Every year, virtualization stalwart Citrix Systems (NASDAQ:CTXS) organizes a user conference called Synergy, which has become a showcase for new trends in the increasingly hot field of application and desktop virtualization. Last month, Intel (NASDAQ:INTC) and Hewlett-Packard (NYSE:HPQ) were both present at Citrix Synergy to announce some new technology related to virtual and hosted desktops.

During the second day's keynote presentation, Citrix, HP, and Intel took the stage together. The presentation included the iconic music from "2001: A Space Odyssey" as a server chassis emerged from the middle of the stage, suggesting that this new technology marks a historic turning point. What, exactly, did the two computing giants announce at Synergy, and what does it mean for the desktop virtualization industry?

Moonshot and Crystal Well
The server that was presented so dramatically was the CS100, a member of HP's Moonshot family. Basically, the CS100 brings together 45 cartridges, each with its own processor, memory, storage, and graphics, which will be used for hosting remote desktops. In general, Moonshot servers aim to drastically reduce space requirements and power consumption by being customized for a particular application, and the CS100 brings this to the resource-hungry world of hosted desktops.

Because the philosophy behind the Moonshot servers is to strip out everything that is not needed to run the application, the CS100 does away with the virtualization layer, and instead runs each of the hosted desktops in its own cartridge, on bare metal. HP claims that this provides better performance and increased security, while removing compatibility issues that might result from virtualization.

Intel's additional news was that the CS100 will now support the company's newly announced Xeon E3 processor, code-named Crystal Well, which incorporates Intel's most advanced graphics solution, the Iris Pro. This means that the Moonshot system, along with Crystal Well, will be suitable for use in graphics-intensive applications such as CAD or video editing, which have historically been difficult to efficiently deliver in a hosted desktop environment.

Virtual graphics acceleration
Intel also introduced another bit of exciting technology at Synergy in the form of its graphics virtualization support. This is relevant in the more classic virtual desktop environment (that is, not on Moonshot) in which multiple desktops share resources like processors and memory. Additionally, Intel has made its Iris Pro Graphics processor available in this environment.

With Iris Pro Graphics, Intel supports both GPU pass-through, in which one virtual desktop gets full use of the GPU, as well as a technology called GVT-g, with which the GPU is shared across different users. Again, this will allow graphics-intensive applications to be delivered remotely to users, but in an environment using virtualization and running on a traditional blade server.

Is this revolutionary?
Interest in virtual and hosted desktops has been increasing for the last several years, but widespread adoption has been held back by, among other things, the cost of the required IT resources and the fact that graphics-intensive applications couldn't be feasibly delivered.

If HP's application-specific Moonshot servers resonate with customers, it could revolutionize the desktop and app virtualization world, which has, so far, relied on virtualization as a fundamental technique to run desktops on traditional blade servers. In particular, it's not clear, yet, how doing away with the virtualization layer would affect Citrix's biggest competitor, VMware, which has been moving aggressively from its core server-side virtualization business into the virtual desktop and app space.

As for graphics virtualization, this has already been available for a year, thanks to a partnership between Citrix and NVIDIA. Still, delivering graphics-intensive applications, whether from a virtualized server or an application-specific one, is a huge opportunity, as it will bring an estimated six-fold increase in the number of workstations that could be hosted remotely. With or without Moonshot, Intel is helping this happen by providing an alternative to NVIDIA's high-end GPUs.

In conclusion
HP and Intel's announcements are a good sign for the desktop virtualization industry. It remains to be seen whether the Moonshot server and Intel's graphics virtualization will catch on and finally bring virtual and hosted desktops to enterprises. Either way, this chips away at the limitations that have been holding back virtual desktops and makes Citrix, which is still holding the leadership position in its market, look good.