Cloud Computing & The Forgotten Legal Aspects

With all the hype (technical & marketing) around cloud computing the business risks of the cloud often get overlooked - especially the legal aspects. We've heard about the big benefits:
- access from anywhere with an internet connection
- minimizes capital investment (hardware, facilities, etc.)
- potential for quick scalability (if applications are capable)
- temporary computing capacity (staging, development, DR, migrations)

Most of us in the industry also know about some of the security risks (CIA) associated with cloud computing too. An example of the availability risk recently occurred on August 6th, 2009 when Twitter, YouTube, and LiveJournal were all impacted by a DDoS attack (see NYTimes article). Unlike some of these areas, the legal implications of the cloud are still "To Be Determined" (TBD).
What are some of the legal areas that need to be considered when you begin to seriously consider Cloud Computing for your enterprise?

Jurisdiction: How do you determine where the data is being stored? This is important because it will determine what courts have jurisdiction and what law governs the use and treatment of that data.

Privacy: What legal access rights do law enforcement organizations have over personal information stored in the cloud? Remember that privacy laws vary considerably between countries and also between states within the US.

Licensing and Contractual Issues: What controls are in place for fee increases and service levels. How do you transfer from one cloud provider to another? (Are you locked in to a technology if your utilizing Microsoft's Azure or Google's App Engine?) What intellectual property protections are in place for the solution, the stored information, the hosted applications, etc.

I'm not suggesting these legal issues are important to everyone, or even enough of a reason to avoid the cloud in it's current state. What I am suggesting is, you want to be sure and consider these areas and understand the risks involved for your organization before you decide to jump on the cloud computing bandwagon.

Don't be Another Statistic!

Small Business Cloud Computing Value

I've been following cloud computing (in the loose marketing sense of the word) for the last 18 months or so. There's quite a bit of conversation in the press, IT circles, with friends and colleagues about the merits of the "cloud" and when it's best used and how. I am of the mindset that it makes sense depending on the circumstances (what every IT consultant always says right).

Over the past 18 months I've been lucky enough to have the opportunity to work on\in two start up companies. One of the items I've learned from this experience is cloud computing (application hosting variety) provides a great advantage to small business, which were unthinkable 3+ years ago. The advantage it provides is the opportunity to leverage the same type of business processes supported by technology that in the past only the medium to large enterprises had the scale and money to utilize. 3+ years ago, how many small businesses could have CRM, HRIS, email, website, telephone systems, and ecommerce functionality? Because of cloud based computing and application hosting, small businesses can utilize the technology that in the past only the bigger companies could afford. And they can do this without paying computing professionals to manage computing infrastructure every day.

The services are wide ranging - but here are some of the services I've used for free or very little cost:

CRM - Everyone knows about salesforce.com but Zoho CRM is my preference at the moment. It's free for up to 3 users and provides lead generation forms that can be integrated into your website along with basic workflow all for free.

HRIS (Human Resource Information System) - Zoho People provides a nice employee portal and HR management (application tracking, vacation requests, etc) system that is free for up to 10 employees. It allows you to integrate an application\profile submission process into your website along with basic workflow all for free. Zoho also provides an online testing tool that could be used to test potential candidates via the web - they call it Zoho Challenge.

Phone System (PBX\Auto Attendant) - My favorite in this space is Grasshopper (previously gotvmail). Using their system allows you to have a toll-free number with an answering machine on steroids. While they don't offer a free plan, they have pricing plans starting as low as $10/month. This is a great deal when you consider a system that offers this type of functionality would cost at least $10k to implement and $2.5k a year to maintain.

Document\File Share (file server) - There is a lot of competition in this space that comes in many varieties from the likes of big players like Microsoft and Google - along with Zoho who all want you to use their applications for your work. I find that people like to use their preferred tool for documents (MS Word, Open Office Writer, etc), presentations, spread sheets, etc. so I like to use a storage platform that doesn't lock people into a set of tools. My favorite tool here is called DropBox. It stores your files in the "cloud" while representing them as a local directory or directories and it allows you to manage who can access the files and directories (you can share them with people by just using their email address). And a side benefit is you don't have to worry about setting up a backup schedule!

Email\group calendaring\website - What business can survive without email and calendaring today? There are many free providers today - Microsoft and Google are the first that come to mind (Google for businesses isn't free anymore - $50/user a yr). I prefer Google email and calendaring (Gmail for organizations) because it's free and offers the right technical functionality for the price (biggest being IMAP access).

podcast hosting - If you use podcasting in your business, you can't beat libsyn for hosting of the podcasts for around $10/month.

There are many, many other areas and applications I could\should cover but I will end it here for now.

The main point here is if you're a small business, you have more tools available to you to help you serve your customers! And if your considering building your own infrastructure or upgrading it, WHY? Here are some simple numbers to think about when you begin to think the services outlined above are too expensive and you can do it yourself cheaper.

Cost of power for a computer per month: ~$20

Cost of a computer hardware per month: ~$17

Cost of 1 hour of computer support: ~$75 **

Total cost for a month: ~$112*

*not including cost for internet access because you'll likely need to have it regardless of your decision.

**assuming you only need 1 hr of assistance a month - which is really conservative

Here are some posting that cover what google apps you should use from a marketing\web perspective that are valuable:

Which Google Products Should A Small Business Use?

Which Google Products Should A Small Business Use? (Part II)

Windows 7: Enterprise Features Add Value for IT?

A recent article on CIO.com outlined some of the enterprise features that Microsoft product management believes Windows 7 provides. After reading the article and some of the posted comments I wanted to outline my thoughts on the features mentioned in the article and how they could have a positive impact for enterprise IT.

While I don't drink the MS kool-aid, I believe there are some advantages to the Windows 7 release for enterprises to consider.

For enterprise level endpoint OS management, MS has the most mature stack out there. If you're a doubter, look at how Red Hat and SUSE are playing catch-up on the Linux enterprise management front and Apple on the Mac front. Because its a mature stack you will likely continue to see incremental improvements as opposed to ground breaking advances. (the reality of mature products)

The incremental security functionality provided by BitLocker to Go and AppLocker, if it's not administratively burdensome, will help IT organizations to narrow the threats introduced by end user ignorance of maleware\spyware (which according to some security surveys is the #2 security incident within enterprises) and their propensity to leave intellectual property unprotected (especially when traveling - mobile device theft is the #3 most often occurring security incident). DirectAccess could help to protect the corporate network\infrastructure from the proliferating use of open WLAN access points that enterprise employees utilize when working remotely. If BranchCache improves MS's implementation of DFS (which still isn't ready for enterprise use), it could help to eliminate the capital outlays required for WAN acceleration and\or WAN bandwidth. All of these features, if they work well, could result in real capital savings for IT organizations. Desktop search - we'll see if they can beat the performance of the google search appliance.

Example of Why Cloud Based Computing is Smart

This Google Data Center YouTube video gives a great example of the attention to detail that Google has paid to data center infrastructure (HVAC, power, etc) along with the advantages of scale they have, provides efficiency levels most organizations could only dream of.

The way Google (along Amazon, IBM, Microsoft, etc) is much more efficient and cost effective than most of us can provide\justify for our own organizations. This is an example of why cloud computing begins to make sense and maybe the realization of Carr's vision of IT just being similar to the power grid - it just works.