Cloud computing: Businesses still don't know what they're getting into

The European Commission moves forward with plans to simplify the buying of cloud services for business, which it says is still confounding businesses.

Cloud service contracts are still too complex for many businesses to grasp the potential risks and liabilities, according to Europe's digital agenda commissioner, Neelie Kroes.

Businesses are buying into cloud services without fully understanding what they're paying for and what they can expect from the service, Kroes wrote in a blogpost on Friday.

"One of the big barriers to using cloud computing is a lack of trust. I think you should be able to know what you're getting and what it means — and it should be easy to ensure that the terms in your contract are reasonable: open, transparent, safe and fair. Even if you don’t have a law degree," she said.

To address this confusion, the European Commission wants to make available boilerplate contracts which businesses could use when buying cloud services.

The commission has put out a call for experts — academics, lawyers and end-users — who can advise it on how to draw up these contracts, which will be made available in 2014.

These "sensible, plain language contracts" will be designed to spell out clear service level agreements and what a businesses' rights are on a range of issues, such as which third parties would be able to access a businesses' information or whether a firm will be notified in the event of data being stolen.

Drawing up model contracts for cloud services is a "key pillar" of the European Cloud Computing strategy, the document published last year . The strategy sets out the commission's plan to resolve the "jungle of standards", contractual issues and differing national legal frameworks .

The commission hopes these measures will boost uptake of cloud services in Europe, particularly among small businesses.

Small firms are the most likely to be nervous about commiting to a cloud service "because of fears that they will not meet their legal obligations, or who might be worried that they get locked in or stranded by changes of technology or service by cloud providers", Kroes wrote.

"It is those same small businesses who stand to gain particularly from the cloud. Services that are flexible and adaptable, without high start-up costs, can really help those smaller companies boost Europe’s growth and jobs."