What is it?

You will see Virtual Desktop Infrastructure discussed as VDI. The idea is that you host your desktops at a remote location instead of locally. Why would anyone want to do this? VDI provides administrators a centralized location for all user environments, allowing users to connect to their desktop from just about anywhere. A user could be at the office, disconnect from their desktop, and re-connect at home or another office, never closing their applications. No more synchronization of files or email. Administrators are happy because they can quickly provision a desktop, control licensing, and control access to hosted resources easier.

Advantages

• Users' desktops can be accessed from anywhere (or have restricted access from specific machines)
• Desktops run on highly-available infrastructure
• Disaster recovery works just like with servers
• Access to low-speed and high-speed storage
• Very fast provisioning of desktops
• A library of desktop images can be kept, allowing admins to choose a desktop image to clone
• Snapshots of desktops can be performed (for developers, for example)
• Hardware-agnostic - desktops no longer rely on the underlying hardware, only virtual hardware

How does it work?

There are 2 approaches. Virtual desktops can be virtual machines that run a desktop OS such as Windows XP, Vista, or 7. Or, virtual desktops can be a remote desktop session running on a Windows server.

Microsoft has licensing restrictions on what service providers can deploy which require customers who wish to run a desktop OS such as Windows XP, Vista, or 7 to pay for a VDA license (Virtual Enterprise Centralized Desktop license). Microsoft has more information here.

Network World has an article that discusses pricing for VDA licenses here.