Virtual Servers vs. Physical Servers: Comparison and Use Cases

Virtual Servers vs. Physical Servers: Comparison and Use Cases

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The terms “virtual server” and “physical server” do not refer to a state of tangible or intangible existence but rather to the way the machines are structured.

All digital data and systems have to exist and be hosted somewhere in the real world. A platform that runs on the cloud, your personal accounts, a company website you visit online, or an app on your phone can all be traced back to where they are hosted: a real machine.

With that said, let’s look at two short standard definitions of both terms before we dive into the technology behind them.

  • Physical server: A physical server is a hardware device that is used to run applications and services. It has its own dedicated resources, such as CPU, memory, storage, and networking. Physical servers are used for on-premises operations and by organizations that need high-performing, isolated, and specialized digital systems.
  • Virtual server: A virtual server is a software-based replica of a physical server. It is built using a hypervisor which creates and manages virtual machines (VMs) existing on a top layer above the real physical hardware. Several VMs can be created on one physical server, sharing its resources. Virtual servers are used by cloud computing vendors to maximize their hardware resources, leveraged by developers as test environments, and power most of the online world.

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What is a physical server?

A physical server is any machine with chassis, CPU, GPU, RAM, storage, its power supply unit, network interface, OS, server application software, and other software. Physical servers are typically designed to run 24/7, and are not used for general computing but rather to run applications that serve other computers, such as web servers, hosting, or other server tasks.

No matter what size that machine is, whether a small desktop computer or a large rack-mounted server, and no matter where it is located, it will always be a physical server. Technically these types of machines are also called bare metal servers. Bare metal servers can be operated privately by organizations at their own locations, or accessed through top cloud vendors.

Key features

The most important difference between physical and virtual servers is that the former retain all the resources of the machine exclusively for themselves. This makes physical servers extremely secure and very powerful. Key features include of physical servers include:

  • Higher performance: Bare metal servers can provide better performance than virtual servers because the resources of the server are not shared with other users.
  • More isolation: Physical servers are more isolated than virtual servers, improving security and reliability.
  • More control: Physical servers give users more control over the hardware and software and their operations.
  • Dedicated resources: Physical servers have dedicated resources, such as CPU, memory, storage and networking. This means that these resources are not shared with other servers, which can provide better performance and isolation.
  • Scalability: Physical servers can be scaled up or down by adding or removing hardware components. This can be useful for businesses that experience fluctuating workloads.
  • Reliability: Physical servers are typically more reliable than virtual servers because they are not subject to the same virtualization overhead. However, they are considered to present single-point-of-failure risks.

Use cases

In the early 2000s, the large majority of servers in the world were physical servers. This means that digital systems were powered by “individual” machines, usually each company hosting their own to drive their IT systems.

Today, the scale has shifted and VMs run the majority of global server workloads. However, physical servers still have a place in the modern IT infrastructure and they are used for a variety of demanding workloads.

Popular use cases for physical servers include:

  • High-performance computing (HPC): HPC workloads require high levels of performance and scalability. Physical servers can be used to create HPC clusters, which can be used to run complex scientific and engineering simulations.
  • Machine learning (ML): Physical servers can be used to train and deploy ML models that require large amounts of data and computing power.
  • Database hosting: Database workloads require high levels of performance, security, reliability, and scalability.
  • Mission-critical applications: Mission-critical applications, such as ERP and CRM systems, require high levels of performance, reliability, and security. Physical servers are often used to host these systems.
  • Bare metal cloud computing: All top cloud vendors offer bare metal cloud computing — a type of cloud computing service. These are used by customers who demand high levels of performance, control, and isolation.

Industries that use physical servers

Industries that put the use cases of physical servers to work include financial services, healthcare, government and defense, aerospace, logistics, public services and utilities, manufacturing, and media and entertainment. These sectors value the reliability, performance, security, isolation, and ownership that physical servers provide.

What is a virtual server?

A virtual server is a digital replica of a physical server, usually created using only a fraction of the resources of the original physical server in order to power many identical virtual servers on the same hardware. Virtualization is the key to cloud computing and how big tech can offer efficient resources at global scales while maximizing their hardware.

