It's interesting to think about the pros and cons of school-hosted versus web-hosted learning management systems.
Most schools currently host learning management systems on their own servers, which requires a dedicated IT staff, backup system, and other related overhead. Blackboard, Moodle, Desire to Learn and other such systems are usually deployed this way.
The pro to this approach is that the student's grades are located on school computers, which gives the school a sense of security. The cons are that the school has to spend money on servers and an IT department. In addition, the student data is probably less secure than in a web hosted environment because it's a lot easier to break into a school IT room that into a remote data center.
The last paragraph enumerates the traditional arguments for and against web hosted systems. However, I think that an even bigger pro of using a properly architected web hosted system is that it allows the student's e-learning portfolio to be owned by the student rather than by the school, thereby allowing the portfolio to stay with the student as he/she moves between schools.
Amazon tracks my buying portfolio regardless of where I live; shouldn't a learning system track an education portfolio regardless of where a student is learning?