The simplest way to explain virtualization may be: the ability to run multiple operating systems on a single piece of hardware. Of course, this is my personal definition and is specific to the context of how SMB’s typically use virtualization. For a more formal definition, Wikipedia has a pretty good one. Anyhow, in practice, this means that if your business employs 3 physical servers running Windows Server operating systems you could purchase one server and run all three instances of your Windows Server operating systems on that single piece of hardware.
At first glance it may not seem that revolutionary, but virtualization is changing the way technology is used across all market segments. Really.