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Grow Your Business Technology

Cloud Hosting vs. Shared Web Hosting: What's the Difference?

web host, business website, performance, analytics, web design
Credit: Maksim Kabakou/Shutterstock

Your business's website is everything – if it's down, your brand and bottom line can be majorly affected. There are several web hosting companies that can provide varying types of hosting for your website. These options vary from virtual private servers (VPS) to standard shared hosting.

One of the major distinctions in these services is between shared and cloud web hosting. Both these services are tiered at a similar level, providing basic web hosting functions, but through completely different processes. While some may argue one is better than the other, the type of hosting that works for your business depends largely on your individual needs.

Holly Rollins, president of digital marketing firm 10x Digital, said there are advantages to both shared and cloud hosting for business owners. 10x Digital also provides web hosting services. Rollins said that, while shared may be more cost-effective, cloud hosting is more secure and easier to scale.  

The right hosting "depends on the type of traffic your website is getting and the type of money you are willing to invest," she said. "Business owners need to decide what's more of a priority. You can always switch or upgrade later if you find out shared hosting doesn't provide the resources or speed you need."

There are some major differences between shared and cloud hosting. Understanding the distinction can help you choose the best service type for your business. [Interested in web hosting services? Check out our best picks on our sister site, Business.com.]

The difference between shared and cloud hosting lies in how each is organized. Shared hosting servers are servers with multiple websites on them. Web hosting companies build and maintain these servers, and they place a bunch of websites on them. This means if your website is hosted on a shared server, it's vying for the same resources as many other websites. Some companies pack a ton of websites onto each server, which can throttle your website's speed and performance. It can also present some limitations in security.

"Once a hacker has access to one website, it leaves other websites on the server vulnerable as well," Rollins said.

Cloud hosting is a service that exists on multiple servers. Instead of on one shared server, your site is hosted in the cloud. This means the company can bounce your website hosting between servers as it adjusts to performance spikes and other stresses. Cloud hosting is more dynamic than shared hosting, and this means it can perform better and be more secure than some shared hosting services.

As always, the short answer to this question is that it depends. The service that works better for your business will hinge on your needs. If you're looking for an inexpensive hosting option that has solid features and can handle your current traffic levels, shared web hosting may be a great option for your business.

"Shared hosting is the traditional method of hosting and can be a good cost-effective option for many smaller businesses," Rollins said. "It also can be easier to use when it comes to features."

Cloud hosting is ideal if you experience high traffic or spikes in visits or if you need in-depth security features. Rollins recommended cloud hosting services for e-commerce businesses and businesses with high traffic demands.

"Because you are not dependent on a single dedicated server, should any issues arise, your site can easily and quickly be migrated to another server," she said. "If you have a very large site with a lot of resources in the back end and are experiencing problems with speed, cloud hosting is a good option."

One thing to consider with cloud hosting is, given its performance and scalability advantages, it is significantly more expensive than shared hosting services. Some shared hosting plans can be purchased for only a few dollars a month, while cloud hosting plans will cost you closer to $15 to $20 per month.

As with any service, you get what you pay for, and Rollins said business owners should consider their priorities before looking into web hosting services.  Cloud hosting services come packed with more security and performance features, while shared hosting services can provide the deal that a small business needs for a basic website.

Matt D'Angelo

Matt D'Angelo is a Staff Writer based in New York City. After graduating from James Madison University with a degree in Journalism, Matt gained experience as a copy editor and writer for newspapers and various online publications. Matt joined the team in 2017 and covers technology for Business.com and Business News Daily. Follow him on Twitter or email him.