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Minimum hardware requirements
Minimum memory requirements
Your results may vary, but we usually test appliances with 256MB of memory in a VM (VirtualBox) and they work just fine.
In a production environment you'll probably want more memory to take advantage of disk buffering in order to avoid IO bottlenecks. How much more memory depends on the specifics of your usage scenario (e.g., how much content you have, your load, usage patterns, etc.).
Optimizing a server for performance under high load is still beyond the scope this project but if everybody pitches in we'll get to that too eventually...