Hosting variants in comparison

Dedicated or Cloud? The decision is often not easy for shop operators, as both hosting models have their strengths and deficits. With dedicated hosting, users have full access to one or more servers. In recent years, however, cloud computing has become a major competitor for this option. Cloud computing is often praised for its flexibility and cost efficiency.

In this post, we compare dedicated hosting and cloud computing based on their similarities and differences, as well as their respective advantages and disadvantages.

Hosting definition

In the field of web hosting, the two variants dedicated hosting and cloud computing (colloquially also called cloud hosting) have established themselves over the last few years. Both approaches are based on the provision of IT infrastructures and services. In the following, we define the two terms and go into the similarities and differences.

What is Dedicated Hosting?

With dedicated hosting, storage space and computing power are provided on one or more dedicated servers.

Dedicated hosting includes direct and comprehensive access to one or more servers. As a rule, this variant includes root rights for the respective server. This means that extensive changes can be made to the server and operating system settings. Applications, services and individual scripts can also be installed.

In this scenario, however, users are usually also responsible for installing updates and regularly maintaining installed tools and software. Those who opt for dedicated hosting must therefore have the appropriate know-how to maintain the server and the applications running on it.

Many providers also offer dedicated hosting in connection with so-called managed services. Depending on the scope of services, the provider in such a scenario takes over the maintenance of the server and offers a range of security measures.

What is Cloud Computing?

The term cloud computing is often also referred to as cloud hosting. However, cloud hosting is actually only a subset of cloud computing. Cloud hosting describes the provision of virtual machines (VMs for short), with the help of which applications and data can be hosted in the cloud. Via a hypervisor, the available computing resources are made independent of the physical hardware and made available for the use of the virtual machine.

Cloud computing goes beyond this definition, because in addition to the provision of virtualised servers, the term also includes other functions of the cloud as well as various service models. A distinction is made between the following services:

• IaaS (Infrastructure as a Service): The provider makes virtualised IT infrastructure consisting of storage, network and servers available to customers. In this scenario, customers maintain the data, applications, middleware and operating system running on it themselves. In most cases, they have full access to the virtualised infrastructure via a dashboard. This variant is most comparable to dedicated hosting.
• PaaS (Platform as a Service): The PaaS model is suitable for users who want to focus completely on the development and execution of applications. In addition to the provision of a virtualised server infrastructure, customers receive access to a software framework with which web applications can be developed and operated on the infrastructure. In this case, the provider is responsible for managing the infrastructure. Thus, the PaaS variant is similar to classic managed hosting.
• SaaS (Software as a Service): In this scenario, customers only have access to the software itself. The virtualised hardware environment underneath, on the other hand, cannot be accessed at all. With a SaaS solution, users can concentrate completely on running the software; maintenance and support of software and hardware are the responsibility of the provider. This solution is particularly suitable for professionals whose business model requires only minimal adjustments to the software and who do not have the resources to manage and maintain the software themselves.

Since the users' data and applications are located on the provider's distributed cloud servers, they only need internet access to access them from anywhere.

What are the differences?

At first glance, the differences between dedicated hosting and cloud computing do not seem very great. In both cases, providers make a powerful IT infrastructure available to their customers. Various web applications can then be developed and operated on this infrastructure. Initially, there are hardly any differences in which operating system, which services or applications can run on it. Administrative access also takes place in both cases via a user interface.

The most obvious difference is that dedicated hosting gives access to one or more dedicated servers. Their locations can be clearly localised, for example in a data centre. With cloud computing, on the other hand, the migrated data is distributed across several virtualised servers. These also have a physical counterpart, but the location of the hardware is not decisive.

With regard to aspects such as security, scalability and costs, there are also some unique selling points of both hosting models.

Dedicated Hosting and Cloud Computing in Comparison

In the following, we will take a look at the factors of scalability and performance, security and data control in order to be able to compare the two hosting variants even better.

Scalability and performance

Especially for traders in e-commerce, the topics of scalability and performance are the basis for success in online trading. The faster the loading time of the online shop, the better the user experience and the ranking within the search engine results.

It is equally important to be able to scale the hardware resources as flexibly as possible if necessary. This is necessary, for example, if the number of visitors to the shop increases significantly due to promotion days or TV commercials. Also, if the product catalogue of the online shop grows or the shop is migrated to a new shop system, the hardware requirements can change significantly.

How fast and scalable is cloud computing?

Cloud computing is generally regarded as the more flexible alternative to dedicated hosting. Because the data belonging to the web application is distributed across a network of virtualised servers, the necessary hardware resources can be flexibly adjusted. If more performance is required, scaling can take place directly and without delay. As a rule, cloud users can manage their hardware themselves like software and add computing resources such as storage space or RAM as needed.

