What's Microsoft's real reason for killing VECD?

By now you've all read about the changes Microsoft made to virtual desktops licensing last week, including: If you have Software Assurance (SA), there's no more "virtualization tax." (In other words, you don't have to pay an additional fee to access virtual Windows desktops.

By now you've all read about the changes Microsoft made to virtual desktops licensing last week, including:

  • If you have Software Assurance (SA), there's no more "virtualization tax." (In other words, you don't have to pay an additional fee to access virtual Windows desktops.) Another way of saying this is that with SA, VECD is now free.
  • For client devices not covered by SA (thin clients, PCs running Linux, Macs, etc.), the annual fee for connecting to Windows virtual desktop environments is now $100 instead of $110. Also the name of this was changed from "VECD" to "VDA." (Virtual Desktop Access)
  • The new VDA license allows the user to access his or her virtual desktop from different client devices (although the license is tied to the primary device and not the user).

Simon Bramfitt has a good and complete analysis of what the deal is and isn't (and he points out some of the weird things in it still), so there's no point in me rehashing everything here. What is worth discussing here is the timing and the intent behind the licensing changes.

Microsoft themselves said they're making these changes based on customer feedback—a statement which is laughable considering that everyone hated VECD since they first announced it almost three years ago. If they really made changes based on customer feedback then we'd (1) seen this change in 2007 and (2) finally have per-user licensing instead of per-device licensing. (Chris Wolf has some great thoughts about that.)

Why did Microsoft finally come around?

I'm not sure what this says about me, but when I hear that Microsoft makes changes that everyone likes, I'm immediately suspicious. (Queue Admiral Akbar) What's their ulterior motive? BrianMadden.com user Icelus commented:

I am willing to bet that MS used VECD to keep VDI adoption at a low pace until they and their partners were more ready to take on their competitors with their hypervisor offerings. It would have been a nightmare for MS and their partners if VDI was all run on ESX/vSphere.

That sentiment is the perfect blend of crazy conspiracy theory and technical insight (the BrianMadden.com cocktail of choice), so naturally I want to believe it.

But think about it? Why else would Microsoft announcing that they were "fixing" VDI licensing, effectively blessing the use case, on the same day they announced RemoteFX and Hyper-V dynamic memory, on the same day Citrix announced major improvements to XenDesktop, and on the same day that both companies announced heavily discounted VDI bundles and free competitive trade-ins?

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I do believe that part of it is that Microsoft through something out there (VECD) to slow down adoption.  Do I think that it is completely because they were trying to play catch up with their partners? No. IMHO Microsoft, as they do with everything else, introduced VECD simply for one reason, money.  Anyone that is familiar with their device CAL licensing, Office licensing, etc knows that they put language in place to make sure you have two choices.  Limit yourself by fixing their technology to particular devices or people in an organization so you can control costs, yet at the same time remove flexibility...OR...remove cost control mechanisms and have all the flexibility you want with a hefty price tag.  Desktop virtualization was about flexibility and agility to change and VECD was the tax associated with that Microsoft's normal method of operation.


To your second point, why didn't we get this in 2007? To me it’s simple Microsoft takes a long time to make change. Look at their products and how long they take to come to fruition.  Hell just look how long it’s taken for something to happen with Calista.  It’s not that they don't listen to their customers, they just take a long time to respond to customers demands (my conspiracy theory is that I still about the money :) ).


In all, I do agree that what you stated is a part of the reason Microsoft took so long, I just don't think it is the major reason.


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Thank you Brian for the acknowledgement, it comes at high value.


I also like tjbruni13's point of view, it's similar because it's for the money. (Even though my statement doesn't explicitly point it out, it's still apparent)


I don't think anyone can say with a straight face that MS is quick on the draw.


The difference is how deep the money trail goes as well as the need for control. It also gets you thinking a little bit more.


On another note, notice how Citrix XenServer 5.6 which has been released to beta at perfect timing to this announcement all of a sudden has Dynamic Memory Control?


