A recent article from Steven Hunter, a partner at Quarles & Brady LLP, explains the rising popularity of cloud technology and the benefits it provides.

It’s no secret that cloud computing can save big money. A technology consulting firm, Booz, Allen, Hamilton, estimates that cloud computing can reduce costs by 65% over other systems and can provide a “payback on investments in three to four years.” With cost advantages almost guaranteed, some are still hesitant to switch to cloud computing because of the fear of “the costs and risks associated with conducting electronic discovery” in the cloud. Hunter claims that we needn’t worry, as the “risks associated with conducting e-discovery in the cloud…are remote, manageable and eclipsed by the savings companies should expect from cloud computing.”

Some are concerned with the “potential violation of international data privacy laws [due to] illegally disclosing data in the jurisdiction in which the cloud is associated.” Hunter suggests that in order to mitigate this risk, service agreements with cloud providers should state that:

-None of the company’s data may be stored outside the United States

-Provide a detailed mechanism for how the cloud will implement litigation holds

-Address how metadata will be created and stored in the cloud environment

Another common worry related to cloud computing is “the unintentional waiver of the attorney-client privilege by co-mingling data.” Hunter suggests “establishing security protocols to prevent the inadvertent disclosure of communications to the administrators of the cloud or any other third party.” Risk can also be decreased by using a private cloud rather than a public cloud.

New cloud computing technologies make electronic discovery in the cloud even easier. Facebook recently launched the “Download Your Information” button, allowing users to pull down all of their stored Facebook information in a single click. Hunter notes that this technology can be easily applied to corporate or other data in the cloud.

Hunter concludes, “At the end of the day, in-house counsel should be confident that (if managed properly) the benefit of moving a company’s data to the cloud outweighs the risks and costs associated with producing data from the cloud as part of a lawsuit.”