Cloudware Economics - Guide to Cloud Computing for Business and Technology Managers - page 291

TABLE 14.2
Economic Costs of Cloud Adoption

Economic Costs Small and Medium Enterprises (SMEs) Large Enterprises

Data security SMEs are better able to use third-party

services such as payment processing to
handle secure transactions.

Data are an enterprise's most important IT and operating asset. Current
uncertainty regarding the security of the data assets stored in public clouds is
one of the most signiicant barriers in cloud adoption. Large enterprises may
not want their data stored in countries where intellectual property piracy is
prevalent. Some companies may not want their data stored on equipment
used by their competitors.

Data conidentiality SMEs face the same data conidentiality

issues as large enterprises.

One of the advantages of cloud computing and storage for conidentiality is
that the data transfer and storage algorithms encrypt the data into units that
are dificult to reconstruct without the specialized algorithms/keys if the data
are intercepted in transfer or the cloud security is compromised.

Data regulations SMEs face the same regulatory data

location issues as large enterprises.

Depending on the company's industry, there may be signiicant regulatory
issues regarding data location. Data that identify the individual in certain
health and inancial contexts are subject to LIS regulations. Similarly, the EU
has laws that restrict the transfer of certain data outside of its borders.

Data integrity The data integrity and reliability of cloud

suppliers may be higher than that
provided by the existing internal systems.

Cloud technologies are relatively new and storage and data transfer
algorithms slice the data into small units, which are stored and transferred
dynamically within the storage region. Estimating and factoring the risks of
potential data corruption of mission-critical data at this early stage of cloud
implementation may be dificult leading to nonadoption, especially if the
existing internal systems, processes, and protocols are working.

Data transfer costs For new initiatives that do not require the

transfer of legacy data to the clouds,
transfer costs are minimal. Getting locked
into a particular cloud service provider is
currently a market concern due to the lack
of open standards among the providers.

Moving the existing data sets to clouds inquires data integrity check to ensure
that all of the data have been transferred fully and that they have not been
corrupted. For very large data sets, this may represent signiicant staff costs.
Cloud vendors typically charge data transfer costs. If the data set is large and
there is signiicant data chum due to transaction processing, it may be more
cost effective to look at more traditional hosting options.

( Continued )