I am wondering if both MS and Citrix are both re-inventing the wheel on there own or if that is a joint collaboration. After all, didn't Citrix help MS develop Hyper-V?


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Don't be shy... Everything is about money. If Citrix is "Trading Up for XenDesktop" or if VMWare is "giving away View seats", it is just to protect their own customer base and get more money from it... That's how the life is.


Is this fair ? probably not but this if how it work.


For MSFT to be slow to move, even if this is true, we do not have to forget that the install base they have to move (their ball and chain) is bigger than everybody else... Will not help.


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Stifling competative innovation is key to maintaining MS's monopoly. For proof, take a look at the number of software patents filed by MS in Korea lately, the Windows 7 SKU hardware limitations that killed OEM netbook models, and last but not least, the lagging Internet Explorer.  These decisions by MS limit customer choice for technology solutions.


VECD was never good for the customer.  They created VECD for the exact reason Icelus said; to inhibit VDI market growth on competative platforms while MS could further the development of HyperV and RemoteFX technologies.


Icelus admonished me about vendor lock-in in a previous comment and he made some good counter-points, but MS clearly still believes in embrace, extend, and extinguish.  This is not only a HyperV server virtualization play, it's an SA play.


1) You must have SA or pay the VDA tax of $100/device and oh, you can only transfer that once every 90 days.  Kills byopc/smart phones as client devices and service providers are still left with no viable licensing model.


2) RemoteFX requires HyperV/Windows 7, it's LAN only and will require a WAN protocol extension from Citrix or Quest.  Kills XenServer and increases the complexity and cost.


3) Thin client vendors lose out because the $100 VDA license money goes to MS for using a non-SA device.  These things will have to be damn cheap to offset that MS tax.


And what kills me and is totally disingenuous; people are thanking and applauding MS for the VECD move!  Are these guys all in locked and padded rooms?  Yea!  MS killed that nasty VECD imposed on us customers by...oh yeah: Microsoft.


Rodd


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History repeats itself.  Microsoft did a similar license change for their back-office servers when they first released Hyper-V.  I agree, they're showing a pattern where they are throttling adoption until they can come out with their own solution.  Now that the flood gates are open, I'm expecting to see a lot more Virtual Desktop adoption because the business case just got a lot better.


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@Rodd


That's some great insight about the SA play. MS definitely needed more backbone for SA.


I am glad my comment wasn't perceived as condescending, looking back I could have relaxed a bit.


@Brian


I heard your story about what VMware might do, but what about Citrix?


Aside from bundling Essentials for XenServer (not Hyper-V) with XenDesktop, do you think there is going to be a change for XenDesktop to favour XenServer over Hyper-V?


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Geoffrey Moore's insights from Crossing the Chasm  are as true as ever: '. . . as owner of all the clients in a client/server world, (Microsoft) has a permanent enclave on the pragmatist side of the the chasm. It controls the gates to the city. When barbarians show up with their discontinuous innovations, it can shut the gates. When it shows up with is own versions of the same, it can open the gates . . ."


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IMO Microsoft's landing on desktop virtualisation is all about Hyper-V and Windows 7 - protecting its revenue models, and unseating VMware as the infrastructure platform provider of choice in the race to the cloud.


Virtualisation is the key component to unshakling an enterprises infrastructure components and applications allowing them to run and be hosted anywhere - we all know it and Microsoft knows it too. There are many plaftorms already available and in use - IaaS is entering the considerations of many as a viable alternative to traditional enterprise hosted services - and application platforms are only going to continue to grow - Google app engine, SalesForce, SpringSource, Azure etc.


Virtualisation is at the bottom of the elevator with cloud at the ninth! :) if people are using your technology today as their enterprise platform, when you have a new offering for cloud, the decision and, theoretically, the task of transitioning should be easy.


It is safe to say that VMware is currently the top dog in server virtualisation and for most organisations Vsphere/ESX is the enterprise virtualisation platform. Hyper-V is some way behind, being a late entrant but is slowing gaining traction, but is it fast enough for Microsoft and if not how can they accelerate?


