Cost is the big one, If you can manage your own metal you can save a LOT. 50K AUD of gear would cost us ~ 10x PER YEAR for the same VM sizes (many are 32gb of Ram, 8+ vCPU, reasonable IOPS).
IP addresses is another. AWS gives you 5 before you have to start applying for them. We do email marketing, so we need a lot of IPs (we give dedicated IPs to each customer). With APNIC (Asia Pac) we have a /22 and a /23 range (1536 IPs) for ~ $2900 per year.
Legal reasons are a whopper as well, Australia has some tight laws around privacy and liability if an overseas partner leaks your data.
We still host a lot of things on cloud providers (Rackspace & AWS in both Sydney and US) sites, but at the end of the day our VMs out perform cloud VMs and are considerably cheaper.
Let me also say that comments about vm size on EC2 almost never consider that bare metal performance can be magnitudes better.
If you can build a redundant system, and don't need the extra 99.999999s of hardware resilience, but can have 99.995 network uptime, dedicated is great.
I would argue that dedicated servers are MORE resilient then any cloud provider. And it really isn't that hard, 2 enterprise class servers + VMWare or similar and you have a HA cluster. The hardware support is largely done by the hardware vendor under their support contract (4 hour mission critical) and having redundancy means a single hardware failure isn't critical.
I have had 4x 1 minute dropouts in the past 18 months from our hosting vendor upgrading their routers always at midnight localtime. They provide diverse data paths and we have not lost connectivity despite major outages. If I thought I needed to I could get a separate connection from one of about 20 providers in the local DC I am located in.
I really believe many people put too much weight on the complexity of managing physical hardware, when your already doing 90% of the administration anyway on a cloud server. Yes it is capital intensive, but you will likely make the money back in your first 12-18 months.
This is exactly what we do and it has worked out well for years. You can also defer the upfront capital expenses by finding an IT vendor that is willing lease or rent the equipment for a fairly fixed monthly cost.
IP addresses is another. AWS gives you 5 before you have to start applying for them. We do email marketing, so we need a lot of IPs (we give dedicated IPs to each customer). With APNIC (Asia Pac) we have a /22 and a /23 range (1536 IPs) for ~ $2900 per year.
Legal reasons are a whopper as well, Australia has some tight laws around privacy and liability if an overseas partner leaks your data.
We still host a lot of things on cloud providers (Rackspace & AWS in both Sydney and US) sites, but at the end of the day our VMs out perform cloud VMs and are considerably cheaper.