A brief description of dedicated hosting

Dedicated hosting is a type of server hosting where an individual, corporation or organization leases a server for exclusive use. The host computers are not shared with anyone else and they are granted full root access and administrative control of the system.
This service exists in two types; it can either be managed or unmanaged. A managed arrangement is where the service provider offers full or partial system maintenance. They also provide some level of server support, which may include security updates and operating system provision.
Any issues are fully handled by the service providers. The customer and the server proprietor may agree on terms of use as well as the level of management that will be offered.
Unmanaged hosting is where a client fully controls the servers are.  They handle any upgrades, maintenance and issues that may occur. The host service provider is seldom involved in running system operations. However, they are responsible for any replacements needed.
Such an arrangement has several advantages.  If one has the capacity to control the server, it translates to scant third party involvement, hence lesser operating costs.
However, this comes at a handicap. The clients are completely on their own, and any involvement of the service provider will set them back tidy sums in hiring their services.  
Control of bandwidth and connectivity is largely under the responsibility of the client.  A client company gets the upper hand in bandwidth allotment to suit specific needs, such as increased data traffic.  
Bandwidth pricing is agreed upon by both parties.  Billing may differ widely across different providers; there are no regulatory standards as yet.
Dedicated servers are mainly used by large organizations who handle   large volumes of data. Small entities opt for the cheaper shared servers, because this arrangement is quite expensive.  It is however   appropriate for large scale web investments,    because it guarantees a higher return for invested funds.