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Microsoft and Others Vying for Desktop Virtualization


Four public companies are working to capitalize on the future of technology.

In Why the Hottest New Tech Solution Will Go Cold, I covered a brief overview of virtual desktop infrastructure (VDI) -- and in so doing, hoped to draw attention to the associated hype compared to market reality. In summary, I believe that while VDI will eventually become a big market, today the technology is materially over-appreciated and overvalued.

Simply put: The VDI hype far exceeds current market reality, and has for at least the past 12 months.

I will now outline the broader desktop virtualization (for short, DV) market, itself a superset of VDI, and provide an overview of each primary vendor's DV strategy. Five years from now, my firm, Marker Advisors, believes some form of DV will touch almost every business desktop/laptop/netbook, making the DV market of far greater value than its subset, VDI.

But back to today's reality.

Currently, there are four public companies chasing the DV opportunity: Citrix Systems (CTXS), Microsoft (MSFT), Quest Software (QSFT), and VMware (VMW). DV encompasses three desktop delivery methods (it's really three different, related technologies, only one of which is VDI):

1. Terminal Services (referred to as TS): server-based, shared applications that send graphics to a variety of computing platforms. This technology is very mature and exampled by Microsoft's Terminal Services (now called Remote Desktop Services) and Citrix Systems' XenApp.

Advantages include its low cost (a large number of users can hit a single server), reliability, mature delivery of information, and a large partner/customer base.

Key disadvantages are limited application compatibility (delivers mostly Windows applications) and a lack of end-user configuration. There must also be an operating system on the client.

It's best used as a secure remote substitute for a user's standard desktop, although it has also been employed as a low-cost desktop for task workers.

2. Application Streaming (AS): This technology streams (downloads) an application(s) to a user's desktop on demand, and then runs it locally. An image is kept on the server (so it's easy to maintain), while a copy or partial copy is sent to the desktop where it runs on the local operating system.

The primary advantage (and it's a big one) is that applications can take advantage of the local computing power, yet still be managed by IT like a server-based application. It's also secure by nature, as the streamed application is isolated from the other applications on the desktop. Examples are Citrix Systems' XenApp (includes application streaming as part of the TS license), Microsoft App-V/MED-V, and VMware ThinApp.

A main disadvantage is longer initial application start-up and shutdown times (application streaming/syncing time), and that an operating system must be present at the client for the application to run.
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