It's the Holy Grail of Mac virtualization: a Mac inside another computer, running happily on a virtual machine and subject to your every whim. Up until last fall, there was no framework in Apple's licensing to allow for Mac OS X virtualization; then the ground shifted and the heavens shook, and there was a way forward. Mac OS X Server is now eligible for virtualization on Apple hardware, so naturally both big Mac virtual machine players are eagerly pushing forward on this front.

Parallels is offering OS X Server virtualization as part of its Parallels Server high-end product, which is currently approaching the end of its beta; the gang at VMware, however, are going the route of integrating OS X Server virtualization into the consumer level Fusion product. VMware has announced that the next beta of Fusion 2 (and the eventual release) will include the option to virtualize Mac OS X Server. This is awesome news for anyone using Fusion now, as the upgrade to 2.0 is free for existing customers.

Of course, virtualizing Mac OS X Server is not an inexpensive proposition, as even a 10-user license of Server clocks in at a cool $499. For developers and corporate folk, however (many who would have access to volume or seeding licenses of Server), it's a great help. Video demo of VMware's new feature announcement after the jump.

Thanks Peter.