Cover Story

Access from afar

A series of acquisitions by Citrix will help the company expand its access infrastructure market, writes Akhtar Pasha.

In early 2003, Citrix outlined its strategy to expand its coverage of the overall access infrastructure category by penetrating into adjacent high-growth markets such as application acceleration, collaboration, and SSL (secure sockets layer) VPN (virtual private network). So what is the significance of taking over NetScaler and where does it fill the gap in the application acceleration market for Citrix?

To understand the company’s strategy we need to quickly recap Citrix’s earlier deals. In 2003 Citrix acquired Expertcity—now the Citrix Online Group—moving the company into the real-time collaboration, desktop access and on-demand assistance market segments. Then in 2004 Citrix bought emerging SSL VPN and IP telephony vendor Net6. This signalled the company’s commitment to push beyond server-based computing into appliances. The first two objectives—collaboration and access to the SSL VPN market—were taken care of with these two acquisitions. The third part, application acceleration, came from NetScaler.

According to IDC, the access infrastructure market where Citrix plays is going to be worth $29 billion by 2007, and is growing at about 11 percent CAGR. Says Kishore Badami, Citrix’s Senior Director for Marketing, “We control 85 percent of this market in India, and our strategy is to expand into access infrastructure markets adjacent to our core access market—the virtualised application market—through acquisition and organic growth. That is precisely why we took over Expertcity, Net6 and NetScaler. We have also continued to improve our current product set, and we have introduced new products in roughly the same timeframe. Through a combination of organic growth and acquisitions, we have grown from a one-product entity to a multi-product company in three years. We are now in a position to offer an access platform, a portfolio of integrated solutions for access that improves IT efficiency, increases data security, enhances workforce mobility and increases business agility.”

According to Gartner, NetScaler will help Citrix scale its SSL VPN gateways, and expand its application access and acceleration offerings to include Web-enabled applications. NetScaler is growing fast enough to make a material difference to Citrix—its growth in India has been 100 percent. Sources at Gartner say that Citrix has a very broad offering now, and is a credible application acceleration player against Cisco Systems, Juniper Networks and F5 Networks. Citrix is keeping the business units separate, but will integrate NetScaler technologies with elements of its access platform where it makes sense. Gartner adds that the consolidation being witnessed in this market will result in limited choices for customers, and that buyers may view this deal as a lock-in move to make Citrix work better with NetScaler than with third-party products. Badami responds that having products from multiple vendors only spreads the risks, and increases the complexity of their IT infrastructure. “With NetScaler we have a complete end-to-end secure access infrastructure solution.”

Application networking

The application networking market comprises three key segments:

• Application acceleration and optimisation, a $1,470 million market growing at 67 percent CAGR
• Application traffic management, a $900 million market, and
• Application security, which is worth about $690 million.

(Source: Gartner, IDC, Infonetics, Frost & Sullivan and company estimates.)

This is the space where Citrix gains the most. Notes Rakesh Singh, Citrix’s General Manager, Asia Operations, Application Networking Group, “There are lots of Indian organisations that are still using low bandwidth links. They can save substantially on bandwidth and gain acceleration in application access by 15x, improve server efficiencies, and ensure high application availability. There are other issues such as increasing number of remote users, Webification of applications, and increased security threats. These are met with a single solution.”

Citrix’s new customer acquisition list has been impressive. It added 135 new clients in 2004, while during the first nine months of 2005 it won 112 customers; what’s more, it expects to close another 40 deals by the end of the OND quarter.

Companies can save on bandwidth, gain acceleration in application access, and ensure high application availability with a single solution Rakesh Singh General Manager, Asia Operations Application Networking Group Citrix	We control 85 percent of the access infrastructure market in India, and our strategy is to expand into markets adjacent to our core access market Kishore Badami Senior Director Marketing Citrix

Lower costs, increased performance

We talked to existing customers of Citrix on how they see the value that Citrix says it passes to its customers. Replied G S Ravi Kumar, chief information officer, Gati, “We have been closely looking at NetScaler products even before Citrix’s acquisition of the latter. Though we are currently evaluating products [NetScaler, Radware and F5], the NetScaler solution has the closest fit, and it [the Citrix-combined entity] brings the best end-to-end access infrastructure solution under one roof.” He explains that NetScaler products are more capable of doing load balancing. The company’s dial-up users (about 100) are handled by Citrix, but it has a huge number of non-dial up users (mostly leased lines) that remotely access four application servers running the in-house-developed GEMS (Gati Enterprise Management Systems) application. The NetScaler AppCompress increases the application payload per packet for Web-based applications. This reduces bandwidth consumption for application access, yielding a reduction in WAN usage and costs, as well as providing increased application performance. Besides, NetScaler provides SSL security at the gateway level. “We anticipate a 40 to 50 percent increase in application performance,” Kumar says.

There are three fundamental things Citrix applies to application traffic and the underlying application infrastructure in order to achieve improved scalability, availability and performance for applications of all types. First, NetScaler offloads a great majority of the server processing and other compute-intensive tasks of servers (such as SSL processing) in order to free up application servers. The end-result is reduced CPU utilisation and more headroom per server that leads to improved scalability. This also means that the organisation will require fewer servers. Second, NetScaler applies high availability functionalities such as server load balancing, Layer 7 content switching, and DDoS (Distributed Denial of Service) attack protection to ensure that the application environment is always accessible. Finally, NetScaler offers key features that speed up applications: advanced compression (to reduce the amount of application traffic that goes over the wire, especially across a WAN, for faster delivery and better bandwidth use), in-memory dynamic and static caching (to get the application data closer to the end-user), and connection multiplexing (to make more efficient use of a server farm by being able to hold persistent connections while minimising the amount of connections made to the back end server farm).

The NetScaler solution drives down cost and improves the performance of the Webification of applications. Customers will be able to reduce the costs associated with ongoing maintenance and application upgrades (NetScaler does so by allowing users to access applications through a clientless architecture—ActiveX applet does all of the HTTP and non-HTTP acceleration—and Presentation Server achieves it basically by centralising applications through virtualised access and delivery).

Value from 64-bit servers?

You have to think about what the transition to the 64-bit architecture will mean overall for customers. The 64-bit environment will allow customers to incrementally get more powerful applications for their businesses. Today, we have the Windows OS and processors that support 64-bit computing. Applications vendors (ISVs) are working to create 64-bit versions of popular enterprise applications for these platforms. We are still a year or two away from seeing these powerful applications in the market, but they are coming. When they arrive, we’ll see heavier data-crunching and more compute-intensive applications. The key point here is that the NetScaler application was never designed with performance in mind, but rather with feature sets and networks, i.e. latency across the WAN. The company plans to bring the same benefits that 32-bit applications gain in terms of the performance part of the application delivery equation to the new 64-bit environment. Adds Badami, “We find huge market opportunity in verticals such as BFSI where security is a prime concern and they are handling many remote workers accessing their network infrastructure. Discrete manufacturing units are extending their enterprise to remote users such as suppliers and customers. Then there are other verticals such as railways, telecom and large technology companies that are extending their network access to remote users.”

Citrix will not stop here. According to IDC, access infrastructure includes 14 segments, including virtual user interface, remote access, conferencing, collaboration, areas of networking and security, and more.

According to IDC, Citrix access software and services currently map to nine of the 14 segments; these nine segments are expected to grow at the rate of 14 percent annually to reach $12.7 billion by 2007. And that’s not all—Citrix hints at more acquisitions in high growth areas.

akhtar@expresscomputeronline.com