After investing a lot of years and resources on Xen, IBM seems now definitively decided to focus on KVM.

During an interview with InformationWeek in fact, the IBM Vice President of Open Systems Development, Dan Frye, said:

One of IBM’s current goals is to "accelerate the maturation of KVM as a world class hypervisor.

More than that IBM has been clear about investing on KVM to make it a competitive alternative to VMware ESX:

We spent a lot of time working with KVM (Qumranet), Red Hat and others. KVM has been hardened rapidly. We want to be able to virtualize 64 or 128 guests on KVM. We want it to be equivalent to VMware.

http://virtualization.info/en/news/2010/05/ibm-wants-kvm-to-become-a-wor...