Highway builder opens secure fast-lane

By ADAM GIFFORD

NEW YORK - Times Square, March 18, 9.30am: Citrix chief executive Mark Templeton presses the button opening the Nasdaq technology sharemarket.

The Kodak moment precedes Templeton laying out the future for Citrix technology, which allows computer users to access applications and data remotely.

As users increasingly want that access from any device anywhere and at any time, Citrix is making a play to be the leading provider of "access infrastructure" - a technology layer it thinks will be as ubiquitous as the Windows desktop.

But Templeton's big day is under the shadow of the "48-hour deadline" speech by President George W. Bush the previous evening. CNBC bumped Templeton from its breakfast show at the last minute so it could quiz a CIA analyst and a retired general.

"I watched them. They weren't anywhere near as interesting as I would have been," Templeton laughs.

The 14-year-old Citrix is best known for its MetaFrame presentation server, a nifty piece of software that allows people to work on applications held on a central server.

It is known as thin-client computing - the processing load is carried on the server, so the user's machine (or client) does not need to be particularly powerful because it only needs to display screen changes.

In some ways Citrix undersold what it had. Companies would buy MetaFrame to resolve some difficulty they had getting a particular application to work on a network, or to provide a remote office or subsidiary business with access to their systems.

Financially strapped information systems managers discovered that by using Citrix they could turn older PCs into dumb terminals.

Or they could buy specialised thin-client devices without hard disks, which cost less, took up less space in the office and did not need to be upgraded whenever Microsoft put out a new operating system or another processor-hungry version of the standard application.

Citrix allowed users to extend the life of older applications, rather than replace them with new packaged software designed to work over the internet.

Workers became more productive because applications were not crashing their machines, or because they could work remotely or from home.

The question that has always hung over the company, given the symbiotic relationship it has with Microsoft, is "When will Microsoft buy Citrix?"

At today's valuation of about US$2 billion ($3.6 billion), it is not a big ask for the deep pockets of Redmond-headquartered Microsoft.

The answer is probably that the time has passed for that to happen, and Citrix's new strategy, broadening and deepening its range, makes it even less likely to happen.

As it is, Bill Gates is making plenty from Citrix. Every sale of a Citrix licence means the sale of a Microsoft server to run it on, plus any client licences.

Citrix calculates it generates at least US$209 million a year in Microsoft sales, making it one of Redmond's top 10 independent software vendors.

There is also little chance Microsoft will be able to supersede Citrix. Microsoft has 50 people in its terminal server development team, whereas Citrix has more than 500 developers working on the technology.

Citrix has also taken its products beyond Microsoft, adding more security features, more remote management, monitoring tools and support for non-Microsoft technologies.

The Citrix ICA (Independent Client Architecture) protocol now supports Windows, Dos, Unix, Macintosh, Java and web browsers.

It even has a version for IBM's OS/2 operating system, which is still used by some big European financial and telecommunications firms.

On the server side, Citrix allows users to access applications running on various flavours of Windows and Unix.

The company's revenue last year was US$527 million and its products were used by 50 million people in 130,000 organisations worldwide.

Templeton describes MetaFrame as a "grand-slam product" with more than 90 per cent of the market for server-based computing.

The first product to be release in the new Citrix MetaFrame Access Suite, MetaFrame Secure Access Manager, salvages the NFuse Elite portal, which was pitched at the market incorrectly and had disappointing sales as a consequence.

Nfuse allowed people to use Windows or Unix applications through a web browser. The new version bundles in security software, which was sold separately, and user authentication technology so people do not need to remember multiple passwords.

Like Metaframe, NFuse will now be licensed for concurrent users, and not as it was by named user.

As Templeton puts it: "The right way to license infrastructure is concurrent usage. It is like a highway versus a tollway.

"Most roads are highways for concurrent usage."

The company is also backing off the portal business - even though NFuse was built with technology acquired from portal start-up Sequoia. In the Citrix world view, a portal is just another application its presentation server can punch through to.

New Zealand has been a good market for Citrix, as companies and Government agencies struggle to provide applications to staff in remote centres at a reasonable cost.

Systems integrators such as Computerland and Gen-i have built expertise in Citrix technology, which in the case of the latter has provided the basis for a profitable expansion across the Tasman.

But the big challenge they and Citrix face is getting customers to buy into this new vision of the technology stack, which makes Citrix an integral part of any enterprise computing system.

Citrix will then be under immense pressure to keep delivering as technology evolves, starting with a solution to providing secure access to corporate applications from wireless devices.

When you position yourself as the infrastructure provider, the highway builder, the road goes on and on.

* Email Adam Gifford

* Adam Gifford travelled to New York as a guest of Citrix.