This document discusses the drivers for data center virtualization. It notes that legacy systems are difficult to manage, have poor reliability and high management costs. Server utilization rates are often only 5-10% leading to high power and cooling costs. Virtualization can help improve utilization rates and reduce costs by consolidating multiple physical servers onto fewer physical servers. The document outlines how virtualization can be implemented at different levels including the processor, operating system, network and storage. It also discusses how a next generation virtualized data center may integrate automation, standardization, and cloud compatibility.