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A virtual private server (VPS) is a virtual machine sold as a service by an Internet hosting service.

A VPS runs its own copy of an operating system, and customers have superuser-level access to that operating system instance, so they can install almost any software that runs on that OS. For many purposes they are functionally equivalent to a dedicated physical server, and being software defined are able to be much more easily created and configured. They are priced much lower than an equivalent physical server, but as they share the underlying physical hardware with other VPSs, performance may be lower, and may depend on the workload of other instances on the same hardware node.

Hosting

Many companies offer virtual private server hosting or virtual dedicated server hosting as an extension for web hosting services. There are several challenges to consider when licensing proprietary software in multi-tenant virtual environments.

With unmanaged or self managed hosting, the customer is left to administer his own server instance.

Unmetered hosting is generally offered with no limit on the amount of data-transferred on a fixed bandwidth line. Usually, unmetered hosting^[2] is offered with 10 Mbit/s, 100 Mbit/s or 1000 Mbit/s (with some as high as 10Gbit/s). This means that the customer is theoretically able to use 3.33~ TB on 10 Mbit/s, 33~ TB on 100 Mbit/s and 333~ TB on a 1000 Mbit/s line per month (although in practice the values will be significantly less). In a virtual private server, this will be shared bandwidth and (should) mean there is a fair usage policy involved. Unlimited hosting is also commonly marketed but generally limited by acceptable usage policies and terms of service. Offers of unlimited disk space and bandwidth are always false due to cost, carrier capacities and technological boundaries.