INTRODUCTION:

Cloud computing means the use of computing resources such as data, computation, and software which are given to its users as a means of remote service over a network. The name of cloud computing agreements is derived from the cloud-shaped symbol used to represent the complex infrastructure that system diagrams contain. It includes using a provider’s software remotely and storing the customer’s data with the provider. They are somewhat the same as traditional software licensing agreements but consists of much more resemblance with hosting or application service provider agreements.

In other words, a Cloud computing agreement refers to a processor arrangement according to which a client is provided with the software and infrastructure that includes storing the customer’s data so provided with that provider. Generally, in a software and hardware arrangement, a service provider provides the client with hardware or software support for helping the clients in case of any emergency with the software or any other technical issue which they install at the beginning of the agreement. The clients can configure the hardware and software according to their requirement but in the cloud computing system, the client has this system as a commonly shared system in which every customer have the same homogenous requirements. The most famous and big examples of cloud computing arrangements are Google Drive and Amazon Web Services. Cloud services providers aim at providing standard contractual terms which are generally non-negotiable due to the standardized, lower price services, which only differ from norms in the outsourcing services industry they are being used in and from software licensing terms in key ways.

CLOUD COMPUTING AGREEMENT:

In general terms, Cloud computing is defined as the utilization of computing resources, which include data, software, and computation, which are provided to users as a remote service over an online data transferring network. In modern times, there is always a new and better term of cloud services contracts emerging in the market. Cloud computing has emerged as a modern and much more effective means of providing information technology services in the modern-day market.

By using cloud technologies, businesses can be benefitted in ways such as scalable, cost-effective, and integrated IT resources which results in removing geographical or cost limitations upon their work and service delivery mechanisms. Many companies are strong enough for providing completely internet-based services and can maximize the efficiency of their intra-corporate processes. For using such technologies businesses are required to enter into contractual agreements with cloud service providers, which could either be standardized or can be tailored to customers. Negotiation of such agreements goes with help of cloud computing services, by outsourcing the storage, collection, and provision followed by data to servers or processes running on the cloud. They tend to be standard form contracts, with pre-decided terms.

According to Section 10A of the Information Technology Act which grants them legal validity. This includes several risks and concerns which require businesses to conduct appropriate audits and checks before entering into them. checking certification standards set by the Cloud Service Provider (CSP) proves out to be very helpful by allowing clients to enter into agreements safely without having and concerns to conduct audits themselves. The various aspects of the Cloud compounding Agreements are:

1. Data Security and Confidentiality;

2. Liability of the CSP;

3. Change of Services Terms/Termination by CSP;

4. Disputes, Governing Law and Jurisdiction;

5. Data retention and transfer;

6. Negotiating service delivery levels;

7. Fee model and licensing structure.

As CSP agreements are very vendor-friendly, it is important for businesses that want to enter into CSP agreements to be careful of the obligations being imposed upon them and consider it by measuring these appropriately with respect to the benefits of cloud computing technology.

TYPES OF CLOUD COMPUTING AGREEMENT:

They have increasing usage as users want to access functionality and storage quickly without any building complicated, expensive, and time-consuming infrastructure. Cloud services providers have grown rapidly to meet demand, creating an array of services. The three types of cloud computing service which are as follows:

1. Software as a service: The services provider offers an all-in-one platform with application and platform which functionality runs on a cloud infrastructure.

2. Platform as a service: The services provider offers a base-level platform which runs on cloud infrastructure, ready for the customer to install and use its applications instantly.

3. Infrastructure as a service: The services provider offers equipment, storage, or hardware only, with no server or platform software.

KEY ISSUES TO CONSIDER WHEN DRAFTING AND NEGOTIATING CLOUD COMPUTING AGREEMENTS

1. Service availability:

A client must have the benefit to use and at all times have access to his/ her data. In order to resolve the various risks relating to service availability, the provider must ensure that are the correct contractual safeguards. For this, the provider makes sure to have their professional services available at every given period of time making their services consumer-friendly.

2. Service levels:

Reasonable service standards are set up by competent authorities to ensure that the provision of services is consistent with the needs of the consumer. Effective remedies are also very important to ensure that the supplier is motivated to operate in compliance with the service standards imposed on them.

3. Uptime service level:

The service provider must have a secure atmosphere in which the services are available to the consumer minimum during the regular business hours of the client. The provider should then make sure that the services would have an uptime, or availability, of a certain amount, which will be calculated over an agreed-upon duration during certain hours.

4. Response time of operation:

The response time service level sets out maximum response times for a customer’s usage of the services.

5. Concurrent visitors:

If the customer wants the services to serve multiple users, then a service provider should include specifically mentioned in a defined way all such requirements.

6. Question reaction time and resolution time:

The customer must mention in the agreement the provider’s responsibility to timely address service quality problems. Providers should also a reasonable time period from when the problem is identified and start working to resolve the issue.

7. Return of data:

The customer may add a service standard for services involving in the agreement such as a vital business feature or confidential customer details which monitors the time interval between the customer’s request for data and the return of such data by the provider.

8. Remedies:

Remedies for failure to comply with a service level start out as credits toward the next period prove out to be a very important term of the agreement for the customer.

9. Insurance:

The client should always fix insurance concerns, which should be with respect to the customer’s own insurance plans and also the insurance of the provider. If the fault was of the customer or the provider, both should be equally given a fair chance as generally, most data protection and security regulations make the client responsible for any security breach.

10. Indemnification:

The provider should agree to indemnify and keep the customer and its related parties harmless from any lawsuit where there is any violation from the provider's side of his/ her responsibility in terms of confidentiality and data protection of the customer.

11. Limitation of Liability:

The limitation of responsibility of the provider very important as the provider manages all aspects of data protection. The provider should not be allowed to make any use of the liability restriction clause to unduly limit its publicity.

12. Implementation:

In the case when substantial implementation services are offered, the scope of “services” should be broadened in a cloud infrastructure agreement so that it includes all of the services provided.

13. Fees:

Generally, cloud computing service is based on the concept of “pay-as-you-go” or “pay-for-use”

14. Term:

The consumer should be allowed to cancel the arrangement at any time without any damages to be paid to the provider upon fair notice as the software and facilities are provided as a service.

15. Warranties

There are no other protections that are beneficial enough that they are provided in a cloud storage arrangement other than the warranties.

BY-

GAURAV GUPTA