Yes. Server Edition needs to be installed on VM host machine in order to create Image Based backup plan that will backup host.

Thanks for the reply (c:

So if a client had a VM backup licence (say 2 slot) they would also be able to image the host machine if they so chose (as server would be included)?

Yes, that is correct. Image Based functionality is included in VM edition so client will be able to do Image Based Backup of the host as well as VM backup of guest machines.

Excellent that is what I was hoping/assuming.

Many thanks again.

This software was able to handle granular restores as well as the entire VM backup. how many VMs can a server host?

The Backup VM host machine stores a backup copy of all virtual disk images and configuration also. What is the process of backup?