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VPS is not a true virtual machine, VMWare is.
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VmWare is a product. VPS is a concept.
Vmware can be used as a VPS solution.
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A "VPS" is essentially a folder within the file system of the physical box, and the user will have unique permissions to this folder.
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No.
A vps is an isolation layer added on top of a physical machine, that runs in the ring 0 of the os layers.
http://en.wikipedia.org/wiki/Ring_%2...er_security%29
It allows a time-sharing access to the physical resources (cpu cycles, I/O access, DMA requests) shared between several isolated operating systems.
Now, depending of the virtualisation type (full virtualisation, like vmware, or hypervisor based like xen) your vps can be stored in a folder, but this is not at all related with the VPS itself.
The VPS datas needs to be stored. Be it in a specific folder, or in a container file, this doesn't change anything.
Having access to a directory on a server is the definition of shared hosting.
You upload your files there, and that's all.
You cannot decide which version of the webserver you are running, with which extensions, nor which db engine.
You only have what the sysadmin of the server gives you.
In a vps, you can manage your own web server, with it's own virtualhosts, the db which version runs and so on.
The only limitation, on linux at least, and depending the virtualisation solution, is that you might end up with a shared kernel.
Meaning that you cannot run a specific kernel version nor activate/compile specific modules for your kernel.
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I suggest you look into the differences between the two.
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And I strongly suggest you document yourself too, because you seem to confound several distinct notions...