Microsoft To Launch Virtual Server 2005 Next Week

Microsoft will formally launch its long-awaited Virtual Server 2005 early next week, sources said.

The virtualization software, which Microsoft acquired from the former Connectix in February 2003, runs on Windows Server 2003 only but supports Windows NT and Windows 2000 workloads. It will compete with EMC's VMware and SW-Soft's Virtuozzo, which allow for server consolidation and simplified management of applications.

Pricing has not yet been released but sources expect the Standard Edition to come in at around $500 and the Enterprise Version to cost roughly $1,000. Sources also said Microsoft is going to offer incentives to partners, but it was not yet clear what those incentives entailed. Both versions are expected to be available within a month.

Microsoft released the beta version last February and Release Candidate 1 in June. Originally, the Redmond, Wash.-based company hoped to ship an enhanced server by the end of 2003 but delayed it to work out technical issues. The last targeted date for release was mid-2004.

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"They're doing a low-level launch, district by district," said one source familiar with the company's plans. "This is largely being driven [by] customers who want this software now. Microsoft would prefer to hang and do a bigger launch, but they've been so late they want to do it now. "

Many customers, including Allstate Insurance and Winn-Dixie, have the final bits in house and have been using the release candidate in production for several months, solution providers said.

Microsoft plans to ship two versions of the virtualization software. The Virtual Server 2005 Standard Edition will support up to four processors, while the Virtual Server 2005 Enterprise Edition will support up to 32 physical processors, Microsoft said.

While detractors say most companies will use Microsoft's version 1.0 software purely for testing, development and staging legacy applications, some "leading-edge customers" are using it for mission-critical apps such as billing and inventory applications, sources added.

Microsoft advocates its use for server consolidation, testing and development of applications and NT migrations. Almost all of the workloads running in virtual machines are legacy line-of-business NT workloads, but there are some Windows 2000 workloads running in virtual machines, sources said. According to documents previewed by CRN, Microsoft Virtual Server will offer multithreaded servers, a Web-based console for management and COM APIs for scripted virtual machine management.

A top Microsoft partner said the gold code is out and that the release will push server consolidation in the Microsoft environment.

"The RTM bits showed up last week," said one Microsoft services partner. "This means you can run Linux on Windows ... or most other mainstream operating system platforms on a Windows 2003-based machine. With W2K3 running on big Itanium 2 boxes, who needs [Sun] Solaris?"

One VMware partner said the entry of a virtual software product from Microsoft may slow purchasing decisions, but he is confident VMware will continue to do well. "I'm not worried because Microsoft's Virtual Server provides only a subset of the capabilities of VMware. Microsoft is really putting this product into play to help organizations migrate to 2003 from NT," said Mitchell Northcutt, president and CEO of Chicago-based RapidApp, a VMware partner.

"I think there is a potential for the sales cycle to be extended in some cases while some Microsoft customers consider trying to accomplish virtualization efforts with Virtual Server. I do not think it will take them long, however, to realize the limitations of using Virtual Server."

In an interview Wednesday morning, one key VMware executive said he is confident that VMware's product line will leapfrog Microsoft's version 1.0 debut.

"They both do virtualization to some degree, but we have a whole virtual infrastructure strategy that Microsoft does not, and it's a core IT strategy," said Michael Mullany, vice president of marketing at VMware, Palo Alto, Calif.

"For Microsoft, it's a niche product aimed at migrating NT workloads to Windows Server 2003 servers," Mullany said.

The VMware executive acknowledged that the company has a significant upgrade of its flagship ESX server in beta testing, version 2.5, but he would not comment on unannounced products.

One ISV that uses Microsoft Virtual Server 2005 was quick to the punch. On Sept. 13, Surgient will announce that Microsoft's own TechNet is the latest customer to implement Surgient's Virtual Demo Management System, which is built on Microsoft Virtual Server 2005 technologies.