Storing a file in a database as opposed to the file system?

Generally, how bad of a performance hit is storing a file in a database (specifically mssql) as opposed to the file system? I can't come up with a reason outside of application portability that I would want to store my files as varbinaries in SQL Server.

Have a look at this answer:

Storing Images in DB - Yea or Nay?

Essentially, the space and performance hit can be quite big, depending on the number of users. Also, keep in mind that Web servers are cheap and you can easily add more to balance the load, whereas the database is the most expensive and hardest to scale part of a web architecture usually.

There are some opposite examples (e.g., Microsoft Sharepoint), but usually, storing files in the database is not a good idea.

Unless possibly you write desktop apps and/or know roughly how many users you will ever have, but on something as random and unexpectable like a public web site, you may pay a high price for storing files in the database.

If you can move to SQL Server 2008, you can take advantage of the FILESTREAM support which gives you the best of both - the files are stored in the filesystem, but the database integration is much better than just storing a filepath in a varchar field. Your query can return a standard .NET file stream, which makes the integration a lot simpler.

Getting Started with FILESTREAM Storage