Self-styled financial mayvens and fools, motley and otherwise, are insisting that the "wave of the future" is cloud computing. The bulky and expensive PC will be replaced by a low powered and simple computer that runs a "thin client" software program connected to an Internet Software Services Provider, such as Google. The provider will run the latest versions of spreadsheets, word processors, desk top publishing applications, CAD-CAM programs, Customer Service Management programs, presentation software, database programs and anything else you can imagine, which your business can access for a nominal fee. No more expensive hardware upgrades, no more expensive software upgrades, and every function will be available everywhere on a netbook or equivalent computer. An end to the PC and the beginning of computing nirvana. Well maybe. Or maybe not.
If you have nothing to hide, you have nothing to fear... But everyone has something to hide.
There are a few flies in the hypothetical ointment of the Computing Cloud. The first is that quite a few firms and private individuals are very content to run hand-me down versions of operating systems and software that are just as good for their purposes as the new updated ones, and do not cost anything at all to upgrade. And though we won't talk about it (not "nice") some people actually steal software. None of those people or firms are going to be interested in paying a "nominal fee" each year for the version of whatever it is that includes the latest bugs, when they have a perfectly fine working version of a Word processor, spreadheet, presentation manager and database, which they know how to use and which is compatible with the files they have already created.
Moreover, not all updates can be done smoothly or without changing hardware. Changeover from 32 bit to 64 bit to 128 bit computers and operating systems will require new hardware and new locally installed software. Each major technological change is still going to require junking the old computer, and these will continue to happen every few years to provide better displays better mice or no mouse at all (which would be the best sort of mouse!) bigger and better disks working on new principles, and numerous other innovations. Remember when a computer display took up an an entire desk, in the "bad old days" of five years ago? Or when a 100 MB hard disk was really huge? I remember when 10 MB was a lot of hard disk too. These innovations will all require new hardware no matter what you do. The hardware industry won't stand still, and people will still need some or all of these innovations in the thinnest of hypothetical thin clients.
Another problem is dependence. Everyone who remembers the bad old days of the big central computer also remembers the announcements that flashed across the screen as you were frantically trying to meet a deadline, "Acme central computer will be closing down for two hours in five minutes for maintenance. Please save your work and exit all active programs." The PC freed everyone from that. Supposedly that won't happen in cloud computing, or will it? And nobody guarantees that the cloud computing provider is always going to provide the latest hardware or the full amount of computing capacity that you need. Everythng has limits and everything cost money, and it is always cheaper to provide less rather than more, and to maintain a capacity that is adequate for most of the day and most of the time, but not necessarily enough for peak use.
However, the biggest problem of cloud computing, the show stopper that will make it a no-go for most firms and individuals, is data security. The enthusiasts of cloud computing, asked about security, will spout reams of gibberish about https and unique private keys and prime numbers and 128 bit encryption. Technojargon to awe the uninitiated. The truth is more prosaic. There is no way to protect data against a determined attacker.
As a cloud computing executive said, "If you have nothing to hide, you have nothing to fear." But everyone has something to hide. Every firm has their latest designs in their database and word processors. They have all the contact information of their customers in their CSM database. They have the amounts that they bid on various sealed bid contracts. They have the studies that show their own weaknesses vis-a-vis their competitors. All of this is quite interesting information for competitors and industrial spies. All the fancy security protocols and encryption schemes in the world depend on you being you and not someone else, and they are all vulnerable to identity theft. Identity theft is a multi-billion dollar industry and it is growing, despite the best efforts of ingenious firms to foil it. Once the thief has your information, and can make the system think he or she is you, they can access anything you can access. A disgruntled former employee of your firm, a disgrunlted former employee of the cloud computing service, a dishonest employee or a determined industrial spy can and will get the passwords and counter passwords by phishing schemes, by stealing Wi-Fi signals or by hacking databases. There is no system so foolproof that it cannot be fooled. It happens all the time. And what happens to your data privacy if the internal revenue service (or your wife's divorce lawyer) forces the cloud computing service provider to produce the records?
Do you really have nothing to hide? Are you sure? I thought so. Don't throw away your PC.