VMWare is very much alive, but they are focused first on the Enterprise space. They made a catastrophic pricing mistake, and so RedHat and MS have been having a field day taking their business the last year.
VMWare has back-tracked, but they jolted the market, and folks started testing the alternatives.
Pricing comparison:
http://captainkvm.com/2012/05/comparing-rhev-vsphere-and-hyper-v-pt-1/Another option you can consider is VirtualBox.
