Virtual servers, VPS are fully functional server platforms as seen from the world. What distinguishes them from real machines such as dedicated servers is that their existence is not dependent on a specific hardware platform.
However, the resources seen by systems installed on them are not real devices (disk, network cards) but virtual ones. These resources can be dynamically allocated, reduced or increased according to client's needs, or transferred to other physical resources in blink of an eye (hence the term cloud in which the virtual machine is located, although for the user it is not important in which physical part).
VPS servers are great simplification for users who are not responsible for physical elements of server,backup of entire machines is performed automatically and can be restored at any time in event of a malfunction of system installed on the virtual server.