Microsoft's Hyper-V version of Windows Server 2008 is now available for download as of yesterday, and Redmond claims it will help firms with multi-server data centres cut costs.

Hyper-V, which is already available in beta form, is a component of the Windows 2008 Server operating system that lets IT managers run different virtual machines on one physical machine. Microsoft plans to include the technology as part of Windows Update (8 July) and it will be free to users who already have Server 2008, said Mike Schutz, Microsoft's director of product management for Windows Server.

Hyper-V is a "very important lynchpin" to Microsoft's virtualisation strategy, Schutz added, and one analyst specialising in operating systems says Microsoft is banking on customers choosing Hyper-V simply because it's made by Microsoft.

Dan Kusnetzky, principal of Kusnetzky Group, said Microsoft is competing directly with virtualisation vendors such as VMware, Citrix Systems and Virtual Iron Software.

"Microsoft appears to be executing the same strategy with virtual machine software that it has used with other technology in attempts to make its own product pervasive," Kusnetzky wrote in an email to Techworld's sister publication, ComputerWorld Canada. "Microsoft knows that its customer base is likely to simply move to the Microsoft version of that technology, regardless of the merits of the Microsoft software and those of the competitive offerings, because it is viewed as being 'free.'"

Schutz said with Hyper V, server virtualisation is now available to companies that did not previously have access to the technology.

"One benefit of our virtual approach to Windows is its going to be easy for customers to deploy," he said.

Server virtualisation lets companies distribute workloads from different servers into virtual machines, and this allows fewer servers to take on more work in data centres where most of the server capacity is not being used. Gartner attributed the technology to a four percent drop in the x86 market in 2006.

With Hyper-V, Microsoft says companies with servers running Windows and other operating systems, including Linux, will be able to consolidate servers. The company says users can also combine 32-bit and 64-bit workloads in the same environment.

Hyper-V also includes live backup and snapshot capabilities, which supports disaster recovery. Other features include virtual machine reconfiguration and symmetric multiprocessor support. Microsoft claims Hyper V's virtual switch capability lets users configure virtual machines with Windows Network Load Balancing.

Schutz said virtualisation is a "core component" of Microsoft's Dynamic IT initiative, which company executives discussed at the Tech Ed Conference in Orlando earlier this month.

Meanwhile, the appearance of Hyper-V has been welcome by at least one virtualisation vendor.

"Congratulations to Microsoft on getting Hyper-V out - this is great news for the virtualisation space as a whole since Microsoft’s entry into a market always draws considerable attention and the availability of Hyper-V will lower the barriers to adoption of server virtualisation," said Corey Thomas, VP of consumer and business at Parallels.

"That said, while we're excited, the news is likely to be seen far less positively by vendors who rely on highly priced hypervisors for their revenue," he added. "Hyper-V is going to seriously undercut those products, potentially representing a very serious threat for those companies."

"By offering a bundled solution, Microsoft is reaching a wider audience of potential virtualisation users, but the breadth of deployments will still be fairly narrow: Windows environments that are currently reaching their upgrade cycle," he said.

Thomas however does not feel threatened by Redmond's entry to the visualisation market. "From a virtualisation perspective, Hyper-V isn’t really a threat to us as we deliver an OS-level server virtualisation solution, Parallels Virtuozzo Containers, which solves a different set of problems than Hyper-V," he said.