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Microsoft Announces Comprehensive Virtualization Strategy to Enable Self- Managing Dynamic Systems

Company unveils new licensing policies for virtualized computing; industry announces support for Microsoft investments in virtua

REDMOND, Wash., Oct. 10 /PRNewswire-FirstCall/ -- Microsoft Corp. (Nasdaq "MSFT") today announced the next step in its Dynamic Systems Initiative, including product investments, third-party relationships and licensing improvements, to ease customer adoption of virtualization technology and enable customers to begin realizing the promise of self-managing dynamic systems.

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Self-managing dynamic systems are information technology (IT) infrastructures that abstract, or virtualize, computing resources, allowing customers to deploy business services more nimbly and be more responsive to business requirements. This infrastructure leverages IT knowledge and business policy, embedded within software models of the Microsoft(R) Windows Server System(TM), to streamline IT operations and free professionals to focus on meeting business goals.

"Customers are on a treadmill of complexity and cost that limits the value IT delivers to the business. Virtualization is a key technology to help liberate IT but must be implemented as part of a broad approach of enabling self-managing dynamic systems," said Andrew Lees, corporate vice president of the Server and Tools Business at Microsoft. "Today we are announcing a new approach to software licensing, a virtualization and management technology road map, and broad industry support to enable customers to more rapidly adopt virtualization technology while also advancing toward our self-managing dynamic systems vision."

New Licensing for Windows Server System Products in Dynamic, Virtualized Environments

In its effort to help customers develop dynamic systems, Microsoft is providing more cost-effective, flexible and simplified licensing for the use of the Windows Server System family of products in virtual machine environments. These enhancements will be offered through volume licensing, starting Dec. 1, 2005. Updated retail and OEM licensing will be available with new product versions, also starting Dec. 1, 2005. (Further details and explanation of these improvements are available in a Q&A with Brent Callinicos, corporate vice president for Worldwide Licensing and Pricing at Microsoft, available at http://www.microsoft.com/presspass.)

* New virtualization use rights for Windows Server(TM) 2003 R2 Enterprise Edition and Windows Server "Longhorn" Datacenter Edition enable cost-effective consolidation. Licenses for the upcoming Windows Server 2003 R2 Enterprise Edition will allow customers to run up to four virtual instances on one physical server at no additional cost, extending the savings customers can realize through server consolidation on the Windows Server platform. Licenses for the Datacenter Edition of the version of Windows Server, code-named "Longhorn," will give customers the right to run an unlimited number of virtual instances on one physical server. * Licensing by running instance improves the value and flexibility of Windows Server System products. Customers will no longer license every inactive or stored instance of a Windows Server System product. Customers can now create and store unlimited numbers of instances, including those for backup and recovery, and pay only for the maximum number of running instances at any given time. * Portable licensing for the dynamic enterprise allows customers to easily deploy and run Windows Server System products on any physical server licensed for the software. Customers can move active instances from one licensed server box to another without limitation, as long as the physical server is licensed for the Windows Server System product. * Per-processor licensing better aligns with resources used. With Windows Server System products that are licensed per processor, such as Microsoft SQL Server(TM), BizTalk(R) Server, and Internet Security & Acceleration Server, customers will have greater flexibility to stack multiple instances on a machine by licensing for the number of virtual processors being used. Catalyzing the Industry to Ensure Customer Success With Virtualization

Microsoft is working across the industry to foster interoperability of virtualization technologies by standardizing virtualization management models and specifications for device virtualization. In addition, Microsoft licenses royalty-free the Virtual Hard Disk (VHD) format, enabling industry vendors to innovate new virtual machine management solutions. A common file format helps improve security, reliability and cost-efficiency for customers and helps ensure a uniform product support system. Customers who invest in the Microsoft VHD format, available now with Virtual Server 2005, will have a clear path forward to future Windows(R) virtualization technologies.

Microsoft today announced that software vendors Acronis Inc., Akimbi Systems, BMC Software Inc., Consonica, Emulex Corp., Gilles Vollant Software, Leostream Corp., PlateSpin Ltd., PolyServe Inc., QLogic Corp., Quest Software Inc., Surgient, Ultrabac Software and XenSource Inc. endorsed Microsoft's open approach to virtualization and announced their plans to build solutions that integrate with Virtual Server 2005 R2 or support the VHD format. Microprocessor and hardware manufacturers including Advanced Micro Devices Inc., Dell Inc., Fujitsu Ltd., HP, Hitachi Ltd., IBM, Intel Corporation, NEC Corp. and Unisys announced support for Microsoft's commitment to joint solutions that will help customers successfully implement virtualization solutions and achieve dynamic systems.

"Virtualization is a key component of Dell's scalable enterprise strategy that is standardizing core elements of the data center, improving utilization and ultimately delivering customers superior value," said Peter Morowski, vice president of software in the enterprise systems group at Dell. "Dell is committed to innovating with strategic partners such as Microsoft to develop technologies that leverage our companies' hardware and software virtualization expertise and create for our customers a more dynamic and manageable computing environment."

