There are several choices for you to make when it comes to hosting, you will have to decide whether or not you are going to use a virtual environment, a collocated server, a VPS or virtual private server or even a dedicated machine, these may all sound like big words to you but in a matter of a few months to a year you will become very familiar with them. The most popular hosting package that you might have signed up for is the virtual or shared package, this is a great starter deal that you could use in order to test the waters -- so to speak.
If you have a business and starting hosting your website using the most basic plan then it is normal for you to want to upgrade to the next available deal which will expand your resources and bring to you a trouble-free server, this is were the virtual Private server comes in. A VPS is very similar to hold a virtual server and a dedicated server so it can be said that it offers the best of both worlds which is a relatively low price and the benefits found on a dedicated machine.
In order to illustrate how a VPS works will make reference to the way an apartment complex works. Let's imagine that you have an apartment complex which is able to accommodate 15 families within its 15 deluxe rooms, the entire apartment complex is the web server, on a shared environment you wouldn't have separations among the apartments, this means that all of your tenants will be sharing the same resources and space, what a VPS does is that it separates the space and resources available into "apartments" -- by using this structure none of the tenants will be used in the resources or space that their neighbors are using, this system isolates them in a very efficient way, if we applied the very same concept to a hosting environment we can separate the accounts that are placed on a specific server so that they don't use the same space and resources that the others are using, this is very similar to the way he dedicated servers act.
By having your own space, memory and processing power you will effectively have a dedicated account which is not interrupted by the way other people are managing their space and resources in other words, if your neighbor starts to use a lot of RAM or a hard drive space it will not affect your account even though you are hosted in the same machine, a VPS also provides features which are only found in dedicated machines for instance, you can reboot your VPS without affecting the other accounts which are placed on the same server. This is a very useful account which will provide a great transition towards a true dedicated account.