Not referring to militaries or governments, but for other organizations or shops that needs an IT infrastructure (who doesn't nowadays). Similar to this question, but purely in regard to hardware and/or services, such as servers, storage, email services, etc.
I don't imagine it's cut and dry for every org, because every organization is different. Should they consider:
Size of the org and what resources are required
Whether or not the org has in house IT support
Recurring cost of replacing hardware vs. hardware 'subscription'
Of course there are security concerns, such as 'Is this service from
<provider>compliant with<security standard>If going with a hosted option, what's the exit strategy if all of a sudden the agreement can't go forward, for whatever reason.
Options for backups, with either choice.
There's of course more to consider than just cost. I ask this because you have small 1-2 employee shops that need services such as email or file services, all the way up to huge organizations, but those huge organizations aren't IT shops, their production may be basket-weaving or something, should they invest in a private infrastructure to host their basket-weaving drawings, documents and the like? How is that a value add for them?
Update
Not necessarily cloud, colocation is an option as well.
I've heard of someone running a small business off an ipad. I've talked to someone else who's very interested in possibly colo-ing SQL for their one person company.
To answer your specific question: No, the basket weavers shouldn't buy a server to store their basket drawings. They should use a file cabinet.