Cloud Hosting: What it is; reasons to get it; and how to choose

16 Oct 2018 / Freeparking Team

Cloud Hosting Basics - What It Is and How It Works

Unlike the physical servers you can see and touch, cloud hosting provides hosting services on virtual servers which pull computing resources from extensive underlying networks of physical servers.

It is a way of storing data across multiple computers and accessing data through a network connection such as the Internet. In a typical hosting situation, you’re limited to the physical provision of your on-site server. Cloud hosting offers more.  You pull resources from multiple servers, resulting in a cost-effective solution that is reliable and scalable as your hosting needs grows.

The extent to which you tap from different networks depends on your current needs, which can be scaled up or down.

Recently, clouding hosting has become very popular especially among small businesses which need a scalable solution that doesn’t affect efficiency. The risk of downtime greatly reduces as your hosting needs are spread across different web servers.

What are the benefits of Cloud Hosting?
Save money

When you consider factors such as  ease of access to company files, pay-as-you-go services, collaborating on projects in real time, increased security and other benefits, you’re saving more money than you would on a physical server.

You don’t have to hire a tech team to manage servers as the fees are covered by the hosting company. It is a scalable option that lets you scale up and down. You pay for what you use.

Increased collaboration amongst staff and clients

One of the major benefits of cloud computing is that it increases collaboration among members of your team. Instead of waiting until everyone gets into the office at 9am, you can work together on a single project from any part of the world.

79% of companies who use cloud services  end up requesting a cloud application that allows for file sharing because they’ve enjoyed the benefits of collaboration. Team members view, work, edit and see changes in real time.


Customers who migrated to cloud services  commented on the difference in speed; from the 3—10 minutes it took to open content and another 3-10 minutes to publish content, to 30 seconds to log in and open content and less than a minute to publish content once they had migrated to cloud.

Automatic updates

Traditional hosting services require a tech team and a significant amount of time to manage, maintain and ensure the system is regularly updated. Often, the system becomes unavailable during the update.

With cloud hosting, service providers roll out automatic security and software updates. You don’t have to worry about maintaining the system. Your focus is on growing your business and daily operations.

Cloud stays on

Have you ever gone home from work only to realise that you forgot an important file at work and it's on your flash drive? It’s even more annoying when it happens on a Friday night and you were planning to work on the file over the weekend.

If you were on a cloud server, you didn’t have to worry about rushing back to work. The file is easily accessible online.  Cloud stays on  even when you’re sleeping. All you need is an internet connection to get access to your cloud applications.


Cloud computing is ideal for brands with fluctuating bandwidth needs as it allows you to scale according to the user’s needs. The scalability you enjoy gives your business a competitive edge over your competitors.  Employees are more flexible  as they can work from home, while on holiday, on the commute to work or while enjoying their morning coffee.

Improved disaster recovery and security

If you’re looking for a robust disaster recovery programme, cloud services are the right option. For smaller businesses that wouldn’t consider this option in the past because of funding and expertise, cloud architecture has helped them mitigate this trend.

Cloud Hosting vs Shared Hosting

Shared Hosting

Shared hosting is believed to be the cheapest type of hosting solution. Most web host companies advertise under $10 a month. It’s a plan where you share a single server with multiple users. Each user gets  a specific amount of bandwidth. You could put as many sites on your account as you want and the server is split between multiple accounts.

Shared hosting is especially common among new businesses and websites which have meagre resources. Computing and storage resources are limited because many users share a server.

It is ideal for websites that don’t get a lot of monthly visitors. However, if you run an intensive process critical to your business operations, shared hosting is not ideal for your business. The full power of the hardware is pulled in different directions at the same time. Websites and applications are always  competing for processing power.

Cloud Hosting

Cloud hosting allows the user to use resources from many services instead of being limited to a single server location. You’re drawing computing power from a pool of different resources across a large network, not one hardware.

It is an important hosting solution for websites that receive a lot of traffic. There is an opportunity for unlimited expansion and greater protection from an overworked server. When one server is overloaded, it switches the user to another cloud server for optimum efficiency.

With cloud hosting your resources are yours alone. This includes SSD storage, RAM and processors to ensure performance is at peak levels all the time. Your server is managed from a central control panel same as a shared hosting server but you have more flexibility to install and update apps. You can also manage SFTP files, manage databases and manipulate source code.

Regular hosting could break under an intense workload. Cloud hosting is more resilient. Your website resources scale to demands automatically.  Your website stays ready  for anything, 24/7. Nothing is unexpected with cloud hosting.

Cloud Hosting Vs Dedicated Server: Which is better for your business?