Imagine you had a large rack mounted with all the state-of-the-art hardware and software needed to run a modern server. This machine has significant computing power, lots of storage, incredible speed, reliability, and security.

A customer comes along and wants to rent out your machine to host a site.

But then two more customers come in and want to rent your machine to manage a database. So you transform that rack-mounted physical server into a virtual server, creating several VMs that share the resources of the machine.

Each VM is assigned its own dedicated resources, such as CPU, memory, and storage. Each VM will then become a virtual server, running as an isolated system within the physical host.

At a larger scale, this exact scenario is driving the growth and scale of cloud computing.

Key features

There are several key features unique to virtual servers. These include:

  • Resource sharing: Virtual servers can share the resources of a single physical server, such as CPU, memory, and storage.
  • Scalability and flexibility: Virtual servers are easy to scale up or down by adding or removing resources digitally. They can also be easily migrated and backed up.
  • Isolation: Virtual servers are isolated from each other, which means that one VM cannot affect another VM. This improves security and reliability.
  • Reliability: Virtual servers can be more reliable than physical servers as they are usually designed to be redundant. If one virtual server goes down or experiences disruption or downtime, another virtual server can take its place. That being said, if the physical server goes down, it takes all its VMs down with it.

Use cases

The use cases of virtual servers are essentially endless. They are used intensely by every industry for all kinds of applications. Even regular users will engage with virtual servers every day without even knowing it as they browse online and log in to their platforms and digital accounts.

Some popular use cases for virtual servers include:

  • Web hosting: Virtual servers are used for web hosting because they are scalable and affordable.
  • Database hosting: Virtual servers are also a good choice for database hosting. Database servers often require a lot of resources, such as CPU and memory. Virtual servers can provide the resources that database servers need without the high cost of a dedicated server.
  • Email hosting: Virtual servers are also used for email hosting. Email servers need to be reliable and scalable in order to handle a large number of email messages.
  • Application hosting: Virtual servers can be used to host a variety of applications, providing the performance and scalability that these applications need.
  • Test and development: DevOps and DevSecOps teams often test, develop, and deploy their software, apps, and APIs on virtual servers as these are isolated safe environments.

In addition to these common use cases, virtual servers can also be used for a variety of other purposes including virtual desktops, cloud computing, HPC, and many others.

Virtual servers vs. physical servers: What are the differences?

Here’s a closer look at the differences and comparisons between physical and virtual servers.

Quick reference

Feature Physical server Virtual server
Architecture Simple linear structure: Hardware > OS > Apps Complex structure: Hardware > Hypervisor > VMs > OS > Apps
Cost Upfront hardware and software costs. No direct hardware or software costs. May incur hosting subscription costs.
Performance High performance: All hardware and software of the machine are fully dedicated to the customer or user. Performance depends on configuration: Shares hardware resources of a physical machine with other VMs.
Reliability Pro: Greater ownership.
Con: Single point of failure.
Pro: Redundant systems.
Cons: Misconfiguration risks.
Management difficulty No advanced skills necessary but maximizing resources of single machines can be complex. Requires advanced knowledge of VMs, hypervisors, and server technology. More complex to manage. 
Migration Complex, physical, and time-consuming. Rapid, digital, easy.
Security High levels of security and isolation but requires robust cyber and physical security measures. Easier to secure, customers usually only deal with digital security through built-in apps.


The main difference between physical and virtual servers, as mentioned in the introduction, is how the machines are structured, in other words, their architecture.

  • Physical servers have a simple, linear architecture. All the hardware is found at the lower layer: CPU, GPU, RAM, storage (HDD/SSD), power unit, etc. On top of that layer, the OS is installed. And finally, the higher layer is where apps and software are found.
  • Virtual servers have more complex architectures. A single virtual server structure can branch out numerous times, hosting several VMs. The basic architecture of a virtual server includes the bare metal hardware on the first layer, on top of which a virtualization layer or hypervisors are installed. Hypervisors in turn create and manage a third layer of VMs, and each VM will have an OS as an additional layer. Finally, apps and software sit on the final layer above the OS.


Virtualization technology tends to be more complex, and in some way more advanced, than physical servers — but it is also more cost-efficient when purchased at scale. 

