Virtual Server on SBS2008

why don't you just install terminal server on your SBS and purchase additional licences? Buying a new OS just for that will cost you money and it's not necessary seeing that you already have SBS/terminal server installed. I think that with SBS you get 2 TS licences and then when you need more you have to buy them in packs of 5

"Can I install Virtual server on this box and then install another Server OS as a virtual machine?"
Yes you can. I suggest using Hyper-V though, which is much more performant than Virtual Server 2005 R2.

"If so, does that server OS also need to be 64bit?"
No, a 32-bit version will work too.

Yukovarcan: unless SBS has changed remarkeably since the 2003 days, it is limited to 2 TS licenses. It was not possible to increase this. That is why people run a seperate Terminal Server.

PowerToTheUsers: I asked my question partly because a while back I saw an article stating that SBS will not run as a virtual machine. I did not know if this meant it would not run Virtual Server either

If you wish to deploy the Terminal Services role in your SBS environment then purchase SBS 2008 Premium, which comes with a copy of Windows Server 2008 standard to install on a second machine. If your version is not Premium you might want to upgrade it cos you will get a copy of win server 2008 standard with that and then you can use it to install TS

vukovarcan: Our server is SBS2008 premium, but it did not come with a copy of server 2008. Maybe this is because our SBS is on oem version which came bundled with the Dell server.

PowerToTheUsers: In this case, SBS is already installed and running. Therefore it would be the parent. So i'll take a look at the workaround link you provided.

>SBS is on oem version which came bundled with the Dell server.

Talk to your software reseller about that.  We have volume licensing.  Within a short time period you can "upgrade" your OEM Microsoft OS to fully supported by Software Assurance.  I don't recall if it is 30 or 90 days.

I see so many posts from people who buy OEM Microsoft OS (especially SBS), not realizing the limitations.  Such as...no upgrades, and it dies with the machine.  You can't install it anywhere else.

SBS Premium came with an additional Server 2008 install CD and license key for a separate machine.

@ipendlebury
call your account manager at Dell and see if you can get a copy of Win2008standard free of charge because you own SBS2008 premium. see what they say

Thanks everyone for your help.  I will talk to Dell. I'm not so sure I will get an extra copy of 2008 when i've paid the oem price for SBS though.

PowerToTheUsers has given me the best answer to my original question. So he gets the points.

Thanks again.

Ian