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Reference no. E267A
Subject category: Entrepreneurship
Published by:
Stanford Business School (2008)
25 June 2008
30 pages
Data source:
Field research


After significant changes in management, strategic direction and product focus, XenSource, a virtualization software start-up that relies on open source code, faces key decisions regarding the pricing and packaging of its products, a challenge which is compounded by two additional factors: the tension with all of the trappings of open source and the objective to catch / overtake the established incumbent, VMware. First, the case aims to help students gain an understanding of the importance of alignment between company, product and pricing strategy. Second, the company''s go-to-market strategy itself comes in to question when the new CEO needs to pick one product to focus on first to channel the company''s resources as well as anticipate where the market is going in terms of competitors, partners and customer need. Third, the case deals with the massively complex strategic nature of managing the biggest players in software, hardware and open source, namely Microsoft, Intel, Red Hat, Novell, HP and IBM.


Sales, marketing and pricing; Go-to-market; Open source; Start-up; Restart; Overtaking an incumbent; Virtualization; Software

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