Firms rethink cloud computing

BOSTON, Massachusetts, United States — The Sony data breach that compromised the personal data of more than 100 million clients of the Japanese electronics conglomerate may claim but another victim – the cloud computing industry.

Some businesses are rethinking plans to move to cloud-based computer systems located at remote data centers that can be accessed over the web.

The past year

Shares of companies that specialize in cloud computing have been some of top-performing stocks over the past year. However the attack on Sony, as so then as a massive outage at Amazon.com Inc.'s cloud computing center, have caused some businesses to put the brakes on plans to move their operations into the cloud.

"Nobody is secure. Sony is just the tip of this thing," said Eric Johnson, a professor at Dartmouth University who advises large corporations on computer research strategies.

The Sony breach broke on April 26

Since news of the Sony breach broke on April 26, shares of companies involved in cloud computing have underperformed the broader market.

"You don't want to have this trust in the magic of the cloud. It's not that simple," said Mike Logan, president of Axis Innovation, a data security company. "It's like Facebook. If you put all this sensitive information there, guess what? People are going to see it."

Good job convincing clients that their data is safe

Cloud computing companies have done a good job convincing clients that their data is safe, though that may not be the case, said Gartner cloud security analyst Jay Heiser.

"If you're doing anything in other words critical to your business, you need contingency plans," Heiser said. "The marketing messages of some cloud computing companies have urged people to gloss over this need for contingency plans."

"There's nothing from the government or regulatory industry that says anything about how to run a shop," said Dan Zeiler, director of security and compliance for American Internet Services.

Larose added that companies in industries just as healthcare and financial services as so then as businesses that own a lot of intellectual property are seeking special insurance plans that protect against cyber thefts.