I run a datacenter, so yeah, we do it all in house. The main problems for me are - security, reliability, network. Using a VM/VPS type system basically elimina

I run a datacenter, so yeah, we do it all in house. The main problems for me are - security, reliability, network. Using a VM/VPS type system basically eliminates any security you might have, there are currently too many ways to have your data stolen/intercepted/manipulated/disconnected for it to be safe. Using a "hosting environment" aka PAAS is actually one of the best ways to maintain availability, however your security is even more compromised. If I were to pick a VPS/etc environment I'd go for Rackspace because they've got a better backstory than Amazon does, and they seem to be a bit more interested in protecting their customers.