The Invention of the Virtual Machine

In the early 1960s, IBM faced a significant challenge with their wide range of systems. Each generation was substantially different from the previous, making it difficult for customers to keep up with changes and requirements. Additionally, computers could only execute one task at a time, requiring batch processing for multiple operations.

The S/360 Mainframe System

Because of these hardware compatibility issues, IBM began developing the S/360 mainframe system. This system was designed as a broad replacement for many of their existing systems while maintaining backward compatibility. Initially, the S/360 was conceived as a single-user system for running batch jobs.

Project MAC: The Catalyst for Change

On July 1, 1963, the Massachusetts Institute of Technology (MIT) announced Project MAC (Mathematics and Computation, later renamed Multiple Access Computer). This project was funded by a $2 million grant from DARPA to research operating systems, artificial intelligence, and computational theory.

When MIT sought proposals for new computer hardware capable of supporting multiple simultaneous users, IBM was initially unwilling to commit to time-sharing technology. They didn’t believe there was sufficient market demand. MIT chose General Electric instead, as GE was willing to commit to time-sharing capabilities.

The CP-40 and CP-67 Systems

The loss of the MIT contract served as a wake-up call for IBM, especially when they learned of Bell Labs’ similar requirements. In response, IBM designed the CP-40 mainframe, which was never sold commercially but served as a laboratory prototype. The CP-40 evolved into the CP-67 system—the first commercial mainframe to support virtualization.

The operating system for the CP-67 was called CP/CMS, where CP stood for Control Program and CMS for Console Monitor System. CMS was a small, single-user operating system designed for interactive use, while CP created the virtual machines. The architecture allowed CP to run on the mainframe and create virtual machines that ran CMS, providing each user with their own interactive environment.

Portability of Software and Early Application Virtualization

While the CP/CMS system demonstrated hardware virtualization, another form of virtualization was emerging through Unix development. Unix represented virtualization at the user and workspace level, allowing multiple users to share the same hardware resources while maintaining separate profiles and environments.

Unix and the C Programming Revolution

Unix marked a significant advancement in software portability. Unlike previous operating systems coded in assembly language, Unix was created using the C programming language. This approach meant that only small portions of the operating system needed customization for specific hardware platforms—the rest could be recompiled with minimal changes.

Unix also pioneered application virtualization concepts by providing users with greater application portability. Through Unix and C compilers, skilled users could run programs across different platforms, though this still required compilation on each target system.

Application Virtualization: The Java Revolution

True software portability required a breakthrough beyond Unix’s compilation-based approach. This breakthrough came from Sun Microsystems through a project that would revolutionize application virtualization.

From “Stealth” to Java

In 1990, Sun Microsystems engineers frustrated with C/C++ APIs began “Project Stealth.” This project went through several name changes—Oak, Web Runner—before finally becoming Java in 1995. By 1994, Sun recognized the World Wide Web as a major growth opportunity and targeted Java for internet applications.

The Internet consisted of computers running different operating systems with no universal way to run rich applications. Java solved this problem by introducing a revolutionary concept: “write once, run anywhere.” In January 1996, the Java Development Kit (JDK) was released, enabling developers to create applications for the Java platform.

How Java Virtual Machines Work

Java applications run inside the Java Virtual Machine (JVM), which functions as a specialized operating system dedicated to running Java applications. When you write Java code, it compiles into Java Byte Code—an intermediate language readable only by the Java Runtime Environment (JRE). The JRE handles platform-specific compilation through Just-in-Time compilation, eliminating the need for developers to worry about target platforms.

Mainstream Adoption of Hardware Virtualization

While IBM pioneered virtual machines on mainframes, the technology needed to evolve for smaller computing environments. The transition from mainframes to personal computers and workstations required new approaches to virtualization.

Early Desktop Virtualization: SoftPC

In January 1987, Insignia Solutions demonstrated SoftPC, a software emulator that allowed Unix workstation users to run DOS applications. This represented a significant breakthrough—previously impossible cross-platform compatibility. At the time, a PC capable of running MS-DOS cost around $1,500, while SoftPC provided the same capability to Unix users for just $500.

By 1989, Insignia Solutions had expanded to Mac compatibility and added Windows application support beyond just DOS. By 1994, they were selling complete packages including SoftWindows and SoftOS/2 with pre-loaded operating systems.

The Rise of VMware

Inspired by SoftPC’s success, other companies entered the virtualization market. In 1997, Apple created Virtual PC through Connectix, allowing Mac users to run Windows applications. VMware was established in 1998, releasing VMware Workstation in 1999—initially for Windows platforms but later expanding to other operating systems.

