With the release of VMware vSphere 4.1 this week, VMware hopes to lure the elusive and price-conscious small and midsize businesses that are still, in many cases, in the early stages of trying to figure out their virtualization strategies.

Among the laundry list of new features in VMware vSphere 4.1 are changes to VMware's licensing at the low end of its product line -- changes designed to appeal to the SMB market that has been complaining about high prices and missing features.  While VMware has the lion's share of the enterprise virtualization market, the SMB market is splintered among VMware, Microsoft, Citrix, Parallels, and other Xen and KVM offerings.  Microsoft Hyper-V and Citrix XenServer have been gaining a lot of attention in the SMB market because of their free and low-cost SMB offerings that include such customer feature favorites as live migration and high availability (HA).

With vSphere 4.1, VMware answers that challenge by making its vMotion live migration feature available for the first time in the VMware vSphere Essentials Plus and Standard editions.  As an added bonus, VMware has upgraded its vMotion technology to deliver a 5x increase in migration speed while supporting up to eight simultaneous migrations between two physical servers.

In an effort to entice SMB customers, the company has been running a promotional price on its entry-level Essentials license, lowering the price from $995 to $495.  Evidently it helped, because VMware now says it is going to make the price cuts permanent.  At a price of $495 for six CPUs, that brings the price down to $83 per processor -- a very affordable price for an SMB shop.  The only problem is that this edition doesn't offer live migration or HA capabilities, both of which can be found in the free version of Microsoft Hyper-V R2. 

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Read the rest of this InfoWorld Virtualization Report article here.