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Software beats hardware
Peter, Rebecca, thanks for taking a look at Zeus. You are correct in your prediction that routing and application front ends will become normal parts of the virtual infrastructure instead of the physical infrastructure.
Zeus customers (I'm the VP Marketing...) repeatedly tell us that in addition to the greener, easier to deploy advantages of virtual appliances, they like virtual appliances because they can add CPU or memory to them on the fly without re-purchasing the software.
Old-fashioned legacy hardware appliances are simply expensive software on cheap hardware. When you buy them, you get cool blue blinking lights or pretty glowing red logos, or maybe a bezel shaped like a racecar, but every time you need to grow your capacity, you have to pay for the same expensive software AGAIN, along with some slightly faster hardware. It's a treadmill that's good for the appliance vendors and bad for customers.
Virtual appliances let you move the expensive stuff - the software - from small servers to large ones without having to pay for it over and over.