The Cloud is Bad for Business

I just read that the Vice President of Yamaha America is moving his business’s data servers offsite and into the cloud.  This is a cost-savings effort that replaces a server leasing strategy.  He’s managed to move the entire company into the cloud save for three areas: Enterprise Resource Planning, the phone system, and employees’ files.  But, he wants to move all of that into the cloud, too.

And that’s where we address this post’s title.  The Cloud is bad for business.  Enterprise Resource Planning applications are the link between a company’s operations and their accounting department.  In short, the ERP system keeps real-time account of all assets (human and otherwise) flowing in to, out of, and through a company.  It knows when assets are due to arrive.  It knows cash inflows and outflows.  It knows the value of items arriving at and leaving from the dock.  You could say that the ERP system is a real-time digital copy of the company.  If you were inclined to steal high-value items, or divert funds to yourself in a flurry of business transactions, or do any number of heinous things to a company, you would want access to the ERP system.  It would tell you where, when, and how to make your move.

The Cloud isn’t proven to be secure, nor reliable.  Putting the ERP system in the Cloud is the dumbest, most naive thing I have ever heard.  You might as well just post your company’s general ledger on the front door and let passersby make entries.  Typically, that information is even kept away from most employees.  If you’re in a highly competitive industry, you might as well just tell all of your competitors who your best suppliers are, and how much you pay them for their goods and services.  All of this data is now floating out there in the cloud, accessible remotely by anyone persistent enough to crack a couple of passwords.  Remember the fappening.  (Don’t google that at work.)

So, there’s that.  The next terrible thing about the Cloud is that while you have eliminated in-house IT support and maintenance, you have added a lynchpin to your system that would not otherwise be required.  Your company’s ISP now controls your entire system.  If you do not have internet access, or if your internet access is throttled (I’m looking at you, Net Neutrality), you are losing gobs of money by the millisecond.  As it stands now, if I lose internet access at work, I can still do my work because the data is local.  I may not have the convenience of googling for information, but I can still access all of my models, shared documents stored on the server, etc.  In other words, I’m only slightly slowed by a loss of internet access, not maimed.

Furthermore, the Cloud may not actually take off.  Sure, just about every software company is pushing it.  That’s because they see dollar signs in essentially holding your data hostage, and forcing you to pay for their software in perpetuity.  Adobe Creative Suite is now Cloud-based.  That means you pay monthly the use an always-updated version of any Adobe software.  The data you create stays on their Cloud servers.  But, what if users reject it?  What if this whole Cloud idea flops?  Will Adobe give that data back before shutting down the Cloud servers?  How much warning will be given, if any?

Why buy a stand-alone software package that you will have to upgrade annually when you could just pay monthly for an always-updated Cloud version?  Well, because some people don’t want to upgrade EVER.  That’s right.  Some people just want to buy software once and then use it until the technology is obsolete.  Furthermore, paying monthly really only has value if you use the software all the time.  At work, I have a license for Adobe CS and I honestly haven’t used the software in 6 months or more.  Seriously.  Does it matter?  No.  When I need it, I have it.  I will always have it.  A year ago I used it as much as I used any other software on my computer.  That may happen again in the future.  If it does, I’m prepared.

Finally, the laws pertaining to the Cloud are in their infancy, or not even yet conceived.  Do you own the data that you upload to the Cloud?  Which jurisdiction’s laws apply to that data?  The former can be stipulated in your service contract, but the latter is more ambiguous.  The truth is, no one knows, yet.  The Cloud is so new that there aren’t any legal precedents.  The data is accessible from anywhere in the world.  The data may be stored in multiple states or even countries.

So, what is the Cloud good for?  It’s good for sharing low-value, non-sensitive data.  Got a giant PDF that your e-mail server refuses to send?  Use the Cloud.  Got some schoolwork that you need to access from multiple machines?  Use the Cloud.  Got a zip file full of cat pictures that you really need to send to your Grandma?  Use the Cloud.  Got all of your company’s sensitive, vital information?  Keep it on your own servers.

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