When Nerdio Chief Revenue Officer Joseph Landes visited London last month Technology Reseller took the opportunity to catch up with him and find out more about the company, how its products can help MSPs build successful cloud practices in Microsoft Azure and why he thinks we’re at the beginning of a huge transformation in the virtual desktop space
For most businesses, launching a major new product on March 19, 2020 would have been unfortunate, perhaps catastrophic. For Nerdio, which enables Managed Service Providers (MSPs) to build successful cloud practices in Microsoft Azure, the launch of Nerdio Manager for Enterprise right at the start of the pandemic was a case of perfect timing.
The establishment of this new enterprise-focused part of the business, set up to help end user organisations move to virtual desktops with native Azure Virtual Desktop (formerly called Windows Virtual Desktop) or Windows 365, gained massive impetus from the shift to remote working and enabled Nerdio very quickly to build a large enterprise business alongside its original multi-tenant offering for MSPs.
“We launched Nerdio Manager for Enterprise on March 19, 2020 when suddenly every company in the world needed a remote work solution,” explains Nerdio Chief Revenue Officer Joseph Landes.
“The business case for Azure Virtual Desktop (AVD) was very much accentuated by the pandemic. At its base level, AVD allows you to stream your desktop from the Microsoft Azure cloud onto any device you have, anywhere you are, and that’s a pretty incredible value proposition. We had a customer in the US that ran a call centre and when a few employees became sick, they had to send everybody home – about 100 employees. They couldn’t tell everyone to take their desktops home on the bus and train – that just wasn’t practical. But what they were able to do was deploy Azure Virtual Desktop.
“Employees were sent an email and when they got home, they opened it, clicked on the link and, from any device, they were now able to access their unique desktop, their applications, their profile. It was as if they were sitting at their desk in the call centre. That’s the significant value proposition of virtual desktops in general.
“What makes AVD unique, relative to other virtual desktop technologies, is that it’s Microsoft-centric. If you’re using Office 365, it’s a very natural bridge to be able to use Microsoft’s virtual desktop technology as well. That’s why, since Microsoft launched Windows Virtual Desktop in October 2019, we’ve seen it really accelerate.”
That growth is reflected in the take up of Nerdio’s own products.
“We announced at our recent NerdioCon user conference that we had passed 2 million users under management of Nerdio Manager products. It took us about two years to get to 1 million users and about five months to get the next million users. So growth has been exponential – and we don’t see it slowing down at all.”
Incubated by MSPs
Nerdio was set up in 2016 to productise and sell technologies that CEO Vadim Vladimirskiy had developed to optimise
and manage clients at US MSP practice, Adar, which he had set up in 2005
with the aim of moving every one of his customers to virtual desktops.
“In 2018 we launched our first product, Nerdio for Azure, a multi-tenant management product for MSPs looking to move to the cloud with Azure. That very quickly evolved into the two sides of our business that make up Nerdio today.
“We have an MSP business that is led by a product called Nerdio Manager
for MSP, a multi-tenant deployment management and optimisation platform for MSPs that are looking to move to the cloud with Azure and specifically use either Azure Virtual Desktop (AVD) or Windows 365.
“And we have an enterprise side of our business with Nerdio Manager for Enterprise, an Azure application that assists IT professionals with deploying, managing and optimising an AVD or Windows 365 environment (see box on page 40). The customer base for our enterprise product covers a wide range of organisations, from a healthcare organisation in New Zealand that has about 200 users to a school in Australia that has about 40,000 users. We call it ‘enterprise’ to differentiate it from the MSP side of our business, which addresses the needs of small and medium- sized businesses.”
Nerdio helps MSPs and enterprises maximise the benefits of moving to Azure by combining significant efficiencies in the deployment and day-to-day management of virtual desktops with massive cost savings of as much as 80% compared to non-optimised environments.
“We have a lot of different pieces to our product, but the one that really stands out, I would say, is our ability to save people money on the cost of running Azure, on the cost of their Azure infrastructure and on the cost of Azure compute and storage specifically,” explains Landes.
“Our auto scaling engine allows a customer to do a number of things, for example turn on and turn off virtual machines when they’re not being used. Imagine you’re an MSP and you have a 20- user doctor’s surgery and you know that at 7 p.m. every night the doctors and nurses and staff go home and don’t come back in again until 8 a.m. the following morning. Wouldn’t it be great if the system was intelligent enough to power down all those desktops at 7 O’clock so the meters don’t continue to spin in Azure? And wouldn’t it be great if the technology knew to turn those desktops back on the next morning so that when people come in at 8 O’clock they are ready to go.
“That’s the basic concept of auto scaling, but we go much further than just turning on and off resources. We will change the type of storage that you have, so in the off-hours you don’t pay for premium storage but use standard storage, and there are many other optimisations that together can result in a customer or partner saving 60% to 80% on the cost of running Azure.
“One of the biggest challenges customers and partners face, certainly in the MSP space, is the cost of running Azure. When we go into an MSP and tell them we’re going to save them 60% to 80% on the cost of running their customers on Azure, their ears prick up and their eyes open wide and they say ‘Wow, I didn’t know that was even possible. In fact, that’s what’s been stopping me from moving to Azure in the first place’.”
Landes cites a study of a 192-user environment, which shows that going to Microsoft’s portal and deploying Azure Virtual Desktops for those 192 users in an unoptimised way costs about $26 per user, per month, but just $4.54 per user, per month if you use Nerdio auto scaling technology.
“Saving around 80% per user, per month is a tremendous amount of money. Then, when you compare that to using Citrix or VMware which is just not able
to do that, it’s a no brainer. Why would somebody want to pay $25, $50 per user, per month when you can pay $4.54?”
