INTRODUCTION

990. WHAT IS CLOUD COMPUTING? – Cloud computing has been defined in many ways. Often cited is the definition of the U.S. National Institute for Standards and Technology (NIST), which describes cloud computing as

The European Network and Information Security Agency (ENISA) has defined cloud computing in slightly more neutral terms, as

991. KEY CHARACTERISTICS – Cloud computing involves the remote consumption of IT resources via a network (e.g. the Internet). Not every Internet application, however, is deemed worthy of the label of cloud computing. Most authors also consider “elasticity” and “measured service” as defining characteristics of cloud computing. Cloud providers typically allow customers to expand or decrease their resource consumption almost instantaneously, on a “pay as you go” basis. Finally, cloud services (especially infrastructure services) are often presented in a “virtualised” manner: providers dynamically assign and reassign resources from a pool which are shared as fungible resources with other customers.

992. BENEFITS – When using cloud computing, the customer externalises part of its IT infrastructure and associated maintenance. Instead of purchasing his own hardware and software, the customer relies on the services of the cloud provider. Because customers normally pay by usage, they can avoid large upfront costs which may otherwise be necessary to set up and operate sophisticated computing equipment. Moreover, customers can scale up or down rapidly as their needs increase or decrease. Put differently, cloud computing promises “computing power on demand”, with limited or no expense beyond actual consumption. Providers, in turn, are able to leverage economies of scale, by pooling their resources and reaching large volumes of customers with relatively low overhead.

993. RISKS – The risks of cloud computing mirror its benefits. By externalising portions of IT infrastructure, the customer invariably gives up a certain degree of control. Servers, data and applications are no longer kept within the organisation, but on the premises of one or more external providers. As a result, customers are by definition dependent on the cloud provider to implement appropriate measures to ensure the confidentiality and security of processing.