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Report2015 Desktops-as-a-Service global market trends2015 Desktops-as-a-Serviceglobal market trends:The service provider perspectiveSurvey uncovers new trends in market growth, vertical markets,and infrastructure adoption from the service providers who aredelivering Desktops-as-a-Service.Today, organizations from small businesses to the largest enterprises are outsourcing ITservices, from software to infrastructure, to the desktop environments on our PCs and mobiledevices. While Software-as-a-Service (SaaS) and Infrastructure-as-a-Service (IaaS) haveevolved into maturing markets worth billions, the market for Desktops-as-a-Service (DaaS) isstill emerging and developing as a market.Customers and hosted service providers want to know: Is the market for DaaS growing? Shouldservice providers specialize in a specific vertical market, or consider introducing services withbroader, but less specialized appeal that compete on price? Are others successfully deliveringservices from the cloud, or is it better for service providers to build their own infrastructure?In Q2 2015, the Citrix Service Provider Center of Excellence conducted a global survey of theseservice providers to gain insights into the evolution of this emerging market, and wherepossible, compare the results with surveys from previous years. The study generated responsesfrom more than 500 Citrix Service Providers located in 40 countries around the world.The survey covered a range of questions, including: What magnitude of revenue growth do service providers anticipate?Which vertical markets are embracing DaaS?Is DaaS demand strongest among small, medium or large organizations?Are service providers building and using their own IT infrastructure to deliver DaaS and towhat degree are they using major cloud IaaS providers? Which hypervisor- or hypervisors - are DaaS providers using?citrix.com1

Report2015 Desktops-as-a-Service global market trendsDo service providers expect DaaS revenue to grow?While Citrix in FY2014 earnings reported 50 percent year-over-year growth in the number ofDaaS seats delivered by Citrix Service Providers*, how many of those providers anticipategrowth in the coming year? The survey asked the following question:What do you anticipate for Daas revenue growth over the next 12 months?52%Anticipate growthbetween 16 - 50 %71%Providers anticipateDaaS revenue growth17%Anticipate growthover 50%Citrix Service Provider Center of Excellence SurveyCopyright 2015 Citrix Systems Inc.The vast majority of respondents – 71 percent – anticipated DaaS revenue growth. In fact,52 percent projecting growth to range between 16 and 50 percent, with 17 percent of therespondents projecting revenue growth to exceed 50 percent.citrix.com2

Report2015 Desktops-as-a-Service global market trends“The Citrix Service Provider program is one of the fastest growing businesses within our cloudportfolio for service providers. We see an expanding growth rate of actually 55% YoY in 2015. Basedon the economic advantages, the acceptance of providing XenApp and XenDesktop as a service atthe customers’ side is increasing as well. Right now there are hundreds of Citrix Service Providers inthe DACH region working with ADN to grow their business.”Udo Schillings, CMO, Advanced Digital Network Distribution GmbH (ADN), Bochum, Germany“We are seeing growing demand from companies wanting their full suite of applications available tothem from any place and from any device, not just their email and a browser. Clients need a greatchoice of next generation services to help their employees be productive and mobile, while keepingtheir data secure. We are providing a wide range of outsourced IT Services to thousands ofcustomers and we leverage Citrix technology at the heart of our cloud portfolio. Citrix providesgreat tools for us to deliver these kinds of services.”Nick Pegley, VP of Marketing, All Covered, IT Services from Konica Minolta, Ramsey, New Jersey, USA“The customer demand for the always on, always available, always secure working environment issteadily growing. And when an end user experiences the ease of taking her desktop and appswherever she goes, executive leadership takes notice especially as it relates to productivityincreases and competitive advantages. In 2016, mindSHIFT expects to see more opportunitiesfor bundling with our mobility offerings.”Archie Seale, VP of Product and Marketing, mindSHIFT, Sterling, Virginia, USAWhich vertical markets use DaaS?As the 2014 DaaS Market Report indicated, many service providers are avoiding offeringcommodity desktops, in favor of offering business-ready services which are optimized for specificvertical markets. This specialization allows them to provide higher-value services to theircustomers, increase customer loyalty, and increase their margins.“Providing technology solutions to CPA firms is challenging. Public accounting has a complicatedworkflow and is subject to tax laws that are constantly changing. A typical company might use 60different applications that require specialized backends and database servers. A commoditizedapproach isn’t the answer.”Roy Keely, VP of Market Strategy, Xcentric, Atlanta, Georgia, USAcitrix.com3

