Slash Server Costs by 75%: The VM vs. Container Showdown
Cost benefit Analysis: Virtual Machines vs Containers - Save up to 75% in annual server maintenance costs
Enterprise CTOs can save up to 75% in annual server maintenance, administration and facilities costs when using a container- versus a virtual machine environment to run their workloads.
This blog post explores why a move away from virtual machines to containers is recommended and how it can be done. We start by explaining the basics of application modernization, virtual machines and containers, after which we dive into the benefits and a cost-benefit analysis of both solutions.
Application Modernization
Application modernization is a process of refining and revitalizing old and outdated business systems to improve operational efficiency, minimize overhead costs, and be future proof for emerging IT innovations. It encompasses various strategies and approaches, including re-platforming, re-hosting, re-architecting, refactoring, or replacing legacy systems entirely with modern alternatives.
According to the Markets and Markets report, the application modernization market size will witness a growth rate (CAGR) of 16.7%, with $15.2 Billion in 2022 to $32.8 Billion by 2027. Therefore, it's high time businesses start to modernize applications to elevate their end-user experience and embrace opportunities for growth and expansion.
What are Virtual Machines?
VMs are built on physical machines, with their primary component being a hypervisor, a host server that allows VMs to access the required computing resources. Each Host runs guest OS's. These guest OS's have allocated CPU, Disk, Memory and other virtualized peripherals attached via the hypervisor. The image below illustrates the four parts of the VM architecture. Each guest OS inside the virtual machine has it's own OS kernel. Just the same as a non-virtualized operating system.
What are Containers?
Containers are virtualized, isolated application packages; they contain everything needed to run a piece of software, including code, system tools, libraries, and settings (called dependencies.) Containers are portable, meaning they can run across different development environments so that developers can test software on different environments without worrying about dependency conflicts with the underlying system or other applications or processes. They share the OS kernel and isolate the application processes and their dependencies in their own user space, whilst allowing for greater application density per host.
Benefits of moving to Containers:
- Continuous innovation and adaptation
- Effortless intersection of traditional, cloud-native, and hybrid applications
- Improved agility and compliance
- Maximized return on investment (ROI)
- Improved uniformity in the organization and its processes
- Minimized technology risks
- Enhanced flexibility
- Enhanced performance and user experiences
- No vendor lock-in as you pick and choose technologies as per your requirement
- Faster startup times vs VM’s
Why modernize away from traditional VM’s?
Legacy applications that run on VM’s or physical servers, once the backbone of many enterprises, are now often seen as roadblocks to progress. As technology advances and user expectations shift, the need for modernizing these applications becomes increasingly apparent. This process, known as application modernization, is not merely about updating software; it's about future-proofing businesses and unlocking new growth opportunities.
After Broadcom announced that they were acquiring VMware for 69 billion dollars there were a lot of anxious customers that were holding their breath for what was going to happen next. As expected, Broadcom announced that they were removing the option of perpetual licenses and moving to a subscription-based license.Many enterprises we are speaking to are reporting at least a doubling of costs with even more increases expected in the short term. Per April 10th, the minimum purchase agreement with VMWare will be 72 cores per CPU - up from 16 cores. And for 2026 an additional 20% increase is expected.
Demonstration on how Containers save you money…
An experiment by IBM on virtual machines vs containers was conducted to test which is more efficient and which technology saves you money in the long run. The test compared a client simulated banking application transaction suite running IBM WebSphere Hybrid Edition in an x86 virtualized environment using Red Hat OpenShift containers versus virtual machines.
Although JMeter drove the same workloads to the virtual machines and container environments, testing found that CPU utilization with the virtual machines was significantly lower than with the containers’ due to memory constraints in the VM environment. Without available memory, additional workloads (virtual machines) to improve CPU utilization could not be run within the existing configuration.
Conversely, testing found that in the container environment all of the resources were shared, freeing up memory for more productive use. With additional memory more application instances could be hosted, driving more CPU resources and resulting in more effective use of all resources within the existing configuration.
Financial Impact
The improved utilization and throughput reduced the amount of CPU and servers required to deliver the same workload, which translated into significantly lower infrastructure costs. To evaluate the financial impact, we examined annual infrastructure costs to run the same amount of workload throughput, that is, 33 containers versus 32 virtual machines. The cost model found that transaction workloads running on x86 can provide a 75% reduction in annual server maintenance, administration and facilities costs using a Red Hat OpenShift container environment versus a virtual machine environment.
Summary
Containers can have a significant impact on the efficiency of your IT infrastructure. With access to shared resources within a given environment, containers can leverage more memory and CPU, avoiding memory constraints that can result in low CPU utilization. More effective use of server resources means decreased system requirements, fewer servers, less upkeep and lower infrastructure costs.
For the many reasons explored in this blog, containers offer a variety of efficiency and cost-savings benefits when compared to traditional VM-based application deployments.
How AppFactor Helps
AppFactor provides fast, reliable and secure automation to intelligently analyze, extract and rebuild applications and their components into optimized containers. In minutes, the platform facilitates a migration away from VM’s to a modern application delivery and runtime environment such as cloud-native services like AWS Fargate, ECS, Azure Container Apps, Google Cloud Run or Kubernetes platforms.
Not only does this significantly reduce ongoing cloud costs, but it also reduces the time and costs involved in any future modernization and maintenance journey.
AppFactor can also leverage AI to generate the optimal container image. The process iteratively and recursively handles errors when making changes and creating the image. This way AppFactors ensures lean, secure, and optimal containers for image size, performance and security.
