You can think of web hosting as being divided into two types: virtual web hosting and dedicated web hosting. Virtual web hosting is often favored by small businesses because of its cost effectiveness. With virtual web hosting, you rent space alongside many other businesses on a server. While it sounds as if all the businesses are jumbled up on one piece of hardware, what is actually the case is that each client in a virtual web hosting environment has its own server resources blocked off from everybody else’s, including processor, memory, and disk space. This works well for businesses that don’t need a lot of disk space or bandwidth to operate their web site. It is also a great choice for clients who want to manage a number of separate web sites at a low cost.

The reason that this type of web hosting is so cost effective is that despite their unique functions, the web hosting requirements are very similar among small businesses. Hosting vendors who can offer nearly identical services to a large number of customers efficiently are able to multiply small profits by large numbers of customers.

Dedicated hosting is an option that midsize and large businesses may consider if they need the control and flexibility of having a server (or servers) dedicated to their website. This type of web hosting is expensive, but allows greater control over security, support, and maintenance. Web hosting vendors who offer dedicated hosting have redundant resources in their data center that can nearly eliminate downtime.

Dedicated hosting often means that your business can write and run custom scripts and applications, or just manage the web site and leave the upkeep of the network and hardware to the hosting company. You can buy a server and host the site yourself, but this is an expensive option and means you have to either know how to manage the hardware, software, and connectivity or you have to hire someone who does. Some businesses already have a dedicated IT staff and data center, and if this is the case, then it probably makes sense to buy and operate another server.

However, for companies without their own IT department and budget, renting a dedicated server from a hosting provider is the most cost effective option. There are many web hosting vendors who offer dedicated server packages. Once you know how much of a hands-on approach you’re willing to take, you can examine the offerings of several hosting vendors and see if their operations complement yours. Some vendors provide tools for creating and managing your site by providing a web based control panel that you can use to tweak your site. Some vendors let you use your own HTML authoring program and upload pages as you make them.

Web hosting vendors know they have to compete for your business, and most try to make your choice easy by offering services that are popular and packaging them together into specific web hosting plans. Most of the plans out there have you pay an upfront set-up fee, and then a monthly fee for your plan and any additional a la carte options (like extra storage or extra email accounts) you purchase.
There are so many web hosting vendors around that it can be overwhelming for a business to choose who they want to host their website. If you know your requirements, or can broadly estimate them, you can almost certainly find a web hosting vendor with a hosting package that is right for you and allows for your site to grow along with your business.

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