Citrix sees strong channel momentum, dismisses reported disaffection over Elliott deal

Citrix denies that last week’s Co-operation Agreement will have negative implications for partners, and says that strong showings by newly-specialized partners has the company on track to achieve this year’s channel goals.

John Carey Citrix 300

John Carey, Director of Worldwide Channel Programs and Strategy at Citrix

Last week, Citrix entered into a Cooperation Agreement with hedge fund manager Elliott Management, which will see long-time CEO Mark Templeton eventually step down, Elliott Senior Portfolio Manager Jesse Cohn appointed to the Board of Directors, replacing veteran Board member Asiff Hirji, and another additional independent board member agreeable to both Citrix and Elliott to be added.

For Citrix’s many channel partners, the key issue is what all this will mean to Citrix’s go-to-market strategy and the strength of their Citrix practices. Last Wednesday, a story appeared in CRN which reported that in two cases at least, the implications would be disastrous. Two unnamed sources, identified as CEOs for top Citrix enterprise partners, said they would be de-emphasizing their Citrix practices and switching resources to Citrix rival VMware.

Citrix has been strongly critical of the CRN story, denying that the cited sources are representative.

“We are keenly aware of the CRN story,” said John Carey, Director of Worldwide Channel Programs and Strategy at Citrix. “All of the quotes are anonymous. They also don’t align with what we have been seeing from our top and most invested partners. We have partners prepared to go on the record with a very different view.”

Of course simply because a vendor denies a story that appears in the media doesn’t mean the story is inaccurate. Carey did point out, however, that the most likely candidates to be sold off if and when Elliott gets its way are not significant channel businesses, so the implications of their sale would be minimal from a partner perspective.

“The divestitures they are talking about are specific to the Go To family of products and to ByteMobile,” Carey said. “The Go Tos are primarily direct and retail with a SaaS referral fee, while ByteMobile is from an acquisition and has never been available through the channel.”

Carey said that Citrix’s recent channel momentum will continue going forward.

“It has been very clear that we are doubling down on the channel, from our announcements at the beginning of this year and the increase of incentives,” he said. “What we have heard and seen is a desire to pivot back to the most profitable channel element. 90 plus per cent of all of our bookings continue to be through the Citrix channel. Even an earlier pivot away only took us from 96 to 90 per cent, and now we are back to that broader channel motion.”

Citrix also sees the strong partner response to the specializations system it introduced early this year as evidence of strong channel support.

“What we have seen is very pleasing, with strong specialization momentum,” Carey said. “Globally, 172 specializations have been achieved across 90 partners. The majority have two, and some of the top partners already have all four, even the newest one announced at Synergy.”

Compugen, for instance, has all four specializations, as well as having completed the practicum, and three customer validations.

“They have made a real investment,” Carey said.

“In addition Quebec-based Virtuel TI, which is an entry level partner, not even gold, have specializations in virtualization, networking apps and mobile security, and mobility. This is what we wanted to see, partners with a consulting focus who aren’t focused on resale, but who do this for differentiation in the market.”

Carey said the data on partners who have started the process to get a certification is also positive.

“We are tracking over 1000 of our CSA partners who are taking concrete steps to get specializations, which includes 350 in the U.S. and 50 in Canada,” he said.

Citrix is committed to expand their partner bookings by 15 per cent year over year, over each of the next three years.

“We are just seeing the first results now, even though we have a backended year,” Carey said. “We are seeing a definite spike in partner revenue two months after achieving a certification and then a further spike 1-2 months after achieving a specialization. Our enterprise sales reorganization in North America has also brought new momentum to the channel. We are seeing improved collaboration, and are focusing very heavily on execution.

Carey said Citrix is on track to achieve its channel objectives for the year.

“The second half of the year is critical,” he said. “We need to keep momentum out there and avoid distractions.”