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How to Create Azure Offers & Packages

Why package Azure?

You made the decision to transform your MSP practice by leveraging the latest cloud technologies and you decided that Azure and Office 365 are your preferred cloud platforms. You became a CSP Reseller and learned all about Azure terminology, elements, and hierarchy. Your technical team has familiarized themselves with the fundamentals of Azure’s compute, storage, and networking resources and completed a pilot using Nerdio Manager for MSP.

Perhaps you even got trained and certified with the AZ-100 Microsoft Azure exam. You and your sales team learned how to make money in Azure by optimizing your margin and started using Nerdio’s Azure Cost Estimator to model a handful of what-if scenarios for a few customers.

You are now at the point where you want to put this foundational knowledge together to create standardized Azure offers that you can package and take to your existing and new customers and start scaling your Azure practice.

Sure, you could treat every engagement as a custom project with a specialized quote and proposal. However, with Azure’s increased complexity over traditional IT systems, this approach will require your busiest Azure experts to be involved in architecting each customer environment just to put out a quote! Your salespeople will struggle with this approach unless they themselves are super technical and deep in Azure, and ultimately the cost of quoting each Azure engagement will be very high.

How do you address this business agility challenge? In a word: Productization.

Azure Productization

Office 365 is a perfect example of brilliant productization. Microsoft took technically complex products such as Exchange, SharePoint, and the former Lync, then packaged them together for different audiences (i.e., Business Premium for SMB, E3 for Enterprise) — and it took off like wildfire!

Why? Because it became incredibly easy to transact; just buy a monthly subscription and all software and hosting is included. It also became easy for salespeople and customers to understand.

For example, if you work in an enterprise and need Office and Exchange, then E3 is the answer for you. If you own a small business and don’t need all the Office applications but do need a mailbox and the ability to share files with co-workers, then the perfect solution is Office Business Essentials.

This shifts the conversation between salespeople and customers from talking about CPUs, GBs of RAM, and bandwidth to talking about the right “package” for the needs of the business. The technical complexity doesn’t fully disappear from the process. It just moves out of the sales process and over to on-boarding and implementation where it belongs.

Most MSPs don’t win 100% of the proposals they put out, so why spend precious resources dealing with the technical complexity of architecting a solution if it won’t result in a won deal?

Not only does productization reduce the effort during the pre-sale process, it also reduces the sales cycle and increases agility. Having logical, well-structured offers (i.e. packages) simplifies the conversation between salespeople and prospects. It also becomes easier for customers to understand what they are buying and why, without them having to dive into the nuts and bolts of the product. Productization also opens the door to the creation of collateral and web site offers that prospects can review and absorb before even engaging with your sales team.

Compare the buying experience of someone going to an MSP’s website where the CTA (call to action) throughout is, “Contact us for a custom quote” versus someone who goes to the Office 365 website with the various packages listed side-by-side with prices, features, and technical details all in one place. By the time a prospect picks up the phone to contact a vendor selling productized solutions, they already have a good sense of what the products do, who they are designed for, and most likely which product they need.

With a clearly marked price, the MSP can shortcut the entire budgeting discussion and instead focus on pre-qualified prospects who won’t have sticker shock when they hear the price for the first time.

Azure Differentiation

Productizing sounds compelling—but there is more! Let’s look at differentiation. Organizations have a difficult time distinguishing between MSPs and their services. Each website and proposal talk about similar qualifications, expertise, technology, and quality of service. A non-technical buyer struggles to differentiate between one MSP and another.

MSPs have an opportunity to invest the effort to understand their buyers and create differentiated offers. This can make it easier for their buyers to understand what the MSP does and how they compare to the competition. Sometimes it can be something as simple as combining the same set of services in a clearer way and in a bundle the buyer understands.

Finally, let’s not forget the reason why you’re in business – to make money. What impact does productization have on margin? It is well known that selling products and services as individual line items, especially when they have publicly available list prices, leads to significant price pressure particularly at closing. Customers look at line items and try to understand each one individually, often comparing prices online.

This squeezes MSP margins significantly. With productized offers, there is significantly less price pressure as there is no way to price shop a productized package due to its uniqueness. MSPs can now bundle in valuable services like a help desk that may not have an immediate marginal cost to deliver, but increases the value of the bundle.

Differentiated, packaged offers lead to significantly higher margins as compared to proposals that itemize each line item. MSPs offering IT solutions on top of Azure should expect to achieve gross margins in the 40%-60% range on offers that can range from $50 to hundreds of dollars per user/month in price to the customer.

By now you’re probably asking yourself, “if productizing MSP services is so great why isn’t everyone doing it?” Well… it’s hard. You need to have a good understanding of your audience, your service delivery capabilities, and your risk tolerance. You will need to go through a rigorous trade-off process to decide not only what to include in each package, but more importantly, what to exclude.

The goal of this article is to help you identify these decision points and provide you with the tools needed to arrive at a productized Azure offering that’s right for your MSP practice.

We would be remiss in not mentioning some of the trade-offs that come with productization. By putting services and technologies in bundles, you do give up some flexibility. With custom services, every engagement can be a perfect fit for every customer. With productized, packaged offers, customers are bound to get some things that they may not need (just think of some apps included in Office 365 you never use) and not be able to get some of the things they may want without upgrading to the next tier.

It may be tempting to make exceptions and create one-off, custom solutions for customers to meet their precise needs. However, if you do this too much, the value of productization is diminished and you’re back to where you started. It is important to be comfortable with sometimes saying “no” and sticking to your standardized offering. If you’re doing this too often, it may be a sign your packaging isn’t quite right just yet and needs to be tweaked. However, if your standard packages meet the needs of your customers without significant customization 80% of the time, saying “no” 20% of the time may be well worth it.

