Microsoft purchased Connectix in 2003, and since that time Microsoft has worked hard to establish a credible server-side virtual machine (VM) environment that competes with EMC's VMware. For the past few years, Microsoft's VM products have performed admirably in the VM arena, although most would agree that VMware continues to offer better features and performance. To narrow the gap, Microsoft has engaged in an aggressive price war with VMware. Will Microsoft's integration strategy pay off or will VMware's software solutions win out? Here's what you need to know about Virtual Server 2005 Release 2 (R2), Microsoft's latest VM server solution.

Licensing
When Microsoft shipped Virtual Server 2005, VMware was quick to point out its many flaws, and many reviewers agreed: Although Virtual Server 2005 was a decent solution, it didn't offer features such as USB, x64, and Linux support, and it didn't provide the performance levels that VMware ESX Server and VMware GSX Server achieved. In January 2006, Microsoft tried another tactic: It lowered the cost of Virtual Server 2005 Enterprise Edition from $999 to $199 and the cost of Virtual Server 2005 Standard Edition from $499 to $99. EMC, not surprisingly, responded by rebranding VMware GSX Server as VMware Server and reducing the cost to zero.

At the LinuxWorld Trade Show in April 2006, Microsoft announced that Virtual Server 2005 R2 Enterprise Edition was available. Like VMware Server, Virtual Server 2005 R2 is free to customers. Similar to VMware's offerings, Virtual Server 2005 R2 natively supports both x64 (64-bit) and x86 (32-bit) Windows server environments.

Microsoft tells me that the no-cost approach isn't a competitive strategy but rather has more to do with the company's vision of virtualization. Microsoft believes that virtualization should eventually be made part of the OS, and the company is working to add a kernel-level virtualization technology (called the hypervisor) to Longhorn (the next version of Windows Server, currently due in 2007). According to the software giant, this integration, along with supporting hardware virtualization features in AMD and Intel microprocessors, will eventually lead to dramatic performance gains that aren't possible with VMware Server or Virtual Server 2005 today.

However, Microsoft says that customers who adopt Virtual Server 2005 and its Virtual Hard Disk (VHD) format today will have a seamless upgrade path available when Longhorn ships. And that, presumably, is a major advantage that the VMware platform doesn't provide.

Linux Support
Another feature available in Virtual Server 2005 R2 is support for Linux VM installations—a major departure from Microsoft's past stance against supplying support for a competitor. One might even argue that Virtual Server 2005 was geared more toward legacy Windows NT Server 4.0 server consolidation than anything else, making the likelihood that a customer would need a Linux-based configuration fairly remote.

That's not what Microsoft heard from its customers. So now, Microsoft is supporting Linux in two ways. First, Virtual Server 2005 R2 will ship with installation templates designed specifically for the most popular, current server-based Linux distributions, including Novell's SUSE Linux Enterprise Server 9 and SUSE LINUX 10.0, 9.3, 9.2, and 9.1; and Red Hat's Enterprise Linux 2.1 (Update 6), Enterprise Linux 3 (Update 6), Enterprise Linux 4, and Red Hat Linux 9.0 and 7.3. Additionally, Microsoft will supply free Linux-based VM add-ons that will let Linux VMs integrate more closely than is otherwise possible with the host OS.

Second, Microsoft will provide support (through a third-party company) for customers who run Virtual Server 2005 R2 with one of the supported Linux distributions. This support is a big step for Microsoft: If a customer has a problem with a supported Linux distribution running under Virtual Server 2005 R2, the customer can use Microsoft's customer support. Previously, Microsoft supported only various Windows versions and legacy versions of OS/2 and MS-DOS.

Recommendations
Given the price and new Linux support, it's hard not to recommend Virtual Server 2005 R2. There's just one question: Does this product outperform or at least effectively compete with VMware Server? VMware Server is still in beta, so it's too early to make the comparison. You need to consider your organization's future plans: If your organization plans to run its virtualization platform on top of Linux, consider VMware Server because it supports Linux as the host environment; whereas Virtual Server 2005 R2, naturally, supports only the latest Windows Server versions as a host. However, if your organization plans to use Windows Server for the foreseeable future, investing in Longhorn with the hypervisor service might be the best solution.