US dominance may pose cloud computing risks

NZ Open Source Society president Dave Lane claims there is a creeping influence of profit-biased US-style cloud operations

Ultra Fast Broadband has the potential to convert New Zealanders from a purely downloading online lifestyle to full-hearted participation in the cloud, says InternetNZ CEO Vikram Kumar.

The bottleneck now represented by New Zealand’s restricted bandwidth will be dramatically cleared and there will be much more movement of data in the upward direction, particularly in the use of cloud services.

This makes it urgent to pay attention to the risks entailed in moving data to and from the cloud, he says.

However, a panel on the subject at a privacy forum hosted by the Privacy Commissioner’s Office in Wellington last week brought a wide variety of perspectives. Microsoft legal counsel Waldo Kuipers insisted there was no new problem but New Zealand Open Source Society president Dave Lane claimed there is a creeping influence of a profit-biased US-style of cloud operation and the export of US laws governing information processing.

Most of the cloud providers we will be using are US-based, Lane says. “In the US, as you’ll be aware, the first priority of corporations is to maximise profit to their shareholders. In fact the directors of any corporation can be held legally liable if they don’t do this. The interests of customers come much lower down the priority list, he says. Actions to maximise profit could easily be unethical; the fact that they’re not actually illegal is no comfort, “because we already know the legislation is decades behind the technology.”

Cloud providers will insist they are applying ethical standards to their customers’ privacy, Lane says — “I can think of at least one [Google] that talks about doing no evil” – but that is no guarantee for the long-term future. The company may fall on hard times and have to sell out to a larger and less scrupulous entity to maintain that necessary profit.

Against Lane’s view, Kuipers acknowledges that there are privacy problems associated with outsourcing and overseas location of infrastructure supporting New Zealand companies, but this has been so for many years, he says and the advent of cloud computing adds no new risks associated specifically with the cloud. “I think it’s important to distinguish between the risks of the cloud and the risks associated with some of the [broader] trends that are happening today.

“There are many different kinds of cloud,” he says; “It is becoming increasingly easy for someone to deploy a cloud inside their own operation, in New Zealand and entirely under our control.”

Cloud computing analyst and blogger Ben Kepes trod a middle ground. There are risks in cloud computing, he told the forum, but most users would evaluate the benefits of cloud as greater than the risks. Out-of-date legislation is a problem – probably “two to four years out-of-date” rather than Lane’s “decades”. Exercises such as the New Zealand Computer Society-coordinated Cloud Code of Practice serve not only to put regulation of the market on a firmer footing locally, but to raise public consciousness of risk and encourage more careful thought.

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