IT Contracts in the Cloud (Part 1)

IT contracts for cloud computing are starting to evolve as organisations start moving into the cloud.

There are many definitions of “cloud computing” but the most commonly cited is the one used by Gartner:

“A style of Computing where scalable and elastic IT capabilities are provided as a service to multiple customers using Internet technologies”.

Although not perfect (it does not encompass so-called “private clouds”, where the relevant infrastructure is owned by or operated for the benefit of a single customer), the definition does encapsulate the key attributes of cloud computing”:

• Scalability – computing capacity (whether processing or storage) can be varied to meet a customer’s specific requirements;
• Elastic – scaling can happen quickly in response to demand;
• Shared – it is often shared by many customers;
• Internet delivery – this translates into location independence for both customers and service providers: customers can access the services anywhere with suitable communications links and service providers can build their data centres wherever it is most convenient. This also means that a customer’s data can be processed in more than one location that are in another country (hence the cross border data privacy provisions in our proposed data privacy law, POPI).

The term “Cloud” can be interpreted as a reference to the cloud symbol frequently used in network diagrams to represent the Internet. In the context of cloud computing, the data centre hardware and software is what is often meant by the Cloud.

Tags: cloud computing, PaaS, SaaS