A Case Study Example: HeadInTheCloud Services, Inc.

Before delving into the specifics of designing your Azure offers, let’s address some critical success factors and questions you must answer to structure your offer, including:

  • What should be included in the Azure offer?
  • How many service categories should there be?
  • How many plans should be in each category?
  • How to decide if a specific feature should be part of a bundle or serve as an add-on?
  • How to price each plan?
  • How to lay out the offer and present it to customers?

To illustrate this, we will work with a fictitious MSP called HeadInTheCloud Services, Inc. (HTCS, for short).

HTCS is a full-service MSP with ten years of operational experience installing on-prem servers and networking, configuring Windows environments, setting up Exchange servers, migrating customers to Office 365, and managing customers’ security stack including AV, firewalls, and content filtering. HTCS offers help desk and Virtual CIO services, uses an RMM, and manages customers remotely as well as onsite. The customer base consists of 75 managed services customers and a few dozen break-fix customers who occasionally call HTCS for help with one-off projects.

Bill, HTCS’ founder and President, decided that he wants to modernize HTCS and migrate most or all of his managed services customers to Azure and Office 365 over the next five years. Bill wants to leverage as many services as possible in Azure and migrate customers’ data, servers, line-of-business applications, messaging and even virtualize their desktops in Azure. The goal is to leave as few items on-premises as possible and become a true Azure MSP. He learned as much as he could about building an Azure practice and had his engineering team go through technical training. HTCS became a CSP Reseller and understands how to optimize Azure consumption to maximize margins.

HTCS has two salespeople. They are somewhat technical, but rely heavily on Jim, the Senior Engineer at HTCS. Jim is also playing the role of a Sales Engineer and Cloud Solution Architect. At every customer engagement, when the discussion turns to Azure, the salespeople do a good job getting the prospects interested and asking for a quote.

But then they bring in Jim, who needs to understand the customer’s current environment, architect a comparable Azure environment, and price it. This architecture and the cost are then presented to the customer by the salespeople and there are inevitable changes, causing lots of back-and-forth with Jim having to re-architect and re-price the environment. Suffice it to say, the sales process is less than efficient and sometimes takes weeks to finalize an architecture and price for the customer to consider.

Bill wants to leverage HTCS’ existing customer base to come up with standardized Azure IT offer to enable his salespeople to present to all customers, especially when their contract is up for renewal or hardware is due for a refresh. Bill decided to call his offer IT-as-a-Service (ITaaS) and wants it to be an all-inclusive solution that’s easy to sell, sticky with his customers, and provides HTCS with strong margin (40%+).

Should Azure consumption be bundled or not?

The first question Bill needs to answer is whether or not to bundle Azure consumption costs with HTCS’ managed services or allow the customer to buy Azure independently (unbundled). Azure is a consumption-based public cloud, which can be quite challenging to quote accurately, and Bill is concerned that he may not be able to precisely predict the cost of Azure consumption for a particular customer on a monthly basis.

Bill has two options to consider:

Option 1: Azure consumption is not bundled with the offering

Let the customer bring their own Azure subscription, or sell the customer a CSP Azure subscription but bill for it separately from any other services that HTCS offers. This would be pass-through billing where HTCS will provide each customer with a monthly Azure usage report showing how much was consumed in the prior month. There are pros and cons to this approach.

  • Low risk to HTCS – the customer only pays for what they consume.
  • HTCS will make a small margin on Azure consumption, which will be the CSP discount.
  • Customer may not be happy carrying Azure consumption risk and will likely expect HTCS, being the IT experts, to carry this risk.
  • HTCS is making a low margin (typically <10%) on a significant amount of monthly spend.
  • Billing will have to be done in arrears and will need to be reconciled with CSP billing. It won’t be possible to charge for Azure upfront at the beginning of the month: only at the end once the actual consumption is known.
  • Customer will want to know precisely what the costs are going to be, which means Jim will have to get involved with every opportunity to scope, architect, and price it.

Option 2: Azure consumption is bundled with the offering

HTCS will include the cost of Azure infrastructure as part of their ongoing managed services cost and will not pass-through the actual consumption costs to the customer. Customers will be paying for HTCS’ services based on a value metric that’s independent of Azure infrastructure (e.g. per-user, per-endpoint, fixed monthly fee, etc.).

  • The customer will benefit from an easy-to-understand pricing structure and HTCS will benefit from a simplified way of explaining and selling a managed service with Azure bundled in. The customer will also have an easier time budgeting for changes, such as increases in number of users.
  • HTCS will be able to charge an Azure management fee and bake it into the overall bundle price, thus increasing profit margins from <10% with a CSP discount to something significantly higher.
  • HTCS can bill for the entire managed service at the beginning of the month and not have to wait until the Azure consumption bill has been finalized. This will allow HTCS to collect a full 30 days sooner and have the money on hand when the Azure bill comes due.
  • If bundle pricing is well calibrated and there is enough margin to absorb any fluctuations, the quoting process will be much simpler. There may not even be a need to get Jim involved with every opportunity.
  • HTCS can take advantage of all Azure margin optimization best practices, including Reserved Instances, Software Subscriptions, and auto-scaling to maximize its margin while charging the customer Azure list prices without any markup.
  • Customer billing process will be much simpler without the need to provide the entire Azure consumption reconciliation report and try to explain each line item every month. When Azure is bundled in, it is not itemized.
  • HTCS is carrying the risk that Azure costs may exceed what was budgeted.
  • If customer needs to increase the cost of Azure infrastructure, HTCS will have to go back to the customer and adjust pricing.

