Hardware virtualization allows dynamic deployment of different operating system flavours across different computers. It also allows increased flexibility in terms of tayloring OSs. A grid job or service can have its software dependencies satisfied in a VM image, and this can be shipped with the job or service as a complete execution environment. The openlab project, "OSFarm," aims to dynamically generate different Linux flavours and complete self-contained services, also called "virtual appliances," and maintain them in a repository. VM images can be several hundreds of MB large, so transferring them from a repository to a target machine can take a considerable amount of time and congest the network. A second project, "Content Based Transfer," uses hashes to identify identical blocks between images in order to speed up transfer and reduce network congestion. The talk will discuss the designs behind these two projects and show scenarios of usage.