What are the differences between VPS and dedicated servers?

VPSs and dedicated servers both offer dedicated resources with independent servers for individual requirements. VPS involves sharing the host server’s power with others, while dedicated hosting offers a full-fledged physical server with computing power exclusively reserved for you.

Having a server of your own offers many advantages for private individuals. For companies with large online projects, it’s practically non-negotiable. Both shared hosting and dedicated hosting are usually sufficient for bloggers and individuals who run smaller websites or manage small online stores. The requirements are different for busy online stores, gaming servers with a lot of traffic, and companies or individuals with an extensive online presence. In addition to dedicated servers, there are also VPS and cloud hosting solutions available. Let’s take a closer look at the differences between VPS and dedicated servers.

VPS vs. Dedicated servers

Both hosting models provide an independent server environment with a lot of flexibility. They also do not require a costly data centre or high-maintenance servers as is the case with an on-premises model. Unlike cloud hosting, however, VPS and dedicated hosting require server administration knowledge. You can opt for a managed hosting package though, which takes care of the server settings for you.

Below we’ve provided a list of the key differences and features of VPS and dedicated servers:

Difference 1: provisioning

In both hosting models, resources are provided by external companies. However, one of the biggest differences is how they are provided.

In the case of a virtual private server (VPS), or a VDS (virtual dedicated server), a provider uses virtualisation technology to segment a physical server into independent virtual partitions. Although customers share a physical host server, the resulting virtual servers operate as closed systems with their own IP and individual configuration. A hypervisor is used to manage and distribute the server’s capacities. The disadvantage of a VPS is its limited performance and the fact that you have to share resources with others. While VPS is based on hardware abstraction, a dedicated server is a full-fledged, physical server. You do not have to share physical memory, performance or other hardware components with other users. Even if you have a large project with high workloads, you’ll have access to the server’s full capacity.

Difference 2: scaling & performance

Scalability is one of the most important factors to consider when choosing a hosting package. This is especially important if the amount of resources required is uncertain. Although VPS and dedicated servers cannot compete with the scalability offered by cloud hosting, VPS does offer flexibility. Depending on the dedicated server package you choose, you’ll be able to access full computing power right from the start. The strong performance and computing power offered by dedicated servers is sufficient for large and complex tasks. However, if additional resources are needed, additional dedicated servers, which can be expensive, are required.

VPS hosting therefore comes out on top for companies who need scalability that is flexible and affordable. Compared to expensive dedicated hosting options, VPS hosting offers a more cost-effective starting point for smaller projects. Although VPS scaling doesn’t compare with cloud hosting, a VPS package can be flexibly adjusted to accommodate a fluctuating workload.

Difference 3: data security

Data security is offered by both forms of hosting. However, there is one main difference: virtual servers store your data on the host server with other customers’ data. Although VPS servers act independently of each other, data security ultimately depends on the underlying data centre security. A dedicated server uses a single-tenant server environment, so you don’t have to worry about possible security breaches in VPS segments or on the host server.

Nevertheless, there are a number of ways you can mitigate security gaps in both variants. You can configure the server’s security standards using security software, SSL, access restrictions, blocklisting, optimal password protection and data backups. VPS hosting or dedicated server providers usually also have built-in security features as well as additional security features that are optional.

Difference 4: costs

Let’s use a metaphor to compare pricing. VPS is like a rented apartment and dedicated hosting is like a rented house. While you share the main building with other residents in an apartment, it is cheaper than a rented house. Dedicated servers usually offer large resources, so this is also reflected in their higher costs. On the other hand, VPS hosting offers a broad range of price packages. VPS servers offer better value for money for newcomers, smaller companies, or projects with fewer or incalculable requirements.

Difference 5: availability

If you want reliable availability and fault tolerance, you can’t go wrong with dedicated servers. The dedicated resources are, depending on the server package, fully available and do not have to be shared with others. This means that if there is high traffic, all resources can be used without any restrictions. Fast loading times are also guaranteed. In contrast, a VPS hypervisor allocates resources for your server package. Additional capacities can only be used if they are not occupied by other virtual servers.

Similarity: individualisation

Although VPS and dedicated servers both have physical performance limits when it comes to upscaling, they can both be customised. Whether you have your own operating systems, scripts, various programs, or modular microservices, root access allows for an individually configurable server environment with both VPS and dedicated hosting. However, this also means that you need administrative skills to set up and manage your server.

Data protection and data sovereignty

In both hosting variants, you are responsible for managing your server. This means you need to ensure compliancy with data protection legislation for online services and your business’s online presence. You need to protect customer and visitor data as well as your own business’s data. In addition to firewalls, page certificates, and security features, comprehensive data protection and data sovereignty also includes storing data in compliance with the UK GDPR. If you are processing personal data in the UK, make sure to inform yourself of the official data protection requirements.

It is also important to consider the server location for VPS and dedicated servers. In the case of US providers, US authorities have the right to access US owned servers in accordance with the Cloud Act.

Advantages and disadvantages of VPS

Advantages Disadvantages
Independent virtual server at a good price Resources are not highly scalable and are limited to the host server’s capacities
Root access guarantees flexible configuration and individualisation Server management and IT administration knowledge required
Dedicated resources ensure stable performance according to hosting package Host server failures and errors can affect hosted virtual servers
VPS server acts independently and remains unaffected by errors in other VPS segments that are being hosted on the same physical server Additional resources and storage capacity depend on the host server
Simple, affordable setup and consistent prices thanks to fixed fees and various pricing models Suitable for smaller to medium-sized projects with foreseeable performance peaks

A virtual private server offers flexibility with top performance at an affordable price. Try out VPS hosting with the free VPS trial from IONOS.

Advantages and disadvantages of dedicated servers

Advantages Disadvantages
All physical dedicated resources including processor power and memory are available with full-fledged single-tenant server Usually significantly more expensive than VPS hosting
Operating systems, scripts, programs and services allow high flexibility and individualisation Comprehensive server administration knowledge and IT security required
Undivided resources mean reliable performance for high workloads Additional scaling usually only possible with expensive, more complex hardware upgrades or additional physical server capacities

IONOS offers 100 % dedicated hardware resources with leading server technology. Check out dedicated server packages from IONOS and benefit from top performance with a cost plan tailored to your business’s needs.

Is a VPS or dedicated server better suited to business needs?

Depending on the scenario, a virtual or dedicated server may be more suitable. Below are examples for each hosting model:

VPS server

  • Demanding tasks like web hosting with your own web server
  • Processing data with a data server or an email server
  • Managing a small to medium-sized online store
  • Using your own game server for game hosting
  • Cloud storage
  • Test environment for programs
  • Server for office tasks such as scheduling
  • Managing online communities with large, calculable numbers of visitors
  • Medium-sized companies webpages

Dedicated server

  • Complex projects such as web servers with high performance requirements and fast load times with very high traffic
  • Web server for large online stores with a lot of visitors and performance peaks
  • Server for databases
  • VPN services
  • Online presence for medium to very large companies or businesspersons with a lot of page requests
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