Most traditional client/server architecture remains the same in the server virtualization environment where the client has an agent installed. However, this can become cumbersome. We still have to manage agents. There's processor overhead, which can be an issue, agent-based backup and virtual machines. This is especially true if multiple virtual machines are running on a single physical server, which is very much the case in a virtualized world. If those virtual machines all kick off the backup process at the same time, that CPU can be hit pretty hard and affect the applications.
So, an alternative is to use a different technology to perform the backup of the virtual machine disk image directly. This requires the virtual machine to be suspended so that a consistent capture of the virtual machine can be performed. Once the machine is suspended, the backup process can take place and then it can be restarted again. This works well, but suspending the virtual machine is an issue because taking an application offline is not acceptable in some environments. But, there are other ways to integrate with the virtualization solution and perform a snapshot of the virtual machine. Then, you can back up that snapshot.
Another thing you should be aware of is that you can recover the entire virtual machine, but you can't recover a single file within that virtual machine. So, you have to restore the entire virtual machine, remount the virtual machine and then recover the file.
Check out the entire Virtual server backup FAQ