It is easy to get tech terms confused with one another. There are so many, and they change and develop very rapidly. This is particularly difficult with technologies that are often used together. Such is the case with virtualization and cloud computing. Is cloud hosting the same as virtualization? The short answer is: no. The long answer is much more interesting.
Virtualization is a technology that allows a systems administrator or user to run multiple instances of operating systems on a single machine. Each virtual machine functions as though it were running on a computer by itself. This makes virtualization very useful for hosting and also enables hosts to offer virtual private servers (VPS).
Cloud computing may refer to any software, platform, storage, or other technology offered remotely and often as a service. For example, instead of hosting your email delivery system on your own server, you would rely on a cloud service, such as Google Apps. Since the term cloud is very broad, it may include a variety of technologies and is not dependent on any specific hardware or software.
Cloud service providers may use virtualization to offer customers hot-pluggable services. For example, if a cloud provider offers a platform-as-a-service (PaaS), it may have a control panel that empowers the user to quickly create virtual machines, activate them, and then easily remove them later. Some service providers may also use virtualization to maximize server usage while minimizing total infrastructure needed for hosting, allowing them to offer lower prices to customers.
For the above reasons and others, cloud computing and virtualization are increasingly becoming linked because web hosts use both to provide services to their customers. Nevertheless, they are not synonymous, and either one can be effectively used without the other.