Sun Microsystems is preparing to launch a Xen-based hypervisor in an attempt to catch up in the virtualisation market.

The server maker plans to release a first preview of its xVM server in January, followed by a release in the second quarter of 2008. An xVM Ops Center management application will be released in December.

Virtualisation is primarily used to consolidate infrastructure applications such as email, print and file servers on a single physical server.

The technology's greatest promise, however, lies in the ability to move workloads to a different server in the event of a hardware failure or to allow for maintenance without system downtime.

But the automation of such live migrations requires management software that is able to detect when a server is about to suffer a hardware failure, according to Marc Hamilton, vice president of Solaris marketing at Sun.

"The business agility benefits are more a feature of the management platform than of the actual virtualisation platform," he said in a meeting with reporters and analysts in San Francisco.

"As a systems company, we believe the real benefits are in tying together the management of the virtual and the physical layers."

The xVM server is essentially a tweaked version of Solaris in combination with the open source Xen hypervisor. It supports Linux, Windows and Solaris running as guest operating systems.

Hamilton declined to discuss the licensing structure for the software. Xen is governed by the General Public Licence, whereas Solaris falls under the Common Distribution and Development Licence.

Pointing to Sun's strategy of releasing all its software under an open source licence, Hamilton suggested that the xVM Server could fall under either licence.