Desktop-as-a-service business model

Business / By / August 5, 2022

Desktop-as-a-service (DaaS) consists of virtual desktop infrastructure (VDI) that is hosted in the cloud and sold to customers on a subscription basis.

Understanding desktop-as-a-service

Desktop-as-a-service is a product that delivers virtual desktops and apps from a public or private cloud service.

Employees can access the service via an app downloaded to a laptop, desktop, smartphone, tablet, or thin client. DaaS can also be accessed in a simple HTML-based web browser with an internet connection.

Desktop-as-a-service access is charged on a subscription basis and is multitenant.

This means that the software and its infrastructure are shared by multiple customers whose data remains isolated and invisible to other tenants.

The virtual desktop infrastructure and machines that run desktop operating systems are hosted by a third-party provider who streams the desktops to the aforementioned devices.

In addition to providing the operating system, these providers also handle VDI deployment, maintenance, data backups, storage, security, and upgrades.

This makes DaaS ideal for companies that want a hands-off on-premise VDI solution.

Why is desktop-as-a-service valuable?

The shift toward remote work now means that employees must be able to access their work irrespective of their location or device.

As we touched on above, many companies also want a passive, simple, and low-cost solution that enables employees to complete their work securely.

Traditional IT environments also come with myriad problems ranging from the simple task of employee password resets to the far more complex data security patches and updates.

When handled internally, these tasks reduce productivity and impact the user experience. 

Desktop-as-a-service also simplifies virtualization initiatives which can often be resource-intensive and require specialized IT skills.

DaaS can function within an operational expense structure and is attractive to clients who prefer the centralization and security of a VDI with another company taking care of basic desktop management.

Desktop-as-a-service providers

Let’s conclude by looking at a few DaaS providers:

  • Amazon WorkSpaces – Amazon launched its DaaS solution in 2013 with customers charged either monthly or hourly on a per-use basis. Customers can opt for either Windows or Linux desktops with a diverse variety of storage configurations and virtual hardware available.
  • Citrix Managed Desktops (CMD) – CMD was released in 2019 as a simplified version of Citrix Virtual Apps and Desktops (CVAD) which required customers to deal with multiple vendors. Citrix offers a virtual Windows desktop which is hosted on Microsoft Azure. Customers can use their own application licenses or have them included in the subscription fee.
  • VMware Horizon Cloud – a DaaS solution that is also hosted by Microsoft Azure. Horizon Cloud promotes itself as the lowest-cost solution for deploying Windows 10 with enterprise-class capabilities. Horizon Cloud can also be deployed on VM Horizon 8 which can be delivered on-premise or via Dell/EMC Cloud, Google Cloud VMware Engine, Azure VMware Solution, or VMC on AWS.

Key takeaways:

  • Desktop-as-a-service (DaaS) consists of virtual desktop infrastructure (VDI) that is hosted in the cloud and sold to customers on a subscription basis.
  • Desktop-as-a-service also simplifies virtualization initiatives which can often be resource-intensive and required specialized IT skills. The popularity of the service has also been helped by the remote work trend.
  • Companies that offer desktop-as-a-service include Amazon, Citrix, and VMware. 

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Other Business Model Types

Asymmetric Business Models

asymmetric-business-models
In an asymmetric business model, the organization doesn’t monetize the user directly, but it leverages the data users provide coupled with technology, thus have a key customer pay to sustain the core asset. For example, Google makes money by leveraging users’ data, combined with its algorithms sold to advertisers for visibility.

Attention Merchant Business Model

attention-business-models-compared
In an asymmetric business model, the organization doesn’t monetize the user directly, but it leverages the data users provide coupled with technology, thus having a key customer pay to sustain the core asset. For example, Google makes money by leveraging users’ data, combined with its algorithms sold to advertisers for visibility. This is how attention merchants make monetize their business models.

Marketplace Business Models

marketplace-business-models
A marketplace is a platform where buyers and sellers interact and transact. The platform acts as a marketplace that will generate revenues in fees from one or all the parties involved in the transaction. Usually, marketplaces can be classified in several ways, like those selling services vs. products or those connecting buyers and sellers at B2B, B2C, or C2C level. And those marketplaces connecting two core players, or more.

Wholesale Business Model

wholesale-business-model
The wholesale model is a selling model where wholesalers sell their products in bulk to a retailer at a discounted price. The retailer then on-sells the products to consumers at a higher price. In the wholesale model, a wholesaler sells products in bulk to retail outlets for onward sale. Occasionally, the wholesaler sells direct to the consumer, with supermarket giant Costco the most obvious example.

Retail Business Model

retail-business-model
A retail business model follows a direct-to-consumer approach, also called B2C, where the company sells directly to final customers a processed/finished product. This implies a business model that is mostly local-based, it carries higher margins, but also higher costs and distribution risks.

B2B2C

b2b2c-business-model
A B2B2C is a particular kind of business model where a company, rather than accessing the consumer market directly, it does that via another business. Yet the final consumers will recognize the brand or the service provided by the B2B2C. The company offering the service might gain direct access to consumers over time.

Crowdsourcing Business Model

crowdsourcing
The term “crowdsourcing” was first coined by Wired Magazine editor Jeff Howe in a 2006 article titled Rise of Crowdsourcing. Though the practice has existed in some form or another for centuries, it rose to prominence when eCommerce, social media, and smartphone culture began to emerge. Crowdsourcing is the act of obtaining knowledge, goods, services, or opinions from a group of people. These people submit information via social media, smartphone apps, or dedicated crowdsourcing platforms.

Open-Core Business Model

open-core
While the term has been coined by Andrew Lampitt, open-core is an evolution of open-source. Where a core part of the software/platform is offered for free, while on top of it are built premium features or add-ons, which get monetized by the corporation who developed the software/platform. An example of the GitLab open core model, where the hosted service is free and open, while the software is closed.

Open Source vs. Freemium

open-source-business-model
Open source is licensed and usually developed and maintained by a community of independent developers. While the freemium is developed in-house. Thus the freemium give the company that developed it, full control over its distribution. In an open-source model, the for-profit company has to distribute its premium version per its open-source licensing model.

Freemium Business Model

freemium-business-model
The freemium – unless the whole organization is aligned around it – is a growth strategy rather than a business model. A free service is provided to a majority of users, while a small percentage of those users convert into paying customers through the sales funnel. Free users will help spread the brand through word of mouth.

Freeterprise Business Model

freeterprise-business-model
A freeterprise is a combination of free and enterprise where free professional accounts are driven into the funnel through the free product. As the opportunity is identified the company assigns the free account to a salesperson within the organization (inside sales or fields sales) to convert that into a B2B/enterprise account.

Franchising Business Model

franchained-business-model
In a franchained business model (a short-term chain, long-term franchise) model, the company deliberately launched its operations by keeping tight ownership on the main assets, while those are established, thus choosing a chain model. Once operations are running and established, the company divests its ownership and opts instead for a franchising model.

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