Well the future is now as it's very common now with regards to the pervasiveness of virtualization. I'm not sure what exactly you're asking as to whether virtual networking is going to be more common or if virtualization in general is going to be more common.
With regards to network virtualization, there are various implementations out there. VMware has it's vSwitch which comes in a couple of flavors: standard and distributed. Microsoft has their own hypervisor which has their own take on a virtual switch. Same goes with Citrix and their XenServer hypervisor. While Cisco doesn't have their own hypervisor, they've built their own virtual switch plug in for VMware called the Nexus 1000v. Cisco essentially took their Catalyst 2900 series switch and virtualized it. Cisco also has a virtual version of their ASA firewall which loads up as a VM in VMware.
There are lots of plans from various vendors to start developing virtualized designs for their existing products. From the networking side, it allows a manufacturer to make a single product which can do multiple types of services more easily. You can deploy a box that does say routing, firewall, WAN acceleration using a single set of processors/ASICS without requiring specialized services cards to be installed with their own processors and ASICs. Going with a hypervisor concept which hosts various VMs running services can also lead to better uptime for network devices. A new patch/update comes out. Don't want to schedule an outage window to take the network down. No problem. Just load up the new patch/update as a VM into the network device, dynamically switch to the new VM, and then delete the old VM. This promises to have a true ISSU (in service software upgrade) that is truly hitless.
Going forward, there's been a lot of activity around the emerging world of SDN (software defined networking.) SDN promises a whole new world and way of doing networking. No longer do you have to worry about whether your Cisco switch is compatible with a Juniper, Brocade, or Dell switch. You just wire them up together. In addition, you no longer have to worry too much about how you cable up and lay out your network topology. Don't want to have a proprietary implementation of a vendor's take on TRILL to have a multi mesh layer 2 network without having to worry about spanning tree. No problem. Go ahead and cable up multiple links where ever you want a redundant set of links. Want to have better control of how a specific network flow traverses your network, no problem. SDN promises to do all this and more by having a central controller that orchestrates all the network decisions on the network. All the physical network devices will now become commodity products adding greater flexibility in building networks and driving down costs. Major players in the network world are investing a ton of resources in developing SDN solutions. VMware purchased a company called Nicira for $1.26 billion which was driven up that high due to Cisco also expressing interest in buying the company. Cisco for a long time refused to acknowledge SDN was a viable path going forward but has now fallen in line with the other network players and has made their own acquisition of Cariden to bolster their SDN development efforts. Even companies like Dell are investing into SDN with a partnership with a SDN controller company Big Switch.
With regards to network virtualization, there are various implementations out there. VMware has it's vSwitch which comes in a couple of flavors: standard and distributed. Microsoft has their own hypervisor which has their own take on a virtual switch. Same goes with Citrix and their XenServer hypervisor. While Cisco doesn't have their own hypervisor, they've built their own virtual switch plug in for VMware called the Nexus 1000v. Cisco essentially took their Catalyst 2900 series switch and virtualized it. Cisco also has a virtual version of their ASA firewall which loads up as a VM in VMware.
There are lots of plans from various vendors to start developing virtualized designs for their existing products. From the networking side, it allows a manufacturer to make a single product which can do multiple types of services more easily. You can deploy a box that does say routing, firewall, WAN acceleration using a single set of processors/ASICS without requiring specialized services cards to be installed with their own processors and ASICs. Going with a hypervisor concept which hosts various VMs running services can also lead to better uptime for network devices. A new patch/update comes out. Don't want to schedule an outage window to take the network down. No problem. Just load up the new patch/update as a VM into the network device, dynamically switch to the new VM, and then delete the old VM. This promises to have a true ISSU (in service software upgrade) that is truly hitless.
Going forward, there's been a lot of activity around the emerging world of SDN (software defined networking.) SDN promises a whole new world and way of doing networking. No longer do you have to worry about whether your Cisco switch is compatible with a Juniper, Brocade, or Dell switch. You just wire them up together. In addition, you no longer have to worry too much about how you cable up and lay out your network topology. Don't want to have a proprietary implementation of a vendor's take on TRILL to have a multi mesh layer 2 network without having to worry about spanning tree. No problem. Go ahead and cable up multiple links where ever you want a redundant set of links. Want to have better control of how a specific network flow traverses your network, no problem. SDN promises to do all this and more by having a central controller that orchestrates all the network decisions on the network. All the physical network devices will now become commodity products adding greater flexibility in building networks and driving down costs. Major players in the network world are investing a ton of resources in developing SDN solutions. VMware purchased a company called Nicira for $1.26 billion which was driven up that high due to Cisco also expressing interest in buying the company. Cisco for a long time refused to acknowledge SDN was a viable path going forward but has now fallen in line with the other network players and has made their own acquisition of Cariden to bolster their SDN development efforts. Even companies like Dell are investing into SDN with a partnership with a SDN controller company Big Switch.