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The software, which should ship by 1 October, is Microsoft’s response to clear server partitioning leader VMware – a unit of EMC. However, this arrives four years behind VMware, two years behind target and without most of the high-end features – most notably support for Linux – now common in VMware’s ESX Server product. But Microsoft can offer customers something VMware can’t, and that’s Microsoft support for software running on a virtual machine or partition and a cheap price.

Microsoft has turned away customers looking for partitioning help once they admit to running Windows on a spliced server via VMware. It’s not a practice Microsoft is terribly public about, but it is well-known policy. To offset this, VMware has teamed up with big boys such as IBM, HP and Dell to help out customers and take care of Windows support issues.

VMware’s strong alliances have vaulted it to a unique state in the market for servers based on Intel and AMD processors. The large server OEMs have all agreed to resell VMware’s products instead of building partitioning tools of their own. For IBM and HP, in particular, this is a major role reversal compared to their Unix server strategies, where each vendor writes its own complex partitioning code.

This shouldn’t be surprising since the x86 server market enjoys far more standardization than the RISC and Itanium market. The whole idea is to keep software costs as low as possible, since the x86 space is largely a commodity market.

The downside of VMware, and software like it, is that it’s years behind similar Unix tools. IBM, HP and Sun Microsystems have all released fairly amazing stuff for running multiple workloads on a single server and tweaking the processing power, bandwidth and storage for each partition. In many cases, this software is tied into the vendors’ larger utility computing and capacity pricing models. This brings customers closer and closer to the promised virtualization orgasm where servers and software manage themselves.

VMware’s software is well-respected but not on the level of these Unix tools. Both ESX Server and GSX Server are primarily used for software development and testing. Customers can see how well software packages work on different versions of an operating system and test out patches. They can do all of this on a single server instead of spending loads of cash test systems. There are production deployments but not an overwhelming number of them.

Microsoft comes in lower on the totem pole. It acquired a product from Connectix, once meant to ship in 2002, and then spent 18 months retooling the code. The original Connectix code was based on the company’s Virtual PC software for running multiple OSes on the same desktop, and one can only hope Microsoft moved well away from this low-end software with its server product. Sadly, this doesn’t seem to be the case as Microsoft still requires a host operating system to run Virtual Server, while VMware’s ESX server uses its own operating system – a feature which makes many of the more complex partitioning functions possible.

In addition, Microsoft only supports one extra OS per processor, while VMware can support up to eight partitions per processor. VMware has tools for clustering virtual machines, adjusting processing power for different software workloads and disaster recovery technology. Microsoft is still working to catch up in all these areas.

Microsoft’s Virtual Server can run Windows, Linux, OS/2 and just about any other x86 operating system, but it won’t support non-Windows OSes. In a market based on the premise of helping customers consolidate their products, this is a big drawback. Microsoft’s lack of support seems like a political decision – and one for which customers have every right to complain.

- Cleaning house
To Microsoft’s credit, it’s not pricing Virtual Server as if it were a real competitor to VMware. At $499 for the standard edition (up to 4 processors) and $999 for the enterprise edition (up to 32 processors), Virtual Server comes in more as a handy tool than a consolidation miracle. Customers can get rid of some old servers running ancient Windows apps and bring the software over to a single, powerful new server. It’s really more for cleaning house than total data center reconstruction – something companies such as Qualcomm have done with VMware.

VMware’s high-end ESX Server product comes in around $4,000 for 2 CPU systems, $7,000 for 4 CPU systems and $15,000 for 8 CPU systems. GSX Server starts close to $2,000 for a 2 CPU box.

So, if you have some nagging applications hanging around that currently demand their own server, Microsoft’s product might be the right choice for you. Just pop the suckers onto a single box and work with Microsoft to keep crashes at a minimum. This should be a fairly common scenario for mostly Microsoft shops, especially with Redmond providing support.

If, however, data center consolidation is your game, then VMware should probably be your partitioning vendor of choice. Customers can run more virtual machines, use more management tools and put both Windows and Linux on the same box. It will cost you more, but the quality is worth the price.

Over time, customers can expect virtual machine technology to improve considerably. Intel, for example, is currently working on its Silvervale partitioning technology. This will handle many of the calls typically done by software in hardware and improve the performance of both VMware and Microsoft’s code.