Table of contents

What is web hosting, really?What is VPS hosting?Comparing the twoWhy people confuseVPS vs shared hostingWhen to hostOther use casesHow to chooseFAQsGetting startedAdditional resources

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VPS hosting vs web hosting: similarities, differences, and how to choose

If you’re researching hosting options, you’ll see a lot of comparisons between “VPS hosting” and “web hosting.” But here’s the catch: those two terms don’t really belong on opposite sides of a chart. One is a service, the other is a server type—and the overlap can be confusing if you’re new to the hosting world.

Let’s break down what each one means, how they’re different, and how to choose the right setup for your site.

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What is web hosting, really?

Web hosting is simply the act of putting a website online and making it accessible to visitors. You’re renting server space, bandwidth, and resources to run your site’s files, database, and code.

The term doesn’t refer to a specific type of hosting plan—it just means you’re hosting a website. That could be done on a shared server, a VPS, a dedicated server, or even cloud containers.

So when people ask, “Is VPS better than web hosting?” what they really mean is “Should I host my website on a VPS, or use a more basic hosting plan?”

What is VPS hosting?

VPS stands for Virtual Private Server. It’s a type of hosting environment that uses virtualization to split a single physical server into multiple private servers, each with its own resources.

You can host just about anything on a VPS:

Websites (WordPress, custom stacks, ecommerce platforms)
Web applications
Game servers
Databases
Development environments
Internal tools and business apps

So while VPS can be used for web hosting, it’s not limited to that role.

Comparing the two: purpose vs platform

The most important distinction is this:

Web hosting is a purpose. VPS hosting is a platform.

You can host a website without using a VPS. You can run a VPS without hosting a website. But if your goal is to put a website online and your tool is a VPS, then those two terms overlap.

Here’s how they compare:

Feature	Web Hosting	VPS Hosting
What it means	Hosting a website online	Hosting on a virtual private server
Purpose	Website availability	Infrastructure control and performance
Includes	Shared, VPS, cloud, or dedicated plans	May or may not be used for web hosting
Flexibility	Depends on the plan	Highly flexible and customizable
Use case	All website types	Websites, plus apps, tools, servers, databases

Why people confuse web hosting with shared hosting

The confusion comes from how providers label their services. Many offer “web hosting” plans that are actually shared hosting—multiple websites sharing the same server with no resource isolation. It’s affordable, beginner-friendly, and usually advertised as “web hosting” without specifying the type.

So over time, “web hosting” has come to mean “shared hosting” in casual use—even though technically, that’s just one flavor of hosting a website.

VPS vs shared hosting: how they stack up

If you’re trying to choose between a basic shared plan and a VPS, here’s how they compare.

Resource allocation

Shared: Your site shares CPU, RAM, and storage with dozens (or hundreds) of others.
VPS: You get an isolated slice of server resources that no one else can touch.

Customization

Shared: No root access and limited server-level controls.
VPS: Full root access means you can install custom software, configure firewalls, and fine-tune performance.

Performance and speed

Shared: Your speed may suffer if other users spike their traffic or use too many resources.
VPS: Isolated environments deliver more stable and predictable performance.

Security

Shared: Risks from other users on the same server can affect your site.
VPS: Your environment is separated, so issues in neighboring accounts won’t impact yours.

Cost

Shared: Starts as low as a few dollars per month.
VPS: Costs more, but gives you more power, control, and long-term value.