Dedicated server

A dedicated server is  a physical server  that you either own or rent for your business needs. You’ll mostly find it with a large organisation or business that has large data needs, high level of data security and high demand for server capacity.

Traditionally, it is a highly reliable way of hosting anything online from applications to websites and entire business operations. The server is set up by tech personnel, unlike a cloud hosting service where you can access the services within a few minutes of setting it up.

Cloud hosting

While it’s still comparatively new, cloud computing has the potential to become the only solution for hosting and data storage in the near future. Servers run in a virtual environment, not a physical location.


Which is better for your business?

You could spend up to $1,000 or more on dedicated servers, depending on your hosting needs. You pay for what you use with cloud hosting. Minimum billing usually starts from $50 and there is no limit because it’s a pay-as-you-use model. This means your data use is not capped.

Both dedicated and cloud servers are quite speedy. The problem with a dedicated server is that it could slow down a bit when it has  too many unwanted programme files  or temp files on the server.

The difference between both servers impacts how they handle requests. Cloud servers are more scalable. To take full advantage of the power of a dedicated server, you’ll need a tech team to wield it.  Utilisation for cloud hosting  is more cost-effective as it requires less manpower.

When making a choice, consider the current needs of your business, the advantages and  future scalability needs. The cloud solution offers more in terms of all-around performance which includes speed, affordability, reliability and scalability.

What Should You Choose? Cloud Hosting vs. VPS Hosting

As businesses roll out new technical innovations and strategies, the need to find hosting options that offer a competitive edge whilst allowing for more robust operations is heating up. E-commerce sites, especially online stores, are looking for  automatic scalable options  that grow with their businesses.

So far, most have moved towards cloud-based virtualisation and remote management systems. Two options we have today for virtualisation solutions are virtual private servers and cloud hosting.

Virtual Private Servers/Private clouds

This is a server that is based on the virtualisation mechanism. It has multiple individual dedicated slots on a single virtual machine and each slot is assigned dedicated resources. The physical server is split into smaller virtual servers that inherit the properties of the base server, while each act as a standalone server in a virtual environment.

Similar to a physical server, dedicated resources could be assigned to the virtual machines. It offers  complete freedom to manage your server  how you like and install software as you need. Hosting is efficient and VPS is secure. Files on VPS can only be seen by personnel you’ve authorised, regardless of their server rights.

A major vulnerability with VPS is that you might experience downtime when the server needs rebooting or maintenance. A resource could crash and the application or website is unavailable until the issue is fixed.

Cloud hosting

VPS and cloud hosting are quite similar. The major difference is that resources are spread out in cloud hosting whereas they are allocated to a dedicated server in VPS. It’s a network of unlimited virtual machines that rely on an underlying network. Think of it as one huge VPS connected via virtual machines. You enjoy more resources, increased power and flexibility.

Where the cloud shines is its  ability to scale. At the tap of a finger, you have as much additional storage as you need to meet traffic and storage demands.

For new businesses that are launching without thoughts of scaling, start with a VPS server. Cloud hosting is beneficial if you need a higher level of storage, security and performance.

Overall, VPS is limited and less efficient. The risk of suffering downtime or running into problems with your resource crashing is higher with a VPS.

When Should You Use Cloud Hosting?

If you’re looking for a flexible hosting solution that saves money while remaining efficient, you need cloud hosting. It is the preferable option for companies like Netflix and any brand that requires 100% uptime, higher bandwidth and performance. It is available at multiple price points including options for high traffic blogs and enterprise organisations.

Cloud servers are  fast, stable and secure. Software issues are isolated from your cloud environment so your business doesn’t suffer downtime. It simply migrates you to another server. It’s easy to migrate and install.

It’s a great fit for businesses that get a lot of traffic or those whose traffic rates are erratic. During spikes, you upscale and when your traffic needs reduce, so does your hosting resources.

It’s also great for business owners who don’t have a lot of technical experience but want to manage their hosting control panel themselves. However, some service providers require that you have a higher level of technical expertise to  properly manage your cloud server.

Reasons Why Businesses Should Use Cloud Hosting

Small businesses and large corporations who want to reduce cost and do business at the same time are on the cloud. It enables your business to access software and hosting services on the Internet.

Individuals who have smartphones or tablets are already using cloud computing with apps such as Dropbox and OneDrive. It backs up your information in the cloud so you can easily access it when you sign in from another device.

The benefits for businesses are bigger. You don’t have to set up an expensive computer service, hire tech guys to manage it or worry about running out of bandwidth. As storage devices on phones get smaller, your business can tap into the  rapidly evolving technology  to implement cloud technology today. Here are a few reasons why your business should adopt cloud services:


One of the benefits of cloud hosting is its flexibility. It changes and grows as your business needs grow.  Employees can work from any location on the same project.

