This article on CIO Insight’s web site recounts how a small web hosting firm used virtualization technology to compete against its far larger rivals. How?

Flexibility. Virtualization allowed the company to dynamically allocating resources, devoting its (virtual) servers to H&R Block during tax season, then moving them to other clients when it was over. Virtualization also allowed them to offer utility computing solutions.

Reducing Power Consumption and Cooling Costs. The lesson everyone quickly learned as data was moved to the Cloud (a geeky way of hosting information on servers rather than desktops) was that electricity is expensive, for both the processors and the equipment to keep them cool. While chip manufacturers now see the light with lower consumption chips, there were still underutilized servers eating watts and requiring AC. Consolidating servers saved the company 50-70 percent in cooling and power costs.