App Service, Container Apps vs a VM? · Decisions

The verdict

App Service is managed PaaS for web apps and APIs — deploy code, Microsoft runs the OS. Container Apps is serverless, Kubernetes-based PaaS for containerised microservices and event-driven jobs, with scale-to-zero. Virtual Machines is IaaS — full OS control, and the work that comes with it. The deciding factor is control against management: App Service for a code-first web app, Container Apps for containerised or event-driven microservices needing scale-to-zero, and VMs only when you genuinely need OS-level control or software no PaaS supports.

Head to head

Criterion	App Service	Container Apps	Virtual Machines
Hosting model	Managed PaaS	Serverless PaaS, built on Kubernetes	IaaS — you provision and manage VMs
Deploy unit	Code (.NET, Java, Node, Python, PHP) or a container	A container image	A VM / OS image
Scale to zero	No — plan instances always run	Yes — most apps scale to zero	No
Autoscaling	Built-in autoscale rules	KEDA — HTTP traffic, events, CPU/memory	Virtual Machine Scale Sets
Pricing model	Per App Service plan instance	Serverless consumption — vCPU / GiB-seconds	Hourly per VM size + OS
Control & OS access	Platform manages the OS — no general access	Abstracted Kubernetes — no OS or K8s API	Full — patch and install anything
Best workloads	Web apps, REST APIs, mobile back ends	Microservices, event-driven and background jobs	Anything — lift-and-shift, HPC, SAP / Oracle
Ops burden	Low	Low	High

When to pick which

Pick App Service when

You have a web app, REST API or mobile back end in a supported language.
You want deployment slots, CI/CD and managed certificates without orchestration.
Traffic is steady and predictable — scale-to-zero is not required.

Pick Container Apps when

You run containerised microservices or event-driven jobs and want scale-to-zero.
You want KEDA autoscaling, Dapr, and revision-based blue/green.
You want Kubernetes patterns without managing a cluster or its API.

Pick Virtual Machines when

You need full OS control, or must run software no PaaS supports.
You are doing a like-for-like lift-and-shift of an existing workload.
You run specialty workloads — SAP, Oracle, HPC, or your own Kubernetes.

Sources

Choose an Azure compute service — https://learn.microsoft.com/en-us/azure/architecture/guide/technology-choices/compute-decision-tree
Azure App Service overview — https://learn.microsoft.com/en-us/azure/app-service/overview
App Service plans and tiers — https://learn.microsoft.com/en-us/azure/app-service/overview-hosting-plans
Azure Container Apps overview — https://learn.microsoft.com/en-us/azure/container-apps/overview
Azure Virtual Machines overview — https://learn.microsoft.com/en-us/azure/virtual-machines/overview

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