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Citrix Chief Mark Templeton on Maritz Status

In the course of interviewing Citrix president and CEO Mark Templeton yesterday for a profile I am writing on Citrix, I asked him what his reaction was to Paul Maritz's presidental title being divided among four new co-presidents, while Maritz retained his CEO job. As I expected, Templeton was circumspect and largely unwilling to speculate on what was going on behind the scenes, because he said he just didn't know. He did compliment Maritz as a competitor and a person, saying that he thought the VMware CEO was involved in the formulation of the plans that called for his title change.

Templeton is human. He couldn't help but speculate about what is going on with his chief competitor, and I'm sure plenty of his lieutenants have engaged him in conversation, but in my opinion, he's not the kind of guy who is just dying to know what's going on with Maritz. What good would it really do him? I don't see him playing on Maritz's mysterious status in an effort to pry customers away from VMware, or prevent new customers from signing up with them. He'd rather win points against VMware in the marketplace than in the rumor mill.

So why do presidents become ex-presidents? Financial performance is high on the list of things that come to mind, and if you based Maritz's performance on financial results, he seems to be doing pretty well. Fourth quarter 2010 revenues were $836 million, a healthy increase of 37 percent over the same period in 2009. Over all, in 2010, VMware had revenues of $2.9 billion, which represented a whopping 41 percent increase over 2009. The company's stock price has been up and down, with a 52-week low of $51.23, and a 52-week high of $97.61, and as of this morning, it was at $79.22. However, VMware certainly hasn't been the only company to experience those kinds of bumps in this fragile economy.

When I asked VMware for an update on the situation, they sent me the original reference to the early February SEC filing dryly detailing the changes, and also included a brief statement saying, "After completing an outstanding year in 2010, and with the need to drive even greater focus across the three layers of VMware's strategy, key leaders are stepping up to make further contributions. These organizational changes are in response to the tremendous opportunities before us to help our customers navigate the journey to cloud computing."

That is not exactly what I would call a ringing endorsement for the leader who played such a key role in making VMware the powerhouse it has become.

It's interesting that VMware is staying so quiet about the situation, which is only made worse by all the negative speculation it has spawned. One way or the other, this co-president things sounds weird, kludgy, and not likely to last very long to me. Does Maritz still have the final say on all important, company-wide decisions? Are the co-presidents really presidential when it comes to who rules the roost? Two years from now, will this whole situation be remembered as nothing more than an awkward shifting of the corporate gears?

What do you think? Is more presidential power at the top good for VMware and its customers? Chime in here.

Posted by Bruce Hoard on 03/15/2011 at 12:48 PM


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