A website is a collection of files, some of which include text and images. For a website to be online, these files need to be stored, or hosted, on a special server which is connected to the internet. This service is called web hosting.
Most of the websites you see on the internet are hosted on 'shared hosting', which means they are stored on the same server as hundreds of other websites. Shared hosting is quite cheap, costing anywhere between $5 and $50 a month. Companies offering low-cost hosting generally squeeze the maximum number of websites on each server to increase their profits, even if this has a negative effect on website performance. It's not always true, but as a general rule, you get what you pay for.
If you are ordering your first website and aren't expecting thousands of visitors a day, shared hosting is almost certainly all you will need, at least to start with. If your site starts to get busier, you can always upgrade your hosting later.
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Thanks to the seemingly endless list of free and premium add-ons, Wordpress is a superb choice if your website needs sophisticated functions and facilities, or if you want to run a blog. However, WordPress needs a lot of memory and processor resources to function well. The more add-on functions your site needs, and the more visitors your site gets, the more resources and memory Wordpress requires. Shared website hosting comes with a series of restrictions on memory, CPU use and PHP usage/memory, which can make it unsuitable for Wordpress sites. Some hosting companies provide dedicated 'wordpress hosting' which is configured for better performance, but which is also more expensive. In any event, as the number of visitors to your site increases, you will need to upgrade your hosting to allow for the increased memory and resource usage. It's true that there is more to it than is written above, but that's all you need to know to get started.