Since everyone seems to be talking about VMWare, I thought i'd talk a little about XenServer
Most of our machines run XenServer, and it's pretty damn good! You can get a free license for it, and the XenCenter management console for it works a treat. The only problem with it seems to be that OpenBSD doesn't seem to like it.
It has a load of good features such as 'Snapshotting' servers while they are running, and you can run backup scripts which take backups of servers while they are running, which makes backups up a treat
It fully supports vlan's, dynamic storage, creating server "pools", VNC access to the virtual servers console, Performance Logs, Creating Templates and you can manage all your servers from the one management console!
Here's a screen-shot of the management console:
http://community.citrix.com/download.../xenserver.JPG
XenServer Downloads/Etc:
http://www.citrix.com/English/ps2/pr...ntentID=683148
If you haven't tried it our, I would definitely give it a go
Let me know how you get on!