When Startups Grow Out of the Cloud

Cloud computing has been a boon to tech startups, allowing them to build, launch and scale without substantial up-front investment in hardware. But at what point does the moving from the cloud to a data center make more sense - for both performance and cost?

Facebook announced plans earlier this year to build a custom data center in Prineville, Oregon, and Twitter announced last week that it plans to build one near Salt Lake City, Utah. And web app maker 37Signals isn't building its own data center, but it did reveal last week that it will move its infrastructure from Rackspace hosting to a colocation space in a Chicago data center.

As Jonathan Heiliger, Facebook's VP of Technical Operations said at last month's Structure 2010 conference, "For a consumer web site starting today, I would absolutely run on the cloud. It allows you to focus on building your product. But if you have 10 million users, that's a pretty big check I'm writing to someone else. How much control do I have?"

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