Sun surely believes in virtualization.
It offers its own OS partitioning solution, Solaris Containers (aka Zones), for free in its free enteprise grade operating system Solaris 10.
It has been the first company launching a rentable general-purpose grid service, Sun Grid, based on Solaris Containers.
It is going to allow execution of other operating systems binaries on Solaris, with the Solaris Containers for Linux Applications (formerly BrandZ).
It will port Xen open source hypervisor capabilities in its operating system, allowing to run a whole operating system inside a virtual environment, not only a binary.
It will introduce network virtualization in future updates of Solaris 10, with Project Crossbow.
Now Sun goes further with a new OS partitioning feature called Logical Domains (LDoms) and available only for Niagara processors (powering Sun Fire T1000 and T2000) since early 2007.
LDoms, which is planned to be a complement of Solaris Containers (working with all others SPARC and x86 processors), will allow to run up to 32 containers of Solaris 10 on a single Sun T server.