Amazon have had some recent outages (Bots to blame for Amazon.com outages? | The Register) which raise a spectre of doubt for me over the viability of cloud computing services.
These services allow smaller organisations to benefit from large investments in computing power made by a small number of organisations, Amazon, Google, etc and buy IT infrastructure as a service.
The concern for me is that they provide a very, very big and obvious target for people of nefarious intent to aim at. Global brands like Amazon represent a prize for hackers and it would seem if one goes down, everyone goes down. Their being S3 services were affected as well, taking down all customers services that rely on them.
Doing it for yourself, on your own servers gives you the protection of the crowd in much the same way as being in a shoal of fish provides protection to the individual members from predators. Of course, you have to do a certain amount of self protection but being far less likely to be a target makes that a lot cheaper.
The counter argument is that these large cloud services organisations have the resources to hire the best defensive minds in the business to protect their investment, a level you couldn't possible afford or justify on your own. The problem is that these people are defending against the best attacking minds in the business because they're protecting the biggest prize, it's a classic arms race.
Another argument is that these services allow you to scale your service rapidly in the face of unprecedented demand. You never know, your service might become de rigueur and in the Internet world that means millions of hits.'You only get one chance'.
Entrepreneurs lap this one up, being the eternal optimists that we have to be to survive the start-up trials, of course my service is 'the one' I'm just waiting for the market to realise and then I'll be ready. Looking at it a little more pragmatically, this is a million to one shot.
What's more likely, should your business succeed, is that growth may well accelerate but not more than is copable with. The trick is to architect your service so you can rapidly scale it, then it just becomes an issue of cash hardware. If you've got your business model straight then this shouldn't be a problem.
So, home grown for me. It's not hard or expensive these days with so many open source services and stiff competition in the ISP market; and I haven't even got onto the perils of locking your pride and joy to a proprietary app hosting architecture.