"Think about the possibilities this can create. Software will not be tied to an operating system, rather it will be a malleable environment capable of running where the user wants it to."

Even within the VM realm, the operating system is still required to run the software. If you wanted to run Linux software on a Windows machine, you would create a virtual machine (VM) with partitioned hard-drive space, load Ubuntu, and then load the software within the VM. The opposite would hold true for Windows within a VM on a Linux box. You would have to have a copy of Win XP, load it onto the VM, load the software, and then you could run the software within the virtual environment...but your not eliminating the operating system or the licensing of the operating system from the equation.

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The virtualization trend is having a much greater impact on the hardware vendors than it will ever have on Microsoft. Contrary to what the article asserts, VMWare loosens the reins that tie applications to particular HARDWARE, not software. Apps that will only run in Windows will STILL only run in Windows. The only thing that's changed now is that virtualization makes it unnecessary for the average user to have to maintain a separate machine for each OS they wish to run. M$ was quick to 'enhance' their activation process so as to circumvent those who were hoping that virtualization was a 'cloner's wet dream'. One cannot just 'image' a Windows installation, then take the virtual image and propagate it to as many machines as they wish. Even when running as a virtual image, XP 'dials in', to the activation process and prompts the user to activate, or notifies them that their current 'imaged' activation is invalid.

No, virtualization's true impact is felt by the server manuf. Rather than now needing a bank of servers, the savvy IT admin can just order up one 'robust' server and run multiple (server)instances on that single power machine.