What is the difference between a VPS and a VM?

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A group of the greatest philosophers of our time — The Jackson 5 — once quipped, “A-B-C. It’s easy as 1, 2, 3.” And in the world of IT, we sure do love our alphabet. There is no shortage of acronyms and initialisms, and making heads or tails of their meanings can sometimes be challenging. 

Such is the case in virtualization, particularly when it comes to a virtual private server vs a virtual machine (VPS vs VM). Some use these terms interchangeably. But these two IT concepts aren’t the same. There are subtle, critical differences that you need to know as you navigate the realm of modern-day digital infrastructure. 

VPS vs VM defined

A VPS uses virtualization technology to divide a central physical server's resources into several independent virtual instances. Each of these instances acts as its own server. Two adjacent instances can run completely different operating systems, software, and operations, even though they exist on the same physical parent hardware.

VMs use virtualization a little differently. These virtual instances still exist as partitions of a larger physical environment. However, the difference is that a VM setup is less independent than a VPS setup. In the case of virtual machines, users still have root access to control resources and settings from the parent level.

The partitions created in a VM scenario also work together as smaller parts of a whole. In a VPS scenario, each partition acts as its own separate computer or server environment. But how does virtualization make these two different scenarios possible? 

Understanding virtualization

Before discussing VM vs VPS environments, we need to understand the overarching concept of virtualization. Virtualization uses a hypervisor or abstraction layer installed on a parent server to partition and divide its resources. The hypervisor layer decouples the server’s resources from its physical environment, enabling their distribution across as many virtual instances as needed.

Organizations benefit from virtualization because they can launch their digital infrastructure — or spin up new devices as they scale — quickly and for a fraction of the cost of legacy IT infrastructure. Teams leveraging virtualization also experience a higher level of cybersecurity.

By creating partitions within a parent server, you’re creating several smaller, isolated environments. If one virtual instance is infected or attacked, IT teams can quickly identify and remediate that threat without crossing over into other partitions on the server. Depending on your network configuration, this feature may prevent cyberattacks from affecting mission-critical files and causing significant operational and financial damage. 

Types of virtualization

There are five primary virtualization types:

  • Hardware: IT technicians virtualize hardware by creating virtual versions of computers and operating systems. Then, these virtual resources come together into one physical server environment. Next, a hypervisor layer enables virtual instances within the physical server to access this pool of resources. This is sometimes called server virtualization. The process increases the efficiency of the server environment. It can also run different operating systems simultaneously, essentially turning each virtual instance into its own computer. 
  • Storage: Storage virtualization pools storage resources from physical devices and creates an environment all machines can access to boost their storage capability. IT teams can manage these resources from a central dashboard.
  • Network: IT admins can break down overall network bandwidth into smaller individual channels. System admins can assign and reassign each channel to a specific device. Network virtualization aims to improve the network’s speed, security, and resource availability. 
  • Application: App virtualization allows IT teams to run one version of an application separately from a particular device. This prevents system admins from having to perform the same management tasks repeatedly. Typically, an application exists in a data center or server room, and users access it via a remote display protocol. System admins can interact with the app and make patches. They can also change settings once and distribute those changes to other instances of the application automatically. 
  • Desktop: There are several different types of desktop virtualization, but the overall concept involves decoupling a computer’s operating system from its physical environment and turning a variety of remote devices into virtual computers. Employees connect to a virtual desktop via a remote display connection. The remote client devices can be traditional PCs, tablets, or smartphones. 


Virtual private server (VPS) hosting makes fast, reliable hosting service available to the masses. When a business launches a website, a server must exist to support its data or code online. But, the cost of acquiring, updating, and managing physical server equipment can be prohibitive for some organizations. 

Virtual private servers take the resources of a physical hosting environment and decouple and partition them to make them available to multiple users. This structure makes hosting much more affordable to the end user, as a third-party hosting provider is typically responsible for the purchase and upkeep of all IT hardware. 

Here are some features you can expect from a VPS hosting package. 

Dedicated resources

One of the pros of VPS hosting is that the resources you receive belong solely to you. This is a departure from cloud or shared hosting, through which resources are pooled together to serve a broad number of customers. You’ll also have access to much larger RAM and CPU capacity in VPS vs VMs or shared hosting.

More control

Companies that opt for VPS over a virtual machine have more control, as VPS is easily scalable, allowing businesses to add or remove resources as necessary. 

You’ll also be able to configure your server environment however you choose. End users typically don’t have access to server controls in shared or cloud hosting environments. However, with VPS hosting, each virtual instance is its own dedicated environment. Users have complete control over server settings and resource allocation within their respective VPS.

The only scenario in which you may relinquish some control is if you choose VPS managed hosting. In that case, your third-party hosting provider would manage and monitor your hosting environment. It will cause you much fewer headaches and allow you to focus on building your business, but you have to decide which level of control is right for you. 

