What is VPS hosting?

VPS hosting definition

To make a website available online, its files need to be uploaded to a web server, which is typically purchased from a hosting provider. This service is known as web hosting.

VPS hosting is a type of hosting suited for people who have outgrown shared hosting. Where multiple sites reside on a single web server with shared hosting, and have no guarantee of resources, VPS allows fewer users to share allocated segments of hard drive space, memory, and processor power.

Each user on a VPS server has access to a virtual machine running its own copy of an operating system (OS). This allows customers using VPS hosting to experience similar capabilities and performance to a dedicated server for their sites.

Most website owners start out using shared web hosting. In time, as their site grows and demands more resources and functions, they may need a more powerful hosting option. A virtual private server (VPS) is generally considered as the stepping stone between shared hosting and a dedicated hosting setup in which your website runs on its own server.

Let’s break hosting types down using a simple analogy. Shared hosting is like living in an apartment; it’s cheap and can come furnished with everything you need to move in. The tradeoff is sharing facilities with many other people (sharing resources with the other accounts on the same server), and if you throw a massive party (have lots of traffic), building management will want to talk to you.

A dedicated server is like having your own house with acres of land around it. All resources in the house are for your sole use and you won’t be bothered by your neighbors, even if you do throw a party (experience high traffic).

VPS lies somewhere in the middle. It behaves like dedicated server but with an allocated system resources. Let’s equate VPS to a townhouse, it's bigger than an apartment (shared hosting) but you shared the property and certain services. What’s more, throwing a party (having lots of web visitors) is easier.

Hosting isn’t the easiest topic to get your head round, but the foundations of what you need to know can be understood fairly quickly. If you’re looking to get VPS hosting and understand it’s alternatives but feel somewhat discouraged, stick with us. Whether you’re just getting started with a blogging site, or an individual site that’s started to slow down on your current hosting plan, VPS hosting might be the perfect fit. Let’s find out...

VPS vs Shared Hosting - What’s the difference?

Before we move on to VPS, let’s talk about shared hosting. Most site owners get started with a shared hosting plan. As a business or website grows it demands extra functions and more resources. Site owners look to upgrade to a more suitable hosting plan. VPS is the next logical hosting to look to when making the transition from shared hosting, but what is shared hosting exactly?

Recommended reading: What is shared hosting? →

Back to our housing analogy. We likened shared hosting to living in an apartment complex where the same location and resources are shared among the residents. With shared hosting, several residents (websites) share the resources of one building (a single physical server). This type of hosting is really affordable. Skilled professionals manage the shared hosting environment, a control panel is available for customers to manage their site. The main issue with this style of hosting is the available bandwidth and room that’s included. It’s more than enough for most new websites, but eventually websites will need something that scales as they grow. Another significant drawback to shared hosting is that this environment can’t handle traffic spikes very well.

VPS hosting answers the problems of scalability and limited resources. This style of hosting is like owning a condo within a building that has fewer residents. A VPS is divided into numerous virtual cubicles within a server, and every account will get quantities of these allocated sources (a fraction of the server’s CPU, disk space, memory, and bandwidth for example) plus full root access. You still share the server (building) with other people, but you now have more control over your space, using it as you see fit.

For example, when you own a condo, you may install a new door or a hang artwork on the walls without much trouble. If you want to knock through a wall or add a new bathroom, you are within your rights to do that. Unlike apartment living (shared hosting), with VPS, you may make fundamental changes to the virtual machine such as changing the operating system.

VPS is a more powerful set up than shared hosting. The neat thing about VPS is that it emulates a dedicated hosting environment but with allocated system resources divided between individual sites. The next alternative is the most expensive option; a dedicated server where all of a server’s resources are dedicated to a single user (owning a home).

How does VPS work?

If you’re familiar with VMware or Virtualbox, you’ll be familiar with how VPS hosting works. These programs let you run what are known as virtualized operating systems from one machine. For example, your computer might be running OS X, but you could run different systems such as Linux or Windows XP without having to reconfigure or restart your computer.

VPS web hosting environments work in the same way as a virtualized operating system in the sense that one server will run numerous, one of a kind virtualized OS’s on a single server -since each virtualized system behaves as though it is a dedicated server. Virtualization is possible through a hypervisor. A hypervisor is computer hardware, software or firmware that creates and runs virtual machines (VM) by separating the underlying physical hardware from a computer’s operating system and applications. The computer system on which the hypervisor runs is known as a host machine, and each VM is called a guest machine.

The hypervisor provides each guest machine (each website using the VPS) with a virtual operating system and takes care of managing and executing guest operating systems. This process makes the most effective use of computer resources such as network bandwidth, memory space and processor cycles. For this reason, a hypervisor also goes by the name of a virtual machine monitor (VMM).

VPS hosting relies on a hypervisor to take resources from the physical server and provide each website with access to an emulated server (the VM). These physical servers are often held in a data centre and divided equally between several virtual compartments (known as server virtualization). Each compartment is rented out, and server software is setup on them separately so that each unit is capable of functioning as an independent unit. Each individual VPS is called a container, and the server each container is held within is known as a node.

With VPS, you benefit from many of the advantages of a dedicated server for a significantly lower cost. It offers more privileges within the OS and allows users to install any type of software capable of running on that OS. Each virtual server’s software is installed separately, enabling independent functionality for all users.

