Citrix buys stake in virtual desktopper

Citrix Systems has just bought a little insurance in its ongoing battle against VMware and others over virtualizing corporate desktops by investing in a startup called Kaviza.

The economic meltdown and the transition to Windows 7 on the desktop have all vendors of virtual desktop infrastructure (VDI) products all rubbing their hands gleefully together in anticipation of a shift by many companies away from desktops with dedicated operating systems toward virtualized desktops that are spun up in the data center and served over the network.

Citrix gets most of its revenue from virtualized applications streamed used its XenApp (formerly Presentation Server) middleware. It has been jiggering and rejiggering its product lines since the acquisition of XenSource two and a half years ago, and lately, it has been mashing up all of its virtual application and virtual machine technologies to allow companies to virtualized applications in a number of different ways, from streaming apps from central servers to hosting them inside VMs with whole operating systems that are managed centrally. But even though the cost of these various products has come down and virtualization has got more efficient (and therefore requiring less iron), for many small and medium businesses, the XenDesktop/XenApp combination and the alternative VMware View are simply too expensive.

Which is why Kumar Goswami, the chief executive officer at Kaviza, and his partner and company software architect, Michael Peercy, started a firm aimed at making a simpler and less costly VDI solution in January 2009. Version 1.0 of the company's VDI-in-a-box package shipped in early 2009, with version 2.0 shipping in October 2009.

Both Goswami and Peercy got their PhD degrees from the University of Illinois with a specialty in distributed fault tolerant computer design. Both have had a number of jobs, but Goswami was a director at HP Labs in charge of data center automation and VDI products, and he wrestled with the complexity and cost issues there when he led a team that created something very much like VMware View for HP five years ago, which incidentally was sold to a number of financial services companies.

Kaviza has been self-funded with the exception of a National Science Foundation grant that is potentially worth a couple of million dollars if all the stages are met, according to Goswami. When he and Peercy shopped around for some Series A funding to push Kaviza up to the next level, Citrix snapped up the whole round. The amount of the funding has not been disclosed, but Citrix has a seat on the Kaviza board and is privy to what a competitor in the VDI space is up to. And it has put a down payment on a potential acquisition if what Kaviza has created takes off among the SMB space it targets.

According to Krishna Subramanian, chief operating officer and vice president of marketing at Kaviza, the experience at HP Labs taught the company's founders that desktops and servers not only could be, but should be virtualized differently. So VDI-in-a-box crams everything you need into a virtual appliance called kMGR, allowing for multiple and cheap servers to be networked together for VDI scalability - but it uses local storage on the servers to host the PC images instead of expensive storage area network.

<p.This is important, says Subramanian, because the SAN can account for anywhere from 40 to 50 per cent of the cost of a VDI setup and it is this cost, as well as the front-end cost of all those shiny new servers to support VDI, that puts the kibosh on VDI projects. The Kaviza approach also does not need connection brokers, load balancers, and management servers, like other VDI setups often require. All that you need to link a thin client or PC that is hosting a virtual desktop is in the kMGR virtual appliance, which creates virtual shared storage for the VDI broker to use as it serves up PC images. That appliance can run on any bare metal x64 hypervisor, but it has only been certified on VMware's ESX Server at the moment. XenServer and Hyper-V will be certified in short order. (You'd think with Citrix paying some of the bills, XenServer will be next).

The net result is that Kaviza can create a virtual desktop image for about $300 using two-socket workhorse servers, and if you toss in a thin client, it costs between $500 and $600 per seat. She reckons that Citrix XenDesktop and VMware View end up costing between $1,200 and $2,000 a seat once all the costs for hardware and software are added up.

Kaviza recommends that on a two-socket Xeon server, companies can get from six to eight desktops per processor core using VDI-in-a-box. It takes around 512 MB of main memory per Windows XP image and about 1.5 GB for a Windows 7 image. ®