Three major threats to the cloud
As Mark Neider of Cbeyond (Nasdaq: CBEY) noted in a presentation at TMCNet's ITEXPO earlier this month, cloud computing is gaining momentum and driving more bandwidth consumption as businesses large and small increasingly take advantage of the opportunities cloud provides. The biggest advantage, of course, is being able to purchase services once available only to enterprise-level companies--including business voice, back office and billing support, and data storage and security--at a very affordable rate.
But cloud services is still quite young--not in its infancy any longer, but perhaps headed for its terrible twos phase. And it faces some significant threats to its ability to grow. Here are three threats to cloud computing that businesses can't afford to ignore.
Usage-based billing – Terry Hedden, founder and CEO of Infinity Technology Solutions (now Zeno Technology Solutions, as of Oct. 16) made a pretty bold statement during a cloud services panel at the MSPWorld Conference in Austin earlier this month. "Metered bandwidth could end this whole cloud game," he said. The shift from allowing customers to gulp as many gigabits of data as they need, to charging for that bandwidth past a certain amount, could drive small and medium-sized businesses (SMBs) away from certain cloud services to more affordable options, some of which may be premise-based. Enterprises with more cash to spend might move certain core processes back to premise-based solutions--like on-premise PBX.
How likely is the threat of metered bandwidth to cloud services growth? It may be a hitch in growth, but providers are working on ways to combat the possibility. Todd Carothers of CounterPath, a Canada-based provider of SIP softphones and related FMC (fixed mobile convergence) products, told FierceEnterpriseCommunications the company has a couple of ways to combat the metered bandwidth issue.
"First of all the codec usage is not that heavy, it doesn't have to be that heavy across data and in some cases it can be cheaper than a voice call, especially when roaming," he said. "Number two, we found that 60 to 65 percent of our customers are in an active WiFi zone at all times so they can use WiFi to bypass that which makes it almost zero cost as well. So that's how we see from our perspective, doing voice, that's what we're doing to combat that issue."
Who owns the data? – Among SMBs, this may be one of the most overlooked issues in moving to the cloud. "Who owns the data in a cloud situation is a huge issue," said Julie Machal-Fulks, a partner at Scott & Scott LLP, on a cloud panel at the MSPWorld Conference.
Businesses need to include legal advice when developing their cloud computing plan and should closely review terms of the agreement with the cloud service provider.
A Computerworld article pointed out that a cloud computing contract should not just clarify ownership of data being moved into the cloud, but also identify limitations on how the provider can use a customer's data. Companies should also make sure their data is not being locked into the provider's cloud, and that they can migrate that data away from the provider if they decide to do so.
Furthermore, businesses need to clarify their responsibilities under the contract as well as the cloud service provider's responsibilities. For example, cloud customers need to define who accesses their cloud data and maintain security on their end--even something as simple as passwords. However, there is room to negotiate.
"If a cloud provider wants you to take on most of the risk, walk away," said Machal-Fulks.
Security – Last but not least, of course, is the security of a company's data once it's in a remote storage and management facility.
"When you are running in the cloud and you are shifting your data and applications to a cloud provider, you have no visibility over risk within their infrastructure," said John Howie, COO of the Cloud Security Alliance, in an interview with Infosecurity. "You can't cite controls or a defense-in-depth approach, because the cloud provider does that."
To combat the worry that comes with handing over a company's secure data to a third party, "partner with knowledgeable providers," Hedden told audience members at the MSPWorld panel. But more than that, he added, companies (and CIOs) should look for a cloud provider either within or serving a community that they're familiar and comfortable with.
Security is also somewhat of a unifying issue in the cloud's top threats. In the race to get around limitations set by metered bandwidth, providers or customers could compromise data security or unintentionally cede more control of their data to the third-party provider than intended, causing innumerable headaches for both sides.
It remains to be seen how much the top three cloud computing threats will affect growth of this market segment or impact the evolution of unified communications.