Maintenance of the hardware, virtualisation software and operating system is usually carried out by the cloud provider. The customers, on the other hand, can configure and manage the software applications and services installed on the hardware themselves.

In terms of performance, cloud computing is dependent on network performance. Since access is via the internet, system performance can be affected if the internet connection is unstable. Also, cloud servers are limited in terms of processor speed and cloud node types. These depend on how many cores are available on the physical hosts.

How fast and scalable is dedicated hosting?

Dedicated hosting is a dedicated server infrastructure that is provided and maintained by the provider. The performance is essentially dependent on the performance of the hardware provided, but can also be improved through the use of supporting services. Therefore, when choosing a hosting provider, attention should be paid not only to the quality of the hardware, but also to the presence of a software stack with powerful tools.

The advantage of a dedicated infrastructure is that users have sole access to the server and thus the full power of the hardware is available.

Network performance also plays a role in terms of performance. Many providers rely on a high-performance connection that enables high data transmission speeds.

In terms of scalability, dedicated hosting is not very flexible. Although a server offers sufficient capacity even for larger websites and online shops, a sharp increase in traffic and growing demands can lead to increased resource requirements. In such a case, renting additional servers is an option. However, this is cost-intensive and cannot be implemented in the shortest possible time. Conversely, resources cannot be reduced if the workload does not require the full performance of the server.

Security and availability

In e-commerce, a lot of sensitive data is transferred for business reasons. This includes names, delivery addresses, bank details and more. Therefore, the security of the online shop is of great importance to traders and customers. It forms the basis for a trusting business relationship.

The security of an online shop goes hand in hand with its availability. If a shop is not accessible for customers, this not only results in a loss of sales, but also a loss of reputation.

Security and availability in dedicated hosting

The factors of security and availability in dedicated hosting depend on whether it is a pure bare metal offer or whether the provider also offers managed services. The former means that the hoster is only responsible for the provision and maintenance of the physical server. The trader has to take care of the maintenance of the installed services and applications himself. This brings with it great freedom, but also complete responsibility for the security and availability of the running applications. This requires appropriate know-how.

The situation is different if the provider offers managed services in addition to providing the hardware. In this scenario, the provider ensures that the servers and the services running on them are up to date and optimally protected. This starts with the security concept of the data centre. In addition, regular updates are carried out so that the server services and the operating system are always up to date. In this scenario, the trader is only responsible for maintaining the installed software.

An firewall, DDoS protection and DSGVO compliance are among the basic requirements for secure online shop operations. In addition, the provider ensures that backups of the databases are created regularly so that there is no loss of data in the event of an emergency.

The availability of dedicated hosting is defined by the provider's SLAs. Here, care should be taken to ensure that the provider guarantees the lowest possible downtime. A fallback solution such as the failover system from maxcluster, for example, ensures that a 1:1 redundant system immediately takes over in the event of hardware faults or defects so that the shop remains accessible. If the contractually guaranteed availability is not met, the provider is obliged to pay compensation. The amount is also defined in the provider's SLAs.

Security and availability in cloud computing

In theory, 100% availability is possible in cloud computing because data is stored independently of the physical hardware due to the virtual machines. If a physical server fails, the virtual server can be transferred to another physical storage medium without any downtime during operation. Achieving 100 % availability is nevertheless rather unrealistic, as the failure of network components can also affect a large number or services are disrupted by software errors.

Many cloud providers ensure extensive protection by implementing a cloud security strategy. Indications of the implementation of a valid security strategy are, for example, the TÜV Cloud test mark or the certificate according to the international standard ISO/IEC 27001.

With regard to data protection, it is important to check where the cloud provider's servers are located. For example, if the data is stored on servers abroad or if the provider's headquarters is located abroad, it is subject to the jurisdiction of the respective country. For customers, it is not always comprehensible where their data is stored. Exceptions apply in the case of transparent communication by the provider. For businesses from Europe, it is therefore important to check in advance whether the respective provider can guarantee GDPR-compliant conditions for operation in the cloud.

The Competence Network Trusted Cloud initiated by the BSI lists a number of cloud providers who transparently communicate their server location and the applicable law.

Control and data sovereignty

An important differentiator between dedicated hosting and cloud computing is control and data sovereignty.

Control and data sovereignty with dedicated hosting

The great advantage of dedicated hosting is that users have sole control over their dedicated server(s) and the data running on them. As a rule, they even have full root rights. This also means that there is complete freedom of choice with regard to the installation and configuration of the operating system, web server and other programmes and services.