Report2015 Desktops-as-a-Service global market trendsTo determine which vertical markets are embracing DaaS and hosted workspaces, the surveyasked respondents to:Please select your primary vertical specialty and any other vertical specialties.9%Construction /Architecture /Engineering11%FinancialServices9%Legal9%Public care9%Education6%OtherCitrix Service Provider Center of Excellence SurveyCopyright 2015 Citrix Systems Inc.“Focusing on a specific vertical market allows us to become the experts in our vertical andtherefore bring greater value to our clients than a non-specialized alternative provider. Beingvalued higher creates better customer loyalty and better value also relates to higher revenue.”Byron Patrick, CEO, Simplified Innovations, Baltimore, Maryland, USAThe largest number of service providers who responded listed manufacturing, financial services,retail, healthcare, legal and government as the vertical markets they served. While no onevertical market dominated, one sector that stood out compared to previous surveys wasmanufacturing, which was positioned fifth in the 2011 survey, was ranked third in the 2014survey and rose to the top in the 2015 responses. The growth of manufacturing as a DaaSvertical is a keen indicator of new trends in the vertical market ranking, which is usually dominatedby healthcare and financial services.citrix.com4

Report2015 Desktops-as-a-Service global market trendsYet along with manufacturing, additional verticals gained ground relative to the strong DaaSvertical markets in previous surveys. The sectors showing the strongest relative growthincluded retail, construction, and agriculture. Considering the relatively early stages of the DaaSmarket overall, this broadening of target vertical markets may indicate that providers arematuring in their ability to specialize in new markets, where they may face minimal competition.Driving growth with diverse hosted workspace offeringsService providers are looking to expand beyond the services they offered just one or twoyears ago. The 2015 survey saw continued trends toward growth in hosted mobility, hostedmulti-tenant file share and sync and an interest in offering networking as part of a hostedservice. Consulting and professional services around hosted offerings is also a strong trend.More and more, service providers are reporting demand for a complete Desktops-as-a-Serviceapproach- a workspace that includes apps, desktops, file sharing and mobility.“In a world where our office is increasingly the one square meter around our body, a shift inlanguage and mindset from Desktop to Workspace is a critical factor in delivering differentiatedservices. Successful partners are taking a whole of business approach that addresses both thetechnology and wider business outcomes. It is conversations about ‘Business Continuity versusbackup’, ‘IP protection versus end point security’ or ‘Enterprise device management versus PCsupport’. They are also focused on the needs of the individual role within the context of anindustry vertical.Stephen Parker, VP Market Research, rhipe, Melbourne, Victoria, AustraliaA notable response was the continued success of hosting applications. Some service providershost apps delivered to diverse devices. Other service providers align with ISVs to provideas-a-Service capabilities through Citrix hosted offerings. In other cases, ISVs like CarestreamDental function as the service provider working with Citrix hosting technologies to providethe as-as-Service opportunity to their subscribers.citrix.com5

Report2015 Desktops-as-a-Service global market trends“At Carestream Dental, we provide industry-leading practice management software and imagingequipment that help oral health professionals achieve the best possible patient outcomes. We usethe Citrix platform to offer a suite of hosted practice management software. Knowing that manyof our customers are dental practices with fewer than 20 total staff members, offering a servicethat alleviates much of the IT infrastructure worry from the practice is extremely valuable. Overthe course of the year, a dental practice could save days’ worth of time normally spent managingtheir own IT; that saved time can instead be spent with their patients providing better care.Using Citrix as the backbone of our cloud software solution provides us with a rock solidinfrastructure and deployment method, making it easy to manage thousands of users at anygiven time. The service integrates well within our tier four datacenter and provides us multipletools to easily spin up servers for new customers and run updates to existing customers as needed.”Matt Ackerman, Senior Product Line Manager, Carestream Dental, Atlanta, Georgia, USASome Citrix Service Providers see opportunity in hosting apps that can be delivered to a variety ofmobile devices , so people can access their apps on their preferred smartphone or tablet.“As users have become more comfortable navigating to the apps they want on their variousmobile devices, they are looking for that same type of user experience in their hostedenvironment. TekLinks is seeing that customers are now wanting us to host their app and streamthat to their device of choice. Hosting applications allows us to utilize our resources moreefficiently, license software more accurately, and drive the experience the customer needs. Noneof this would be possible without our relationship with Citrix and the robust tools they provide usto deliver solutions that meet the customer’s requests.”David Powell, Vice President of Managed and Cloud Services, TekLinks, Birmingham, Alabama, USAA secure, consistent and high-quality experience was reported as a benefit for service providers,whether delivering hosted applications or a complete workspace.“Building designers and engineers are under pressure to reduce costs and make their workers moreefficient. As such the workers are demanding a more flexible approach to how, where and whenthey work. Desktops-as-a-Service now enables their 3D design and building managementapplications to be accessible in real-time in any worldwide location. At the same time, it addressesissues such as version control, IP leakage, time lost due to transfer of large files and team scalingincluding external resources.”Dan Wright, Managing Director, Regional IT, Newcastle, New South Wales, Australiacitrix.com6

