Traditionally, companies used to simply purchase a server and set it up if they wanted dedicated web hosting. This was particularly the case if they had sensitive data, such as important passwords and payment information. However, server virtualization has changed the game by allowing outsourcing companies to have massive servers that can be split into individual virtual environments.
Server virtualization is the process of using a large set of operating systems, processors and physical servers to act as a unified server of indefinite size and speed. In some cases, a company may only need a few GB of data and a relatively low connection speed. In other cases, a company may require a massive amount of storage and lightning speed to function effectively. The purpose of server virtualization is to mask the physical resources used, so the individual company can focus on their core function using the virtual server.
Server virtualization can help in many ways. For one, you can generally use as much or as little data and bandwidth as you actually need. For many companies, it is tempting to purchase the most powerful and largest server you can get, since it can be difficult to predict upticks in business and the goal is almost always growth. However, this can lead to wasted capital, both on the purchasing and maintenance sides. With server virtualization, you can pay for precisely what you need to use, and even adjust your usage on a month-to-month basis if there is a sudden change. You have essentially infinite potential capacity without having to make large upfront investments.
As well, server virtualization helps your company by providing a dedicated staff that is always on duty. Most companies do not have the size or data transfer volume to justify having a staff on-site at all times, particularly when their training can be expensive and their skills highly sought-after. A server virtualization company, on the other hand, can justify these expenses easily and provide what many smaller companies cannot reasonably afford.
Finally, server virtualization saves a tremendous amount on the climate control, physical security and backup expenses that are commonly associated with starting up your own server. There was a time when an ordinary desktop computer in a back room with regular air conditioning could be used as a server, but that time is far in the past. Today's infrastructure is too temperamental, and security is too important, for anything but top-level measures.
In most cases, server virtualization is intended to be outsourced. Unless your core business is server virtualization, outsourcing is the only reasonable way to use this technique. Outsourcing companies are the core providers of virtual servers.
While downtime is always a possibility under extreme circumstances, in nearly all cases server farms have numerous layers of defense against excessive downtime. Often, the virtual server is spread across several physical servers, each with uninterruptible power supplies backed up with solar or wind power, and running on high-capacity Internet lines. As well, server farms where virtualization occurs have top security measures in place to ensure that tampering does not happen.
Data handling is the core responsibility of server virtualization companies. As such, they are bound by contracts and non-disclosure agreements. In most cases will have only the most cursory access to your data. The process can be likened to renting a storage locker -- while the management has a key in case they need to get in, under almost no circumstances will they use this method.
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