Last week virtualization.info reported about an analysis released in June by Goldman Sachs which forecasted a neat leadership of Citrix over VMware in the desktop virtualization market by 2013. Apparently Goldman Sachs is not the only one to believe so. Even earlier than that, at the end of May, in its own intelligence report Morgan Stanley forecasted the desktop virtualization market revenue at $1.5B by 2014 and the market share breakdown in this way: We identify large enterprises, govt, and education as the target segments, leaving SMB penetration as upside, and est. penetration of ~13% (47M PCs) to be virtualized by 2014, out of an estimated total installed base of 370M. We assume pricing declines 8%/year and that VMW and CTXS maintain 80% share through 2014. … we believe CTXS will likely hold the lion’s share of the market at 48% in 2014 vs. 36% for VMW. This implies a $735M rev. opportunity for CTXS in 2014, and $300-500M of potential rev. upside over the next 4 years. … we believe VMW’s View product is evolving and the gap with XenDesktop will close over time. While some of the desktop rev. is in CTXS cons., and cannibalizes XenApp, it’s largely accretive to VMW, and could add $1B to $1.5B to cons. over the next 4 years. The two reports are surprisingly similar in terms of market share. This means that while VMware is a recognized leader in the server virtualization market, well ahead of competition says Gartner , it can’t persuade investment firms about its capability to execute in the desktop virtualization space. The events of the last months didn’t help the company to change this perception: VMware delayed its client hypervisor, Client Virtualization Platform (CVP), several times at the point that the project seems indefinitely postponed now ; its Desktop Business Unit  lost the Vice President and General Manager, Jocelyn Goldfein; and the company’s top executives suddenly are very skeptic about the future of VDI , to the point that they can’t forecast the adoption rate by the end of 2011. Labels: Citrix , VDI , VMware

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Despite the great Q2 performance reported two days ago by VMware, not everybody believes that the virtualization vendor will continue to keep its leadership position in every market segment the near future. Dow Jones in fact reports about a research note released last month by Goldman Sachs about VDI suggesting that Citrix will surpass VMware and lead the market in the next three years. The financial firm wrote in the Americas Morning Summary of June 9 : We believe Citrix and VMware will dominate the VDI market for the foreseeable future, with close to 90% of the market between the two. However, momentum is diverging currently in favor of Citrix. Hence, we have updated our model to reflect increasing market share for Citrix increasing from 42% in CY2009 to 50% in CY2013. VMware’s share moves from 51% to 39% over the same timeframe. Previously we had both vendors with equal share in CY2013. The skepticism expressed by the VMware’s executives during the Q2 2010 earnings call certainly didn’t help to counter the Goldman Sachs forecast. Labels: Citrix , VMware

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Just in case the entrance in the server market and the alliance with EMC and VMware were not clear enough, Cisco decided to clarify even better that taking over HP market share is the primary goal: And it’s not a secret that EMC and HP compete in the enterprise storage space. The only problem is that HP is one of the strongest VMware partner today. The two could move from partnership to fair “co-opetition”, as the Industry likes to call it today, but for how much time?

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