The Differences between Virtualization and Cloud Computing

Virtualization and cloud technologies offer significant opportunities for small- and medium-sized businesses (SMBs) to improve IT infrastructure and processes. However, common traits between the two can lead to confusion about the differences between virtualization and cloud computing. To implement cloud and virtualization systems effectively, it is important to understand what makes cloud computing different than virtual servers, networks, and machines.

Why the Differences between Virtualization and Cloud Computing Are Important to SMBs

Technology and computer systems are required for the operation of most any business in today’s economy. However, most SMBs have limited financial resources to cover a variety of competing business needs.

The business benefits of virtualization and cloud technology can be considerable for SMBs, saving time and expense that can then be allocated elsewhere. Maximizing these benefits, however, requires a clear understanding of the concepts of cloud computing and virtualization as well as the skill and experience to implement systems that use these technologies in a deliberate way.

The Basics and Business Benefits of Virtualization

Virtualization uses computer code that mimics the functions of a physical device, allowing a software program to serve those functions. This allows the resources of a single physical device—a server, for example—to be divided and allocated to multiple purposes. 

Operating systems, networks, applications, and storage can all be virtualized, creating a more scalable IT infrastructure. The business benefits of virtualization include the following:

• Lower ongoing operating costs;
• More efficient use of hardware capacity, resulting in reduced hardware costs;
• Improved ability to manage growing quantities of data without additional hardware;
• Improved ability to provision and deploy resources;
• Access to virtual security measures;
• Simplified data redundancy and replication, resulting in better backup and disaster recovery;
• Reductions in energy costs; and
• Reductions in the footprint of hardware and the need for physical storage space for equipment.

The business benefits of virtualization of IT infrastructure are valuable, but virtualized systems do require an initial investment that includes the time of skilled technical experts in addition to the direct financial costs of conversion.

What Makes Cloud Computing Different than Virtual Servers and Other Solutions

To understand what makes cloud computing different than virtual servers, networks, or systems, the abstraction of the cloud must first be made more concrete. Cloud computing uses virtualization, automation, and the Internet to give users access to the computing power of physical machines that reside at a remote location or locations.

Cloud computing can be used for infrastructure, software, or platforms, including the following:

• Infrastructure as a service (IaaS)—servers, networks, and storage;
• Software as a service (SaaS)—email and customer relationship management (CRM); and
• Platform as a service (PaaS)—software or application development.

The Differences between Virtualization and Cloud Computing—and the Role of Virtualization in Cloud Computing

In cloud computing, virtual resources are centralized using management and automation software and then made available to users as needed. This is why virtualization is important in cloud computing. In fact, virtualization is the technology that makes cloud computing possible.

Innovations in cloud computing and virtualization have provided access to technology that was previously not available to SMBs. As with any technology or service, those who make IT decisions for businesses should educate themselves in the benefits and potential pitfalls of these systems as well as the differences between virtualization and cloud computing. When IT decision-makers fail to exercise due diligence, problems can arise—such as systems and services not performing as represented or regulatory issues related to data location, among others.