The Lawyers Weekly - June 4, 2010

JAMES
KOSA

Lawyers aren’t usually early adopters of new technologies. It often takes us a little while to warm up to the latest technological trend. There are many reasons for this, but it all boils down to one core trait: lawyers are risk adverse — and ne w technologies tend to be risky.

Cloud computing is a new technology that is making the rounds. Many businesses have jumped on board, but lawyers have been predictably slow to do the same. Is our reluctance to embrace this technology justified?

Cloud computing refers to a variety of technologies that transfer the responsibility for a computing activity (such as storage or processing) from a local computer to a network of remote computers over the Internet. The remote computers are generally operated by a third-party cloud service provider.

Low cost is the main reason to move services to the cloud. It is often more attractive for a business to pay someone else a monthly fee to provide computing services than to invest in all of the IT infrastructure and pay to maintain it all itself. Typically, a cloud provider charges some kind of usage fee based on the business’s usage of computing resources. For example, if a business was using the cloud for storage, the cloud provider would charge for the storage space used.

There are other advantages to
cloud computing. Generally, cloud
computing technologies are easily
scaled to meet a business’s
demand. It is a similar concept to
paying for any other utility — if
you need it, and are willing to pay
at the applicable rate, the cloud
can provide it on demand. Another
advantage is that the cloud
her professional obligations and
applicable privacy laws.

appears to the business as a single resource, when in fact it may be composed of many computers in different locations (and perhaps owned by different third parties). This trait makes the cloud comparatively simple to use.

Cloud computing is becoming a
big business. It was worth $50 bil-
lion worldwide in 2009, and is
expected to head north of $150
billion by 2013. Whether we are
aware of it or not, much of our
daily computing (e-mail, banking,
etc.) may move from dedicated
servers to a cloud environment
over the next few years. Google
Docs, including Gmail e-mail
accounts, which are used by mil-
lions of businesses and people
worldwide, are already hosted in
Google’s cloud.

James Kosa is an associate of
Deeth Williams Wall LLP in
Toronto. He practises information
technology and intellectual prop-
erty law with an emphasis on pat-
ents, copyright and licensing.

Companies need to establish social networking policies

Social
Continued From Page 10
boards, and recommends that a
company’s disclosure policy pro-
hibit employees from discussing
corporate matters.
If the company website allows
visitors to send e-mails to the
company, s. 6. 13 warns against
the risk of selective disclosure
when responding to the e-mails.
Selective disclosure occurs when
a company discloses material
non-public information to certain
individuals or companies, and not
to the investing public in general.

Recommendations

Regardless of what rules might eventually be adopted, Canadian public companies should be careful that only authorized spokes-persons communicate to the public on behalf of the company, and that people who participate in forum or chat room discussions and who purport to speak on behalf of the company do not engage in selective disclosure.

Companies should also estab-
lish employee policies to deal with
some of the risks of social network-
ing sites. These policies should
cover issues such as privacy, confi-
dentiality, copyright infringement,
defamation and comments by
employees on the business and
activities of the employer. ;