Perhaps you've heard the buzz, but cloud computing is becoming a defacto way of getting things done with your computer. Don't know what cloud computing is? The high level idea is simple: forget about storing your data locally and running software on your own computer. Instead, store your data and run applications online (in the cloud). Google's GDocs office/productivity software is a stereotypical example. With GDocs you can create and store office documents (word processing, spreadsheets, slideware, etc) online. The desired outcome from the "consumer" standpoint is that you're no longer tied down to using any particular computer. You can access your data and run your applications from any web browser connected to the Internet.

Before you up and attempt a full migration into the cloud, I think there are a couple things you should first consider:

1. Do you trust the organization that is storing your data more than your own local hard drive and backup solution? Do they backup their data regularly? Are they suddenly going to dissolve and disappear with your data in tow? Can you pull the data down to a local machine should you decide to move it elsewhere?
2. Are you satisfied with your data server's security arrangements? If you can get to that data remotely, others might find ways to get to it as well.
3. Lastly, if you use software in the cloud, are you satisfied with the possibility that it too might go away once you stop paying for it or if the organization that is providing it stops doing so?