When shopping for web hosting services for your small business, you have multiple options. Two of the most commonly offered web hosting technologies are shared hosting and dedicated hosting. While they’re both readily available from most hosting companies, they’re very different technologies and come at very different prices.

Learn more about what shared and dedicated hosting are so you can decide which one you should choose.

Key takeaways: 

  • Shared hosting is one of the most popular types of web hosting available today and is ideal for smaller sites that don’t get a huge amount of traffic.
  • Dedicated servers provide you with full control over advanced web servers so you can configure them in whatever way you want.
  • It’s important to not only choose the right type of web hosting but also the right web hosting services company to work with.


website template illustration
Source: HostGator

What Is Shared Hosting?

Shared hosting is one of the most popular and affordable types of web hosting available. When hosting with this technology, the hosting company sets up a powerful web server and uses software to create multiple different accounts, one for each customer who is using that server. Each customer has exclusive access to the files and information on their account so that it’s all secure.

A single web server can have dozens or hundreds of separate accounts on it. Each account can be used by customers to host one or more websites. All of the websites share the system resources on the web server. This allows the hosting company to offer great hosting to each customer while keeping their prices very reasonable. This is why shared hosting is the most commonly used option for smaller websites that don’t get a huge amount of traffic.

What Are the Advantages of Shared Hosting?

Shared hosting has helped to make it economical for small websites to exist for decades now. The fact that individuals and businesses can have access to a great web hosting server for a few dollars per month for a basic package puts the ability to run a good website within reach of everyone. There are many great reasons why shared hosting is the ideal option for many situations, including:

  • Affordability: Shared hosting is almost always going to be the cheapest option out there. Despite its low price, however, the services provided are still typically very good.
  • Easy to use: The hosting company can have your web environment set up automatically as soon as you purchase the service. This means you can start building your website in just minutes.
  • Efficient use of technology: Having a large number of websites running on one server is a very efficient way to use the server’s resources. Since each website gets visitors at different times, the server can handle all the requests easily.

What Are the Disadvantages of Shared Hosting?

While shared hosting is a great option for many situations, it isn’t always going to be the best option. There are some disadvantages to shared hosting, especially when compared to a dedicated server. Review the following downsides to shared hosting to make sure you’re aware of them:

  • Performance impacted by other sites: Since all the sites on the server are sharing the resources, what happens to one website can impact the performance of the others. If a site on the same server as yours experiences a huge spike in traffic, for example, it could cause your site to load more slowly or even crash.
  • Growth limitations: If your site gets too large or has too much traffic, the shared server can no longer support it. At this point, the hosting company likely requires that you upgrade to a good virtual private service (VPS) hosting package or even a dedicated server. Fortunately, a site has to get quite large or busy before this becomes an issue.
  • Quality concerns: You need to make sure you’re choosing a top-rated hosting company when using shared hosting. There are a large number of discount hosting providers that cut corners, resulting in a poor-quality hosting experience.

What Is Dedicated Hosting?

Dedicated hosting is when a single customer is given full access to and control over a single web server. All of the system resources on that server are used exclusively for one customer. While this type of hosting is most commonly used for larger websites or sites that get a lot of traffic, that isn’t always the case. Some people with smaller sites choose a basic dedicated hosting package because they like being able to have full control over the server.

What Are the Advantages of Dedicated Hosting?

If you want to be the only customer using your server, dedicated hosting is the way to go. There are many great advantages to using a dedicated server, including these:

  • Full control: Since you’re the only customer using a server, you can have full control over every aspect of it. You can choose the operating system, the software installed, and much more.
  • Exclusive access to resources: You won’t be sharing the system resources with any other customers. This means you don’t need to worry about your site slowing down due to the actions of another website. It’s also great for planning for your future needs.
  • Plenty of price points: While dedicated servers almost always are more expensive than shared hosting, there’s a huge range of price points. If you don’t need a powerful server, you can often find hosting companies that offer older hardware at a very affordable price. On the higher end of things, you can spend hundreds or thousands of dollars per month to get premium dedicated hosting.

What Are the Disadvantages of Dedicated Hosting?

Of course, there are going to be some disadvantages of dedicated hosting that you should be aware of. The following are some of the biggest reasons why small businesses generally don’t go with dedicated hosting:

  • Cost: Dedicated servers are usually a lot more expensive than shared hosting. Even a basic entry-level dedicated server usually is $50 or more per month, compared to just a few dollars per month for an entry-level shared hosting account.
  • Points of failure: If you’re running your website on one dedicated server, a hardware failure can quickly take you offline. While hardware failures are rare, they’re something to be aware of.
  • Complicated: If you want full control of the web server you’re using, you need to know how to manage the environment. This means you need to have someone who has experience with running a web server. You can also pay for managed dedicated hosting from your web hosting provider, but that typically costs extra.

How To Choose the Best Type of Hosting for Your Business

Both shared hosting and dedicated hosting are great options to consider. Taking the time to figure out which one is going to be best for your business doesn’t have to be too difficult. Since shared and dedicated servers are so different in their features, most small businesses have no trouble deciding which one to use.

If you want a very affordable hosting option and don’t mind giving up a little control over the hosting environment, shared hosting is the obvious choice. If your business needs to have full control over the web server, and you don’t mind paying extra for it, then dedicated servers make more sense.

If you still aren’t sure, it may help you to know that the vast majority of small businesses don’t use a dedicated server for their hosting. Shared hosting is the most common option, and a VPS is the second most commonly used type of hosting for small businesses.

Top 3 Shared Hosting Services

If you have decided that you want to use shared hosting for your website, your next step is going to be to decide which hosting company to work with. At Digital.com, we’re evaluating all the different hosting companies out there constantly to make sure we know which ones are best. You can read our evaluation of the best hosting providers, which is updated regularly, to get a full list, or check out three of the top-rated shared hosting companies here:

  • Bluehost
  • SiteGround
  • WP Engine

Top 3 Dedicated Hosting Services

If you want full control of your web server and have decided to go with a dedicated server, find out which hosting companies offer the best options for this type of hosting. Read through our evaluation of all the top dedicated server hosting companies or go with one of the top three listed here:

  • Liquid Web
  • InMotion Hosting
  • HostGator
man sitting using a laptop
Source: Liquid Web

What Should You Do Next?

Once you have decided what type of hosting you want to use for your website, the next step is to choose a hosting company. One of the ones listed above for each type of hosting undoubtedly provides you with an excellent overall experience.

After signing up for a hosting account, you just need to create your website and get it published so everyone can use it. This whole process is faster and easier than most people would expect, so get started today.