What Is A Dedicated Server?
By ServerSmart.com

Dedicated servers offer webmasters and businesses of any size to rent pre-configured, ready-to-go web hosting or application hosting servers. Unlike shared web hosting or "virtual hosting" which requires you to share a single server with sometimes hundreds or thousands of other sites, a dedicated server is used by you and only who you decide.

With a dedicated server you are in complete control of things like:

Your choice of operating system
Ability to choose and install most any 3rd party software
Performance tweaks designed for your specific needs.
Ability to share your server space on your terms.

While dedicated servers do cost a good bit more than most shared hosting plans prices have dropped significantly. In 2000 a dedicated server for less than $400 - $500 was quite rare. In 2003 you can find dozens of quality dedicated hosts offering dedicated servers for less than $100 in many cases.

Who can benefit from a dedicated server?
Dedicated servers offers numerous advantages over shared hosting. If you have a large site or a site with considerable traffic a dedicated server is a wise consideration. If you are looking for additional 3rd party security for your site or emails a dedicated server can allow you this freedom. If you are a serious webmaster a dedicated server will allow you deep access to your server to configure and optimize your server anyway you need.

Summary
Dedicated servers have come a long way in the past several years. While there are still the countless uses for dedicated servers in mission critical and enterprise level applications the reduction in prices and extensions in features have made dedicated servers a smart choice for personal and small business use as well.