Virtualization allows multiple virtual machines to run on a single physical server by sharing resources. The Xen Cloud Platform is an open source virtualization and cloud computing platform based on the Xen hypervisor. It provides virtual machine support, management tools, networking, and storage support in a single installable image. Xen has advantages over other hypervisors like VMware including its thin hypervisor model, security through isolation of guest machines, and widespread use in cloud computing environments. Virtualization reduces hardware costs by consolidating servers and allows faster reconfiguration of resources between virtual machines. Migrating virtual machines between physical hosts with pooled storage allows load balancing and host maintenance. Remaining challenges include network throughput bottlenecks and disaster planning.