What Vercel Actually Does

Vercel has the best marketing in developer tooling. “Deploy in seconds.” “Git push and it's live.” It works. But do you know what you're actually paying for?

What It Actually Does

Vercel takes your Next.js app, builds it, and puts it on the internet. Static files go on a global CDN so they load fast anywhere. API routes become serverless functions that spin up on demand. Every time you push to GitHub, it builds a preview deployment with its own URL so your team can review changes before merging.

That's the core product. CDN for static files, Lambda for API routes, and automated build previews.

The Magic Trick Revealed

When you run vercel deploy, here's what happens behind the curtains:

  git push               Vercel                  AWS
    |                       |                      |
    |── Push to GitHub ────▶|                      |
    |                       |── next build         |
    |                       |                      |
    |                       |── Split output:      |
    |                       |   ┌─ Static assets ─▶| CDN Edge
    |                       |   │  (HTML/JS/CSS)   | (global)
    |                       |   │                  |
    |                       |   └─ API routes ────▶| Lambda
    |                       |      (serverless)    | (on-demand)
    |                       |                      |
  User request              |                      |
    |── GET /page ─────────▶| CDN ────▶ instant    |
    |── GET /api/data ─────▶| Lambda ──▶ cold start|
    |                       |           (0-5s)     |

The CDN is genuinely fast. The Lambda cold starts are genuinely annoying. Vercel is essentially a very polished interface on top of AWS infrastructure, with smart tooling for Next.js specifically.

The $5 VPS Alternative

Any VPS can run Next.js. next build && next start on a $5 DigitalOcean droplet, Nginx handling HTTPS via Certbot (free), and PM2 keeping the process alive. A $5/month VPS handles 50,000 visits per month without breaking a sweat.

For CI/CD, GitHub Actions can SSH into your VPS and run a deploy script on every push to main. It's not as slick as Vercel's preview URLs, but it works.

When You SHOULD Use Vercel

When You're Wasting Money

The Hobby plan is free. The problem is the ceiling. The moment you go over bandwidth limits, add team members, or need more serverless function execution time, you're on the Pro plan at $20/month per team member. A 3-person team on Pro is $60/month before you've earned a dollar.

Vercel's Lambda cold starts also hurt apps with consistent traffic patterns. A VPS running next start has your app always-on with zero cold start. For API-heavy apps, this matters.