This brings us to what I see as a bit of a fly in the ointment: Apple Hardware. Right now, even the biggest, baddest Xserve you can buy is at best, a fair to middling virtual server. If this is a market Apple would like to be taken seriously in, then the specs on the Xserve have to come up. Move to an 8-core machine, possibly more. Double the RAM size, etc. Virtual servers may not require their own hardware, but they do require hardware resources. Each virtual machine, or VM, needs a non-zero amount of RAM, CPU, network and disk. If you only have 4 CPU cores to start with, that is going to be a limiting factor in a hurry.
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However, that aside, there are some interesting implications here. Obviously, we can expect to see some product announcements from both Parallels and VMware soon. My question is, will VMware create what amounts to "MacESX"? There are reasons for and against, but I hope the "for" wins out.
On the "for" side, it would allow you to really create an Xserve virtualization "farm" in the same way you do with ESX now. Load balancing, being able to use SAN storage to provide redundancy and hardware failover, fast WAN links to create remote "hot" sites, (I grew up in Florida...a remote hot site there has to be a rather long way away...hurricanes are big), etc. These are things that school districts, higher ed, even the SMB market can all use. True, ESX is actually a "host" OS that runs all the VMs on top of it, but I don't see an actual problem with that for Mac OS X 10.5 Server.
The "against" side for ESX is pretty simple: It would be a bit of an orphan. While you could have a farm of Xserves participating in an ESX cluster, with different OS's, and you could even have them in a cluster with Dells, HPs, what have you, VMware would have to take rather positive steps to ensure that whether accidentally or on purpose, you would never have a Mac OS X 10.5 Server VM running on any physical hardware other than Apple's. I'm not even close to silly enough as to suggest this is easy...or hard for that matter, as I really don't know. I would hope that the people who really want this start bugging VMware now, so that they can see a real advantage to "MacESX".Virtualization is not a magic spell, even though it seems to be portrayed that way in the computer press. It does not magically make management and other issues go away. It is not the perfect solution for all your server needs, and if you don't have a lot of underutilized boxes, it may not be a good solution for you at all. (Depending on why they're underutilized. If it's because you can't afford more hardware, then it may in fact be a decent option.) However, it is an excellent tool when applied correctly, and Apple allowing for it will help them maintain and grow their market share, especially in the SMB arena.