Ouch. First of all, in most cases, this is hogwash. Second, they most likely haven't thought too far into the future if they are telling a paying customer that they won't support their own software. Third, ask if they would prefer that you go to their competitor for the software.
There are a few instances where I can empathize with a software vendor who says they won't support their product in a virtualized environment; for example, if they have a cryptic piece of code that manages some specialized piece of hardware, or if their software must control certain hardware directly without the proxy of a virtual server. Still, the question remains: Have they tried to be forward thinking, and to work with virtualization-software vendors to find a way to develop compatibility with the virtual-server environment?
At the root of many vendors' reactionary statements are licensing issues. Is the software licensed per user, per CPU, per seat, per server, per CPU speed? Think of the tailspin into which virtualization is forcing software vendors: If they licensed their software for a single physical server, and now that server has been transformed into a virtual server with dozens of instances of the software running on it, did the software vendor just lose revenue…?
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