For instance, if an ad agency was working on an advertising campaign for a client. The researchers, art directors, junior copywriters, senior copywriters and marketers could collaborate on the project at the same time through cloud computing.

The copywriter working on the train while going home for the weekend could create compelling copy and share it with the senior copywriter who is at home to make an edit. The art director sitting in a coffee shop somewhere creates graphics and design to go with the image. The marketing guys hanging out at a bar are looking at the same project on their iPad and adding input. Everyone is in different locations working at the same time.

This means the work never suffers. Some employees could work from home to reduce workstations. You save money on the workstation. The internet connection is very fast so everyone gets real-time updates as it’s happening.

Disaster recovery

The damage could be extensive if your information system becomes inoperable. You could lose customers, revenue, overhead cost, lost time and money to repair the damaged system. Every company that relies on computer systems needs a disaster recovery plan.

Many of the problems in traditional computing are fixed in cloud computing. You have to fix or replace cables, servers, software and computer networks for traditional systems. When a disaster occurs, cloud hosting offers more benefits.

There is  minimal downtime  because all your files are automatically backed up. You’re simply moved to another cloud server, files are copied and operations resume immediately.

There is no need to maintain any backup tapes, flash drives or external hard drives. Your backup is in the cloud.

In the case of a natural disaster that has a wide geographical impact, you don’t have to worry. Cloud servers are widely dispersed and redundantly designed so  your data in the cloud is safe.

Automatic software updates

Keeping your software updated is crucial to your website. It affects security, usability and compatibility. Hackers are always looking for security holes they can use to get access to your website. When there is a  new update for a software, the notes explain weak links that necessitated the update. You also enjoy better functionality and speed enhancements when you update your site. Where you had to worry about clicking the “update” button with traditional hosting options, the scenario is different for cloud hosting.

For many businesses, automatic update is one of the major benefits of cloud hosting. It's one less thing to worry about. There is  no need for an expert  to update your server as the service provider notifies you when a new update has been carried out.

Capital-expenditure Free

Research by the Aberdeen Group found that  48% of mid-sized companies, 38% of small businesses and 26% of large corporations have adopted cloud computing. Of this figure, 55% said they migrated because the cloud helped them reduce cost and 38% said IT was getting more complex. They had a hosting solution that saved time, lowered cost and was more effective.

When you install a traditional server, the service provider has to send a tech team to install the system. Setting up a cloud server is cheaper and faster. You’re not buying any expensive hardware or software because the cloud provider has already taken care of that.

It takes no more than a few minutes to set up a cloud server. The software is installed online and you can run it from anywhere. It also eliminates the need to pay for disk space. You have unlimited storage capacity with cloud computing. There is greater flexibility for your business needs because you pay for what you use.

Forget about  employing specialist IT staff. There is no worry about fixing bugs, upgrading software or maintaining the server. The cloud provider also takes care of these features.


Cloud hosting has got a lot of bad press, mostly because people don’t fully understand how it works. This has made many businesses wary of uploading data in the cloud.

One of the major benefits of cloud computing is that  you have complete control  over who can access content stored in the cloud. This includes who can edit, view or download data. Multiple staff can work on a single task while some edit and everyone sees the changes in real-time. However, only those you’ve granted access can make changes to documents.

The fear over cloud security is less about the security itself and more to do with the fact that you can’t touch or see the servers where your data is stored. This doesn’t mean it's not secure. Engineers who built cloud servers focused more on the  security of the server  than its physical location.

When migrating to the cloud, ensure that the provider runs vulnerability tests to prove the system is secure. When you look at how data is accessed on your cloud server, you’ll notice that it’s air-tight with no opportunities to breach.

Consider that employees, vendors and hackers do not have access to your  mission-critical data  when it is stored off-site in the cloud. It is almost impossible for a third-party to find your data and exploit it in any way.


Many businesses are adopting infrastructure as a service and cloud computing. It is becoming a vital tool for businesses that want to improve and gain a competitive edge.

When a new application or service launches, you’ll be the first to use it. Cloud hosting reduces the time it takes to  move from an idea to a service  or app. There is more innovation, collaboration and the ability to analyse large data effectively.

The cost of staffing an in-house IT staff reduces tremendously. Cloud providers take care of the updates, security patches to software and maintenance of hardware. You don’t worry about testing or upgrading hardware/software every month. Instead, your IT staff concentrates on products that deliver value to your company’s bottom line.

