I was excited to read vmware's article about their software that converts physical machines to virtual ones - for free.
Here at innotech we are using virtuals for test environments and are soon to deploy them for production. The whole concept offers so much promise.
The march of virtualization is going to be pushing against the phalanxes of Microsoft Previously, in a license scheme that even our Microsoft rep said was brain-damaged, Microsoft required a license for each OS in a virtual whether it was being used actively or not. Which meant you couldn't store different test configurations of your product without paying a fee for each virtual in the 'freezer'. They changed the license so you only need licenses for the virtuals you are currently running which seems more reasonable.
If a company has a Microsoft OS running in five virtuals on a machine, they need to buy five copies of the operating system. With Linux or Solaris they don't need to buy any. The pressure will be to move away from the 'pay-per-virtual' operating systems to free ones.