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Is True Cloud Hosting like Digital Ocean Cheaper? A Deep Dive into Cloud Pricing
Updated: Aug 25, 2020 / Article by: Jerry Low
Cloud Computing has only really been more highly commercialized over the past ten years or so. Technically however, the concept has been in existence for much longer. The term ‘Cloud’ is mainly in reference to an ecosystem which encompasses a number of resources, pooled into one big group.
This results in an ecosystem that is able to offer computing resources that surpass the capabilities of individual servers, no matter how powerful they may be. Because of this, websites built on Cloud Hosting are typically very agile.
The infrastructure type also benefits from principles in distributed computing, allowing it to adopt some characteristics like increased resiliency and cost effectiveness. Still, even within Cloud there are varying types of service providers.
Cloud is similar to some other forms of technology such as Virtual Private Servers (VPS) and at the same time can be delivered in the form of Managed Cloud Services (also known as PaaS / IaaS in some cases). There are, however, distinct differences between each.
Knowing this can make the difference in the platform you choose to deploy on. Let’s take a closer look at each of these to see where they differ;
Cloud is Limitless
True Cloud providers are (usually) IaaS players who offer extensive resources since they pool a large number of computing resources together. Digital Ocean is an example of a Cloud service and allows users to easily scale up to a high amount of resources.
Because of this elasticity (or scalability), the price of Cloud hosting can vary quite a lot. They range from as low as a few dollars a month for select services all the way to however much you need.
VPS is Limited to Single Servers
VPS on the other hand offers the same isolated environment and dedicated resources that are found on the Cloud. The distinction is that VPS technology is not always Cloud-based and can refer to some on individual servers as well – thus limiting its scalability.
Prices for VPS are generally higher than regular shared hosting but often less than dedicated servers. They still vary quite a bit depending on server configuration and can stretch from a few dollars into the thousands.
Managed-Cloud Offers Third-party Cloud
Managed-Cloud providers do not run Cloud infrastructure themselves. They offer management panels and a choice of Cloud providers to users. An example of this would be Cloudways, though which users can choose from Google Cloud, Linode, and a few others.
Managed-Cloud providers also group the different resources offered by Cloud hosting providers into standard ‘packages’, this making life easier for you. They do, however, tack on a bit extra to the pricing.
VPS Hosting Cost
Based on studies we’ve conducted on website hosting prices, VPS plans on average start from the lower spectrum at an average of $17.01 at signup. Mid-range prices increase to around $26.96 onwards.
However, this shouldn’t be taken at face value as there can be immense discrepancy in the amount of resources that one provider may offer over the next. As an example of this, SkySilk VPS plans start from as little as $2/mo. On the opposite end of the spectrum, some VPS plans can well exceed $2,000.
More examples of this price discrepancy can be seen in the following examples.
BlueHost steps up on the VPS pricing scale somewhat more and their VPS plans start from $18.99/mo. This hovers more into the mainstream pricing standards for VPS hosting, albeit on the lower end of the scale still.
InMotion Hosting’s VPS hosting plans start near to what is considered the middle-tier of VPS plans. However, they do stretch up in resources a fair bit and offer relatively powerful high-end VPS plans.
Managed-Cloud Hosting Cost
Managed-Cloud Hosting is the service provider that stands between end users and true Cloud providers. This has a number of implications for users. For example, because there is an additional layer, the solution provider often offers a more simplified dashboard and spoon-feed supports.
This comes at a cost and Managed Cloud is typically more expensive than True Cloud providers. Some examples showcasing this include;
Cloudways works with several cloud infrastructure providers, giving their users a greater range of choice. On top of that, they have their own interface which helps simply the management of Cloud resources for their users. This of course results in much higher prices.
To illustrate this, consider the cost of Linode with and without Cloudways;
Linode (on Cloudways)
The use of Cloudways more than doubles the actual cost of Cloud.
SiteGround markets a range of plans that it calls Cloud VPS. It works with Google Cloud and offers pre packaged VPS plans based on that. As you can see, with a starting price of $80/mo, the cost is significantly higher than what most VPS plans start at.
Kinsta offers only Managed WordPress hosting that is based on Cloud technologies. They work exclusively with Google Cloud. Because of their very focused business model, the Cloud is so simplified that it is almost entirely hidden from their users.
The use of Cloud in Kinsta's SaaS allows them to offer very powerful WordPress hosting plans that cost anywhere from between $30/mo to $1,500/mo. They have the option for even more powerful plans on request.
How is True Cloud Computing Usually Priced?
Where most web hosting comes as packages that include everything you need to run a website, Cloud hosting is more piecemeal. The reason for this is because users may want to configure their Cloud for different purposes.
