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For Mac OS X, what criteria should I use to decide whether to store a document or file in iCloud or on my local machine? What are the tradeoffs and considerations to be most aware of?

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iCloud document storage is best used for documents you're going to need to access for things that you're likely to need in a single application, but on multiple Macs. If you're likely to need to access a document from in multiple applications, or don't need it synced between multiple Macs, local storage makes more sense.

The documents you store in iCloud from a Mac are essentially tied to the application you save them with. For example, if you create an image in Photoshop and save it to iCloud, you won't be able to later view it in something like Preview without first opening it in Photoshop, then copying it to another location that Preview can access (either local storage or in Preview's iCloud storage).

The iCloud vs. Reality section of John Siracusa's Mountain Lion review on Ars Technica goes into good detail on this as well.

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Thanks for the answer! Yes, I've read Siracusa's review. It would be wonderful if the decision was that simple, but unfortunately there are some additional issues that make the decision more complex. For instance, iCloud does not support more than one level of nesting of folders. So, if you have a lot of documents and files (so many that one level of nesting is not enough to keep things organized), presumably iCloud may not be a good choice. Is there more? –  D.W. Jul 29 '12 at 20:20
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Well, I think ultimately you've got to decide based on what your needs are. Personally at the moment I don't find the iCloud document storage on the Mac very compelling - it has more restrictions than local storage, and most/all of the benefits can be gained via Dropbox. Really the biggest benefit is the simplicity - it's geared towards people who aren't all that comfortable with the file system or something like Dropbox. If you're reading Siracusa's review, it's probably not for you, try Dropbox instead. That's not to say the other elements of iCloud aren't useful of course. –  robmathers Jul 29 '12 at 21:43
    
Thanks, that is very helpful! I appreciate your time, @CanuckSkier. –  D.W. Jul 29 '12 at 21:52
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