Understanding Virtualization Software: Types, Benefits and Best Features

Virtualization software is a game-changer for businesses looking to do more with less. By allowing multiple virtual machines to run on a single physical system, it helps organizations maximize hardware usage, reduce costs, and increase agility. From servers to applications, virtualization makes it easier to manage resources, scale operations, and respond quickly to changing business needs. In this guide, we’ll break down what virtualization software is, explore its advantages and show you how to choose the right solution for your organization.

What is virtualization software?

Virtualization software is a technology that allows you to create multiple simulated environments or dedicated resources from a single physical system. It works by using a layer of software — often called a hypervisor — to divide the physical hardware into separate virtual machines (VMs), each with its own operating system and applications. This enables one physical server or computer to run multiple independent workloads simultaneously, improving efficiency and reducing hardware costs.

How virtualization software works

A virtual machine works by emulating a physical computer within a host system, allowing multiple operating systems, containers and applications to run independently on a single piece of hardware. At the core of this process is the hypervisor, a software layer that sits between the physical hardware and the virtual environments. The hypervisor allocates computing resources such as CPU, memory and storage to each virtual machine, making sure they operate in isolation from one another while sharing the same physical infrastructure.

These virtual machines are typically managed across nodes, which are physical servers in a virtualization cluster. Each node can host multiple VMs, and workloads can be moved or balanced between nodes for optimal performance and availability. The combination of hypervisors and nodes creates a flexible, scalable environment that makes better use of hardware, simplifies deployment and improves resiliency — all key advantages for modern data centers and cloud-based architectures.

Types of virtualization software

Virtualization software comes in many forms, each designed to abstract and streamline different layers of IT infrastructure. The type of virtualization software an organization chooses depends on its unique operational needs, whether that’s consolidating hardware, improving remote access or optimizing storage and data use.

Server virtualization software

This type of virtualization creates multiple virtual servers on a single physical server. Using a hypervisor, each virtual server operates independently and can run its own operating system and applications. Server virtualization improves resource utilization, reduces hardware costs and makes server management more flexible and resilient.

Network virtualization

Network virtualization combines hardware and software network resources into a single, software-based administrative entity. It allows IT teams to segment and manage networks more easily, create isolated environments and quickly reconfigure network settings. This enhances performance, boosts security and simplifies complex network management.

Desktop virtualization

With desktop virtualization, users access their desktop environments remotely through a centralized server. Each virtual desktop behaves like a physical computer, but the actual computing takes place on a data center server. This is especially valuable for remote work, BYOD (bring your own device) policies and improving endpoint security.

Storage virtualization

By aggregating multiple physical storage devices into one virtual storage pool, storage virtualization makes it easier to manage, provision and scale storage resources without having to physically move data. It also improves redundancy, performance and capacity planning.

Application virtualization

Application virtualization allows software to run on a device without being installed directly on it. The application is abstracted from the operating system and delivered through a centralized platform. This approach simplifies software deployment, enhances compatibility and reduces conflicts between applications.

Data virtualization

One of the reasons data virtualization is unique is because it provides a real-time, unified view of data across multiple sources without physically moving or replicating it. It enables faster data access and analysis while reducing the need for traditional data integration methods. This is especially useful for business intelligence, analytics and agile data workflows.

Examples of virtualization software use cases

Many industries use virtualization software to optimize resources, reduce costs and increase flexibility. Here are a few real-world scenarios that showcase how virtualization tools are applied in practice.

IT infrastructure consolidation in financial services

A large bank with hundreds of servers spread across multiple locations faced rising operational costs and inefficient resource usage. By implementing server virtualization, the IT team consolidated workloads onto fewer physical machines, significantly reducing hardware maintenance and power consumption. This move also improved agility, allowing the bank to deploy new applications and services faster while ensuring data isolation for compliance.

Remote desktop access in education

A university needed a cost-effective solution to provide students and faculty with access to specialized software without installing it on every personal device. Through desktop virtualization, the institution created a virtual desktop infrastructure (VDI) that allowed users to securely access lab environments from anywhere. This enhanced flexibility, supported distance learning and reduced the IT team’s burden of managing physical machines across campus.

Accelerating development at BMW with SUSE Virtualization

BMW Group turned to SUSE’s open source virtualization solutions to streamline and scale its development and testing environments. By deploying SUSE Virtualization across thousands of hosts, BMW enabled its teams to spin up virtual machines on demand, speeding up software development and vehicle innovation. The solution reduced provisioning time, improved system performance and supported BMW’s broader digital transformation goals.

