Is Data Safe in the Cloud?

Not many technology concepts have made their way into the popular lexicon as quickly as the “cloud.” Before mid-2007, references to clouds were pretty much confined to discussions about meteorology, and only tech geeks drew pictures of clouds on white boards to symbolize the Internet.

Today, the cloud is the focus of national TV advertising campaigns. You might even catch your mum dropping references to it as she pokes and swipes the screen of her iPad.

But despite the rapid acceptance of cloud computing, there are still widespread concerns about how safe your data is in the cloud. Are their backups? Can cloud services be hacked? Are you putting your business at risk of a cloud service provider’s servers go down?

As a cloud service provider that helps businesses exchange files with clients and vendors, I am here to tell you that you are justified in having some concerns about cloud computing. But right now you are probably concerned for the wrong reasons.

Most of the concerns about cloud computing revolve around service up time, security and potential data loss. A random story will crop up about a single user who lost all of his photos from an online site, and the news will spark discussion about whether your data is safe in the cloud. For important business documents, is it prudent to outsource the responsibility of data backup and security to a third party? Surely for important business files, only you can be trusted to take the proper precautions to make sure your data is secure, right? Well, not exactly.

This kind of thinking – that your business can do a better job with the protection and up time of your systems than a third party – is based on a clever trick that your brain plays on you. Your brain is conflating control with safety.

This same fallacy is what causes some people to be afraid of flying on an airplane. Because they are not in control of their own life while they are a passenger on the plane, they become afraid – and this fear makes them think they are in danger. In reality, their drive to the airport was far more dangerous than the flight – but while they were driving in the car, they were in control of their own destiny and hence they felt safer.

Most cloud computing companies are like experienced airline pilots. They are well trained, have backup systems and contingency plans in case they encounter an issue, and they have a full staff of professionals regularly checking and maintaining their service. Cloud software companies, knowing the implications of a crash on their business’ bottom line, invest significant resources into insuring that such a disaster never occurs. Cloud computing companies can invest far more resources in data backup and security than your business can.

Regarding up time, there are two different business cases to consider. In the first case, you already host a service in-house that is exposed to the Internet and needs to be kept online. Examples include Exchange servers, FTP servers and VoIP phone systems. For these cases, most likely up time should not be a huge consideration for you when deciding whether to outsource these services to a third party. By hosting such services in house, you are already exposed to potential downtime issues and you have probably already experienced some. As long as you do a bit of homework into the up time track record of the service you choose, you will be fine.

The second case is one where you have some sort of offline process and you are thinking of moving to an Internet-based service. Examples of this are things like moving from Office to Google Docs, moving from an offline CRM system like ACT to, or moving from the desktop version of QuickBooks to QuickBooks Online. For decisions like this, I would recommend proceeding with caution. Think about whether a downtime of several hours or even a full day is something you can live with. While rare, issues with your own Internet provider or with your cloud provider’s servers do sometimes occur.

If you are outsourcing an important business function to a cloud company, I would recommend at least verifying that they are not operating out of a garage. Here are a few questions that can help you make sure you are picking a trustworthy vendor with regard to data backup and security:

* Is all data transmitted and stored encrypted?
* Do they perform regular third-party security audits?
* Is data stored in a SAS 70 audited data center?
* How many full-time employees do they have?
* Have they ever experienced any security breaches?
* What is the up time track record of the company, as verified by a third party and including scheduled maintenance?

There’s another issue, meanwhile, that you might not be thinking as much about: data portability.

Data portability is a crucial consideration when considering cloud vendors. In other words, if you choose to change cloud vendors or move to an offline system how do you get your data back? There is a lot of discussion online about how Facebook makes it extremely difficult to export your pictures and other data from its system – but the issue is even more relevant for businesses. If you are thinking about using a cloud-based system for CRM or accounting, ask the tough questions up front about how you can get your data back if the company goes out of business or if you simply want to choose a different solution. Unless the provider can give you a very clear explanation of how you can get your data off their system, avoid them.

Also, make an effort to think as practically about whether the vendor’s solution for exporting your data is really feasible. Your vendor may tell you that you can download your files from their system, but their solution is not workable if you’ve accumulated 250 GB of files. It would take weeks to download that much data. Ask them if they provide a service to burn that data to a DVD or write it to a hard drive and mail it for a fee.

Here are a few questions to ask when choosing a cloud provider to make sure they’re a stable long-term partner with reasonable data portability support:

* How long has the company been in business?
* Are they stable and profitable, or are they losing money and propped up by VC funding that might go away?
* How do you get data off the system?

To sum up, cloud tools can add a lot of efficiency to your business. And most of your concerns about cloud computing can probably be chalked up to irrational fears due to lack of control rather than legitimate dangers. If you’re thinking of using a cloud solution, though, remember to consider data portability. Even if you are flying in the safest plane in the world, the flight becomes pretty unpleasant if the plane doesn’t have working exit doors.

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