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The benefits of storing data in the cloud are clear. However, as businesses are beginning to closely examine what having data in the cloud entails, they’re discovering that their relationships with cloud vendors are sometimes, well, cloudy.

In a 2015 Forrester Consulting survey, more than 60% of businesses said issues with transparency were stalling further expansion into the cloud. These organisations are justified in being wary, because knowing where data is going and how it is being treated is paramount.

I’ll explain why the next wave of successful cloud providers will compete on these issues rather than price, product or market.

Why is location important?

If backups are vaulted in the wrong geographic location, businesses limit their ability to rebound from an incident within the necessary recovery time objectives (RTOs), due to latency concerns and bandwidth cost. The goal of strategically selecting where data will be vaulted is to minimise organisational risk as much as possible. To achieve this goal, businesses need to have two separate RTOs in place for operational issues that are specific to the individual environment (such as a server outage), and regional disasters.

A business would likely require a lower RTO for an operational issue, which would allow for local data vaulting, whereas a regional disaster could either have an equal or less aggressive RTO, simply because customers view events affecting several providers in a given area differently to an event affecting a single entity only. Unfortunately, many organisations focus solely on addressing operational RTOs in the disaster recovery (DR) planning process, which is catastrophic in a widespread event.

One of the benefits of the cloud is that it allows businesses to achieve a solution that addresses both operational and DR RTOs – they just need to know where the cloud’s data centres terminate. The important thing is to have their data as close as possible, but far enough away to ensure there’s not a common risk between geographies. The further apart locations are, the more availability and recovery challenges there are – and of course cost and latency (affecting communications, user experience, and so on).

It’s also important to know where data is stored, as compliance obligations – whether explicit or implicit – sometimes restrict the flow of data across EU borders, and many cloud-based solutions have multiple back-end data centres spanning multiple regions.

Knowing where their data is being sent allows businesses to dictate risk aversion or assumption. To win new outsourcing deals, cloud providers will be upfront about where an organisation’s data will be sent. Additionally, the provider will demonstrate that it can meet the client organisation’s RTOs by offering a service level agreement (SLA) that both IT and executive management can understand.

What data handling responsibilities must a business meet?

One issue that complicates the matter of data transparency is the fact that the data businesses manage isn’t just data that’s critical to operations – it’s personal data entrusted to the business by its employees and customers.

Many organisations have to adhere to regulatory requirements which require businesses to handle sensitive data in accordance with a specific set of standards. Under the EU’s General Data Protection Regulation (GDPR), for example, organisations handling personal data belonging to EU members will be responsible for ensuring that information is protected and are responsible for breaches of this data. The GDPR promises citizens the right for data to be forgotten, easier access to one’s data and a right to data portability. This responsibility extends to third-party cloud providers, which is why transparency into service providers’ data management practices is crucial.

In the wake of Brexit, UK businesses might expect that GDPR is no longer relevant, but they’d be mistaken. GDPR analyst Chiara Rustici is one of many pundits who argue that UK companies should continue forging a path toward GDPR compliance. The reason, she argues, is that GDPR will affect UK businesses serving EU customers. GDPR isn’t so much about where the company handling the data resides, but rather where the person to whom the data belongs resides.

Even if GDPR were removed from the picture, UK businesses would still need to be aware of how their and their customers’ data is being handled in the cloud. Some businesses, for example, have mandated data retention time frames for specific types of data, such as the six-year retention period for payroll information, as required by the Taxes Management Act 1970.

For cloud vendors to reassure businesses that they can protect sensitive data, they’ll emphasise their encryption and archival practices. In the event that an individual invokes their right to be forgotten as per GDPR, cloud providers should be able to identify all the places this data resides and provide the client organisation with a written record of the applicable records’ destruction.

Again, successful cloud vendors will be those which back all of the above guidelines with an SLA that includes predefined, clearly outlined terms.

How much does price matter?

Price has long been touted as a benefit of moving to the public cloud, and public cloud providers are continually competing for customers by slashing prices. In 2013, for example, RightScale reported that the four public cloud providers (Amazon Web Services, Azure, Google and Rackspace) rolled out a total of 25 price drops, up from 22 in 2012. When it comes to overall cost reductions, the providers are in a constant battle. In 2012, Azure had the most cuts, only to be edged out by Amazon in 2013. These price wars have continued into 2016. However, this so-called race to the bottom draws the focus away from the more important issue of data transparency.

Today, while cost is important, it’s not the top driver for cloud adoption. Research released by 451 Research earlier this year indicated that customers are concerned with cloud providers’ ability to provide value in terms of managed services, especially with regulations requiring strict data protection measures. In Europe, 451 Research assigned customers a 12 per cent Cloud Commodity Score (CCS), which measures price sensitivity – the higher the score, the greater the impact of price on adoption.

If a cloud provider is unable to meet an organisation’s need for data security and comprehensive support, the organisation won’t hesitate to invest more in a provider that can meet its needs. For cloud vendors to be able to win more deals, they should focus on value-added services – not cost.

Data transparency is a legitimate concern for businesses, but it needn’t be a barrier to cloud expansion. Competitive cloud providers will be upfront about their data handling practices and work with their clients to help them fulfil their compliance requirements.

