VDI has long shown a lower TCO than physical desktops, but until mid-2014 the savings were in operational costs; per user capital costs were actually higher, representing a barrier to adoption for many organizations. With the launch of Horizon 6, the scenario changed and VDI is now the lowest capital-cost option, as well.
This was a significant landmark for end-user computing, but not the end of the story. VMware sees cost reduction as a journey—and there are more steps to come.
The Starting Point – Spend Now To Save Later
From the first VDI deployment in 2001, the value proposition was clear: multiple users share common data center infrastructure and access their desktops remotely. The centralized and shared infrastructure delivers efficiencies, and hence savings, in operations.
Advances in virtualization technology and the commoditization of hardware drove steady reductions in the per user cost of servers and networking, but the cost of storage remained high and was the single biggest factor in keeping per user capital costs higher than for a physical desktop. By 2012, the cost equation was simple: spend upfront to save over a lifetime of use and deployment. Industry analyst estimates typically showed annual reductions of around 10 percent, but that initial capital expense was 10 percent higher.
Storage Appliances – Steps To Cost Parity
Most early VDI deployments used storage area networks (SANs) to support desktop images and user data. The performance was good, but the cost was still too high for many.
The VDI ecosystem stepped up to the challenge and delivered new storage products optimized for virtual desktop deployments. Companies like Atlantis, Tintri, Nutanix, Nexcenter, and EMC all released smart appliances that significantly drove down per-user costs. The savings were significant, but still not enough. By the end of 2013, analyst estimates showed the capital costs of VDI were almost equal to those of physical desktops.
2014 saw the release of VMware Horizon 6 and, for the first time, the per user capital costs of VDI fell below those of physical desktops. The primary cost-saving category was again storage, where our Virtual SAN technology delivered major capital cost savings.
Virtual SAN uses direct attached storage in servers to build a virtual storage area network—in effect, it delivers on the long-term promise of low-cost, gridded storage. A combination of solid state and disks maintains I/O performance while delivering big savings: we saw average per user reductions of more than 25 percent in capital costs and 10 percent in operational costs. VDI now held cost leadership in both OpEx and CapEx.
Horizon 6 Moves On – App Volumes and EVO
VMware App Volumes uses smart isolation technology to deliver “stacks” of applications in close to real time to any desktop. It also delivers a significant reduction in per user storage requirements. App Volumes was added to our Horizon desktop and applications portfolio in late 2014, and customer business cases show reductions of at least 30 percent in required storage space (often more). Whereas Virtual SAN reduced the unit cost of VDI storage, App Volumes has reduced the number of storage units required.
EVO is VMware’s hyper-converged infrastructure initiative—combining storage, server and networking infrastructure into an appliance that is quick to deploy and simple to manage. The first product, EVO: RAIL, is designed to minimize operational and deployment overhead. EVO: RACK will be optimized for higher scale deployments and will combine these operational cost savings with further reductions in capital costs.
Next Generation Operational Costs From DaaS
Horizon 6 is our on-premises product, but other areas of our desktop portfolio are bringing savings to customers, too. Horizon Air, our desktop-as-a-service offering, splits desktop-image operational tasks between the categories of core image and application customizations, with only the latter overhead borne by the customer (all core image management is done by the service provider). Average operational and administrative costs per user are cut by nearly a half.
The Cost Leadership Journey Continues
In isolation, the cost saving advances we have made with our on-premises and off-premises products are already significant. In combination, they change the VDI cost and value equation completely—and it is not just VDI: The same Horizon 6 and Horizon Air platforms support other delivery models, too (published applications and desktops), where all these savings apply in much the same way.
But we are not done yet! We are already working on initiatives to drive down capital and operational costs for on-and off-premises deployments still further.
Our Hybrid Goal
By combining the capital-cost reductions of Horizon 6 with the operational-cost savings of Horizon Air, we have set a new per-user cost goal—one that we know resonates with the aspirations of our customers: $30 per user per month—for all infrastructure (server, storage, network, access device), software, and operations (help desk, desktop and image management, infrastructure management).
How far away are we now? Not far: we estimate that Horizon 6 Enterprise Edition, which includes App Volumes, has taken average per user costs down to $36 per month. By comparison, a physical desktop today averages about $62 per user per month. We know further reduction in capital and operational costs can be achieved and we will continue to drive these through both Horizon 6 and Horizon Air.
What To Do Next?
If you are considering your next round of investments in end-user computing and had dismissed VDI as an option because of cost—look again! We know that “mileage can vary” and that your costs might not be average costs, but the advances described here are real. And if you are a partner, currently delivering a more expensive solution, it is time to get up to date.