Happy Virtualization Day

In what will no doubt be an ongoing refrain for the foreseeable future, Microsoft this week talked up its significantly enhanced position in the virtualization market. This time around, the company has a key technology partnership, a corporation acquisition, some licensing changes, and a suddenly burgeoning virtualization product line to discuss. The excuse for all this noise making? An event at the Microsoft campus involving 300 early adopters of Hyper-V (Windows Server 2008-based virtualization) and System Center Virtual Machine Manager.

One of the issues Microsoft faces in 2008 is that it wants to trumpet the release of Hyper-V, its first truly sophisticated server virtualization solution and the platform for much of its virtualization work going forward. There's just one problem: Market leader VMware has been-there-done-that and has years of experience and oodles of customers about which it can brag. So although a certain percentage of Microsoft customers are sure to follow the software giant down the road to virtualization nirvana, the company has a tough sell ahead of it until its own product mature.

I was curious to see how Microsoft was going to address this shortcoming, but this week the company provided a surprisingly obvious answer: It is teaming with long-term partner Citrix to deliver a number of Windows Server 2008/Hyper-V based solutions that will provide customers with more choice, flexibility, and capability. Citrix and Microsoft are dramatically expanding their existing relationship and will co-develop Windows 2008-based versions of Citrix Xen Server (Windows and Linux server virtualization) and Citrix Presentation Server (virtualized application delivery), as well as a completely new product called Citrix Xen Desktop (virtual Windows desktops). The companies are also working on the forthcoming version of Microsoft System Center Virtual Machine Manager (VMM), which will seamlessly manage both companies' virtualization solutions.

Furthermore, Microsoft announced this week the purchase of a Silicon Valley startup called Calista Technologies. Although the software giant is still examining how it will roll out Calista's technologies and intellectual property, I was told that the tiny company has considerably advanced assets related to compression algorithms and GPU usage, allowing virtualization solutions to perform as well in software as today's products do via hardware. Microsoft wants this technology as broadly deployed across its virtualization solutions as possible, as it dramatically enhanced the user experience in remote desktop scenarios.

Microsoft is also easing up the licensing costs and restrictions for desktop virtualization. Early last year, the company announced something called the Windows Vista Enterprise Centralized Desktop (VECD), which among other things provides customers with the rights to run Vista on a server and deliver it remotely to users. Since that time, the price point for this distribution was $78 per year, but Microsoft is now dropping that cost to $23, which should significantly expand its attractiveness. Best of all, perhaps, the company is for the first time allowing consumer-oriented Vista versions, Vista Home Basic and Home Premium, to be installed in virtual environments. Previously, only the higher priced business-oriented Vista versions were available for this use.

Finally, Microsoft is trying to make virtualization make more sense to customers. With just 5 percent of servers virtualized today, the market is wide open and ready for massive adoption. To help educate customers about its virtualization solutions, Microsoft this week greatly enhanced its Microsoft Virtualization Web resource, which includes information about all of the company's virtualization products (Hyper-V, Application Virtualization, and so on), whitepapers, best practice guides, and the like.

Virtualization Day is a neat idea, but clearly this is a technology that has legs and huge ramifications for the future. Maybe the company should have simply declared 2008 as the year of virtualization. It's certainly starting to look that way.