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Scaling Out takes the infrastructure you’ve got, and replicates it to work in parallel. This has the effect of increasing infrastructure capacity roughly linearly. Data centers often scale out using pods. Build a compute pod, spin up applications to use it, then scale out by building another pod to add capacity. Actual application performance may not be linear, as application architectures must be written to work effectively in a scale-out environment.

Also see: Scaling Up

Source: https://packetpushers.net/scale-up-vs-scale-out/