What Are Virtual Machines? How They Power Cloud, Edge, and 5G

What is a Virtual Machine?

Virtual machine is a software‑simulated complete computer system with full hardware functionality, running in an isolated environment. One or multiple guest machines can run on a single host.

Originating in the early 1960s, each VM has its own OS, independent of others, even on the same physical host. VMs typically run on servers but also on desktops and embedded platforms, sharing CPU, network, and memory resources.

Over the past two decades, server virtualization has allowed enterprises to utilize physical server capacity more efficiently, reducing the number of physical servers and saving data‑center space.

How Do Virtual Machines Work?

There are two main types: program virtual machines (e.g., Java VM, .NET, Parrot) that isolate a single program, and system virtual machines that completely separate the OS and applications from the physical computer.

System VMs rely on a hypervisor, which emulates CPU, memory, storage, network, and other hardware, creating a resource pool that can be allocated per VM. Hypervisors support multiple isolated virtual hardware platforms, allowing Linux and Windows Server to run side‑by‑side on the same host.

Key vendors include VMware (ESX/ESXi), Xen (Intel/Linux Foundation), Oracle (SPARC MV, x86 Oracle VM), and Microsoft (Hyper‑V).

Desktop users can also run VMs, e.g., macOS users running Windows.

What Types of Hypervisors Exist?

Hypervisors manage resources and allocate them to VMs. They are classified into two types:

Type 1

Bare‑metal hypervisors run directly on the physical host, accessing hardware without an intervening OS, offering higher efficiency and performance; examples include Microsoft Hyper‑V and VMware ESXi.

Type 2

Hosted hypervisors run on top of a host OS and manage hardware calls; examples include VMware Workstation and Oracle VirtualBox.

What Are the Advantages of Virtual Machines?

By separating software from the physical host, VMs allow multiple operating systems on a single hardware platform, saving time, management cost, and space. They also enable legacy application support, reducing migration effort.

Developers can test applications in isolated sandbox environments, verify OS compatibility without purchasing new hardware, and contain malware, as malicious code cannot affect the host.

What Are the Disadvantages of Virtual Machines?

Running many VMs on one physical host can lead to performance instability, especially if infrastructure requirements are not met, making VMs less efficient than bare metal. Additionally, a physical server failure brings down all hosted VMs.

Other Forms of Virtualization

VM success has spurred virtualization in storage, networking, and desktops. Network virtualization includes NaaS and NFV, using commercial servers instead of dedicated hardware, while SDN separates control and forwarding planes. VNF runs software‑based services such as routing, firewalls, load balancing, WAN acceleration, and encryption.

Virtual Machines vs. Containers

VM growth paved the way for containers, which virtualize a single application and its dependencies with far lower overhead, containing only binaries, libraries, and the app.

While some fear containers may replace VMs, VMs remain valuable for running multiple apps simultaneously or legacy software on older OSes.

Containers share a single OS, which some consider less secure than VMs that isolate both the OS and applications.

IDC’s Gary Chen predicts the VM software market will continue modest growth over the next five years despite maturity.

Virtual Machines, 5G, and Edge Computing

VMs are integral to emerging 5G and edge computing. Vendors like Microsoft, VMware, and Citrix extend virtual desktop infrastructure (VDI) to support remote work.

Carnegie Mellon professor Mahadev Satyanarayanan notes VDI requires ultra‑low latency, and VM‑based cloud can enhance edge device processing.

In 5G, network slicing uses SDN and NFV to deploy virtual network functions on VMs, delivering services previously limited to proprietary hardware.

These innovations trace back to the original VM concept introduced decades ago.