Microsoft Virtualization Product Investments

As part of its continued commitment to virtualization solutions, Microsoft will build virtualization capabilities into the Windows platform based on Windows hypervisor technology, planned for availability in the Windows Server "Longhorn" product wave. The company is also increasing its investments in the Microsoft System Center family of products to address resource optimization and virtual machine life-cycle management. Effective management of virtualized applications and resources is essential to customers. Microsoft already provides tools - such as Visual Studio(R) 2005 Team System, Microsoft Operations Manager 2005 and Systems Management Server 2003 - to develop, deploy, monitor and update applications that work in both physical and virtual environments. In addition, Microsoft is investing in enhanced security measures, to appear in Windows Server "Longhorn," that are designed to provide higher security as well as richer and more dynamic platform integrity and identity solutions.

"As virtual machines enter the mainstream and are deployed in larger numbers, manageability, automation, security and software licensing are gradually becoming more important issues," said Thomas Bittman, research vice president and analyst at Gartner Inc. "Over time, as virtualization capabilities are commoditized, these issues will be the real differentiators to help customers create dynamic infrastructures."

Founded in 1975, Microsoft (Nasdaq "MSFT") is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

Microsoft, Windows Server System, Windows Server, BizTalk, Windows and Visual Studio are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries.

The names of actual companies and products mentioned herein may be the trademarks of their respective owners.

Supporting Industry Quotes

"Combining Acronis' real-time disk imaging and backup capabilities with Microsoft's virtualization technologies, and royalty-free Virtual Hard Disk (VHD) license, provides a powerful value proposition for enterprise and hosting customers. Server virtualization is the enabling technology for tomorrow's dynamic data centers, but without comprehensive tools like those offered by Microsoft, enterprises will struggle to fully realize the benefits of the dynamic data centers."

-- Walter Scott CEO Acronis

"Akimbi Slingshot embeds Microsoft Virtual Server 2005 and leverages the Microsoft VHD format specification to provide software developers and QA professionals with a complete solution that simplifies and accelerates software development and testing cycles. In its approach to virtualization, Microsoft has delivered a platform on top of which great software can be built."

-- James Phillips CEO Akimbi Systems

"AMD and Microsoft are working closely together to move businesses to a dynamic 64-bit computing world in which IT resources are intelligently and flexibly assigned as business needs change. The Windows platform, running on the AMD64 processors with the upcoming 'Pacifica' virtualization technology enhancements, will help businesses consolidate resources and experience an efficient and robust virtualization environment while helping to reduce the total cost of ownership of computing resources."

-- Joe Menard Corporate Vice President, Software Strategy AMD

"BMC Software is working with Microsoft virtualization technology as part of our effort to improve the management and optimization of virtualized systems. Our customers are rapidly adopting virtualization to improve server utilization and business service availability. BMC is enthusiastic about Microsoft's software licensing changes, which deliver immediate flexibility and cost savings to customers. BMC plans to extend to Microsoft Virtual Server 2005 R2 many of the same Business Service Management solutions we offer for management of physical servers and other virtual environments."

-- Fred Johannessen Program Executive for Capacity Management and Provisioning BMC Software

"Machine Factory will help businesses eliminate installation and configuration tasks so that technical professionals can concentrate on higher- level activities. Virtual Server 2005 R2 allows the near-instantaneous provision of virtual machines, which Machine Factory configures to any software requirement. We are delighted that Microsoft is increasing its commitment to virtualization technologies. The increased capabilities and open APIs provided by Virtual Server 2005 R2, coupled with the VHD format, are the foundation of our innovative Machine Factory solution."

-- Justin Santa Barbara Founder and CEO Consonica

"Emulex is working closely with Microsoft to support its server virtualization strategy. Virtual servers are designed to improve server utilization and provide management efficiencies, while host bus adapters are the critical linkage to networked storage that ensures the full range of server virtualization benefits are realized. Emulex is committed to delivering a SAN connectivity solution that enables a broader class of servers to harness the benefits of SANs within Microsoft-based virtualized server environments."

-- Mike Smith Executive Vice President, Worldwide Marketing Emulex

"Fujitsu is pleased with Microsoft's new licensing scheme for virtualization technology. Fujitsu is committed to support virtualization technology with our hardware, software products, and solutions in order to enable better resource utilization and flexible system management. By doing so, we will be able to provide our customers with a new value-added IT environment."

-- Yoshiyuki Tanakura Corporate Senior Vice President Fujitsu Ltd.

"WinImage is a powerful utility that allows users to create and edit disk images (hard disks, CD-ROMs, floppy disks, etc). WinImage 8.0 adds full support for the Microsoft VHD format, allowing users to move files to and from a virtual machine's hard drive - even when the virtual machine is not running. Microsoft's open approach to the VHD format and Virtual Server APIs makes it easy to build on the Virtual Server platform and help foster innovation."