Bill decides to take on some risk in exchange for simplicity and higher margins and bundles Azure with his managed services.

How many service categories and how many plans in each?

Given HTCS’ extensive services portfolio, Bill is trying to decide how many categories of services should be part of HTCS’ Azure ITaaS offer. Having more categories allows HTCS to showcase more of its capabilities and create many revenue streams. On the other hand, each category of services increases the number of decisions a prospective customer has to make before becoming HTCS’ customer. Bill decides that there should be no more than five categories to strike a healthy balance between these two competing objectives.

Service Categories

HTCS decides to have the following service categories:

  1. Managed Services and per-user security items
  2. Azure infrastructure
  3. Office 365 licensing
  4. End-user help desk
  5. Add-ons

Within each service category, Bill decides to keep the number of plans to a minimum to make the decision process easier for the prospect and his salespeople while still providing enough choice for each customer to get exactly what they need.

Each category will have three plans. Let’s see what Bill came up with.

Managed Services and per-user security items (60% – 80% gross margin)

This is the money-making category. HTCS is an experienced MSP and is quite familiar with providing significant customer value through proactive IT services, automated monitoring, and remote remediation. Today, HTCS prices its managed services on a per-user basis. With its new IT-as-a-Service Azure offering, HTCS would like to continue offering managed services with their existing RMM, given the significant investment that has already been made into the RMM product. After all, Azure VMs are just like on-premises VMs and need to be closely monitored and maintained.

HTCS’ Azure ITaaS offering will be virtual desktop-centric, so Bill decides to call the service category “Managed Virtual Desktop” and creates three plans: Silver, Gold and Platinum.

Here is what Bill decides to include in each Managed Virtual Desktop plan:

Each plan includes base functionality such as multi-monitor support and RDS licenses. Security services (e.g. Webroot AV, MFA, patch management) are added in the more premium plans, and Performance and 24×7 Monitoring is available in the top-tier plan.

Bill knows that with a good/better/best type plan structure, the best-practice is to choose the middle plan (Gold in this case) to be his desired outcome and to design the two edge plans (Silver and Platinum) to showcase the amount of value included in the preferred plan (Gold) to customers.

By bundling together multiple valuable managed services, HTCS is budgeting to capture 60% to 80% gross margin of the managed service price when it is sold as part of the comprehensive Azure ITaaS offer.

Azure Infrastructure (20% – 50% gross margin)

Bill decides to once again create three Azure infrastructure packages to fit his customers’ needs. He considered bundling Azure with the Managed Virtual Desktop plans, but after reviewing multiple existing customer accounts, he discovered that HTCS would lose significant flexibility in being able to tailor each customer’s account to their exact needs. Bill also considered selling Azure in an “unbundled” fashion by passing the actual cost down to the customer but decided against this due to the billing complexity and margin pressure that HTCS would be subject to.

Bill came up with the following three packages that would meet the needs of 80% of his current and prospective customers, and left open the possibility for HTCS to create custom Azure infrastructure packages for individual customers as the need arose. Bill built in a bit of margin into the Azure infrastructure packages in addition to the standard discounts provided by HTCS’ CSP provider. He also intends to take full advantage of other Azure margin optimization levers such as reservations, software subscriptions, and auto-scaling.

By reselling Azure infrastructure in a bundle and charging a modest fee for infrastructure monitoring and management, HTCS is budgeting to capture 20% to 50% in gross margin for this service category when included with other components of the Azure ITaaS offering.

Office 365 licensing (10% – 15% gross margin)

As is the case with many MSPs, Office 365 is the most popular SaaS application that HTCS resells and supports. Almost all existing customers have been migrated from on-premises Exchange servers to Office 365 and many are leveraging Teams, SharePoint, OneDrive, and other Office 365 suite applications.

The challenge with reselling Office 365 licenses is the publicly available list prices and customers’ expectation that it will be sold at or below list price. Office 365 is certainly a key component of HTCS’ ITaaS offer as it is the messaging and collaboration platform and a mechanism for licensing the Office suite, but it is not going to be a high margin line item.

Bill decides to limit the published Office 365 plans to the three most common ones, used by 80% of his customers. HTCS will continue selling all other Office 365 and Microsoft 365 products but for the purpose of designing and presenting the Azure ITaaS offer, these three are likely going to be enough.

Because of Office 365’s popularity and well-known pricing, HTCS expects to capture only 10% to 15% margin, which represents the discount provided by the CSP Provider. However, this is not an issue since significant margin to cover the administration of Office 365 and other per-user services has been included in the Managed Virtual Desktop service.

End-user help desk (10% to 20% gross margin)

Like most MSPs, HTCS provides its customers’ end-users with help desk services for their day-to-day computer work, troubleshooting local and mobile devices, and being available after-hours, when needed.

Traditionally, HTCS bundled help desk into their overall managed services offering, but in the process of designing the Azure ITaaS offer realized that the needs of their customers varied based on an organization’s hours of operation and available in-house IT support.

Therefore, Bill decides to unbundle help desk from the rest of the managed services to allow a more precise match of services for the customer’s needs. Bill created three help desk plans segmented by availability of support (business hours only, long hours on weekdays, and 24/7), SLA expectations (i.e., first response and resolution), and number of authorized points of contact who can escalate issues directly to Tier 2 support.

