CF20: 2024's 20 Top DaaS Providers — Citrix, Microsoft, AWS, More

Desktop-as-a-service (DaaS) providers are experiencing steady growth after demand exploded during the COVID-19 pandemic.

According to Gartner, DaaS solutions allow remote workers, offshore workers, third-party employees, contractors, home workers and office workers to access virtual desktops hosted in the cloud. DaaS solutions include technology that allows centralized management of all virtual machines (VMs).

Channel partners can configure DaaS virtual desktops for customers in a variety of ways associated with contact center workers, process workers, information workers, and workers who require high-performance computing or rich graphics, Gartner notes.

This is Channel Futures' second annual “CF20” focused on top DaaS providers. Analysts shared their views on what it takes to succeed with the technology. It includes a new list and fresh views on changes in the competitive landscape.

According to Research Nester, the global DaaS market is worth $7.15 billion and will reach $61 billion by the end of 2037. That's a compound annual growth rate (CAGR) of more than 18%.

DaaS Providers to See Increasing Demand in 2025, Beyond

Roy Illsley, chief analyst of IT operations at Omdia, which shares a parent company with Channel Futures (Informa), said the DaaS market is only growing moderately, but Omdia expects to see it grow as the pressure on budgets and the demands of AI deployment increase in 2025 and beyond.

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Omdia's Roy Illsley

“The new AI PCs will bring the pressure on desktop teams and DaaS will be an option, so it is up to the vendors to sell its value and how it can help with the budget and people pressures,” he said.

DaaS has changed from its original offering, and the leading vendors are now positioning it as not just a way to deliver the desktop, but “I am expecting it to cover the apps and the new AI apps, which will be developed and deployed, so the market must consider the data,” Illsley said.

In terms of the competitive landscape, the obvious changes are Broadcom's disposal of VMware's EUC division and Citrix being owned by Vista Equity Partners and Evergreen Coast Capital, he said.

“Therefore, it looks like the market is being reinvented by these new owners as they will expect to see significant growth in their investment over the next five years,” Illsley said.

From Emergency to Calm

John Abbott, principal research analyst, and Eric Hanselman, chief research analyst for TMT, at S&P Global Market Intelligence, said the end-user computing sector, including DaaS, saw a huge boost in March 2020 as the pandemic spread and offices were shuttered. This also had longer-term implications, because many staff didn’t return to work in offices and may never do so. However, what once was an emergency operation to get remote workers online as quickly as possible has now changed to a calmer evaluation of complexity, compliance and security issues, and more rigorous cost evaluation.

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“The privatization of the two largest virtual desktop infrastructure (VDI) technology companies, Citrix and VMware’s EUC division, raises questions about the future of VDI, the underpinnings of DaaS,” they said. “It appears to have entered the legacy, low-growth zone, with substantial customer bases that need continued support, but aren’t looking for cutting-edge business transformation via these tools. Both VMware and Citrix struggled to convert their on-premises customers to cloud services and subscription-pricing models, which was one of the reasons that led to the acquisitions. Looking forward, it’s likely that DaaS will be driven by the big cloud hyperscalers with decreasing reliance on core technology from Citrix and VMware, except for legacy integration.”

DaaS Customer Choices

Those customers already using full-blown VDI in 2020 expanded their installations, but the less experienced chose options that were quicker, easier and, at least from a capex point of view, cheaper to implement, according to Abbott and Hanselman.

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“DaaS was one easy entry point,” they said. “But DaaS can also be expensive unless cloud costs are carefully managed. The other easy option was to adopt tools such as Zoom or the Microsoft-led collaboration tools bundled in with Azure cloud services. Meanwhile, native phone apps were rapidly upgraded with additional built-in management and security to make them more acceptable for corporate deployments, changing the dynamics of unified endpoint management.”

In addition to Broadcom-VMware and Citrix, Google acquired longtime partner Cameyo for its remote access technology in June, providing a fully integrated, simpler way to deliver Windows apps to ChromeOS, although this is virtual application delivery rather than virtual desktop delivery, according to Abbott and Hanselman.

“In that same vein, the rise of the enterprise browser has started to make inroads into VDI use cases,” they said. “They’re a more tightly controlled browser application that is also targeted at virtual application delivery and is seeing application in situations where VDI was traditionally applied. As enterprise applications have shifted to web front ends, enterprise browsers offer improved access and activity control. They can overlay multifactor authentication (MFA) on applications that weren’t built with it. They control user activities, such as copy/paste, filling the same role that VDI approaches have done.”

We’ve compiled a list, in no particular order, of 20 top DaaS providers in the slideshow above. It’s based on feedback from analysts and recent news reports. The list is by no means complete. The providers are making the most of the ongoing competitive landscape and charting success.