VPS vs Dedicated vs Cloud Servers: Which is Right For Your Business?

VPS vs Dedicated vs Cloud Servers: Which is Right For Your Business?

For many business owners, finding the best server hosting solution can be an overwhelming and confusing experience. 

Our team at Cloud Servers Australia has set up and tailored servers for hundreds of businesses in Australia, and know exactly how to translate technical jargon into a language that can be easily understood. 

That’s why, to help you figure out what server solution you may need for your business, we’ve put together a condensed overview comparing two of the most popular types of servers – virtual private server (VPS) and dedicated servers. 

Let’s jump right in. 


VPS – What is a Virtual Private Server?

VPS stands for virtual private server (VPS can also be referred to as ‘private cloud’). With VPS there is one large physical server that’s partitioned into several ‘virtual’ servers. Each ‘virtual’ server can have its own space for resources. 

VPS is like living in a luxury apartment in a building – you have your own space, you’re responsible for maintaining and repairing everything within your space, but ultimately you’re sharing the same building. Things like entry/exits, elevators, etc. are all shared with other residents in your building.

How does VPS work?

With a VPS, you have a separate virtualised environment for your own use, with a set amount of resources such as memory, disk space, bandwidth, CPU and more. These VP’s are usually in a shared environment. 

Benefits and advantages of VPS hosting include:

  • Performance – You have a set amount of allocated resources, and can upgrade/downgrade as you wish to ensure smooth and efficient performance
  • Security – When servers are partitioned, a layer of software is installed to make sure your resources are completely separated and unaffected by other users. 
  • Control – You can have more control over any customisations needed for your hosting environment (depending on your security requirements).
  • Cheaper than dedicated hosting – VPS is best for businesses who don’t need the full-fledged offerings of dedicated hosting but need something more tailored than entry-level shared hosting servers.
  • Scalability – VPS hosting can be adjusted and scaled as your business grows. 

Suitable for:

  • Mid-large sized growing businesses in all types of industries
  • Lower budget than dedicated server requirements 



As the name suggests, dedicated hosting involves having your own physical server solely allocated for your needs – with the amont of resources you are after. 

Dedicated servers are held in data centres that generally share network access with each other, but in terms of hardware, no physical dedicated server is shared amongst more than one client. 

Dedicated servers are often the most expensive option out of the server options, yet they provide a high degree of flexibility and customisation according to your resource needs.

Having a dedicated server is like owning your own house – you can furnish it however you like, park in your driveway, and change your living spaces to suit your taste. But you’re still fully responsible for repairing and maintenance, as well as installing security systems to keep unwanted intruders out. 

Benefits and advantages of dedicated hosting include:

  • Fastest performance – With all the resources you need, you can experience peak levels of high speed performance.
  • Optimal security – Dedicated hosting provides the highest level of security that won’t be affected by other server users or activities.
  • Full access & controls – You have full control over the customisation of your dedicated server including access, resources, security and more.
  • Optional tailored support – Dedicated servers can be quite an investment, but it also often comes with tailored and 24/7 support to make sure your needs and performance goals are being met. 

Suitable for:

  • Large ecommerce sites – especially those that experience spikes in traffic (from limited time campaign promotions etc.) 
  • Public sector where security is a high priority (e.g. government level)
  • Use of custom applications – including custom CRM systems, customer portals, Android/iPhone apps, and more.
  • Web developers


Cloud Server Hosting

‘Cloud servers’ is often mistakenly used as a general term but there are key differences between cloud servers and other hosting types. 

The main difference between cloud hosting and other types of servers is that cloud servers are virtualised environments spread across multiple physical servers – i.e. multiple servers within a data centre to act as one unit. 

Difference between Cloud vs VPS

Cloud and VPS hosting often get confused. The main difference between the two is that VPS servers involve one physical server partitioned virtually into several environments. Cloud on the other hand, involves multiple servers and multiple virtual environments. 

Benefits and advantages of Cloud Hosting:

  • Scalability – You can easily and flexibly customise the amount of resources you need to scale up your business or website performance.
  • Reliable performance – Even if one server goes down, there are other servers that can be used instead, which ensures you experience smooth performance at all times.
  • Pay only for what you need – You can select and pay for only the resources that you need.

 Suitable for:

Cloud hosting is suitable for business who have a little more technical knowledge around how servers work and what their requirements may be. Cloud hosting can be used for most types and sizes of businesses but we highly recommend getting professional IT advice when choosing a tailored cloud hosting plan for your needs.


