8 Common Risks of Cloud Computing

Cloud computing is most certainly revolutionizing the way small-medium businesses (SMBs), and companies in general, use IT. Cloud computing has in fact allowed businesses to access high-end technology and information at an affordable cost. In most cases, SMBs are able to access new technology and more resources without the premium price it would have cost in the past.

This is obviously a benefit for the business' operations and bottom line.

Prior to cloud computing, companies had to budget for buying hardware (servers and network just to mention some) and software (operating systems, security suites, productivity programs). With the advent of cloud computing, they now can tap into shared resources without even needing to sacrifice office space!

Cloud computing is the right choice for many SMBs that are okay with outsourcing and comfortable with using another party's facilities to store their data, software and devices. Providers are paid a subscription cost and offer a pool of services including updates, IT assistance and training, if needed.

If so wished, companies are freed from the need to have their own IT department, IT server rooms, etc?

Of course, cloud computing cannot be for everyone.

Companies that have specific privacy concerns, however, still have the option to subscribe for hybrid systems. They can maintain control over their data, for example, while still using shared resources to cut costs. Cloud computing is also essential when a business has employees in satellite offices or that work remotely while on the road or visiting a client through laptops or tablets. The cloud makes it much easier for them to access needed information and resources.

So why isn't cloud computing the choice for all companies? The answer is obvious: the inevitable risks of cloud computing. Switching to this new way of defining IT requires an in-depth evaluation of the business' needs and an analysis of how much risk can be tolerated.

Continue reading below for some of the 8 most common risks businesses face with cloud computing, along with some considerations for addressing these concerns.

1. The impact on a business return on investment (ROI)

Migration to the cloud might sound like the most cost effective option, but businesses should carefully compare the costs of owning software and equipment with the cost of "leasing" IT technologies. Parameters like speed, security, usage, quality of service, scalability and support must be considered.

2. Compatibility

Migration to the cloud might pose problems of compatibility with an existing IT infrastructure, or with a company security requirements and organizational policies. Pre-planning is once again crucial in considering all these aspects prior to committing to the change.

3. Trust

Not all providers are equal. Services through cloud computing may be interrupted by unforeseen events. Outages from a service provider, for example, can happen. Since providers are unable to guarantee no service disruptions will occur, data may not be available 24/7.

In a disaster situation, communications may be slow or shut down for a period of time. Once again, a careful assessment of the cloud service provider is paramount. Businesses need to consider the risks associated with trusting all their operations to an external party and what would happen in case of default and interruption of service. What guarantees the cloud service provider offers if disaster strikes is what a business needs to consider.

4. Confidentiality

Probably the main concern, confidentiality is often mentioned as the reason for not embracing cloud computing. If a company's operations require the handling of sensitive data, the protection of these data becomes a priority and a concern. A business might not feel confident in sharing with an external party their vital information. Responsibility for a data leak could be hard to assign when data are handled and transmitted between two parties.

5. Compliance

There are risks involving non-compliance with existing policies and contractual obligations related to the handled data or the business operations. The legal implication of using an external IT provider should be carefully reviewed.

6. Security

Not just confidentiality, but the entire structure should be evaluated. Where's your data going to be stored? Who will have access to the information? What security measures and protection does the cloud provider offer? Is all information (even when non-sensitive) transmitted in unsecured plaintext or is it encrypted at all times?

7. Lack of control over performance

There is always the risk that the system quality may be inadequate or that a cloud service provider is unable to provide quality services at all times. It should be clear what guarantees the provider can offer in terms of systems performance and, especially, how prompt is its corrective action in case of a disruption of service. Not having direct access to the infrastructure means that a business must rely on the prompt action of the provider when something goes wrong.

8. Lack of control over quality

A business needs to trust the quality standards that a provider can offer over time. How easy would it be to switch providers in case of an obvious degradation of quality?

Many of these risks can be mitigated by careful planning and attention to details when drafting service contracts with cloud providers. For example, risks related to privacy and data confidentiality can be reduced by using hybrid cloud computing ? sharing only some resources but not relinquishing data control.

Even Steve Wozniak, the co-founder of Apple, has expressed his not-so-flattering opinion, on the rising and widespread adoption of cloud computing. Wozniak forecasts many "horrible problems" that will derive from the use of cloud computing. He too points out the issue of lack of ownership of data and resources. He sees the lack of data control as a true concern and believes the problem will only spiral towards the worst as more and more resources are shared.

Regardless of the risks and adverse opinions, however, it seems cloud computing will continue its growth. Only time will tell if the benefits of this IT revolution will outweigh for good the risks involved.

If you're searching for a cost-effective IT solution and have flexibility in data storage and operations, cloud computing may be the right choice for your enterprise. To learn more about available options, contact cloud computing specialists at Atlanta-based Innovative Architects today.