If you’re looking at hosting for your startup company, you’ve probably figured out there are a lot of options out there. Fortunately, no matter what you’re looking for, they all boil down to a few categories. Three of these categories are particularly relevant to startups: virtual private servers, dedicated servers, and cloud hosting.
Virtual Private Servers
A Virtual Private Server (VPS) is a server (generally a Linux server) that uses specialized software so it can pretend to be as many servers as needed. These “virtual” servers get rented out.
The main advantage of hosting on a VPS is value for the money. Depending on the type of virtualization, you may have full control over your virtual server, as if it were a physical server in a datacenter. However, you only pay a tiny fraction of the cost of renting a full server. Since most people never need the server’s full capacity, the hosting provider can rent many virtual servers for each physical server on which they’re located. The provider can also perform maintenance like upgrading or changing the physical server without significantly affecting the “virtual” servers. This makes VPS hosting an extremely efficient use of resources. As a result, VPS hosting is extremely popular: just about every hosting provider offers some kind of VPS solution.
The disadvantage of VPS hosting is that you’re still sharing server space with other customers. If you require a high level of security, it’s possible someone could hack into your virtual server from their virtual server on the same machine. Researchers at RSA have even recently showed it’s possible (but extremely difficult) to mount a “side channel” attack to read encryption keys from virtual servers you don’t own. At the same time, if you need to use a lot of memory, processing power, or network capacity, VPS hosting becomes expensive (and inefficient) quickly.
Dedicated server hosting is like virtual private server hosting, but without the virtual part. You get full access to your own server. This means you don’t have to worry about other customers using up processor time when you need it, or using their accounts to compromise yours. On the other hand, dedicated hosting is generally the most expensive kind. If you get “managed” dedicated hosting — where the hosting provider configures and maintains the server for you — it gets even more expensive. For companies that really need the horsepower a dedicated server offers, the raw cost is still often cheaper than the alternatives.
Cloud hosting is a specialized type of VPS. With cloud hosting, you get dedicated “instances,” which aren’t full servers. These “instances” might be spread over many servers in huge datacenters, instead of being hosted on one or two machines. Because they can be expanded and duplicated seamlessly, you can expand and contract the amount of capacity you’re using instantly… and expand and contract your bill instantly, too.
The main advantage of cloud hosting is, therefore, flexibility. Cloud hosting lets you go from using nearly zero capacity to dealing with huge traffic volumes, and do it dynamically. You only ever pay for what you actually need. That makes cloud hosting the preferred solution for situations where massive usage spikes come along, and a lifesaver for startups that suddenly get wide news coverage. On the other hand, because cloud hosting gives you much less control over the server, it’s generally used in addition to another solution — not exclusively.