For an informed view on connected entertainment in the UK & Ireland, visit Cue Entertainment
Google,
Amazon, Sony and permission-based email marketer Epsilon have suffered from
intrusions, outages and compromising hacks into their systems over the past few
weeks. These companies are among the biggest names on the internet and the fact
that they can stumble and fall over for days at a time has cast a dark cloud of
doubt over the reliability and security of web-based services.
Yet
computers can and do go wrong, wherever they are located, and the advantages of
outsourcing IT requirements has to be balanced against the disadvantages
inherent in handing over control to a third party. As a correspondent to
technology provider Sunbelt Software put it, “Cloud computing is all very well
until somebody trips over a wire and the whole thing goes dark. That is when
you discover you are 100% dependent on someone else’s technology”.
The many
clients of the email-marketing provider Epsilon – including Marks &
Spencer, TiVo and Disney Destinations – learned this the hard way at the start
of April. The supplier sends out more than 40 billion permission-based emails
each year on behalf of its clients. Hackers broke into the company’s database
and stole the personal details of customers from 50 major organisations. This
attack signalled the start of what might be the worst month so far for internet
security intrusions.
Notwithstanding
the uncertainty prompted by the recent sequence of unfortunate events, global
consulting organisation Accenture has just released “Promise”, the first in a
series of five reports titled “Cloud and the Future of Business: From Costs to
Innovation”. In association with the Outsourcing Unit at the London School of
Economics, researchers polled more than 1,000 decision makers in business and
IT between late 2010 and early this year. They also approached consultants,
service providers and technology vendors and carried out in-depth phone
interviews with 35 system integrators, cloud providers and cloud service users.
The
authors identify a significant divergence between the views of the business
community (40% of the sample) and those of IT executives (20%). Respondents
involved in corporate management tend to the view that the adoption of cloud
computing will reduce expenditure on IT infrastructure, lead to more rapid
introduction of technological innovation and release resources that can be used
to develop the core business. They embrace the promised benefits of cloud
computing – and they want them now.
The
attitude of the IT executives questioned is more cautious. Although nearly 50%
of the respondents accept that cloud computing has a place, many warn against
the assumption that full functionality can be achieved overnight. They identify
compliance considerations and the nature of the contract between client and
cloud provider as important first steps and express their concern about how
their organisations will manage the flexibility that cloud computing provides.
One
comment from a respondent at SalesForce.com is characteristic of the enthusiasm
reflected in the report, “…through the use of cloud computing, the IT
department ceases to be part of the ‘business prevention unit’ and instead
delivers tangible business benefits.”
Customers
of the Elastic Compute Cloud (EC2) platform operated by Amazon might disagree
on those “benefits”. What started on April 21 as a minor problem during a
systems upgrade permeated through supposedly isolated zones and eventually
brought down the entire network. Although Amazon restored the service to some
customers within 12 hours, others had little or no access to the network for
several days.
Netflix,
which uses EC2 for its data services, was almost untouched by the problems at
Amazon thanks to resilient network design and the fact that its video streaming
comes from a separate content delivery network. Other customers were affected
severely including the location-based mobile service Foursquare and back-up
software specialist Druva.
Druva
offers continuous back-up protection for corporate laptop computers and
smartphones. In its advertising, Druva says that 73% of laptop users believe
that “intrusive backups” are a major obstacle to personal productivity. The
company’s solution, which also provides backup for office servers, runs
entirely as a background process and requires no intervention from the user.
The
company guarantees that backed-up data can be restored in minutes when
necessary, underpinned by service-level agreements that specify system
performance. Like many others, though, Druva relies on Amazon’s EC2 to deliver
the service.
The
replacement cost for lost, stolen or broken hardware mounts up quickly — in the
past two years the BBC alone lost laptops worth more than £200,000 — but the
value of the data they contain is immeasurably higher. Druva has been very
successful in tapping corporate concerns over this lost data so the failure at
Amazon was particularly infuriating for the company and its customers. Whether
Druva and other clients of Amazon will be happy with the company’s offer of a
credit of 10 days for every client in the affected zone remains to be seen.
EC2 is now
back in operation but Amazon admits that some client files are irretrievably
lost albeit just 0.4% of the total. Serious though that is for the businesses
involved, most customer complaints dwelt not on the loss of data but on the
lack of communication during and after the event. Only on April 29 did Amazon
issue an apology as part of a very comprehensive analysis of what went wrong
and how they plan to prevent the sequence of events occurring in the future.
The Amazon
Web Services team tells its clients, “We know how critical our services are to
our customers’ businesses and we will do everything we can to learn from this
event and use it to drive improvement across our services.” This Amazon
statement is an object lesson in corporate communications, one that Sony,
another victim of April’s storm clouds, has yet to emulate.
A total
systems meltdown that shuttered both the PlayStation Network and the Qriocity
connected-TV service would have been seemed a fantasy just a few weeks ago. Yet
malevolent attacks on the two networks began on April 17 and forced Sony to
suspend both services three days later. Before the shutdown, hackers acquired
the confidential customer data of up to 77 million users.
Service to
viewers who signed up for the Qriocity digital storefront on their Bravia
connected TV ceased on April 20. The Qriocity web site posts an anonymous
“Notice from Sony” regarding the suspension of Qriocity services, which advises
customers of the likelihood that thieves have obtained their credit card
information. As one disgruntled user posted on the Sony blog, “Good job I’ve
still got the Blu-rays …”
Although
these events and other less well-publicised failures have led some commentators
to disparage cloud computing, those outside these IT disaster zones should
learn from the mistakes of others. The first and most important was spelled out
many years ago: “Do not place all your eggs in one basket.”
It is
significant that US streaming rental service Netflix survived the worst effects
of the problems at Amazon because it did not rely on a single supplier. When
every screen in the headquarters building goes dark and corporate Blackberries
are unable to receive emails, it is too late for the CEO to march into the
office of the IT Head and complain, even assuming that the job still exists.
If
previous corporate decisions have inadvertently created a single point of
failure, managers have little option but to wait with gritted teeth until the
outside supplier resolves the problem. As the Sony experience reveals very
clearly, when things go wrong, they can take a lot of putting right. Although a
company can mitigate the damage done to its reputation by frank and immediate
communication, customers are not always ready to wait.
Sales of
the Xbox 360 have received a boost because of Sony’s misfortunes and it will be
hard for the company to recover the ground it has lost. When any company comes
to a standstill as the result of a cloud-computing malfunction, clients are
rarely sympathetic.
And when a
competitor offers an immediately available working alternative, you might not
see your customers for the cloud of dust.
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