-- Gilles Vollant Gilles Vollant Software

"Hitachi Ltd. greatly appreciates Microsoft's new licensing policies for virtualized computing. Hitachi believes our virtualization technology, together with Microsoft's involvement, contributes to the development of virtualized computing in the PC server market."

-- Kazuhiro Fujisaki General Manager, Platform Software Hitachi Ltd., Software Division

"Virtualization is an important step to making IT resources more adaptive to business demands, and Microsoft's new licensing changes deliver value for enterprise virtualization and help increase the use of virtualization software. HP is today delivering robust management for

Microsoft Virtual Server implementations as well as server migration technology to help customers quickly consolidate servers onto Microsoft Windows virtual servers. Through HP's collaboration with Microsoft, we'll help customers break down the physical barriers that impede IT and help customers realize the promise of self-managing, dynamic systems."

-- Rick Becker Vice President and General Manager, BladeSystem Division HP

"IBM is pleased to be working with Microsoft to expand virtualization capabilities in the x86 market. Microsoft's new licensing policies and technology investments complement our xSeries technologies and Windows virtualization strategy, so together we will aid customers in achieving greater system utilization and lowering total cost of ownership, responding more effectively to changing business conditions."

-- Leo Suarez Vice President and Business Line Executive, xSeries Division IBM Systems and Technology Group

"Intel is pleased to see Microsoft taking the necessary steps to enable self-managing dynamic systems which will increase operational efficiency and be more responsive to business needs. These types of developments are supported by Intel's advanced technology road map and our vision of providing increased value through computing platforms. Intel is working closely with Microsoft to supply innovations such as Intel Virtualization Technology as the underlying hardware infrastructure for these enterprise solutions."

-- Diane Bryant Vice President and General Manager, Server Platform Group Intel

"By licensing Microsoft's open Virtual Hard Disk (VHD) format, Leostream can offer a new generation of business continuity solutions that enable a 10x improvement in recovery time and reliability compared with traditional solutions."

-- David Crosbie CEO Leostream Corp.

"Microsoft's new licensing policies for virtualization will be of great benefit to our mutual customers. Advances in virtualization and the combination of products from Microsoft and NEC provide customers with greater flexibility for their IT solutions at lower total cost of ownership. NEC has worked with Microsoft for many years to ensure that Microsoft's virtualization technology and Dynamic Systems Initiative work well with NEC's enterprise management software, VALUMOware, and our Express5800 line of servers. As the use of virtualization expands in the enterprise, NEC will continue to provide highly reliable solutions enhanced by our close relationship with Microsoft."

-- Masato Yamamoto Executive General Manager, Computers Software Operations Unit NEC

"Microsoft Virtual Server 2005 is a critical component in many server consolidation projects that we see today. The combination of PlateSpin PowerConvert and Microsoft Virtual Server 2005 is a proven solution, and we are working closely with Microsoft to ensure that we leverage its technology today and into the future so that we can offer our customers a market-leading solution for optimizing the data center."

-- Eric Courville Vice President of Global Sales and Business Development PlateSpin

"We share Microsoft's vision for leveraging virtualization technology to create a more agile, dynamic infrastructure. Combining our shared data clustering software with Microsoft Virtual Server 2005 R2, we're able to run multiple applications across a highly available and easily managed cluster of physical servers and storage. The result is an ideal solution for large enterprises that aim to consolidate applications in an on-demand utility for a significant savings in management costs."

-- Mike Stankey President and CEO PolyServe

"Server virtualization and SANs will be instrumental in revolutionizing the data center by increasing operational efficiency in both computing and storage. As the leader in SAN innovation, we are excited about our strategic relationship with Microsoft to drive new virtualization solutions that deliver significant value to Fibre Channel and iSCSI SAN users."

-- Frank Berry Vice President, Corporate Marketing QLogic

"Quest's mission is to help our customers make the most of their investments in the Windows Server infrastructure, and with Virtual Server 2005 R2, Microsoft offers an important step forward in the cost-effective use of virtualization technology. By making the VHD format open and available to customers and ISVs, and by providing APIs for managing Virtual Server deployments, they are raising the bar on using virtualization technology to reduce the cost of computing."

-- Darren Mar-Elia CTO, Infrastructure Management Quest Software

"Microsoft Virtual Server enables Surgient to deliver tremendous value to our customers with our on-demand applications. We are thrilled with Microsoft's virtualization plans and investments to enable self-managing dynamic systems. Microsoft's efforts will enable us to deliver even more value to support our customers' sales, marketing, testing and training needs."

-- Bill Daniel President and CEO Surgient

"Innovation, reliability and support have long been the cornerstones to our success. By listening to our customers we continue to add value to our products while delivering solutions that meet their needs. Integrating our P2V technology with Microsoft Virtual Server 2005 R2 will only continue to strengthen our position as an industry leader in backup and image-based disaster recovery."

-- Morgan Edwards CEO and founder UltraBac Software

Microsoft

CONTACT: Rapid Response Team of Waggener Edstrom, +1-503-443-7070, or
rrt@wagged.com, for Microsoft

Web site: http://www.microsoft.com/

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