Just a day before market leader VMware kicks off its annual conference, XenSource on Monday unveiled release plans and sub-$1,000 pricing for its much-anticipated virtualization platform for Windows and Linux.

XenEnterprise, slated to be generally available in December for Windows Server 2003, Windows XP and Linux, will be priced at $488 for an annual subscription per each dual-socket server and $750 for a perpetual license, XenSource announced.

XenEnterprise for select Linux guests was announced in August, but the much-needed support for Windows in the upcoming version represents the product's true market debut, said executives for XenSource, the commercial spinoff of the Xen open-source project.

The timing of XenSource's latest and most important product announcement foreshadows the intense competition expected between the Palo Alto, Calif.-based company and VMware in the coming months.

Although VMware goes up against products such as Microsoft Virtual Server and SWSoft Virtuozzo in the marketplace, the new platform from XenSource is widely expected to offer the most serious competition to date. An EMC subsidiary, VMware has dominated the x86 virtualization market for more than five years and is expected to generate more than $750 million from its Intel and AMD virtualization business in 2006.

But XenSource executives said the attractive cost and quality of XenEnterprise makes the company a more viable rival to VMware because it offers near bare-metal Windows and Linux performance as well as ease of installation and P-To-V migration tools.

"It's less than $1,000, less than half of VMware's lowest-end offering and dramatically less [than the standard offering], and we're bundling in the management console and P-to-V tools," said Simon Crosby, CTO of XenSource.

"Our intention is to get mass deployment at a compelling price performance advantage on Windows," Crosby said. "We have 30 or 40 paying customers for our Linux product, but that's really more of a test market. The real market for us is volume virtualization for Windows, so we're positioned confidently against VMware's ESX."

XenSource has signed up 14 distributors across the globe, including Tech Data and Computerlink in Europe.

Also on Monday, XenSource announced the launch of XenSource University, a free two-day training program for approved business partners and technical partners.

To date, 150 VARs and other partners have signed up, Crosby said. The first training is scheduled to be held Nov. 30 to Dec. 1 in San Jose, Calif. The second training event will follow in Europe on Dec 7 in Amsterdam, the Netherlands. Free certification will be offered at the training events.

XenSource also plans to host XenSource University in Boston or New York in the first quarter, but a date hasn't yet been set.

Last week, XenSource launched a partner program for independent software and hardware vendors that plan to offer solutions atop XenEnterprise. So far, 35 companies have signed up, Crosby said.