Citrix Grabs Orbital Data

Citrix Systems has become the latest company to buy its way into the WAN/WAFS optimization space. The software company said today it plans to pay $50 million in cash, plus a vested interest in some stock-based instruments, to acquire WAN optimization vendor Orbital Data by the close of the third quarter. (See Citrix Acquires Orbital.)

Citrix was attracted to Orbital in part because, in addition to offering WAN optimization appliances, it has managed to create software that duplicates the functions of those appliances on a regular PC. Orbital's software will tally nicely with Citrix's remote-site software approach.

According to Mark Templeton, CEO of Citrix, the acquisition adds an important building block in what Citrix aims to make an "end to end application delivery infrastructure" for remote users. On a conference call with financial analysts today, he said that 55 percent of workers access applications remotely -- and that's the market Citrix is after.

Analyst Joe Skorupa of Gartner says Citrix has been building up to this. "Citrix has changed its focus from client/server applications and terminal servers to access to information, regardless of its location," he explains. The purchase of NetScaler last year gave Citrix the ability to support not just client/server but browser-based apps. Now it has another linchpin in securing and optimizing application connectivity.

But it's not yet clear how Citrix will actually differentiate itself in this burgeoning market. Its move is the latest in a frenzy of acquisitions that bring WAN optimization and wide area file services (WAFS) to a range of products. The list of acquirers includes Cisco, Packeteer, F5, Expand, Riverbed, and Juniper. (See Cisco Acts on Actona, Cisco Chomps FineGround, Packeteer Picks Tacit, Expand Snaps Up DiskSites, F5 Hits Accelerator, F5 Snaps Up Swan Labs, and Users Rally Round Remote Solutions.)Initially, Citrix will likely compete most fiercely against F5 and Cisco, although Cisco hasn't yet released all of its hoped-for WAN optimization/WAFS gear. But Skorupa notes that it's "silly" to think of Citrix as having much technological differentiation from its rivals at this point.

Citrix acknowledges this, but according to Wes Wasson, VP of marketing and product strategies, the point is that Citrix has 180,000 remote application buyers, as opposed to buyers who focus on network equipment. That will be the advantage, he says.

Publicly traded Citrix plans to immediately re-release Orbital Data's AutoOptimizer series of Orbital 6000 series appliances and OrbitalEdge PC-based software as Citrix WANScaler products. In September or October, Citrix will release a roadmap that describes how it will integrate WANScaler with other products in Citrix's Application Networking Group, which is responsible for Citrix products that involve network appliances.

According to Wasson, the first Citrix products that will be integrated with Orbital's WANScaler series will be ones that focus on the network edge or client, not the data center. These include Citrix Access Gateway, an SSL VPN, and Citrix EdgeSight, a client-based application delivery package. A management product called Citrix Command Center will also be integrated with WANScaler.

Citrix also will try to combine sales of WANScaler as a remote site product with NetScaler, the WAN optimization software acquired in 2005 that resides in data centers. (See NetScaler Acquired by Citrix and Citrix Picks Up Teros.)Orbital's 60 employees, based in San Mateo, California, will join Citrix's Application Networking Group in San Jose. The team will be lead by B.V. Jagadeesh, Citrix VP and GM for application networking. Orbital claims 75 enterprise customers, including Metrocorp Publishing and the U.S. government.

Orbital's CEO, Richard Pierce, and the company's VP of marketing and VP of sales, will stay for a short transitional period before moving on.

Mary Jander, Site Editor, Byte and Switch