Microsoft has further upped the ante in its competition with VMware\u2014the dominant virtualization vendor for x86 servers\u2014by making its Virtual PC product into a free download, and introducing more permissive license conditions for Windows Vista.Virtualization, the ability to run multiple server instances at the same time on a single hardware system, is taking off, with a recent Forrester survey showing that 60 percent of large North American businesses plan to spend money on the technology over the next year.The technology has been popularized for x86 servers since 1998 by VMware, which also offers the most mature virtualization management tools, according to industry analysts.Microsoft is intent on changing the game, however. Its Virtual Server and Virtual PC, based on technology acquired with Microsoft\u2019s purchase of Connectix, don\u2019t have the track record or mature tools of VMware and its partners, according to analysts.But Microsoft believes it can pull off a similar trick with Virtual Server and Virtual PC as it accomplished with Internet Explorer by making them easily available, and ultimately integrating them into the OS."We don\u2019t try and be the solution for absolutely everyone," said Alfred Biehler, Microsoft UK\u2019s product manager for management and virtualization technologies. "But for the majority of the market, we believe we\u2019ve got a good solution, especially for the cost-sensitive market."In April, Microsoft made Virtual Server 2005 R2, the latest version, free to download; as of Wednesday, Virtual PC is also freely downloadable. Microsoft has said it will integrate the technology into Longhorn Server, due next year, within about three months of the product\u2019s launch.Also on Wednesday, Microsoft unveiled some virtualization-related bonuses for customers who sign up for the company\u2019s unpopular Software Assurance volume licensing program.Software Assurance customers pay Microsoft a subscription fee to receive any software upgrades released during a set period, but aren\u2019t guaranteed that any upgrades will be released\u2014and delays have often meant that the upgrades haven\u2019t been released when customers expect.Microsoft has been adding more features to the program to convince customers to sign up; it has also announced that the Enterprise version of Windows Vista will be available only under Software Assurance. In February, Microsoft listed the inclusion of Virtual PC as one of the benefits of buying Vista Enterprise, though Wednesday\u2019s news effectively removes that benefit.Vista Enterprise users will, however, be allowed to install up to four copies of the OS in virtual machines for a single user on a single device, Microsoft said on Wednesday. The license permits competitors\u2019 technologies to be used to create the virtual machines. Previously, users would have needed to buy a license for each copy of Vista running in a virtual machine.Also on Wednesday, Microsoft announced it\u2019s working on Virtual PC 2007, the successor to VPC 2004. The product will support Vista both as host and guest OS, will support 64-bit Windows hosts (but not guests), and will boost performance over VPC 2004.-Matthew Broersma, Techworld.com (London)This article is posted on our Microsoft Informer page.\u00a0For more news on the Redmond, Wash.-based powerhouse, keep checking in.Check out our CIO News Alerts and Tech Informer pages for more updated news coverage.