Cloud computing vs virtualization – which one should you choose for your business?

17.04.2024 2,422 8

Cloud computing vs virtualization. Both are helpful technological choices for building and maintaining the IT infrastructure of your business. Many people take them as the same thing but that is not correct. Both are closely associated, but their differences are significant enough to affect your company’s decisions. Think about costs, increased efficiency, and the capacity to share resources, for instance – both can help you reduce the expenses dramatically. They can be used for small, medium, and large enterprises. So how can you determine which one you should choose for your business? Let’s find out!

What is virtualization?

Virtualization is a technology that lets you use your hardware for various purposes at the same time by creating virtual machines on different layers. The process relies on special software – hypervisor. It can create virtual machines, also known as virtual environments or virtual instances, that use the resources of a computer more efficiently. For example, a computer that usually uses 25% of its resources, can be separated into four virtual machines and be up to four times more productive. Another advantage is that each of the virtual machines can be used for different purposes under different Oss.

Through virtualization, multiple virtual instances of computing resources, for example, networks, storage devices, servers, or operating systems, can run simultaneously on a single physical hardware system. Every virtual machine will work independently of each other, although they live in the same hardware, and both share underlying physical resources. If you have a business,  you can start calculating the benefits that virtualization can mean for you and your budget.

Read this article to know more about virtualization.

Check out the difference between router virtualization and firewall virtualization.

Virtualization advantages

  • Budget efficiency. While consolidating several or multiple physical servers into fewer or even a single server, businesses can reduce costs in different areas such as cooling expenses, power consumption, hardware costs, and data center space requirements.
  • Strong security. Virtualization provides strong isolation between virtual machines, enhancing security by preventing unauthorized access or data breaches, and minimizing the impact of security vulnerabilities or malware
  • Improved resource utilization. It optimizes computing resources’ use to the maximum for multiple virtual machines to share the same physical hardware.
  • Scalability. Businesses can quickly scale their IT infrastructure up or down to meet changing demand. With virtualization, adding new virtual machines or allocating additional resources to existing ones can be done rapidly and without the need for significant hardware investments.
  • Centralized management and automation. Virtualization platforms offer centralized management tools that simplify the administration and monitoring of virtual environments. Automation capabilities streamline repetitive tasks, such as provisioning, deployment, and patch management, whilst reducing administrative overhead and human errors.
  • Legacy application support. Businesses can run legacy applications on modern hardware by creating virtual machines with compatible operating systems and dependencies. Virtualization allows to extend the lifespan of legacy applications while migrating to newer infrastructure platforms.
  • Green IT initiatives. Virtualization contributes to environmental sustainability by reducing energy consumption, carbon emissions, and electronic waste associated with traditional IT infrastructure.
  • Enhanced flexibility and agility. Virtualization enables businesses to quickly deploy new applications, services, or virtual environments without the constraints of physical hardware. This agility allows organizations to respond rapidly to market demands and changing business needs.
  • Disaster recovery and business continuity. It simplifies disaster recovery planning by allowing businesses to create virtual machine snapshots or replicas that can be quickly restored in the event of a disaster. Virtualization also enables live migration of virtual machines, ensuring uninterrupted service availability during planned maintenance or hardware failures.
  • Testing and development environments. Virtualization is ideal for testing and development environments, allowing businesses to create isolated virtual environments for software development, testing, and debugging. It accelerates the software development life cycle by providing developers with on-demand access to standardized testing environments.

Learn how to test your site for extreme traffic.

What is cloud computing?

Cloud computing is a technology model that enables convenient, on-demand access to a shared pool of computing resources over the Internet. Instead of owning and maintaining physical hardware and infrastructure, users can utilize virtualized resources provided by cloud service providers.

Learn where is the cloud physically located.

Cloud computing uses virtualization as a foundation, but the big difference is that here we talk about service. It is a pool of servers that you can get a certain on-demand resource as a service, for instance, databases, networking, storage, computing power, platform, software applications, or others. As a user, you don’t have total control. You get what you’ve paid for through a specifically developed application or user interface.

Get a Neterra cloud server.

Cloud computing advantages

  • Cost efficiency. Cloud computing eliminates the need for upfront infrastructure investment and reduces ongoing operational costs, as users only pay for the resources they use.
  • Measured service. Cloud usage is metered and monitored allowing users to pay only for the resources they consume. This pay-per-use model offers transparency and cost savings.
  • Resource pooling. Cloud providers pool together computing resources to serve multiple users, optimizing resource utilization and efficiency.
  • Elasticity and scalability. Cloud resources can be scaled up or down dynamically to meet changing demands. Users can easily adjust resource allocation based on workload fluctuations produced by market demands and changing business needs.
  • On-demand self-service. Users can provision and access cloud resources, such as computing power or storage on-demand without human intervention from the service provider.
  • Broad network access. Cloud services are accessible over the Internet from a variety of devices and global locations enabling remote access and collaboration.
  • Reliability and availability. Cloud providers offer high levels of redundancy, data replication, and failover mechanisms, ensuring high availability and reliability of services.
  • Innovation. Cloud computing fosters innovation by providing access to cutting-edge technologies and services, enabling organizations to experiment, develop, and deploy new applications and solutions rapidly.

Cloud computing vs virtualization comparison

Here are the key differences between virtualization and cloud computing.

