Negotiating Cloud Contracts - Looking at Clouds from Both Sides Now

50 Pages Posted: 10 May 2012 Last revised: 19 Mar 2015

W. Kuan Hon

Queen Mary University of London, School of Law - Centre for Commercial Law Studies

Christopher Millard

Queen Mary University of London, School of Law - Centre for Commercial Law Studies; Oxford Internet Institute

Ian Walden

Queen Mary University of London, School of Law

Date Written: May 9, 2012

Abstract

Contract terms for cloud computing services are evolving, driven by users' attempts to negotiate providers' standard terms to make them more suitable for their requirements, as well as market developments, particularly among cloud integrators.

This paper summarises our research into negotiated cloud contracts, where users have requested changes to providers’ standard terms, and the extent to which providers agreed those changes, based on sources including interviews with cloud computing providers, users and other market actors. The terms that generated most negotiation were provider liability, service level agreements, data protection and security, termination rights, unilateral amendments to service features, and intellectual property rights.

Changes to providers' standard terms are likely to filter down from large deals where users have negotiated amendments, and filter up from regulatory action affecting the consumer market. This paper suggests a multiplicity of approaches are emerging, rather than a de facto ‘cloud’ model, with market participants developing a range of cloud services with different contractual terms, priced at different levels, and embracing standards and certifications that aid legal certainty and compliance, particularly for SME users.

Keywords: cloud computing, contracts

JEL Classification: K2, K12, K20

Suggested Citation

Hon, W. Kuan and Millard, Christopher and Walden, Ian, Negotiating Cloud Contracts - Looking at Clouds from Both Sides Now (May 9, 2012). 16 STAN. TECH. L. REV. 81 (2012); Queen Mary School of Law Legal Studies Research Paper No. 117/2012. Available at SSRN: https://ssrn.com/abstract=2055199 or http://dx.doi.org/10.2139/ssrn.2055199

W. Kuan Hon (Contact Author)

Queen Mary University of London, School of Law - Centre for Commercial Law Studies ( email )

67-69 Lincoln’s Inn Fields
London, WC2A 3JB
United Kingdom

HOME PAGE: http://www.law.qmul.ac.uk/people/academic/hon.html

Christopher Millard

Queen Mary University of London, School of Law - Centre for Commercial Law Studies ( email )

67-69 Lincoln's Inn Fields
London, EC2A 3JB
United Kingdom

HOME PAGE: http://www.law.qmul.ac.uk/staff/millard.html

Oxford Internet Institute

1 St Giles
Oxford, OX1 3JS
United Kingdom

HOME PAGE: http://www.oii.ox.ac.uk/

Ian Walden

Queen Mary University of London, School of Law ( email )

Mile End Road
London, London E1 4NS
United Kingdom

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