1. For SEO purposes, it does not matter whether the website is hosted on a virtual server (cloud) or a physical server. Google openly stated that for ranking purposes "links to virtual servers are treated the same as to dedicated servers". So when you are planning on an SEO project, could hosting versus physical hosting is not a factor of importance for SEO
2. However, Matt Cutts, who is Google's official spokesman on the subject of SEO, did not say that "unique server IP addresses for websites" don't matter. And he did not say that "nameservers" don't matter. He was only talking about server types.
3. Matt Cutts did mention that the server location has some bearing on the search results Google serves. If you are in the States searching for "website design agency" you get different search results than if you were in France or Canada, for example. Hence, we can safely conclude that for SEO purposes, it is better to host your website with a hosting company whose data center is located in your target geographical market.
4. Even though there is no hard proof to this, our logic tells us that if a few dozen websites are devoted to the same area of expertise and hosted under the same shared server IP (cheaper hosting!) with the same nameserver, and all those sites interlink with one another (let it even be in a chaotic manner), Google will not give a lot of weight to links from such sites, especially if each site only has a few pages of content (even if it is unique content). This would have been to easy!
5. However, consider this situation: all other factors being the same, except this time hosting is spread across different geographic locations and websites are hosted under unique IP addresses with different nameservers. We reason that there is little to none excuse for Google not to give full credit to links from such websites (remember, the unique content rule has not been violated in either case).
6. Further then, if you had a choice, would you want Google to know that all those dozen domain names are owned by you? Officially, Matt Cutts states that the age of a domain name does not play a big role in ranking because this information is not always available. The whois data is not available for country-specific top level domains (TLD), for example (e.g. www.websitedesignottawa.ru or www.websitedesignottawa.fr). Instead, Google relies on such historical data as when "they first saw" this website online and when the first link to this website was registered in their database. In other words, the domain age factor cannot be factored into ranking in a universal manner, so Google does not give it "a lot of weight". Wouldn't the same logic apply to domain ownership as well? You would think so. But, there is one but. Google did not deny the fact that they do "see" the whois data when it is available. "Not a big role at all" might mean different things. If you own 500 websites in the same field of expertise and Google sees that you own them all and that many of the sites are interlinked, I prefer to think that the algorythim is smart enough to be suspicious about such an arrangement and not to assign a full weight to links from such websites. In my view, this "suspiciou" will apply especially strongly to domains in the same area of expertise. Given that domain ownership and SEO is one of the most common questions people ask, it is safe to assume that Google's engineers have accounted for that as well. So
7. If you are like me and would like to make sure you do things in a proper way right from the start, then you'd probably want to hide the fact that you are the owner of all those dozens websites. How do you do that? Easy: you can purchase what is called a "domain ID protection". Domain ID privacy can be purchased from Enom.com or your hosting company (Hostgator charges $10 per domain name per year for privacy ID). ID Protection can be purchased for the following top-level domains (TLDs): com, net, org, biz, info, name, tv, cc, me  (not for country specific domains like .ru or .fr).  But even then, some info will always be available to search engines: the current registrar, record creation date, expiry date, renewal date and the name servers associated with the domain.
8. With all that said, let us not forget that Google has been consistently pointing out that "good content", "unique content" and "relevant content" is what matters most for ranking. So in other words, if all your 500 websites do have a lot of good content, and even though you host them all on the same shared IP and nameserver and do not hide the fact that you own all of the domain names, if your content is good, then links between these sites might still boost their mutual SEO. But if I were to invest into such a project, I would want to cover my "rear end" and do not let myself be an easy target for one of Google's "ignore this link" triggers.
9. How much will it cost? Domain name registration is roughly $10 per year per domain, domain name privacy protection is $10 per year per domain; SEO hosting with unique IP and nameserver is about $4 per domain per month. In total, for 500 websites, you are looking at approximately $35,000 per year. Then, you need to add costs for technical labour to get all your websites up and running, content creation and project management. The whole project can easily add up to $100,000 and even more!

CONCLUSION: it is probably easier, cheaper and more effective to invest your funds and efforts into promoting one major portal (one website). Create good content, optimize it for specific keywords in a clever way and build back links via article submission to related web outlets and online magazines. Do not waste your time on links outside your area of expertise. Good content and specialization is what matters the most for SEO. And this is the topic of our next issue. Stay tuned!