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02.20.08

Did Microsoft Hijack XenSource Like It Tries to Hijack Yahoo?

Posted in Deals, Deception, Free/Libre Software, GNU/Linux, Microsoft, Red Hat, Servers, Virtualisation, Xen at 10:32 pm by Dr. Roy Schestowitz

Back to Citrix, ‘aka’ XenSource, formerly Xen (RIP)

As we showed a fortnight ago, Citrix is no longer interested in Xen as a virtualisation technology.

What was XenSource’s bread and butter again? Virtualisation.

How much did Citrix pay for Xen(Source)? Half a billion dollars.

How many customers did XenSource have? Hundreds or a few thousands.

What does Citrix claim it needed XenSource for? The trademark, the name.

Citrix insists that it’s not a virtualisation company and has no intentions of becoming one. So why did Citrix buy a company solely focused on visualisation (and probably overpaid to snatch it)? Most likely: Microsoft.

Microsoft has admittedly fallen behind in hypervisors, which place GNU/Linux well ahead of Windows. Microsoft is still trying to get its hypervisor technology (it actually bought one) to work and it had to drop it from Server 2008 (formerly Longhorn) due to implementation difficulties. Don’t say this to anyone *wink wink*, but Microsoft told its developers that Windows Vista is screwed and that he codebase is apparently a mess.

2 days ago, Mary Jo Foley said that Server 2008 shares a common codebase and even the patches are merely identical, so the first server release (RTM) will be called SP1 (for perception and PR purposes, of course). Will Windows Server 2008 rock? Yes, as much as Windows Vista, with an almost identical DNA. Or as much as the Zune (mind the sarcasm here!).

Anyway, going back to the main point, Xen was a huge threat to Microsoft, not to mention VMWare. Microsoft is at the moment using both of them (there’s a new strategic alliance involving Microsoft and Citrix with Xen), whose clear purpose is to knock down VMWare, on which companies like Red Hat depend. Feel free to browse our “Xen” category if any (or all) of this information is new to you because this was covered extensively before, with quotes and citations to back it. None of this is truly speculative.

Discussing Yahoo would have us pulled off-topic and into territories where there is endless discussion to weigh. It’s a distraction to our focus on Novell and Free software. However, be aware that what you find in Yahoo may be eerily similar to what we saw in XenSource.

Back over two years ago, Microsoft began collaborating with XenSource. They signed some form of a deal when XenSource was still a small company without much at all in terms of funding (KVM probably did not exist at the time).

“It later turned out that XenSource management began to even contain former Microsoft employees. This included a general manager.”XenSource needed some love and support. Shortly afterwards, XenSource opened some form of a branch nowhere other than Redmond, Washington. It later turned out that XenSource management began to even contain former Microsoft employees. This included a general manager. Sounds familiar? We shall discuss this phenomenon shortly on in this Web site when we get around to Nokia’s snub of Free software (teaser: Nokia has Microsoft insiders).

In any event, some months later, despite growth, XenSource pretty much sold out to a Microsoft partner (Citrix). Coincidence? Your call. All we know is that a company which began as an ‘all about open source and Linux’ business ended up in Redmond with Microsoft chums at the top, cheerfully running the the show.

This brings us to yesterday’s news about Microsoft’s proxy fight against Yahoo (we’re watching it very closely but not writing about it).

A word of caution: Don’t accuse us of using ‘conspiracy’ terminology like “proxy”. Don’t blame us. Blame the press. Blame Microsoft. They are the ones describing a hostile takeover in this way. New articles include:

1. A Yahoo Proxy Contest: How Good Are Microsoft’s Chances?

Microsoft refuses to boost its Yahoo bid, valued at $31 a share a few weeks ago. It refuses so thoroughly, in fact, that the Redmond, Wash., software giant may be willing to wage a proxy battle to oust Yahoo’s board, according to this report. (To do that, Microsoft must nominate a new slate of directors for Yahoo within the next three weeks).

2. Microsoft Usually Doesn’t Do This Sort of Thing. Except It Does. All The Time.

When Microsoft proposed its $31 a share takeover of Yahoo, the deal’s rich 61% one-day premium seemed a necessary part of the audacious bid: at a price like that, who could refuse?

3. How Yahoo went from Web star to Microsoft prey

A desperate, expensive bid to beat Google; turf wars among divisions

Putting aside the irresponsible lack of government intervention amid such abuse (Yahoo employees on campus are said to be nervous or absolutely terrified), Microsoft may have used the same tricks against XenSource. It invited the company to reside next to its main headquarters, put some ex-Softies in positions of power and then used the “Citrix proxy” to acquire Xen, escaping the FTC’s scrutiny and the GNU GPL’s obligations by doing so.

Which company will Microsoft ‘steal’ tomorrow? Less importantly, what was behind Sun’s acquisition of Innotek (VirtualBox)? Another attempt to prove that Sun is “sort of a little pregnant with open source” when witness testimonies [cre 2508 suggests otherwise]?

Remember that Steve Ballmer said that he was prepared to buy open source software companies (roughly in October 2007, unless memory betrays here). Microsoft wants to replace LAMP with WAMP, so acquisitions along the way is small money. They are long term investments under the assumption that in a market lacking competition the monopolist sets the price.

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