The introduction of Hyper-V to all editions of Windows Server 2008 (except Web Edition) has meant there's been a licensing change to the Standard Edition.
The previous editions of Windows Server Standard Edition allowed for 1 instance of Windows Server to be installed as a Physical Operating System Environment (POSE) or as a Virtual Operating System Environment (VOSE). This meant that if you wanted to host a virtualised Windows Server 2003 R2 Standard Edition on say Virtual Server 2005 R2 running on Windows Server 2003 R2 Standard Edition, then you needed to acquire 2 licenses of Windows Server 2003 R2 Standard Edition - one for the physical instance and one for the virtual instance.
The new licensing change brings the Standard Edition in line with the Enterprise Edition. This means that Windows Server 2008 Standard Edition can be installed twice using the one license - once for the physical instance and once for the virtualised instance. The caveat is that the physical instance can only be used for the purposes of hosting the virtualised instance. All the workload for the Standard Edition license is to be performed in the virtualised instance, with the physical instance used to host and maintain the virtualised instance.
More information can be found in the Licensing Information section of the Hyper-V FAQ, Microsoft's Licensing Virtualisation changes and the Volume Licensing Product Use Rights.
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