  • Physical server technology can be costly. If your company wants to build a high-performance physical server it must have deep pockets. But for a fraction of that price, your company can access all the best resources that virtual servers offer.
  • Virtual servers are expensive to run, but inexpensive to rent. Creating and running a data center to offer global virtual servers is extremely expensive for cloud providers. They have to pay for all the hardware and software they need in order to provide those services to their clients. But again, for users, accessing this tech is much cheaper than building their own physical server.

Besides the hardware and software costs, usually when using a virtual server, companies are not responsible for its maintenance. If the hardware of a virtual server breaks down you will probably not even know about it as the vendor will make the switch rapidly. Physical break-ins, theft of hardware, server energy bills, or natural disasters, fires, floods, or earthquakes, are things that virtual server users — who opt for cloud virtualization vendors — also do not have to worry about.


When it comes to performance it is a tight race between physical and virtual servers. The truth is that there are several factors that will determine which of these systems will outperform the other. Configurations, hardware and computing capacities, software and network, are some of the issues that define performance server performance.

  • Physical servers for HPC: It is commonly understood that when a company deploys a physical on-premises server or rents out a bare metal server from a cloud provider it is because they are looking to run intense computing operations. Physical servers are often associated with high-performing systems.
  • Virtual servers for flexibility: Virtual servers too can be configured to operate at incredibly high levels, especially today as new hardware and software are coming out to power machine learning, AI, and other innovations. Additionally, many of the latest server hardware and software are extremely expensive. Virtual servers are therefore an easy way into the latest tech.


Just like performance, reliability will depend on the machine, the software, the networks, and the configurations. Both physical and virtual servers can be set up to be extremely reliable, in different ways and for different reasons.

  • Virtual servers provide redundancy: Virtual servers are, almost by default, offered as redundant systems. This means that even if the VM is disrupted, or the network associated with the VM experiences downtime, the system will continue to operate from another VM. This is not the case when it comes to physical servers.
  • Physical servers offer dependability: Building redundancy into physical servers is more technically challenging, uncommon, and expensive, so they tend to present single points of failure. On the other hand, they also have less that can go wrong, since they are not dependent on hypervisors and additional software layers, and can be troubleshooted locally, without having to rely on cloud provider technical support teams.

Management difficulty

Server management for both physical and virtual servers can be complex — though if you are operating a virtual server from an external provider, most of those tasks will be outsourced to the vendor.

  • Physical servers do not require advanced virtualization knowledge, but maximizing the full resources of a physical server can still be difficult. Individual configurations, optimization, monitoring, and visualization can be challenging for bare metal servers administrators.
  • Virtual server technology does require advanced skills, as the technology has evolved significantly. There are many vendors that offer virtual server management cloud platforms with user-friendly interfaces. On the other hand, those that leverage the most advanced virtualization tech have access to a wide range of tools to maximize VM performance. They can boost visualization with centralization platforms. Managing virtual servers at this level requires know-how and experience, but the benefits will outweigh the challenges.


It is easier to migrate virtual servers than physical servers. This is because virtual servers can be easily copied from one physical server to another. Users can migrate a VM in just a couple of clicks.

In contrast, physical servers need to be physically moved and reconfigured. This means manually backing up the entire system and loading it into a new machine.


Both virtual servers and physical servers can be secure, but they require careful configuration and management. Additionally, both technologies offer some level of isolation.

  • Virtual servers can be vulnerable to attacks such as hyperjacking if the virtualization software is not properly configured. While VMs are typically isolated from each other and the host server, they do widen the attack surface.
  • Physical servers can be vulnerable to physical attacks if they are not properly secured. They are highly isolable, but if an attack does get through, they represent a single point of failure. Still, the same can be said for the underlying physical server running VMs as well.

Bottom line: Virtual servers vs. physical servers for your business

Virtual servers and physical servers both have their own advantages and disadvantages. The best choice for your business will depend on your specific needs and requirements.

Overall, virtual servers are a good choice for most businesses. They are affordable, offer excellent reliability and access to the latest tech, and are extremely scalable. However, physical servers may be a better choice for businesses that need greater ownership, higher performance, and airtight security.

Explore our analysis of the best server virtualization software to start taking advantage of the latest advances in virtualization technology.

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