Long Zheng writes about Native VHD support in Windows 7. To me, it meant a rapid step-up in their virtualization strategy. Today, if you want to try out a VHD you have to download Virtual PC or Virtual Server.
Microsoft has packaged up dozens of these VHD files ranging from Exchange to SQL to SharePoint to to ILM to Forefront to Windows Servers… and it looks like they want more people to be able to try and test these products without dedicating a complete physical machine to them (or have to add a piece of software to their existing setups). A logical move.
[updated January 27th 2009: Inside Windows 2008 R2 Virtualization Improvements and Native VHD Support (Mark Russinovich)