MS Virtual PC (and Virtual Server) Now Free
First, for more on the release of VPC as free, see:
http://blogs.msdn.com/virtual_pc_guy/archive/2006/07/12/662535.aspx
About Virtualization
With virtualization you can run one "guest" OS (or Virtual Machine/VM) inside another "host" (your regular machine). That could be Linux inside Windows, or vice-versa. Or you could run Windows 2000 inside XP, etc.
Or you may choose simply to run multiple instances of a given OS on one box, perhaps using one guest to isolate changes to protect your main host. It's such a powerful solution for testing, development, and more.
Licensing the OS within the VM
To be clear: you still need to have licenses for whatever OS's you want to run in the VM/guest. VPC and other tools don't "come with a license" for any OS. You need to install one in your guest and you must own it.
I will note, however, that MS has revamped its licensing to recognize the use of OS's you DO own on virtual machines. I'll leave you to sort through the details to determine how it fits your situation:
http://www.microsoft.com/licensing/highlights/virtualization.mspx
Learning More about VM Products
Finally, to get VPC, visit:
http://www.microsoft.com/virtualpc
And for the server edition, see:
http://www.microsoft.com/virtualserver
FWIW, its major competitor (on Windows systems), VMWare, had also long ago released their server edition for free:
http://www.vmware.com/products/server/
The also released a free "virtual player". For more, see:
http://www.vmware.com/products/free_virtualization.html
For mac users, you probably already know that Parallels Desktop, while not free, is only $50.
Let the virtual reality begin. :-)
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