"The cloud" refers to servers that are accessed over the Internet, and the software and databases that run on those servers.

Cloud servers are located in data centers all over the world

Phyisical solutions may give the advantage of speed and support. But the advantages of cloud crosses the limited time bourndary for that support. Another advantage would be your indefinite back up which can be accessed from the time you have a cloud service. The list advantages just go on and on...