koding.com has a free VM running Ubuntu. The specs are pretty good, 1 gig memory for example. They have a terminal online you can access through their website, or use SSH. The VM will go to sleep approximately 20 minutes after you log out. The reason is to discourage users from running live production code on the VM. The VM resides behind a proxy. Running web servers that only speak HTTP (port 80) should work just fine, but I think you'll get into a lot of trouble whenever you want to work directly with other ports. Many mind-like alternatives offer similar setups. Good luck!

A virtual private server (VPS) is created through the process of virtualization, by which a virtual replica of a physical server is created. A VPS is like having access to your own personal server with an allocated number of resources and choice of a pre-installed operating system. It is an isolated microsystem based on a shared server. Since a VPS is self contained, you have full control of your server setup and are responsible for all updates and security. You can also choose to opt for our managed service.
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In terms of backups, databases and files, it all depends on the type of setup you choose. If you choose a server with a control panel it will make it effortless but if you want to do it manually, i suggest you take some time to learn how to do it properly, because, one error and you might loose everything you have worked for. My suggestion for a best server setup is a cloud managed cPanel VPS with SSD and good backup tool.
At the end of the day, you need a reliable VPS that stays online, doesn't crash, and isn't slow. Our next generation VPS platform is highly available. We achieve this through 2X hardware duplication and 3X data replication. That means that even if something happened to your node, or even our infrastructure, we automatically switch to a backup. Spend less time fighting your web hosting company, and more time building your projects.
VPS has a dedicated IP address, which you do not have to share with other users. This is important, as in shared hosting many domains are under one IP address and if one website fails, the whole IP address is added to the blacklist. Also, in case of shared hosting, your website's load can be affected by another user on the same server. It means that if your "neighbor" website is loading or it is inaccessible for various reasons, your website loading time can be increased too.
Partitioning a single server to appear as multiple servers has been increasingly common on microcomputers since the launch of VMware ESX Server in 2001. The physical server typically runs a hypervisor which is tasked with creating, releasing, and managing the resources of "guest" operating systems, or virtual machines. These guest operating systems are allocated a share of resources of the physical server, typically in a manner in which the guest is not aware of any other physical resources save for those allocated to it by the hypervisor. As a VPS runs its own copy of its operating system, customers have superuser-level access to that operating system instance, and can install almost any software that runs on the OS; however, due to the number of virtualization clients typically running on a single machine, a VPS generally has limited processor time, RAM, and disk space.[2]
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