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The term database server may refer to both hardware and software used to run a database, according to the context. As software, a database server is the back-end portion of a database application, following the traditional client-server model. This back-end portion is sometimes called the instance. It may also refer to the physical computer used to host the database. When mentioned in this context, the database server is typically a dedicated higher-end computer that hosts the database.
Note that the database server is independent of the database architecture. Relational databases, flat files, non-relational databases: all these architectures can be accommodated on database servers.
In the client-server computing model, there is a dedicated host to run and serve up the resources, typically one or more software applications. There are also several clients who can connect to the server and use the resources offered and hosted by this server.
When considering databases in the client-server model, the database server may be the back-end of the database application (the instance), or it may be the hardware computer that hosts the instance. Sometimes, it may even refer to the combination of both hardware and software.
In smaller and mid-sized setups, the hardware database server will also typically host the server part of the software application that uses the database. If we consider a bank, for instance, the hardware database server will host the software database server and the bank's software application. This application will likely connect to the database via specific ports and use inter-process communication to log into and access the data resident in the database. The users in the bank, seated at their personal computers, will also use the client module of the application installed on their computers to connect to the database. In this example, there are actually two client-server models we are looking at: the database and the application.
In larger setups, the volume of transactions may be such that one computer will be unable to handle the load. In this case, the database software will reside on a dedicated computer, and the application on another. In this scenario, there is a dedicated database server, which is the combination of the hardware and software, and a separate dedicated application server.