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That's easy. First of all I don't own my server server I just rent it. However you can put your own hardware into an ISP and that is called a co-lo (for co-location).
When you have a dedicated server only YOUR stuff is on it. All hosted accounts are just that... they HOST anywhere from 25 to 400 different domains. So IF your domain is on a server with a porn site or a news site that gets heavy traffic, response back to your views is going to be slow.
There are also ten tons of security issues with shared hosting... but that only matters if you are going to have a database with confidential stuff on it.
There are 'flavors' of dedicated servers. The two main ones are 'managed" and 'full root.' Managed servers are usually more expensive. You do NOT have full privileges. The data center staff manage your sever for you... they monitor it, and they upgrade the software and do the security updates etc. You pay for that. Pair Networks only has managed servers which is why they are expensive.
Other data centers offer "root servers" where you not only rent a machine but YOU do all the 'stuff'... load the software you need, keep it running, etc. It is cheaper.
I'm experienced enough to run a root server... but I'm 'rich enough" not to have to! The guys and gals at Pair look out for my server (which is one of about 2,000... my best guess) one hell of a lot better than I could... or want to. With Pair you get a free hardware upgrade every 2 years. I just went through one... pain in the a$$ but the Pair folks fixed the few problems I had quickly... downtime was about 2 hours total.
Most of you probably have no use for a dedicated server. I run a web service called Jaya123 and so I need to have a locked-down machine constantly monitored. Pair is the "best" at this in my experience.
One nice thing is that IF you have your own server you don't have to have the top of the line if it is not high volume. I run on a Celeron... and it runs just fine. Now if I had 10,000 hits a second it would melt... but Jaya does fine with this simple hardware. Anyway, with servers its all about RAM... not processor speed.
Anyway, no matter if you want a simple hosted server or a dedicated server, Pair is one company you should put on your list to check out. All their service is in-house (not India) everyone speaks English, and they answer the phone on the 3rd ring. It's owned by one guy who takes pride in his company... and it shows.
And by the way... if you are thinking a server is a big beast... it's not. Have you ever seen a bakery rack? Well a server is like that... about as tall as a refrigerator ... and has slots for "pizza boxes" which is about the size of a server. It 'shares" power and bandwidth with all the other "pizza boxes" in the rack. I think most racks have room for about 25 servers... but don't quote me on that.
Al
Thanks so much Al for your input. Will be looking into pair.
One more question.
How can I make my site more securable if I'm using shared hosting. I hear websites are being by broken into by hackers into their box.
I guess the mistake is having web files writable by the web server..