Windows 365 compared to Windows 10

What's the appeal of Windows 365 Cloud PCs?

Windows 365 targets businesses of all sizes, as Microsoft offers multiple configurations to meet the needs of different types of users and organizations. The service assigns each user a dedicated Windows virtual machine (VM) -- referred to as a cloud PC -- which can run either Windows 10 or Windows 11. A cloud PC is an optimized, highly-available Azure VM that users can access from any location, as long as the client device has internet connectivity.

Users can work from their cloud PCs on various devices, including Windows, macOS, iOS and Android systems. They can connect to their cloud PCs through the Microsoft Remote Desktop app or HTML5 browsers. A cloud PC works much like a local Windows 10 desktop. Users can run Microsoft and third-party applications, integrate with other Microsoft services and access the Microsoft Store.

Windows 365 vs. Windows 10 licensing

Windows 365 offers a very different licensing and operational model as a cloud service compared to Windows 10 desktops. Microsoft bills Windows 365 customers per user, per month, based on the selected desktop resources -- central processing unit (CPU), random access memory (RAM) and storage. IT teams that manage Windows 10 desktops have to negotiate Microsoft's complex volume licensing requirements and handle all the hardware and software issues that go with day-to-day desktop management.

With Windows 10 licensing, organizations must choose between Windows 10 Professional and Windows 10 Enterprise, and if they choose Enterprise, they must then decide between Enterprise E3, Enterprise E5 and Enterprise Long-Term Servicing Channel. Microsoft also offers the Education E3 and Education E5 licensing options and the Windows Virtual Desktop Access subscription licenses. But these represent only the broad categories, and IT teams must also consider factors such as license type -- user or device -- application agreement, such as Enterprise Agreement or Microsoft Products and Services Agreement, and the need for Software Assurance.

Why Windows 365 offers more functionality than Windows 10

Windows 365 is a cloud service, and as such, it offers all the advantages of a cloud platform while maintaining a focus on desktop delivery. It offers users a great deal of flexibility. They can work from home, office or on the road, moving from one device to another. They can pick up right where they left off without losing any of their settings or work whenever they log on.

Running a cloud-based service also means that users don't require powerful PCs to run their desktops. Because Windows 365 desktops are virtualized, IT teams don't have to provide endpoints with extensive compute and storage resources or incur the capital expenditures (Capex) that come with delivering those resources. In effect, Windows 365 turns user systems into thin clients, which require only enough resources to support connectivity to their cloud PCs.

The release of Windows 11 has made the issue of Capex an even greater consideration. With Windows 11, it's not only a matter of Windows 365 vs. Windows 10. Organizations that plan to move to Windows 11 must also consider that Windows 11 comes with new system requirements, which could translate to larger hardware investments. Windows 365 eliminates this concern because it supports either Windows 10 or Windows 11 without altering the fixed subscription fees or the client systems on which users connect.

Windows 365 also helps organizations by providing a fully managed environment, eliminating the need for IT teams to cope with procuring, installing, deploying and administering the hardware and software that support physical Windows 10 desktops and endpoints. Provisioning Windows 365 desktops is quick and easy and takes no time at all compared to traditional PC management, and maintaining the Windows 365 systems requires little effort on the part of IT.

Windows 365 desktops are also compatible with other Microsoft products and services. For example, Microsoft provides system images that include Microsoft Teams optimizations and pre-installed Office apps. Windows 365 also offers the type of scalability and security available on its other Microsoft cloud services and the predictable pricing that comes with a cloud subscription model.

Standard Windows OS licensing offers more simplicity compared to Windows 365

Given the advantages of cloud PCs, the Windows 365 vs. Windows 10 debate doesn't seem like a debate. But such decisions are never this clear-cut, and many organizations will likely continue to use Windows 10, whether or not they plan to move to Windows 11 anytime soon.

One of the biggest considerations when weighing the choice of Windows 10 or Windows 365 is that Cloud PCs are completely reliant on internet connectivity for any use. If users can't maintain continuous access to Azure via the internet, they cannot maintain continuous access to their desktops. Even short disruptions in service can impact critical operations, making it difficult for users to do their jobs or collaborate on projects. In addition, Windows 365 is not available in all regions, such as China, Cuba and Iran, which may lead to issues for some organizations.

There is, of course, always a debate about security when it comes to cloud-based desktops. Some might argue that cloud providers such as Microsoft offer greater security than what most organizations can achieve on their own. At the same time, threat actors often go after the large cloud providers because they represent such big targets. There have already been reports about Windows 365 exposing Microsoft Azure credentials in plain text. Organizations must tread carefully when putting their data on a cloud platform, no matter how reputable. For this reason, some organizations continue to resist the cloud-based desktop approach, preferring to keep their data in-house. Naturally, this rules out Windows 365.

Organizations must tread carefully when putting their data on a cloud platform, no matter how reputable.

Windows 10 also provides organizations with greater control over their desktop environments and their data. With Windows 365, customers can choose the number of virtual CPUs (vCPUs) and amount of memory and storage for each cloud PC, but they have little control beyond that.

By implementing Windows 10 on their machines, IT departments can choose what hardware and thus computing resources to provide each user. They can also configure each system to meet specific requirements based on the users' needs. Administrators can manage all aspects of the hardware and software configurations, including the specific amounts of processing, memory and storage resources. They can also determine when to update and replace hardware and what components to use, maintaining granular control over each user's environment.

This level of control also extends to the data itself. When customers cancel their Windows 365 subscriptions, all associated data is deleted, at which point standard Microsoft 365 data retention policies kick in. Microsoft might hold on to the data for up to 180 days, depending on the type of data, but eventually, it will be unrecoverable. Although this may be fine in some cases, it still represents a lack of control over the data management process. With in-house Windows 10 desktops, IT determines how desktops should be decommissioned and how to handle the data that goes with them.

Microsoft offers Windows 365 Enterprise customers a resize feature that enables admins to upgrade CPU, RAM and storage. However, customers cannot downgrade their services, nor is the resize feature available to Windows 365 Business customers. Additionally, customers can't convert between Windows 365 Business and Enterprise without losing their data on the current service. IT teams that support physical Windows 10 desktops do not have to contend with such issues.

Organizations also must be wary when comparing Windows 365 and Windows 10 licensing costs. The promise of the low Capex that comes with Windows 365 can seem inviting, but those subscription fees can quickly add up and exceed the cost of supporting Windows 10 PCs in-house. Windows 365 also permits only one user per license; it does not support multiple users on a single cloud PC. The multi-user sessions that Azure Virtual Desktop offers aren't an option here. In addition, Windows 365 Enterprise requires that each user have a license for Windows 10 Enterprise or Windows 11 Enterprise and Microsoft Endpoint Manager and Azure Active Directory P1.

Organizations should also be aware that additional costs can apply based on network usage. Microsoft enforces outbound data volume limits on Windows 365 Business customers. If customers go beyond these limits, Microsoft might restrict bandwidth and outbound data volume, although Microsoft hasn't publicly provided the details of these restrictions. For Windows 365 Enterprise customers, all network traffic goes through the Azure virtual network, which facilitates on-premises network connections. Networking isn't included in the Windows 365 Enterprise license.