Nerdio’s other major benefits are:
- simpler day-to-day management of clients, epitomised by the concept of ‘three click management’, a belief that you should be able to do every task in Azure in no more than three clicks. Greater automation and the ability to manage all clients in a single pane of glass admin portal can significantly reduce help desk requirements and enable organisations to redeploy more expensive experienced technicians to higher value work; and
- the ability to provision a complete AVD environment in less than an hour or connect to an existing deployment in minutes. “For an MSP who has never done anything in Azure before, it’s going to take two, three or four weeks of education and consulting to get a customer up and running. With Nerdio, they can deploy that customer automatically in 60 minutes or less without the need to hire a very expensive Azure engineer,” explains Landes.
Nerdio is a channel-first company and
in the UK has several partners on the enterprise side and many more on the MSP side that are using Nerdio Manager to help build a more efficient AVD practice and make monthly recurring revenue from selling subscription-based cloud services.
Landes says that Nerdio is particularly looking for IT system integrators with significant virtual desktop experience that have become dissatisfied with Citrix or VMware and would like to build an AVD practice instead.
“A lot of partners around the world have grown up in the VDI space with the legacy providers, with Citrix and VMware, and the moves those companies have made and the slower technology adoption they have had are causing partners to rethink their relationships with them and causing them to think about building a native AVD practice with Microsoft.”
Landes says there are a couple of reasons why they might want to do this.
“First of all, when these organisations bet on VDI in the past, solutions were very proprietary and locked organisations into a way of doing things, whereas today a lot of end user customers and even the partners that serve them want to use native technology as much as possible. And that’s what Microsoft allows them to do.
“However, they also want Microsoft technology to give them the same functionality they’re used to. And that’s where Nerdio comes in. We build on top of the AVD technology with all the enterprise functionality that partners are used to.
“The second reason is those legacy solutions are much more expensive. With Citrix or VMware, you’re talking about tens of pounds per user per month, £30, £40, £50 per user, per month. With Azure Virtual Desktop, you’re talking about £3, £4 per user, per month. Those savings are causing customers to question why they are using legacy technology when they could use something that’s just as good, if not better: it’s native; you don’t need anything proprietary; there’s no lock-in; and it’s significantly less expensive.”
He adds that AVD also overcomes inefficiencies and complications that used to exist around using virtual desktops in the Windows world.
“When it was brought out in October 2019, Windows Virtual Desktop had a lot of capabilities that made it much easier for customers and partners to move to the cloud in a more efficient way. Before, most people who were in the Windows world and wanted to do virtual desktops had to use a technology called RDS, Remote Desktop Services. RDS was a much more complicated technology. The underlying operating system was a server-based technology; you were actually running Windows Server that was skinned to look like a desktop. The licensing was incredibly complex – you had RDS CALs, Client Access Licences; you had to license different servers; you had this thing called Shared Computer Activation.
“Then Microsoft came out with AVD and basically said ‘Look, you can use AVD as long as you have an entitlement to Windows 10 Enterprise’. All of a sudden, from a licensing standpoint, you had many fewer pieces in the mix. And it was based on the Windows client operating system, not Windows Server, which brought with it many other efficiencies because an application that was written for Windows Client would now work in Azure Virtual Desktop, whereas before the application had to be written for a server and then translated into a client, which was sometimes messy for application compatibility.”
These benefits are increasing demand for AVD and associated products, filling Landes with confidence about future opportunities for Nerdio and its partners in the UK and elsewhere.
“I really feel we’re at the beginning of a huge transformation in the virtual desktop space. If you think about the number of Windows PCs that are out there, I don’t know what the official count is but let’s call it 2 billion, only a small, small, small number of those are virtualised and that represents a huge opportunity for us at Nerdio and for other companies that are out there building technology on top of Microsoft. So, we’re very excited to be taking a leadership position in this desktop virtualisation world and look forward to spending more time with partners in the UK, educating them and exciting them around Nerdio and AVD and Windows 365.”
Windows 365 or AVD?
In addition to native AVD environments, Nerdio products also manage Windows 365 Cloud PC, which Microsoft introduced in July 2021 as a way for more people to experience a virtual desktop environment, as Landes explains
“When Microsoft was working on developing Windows 365, they came to us and said we would like you to build this into your products. So we did. Now, when you use Nerdio Manager, whether on the MSP side or the enterprise side, you can deploy and manage either Azure Virtual Desktop or Windows 365.
“Ultimately, we expect to see customers or partners using both depending on the use case. You might have a customer estate that primarily uses AVD, but has a few departments that use Windows 365, maybe because they are task workers or have fewer needs than other users. So we created our product in a way that allows an MSP or an enterprise IT professional to manage both. We support both technologies and we think both will continue to be adopted quite rapidly.”
Landes adds that the choice of whether to use Windows 365 or Azure Virtual Desktop comes down to a few factors that an MSP or an enterprise will need to consider.
“Think of Windows 365 as a fully packaged service and AVD as more of a DIY service. Windows 365 is a service run by Microsoft that you pay in the same way as Office 365. You check a box, you say I would like to purchase 20 Cloud PCs, you purchase them for the whole month, your desktop runs in the cloud for 30 days, and your users have the right to use it for 30 days. Then each month it automatically renews unless you decide to get rid of it.
“Azure Virtual Desktop doesn’t work like. Azure Virtual Desktop is a technology that you build on top, and if you have users who don’t want to use it at any point you just turn them off, they stop using it and you don’t pay for the consumption.
“Another big difference is that with Azure Virtual Desktop you’re paying per user for compute and storage based on consumption, whereas with Windows 365 you’re paying a flat fee each month, with different SKUs based on the power of the desktop.”