What is Cloud Hosting? How it Works, Types, and Top Providers

Updated Dec 23, 2022.

Choosing the best cloud hosting provider for your business requires understanding the concept and key features suitable for your business needs.

AWS icon

Amazon Web Services

A top cloud hosting solution for organizations using inter-connected web services with more than 30% of the global cloud service market shares
Google icon

Google Cloud

An affordable hosting solution that is easy to use even by inexperienced developers with 10% of the global cloud service market shares
IBM icon

IBM Cloud

A reliable cloud service provider used by some of the world’s biggest businesses with 4% of the global cloud service market shares
Microsoft icon

Microsoft Azure

A cost-effective hybrid cloud computation solution designed for web developers with 21% of the global cloud service market shares

Our work is supported by affiliate commissions.

Cloud hosting was not always as accessible to everyone. There was a time when the high costs of cloud hosting made it accessible to high-tech industries with the financial muscle and personnel to handle such cutting-edge digital technology.

Thanks to cloud service providers, cloud services are more affordable and accessible to all. Small businesses to large-scale organizations use cloud hosting for eCommerce, website, and social network hosting needs.

The best cloud hosts use multiple virtual servers to provide users with the best hosting experience. If you are wondering if cloud hosting is a great fit for your business needs, this article will provide the answers.

This article will explore how cloud hosting works, its benefits, what to look out for, and the best cloud hosting providers.

Let’s get started.

What is Cloud Hosting?

Cloud hosting uses a virtual server to host and run websites in a virtual environment without requiring you to purchase any server equipment. 

Unlike traditional web hosting services, which rely on a single physical server, cloud hosting distributes web hosting responsibilities across an assembled network of virtual and physical servers, irrespective of their geographical location. 

The Cloud is Having a Measurable Impact on Business
Source: GlobalDots

The activities of cloud web hosting managed by a cloud provider uniquely set up an effective and secure cloud infrastructure while also putting measures in place for its maintenance. 

Cloud service providers provide clients room to customize their hardware and unique applications to help scale their servers online. 

The computer and storage resources required for successful cloud hosting are often spread far and wide across many virtual machines responsible for load balancing the demands during configuration. 

Support for all kinds of databases makes cloud hosting a great fit for different applications and users. 

You can use cloud hosting for basic WordPress hosting, in-house hosting, to host websites and large website files, and for video games that require large computing power such as Minecraft hosting

How Does Cloud Hosting Work?

Cloud hosting functions as an Infrastructure as a Service (IaaS) and a Platform as a Service (PaaS). 

As an IaaS, cloud hosting provides users direct access to the virtualized hardware resources required to install their software hosting environment to build their unique web application. 

How Does Cloud Hosting Work
Source: MongoDB

On the other hand, PaaS is for users who already have access to a dedicated resource pool in a virtual environment. It provides a platform to install and develop web applications more rapidly.

Platform Portal Interface
Source: ResearchGate

Each cloud hosting server has specific tasks that guide its operation. This doubles as a backup strategy in ensuring web service continuity when other servers cannot carry out their functions. 

When users use the cloud hosting architecture to store their websites, they and their web traffic are guaranteed regular online and offline access as the information stored is spread across numerous cloud hosting servers for easy access.

Cloud hosting offers a wide range of services, from website management to database management, with relevant tools and features that make it easy for non-technical users to navigate the platform. It makes managing and creating a website a lot easier. 

Comperisons Between Laas, Paas and Saas
Source: BMC

Benefits of Cloud Hosting

In addition to the costs users get to save as a result of offsite web hosting, cloud hosting solutions offer many other benefits. 

Here are some benefits you can gain from utilizing cloud hosting.

1. Reliability of Solutions

The perks of being situated in an offsite data center that cloud hosting enjoys are that its multiple servers eliminate redundancies that minimize its failure rate and make its services available for both you and your web traffic. 

Cloud hosting modern data centers offer cloud computing infrastructure focusing on security and reliability at the highest attainable level. 

2. Physical Security

Cloud hosting data centers where cloud servers are stored come with multiple security measures to prevent data breaches and identity theft. 

The security measures often range from ID card scanners to security cameras to restrict the individuals that have access to the data centers.

3. Scalability and Flexibility of Resources

The storage and computing resources provided in cloud hosting do not experience the physical constraints of a single server system and hence can be scaled to the needs of its users. 

Due to the specialized data centers that your cloud hosting platform helps maintain, your cloud hosting service can easily borrow servers not in use from other additional servers if there is a need for further resources.

4. Utility Cost Management and Affordability

With the design of the cloud hosting service, you can better manage your utility cost. You only get to pay for the server resources and features you use, as no in-house servers are wasting away due to lack of use. Secondly, it is very affordable because the cheapest cloud hosting plans start at just $5 per month. There are enough such budget options. 