Feature	Shared Hosting	VPS Hosting
Resource Allocation	All websites on the server share the same pool of CPU, RAM, and storage.	Each VPS has its own dedicated resources, isolated from others.
Performance	Can fluctuate depending on what other users are doing.	More stable and reliable, since resources aren’t shared.
Customization	No root access; limited to default software and settings.	Full root access with the ability to install custom software and tweak configurations.
Security	Greater risk due to shared environment—one compromised site can affect others.	Isolated environment reduces cross-account vulnerabilities.
Scalability	Limited—requires migrating to a different plan once you hit resource limits.	Easily scalable by upgrading your VPS resource allocation.
Cost	Very affordable; great for basic websites and small projects.	Higher cost, but offers better value for high-performance needs.
Ease of Use	Beginner-friendly, especially on managed plans.	Slight learning curve, unless you opt for a managed VPS.
Ideal For	New websites, personal blogs, small business sites with low traffic.	Growing sites, ecommerce stores, web apps, or anyone needing more power and control.

When to host your website on a VPS

VPS hosting is a smart move when your website needs more than what shared hosting can offer. Consider upgrading if:

You’re seeing traffic growth or performance slowdowns.
You run ecommerce, forums, or other dynamic content.
You need a custom server stack or app.
You want better security and isolation.
You’re managing multiple projects or domains.

Other use cases for VPS hosting (beyond websites)

Not every VPS is used for websites. Here are just a few other ways people use virtual private servers:

Game servers for multiplayer worlds: A VPS gives you the dedicated CPU and memory needed to host popular multiplayer games like Minecraft, Palworld, or 7 Days to Die without performance drops from other users.
Private databases or self-hosted analytics: You can use a VPS to host MySQL, PostgreSQL, or NoSQL databases in a secure environment that you control, ideal for internal analytics, business intelligence, or customer data applications.
Email servers with full control and privacy: Running an email server like Mail-in-a-Box or Postfix on a VPS lets you manage your own email system, maintain full privacy, and avoid the limitations of third-party email providers.
Staging environments for software teams: Developers often use VPS instances to spin up test environments, preview app changes, or run containerized stacks like Docker—separate from their production workflows.
VPN or proxy services for business or personal use: You can deploy a secure VPN like WireGuard or OpenVPN on a VPS to encrypt traffic, protect privacy, or securely access internal systems from remote locations.
CRM platforms like Odoo or ERPNext: If your business needs a self-hosted CRM or ERP system, a VPS gives you the dedicated environment and root access needed to install and manage complex software stacks.

A VPS gives you a lot of freedom. If you need to run something online, and you want control without the cost of a dedicated server, a VPS is often the answer.

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How to choose: web hosting options vs VPS hosting

If you’re looking to host a website, these questions can help you decide which path to take:

Your Priority	Start with…	Upgrade to…
Lowest cost	Shared hosting	VPS
Performance	VPS hosting	VPS with NVMe or cloud VPS
Customization	VPS hosting	Dedicated server
Simplicity	Shared hosting	Managed VPS
Multi-site projects	VPS hosting	VPS or cloud container
Hosting other tools too	VPS hosting	VPS or dedicated server

FAQs about VPS hosting vs web hosting

VPS hosting is better for control, speed, and flexibility. But if you’re just starting out or have a very small site, shared web hosting may be all you need for now.

It costs more than shared hosting.
If unmanaged, it requires more technical know-how.
You’re responsible for software and security updates unless it’s a managed plan

VPS hosting is better for control, speed, and flexibility. But if you’re just starting out or have a very small site, shared web hosting may be all you need for now.

You should use VPS hosting when:

You need dedicated resources.
You want root-level control.
You’re running more than just a website.
Your traffic or application demands are growing fast.
You need business-class security for HIPAA or PCI compliance.

Next steps for choosing between VPS hosting and web hosting

If you’re building a website, “web hosting” is what you’re shopping for—but that doesn’t mean shared hosting is your only option. VPS hosting gives you more control, better speed, and the flexibility to run your site and any other apps or tools you need.

When you’re ready to upgrade your hosting to a high-quality VPS, Liquid Web can help. We’ve been leading the industry for decades, because our VPS servers are fast, cloud-based for easy scalability, and unbeatably reliable. Choose your favorite OS and the management tier that works best for you.

Click below to explore VPS hosting options or start a chat with one of our experts right now to learn more.