Microsoft acquires FSLogix to make their virtual desktop vision possible

FSLogix solves key technical obstacles that arise when when using Office 365 and virtual desktops together. This smooths the road for Microsoft’s upcoming Windows Virtual Desktop offering.

Microsoft today announced the acquisition of desktop app management startup FSLogix. Terms of the deal were not disclosed, but for reference, according to Crunchbase, FSLogix had $10.3 million in funding. FSLogix will be a key component in helping Microsoft realize their increasingly ambitious virtual desktop vision, as FSLogix Office 365 Containers solve issues that arise when using Office 365 and virtual desktops together.

The FSLogix story

FSLogix was founded by Kevin Goodman and Randy Cook, and came out of stealth mode at BriForum 2013. Initially, their focus was on a new flavor of Windows app management, which has been described as “app masking” or “cloaking.” The idea is that you can install a lot of apps in your base image, and then use their file system filter driver technology to hide and unhide apps as needed.

By 2015, FSLogix was finding other uses for their file system filter driver tech, by creating app and profile containers. In 2016, they added on to this with containers for Office. Most recently, they introduced their Cloud Cache technology.

A key feature of FSLogix Office Containers is their ability to enable Cached Exchange Mode for Outlook in RDSH and non-persistent VDI environments. If you’ve been in the desktop virtualization space, you’ve been aware of this problem for a few years now. But if you’re not, read Brian’s article from early 2015 for a technical description of the problem, and Gabe’s article from 2016 about how FSLogix Office Containers address it.

FSLogix has won awards and has a lot of fans in the industry, including a distinguished advisory board, as well as my two former colleagues. Gabe Knuth, who joined FSLogix earlier this year, and Brian Madden (the person, not this site), who was an investor.

Microsoft needed FSLogix

As Office 365 and hosted Exchange usage has grown, so has the need for solutions like FSLogix. As Cláudio Rodrigues pointed out in a recent white paper, Microsoft’s own User Profile Disks can’t fully support the challenges that come with Office 365.

Prior to the acquisition, Microsoft recognized this in various ways: for example, in this support document from 2017, and by partnering with FSLogix for the recently announced Windows Virtual Desktop.

Now, with Microsoft getting ready to push Windows Virtual Desktop (the public preview is planned for later this year, and general availability for the first half of 2019), buying FSLogix was a crucial move for Microsoft. Otherwise, their banner entrant into the cloud-based desktop space wouldn’t have worked with their flagship SaaS offering, Office 365.

Next, it will be interesting to see if Microsoft makes FSLogix into something that any desktop virtualization provider can use, or if it will be exclusive to Windows Virtual Desktop. Microsoft has already made plenty of other moves that make desktop virtualization more difficult for competitors, so by taking FSLogix off the general market, they would be further strengthening their position. But if profile and Office containers were something that just came with enterprise Windows SKUs, that would be awesome.

Either way, as I mentioned, FSLogix had many industry folks onboard with their vision, and congratulations are in order for their successful exit.

Update: Comments from Microsoft, 11:00am PT

After the news broke, I reached out to Microsoft to see if they had anything to share about the roadmap and product availability. Here are my questions and the responses from a Microsoft spokesperson:

Can Microsoft comment on how FSLogix will be distributed going forward? Will Microsoft continue to sell FSLogix products to any interested customer?

The FSLogix sales team will continue to focus on FSLogix product sales and at this time there is no change to how customers license and purchase our products. We will provide more information on product or pricing changes as they become available. Microsoft and FSLogix want to ensure our mutual customers get the value they seek from FSLogix’s products and will provide appropriate updates and notice prior to making any changes.

Or will Microsoft make FSLogix an exclusive part of the Windows Virtual Desktop offering?

“The specific integration plan for the products and technology acquired with FSLogix is still under discussion. Microsoft intends to provide the best experience possible for Windows Virtual Desktops and Microsoft Office 365 inside of Virtual Desktops. Microsoft will carefully evaluate the best way to deliver these experiences to our customers, and we are excited that FSLogix Solutions and Technologies will be a part of this commitment.”

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When is WVD shipping? Msft has been marketing for 12 months now!
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It's been announced at Ignite (sept 24), the public preview will come soon. GA is expected H1 2019. Stay tuned!
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