Key Differences Between VPS vs Dedicated Servers vs Cloud

For a quick summary on the key differences between VPS and Dedicated hosting, see below:

VPS vs Dedicated Server Differences Comparison

Security & Up/DowntimeVPS hosting uses an added layer of software on partitioned servers to ensure one user’s security doesn’t affect the other. Dedicated servers also provide a high level of security like VPS. 

The only caveat is that since dedicated servers operate on a single ‘dedicated’ physical server. Therefor, if the physical server goes down, you may experience some downtime until that gets resolved.

Cloud hosting involves many servers working as one, so if one server goes down, your resources can be drawn from other neighbouring servers – minimising downtime for your business.
ResourcesSince there may be multiple users or ‘partitioned servers’ accessing resources from the same VPS at the same time, accessing your resources may be difficult at times. But generally, resource issues are rare with the right VPS hosting provider.  With Dedicated Servers, you have faster and consistent access to the range of resources that you need. 

This results in a more consistent speed and performance – what you experience today will be what you experience tomorrow.

Multiple servers are involved, therefore resources are spread across multiple servers – making access and resource usage more reliable.
ScalabilityVPS hosting can be scaled up to a certain point – but in the end may hit a ceiling in terms of how far it can grow due to the limit of the physical server.Dedicated servers are the best option for limitless scalability.Cloud servers offer a slightly higher degree of flexibility than VPS and can be customised for a range of businesses, to be able to be increased or decreased as required. 
CustomisationThere is a large degree of customisation with VPS, along with flexibility in downscaling or upgrading your VPS.Dedicated servers allow you to have full control over customising your dedicated server – which means you can customise to whatever your needs and requirements are.Although better than VPS, cloud servers offer less customisation options than dedicated (however is still a good option for minimal to small customisation capabilities)
Technical KnowledgeWith a VPS hosting provider, you’ll have supported assistance and may find it being more manageable than dedicated servers. Dedicated servers require expert or professional-level knowledge simply due to the fact that it can be highly tailored to your needs. This is why most dedicated server plans come with managed support services.Cloud servers don’t require a high degree of technical knowledge, but similarly to dedicated servers, this may not be an issue with a managed cloud server provider.
CostsVPS is a more economical solution compared to dedicated servers. Dedicated servers are known to be the most expensive out of all the server types – and thus are only suitable for large scale businesses and organisations that need the highest level of flexibility and control of their resources.Cloud servers are in the middle between the costs of VPS and dedicated servers. This will vary in terms of what resources and servers you’ll need. 


The Importance of Onshore Data Centres

Regardless of whether you choose a VPS or dedicated server, we highly recommend choosing data centres that are located on-shore and not overseas. 

This assures you with an enhanced level of security as well as faster access to your server (physical proximity and location plays a large part in the speed of your servers). 

In addition, having an onshore data centre ensures your data is managed according to the data sovereignty recommendations within the country. This means that your business’ data is stored, managed, and protected according to laws and regulations within the country. 

Cloud Servers Australia hosts servers on 100% Australian & New Zealand based data centres – to learn more about our data centres or anything else, feel free to get in touch and we’ll be more than happy to answer your questions.


Managed or Unmanaged Hosting? 

Managing your hosting on your own can be quite challenging, time consuming, and costly if you don’t have the technical knowledge and expertise to do so. This is why more and more business owners are opting for managed hosting services. 

Having a managed hosting service means that on top of having your servers and operating systems installed or set up, you’ll also have a professional IT support team handling your server needs such as server management, speed, security, updates, and more. With unmanaged hosting, you simply just get your servers and operating systems (basic level set up), and then the rest is up to you.

Here are the biggest advantages in having managed hosting services:

  1. Managed hosting services free up your time as a business owner  or executive to focus on more important activities.
  2. Many of the important management procedures such as security updates, backups, CDNs and others are all taken care of by IT specialists.
  3. A managed plan means you have fewer maintenance tasks to worry about.
  4. When something goes wrong, you’ll always have a dedicated support team to help your business get up and running in no time. 
  5. Save countless hours and resources from trying to resolve server problems yourself (and instead, have fast and effective solutions provided by your managed hosting service provider).


Need a trusted IT expert’s opinion?

Choosing the right hosting solution for your business needs is absolutely critical to your business’ success. 

At Cloud Servers Australia, we have a team of highly experienced and helpful IT specialists who will be more than happy to discuss what your hosting needs are and what the best solutions will be according to what you’re looking for. 

Cloud Servers Australia is a 100% Australian owned business that centres around providing an excellent customer experience as its core value. We have since become a premium supplier of cloud hosting, virtual servers, dedicated servers, high speed website hosting, co-location, internet services and wholesale services. 

If you’d like to have a chat about your hosting options, then give us a call on 1300 074 267 or send us a message and we’ll be right with you.

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