One of my biggest qualms about recommending a cloud-based solution (esp for sensitive data) is that the solution is then completely bound to hardware under a particular vendor's (e.g. Microsofts or Amazon's) control. This in turn makes it hard to sell to clients who typically like to have complete control over their data (whether this concern is well-founded is another debate).
Last month, Microsoft made moves to circumvent this reaction by announcing an "Appliance" - which is a specially configured box that will be able to be purchased for use in-house. Costs have not been announced - and it is only available to be used by a select pilot customers (in a "Limited Production Release") like Dell, Ebay, HP and Fujitsu.
However, it is a move in the right direction - to making the Azure business model appropriate in more business contexts - and without the variable (and somewhat unpredictable) expenses normally associated with a cloud-based (or any transaction/CPU cycle/storage fee-based) solution. Yet they still retain many of the seamless scalability advantages offered by Azure.
For more details on the Azure appliance, see:
http://www.microsoft.com/windowsazure/appliance/
DDK
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