There are basically 3 types of hosting available – shared hosting, VPS hosting and dedicated hosting. Of course there are differences between these three and knowing which type of service is best for your website is very important.
As the name suggests, in shared hosting, a lot of websites are hosted on the same single server (generally with low traffic). In shared hosting, every account (site) is sharing all the server resources such as diskspace, RAM and CPU. They also share the same IP as well as server hostname. It is similar to living in an apartment complex, here all of the residents are living in the same location and sharing all the available resources such as the parking lot, the pool, and play ground.
One of the advantages of using shared hosting is that it is very cheap and affordable while the disadvantages is that if one of the site is getting a lot of traffic then other sites hosted there will suffer. They also do not allow for customization of firewalls or software.
VPS (Virtual Private Server)
Created by building a virtual partition within a server, VPS or virtual private server grants features such as easy transfer of thousands of GBs of data and dedicated IP addresses. Just like shared hosting, all accounts are hosted in the same server but each of them is separated by the created partition so that they have independent features such as disk space and RAM.
It is similar to owning a Condo – although you are still living in the same building with others, but there is significantly less residents per building and assigned parking. Here you are alloted resources that are not shared by everyone. Although the over all CPU time and memory will be shared across all accounts but the portions of these resources are dedicated to each account. Beside allowing for some customization of security and firewall performance, VPS hosting also allows us to specify which IP addresses may access certain information. VPS is like a dedicated server in terms of functions but they offer an affordable price compared to a dedicated server.
Dedicated server is the perfect choice for customers who want to have a full control of their server. Dedicated hosting can be compared to owning a house. There is no sharing or virtualization of the resources. Dedicated server is used when a user expects to get huge traffic. This is suitable for you if you need to have complex app, secure informaton as well as customized option in your website.