Running a full VM, especially on the tools back then, took a ton of resources. Even server class machines only had 4 or 8GB of RAM typically.
Funny story (but not the ah-ah funny kind): such a service (hosting different customers on the same Windows machine) was still running in my previous company as of 4-5 years ago. They had long moved from physical hosts to VM, but were stuck with the legacy CMS/control panel which was more or less unpatchable (as in, the software editor didn’t exist anymore). About once a week, one of the host VMs would be taken over by hackers using one exploit or another. In that case they would kill the VM, boot a fresh one from a clean image, and start serving the customer data again after making sure it was clean. The service was not sold anymore but they had long-running customer contracts. It wasn’t making enough money to justify rebuilding it with modern software, but it was making enough that simply killing it wasn’t an option.
It wasn’t until I started architecting and developing in cloud environments that the true cost of Windows became apparent - when the cost of every project I do can more or less be directly tied to me.
I still development on Windows but I found an appreciation for deploying to Linux.
By the time I got to the point where I would think about doing something on my own, VPS hosting was so cheap, I wouldn’t have thought about anything besides a VPS like Linode.
https://blog.linode.com/2003/11/04/new-linode-96-plan/
96M RAM
3GB Disk Space
38GB xfer
$29.95