HR Shiever has great expectations from the Indian market. He is well aware that the Application Service Provider (ASP) model did not fare well here when it was introduced five years ago. But he blames it on the hype that was created around this model, which led to higher expectations and therefore a sense of failure. Underlining that Citrix Online's products are online services given on an annual subscription, he is confident that it will appeal to corporate customers, enabling partners to make a good margin selling it.

How is the APac business doing?
The APac division of Citrix Online is a new one. As it is, Citrix Online itself is a relatively new entity. It started out in 1997 as Expertcity in Santa Barbara, Calif. Two years ago, Citrix paid $225 million for the company in a cash-and-stock deal.

We are focusing on good growth though in this region as we see a growing demand for online web tools which will enhance business productivity. This is especially true for the Indian subcontinent, where we have already tied up with several large corporates.

What is your division's revenue contribution to Citrix Systems in the last quarter?
In less than two years since we started operations, Citrix Online is contributed almost 11% to the overall Citrix Systems revenues. And this is significant because we grew our business by almost 60% over 2004. So you can see that we are heading in the right direction.

What are your plans for the Indian marketplace? 
When we started working in APac, I was not sure our value proposition would work in the Indian context. But now I am glad to say that our products have seen a very good adoption in the market. In India specifically, we see a lot of customers are already aware of our products, which makes it easier for us to sell to them. In this country, we started small with just a few people. We wanted to establish our base in the market before we started making investments, which we have now begun. As of now, we are upping the ante for lead generation activities on a war footing.

What channel strategy have you adopted to take your products to your customers?
Citrix Online sells its products on a subscription basis. This means that all of our products-GoToMyPc, GoToAssist and GoToMeeting-are available on an annual contract. So our go-to-market strategy is far different from those of other software vendors.

We have a hybrid channel model. We sell some of our packages online, which make sense since our portfolio consists of online web tools. But a bulk of our business comes from our channel partners.

In India, we are currently partnering with Citrix Solutions Advisors (CSA). These are the people who are offering other Citrix solutions and club our offerings with it.

We are working on launching a program wherein partners who generate leads will be given a commission for the referral. We know that a lot of partners who might not be part of our fold still cater to our target customers. So all they have to do is give us a lead about prospective customers and our team will meet the client. If the deal is finalized, the partner gets an incentive.

Will this margin be the same that you are offering to your CSA partners?
Currently, we offer our CSA channel an upfront margin of 25% on every new deal and 10% for contract renewals. However, the same margins will not be provided to partners who provide us with referral sales. These margins are for those customers who sell our end-to-end comprehensive solutions. We are working out the margins for those partners who will simply be giving us the leads for prospective customers.

What are your target customer segments in India?
In India, Citrix Online is primarily focused on the ITES segment. This is because call centers and business process outsourcing deals with providing real-time assistance to customers globally. By using GoToAssist, these companies can service their clients promptly using just a desktop and Internet connection.

In fact, our applications can run on a dial-up connection as well, which is another boon for customers, though the performance is obviously not as good as that of a broadband. This will come in handy for those clients how might be based in remote locations, where the Net connectivity is poor.

We are also keen to enter the government and educational segments, and are looking for partners who can help it make a breakthrough there. At the moment our go-to-market model comprises several solution providers like Frontier Business Systems, Orient Technologies, Veeras Infotek etc and we are talking to some of these partners to take our products to government and educational customers.

VINITA BHATIA
(vinitavs@cybermedia.co.in)

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