The Virtualization Practice

Application Virtualization

Application Virtualization covers application layering and application delivery approaches like streaming applications, and local application virtualization. Infrastructure as a Service focuses upon isolating the operating system from its underlying hardware and allowing multiple instances of operating systems to share that underlying hardware. Application Virtualization focuses upon isolating application from their underlying operating systems. ...
This make it unnecessary to install applications into operating systems, makes it easier to update new versions of applications, and breaks the dependencies between versions of applications and the specific versions of operating systems. Popular application virtualization offerings include Microsoft App-V, VMware ThinApp, and the XenApp Plugin for Hosted and Streaming applications.

VMware is trying to package Microsoft Windows out of existence by allowing applications to run in guest with no OS from Microsoft or Red Hat. Microsoft is trying to package VMware out of existence by including Hyper-V for free in Windows Server, and by providing application virtualization functionality that makes virtualizing server operating systems unnecessary.