Popularity of Cloud Services Points to Increased Risk Responsibility for the Consumer

As cloud services continue to attract an increasing portion of the market for enterprise software, we think it’s highly likely the consumers of these services will end up assuming more of the risk management responsibility for their own accounts, and for all of the priority data associated with them.

As cloud customers begin to grapple with how best to mitigate the risk of shifting daily computing procedures for whole organizations from on premises systems, we think it is safe to assume a heightened attention to online security concerns will finally begin to unfold. Certainly heightened attention would be a good thing, but the question will still loom as to how to truly mitigate risks and protect corporate proprietary information from malicious attempts to subvert it.

On August 8, 2013, the CIO blog of the Online Wall Street Journal published a post by Rachel King, titled <a href=”http://blogs.wsj.com/cio/2013/08/08/cutting-cios-out-of-cyber-insurance-decisions-is-a-bad-idea/?mod=wsj_ciohome_cioreport” rel=”nofollow” title=”click this link to visit the CIO blog of the Online Wall Street Journal to read about a post by Rachel King, ‘Cutting CIOs Out of Cyber Insurance Decisions is a ‘Bad Idea'”>Cutting CIOs Out of Cyber Insurance Decisions is a ‘Bad Idea'</a>.

The point of Rachel King’s post is to sound a warning. Enterprise business will do better to allow CIOs to participate in the decision-making about how best to leverage risk underwriting by a third party insurer to protect corporate assets as they are exposed via online services.

While we agree with her point, we think it’s worth taking a moment and simply reflecting on how different the enterprise computing environment of 2013 has become in comparison to conditions a mere 5 years back. In 2008 it was highly unlikely most enterprise businesses would plan on shouldering their own risk management for online services. Back then, cloud service providers shouldered almost all of this responsibility, at least to the best of our knowledge.

Of course, a big question is what impact, if any, shifting risk responsibilities at a business to business cloud computing level will have on business to consumer services like online banking, etc. How will retail customers deal with a need to shoulder their own online risk management? We can’t think of a plausible answer to this one.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2013 All Rights Reserved

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