Defined amounts of CPU time and memory are shared throughout all the accounts sharing the server space. So, despite the fact that there might be far bigger websites than yours on another VPS compartment powered by the same server, that doesn’t matter. You are guaranteed the system resources you are paying for.

VPS is a step up for most users, but you'll also benefit by knowing a bit more about the technology. When your website is stored on a VPS, you are solely responsible for setting up, maintaining and running the server yourself. Handling an internet server is not an easy task! It involves taking care of security patches, server configuration, software updates, and so on. Unless you have the degree of technical skills required, it is going to tricky, and for this reason, there are two versions of VPS hosting – managed VPS and unmanaged VPS.

There are different types of VPS Hosting

Unmanaged VPS

With unmanaged VPS, your web hosting takes over installing the operating system, and you as the site owner take over managing various aspects of the server such as:

  • Installing software, your control panel and taking care of software updates.

  • Monitoring for security threats, installing security patches and fixing error messages.

  • In the event of an outage or hardware failure you won’t get much if any support from your host.

  • Configuring and maintaining your server including any upgrades you might want to see.

  • You take over the responsibility of setting up your sites backup services.

This is recommended for site owners who have a technical background.

Managed VPS

Site owners with less technical acumen or a smaller staff can benefit from managed VPS. With managed VPS hosting, IT professionals lighten your load by keeping your server running correctly and taking care of your virtual server. Here’s what you should expect from a web hosting provider:

  • Initial server setup

    When you launch your site with a VPS there are a few steps to take in order to set the server up including installing your control panel, server software and installing any applications and your operating system. A managed host will take care of this.

  • Updates

    Similarly, all applications and OS updates, and ongoing fine tuning of the server will be handled for you.

  • Security patches

    Security patches for your OS and core server software are installed and updated, on your behalf.

  • Monitoring

    Monitors for early warning signs of hardware failure and malicious attack

  • Automated backups

    In the event anything goes wrong with your site, you can retrieve it back to an earlier version.

Check with your VPS hosting provider to see what levels of management they offer. Some have greater flexibility, like Namecheap; we offer Self-Managed, Managed, Fully Managed and Emergency Assistance.

The tradeoffs between managed and unmanaged hosting are cost vs flexibility. While unmanaged services are naturally, far cheaper than managed plans, there’s a snag - you need to have the tech know-how to run and maintain a server, or be prepared to hire someone to keep it running smoothly and safe from potential attacks.

What are the benefits of VPS Hosting?

The main merits of VPS servers is that they give you the freedom of having your own virtual machine just like you would from a more expensive, dedicated server with performance that can allow you to handle moderate traffic with the occasional heavy spike.


Since you have your own OS, with a VPS, you can customize it to your needs. For example, if you have your own instances of server applications from PHP, to MySQL, Apache, you can customize them so that the server fits your needs.


Offers the ability to oversee a hosting environment. Also, if you plan to install applications that need you to perform a system restart to finalise the installation, you can do this without affecting anyone else, at any time. Even though you share a VPS server with others, yours can be restarted without disrupting others.


More affordable than a dedicated server.

Dedicated resources

With a VPS Server, you have a predefined amount of RAM available to you whenever you need it. In contrast to shared web hosting, where there could be others sharing your server that could eat up the RAM when you want it most!


Another great thing about VPS is that you can purchase the resources you think you will need, and if that’s insufficient, you can simply increase its size.

Do I need VPS hosting?

There are use cases for every type of hosting, so who exactly is VPS hosting for? You should consider VPS hosting if:

  • Your business is expanding beyond the constraints of shared hosting.

  • You are expecting a substantial increase in site traffic within the next few months. For example, your site is geared toward a new marketing effort or promotional campaign, or if you’re expanding into other markets.

  • You might have enough bandwidth to handle a single website, but two, three? If you plan on hosting several websites in the near future you’re going to need more resources. Similarly, if your current shared hosting account is eating through the resources and your host is asking you to consider upgrading, it’s time to consider VPS.

  • Your website needs better privacy and performance compared to what’s available with shared hosting.

  • You want full control over the server, things like custom configurations, root access and installations unavailable with shared hosting.


VPS style hosting is the best way to keep up the success of any site going through rapid growth and expansion. It’s the next best plan that can afford some form of scalability. With VPS, not only will you enjoy a tremendous amount of storage and bandwidth (that’s entirely yours), it’s a cost effective solution to meeting the demands of a busy site. Of course we’ve mentioned dedicated hosting, which for most will be a vast amount of resources you may not need, and you’ll pay significantly more for it.

When deciding between the type of VPS, consider how hands on you want to be, or whether you are able to employ someone else to do the heavy lifting for you. If you like the sound of running your own server, go for unmanaged VPS, if on the other hand you’d like some help with server maintenance, automated backups and software updates, opt for the managed version. When it comes to choosing a VPS host.

Namecheap has the most optimized VPS hosting plans, we provide three types of VPS management: self-managed, managed (which includes root access) where we provide assistance with the additional configuration of core services to meet the specific requirements of each site. We can also help to optimize the server performance. We offer constant monitoring of all services on the server to prevent any of them from being down, and the ability to take immediate actions to resolve the issue in the case sudden downtime occurs. Our fully managed service plans (when root access is granted to Namecheap) includes all the features of the managed option including extras such as priority support and weekly backups.

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