' Cloud Computing: Risks and Regulation | MTLR

Cloud Computing: Risks and Regulation

Cloud computing, though its definition can be expressed in a more detailed manner, is basically the next generation of IT systems organization, where data and applications are centrally accessible through individual portals such as laptops or desktops.  Many popular sites operate on a cloud computing model, including Facebook and Google Docs.   Earlier this year, the announcement that the U.S. government would be moving toward cloud computing raised the profile of this rapidly developing phenomenon.  By adopting a cloud computing model, the government highlighted the increased efficiency that cloud computing can produce, but also brought to the forefront some of its problems, including security and privacy risks and the difficulties posed by questions of how, or whether, to regulate this form of systems organization.

In Security in the Ether, David Talbot examines the expected expansion of cloud computing and the potential security risks posed by such computing.  Major security risks are implicated by storing data on remote servers also used by third parties, who may be able to access the data.  Providers of cloud computing services are working to increase security with more sophisticated methods of encryption.  Because cloud computing will most likely grow in popularity, and become popular amongst entities such as banks and health care providers that deal with sensitive information, cloud computing represents an area in which the government may wish to regulate the storage, protection, and use of information.

The aggregation of more and more data into fewer and fewer places provides an environment for government regulation that the internet thus far, with its seemingly infinite reach and scope, has not.  Most government regulation of information use, such as the Red Flags Rule requiring businesses to track their own information for signs of identity theft, has involved a particular provider of services monitoring its own information for potential misuse.  Large scale cloud services providers, whose servers will provide data processing and storage for numerous entities, could present an easier method of regulation of information.  In addition, because of the large amounts of data involved and the security risks posed by data centralization, the government has a strong incentive to regulate cloud computing providers.

Government involvement in cloud computing could prove problematic.  The incentive to regulate also invites the risk of over regulation.   Government regulation regarding the use and dissemination of information, though intended to increase security for individuals, could stunt technological innovation and decrease the efficiency of cloud computing.  Jonathan Zittrain, co-director of Harvard’s Berkman Center for Internet and Society, points out that the freedom and experimental nature of the internet are at risk with the rise of cloud computing.   In addition to risks posed by over regulation, cloud computing poses significant Fourth Amendment concerns.  Legal precedent for privacy rights of information stored in clouds is murky at best because of the sophisticated technology involved.  As cloud computing continues to increase in popularity, policy makers will need to balance the interests of individuals in the privacy of their data with the interests of the government in having access to that data, the interests of these same consumers in a more efficient, free, and innovative internet, and the interests of businesses that provide and utilize cloud computing services.  Any government action that does not balance these competing interests will work to the detriment of developing the next generation of systems organization that further realizes the potential of the internet.

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  1. Microsoft Proposes Cloud Computing Regulation at The MTTLR Blog - [...] December, MTTLR reported on the regulatory problems posed by cloud computing.  Weighing in on this ongoing debate two weeks…

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