Floating along on the Cloud?

Cloud computing has exploded in recent years. But why would that be the case? What are the benefits, but also the specific associated risks

The Cloud in a few words

In a certain sense, the innovation of Cloud computing harkens back to the “prehistoric” information technology represented by mainframes, those large central systems of the 1960s.

For both of these technologies, the principle is to shift the calculation power and storage resources to remote servers. In the case of the Cloud, the IT resources are accessed via the Internet, and the ergonomics are much more advanced than was the case with the old monochrome systems.

In other words, “the intelligence is no longer within the user’s workstation, but available over the Internet”.

The Cloud appeared in the 1990s and has developed unceasingly since then. So much so, that in 2013, worldwide expenses for Cloud services were estimated at $47 billion, with the expectation that they will reach $108 billion by 2017.

Technical and financial adaptability

Despite the initial hesitation of companies with regard to seeing their strategic data move outside of the company, Cloud computing has developed extensively because of its benefits.

Indeed, applications hosted within the Cloud can be accessed from any Internet browser: rolling out software programs to user workstations is no longer necessary, IT resources (applications and data) can be made available from anywhere and eventually from any peripheral device (tablets, smartphones, …).

Moreover, Cloud services are generally available for rental, meaning that companies can adapt their needs (dropping or adding new applications, changing the number of users, etc.) and their resources each month. There is also no initial investment, often considerable, that has to be anticipated when acquiring a stock of servers, and usage costs are calculated according to the level of consumed resources.

Finally, all or part of the administration, maintenance and even update operations are delegated to the Cloud’s depository companies. These companies are capable of deploying the very latest IT skills, that their customers would doubtlessly not be able to afford in-house.

The Cloud, an ideal solution?

This list of benefits would be enough to convince many people that the Cloud is an ideal solution for meeting corporate IT needs. This may well be the case, depending on one’s expectations and provided that attention is devoted to certain points.

Firstly, a Cloud hosting contract will systematically exclude the consequences linked to service downtime due to a failure of the transmission networks needed in order to access the applications and data. The service provider’s liability could potentially only be pursued if this party is also the provider of Internet access services.

In any event, for operational considerations, user companies must therefore ensure the quality of their connection and, depending on the critical nature of their business line applications, must make provisions for a backup line that will allow for operations in downgraded mode.

Also, the Service Quality Level provided by the service provider is defined in the SLA (Service Level Agreement). The duration and maximum percentage of any downtime over an invoicing period are generally stipulated therein. Failure to attain the SLA must require the service provider to pay penalties.

Like any servers classically hosted within a company, the Cloud is still made up of hardware that can suffer failures in addition to attacks (denial of service, ransomware, etc.)

In all cases, it’s important to determine whether the Cloud contract has been signed directly with the host, or through an intermediate reseller. In case of an incident and depending on the clauses limiting the liability of the host or reseller, recourse can prove to be more or less complicated.

No one solution is better than any other, but it is important to understand the contractual layout in order to ensure that it suits the usage situation. In particular, it is crucial to clearly identify the process and actor in charge of backing up data: User Company (some Cloud contracts stipulate that purchasing a backup service does not release a company from having to regularly backup its own data), reseller, and host. Cloud or no Cloud, losing data and the unavailability of a backup represent a major loss for companies.

To sum up: the Cloud yes, but not cloud 9.

 

Olivier Gévaudan
NTIC risks loss adjuster, GM Consultant Group