What is cloud hosting and what are the benefits?

More and more medium-sized businesses are opting to rent IT resources from professional hosting providers instead of purchasing IT resources and employing specialists for their maintenance. As a result, different approaches to hosting have developed, which are suited to different use cases. We’ll explain what cloud hosting is and what to be aware of when making the decision to switch to cloud hosting.


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What is the difference between web hosting and cloud hosting?

In general, hosting models can be grouped into two main categories: server (web hosting) and cloud hosting. With serving hosting, a customer rents IT resources for a monthly fee, with different plans offering different levels of performance. This option allows customers to rent a physical server for their exclusive use. It’s also possible to share the computing resources of a physical server with other customers. The first option is known as dedicated server hosting, while the latter is referred to as virtual server hosting.

While some businesses may want to implement elaborate web projects with predictable resource requirements, other businesses may be looking for a hosting plan that can quickly and seamlessly respond to changing demands. For the latter, dedicated server hosting is not the right solution. When it comes to the modern IT needs of businesses, a more flexible solution like cloud hosting is a more suitable option. This relatively new hosting concept is similar to virtual server hosting but differs in that a virtualized server is spread across multiple physical servers, instead of just one. Additionally, costs in cloud hosting are typically billed on a minute-by-minute basis. This offers a higher degree of flexibility and scalability, providing a clear advantage over traditional web hosting models.


Regardless of whether you use cloud hosting or web hosting, there will always be security concerns when storing sensitive data on third-party servers. Find out more about cloud security and how to protect your cloud in our Digital Guide.

How does cloud hosting work?

Like virtual web hosting, cloud hosting is also based on virtualization, a process where multiple virtual servers share a physical server. With virtual web hosting, there is one physical server for a number of virtual servers. As such, they cannot be distributed across multiple servers and locations. With cloud hosting, virtual servers are able to access the resources of multiple virtual machines that are hosted on different computers. This makes it possible for an application to be distributed across a cluster of interconnected servers that provide IT resources on demand.

What types of cloud hosting are there?

Similar to web hosting, cloud hosting models can also be divided into several categories. The models are grouped according to how tasks are divided amongst the customer and the hosting provider.

  • Public cloud: The public cloud is a hosting model where the hosting provider provides the hardware and takes care of the maintenance and availability.
  • Private cloud: In a private cloud, all tasks and costs are taken care of by the company itself. This type of cloud is especially relevant for large enterprises and is referred to as an internal cloud or a corporate cloud. In this model, the cloud infrastructure is not rented from a hosting provider.
  • Hybrid cloud: As the name suggests, a hybrid cloud is a combination of the two models above. There are many possibilities for customization under this model. One example of this cloud model would be a traditional on-site cloud data center that is integrated with an external public cloud.
  • Managed cloud: A managed cloud is most similar to a public cloud. In addition to maintaining and providing hardware, the hosting provider also takes care of operational processes (such as monitoring and security) and application software. This is particularly beneficial for customers who want to focus on their core business operations.

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What are the benefits of cloud hosting?

1. Cost reduction

Of course, the biggest advantage of a flexible cloud hosting service is the immense reduction in costs. Rather than having to invest in in-house IT infrastructure, cloud computing provides the opportunity to cost-effectively meet the resource requirements of new projects using virtualized servers. With a pay-as-you-go structure, cloud users are provided with a refreshing change to traditional web hosting models, which demand substantial fees even if the server is barely used. The cost of maintenance, repair and inventory of the IT infrastructure is also significantly lower with a cloud service provider, as the bulk of the necessary hardware is already provided.

Cloud hosting makes it possible for smaller enterprises to have access to IT resources that had previously only been available to big businesses. The cloud also makes it easier for startups to enter into IT-intensive business sectors.

2. Flexibility and scalability

Through virtualization, cloud hosting offers the flexibility needed to promptly adapt IT resources to a business’s demands. This is of particular importance for web projects with fluctuating traffic. If, for example, the traffic in an online shop increases tenfold due to seasonal business, the performance features of a cloud server (such as RAM, CPU and online storage) can be expanded with just a few clicks.

It is important to note that projects that are constantly growing can also benefit from the cloud hosting model too. If a web project exceeds the peak performance of the dedicated server it is relying on, migrating to a new server will be inevitable. With cloud servers, on the other hand, additional resources can be added any time as needed. This is made possible by virtualization based on a network of closely interconnected server clusters. Instead of being located on a single physical machine, user data is distributed across several servers. When demand decreases, the added capacities can be reduced straight away and as a result, idle capacity charges are avoided.

3. Shortened development cycles

The cloud’s flexibility is particularly advantageous for startups and development departments of bigger companies. Investment costs for pilot projects remain manageable since the required resources are readily available. Furthermore, new applications can be tested and marketed substantially faster. Instead of assigning the time-consuming and costly task of purchasing new hardware to an IT team, cloud hosting offers developers the opportunity to generate any number of test servers with individually scalable performance features in the virtual environment.

Cloud hosting’s redundant server architecture also means users benefit from backups, ensuring that various development stages of a web project are retrievable. All of this results in reduced development cycles, securing not only a competitive advantage for companies but significantly cutting down on costs as well.

4. Data security and availability

Since the IT resources of a cloud server are provided by a number of physical machines, cloud hosting users benefit from comprehensive server hardware redundancy. This ensures that more than one backup copy of user data is stored on the servers in the data center at any given time. Potential failures of any hardware components, such as a hard drive crashing, have no impact on data security or the availability of the provided resources.

Outsourcing IT services offers medium-sized businesses the additional advantage of being able to gain access to technical procedures and security protocols that would be challenging to implement with their own resources. Due to the legal requirements that come with providing server hardware resources, web hosting service providers are constantly working to safeguard their data security in accordance with national and international legislation.

What are the environmental benefits of cloud hosting?

Cloud hosting not only offers businesses immense advantages; the environment also profits from the shared usage of individual components of IT infrastructure. Data centers that are designed for providing cloud servers have far more effective processes for power supply, ventilation and fire safety than those available in an in-house server room. Furthermore, many hosting providers use climate-neutral electricity and renewable energy for the maintenance of their data centers.


Learn more about green hosting in our Digital Guide.

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