Virtualization Vs Cloud Computing: The Key Differences - V2 Cloud

Virtualization Vs Cloud Computing: The Key Differences


Virtualization Vs Cloud Computing: How To Easily Differentiate Both

Jan 18th, 2023
10 mins 54 seconds

Author: Grace Sweeney

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If you believe that the difference between virtualization vs cloud computing is just a matter of semantics, you’re far from alone.

While two terms are closely connected and often work together to provide a variety of services, they’re far from interchangeable.

Where virtualization is a technology that transforms physical hardware into virtual resources, the cloud is an environment that delivers virtualized resources on-demand through the internet.

Virtualization technology changes how physical infrastructure behaves, allowing multiple applications and operating systems to run on one system by creating simulated environments that operate in isolation.

Additionally, cloud computing uses virtualization technology to deliver services that allow end-users to access virtualized servers, apps, etc. without purchasing that equipment themselves.

Below, we’ll further break down the core differences between the two terms and the unique relationship they share.

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What is virtualization?

Virtualization is a process that uses software to create computer-generated versions of servers, applications, data centers, and other types of hardware that behave just like their physical counterparts.

Virtualization software uses a thin layer of software, known as a “hypervisor,” which allows one computer to host multiple virtual machines (VMs). VMs are software containers that run their own operating systems and behave like independent computers–despite running on a small share of the underlying hardware.

The hypervisor also allocates computing power to each VM as needed for more efficient hardware utilization.

Virtualization technology allows companies to apply a cloud-like delivery model to their on-site infrastructure to improve internal workflows , security, and performance. Companies can also virtualize their infrastructure, software or platforms to deliver a range of services to their end-users.

Characteristics of virtualization

Resource Sharing.
Virtualization enables users to create separate computing environments from one host machine–be it a single computer or a network of connected servers. This allows users to limit the number of active servers, reduce power consumption, and manage.

Virtualization software’s self-contained VMs provide guest users (a designation that includes not only people but applications, OSs, and devices) with an isolated online environment. That separation protects sensitive information while also allowing guests to stay connected.

Virtualization software offers several features you won’t get with physical servers that help increase uptime, availability, fault tolerance, and more–helping users avoid downtime that undermines user productivity and introduces security threats and safety hazards.

While virtualization allows multiple devices to share resources from a single machine, it can also be used to combine several devices into one powerful host. Aggregation requires cluster management software, which connects a homogeneous group of computers or servers together to create a unified resource center.

These days, virtualization platforms ensure constant uptime via automated load balancing, which runs redundant servers on different host machines to prevent outages. That way, hardware failures are little more than a minor inconvenience. Do note that if downtime is a major concern, you might need to invest in some backup hardware to act as a fail-safe.

Use cases and examples of virtualization

At its core, virtualization is about getting the most value possible from the resources you have. While virtualization covers an endless stream of use cases, here’s a quick look at some of the more common applications.

Server virtualization
One of the biggest benefits offered by virtualization is server consolidation. In this case, virtualization allows companies to use one server to support multiple functions that might otherwise be spread across several single-use servers. Server virtualization allows users to consolidate and redistribute resources for more efficient resource utilization.

Data Virtualization
Data virtualization allows users to easily manipulate data using an abstraction that exists independent of actual data structure and database systems. The abstraction serves as a sort of “scratch paper" where users can check their work for errors before saving it “for real."

Software virtualization
Software virtualization is designed to separate applications from the host machine’s underlying hardware and OS. You might use software or application virtualization to see how a new application interacts with your existing stack, before integrating with your real-life toolkit.

Either way, software virtualization allows you to create a copy of your current configuration and its data you can use to test new applications, software updates, and all kinds of hypothetical scenarios without putting your actual installation and original datasets at risk.

Desktop virtualization
Desktop virtualization allows users to run multiple desktop operating systems from a single computer and fall into two main categories. There’s locally hosted desktop virtualization, which uses a hypervisor to run multiple operating systems from one computer.

