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 Channel Futures

Cloud


Virtualized Desktops: A Real MSP Opportunity?

  • Written by Joe Panettieri 1
  • August 4, 2009

Consider the following scenario: In order to improve desktop reliability and reduce the total cost of PC ownership, you virtualize your customers’ desktop environments in a cloud. Can managed service providers deliver that type of solution today? Companies like Canonical, ICC Global Hosting, IBM and Virtual Bridges such seem to think so.

At CompTIA Breakaway 2009 in Las Vegas, ICC Global Hosting has unveiled a virtual desktop hosting partnership progream. According to a press release from the company:

“…the ICC Partner Program empowers partners with a hosted desktop solution which can generate immediate margin and a recurring revenue stream without any capital investment or ongoing expense.  Customers benefit from outsourcing the hosting of virtual desktops, gaining all the benefits of virtual desktops without a CAPEX investment, and while relying on their trusted IT consultant, VAR, or integrator to provide the proven solution.”

Plenty of technology companies share in the virtualized desktop vision. For instance, IBM is working with Canonical (promoter of Ubuntu Linux) and Virtual Bridges to offer virtualized Ubuntu desktops on Linux servers. The IBM strategy openly attacks Microsoft’s fat client model, and aims to charge customers $50 per seat (per year, I believe,  though I need to double check).

Already, Midas Networks — an MSP in Austin, Texas — is testing the IBM-Canonical-Virtual Bridges solutions. And during a phone discussion last week, Virtual Bridges President and CEO Jim Curtin told me the solution is winning business head-on against alternatives like VMware.

Challenges Remain

Still, I’m not suggesting that the virtualized desktop model is perfect.

In some regions, customers may lack adaquate bandwidth for virtualized desktops. Other customers may have corporate compliance issues that force them to keep their desktop applications in-house. Still others may prefer “local” applications for road warriors who often need to work offline.

No doubt, progress will continue on the virtualized desktop front. For instance, many software providers are developing or have delivered applications that can run (A) in the cloud and (B) offline locally, for when a computer lacks a network connection.

I’m meeting ICC Global Hosting at CompTIA Breakaway and will share more info. In the meantime, if you have questions for them and other virtualized desktop specialists please let me know.

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Tags: Cloud Service Providers Digital Service Providers MSPs VARs/SIs Cloud

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16 comments

  1. Avatar Mytechmanager August 4, 2009 @ 8:25 pm
    Reply

    I think the idea is long over due. I am currently gathering data on the same idea for other companies. check it out http://mytechmanager.blogspot.com

  2. Avatar Nick Vossburg August 5, 2009 @ 12:44 am
    Reply

    From one MSPs perspective, the ultimate goal is to provide a quality service at an affordable price with the challenge of a geographically diverse, dynamic, and complex client base.

    MSP platforms provide an effective tool to help turn the tide in our favor although in the end if the customer controls the infrastructure we’re playing the insurance model.

    Providers have already begun to transfer the core infrastructure to the datacenter with hosted Exchange, SharePoint, OCS to better control costs and achieve economies of scale. However, the desktop remains one of the most difficult and costly assets to manage.

    VDI is the solution, it offers significant advantages to the client in the form of reduced hardware expenditures. For example, employers have the ability to eliminate PC purchases altogether. Many early adopters of the service have provided employees with a stipend to purchase the laptop (including Macs) of their choice and just deliver them a VM client. The IT department then only bears the responsbility of supporting and managing the VM, eliminating the constant rotation of equipment and vastly reducing the TCO of the asset.

    MSPs are the biggest beneficiaries of this technology by presenting a solution that offers better flexibility than a terminal server yet still maintains a centralized, scalable, and easy to manage environment.

    The objection of what if I don’t have an internet connection is being eliminated for most businesses based in metropolitan areas given that its becoming increasingly difficult to not have an internet connection, WiFi on airlines, mobile broadband, etc.

    If that doesn’t provide comfort, VMWare is also offering an offline mode to address the issue, described as: “Virtual desktops may be “checked out” onto a physical device enabling users to work when they are offline, and then “checked in” back to the datacenter—intelligently synchronizing changes”

    MSPs will be able to provide a better service experience at a lower price by shifting the last remaining challenge, the PC, to the datacenter.