For example, if you were to run a site that is heavy on delivery of media files, you may need something with more storage space and bandwidth, rather than computing resources. True Cloud hosting requires that you select the types and quantity of each resource separately.
Not only is each type of resource priced differently, but you also need to take into account the amounts you’ll need of each type. Some of these include compute, object storage, block storage, memory, and bandwidth.
That narrows down even further in some cases. Google for example, charges different rates for bandwidth pipes heading to and from different locations. To better illustrate this, let’s consider four popular Cloud providers;
Digital Ocean is a US-headquartered Cloud hosting company. It was an early proponent of Cloud technology and is today one of the largest hosting companies in the world. The company offers Virtual Servers based on KVM.
Advanced users can opt to select individual Cloud resources by themselves, ranging from Droplets to Kubernetes and Spaces. However, based on an aim to simplify the Cloud for the masses, it also offers a wide range of easy-to-adopt packages.
When it comes to brand names Google needs no introduction. It is one of the big dogs in the global fight for technological domination and has infiltrated almost every country around the world. However, Google Cloud solutions aren’t necessarily for everyone.
Unlike the others on this list, Google Cloud is extremely specific in the sense that they do not offer pre packaged solutions. You need to know not only exactly what you need, but also how much of it and from where. It can be an intimidating task.
Kamatera offers powerful Cloud computing solutions to its customers in very flexible ways. Users are free to configure the exact amounts of resources they want in a similar fashion to Google Cloud.
They do not offer pre-packaged solutions like some other providers do, but focus on the true essence of Cloud – agility. This results in them being a desirable option for a variety of very cost effective deployments.
Linode touts itself as offering the better user experience and claims to be one of the pioneers in Cloud services. Starting back in 2003 the company today has stated it is the “largest independent open cloud provider in the world”.
Compared to Vultr and Digital Ocean, Linode offers an additional dimension to potential customers. They can select a product range built with specific deployments in mind, such as websites, gaming, mobile applications, and more.
Vultr is a slightly newer addition to the pool of Cloud providers but it has grown significantly. Today it offers users a strong base of 17 data centers around the world to deploy from. Like Digital Ocean, it too offers a mix of pre-packaged resources as well as allows users to customize their own.
For those who want the power of Cloud without too much hassle, Vultr integrates a number of user-friendly features such as their click-to-deploy app solution. Despite this you still retain all the flexibility of Cloud in many ways, from choice of Operating System to complete control over your resources.
The Big Question: Is Cloud Hosting Cheaper?
As you can probably tell by now, Cloud Hosting prices can vary greatly.
Much depends on your exact needs, the service provider chosen, and the way you configure your service plan. Overall however, we can clearly see that Cloud is definitely more expensive than VPS plans in general.
It does however offer far greater value for money given the enticing potential of unlimited resources and easy scalability.
When compared to Managed-Cloud though, Cloud is cheaper since there is a bit of extra help that’s given by Managed-Cloud providers. Normally, that convenience in helping managing Cloud environments comes at a premium.
Beyond Cost – The Challenges in Cloud Adoption
Despite the fact that over 60% of organizations in the US and Canada have committed to moving onto the Cloud, many expect to face significant challenges. With the significant cost of Managed-Cloud, true Cloud is normally the more cost effective solution for businesses.
However, migration onto the Cloud requires extremely high levels of technical expertise. Organizations which do not have this expertise in-house are faced with the distasteful option of turning to a vendor – thus negating potential cost savings.
Technical challenges can include
Security and Management
Governance, Control, and Compliance
Interoperability (especially the migration of legacy systems)
Performance and service quality
The move also requires organizations to have a forward looking mindset in order to fully realise the benefits of Cloud technologies. This necessity isn’t necessarily only at the C-Suite level, but organization wide.
Final Thoughts: Which Should You Choose?
Despite all the information I’ve gathered here this is perhaps the only one I cannot accurately answer for you. To assess the ideal match, you need to know exactly what you need to deploy on the Cloud.
For example, taking into account just a website deployment – there are many different types of websites. Many elements influence the resources you need so you need to match those up to specific Cloud plans.
In concept it’s less of an issue. If you simply don’t have the technical means to deploy on the Cloud without help, then perhaps you may consider a Managed-Cloud solution. At the end of the day, the matter also boils down to dollars and cents.
About Jerry Low
Founder of WebHostingSecretRevealed.net (WHSR) - a hosting review trusted and used by 100,000's users. More than 15 years experience in web hosting, affiliate marketing, and SEO. Contributor to ProBlogger.net, Business.com, SocialMediaToday.com, and more.