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Calculating TCO for Cloud Desktops

November 14, 2013 - Article

Andrew Pryfogle

**Editor's Note: This article is an excerpt from the Digital Issue, "Virtualizing Desktops in the Cloud," which is available for download from Channel Partners Cloud Insights.**

By Andrew Pryfogle

Cloud desktops, also known as hosted virtual desktops (HVD) or desktops-as-a-service (DaaS), are starting to gain traction, but the complexities around selling them continue to confound many channel partners. While some partners have become proficient in making the total cost of ownership (TCO) argument for cloud infrastructure or hosted VoIP, building a compelling TCO for cloud desktops is proving ... well, more cloudy.

Much of the confusion comes from comparing virtual desktop infrastructure (VDI) to traditional PC deployments — a debate that has rages for years in the enterprise IT community. In that discussion, many have argued that VDI deployments require more capital expenditures, more expensive virtualization software licensing and more high-priced IT engineering talent. In fact, a 2010 white paper published by Microsoft Corp. argues that VDI deployments for traditional office workers cost 11 percent more than a well-managed PC environment. But DaaS is not VDI; it's a cloud-based, multitenant VDI service — a difference that changes the game entirely.

It may help to think of hosted desktops as analogous to hosted VoIP. In the world of computing, the individual PC would be equivalent to a PBX. However, you would never dedicate a single PBX to a single phone user — that's silly. But in the computer world, we dedicate processing, storage and applications on a 1:1 basis all the time. VDI, in this analogy, then becomes the equivalent of deploying a single PBX to serve many phone users in the same office — that makes sense. Just as hosted VoIP enables customers to leverage the economies of multitenancy, so do hosted desktops. DaaS is VDI-as-a-service provided with efficiency and scale by cloud service providers serving hundreds of companies and thousands of users for a zero capex, monthly per-user price and at a TCO substantially lower than the alternative.

TCO Modeling

So how do you make a compelling TCO argument? What are the key elements to measure? What are the tangible comparisons to make? What are the intangible advantages of DaaS? How do those factor into your TCO analysis? These are tough questions to answer in a brief article, but here are the basics:

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