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Web Hosting Options: 3 Types of Hosting

Updated on February 6, 2015

For web hosting beginners: this guide explains the difference between your 3 main options of web hosting: shared, VPS and dedicated. Pros and Cons, as well as the practical uses for each choice are also included.

Use this guide to help familiarize yourself with the differences between these three hosting plans -- the one that's right for you and your websites will be apparent after reading it!

What Is Shared Web Hosting?

With a shared host, it's easy to find an amazing deal. These days, it's not uncommon to find monthly fees as low as $4. It's the most cost effective way to host smaller websites in a relatively reliable atmosphere. In shared hosting, you're "sharing" the space on a server with dozens of other customers. Of course, all of the accounts are strictly partitioned and nobody else can access your own account.

There are a few cons: note that there's a thing called the "bad neighborhood" -- this can be defined as your 'server neighbors' of whom are practicing blackhat techniques, such as email spamming, mirror sites, porn/gambling/warez sites and other objectionable stuff. Google has been known to penalize IP addresses. So, if your server has shifty people doing shifty things, your website(s) might suffer the consequences -- even if you did nothing wrong.

To alleviate this issue, try to splurge a little more and get dedicated IPs. This may or may not resolve the issue in severe cases (however, web hosts -- especially big name ones -- do not have tolerance for black hatters and deal with them swiftly). I'm sorry to be causing what may be un-due fear mongering, but this is the grim reality of sharing server space with strangers.

Of course, stick with premium shared server hosts like HostGator, HostMonster and others, and you'll have nothing to worry about. Don't plan on running a resource hog of a site on a shared server, such as a video site, Flash game site or social networking community: save that for a VPS or dedicated server.


  • The most affordable web hosting option, by far
  • Great for hosting one (or many) smaller websites


  • Typically does not offer the resources necessary for rapidly growing websites
  • Performance is affected by other resource-hogging websites on the same server as you
  • Tech support is usually at a minimum

What is VPS Web Hosting?

VPS web hosting costs a bit more than shared web hosting (approximately 7x more, for similar specifications). However, you have your own little "corner" of the server, and your sites' performance isn't as impacted as they might be with a shared hosting, that guy with the massive video sharing site won't be bogging you down.

VPS hosting, much like other hosting plans, come included with all of the bells & whistles, including managed service, cPanel, expandable RAM and disk space, and higher tier bandwidth limitations. VPS web hosting is typically the right choice for any small business running multiple brands, or any internet entrepreneur of whom is looking to maintain several websites, with more to come in the future.

✔ Pros:

  • Affordable for small businesses: the ultimate cost-effective alternative to dedicated hosting
  • Typically offers more server resources than you'll ever use!
  • Typically offers 24/7 ticket-based tech support

☒ Cons:

  • You're still residing on a server that also hosts other customers, although their performance will rarely ever affect your account (especially if the web host offers burst RAM)

What Is Dedicated Web Hosting?

The top tier in the web hosting family: with dedicated hosting, the server is yours. Well, not technically - you don't own the physical hardware, but the box is "dedicated" only to you, no other customers reside on it.

Dedicated hosting is not for the "little guy." It's expensive, especially for a work-at-home entrepreneur who has little cash to budget for it. Expect to pay in the ballpark of $150-200/month for a lower-end dedicated account.

With a dedicated server, you have complete control over the server box itself, and can tweak its settings, manually restart the box, or do anything else you desire. Dedicated servers, by default, usually do not include managed services. So, you'll have to synch it to your cell phone in case something goes wrong at 3:00am. In other words, bank on paying extra for managed services - which will significantly increase your monthly fee.


  • Offers a wealth of server resources for websites that are top performers and demand a lot of resources
  • You "own" the box -- that is, no other customer resides on it, but you
  • The only web hosting scenario where you'll have full authority over the box's operating system and server-side software


  • Entirely un-affordable for economical entrepreneurs and start-up small businesses with no or low budgets
  • Requires an intermediate to advanced knowledge of server maintenance, as well as cPanel or possibly even shell commands

Web Hosting Options & Services Explained

Here are typical terms you'll come across when looking at a web host -- it's important that you're knowing what you're getting into before you actually pay for a particular hosting plan!

  • Operating System: This is always a choice between Linux or Windows. The vast majority of customers choose Linux, and it is unofficially the "default" option when you're looking at a web hosting package.
  • Memory: A synonym for "RAM," the more memory you have, the more your server will be able to handle multiple processes running in the background (web scripts, server-side scripts and others). Memory is a huge consideration: more is always better.
  • Storage: A synonym for "hard disk space." This is equivalent to the hard drive on your computer -- except it's the hard drive space you're given on your server. It allows you to store more files and have more websites.
  • Transfer: A synonym for "bandwidth." Bandwidth is the data being transferred by your websites, and it is measured in gigabytes and terabytes. Massive websites that receive many visitors per day and use big files (videos, etc) inevitably use a lot of bandwidth. If you meet your bandwidth limit, the server host will traditionally either send you a warning, or just shut down your account until you upgrade to the next pricing tier.
  • RAID: Standing for "redundant array of independent disks," this is a hard drive setup where your data is processed amongst multiple hard drives (instead of just one) to improve data performance and reliability.
  • Platform: This is the actual "visual" aspect of your operating system; it's basically an interface, like Microsoft Windows. The two most popular ones for Linux are CentOS, which is free, and cPanel, which is typically comes with an extra monthly fee.
  • IP Addresses: Typically, servers are given one IP address, which is kind of like having one phone number. Having more than one is only really needed if you're running an eCommerce website and accepting credit cards on it, or if you plan to use your server to start your own web hosting business, and intend to create more than one reseller account.
  • Managed: A "managed" service means that you'll have a tech support ticket system where you can ask for either casual or urgent questions. Obviously, this is a must-have if you're a server newbie and don't trust yourself when something sticky happens.
  • Domains: Some plans might allow for "x" amount of domains, and some have unlimited. This is referring to the number of domain names you can create an account for on your server. (An account can also be thought of as a website).
  • Cloud Hosting: One of the newer kinds of hosting. On a cloud-hosted hierarchy, your website is hosted by multiple servers, which are inter-connected. This, in essence, gives unlimited processing power -- although some argue that it can be less secure.


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