Providing end-user help desk support is highly labor intensive, especially when the SLA expectations are high, and support is needed outside of regular business hours. However, it is often a non-negotiable necessity for an MSP and it had to be made available as part of the Azure ITaaS offer.

HTCS has priced its end-user help desk support package with very modest 10% to 20% gross margin targets as a high support price can turn off a prospect from the entire engagement since they think they’ll rarely need it and are hesitant to pay much for it up-front.

Add-ons (gross margin varies)

HTCS offers many services and technologies to their customers and are planning to continue to do so. However, for the sake of keeping the sales process for the Azure ITaaS offer as streamlined as possible, only the most popular add-ons were selected to be included in the basic offer.

The add-ons portion of the Azure ITaaS offer is designed to showcase certain services that are commonly purchased together with the rest of the virtual desktop-centric IT environment. These include one-time projects such as onboarding and migration, ongoing Virtual CIO strategic services, and popular licenses like SQL Server.

How do you decide if a specific feature should be part of a bundle or be an add-on?

To decide what features should be included within each of the service categories of the proposed Azure ITaaS offer, Bill utilized the Value Matrix model created by Price Intelligently (experts in SaaS pricing).

Each potential feature is evaluated along two axes: the value it delivers to the customer and the customer’s willingness to pay for the feature. This type of analysis is typically done as part of large-scale pricing study, but can be done qualitatively for any MSP who understands their customers’ needs.

  • Core Features – these are features without which you can’t really have a credible offer. These features are table-stakes. Customers expect them from any MSP they would consider hiring and therefore don’t see them as differentiators. They may be quite valuable, but customers aren’t willing to pay much for them without a lot of convincing and selling. For MSPs, examples of Core Features may include:
  • End-user help desk
  • Remote monitoring and management
  • Office 365 implementation
  • Differentiable Features – these features are both highly valuable and benefit from customers’ high willingness to pay for them. They are items that differentiate one MSP from another and showcase a particular MSP’s expertise in a certain technology, methodology, or industry vertical. It is ideal to have a few differentiable features in each Plan. For MSPs, examples of Differentiable Features may include:
  • Virtual Desktop management expertise
  • Azure expertise
  • Financial services, non-profit, or any other vertical specialization
  • Trash Land – these are service components that are both low value and as a result have low customer willingness to pay. When designing an offer, it is best to reduce or eliminate the number of such features, as they don’t help capture value (via gross margin), yet cost money for the MSP to deliver. For MSPs, an example of a Trash Land item is the resale of Office 365, AntiVirus, or backup without any value-added features on top of the software license. The customer can purchase the licenses in any number of channels and if the MSP is not providing value on top of the license, these should not be included in a well-designed Azure ITaaS offer.
  • Add-ons – customers may not place much value in these features, but a select few, are very important. Such features shouldn’t be included as a part of the standard offer but should instead be made available as an add-on to a core offering. For MSPs, example of Add-ons may include:
  • Hot-site DR for financial services customers or others with specific regulatory requirements
  • Ongoing Virtual CIO services for companies without any in-house IT expertise to help guide the long-term IT strategy
  • Special licenses like SQL Server for those organizations with line-of-business apps requiring SQL

It is important to remember that features move around the four quadrants of the Value Matrix over time. Something that starts out as a differentiated feature may eventually become a core feature, or even move to Trash Land. Add-ons that may be applicable to only a select customer segment may become popular and eventually become a core feature. Therefore, every couple of years the plans and packages must be reviewed to ensure the proper feature mix.

When designing individual plans for the Azure ITaaS offer, Bill created a list for each possible feature in all categories and then evaluated them based on the diagram above. Core features were made a part of all plans, differentiated features were used to clearly distinguish between individual plans, Trash Land features were kept to a minimum, and add-ons were used to make unique features available as separate items with a healthy gross margin.

How to price each plan?

Pricing subscription services is far from trivial. The most accurate approach is to conduct a large-scale pricing study surveying thousands of customers across a broad spectrum of features, packages and their willingness to pay for each combination. Such pricing studies tend to be very expensive ($100K+) and are unlikely to be conducted by too many MSPs. However, the typical services offered by MSPs are largely consistent across geographies and industries and it is possible to get a pretty good idea of a customer’s willingness to pay based on an MSP’s experience selling such services to dozens or hundreds of customers.

Note: Nerdio has conducted a large-scale pricing study of MSP services to calibrate our recommendations and we are happy to share the results with our MSP partners. If you’re an existing MSP partner, get in touch with your Nerdio Partner Manager. If you’re not, there’s never been a better time to become one! Get in touch.

The major takeaways from Nerdio’s pricing study of thousands of SMB customers include:

  • A willingness to pay for an all-inclusive package (infrastructure, software, and services) of cloud IT services ranges from $100 to $250 per user per month
  • Larger companies tend to be willing to pay more per user than very small companies
  • Companies in highly regulated industries (i.e., healthcare, financial services, legal, etc.) tend to be willing to pay more per user

Understanding a customer’s willingness to pay at certain price points and with specific pieces of functionality is helpful in designing a complete Azure ITaaS offer and splitting the complete offer into prices of individual components. For instance, the sum-total of all “lower end” plans in an Azure ITaaS offer should add up to roughly $100/user/month, while the sum of all “higher end” plans should add up to about $250/user/month.

How to package your offer and present it to customers

Having gone through the above exercise, Bill needs a way to pull all the information together to present it to his team and eventually prospective customers. Fortunately, Nerdio’s Plans Designer functionality has been created for just this reason.

