What does it mean for VMware and competitors?
VMware has indicated that the intent behind making VMware Server a free product was not a response to market pressures, but was simply a way to open VMware products to a new class of users. Regardless of the reasons behind the move, here are some thoughts regarding the virtualisation market and the impact that VMware's actions will have.
VMware
It's hard to believe that VMware will actually lose any money as a result of this announcement. GSX Server was not their primary source of revenue and the position of VMware Server as an entry-level virtualisation platform can only help to drive sales of services and additional products. VMware has indicated that VMware Server will eventually be supported under VirtualCenter, which customers will have to pay for. Further, once customers test the virtualisation waters with VMware Server, they may be more willing to consider the ROI that could be achieved through ESX's more efficient use of hardware resources.
As Xen gains maturity and a mainstream audience and Microsoft gets their hypervisor product into gear, VMware will begin to feel more pinched, although VMware has, by far, the most advanced management tools of the crowd.
Microsoft
At US$99, Microsoft is already practically giving away Virtual Server 2005 R2 and has been playing catch-up on the virtualisation front for the past couple of years. With R2 and the upcoming 2006 release of the product, Microsoft's product will have a feature set comparable to VMware Server, including support for Linux guests. However, Microsoft does not yet have the powerful virtual server management tools provided by VMware, making it less attractive for larger organisations.
Expect Microsoft to lower the price of Virtual Server to $0 at some point to match VMware's play. After all, Microsoft will still make money on the sale of Virtual Server since a Windows licence is required for the host system. Microsoft wants to keep Virtual Server on a level playing field with VMware Server until they release their hypervisor-based virtualisation product sometime within the next couple of years.
Xen
In a heterogeneous data centre, the current version of Xen -- 3.0 -- can't hold its own against VMware since Xen cannot reasonably support Windows hosts. However, as Xen matures, develops better management tools, and gains the ability to run Windows through Intel's VT and AMD's Pacifica technologies, expect Xen to become a more serious contender and threat.
How will VMware's announcement affect the open source Xen project? Probably not too much, although some people testing virtualisation with Xen may now give VMware a shot, too.
SWsoftVirtuozzo
This is one virtualisation product that I have not yet had the opportunity to evaluate, so I can't really comment on how it compares with VMware.
A good thing
To be sure, VMware's release of VMware Server as a free product is a good thing for customers that want to be able to truly evaluate virtualisation in their environments. It's also a good thing for VMware, a company that has long led the pack in the virtualisation market. Although the company insists that their decision was not market motivated, the decision does show that the company continues to be open minded to making changes that will help maintain and increase the market that they have built over the past few years.
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I invite you to take a look at VM6, Virtual machine EX.
http://www.vm6.ca/product/vmex/default.aspx
This product allow to run Vmware GSX virtual server as cluster resource on MS cluster and allow to do real time virtual server migration from one node to an other (similar to Vmotion on ESX).
Large scale enterprises are using the product in production environment for more then tree year.
The product is so innovative and reliable that VM6 had been invited by VMware to present it at last VMworld 2005.
VM6 will announce a new version of is Virtual Machine in few week.