Cloud computing has recently come under scrutiny. It started with Amazon Web Services. In April, sites that Amazon was hosting completely went down and customers could not log in. Then Microsoft and Google had their own problems (see “Major Amazon Outage Ripples Across Web”).
In my opinion, cloud computing was never a complete solution to meeting compliance needs; it was always a solution to reduce technology overhead. I would still encourage cloud computing as an option, but a correct design is critical. Here are two steps you should take into account in your design:
Ensure any data stored on a cloud is encrypted. Should someone actually hack into the cloud, they will most likely move to some other data that is not encrypted. The hacker probably spent a lot of time trying to hack into the cloud. They want information fast, and encrypted data slows them down.
Use a third-party backup service or backup in your office. Although all cloud services have some type of backup service, it is a good idea to have an unrelated secondary backup. The most cost-effective way to implement this is to have the backup in your office. You will mostly likely need some tech assistance to implement the process.
I still think cloud computing is a great idea long term, but it is manmade, so it’s prone to errors. Protecting yourself from these errors is not hard and will go a long way to an effective solution.
Ash Bhatnagar, CFP®
RIA Independence Co.