  3. Avatar Josh Clifford August 5, 2009 @ 2:01 am
    Reply

    I couldn’t agree more with Nick. Also don’t forget that Zenith is working on bringing the virtual desktop cloud behind the clients firewall to address the objection of corporate policy or just the plain fear of being an early adopter. There are a lot of companies trying to get the technology right so it is only a matter of time before managed service providers will have to offer these options or be left behind.

    Josh

    http://www.mspcoach.com
    http://www.everonit.com

  4. Avatar Brian Doyle August 5, 2009 @ 10:22 pm
    Reply

    I am in the camp of Nick and Josh, this is a great opportunity for MSP’s. A key requirement for virtualized desktops will be creating an easy to scale standard service offering. This needs to be done while still allowing organizations to have a custom image to meet their individual user requirements.

    Self-service provisioning of these services will also be an important requirement for both MSP’s and clients that adopt virutalized desktops. Employees are hired and fired daily and the ability to manage a more dynamic environment will be a must for virtualized desktops to thrive and for service revenues to grow.

    Brian Doyle
    http://www.fandotech.com

  5. Avatar Brian Doyle August 5, 2009 @ 10:25 pm
    Reply

    I am in the camp of Nick and Josh, this is a great opportunity for MSP’s. A key requirement for virtualized desktops will be creating an easy to scale standard service offering. This needs to be done while still allowing organizations to have a custom image to meet their individual user requirements.

    Self-service provisioning of these services will also be an important requirement of both MSP’s and clients. Employees are hired and fired daily and the ability to manage a more dynamic environment will be a must for virtualized desktops to thrive and for service revenues to grow.

    Brian Doyle
    http://www.fandotech.com

  6. Avatar Gerson August 6, 2009 @ 12:05 am
    Reply

    We still meet many clients that are resistant to move their data off of their on-prem servers and into our data center – in spite of huge savings.

    Cloud based VDI is where we’ll end up – but I predict it will take another 3 years or more before small business under 100 seats warm up to it. Once the data is not physically in their office – many business owners feel they don’t have control and simply don’t want the risk of trusting in an IT provider which could cut them off from their data at anytime.

    Local on-prem VDI like what Zenith is planning with their new service will serve as a good bridge until a complete cloud experience becomes more mainstream and acceptable to the average small business owner.

  7. Avatar Joe Panettieri August 6, 2009 @ 12:13 am
    Reply

    Furthering many of the points above, I think many businesses will weigh whether to deploy fat Windows 7 clients or thin clients connected to servers running virtualized Windows 7 applications…

  8. Avatar Brian Doyle August 6, 2009 @ 5:56 pm
    Reply

    I will also say that while I agree true adoption might take one more buying cycle for many companies as Gershon pointed out, we have seen companies show more serious interest in moving to the cloud as their capital budgets diminsh. The state of the economy has seemed to pique the interest of many leveraging an operational cost vs capital expense.

    Brian

  9. Avatar StuFinancesTech August 7, 2009 @ 12:49 pm
    Reply

    As a non-tech business owner, I’d be hesitant to move everything off into the cloud, VERY hesitant despite the svgs and the fact that I’m comfort with some features and apps utilized that way. At this point, I wouldn’t want my client data out there like that.

    Stu

  10. Avatar Nick Vossburg August 7, 2009 @ 1:35 pm
    Reply

    Stu,

    Thats an interesting perspective and helpful for the MSPs on this conversation.

    Its obvious that the security of your client data is a concern, as it should be, however do you feel your internal IT infrastructure is more secure and stable than a datacenter or cloud infrastructure?

    No wrong answer here, but appreciate a deeper perspective on the resistance to move to a hosted environment.

  11. Avatar Sivaramakrishnan August 7, 2009 @ 3:30 pm
    Reply

    If security of the hosted cloud is a concern, they why not use authentication and authorization solutions? This can help identify and authenticate every user accessing the cloud from client location. Also each user could be authorized to use specific cloud services based on the previledges. The client could also be given a monthly or quarterly report on the cloud access.

