One of the biggest decisions for a web master is whether to choose a VPS or dedicated server. With plus points for both, and differing price tags, both bring their own technical benefits as well. Traditionally, dedicated servers were the choice of webmasters, whereas recently virtual servers have risen because of their competitive pricing.
We'll avoid going into deep technical detail, but a traditional virtual server, simply put is a server that is split up into different parts, based on resources alloted. So when you host on a virtual server you are sharing the resources with other people on that dedicated box. This is controlled by a hypervisor that manages the splitting of resources.
If you are looking for the main benefit in choosing a VPS, then it has to be cost. For example, if you currently have a shared website hosting account, but don't want to be on the same services as other web hosting users (who are prone to being hacked and effecting your website), then a virtual server is an affordable option. A server offers further freedom and isolation, but generally they are anywhere from 3-5 times more expensive than a virtual server.
A server does offer you further flexibility. You won't be sharing memory, CPU or bandwidth when you use dedicated servers. Also consider if one VPS is attacked, then it can effect your virtual server.
A dedicated enrivonment is normally more powerful than a VPS. With a VPS you have to share resources. With a dedicated server, the resources are yours and no-one else. On the downside when you run out of resources, you can't blame anyone else!
On the flip side a virtual server is a lot more flexible. You are limited to being able to add extra RAM and another hard disk with a dedicated box. With a VPS, a hypervisor can quickly assign you additional RAM or diskspace with the click of a button. This way you can avoid downtime associated with the trouble of moving dedicated environment.
Most VPS control panels will let you image os installs. You don't tend to find this with dedicated servers. So with virtual servers you can very quickly re-image.
Also consider on dedicated servers, the technology isn't advancing as quickly as on a virtual server. Virtual technology is advancing rapidly. With modern cloud computing, your virtual server is hosted on multiple nodes. And with this you have redundancy that dedicated server simply cannot boast.
However, don't be put off this. When it comes to server hosting, dedicated servers have been around a long time. Hosts such as game server providers still opt for dedicated servers.