The mid-term R2 refresh of Hyper-V Server 2008 sees Microsoft's free bare-metal hypervisor enhanced to match the capabilities of its full Windows Server 2008 R2 implementation. In essence, that means greater scalability, plus the inclusion of VM migration tools left out of the original release — including live migration with minimal downtime. However, management tools remain an extra so, by itself, Hyper-V Server 2008 R2 shouldn't be considered a self-contained virtualisation solution.

In its target enterprise market, where it will be deployed together with the full Windows Server 2008 product, Hyper-V Server makes a lot of sense. That's partly because it's free, but equally because it speeds up and simplifies server deployment. In our tests it took no more than 30 minutes to configure a new server — even less once we'd downloaded the free boot image and burned it to DVD.

The main advantage is that there's no need to install Windows before starting. Instead, Server Core is loaded as part of an automated setup routine that requires very little operator attention. That done, you end up with the same text-based GUI as the previous release, but it's easy to connect a new server to the network and join it to a domain. You can then use the same Hyper-V and Failover Cluster manager tools included with Windows Server 2008 R2 to manage the server and do things like join it to a failover cluster, create, clone and migrate VMs and so on. Also, System Centre Virtual Machine Manager 2008 (SCVMM 2008) has also been updated to provide cross-server management tools for both R2 implementations, with identical functionality regardless of whether you're using the full hypervisor or the standalone version.

Unfortunately, lower down the food chain, smaller companies may find this approach a little expensive. In which case it's tempting to leave Windows Server 2008 out of the equation and consider installing Hyper-V as a standalone solution. However, that's not necessarily a good idea, for a number of reasons.

Failover clustering and live migration are new in the R2 version of Hyper-V Server 2008, but you'll still need to add management tools.

Licensing is a an often-overlooked consideration, as with Windows Server 2008 you get a licence to run Windows Server on both a physical and a virtual machine. However, Windows licences are not included with Hyper-V Server, so you'll have to buy into Windows Server anyway, unless you already have licences you can employ — or if you only want to host Linux VMs.

Then there's management. Free management tools for Hyper-V Server are available as part of a package called Remote Server Administration Tools (RSAT). Indeed they've been around for quite a number of years, but you'll need Windows 7 to host the latest release, capable of managing Hyper-V Server 2008 R2.

We expected to find an RSAT link on the Hyper-V Server website, but there wasn't one and we had to spend some time searching for the download (which can only be installed on PCs running the Enterprise, Professional or Ultimate editions of Windows 7).

The RSAT tools are no harder to install than any other application. However, we had problems connecting them to our test server — especially on a workgroup network, where we ended up switching to a domain network. This was perplexing as we'd expect a workgroup setup to be pretty common and we've had no such issues when deploying other hypervisors from Citrix, Parallels and VMware, all of which bundle management tools with their products — including the free ones.

Once up and running, the RSAT tools are pretty straightforward, with a very similar front end to those included in Windows Server. Moreover, what you end up with is a scalable virtualisation platform that now matches the full Windows Server 2008 R2 hypervisor. That means support for host servers with up to eight processors or 64 cores, plus 1TB of RAM. Up to 384 VMs can now be hosted by each server (double the limit in the original version), with up to 512 virtual processors in total and a maximum of 64GB of RAM and 2TB of disk space per VM.

You also get core parking and hot swapping of virtual SCSI disks, plus live migration and the failover clustering needed to support it. These features may not be that important for smaller companies but, regardless of who you are, Hyper-V Server 2008 R2 has a lot to offer. Just bear in mind that it may not be the free virtualisation ride it seems.