Dedicated, Virtual or Shared Web Hosting?

There are so many web hosting plans out there—what's the difference? Before you spend time picking which perks you want, you must decide which level of control will best suit your business. What you need to know to make an informed decision is that there are three general hosting environments to choose from: dedicated hosting, virtual hosting and shared hosting.
First, what does a web hosting company offer? A good hosting company provides a fast access line to the Internet, security, fire protection, an uninterrupted power supply, computer hardware to house your website, server setup and optional software maintenance. Leasing these assets from a host gives businesses the uninterrupted, speedy Internet access they want without a heavy investment.
Dedicated Hosting
One of the highest levels of control over your hosting power is called dedicated hosting. With dedicated hosting, your company leases a private server (often called a "box") from a hosting company. Websites that use dedicated hosting do not share their resources (or troubles) with neighboring websites since their computer server is physically separate. This is an ideal arrangement for high-demand websites that require large storage space and transfer speeds for multiple databases or for sites that run memory-hogging applications (such as streaming media). Bandwidth, storage space and the CPU may occasionally be hogged by other sites on a shared server but these problems are not an issue with a dedicated server—it's like having your own private toy box instead of being required to share.
Dedicated hosting is offered with varying degrees of service and management. A plan with no management of your system by host provider is called co-located hosting—essentially you are just storing your locked server equipment at the host's secure location. The only way to exercise more control over your server options would be to set up and operate your own in-house server—an expensive undertaking. But you don't need to invest in dedicated hosting unless you require precise control over your host situation and you can't afford even a moment of downtime.
The disadvantages of a dedicated hosting environment include less support and higher cost than other environments—from a few hundred US dollars to several thousand per month. You'll need to know what you are doing and have the money to do it with a dedicated server. You'll need to select and then maintain your own computer server, operating system and software or pay someone to do this for you. If you don't require this much control over your hosting, consider a hosting environment that offers more support and fewer decisions.
Virtual Hosting
Most companies—and all startups—don't need all the power (and expense) that dedicated hosting requires. That's where virtual hosting and shared hosting come in. With virtual hosting, you share a computer with other websites but the computer is configured to perform as if your website is the only site—like a mini-computer operating within a computer. With virtual hosting you have most of the advantages of dedicated hosting, but without all of the expense. Your site will have more limits for storage and data transfer since you are sharing those assets with other websites, but you'll typically receive more services from your host provider. You'll only need a FTP (File Transfer Protocol) to upload and edit your files on the virtual host computer using a control panel tool. This arrangement is well-suited to small and medium-sized businesses.
Shared Hosting
The last hosting environment is the most commonly used—shared hosting. Shared hosting is just as it sounds—all the individual websites share resources on a given server. But even though the server is shared, individual sites are quite secure. Most host companies that offer shared serving boast about and even guarantee their security, backup, storage space and speed so that your service feels like dedicated hosting without the hassles.
The vast majority of websites you visit daily are hosted on shared servers. Why? Because shared hosting is both economical and easy for website owners to manage. In fact, most websites will never even come close to reaching the generous storage quota offered with the most basic shared hosting plans.
When you select shared hosting the host service handles the day-to-day hardware, software and security needs for your server's maintenance. Website owners need little or no technical expertise to manage a website on the shared server—just an Internet connection and a password gets website owners into the host's control panel to manage their sites.
Because shared hosting is the least expensive, least demanding web hosting option, most website owners have chosen to stick with this method instead of paying extra for a virtual or dedicated server.