Types of Cloud Hosting

There are four different types of cloud-based hosting solutions that you can deploy for your web application, each with its features, advantages, and disadvantages.

Here are the four main types of cloud hosting:

1. Public Cloud

The public cloud is quite similar to a traditional hosting setup, providing a shared server for users to go about their activities. Users who utilize a public cloud for their cloud hosting must share their hardware components between multiple virtual machines.

The difference between a public cloud and a traditional shared hosting is that its virtual servers are ring-fenced not to allow sharing processing power with other users.

Hosting on a public cloud allows you to configure your own public cloud virtual firewall further to protect your system from a wide range of threats. 

Public Cloud Diagram
Source: PheonixNAP

2. Private Cloud

Public cloud hosting comes with insecurity concerns. Users that want comfort and a high degree of security opt for private cloud hosting. 

Unlike public cloud hosting, private cloud hosting does not allow users to share infrastructure. Each user maintains a separate physical cloud server with resources kept apart from other cloud accounts. 

In terms of cost, private cloud hosting is more expensive than public cloud hosting.   

Private Cloud Diagram
Source: Spiceworks

3. Hybrid Cloud

A hybrid cloud is an infrastructure that uses public and private cloud hosting alongside on-premises computing for its activities. 

This cloud solution offers better management and application across all cloud hosting architectures for a single, flexible and unified distribution across your computing environment. 

A hybrid cloud model offers web hosting users' main advantage is that it can effectively run and scale both traditional and cloud-based workloads with the proper computing infrastructure and structure.

Design for Failure
Source: InfoQ

4. Managed Cloud

Managed cloud hosting uses the cloud logic of providing IT functions to users to provide them with a better web service. 

A managed cloud service provides a wide range of support for its users in terms of physical infrastructure, applications, and virtual machines required for hosting your web applications.

The main advantage that managed cloud offers its users is easy-to-integrate solutions that are perfect for small and startup businesses. Due to these companies' lack of access to a dedicated IT staff needed to host a website, managed cloud hosting comes in handy. 

Managed Service Provider Infographic

What Things to Look For in Cloud Hosting

Generally, organizations consider many factors before deciding what cloud hosting type to incorporate into their business. 

Here is a list of the everyday things companies look for in choosing a cloud hosting type:

1. Level of Security

Several data breaches have plagued several of the world's largest companies over the years due to vulnerabilities in their web services. Companies can now use secure cloud hosting services to strengthen their security measures against data breaches. 

Incorporating web hosting security measures such as regimented backups, periodic scanning for malware, monitoring, and installing SSL certificates are practices that help make your web service safe.

2. The Extent of Support

Cloud hosting plans also come with a degree of support from technical and customer management teams. Companies are often considered the best at making their integration into cloud hosting easy. 

A cloud provider that meets specific requirements in their niche web application sector is the go-to for most companies when choosing a cloud hosting package. Consider a cloud host that supports the particular software application to your organization's development process. 

3. Performance Metrics and Features

Key performance metrics such as uptime, execution speed, and SSD storage capacity are among the critical factors determining an effective cloud hosting provider. 

Your cloud host needs to offer a wide range of features that enable you to perform several functions specific to your organization's needs and requirements. 

Free domain, customized control panel, and a money-back guarantee are among the extensive features that most cloud hosting providers offer their users. 

Top Cloud Hosting Providers

A wide range of cloud hosting providers across various niches and sectors are available to you. The best cloud hosting provider for you depends on your needs.

Top Cloud Hosting Providers
Source: Statista

Among a long list of cloud hosting providers, here are the top and biggest industry players in the cloud hosting world.

1. Amazon Web Services (AWS)

Overall Best Cloud Hosting Provider

Amazon Web Services- Explore the AWS Platform cloud products and capabilities

Amazon Web Services (AWS) is among the top cloud hosting service providers, with more than 30% of the cloud service market share. It offers building solutions to organizations using inter-connected web services. 

Best Features

  • Mobile Friendly Access: AWS is accessible on Android and iOS devices, with its mobile hub offering a wide range of compatible features. 
  • Serverless Cloud Functions: Amazon API and Gateway helps you run and scale your code. You only need to upload the code on your mobile devices, as AWS manages the whole process. 
  • Databases: AWS offers you several databases depending on your requirements for various functions. 
  • Storage: The storage feature is one of its most economical and easy-to-use features designed to meet your needs.


  • A wide range of capacity solutions
  • Virtual private servers
  • Fast and agile
  • Flexible and scalable
  • Cost-effective 


  • Price variations
  • Lack of experts

2. Google Cloud

Cheap Cloud Service Provider for Computation

Google Cloud- Build apps faster, make smarter business decisions

Google Cloud is a cloud web hosting provider that offers a wide range of web service stack solutions that are easy to use even by inexperienced developers.

