Citrix 2000 Annual Report Download - page 9

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7
Additional Strategic Relationships. As of December 31, 2000, the Company
has entered into approximately 150 ICA license agreements. Currently, more than
200 different devices incorporate Citrix ICA, ranging from Linux terminals to
information appliances, such as wireless phones and handheld devices. ICA
licensees include IBM, Compaq, Hewlett Packard, Motorola, Samsung, Hitachi and
Sharp, among others.
RESEARCH AND DEVELOPMENT
The Company focuses its research and development efforts on developing new
products and core technologies for its markets and further enhancing the
functionality, reliability, performance and flexibility of existing products.
The Company solicits extensive input concerning product development from users,
both directly and indirectly through its channel partners.
The Company believes that its software development team and core
technologies represent a significant competitive advantage for the Company. The
software development team includes a number of key members from the engineering
team that developed the original version of OS/2 at IBM. This team has been
involved in the development of system software products utilizing Windows NT
technology and UNIX.
During 2000, 1999 and 1998, the Company incurred research and development
expenses of approximately $50.6 million, $37.4 million and $22.9 million,
respectively.
SALES, MARKETING AND SUPPORT
The Company markets its products through multiple indirect channels
worldwide, including distributors, value−added resellers, system integrators and
original equipment manufacturers (OEM) licensees, as well as through a direct
sales force. The Company provides training and certification to integrators,
value−added resellers and consultants for a full−range of MetaFrame−based
application deployment and management solutions and services through its Citrix
Solutions Network(TM) ("CSN") program.
As of December 31, 2000, the Company had relationships with approximately
90 distributors and approximately 7,500 CSN Providers worldwide. A number of the
Company's strategic partners and OEM licensees provide additional indirect sales
channels for the Company's products under either a Citrix brand or private brand
name.
In September 1998, the Company officially launched the Citrix Business
Alliance(TM) ("CBA"), a coalition of industry−leading companies from across the
technology spectrum who work closely with the Company to design and market
complementary solutions for the Company and CBA customers. By the end of 2000,
CBA membership had grown to more than 625 members, including key hardware,
software, global and regional consulting partners. A sampling of the Company's
membership includes Compaq, IBM, Hewlett Packard, Siebel Systems, PeopleSoft,
SAP AG, Computer Associates, BMC Software, JD Edwards and National
Semiconductor.
The Company's sales and marketing organization actively supports its
distributors and resellers. The Company's marketing department provides
training, sales event support, sales collateral, advertising, direct mail and
public relations coverage to its indirect channels to aid in market development
and in attracting new customers. The Company's sales organization consists of
field−based systems sales engineers and corporate sales professionals.
Additional sales personnel, including those based in Fort Lauderdale, Florida;
New York, New York; Atlanta, Georgia; Chicago, Illinois; San Mateo, California;
Toronto, Canada; London, England; Munich, Germany; Schaffhausen, Switzerland;
Paris, France; Amsterdam, Netherlands; Copenhagen, Denmark; Milan, Italy;
Madrid, Spain; Sydney, Australia; Melbourne, Australia; Singapore; Tokyo, Japan;
Hong Kong; Bangalore, India; Sao Paolo, Brazil and Mexico City, Mexico, support
these field personnel. These additional sales personnel recruit prospective
customers, provide technical advice with respect to the Company's products and
work closely with key distributors and resellers of the Company's products. The
Company plans to hire additional direct sales personnel to market its products
to large corporate enterprise accounts.
The Company provides most of its distributors with product return rights
for stock balancing. Stock balancing rights permit distributors to return
products to the Company for credit, within specified limits and
7