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Cloud computing may be a term you have heard of lately. It is the “new thing” being discussed in technology circles, but what does it really mean to businesses? Just like it sounds, cloud computing implies application services provided by a large and undefined mass of computers and networks. Most people do not think for a moment about what computing services it takes to perform a Google™ search or peruse items at Amazon so why not extend that model to businesses by outsourcing the responsibility of running the complex infrastructure of applications and data to some company or group of companies that already has a lot invested in running infrastructure?

One naturally first asks what problem cloud computing solves. Medium and large businesses are familiar with the answer: proprietary data processing, storage, and management is an enormous and complex burden and cost. To further confuse things, laws like the Sarbanes-Oxley Act of 2002 have created business and accounting rules which in turn require executive involvement in the technology a company employs, their disaster recovery plans, backup plans, data retention plans, strategy for technology refresh, etc. Each year, data stores balloon at an ever increasing pace. Facing this and a relentless torrent of new data each year, many companies are watching with interest how they can unload this burden on a silvery cloud of services provided by someone else. Wiping their collective brow, many companies would be happy to pare down their jargon-spewing IT staff and just write a check.

All things have trade-offs and cloud computing is no exception. Benefits include outsourced services from the ether but one detriment is potential “lock-in” to the provider. Right now, there are no open standards for data migration between providers though that has at least been brought up recently. Beyond the ability to move data between providers, prospective cloud computing customers would be limited to whatever services are offered by their provider; new services are at the discretion and timing of the provider. Some see this as a loss of freedom and a throw-back to the mainframe days. Other worrying things to consider include the lack of visibility regarding how security and data separation are maintained within the cloud. Normally businesses take great pains to ensure their data remain private and inviolate for both legal and competitive reasons. It gets even stickier when one thinks through the fact that many cloud computing operations work across geographical borders where different legal rules apply. Finally, in spite of the goal of off-loading their IT burden, it is ultimately the responsibility of each business to understand and control their data including where it is, who can access it, how it’s separated, how long it would take to get back online after a disaster, and what to do should a provider go out of business.

Of course, there is no rule saying that a business has to use cloud computing on an all-or-nothing basis. In fact, if it seems attractive for your business, I would recommend a pilot with one aspect of your business data which is particularly well-suited for the cloud. As with any type of gamble, do not bet more than you can stand to lose. In the meantime, cloud computing data migration standards appear to be slowly evolving amongst the larger players in an effort to present an attractive proposition to large businesses. Stay tuned.

Lee Le Clair is the CTO at Ephibian. His Tech Talk column appears the third week of each month in Inside Tucson Business