I am continuing to sell the services of an 10 year old data repository provider and I am asked about the possibility of bankruptcy as part of a client’s due diligence ( only though a small portion ever ask). I reply that unless disaster hits the client’s business the exactly the same time as the bankruptcy occurs, each client will recognize through sudden lack of service they will have to start their offsite backups of their production systems promptly with a new provider.

I then ask them about the reliability of their Internet connection; have they a redundancy plan for that possible loss? I then recommend the features in my services that create redundant backup paths.

For any Cloud service have a Plan B

Regarding the notion that one could simply pick up an environment and easily (read quickly and inexpensively) drop it into another cloud, surely you would agree that this is similar to the intent of early application server developers. Clearly it never worked as advertised due to the number of differences between the environments and despite development standards. I would love for it to work this way, but I do not believe it is realistic at this time.

Thank you for the link. I will take a look there as well.

Of course you need to do your due diligence on the provider and make sure what they are supplying and how they are delivering it meet your needs but this is no more than the typical due diligence you need to do on a typical infrastructure upgrade. I have see a multiple site upgrade Exchange upgrade, implementation of email archive done with zero down time.

We don’t see data growth as files are stored in native format and there is little data duplication with a Cloud based environment unlike a typical corporate with multiple sites.

Consequently the time and cost taken moving from an on premise solution to a cloud based offering is far quicker than a major infrastructure upgrade.

If you are interested in Cloud Computing news please take a look at my blog http://www.cloudcomputing.ltd.uk/blog/

In some situations your claim would be true. But I suspect it is not necessarily the case as the complexity of the environment and amount of data under management goes up.

These are valid concerns for companies. However, in my opinion each of these areas can be addressed by cloud providers.

For example email compliance and retntion solutions that capture all emails in, out or around an organisation and global based discovery are available. Mature cloud based solutions compete favourably against equivalent on premises solutions.

Data retention is also key with a number of Cloud Service providers not providing best practice around data backups. On the flip side some are and recovery process is of enterprise class functionality facilitating improved e-discovery capabilities.

On the issue of data privacy – most good Cloud Service Providers security solutions are of a higher grade than you typically see at corporates’ focusing over and above the usual perimeter security.

Moving forward stealth technology that provides the same privacy of information that on-line backup will start to become best practise. It will enable encryption of the data before it leaves your premises so the Cloud Service Provider can manage your data but not read it. Watch out too where your data is hosted different countries have their own legislation that can effect you for instance the US patriot act.

Concerning financial concerns of Service Providers. To do Cloud Service Provision you have to do this on a large scale to make it viable. Many Hosted Desktop providers are turning to the channel for customer acquisition as there are few companies that can achieve the growth they need within their existing customers.

I predict a large number of Cloud Service Providers going bust. So you need to make sure you do your due diligence properly before sighing contracts. Early signs to watch for are Service Providers infrastructure issues and service provision problems.

On the plus side switching providers is easier than doing a major infrastructure migration.

As with most things there are things to look out for and that is where specialist companies like Cloud Computing in the UK can help.

Contracts may have little impact/value in a scenario that involves a service provider’s bankruptcy.

Regardless what the contract might say, it is very likely that the obligation will be lost in the flurry of activity that consumes a failing business. Should the service be shut down for any length of time, a company may find itself without access to its data for weeks, months or longer. And loss of the control of its data will, in many cases, have legal ramifications.

Federal statute does give priority to post bankruptcy creditors to enable a company to continue (or wind down) its operations. That may help some customers in their quest to recover data.

I’m going to go out on a limb here. Legals eagles correct me if I am wrong, but court-ordered damages due to lost data are likely last in line to be paid, along with unsecured debt. So even if the bankrupt service provider fails to fork over the data, it is unlikely that customers will be compensated for their losses.