Cisco could be in the market to replace its current application delivery networking products with Citrix's NetScaler application delivery controllers (ADC), as part of a rumored OEM deal with Citrix that could potentially set the stage for an acquisition, according to an analyst report published this week.
Ittai Kidron, managing director at Oppenheimer & Co., wrote in a note quoted by StreetInsider.com and other news outlets that Cisco is close to an OEM agreement with Citrix for use of its NetScaler ADCs.
Longer-term, Kidron postulates, Cisco could look to acquire the NetScaler assets from Citrix and make itself a more formidable ADN competitor to market leader F5 Networks and other competitors.
[Related: 5 Vendors Exploiting Cisco's ADN Downshift]
"We see little go-to-market conflict as we expect Cisco to focus on standalone solutions while Citrix will focus on bundling with its own solutions," Kidron wrote.
"F5's enterprise/SMB sales could come under pressure and so could Radware's," he added.
Cisco declined comment to CRN, citing a policy of not responding to rumors and speculation.
Cisco last month told CRN that it would cease development of its Application Control Engine (ACE) load balancer products -- an admission many observers took to mean Cisco was pulling back in ADN and Layer 4-7 networking altogether.
Several significant ADN competitors to Cisco, including F5, Radware, Array Networks, A10 Networks and Riverbed, confirmed and updated their Cisco trade-in programs to exploit Cisco's weakness.
Citrix, however, would represent a logical fit for Cisco seeing as it closely partners with Cisco in areas such as virtual desktop infrastructure (VDI) already. Citrix is also the No. 2 market share leader for ADN, with most analysts estimating Citrix at about 15 to 17 percent, ahead of Cisco's comparative 10 to 11 percent though significantly behind F5's roughly 50 percent. Citrix does have a trade-in program for competitive equipment that includes a 10 percent discount on NetScaler equipment, though it has not appeared to market that program specifically against Cisco ACE.
Citrix did not respond to a request for comment by CRN Tuesday.
PUBLISHED OCT. 16, 2012