Shared vs VPS Hosting

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Choosing the right host is no easy task. Feeling overwhelmed, confused, and a bit lost are perfectly normal reactions when faced with having to decide the right level of service. Even with considerable experience, it can be difficult to choose from among the overwhelming number of options out there.

In this article, we’ll take a look at shared hosting (a natural starting point for small websites) and VPS (Virtual Private Server) hosting — then finish up with a few recommendations for each type of service.

In essence, Virtual Private Servers are a significant step up from general shared hosting plans — with costs ranging from as little as $5/month on the low end to $20–$55 for a decent mid-range VPS service. Is the additional cost justified? Let’s take a look…

Shared Hosting

Shared hosting is a way for hosting companies to put a large number of users on the same server. A server is nothing more than a computer with a processor, memory, and a hard drive — just like your own home computer. If you ever grew up in a household with a single computer used by the whole family, then you’re probably already familiar with some of the upsides and downsides of shared hosting.

On the upside, the cost-per-user is low. If you bought everyone in the family a computer, it would likely cost around $300 per person. If you all use a single computer however, the cost per person could be, between say six of you, as little as $50/person.

On the downside, the resources available to each of you will be limited, and you could be affected by the actions of others. For example, if your brother downloads ten games, he may be using up 80% of the hard drive. What’s more, if one of his downloads contains a virus, it could potentially stop everyone else in the family from being able to use the computer.

Shared hosting is very similar to having a family computer. The server you’re using may be quite powerful, but hosting companies will typically put hundreds (sometimes thousands) of users on it. This is how they keep the costs down to the $4–$8/month level. A powerful dedicated server — where you alone use the server — typically costs upwards of about $350/month. If a company uses the same hardware but puts 300 people on it, they receive over $1200/month — not a bad deal (for them)!

Of course, you shouldn’t really expect a whole lot for such a low cost. If there’s a website with a memory leak on the same server you’re on, you’ll be affected. If a site uses up 80% of the memory, all other websites (which could be thousands) can only access the remaining 20%. What’s more, malicious attacks towards a single website on a server may spread problems throughout the whole user base. This is often referred to as the “bad neighbor” effect. The worst part is that it’s completely unpredictable, which makes it almost impossible to plan for.

VPS Hosting

Compared to a shared hosting service, a VPS (Virtual Private Server) is a technically superior solution in almost every single way. Technically, VPS servers are actually still “shared” environments (in as much as there will still be more than one user running on the same physical machine) but the technology used to assign resources and keep users separate is much more sophisticated.

The key difference is how resources are divided up. Much fewer users use the same hardware and each has their own ‘private’ environment, which makes it seem as though they each have their own server.

With shared hosts, it’s essentially a kind of a free-for-all type of service: whoever grabs the resources first gets to use them. If the server has 16GB of memory, then a single website (out of thousands) could potentially end up using almost all of it. On VPS servers, the amount is divvied up in advance. For example, lower-end VPS plans might allocate 2GB to each user; each of these users would then be able to use as much of that 2GB as they need, but none will be able to overstep their own individual 2GB allowance.

Allocating resources per-user makes for a much more stable and predictable environment. Can you still run out of memory? If you have a poorly coded website, or you go viral and get tens of thousands of visitors overnight, then sure. However, VPS plans almost always allow you to get some additional memory as-and-when you need it (all be it for an added fee of course). The takeaway is that you won’t be adversely affected by what any of those other users/websites on the server do.

Another advantage to this is better security for everyone. There are instances of scripts that can bypass the hypervisor — the process that creates the virtual servers, but these are exceedingly rare.

Should I Switch To VPS?

The simple answer is: Yes. You should almost definitely consider moving away from shared hosting if you’re running a serious online business — although depending on the type of website you’re running, a VPS may not be the only choice worth considering: but we’ll get to that a bit later on. I can think of only two good reasons for when using a shared host might be a better option than using a VPS: one is because of financial considerations, the other is that you’ve got a number of low-traffic websites that you’d like to keep live but aren’t yet of any real significance.

If you’ve just started a company and funds are tight, you might want to choose the $5/month option instead of the $20/month (minimum) option. That said, don’t forget that your website might be the backbone of your money-making efforts. If so, it could be the better choice to spend more on your website and put aside things like getting branded stationery and/or holding catered office lunches.

Another good reason to use shared hosting is if you have some very low-traffic sites you want to keep running but don’t want to “pollute” a VPS account with them. Typically, these sites won’t need any significant power and a little downtime here won’t be a big issue.

In all other cases, I think that a VPS account is a good idea, and I would advise that any serious business switch to it at the earliest opportunity. Perhaps the more relevant issues are how much to spend on a VPS and what the options are once you’ve decided to make the switch.

One question you may have: “What about bandwidth and storage? My shared host allows for unlimited bandwidth and storage, whereas VPS accounts typically impose relatively heavy limits on it.”