More expensive

If we look at the pricing scale of all hosting packages — shared, cloud, VPS, VM, and dedicated — VPS falls somewhere in the middle. While it’s true that it’s more expensive than a shared or cloud environment, it’s more budget-friendly than a traditional dedicated server. 

As with anything else, you also get what you pay for. The extra bump up in price you may pay for a VPS environment affords you key features like:

  • Easier server management.
  • More security.
  • Instant scalability.
  • Increased reliability.


Virtual machines (VMs) operate much the same way as physical computers. The difference is that VMs use software to run their programs and operating systems. A standard computer has physical resources—like memory, RAM, and CPU processing cores—to perform these operations.

In a virtual machine scenario, a physical parent server provides the necessary resources to power the VMs. Each VM exists as a partition (or subsection) of this parent machine but operates as its own computer. Technically speaking, the parent server acts as the host, and each VM is a guest machine.

Below are a few of the features you can expect from virtual machines.

Shared resources

Virtual machines share the resources of the parent (or host) server. Organizations or third-party providers can partition their physical servers into as many virtual machines as they see fit.

Unfortunately, this can occasionally cause challenges with a concept known as VM sprawl. This is the idea that since you can create as many VMs as you see fit on a server, some IT techs create more VMs than necessary.

Occasionally, an overprovisioning scenario arises when a system admin creates more virtual instances than the host machine's resources can accommodate. This may leave some virtual machines with insufficient resources to run the operating systems or software applications they need to contribute to the company’s end goals. 

Less control

The hypervisor or abstraction layer plays a critical role in giving VMs their functionality. But, since this layer rests on the parent server’s operating system, it can also act as a barrier — preventing root access to the parent server’s settings and resources.

Considering this, virtual machines offer less control than a VPS hosting structure. Fortunately, for most business owners, the level of control VMs provide is more than enough. Additionally, you shouldn’t even have to worry about these configurations if you partner with the right hosting provider.  

Less expensive

Virtual machines are among the more budget-friendly options on the scale of hosting packages. Since resources are shared among several VMs, the fees are considerably lower than VPS or dedicated. You may pay more than shared or cloud hosting, but only a little.

Key differences between VPS and VM

Many within the hosting industry tend to use the terms VPS and VM interchangeably. And while these two concepts are closely related, they’re not synonymous. There are subtle but critical differences between these hosting concepts.

Isolation and security

You’ll experience the benefit of isolation and increased security in VPS vs VM hosting. Think of your VPS environment as a virtual dedicated server. All the resources you have access to are yours and yours alone. This isolation provides not only a boost in performance but also a boost in security.

In a VM environment, resources are shared. Therefore, if another user’s virtual machine succumbs to a cyberattack, it’s much easier for that threat to spread laterally across VMs into your machine.

A virtual private server doesn’t have this problem. The natural isolation a VPS provides will keep your system more secure. If another VPS on the host server is infected, there’s virtually no chance that cyberthreat will affect your system resources or mission-critical data. 

Scalability and flexibility

VPS configurations also edge out VMs when it comes to scalability and flexibility. Since a VPS acts as a dedicated server, you can instantaneously add or remove resources as necessary.

Since VMs share resources, you’re confined to the resources available on the host server. Additionally, you may run into the overprovisioning issue we mentioned before. If too many resources are allocated to a neighboring VM, you may be out of luck when running the OS and software applications you need to grow your business. 

Performance and efficiency

Some VM use cases enable them to greatly improve performance and efficiency (especially if you use the VMware framework). Organizations can leverage VMs to run multiple computers at the same time. They’re also a great way to isolate new applications during development and test new settings or features.

Certain uses of a VPS can also streamline system performance and make organizations more efficient. IT admins can scale and launch new software without many restrictions in a VPS environment. This particular hosting structure is also great for accommodating high-traffic websites since the dedicated resources make connectivity and uptime more predictable than a shared, cloud, or VM environment. 

Choosing between VPS and VM

The choice between a VPS vs a VM is an individual one. Ultimately, it will depend on your business’s needs, budget, and security concerns. 

Making the right choice is important. Your hosting infrastructure is essentially the backbone of your business’s online presence. Wouldn’t it make sense to trust the pros knowing that's the case?

Liquid Web offers managed VPS hosting backed by the best customer service in the industry. Our team of experts is available 24/7/365 to address any problems, concerns, or questions you may have.

Our decades of experience have led to relationships with some of the best third-party vendors in the industry, enabling you to enrich your hosting with third-party security, monitoring, and management tools that are unrivaled in the marketplace.

So, contact the Liquid Web team today. It’ll be the beginning of a beautiful partnership that will help you transform your business. 


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