Virtual Desktop Infrastructure: Competing with Microsoft Office 365?

Roughly 36 percent of managed services providers (MSPs) are testing or deploying some form of virtual desktop infrastructure (VDI), according to our preliminary MSPmentor 100 research results (the survey closes Dec. 17.). But here’s the twist: If Microsoft would adjust its licensing policies for Windows and Office, I suspect VDI would catch on even faster with MSPs. And once Microsoft’s Office 365 arrives in 2011, I wonder if VDI’s momentum will slow. Here’s why.

This blog starts on two upbeat notes. The VDI Coalition may help to accelerate VDI deployments. And customers sure seems interested. My story starts with a Cisco solutions provider headquartered in New York. The solutions provider recently built a proof-of-concept VDI solution for a midsize customer. The performance looked fantastic. The ROI (return on investment) looked solid. But the entire deal fell apart when the customer realized they would have to dump all of their existing Windows and Office PC licenses, then pursue new Microsoft licenses for the VDI solution. There was no simple way to apply the existing PC software licenses and transition them over to the VDI implementation.

I must concede: I need to speak with Microsoft more extensively to gather more facts. And I promise to do so in the days ahead. But I keep hearing the same story from multiple MSPs and VARs: They’d promote VDI… if only they could sort out the software licensing challenges.

Meanwhile, lots of MSPs seem increasingly distracted by Office 365 — the forthcoming successor to Microsoft Business Productivity Online Suite. Microsoft is doing a lot right with its cloud strategy, promoting the Windows and Office brands at aggressive pricing heads-up against Google. But some partners worry they will get killed in the crossfire.

My big question: Will VDI truly become universal before Office 365 becomes ubiquitous? Or is that an Apples to Oranges comparison? Maybe it’s just a matter of MSPs emphasizing customer control. In the VDI world… all the customer data can still live on a local server. In the Office 365 world, the data can live locally or up in the cloud… I suspect when it comes to desktops customers will prefer the local approach.

But so far I don’t have any clear answers. At least not yet. I’ll keep searching.

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