Byte

A standard byte is eight bits.

A typical byte is eight bits, meaning eight 1s and 0s.

A byte was originally the number of bits required to represent a single character of text.

The word “hello” fits into five bytes of ASCII code.

If you look at the photograph of the interior of the Spectrum[…], you will see that there is one ROM chip, and 16 smaller RAM chips. These chips give the Spectrum its memory. The memory consists of 65536 storage units that each contain one byte (a number from 0 to 255).

With a varchar, the storage is always the actual number of characters you have stored plus 2 bytes. So a varchar(20) with a 5-character word will take up 7 bytes, with the extra 2 bytes holding a size reference for SQL Server.