One of the hottest business trends right now is cloud computing. One prediction is that the market for public clouds as data storage options will expand annually by 23 percent over a five-year period, increasing revenue from approximately $48 billion to a whopping $130 billion.

The appeal of third-party providers that maintain vast reserves of storage capacity available only when necessary is undeniable. Much in the manner that consumers now access only the electricity and water that they need, these storage reserves can be tapped during peak traffic and then released.

The market now is wide open with industry titans vying to provide cloud services. Some very diverse clients eager to save money and streamline the data storage process have been wooed over to the cloud.

As businesses worldwide continue data migration to the cloud, speculation over the security of the cloud platform arises. CIOs must minimize the risk of their corporate data being compromised by understanding and proactively managing the transition.

Identifying Vulnerabilities

All data storage systems are vulnerable to an attack—a sentiment that was made evident very recently. Any breach of data is a corporate nightmare. Reputations are made and staked on a company’s ability to safeguard their clients’ privacy and unique brands. When security is thwarted by a hack or an insider leak, a company’s brand can quickly lose its edge and market share.

The infrastructure for the cloud must be designed to the highest industry standards to safeguard privacy and withstand cyber onslaughts. Even so, some potential concerns of businesses using third-party providers for their software, storage, platforms, or infrastructure in the cloud include the following:

Risks and threats. Public cloud systems are portals that can be targeted in a hack. By design, they allow multiple people authorization and access—a situation usually avoided by networks that are owned and managed by a single user. However, risks can be mitigated, and the data security level increased to stave off attacks.

Accurate data assurance. Cloud service providers must maintain the tightest security controls on their managing software because the potential risk of a compromised server could affect multiple tenants. In a cyber attack or other critical event, there might be thefts and losses of data; some data may be seriously compromised in the breach. Whether the intent was malicious or when it resulted from an unfortunate accident, damage control is key.

Limiting data access. There is a question of liability. The Federal Trade Commission has the authority to order corporations that leaked sensitive consumer data to compensate those damaged by the breach. They also can order businesses to dodge hacks and cyber attacks by taking preventative measures.

Other Concerns
Further complicating matters is this: the 1986 Electronic Communications and Privacy Act that governs cyberspace has yet to be updated to reflect the current technologies. Therefore, at least in the U.S., the obligations of today’s companies remain murky.

In addition, American companies that do data transfers to clouds with servers based in the European Union are subject to the EU’s strict laws defining the obligations of  companies’ data security duties. This is applicable whether or not any of clientele are based in Europe.

For the best possible outcome, CIOs and CTOs can employ the cloud computing best practices and assess all security threats to safeguard data as it transitions to its new home on the cloud.