Comment 19 for bug 642930

The watchdog drivers are present in the linux-image-extra-*-virtual package. Since they are not added installed by default to virtual installed, they must be manually installed by issuing the following command in the virtual machine.

sudo apt-get install linux-image-extra-virtual

Ubuntu disables by default all watchdog devices, so once you've installed the watchdog daemon, you'll have to add your device's driver to your /etc/module