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Microsoft's Next Generation Secure Computing Base (NGSCB), conceived originally as hardware-based Digital Rights Management (DRM) for Longhorn, is morphing into server virtualization, Gartner Group says.

The analyst expects NGSCB to appear in a second release of the Longhorn client, which it thinks will ship between mid-to-end 2007 and the end of 2008.

Virtualization is a relatively new category of server technology that is growing in importance, as vendors are forced to re-think the way they charge for their software. Among prime concerns is whether to charge a one-time fee or multiple fees for customers who use their software in virtual environments

Microsoft's expected shipment date for the much-delayed Longhorn operating system means that it will be late to market with virtualization and - critically - allow Linux a foothold in controlling the underling hardware. Earlier this year, Linus Torvalds' right-hand-man, Andrew Morton, said he would include the Xen open source virtualization technology in the next Linux kernel.

Virtualization technologies, also called hyperviser, are in the pipeline from the hardware manufacturers to. AMD and Intel are courting software vendors with their Pacifica and Virtualization Technology offerings.

At Gartner's Symposium and IT/xpo 2005 in San Francisco yesterday, Tom Bittman, Gartner's research director, spoke on the state of the Microsoft nation. He noted that: "Microsoft is late with hyperviser... Microsoft will ship [the first version of Longhorn], but it won't hold up the release."

Microsoft would also be late in setting pricing of software running in virtual environments. But he added that Microsoft "will have to be a leader in pricing changes in the next few years".

Gartner says the first Longhorn client could slip into 2007, from 2006 as promised by Microsoft, while the first Longhorn server will appear between 12 and 18 months after the client. ®

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