Appliances have a solid place in the IT world as vendors take a stand-alone system and install their software on top for a very specific purpose. Storage appliances, network appliances, antispam/antivirus appliances, load balancers, and so forth all have a special place in organizations that see the value in having devices with lower setup complexity and allow for simplified support. The downside: They take up space in your environment (aka appliance sprawl), not to mention the added hardware cost they can incur.
One way to lessen the downside of a hardware appliance is to go with a virtual appliance. Virtual appliances are simply VM images that can usually be run under most major virtualization environments -- bye-bye, hardware sprawl. It's quite logical, really. If virtualization helps reduce server issues and hardware costs, it stands to reason that appliances can slip into the VM world just as easily. And they are.
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One virtual appliance that I've worked with for Exchange load balancing comes from Kemp Technologies, which has both hardware load-balancing appliances and virtual appliances such as LoadMaster VLM Exchange. How a virtual appliance differs from its hardware sibling often depends on the resources allocated to the virtual machine, as you can see in this comparison chart for Kemp products.
Data centers often have racks of appliances bustling with resources that aren't needed by what their software does for you. By contrast, a virtual appliance lets you match the resources to what you actually need. In some cases, you may require more or less in terms of hardware performance, network ports, requests per second, and so forth; in a virtual appliance, you can allocate the resources accordingly. Plus, one of the cool things about VMs is that you can move them to another system if the current one can't provide the resources the appliance software needs.