a)A program that is in your own servers - computers. b)A program that is on others computers.
So difficult to understand why people trust A more than B. Whatever they promise you, they can look at your data if they want, not so easy in A.
E.g The NSA have the option to see whatever they want in the USA, they have it so easy to do industrial espionage against other countries(they did it with airbus, with national security excuses).
Google can't say no to NSA. Microsoft either(they let them put backdoors in their software), but is not so easy.