but you still need valid windows licenses for using virtual server 2005, so the software's free, the licenses are not.

I think there's a clear trend for basic virtualization technology to be free, with high-end products either free or paid for through support contracts. However for the medium term I expect virtualization on the Mac to be chargeable. Ona Windows machine there are limited reasons for needing virtualization, but on the Mac it's the only convenient way to get access to Windows apps so there's a clear value for a large user base.

As you say, one way round this might be for Apple to offer a free product for strategic reasons. I can't se Microsoft offering Virtual PC for Mac for free though, why lower the cost of entry for their users to a competing platform. That would be dumb.

anonymous: Yes, however, (1) if you are running Windows Server 2003 R2 Enterprise Edition, you can run up to four licensed virtual WS2K3R2EE (how's that for an acronym?) in Virtual Server 2005 R2. Moreover, Microsoft supports a number of Linux distros allowing you to run those too. On top of that, some virtualized machines are actually old OSes like Windows NT or DOS that are required for some legacy application that only works with a specific OS. (2) Microsoft Vista Enterprise Edition (workstation, not server) also allows up to four VM licensed images on a PC. If I understand it correctly, this is not limted to Virtual PC 2004/2007 but is allowed even if using some other virtualziation technology with Vista EE. (3) Developers who purchase the MSDN Universal Subscription can, I think, run some number of licensed copies of various Windows OSes in a test environment.

Simon: I'm not sure it would be dumb for Microsoft Virtual PC for Mac for free too (though like you, I'm not sure they will). After all, unlike the case for Windows Server 2003 Enterprise Edition and Windows Vista Enterprise Edition (both which I must admit require special licensing by institutions), Mac users must purchase some kind of Windows XP/Vista license to run a current version of Windows on their Mac (my XP license on my MacBook with Parallels comes from an MSDN Universal subscription license). So, Microsoft would still make $$$ from an XP or Vista license.

@Simon,

You've got some good points, however one thing to consider is that at the moment, you can purchase Office Professional for Mac, and as a result get VirtualPC 2004 for free. At the moment, this is PowerPC only, but there's obviously no technical barrier standing in the way of an Intel version, and instead more of a "how to market this" strategic barrier.

My money is on the idea that part of the reasoning behind Apple's decision to offer Boot Camp instead of a true virtualization environment, has to do with the agreement made a month or two before Boot Camp was released between Apple and MS that would ensure Office for Mac would be made available for the next five years.

In other words, my guess (and this is a 100% shot in the dark guess) is that part of this agreement ensured that Mac would allow MS prioritized access to the virtualization market before entering into this market themselves. Obviously this can't keep third-party vendors from offering up solutions, but a MS-designed/built/supported/integrated solution is going to attract a TON more folks, especially when this product is offered for free, as part of the product that MOST cross-over users have the greatest interest in.

Office.

Who needs VirtualPC when GuestPC is cheaper, smaller and most of all not associated with Microsoft.

I think its a clear indication that Microsoft are having problems making Vista 100% backward compatible with XP. By bundling (for free) a virtual XP, they can allow users to continue to use their legacy apps, thus allowing Vista to break with the past

Tod, you may be right but although MS make money from the Windows licenses it still makes it easier for users to switch their main platform to Apple. Previous virtualisation tech didn't pose this threat because it was so slow but now even if you run critical Windows apps you can still switch to the Mac with little hastle, and people are. This is a threat to MS down the line.

In practice MS may feel it's a small threat, and that because they offer VPC with Office on the Mac they have no choice but to continue to do so as they would lose too much face in the market to withdraw it or fail to upgrade it.

David, if Apple did make such a deal they are extremely stupid. Virtualization is becoming key platform technology quite apart from the specific advantage of running Windows apps on a Mac. This is why MS invested in it in the first place. Such a deal would prevent Apple offering a virtualization system for Xservs for example. Eventualy all OSes will have virtualization built-in seamlessly. MS a trend with Terminal Server and brought the tech in-house. They saw the same trend with virtualization. I can't believe Apple don't see it too.

Having made the claim that Virtual PC 2004 supports a number of Linux distrobutions, it would be nice if someone, (anyone!) could tell me just what distrobutions of Linux will actually detect and use ALL emulated hardware in Virtual PC 2004?!!!

Lance: There's nothing mysterious about Microsoft Virtual PC 2004's device support. It is spelled out pretty clearly in Microsoft Virtual PC 2004 Technical Overview. Graphics adapter, network card, disk drive controller, optical drive (both physical and ISO files), keyboard, and mouse. Devices that require their own USB driver are not supported. I run Ubuntu, CentOS, and Fedora Linux distros under both Virtual PC 2004 and Virtual Server 2005 R2 everyday and found both products to be very useful for this purpose. If you require USB driver support for virtualized Linux installation running on a Windows host, you should take a look at VMware's products. Their products provide some USB device connectivity support (I use VMware ESX on a limited basis).