Today, Microsoft announced the pending availability of Windows Server 2008 Foundation, a new entry-level version of its popular infrastructure server product line. Foundation is aimed at very small businesses—those with 15 or fewer employees—and will be sold only with new entry-level server hardware. Microsoft is positioning the server as an inexpensive alternative to Linux and, in developing countries, to pirated versions of Windows Server.

"Today we are launching a new server-based solution with the right technologies at the right price to give small businesses access to the power of server-based business software," says Microsoft CEO Steve Ballmer. "Small businesses around the world have big business dreams and needs. We see this as an opportunity not only to deliver a technical foundation for business growth but also to create a financial foundation for community."

Microsoft sees Foundation as its new entry-level product, and as such it supplies only basic server functionality. It doesn't include the Hyper-V virtualization capabilities from the higher-end Windows Server 2008 products, nor does it include the integrated email, database, and management capabilities of Small Business Server. However, customers who opt for Foundation can easily upgrade to other Windows Server products as their needs grow.

Foundation will become available via new server purchases in the coming months and will be initially sold in 40 countries and in several languages, beginning with English, Traditional and Simplified Chinese, Japanese, Brazilian Portuguese, Spanish, and Turkish. From now through the end of September 2009, a portion of every Server 2008 Foundation sale will go to TechSoup.org and Telecentre.org, two nonprofit organizations.

Although pricing for the server will be set by server makers, I've been told to expect the machines to be very inexpensive, leading to the possibility that Foundation will be an interesting alternative for tech enthusiasts to use the system as PC. When he previously hinted at the existence of this product recently, Ballmer referred to it as a netbook-type solution for the server, further reinforcing this notion.