The memory optimization mechanism that was added in Windows Server 2008 R2 Service Pack 1 Hyper-V, Dynamic Memory (DM), improves with Windows Server 8. Here’s how.
Windows 8 is doing some really clever things; you might have heard of MinWin. That was an effort by Microsoft to reduce the footprint of Windows 8. The primary beneficiary was Windows On ARM (WOA) where tablets may have lesser resources than a normal PC. A second beneficiary is virtualisation; memory is a bottleneck in dense virtualisation, such as VDI or VM hosting, and being able to squeeze down the run-size of Windows 8 so we can squeeze even more running Windows 8 VMs onto a host. That means that Windows 8 can actually use less than 512 MB RAM that is listed as a system requirement. In fact, when idle, it can drop well below 512 MB RAM. In the lab at work, I’ve observed Windows Server 8 VMs with requiring as little as 312 MB RAM without being manually squeezed.
But there’s a catch: Windows boot requires 512 MB RAM. If we set Startup Memory to 512 MB then how could we get those savings if we couldn’t balloon down?
A “new” feature of DM is Minimum Memory. I say “new” because it actually existed under the covers in W2008 R2 SP1 but Microsoft really didn’t want us to use it. And that’s why the majority of us never knew it was there. Minimum Memory allows you to specify an amount of memory, which is smaller than Startup Memory, and allows an idle VM to balloon down to at least the Minimum Memory amount if there is unused memory in the VM. For example, a VM would start with 512 MB RAM. Once it is booted, and the integration components are started, if the VM is idle, it might balloon down from 512 MB to whatever it requires plus the buffer (20% by default).
Using Minimum Memory, we can allow idle VMs to throttle back their memory consumption to below their Startup Memory requirement. In a small farm, this might never happen. But in a large farm, such as VDI, hosting, or in a large private cloud, there very well may be many VMs that do little 90% of the time. Their freed up RAM can be used to service the needs of other VMs that do need the memory or to increase VM density on a host.
Source and more: http://www.aidanfinn.com/?p=12237