Cloud Hosting is a term used to describe a particular type of hosting scenario in which the server used for hosting arises ‘virtually’ from a cluster of machines managed by a piece of software called a hypervisor. It is similar to shared hosting in that this cluster provides hosting for multiple customers, but in the case of cloud hosting, a particular customer’s partition of space is spread over several physical machines. Each customer is given an ‘instance’ of a server which is highly configurable and flexible to the individual site’s demands and does not have the contention issues that a shared serving situation would, where you have hundreds, even thousands, of sites competing for the same resources. Another advantage is that since the space is across several machines, if there is an issue with the site, it can be rebooted on any of the machines, which eliminates hardware downtime.
It offers a slightly more robust alternative to VPS (Virtual Private Server) or Dedicated Hosting. Both of these types of hosting rely on the resources of a single machine (either virtually or literally).
While Cloud Hosting can be more affordable than VPS or Dedicated Hosting, it will still require a large amount of maintenance and management on the part of the customer. This is not the case with shared hosting, where there is no server management required, and which is more suitable for most small businesses and individuals.