The "Cloud" - an economic impact?

Hi,

The "Cloud" is a hot topic and one I guess discussed frequently between CIOs. I would say I will blog about this many times over the coming years and decided to write a quick post today following a question which popped into my head...

You frequently hear of economists making statements such as  "the recent snow storms (or whatever the event) has led to a loss of so many £millions in revenue due to many businesses being unable to operate".

Businesses now are more reliant than ever on IT systems and this will only increase. If a company has a severe network outage which lasts a few hours this can have a major impact on the business depending upon their reliance on IT systems. Of course good business continuity strategy and system resilience can mitigate against these but such things can come at high expense and just how many companies in such times can spend their money on such things?.

Anyway, getting back on track... Now imagine the wide adoption of cloud based services. A network outage now of several hours at a large provider can take out hundreds of businesses at huge collective loss. OK, so I would imagine that these cloud service providers will have multiple layers of resilience to mitigate against such an outage but it is not something which is an impossibility.

Lets take this one stage further, imagine an outage of a major ISP, even at a localised geographic level, this could stop hundreds of companies reaching their cloud service which is located elsewhere. Again I would imagine that Cloud providers will have ISP resilience but most companies trying to route to them will most certainly not.

The point here is obvious, the Cloud providers will be centralising many companies services which makes the following crucial:

• The Cloud Providers Infrastructure including network, security, servers, storage etc
• Circuit and ISP Resilience of the Cloud Provider
• A customers own network and their ISP connectivity
• A customers own security

OK, so maybe large centralised outages are rare but surely the impact if it happens is vast and such strategy providers an obvious target for malicious attacks wishing to cause maximal disruption.

Going back the original comment about economic impact, if such outages happen, could this be large enough to provide a noticeable impact to a countries bottom line. Oh and of course many IT department will be stripping back their technical teams as they have less servers and storage to manage. More people on the Job queue maybe?.

I am not against "Cloud" in anyway but I am interested in others thoughts on the subject of risk and what IT professionals should way up when looking at strategy and a possible move towards the "Cloud".