When we speak of 'hard security boundaries' most people, in this space, are comparing to existing hardware backed isolation such as virtual machines. There are many container escapes each year because the chunk of api that they are required to cover is so large but more importantly it doesn't have isolation at the cpu level (eg: intel vt-x such as VMREAD, VMWRITE, VMLAUNCH, VMXOFF, VMXON).
This is what the entire public cloud is built on. You don't really read articles that often where someone is talking about breaking vm isolation on AWS and spying on the other tenants on the server.
> This is what the entire public cloud is built on.
Well... The entire public cloud except Azure. They've been caught multiple times for vulnerabilities stemming from the lack of hardware backed isolation between tenants.
How Azure isolates VM's is completely unrelated, because containers are not VM's. And if you meant to assert that Azure uses hardware assisted isolation between tenants in general, that was not the case for azurescape [1] or chaosDB [2].
Unmanaged VM's created directly by customers still aren't relevant to this discussion. The whole point here is that everyone else uses some form of hardware assisted isolation between tenants, even in managed services that vend containers or other higher order compute primitives (i.e. Lambda, Cloud Functions, and hosted notebooks/shells).
Between first and second hand experience I can confidently say that, at a bare minimum, the majority of managed services at AWS, GCP, and even OCI use VM's to isolate tenant workloads. Not sure about OCI, but at least in GCP and AWS, security teams that review your service will assume that customers will break out of containers no matter how the container capabilities/permissions/configs are locked down.
A lot of use cases don't want that though. It's nice having lightweight network namespaces for example, just to separate the network stack for tunneling but still have X and Wayland working fine with the applications running there.