For the last few years I have subscribed to numerous VPS services for hosting various web apps and web sites. I left shared hosting behind long ago, and found Mediatemple’s Grid offering to be a little lacklustre on a shoe string budget.

Aside from a brief spin on Linode and Slicehost, all the VPSs I have used have had one thing in common: they’re budget.

Budget VPS Providers

As with shared hosting, VPSs are now big business. They allow full root control, choice of OS and software stack in a completely virtualized environment, which means you avoid any overheads of someone actually having to house your dedicated servers. I do not know quite how many VPSs are squeezed on to a single physical server, but I imagine in the Budget VPS space, it is a few too many.

As virtualisation has become more and more cost effective, there are an increasing number of players in the budget VPS space hoping to chase down those infinitesimally small margins that come from selling VPSs to the cash-conscious masses.

It is now at a point where you can get a reasonably powered virtual server (say, 256Mb RAM, 10Gb disk) for under USD$5 per month. We also appear to be witnessing a constant downward spiral of pricing as providers attempt to undercut one another.

What constitutes budget?

As I mentioned, the likes of Linode and Slicehost do not really fall in to the budget category.

It would be reasonably safe to assume that anything less than USD$10 per month for a VPS is well and truly in the budget category. Now, there is a sweet spot (what it is, I do not know) where costs and revenue balance out into a nice tidy profit for providers, and if you are paying over USD$30 for anything less than a 512Mb VPS, you are probably paying too much (unless you depend on their technical support).

There’s a base cost, you know

What a lot of people - who buy these services and expect the world - do not realise is that there is a base cost to any VPS, and the closer your monthly subscription is to that base cost the poorer the quality of the service will be. You will be less valued as a customer to the provider because the margins are so low, and the more instances will be crammed on to a physical server in an effort to maximise profit.

It is fairly safe to assume that the cheaper your budget VPS service:

  • The poorer it will perform due to crowding on resources
  • The more likely you are to have your account suspended for running CPU a little high because of the detrimental impact on so many others
  • The more likely the provider is to go under, as the margins are so small

What happens to a budget VPS?

There is a great budget VPS listing sites by the name of Low End Box which covers VPS services under USD$10 per month.

It also has a monthly ‘Dead Pool’ category, where they cover a list of VPS providers that have either closed their doors, gone under or just dropped off the face of the Internets.

Put the two together, and you get a good idea of what will happen to your budget VPS if you don’t do a bit of due diligence when buying in to a service.

If you choose a reliable budget VPS provider (of which there are plenty, I should add) then you run the risk of hardware failures with no backups, account suspension for using a bit too much CPU (which is relative depending on how many others are on the same box and what they are all doing), low priority for support if the provider deals with bigger business and potentially sluggish performance during peak times.

Use them, but with a pinch of salt

I use several budget VPS and have got myself into a position where I pay a fair amount for good service. They are not amazingly performant machines, but I trust the providers are not going to overcrowd the servers and gradually degrade my service. I also recognise that I am paying USD$6 a month for a pretty good service, but there are inherent risks in that.

However, I have had a very cheap VPS with BuyVM suspended out of the blue. A file system watcher process had run for months and all of a sudden it was using “too much” CPU, because other people had been complaining of poor performance. It is a brutal and harsh process, but this is what the budget VPS providers need to do to stay in the game. (As an aside, I pesonally think BuyVM are vastly overrated - I am certain people recommend them on price alone, as their servers have all been very sluggish for me [on the IO front]).

There is a great VPS performance comparison between some of the more well known VPS providers (non-budget, mostly) - it is a great read, but do not expect your super budget VPS to perform anything like this. Anyone with a bit of cash and some Linux knowledge can set up a budget VPS provider, but Linode, Slicehost and Rackspace have built very successful businesses out of their (more expensive) VPS services.

So, by all means use a budget VPS, but do make backups, don’t trust a mission critical service to them. Expect them to go down every now and then and above all, don’t think you’ll have any recourse if your site or app does down and remember that your complaints will likely fall on uncaring ears.

This is not an attempt to promote these services, but they may help you shortcut some of the less reliable VPS providers:


If you have the cash to spare, go with Linode’s entry level plan. Their virtual-to-physical contention ratio is (probably) the best; they have great management tools and a fantastic track record. However, not budget at just shy of USD$20 per month (entry level).


I have a couple of VPSs with Burst.NET - who predominately deal in dedicated servers, colocation and regular hosting. They are a big, public company with great infrastructure and years of experience. Their budget VPS offerings span multiple data centres, seem very low contention and have performed very well for me. They also have a Premium VPS offering which has half the number of virtual instances per physical server compared to regular. Cheapest is USD$5.95 per month (512Mb VPS), but they frequently have 10-20% recurring discount offers.

My “biggest” VPS is with Bhost and it has shown itself to be the most stable and consistent; the server contention seems low and it has always performed well for me. Plenty of notice for rare scheduled maintenance, and only one outage I noticed which was 30 minutes because of a network switching issue.

Budget VPS providers to avoid

Simple. Anyone charging less than USD$5 per month (without discounts) are likely to be too big a risk if you care about what you’re hosting.