* Lock-in. Without the flexibility of cloud-delivered applications, your organization might be locked into a rigid software/hardware stack that will be difficult to change. The new versions of commercial software might not run on your legacy hardware. And new applications you build in-house might not be able to accommodate new demands if they're running on old hardware. Why are you paying utility bills for your data center and support contracts to run that hardware if it can't meet your business needs? Why not move Capex to Opex (operational expenditure) where you can?
* Missing Out on the Cloud Brain Trust. When you move your applications to the cloud, you don't just save money and management hassle. You also get the benefits of the expertise of cloud service providers, people whose sole job it is to run data centers and support applications, day in and day out. That means relief from the daily grind of patches and upgrades, but it also means a window into an exciting future. Work with a service provider with the expertise to teach you how to leverage the latest technologies in a way that enhances your competitive advantage.
* The Scalability Ceiling. Even if you virtualize your application and run it in your own data center, you'll save space but have limited scalability. That could be a significant problem if you run an online store and suddenly an item becomes popular. In the cloud, you can "burst" into practically limitless capacity, and then scale back down when you no longer need it. A large insurance company customer pursued this strategy when it had a big hiring event; the company spun up dozens of servers to support the event, and then spun them down again. Amusement-park operator Six Flags uses the cloud to manage huge traffic bursts in online ticketing during the peak summer season. Neither company could do this without the cloud.
* Lack of Self-Service. Virtualization is complex and requires a high degree of centralized control, which means business users can't just "virtualize at will" and provision their own resources. But in the cloud, they can, and that saves IT time and money while empowering the business.
* Remaining in the Infrastructure Business. Although virtualization provides cost savings, it still obligates your enterprise to remain in the infrastructure business. IT still has to acquire, manage and replace that hardware, as well as apportion servers, administer change requests, and apply patches and upgrades. In the cloud, IT is freed of that responsibility and can focus instead on new, innovative applications and technology that make the business more competitive. New applications can be developed using newer techniques, like DevOps. The cloud provides the flexible infrastructure you need to support that Agile approach to application development.