2X Software raids Citrix reseller base

Citrix challenger claims disgruntled XenApp resellers are better off punting its low-cost alternative

Citrix challenger 2X Software claims it has recruited nearly 100 UK partners from under the nose of the market's 800lb gorilla this year.

The desktop and application virtualisation vendor has seen its VAR tally swell from 100 to 197 this year.

2X claimed that most of the new recruits have been disgruntled Citrix Silver partners hunting for a lower-cost alternative to XenApp.

Paul Robinson, UK and northern European managing director at 2X, argued that the maths stack up for prospective partners, despite the much lower deal sizes involved.

"On a Citrix deal worth £100,000, the partner's margin is about five per cent," he explained. "An equivalent deal with our licences may be £5,000 and the partner would get 25 per cent margin. Although they would lose margin with us, the customer effectively has another £95,000 to spend [on a complete solution with the reseller]."

Launched in 2005, 2X claims to have more than 18,000 licences in the field and about 3,200 in the UK, generating 95 per cent of its revenue through the channel. Robinson said its licences, which are sold per server, contain all the core functionality that Citrix offers, including load balancing and the ability to publish applications.

Robinson admitted that 2X and other challengers, such as Quest and Ericom, still own less than a combined five per cent of an application publishing market dominated by Citrix.

However, he argued that lower-level Citrix partners can win only by siding with an alternative vendor.

"Silver partners cannot compete because Platinum partners are selling the products at a better price than they can buy them," he said. "The chances of them losing with us are much lower than with Citrix."

2X splits its resellers into Partner, Advanced Partner and Premier Partner tiers, with the associated discount rising from 15 to 30 per cent. He claimed that revenue in his region was tracking 38 per cent of last year on the back of the recruitment drive.

Robinson admitted Citrix partners may want to move over discreetly, for fear of upsetting the market leader.

"We are not asking them to get rid of Citrix but we are asking them to look at us as an alternative," he said.