Why hosting on your own servers is better than hosting on cloud, Or?

Well, how are you?

Things have changed recently since many cloud providers coming into place. Though it has done a little harm.

The attraction of a dedicated physical server is the absolute control it gives you, while with a virtual server it’s the low price. Which should you choose? It all depends on your priorities. First we’ll consider these options in isolation, then compare them, and finally, we’ll show who usually chooses which type of hosting.

Dedicated Server

Dedicated hosting is a kind of hosting in which you use a separate physical machine. As the owner, you can change the configuration of the computer, install any operating system or software you like, and more. Dedicated servers are usually used by large companies and high-load projects with increased security and control requirements, as well as state institutions who need certified hardware.

The main disadvantage of a physical server is its price, which, as we will show below, is several thousand dollars even for the cheapest option. Another disadvantage is that you need to service a physical server independently, repair it if it becomes faulty, and make sure the hardware is still up to date, since it can quickly become obsolete.

VPS (VDS)

A Virtual Private Server, also called a Virtual Dedicated Server, is basically your own server as well — just virtual. You have a dedicated RAM, processor, and disk and don’t share resources with other users. You have full control over your server, just as if it were physically located on your premises.

This solution costs a few dozen dollars a month and does not require large initial investments of capital. Small companies often use virtual servers for site hosting, software development and testing, and hosting content management systems.

The configuration of the server can be quickly altered to suit changing business tasks. The provider (unless they are a budget provider) constantly invests in hardware, ensuring that it remains up to date. Furthermore, your company doesn’t have an expensive non-core asset on its books, with the periodic investments in repairs and adjustments this would involve. This is all taken care of by the provider.

Cloud Hosting

Rather than acquire servers, some companies (especially smaller ones) often opt instead for cloud services, such as cloud hosting, cloud computing and so on. One one hand, it’s convenient, since the customer receives a turnkey service. On the other hand, the customer has no control over their server: in cloud hosting, physical servers are united in a cluster, and the operator distributes content across several servers and hard disks.

Here’s a comparison of each of the options mentioned:

Dedicated physical server

VDS/VPS

Cloud hosting

Advantages

- Controllability

- Safety

- Controllability

- Safety

- Low price

- Safety

- Low price

Disadvantages

- High purchase price

- Requires servicing

- Regular rental fee

- Regular rental fee

- No control over server

The Experience of Others

We carried out a survey, the results of which we can now share with DZone readers. The survey was conducted among Russian users, who were divided into the following groups:

• By project load: fewer than 100 users a day, from 100 to 1,000, and over 1,000;
• By company size: fewer than 100, from 100–1,000, and over 1,000, and a spearate option “for own use,” in cases when there is no company (i.e. the service is being used for private needs)

Question 1: What kind of hosting do you use?

Possible answers:

• a dedicated physical server,
• a virtual server (VPS)
• or cloud hosting (the most cost-effective type of hosting, in which websites belonging to different clients are hosted on one web server).

What’s interesting is that 40 percent of those polled responded “I don’t know.” And among small companies and low-load projects, the proportion of those who don’t know exceeds 50 percent. In medium and large companies, this figure falls to 20 percent.

Answers given to the question “What kind of hosting do you use?” by those familiar with different hosting types. This graph shows the distribution of the answers:

By project load:

By company size:

Conclusions

• The more demanding the project and the bigger the company, the rarer they use cloud hosting;
• As companies grow in size, so does the proportion of those who prefer a physical server (this can be explained by the increased security and control requirements for their IT resources, as well as economy: as load increases, eventually you reach a point at which it’s cheaper to buy hardware of your own than pay a high rental fee to a provider).
• The greatest interest in physical servers was shown by medium-load projects (50%), who are also the least interested in a VPS (10%);
• High-load projects use both physical and virtual servers in equal proportions (40%).

Question 2: What had an influence on your choice of hosting?

