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4 Questions You Must Ask Your Cloud Provider

Posted on Apr 11, 2012

Make sure you weigh the benefits with the risks before moving to the cloud to store or access business data.

Many small companies are working in the cloud without fully understanding the potential business and legal liabilities, according to an article in Texas CEO Magazine.

Small users usually cannot negotiate terms of service for the service and therefore are more likely to sign legal documents they may not understand.

But if you’re able to negotiate, here are four questions you should address before signing on the dotted line:

  1. What happens when you stop using the cloud service provider? You want a clearly defined closure that includes the data format and cost for moving data to another location. Not addressing this could lead to an expensive and frustrating migration.
  2. Does the provider delete data after termination? It’s essential that your old provider not keep your data, including accounting and customer information. Your provider should be required to delete data from their system and protect confidential data at all times.
  3. What are the data backup obligations? Your agreement should have a plan that clearly defines how customer data is protected if a disaster happens.
  4. Are data and trade secrets protected? Confidential information and trade secrets must be protected. The article recommends being able to show, via an audit, that only the trade secret owner can access the protected information.

Source: Texas CEO Magazine, March 2012