Advantages of using virtual machine software

Whether you’re running enterprise workloads or experimenting with new applications, virtualization software provides a reliable and powerful platform with advantages like:

Better resource utilization

Virtual machine software enables multiple operating systems and applications to run simultaneously on one physical machine, optimizing the use of CPU, memory and storage. This reduces idle time and ensures that hardware resources are used more efficiently across the organization.

Cost savings

With fewer physical machines required, businesses can significantly cut costs related to hardware purchases, power usage and data center space. It also lowers maintenance demands, freeing up IT teams to focus on more strategic initiatives.

Simplified testing and development

Virtual machines offer isolated environments that can be quickly created, modified or deleted, making them ideal for testing software updates or developing new applications. Teams can simulate different operating systems and configurations without the risk of disrupting production environments.

Improved disaster recovery

Virtualization makes it easy to create snapshots and backups of entire systems. If a failure occurs, organizations can rapidly restore services by deploying saved images, minimizing downtime and preserving business continuity.

Enhanced security and isolation

Each virtual machine runs independently, offering a strong layer of isolation from others on the same host. This containment helps prevent threats from spreading and allows security protocols to be applied to individual VMs without affecting others.

Scalability and flexibility

Scalability and flexibility are major advantages of virtualization software. Virtual machine software makes it easy to scale operations up or down based on business needs. New machines can be provisioned quickly, and workloads can be migrated or balanced across environments with minimal disruption.

Challenges to using virtualization software

As organizations increasingly adopt virtualization tools to modernize infrastructure and reduce costs, they also encounter issues related to complexity, performance, security and resource management. Understanding these challenges is key to building a successful virtualization strategy.

Performance overhead

Virtualization platforms share the resources of a single physical host, which can lead to competition for CPU, memory and storage. If not carefully managed, this resource contention can degrade performance and impact application responsiveness, especially during peak workloads.

Security vulnerabilities

While virtualization solutions offer isolation, they also introduce new security considerations. Misconfigurations, outdated hypervisors or vulnerabilities in the virtualization layer can expose the entire system to risks, especially in multi-tenant environments.

Licensing and compliance

Virtualization can complicate software licensing, especially when dealing with dynamic workloads or multiple vendors. Organizations may struggle to track usage accurately, leading to compliance risks or unexpected costs.

Initial setup and infrastructure costs

While virtualization saves money over time, the initial investment in hardware, software and training can be substantial. Smaller organizations may find it difficult to justify the upfront costs or lack the in-house expertise to implement it effectively.

Best virtualization platform features to look out for

When choosing a virtualization platform, it’s important to consider features that not only support your current infrastructure but also scale with your future needs. The right platform should enhance flexibility, performance and management while maintaining strong security and cost-efficiency. Here are key features to look for:

• Hypervisor performance and compatibility. Look for a platform with a reliable, high-performance hypervisor that supports your preferred hardware, operating systems and workloads.
• Centralized management tools. Choose a solution with an intuitive dashboard for managing virtual machines, monitoring performance, allocating resources and automating tasks.
• Security and isolation. Strong built-in security features such as VM isolation, encryption, access controls and patching tools help minimize risk.
• Disaster recovery and backup options. Native support for backups, snapshots, failover and replication ensures business continuity.
• Resource optimization and load balancing. Efficient use of CPU, memory and storage, along with dynamic resource allocation, ensures better performance, scalability and cost control.
• Vendor support and community. A strong user community and responsive technical support can make a major difference in troubleshooting, customization and long-term success.

Virtualization software: Final thoughts

Virtualization software has become a cornerstone of modern IT strategy, offering flexibility, efficiency and scalability for businesses of all sizes. By understanding the types of virtualization, the benefits and what features to look for in a platform, organizations can make informed decisions that support long-term growth and resilience. 

Whether you’re streamlining workloads, improving disaster recovery or enhancing security, the right virtualization solution can transform your infrastructure. SUSE offers powerful, enterprise-ready virtualization tools designed to meet today’s challenges and scale for tomorrow’s opportunities. Learn how SUSE Virtualization can help you modernize your IT stack.

Virtualization software FAQs

Is virtualization the same as cloud computing?

No, virtualization and cloud computing are related but not the same. Virtualization is the underlying technology that allows multiple virtual machines to run on a single physical machine, while cloud computing delivers services — often powered by virtualization — over the internet.

Does virtualization software improve security?

Virtualization software can improve security by isolating workloads in separate environments, limiting the impact of breaches. However, it also introduces new security concerns that require proper configuration and management to avoid vulnerabilities in the virtualization layer.

Can virtualization software help with disaster recovery?

Yes, virtualization simplifies disaster recovery by making it easier to replicate, back up and restore entire systems quickly. Virtual machines can be moved or restored to new hardware with minimal downtime, enhancing business continuity.