What’s The Difference Between Cloud Computing & Virtualization?

The difference between virtualization and cloud computing is simple enough, once you understand both terms. I hate burying the lede, so I’m going to give you the briefest answer I can right now: virtualization is the technology, and cloud computing is one of the results of that technology. In other words, there can be virtualization without cloud computing, but without virtualization, cloud computing, as we know it, would not exist.

What Is Cloud Computing?

Cloud computing, as the name suggests, is a much more ethereal and abstract concept than virtualization. You might think of it as a methodology or approach to technology, rather than as a piece of technology itself.

Basically, cloud computing is the distribution of computing services over the Internet (the cloud). In the loosest sense, what you’re doing right now (reading this article online) is a form of cloud computing. The term is rarely used this loosely, however. More often than not, cloud computing refers to SaaS, server space, computing power, and other such services that are delivered over the Internet. The Internet of Things (IoT) is also sometimes thought of as cloud computing.

There are a number of facets that make cloud computing desirable. To understand those qualities, however, it’s important that we understand the underpinnings of modern cloud computing: virtualization.

What Is Virtualization?

Imagine this: you’ve got a computer running Windows 10, but you miss some of the old games you used to play on DOS (for me, the DOS game of choice is the old rogue-like Ragnarok). To uninstall Windows 10 just to download DOS would be a tad extreme. Fortunately, we can use virtualization instead.

You can think of virtualization as technology that lets you create a virtual machine (VM) – essentially, a computer within a computer. (Side note: that’s kind of a superficial way of describing VMs, but useful for our purposes).

Now, if you’re a business owner, it’s likely that running DOS in order to play long forgotten video games is not going to compel you to start virtualizing. Legacy software that only runs on DOS, taking up server space, on the other hand, might. You see, most servers are very underutilized, with only a fraction of their total power going toward whatever they’re hosting. You might have a server using only 25% of its capacity dedicated to running legacy software. By migrating that software to a virtualized computer on another server, you’ll save a lot in power and upkeep costs every year.

One of the main advantages of virtualization is that VMs can dedicate actual hardware resources, like hard drive space and RAM, to their operation.

Virtualization & Cloud Computing

The last point about virtualization brings us to why it’s so useful for cloud computing – you can distribute resources from X amount of hardware to Y amount of VMs. This has allowed large corporations to build massive servers and even bigger data centers. Two of the most well-known companies engaged in this practice are Amazon and Google.

Computer hardware benefits immensely from economies of scale. Amazon can purchase a ton of hardware, and that makes that equipment much less expensive for them to buy than it would be for individuals. They can then redistribute those physical resources to a variety of users through the use of VMs, effectively lowering the cost for everyone. What’s more, megacorporations can also purchase the space required for large servers. That much computing hardware needs a lot of cooling and a lot of power, and these things benefit from economies of scale as well.

The combination of cloud computing and virtualization allows us to do so many different things. A great example is Google Stadia, which allows gamers to access Google’s hardware to play games – no more need to buy state-of-the-art graphics cards yourself. As we discussed earlier, SaaS and cloud computing go hand-in-hand. By relegating secure hard drive space and computing power to each customer, as needed, SaaS companies can offer tiered, scalable services.

Another huge advantage of cloud computing is accessibility. Because shared resources are distributed at need and accessed through the cloud, SaaS and other cloud computing services can be accessed from anywhere at any time. This might be the primary reason we’ve seen such an uptick in SaaS since large servers and virtualization were coupled together – accessibility and security are both must-haves in corporate environments.

Some businesses use cloud computing and virtualization to simply rent server space – this is sometimes referred to as Infrastructure-as-a-Service, or IaaS. This is probably the most straightforward use of cloud computing – store your data and access it when you need to. When set up properly, VMs can allow you to run several different operating systems, so if you find the right provider, this can be a useful solution for companies with legacy software.


The idea of cloud computing has been around for a long time – virtualization has been around for a long time, too. Pairing the two together is what has brought out their full potentials, in part, because they offer security.

First, in order to access SaaS or other cloud computing services, multi-factor authentication is often required. That means, in order to use the service, you’ll need a password as well as some other form of identification (usually some physical identifier, like a code sent to your cell phone).

Second, cloud computing + virtualization enable you to access resources that aren’t being used by anyone else – those resources are dedicated to whatever cloud computing services you’re using. You should always be looking for ways to keep your business protected. Cloud computing means your data isn’t stored in one place, so even if there’s catastrophic failure on one server, your data will be available on another.

In summary, virtualization allows you to dedicate resources to cloud computing – it’s the underpinning of the modern cloud. It offers security, accessibility, and cost savings due to economies of scale.

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