Recently, I had the pleasure of speaking to James Kunick, attorney and Principal at Much Shelist, about cloud computing. Jim has nearly two decades of experience representing a wide number of clients in various aspects of intellectual property, information technology, and corporate transactions. We thought he would be a great resource to reach out to regarding the legalities of cloud computing.

The legal implications of cloud computing have not been a popular topic thus far, and we’re not sure why. It is certainly an important topic to consider and discuss with your attorney and cloud computing provider. According to Jim, there are two major legal issues with cloud computing: loss of control over your data and applications, and the privacy and security of your data. For example, what happens if your cloud provider refuses to give you access to your data? Your contract must explicitly state that you have the right to access and retrieve your data at any time during- and after- the term of the contract. It is important to consider what happens once your contract terminates, and to lay out these details in the contract.

Moreover, while fleshing out your contract with your provider, make sure to document performance requirements and remedies for failure, put special emphasis on the privacy and security of your data, and make sure what you are signing does not get you or your data trapped. Additionally, the contract should outline who is in charge of remedying a data breach, such as who pays the (potentially expensive) costs of notifying all of your customers in order to comply with the growing number of states who have breached notification statues.

We hope this helps get you thinking about cloud computing from a legal perspective. When it comes time to sign a contract with your provider, make sure you have an attorney look it over in case any of these points are not addressed.

Special thanks to Jim for taking the time to discuss this with us. If you would like to reach out with him for legal help, you can email him at jkunick[at]muchshelist.com.

This post contains material of general interest and should not be construed as legal advice or a legal opinion on any specific facts or circumstances.

This month, Delivered Innovation is officially launching our newly designed website, built entirely on the Force.com cloud computing platform. Force.com allows companies such as DI to design, build, and host their own websites on the Force.com platform from salesforce.com. Our website now leverages Force.com technology such as VisualForce, Apex code, and content management system (CMS) designed using a custom Force.com data model. All content is written in 140 character “tweets,” to keep content brief and to the point, as well as create an experience that will be familiar to Twitter and Chatter users. Feedback is welcome.

• Delivered Innovation Launches New Force.com Sites Website, Built and Hosted on the Force.com Platform

Salesforce.com, along with Sequoia Capital, Google Ventures, and others invested in HubSpot’s recent round of fundraising. Hubspot helps companies manage their website and generate leads. Their revenue is up $10 million from a year ago, hosting 4,000 customers who use HubSpot to manage their website and generate leads. “HubSpot helps businesses build blogs and engage directly with customers via social networks.” Users can use both Salesforce and HubSpot together, pulling resources from both to utilize the cloud effectively.

• HubSpot Takes $32 Million Investment From Sequoia, Google Centures and Salesforce
  

Backupify launched Cloudsight this week, a private beta feature which combines the use of backing up documents in the cloud and allowing users to search through those documents. Cloudsight works with Backupify to make cloud-based backup more innovative and appealing for users. “In short, it’s not enough to have search in the cloud; you have to be able to manage and manipulate the data across services whenever you want.” Cloudsight is only available to Backupify users and can be activated once they back-up their data.

• Backupify Adds Search to Cloud Backup Service

In a recent study for “Leaders in the Cloud,” 43% of executives estimated that cloud-based services and products will dominate their revenue by 81-100% in the next five years. Additionally, “61% of respondents from companies with revenues less than $250 million are driving towards cloud-dominated business in five years.” Companies that want to stay ahead are already adapting to the cloud, but for the most part cloud services and PaaS are still in its infancy.

• Cloud Leaders Face a Changing Tide

Many businesses are using private cloud services rather than public, assuming these are safer than third-party public alternatives. However, private cloud services are just as exposed to security threats as public services. When it comes down to it, it is the architecture of the infrastructure that really matters; “Public cloud providers that offer sophisticated controls can outperform many enterprise data centers,” and can often provide more value than private cloud providers.

• Making the Public Cloud Your Own

March Madness has managed to weasel its way into Salesforce, as if it were only a matter of time. Users can install the “Brackets” application through the Salesforce AppExchange to make predictions, connect with other basketball-loving coworkers, and see how your predictions rank compared to other’s. With applications such as this, Salesforce really is the single source of data that all users will ever truly need, basketball lover or not.

• Brackets Brings March Madness Tourny Time to Force.com

We came across a number of blog posts from the past week that we found interesting.

To start, an article on how end user executives confessed at the SIIA OnDemand Europe conference in London that cloud ERP is more reliable, more secure, and less risky than the on-premise alternatives.  Phil Wainewright, the author, has voiced these sentiments before, but was delighted to hear it come from real-world business executives.  More proof that cloud providers are superior to in-house systems:

• End users explode cloud myths at #ODE10

Microsoft’s Chief Software Architect, Ray Ozzie, will be leaving his post, and he also is leaving a strong message for the “Post-PC” world.  He penned a memo named “Dawn of a New Day” which warns Microsoft to move away from the PC and towards “continuous services” in the cloud.

• Ray Ozzie Has Seen The Future, And It Looks A Lot Like Google

Ray Ozzie’s memo is creating a lot of buzz as we have another article explaining his message.  This article goes into the difference between “moving to” and “building for” the cloud and why it’s important to have a well-designed cloud roadmap for your enterprise.

• ‘Moving to’ versus ‘building for’ cloud computing

Has data storage in the cloud become completely commoditized?  Box.net, a cloud content management vendor, is proving size does matter.  They are allowing for larger storage space with the free edition going from 1GB to 5GB, and business edition goes from 15GB to 500GB.  The article talks about box.net’s eventual desire to achieve “infinite storage.”

• Sometimes Box Size Does Matter

Last but not least we have a post with Appirio’s first State of the Public Cloud Survey.  It includes a short video that explains the unique perspective of their cloud survey – that only early cloud adopting IT decision makers were surveyed – and a link to a free white paper that examines the actual business results and impacts those companies have experienced.  The findings are encouraging and eye-opening.

• Introducing Appirio’s first State of the Public Cloud Survey