Why Infrastructure As A Service Is A Bad Deal – Cloud-computing – Infrastructure as a Service – Informationweek:

Here’s my bottom line: The fundamental value of IaaS is flawed, unless you need it for cloud bursting or a similar seldom-used application.

TL;DR utilizing 50TB of storage on Amazon in 2006 (for four years) cost ~$1mil all inclusive of fees, and equivilent on premise storage cost approximately the same. In 2012, Amazon still charge north of $500k but on premise is $100k.