SSDs have become fast, except in the cloud

This was a huge technical problem I worked on at Google, and is sort of fundamental to a cloud. I believe this is actually a big deal that drives peoples' technology directions.

SSDs in the cloud are attached over a network, and fundamentally have to be. The problem is that this network is so large and slow that it can't give you anywhere near the performance of a local SSD. This wasn't a problem for hard drives, which was the backing technology when a lot of these network attached storage systems were invented, because they are fundamentally slow compared to networks, but it is a problem for SSD.

Why do they fundamentally need to be network attached storage instead of local to the VM?

They don't. Some cloud providers (i.e. Hetzner) let you rent VMs with locally attached NVMe, which is dramatically faster than network-attached even factoring in the VM tax.

Of course then you have a single point of failure, in the PCIe fabric of the machine you're running on if not the NVMe itself. But if you have good backups, which you should, then the juice really isn't worth the squeeze for NAS storage.

A network adds more points of failure. It does not reduce them.