Citrix 2009 Annual Report Download - page 34

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expenses defending against such allegations. If our defenses were not successful, we could be subject to
significant damages, enjoined from the distribution of our products that contained the open source software, and
required to comply with the foregoing conditions, which could disrupt the distribution and sale of some of our
products. In addition, if we combine our proprietary software with open source software in a certain manner,
under some open source licenses we could be required to release the source code of our proprietary software,
which could substantially help our competitors develop products that are similar to or better than ours.
In addition to risks related to license requirements, usage of open source software can lead to greater risks
than use of third-party commercial software, as open source licensors generally do not provide warranties or
assurance of title or controls on the origin of the software.
If open source software programmers, many of whom we do not employ, do not continue to develop and
enhance the open source Xen hypervisor, we may be unable to develop new XenServer products, adequately
enhance our existing XenServer products or meet customer requirements for innovation, quality and price of
these Xen products.
We rely to a significant degree on an informal community of independent open source software
programmers to develop and enhance the Xen hypervisor. A relatively small group of software engineers, many
of whom are not employed by us, are primarily responsible for the development and evolution of the Xen
hypervisor, which is the heart of the XenServer virtualization product. If these programmers fail to adequately
further develop and enhance open source technologies, we would have to rely on other parties to develop and
enhance the Xen hypervisor or we would need to develop and enhance the Xen hypervisor with our own
resources. We cannot predict whether further developments and enhancements to these technologies would be
available from reliable alternative sources. In either event, our development expenses could be increased and our
product release and upgrade schedules could be delayed. Moreover, if third-party software programmers fail to
adequately further develop and enhance the Xen hypervisor, the development and adoption of this virtual server
technology could be stifled and our products, including XenServer, could become less competitive. Delays in
developing, completing or shipping new or enhanced products could result in delayed or reduced revenue for
those products and could also adversely affect customer acceptance of those offerings.
We are subject to risks associated with our strategic and technology relationships.
Our business depends on strategic and technology relationships. We cannot assure you that those
relationships will continue in the future.
We rely on strategic or technology relationships with companies such as Microsoft, Wyse Technologies,
Dell, Hewlett-Packard Company, Fujitsu Limited and others. We depend on the entities with which we have
strategic or technology relationships to successfully test our products, to incorporate our technology into their
products and to market and sell those products. We cannot assure you that we will be able to maintain our current
strategic and technology relationships or to develop additional strategic and technology relationships. If any
entities in which we have a strategic or technology relationship are unable to incorporate our technology into
their products or to market or sell those products, our business, results of operations and financial condition could
be materially adversely affected.
If we lose access to third-party licenses, releases of our products could be delayed.
We believe that we will continue to rely, in part, on third-party licenses to enhance and differentiate our
products. Third-party licensing arrangements are subject to a number of risks and uncertainties, including:
• undetected errors or unauthorized use of another person’s code in the third party’s software;
• disagreement over the scope of the license and other key terms, such as royalties payable;
• infringement actions brought by third-party licensees; and
• termination or expiration of the license.
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