A Virtual Machine (VM) gives you all the benefits of a dedicated physical server without the cost of managing and housing dedicated physical equipment. A VM provides the flexibility to increase and decrease system resources including disk, CPU and RAM easily, and at a much lower cost. The underlying hypervisor (VMware vSphere) manages system resources to ensure that each VM is given the resource it requires.
If you have a customer application that requires the ability to host large numbers of websites, a VM can give you this flexibility. You are in control of what software is running on your VM and you have full management access. Access is provided by SSH or Remote Desktop Connection and fully encrypted VPN tunnels are available as an option.