This new mechanism allows virtualized services to be run in an existing virtual environment.
Nested virtualization is a feature that allows you to run on a physical Hyper-V host other virtual Hyper-V hosts on which you can also run virtual machines which provide suitable services (Web server, domain controller, file server etc.).
This is a particularly effective way of deploying beta environments without having to use additional hardware. Another area where nested virtualization is successfully used is for setting up fully virtualized environments for departments. Several Hypervisors with separate administration can be operated on one virtualized host. With its additional high-performance hardware, complex virtual environments can be deployed with far less hardware required. In a data centre scenario, the footprint of a virtualization solution can be significantly reduced thanks to this technology.
What does it look like in practice? In the screenshot, you can see a physical Hyper-V host (VSRV-HV) on which two VMs are running. vNano01 is also a Hyper-V host on which you can run virtual machines too.