The legal framework for service levels around cloud computing has not kept pace with the advance of the technology itself, with customers sometimes ill served by IT suppliers as a result.
That is the opinion that emerged from a discussion of the legal issues affecting cloud computing, among other IT trends, hosted by specialist law firm Kemp Little in the City of London yesterday.
Chris Hill, senior associate at Kemp Little, said it is now generally accepted that cloud computing represents a real chance to boost productivity and deliver value in the business world – yet projects are still failing to deliver.
"Large chunks of functionality can be outsourced to specialised providers, delivering huge economies of scale," Hill said.
Calum Murray, partner and head of commercial technology at Kemp Little, added that the terms and conditions, and service levels backed by an appropriate contractual environment, have some way to evolve. Suppliers appear to be protecting themselves – at the expense of their customers.
"This area has probably not moved as quickly as the technology," he said.
Early cloud services contracts tended to reflect the large-scale, public cloud, one-to-many, commoditised characteristics of the early cloud services providers – big players such as Google.
As the market diversified and shifted, however, with more types of cloud services and providers emerging, people have continued to rely on the same or similar contract methodologies and practices.
"Very simply, we are now in a world of cloud services where there are more parties involved, more stacks of technology, and services. And at the other end of the spectrum, you have the commoditised services," Murray said. "One-to-many services, for example, are usually much cheaper than private-cloud services."
Commodity-cloud type contracts and service levels are often more or less non-negotiable and simply do not offer the flexibility that many customers require, and there is often a large offloading of liability in the customer's direction, he noted.
There needs to be more customisation of terms according to specific needs and time taken in conversation with the customer about the detail of the cloud services required.
"And they need to be taking things outside the department, and bringing them into the contract," Murray said. "So it's still a seller's market."
Charles McLachlan, associate at sister consultancy Kemp Little Consulting, told ChannelWeb after the presentation that the gap between what customers want and what they're getting with cloud represents an opportunity for a savvy IT channel company to be innovative in the service-levels and contractual area.
"Someone could really differentiate themselves," McLachlan said.
Things are changing, according to Kemp Little's Murray, but it will take time.
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