virtualization.info

The article virtualization.info published just last week about Citrix joining the The Linux Foundation generated a lot of interest and comments.
Simon Crosby, CTO of Virtualization and Management division at Citrix, personally answered a few readers about the reasons behind the value of a free XenServer and the strategy behind it.

In doing so Crosby disclosed very interesting information. First he claimed that XenServer costs to VMware $300MM per year in lost revenue, probably a Citrix internal projection considering its current market share.

Much more important than that, today Crosby candidly unveiled that Citrix is about to fully open source XenServer.
You read right: the company CTO is not talking about Xen, which is already developed and maintained by the open source community. He’s talking about its commercial implementation, XenServer, where Citrix invested so far, that is offered as a free product since February and that the Burton Group considered as enterprise-ready as VMware ESX.

Here’s his full answer that contains the breaking news:

XenServer is 100% free, and also shortly fully open sourced. There is no revenue from it at all. That is strategically aligned with our goal to increase market share, get directly to customers and also provide Citrix customers with virtualization built into our core products as a core capabiliy, so every XenApp customer has free support for XS built into their XenApp entitlement, ditto for XenDesktop. Our positive revenue comes form Essentials for XenServer and Hyper-V, which adds all of the automation functions for management of virtualized environments and self-service virtual lab and stage management. This is a substantial business, growing rapidly, but also offers customers value through inclusion in the value-added stacks (Enterprise/Platinum editions) of XenDesktop and XenApp. It is therefore not possible to make a direct head to head comparison with VMware, which doesn’t have a competitor to XenApp, and whose competitor to XenDesktop doesn’t scale at present.

Crosby further confirmed his words after the comment above.

This move may or may not increase the Citrix market share, and may or may not oblige VMware to drop the price of ESX earlier than expected.
virtualization.info will publish additional details as soon as they are available.

Meanwhile it’s worth considering what Oracle and Novell will do after this will be formalized.
Both companies have their own implementations of Xen, and both are working to release more sophisticated platforms that offer the same features that XenServer offer today.
If Citrix gives away the code, does it make any sense for Oracle and Novell to continue their own development of the hypervisor?

It will also be interesting to see if this move will generate more virtualization players, as it makes so much cheaper and easier to enter the virtualization market by focusing just on the management layer.

Update: Citrix reached out virtualization.info to add an official statement to this move:

XenServer is offered to the community as the basis for the Xen Cloud Platform (XCP).  There will be substantial additional contributions coming from other community partners, but we aim to make all of our technology in XenServer (other than XenCenter, which is a stateless Microsoft .NET client GUI and therefore not appropriate for the XCP community and its intention to make a great cloud platform for large scale clouds to consume and automate using their automation and management systems) available to the community in OSS. 

Other features will come in too, like the Open vSwitch, and we will drive from there to develop additional storage repositories and so on.  But the key emphasis is the use of XCP as a platform for the entire community, with a starting point, for which we have offered the code base of XenServer. 

Key partners such as VA Linux, Oracle, Novell, Fujitsu and Intel and AMD are all committed to the ongoing delivery of additional value to the platform, which will therefore have multiple routes to market, a strong ISV community and hopefully deliver revenue to a broad sector of the market.