In the past I have worked in a place that had around the same problem as you say.

I had a very small budget, so I was hosting services on commodity PCs, with outdated systems, no virtualization (no dual cores back then), with as much as 3 to 4 services running in the same machine with no kind of sandboxing.

All was running fine.

Then, I got a small budget to buy a newer system. It was a Dual Core system, and I managed to get two hard drives which I put on simple mirroring RAID (low storage was the main problem that allowed me to buy new hardware). That's when the problems started arising.

I was young back then, and was seeing all the "good stuff" around to speed up machines, so I fell for that RAID thing, since it supposedly would almost double read time and automatically create backups. It ran fine until some weeks after I set it up, when some files simply "vanished" from the file server. Nobody knew where they were. I didn't know where they were or what happened, but since we were small, most files were stored in the users' workstations (even though that was not "a good practice (tm)"). Because each user had its own backups locally, we managed to get going without the files.

Then it happened again. Many files went missing again! But this time I noticed that some files (that vanished in the first incident) appeared again, and the missing ones now were the newer ones added after the first incident. So, I naturally traced it to the raid array and noticed it wasn't in sync. Then I saw that it was not mirroring correctly, and at each boot of the server the active drive could be "swapped".

In the end, I chose the simple path: I disabled RAID and used cron to daily backup from one drive to the other in the end of the day. Problem solved, everybody got happy. From what I've heard, this setup hasn't broken again (since nobody dared mess with it after I left). Lesson learned: follow Occam's razor ("The simplest answer is usually the correct answer."). By the way, as far as availability is concerned, all I had to do would be to get one of the drives to another machine and boot up, as I could do when a lightning fried the motherboard even with correct grounding and UPS.

I think most people will stick with OS X and proper iPhones.

There... Fixed that for ya.

I think most people will stick with Windows X and proper GNU/Linux netbooks with pirated Windows X.

There... Fixed that for ya.

Yet, most people don't get it. Historically, the main motivation for the birth of the internet was specifically to avoid the dreaded Single Point of Failure. What we see in the cloud concept is exactly the opposite. The cloud can (and statistically it will) eat your data, along with everyone's else. What if a whole contry's data infrastructure is in one failed cloud?

Do you trust one company to be better at handling YOUR data than yourself? Do you trust it will never be hacked? Do you trust it will always be online? Do you trust nobody will access it without your consent?

I don't. You shouldn't.

Also, what happens when you get without internet access? What happens when power is out? (my laptop can run for two hours on battery, my router won't)
What happens when the three-strikes law passes? Not if, given current state of affairs. Will you be locked out of all your data? What when you put all your family HD movies in the cloud, will you need to have fiber to watch it with good quality?

Also, economically that's a catastrophe. The cloud will maintain some companies basically with a monopoly on YOUR data. It will destroy the whole industry based on standalone software. Don't be mislead: you WILL have to pay to get even the most basic software running. Many companies already do that with auto-deactivating software. The cloud will only make it easier.

And for those who think the comment above looks like some doomsday dark sci-fi story, I advice to take a look around. Things are already happening. One doesn't have to dig deep to find news of what's already happening.