ABSTRACT
One of the most critical aspects in drafting and negotiating a cloud computing agreement is establishing appropriate service levels in relation to the availability and responsiveness of the software. In addition to the appropriate service levels, a vendor must be obligated to resolve issues in a timely manner. Closely related to and often intertwined with an uptime service level is a response time service level. This service level sets forth maximum latencies and response times that a customer should encounter when using the software. The need for data security in cloud computing transactions cannot be understated. Disaster recovery and business continuity provisions require the vendor to demonstrate and promise that they can continue to make the software available even in the event of a disaster, power outage, or similarly significant event. The customer should always address insurance issues in cloud computing situations, both as to the customer’s own insurance policies and the vendor’s insurance.
