It’s not often that we get the chance to proclaim that when it comes to cutting edge technologies, the insurance industry has it right, but such an opportunity has certainly presented itself with recent developments on the cloud computing front.
A news report in The Telegraph (London) and many other places on the Web states that at least some of Amazon’s and Microsoft’s cloud-based services were brought down by a lightning strike over the weekend.
Bad weather in Dublin damaged data centers used by the two computer giants, taking out the main power supply and damaging the control systems for the back up generators, the report says. Amazon's EC2 cloud computing platform was knocked offline for the second time this year, after disruption caused in April by a routine power upgrade.
Microsoft's Business Productivity Online Suite (BPOS) was also put out of action, says The Register. Amazon said its back-up power sources had to be manually operated before power could be restored. It took several hours for normal service to be restored for both companies.
So why do I say the insurance industry has it right when it comes to the cloud? Simple. Our industry is by and large a cautious one, and most of what I have heard from carriers and other industry sources on cloud technology is laced with a liberal dose of such caution. Yet my sense is that the caution has been more about data security threats like criminal hacking than about vulnerability of physical facilities.
The lightning strike story reminds me of a much older—but still formidable—threat to our systems and livelihood, namely the frailty of our power grid, particularly in the United States. We’ve known for more than a decade now that we need surge suppressors, redundant power supplies and other measures to guard against the damage of power surges (such as might be caused by a lightning strike). Perhaps we have taken for granted that we are now adequately protected against such threats. If so, the damage to these high-profile cloud facilities should be a wakeup call.
The world is becoming an increasingly insecure place to do business. If you don’t think so, just look at the havoc being caused in the financial markets these days, or the fact that cyber-crime continues to grow despite our best efforts.
The cloud is a useful and often money-saving option for many in our industry. But we are rightfully reticent to trust our most precious data resources to technologies that could be brought down by criminal interests or a random bolt of lightning. Let’s see the protection—both online and physical—get better before we put our critical assets in the line of fire.
Ara C. Trembly (www.aratremblytechnology.com) is the founder of Ara Trembly, The Tech Consultant, and a longtime observer of technology in insurance and financial services.
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