Quoting the press release:

Microsoft Corp. and XenSource Inc. today announced they will cooperate on the development of technology to provide interoperability between Xen(TM)-enabled Linux and the new Microsoft® Windows® hypervisor technology-based Windows Server® virtualization. With the resulting technology, the next version of Windows Server, code-named "Longhorn," will provide customers with a flexible and powerful virtualization solution across their hardware infrastructure and operating system environments for cost-saving consolidation of Windows, Linux and Xen-enabled Linux distributions.

"Microsoft's commitment to customers is to build bridges across the industry with solutions that are interoperable by design," said Bob Muglia, senior vice president of the Server and Tools Business at Microsoft. "Our work with XenSource, a recognized leader in open source virtualization technology, reflects that commitment and Microsoft's ongoing efforts to bring virtualization solutions to the mainstream and help customers progress toward self-managing dynamic systems."

"We are pleased to collaborate with Microsoft as a development partner and to deliver interoperable virtualization solutions," said Peter Levine, president and CEO of XenSource. "Xen-enabled guests will run seamlessly on XenEnterprise now, and, as a result of this agreement, Xen-enabled Linux guests will also run on Windows Server virtualization. XenSource will also deliver additional products based on the collaboratively developed technology, further expanding the value of the relationship."

Benefits for Customers

The joint efforts between the two companies will deliver the following customer benefits:

    -- Interoperability by design through collaborative development of two
       leaders in virtualization technology
    -- A flexible, high-performance and more reliable virtualization solution
       with Windows Server "Longhorn," optimized to support heterogeneous
       software environments and a wide array of hardware
    -- Microsoft technical support for issues regarding interoperability with
       Xen-enabled Linux guest operating systems through the standard
       Microsoft technical support process

    Availability

Microsoft anticipates providing a beta release of Windows Server virtualization by the end of 2006 and plans to release the solution to manufacturing (RTM) within 180 days of the RTM of Windows Server "Longhorn," which is targeted for the end of 2007. Microsoft currently provides virtual machine add-ins and technical support for Linux guest operating systems running on Virtual Server 2005 R2.

This agreement builds on an ongoing relationship between Microsoft and XenSource. XenSource has previously licensed the Microsoft Virtual Hard Disk format to enable interoperability with Microsoft virtualization technologies. For customers with Premier-level support agreements, Microsoft will use commercially reasonable efforts to address potential issues with Microsoft software running in XenEnterprise.

Thanks to Richard Cardona for the news!