The term “hosting” does not describe only one service, but several services which provide various functions to a domain. Having a site and e-mails, for instance, are two individual services even though in the general case they come together, so most people see them as one single service. Actually, each domain name has a several DNS records called A and MX, which show the server that manages each particular service - the first one is a numeric IP address, which defines where the site for the domain is loaded from, while the second one is an alphanumeric string, which shows the server that handles the e-mails for the domain name. For instance, an A record would be 188.8.131.52 and an MX record would be mx1.domain.com. Each time you open a site or send an email, the global DNS servers are contacted to check the name servers that a Internet domain has and the traffic/message is first directed to that company. When you have custom records on their end, the web browser request or the email will be sent to the correct server. The idea behind employing separate records is that the two services employ different web protocols and you can have your website hosted by one company and the e-mail messages by another.