Parallels CEO Quarles: Citrix Migrations Still ‘Big’ Business For Partners
'If all we do is rip and replace Citrix, yeah, that's interesting. But it's not interesting over time,' Parallels CEO Christa Quarles tells CRN.
Christa Quarles, CEO of Parallels, said that migrations from Citrix, VMware and VMware end-user computing spin-off Omnissa remain “big” opportunities for her company and its solution providers. But she knows customers seeking alternatives to legacy virtualization vendors isn’t a long-term business strategy.
“If all we do is rip and replace Citrix, yeah, that’s interesting. But it's not interesting over time,” Quarles told CRN in an interview. “We have to create a space where that partner knows that they can work with us for a long time, that we’re going to continue to innovate, and the end customer believes that they can work with us for a long time.”
Some of the more recent markets Austin, Texas-based Parallels has invested in for taking share include the secure enterprise browser space with its Parallels Browser Isolation (PBI) offer released last year. In September, its Parallels Desktop 20 for Mac Pro Edition introduced a Linux-based virtual machine meant for developers and students learning to develop machine learning (ML), large language models (LLMs) and computer vision applications.
[RELATED: HPE’s VM Essentials Puts Partners Back In The ‘Virtualization Game’]
Parallels Partner Program
This week, Parallels introduces its new Elevate Now Partner Program. A new “essentials” tier for smaller partners not yet hitting the minimum deal size requirements of the existing “silver,” “gold,” and “platinum” tiers aims to help with solution provider recruitment. A new partner portal, higher discounts, faster onboarding, improved support and free enablement and certification across all tiers are also part of the program.
Mark Vincent, president at XenTegra One–whose parent, Charlotte, N.C.-based XenTegra, is a member of CRN’s 2024 MSP 500–told CRN in an interview that Parallels’ hands-on approach with solution providers have helped the vendor stay out in an increasingly competitive market.
“I have never had better success partnering with a company at the field level,” he said. “Any wild idea I've had to try to do some marketing or some sales attempts, they've been like, ‘Hey, let's do it. Let’s go.’ So awesome.”
Parallels’ PBI product has opened up more sales opportunities for XenTegra One, Vincent said.
“It actually creates a session up in the cloud,” he said. “It’s basically like a Kubernetes instance … It sets up a browser, and you have a lot of controls on it. Once I demo that, and people get that idea in their head, they're like, ‘Oh, wow. That’s really cool. I can literally lock down my sales force so that no one can get into it, no one can exfiltrate data out of it, all that kind of stuff.’”
In an interview with CRN earlier this year, Citrix Co-President Hector Lima said that, along with investments in its partner ecosystem, the vendor is focused “on enterprise customers that are invested in us” and has not seen “a lot of the smaller players coming in and being true competitive threats.”
Quarles also spoke with CRN about customer demand fueling the virtualization space, why Parallels is investing in the channel, and competing with Omnissa, a fellow portfolio company of private equity and investment firm KKR. Answers have been edited for clarity.
We are partner first. We are channel first. Period.
Our ethos shows up in the way we would converse with our partners, the way we listen to our partners. Holding partner advisory boards.
We find out what works, what doesn't, or how can we better support partner goals?
We know our partners have a business model. If perhaps we are running counter to what makes them successful, we ourselves are not going to be as successful. And so with all of the ‘sturm und drang’ (storm and stress) that's going on out there with Citrix and Omnissa (formerly VMware’s end-user computing (EUC) business) … this is people's livelihoods.
It’s how they put dinner on the table at the end of the day. And it’s the disruption, it’s the volatility, it’s the lack of certainty, it's the price changes. All of those things make doing business in this frame hard.
Our goal is to not make it hard–to make it easy and delightful, and to continue to innovate and evolve. And so we look at the brownfield opportunity that Citrix and VMware, to some degree, have opened up. And it's big. But … if all we do is rip and replace Citrix, yeah, that's interesting. But it's not interesting over time
We have to create a space where that partner knows that they can work with us for a long time, that we're going to continue to innovate, and the end customer believes that they can work with us for a long time.