Cloud computing Virtualization
Scope and purpose Optimized use of multiple devices working together. Optimized use of a single device.
Deployment method Public, private, or hybrid cloud environments. On-premises data centers, desktops, or cloud infrastructure.
Resource Sharing Sharing computing resources of multiple devices among multiple users or tenants. Sharing physical hardware resources of one device, among multiple virtual machines.
Service Models IaaS, PaaS, and SaaS. Mostly focuses on infrastructure-level virtualization.
Abstraction level Takes abstraction to a higher level by abstracting not only physical hardware resources but also higher-level services and applications. Abstracts physical hardware resources (CPU, storage, memory, networking, etc.) from the underlying hardware.

Scope and purpose

Virtualization technology focuses on optimizing resource utilization, consolidating hardware, and providing isolation between virtual environments created in a single device. Cloud computing is a service model that delivers computing resources, such as servers, storage, databases, networking, and applications, over the Internet as a service.

Deployment model

Virtualization can be deployed in various environments, including on-premises data centers, desktops, or cloud infrastructure. It provides flexibility and compatibility with existing IT environments.

Cloud computing is typically deployed in public, private, or hybrid cloud environments. Public cloud services are provided by third-party providers over the Internet, while private cloud services are dedicated to a single organization and may be hosted on-premises or by a third-party provider. A hybrid cloud combines elements of both public and private clouds.

Resource sharing

Virtualization involves sharing physical hardware resources among multiple virtual machines. Each one operates independently, with its own operating system, applications, and data.

Cloud computing involves sharing computing resources among multiple users or tenants. Resources are dynamically allocated and managed by the cloud provider based on demand, optimizing resource utilization and efficiency.

Service models

Virtualization focuses primarily on infrastructure-level virtualization, enabling the creation of virtual instances of computing resources. It usually does not provide higher-level services or applications as part of the virtualization platform.

Cloud computing offers three main service models: Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS). These models provide varying levels of abstraction and control over the underlying infrastructure and applications, catering to different use cases and requirements.

Learn more about IaaS, SaaS and PaaS.

Abstraction level

Virtualization abstracts physical hardware resources (CPU, storage, memory, networking, etc.) from the underlying hardware. This means that instead of directly interacting with the physical hardware, users interact with virtualized representations of these resources.

Imagine a physical server with a single CPU, 16GB of RAM, and 1TB of storage. Through virtualization, this physical server can be divided into multiple virtual machines (VMs), each with its own virtual CPU, memory allocation, and storage space. From the perspective of each VM, it appears as if it has its own dedicated hardware, even though it shares resources with other VMs on the same physical server.

Key Point: Virtualization creates a layer of abstraction between the physical hardware and the virtual instances running on it. This abstraction enables multiple virtual instances to run independently on the same physical hardware, providing isolation, flexibility, and resource efficiency.

Cloud computing takes abstraction to a higher level by abstracting not only physical hardware resources but also higher-level services and applications. In addition to virtualizing hardware resources, cloud computing platforms provide users with access to a broad range of computing resources and services, all delivered over the Internet as a service.

In the infrastructure as a service (IaaS) model, cloud providers offer virtualized computing resources, such as virtual machines, storage, and networking, as on-demand services. Users can provision and manage these resources through web interfaces or APIs, without having to manage the underlying hardware.

Platform as a service (PaaS) goes a step further by abstracting not only infrastructure but also application development and deployment platforms. PaaS providers offer development frameworks, databases, and middleware as services, enabling developers to build, deploy, and manage applications without worrying about underlying infrastructure details.

Software as a Service (SaaS) abstracts even higher-level applications and services, providing users with ready-to-use software applications over the Internet. Users access these applications through web browsers or client applications, without the need to install, manage, or maintain software locally. Consider a cloud-based email service like Gmail. Users can access their email accounts and use all the features of Gmail without having to manage email servers, storage, or software updates. Gmail abstracts the complexities of email infrastructure and software, providing users with a seamless experience.

Key Point: Cloud computing abstracts not only physical hardware but also higher-level services and applications, providing users with a comprehensive set of computing resources and services delivered over the Internet as a service. This abstraction simplifies IT management, accelerates application development, and enables scalable and flexible infrastructure.

Cloud computing vs virtualization. Which one should you choose?

Both virtualization and cloud computing offer significant benefits for businesses of all sizes. Small businesses that are just starting and using external funding or those who need to test software under different OSs may find virtualization more convenient for optimizing resource utilization and reducing costs. Medium and large enterprises may benefit from cloud computing for scalability, agility, and innovation.

However, the cloud can suit small companies too. They can save money by using a plan matching their needs. There are cloud computing plans suitable for small, medium, and big businesses. You just need to find the right service provider. If you still haven’t started using cloud services, you can check our offers at

The right way to choose is based on your real business needs. Is it enough to satisfy your current needs to use software to rationalize the use of certain hardware (virtualization)? Or are you expanding so you need virtualization but also a way to unite more devices? Then, cloud computing is the answer.

If you think about virtualization as having a private cloud, a server that is owned or rented by just one client (you), this offers full control and adds as much software as the client needs. You can use 100% of its resources. However, managing a private cloud can be more expensive as you will need an IT specialist to keep the software up –to date. Hiring an external IT specialist is an option. You can also suffer downtime in the case of hardware failure or just when the software needs an update.

Scalability through virtualization has a limit. If you create too many virtual machines in one device, at some point you will have too little computing power for each. Scalability via computing cloud has wider limits. You can always pick a more robust plan – it’s very easy to set up, and you can literally start using your cloud in just a few hours. The cloud wins this round of cloud computing vs virtualization.


Cloud computing vs virtualization. Both offer many benefits for your business, no matter its size. Enhancing productivity, modernizing IT infrastructure, and reducing costs are big reasons to consider these concepts in your business strategy. Analyze your current and specific needs and choose the right option for you.

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