Best Features

  • Integration: Google Cloud integrates seemingly with a wide range of Google tools for the best cloud hosting working environment. 
  • Storage: This cloud web hosting provider offers unique storage databases that help you manage and store your data.
  • Database: Google Cloud offers a wide range of databases that enables you to collect and store your non-relational data. 


  • Strict data and storage statistics
  • Excellent and open source integrations
  • Flexible solutions
  • Rapid development
  • Easy interaction on the platform


  • Migration is hard
  • Few global data centers
  • Geographical limitation

3. IBM Cloud

Best for Large Businesses

IBM Cloud- Your platform and partner for digital transformation

IBM Cloud is one of the key players in cloud computing with over 100 years of experience and a 4-6% market share. This cloud service provider is notable for providing computing software and hardware to some of the world's biggest businesses. 

Best Features

  • Computation: IBM cloud offers resources for the workflow to create and deploy apps on its platform. 
  • Multiple Programming Languages: This cloud service provider functions as a Service (FaaS) platform that supports various programming languages. 
  • Network Management: IBM Cloud allows you to manage different cloud network types cost-effectively. 
  • Storage: You enjoy private, public, and hybrid cloud solutions, which help you to offer better file and cloud storage services to its users. 


  • Flexible pricing policy
  • Implements a data-first approach
  • 256 MB of Cloud Foundry memory and a $200 credit free trial


  • Time-consuming process

4. Microsoft Azure

Best Hybrid Cloud Solution for Organizations

Microsoft Azure- Security that supports innovation_

Microsoft Azure, a branch of the Microsoft brand, is a hybrid cloud computing solution that offers its users the best user experience-focused designs in the world of cloud service providers. It offers the most robust set of cloud tools to all categories of web developers.

Best Features

  • Support: Microsoft Azure offers its users strong support in analytics with built-in support that analyzes data and critical insights. 
  • Integration: This cloud service provider integrates seamlessly with the organization's existing IT support through its secure connections and hybrid databases. 
  • Storage: Microsoft Azure has an extensive storage system with more delivery points and data centers than other top cloud hosting providers. 
  • Scalability and Flexibility: Users enjoy enhanced scalability and flexibility to meet their specific requirements and level of functionality. 


  • High availability
  • Data security
  • Large storage space
  • Scalability and flexibility
  • Cost-effective


  • Microsoft Azure requires a level of management
  • Platform expertise needed

What Types of Websites Use Cloud Hosting

The significant websites that use cloud hosting for their activities are eCommerce, news, and search engines. Social networks and high-traffic projects use cloud hosting.

Websites with Large Server Resources Requirements

Cloud hosting works best for websites that rely on processing power, bandwidth, and disk space to accommodate their seemingly large inflow of visitors on their sites. It can help store large amounts of files and data that comprise websites. 

A typical cloud hosting architecture makes it easy for websites to deal with traffic surges witnessed with eCommerce websites during flash sales or news websites when posts go viral.

Websites with Sensitive Data  

Websites requiring strict security measures to deal with sensitive data shared on their sites, such as customer information and credit card details, usually opt for private cloud infrastructure instead of a public one. 

The perks of using a private cloud for your website are that it offers a dedicated and secure cloud infrastructure on a private network to prevent breaches from unauthorized individuals. 

Large Business Websites

Financially stable and big websites use cloud hosting even though web hosts charge more for cloud hosting benefits as the rewards far outweigh the cost, a perk that small and medium sites cannot afford. 

Best Overall

Amazon Web Services

A top cloud hosting solution for organizations using inter-connected web services with more than 30% of the global cloud service market shares
Cheap Cloud Hosting Option

Google Cloud

An affordable hosting solution that is easy to use even by inexperienced developers with 10% of the global cloud service market shares
Best for Large Businesses

IBM Cloud

A reliable cloud service provider used by some of the world’s biggest businesses with 4% of the global cloud service market shares
Best Hybrid Cloud Solution

Microsoft Azure

A cost-effective hybrid cloud computation solution designed for web developers with 21% of the global cloud service market shares

Was This Article Helpful?

Rated 5 out of 5
5 out of 5 stars (based on 2 reviews)
Very good0%

Martin Luenendonk

Editor at FounderJar

Martin loves entrepreneurship and has helped dozens of entrepreneurs by validating the business idea, finding scalable customer acquisition channels, and building a data-driven organization. During his time working in investment banking, tech startups, and industry-leading companies he gained extensive knowledge in using different software tools to optimize business processes.

This insights and his love for researching SaaS products enables him to provide in-depth, fact-based software reviews to enable software buyers make better decisions.