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Demystifying Dedicated Servers: When and Why Your Business Needs One

Demystifying Dedicated Servers: When and Why Your Business Needs One

Have cloud servers have all but eliminated the need to spin up a physical server? It’s easy to think so, but there are still some cases where organisations prefer a dedicated server over virtualised resources. It’s all about performance, control, and privacy.

What is a dedicated server?

These often powerful machines are entirely dedicated to one user or organisation, offering complete control and the flexibility required for both hardware and software customization.

Since the remainder of this post highlights the various benefits of dedicated servers, it’s useful to quickly look at a few points that should be kept in mind before choosing a dedicated server:

  • Cost. Dedicated servers can be more expensive than other hosting options like shared hosting or a public cloud server. After all, you’re renting an entire server rather than sharing resources with other users.
  • Technical know-how. Unless you’ve opted for a fully-managed dedicated server, you’ll need to be familiar with server hardware and software configurations as well as security best practices.
  • Hardware. A dedicated server is a standalone unit, which means that any type of hardware failure can impact the entire server and everything running on it. This has to be accounted for and can be offset with redundancies.
  • Scalability. While dedicated servers offer a high level of performance and control, adding more resources isn’t as seamless as with, say, a cloud server. After all, these are physical components that require a powered-down machine to be installed. Unless you have redundancies in place, this means downtime.

Keeping all of these disadvantages in mind, the decision to run a dedicated server should be based on your needs and budget.

Dedicated server use cases

As I’ve mentioned, a dedicated server is particularly suitable for organisations that need performance and privacy. These characteristics make a dedicated server ideal for media streaming services, online gaming platforms, and backup servers.


A dedicated server’s high-performance hardware can usually handle the demands of media streaming. Depending on your host, you may even be able to add in additional hardware, such as a graphical processing unit (GPU) for more encoding options and better stream processing.


Dedicated servers provide the power and low latency needed for a smooth and seamless gaming experience. This translates into faster loading times and lower pings, which are critical for online gaming where even a slight delay or lag can ruin the experience. No more stuttering or dropped connections.


Where a dedicated server is deployed to manage backups, the necessary operations can run without impacting the performance of other services or applications. The server’s high level of reliability and availability ensures that backups are always available when needed. This is particularly important for mission-critical data and applications, where downtime or data loss can have severe consequences.


Full control over the server hardware and software allows organisations to implement strict security measures to meet compliance requirements. But it’s also server location that plays a role – in some ways these physical servers are easier to host in specific geographic locations compared to existing cloud servers. This allows organisations to comply with data sovereignty regulations, and is particularly important for businesses that deal with sensitive data, such as healthcare or financial institutions.

Virtual Private Servers (VPS)

To think of a dedicated server as a single-purpose unit of hardware is somewhat limiting. Virtualisation software can be used to deploy one or more virtual private servers (VPS) on a dedicated server. Setting up a hypervisor such as KVM or VMware on the dedicated server makes it easy to create multiple virtual private servers (VPS) that share the physical resources of the dedicated server – similar to cloud computing. Each VPS operates as an independent server with its own operating system, applications, and users, but all running on the same physical hardware. The goal here is to optimise resource usage, rather than letting the bulk of your CPU, memory, and disk space remain idle.

This approach allows you to consolidate multiple servers onto a single physical server to reduce hardware costs and ultimately justify every penny you spend.

Dedicated server vs private cloud

When discussing dedicated servers it’s important to keep in mind that many of the advantages (and fewer disadvantages) are also available in a cloud configuration. Specifically, a private cloud setup.

Both a dedicated server and private cloud provide organisations with a high level of control over their hosting environment. With a dedicated server, you have complete control over the server hardware and software configurations, while a private cloud delivers dedicated hardware and allows you to customise the cloud environment to meet your specific needs. Any resource upgrades to a private cloud can be done without shutting down the hardware.

Additionally, both dedicated servers and private clouds offer high levels of performance and security. With a dedicated server all hardware resources are dedicated to the performance of your applications. Similarly, with a private cloud you can assign dedicated resources to your cloud servers without worrying about contention with other tenants (as would be the case in a public cloud environment). Both of these can also ensure a secure and private environment for your organisation’s applications and data.

In short, think of a private cloud as a number of dedicated servers with their resources pooled together, which is exactly what it is.

Should you get a dedicated server?

In most cases it’s a misconception to think that dedicated servers are more powerful than cloud servers. However since it’s dedicated hardware, dedicated servers offer more customisation options where hardware virtualisation isn’t feasible. Added privacy means more security, making a dedicated server ideal for organisations with compliance requirements, including those aiming for full PCI DSS certification. If you don’t fall into any of these categories, then it’s really just a question of budget.

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