Nicholas Biggestaff, a Unix systems administrator at the University of Missouri, said he likes VMware too. But he added that he would consider XenSource, whose annual support costs are about one-third as much as VMware's. "It's cheap enough that it's worth looking at," he said.

Enterprise VMware users such as Dennis Robinson, a technical infrastructure manager at Genex Services Inc., a medical management firm in Wayne, Pa., said VMware is well ahead of its competitors. "Microsoft is going to want to compete and so is Xen. Right now, it doesn't look like they can," said Robinson.

His company is piloting VMware in anticipation of a server consolidation project next year, but he said he plans to "do a little bit of a bake-off" between VMware and Microsoft before a final decision is made.

Raghu Raghuram, vice president of platform products at VMware, said rivals are helping to expand interest in virtualization -- and in his company. Toward that end, the Palo Alto, Calif.-based vendor wants its annual conference to be seen as an industry event.

"All said and done, this is still a young industry," said Raghuram. "We see this as a place were customers need to get educated about virtualization."