    Will this measure be anyway helpful to boost the confidence of the clients? Please let me know your thoughts.

    If this can be an acceptable solution, I can work with managed service providers to validate this concept.

  12. Avatar Sid Herron August 7, 2009 @ 5:04 pm
    Reply

    The point Gerson raises is not trivial, and has to be answered before most businesses are going to move their data to the cloud: Once my bits are on YOUR hard disks instead of mine, what protection do I have from you holding my data hostage if, for example, we get into a billing dispute? If a business is cut off from its data, the effect is indistinguishable from a disaster-recovery scenario. If it takes days to get the data back (or restore access to it), it may be moot, because I may go out of business in the meantime.

  13. Avatar Joe Panettieri August 7, 2009 @ 5:15 pm
    Reply

    Sid, Gerson: You raise valid concerns about moving desktop information into the cloud. But MSPs can also virtualize customer desktops onto the customer’s own on-premise servers. My question: Are customers interested in that option or do most still prefer full-blown desktops?

  14. Avatar Mark Moeller August 7, 2009 @ 5:43 pm
    Reply

    Joe, hosting a customer’s desktops on premise is possible but the customer then loses the benefit of reducing power consumption and also consumes more data center space. The best solution for the client if to have the desktop hosted off-site. If they are going to outsource their desktops they need to go all the way and let the hosting provider have physical access and responisiblity for the environment. Ultimately the specialilzed desktop provider can host these desktops in larger quantities faster, better, and cheaper than the customer in the provider’s own hosting center environment.

    By the way, it was a pleasure talking with you about our partner program and hosted desktop solution at the CompTIA Breakaway. I am delighted this blog posting has generated so much discussion on the topic.

  15. Avatar Joe Panettieri August 7, 2009 @ 10:16 pm
    Reply

    Mark: Great to connect at Breakaway, and thanks for sharing more thoughts with MSPmentor’s readers.

  16. Avatar Gerson August 8, 2009 @ 2:21 am
    Reply

    Joe – We offer our IT services as a utility and have been able to appease many of our customer’s concerns by installing our servers at their office – clients then purchase their own desktops and can rest assured that “their data” is in “their office.”

    The question you are posing about whether clients want a full blown desktop or a thin client is very interesting. There’s a lot of factors currently at play in making a decision about what sits on your employee’s desk.

    – Traditional desktops are cheaper than they have ever been – so for price to be a motivator VDI has to be nearly free.

    – Laptops are steadily gaining a larger share of the market and in many estimates are now more than 50% of the market – also consider people like to take their laptops home and be able to use them offline (not ideal for VDI)

    – Small businesses are typically not as rigid with policy as are large corporations and try to operate with as few rules as needed – this goes in the face of traditional VDI installations which are homogenized and strictly locked down – with little room for flexibility. An MSP offering VDI could allow users to freely install apps and change whatever they want – but you’re then back at square one managing desktops wildfires, rebuilding profiles and using restore points.

    – VDI is still expensive to deploy/maintain – vs. the cost of a $1000 laptop that can last 3 or more years. I’ve spoken with one of the larger VDI players – Citrix about XenDesktop – they’re targeting it right now for 200+ seat installations – we’re a partner with them and have run rough numbers on the required hardware and software licensing. Smaller installations are not even on their radar.

    So Joe to go directly back to the great question you posed – In my opinion most CEO’s will not care if their desktops are virtual or traditional PCs – it’s still a screen/keyboard/mouse sitting on their desk. What will get their interest is a device that’s cheaper to maintain (i.e. no I.T. guys needed) and that where us as the MSP comes in and starts offering VDI not as an option, but as part of our services with the devices at no additional cost – and then that’s when DELL really starts to freak out. This will be a big change in direction for MSPs – going from troubleshooting the client’s desktop to offering a “desktop service” as the end deliverable.

    …But until Citrix and company dramatically lower the barrier of entry – the traditional PC will be here. Zenith’s Box Office is a great start – but we need many more players in the space at the price point Zenith is offering for us to make it part of our main offering.

    For now virtualization still has a lot more ground to cover on the server side – it’s helping us be more successful with our offerings.

    Gerson
    http://www.degasystems.com

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