VMware, a small Silicon Valley software-producing company, is attempting to tackle the industry's leader in software manufacturing, namely: Microsoft. VMware is a relatively young company and has been experimenting with cutting edge technology called "virtual-machine software".

A virtual machine essentially mimics a computer so that several copies of an operating system can run on one physical machine. Tasks can be completed using less electricity and less space compared to a standard PC. (Source: nytimes.com)

It is also a product that occupies strategic ground in computing, as a layer of code that resides between a computer's hardware and the operating system, usurping some tasks, and potentially undermining the importance of the operating system. (Source: news.com.com)

The product has already been acknowledged by a number of top executives at Microsoft, whose Windows operating systems account for the main source of their corporate wealth and market power. Microsoft assured the technological industry that they would be competing very aggressively with VMware.

Integrating new technology into their classic Windows operating systems has long been a desire for Microsoft. The general feeling among industry analysts is that the company sees the potential in virtualization and should begin manufacturing their own brand of software that will rival VMware. (Source: nytimes.com)

This is not the first time Microsoft has experienced competition in this field. Over a decade ago, Netscape challenged Windows by adding a crucial layer of software to their operating systems: the Internet browser.

Microsoft had initially feared that a rival's web browser running on top of the operating system could greatly reduce the power of Windows. This time, Microsoft is taking a slightly more restrained approach when dealing with their new competition.

It is anticipated that the retaliatory software released by Microsoft will likely include a program that allows virtual machines to move freely across many physical machines, though it is merely speculation at this point. (Source: news.com.com)