More than half of enterprises with 100 to 500 employees are looking at server virtualization. Even among enterprises of less than 100 employees, a solid minority is exploring the technology. However, when it comes to a new technology, smaller enterprises are typically more cost conscious than their larger counterparts.
This research note explores the following:

• Since 2006 Virtual Iron has been working to compete with market behemoth VMware.
• Virtual Iron bases its products on the open source Xen hypervisor.
• The company recently released version 4.2 of its enterprise virtualization product.
• Expect prices for all virtualization products to be driven down by heightened competition in 2008.
• Smaller enterprises should explore the Virtual Iron alternative.

Virtual Iron is a legitimate competitor to VMware and offers a compelling lower cost alternative to smaller enterprises. However, Virtual Iron is not a perfect fit for every situation. VMware should also remain on the consideration short list.