IDC published in December 2006 its prediction for current year, summoning rise of Virtualization 2.0 and seeing virtual appliances widespread:

1. The next wave in virtualization emerges, which IDC calls Virtualization 2.0. Users will focus on continuity, disaster recovery, and high availability
2. Software appliances will become a household word in 2007. The convergence of virtual machine technology and a new initiative by several tool vendors is giving birth to this new form of software packaging
3. The use of Linux paravirtualization will be mostly sizzle - not steak. Few users are going to substitute their current kernel with a paravirtualized kernel
4. Management of virtual infrastructure takes center stage at large enterprises, extending adoption of virtualization across test, development, and production
5. Virtualization and security will become stronger focal points for ITIL/ITSM vendors, who will do more to add support for virtualization and managing virtual environments to their service management offerings

I think Virtualization 1.0 is not even near, with so much limits in hardware and software support, disaster recovery (something which should be included in any 1.0 product version) and enterprise management. I also have very different point of view about virtual appliances, which introduces much more risks than benefits.