According to virtualization solutions provider VMware, the software update issued on Sunday created a time-bomb that went off at midnight, causing the product license to expire, leaving many servers unable to function normally, while others were unable to turn on. Before VMware released an updated patch, many users took to VMware's community forum to share information and try to diagnose the problem.

"We've just encountered a serious bug with our ESX cluster - serious enough that I thought I should post about it here as a prior warning for others running ESX 3.5 Update 2," said Matt Kilham's post, one of the first to identify the problem.

"The VMware tech support person we spoke to wouldn't 100 percent confirm whether this was/would be affecting all ESX3.5u2 installs, but he strongly alluded that it was widespread. For others' sake, I hope I'm wrong and it's limited," Kilham wrote.

VMware explained that the bug was due to old code from a prior release and that the quality assurance processes neglected to find the stale instructions.

"We are doing everything in our power to make sure this doesn't happen again," VMware CEO Paul Maritz wrote in his apology. "VMware prides itself on the quality and reliability of our products, and this incident has prompted a thorough self-examination of how we create and deliver products to our customers. We have kicked off a comprehensive, in-depth review of our QA and release processes, and will quickly make the needed changes."

In July, VMware launched the Release Candidate 1 version of VMware Server 2.0 (vmware.com/beta/server/), its second-generation virtualization server, to compete with industry heavyweights such as Microsoft that released its Hyper-V virtualization software in June.