If you own a business, your IT staff is likely one of many across the globe who are slowly convincing businesses owners and managers that storing data in “the cloud” is the future. He or she probably pointed out that hiring a third party to store your company’s data will allow you and your employees to access it from anywhere via the Internet, cut costs, and may help you avoid a great deal of hassle should something happen to the company’s on-site data storage facilities. But before you give the green light to your resident tech geek to start outsourcing your company’s data storage to the cloud, there are several legal considerations that you should be aware of prior to making the big move. Here are the five major questions that you as a business owner or manager need to know the answers to BEFORE signing a contract with a cloud service provider:
1. Who will have access to your business’ data?
The first piece of information that you need to obtain from potential cloud service providers is whether a third party will be processing, storing, or transmitting your company’s data. In some cases, a cloud service provider may not actually own the servers where your data will be stored. The cloud service provider may subcontract out the storage of data, and that subcontractor may in turn be subcontracting out storage services, and so on. Other cloud service providers may offer bundles of cloud software services that seem to all be part of one application to the user, but are actually made up of several subcontractors that operate the different services and the associated data storage. The more subcontractors that are involved, the more legal risk your company will likely be subject to because it can never know where the data is physically located and how well it is protected at any one time.
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