It is a fully functional Azure ITaaS pricing page creator that allows MSPs to design their own packages with customer plans, features, and prices and then publish the entire offer as a “Pricing Page” on their own website with custom branding, colors, and images.

The Pricing Page serves as a selling tool for the sales team to review Azure ITaaS options with customers and a lead generation tool for anonymous website visitors who want to price out their own Azure ITaaS solutions.

We hope this article and case study proved to be helpful for you. We will continue to update this page as more Azure packaging information comes to market.


Multi-Cloud and On-Premises Deployment with Azure Stack HCI (Coming Soon)

Deploy Azure Virtual Desktop in Azure and extend the session host VM placement to on-premises and other cloud using Azure Stack HCI. Nerdio Manager automates deployment of session hosts, AVD agent installation, and full integration into the AVD deployment in Azure.

Create a brand new Azure Virtual Desktop environment or allow Nerdio Manager to discover an existing deployment, connecting to existing resources, and manage them.

Deploy Nerdio Manager from Azure Marketplace and configure a new AVD environment with an easy to follow, step-by-step configuration wizard. First group of users can access their AVD desktop in less than 2 hours.

Service providers, system integrators, and consultants can leverage Nerdio Manager’s scripted AVD deployment template. Create complete environments with desktop images, host pools, and auto-scaling in minutes.

Create and manage AVD environments that span Azure regions and subscriptions. Quickly link Vnets and resource groups and manage AVD deployments world-wide from unified portal.

Link multiple Azure tenants under the same Nerdio Manager instance and manage AVD deployments that span Azure AD tenants. User identities and session host VMs can run in separate tenants for maximum flexibilty and security.

Deploy and manage AVD environments that span across sovereign Azure Clouds. Cross-sovereign cloud support allows identity (e.g. users and groups) to be in one Azure Cloud, while session host VMs are in another Azure Cloud.

Management of workspaces, host pools, app groups, RemoteApps & custom RDP settings

Administer every aspect of AVD with Nerdio Manager including workspaces, host pools, application groups, RemoteApp publishing, RDP properties, session time limits, FSLogix, and much, much more. Every Azure service that AVD relies on can be managed with Nerdio Manager.

Deploy and manage AVD session host VMs. Hosts can be created manually or with auto-scaling, deleted on-demand or on a schedule, re-imaged to apply updates, run a scripted action, resized, put into or taken out of drain mode, and more.

Manage user sessions across the entire AVD environment, within a workspace, host pool or on a single host. Monitor session status, disconnect or log off the user, shadow or remote control to provide support, or send user an on-screen message.

End users have the ability to log into Nerdio Manager with their Azure AD credentials and manage their own session, restart their desktop VM, or start a session host if none are started in a host pool. (Ability to resize and re-image own desktop is coming soon.)

Create, link, and manage Azure Files shares including AD domain join. Synchronize Azure Files permissions with host pools, configure quotas, and enable SMB multi-channel. Manage file lock handles and configure Azure Files auto-scaling to increase quota as needed.

Create, link, and manage Azure NetApp Files accounts, capacity pools and volumes. Configure provisioned volume size, monitor usage, and use auto-scaling to automatically adjust volume and capacity pool size to accommodate the needed capacity and latency requirements.

FSLogix configuration can be complex and overwheling, but not with Nerdio Manager. Create one or more FSLogix profiles with all the needed options, point at one or more Azure Files, Azure NetApp Files, or server locations and select from VHDLocations, CloudCache and Azure Blob storage modes.

Multiple identity source profiles can be set up and used automatically on different host pools. Active Directory, Azure AD DS, and Native Azure AD are all supported. Choose the appropriate directory profile when adding a host pool and all VMs will automatically join this directory when being created.

Create a copy of a host pool with all of its settings: auto-scale config, app groups and RemoteApps, MSIX AppAttach, user/group assignments, VM deployment settings, etc. Save time by creating host pool “templates” that can be cloned to any Workspace, Azure region or subscription instead of starting from scratch.

Apply user session time limits at host pool level. Automatically log off disconnected sessions, limit the duration of idle sessions, control empty RemoteApp session behavior and more.

Assign Azure AD users to personal desktops to ensure the user will log into a pre-configured VM. Un-assign personal desktops from users who leave the organization and re-use these VMs for new users.

Pre-configure custom Azure tags for all Azure resources associated with each host pool. Tags can be used for charge-back and cost allocation by host pool.

When creating session hosts using NV-series VMs NVIDIA and AMD GPU drivers are automatically installed.

Move existing host pools from Fall 2019 (Classic) object model to Spring 2020 (ARM) object model. Choose to whether to move or copy user assignments. Existing session hosts are automatically migrated or new ones can be created in the ARM host pool.

Automatically enable and configure AVD integration with Azure monitor. Zero configuration required. Azure Monitor Insights for AVD can be used instead of or in conjunction with Sepago Monitor.

AVD personal desktops to Windows 365 Cloud PC migration (Coming Soon)

Migrate users from AVD personal desktops to Windows 365 Enterprise Cloud PCs using an existing image and user assignment. (Coming soon)


Create desktop images from a single pop-up with just a few clicks. No need to Sysprep, capture, version or do any of the other complex Azure image management tasks. Nerdio Manager fully automates the process. Desktop Images can start with a gallery image, existing custom image, or even an existing VM. Images can be stored as custom or Shared Image Gallery integrated objects.

Duplicate desktop images by cloning them to either the same region or another Azure region. Make a clone before making major changes to the image so the changes can be tested without impact the production environment. All with one click.

