Virtual reality

Virtual reality

Moving servers to the brave new world of virtualisation was a no-brainer for information chiefs. But the next challenge is doing the same thing for the desktop.

Virtualising your servers saved you money. There was no question about that. Organisations that moved to virtualised environments reduced their footprint and shrank energy bills, while also enjoying a reduction in maintenance and management requirements. But the players that took servers into the brave new world of virtualisation are finding it a lot harder to justify the same model for desktops on the same monetary basis.

Where virtual servers offered upfront savings, virtual desk-tops come with the appealing but not imperative promise of improved data security, scalability and an extension of the hardware life cycle.

On the downside, setting up a virtual desktop environment requires a lot of capital expenditure, which makes selling the concept at board level much more challenging, especially during difficult market conditions.

A recent Gartner study comparing the market for virtualised desktops in the Asia-Pacific region showed 28 per cent of large enterprises and 33 per cent of mid-sized companies in Australia have already implemented virtualised desktop infrastructure (VDI), with mid-sized companies rating VDI their top priority for 2010, even above software as a service.

However, compared with the total cost of ownership of more traditional PC deployments, a VDI deployment was estimated to be only between 2 per cent and 10 per cent lower. Even then, a large part of that cost saving is down to the mitigation of labour and downtime costs inherent in traditional PC fleets and considerably lower in thin client deployments.

Senior analyst at advisory firm IDC Jean-Marc Annonier says the upfront costs can be very high once hardware acquisitions are taken into account.

"You not only need to buy the thin clients," he explains, "you also need to buy the servers, and those machines are very expensive. They need to be highly scalable.

"According to the latest numbers from Citrix, for example, you're looking at 125 virtual desktops per server. That's a high number and reduces the cost per virtual machine, but at the same time the unit cost of those [back-end] machines is growing because they're so powerful."

He also notes that the investment in storage systems is significant because even if it is well managed, the overall storage needed to deploy a large-scale virtual desktop solution is huge.

"Imagine you have 5000 concurrent users at midday in your organisation, and you need 15 to 20 gigabytes per user - you will need to have that capacity in your storage, which is an enormous number when you think of it in terms of a storage area network.

"Basic storage might not cost much, but high-end systems - SAN [storage area network] or even NAS [network attached storage] boxes - are very expensive."

Rapid growth

Even so, Gartner predicts the desktop virtualisation software market will grow at a compound annual growth rate of 84 per cent from 2008 through 2013, from $US38 million ($41.4 million) to $US795 million worldwide.

The nascent HVD software market stood at $38 million in 2008 and will grow to more than $795 million by 2013, driven by adoption in the enterprise as organisations seek to centralise management and improve data security.

But firms prepared to look beyond the upfront cost to long-term benefits might still find that virtualising the desktop environment is the right way to go.

Annonier says the finance sector has been an early adopter of VDI because of the nature of the business: large numbers of employees accessing potentially sensitive information over applications that do not require a lot of processing power.

Brad Aurisch, general manager for technology at financial services company Perpetual, says the poverty of existing systems made the transition particularly attractive to his company.

"The immediate savings came in terms of maintenance costs and boosting satisfaction," he says.

"We have a highly distributed operation and we used to get weekly complaints about performance from our branch offices."

Aurisch says the need to replace existing systems that were getting long in the tooth within its branch network was also a driver because thin clients cost less than PCs and last longer. "In order to service our branch offices the way we wanted to, it would have been hundreds of thousands of dollars more expensive," he says, "so we've also seen that saving click in straight away."

The company's acquisitive growth strategy delivered rapid expansion across its regional branches - growth that Aurisch says could not have been appropriately accommodated without a virtualised solution.

"Our way of delivering technology to the branch offices was to establish mini HQ file servers, note servers and so forth," he says. "It was getting tremendously expensive to maintain as well as difficult and slow for us to stand up new premises."

When Perpetual began its desktop virtualisation project 18 months ago, the goal was to bring 280 branch employees onto a virtualised system with a view to integrating the main office over the next year or so.

However, the addition of branch staff and offices, driven by acquisitions, has meant a total of 560 employees are now connected via VDI.

"Getting to 560 was great," Aurisch says. "We never anticipated that level of take-up, but it was vital to take on our new staff and footprint."

He says the ability to rapidly scale a virtualised network has made all the difference in facilitating the organisation's rapid growth. "No one really believed it would be quite so successful," he says.

"If we'd stuck with the 'full IT infrastructure per branch office' model, we simply wouldn't have been able to commission the offices and roll out the volume of desks that we have been able to respond to.

"Particularly over the past seven months, it just would not have been possible to achieve."

While VDI has been instrumental in integrating new acquisitions into the organisation, Aurisch says it has also made these new employees feel connected to the greater company.

"The very first thing is to make the new employees feel like they're part of the company," he says.

"We can now give them access to our risk control, HR systems, finance systems, the intranet, our communications systems - all of that kind of stuff - instantly through the VDI."

Gradual move

Aurisch says Perpetual's head office in Sydney will move onto VDI gradually during the next year or two as current desktop hardware needs to be replaced.

"The thin client infrastructure has a life cycle of over five years, compared with three for a standard desktop, so you have those savings, too," Aurisch says. "It is ultimately cheaper."

RAMS Home Loans' head of IT, Mark Austin, says the home lender has used a virtualised desktop product to get around the problem of fragmented operating systems.

"We had desktops, laptops, a variety of operating systems and a variety of different application versions, so we saw virtualising as a way of consolidating our licensing position within a virtual environment," he says.

"Second, we reduced our costs in terms of managing the environment. We had a decentralised management system with people actually going around to desks to fix individual problems."

Austin says that by moving onto VDI, the organisation has managed to centralise maintenance and provide consistency company wide.

"It has made a massive difference in terms of the moves, adds and changes as well," he says. "Everyone is completely mobile - they can walk around to any desk and it works."

Austin says another advantage is that the organisation has gained tighter control over the location of its information.

"Security was a plus, although not a huge concern for us here," he says. "We were much more focused on controlling where data was being stored. We can now keep a much tighter control on that because local drive storage has disappeared as an option."

RAMS undertook its server and desktop virtualisations in parallel.

The organisation replicated its system in the new environment and performed rigorous testing, achieving performance roughly tenfold the pre-existing system before switching it all over in one weekend.

"Nobody knew about it. No one noticed," Austin says. "That is the hallmark of a good virtualisation implementation - it has to be seamless."

While RAMS had not expected to save money upfront, it had considered retaining its old hardware to mitigate the immediate capital expenditure demands of the deployment. But, in the end, Austin says it opted to buy in completely new thin clients.

He says support cost savings - between 30 per cent and 40 per cent - would mean the capex was recouped within three years.

IDC estimates that about 500,000 computers are retired each year in Australia. Annonier says at least 50,000 of those will be replaced by virtual thin client desktops in 2010. MIS Australia

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Tags cloud computingCIO roleGartnervirtualisationIDCdesktop virtualisationeconomic crisisanalystTech trendsnew technologiestech investments

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