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Presence, broadly defined as an event publish-notification infrastructure for converged applications, has emerged as a key mechanism for collecting and disseminating context attributes for next-generation services in both enterprise and provider domains. Current presence-based solutions and products lack in the ability to a) support flexible user-defined queries over dynamic presence data and b) derive composite presence from multiple provider domains. Accordingly, current uses of context are limited to individual domains/organizations and do not provide a programmable mechanism for rapid creation of context-aware services. This paper describes a presence virtualization architecture, where a virtualized presence server receives customizable queries from multiple presence clients, retrieves the necessary data from the base presence servers, applies the required virtualization logic and notifies the presence clients. To support both query expressiveness and computational efficiency, virtualization queries are structured to separately identify both the XSLT-based transformation primitives and the presence sources over which the transformation occurs. For improved scalability, the proposed architecture offloads the XSLT-related processing to a high-performance XML processing engine. We describe our current implementation and present performance results that attest to the promise of this virtualization approach.