Businesses Take Another Look at Virtual Desktops

More Companies Test Alternative to PCs as Software Develops, but Predictions of Revolution Haven't Materialized
By WILLIAM M. BULKELEY

As companies look for new ways to squeeze costs out of their technology budgets, some are deciding that the next PC they purchase need not be a PC at all.

Instead, they are rolling out virtual desktops -- a set-up consisting of a screen, keyboard and small connector box that ties into a powerful server in the computer room that has all the software, storage and processing capabilities that each desktop user needs.

Maryland Auto Insurance Fund, an insurance company in Annapolis, Md., says it plans to replace at least two-thirds of its 600 user desktops within 18 months with virtual PCs.

Cindy Warkentin, the company's chief information officer, estimates that the move will save costs by allowing the company to replace fewer PCs every year.

The virtual PCs also allow her IT staff to centrally install software updates in a few minutes instead of working for several hours over the weekend.

The so-called thin-client revolution has been touted before, but has so far failed to arrive. At last count about 633 million desktop PCs were humming in offices around the globe, according to technology watchers at Gartner.

Gartner and other analysts say improved virtualization software for the desktop, the rising cost of maintaining PCs and demands for more security and regulatory accountability are all making conditions ripe for virtual PCs.

Gartner says the number of virtual desktops doubled in the last year to about 600,000. It predicts that over the next five years, 15% of current PCs will be replaced by virtual desktops.

Virtual desktops, which cost from $200 to $1,000 per user, lower the cost of operating and supporting PC networks by eliminating most deskside visits by technicians, while reducing viruses and security violations, vendors and analysts say.

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