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Service Level Agreements in Grid and Cloud Computing Environment: Real Protection for Customers?

Investigate if SLAs in Cloud Computing truly safeguard customers, examining legal instruments and market practices. Recommendations for policymakers and businesses.

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Service Level Agreements in Grid and Cloud Computing Environment: Real Protection for Customers?

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  1. Service Level Agreements in Grid and Cloud Computing Environment: Real Protection for Customers? Davide M. Parrilli Interdisciplinary Centre for Law and ICT (ICRI), K.U. Leuven, IBBT, Leuven IT Law Firm time.lex, Brussels Belgium

  2. Motivation, problem area (I) Research question: do SLAs in Grid and Cloud computing scenarios adequately protect customers (businesses and consumers)? Reason: need to build trust in Grid and Cloud technologies – their success depends on the trust that the customers have towards technology and service providers!

  3. Motivation, problem area (II) Legal instruments can facilitate or impede the creation of trust by customers and the business success of Grid and Cloud. The lack of adequate legal tools aimed to protect clients in business relations may be a risk for the existence of the Grid and Cloud market (service provision + technology provision).

  4. Research Objectives (I) We investigate whether • SLAs currently adopted in the market (mainly by big providers), and • The existing European legal framework protect (and, if so, to what extent) customers of Grid/Cloud suppliers and service providers. Can this protection (if any) help to build trust?

  5. Research Objectives (II) Topics covered: • Security and liability risks for clients: what if their data get lost or damaged? • Risks for SMEs: are they enough protected? • Suggestions for the policymaker: a lot of things to improve!

  6. Research approach, Methodology Methodology: analysis based on: • Results of BEinGRID (study of 25 Business Experiments); • Review of the literature; • Analysis of the SLAs adopted by big technology/service providers (e.g. Amazon, Sun, Google, etc). – SLA for Amazon CloudFront/Elastic Compute: the customer does not have contractual guarantee that the promised QoS and availability will be respected or the data will be always secure: Amazon is, in practice, never obliged to respect the SLA and is never liable!

  7. Major Outcomes/Results (I) • The limitations of liability in favor of the provider, and • The lack of contractual guarantee that the service will be delivered as promised and that it will be secure should be considered as business practices.

  8. Major Outcomes/Results (II) Law and economics analysis: • SLAs usually adopted in the market are not efficient – they do not stimulate the provider to make all possible efforts to respect the contractual obligations and to invest in innovation and infrastructures; • Such SLAs do not contribute to build trust in Grid and Cloud technologies.

  9. Major Outcomes/Results (III) To what extent does the European legal framework protect customers (and limit the applicability of SLAs)? B2C: consumer is only who is acting outside his trade or profession: • Applicable law: ex Rome I Regulation the law of the country of residence of the consumer is mandatorily applicable if the provider directs his activities in this country (case-by-case analysis) – this if no option/choice of law is stated in the SLA!

  10. Major Outcomes/Results (IV) E.g.: SLA with a Belgian consumer regulated by laws of California (choice of the parties). Is it valid? YES – but also mandatory rules of Belgium (country of residence of the consumer) will apply – rules to protect consumers. Consequence: many provisions in commercial SLAs are void and not enforceable according to European consumer protection rules.

  11. Major Outcomes/Results (V) • Competent court: Regulation 44/2001: • SLA between a French consumer (A) and a German provider (B): A can sue B in Germany and France; B can sue A only in France; • SLA between a French consumer and an American provider: French national rules will apply. Place of residence to be taken into account (no nationality)! B2B: parties are free to state what they want as a rule: risk for businesses not to have any protection (also SMEs)! Tips: buy services from different providers and negotiate the SLA as much as possible.

  12. Conclusion and outlook Tips for the European policymaker: • Lack of legal rules: create trust based on legal rules and principles (reputation is not enough); • Revise the notion of consumer or state the nullity of unfair provisions tout court; • International cooperation for enforcement of decisions outside the EU; • Label for companies that adopt fair and balanced SLAs??

  13. Thank you for your attention! Davide M. Parrilli Interdisciplinary Centre for Law and ICT (ICRI), K.U. Leuven, IBBT, Leuven (Belgium) davide.parrilli@law.kuleuven.be IT Law Firm time.lex, Brussels (Belgium) davide.parrilli@timelex.eu

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