Wyse explores the boundaries of cloud computing with new Cloud PCs

Wyse Technology has announced a new computing platform designed to capitalize on the growing market for cloud hosted virtual desktop environments that has the potential to un-jam one of the most emotive roadblocks towards the widespread adoption of desktop virtualization. Announced at Microsoft’s Tech Ed conference in Berlin, the Wyse Cloud PC presents an intriguing twist in the junction between desktop virtualization and thin client technologies that gets right to the heart of many IT professionals opposition to desktop virtualization.

There are few real differences between the new Cloud PC models and Wyse’s current range of thin and zero clients devices. It takes some close inspection of the hardware specification for each model to be able to identify a Wyse Cloud PC from a more conventional Wyse thin client.  However there is one very significant difference; each Cloud PC ships with a Windows 7 license.  The inclusion of a full Windows 7 license gives customers the option to take out a Software Assurance agreement for their Cloud PCs; this grants the customer the right to access a server hosted virtual desktop without the need to purchase additional Microsoft Windows Virtual Desktop Access (VDA) licenses.

Microsoft has long struggled to gain acceptance for its desktop virtualization licensing programs. Microsoft introduced Windows VDA licensing in July 2010 to replace the less than popular Windows Virtual Enterprise Centralized Desktop (VECD) licensing scheme.  While Windows VDA offered significantly better terms, at a lower price, than VECD licensing it has still received significant criticism and has been unable to dislodge its linkage with the phrase “desktop virtualization tax” that became synonymous with VECD licensing.  There are few significant differences between VDA licensing and Microsoft’s subscription advantage (SA) scheme, mindful of this and of the relative lack of hostility towards the subscription advantage program, Wyse’s decision to license its thin clients as Windows PCs has created an inventive way to bypass the negative associations held again VECD and VDA licensing, even if Wyse has chosen not to call attention to this fact in its marketing collateral. Wyse’s official position is that the Wyse Cloud PC is a full-blown PC that just happens to look remarkably similar to a thin client.  Indeed David Angwin (Wyse Director of Marketing for EMEA) justified new product naming by claiming “We’re using the term ‘Cloud PC’ because, when you stream the OS and applications over the network, they are running locally on the device. It is essentially a PC, but provisioned and managed from the cloud”. The marketing material that accompanied the Cloud PC launch, claims “Wyse Cloud PCs are like legacy PCs, but use a private cloud to store your software and content. They work with desktop, mobile, existing, or new hardware”.  Which may be technically accurate but does little to explain why Wyse’s entry-level C10LE thin client has the same VIA C7 processor as does the C00LE Cloud PC both running at a rather languid 1 GHz.  Admittedly the Cloud PC has twice the memory as the thin client, but that still leaves the Cloud PC with a paltry 1 GB of DDR2 memory, which while adequate to boot a copy of Windows 7 doesn’t leave much room to run anything. The reality of the situation is that most, if not all, Wyse Cloud PCs will function purely as thin client devices.

Accepting the obvious marketing ploy of the re-branding of a bundled package of thin client and Windows 7 license as a “cloud” device, the Wyse Cloud PC is an intelligent and pragmatic means of addressing IT decision-makers dissatisfaction with Microsoft’s desktop virtualization licensing policies.  Wyse Cloud PCs will give Wyse a substantial advantage over its competitors, but given that the Cloud PC is no more than an intelligent combination of existing technology, third-party product licensing and fancy footwork by Wyse’s marketing team, it will not be difficult for other thin client vendors to emulate Wyse and launch their own Cloud PC equivalents. Wyse should not therefore expect to see much long-term advantage accrue from this most recent initiative.

It will be interesting to see how Microsoft responds to this measure.  Although Microsoft is likely to see some reduction in revenue from this innovation due to the lower cost of subscription advantage compared to a VDA license (the precise difference will vary depending on the negotiating power of individual organizations), this by itself is unlikely to spur any further changes.  However the further confusion that this innovation will bring to the marketplace will do Microsoft no good at all, and Microsoft may find it necessary to adjust product licensing terms or pricing to restore the balance if it sees widespread adoption of “cloud PCs”.

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