Report2015 Desktops-as-a-Service global market trendsIn the next 12 months, what service(s) are you planning to add in order to growyour business?49% Desktops-as-a-Service model34% Mobile device management31% Professional services29% File share and sync22% Cloud VDI17% Hosted mail services17% Hosted document collaboration and storage services16% A single hosted application15% Networking as a serviceCitrix Service Provider Center of Excellence SurveyCopyright 2015 Citrix Systems Inc.Also notable is the addition of networking as a service – an area that service providers arerapidly exploring today and a number that may grow in future surveys.“Our success in hosted apps and desktops continues to out-pace our former lines of business. Akey differentiator to success is the addition of networking solutions to our expanded offering –giving customers the flexibility and security required in today’s cloud solutions market.”Paul Kunze, Vice President, Sales and Marketing, IntraSystems, Braintree, Massachusetts, USAWhich infrastructure model and hypervisors and infrastructure vendors are preferredby DaaS providers?Clearly DaaS subscribers are embracing the concept of outsourcing applications and desktopmanagement and delivery rather than managing it in-house. But are DaaS service providersoutsourcing IT infrastructure, or are they building and maintaining their own on-premises?Based on the continued growth of public cloud Infrastructure-as-a-Service (IaaS), are serviceproviders embracing (IaaS) as an infrastructure?citrix.com7

Report2015 Desktops-as-a-Service global market trendsTo clarify current infrastructure trends among service providers, the survey asked:What infrastructure model do you use or plan to use to deliver services?2014-2015 Your own datacenter/co-located datacenter80%61%IN 12 MONTHS79%50%2014TODAYIN 12 MONTHS2014-2015 Public cloud Infrastructure-as-a-Service (laaS)20%201439%IN 12 MONTHS21%TODAY50%IN 12 MONTHSCitrix Service Provider Center of Excellence SurveyCopyright 2015 Citrix Systems Inc.When comparing the current deployments between 2014 and 2015, the overwhelmingmajority currently use either their own datacenters or co-located datacenter facilities to deliverDaaS and other services, though some providers either use or plan to use public cloud IaaS.Yet the responses for what service providers plan in 12 months show a definite trend towardshifting to a cloud-based infrastructure. In 2014, respondents indicated plans to begin a shiftto cloud IaaS, and the 2015 results demonstrate even more optimism toward a move to cloudbased resources.At the same time, it is clear that the anticipated move to the cloud has been delayed at best,and those findings speak to caution on the part of service providers, and the potential thatcloud migrations are not moving as quickly as anticipated. Yet the trend clearly indicates a shiftin the service provider mindset toward embracing IaaS.“The flexibility offered by public cloud services is legitimately unparalleled: businesses large, small,and growing can now scale their IT to their precise operational needs – and if these change at amoment’s notice, they can scale it upwards or downwards accordingly at minimal cost. That’swhy at iFollowOffice, we are able to offer the most cost effective cloud desktops on the market.In the last few years, public cloud has over delivered on its early promise; public perception needsto catch up with it because it is revolutionising the way we work.”Chris Coupe, Business Development Director, iFollowOffice, London, UKcitrix.com8

