This is taken by a camera that always remains completely horizontal. The panoramic projection needs to be wrapped around the viewer in a cylindrical fashion. A second type is the spherical panorama. The set of images are taken by a camera that is allowed to tilt up and down as well as rotate left and right. The image set therefore needs to be projected onto a sphere.
Spherical panoramas behave in a more sophisticated manner.
For instance, if you are standing next to a vertical pillar, when you look upwards, the pillar will look narrower the further up it goes. If you then tilt downwards, the pillar will distort and become narrower the further down it goes. Cylindrical panoramas will always keep the pillar width constant.