There’s also virtual desktop infrastructure, or VDI, which runs multiple VMs from a centralized host and delivers streamed desktop environments to users. VDIs allow organizations to provide services like remote security monitoring or cloud-based applications to end-users, as well as support distributed teams and outsourced employees, as well as multi-location companies.

Storage virtualization
Storage virtualization combines multiple network storage resources into a single storage device that users can access from various locations. This allows connected servers, devices, and applications to access information from a centralized dashboard, without needing to know where, exactly, that information is stored. Virtualized storage also makes it easy to back up your systems and move data around as needed.

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What is cloud computing?

As mentioned, clouds are environments that abstract, combine, and share virtual resources over a network. Cloud computing is a computing model tasked with running workloads in that environment.

Virtualization in cloud computing is used to replace physical files, servers, networks, files, applications, devices, and infrastructure with computer-generated versions, which are hosted and managed by a service provider.

Providers use management software to automate repeatable processes to enable on-demand self-service via URL or mobile app, and control the data, security features, storage capacity, and computing power required to transmit data between user devices and the cloud.

Cloud computing services typically fall into one of the following three categories:

  • Software as a Service (SaaS)
    SaaS is the most common type of cloud-based service, designed to provide access to software through a browser or app without any hardware installation or maintenance requirements. While some services are free, many require a monthly or annual subscription. A good example here is Elementor. A SaaS platform, the website builder offers cloud hosting for WordPress

  • Infrastructure as a Service (IaaS)
    IaaS providers take SaaS a step further and manage the customer’s software, hardware, servers, storage, and any other essential requirements. Unlike the typical SaaS plan, IaaS users pay only for what they use on a weekly or monthly basis. Some vendors even offer the option to pay by the hour. While it may not always be the most cost-effective solution, IaaS supports frequent, rapid scaling in both directions.

  • Platform as a Service (PaaS)
    PaaS is a cloud environment designed to support application development and deployment. In this case, vendors provide everything a company needs to support the entire development lifecycle–from building and testing to deployments and updates–from one central hub. If a company needs an address for them to showcase their work, they only need a domain name with a desired domain extensions for that matter.

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Cloud computing characteristics

National Institute of Standards and Technology’s (NIST) guidelines, cloud computing is defined by five main characteristics.

  • Dedicated internet access.
  • Measured service.
  • Shared resource pooling
  • On-demand self-serve access. Customers must be able to perform all actions required to carry out a specific task like generating a report, sharing a document, or sending an email without any assistance from an IT pro or data analyst.
  • Rapid elasticity.

Use cases and example of cloud computing

Cloud computing examples cover a lot of ground, though most of it is probably familiar territory. Here are some of the more common examples:

  • Streaming services
    Think entertainment platforms like Netflix, Hulu, and Spotify, as well as platforms that manage real-time data logs or surveillance footage.

  • Data analytics and business intelligence
    Examples include Facebook’s Audience Insights, Google Analytics, as well as more sophisticated platforms with baked in AI and machine learning capabilities for taking on the challenges of big data.

  • Business tools
    Business applications include CRMs like Salesforce, customer service platforms like Zendesk, email marketing platforms like MailChimpmobile marketing strategies,and accounting tools like Quickbooks. This category includes a wide range of tools from social listening platforms to inventory planning and expense reporting apps. These days, many cloud-based solutions integrate with one another, allowing users to build a custom stack with minimal tech savvy. When you need to integrate non-Salesforce solutions you need to know why and how to hire a Salesforce commerce cloud consultant. Salesforce allows integration with various platforms and tools, but you need a skilled engineer to make it all work smoothly.

  • Collaboration & communication tools
    Examples include Google Drive, like cloud storage for photos and documents, Slack, Dropbox, and Zoom.

Virtualization vs. cloud computing

Again, “virtualization vs. cloud computing” isn’t a perfect comparison.

