To Desktops"

This is a very compelling statement that requires further analysis.

- Delivering services to user desktops leveraging virtualization has always been important to Citrix and one of the main reasons they acquired XenSource. So what is the "shift"?

- I think the sentence: "it's less about launching virtual machines in the data center..." provides the answer. The implications are pretty strong that the "shift" is server virtualization isn't a core focus for Citrix going foward. And you really can't be "less" about supporting server virtualization. It is either something you do or don't do.

- This shift isn't really a suprise to us and to some industry experts. Gartner's Tim Bittman said in March 2008: “Citrix acquired XenSource to expand into the Virtual Desktop Infrastructure market (where client VMs are hosted on servers) and to compete in the server virtualization market. The former seems like a rich opportunity for Citrix. The latter will be an uphill battle...”

- We don't really run into Citrix in competitive situations at end user customers or the channel. From our perspective they aren't in the server virtualization business where it counts -in the field.

- This is the smart move for Citrix. Being a major player in server virtualization was never in the cards for them. For one thing, Citrix is missing the equivalent of VMware Virtual Center and Virtual Iron’s Virtualization Manager – which is requisite for true server virtualization. Additionally, their whole business model is around desktop solutions and leveraging this is the right thing for them to do.

- Another factor that must be considered in the Citrix “shift” is Microsoft and the MS Hyper-V solution. Does Citrix really want to compete head-to-head with their biggest strategic partner?

Citrix probably won't agree and will deny that they are "shifting" away from server virtualization. But keep your eyes open. I predict that their actions going forward will fortify my analysis.