The main difference between a servo motor and a stepper motor is that a stepper motor allows the motor to "lock" into place. A servo motor does not allow this; instead a position is held by closed-loop feedback. Because of this difference, the stepper motor provides more holding and low speed (<1000 RPM) torque.
Servo motors will provide less attenuation of torque at high speeds, however begin with a low holding torque. In systems where high precision closed-loop (speed and position) and high speed operation (>3000 RPM) is needed, a serve motor is appropriate.
The stepper motor, however, also provides a very viable solution. Low speed torque, cost-effectiveness and simplicity of the stepper motor systems make a good option for many applications.