VMware became the market leader in virtualization through their enterprise focus. In 2001, they released two groundbreaking products: ESX Server and GSX Server. GSX Server operated as a Type-2 Hypervisor, running virtual machines on top of existing operating systems like Microsoft Windows. ESX Server functioned as a Type-1 Hypervisor, running virtual machines directly without requiring a host operating system.

Market Competition and Growth

Since ESX Server’s 2001 release, VMware experienced exponential growth in the enterprise market, developing complementary products to enhance their platform. Other major vendors soon entered the market. Microsoft acquired Connectix in 2003, releasing Virtual PC 2004 and Virtual Server 2005. Citrix entered virtualization in 2007 by acquiring XenSource, an open-source virtualization platform that began in 2003, later renaming it to XenServer.

Published Applications and Remote Access

Parallel to hardware virtualization development, another form of virtualization emerged through remote application access. Early Unix systems provided published applications via Telnet and later SSH, allowing users to access remote computers through text or graphical interfaces.

Citrix: Creating Multi-User Windows

Windows and OS/2 initially lacked remote access capabilities without third-party solutions, which typically supported only single users. IBM engineers envisioned creating a multi-user interface for OS/2, but IBM didn’t share this vision. In 1989, Ed Lacobucci left IBM to start Citrus (quickly rebranded as Citrix due to trademark issues).

Citrix licensed OS/2 source code through Microsoft and developed MULTIUSER, a multi-user interface for OS/2. However, they abandoned this project in 1991 when Microsoft discontinued OS/2 support. Citrix then licensed Windows NT source code and began developing a Windows-focused solution.

WinFrame and Terminal Services

In 1993, Citrix acquired Netware Access Server from Novell, a product similar to their OS/2 work that provided multiple users access to a single system. After licensing Windows NT source code from Microsoft, Citrix released WinFrame in 1995—a version of Windows NT 3.5 with remote access capabilities allowing multiple simultaneous users to run applications remotely.

When developing WinFrame for Windows NT 4.0, Microsoft decided not to grant necessary licenses to Citrix. Instead, Citrix licensed WinFrame technology to Microsoft, which became Terminal Services in Windows NT 4.0. This agreement prevented Citrix from creating competing products but allowed them to extend Terminal Services functionality.

Virtual Desktops: Modern VDI Solutions

Virtual Desktop Infrastructure (VDI) represents the modern evolution of IBM’s 1960s mainframe concept. VDI runs user desktop operating systems like Windows within virtual machines on centralized infrastructure, providing each user with their own operating system while enabling efficient resource utilization.

The Evolution to Modern VDI

Comparing MultiCS from the 1960s to IBM mainframes is similar to comparing Microsoft Terminal Server to modern Virtual Desktop Infrastructure. The fundamental concept remains the same: providing users with dedicated computing environments while centralizing resources and management.

The transition from mainframe virtual desktops to modern VDI didn’t occur until 2007 when VMware introduced their VDI product. While virtual desktops were technically possible before this release, management complexity made them impractical for most organizations. The introduction of Virtual Machine Manager from VMware, along with similar products from Microsoft and Citrix, enabled rapid growth in this sector.

Summary: Five Decades of Virtualization Innovation

Computer virtualization spans nearly half a century of technological evolution, transforming how organizations utilize computing resources. From IBM’s 1960s mainframes to modern cloud infrastructure, virtualization has consistently provided solutions for improving application accessibility, cross-platform compatibility, system stability, and resource efficiency.

Some technologies, like virtual desktops, trace their origins to the 1960s, while others, such as application virtualization through Java, emerged in the 1990s. Today’s virtualization landscape encompasses hardware virtualization, application virtualization, and virtual desktop infrastructure—all building upon foundational concepts developed decades ago.

Understanding this history provides valuable context for modern IT decisions and helps organizations appreciate how current virtualization technologies evolved to meet changing business requirements. As we move toward increasingly cloud-centric and distributed computing environments, these foundational virtualization concepts remain as relevant as ever.

Elevate Your IT Efficiency with Expert Solutions

Transform Your Technology, Propel Your Business

Unlock advanced virtualization and technology solutions tailored to your business needs. At InventiveHQ, we combine decades of industry expertise with innovative practices to enhance your cybersecurity, streamline your IT operations, and leverage cloud technologies for optimal efficiency and growth.