Compartmentalization: you don't to pollute your normal working environment, and it's way easier to shut down/pause a VM if it starts to drag down your host system's peformance
Ability to take snapshots and roll back a VM, which can be handy when testing patches or new configurations
Ability to tweak resource allocation (memory, number of CPUs, etc) after the virtual server is created
Allows creation of dynamically expanding disk images, so storage isn't allocated until it's needed. When you're looking at 250-300GB of storage for an EBS Vision install, that can be a big deal.
Portability: If your VM is stored on an external drive, you can carry it with you for demos and whatnot. If you get pressed for space, you can burn the VM files to DVD and restore them later if needed.
Server virtualization and Storage
Server virtualization removes the virtual host dependencies from the
physical hardware, making the server CPU and RAM resources elastic and
variable. When a virtual host requires more server resources, they can be
moved to another physical server.
techniques solve or alleviate server resource contention, but they do not
resolve storage capacity or performance contention problems within the
Server virtualization remains server-centric, and does not solve storage management issues, which remain outside the
server virtualization management domain.
Documentation / Reference