CIO.com attempts to explain what it believes you need to know about this buzzword, virtualization.  Covering benefits to implementation challenges.  This four page article covers the following topics: 

What is virtualization?

Virtualization refers to technologies designed to provide a layer of abstraction between computer hardware systems and the software running on them. By providing a logical view of computing resources, rather than a physical view, virtualization solutions make it possible to do a couple of very useful things: They can allow you, essentially, to trick your operating systems into thinking that a group of servers is a single pool of computing resources. And they can allow you to run multiple operating systems simultaneously on a single machine.

Virtualization has its roots in partitioning, which divides a single physical server into multiple logical servers. Once the physical server is divided, each logical server can run an operating system and applications independently. In the 1990s, virtualization was used primarily to re-create end-user environments on a single piece of mainframe hardware. If you were an IT administrator and you wanted to roll out new software, but you wanted see how it would work on a Windows NT or a Linux machine, you used virtualization technologies to create the various user environments.

But with the advent of the x86 architecture and inexpensive PCs, virtualization faded and seemed to be little more than a fad of the mainframe era. It's fair to credit the recent rebirth of virtualization on x86 to the founders of the current market leader, VMware. VMware developed the first hypervisor for the x86 architecture in the 1990s, planting the seeds for the current virtualization boom.

Why would I want virtualization?

The industry buzz around virtualization is just short of deafening. This gotta-have-it capability has fast become gonna-get-it technology, as new vendors enter the market, and enterprise software providers weave it into the latest versions of their product lines. The reason: Virtualization continues to demonstrate additional tangible benefits the more it's used, broadening its value to the enterprise at each step.

Server consolidation is definitely the sweet spot in this market. Virtualization has become the cornerstone of every enterprise's favorite money-saving initiative. Industry analysts report that between 60 percent and 80 percent of IT departments are pursuing server consolidation projects. It's easy to see why: By reducing the numbers and types of servers that support their business applications, companies are looking at significant cost savings. Less power consumption, both from the servers themselves and the facilities' cooling systems, and fuller use of existing, underutilized computing resources translate into a longer life for the data center and a fatter bottom line. And a smaller server footprint is simpler to manage.

However, industry watchers report that most companies begin their exploration of virtualization through application testing and development. Virtualization has quickly evolved from a neat trick for running extra operating systems into a mainstream tool for software developers. Rarely are applications created today for a single operating system; virtualization allows developers working on a single workstation to write code that runs in many different environments, and perhaps more importantly, to test that code. This is a noncritical environment, generally speaking, and so it's an ideal place to kick the tires.

Once application development is happy, and the server farm is turned into a seamless pool of computing resources, storage and network consolidation start to move up the to-do list. Other virtualization-enabled features and capabilities worth considering: high availability, disaster recovery and workload balancing.

Read the entire article, here.