I have used cloudinary with rails and found it to be a much better alternative than paperclip or carrierwave or using image magick. Storage and speed wise its as good as any other CDN. Another big win for cloudinary is that its one stop solution for your image transformations and storage.
Probably the one limitation is that you can only make upto 500 API calls/hour in free tier and upto 2000 calls/hour in basic tier. This might be an issue for larger apps.