How is Parallels preparing for business in the long run?
If you're a partner who benefited from the complexity that Citrix brought into the market, and all of a sudden we bring a simpler solution, that could be scary.
My value is–I simplify their complex stuff. And so we better create a value offering for that partner that makes them just as critical and just as important to that end customer. Part of that goes into, how do we price? How do we educate? The volume of activity.
We launched Parallels Browser Isolation (PBI, released in 2024). The secure enterprise browser is something at some level every one of these customers needs.
Before we launched Browser Isolation, we had DaaS (desktop-as-a-service) and RAS (remote application server) and PSW (Parallels Secure Workspace)--all of those are effectively deployment choices. And if some of our partners choose to have multiple deployment pathways, that's OK.
But PBI is our first ‘and.’ Buy RAS ‘and’ PBI. It enables a partner to add more things and to become more valuable. We have partnerships with a ControlUp or an IGEL.
We may not be all things to all people, but we partner with the people. We want to make it easier for you to operate and take guesswork out.
Some of these people have been with Citrix for like 14 years. That's scary.
The other thing that we're trying to do is also understand some of the nuances in some of the verticals. Health care has been a huge opportunity for us. If you have your medical records managed through this process, that's important. That's the livelihood of your business. And so you're not going to just transition that over willy-nilly.
But they've done tons of huge medical records deployments with RAS. It’s taking more of the guesswork out of it. That's where we're starting to see it show up in our metrics.
Our sales pipeline last year doubled. Our new deal registrations tripled. We're seeing hyper growth. And there's nothing that suggests that that should slow down.
(Citrix’s agreement to make Arrow Electronics sole distributor in some markets) is yet another, guess what, wake up in the morning, and your business has been disrupted. We just want to be the partner that is here, listens … (is) in a place to win the business and evolve over time with both the partners and the customers.
We want to listen to where the gaps are in the EUC market. And so where do we fill in?
The Azure Virtual Desktop (AVD) side. The financial operations of these things … Azure Virtual Desktop management is something that just is part of RAS. There are other competitors out there who do that exclusively. But we look at it as part of the overall management of the operation.
How do you view Microsoft and its ecosystem?
We’d love to expand the AVD practice within Microsoft. We would never look at Microsoft as a competitor, because that's just dumb.
We all are aware that Microsoft is Microsoft, and they're going to go to 80 percent of what a customer needs. And they have always leaned into either a developer or partner environment to fill in the gaps.
And so it is our job to understand where Microsoft is going, where's their roadmap, make sure that we are in front of them. For example, today, we're still the only licensed solution between Apple and Microsoft for desktop.
We want to be where Microsoft isn't going to be.
We've got to continue to be in the spaces that make sense for partners. And we would love to dive in more aggressively with Microsoft partners to be able to offer some of that.
We recognize we're not going to outpace Microsoft on anything, but we also recognize Microsoft is going to do a thing to a certain level and that they actually expect the ecosystem to sit around them and fill in what they're not going to do at scale.
That's where partners like us or players that sit around the ecosystem can really add value.
Has Parallels for better resilience been a strong talking point with customers?
Resilience is certainly a part of it. When we think about what we do in a nutshell, it's secure application delivery. If it isn't secure, you don't get to play.
What secure has meant, though, has evolved as the security environment has evolved. We've got to continue to stay up pace with what the market's demanding. We even bring our own security team.
We think about the whole system. And the method by which secure application delivery occurs is evolving. We've got to continue to stay in front of it. And we can't maintain the security posture we did five years ago because the world, the threat agents, everything has changed.
As you look at the entire ecosystem, there has been a lot of consolidation. But any operator that sits within the infrastructure stack has to be secure by default, such that you get to play.
If you end up in a place where an IT team doesn't want to adopt you … it's just going to be harder to sell, which means it's harder for the partners.
