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Financial IT shops will rebound with virtual desktops

Gartner cut the number of virtual desktops expected in 2009. When deployments accelerate, delayed early adopters will pick up where they left off.

Before the collapse of the financial industry last year, many leading banks and financial services companies had started to adopt some for the first hosted virtual desktop technology to address security concerns.

Companies with plans still on paper pulled back on their deployments since then. But analysts expect that when this industry does begin recovery, financial services, along with governments and service companies which started leaping onboard with desktop virtualization late in the year, will lead the deployments of hosted virtual desktop adoption.

One consultant, who works directly with some of the largest financial firms in the U.K., said today many of these companies are trying to run as lean an operation as possible. But when the business wishes to launch new products quickly, virtual desktop projects are more easily approved, said Dave Lanagan, senior consultant at Finyx, a consulting firm in London.

"[For financial services organizations] this was a strategic initiative," Lanagan said. In London, where power costs are high, the savings that can be had using Wyse terminals, Sun Microsystems' Sun Ray thin-client terminals or VMWare's View virtual desktop approach, for example, is not inconsiderable, he said.

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  • Gartner Inc. recently released new projections for the hosted virtual desktop market, which is exemplified when an end user with a full client accesses software that runs on a virtual machine on a server that is accessed remotely. There is some brokering of the session to connect users to the desktop and the IT shops uses some tools to manage the provisioning.

    The consulting firm had expected a rapid uptake in hosted virtual desktop usage in 2009 capping at about 1.2 million desktops. But because hosted desktops require a large upfront investment the company now said it believes adoption will only reach 500,000 to 1 million desktops.

    "The slowdown is not due to lack of interest," said Annette Jump, a Gartner research director.

    Gartner also expects hosted virtual desktop adoption to reach 49 million desktops by 2014, up from 500,000 desktops in 2009. So far VMware has led the march in terms of market share with VMware View, but Citrix now offers XenDesktop. Some other vendors with products are RedHat, with its acquisition of Qumranet, and Parallels.

    Lanagan said he participated in an installation of VMware View for about 400 to 500 end users last year. One thing that the employees noticed was that their office wasn't as warm as it had been in the past. The reduction of PCs that generate heat resulted in a significant energy savings.

    But he also cautioned IT shops to not adopt virtual desktops or to outsource, to solve another problem. "Jumping into [virtual desktops] or oursourcing won't fix things overnight," he said.

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