Strictly speaking this is true, but you’ll almost certainly never actually find yourself running into storage limits unless you have a very very large website (typically with huge amounts of your own uploaded — not just streamed — video content, for example). Storage space on lower-end VPS accounts is about 40GB, which is A LOT of space.

Do keep in mind, however, that every host that has “unlimited” anything also has a “fair use” policy. This means that you can’t use it as a repository for all your stuff. You can’t get a cheap Bluehost account, for example, and then store 50GB of ripped DVDs there; they will cancel your account as soon as they find out.

The same is roughly true for bandwidth. A low-end VPS typically offers around 1TB of data; let’s see how much this is. The average website size in June 2014 was just over 1600kb. By dividing the allowed bandwidth with this number, we get the rough number of monthly visits 1TB allows for, which is 625,000.

If you have this many visitors on a shared host, you’ll almost certainly be usingway more resources than you should be and your website will be down pretty much all the time. In fact, if you have anywhere near 500,000 visitors a month then you should probably be looking for much higher-end hosting solutions anyhow — and with traffic like that coming to your site, you’ll likely have more than enough money to do so!

Different Types Of VPS

VPS accounts are differentiated based on the amount of resources you’re allotted.

The lowest priced plans (generally about $20/month) usually give you 1 core and about 1GB of memory, 20GB of storage and 500GB of bandwidth — while higher priced plans give you more like 8 cores, 10GB of memory, 150 GB of storage and 1.5 TB of bandwidth. That sort of setup will tend to set you back anything from about $150/month and upwards.

In my experience, if you’ve been getting away with a shared host so far, a $20/month VPS server will probably suit your website/needs. What’s more, should you need to, most VPS hosts will let you scale up on practically a moments notice — simply pay them a little more and they’ll allot your site more resources accordingly.

What Else Is There?

Besides VPS, another very viable solution — if you’re running a WordPress-powered website — would be to opt for “managed WordPress hosting“. Managed WordPress hosting may (technically-speaking) be run on either shared or VPS servers, but because such services are specifically tuned to running only WordPress, they come with a number of significant benefits, one of which is speed!

If you’re looking to choose a hosting solution for a website running only WordPress, be sure to take a look at an earlier article of ours called Shared vs Managed WordPress Hosting, which goes into some considerable depth on the topic.

Recommended VPS Hosts

Nowadays, most hosting companies offer a VPS option. I’ve rounded up some of best below, with a few words on why they’re each worth considering.


SiteGround is a big, well-known company in the hosting world. I’m particularly fond of their support; I’ve had a couple of great experiences with them. They’re also the highest-rated VPS host on social media. This doesn’t necessarily make them a bulletproof choice, but it’s definitely a good start.


WiredTree is another well-rated host offering a ton of services. I personally use their services for a website with 200,000 views a month. It’s hosted on their lowest VPS plan at $49/month and works without a hitch. It just goes to show that visitor counts don’t necessarily have to translate into hundreds of dollars worth of hosting a month.


Linode isn’t a host I’ve used myself, but I keep hearing good things about them. Interestingly, they price by the hour — which is often how large companies calculate these types of costs. The prices are also shown per month; their cheapest plan will only set you back $10/month and is still a huge leap forward in comparison to shared hosting.

Recommended Shared Hosts

As already mentioned, I think switching to a VPS service is a great step for just about any serious company, but what if you’ve got a number of low-traffic sites, or you need a bit more time to gather those all-important funds? In this case, I’d recommend taking a look at either A Small Orange (a particularly highly-rated up-and-coming host with an attractive personal/homegrown feel) or SiteGround(already mentioned in the ‘Prominent VPS Hosts’ section above) — both offer high-quality shared hosting services at more-than-affordable prices, and both will easily be able to upgrade you to a VPS as-and-when it becomes necessary.

A Small Orange offers a shared plan for $2.90/month if you prepay for a year in advance, while SiteGround offers monthly shared hosting plans for just under $5. Choose a well-reviewed large company for shared hosting and you can’t really go wrong; the issues of bad neighbors and the like may occasionally haunt you, but a company with powerful servers and good customer service can — and will — hedge this risk significantly.


VPS is better than shared hosting in every technical way. If you can’t afford $20/month for a good VPS server, I’d even recommend going with a dirt-cheap $5/month VPS from say Vultr instead of staying with a shared host once your website begins to experience shared-hosting-related difficulties. Shared environments are pretty much out of your control, which can be very frustrating.

A good alternative to a general VPS — if you’re running WordPress — is managed WordPress hosting (read more). These are usually a bit more expensive than the baseline VPS services on offer, but can provide a truly significant speed and reliability boost.

If you have any experiences with VPS or shared hosting let us know, we’d be interested to hear your take on which to choose and why!