Insight

Citrix Discontinuing Perpetual Licensing for On-Premises Offerings

Subscriptions are nothing new.

As a matter of fact, Gartner predicted that “by 2020, all new entrants and 80% of historical vendors will offer subscription-based business models.”  It should come as no surprise then that many software vendors have moved in this direction and that you’d be hard pressed to find a business who is not utilizing some form of subscription service.  Think Microsoft 365.

With the advent of Citrix Cloud several years ago, Citrix made software-as-a-service and, consequently, a subscription-based model available.  Transitions to Citrix Cloud and subscription models were massive – 75% of Citrix’s current business is through subscription.  Citrix Cloud provides an amazing platform to ease the burden of management complexity, expedite deployment of services across hybrid environments, and expose organizations to a wealth of value-added features – many of which were not available for traditional on-premises deployments.

Subscription-based solutions provide benefits including lower cost of entry, financing flexibility, simplified billing, and ongoing predictability.  However, for some organizations, especially those that sit within the remaining 25% of Citrix’s business, perpetual seems to be the desired acquisition approach.  Come September 30th, 2020, you’ll need to merge with the subscription model for future licensing acquisition.

End of Availability

On July 1, 2020, Citrix announced that as of September 30th, 2020 they will be discontinuing the ability to purchase Digital Workspace (Workspace, Virtual Apps, Virtual Apps and Desktops, Virtual Desktops, Endpoint Management) perpetual software licenses.  As such, on October 1, 2020, you will only be able to purchase on-premises software solutions as a subscription.

This should be no surprise.  Actually, many organizations have already reaped the benefits of this transition for on-premises deployments.  During March, and in light of the global pandemic, Citrix began offering the subscription for on-premises customers to overcome challenges with spiked remote work demand, especially short-termed subscriptions (i.e. one year).  These organizations were able to maintain their existing perpetual licensing while adding in termed subscription licensing to increase their overall user entitlement.

This transition does not apply to any Citrix Networking perpetual offerings.

What should you do?

Plan ahead.  Understandably, not all organizations are ready to make the transition to subscription services, and Citrix’s end of availability will not impact your existing perpetual licensing, nor your ongoing Customer Success Services agreements.  However, if you expect to increase licensing and wish to remain on a perpetual model, you must acquire new licensing before October 1, 2020.

Transition.  We are extremely fond of the capabilities of Citrix Cloud – it dramatically simplifies Citrix governance and expedites innovation.  If you are a traditional on-premises Citrix customer, we highly recommend a transition to Citrix Cloud.  This transition will take your existing perpetual licenses and convert them to a subscription-based model, and we can help – quite quickly – in re-architecting your on-premises environment to function in Citrix Cloud.  Alternatively, and if you’re cloud adverse, we expect Citrix to offer transition solutions to remain on-premises – meaning, your existing perpetual licensing can be converted to subscription while remaining on-premises.

Lastly, as both a Citrix Solution Advisor and Citrix Service Provider, we’re in a unique position to offer immense flexibility on licensing acquisition.  Not only are we able to provide a myriad of options around traditional licensing (between now and September 30th) and subscription, we’re also able to break down license lending to smaller terms, even as short as a month.  This provider model does not work for all customers, nor all deployments, and may not compliment existing licensing approaches; however, for new organizations looking to invest in Citrix or for organizations looking for a more flexible transition away from perpetual, provider licensing may be an area worth exploring.

Do nothing.  If you are happy with your current perpetual licensing and on-premises deployment, you can do absolutely nothing as your existing licensing and support agreements will remain just as they are.  Citrix is not terminating support for on-premises deployments.

Rest Assured

Citrix discontinuing perpetual licensing is not meant to force decisions on current buying considerations.  If you are currently considering a new investment in Citrix technology, September 30th should not be your forced deadline to make a decision.  If you’ve only been exposed to perpetual licensing costs to date, it would be extremely beneficial to also compare subscription options, especially Citrix Cloud as there are potential cost savings to be realized in leveraging this for your delivery strategy.

Citrix’s transition is not an outlier.  As mentioned earlier, many vendors have transitioned to a subscription model and new vendors will likely only ever offer a subscription model.  Subscriptions are becoming the norm and preferred way for enterprise software acquisition.

Next Steps

With any notification that spells the end of something, fear and uncertainty will prevail.  Citrix remains committed to helping customers realize their transformation goals and, importantly, to their Cloud strategy.  As an existing or potential customer, education and awareness is key to understanding the impacts of this announcement and your options moving forward.  In light of this, we invite you to contact us to understand the transition better, discuss actions you should (or should not) take, and explore the value of transitioning to Citrix Cloud.

Chat with Us

Further, we will be holding a webinar around Citrix’s announcement on July 29th, 2020 at 10am EDT.  You may register below.

Register for Webinar

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