The New York Times is reporting that Cisco Systems plans to start selling servers equipped with virtualization software as early as March.

The report cites that Cisco plans to sell a server that combines hardware and virtualization software from Cisco and VMware.  Choosing VMware makes obvious sense from a partner perspective as Cisco holds a percentage share of the company. 

Analysts have stated that a new server product is likely to be aimed at datacenters, a place that Cisco knows all too well and has identified a huge growth in increased traffic.  And if true, the move will put Cisco square in the mix against partners like IBM and HP.