Virtualisation has may benefits
For those that do not understand what virtualisation brings.
When you install several servers on the same physical machine, using the same physical services, you have the possibility of customers accidentally accessing other customer's data. No matter how secure you set up your server, there is always the possibility that the customers make a mistake and create the possibiility of others seeing their data.
By creating virtual instances of servers, you create one server per customer, yes it does consume some extra resources, such as memory, and also requires similar management to a full server, however, there is an absolute seperation of the servers, which means that even if the customer messes up internal security features, such as file permissions, then there is no chance that another customer can gain access to those data.
Now the virtual bit, just means that you can host multiple servers on the same physical hardware, with the same security that seperate physical machines would achieve.
Another benefit by virtualisation is that because each virtual server, in principle, is just a file on the server, moving the instance to another bit of hardware, just means moving that file to another physical piece of hardware, and boot the virtual instance, and wupti you're online after a server hardware crash.
Also if you have a physical server with a lot of virtual servers on it, and your cpu usage is reaching critical levels, you can always move one or more of the vritual servers to other physical servers, and thus distribute the system load very simply, without having to reinstall, or move applications, between servers.
Systems that lend them selves to efficient virtualisation are those that do not carry tonnes of redundant active services with them, eg a linux server stripped down to a web server, would consume less than 128MB of memory, depending on the complexity of the web services provided.
Other systems that have a lot of things that cannot be removed from them, tend to waste more resources, and therefore are less efficient when virtualising them. I would class Windows as such a system, because I've yet to find a way to strip windows down, so that it does not consume around 512Mb - 1 GB to run properly. However, your milage may vary. Considering how many virtual linux servers there are, compared to windows, may indicate that I'm not completely wrong.