Microsoft wants to encourage customers to move more apps to the cloud, and it has some ideas about one place they...
With little fanfare, the company said at its Ignite conference last month that Windows Server 2019 will not support the ProPlus version of its Office 365 suite, although the product will work with Windows Virtual Desktop (WVD), which is expected to be released in the first quarter of 2019.
Specifically, Windows Server 2019 Remote Desktop Session Host (RDSH) -- a function within Microsoft's Remote Desktop Services -- will not support Office 365 ProPlus, according to the company. However, Microsoft extended Office 365 ProPlus support on Windows Server 2016 to October 2025, from January 2020.
Some see this as Microsoft's way to incent its mammoth Office user base to migrate their on-premises versions of Office to Azure. Office generates huge cloud-based revenue for Microsoft. This move, plus an aggressive pricing model for Windows Virtual Desktop -- which is optimized for Office ProPlus -- may further convince many users to buy other Microsoft cloud-based offerings, said Jim Gaynor, research analyst with Directions on Microsoft in Kirkland, Wash.
"This may be just a gentle nudge, but they could be far less gentle as time goes on," he said.
For its fiscal fourth quarter ended in July, Microsoft reported commercial revenues of Office 365 rose 38% year over year, and commercial seats rose 29%. The company said it had more than 135 million commercial users of Office 365; by comparison, the Office 365 consumer subscriber base was 31.4 million as of July. For Microsoft's first fiscal quarter of 2019, reported this week, Office 365 commercial revenues were up 36% and seats up rose 29%, while consumer subscribers rose slightly to 32.5 million.
Jim Gaynorresearch analyst, Directions on Microsoft
Windows Virtual Desktop is based on the technology behind Remote Desktop modern infrastructure, which evolved in the past year into WVD, a hosted-only offering. The WVD service lets users run legacy Windows applications and desktops remotely, with all of its components running in Azure and managed by Microsoft. WVD will be part of a Windows 365 package that incorporates Windows 10, Office 365 and Enterprise Mobility + Security.
For now, the lack of Office 365 ProPlus support with Windows Server 2019 RDSH on-premises environments is a moot point. Three days after Microsoft released the operating system on Oct. 2, it was recalled as a precaution when users reported missing files after they downloaded the recent Windows 10 version 1809 OS update. The problems also affect Windows IoT Core version 1809, Windows 10 Enterprise Long Term Servicing Channel 2019 and Windows 10 IoT Enterprise LTSC 2019.
The company has not cleared early adopters to install any of the affected versions, and it has provided no specific information about any connection or carryover from the Windows 10 problems to the server OS.
The pullback will not likely hurt the fortunes of Windows Server 2019, because the vast majority of corporate IT shops will remain in the evaluation phase of the product for some time, Gaynor said. However, it could delay early testing particularly among users of Windows Server Core version 1809, he said.
"I don't have the impression there's been a massive adoption of [Server Core 1809]," Gaynor said. "Most people are still deploying the LTSC of it."
Updated to reflect Microsoft's fiscal 1Q19 results, released on October 24.