N applications are placed on M virtualized servers having power management capability. A time horizon is divided into a plurality of time windows, and, for each given one of the windows, a placement of the N applications is computed, taking into account power cost, migration cost, and performance benefit. The migration cost refers to cost to migrate from a first virtualized server to a second virtualized server for the given one of the windows. The N applications are placed onto the M virtualized servers, for each of the plurality of time windows, in accordance with the placement computed in the computing step for each of the windows. In an alternative aspect, power cost and performance benefit, but not migration cost, are taken into account; there are a plurality of virtual machines; and the computing step includes, for each of the windows, determining a target utilization for each of the servers based on a power model for each given one of the servers; picking a given one of the servers with a least power increase per unit increase in capacity, until capacity has been allocated to fit all the virtual machines; and employing a first fit decreasing bin packing technique to compute placement of the applications on the virtualized servers.