Business, Operations and Technology Implications of Cloud Computing 

Building & Managing a Sustainable Cloud Service

Business, Operations and Technology Implications

Gary Matuszak — Global Chair, Information, Communications & Entertainment, KPMG LLP — There are a number of issues that cloud computing vendors need to address, and you can segregate them into various aspects. Clearly, from an internal perspective, there are things they need to deal with around the accounting for these arrangements, particularly those companies that are transitioning into a cloud computing model and have historically sold a product or licensed a software tool or a software product; other things such as tax implications. So, these are all internal but, also looking at the operational aspects of it, from IT security, how do you offer your customers a service that gives them comfort that it is secure.

Kieran Lane — Asia-Pacific Chair, Information, Communications & Entertainment, KPMG Australia — All around the world, privacy laws differ. So, if its going to go in another cloud and the data centre sits in, let’s say, Singapore, and you are transporting the information across to Singapore, what is the privacy issue associated with it — both inside the country of origin and also the country overseas.

Tom Lamoureux — Risk Advisory Services Leader, Global Information, Communications & Entertainment, KPMG LLP — One of the things that we have looked on our work with a number of computing companies around is providing certification services and the services that provide an opinion around the effectiveness of controls and security at cloud computing companies.

Kieran Lane — So, the vendors, the question they are asking is where to put their data centers because cloud computing actually requires data centers to be located throughout the world. And really, that is an energy question that is also a security question. So, what they are attempting to do is work out the best locations to put their data centers. So, the questions they are asking are what are the tax laws, what are the business processes, what’s the regulatory environment.

Tom Lamoureux — Other areas that need to be thought about are, in the revenue stream that is created how do you have a constant interaction with your customer. Maybe on a daily, or even hourly, or even minute-by-minute basis, you are collecting data and information about how the customers are behaving with your cross-service offering. That’s a very different dynamic then if you are shipping a product to the customers that are going to install and use it themselves.

Gary Matuszak — There are a number of very large mature organizations, both software companies and others, who are transitioning from their current business models of selling product to host and offer services in the cloud, and we are also seeing a very young start-up companies that are coming up with new business models. One of the things that is important is to work with an advisor who has worked with these types of companies before.

Tom Lamoureux — We understand cloud computing and how its being deployed and all the rules and regulations, from tax to security and privacy, that exist in different parts of the globe. There are some important differences, and as cloud providers offer these services globally, and we do think it is a global phenomenon, KPMG is there to help our clients understand locally how they’ll be impacted and what’s the right thing to do from a local jurisdiction perspective.

For more on cloud computing, please visit kpmg.com/Cloud