We need to make our partners’ lives easier, and this is another way.
What’s changing for Parallels in the AI era?
AI at the security level and just what the social engineering opportunities are, where the weak points can be, I feel like it's becoming exponential in terms of threat, response, threat, response.
But I also look at more and more what people are doing locally on the desktop. One of the things that we feel like we're uniquely positioned with Parallels Desktop … is actually working with IT departments to say, how do you want to allow your developers to deploy AI locally? Could you be running an LLM (large-language model) locally?
We've got a solution that we launched in September (Parallels Desktop 20). We're going to continue to iterate on what that looks like.
Even if you think about what a partner does? … DeepSeek and everything that's going on (reevaluating the cost of AI solutions). … The AI activity is going to compound. And if you think about knowledge work broadly defined, anything that a human can do interfacing with a computer can be agent-ified.
How is the partner ecosystem going to be impacted by what an AI can do? Now the question is change management.
You're not going to lose your job to AI, necessarily, but you'll definitely lose your job to somebody who can use AI. And you're starting to see people get 10xed–one person can do the job of 10 people.
People think business process outsourcing is going to go away. And now the number of humans you need to do a thing is going to radically diminish. That's scary for everybody. My view is lean in, experiment, try. See what you can do at the edge.
Things like customer support, we are already aggressively leaning in.
The big question is, what is the time scale that it comes–is it 18 months? Is it 48 months? It's certainly less than five years.
What other opportunities are there for Parallels partners?
We're not a household name, necessarily. Or people, worse, maybe only think about us in a desktop frame and not a server or cloud frame.
If we get a chance to truly compete, we win. Both because of the total cost of ownership, simplicity. But also just where we're going versus where the industry is going.
When Citrix says, ‘We don't care if we get new customers, we're just going to milk our existing customers.’ And if you're a customer that they don't care about, what are you going to do?
We just want to make sure that we are the de facto partner. And that's why it's important for us to lean into the ecosystem, lean into the partner space, and recognize the value that they bring and not undermine it and not just torpedo it overnight.
With Omnissa and Parallels parent Alludo both owned by private equity firm KKR, could we see a merger?
We're very different companies. We're in different funds. And we compete head to head.
Now that a customer is going to have to consciously buy Omnissa for the very first time–this had been bundled in the past, so there was no conscious decision to buy it. And now customers are going to be like, ‘Do we want this, and do we want this at this price?’
That is an opportunity for us. And we compete directly and heavily with them.
This ‘essentials’ tier … (is) for emerging and new and emerging partners. We're going to use the data from that to better understand who we should be investing more time and energy in.
(The program has) higher margins for our resellers. We've got free certification training. We'll have a new partner portal, so hopefully it's just easier.
(We are) rethinking end to end what that experience is for the partner. Truth be told, in the past, sometimes, we had too much paper (for example).
If you had to kind of walk through what it would take to change something, it wasn't as easy as it should have been. We understand that.
We've got to listen. We've got to see where the pain points are. How do we evolve? How do we modernize? How do we make it easier–while keeping in mind what the partner's business is and leaning into that planner as aggressively as we can.
We also have concurrencies versus a named seat. So how we license ends up on its own being 20 to 30% cheaper just based on not having to have a named user.
How are IT budgets looking in 2025?
Everybody's always looking to scrutinize. I think CFOs are always looking to be more efficient.
But then there are areas where people are not willing to sacrifice, back to security and some of these other things.
The biggest concern is more, if you're seeing a 300% price increase (from a legacy vendor)–(budgets) aren't that healthy.
Now you're forcing somebody who might not have had to make a decision about their partnership structure for 13 years all of a sudden have to make that change. And sometimes it doesn't happen overnight.
People are saying, ‘Look, I know I have to leave Citrix. I can't leave Citrix tomorrow. But I'm absolutely going to leave Citrix within the next 12 months. And so how do we make sure that we're leaning in.