Cloud Danger

February 25, 2019

There is much talk, hype, promise and motion around companies moving into the cloud. From pulling email servers and databases from the local office and putting them into a SaaS model with Microsoft o365 or Google G Suite, to moving entire datacenters into an Infrastructure as a Service (IaaS) or Platform as a Service (PaaS) model. The promise that “Cloud” can increase efficiency, flexibility, redundancy and security while reducing labor costs and capital expenditures is proven.   However, this all comes at a risk, especially in a downturn.

If you are old enough to remember the economy of 2007 and the drastic changes that took place between 2007 and 2009, you probably understand market downturns.  The companies that survived the drastic changes in economic conditions relied on corporate flexibility and the ability to pivot for their continued existence. Cutting labor, cancelling projects, slashing budgets and foregoing upgrades or expenditures made all the difference in ensuring  survival. Yet today, companies seem to be ignoring these historical lessons learned when it comes to cloud based computing. 

Mission critical systems are just that, mission critical. Without them your business will not function. When systems are hosted off site via IaaS, PaaS or SaaS the lifeblood of your company is outsourced to a third party. Their survival is your survival. When you move your systems to the cloud the partner you choose also becomes mission critical to your organization. Don’t think for a moment the providers don’t know this. They hold all the cards. More important, they hold your cards, the cards that make your business run.

When times are good and cashflow is positive there may be little thought to exit strategies or contract terms. Yet when the time comes to making those difficult choices like in 2008, paying your cloud provider to keep your systems running isn’t a choice; it’s a requirement to ensure your existence. The risk of moving your mission critical systems to the cloud is that your ability to pay equals your ability to exist. In most cases your provider won’t push out the expense of hosting your systems beyond agreed upon terms.  The providers manufactured exit barriers may tie your hands further.  You need a contingency plan because in this the proverbial “gun is to your head” moment, if you don’t pay your servers and services get turned off. 

On the other hand, your provider can also close its doors due to hard times, unforeseen circumstances or legal issues. In fact, back in 2013 a large provider called Nirvanix ( https://en.wikipedia.org/wiki/Nirvanix ) stopped offering cloud services and gave customers only two weeks to move their data off of their platform. In 2015 cloud provider 2e2  gave only a two-day notice to its clients  before ending their services and closing its doors. When you rely on a cloud provider for your servers or infrastructure and they go out of business your virtual servers and infrastructure are essentially gone. Perhaps more important, your processes, data and information are no longer available.  And we aren’t even touching on foreign acquisitions where your data may be moved to another country.  

My point is this: Out of site doesn’t equate to out of mind. Have a plan now, not later. Know your exit strategy with your cloud provider, preferably before you sign the agreement. Know your pivot points. Understand the need to keep tight control of your mission critical systems regardless of where they reside. Acknowledge that history often repeats itself. Don’t sacrifice the flexibility to exist when times get tough or situations change. The company you save may be your own. 

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