Does Citrix have any chance to take on VMware?

"NO!", says this analyst.

To put it bluntly, Kumar does not that Citrix is going to reach its goals. “Citrx’s acquisition of XenSource is an exploration of how a successful software company has underestimated the difficulties of entering a tangential market,” he writes. “Half a billion dollars is just the beginning of the investment Citrix will need to pull off its vision of a working system software ’stack.’ Ironically, the ’stack’ is meaningless to customers. VMware’s success has nothing to do with a stack, but instead on the opposite concept - widespread partnering.”

Kumar notes that Citrix has forecast that the XenSource business can grow to $50 million a year in revenue next year from $5 million this year; he thinks that “it should feel happy if it achieves $15 million.” He says that for Citrx, “future success depends heavily on Citrix’s ability to maintain an R&D budget to keep pace with VMware and Microsoft - and that does not seem to be in its current plans.”

Mmmm..some hard words from an analyst. Read on...