Speaking as a guy who spent a decade in the hosting industry, unless security and privacy are core services you provide that your customers pay you for, I would wholeheartedly recommend the cloud. Maintaining your own infrastructure, fighting the daily fights against intrusions and DDoS attacks, upgrade and version control management, not to mention recruiting and staffing and overhead costs - all these are expensive and complicated. Significant ROI needs to exist to justify taking them on.
By the way - it's not necessarily a binary solution, there's a spectrum. You can manage your own datacenter, co-locate your own hardware in someone else's datacenter, hire a service to manage power/pipe/ping and essential services on your own boxes (while using your own people to manage your applications and data), or even get into a shared environment where you share the cost of everything with other businesses. Cloud is just one possible solution.
I can only speak for my experience working with the SMB community. I think, all things being equal, most organizations would prefer to keep their data as close and protected as possible. There is the risk/reward equation between having everything in one place onsite, which is more secure but risky. In the cloud, at least there is the ability to recover from a remote location, but there's the cost and as you mention, the possibility of unwanted eyes getting access. And there's the choice between using a public cloud provider and building your own "private" cloud, which would be way more expensive... a lot to consider.
I think you answered your own question looking at your comments. Storage is very inexpensive now. If protecting intellectual property, trade secrets, customer data, etc. is a concern store and secure it yourself. Depending on the volumes you have you might consider a hybrid approach OR store the primary data yourself but use the cloud for encrypted backups. This would get the data offsite for DR purposes and eliminate the need to backup to disk and store disks somewhere secure and remote. If you choose to go cloud route read the SLA's very closely and find out how company backs up your data and how you get your data back if you want to change vendors and the costs involved. There are many more considerations but I think those are key ones to consider. p.s. typically with free (or near free cloud storage) you get what you pay for.
I'd ultimately prefer a concept with both (like Dropbox). The cloud gives me the flexibility to easily view and edit my files across multiple computers and helps me in case of computer failure. Local/personal storage ensures I'll have a copy in case the cloud loses my files, etc.
If I had to pick one, in terms of pure experience, I'd go for the cloud. It's more reliable than any computer I have (at least with sites like Dropbox, Google) and the ability to seamlessly use a file on multiple computers/devices is awesome. The only caveat is whether the cloud provider is reliable or not.
Why keep the maintenance of the storage? Let someone else do it in the cloud! Make sure you have security features available to ensure the integrity of the data for loss prevention and access control.
If all things are equal, (Or not), I would still go with personal storage.
At the risk of sounding paranoid, with my experience working with organisations of all types and sizes in the last two decades, security and privacy are major concerns. Especially when working with ultra-sensitive documents and information.
The cloud has its advantages, and as an early tester/adopter, I am still not really content with the security offered by most cloud services. Even though the advantages of the cloud services, be replicated in personal storage through implementation of several technologies, the investment for doing it is steep.
Speaking from the point of view of our company we have recently moved everything from our server to Microsoft Office 365, incorporation SharePoint and our own individual and shared SkyDrive accounts. As long as there is security in place to protect your data, and the data centre in which it is stored complies with your local laws you should be fine. Leave the maintainence of the infrastructure elsewhere, and there would be no big bills or loss of data if your own server goes down. I would still recommend that you back up your data unless your cloud provider offers some form of guarantee against loss of data.
it depends mostly on the type of data and the relative value that it creates for your organization. in general I would say that petty stuff you may want to have it in the cloud. critical stuff you better keep it at home if the cost is reasonable.
Technically though, IMHO, there is no question, go cloud. Administering IT infrastructure is only fun if you are a geek.
I would definitely use the cloud. I use dropbox to store all of my design work and i have a folder called portfolio where i load my designs and when I'm in a meeting i can pull up that folder and show my potential client work I've created.
I also had a crash a few years ago and lost 2 years worth of design work because i had my artwork stored on my hard drive so that caused me to search for a solution that is cloud based.
If you are concerned about security with the cloud you may want to check out LogMeIn's new offer of Cubby. It works a lot like Dropbox but allows for file encryption. https://cub.by/i/00_V0WmhdGGOAe