Grey Areas: The Legal Dimensions of Cloud Computing

Grey Areas: The Legal Dimensions of Cloud Computing

Michael Davis (Adelta Legal, Adelaide, Australia) and Alice Sedsman (Adelta Legal, Adelaide, Australia)
DOI: 10.4018/978-1-4666-1758-2.ch017
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Cloud computing has been heralded as a new era in the evolution of information and communications technologies. ICT giants have invested heavily in developing technologies and mega server facilities, which allow end users to access web-based software applications and store their data off-site. Businesses using cloud computing services will benefit from reduced operating costs as they cut back on ICT infrastructure and personnel. Individuals will no longer need to buy and install software and will have universal access to their data through any internet-ready device. Yet, hidden amongst the host of benefits are inherent legal risks. The global nature of cloud computing raises questions about privacy, security, confidentiality and access to data. Current terms of use do not adequately address the multitude of legal issues unique to cloud computing. In the face of this legal uncertainty, end users should be educated about the risks involved in entering the cloud.
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The Growing Cloud

Sceptics have denounced cloud computing as the next ‘ bubble burst’, but since the emergence of Amazon Web Services, Google Apps, Microsoft Office Live and IBM Blue Cloud, cloud computing appears to have become a significant and sustainable force in the ICT Sector.

The uptake of cloud computing services by major corporations such as Coca Cola Enterprises, Nokia and The New York Times has given credence to the permanency of cloud computing (Arnold, E., 2008; Lyons, 2008a; Fitzgerald, 2008).

Cloud computing is reaching into the world hubs of software development. IBM is developing its latest cloud computing facility in the software development region of Wuxi, China. For a subscription fee, software developers will be able to use IBM’s open access source code to collaborate, design, develop and test their software (IBM, 2008b).

The high uptake of cloud computing services can be attributed to clever marketing campaigns that promise end users low charges for data storage facilities and unrivalled access to computer programs such as word processing, bookkeeping and collaborative networking (Microsoft Corporation [Microsoft], 2008a). The centralised series of host servers that supports cloud computing, enables end users to carry out their everyday ICT tasks without in house software, downloads, storage space and support services (Otey, 2008). Cloud computing hosts are further reducing end user costs by assuming managerial control for the running and maintenance of ICT services. However, the decline of end user responsibility and control over ICT management has consequences for possession rights and ultimate accountability.

The implications for end users who place data into the cloud without properly understanding the inherent legal risks can be serious.

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