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From the VMWare Converter 3 beta refresh release notes (found at virtualization.info):

VMware Converter provides an easy-to-use, scalable solution for migrations of machines, both physical to virtual and virtual to virtual. Optimized for mass migration, VMware Converter is equally effective for single-machine conversions. With its comprehensive and comprehensible wizards and task manager, VMware Converter imports virtual machines faster, with fewer manual steps required, and fewer source hardware limitations than other methods. Converter can, with its ability to hot clone, import with no downtime on the source physical machine.

VMware Converter combines and expands the functionality available in P2V Assistant and Virtual Machine Importer. It eases interoperability among VMware hosted products (Workstation, VMware Server, and VMware Player), VirtualCenter-managed ESX Server 3.x and 2.5.x, and unmanaged ESX Server 3.x.

Import from Physical Machines (Source)
VMware Converter can hot clone and reconfigure any local or remote physical machine running an operating system noted in Platforms VMware Converter Boot CD can be started from, and clone, local machines outfitted with storage controllers and network adapters that Microsoft lists as supported in Windows 2003

Import from Various Third-Party Formats and VMware Products (Source)

Microsoft Virtual PC (version 7 and higher) Microsoft Virtual Server (any version) Symantec Backup Exec System Recovery images1 VMware Workstation 4.x virtual machine (compatible with VMware GSX Server 3.x) VMware Workstation 5.x virtual machine (compatible with VMware Player and VMware Server 1.x) VMware ESX Server 3.x VMware ESX Server 3.x (when managed by VirtualCenter 2.x) VMware ESX Server 2.5.x (when managed by VirtualCenter 2.x)

Export to a Virtual Machine for VMware Workstation and Datacenter Products (Destination)

VMware Workstation 4.x virtual machine (compatible with VMware GSX Server 3.x, ESX Server 2.5.x)2 VMware Workstation 5.x virtual machine (compatible with VMware Player and VMware Server 1.x)3 VMware ESX Server 2.5.x (when managed by VirtualCenter 2.x) VMware ESX Server 3.x (when managed by VirtualCenter 2.x) VMware ESX Server 3.x Not Supported: VMware ESX Server 2.5.x when managed by VirtualCenter 1.x VMware ESX Server 2.5.x unmanaged

1. The Symantec family of products includes the Backup Exec System Recovery (formerly LiveState Recovery) products and the Norton Ghost 9 (and higher) products. Only images from the Backup Exec System Recovery products are fully supported, but images from Norton Ghost 9 (and higher) are likely to work.

2. For ESX Server 2.5.x the .vmdk files must be imported using the vmkfstools utility.

3. Only Workstation 5.5 can power on linked imports of .sv2i images.

For more info please visit VMWare’s Converter 3 Beta Refresh page.

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