Remember back in the 80s, when the BIOS was actually an effective hardware abstraction layer--giving you a defined interrupt to ask the BIOS to, say, write to a disk--and the OS was just for module loading and scheduling and policy-based security? (Not that DOS did either of the latter.)
Well, Xen isn't the new OS; instead, the domU is the new BIOS, and hypercalls are the new BIOS interrupts.
I really hope to see Linux redone (or another *nix created) in this "unikernel" style, where everything hardware-like or HAL-like is taken out, and instead things like filesystem drivers are implemented directly in terms of hypercalls.
I also hope to see UEFI reimplemented as a resident domU, such that a plain old desktop or notebook computer could treat its user OS as a container-image to be slung around, rather than having it "own" the hardware. UEFI actually already supports this mode of operation--allowing you to boot "UEFI applications" that keep UEFI around to provide BIOS-like functionality--but I don't know of a single OS that makes use of that, rather than overwriting the processor interrupt vectors and claiming all of physical memory for itself.