IT Operations with Windows 365 Cloud PC: 5 Things You Should Know

Coming on the heels of Azure Virtual Desktop (AVD), could Windows 365 present a better option for your customers?

Cloud PC

If you’re evaluating options to deliver desktops from the cloud, you’re probably apprised of the significant developments in end user computing and the rise of Microsoft’s Cloud PC. You may even be thinking about whether Microsoft’s Windows 365 fits into your IT strategy going forward. Coming on the heels of Azure Virtual Desktop (AVD), could Windows 365 present a better option for your customers? While both are cloud-based solutions from Microsoft there are key differences to consider when evaluating whether Windows 365 is the better choice.

Under-the-hood, both AVD and Windows 365 leverage a similar set of Microsoft cloud technologies. Technically, Windows 365 is built on top of existing AVD components but has a different transactional model (fixed price vs. consumption-based) and some unique capabilities that integrate it more tightly into the new Windows 11 operating system. There are two versions of Windows 365 Cloud PCs: Enterprise and Business.

Enterprise Cloud PCs are designed for organizations that have invested in Microsoft Endpoint Manager and are using this powerful platform to manage their existing, physical desktops. Business cloud PCs are designed for individual users and small businesses. They can subscribe to a new Cloud PC and have it ready to use in under an hour. In a nutshell, Windows 365 is a complete SaaS service that is optimized for user experience while Azure Virtual Desktop is a cloud VDI platform optimized for flexibility and control.

As a starting point for deciding which Azure-delivered virtual desktop approach – AVD, Windows 365 Enterprise or Windows 365 Business – is right for your business and IT operations, here are five evaluation areas to consider:

1IT Administration

AVD requires more sophisticated Azure management resources but can also offer maximum flexibility while Windows 365 Enterprise and Business largely replicate PC management, leveraging the same set of Microsoft tools to manage physical and virtual PCs. If you choose to deploy Business Cloud PCs, know that they are not integrated with Microsoft Endpoint Manager (MEM) and do not have a dedicated management portal. They can only be managed by the end user assigned to the desktop while logged into it. Enterprise Cloud PCs are managed via Microsoft Endpoint Manager (MEM) and via the Azure portal for all networking.

Applications and updates, always an IT concern, are handled by MEM, or via images, for AVD. The update and application delivery process in AVD is very flexible and can be fully automated. Enterprise Cloud PCs can be updated via MEM or manual methods. Business Cloud PCs can be updated with Windows updates, manually by the user, or by using third-party management tools. Operating system support is limited with Windows 365 Cloud PCs which only support Windows 10 or 11 Enterprise (single session) since they are dedicated, non-multi-user desktops.


It will pay off if you spend some time analyzing how your IT and development teams will be working and collaborating, using Azure. Due to the hybrid/remote workforce, usage patterns may have changed from the previous on-site days. Windows 365 offers organizations a fixed-price, monthly subscription to a Cloud PC that is dedicated to a user and can be managed using the same tools as a traditional Windows PC. Cloud PC is available at a flat per-user price, whereas AVD is based on Azure consumption.

In general, Windows 365 Cloud PCs are most cost effective when users need dedicated, persistent desktops and will be using them more than 50 hours per week. With users who can be pooled together into multi-session AVD host pools, there is significant infrastructure cost savings to be realized by using auto-scaling.

When it comes to the licensing for the Windows operating system, if your organization already has a subscription license for Windows 10 or 11, there will be no added software cost for Windows when using AVD. For Microsoft 365, the license for Windows 10 or 11 can be purchased as part of the Microsoft 365 subscription.

3Cost and Control

In addition to licensing, AVD and Enterprise and Business Cloud PCs have differences in management and cost. All components of AVD are managed via the Azure portal, PowerShell or third-party management tools. As such, control is more granular, but can require increased expertise to administer.

Enterprise Cloud PCs also require an Intune license for each user who is assigned a Cloud PC Windows 365 SKU. They run in Microsoft’s Azure subscription which means admins don’t have direct access to the VM. However, the VM’s network interface card (NIC) is “injected” into a vNet in customer Azure subscription. All network traffic enters and leaves the VM via the customer-managed vNet. Egress transfer costs are incurred by the customer.

Business Cloud PCs route all traffic through Microsoft-controlled network infrastructure and there is no way for admins to control the inbound or outbound connectivity to/from these VMs. There is currently no way to assign static IPs to Business Cloud PCs. Since these Cloud PCs run in Microsoft’s Azure subscription and are not enrolled in Intune, there is no admin interface to manage them. They can only be managed directly by the user, just like a standalone physical Windows device. 

4End User Experience

This is more of a neutral factor: the end-user experience is very similar in Windows 365 and AVD. Users connect to AVD sessions and Cloud PCs using the same client app, which is available for Windows, MacOS, iOS, Android and as a HTML client. Leveraging the same infrastructure as AVD provides users the advantage of a unified experience across Windows 365 and AVD. The authentication and multi-factor experience will also be very familiar since it leverages Azure AD, which is used for M365 and AVD authentication.

AVD has limited self-service capabilities for end-users. For example, users cannot restart their own desktop VM or log off a hung session with the AVD client app. They need a third-party tool with a self-service portal where such actions can be performed. Windows 365 has a powerful end-user web portal where users can take self-service actions, such as restarting, on their Cloud PCs without the need to contact support.


AVD offers flexibility in what type of OS IT admins want to use. All storage costs associated with session host OS disks and FSLogix profile storage are incurred by the customer via the Azure subscription. Here too, IT admins have full flexibility around the type of storage and the size of storage to use in the AVD deployment, including what to back up and how.

In contrast, FSLogix is not used with Windows 365 Cloud PCs. Since costs are fixed, local SSD storage is pre-defined depending on the selected Cloud PC size, there are no storage options, and auto scaling is not possible, or needed. Additionally, customizable backup and disaster recovery options currently are limited.


Whether your IT and DevOps teams are fully, or part-time remote, cloud-delivered desktops give them the agility and user experience they need. Teams can use the Azure cloud to obtain full access to their personalized applications, work on the device of their choice and more easily collaborate. The choice between using AVD or Windows 365 comes down to understanding how your teams like to work and how much ‘hands-on’ control admins want over storage capacity and cost or controlling connectivity to and from virtual machines. It also requires a careful analysis of usage patterns since AVD is a usage/consumption-based model.

Overall, combining FSLogix with AVD gives you the most flexibility. Windows 365 provides a familiar Windows experience with dedicated desktops that are more static in terms of location. There may be enterprises that want to use a mix of both for different users. This is an option as well, particularly when you use a management tool that allows companies to manage both in a single platform.

All choices, AVD, Windows 365 or a mix of both, free you from the restrictions of on-premises VDI and further helps your DevOps teams work in the best environment to support a hybrid workforce.

Vadim Vladimirskiy

Vadim Vladimirskiy is a visionary expert in the creation and evolution of innovative cloud IT management platforms for the remote work era. He is CEO and co-founder of Nerdio, which empowers companies of all sizes to succeed with Microsoft’s virtual desktop offerings.