APPLICATION SERVER MARKET BACKGROUNDER Corporate America, in downsizing its mission-critical applications from centralized mainframes to distributed PC-LANs, faces the challenge of unifying its heterogeneous installed systems into a cohesive internetworked solution. Today's rightsizing trend leverages information resources throughout an organization to enhance information availability, regardless of where it may reside, or where it may be accessed, across the enterprise. However, several problems are associated with distributed LAN-based sys tems. First, remote sites and mobile PC users are cut off from critical network applications and data. Second, the LAN topology promotes the wide distribution of applications and data, making information systems difficult to manage and reducing overall securit y. Third, the large installed base of low-end personal computers makes it difficult to rapidly deploy sophisticated Windows applications. Application Servers provide the security, scalability, and management tools necessary to support mission-critical applications in Corporate America's expanding enterprise network environment. File servers emerged to provide centralized file and directory resources for network users, and print servers evolved to provide shared printing resources. Likewise, Application Servers will become a vital network element, offering shared processing power for Windows, DOS and OS/2 applications. Application Servers will become the way to efficiently distribute application power to a diverse workstation and mobile user population. As a result, the network Application Server is expected to be one of the fastest growing segments of the enterprise network computing market over the next five years. Currently, Novell and Citrix combined account for 90 percent of the installed base of A pplication Servers. By assuming responsibility for Novell's NetWare Access Services (NAS) software, Citrix becomes the leading worldwide Application Server provider. Application Servers Defined Complementing the existing local area network (LAN) infrastructure, Application Servers distribute program execution and operation among multiple computers in a network environment. In their simplest form, Application Servers address both the communication and application needs of remote/mobile LAN users. In their more advanced configurations, Application Servers facilitate the development, deployment and management of modern appli ations, and provide the flexibility and functionality to meet a whole host of other PC LAN problems. For instance, it is a cost-effective remote computing solution, providing multiple users with high-performance remote access to Windows, DOS, and OS/2 ap plications. Another common use of Application Server software is for linking remote sites to the corporate WAN. This dramatically improves response time and lessens user frustration over wide-area network bottlenecks. Application Servers offer the advant age of client/server technology, without the need to rewrite existing applications or the need to upgrade the installed client base. Still another use for Application Server technology is in protecting the current hardware investment in PCs and terminals , while giving them the full power of modern Windows applications. Industry Trends for an Emerging Application Server Market Corporate America Downsizes Mainframes performed almost half of all corporate processing activities in 1991, while PC-LANs managed a marginal one-fifth. One year later, mainframe corporate processing declined to 36 percent, while PC-LANs increased its share to almost one-third (Sen try Market Research Software Market Survey). By the end of this year, Sentry Market Research predicts PCs will gain the lead in corporate processing functions. According to a recent Gallup poll, the average Fortune 1,000 company has moved 10 applications from mainframe computers to networked workstations in the past 12 months. The Appeal of Client/Server Computing Sentry Market Research attributes strong software industry growth to the appeal of client/server computing. "Leading the way in potential growth opportunities are client/server-oriented database and systems management tools," claims the Software Executive ). Approximately 9.3 million personal computers are connected to networks that run client/server applications today, and this number is projected to reach 31 million by 1996. While the promises of client/server computing are compelling, the realities of implementation are burdensome. A 1993 Sentry Market Research study revealed that 70 percent of survey respondents cited new client equipment costs (486 system or higher) as an obstacle in implementing a client/server solution. Almost 60 percent said application conversion costs (applications must be rewritten) was a major obstacle, while almost 40 percent said security concerns impeded implementation. Application Servers are based on a form of client/server computing, called Distributed Presentation Management (DPM). Under a system employing DPM, application execution occurs on the Application Server, while only the user interface is displayed on inte lligent client workstations. Downsized mission-critical applications as well as off-the-shelf, industry-standard PC applications can benefit from this execution distribution without any modification. Since application usage and execution are distributed between a client and server, Application Servers provide many of the benefits of client/server programming. The advantage is that the distribution is accomplished using traditional applications without a single line of code or binary image change. And th e need to upgrade the existing workstation hardware base is eliminated. Networking the Enterprise Peripheral Strategies, Inc. describes today's enterprise networking trend, "Clients are attached to LANs, forming the workgroup. LANs are interconnected into networks. Today, the definition of a network is still a 'site.' As WANs, MANs and communications technologies grow, the definition changes. Networks will bridge multiple sites and the enterprise becomes synonymous with the network." Over one-third U.S. companies migrated from departmental computing to workgroup or enterprise-wide computing in 1990. By the end of 1992, almost two-thirds of U.S. companies began interconnecting their local area networks (Telecommunications, July 20, 1992). By adding a WinView Application Server to a wide-area network, the amount of data traveling across the WAN can be significantly reduced. Applications execute locally on the central corporate network, while only keystrokes, Windows graphics commands and m ouse updates travel between the client and server. As a result, WAN bottlenecks are eliminated. Some Citrix customers have experienced overall WAN performance improvements of over 300 percent. Curtailing Software Support Costs Most LANs have been constructed in an ad-hoc manner, desk-by-desk and