Microsoft began offering the product for download from its website on Thursday, despite the software giant previously stating that the product would not be available until August.

Hyper-V, like other server virtualization software, enables the virtualization of multiple operating systems all on the same server, providing a scalable solution that helps reduce costly equipment, electricity and maintenance fees.

VMware has been a leader in virtualization software in a market that also includes competitors Citrix Systems (citrix.com), Oracle (oracle.com), Virtual Iron (virtualiron.com) and Parallels (parallels.com).

Last December, Microsoft launched the hypervisor-based vitualization platform, which is a vital feature of Windows Server 2008, in a beta release. It updated the software in March with a feature-complete release that offers updated, near-final code.

Hyper-V is priced at $28 per server, compared to VMware's price tag of $7,000 to $14,000 price tag for a comparable VMware product, depending on the number of processors.

The significantly lower price may be enough to entice some businesses to make the switch to Hyper-V, say analysts. It is pertinent to note, however, that VMware's software has more advanced functionality in certain area.

Meanwhile, the release of Hyper-V may have affected stock prices, as VMware shares fell 4.25 percent to $59.58 on Thursday afternoon on the Nasdaq. Microsoft shares also saw a slight drop by 1.31 percent at $27.98.

Earlier this week, utility hosting services provider Layered Technologies announced on Wednesday that it has collaborated with Microsoft to become the first hosting provider to launch Hyper-V.