A software arms race is the best way to end up with quality products.

When an application has no competition, it grows fat and lazy. But when a rival's breathing down a developer's neck, it pushes them on to greater things.

This has long been the case for virtualisation software, which enables you torun other operating systems(such as Windows) simultaneously with Mac OS X.

In this space, Parallels Desktop and VMware Fusion have traded blows almost since Intel Macs first appeared, and have improved with each release. We were mightily impressed with Fusion 2.0, and keen to see whether Parallels Desktop 4.0 could keep pace.

Second best software

Unfortunately for Parallels Desktop, although it was the first application to bring hardware virtualisation to Intel Macs, it now comes off like an inferior version of Fusion. In terms of features, it mostly matches VMware's effort – andvery occasionally beats it – but typically it's second best.

There's a new interface, which looks more Mac-like and– at a glance – prettier than Fusion's. It's a major improvement for Parallels Desktop, but Fusion feels more responsive, is more consistent, and provides better visual indicators, such as in the main window's status bar.

Then there's Coherence mode, which nestles guest operating system windows with Mac OS X ones. Fusion's Unity feature is practically identical, but lacks Parallels' juddery updates and confusing transitions.

Parallels Desktop now matches Fusion's multiple snapshot support, but whereas Fusion's workflow and interface are intuitive and polished, the Parallels Desktop equivalent feels like an afterthought, although some will perhaps prefer its tree-based display. And then there's multiple display support – one of Fusion's real crown jewels. In our review, we noted how Fusion picked up a connected external display without us having to do anything.

By comparison, Parallels Desktop has to be coaxed into using multiple displays in Coherence mode via a preference setting, and flatly refuses to admit multiple displays exist at all in Full Screen mode.

Performance problems

Perhaps the biggest disappointment, though, is performance. The previous version of Parallels Desktop often had us grinding teeth in sheer frustration as it brought our Macs to a shuddering halt when we had the audacity to try and run other applications alongside it.

Parallels claims version 4 brings major updates regarding speed and resource allocation, and this is true: everything is faster, and Parallels Desktop is less resource-hungry.

However, we also found its prl_vm_app process often chewed up processor cycles like nobody's business, and for a short while we were worried our MacBook would melt, such was the strain Parallels Desktop was placing on it.

With no Windows applications running at all, things noticeably calmed down, but with Fusion we accidentally left it hidden while running a bunch of browsers for three days. We doubt we could do that with Parallels Desktop for three minutes.

Appealing tools

At this point, you might wonder if Parallels Desktop 4 has anything going for it, but the fact of the matter is that it does. Indeed, most of the features mentioned earlier aren't actually bad – they just pale in comparison to Fusion. However, a slew of minor gems unique to Parallels Desktop makes it a better application than it otherwise might have been.

For example, putting Windows taskbar icons in the Mac OS X menu bar while in Coherence mode is a minor stroke of genius, and Clips are an interesting, user-friendly way of sending partial screen grabs from a guest system to your Mac. The auto-detection and auto-configuration of different flavours of Windows during installs was great to see, as were the various warnings Parallels offered while updating.

Safe Mode, which enables you to work with a virtual machine and only later decide to save changes, is also welcome. Sure, it's a snapshot in all but name, but its no-nonsense moniker grabs the attention, and will no doubt lead to fewer broken virtual machines after bad application installs.

New features

Parallels Desktop 4 also offers a few real standout new features. The first is for those who regularly work with multiple virtual machines.

Modality view enables you to scale down a machine's display – useful for monitoring several environments at once – and the ability to easily clone virtual machines or convert them to templates is a godsend for anyone managing dozens of the things.

Device support is also impressive in Parallels Desktop, and its SmartMount and SmartConnect features are an area where Fusion is clearly beaten.

The former essentially provides a means of transparently sharing connected external storage across the host and guest operating systems, and the latter enables you to choose which system captures newly connected external devices, such as printers and media players. A checkbox enables you to make this association permanent, or you can leave it blank for a one-time capture.

Added extras

Parallels also makes a big deal about bundled extras, boasting about "£100 premium value in bonus software" – a figure we think is a bit of a stretch in true value terms.

Sure, the licence for Parallels' Internet Security powered by Kaspersky is fine, but Fusion offers McAfee; Acronis True Image Home (for backing up your system) seems redundant now Parallels Desktop has better snapshots; and Acronis Disk Director Suite (a partition manager and disk editor) is superfluous to most people's requirements, especially since Parallels Desktop automatically increases virtual disk sizes when needed.

There's also an iPhone app, Parallels Mobile, which we assumed would be some kind of VNC/screen-sharing client. In reality, it doesn't do a great deal and is largely restricted to selecting a virtual machine from a list and suspending or restarting it.

Suitably, the comparison between Parallels Desktop and Fusion is almost like that between a decent PC and a Mac. Both are dependable, solid solutions, and both – in their own way – are quality products. However, by paying a little extra for Fusion, you're getting more, some of which is at first of an indefinable quality, but nonetheless obvious with extended use.

That's not to detract from Parallels Desktop overall. Despite our negativity in this review, it isn't a bad application as such – it's just Fusion is superior in key areas, such as robustness, performance and snapshots, and is therefore the best choice for newcomers.

For upgraders, things are less clear-cut – Parallels Desktop 4 offers enough improvements over version 3 to justify the £25 fee; however, an additional £30 gets you a better experience by switching to Fusion.

Therefore, we recommend even dedicated Parallels Desktop users check out the trial version of VMware's application before parting with any cash.