Distribute desktop images to multiple Azure regions by selecting the locations where the images should be available. Can be enabled on new or existing images. A single desktop image VM can now be used to update AVD session hosts in all locations.

Schedule a recurring update to Desktop Images and automatically re-image host pools on a pre-defined schedule. System and application updates can be automatically applied after hours without manual intervention.

Schedule a regular refresh of a desktop image from Azure Marketplace using the latest patched version. Customize the image with scripted actions and have it automatically deployed to host pools for full end-to-end update automation.

Leverage native Azure backup to create versions of desktop image VMs before making changes and easily revert to prior versions. Take a backup of an image VM while powering it on to modify or manually trigger a backup at any time.

Maintain multiple version of a desktop image by retaining old versions during image updates. These version can be easily used to deploy session hosts in the future.

Modify and update production images and test them without affecting current production host pools that use these images. When updating an image, select for the new version to be created in “staged” mode. Designated test host pools can start using and testing this image right away, but production host pools will only begin using it when it is activated after testing and validation. The end-to-end process of image update, user acceptance testing, and deployment into production can be fully automated.

Ensure that users always log into a pristine, image-based session host by refreshing (re-imaging) used VMs after users log off. In single-user pooled scenarios, desktops will be automatically re-imaged when users log off. In multi-user pooled scenarios, session hosts will be re-imaged as soon as the last user logs off. This way, all hosts will be always kept up-to-date and in pristine state

Schedule a recurring update to Desktop Images and automatically re-image host pools on a pre-defined schedule. System and application updates can be automatically applied after hours without manual intervention.

When session host VMs are re-imaged, the VM name, AD computer object, IP address and DNS host name remain the same. No need to update other systems when re-imaging host VMs since they appear identical to external systems before and after the re-image process.

Before “sealing” the image (i.e. running “set as image” task) document any changes that were made. A report can be generated to show these changes and who made them.


Dramatically reduce Azure compute and storage costs up to 75% by precisely matching the size of Azure infrastructure to the user demand at all times. Nerdio Manager provides multiple auto-scaling algorithms based on CPU usage, RAM usage, user sessions, and user-driven behaviors. Multiple usage triggers can be combined (e.g. CPU and RAM) for precise scaling behavior.

Start VMs when users need them and stop them automatically when no longer in use. VM power management reduces Azure compute costs up to 75%.

Create new session host VMs on-the-fly, as needed, without keeping many VMs created and consuming storage costs by the OS disks. Newly created VMs are always fresh and based on the prestine image state. Add scripted actions to customize the VM provisioning process. When the VMs are now longer needed they can be automatically removed from the environment. A mix of “base capacity” (always created VMs) and “burst capacity” (just-in-time VMs) optimizes costs and user experience.

Auto-scale can start, stop, create, or delete session host VMs based on several auto-scale algorithms that take into account actual usage (e.g. CPU, current active sessions) and/or do so on a schedule to pre-stage capacity in expectation of users logging in.

Balance between cost savings and end-user experience by setting one of three scale in aggressiveness levels that controls the type of hosts can be scaled in (stopped or removed). High aggressiveness provides the highest savings and will forcefully disconnect even active users after end of work hours. Medium will stop host with disconnected sessions. Low aggresiveness will only stop or remove hosts that has no user sessions.

Create multiple auto-scale pre-stage settings to ramp up host pool capacity during certain days of week and times of days. In education environments multiple schedules can be used to turn on VMs based on a pre-defined class schedule.

Provide users with non-persistent, single-user pooled desktops that are used exclusively by a single user during the session then returned to the pool, optionally refreshed/re-imaged, and made available to others. This VDI host pool configuration provides significant savings as compared to permanently-assigned pesonal desktops.

Save up to 90% on Azure VM compute costs while testing an AVD deployment by creating session hosts as Spot VMs. Not to be used in production scenarios as VMs can be unexpectedly “evicted”. Easily convert VMs from spot to pay-as-you-go and back to spot VMs with this scripted action.

Save up to additional 60% on the cost of Azure compute by using Reserved Instances in combination with auto-scaling. Nerdio Manager will analyze prior auto-scale behavior and recommend quantity of CPU core reservations to purchase to take advantage of RI savings.

Host VMs shut down from inside Windows are in stopped, but not deallocated, state and continue to generate Azure compute costs. Nerdio Manager can automatically detect VMs in this state and deallocate them proactively.

Define “running” OS disk storage type (e.g. Premium or Standard SSD) and “stopped” OS disk storage type (e.g. Standard HDD). Auto-scale will change the OS disk to cheaper storage when it stopped and automatically change it to a more performance storage type when the VM is started. This results in up to 75% in OS disk storage savings when the VM is not running.

Save on OS disk storage costs and increase performance with Ephemeral OS disks that can be used for AVD session host VMs. Ephemeral OS disks are free and are stored on the Azure physical host’s local storage and are therefore faster.

Reduce the size of an image VM’s OS disk from the default 128GB to 64GB (or 32GB). This reduces storage costs for session host VMs by requiring a smaller disk and allows for use of smaller VMs with ephemeral OS disks.

Ensure high performance of Azure Files at the lowest possible cost. The performance characteristics of Azure Files Premium are determined by the provisioned capacity quota. Storage auto-scale increases capacity quota in response to increased storage latency (or on a schedule), and decreases it when the extra performance is no longer needed to save on costs.

