New legislation required for future online transactions?

In the last weeks of April, the largest cyber attack ever took place when criminals successfully hacked into Sony's two online gaming networks, PSN and Sony Online Entertainment. Financial details of millions of online customers worldwide were extracted during the cyber attack.

As an immediate outcome of this disaster, Sony faced several lawsuits. Also on a broader level, this disaster has provoked drastic consequences. In the US, Republican Mary Bono Mack, who heads the Commerce Committee's Consumer Protection Panel, said she would introduce a new bill. According to her and others, the existing legislation falls short in obligating companies to secure sensitive information and to timely inform clients about such security breaches. Because more and more people become active online purchasers, large online companies such as Amazon, Sony and Apple contain vital financial information of an increasing amount of people, to such an extent that legislation should become updated to make companies safeguard this valuable information. Not only is an increased security needed, but also concerns about privacy and the potential trade in personal data should be considered.

Does this security breach mean that online consumers should doubt the security of their online transactions on all e-platforms? Are iPhone users OK with the fact that Apple can track their users? This matter can also be applied for companies; should companies which purchase online services such as cloud computing also be worried?

The cloud up ahead

Cloud computing has been looming over the business world for some time now (pardon the pun). The arguments for and against the adoption of cloud computing are well known: cost reduction and increased agility versus potentially decreased security. Can anything new be added to the argument? Actually, there have been several recent developments that, unfortunately, while relevant to the conversation about cloud computing, may not help advance the argument in one way or the other.

On the one hand, the increasing trend towards more mobile and powerful personal devices like the iPad (and ensuing tablets surely to come) and the Kindle point towards a consumer need to access data remotely, a feat most easily accomplished through the cloud. On the other hand, rising concerns about the privacy of information (think Facebook, Wikileaks and Blackberry in the UAE) seem to point in the direction for a desire to maintain proprietary control over data. Understanding that a company is but a collection of the individuals that work there and that, therefore, business decisions are usually reflections of those individual's tendencies, these two developments in the retail realm may help to understand businesses' future acceptance for cloud computing solutions.

The discussed trends, each pulling the argument is opposite directions may actually shed some light on the future of cloud computing. It seems that the most probable result is that rather than being a zero-sum game in which cloud computing solutions can only be adopted at the expense of more traditional in-house solutions, cloud computing will be adopted in those cases in which the need for flexibility and cost-reduction out-weight privacy concerns. Such a future may mean that potential businesses that once failed to get off the ground due to crippling IT costs may now flourish through the help of third-party servers and applications until their need for privacy and security is matched by their ability to afford secure in-house solutions.