You also have savings on power use because you utilise what you pay for. It removes  the need for redundant systems, such as backup hard drives. You also don’t have to plan for spending extra money upfront. All these benefits result in better document control, streamlining and minimum downtime when hardware fails.

Environmentally friendly

In today’s world where everyone is worried about how much carbon footprint we leave on the environment, individuals are gravitating towards eco-friendly solutions. Dirty energy usage means the Internet has become a major contributor to carbon emissions.

Many companies are switching to  renewable energy sources  as part of their ecological company goals.

Do you want to reduce your carbon footprint? Switching to a public cloud offers more scalability, flexibility, lower overhead costs and it’s environmentally-friendly. Consider that server utilisation rates are around 5-20% for many corporate environments and small businesses. They need more servers to get work done.

When you migrate to cloud services,  utilisation rates are higher by up to 70%. Shared data centres need fewer machines to produce the same level of efficiency.

Considerations When Choosing a Cloud Hosting Provider

User Interface

Internet users desire a highly interactive, friendly looking and naturally controlled user interface that allows for smooth navigation of the cloud system. It is important that you choose a cloud provider that transfers the slick user interface you’re used to on the desktop.

For users that are on multiple cloud apps, it could be confusing switching between disconnected UIs. Look for a cloud provider that offers an intuitive interface.

Service Level Agreement (SLA)

Before you commit to a contract, it's important you read the Service Level Agreement. They should provide assurances that your data remains under the highest standards of confidentiality when you migrate to the cloud. Are they  liable in the case of a disaster? What are the measures to safeguard your data when that happens?

The cloud provider should also commit to  a 99.99% uptime. If there is a disruption, how do they compensate you for it? If there is a scheduled downtime, it shouldn’t conflict with your business.

There should be a predictable cost structure to ensure you get a decent ROI in the cloud. Unexpected price increment and hidden costs are unacceptable.


Documentation, Provisioning and Account Set-up

The service provider should have a document and proven process of dealing with unplanned downtime. The document should state how they communicate with customers when there is a disruption, the prioritisation, timeline and how they assign severity level.

They should also have a clear definition of services, such as roles relating to provisioning, delivering, monitoring, service management, escalation and support. Do their policies fit your requirements?


Performance is one of the major ways to measure the reliability of a cloud service provider. How have they performed when you stack their SLA side by side performance for the last year. Even the best cloud providers experience downtime but it’s how they deal with it that proves they are a provider you should do business with.

They should offer  reporting and monitoring tools  that integrate with your reporting and management system. Find out if there are any liability limitations and remedies they offer when issues arise.

Online Security/Data Segregation

All levels and types of cloud services should have comprehensive security infrastructure. Ask the service provider about their policies and procedures for controlling access to customer and provider systems. When there are changes to a hardware or software service is it authorised on a group role or personal basis? Who gives authentication to change data or application?

Ask the service provider if your applications and data will be stored in a shared environment. It's not the same as  onsite storage solution  that gives you control over the location of your data and who accesses it. Data segregation ensures your data is protected

Network Infrastructure and Data Center Location

The location of your data and the local laws guiding access should be considered. If you have specific obligations, look for cloud providers that give you choice and control over where your data is stored and managed. They should be open about the location of data centres.

You want a safe location where no one can break into. Ask about protection from natural disasters, such as earthquakes and storms. How is it  defended by thieves  who might try to gain physical access to the data centre?

Customer Service and Tech Support

Cloud providers offer managed services. However, IT tasks are split between your in-house IT team and the service provider. Depending on the terms and conditions, they should be responsible for server monitoring, hardware maintenance, software patching, OS and more. Your organisation administers the programme. Both entities communicate on a technical level when issues arise.

Look for a cloud provider that offers 24/7 customer support all year round. The Internet doesn’t go on holiday, neither should they. Support should be via email, live chat and telephone.

Billing Methodology and Pricing

Look through their pricing plan. Do they have a scalable package you can afford? Some vendors claim that their prices are the cheapest but they hook you with long-term contracts and high upfront payments.

The best options allow you to scale up or down based on your computing needs and offer flexible pricing accordingly.

Total Cost of Ownership

Many companies are so busy evaluating the best cloud providers that meet their workload needs that they forget to consider the total cost of ownership. That’s not to say cost should be the only consideration when choosing a cloud service provider. Providers are unique and testing performance across cloud providers on the same level makes it easier to find an option that balances cost and performance.

A few things to consider whendetermining costinclude hosting models, usage cycle, the variable cost in a public or private cloud, cost of internal management, IT lifecycle costs and transition cost.