Ensure high performance of Azure NetApp Files at the lowest possible cost. The performance of an Azure NetApp Files volume is determined by the volume size, regardless of capacity actually used. Storage auto-scale increases the volume size during times of peak demand (e.g. log-on and log-off storms) and decreases it automatically when the extra boost in performance is no longer needed. This is done based on a schedule and/or in response to elevated IO latency. Storage auto-scale also automatically grows volume (and capacity pool) size when capacity reaches a pre-defined threshold ensuring that it never runs out of space.

Shrink FSLogix VHD(X) by removing the “white space” from inside the profile container. This dramatically reducess FSLogix storage costs.

Automatically run Microsoft’s Windows 10 and Windows 11 virtual desktop optimization tool on session host VMs as they are created. This results in drastically improved performance and increased user-per-CPU density, which reduces total Azure compute costs.


Cloud PC License Usage Optimization

Reduce total cost of Windows 365 Cloud PCs by optimizing license assignment and reclaim and re-use unused licenses.

Extend existing AVD environments with Windows 365 Enterprise Cloud PCs. Nerdio Manager automatically creates the necessary network connections, images, and provisioning policies based on the current AVD configuration. It can also be used to deploy Windows 365 even if there is no existing AVD deployment.

Cloud PC device lifecycle management

Manage all aspects of Windows 365 Enterprise Cloud PCs. Restart, re-provision from image, resize to a larger VM size based on available licenses, end grace period when Cloud PC is no longer needed, and run any Powershell script on one or more Cloud PCs.

Cloud PC user group assignment

Create and manage Cloud PC provisioning policy and assign user security groups to policies to begin the provisioning process for licensed users.

Intune primary user management on Cloud PCs

Automatically detect if a provisioned Cloud PC does not have an assigned Intune primary user. Alert administrator and allow for one-click primary user assignment.

Leverage existing AVD images to create Cloud PC deployments. Image updates are automatically applied to AVD and Cloud PC environments using these shared images.

Scripted actions are shared between AVD and Windows 365 Enterprise Cloud PC environments. Scripts that install apps, apply optimizations, or anything else that can be scripted with Powershell can be applied to both AVD session hosts and Cloud PCs.

Migrate AVD personal desktops to Cloud PCs (Coming Soon)

Automate the migration process from a personal AVD host pool to an Enterprise Cloud PC. (Coming soon)


Enable host pool level active/active DR configuration and Nerdio Manager will automatically distribute session hosts across two Azure regions. Users will be distributed across VMs in both regions as they log in and FSLogix profiles will be automatically replicated using Cloud Cache. In case of an Azure region failure users will continue accessing VMs in the available region.

Auto-scale can automatically detect broken AVD session hosts and attempt to repair them by either restarting or deleting and re-creating the VMs without user intervention.

Protect against data center failure by automatically distributing session host VMs across Availability Zones (data centers) in supported Azure regions.

Azure availability sets of variable size can be optionally enabled. When enabled, session host VMs are automatically placed in availability sets when deployed.

Leverage native Azure backup to create versions of desktop images before making changes and easily revert to prior versions. Take a backup of an image while powering it on to modify or manually trigger a backup at any time.

Modify and update production images and test them without affecting current production host pools that use these images. When updating an image, select for the new version to be created in “staged” mode. Designated test host pools can start using and testing this image right away, but production host pools will only begin using it when it is activated after testing and validation. The end-to-end process of image update, user acceptance testing, and deployment into production can be fully automated.

Scheduled Nerdio Manager backup

Configure a scheduled backup of Nerdio Manager application by protecting App Service, Azure SQL database, and key vault contents.


Nerdio Manager is a single-customer Azure application deployed from the Azure Marketplace into a customer’s own Azure environment. It consists of Azure PaaS services only with no VMs to manage. The application is integrated into Azure AD and uses Graph API to turn the dials inside the Azure environment. No third-parties have any access into the customer’s Azure environment.

No third-party vendor access

Nerdio Manager is not a hosted SaaS service, but rather an Azure application that’s installed in a single customer environment. There is no third party access to this single tenant app deployment.

Data residency control

Because Nerdio Manager is an Azure application, customers can choose the Azure region where it is deployed. All associated metadata is stored in a selected Azure region with customer having full control over backup, retention, and destruction of this metadata.

Delegate access to deploy and administer Azure Virtual Desktop deployments to users with defined role-based access controls. Built-in AVD Admins can full access to the environment, Reviewers have read-only access, Desktop Admins can manage images and power state of host VMs, Help Desk users manage user sessions, and End-users can manage their own virtual desktop session in a self-service portal. Create your own custom RBAC roles and select Read-only or Full Access to all areas of Nerdio Manager, including limiting access to individual host pools.

Create custom roles to control admin access to all areas of Nerdio Manager. Custom roles define scope and level of access and can be assigned to users and security groups. Users can access modules in read-only or full access mode.

RBAC admin roles can be assigned to users and groups and proper level of access is provided at Workspace level and host pool. Different groups of admins can manage different sets of Workspaces and host pools within a larger AVD deployment.

Company-provided SSL certificate and domain name can be applied to Nerdio Manager for Enterprise Azure App Service to increase the security posture of the deployment.

Protect Nerdio Manager and AVD deployment by hardening the SQL, Key Vault, Storage Accounts, App Service by enabling private vnet endpoints in Azure.

Prevent Users from Using Saved Password in AVD Client App

Increase security posture of an AVD host pool by preventing users from using saved credentials in their AVD client app. Users will always be prompted for password when logging into their desktop.


Consolidated dashboard that combines usage, costs, and savings across all Workspaces in WVD deployment. Select desired time range and view graphs of named, concurrent, and active users. View graphs of host pools, hosts, and total CPUs. Review and export data on compute and storage costs savings.

