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Cloud Computing vs Dedicated Server

Should you host your next application in the cloud or should you continue to host your application on dedicated servers?

If you were itching to put your next application in the cloud, you may want to hold off on that move. In some cases it makes sense to start your application in the cloud, but in most cases it doesn’t. In the past, reliability was a big concern with hosting in the cloud. Your instance could disappear at any time without notice. There were no up-time guarantees or solid SLA’s. Most of these concerns are melting away as the cloud computing industry starts to mature.

If looking strictly at price points, cloud computing may seem just a little more cost effective than renting a dedicated server. But it’s not an apples-to-apples comparison. For cloud servers, you are paying for the resources that your virtualized instance uses. With a dedicated server, you pay the same amount regardless how much that server is used.

Don’t fall for the cloud computing marketing hype of “pay for only what you use”. Who in their right mind is only going to let their servers run from 9am to 9pm to save costs? What they really mean is if your application needs to scale, create a few more virtualized instances to handle the load. When the load subsides, you can destroy those instances since you no longer need those resources. If you had experienced high loads with a dedicated server, you would have to quickly have your vendor provision new hardware. That process could take anywhere from 2-24 hours. That doesn’t include the time you would spend getting the server ready for production.

Most virtualized cloud instances are un-managed, meaning it’s your responsibility fore the care and feeding of your instance. Dedicated servers come in managed and un-managed flavors. A managed dedicated server is usually more expensive than an un-managed server. So if your computer administration skills are on the week side, you’d probably want to go with a managed dedicated server. There are a few companies, such as Enki, offer managed cloud computing services.

There are also other companies (Rackspace, GoGrid) that offer a hybrid strategy of dedicated servers combined with a cloud to handle spikes in traffic or temporary large computing projects.

I’ve managed dedicated servers now for many years with many different vendors. Each experience has been different from the next. From 99% reliability to outright fraud. My experiences with cloud computing have been favorable. But don’t expect much hand holding.

As far as cost, again – it depends on the type of application you want to host. If you just want to host a blog, you will probably be better off with getting a virtual private server (VPS) than a dedicated server or putting your application in the cloud.

If you find yourself transcoding thousands of videos, running a social network, need your content distributed globally, hosting a Facebook application, or have some other unpredictable high-volume application, then the cloud is the place for you.

If you know what your bandwidth requirements will be month-to-month and you can plan your growth, then it will probably be more cost effective to stick with dedicated servers.

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  1. March 25th, 2009 at 22:30 | #1

    Thanks. I was really confused to choose between cloud hosting and dedicated server. It is really helpful article and helped me to understand the concept.

  2. August 12th, 2009 at 17:18 | #2

    Thanks Erik, great article.

    There is a lot of confusion around the cloud with public, private and hybrid flavors and most have seen much success with the likes of salesforce.com and amazon.com etc.

    For a business looking for value and reliability, I would personally stay with dedicated servers. I did a quick comparison. I could get a computer in the cloud for around $0.90c per hour. Approx $21 a day. Sounds cheap. Over a month that is $630.

    Now, on the flipside for instance, we offer on our virtual server platform a server (1vcpu, 2gb RAM and 40GB disk) for approx $250 per month. For Windows a MS SPLA license adds about $20. Hosted on tier 1 hardware, high available data centre facility, server cluster, SAN, VSS Snapshots, redundant internet etc. etc.

    That is a big difference in price. Maybe I am old fashioned but I prefer knowing where my server is housed.

    I have concerns about security, accountability, compliance and regulations surrounding server infrastructure such as PCI DSS. How well are these enforced in the cloud? I know some cloud providers state this but what measurement and stop/checks are used? Up time and support contacts is another area to consider.

    I think different applications/companies need different platform depending on their specified requirement, where some applications are suited to the cloud some are just more suited to a dedicated server environment.

    James Righetti

  3. August 12th, 2009 at 22:11 | #3

    James,

    Thanks for your great comment. I have production systems in the cloud and I also have dedicated servers.

    I wouldn’t advocate anyone jumping into cloud or utility computing unless they truly understand the strengths and weaknesses of dedicated servers vs servers hosted in the cloud.

    Most people make the mistake at only looking at what an instance will cost them. They fail to calculate the cost of bandwidth, static IP’s, reserved disk space. That $.20c per hour instance quickly rises to an $.60-$0.70 cents per hour instance.

    Thanks again for the great comment.

    -Erik

  4. August 17th, 2009 at 20:21 | #4

    Hi Erik,

    I just chatted to a friend who was seeking some secure dedicated server to offer online training and certification. Instead of his original plans of dedicated servers hosted and an in-house Dev team, he went to the cloud and hired some developers in the Phillipines and he saved 70% on his projected forcast using the cloud!

    I’m going to research some more. Keep up the great articles.

    James

  5. April 21st, 2010 at 18:20 | #5

    Thanks Erik,

    Useful info from someone else who is dithering between cloud or dedicated hosting!

  6. June 23rd, 2010 at 21:04 | #6

    Thanks Erik

    It is really helpful article and helped me to understand the concept.

  1. July 22nd, 2010 at 06:32 | #1

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