department-by-department. The uncontrolled acquisition of heterogeneous PCs and LANs often proves difficult to manage when interlinked into an enterprise network system. At the same ti me, the cost of installing and supporting software throughout an organization has become expensive. In fact, software distribution and installation alone constitute an estimated 17 percent of total software costs over a five-year period, according to a recent Gartner Group study. Because of the overhead incurred in software distribution, client softwa e is often frozen at obsolescent release levels, adding additional support burdens. WinView for Networks minimizes the support burden of software installation and distribution since a single application server can support up to ten Windows or 20 DOS users, thereby minimizing the number of execution points. Corporate America on the Go By 1995, 4 million remote users will be connected to corporate LANs according to a recent study by Forrester Research. These mobile and remote computer users will perhaps be one of the greatest contributors to the growth in demand for Application Servers. expected to grow by 225 percent in 1994 to 75,000 mobile users (Yankee Group, March 22, 1993). A recent Gallup poll states that 40 percent of Fortune 1,000 PC users carry notebook computers while traveling on business. These workers need to access a depa rtmental or enterprise network, creating a dial-in server market that will increase by 75 percent in 1993 and 110 percent in 1994, according to Gartner Group. Forrester Research calls this the LAN Outer Network or LON market, where the LAN is extended to remote and mobile users. LON market revenues for products linking mobile users and branch offices to corporate networks are predicted to increase from $529 million in 1993 to $2.8 billion by 1997 according to Forrester Research. According to the U.S. Department of Transportation, two million full-time workers already practice telecommuting at least part of the week, and this number could reach 7.5 million to 15 million people by the end of the decade (Software Industry Report, M ay 24, 1993). An estimated one-third of the American work force currently works from home, and BIS Strategic Decisions says the home office market is expected to reach 42.5 million households by 1995. WinView for Networks provides remote and mobile users with performance comparable to what they would experience if they were running Windows, DOS and OS/2 applications locally. High speed is achieved over low bandwidth connections since only keystrokes, Windows graphics commands and mouse updates travel between the server and client. Hardware Installed Base Demand for Application Servers will also be fueled by corporations that want to deploy Windows applications but want to gain maximum use of their existing hardware base. According to Bernstein Research, there are 39 million 80286 and 37 million 80386-bas ed personal computer systems in operation today. This number will shift to 23 million 80286 and 72 million 80386 systems by 1995. Last year, Windows application sales outpaced DOS sales, growing by 95 percent to $1.93 billion, while DOS application sales declined a full 13 percent to $2.5 billion (Software Industry Report, April 5, 1993). Today, most new software applications require an 80386 processor at a minimum. Next year, the minimum requirements will shift to a 80486 system with the arrival of Win dows NT. Yet, 286-based personal computers still comprise 30 percent of the PC installed base today (Computer Intelligence), and 386SX systems will still constitute one-third of the installed base by 1996, making them incapable of accessing sophisticated Windows applications. WinView's unique distributed Windows architecture (under license from Microsoft) allows remote PCs, even 286 machines not capable of running Windows, to access today's sophisticated Windows applications. The processing power required to run WinView's sma ll client (640KB on a 286 system) is much less than that needed to actually run Windows 3.1. Security is a Top Concern Several events, trends and technological in-roads have combined over the past few years to increase Corporate America's vulnerability to hackers, viruses and other security breaches. A recent survey of computer security professionals conducted by COMSEC, the on-line computer security bulletin board, reveals that two-thirds of the respondents had experienced a security breach within the past year alone; 10 percent further said that these security violations had cost their companies over $100,000. Securit y breaches cost U.S. businesses approximately $4 billion a year. As a result, an astounding 37 million hours or 4,000 years of worker productivity are lost (Information Week, August 3, 1992). Rightfully so, security is cited to be the number one concern of many network administrators (Business Research Group, 1993). As a result, the security marketplace is poised for explosive growth, estimated to reach $4 billion by 1995 (Datapro). WinView offers a fully secure, reliable and manageable remote computing solution to meet the expectations and requirements of even the toughest network administrator or system integrator. It's advanced multi-level security system, including dial-back, pr otects the network while maintaining tight integration with existing NetWare security. With WinView's advanced disconnect recovery feature, disconnected sessions are maintained and password protected, allowing remote users to reconnect from any workstation, and with the proper password, pick up right where they left off. Conclusion The new Application Server market will help drive the growth of networked applications, LAN equipment and remote connectivity products. As the physical boundaries of the networked enterprise are pushed outward, IS managers need to manage distributed appl ications and provide security for sensitive corporate data. In addition, organizations will continue to adopt new computing technologies in an environment that mixes next-generation portable computing devices with an installed base of less powerful compu ters. As more users discover the benefits of Application Server technology, demand will rise exponentially. Citrix Systems, the leader in Application Server technology and installed base of Application Server software, is well positioned to take advantage of t his growth. Citrix Systems fulfills the disparate needs of Corporate America with a comprehensive solution that offers the security, scalability, and management tools necessary to support mission-critical applications in the expanding enterprise network environment. - ### - Citrix and WinView are registered trademarks of Citrix Systems, Inc. All other trademarks and registered trademarks are property of their respective owners. For more information, contact: Vicky Gore Harris Marketing Communications Manager Citrix Systems (305)755-0559 Dave Kitchen Copithorne & Bellows (617)252-0606