When is virtual machine technology the wrong choice?

I was enjoying a conversation with the good folks at Appistry about where and how their application virtualization technology could best be used. I heard similar stories when speaking with the folks at Trigence. I was impressed by some of ways their customers are making use of that technology.

During the conversation it again become clear at each of the various types of virtualization technology referenced in the Kusnetzky Group model of virtualization (see Sorting out the different layers of virtualization) has its unique place in the pantheon of information technology. Although virtual machine technology is just the ticket when system (client or server) optimization and consolidation are the goals, it simply isn't the correct choice when other requirements are at the forefront.

When is virtual machine software the wrong choice?

• When the goal is allowing people to access applications and data from wherever they are, using whatever network-enabled device is handy and using a local network of some kind. This is when access virtualization is the best choice. By the way, the application and data being accessed could be hosted in a virtual machine on a local client, blade PC, blade computer or general purpose computer.
• When the goal is highly efficient application isolation, application performance application reliability/availability or making an application work in an environment that normally would create problems. In this case application virtualization technology is a better choice.
• When the goal is workload isolation and optimization, but all of the applications are designed for the same operating system. In this case, operating system virtualization/partioning is a better choice.

I could also bring up high availability/reliability, creating a unified management domain and a few other use cases.

Why is it, then, that organizations often fixate on virtual machine technology and try to apply it everywhere? I guess Abraham Maslow was right when he said "If the only tool you have is a hammer, you tend to see every problem as a nail."