Control and data sovereignty in cloud computing

In cloud computing, users often do not have full access rights to the physical server. The exception to this is the IaaS model, where users can be given root rights to the virtual server. The virtualised environment, which can be accessed via an interface, is already pre-configured in the PaaS or SaaS model and cannot be set up completely freely. This means that the cloud provider offers a fixed set of tools and services that users can work with when setting up their environment. This includes, for example, a web server, operating system, DBMS and other tools. In the SaaS model, users usually cannot make any changes to the configuration.

As mentioned earlier, data sovereignty is not always guaranteed in cloud computing. Depending on the country in which the provider's servers are located, the jurisdiction of the corresponding country also applies. This can result in foreign security authorities being legitimised to access the data in the cloud. For traders from Germany, it is therefore advisable to choose a provider with data centres in Germany or Europe. The provider's headquarters should also ideally be located in the named area.

When choosing a provider, also pay attention to how the handling of sensitive data is contractually regulated. The basis for this is a legally compliant ADV contract. If the facts are not clearly defined in the contract, there is a risk that customer and business data will be analysed and resold. In the worst case, this can result in compliance violations.

If data is migrated to a SaaS solution, a move to another hosting model cannot be easily managed afterwards. Therefore, before moving to a SaaS cloud model, it should be checked whether the data can still be migrated to another system in a compatible form. Also, the design inherent in the SaaS software is usually not exportable. If relevant factors relating to migration and repatriation have not been clarified in advance, a dependency relationship with the provider can arise.

Costs

The costs for cloud computing or dedicated hosting vary greatly from provider to provider. Influencing factors are, for example, the scope of service and support, the availability guaranteed according to the SLA, the quality of the hardware components and more.

Cloud computing is generally considered the more cost-effective hosting option. With many cloud providers, the costs for the required resources are based on actual consumption (keyword pay-as-you-use) and, depending on the provider, are billed by the second or by the hour. Smaller companies in e-commerce in particular benefit from the fact that there are usually no set-up fees for cloud solutions. However, the cost development is often non-transparent. If the hosting requirements increase, the costs can rise quickly and unexpectedly. The choice of cloud model (IaaS, PaaS, SaaS) also has an impact on costs, as the scope of services varies greatly.

With dedicated hosting, the costs can vary greatly. The purchase or rental of a server is usually a much larger cost than with cloud computing, as an entire server is rented. Depending on the type and scope of managed services, there are usually additional costs for maintenance, support and guaranteed availability. This model has the advantage that costs incurred are more calculable. The billing cycles vary from daily to monthly.

Managed E-Commerce Hosting at maxcluster

maxcluster's Managed E-Commerce Hosting is geared towards the stable and secure operation of online shops and complex web applications. For this reason, our hosting solution includes the operation of scalable, fail-safe and high-performance Managed Web Clusters. With this setup, we pursue the goal of combining the factors of security and control with the factors of flexibility and cost efficiency.

As is also common in cloud computing, we provide our customers with a virtualised hardware environment. This ensures that hardware resources can be configured according to individual requirements. If resource consumption increases or decreases, the hardware can be scaled flexibly and quickly by our service team.

Server services and security settings on the cluster can be managed and monitored via the management interface, the Application Center. The integrated e-commerce stack contains numerous tools and services that can be configured individually or based on our best practices to optimise the performance and security of installed web applications. The operation and maintenance of the clusters and services is carried out by our service team.

The hardware used is located in a Tier III+ data center in Frankfurt am Main, in the immediate vicinity of the DE-CIX Internet node. This means that web applications hosted by maxcluster are easily accessible throughout Europe and in the USA. To protect the entire network from DDoS attacks, we use Voxility.

If you have any questions about our managed e-commerce hosting, please feel free to contact our technical support team by phone at +49 5251 5151 350 or by email at beratung@maxcluster.de.

Conclusion

Depending on the quality of the hardware, dedicated hosting offers good performance and full control and data sovereignty on the dedicated server. However, there is also the fact that a lot of internal know-how and resources are needed for administration and maintenance. Smaller applications in particular often require only a fraction of the capacity of an entire server. However, if the requirements suddenly increase, a server can quickly reach its limits. This makes dedicated hosting significantly less flexible than cloud computing. In most cases, the costs are higher than with cloud computing, but they are also easier to calculate.

Cloud computing, on the other hand, impresses with its scalability and flexibility, but offers fewer options than dedicated hosting in terms of access to the physical server. While entry costs are low and consumption can be billed in real time with many providers, costs can rise unexpectedly for more complex requirements. Control over data is also not guaranteed in all cases. When selecting a provider, it is important to consider in which country the servers are located and whether DSGVO-compliant hosting is included in the SLAs.

It is therefore important to weigh up which hosting solution best meets one's own requirements.

Published on 12.07.2023 | DR, JH