Analyze Azure compute (VMs) and storage (OS disks, Azure Files and Azure NetApp Files) costs at per-hostpool, per-workspace and across the entire environment. Understand average per named, concurrent, and monthly active user costs.

Export detailed usage and costs data to be used for chargeback.

Review auto-scale behavior in an easy-to-understand, visualized dashboard that can be drilled into for more detail. All auto-scale behavior, including corresponding user sessions, can be reviewed for further optimization.

View project montly compute (VM) and storage (OS disks) costs when creating a new host pool. The real-time calculation is based on Azure pricing API and takes into account the entire auto-scale configuration profiles. This calculation provides the minimum host pool cost, assuming the pool stays at the minimum size and never scales out, and the maximum cost, assuming the host pool scale out to its maximum size and never scales in.

Azure list prices used for all calculations can be adjusted with a negotiated discount so all financial data accurately reflect actual Azure costs.

Be always in the know with automated notifications and alerts. Define rules to generate email alerts based on various conditions and actions. Select whom to notify based on tasks, statuses, resources, and other criteria.

Gain fully visibility into AVD environment that extends beyond the Azure Monitor Insights. User sessions dashboard provides a wholistic view into user performance that can be drilled down on a per-user basis to understand latency, app input delay, utilization patterns and more.

Hosts dashboard provides a deep analysis of VM performance and utilization (e.g. CPU, RAM, CPU queue, Disk queue, etc.) and displays recommendations for user-to-host density.

Application dashboard display per-application-per-user stastics to understand applicatino usage patterns, application resource consumption, and user behavior.

Track and report on all changes to desktop images performed by all users.


Leverage the power of Nerdio Manager automation by integrating with existing ITSM platforms (e.g. ServiceNow). Add and re-image hosts, create or update desktop images, control user sessions and much more.

Scripted actions provide limiteless flexibility in AVD deployments. Windows scripts can be used to execute any set of Powershell commands on VMs are created, started, stopped, remove, or re-imaged. This can be used to deploy applications, security software, optimizations, and much more. Azure runbooks can be used to configure and maintain the Azure environment on the outside of the VM. Many triggers are available including VM or AVD host create, start, stop, delete, image create, schedule, run-once, and more.

Synchronize scripted actions with Public and/or Private GitHub repositories. Use your favorite tools, like Visual Studio Code, to edit and maintain scripted actions with all of the power of GitHub workflows, versioning, and so much more. Scripted actions are automatically synchronized with GitHub repositories and any changes take effect immediately without any configuration changes made in Nerdio Manager.

Azure DevOps Integration with Scripted Actions (Coming Soon)

Synchronize scripted actions with Azure DevOps. Use your favorite tools, like Visual Studio Code, to edit and maintain scripted actions with all of the power of Azure DevOps workflows, versioning, and much more. Scripted actions are automatically synchronized with Azure DevOps repositories and any changes take effect immediately without any configuration changes made in Nerdio Manager.

Windows scripts and Azure runbooks can be executed automatically with security context maintained by Nerdio Manager during VM create, delete, start stop, and AVD host register operations.

Windows scripts and Azure runbooks can be executed on all hosts within a host pool either on demand or on a schedule with recurrence.

Automatically install software on newly created desktop images or maintain existing images with regular updates using Scripted Actions.

Execute Scripted Actions on desktop images while packaging the VM into an image object. These scripts do not impact the original image VM but only apply to the the resulting image. For example, SCCM agent can be uninstalled from the image but remain on the image VM where it is used to update and install software.

Leverage powerful scheduling capability to schedule any session host actions such as start, stop, add, delete, re-image, resize, activate, deactivate, run script, and more.

Health check probe for third-party tool monitoring

Get status of Nerdio Manager, SQL DB, Azure and AVD access via an unauthenticated URL. Can be used by monitoring tools to check environment health.

Define global variables that can be used by any scripted action. Variables are encrypted and stored securely in Azure Key Vault.

Nerdio Manager provides built-in integrations for popular desktop virtualization tools such as Teradici PCoIP, security and AV tools like Sophos, and much more.


Use Scripted Actions to install and manage applications on desktop images or during session host VM creation. Large library of popular software installations is included and gets updated on a regular basis. Create your own scripts to install and manage your own apps.

Applications installed on images or session hosts are automatically discovered and can be assigned to only some users and groups (whitelist) or be available to all users with exceptions (blacklist). Leveraging FSLogix application masking technology, apps are completely removed from user’s environment unless user is authorized.

Create MSIX images using msix apps, store them in an Azure Files based library with versioning, and deliver these apps seamlessly to users.

Upload native MSIX installer files and let Nerdio Manager automatically expand them into a VHDX container, capture all needed metadata, and make the app available for host pool attachment.

Upload multiple MSIX apps to be packaged together in a single VHDX image. Combining multiple apps in a single image reduces the number of VHDX files mounted on each session host VM and improves performance.

Upload and manage MSIX App Attach images to an Azure Files share. Update images to new versions and automatically apply to all host pools with existing assignments. Leverage images with multiple MSIX packages inside for more efficient app delivery.

Leverage native WVD MSIX App Attach integrations via the AVD agent. Assign MSIX packages to host pools from Nerdio Manager image library or use existing images storage on any SMB storage including Azure NetApp Files and file servers.

Upload and manage a library of self-signed or CA-issued certs that were used to package apps in MSIX format. These certificates can be automatically installed on desktop images or session hosts during provisioning.


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