Although security is one of the most talked about topics in the IT channel today, there’s a widespread lack of education and awareness in the workplace. Small and medium-sized businesses (SMBs) are welcoming more technology into their everyday environment, but the rapid development of this technology is also accompanied by changes in cybersecurity and Internet threats.

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Here’s a slightly different take on a widely analysed space: IHS Markit has put Amazon, Google, IBM and Microsoft as leaders in the cloud IT infrastructure services sector – but put Amazon at the left of the others.

The analyst house released its cloud services scorecard which provides an interesting examination of the landscape – certainly different in its approach to Gartner’s Magic Quadrant for instance. The graph is divided into three segments; challengers, established players, and leaders. Assuming the two axes, of market presence and momentum, average at 3.0, any organisation which scores higher in both is automatically in the leaders’ square.

It’s a clever way of putting the crosses in the box. Other vendors in the scorecard included CenturyLink, Equinix, Rackspace and Verizon in the established bucket, and Salesforce as the only challenger.

“Leadership in the cloud IT infrastructure services market requires very strong in-house software development skills, and all the leaders in our scorecard have a long history of innovation,” said Cliff Grossner, senior research director for data centre, cloud and SDN at IHS Markit in a statement. “This is not expected to change moving forward.”

Grossner added: “Established players, meanwhile, are able to leverage an existing services client base to which they can offer operational efficiencies. Although they have lower market momentum than the leaders, their significant presence indicates strong adoption of their solutions.”

Gartner’s Magic Quadrant arrived late last week, with Amazon Web Services (AWS), Microsoft and Google clearly holding the first three positions in that order. The former two were, for the second year running, the only vendors to make an appearance in the leaders’ section, while Google was the only company which found a place in the visionaries’ pile.

IHS and Markit, both analyst firms in their own right, announced a merger in March, with the details being fully ironed out in July. You can find out more about the report here (subscription required).

Agile IT has been widely heralded (and equally widely decried) as a way to align the pace of change in IT with the pace of change in the broader business.
At its core, Agile IT is making the very basic point that if in house IT cannot keep pace with the business there are a rapidly increasing number of cloud and SaaS providers for whom that is not a problem.
In short, IT must innovate around time to market or die a death of a thousand credit card cuts as individual developers outsource the IT they need to Amazon and other public cloud providers.

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While visiting a customer last week (a large SaaS platform company), we started to have an interesting discussion around Service Level Agreements (SLAs) during which he encouraged me to write this blog.
When I was tasked with setting up the QoS Team at DoubleClick in 1999, the primary mission was to setup a monitoring team (internal, external, etc.) and the secondary mission was actually an accidental one: to manage our SLAs.
This became a hot priority in 2001, we paid out over $1 million (in real money) in penalties for SLA violations to a single customer. Basically, someone on our side signed a contract with insane service commitments like 100% uptime.

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Today we can collect lots and lots of performance data. We build beautiful dashboards and even have fancy query languages to access and transform the data. Still performance data is a secret language only a couple of people understand. The more business becomes digital the more stakeholders are interested in this data including how it relates to business. Some of these people have never used a monitoring tool before. They have a question on their mind like “How is my application doing” but no idea how to get a proper answer.

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Cloud storage firm Dropbox has announced a new customer win in the form of sports brand The Adidas Group.

The announcement, which appeared on the firm’s official blog this morning, explains how Adidas is utilising Dropbox Enterprise, which was launched in November last year, to have ‘fast, reliable access to…data’ and ‘seamless collaboration’ for its employees.

“At the Adidas Group, we want to provide our employees with the best tools they need to get their work done,” said Soren Schmidt, collaboration and mobile director in a statement. “When selecting a technical solution that is meant to change the way people collaborate, usability and simplicity were among our most important criteria.

“The strong adoption of Dropbox Enterprise among employees shows us that we made the right choice.”

Dropbox Enterprise was launched as an attempt to bridge between the traditionally friendly user experience and the grunt needed to managed ‘tens of thousands of users’, as the company put it at the time. Among the new functions presented to enterprises included a suspended user state option, which gives greater control if an employee leaves the organisation, and custom branding.

Elsewhere, Dropbox announced last week the beta availability of Dropbox Paper, a collaborative tool which has been linked by practically the entire tech media as a competitor to Google Docs. Users can create to-do lists, take meeting notes and brainstorm ideas including text, videos and images.

The release, which is available on Android worldwide and will be ready ‘soon’ for EU users on iOS, comes at a particularly interesting time after Salesforce announced its intent to buy Quip, a similar company in the space, for $582 million last week. Writing for sister publication Enterprise AppsTech, Alex Gorbansky, CEO of Docurated – another collaboration firm – discussed the deal’s importance in the context of the sphere’s maturation.

“The entire customer lifecycle, from sales, to account management, to support, is highly content intensive,” Gorbansky wrote. “Owning the content stack will make Salesforce more sticky and, more importantly, provide them with invaluable data and insight around which content is most effective at driving deals.”

According to figures released by Dropbox a year ago, the company had exceeded 400 million users, with eight million business customers on board. Figures from Statista argued the cloud storage firm had exceeded 500 million overall users by March this year.