tuCloud criticizes Microsoft, OnLive for virtual desktop licensing debacle

tuCloud releases cloud-hosted virtual desktop tool to capitalize on OnLive’s licensing clash with Microsoft

Less than a week after Microsoft put its foot down on OnLive’s virtual desktop solution for allegedly violating its licensing standards, tuCloud capitalized by releasing its own product, taking a few jabs at both OnLive and Microsoft in the process.

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BACKGROUND: Microsoft Drops the Hammer on OnLive’s iPad Offering
In a press release titled “tuCloud publicly challenges OnLive with new cloud desktop platform,” the hosted virtual desktop provider announced its Desktops On Demand service, called Microsoft “patronizing and insulting,” and even made a comment on the decision of OnLive, known as a cloud gaming company, to enter the virtual desktop market. [See “OnLive Desktop brings you one step closer to ditching your notebook for the iPad”]

“Not only will we deliver a $10 hosted virtual desktop that creatively interprets Microsoft’s licensing rules in order to compete with OnLive, we will also provide our customers with 24/7 California-based tech support,” tuCloud CEO Guise Bule says. “We don’t play games, we do desktops.”

OnLive had initially drawn significant attention after introducing its Desktop and Desktop Plus services at the Consumer Electronics Show in January, and later claimed that its product’s entertainment capabilities surpassed those of competing products when used on an iPad. Later, in a report released in late February, Gartner analysts warned enterprise customers of licensing risks with OnLive’s products. Slightly more than a week later, Microsoft corporate vice president of Worldwide Licensing and Pricing, Joe Matz, responded with a company blog post that implied OnLive Desktop and Desktop Plus were not properly licensed.

With all the media attention surrounding the issue, tuCloud hasn’t been the only one to publicly comment on OnLive’s situation. Citrix senior director for product marketing, Calvin Hsu, in a company blog post titled “Thank you, OnLive Desktop. Thank you,” cited OnLive co-founder and CEO Steve Perlman’s criticism of Citrix’s virtual desktop solution, and thanked the company for drumming up media attention around Citrix’s product just before suffering such a setback.

“Thank you, OnLive, for creating media attention for 1,500+ CSPs that were doing cloud desktops before you, better than you, and in compliance with the rules,” Hsu wrote in a Citrix blog post. “Thank you for raising enough controversy to get Microsoft to reaffirm that you’re doing the licensing wrong, and our CSPs are doing it right. Thank you.”

Danny Allan, CTO of Desktone, tuCloud’s partner in Desktops On Demand, reiterated the benefits of OnLive’s licensing situation for raising awareness of not only the growing demand for virtual desktop solutions, but also the challenges of licensing virtual products.

Awareness of Microsoft’s complex licensing structure is important because it has impacted the market as a whole, Allan says. Microsoft licensing challenges have long driven up the cost for virtual desktop services, while also slowing down development for providers looking to release a new service without ending up in the same position as OnLive, Allan says.

Bule, while touting tuCloud’s Desktops On Demand, made sure to help raise awareness of these challenges as well.

“OnLive blatantly flouts the rules, continues to sell their cloud-hosted Windows 7 desktops, and all Joe Matz does is write a deeply patronizing and insulting blog post. This is slap round the face of the entire desktop virtualization industry,” Bule says. “We will no longer sit idle and stay silent whilst being denied the chance to compete fairly. Microsoft licensing hurts our customers, our businesses and the entire virtual desktop space.”

Allan, who says the market for cloud-hosted virtual desktop tools reached a turning point in the last nine months as a result for growing demand for mobility, believes Microsoft’s licensing standards should adapt accordingly. Until that happens, however, the industry will need to play by Microsoft’s rules.

“With the demand increase and the acceleration of that moving forward, should the licensing change? The answer to that in my mind is ‘absolutely yes,'” Allan says. “But that’s for Microsoft to change, not for tuCloud to ignore.”