First off - Desktop virtualisation is for the most part disruptive to Microsofts revenue model, for Windows and Office in particular - but in order to get enough critical mass and traction, and retention for Hyper-V and the eventual cloud play, Microsoft will play in every game - Yes, it has ceded an early start to VMware in the datacentre, but Microsoft owns every enterprise desktop.


Microsoft are not partnering to chase down VMware in the desktop space - VECD was it used to be, was enough of a blocker to desktop virtualisation as a whole on its own, and the Micosoft standalone capabilities with MDOP, RDS, VDI suite and MED-V was a match for View in most LAN based scenarios anyway - these latest announcements and the reaffirmed alliances give Microsoft and it's chosen partners (Citrix/Quest), the best joint capabilities to serve all use cases LAN, WAN, online and offline, and a diverse menu of choices when it comes to how to deliver to users.


Microsoft is making its moves now to get Hyper-V and Windows 7 really entrenched, protect its revenue models, and remain relevant so that when cloud become viable - Microsoft has a prime seat at the table.


By making simplifying desktop virtualisation licence pricing and crucially building this into software assurance (SA), making real advancements in product capabilties and features (dynamic memory management for the hypervisor and remoteFX), solid strategic alliances, and tying all of this value to Hyper-V and Windows 7 - For many enterprise customers looking at virtualisation - desktop and server - choosing Microsoft and it's strategic partners is easy and cost effective - all the while locking them deeper and deeper in - Its beginning to make sense for many organisations to actually buy into SA - which is exactly what Microsoft want - and it will only get more compelling, with the eventual change to per-user CALs right across the portfolio for Microsoft.


Big brother has joined in the battle - but keep it perspective - this is a war and many battles make up a war - the big prize in this war is supremacy in the cloud and that is what this is all about!  


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Whatever the reason, Microsoft's "seriousness" about VDI is welcome.  Hopefully, next milestones for O/S licensing, as these impact VDI viability, will include:


1.  OEM version of VDA.


2.  VDA tied to user, not device.


3.  Alternate OS licensing, as facilitated by non-Windows Cloud O/Ses.


All very important for VDI capex to be disrupted.


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Don't go reading anything into the XenServer memory over-commit being related to Hyper-V memory overcommit. If you go back and look at the XenSummit archives you will see prototypes and non-Citrix implementations of memory over-commit as far back at late 2007 IIRC. Citrix has had the feature on their road-map since the 5.0 beta days at least. In fact memory balooning for Linux has been there at the command line since before 4.0.


Memory over-commit is a feature that the XenSorce guys really didn't want to put in the product because memory has been trending down, and also because it's easy for people to do dumb things with over-commit. There is an entire class of issues that you don't have to support if you statically assign memory, which is why many ESX shops do it, at least for their critical workloads.


Maybe more important is having folks think that you product has bad performance because it's swapping all the time due to the servers trying to USE all their RAM.


Be careful not to confuse a correlation of parallel features with a causal relationship. MS and Citrix are both enabling over-commit primarily due to market forces to fill a specific set of capabilities that define an "Enterprise Ready" environment that was defined by VMware in the early ESX days and that has continued to evolve as our needs change.


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I have been a big critic of VECD in the past but I honestly dont think that it, alone, slowed down the uptake of VDI deployments. With VDA, are people now rushing in to deploy? Even with the OS now being "free" what about all the other overhead costs? The culmination of these costs is what people are bulking at.


To be honest I don't see this as a bad thing as people are actually looking to the suitable use cases and doing this work up front.


MSFT are in an awkward spot, they need to constantly add value to Software Assurance (as do all software companies). People need to feel that they actually get something for the substantial 3 year commitment in SA. Too often people simply see SA as the vendor fixing problems with their code as well as adding more and more features that I don't use/need to compliment the current features I don't use/need.


Shouldn't they simply add desktop OS's to the Windows Server DataCentre Edition?


Data Centre Edition is certainly one license that is easy to understand, fair and certainly adds significant value for us.


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