Reason 1: Baked-in
Red Hat, Novel, and some say Sun too, will integrate the hypervisor product into their operating systems creating what eWeek called “baked-in” virtualization. This gives the vendors an edge freeing their users from the one OS to one machine bond. Microsoft is also expected to do the same, but no one is sure when that will be. Baked-in virtualisation is something that VMware can’t offer at all.

Reason 2: Windows Support
Not too long ago, the VMware differentiator from the open source and Microsoft virtualization technologies is that Xen only ran Linux, and Microsoft Virtual Server only ran Windows. VMware ran both and Solaris too. But that argument is officially dated. XenSource has since released the new XenEnterprise package that, you’ve guessed it, runs Microsoft Windows. But don’t expect Microsoft to borrow code from the open source community for integration with its upcoming virtualisation-enabled server OS.

Reason 3: Virtual Iron goes Xen
Being a smaller player in the virtualization game, Virtual Iron, as CNet reports, “has scrapped its own virtualization software in favor of the open-source Xen project.” Basically Xen just got Virtual Iron’s market share and as long as it remains open, it’ll continue to grow.