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Type 1 virtualization
A third type of virtualization technology available today is Type 1 VMM, or hypervizor technology. A hypervisor is layer of software that sits just above the hardware and beneath one or more operating systems. Its primary purpose is to provide isolated execution environments, called partitions, withing which virtual machines containing guest OSs can run. Each partition is provided with its own set of hardware resources – such as memory, CPU cycles, and devices – and the hypervisor is responsible for controlling and arbitrating access to the underlying hardware.
Hypervizor-based virtualization has the greatest performance potential, and it has two types of hypervizor: monolithic and microkernelized. In next posts I’m gonna describe both types, and tell you which one is used in Windows Server 2008.
Resources:
Hybrid virtualization
Type 2 virtualization
Does server virtualization reduce costs?
Why should you use OS virtualization?
Virtualization today
Virtualization on brajkovic.info
Introducing Windows Server 2008 by Mitch Tulluch
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Ilija
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Daniel Anderson
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Ilija
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WTF

