Moving beyond Shared Hosting

You worked hard building your website, and it has paid off! The amount of activity on your site has far exceeded your expectations, and as a result, you need to look for more advanced hosting options.

These days, you have a lot of options including Virtual Private Servers (VPS), Dedicated Servers and Server Colocation.

If you're confused about which option to choose, this post should hopefully clear some of that up.

Why Do I Need To Upgrade If I'm Not Using All My Bandwidth Or Disk Quota?

This is a question people commonly ask. One day they get an email from their web hosting company telling them they need to upgrade their account to a dedicated server. So they go look at their stats and see their not using anywhere near their allocated bandwidth or disk space.

The reason for this is, you're not really allocated any actual bandwidth or disk space. Many web hosting companies offer more than they can deliver. Some companies even offer "unlimited" bandwidth and disk space, but there are obviously hardware limits. They do this because they know that most of their clients will only use a tiny fraction of the server resources.

If you have a shared account, you're probably sharing the server with hundreds of other users. I remember one account I had a client on where there around 800 other accounts on the server. Their smallest package offered 1000GB of transfer. The server seemed to only have one network card connected. Even if it was a 1GB network card, the maximum bandwidth available would be 220,000 GB. Divide that by 800 and you only can assign 275GB per customer. Not to mention a 1,000MBs Internet connection would cost them around $25k.

So obviously, if web hosts had to actually deliver what they marketed, they wouldn't be in business very long.

But bandwidth and disk space isn't the limit most people hit. If your shared hosting plan promised you 1,000GB of bandwidth, you'd probably have to get somewhere around 2-3 million visitors a month. Not everyone is going to be able to manage that, no matter how hard they try.

An inefficient application on the other hand, can use a significant amount of memory and CPU, even with a handful of users. If you read the fine print when you sign up for a hosting account, you'll see that they make provisions to disable accounts if they exceed resource levels. Some hosts will try and shuffle accounts around servers to accommodate their clients, but they have their limits.

Even if you're not using all your bandwidth, you may want to upgrade your account if you feel having a dedicated CPU and memory, or other hardware enhancements might benefit your site.

Should I Choose a VPS, Dedicated Server, Managed Server, or Colocation?

So you decided you need to expand your hosting package. But which solution is right for you?
To answer that, lets look at what it takes to put a website online:
Secure, conditioned space
Servers can be expensive and more importantly you want your server someplace where people can't mess with it. No pulling out plugs or drives to see what happens. Servers also generate a lot of heat and work better in a cool environment.
Servers need electricity to run. Ideally, you want your server to be on a power set up that has backup battery power for short outages, diesel backup generators for extended power outages in addition to a connection to the power company. Even better, that whole system should be redundant, 2 power connections, 2 sets of generators, 2 battery backup systems.
Network connection
If you want your server to be accessible by people outside the server room, you need to have a connection to the Internet. Because you want your connection to be up all the time, you want the data center to have multiple connections to different ISPs and their infrastructure configured to failover properly in case one goes down.
No matter what you're running, you need a computer to run it.
Operating System
Your need a base to install all your other software and to manage your hardware. That's what an Operating System basically does. You can choose Windows, Linux or Unix (Solaris).
Other server software
On top of the OS, you'll need software services to put your website on. A web server, a database server, an application server, email, etc.

VPS Hosting

VPS stands for Virtual Private Server. It is the next step above shared hosting. Your web hosting company will manage everything that it takes to get a server connected to the internet in their data center, and sell a portion of that server.

In these cases, you are sharing a server, but with far fewer people. From your perspective, it looks like you're getting your own server. You have a set amount of disk space (usually on a RAID array), a set amount of memory and sometimes a set amount of CPU power. In some cases, you use more CPU resources if they are available. For example, you're VPS is on a dual processor system and you are guaranteed 1/8th the CPU capacity. If you're running something CPU intensive, and there is available CPU that nobody else is using, you can use more than your allocated share.

With a VPS, you can have a choice of what operating system to run. It doesn't matter what OS the host server is running. You get full control over almost every aspect of the operating system, as if you had your own server. You do need to know how to manage your operating system and other server software. Some hosting companies will manage that for you as well for additional fees.

Dedicated Server

With a dedicated server, you are renting a server and everything that goes along with it to get it connected to the internet in a data center. Your hosting company is responsible for keeping your server hardware running and that your power and internet connection are up. They will install the base operating system, which may include some common server software, but after that you're on your own.

There are many packages available for dedicated hosting from single CPU Celeron Processors up to Dual Quad-Core systems.

You can have more than one server with any provider and in most cases, they will be able to set up a Virtual Private Network (VPN) for all your servers, so that you can communicate with them securely on the local network, and not have to use up your bandwidth allocation.

Managed Server

A managed server is similar to a dedicated server, but it also includes other Managed Services, to help those that can not, or do not want to maintain their own servers. Typical managed services include patching operating systems and server software so it's up to date, monitoring hardware health, replace failed drives, managing firewall settings and things of that nature. Different providers have different types (and quality) of service.

Prices can vary greatly, and unfortunately, price is not always a good indicator of quality. In general, managed servers are more expensive than dedicated servers, but that difference in price may be worth it if you don't know how to maintain your own system, or you would rather focus on building your applications or selling your services.

Just like with dedicated hosting, most providers can set up a VPN if you have multiple servers.


With colocation, your provider will give you space in their data center, and a connection to their network. You need to provide the physical server, and everything that goes on top of it such as the operating system and other server software.

If something fails on your server, such as a hard drive, it's up to you to go and change it. Many data centers will give you hands on support options for an hourly fee. If you want to upgrade the CPUs, you can ship the CPUs to them, you power off your server, and they'll do physical work of replacing the CPU. Some will even offer support for certain operating systems and other hardware.

You can get colocation packages for as little as one server or as much as a cage full of racks. If you have multiple servers, most colocation providers can set up a VLAN (virtual local area network) so that you can communicate with your other servers privately. At some point, if you have many servers, you will want to look into getting your own networking equipment such as a switch and firewall.

With colocation, you pay for space, power and networking. You can put in a single Celeron server or a 4-way Quad Core Opteron Server and pay roughly the same. I say roughly because if you have a lot of CPUs, drives and memory you will need more electrical power and may need to pay extra. With a dedicated server, you'd be paying hundreds of dollars more.
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Ricardo said...

Thanks for the detailed info - I came here from garagedc.blogspot because I was searching for data center information and this post certainly cleared up some "colocation" questions I had. Thanks!

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