Building on the concept of “tenancy,” the most common analog to the differences between shared, VPS, and dedicated hosting is the difference between types of housing:

• Shared hosting is analogous to apartment housing, where tenants share services like parking, a laundry room, a swimming pool, etc.
• Dedicated hosting is most similar single-family homeownership, where everything—including the property itself—is owned and dedicated to a single owner.
• VPS hosting is somewhere in between—analogous to townhouse or condo living—where each occupant has more of his or her own services (laundry, parking, etc.)  but still shares a town green, a health club, and other broader, common physical infrastructure.

Shared hosting

Shared hosting is the most basic, most cost-effective form of hosting. In shared hosting, the resources of one physical machine are made available to all tenants in equal proportions. Shared hosting is ideal for basic, personal websites and web apps that have little traffic, few technical requirements and limited performance or security requirements.

In a shared hosting model, because all tenants are allocated a finite amount of an individual server’s capacity, providers do not allow websites to scale beyond the limits of the plan. Nevertheless, shared hosting is the model most susceptible to “noisy neighbors” – tenants whose applications unexpectedly consume more than their share of resources, causing performance problems for other tenants. For more information about shared hosting, see “What is Cloud Hosting?” and “Web Hosting: An Introduction.”

VPS hosting

As already noted, VPS hosting is considered a premium option to shared hosting. In VPS hosting, shared resources are made available to an end user who has greater control over system specifications, guest operating systems, and the overall software stack than is the case in shared hosting.

It’s important to note that while VPS hosting exists between shared and dedicated hosting when it comes to control, price, and simplicity, it is the most scalable of the three models, and is the closest relative of the VMs/virtual servers offered by most public cloud providers.

Dedicated hosting

Unlike shared and VPS hosting, dedicated hosting offers end users access to all the hardware resources of a given server. Dedicated hosting offers the greatest levels of isolation, security, performance, and control in comparison to VPS and shared hosting.

Dedicated hosting is also the most expensive of the three models because of the level of hardware resources allocated to a single customer. It’s also somewhat more cumbersome to scale than VPS because scaling requires the provider to configure and provision new, physical hardware resources.

The term “bare metal servers” is sometimes used interchangeably with dedicated servers, but providers offering bare metal typically offer more cloud-like characteristics in their dedicated servers, such as provisioning in minutes (vs. hours), billing in hourly increments (vs. monthly) and providing higher-end hardware, including graphic processing units (GPUs). See “Dedicated and Bare Metal Servers Explained” for a full exploration into the two options.