Does a car need an engine? Does vbulletin need PHP?
Create a file calle phpinfo.php and write in there:
PHP Code:
<?php
phpinfo();
?>
Open this file in your browser. Look for GD support. If you don't have it then you have to install it manually. Many PHP Versions have GD support built in but not all versions. You can configure it during the compilation of PHP.
All this are hosting questions and have nothing to do with VBulletin. So if you have any further questions please look in the appropriate places.
Cheers,