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I was just wondering why the cloud servers are cheaper as compared to the dedicated servers.

Are the cloud servers shared? If the cloud provider commits a 1.7GB RAM (aws ec2 m1.small), are there chances that 1.7 GB will not be allotted?

When I compare a aws ec2 default server (1.7GB Ram, 1 ECU) with hostgator cheapest offering, I find the difference quite a bit.

Where is it generally suggested to host a website? Dedicated or Cloud?

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closed as off-topic by Ƭᴇcʜιᴇ007, random Jul 8 '13 at 11:34

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Why is it cheaper to buy one computer to run N tasks simultaneously using a multitasking operating system, than N computers to run one task each using a single-tasking operating system? Pretty much the same principle: economics of scale. –  Michael Kjörling Jul 8 '13 at 9:31
    
Why are cars more expensive than houses? Answer: depends on the car, and depends on the house. And btw, typically dedicated servers are cheaper than the equivalent hardware running 24/7 in the cloud, not the other way around. –  TTT Jul 8 '13 at 13:22

2 Answers 2

You're comparing apples with pears. A dedicated server is a dedicated server, it's all yours and it has definite limits on it's capacity. A cloud based host is a cloud based host, and they are almost certainly using virtualization to a large extent, which does not only mean power savings and less physical hardware, but also that the actual hardware available is utilized much more efficiently. Every gigabyte of storage and every gigahertz of processor that is available (not currently used) can be transferred seamlessly to another customer. In this scenario, you are not paying for the physical server, you are paying for the performance.

It all comes down to renting the "metal", or renting the capacity. If you are renting the capacity but you have no demands on where the metal is located, you will likely get it cheaper, although there's always exceptions.

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Cloud Server is cost effective because payment method in term of Pay as you go model. Cloud Server is Scalable. If you go for other server they are constant at single server. If any case server goes down, slow so your product will go down and slow. But in Cloud there are many servers which are easily transfer load to other server by the help of load balancer. It is also help to access your product as fast as they can by link your user to nearest region server.

Some more resources are here: cloud servers are cheaper as compared to the dedicated servers

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