One of the pitfalls of adopting virtualization is software licensing which will continue to lag behind the technology right through to 2010.

Warning that software pricing hasn't kept pace with virtualization technology, Gartner vice president Phil Sargeant warned IT managers to get their licensing in order now to avoid being hit with a costly problem down the road.

Speaking at a series of CIO Magazine breakfast briefings held in Melbourne, Sydney and Brisbane last month, Sargeant told delegates to check vendor support policies, pricing and licensing when it comes to virtualization.

Sargeant outlined the virtualization landscape to 2010 listing both the benefits and pitfalls of the technology and a framework for the creation of a Real Time Infrastructure (RTI).

He said its important to have a management plan to avoid virtual sprawl and recommended use of a charge-back system.

Giving a market overview, Sargeant said virtual software packages and appliances will be mainstream by 2010 and virtualizing clients on servers will become common by 2009.

"By the end of 2008 virtualization technologies for x86 servers will be essentially free and will be in use in 90 per cent of Fortune 500 companies," he said.

Moreover, he said Microsoft will deliver a hypervisor solution that relies on Windows Longhorn server as a parent operating system in 2008.

"By 2009, more than four million virtual machines will be installed on x86 servers which is about 20 per cent of the total potential market," he said.

"And while blades will be ubiquitous in the next 12 months, the major components will not be standardized between major suppliers by 2008."

Sargeant's overview was followed by a presentation from Jim Balog, ANZ lead for enterprise solutions services at Unisys.

Balog leads the virtualization program at Unisys helping clients implement their virtualized environments. He talked about how virtualization enables innovation.

"Virtualization is a key step in the journey to a RTI, an infrastructure that provisions power on tap, provides control and governance to your IT department," he said.

"Enterprises that have started virtualization have taken a significant step down a path that enables them to embrace innovation and effect change."

Each briefing featured a panel discussion with an impressive lineup of CIOs who shared their own experiences deploying virtualization providing the quick wins and detailing some of the obstacles and challenges when it came to people and processes.

With a record number of attendees at the event, there was plenty of lively debate as the floor was open for questions from the audience.