More than halfway through what vendors and many analysts predicted would be the year virtual desktops would replace enormous numbers of the physical kind, sales of desktop virtualization products are growing at a rate "that looks about the same as in 2009," according to Ian Song, analyst for International Data Corp.
IDC's July report on the PC market showed sales increased 22.4 percent globally for the first six months of 2010 compared to 2009, driven by enterprise needs to upgrade aging PCs ignored during the 2007/2008 recession and greater penetration of PCs internationally.
IDC won't report on virtualization sales until mid-August. When it does, there won't be anything indicating shocking growth in virtual desktop infrastructures, Song says.
"VDI remains a tactical decision," Song says. "Purchasing decisions are largely made by IT professionals looking for a solution to a particular problem. Strategic decisions that might lead to VDI being adopted more widely won't happen until there long-term results showing a solid return for companies that aren't early adopters."
That's not the way it was supposed to work.
Virtual Desktops and Aging PCs
During 2010 sales of corporate desktops was supposed to surge -- driven by improvements in the economy, the need to refresh aging PCs and upgrade to Windows 7. The complexity of that dual upgrade would be enough, vendors and analysts predicted, to justify migrations to a virtual desktop infrastructure, not just a new physical one.
A survey of more than 800 businesses conducted in December 2009 and January 2010 by longtime Forrester analyst and now independent consultant Merv Adrian showed 31 percent of companies planned to implement VDI in 2010, compared to 13 percent the year before. A report relased by Gartner in March of 2009 predicted that licenses for hosted virtual desktops -- VDI hosted by an outsourcer or cloud-based service provider -- would grow from 500,000 in 2009 to 49 million in 2013.
"There's no hotter market in high tech this year than Virtual Desktop Infrastructure," read an April, 2010 entry in Adrian's blog.
The hoped-for VDI takeoff didn't happen, according to Brian Madden, analyst and principal editor at desktop virtualization discussion site BrianMadden.com. End-user companies are still experimenting with VDI and are expanding it where it's really needed; VDI products don't perform well enough and aren't feature-rich enough to make migration "a no-brainer," Madden writes.
In a frustrating twist for vendors, the evidence of desktop virtualization's growth may not appear until long it has become common, Adrian says.
"VDI is one of those phenomena like the 'year of the LAN' that we waited for but that came and went without [analysts and journalists] ever identifying the tipping point," Adrian says. "With VDI the sale-able merchandise associated with it is not easily separable from products used for other things. It comes into companies as part of a larger software suite, or with site licenses, and there may be no one tracking after the contract is signed how many seats are actually in use. We may only be able to identify the tipping point retroactively."
Some CIOs Surprised at Slow Rollout Rate
Even the CIOs who set the strategies and pay the bills are sometimes taken aback at the relatively slow adoption rate.
"I was actually surprised recently at a CIO roundtable that when someone asked the crowd who was using a lot of VDI, I was one of only a few who raised my hand," says Peter Weis, vice president and CIO of $1.5 billion shipping company Matson Navigation.
"Of our 750 or so office workers we have nearly 20 percent on VDI as of Q3 2010, and we'll likely move to over 50 percent in the first half of 2011," Weis says.
Many business-unit leaders still have to be educated and worked slowly into changes that depend on SaaS, cloud computing, virtual servers and other technology developments that move what they think of as the computer out of their department or even out of the company, Weis says.
"Moving faster with VDI or with some SAAS options makes people nervous," Weis says.
That's not to say that multi-thousand-seat deals for VDI aren't being signed or that VDI isn't finding its way into roles other than its traditional strength in call centers and bank-teller desks, Song says.
"People are used to using XenApp or terminal-services remote applications," Song says. "It's migrating them from XenApp, even if they're using it to provide remote desktops, to real VDI that requires a lot of additional preparation -- in training, in upgrades to support higher I/O across the network and to network storage. Any desktop migration can take a long time, VDI particularly."
And, in a way, Windows 7 particularly has increased the number of virtual desktops being run in corporate America, even if it's not in the way VDI vendors or fans would prefer.
"There's lots of virtualization going on with Windows 7," Song says. "It's mostly people running incompatible apps in XP Mode [Windows 7's built-in XP virtual machine]."
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