Financial Security

Consider the financial stability of the cloud provider, their position on the stock market and the number of years they’ve been in business (preferably 10 years or more). Research their current earnings, stock prices and financial reports to ensure they have the experience andfinancial stabilitythat prove they will be in business in the future.


The cloud service provider should ensure 99.9% uptime and have a documented process for dealing with downtime. Check their disaster recovery provisions and how they support your recovery time objectives. You might need risk insurance if the cost of recovery is not covered by the cloud provider’s terms and conditions.

Also, learn about their backup,contingency and recovery plansfor data and the platform itself. If they backup your data offsite, they should have a reliable recovery strategy in place.

Physical security

Investigations by Verizon in 2012 shows that a lack of physical security at the data centre was a factor of a security breach in a third of the investigated cases. Your data provider should have sufficient physical security in place.

They should also provide environmental safeguards to protect data and equipment from disruptive events. There should be a business continuity plan, documented disaster recovery, a redundant networking and power plan.

The service provider should have complete control of the data centre where your cloud is housed. External persons shouldn’t have access to the facility. Other features, such as onsite guarded access, surveillance and round the clock monitoring should be provided.


Evaluate the cloud provider’s scalability through load balancers, bandwidth, data warehouses, servers and other infrastructural points. Analyse the level of service alongside the short and long-term growth strategy. They should show that they can improve or maintain current service levels as the number of clients and the size of your business grow.

The cloud service provider should provideadditional computing resourceswhen you need it to run a Big Data analysis or handle peak traffic. Check that it’s offered on a pay-as-you-go model.

Utility style costing

The pay-as-you-go cloud hosting model is a method that charges based on what you used. It’s just like how you pay for electricity and gas, using the resources you need. A benefit of this system is that you don’t waste resources, unlike traditional hosting where you pay for resources that may or may not be used.

Ensure you choose a platform that allows you todesign compute resourcesand charge only what you used. This includes memory, CPU, OS, storage, networking capacity, security and any software you’re running in your cloud environment.

Categories include Platform as a service (pay per gigabyte of memory or application used), Infrastructure as a service (pay per use by the hour, week or month) and software as a service.

Responsive load balancing

Load balancers are an integral component of a cloud environment. It is important in ensuring that your cloud applications and hosting services are always available to the end user, customers and staff. Load balancersdetect when a server is unavailableand automatically redirect traffic to operational services.

Determine thevolume of trafficyou want your cloud load balancers to handle. Would you be better served by an internal or external load balancer? Do you need regional or global load balancing?

Customer reviews

Reviews have always been a great way to gain insight into a company. When all is said and done, it’s the customer’s opinion that matters the most. Be careful of customers whogive glowing recommendationsof a service that doesn’t match with the uptime or those that look like spam.

The cloud provider should have excellent service engagement and customer service that complement the product they’re selling. Not all the reviews will be great but most of them should tell you what you need to know.

Top 10 Cloud Hosting Providers in NZ




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How is cloud web hosting different from traditional web hosting?

The major difference between cloud hosting and traditional servers is that cloud hosting is a system of virtual servers while traditional hosting uses physical servers. Cloud hosting has a highly scalable environment where you can access as much data and storage space as you need. Traditional web hosting only has a single server with the risk of downtime.

Is cloud hosting good for WordPress users?

Yes. Any CMS can be hosted on cloud including WordPress sites. Many organisations who use WordPress are leveraging the simplicity and scalability of cloud hosting to build a stronger infrastructural support for high traffic loads.

How does cloud hosting boost e-commerce sites?

There are many benefits for e-commerce sites in the cloud. Your website loads faster. You upscale and downscale to meet traffic demands. The cost of maintaining and developing IT infrastructure reduces as a well as a built-in redundancy that prevents data loss in case of a disaster, such as a natural disaster or security threats to the system.

Is cloud hosting right for my small business?

Cloud hosting is great for a business, whatever size it is. For small businesses who have to manage cost if they want to grow, cloud computing helps you enjoy the same advantages of a larger company. It gives you an edge over competitors who still use traditional hosting services. You save money on physical servers and storage, you can use it anywhere, work on files with colleagues in a virtual environment and reduce the risk of cyber-attack.

What are the alternatives to Cloud Hosting?

The alternatives include traditional hosting with physical servers, application hosting, database services, physical hard drives with wireless capabilities, office applications, document sharing, collaboration via Microsoft SharePoint and email services.

How much should you expect to pay for Cloud Hosting?

With cloud hosting, pricing is based on a pay-as-you-use model. There is a standard level pricing rate that often begins from $50. You can scale up or down to fit your hosting and storage needs. There are no billing surprises because you can see your monthly usage and quickly allocate more resources where necessary.


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