What is VMware VDC-OS vStorage?

Hopefully, VMware's three pillars (vCloud, vClient, and VDC-OS) are a little more solid (not to mention closer) than the Three Pillars of Creation in the Eagle Nebula
VMware packed a lot into their 2008 VMworld conference, including an outline of their “three pillars” strategy, focused on vClient, vCloud, and something they are calling the Virtual Datacenter Operating System. While it is debatable if this last item really is an operating system, it’s certainly a major strategic change in messaging.
VDC-OS is divided into four “vServices” (Management, Cloud, Application, and Infrastructure), and one core Infrastructure vService is vStorage. Since my focus is enterprise storage, I thought I would take a moment to examine the current and future status of vStorage.
EMC’s Chad Sakac has taken up the challenge of communicating vStorage to the world, in a post to his blog, a pair of YouTube videos (multipathing, I/O dedupe), and (apparently) a session or two at VMworld. But I’m not sure it’s really entirely clear just what vStorage is and what this means to existing and future VMware storage developments. So let’s dive in and take a look.