What are the differences between collections and streams?

The two concepts are fundamentally different in the way that a collection carries elements, while a stream does not. The Collection interface defines how you can add and remove elements, and how you can iterate over them. The Stream interface, on the other hand, defines how you can process elements: typically map, filter, and reduce them. So the two concerns, managing elements and processing them, are cleanly separated into two different interfaces.

This separation is very powerful because it allows streams to connect to any source of data: collections, of course, but also strings of characters, regular expressions, files, file systems, and network sockets. The limit is your imagination.

Connecting a stream to a custom source of data is not that hard. You need to implement the Spliterator interface, which is not trivial but not impossible, and pass this spliterator to the StreamSupport.stream() factory method. Neat!