These days I can't read The New York Times' strong opinions without shaking my head sadly. Then I turn to its editorials.
On-demand CRM may be a less-expensive risk, but it's just as big a risk. If you haven't planned everything out, customers will get lost. People will get fired. You will fail.
You might hear a song you like on 'Desperate Housewives' and automatically download it, watch the video, send it to your handheld device and burn it to a CD. All those things are possible in the fairly near future.
The cultural disintegration at Oracle is pretty substantial. They haven't even been able to integrate PeopleSoft yet.
It's not that on-demand software can't integrate. It's just that the integration tools in traditional on-premise software are better. The more complex the integration requirements, the better off you'll be with onsite software.