Starting with TFS 2012 we are now faced with the options of using either Team Foundation Server or Team Foundation Service as our ALM platform of choice. The big question is which one to choose. One is installed locally while the other is hosted in the cloud. This is an important difference but not the only one. I’ll list the most important points to consider here.
If for some reason you are not allowed to handle your work items or source code in the cloud then Team Foundation Service is out of the question as it is based on Microsoft’s Windows Azure platform.