Is it time to reconsider DaaS?

January 29, 2026 Yanac

Desktop as a Service (DaaS) has made some radical strides and improvements in recent years, making it a more compelling alternative to Virtual Desktop Infrastructure (VDI) — and to traditional PC deployment and management.

DaaS is a cloud-based offering where a provider hosts virtual desktops and streams them over the internet to users’ devices, delivering a complete desktop environment that includes the operating system, apps, files, and user settings from remote cloud servers instead of running them on local PCs.

That sounds an awful lot like VDI, but there are considerable differences. VDI is hosted in a company’s own data center, while DaaS is hosted in the cloud service provider’s data center. With VDI, it’s up to the customer to buy, deploy, and manage the infrastructure and provide the operating environment. With DaaS, the hosting, hardware, and software environment are all managed by the CSP. That translates to a lot less work for the customer.

And Gartner sees a bright future for DaaS. In its recently released 2025 Magic Quadrant for Desktop as a Service report, the analyst firm predicted that by 2027, virtual desktops will be cost-effective for 95% of workers, compared to 40% in 2019, and in the same time frame, virtual desktops will be used as the primary workspace for 20% of workers, up from 10% in 2019.

Sunil Jason Kumar, a senior director and analyst with Gartner who co-authored the study, attributes this shift to improved offerings from CSPs. “A lot of the vendors are taking care of the management, so there’s less for the organization to have to do. You don’t need the high level of skill set that you needed in the past to get a virtual desktop environment up and running. That helps a lot,” he said.

Bye bye, VDI

Gartner forecasts DaaS spending to grow from $4.3 billion in 2025 to $6.0 billion by 2029, a 7.9% compound annual growth rate. The VDI market is shrinking as customers migrate on-premises workloads to DaaS, Kumar said.

“Gartner rarely speaks to an organization that is planning to deploy a new on-premises VDI solution,” the report stated. “Net-new deployments are almost exclusively using DaaS, and on-premises deployments are either migrating to DaaS or moving to a cloud control plane, except for a few land-locked use cases.”

Simplified deployment, management, and costs are key to DaaS’ appeal:

For vendor-assembled and vendor-managed virtual desktops, the DaaS vendor is responsible for the delivery of the virtual desktop. With VDI, the customer is responsible for making sure that their users can connect to virtual desktops.

With vendor-assembled and vendor-managed DaaS, organizations typically pay a fixed cost per user per month rather than a consumption-based cost. This makes management simpler and cheaper.

VDI requires a virtualized server infrastructure. This was often handled by a different team than the end-user services / digital workplace team. DaaS solutions do not require this since the workloads are in the public cloud.

Finally, most outsourced virtual desktop solutions were previously customized for each client. With vendor-managed DaaS, there are now scalable multi-tenant solutions where customers can offload most of the virtual desktop management to the vendor without having high up-front costs and commitments for a custom-built solution.

But Gartner is not predicting the outright demise of VDI. There are still a good number of organizations that have an on-premises environment, and some are reluctant to change from VDI to DaaS.

“If anybody is going to be a holdout, it’s going to be more security-conscious type organizations,” Kumar said. “But I’m seeing more and more organizations adopt the cloud, and it’s just become more commonplace,” whereas “in the past there was some resistance.”

Considering TCO

For companies deciding between traditional PC purchases and DaaS, a core consideration is total cost of ownership. One factor that may tip the balance in favor of DaaS for some IT buyers nowadays is the inclusion of analytics and automation tools. With end-user services like DaaS, digital employee experience (DEX) tools are commonly deployed to perform analytics, automation, and self-healing for employee devices.

Gartner estimates that the TCO of a laptop with no analytics or self-healing tools (in a typical laptop deployment) to be around $2,440 per device per year, while a laptop with analytics and self-healing tools (offered by the DaaS provider) has an annual TCO of $1,936.

With automated support and self-healing, that means less human interference is needed. And because DaaS is provided and hosted by a third party, that’s an expense the customer does not have to endure. Microsoft — or another DaaS provider — is managing, repairing, and upgrading your desktops so you don’t have to.

