Current trends suggest that the number of memory chips per processor chip will increase at least a factor of ten in seven years. This will make DRAM cost, the space and the power it consumes a serious problem. The main question raised in this research is how cost, size, and power consumption can be reduced by transforming traditional flat main-memory systems into a multi-level hierarchy. We make the case for a multi-level main memory hierarchy by proposing and evaluating the performance of an implementation that enables aggressive use of memory compression, sharing of memory resources among computers, and dynamic power management of unused regions of memory. This paper presents the key design strategies to make this happen. We evaluate our implementation using complete runs of applications from the Spec 2K suite, SpecJBB, and SAP — typical desktop and server applications. We show that only 30% of the entire memory resources typically needed must be accessed at DRAM speed whereas the...