A hypervisor is software that manages one or more virtual machines.
A virtual machine (VM) is a network-based physical computer system that can be located on or off-premises. Sometimes called a virtual machine monitor (VMM), the hypervisor manages those VMs and the compute resources associated with them. Those resources are attached device drivers, machine memory manager, process scheduler, data input/output (I/O) stack, machine security and network protocol stack. The hypervisor easily reallocates shared resources like memory and storage between connected VMs. While the hypervisor manages the resources and scheduling of VMs against the physical resources, the physical hardware still does the execution.
The hypervisor allows multiple operating systems to run alongside each other and share the same hardware resources. This is a key benefit of virtualization – without it, you can only run one operating system on the hardware.
Traditional hypervisor licensing fees are typically charged annually and are an unnecessary major budgetary cost to IT operations.