“If computers of the kind I have advocated become the computers of the future, then computing may someday be organized as a public utility just as the telephone system is a public utility . . . The computer utility could become the basis of a new and important industry.”
— John McCarthy, MIT Centennial, 1961
“Cloud computing” is a term used to describe the use of computer resources not solely as a communications protocol (e.g., the Internet), nor solely as a content or transaction host (World Wide Web), but as an application development and information processing service. To help explain further, to send an email, much like using the telephone, it makes no difference who your provider or host is or which carrier you use. There is a protocol that allows interoperability across networks and processors, and as long as the sender and recipient have an email address and access to an Internet connection, the email gets through. On the web, with access to the Internet and a browser (technology that displays content and functionality hosted at a particular Internet address), you can interact with the website – you can see the material displayed and you can "select" (click) to enable certain features.
Today, as a general rule, if you wanted to create, edit, spell check, save, send or share most content or information with someone, unless you plan on typing and formatting a very long email, you still need word processing, spreadsheet or presentation software programs to create and upload (communicate or store for display), or to see and use content that you might download. In a cloud-computing environment, all of these functions are resident in the "cloud." Imagine that you no longer needed a desktop or laptop computer processor, and all you had were input and display devices (e.g., keyboard, mouse, monitor), which you could either carry or borrow wherever you went. Plug into a universal "outlet," enter your unique pass codes and authentication information, and you have everything you need – where and when you need it. Like telephone, electric or gas service, computing becomes a commodity accessible virtually anywhere and anytime, generally priced by usage, the applications, and the amount and type of storage for which you want and need access.
Cloud-computer services can be sold and paid for using plans not dissimilar to phone service – per call, per minute, unlimited, features, functions – and they disaggregate the user, whether individual or business enterprise, from the procurement, maintenance and operations of the underlying processors and software programs. Clouds can be public – made available to anyone on demand (think Wi-Fi registration based hot spots) or private (large companies can operate or arrange to have someone operate a closed-cloud environment). I summarize the basic characteristics of cloud computing as follows:
- Flexibility – the user can easily modify use, resources, demand, access and virtually every other resource, without the need to purchase or dispose of any equipment or software, other than input and output devices. Increases or decreases in processing, development, storage or other requirements can be managed easily in real time and on an infinitely scalable basis.
- Cost – commodity or utility pricing lowers user costs. Capital expenditures can be eliminated, license fees reduced and access fees managed more efficiently.
- Resources - shared resources enable lower per-user, per-unit pricing, and optimization of peak and non-peak loads across user communities. Resource upgrades and enhancements can be amortized across a broad user base, seamlessly and transparently to the user community. Inter-exchange agreements between cloud providers will enable continuity and recovery, load management, and resource backup capability at optimal prices.
- Independence – time, space and resource constraints become largely irrelevant to the extent Internet or web access is available.
- Interoperability – absent unique or customized requirements that can be managed separately by the user, standardized applications, development tools and protocols are simpler to maintain and operate, debug, update and support.
While security and privacy is always a concern – more so where data, in addition to processing capability and storage, becomes more concentrated and accessible rather than distributed – more users and businesses will have the potential benefit of stronger security measures than are currently affordable or in use, to the extent cloud providers can develop and implement strong security standards and protocols within their service offerings.
So who are the actual or prospective players? Well lots of prognosticators and labelers are out there, but here is my list in basic categories:
- Providers are those who procure, create, host and manage cloud resources and then sell access, services, features and functions in a cloud environment – wholesale or retail
- Users are those who need to use and take advantage of cloud services, features and functions, whether individually or as part of a business
- Intermediators are those who create intermediation and aggregation opportunities between and among providers. On the one hand, intermediators can bridge gaps between providers and create interface and sharing environments between or among providers. On the other hand, intermediators may begin finding niches in customizing or aggregating services, features or functions for particular industries or in particular regions.
- Developers and supporters are those who develop utilities, applications, tools, features and functions to enhance the cloud experience, make additional services and applications available, and who maintain and support the efficient functioning of the cloud environment.
There may be others – my list is not intended to be comprehensive or even definitive. I don’t have a crystal ball, so time and experience will determine what we cannot now predict. Four computers, interconnected to respond to the perceived vulnerability of centralized computing, were the origins of the Internet. Distributed computing represented commercial attempts to amortize costs, decentralize institutionalized information, and enable greater redundancy and recovery capability. Networking and web-based computing gave us the ability to communicate, share and store information across multiple processors and devices through share protocols. While it’s still too foggy to tell what the future will bring, cloud computing represents the next big innovative thing in making the power of the computer and the Internet easier to use, more available, more interoperable and more cost-effective.
When the fog starts to lift, we may see clouds on the horizon. Whether they are storm clouds or fluffy wondrous sights of joy, I leave to your imagination. Stay tuned. But no matter what your visions of the future may be, if you see a cloud and you aren’t sure what the legal implications might be, please feel free to contact me, Joseph I. (“Joe”) Rosenbaum, or the Reed Smith attorney with whom you regularly work.