Microsoft has two main DaaS offerings. First is Azure Virtual Desktop (AVD), the lower-cost self-assembled DaaS offering first introduced in 2019. It offers a consumption model without virtual desktop software licenses, so costs are infrastructure related, such as for compute, storage, and networking.

Second is Windows 365, a vendor-assembled DaaS offering that offloads some of the virtual desktop management, including the delivery of the virtual desktop. Windows 365 runs in Microsoft’s tenant rather than the customer tenant, making it easier to get up and running for organizations that do not already have a presence in Azure.

Other leading DaaS vendors include AWS, which offers Amazon WorkSpaces; Omnissa (formerly VMware EUC) with Omnissa Horizon, and Citrix, which has both VDI and DaaS offerings. Google Cloud is focused on virtual apps rather than virtual desktops, Kumar said.

Golden opportunity

Going into 2026, there has never been a better opportunity for DaaS to gain significant ground. A major PC refresh cycle is predicted to take place, for a few reasons. Many laptops deployed during the COVID lockdown are now five years old and coming off warranty. And Microsoft has ended support for Windows 10, which will also drive upgrades of older machines.

DaaS is also getting a boost as more companies hire people globally, says Dvir Shapira, chief product officer for Venn, which makes secure workspace software for remote users. That includes Venn itself. “We’re hiring people in in Eastern Europe, in South America. There’s great talent [there], and it’s much more cost effective [to use DaaS],” he said.

In most organizations, of course, DaaS is not an all-or-nothing strategy. The question is which users should move to DaaS and which should remain on traditional desktops and notebooks.

Kevin Greenway, CTO at 10ZiG Technology, which specializes in thin-client and no-client endpoints, says it can vary from company to company, as well as by sector/vertical. Common practice is to select a combination of the most complex or “noisy” users (those who are open to providing feedback/complaints) and users who work at a specific location or within a specific department to pilot DaaS, he said.

These are typically made up of knowledge workers who require office and productivity applications, including communication and collaboration apps like Microsoft Teams, Zoom, or Cisco Webex.

Venn’s Shapira said DaaS is rolled out selectively in most organizations, with the first to receive it generally the users with the most leverage or visibility. “Executives and other high-priority roles often get access to multiple endpoint options, whether a company-issued device or a personal device with DaaS, because their productivity needs tend to carry more weight,” he said.

Then deployment usually expands to teams handling sensitive data, such as developers working with personally identifiable information (PII), followed by geographically distributed groups or offshore teams that benefit from standardized access. Employment status also factors in. For example, full-time employees are typically covered earlier than contractors, said Shapira.

Users who typically wouldn’t get a DaaS setup include those with requirements for offline capability, those who work in remote locations with unreliable connectivity, any roles with low latency requirements, and users with heavily complex display requirements, said Gartner’s Kumar.

The AI factor

AI is permeating every sector of technology, and user devices are no exception. Greenway is bullish on the role of AI in a DaaS environment. “AI is geared around data center models, and that’s essentially what DaaS is — workloads are running on cloud-based data centers already equipped with Nvidia GPUs,” he said.

Gartner hasn’t seen AI have much of an impact on virtual desktops so far, according to Kumar. “Essentially, no, it is not having an impact,” he said. “It certainly may in the future.”

Shapira said the arrival of AI is driving the need for greater desktop control. “The workforce is changing because of AI,” he said. “I don’t think there are any developers right now who are not using AI in their development process, so AI is now touching your code base. It introduces another level of risk, and I think that is something that is definitely going to drive people towards environments like DaaS or VDI, because IT is losing more and more control over where their data is going.”

Kumar said if there is a challenger to DaaS, it’s cloud-based apps like those offered with Microsoft 365. IT may decide to make it very easy to manage its Windows laptops by delivering a browser, Teams, and the Microsoft 365 suite virtually.

“Organizations that can take a step further and move to virtual applications, as opposed to virtual desktops, can get better cost savings, because it’s not consuming as much in the cloud, and you have a little bit better redundancy,” he said.