Desktop as a Service & Workspaces Whitepaper
If you sit inside any isolated niche of the virtual desktop infrastructure technology market, you could make an argument traditional VDI is dead and that the boom days are over. Complex on-premises software deployments are likely to continue to meet enterprise requirements for diverse use-cases. Desktop as a Service offerings are likely to satisfy specific usability and operational requirements, while cloud based IaaS options are beginning to take compute workload from the traditional on-premises desktop virtualization deployment model.
The technology vendors epitomize this changing market. Citrix has undergone highly visible structural and operational changes, following Elliot management throwing the toys out of the cot (yet again). VMware has quietly continued to deliver & advance its VDI and cloud delivered DaaS offerings. It's still nothing compared to vSphere revenues, but it's still meaningful business and a growth path for this wildly successful organization. Amazon entered the market in 2014 with Workspaces, and continue to self-reference an internal and partner global deployment for over 150K seats, now 2-years into deployment.
Meanwhile, traditional desktop hardware business units from HP, Dell, and IBM continue to exhibit phenomenal stress, while Apple now would easily place #44 right, after Ireland, if you factor 2015 AAPL revenue against GDP. Seems we REALLY like buying well-engineered and manufactured products, which don't require replacement after 2.5 years and manage to address a range of personal, business, and mobile use-cases.
Yet today Citrix claim over 100M virtual desktops globally, and this roughly represents 1/2 of global market share with VMware and a smattering of others. So for the percentage of worldwide population (7.4B/200M), that's 2.7% of the working and non-working world population on given grain of technology. Not shabby for 20-year old foundational technology. The recently announced Citrix CEO post for Microsoft veteran who drove Microsoft Dynamics to SaaS delivery and profitability is a leading indicator: Citrix will either accelerate the delivery of their products via cloud (and catch up), or join the lot of once wonderful technology companies in the netherworld of has-beens.
Enter CaaS (Confusion as a Service)
Another diluting factor on the VDI market is the massive impact of cloud services on small to medium business. The original VDI or application virtualization business case was based on a combination of mobility, security, data governance, and application access use-cases: effectively a way for all companies to control application and data access, while maintaining the Windows desktop user experience.
But for small to medium businesses who rely primarily on file, email, and mobility, VDI became a non-starter next to the pay per use models for traditional office services from Google, Microsoft, and maybe Citrix, Amazon, and Apple in the future. Why on earth would you pay $100's per virtual desktop per month, when you can pay significantly less for the same basic result? But why does this segment fall off the map so quickly? SaaS office products generally work, and are incredibly inexpensive. The reality is that for most small businesses, staying in business trumps their concerns over data sovereignty and reduced supportability of the environment.
The Next Episode
In a market where everyone is proven wrong at some point, it's incredibly difficult to make bold predictions - especially on publicly traded companies going through M&A, restructure, divestment, and upheaval.
In general, I'm bullish on the technology concept of desktop and application and desktop virtualization, because medium to large companies cannot survive without the necessary security and governance controls, and everyone is sick of buying/shipping/installing/replacing tin. Plus, it's terrible for the environment.
Most importantly, the entire virtual desktop delivery model is evolving, and there is likely a mix of on premises deployments, hybrid private/public cloud deployments, and adoption of pure cloud based DaaS for specific use case needs.
Thanks for reading. Check out our recently released DaaS & Workspaces Technical Whitepaper here.