Tarantella has announced a key reseller partnership with IBM, as part of the company's effort to recast itself as a viable alternative to Citrix in enterprise data centers that are embracing Linux.
IBM's sales teams, especially those focused on the burgeoning Linux server market, will sell Tarantella's server software, called Secure Global Desktop, to enterprise network executives that want to create secure remote access to applications running on an array of server and host operating systems.
Both Citrix and Tarantella have a broadly similar idea: load your desktop applications on central servers, and run them there, serving the screen displays over wired and wireless links to traditional PC or workstation clients as well as thin clients - handheld devices that access servers applications via a Web browser.
But Tarantella is re-emphasizing its support for non-Microsoft applications, allowing various clients to connect with these legacy applications and to a growing portfolio of programs shifting to Linux servers. Citrix has been improving its ability to access Unix and other applications, through a combination of its own and third-party software.
Tarantella is in effect conceding to Citrix those companies that are mainly based on Microsoft applications and operating systems. Under the company's new strategy, put together over the last 6 to 9 months by a new executive management team, Tarantella will focus on those sites that have a multitude of legacy applications in addition to Microsoft, running on mainframes, Unix servers and, especially in the future, on Linux.
Tarantella was a spinoff of The SCO Group, which acquired the software from a British company in 2000. In 2003, Tarantella acquired another Citrix rival, even smaller than itself, New Moon Systems, with its Canaveral IQ product that focused on Microsoft platforms.
According to current President and CEO Frank Wilde, who joined Tarantella in 2003, his first concerns were not with the software but the company's finances. He says he's worked to restore investor confidence, gotten the publicly held company relisted on the NASDAQ stock exchange, and set the finances on a solid if not yet profitable foundation. He says the company will be profitable in 2005.
For the 2004 fiscal year, which closed in September, Tarantella reported revenue of US$12.5 million and a net loss of US$15.7 million, or 71 cents per share. But those numbers are worse than fiscal 2003, when revenue was US$14 million and the net loss US$9.7 million.
As evidence of improvement Wilde points to the most recent quarters. The fourth quarter revenue was US$3.3 million, up compared to US$2.6 million a year ago. The net loss was US$5.5 million, compared to US$3.7 million a year ago, but the results include a restructuring charge of US$1.6 million, and legal and other one-time charges totaling US$2.2 million.
The second goal was to focus Tarantella on the Linux market, and ally itself with partners that had a similar focus. After months of talks, IBM and Tarantella hammered out a deal whereby the IBM sales force will offer Secure Global Desktop Enterprise Edition as the secure remote access product on IBM's eServer xSeries and BladeCenter servers.
As part of the deal, Tarantella devised a simplified pricing scheme, and one intended to be considerably cheaper than Citrix. Instead of per-user pricing, Secure Global Desktop now is sold via IBM based on, in effect, three classes of servers, handling 200, 400 or 600 users. For 200 users, the price is US$30,000; for 400, US$60,000, for 900, US$90,000.