Dedicated web hosting refers to a web host using one server to host one particular web site. One of the benefits here would be that you don’t run into resource limitations. If a server becomes to overloaded from being used by too many sites it can start running very slowly and/or crash. When you have a business on the line this is the last thing you want or need. Dedicated servers will often resolve this issue altogether.
In some cases if you share a server you will also share an IP address. This would seem like it would be no problem until someone using the server does something inappropriate and gets blocked from certain things. This in turn will affect you because you will be blocked as well because you are the same IP address. The person who put a block on your doesn’t care who you are, they care about the IP address.
Dedicated servers are ideal for larger business or sites that need unlimited space, transfer, and back up. A dedicated server allows room for growth and many other capabilities. This is not to say that all dedicated servers will have more room, there are many hosting plans with unlimited disk space and unlimited file transfer and some dedicated servers may have a cap on these things. You have to do your homework.
When choosing a dedicated web hosting service you need to decide how much of the management process you want to be in on and how much you want to customize your set up. GoDaddy allows you to choose from a buffet of services when you do dedicated web hosting. Some companies will offer you a dedicated web manager to go with your dedicated web hosting.
Naturally, with so many options, so much more control of your features and more capabilities, you will pay more for your dedicated web hosting.