Report2015 Desktops-as-a-Service global market trendsBecause previous surveys had indicated that service providers used more than one hypervisor,as well as other IT infrastructure hardware and software, the 2015 questionnaire askedrespondents which hypervisor they used, along with their preferred vendor for other coreelements related to delivering Desktops-as-a-Service, leading to the following question thathad appeared in the 2014 survey.Which hypervisor do you primarily use?66%19%of respondents useof respondents useVMwareMicrosoft Hyper-V13%3%of respondents useof respondents useXenServerOtherCitrix Service Provider Center of Excellence SurveyCopyright 2015 Citrix Systems Inc.More than half of respondents – 66 percent - use VMware ESX, while 19 percent use MicrosoftHyper-V and 13 percent use XenServer as their hypervisor. In addition, a few respondentsmentioned other hypervisors, including Red Hat Enterprise Hypervisor and Open Source Xen.While the VMware hypervisor remains popular, it is noteworthy that service providers areexploring other hypervisor options, elevating the importance of allowing service providers tochoose the infrastructure and hypervisor that best suits the needs of their customized,business-ready DaaS offerings.Service providers who use their own datacenter or co-located IT infrastructure also used arange of technology vendors for network hardware, computing and storage. Respondentshighlighted networking infrastructure from Cisco, HP and Dell, along with servers from Cisco,Dell, HP and IBM. Storage infrastructure vendors mentioned included EMC, HP, NetApp, IBM,Dell and Cisco.citrix.com9

Report2015 Desktops-as-a-Service global market trendsA look ahead at the worldwide DaaS marketLooking at the service provider ecosystem, a number of trends can be concluded and implied: Global appeal: The fact that survey respondents hailed from 40 countries illustrates how DaaShas become a global market. Healthy optimism for the growth potential of the DaaS market: The survey showed a strongmajority of service providers anticipate strong DaaS market growth over the next12 months. Vertical market appeal: DaaS has ever-growing appeal to a broad range of vertical markets.Compared to the previous year, service providers expanded the list of vertical market specialties.While the survey respondents specialize in markets ranging from healthcare to manufacturingto financial services to construction, most specialize in their respective vertical markets to limitcompetition and preserve their unique value and margins. Importance of infrastructure choice: From an infrastructure perspective, DaaS providerscurrently prefer delivering DaaS from their own datacenters or co-location facilities,where they have the greatest control over the infrastructure. Yet a significant percentageof providers were clearly planning to shift to cloud-based infrastructure in the next 12 months,indicating a strong trend towards the cloud that is in the early stages. At thesame time, DaaS service providers prefer to choose their hypervisor, with no singlebrand dominating.Based on the survey responses, the news regarding growth in the Desktops-as-a-Service marketis backed by service providers who see potential revenues rising. As the year continues, newprojections will emerge. Continued measurement of the Desktops-as-a-Service industry – and theservices provided in the hosting arena – will show which predictions are most on the mark.iCitrix FY 2014 Earnings: 50 percent year over year growth in the subscription business.Corporate HeadquartersFort Lauderdale, FL, USAIndia Development CenterBangalore, IndiaLatin America HeadquartersCoral Gables, FL, USASilicon Valley HeadquartersSanta Clara, CA, USAOnline Division HeadquartersSanta Barbara, CA, USAUK Development CenterChalfont, United KingdomEMEA HeadquartersSchaffhausen, SwitzerlandPacific HeadquartersHong Kong, ChinaAbout CitrixCitrix (NASDAQ:CTXS) is leading the transition to software-defining the workplace, uniting virtualization, mobility management,networking and SaaS solutions to enable new ways for businesses and people to work better. Citrix solutions power business mobilitythrough secure, mobile workspaces that provide people with instant access to apps, desktops, data and communications on anydevice, over any network and cloud. With annual revenue in 2014 of 3.14 billion, Citrix solutions are in use at more than 330,000organizations and by over 100 million users globally. Learn more at http://www.citrix.com/.Copyright 2015 Citrix Systems, Inc. All rights reserved. Citrix and XenServer is a trademark of Citrix Systems, Inc. and/or one of itssubsidiaries, and may be registered in the U.S. and other countries. Other product and company names mentioned herein may betrademarks of their respective companies.citrix.com1015/PDF/1039910

the DACH region working with ADN to grow their business." Udo Schillings, CMO, Advanced Digital Network Distribution GmbH (ADN), Bochum, Germany "We are seeing growing demand from companies wanting their full suite of applications available to them from any place and from any device, not just their email and a browser. Clients need a great