The answers were distributed as follows according to priority:

VPS

Physical server

Cloud hosting

1

Functionality

Safety

Reliability

2

Safety

Reliability

Safety

3

Reliability

Functionality

Cost

4

Tech support

Cost

Functionality

5

Productivity

Tech support

Productivity

6

Cost

Productivity

Scalability

7

Scalability

Scalability

Tech support

From the answers, we can conclude that:

• Safety and reliability are always in the top three priority parameters.
• Price plays a meaningful role only when choosing cloud hosting. With VPS it’s one of the low-priority choice parameters, but with a dedicated server it’s close to being a top-three priority.
• Scalability is the least important choice parameter for VPS and dedicated physical servers, and this is to be expected — this type of hosting is the least flexible from this point of view.
• The low priority given to scalability for cloud hosting came as a surprise. While it’s rated higher than for the two other hosting types, we could have expected a higher position than next to last. This means that one of the key advantages of cloud hosting turns out in practice to be in relatively low demand. Flexible scaling is important where explosive or unpredictable load growth is possible, but it appears that there are not enough such projects to substantially change the general picture of requirements. Most projects have some kind of idea of how their load is likely to change in the future — and whether it will change at all.
• Tech support almost made it into the three top choice parameters for VPS, but was not considered a concern for cloud hosting.

Ask the Experts

We prepared another set of questions for specialists.

Question 3: What system virtualization is used on your virtual server? This chart shows the distribution of the answers:

VMware is the undisputed leader, Hyper-V and Xen take second and third place, while KVM is the least popular.

Question 4: What additional services do you use when working with virtual servers?

Here are the top three:

1. Antivirus programs.

2. DNS hosting.

3. DDoS protection.

Question 5: What programs and applications do you use on a virtual server?

Again, the top three:

1. Docker.

2. MySQL.

3. Kubernetes.

On Pricing

What influences the price? Primarily it’s the processor, the drive type (a quicker SSD is more expensive than an HDD), and the amount of RAM. Sometimes the country in which the data center is “registered” is a factor, and sometimes the OS affects the price (with Windows, as a rule, it’s pricier).

In the case of VPS, you have the convenient option of making use of the free test period and seeing whether cheaper hardware will cope with your loads — for example, if an HDD isn’t running slowly, there’s no point paying for a more expensive SSD). This helps to choose a configuration that is optimal for price and productivity.

Let’s compare the prices of physical servers and the services of various providers:

Name /
Location

Dedicated physical server

VPS

Cloud

SUPERMICRO SUPERSERVER 1029P-WTRT

(UK)

$5,771

(Dual Intel Xeon 2.2GHz, 32GB RAM, SSD 128GB + Windows)

HPE ProLiant DL120 Gen9 (Switz)

$4,381

(Intel Xeon E5–2630 v4, 16GB RAM, SSD 128GB + Windows)

NIX sS9000

(Russia)

$4,151

(2 x Xeon E5–2620V4/ 64 GB/ 2 x 2 Tb SATA RAID + Windows)

ArtMotion
(Switz)

$95 per month

(2vCPU, 4GB RAM 100GB + Windows)

Amazon Lightsail

(USA)

$40 per month

(2vCPU, 4GB RAM 100GB + Windows)

RUVDS
(UK, Switzerland, Russia)

$33 per month

(2vCPU, 4GB RAM 80GB + Windows)

DigitalOcean

(USA)

$20 per month

(2vCPU 4GB RAM 80GB, no Windows)

Google Cloud

$136,95 per month

(2CPU, 4GB RAM, SSD 375GB)

Microsoft Azure

$31,81 per month + $100 per 10,000 transactions
(2CPU, 4GB RAM, 16 GB temporary storage + 64GB SSD)

Conclusion

The best way to make the right decision on whether to buy a server or rent a VPS is as follows:

• Estimate the cost of monthly rental of a VPS, based on your current requirements and the loads you anticipate in the next few years.
• Work out the cost of renting a VPS for 2–3 years.
• Compare this cost with the price of a dedicated physical server, adding the cost of servicing.

If the cost of renting a VPS turns out to be higher than the cost of a server, then it’s worth thinking about buying hardware of your own. However, our practice shows that in more than 80 percent of cases the cost of a server is equivalent to 10–20 years of rent, which makes the purchase of a physical server completely pointless. This is why virtual servers are so popular among small and medium businesses, which have modest loads and limited financial opportunities.

If you have a small company and you need a simple service like site hosting, then it makes sense to use cloud hosting, which avoids the need to pay rent or buy a server.