NEC enhances user experience with 90,000 Azure Virtual Desktop instances

Three challenges block extensive deployment of on-premises VDI for a modernized work style

Since its founding in 1899, NEC has grown into a global tech company that covers everything from the ocean floor to outer space. It’s recognized as the world leader in facial, fingerprint, and iris recognition technologies, with the NEC Group employing over 100,000 people and generating revenue of around 3.5 trillion yen in the 2023 fiscal year. NEC not only drives advanced internal DX initiatives by positioning itself as client zero^*, it returns and circulates knowledge from this process to customers and society. The company advances internal DX in three key areas: work styles, sales and core business, and operations. Additionally, its 2025 medium-term business plan targets an average annual EBITDA growth rate of 9% and an engagement score of 50%.

“With work style DX, we’re promoting modernization,” says Kazuhiro Oguchi, an Executive Professional from the NEC IT Infrastructure Services Department. “This involves creating ‘location-free’ environments to maximize performance and results at the best time and place; ‘communication hubs’ where teams cab come to the office at the appropriate time to exchange opinions openly in a welcoming space; and ‘innovation hubs’ to work with customers and partners to create business faster.” Oguchi explains the background of these initiatives below.

“NEC established its first satellite office in Japan in 1984. We’ve been creating comfortable work environments for over 30 years, including working from home for researchers, flexible work hours for the entire company, and teleworking to assist with childcare and nursing. Our current efforts take these further.”

To that end, NEC enlisted the support of executives and launched Project RISE in 2018. The company is assertively reaching toward a culture that keeps on reinventing itself with a modern work style based on thin clients and cloud services.

“In 2018, just under 30,000 employees were using thin clients, and transitioning to Windows 10 accelerated this trend,” says Oguchi. “With the spread of COVID-19, 70,000 employees were using the technology in 2022.

The VDI platform was on-premises architecture with servers located in NEC’s data center. However, the skyrocketing user numbers created three main problems.

Azure Virtual Desktop deployment solves challenges, reaches 90,000 users in just two and a half years

NEC’s first problem was a lack of network bandwidth. With more employees working from home, use of web conferencing expanded. Accommodating VDI access from users and connections to cloud services required mammoth data center bandwidth. NEC had bandwidth of 40 Gbps between its intranet and the internet, but this was insufficient for VDI with tens of thousands of users.

Second, the VDI desktops provided limited performance. With desktop consolidation rates on the on-premises infrastructure rising to support a massive number of clients, users had to compete for resources.

Long lead times for desktop provision were a third challenge. Procuring servers was difficult, especially during the global supply chain disruptions amid the COVID-19 pandemic.

“Even when the supply chain was normal, it took about four months to procure hardware and data center racks,” recalls Yusuke Nakamura, NEC IT Infrastructure Services Department Professional. “Even though our vendor offered a new virtual desktop model, it would take about a year from the planning stage to provision. We also needed to use CAD on thin clients, but we couldn’t make investment decisions because of the difficulty of demonstrating investment returns beforehand.”

NEC believed that further promoting a modern work style would be tough given the challenge of achieving a satisfying desktop environment. To surmount this problem, the company introduced Azure Virtual Desktop. In October 2020, six months after the pandemic necessitated working from home, NEC began examining system deployment. After conducting a technical test with 10 to 20 employees from January 2021, the company decided to introduce the system in June 2021 and started building an extensive environment.

“We performed technical comparisons with other companies’ cloud-based VDI, but Azure Virtual Desktop had numerous advantages, including compatibility with Microsoft 365, robust security, and authentication using Microsoft Entra ID (formerly Azure Active Directory),” says Oguchi. “NEC’s burgeoning strategic partnership with Microsoft also drove our Azure Virtual Desktop adoption.”

In October 2021, NEC released the new system to hundreds of internal users. Six months later, the userbase had expanded to 10,000. The number of Azure Virtual Desktop users continued to grow, reaching around 90,000 as of the end of June 2024. This is one of the world’s leading examples of large-scale use.

“For deployment on such an extensive scope, we had Microsoft Unified Support add new features for a better user experience, provide deployment support, and supply specific suggestions on the best virtual machines (VM) for Azure Virtual Desktop,” says Nakamura. “Microsoft responded swiftly when problems arose. This excellent support was a major factor in us managing a massive migration of 90,000 users in just two and a half years.”

Solving all the challenges of on-premises VDI and offering multiple desktop models

Shifting from VDI to Azure Virtual Desktop eliminated NEC’s first challenge of network bandwidth bottlenecks. Microsoft Teams and other major web conferencing services have Azure Virtual Desktop client modules which optimize communication paths as a standard feature. Therefore, bandwidth-intensive voice and video communications can take separate paths than those of remote connections to Azure Virtual Desktop (see Figure 1)

Hiroyuki Kii, Director of NEC's Cloud Development Division, explains the convenience of this service. “Our on-premises VDI lacked the bandwidth to make voice and video calls, so we used two device types: thin clients for accessing VDI for data sharing and smartphones for voice and video. We can now join web meetings with one thin client without the audio and video delays of the past.”

NEC conquered its second challenge, desktop performance, by using Azure Virtual Desktop single sessions to avoid resource contention between users.

And the third challenge, lead times, is also in the past. With Azure Virtual Desktop, there’s no need to procure hardware or data center racks to add new users, so NEC can handle thousands of additional Azure Virtual Desktop clients every month.

“We can easily add new desktop models without fresh investment,” says Nakamura. “We started by providing standard business desktops with Azure Virtual Desktop, and then added high-load models and CAD/video editing models. From planning to release, it took around three months for the high-load models and two months for the CAD models”.

It's also easy to migrate between standard business models and models for high-load work. Users can simply switch the specs of the VM which Azure Virtual Desktop is running; no changes to the existing desktop are necessary. 

“The ability to choose a model to suit requirements is remarkably convenient,” says Mari Wada, NEC Service Business Department Manager. “I started with the standard business model, but eventually switched to the high-load model: I was able to migrate quickly without having to move any data or applications.”

According to Wada, the system's straightforward authentication is also a better experience. When connecting from outside the office in the past, users had to perform an authentication procedure for the virtual private network (VPN) before logging into Windows. With Azure Virtual Desktop, all they need is a Microsoft Entra ID.

NEC plans to upgrade the operation of its Azure Virtual Desktop environment while leveraging multiple Azure services. The company is already using Azure Functions to automatically turn power on and off to reduce costs while visualizing and optimizing its usage environment with Azure Monitor.

It is also providing customers with the experience gained from deploying Azure Virtual Desktop to 90,000 users. In October 2022, the company launched NEC Virtual Desktop for Microsoft Azure, which blends Azure Virtual Desktop with NEC's knowledge. In a little over a year and a half, the company has sold tens of thousands of seats.

“In May 2024, we announced a new value-creation model, BluStellar, which also incorporates Azure,” says Kii. In addition, NEC's Inzai Data Center, which has connection points with multiple public clouds, is one of the few data centers owned by Japanese SIers that directly connects to Azure in a closed network, enabling highly secure proposals. “No other SIer has experience with such an extensive Azure Virtual Desktop deployment,” Kii continues. “We want to actively help Japanese customers reform their work styles by providing our experience as client zero.”

* Client zero: An approach in which a company positions itself as its initial client, thereby promoting DX for customers and society by offering lived experience and value.