Consistent with our advice to clients about transitioning to seemingly simple and safe cloud computing,  lawyers advise CIOs to consider cloud computing just like they would consider outsourcing services before using them.

Plan your exit strategy up front

Businesses must consider what happens to their data, when they will get it back and in what format, the lawyers advised. “Having cloud standards will provide businesses with guarantee on getting back control of their data when they leave the cloud but until such standards exist, IT must think about what will happen to their company’s data."

“It is important to plan the exit strategy right at the onset of contracting cloud services,” said Paul Hinton, commercial technology partner at Kemp Little LLP. “It should be the second thing you look at after deciding to use cloud services.”

They further warn users to clarify the timescales of when users will get their data back in case of contract termination before signing up the contract.

Agreements should not rely solely on IPR (Intellectual Property Rights) provisions in relation to dealing with intangible data on expiry or termination of the contract, the lawyers warned. 

The legal professionals cited the court case between the company Your Response and the service provider Datateam Business Media. Datateam refused to hand the data back to the customer because the user ended the contract. 

Understand the service terms

Public cloud is a one to many service and the service terms never put the risk on the supplier, the legal experts added. “If you read the clauses around downtime, you will see that it does not include scheduled or emergency maintenance works or things out of supplier control like area-wide electricity cuts or natural disaster,” Joint said.

Even if you get 99% availability, it still means 10 full days of downtime. "Can your business afford it?” asked Hinton.

Cloud providers also maintain that loss of data is not their responsibility and backing up data is the customer’s business, experts added.

But the experts concluded that cloud contracts are becoming increasingly sophisticated and fewer enterprises are losing the battle with the suppliers. “As competition increases, suppliers are more willing to address customer concerns,” Hinton said.

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