Friday, October 18, 2013

Technology Value vs. Perception

When it comes to the world of IT, there are tried and true technologies and those that have yet to peak.  Those around me know that I am a big fan of virtualization, especially when it comes to the desktop.  Since there are so many devices today from which we access information, the concept of working only through desktops or laptops is a dated one.  On any given day I will access information through at least six platforms:
  • iPhone first thing in the morning and throughout the day
  • iPad (same as above)
  • My home PC
  • My work laptop
  • My iPad mini (for casual browsing and reading)
  • My Citrix XenDesktop
I do not want to have a completely different experience on each of the devices.  Yes, I do want some variation but I also want continuity as I move from device to device.  With a nod to VMWare, Microsoft, and a few other bit players I am a big fan of Citrix and their XenDesktop software.  Once implemented in my environment I can move across all my devices and never lose any data or continuity of experience.

Many of you may not know what I'm talking about in relation to Citrix.  Others may just be getting to the point of understanding the virtual desktop (VDI) concept but have not yet been given access to the technology.  In many ways, Citrix and their XenDesktop software, although having been out for over four years, are still on the cutting edge of technology.  Up until recently, Wall Street had rewarded Citrix for it's innovation and great product.  But then, Citrix got ahead of itself.

Just as most people are awakening to the concept of virtualized desktops, Citrix jumped into the arena of mobile device management (MDM).  You might say that they did this in order to jump in front of a new trend, described by the acronym BYOD.  The term BYOD, or "Bring Your Own Device", refers to a trend where businesses allow people to use whatever brand of smartphone, tablet, or device they want.  The company doesn't buy the device or support it, but must connect to it in order to allow the employee to tie into appropriate corporate systems.  In theory,  MDM would allow companies and their IT groups to manage these remote devices and provision applications or any service to them.

There is just one big problem with all of that.  While it sounds really cool in a geekish sort of way, and you can ask Apple or Google how Wall Street rewards innovative/geeky tech, no company is really prepared or ready to use "BYOD/MDM" solutions.  And since they aren't ready, the corporate wallets are staying firming closed.

So why did Citrix jump so far out ahead of it's customers?  Take a look at how their stock was rewarded after they announced their new BYOD solutions (Worx-mobile) this summer:



Wall Street looked at the innovation of Citrx and said, essentially, "These guys are the first to market with an innovative product.  They can't help but make a killing!"

Yet, all of this happened during the third quarter.  Remember that the U.S. economy and thus the stock market run on a quarterly cycle.  When Citrix had to report its earnings at the end of the third quarter, in September, they had to show that no-one was buying their cool new products.  Yes, they were innovative, smart, and ahead of the curve.  But nobody was buying them so the hype that took Citrix's stock from $60/share to $76/share in just two short months fell flat.

Citrix had to tell it's investors last month that all of the positive press had never really translated to any economic benefit.  We can see how their investors and the market responded to that news:




The bottom fell out of the stock in just two weeks.  It is starting to stabilize at this point, but it serves as a lesson to anyone who falls too quickly and deeply in love with a technology.

In order for tech to be valuable, it must actually be useful in a meaningful way to the market for which it's intended to serve.  Don't buy into hype if you're looking for ways to innovate, invest, or improve.  Just because Wall Street and "experts" say something is great doesn't mean it's great for you.

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