What is the difference between serverless and traditional server hosting?

Key differences: (1) Infrastructure management — traditional: you provision, configure, patch, and maintain VMs or containers; serverless: the cloud provider manages all infrastructure automatically; (2) Scaling — traditional: you configure auto-scaling groups with minimum/maximum instances; serverless: scaling is automatic, from zero to thousands of instances per second; (3) Billing — traditional: you pay for idle server time even when handling no traffic; serverless: pay only when code executes (per-invocation + per-GB-second); (4) Statelessness — serverless functions are stateless by design; traditional servers can maintain in-memory state; (5) Execution limits — serverless has timeout limits (15 min for Lambda); traditional servers can run indefinitely; (6) Cold start latency — serverless can have cold start delays; traditional servers are always running; (7) Operational overhead — serverless eliminates DevOps burden; traditional requires ongoing server management.