There are so many old (and frankly even new) line of business applications, where the developers haven't considered among other things laws of physics like spee

There are so many old (and frankly even new) line of business applications, where the developers haven't considered among other things laws of physics like speed of light in optical fiber much. These systems (client+server applications) tend to run much better on premise. The applications are often not automated much, aren't really secured that well (so you would probably need a VPN to the cloud to run it safely) and the bandwidth of internet connections at some of these companies are not really suitable for clients on premise and servers in the cloud anyway. You are lucky, if the synchronization to a different location works well enough. Also, cloud is very costly if you don't use the up and especially down scaling because your application/ infrastructure wasn't really designed for that. Also if you buy some new machine for the factory it usually comes with software (usually MS Windows Server + MS SQL Server + some machine control software) that has hardware requirements that don't really fit well with cloud pricing. Such machines tend to run for decades and the company certainly hasn't thought about being efficient with computing resources on the server. On premise hardware isn't that costly if you consider these factors, if the supplier cannot secure the machine properly, you slap it into its own VLAN and write an ACL for the RDP access (because that is how it is) and are done with it. Basically dedicated Gigabit speed with very little latency for any communication between the clients and the server. Remember, you are almost lucky if a Windows Update doesn't break the software/ software license on the server or the client...