The basic difference, from what I have been able to figure out, is that a dedicated server is just one single piece of physical equipment whereas a cloud hosting service is a virtual entity. A cloud host resides on a whole network of hardware. The main idea behind a cloud host is that data is replicated over many nodes on the network so when any one piece of hardware fails, other parts of the cloud network will move in to fill the gap. Of course this involves a lot more equipment, so the cost of cloud hosting goes up. As to whether you should go for cloud hosting, it depends on your needs. Do you need 100% uptime? And can you afford it?