What are the pros and cons of using cloud tools vs. local infrastructure for small group (8-15) storage, source control, and information management?

Pro: Your team is not tempted to dink with a local server, because they can't. Con: You have a one-size-fits-all environment, and can't install random local hooks, cron jobs, and stuff.

As a matter of full disclosure, I work for a managed services/cloud provider. In modern times, the pros seem to far outweigh the cons for smaller environments. Pros No upfront capital investment Infrastructure is expensive to buy, especially if you are a smaller house with little leverage in the way of discounts. Using a cloud computing based environment means that there is no such capital expenditure.  This capital expenditure is replaced by operational expenditure where large-scale (even hyperscale) providers who can get large discounts are providing the infrastructure.  These discounts are, in some part, passed to the customers. A right-sized and appropriate environment, always Right-sizing an environment usually has the architects erring on the side of caution, building an environment that is much too large.  Shrinking such an environment finds infrastructure/tools being unnecessarily repurposed or worse, not used.  Cloud computing environments allow the environment to be grown or shrunk, ripped and replaced, as needed without the need to buy superfluous infrastructure. Reduced operational overheads The largest proportion of expenditure on infrastructure is not so much on the hardware and software, but on overheads such as power, cooling and maintenance for the infrastructure.  Managing this can also be difficult. Cloud computing providers manage this for you, and typically run a more efficient operation.  These costs will, again in some part, be passed to you.  Reduced people costs Because cloud computing environments have lots of people managing lots of infrastructure for lots of customers, they get economies of scale, over an infrastructure or service operations team who may, for some proportion of their time, be sitting around doing nothing.  Again because these operations staff are being optimally used, there are additional savings that are passed to the customers. A highly talented team that manages massive numbers of customers as their day job As well as the reduction of operational costs, cloud computing providers have great talent at their disposal which specialise in the sort of infrastructure/services they manage.  The chances that you are going to have as much great talent across a wide set of specialisms at you disposal is quite unlikely. These teams are responsible for constructing, maintaining and securing infrastructure that is just mindbogglingly vast which has them building automation and optimising to reduce the noise. Continuous innovation Cloud providers, because it is their core business, can innovate at tremendous pace, and pass those innovations to you very quickly. Typically, because of hardware and licensing cycles, being able to chop and change an internally managed infrastructure at the rate that cloud providers will allow you to is simply not feasible. Cons Location of data Cloud computing providers are not often completely transparent about where they store the data.  This can be problem if sensitive data is being stored outside of a jurisdiction and gives certain authorities that you wouldn't otherwise want to have access to your data.  Regardless of the jurisdiction the data is stored in, it is stored on infrastructure that is not in your immediate control and therefore access to it can't be completely governed by you. Connectivity In order to get access to your cloud infrastructure, you will be completely dependant on your wide area connectivity, whether this is public (i.e. Internet) or private (Ethernet, MPLS, Site-to-site VPN ec.). Typically this connectivity is provided by a 3rd party. If your connection goes down, so does your access to your environment.  If you have access to your infrastructure on premise, you are less reliant on a third party to maintain access to your connectivity. Security Cloud computing providers are considered to be less secure because you don't have control of perimeter security and because the immense surface area protected by this perimeter security means a greater prize is at stake for malicious entities.  It is arguable that this is paranoia, due mainly to the resources that a cloud computing provider can throw at building an appropriate security infrastructure which is unmatchable by all but the largest of enterprises.