The real question is, whether to virtualize an entire IT ecosystem of owned assets or subscribe to the cloud-based services that address key needs.

Here, we’ve included a side-by-side of both options across eight critical areas.



Cloud Computing


Key Area

Cloud Computing


Service type

SaaS, IaaS, PaaS

VM’s can be accessible, though unlike cloud-based solutions, it’s not a given.


Offer anywhere access to users with internet access and valid credentials.

Major investments in hardware, storage, etc. Meaning, there’s not a ton of flexibility in terms of infrastructure.


Subscription model allows users to try different solutions, as well as cancel or upgrade plans within a couple of clicks.

Take on the role of “service provider,” which means you’re the one hosting and managing the infrastructure.

Hardware requirements

SaaS solutions don’t require any hardware, while IaaS and PaaS provide hardware as part of the service.

Allows organizations to create multiple redundancies that maintain uptime–even if a server fails.

Disaster recovery

Cloud platforms automatically sync data at regular intervals–ensuring easy recovery in the event of a disaster

Typically come with the option to add more host machines to your network as needed. Requires spending more on the solution and maintenance.


Helps organizations avoid overspending on excess capacity, allowing them to scale up and down as needed in response to demand.

Easily integrate with public and private clouds, IoT devices, and databases. If integrating with legacy equipment, integration software to unify data is needed


Easy to integrate with existing solutions, many providers support integrations and APIs. May require a data integration solution to prevent data silos.

Varies based on the complexity of your system. If you have the infrastructure, getting started may only require subscribing to a service or installing local software. Work with a company who can help you select and implement the right solutions.


SaaS platforms allow you to get started by setting up an account and working your way through tutorials. IaaS and PaaS solutions require installation and configuration–but these kits eliminate the compatibility issues common in custom builds.

Benefits of virtualization

Virtualization recreates the best aspects of physical hardware and makes several improvements aimed at helping organizations get better results from their machines, allowing organizations to consolidate their hardware and the resources needed to manage it.

Ultimately, virtualization works best for larger organizations with complex IT architectures or companies that sell cloud-based solutions.

Benefits of cloud computing

Cloud computing is both easier to implement and more affordable than virtualization technologies.

Users can easily access resources through a browser from anywhere with an internet connection, and month-to-month subscriptions and free trials allow users to shop around for the best-fit solutions.

For small companies with limited resources, this option makes the most sense–unless you’re a service provider or require advanced features like real-time data streaming or constant uptime.

Which one is best for you?

While virtualization technology comes with some seriously game-changing benefits, it’s a big commitment that requires a significant amount of resources and planning.

Organizations that currently rely on hardware older than five, six years are at a point where they’ll need to consider whether it makes more sense to invest in infrastructure upgrades or migrate at least some solutions to the cloud.

Still, for major enterprises, investing in virtualization technologies will pay-off long-term by unlocking new business opportunities and reducing operational costs.

Get the best of virtualization & cloud computing with V2 Cloud

V2 Cloud is a fully-integrated Desktop-as-a-Service solution designed with speed and simplicity in mind.

Unlike other desktop-as-a-service providers that rent virtualization software from middleware providers, we have our own solution. This means, clients pay for a SaaS-style subscription and avoid licensing fees and maintenance costs, which makes it the perfect solution for IT managers, Independent Software Vendors and Managed Service Providers

Ideal for business owners who want to offer a productive remote work situation to their employees. We ensure high-availability, reliable performance, and easy, secure access for your entire team.

You can learn more about our cloud desktops and what they bring to the table by clicking here.

if you want to have jump start you’re career in cloud computing, the best way to do so is to look at different cloud computing roles. This will allow you to have a better feel of the cloud computing scene and figure what skills are important in this industry.

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Written By: Grace Sweeney

Grace is a B2B content writer who helps SaaS brands & tech companies tell their story. Part content strategist, part SEO blogger, Grace turns out thought leadership content, e-books, blog posts, and web copy for clients on the regular.

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