A virtual private server (commonly abbreviated to VPS) is created when a physical server is divided into smaller, virtual container. Just like a dedicated server, a virtual private server has its own operating system, dedicated storage, dedicated RAM and CPU resource but it costs much less than a dedicated server.A VPS (Virtual Private Server) is a “software-defined virtualized server” hosted on a physical server, with its own copy of operating system and allocated server resources. This physical server typically runs a virtualization software such as KVM, XEN, OpenVZ, HyperV, etc.
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These virtualization softwares allow you to run several virtualized operating systems on the single physical machine. For example, the main physical server is running CentOS 7, and underlying virtual servers run their own OS like Windows Server 2012 or CentOS 6.X.
Virtualization software has complete control over hardware resources (CPU time, RAM, disk space, etc.) of the physical server. Hence, it can easily create, release, and manage the resources of the each guest virtual machine.
Since each VPS runs its own copy of OS, the user can have root/administrator privileges to that OS instance and can install almost any software that can be run on the OS. Each guest machine is allocated with its share of physical server resources, and based on the virtualization type all VMs are isolated from each other.
VPS Hosting is almost identical to Dedicated Server hosting, but it is priced much lower than the dedicated server.
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