It's a stepping stone for some companies. For many others, it's not (e.g. Netflix, Heroku). I see a false dichotomy here: start off with the cloud, then move t

It's a stepping stone for some companies. For many others, it's not (e.g. Netflix, Heroku). I see a false dichotomy here: start off with the cloud, then move to bare metal servers. If you've got an OLTP database that demands high-performance, you may need bare metal. Many companies don't, though. I've been a consultant to companies who've over-extended themselves on EC2 and ended up with huge monthly bills they didn't anticipate; in every instance, it was because they hand-built servers, cloned them, and then hand-modified them. The result was a set of servers they would like to be able to destroy (when they didn't need them) and then respawn (when they did), but couldn't because of the modifications. So, yeah, you can get in trouble with cloud services. But that doesn't mean you can't use it cost-effectively on a permanent basis. Like anything else, it requires planning. Switching to bare metal? Sure: as hypervisors to your private cloud. Projects like OpenStack, an EC2 clone supported by Rackspace and Red Hat (among others) make it straightforward and compelling to virtualize your environment. edit: content