Meanwhile, vendors are in what one provider calls "education mode," explaining to CIOs, IT managers and other IT buyers that they can save a lot of money by floating their data in public and private clouds.

The one thing both groups seem to agree on is that cloud storage will eventually take off. After all, it's technically feasible, it's cheaper than traditional data storage, and it's becoming more and more secure.

"I look at cloud adoption a little like I look at Linux adoption 10 years ago," says John Engate, chief technology officer at San Antonio-based Rackspace Hosting Inc. "Adoption didn't happen overnight. It came in the back door. The system administrator or developer who did work on the weekend brought in the Linux application he built and showed it around on Monday like a science project. It took a while for people to realize it's a viable way to do things."

Cloud storage is a lot further along than a science project. But is it right for part, or even all, of your organization's data? Here are answers to five key questions that will help you decide whether you should head for the cloud.