Will using Dropbox put your CEO in jail?

Stephanie Tayengco of Logicworks, Luke Kanies of Puppet Labs, Richard Nicholson of Paremus, and James Urquhart of enStratus at Structure 2012
Stephanie Tayengco of Logicworks, Luke Kanies of Puppet Labs, Richard Nicholson of Paremus, and James Urquhart of enStratus at Structure 2012

Stephanie Tayengco of Logicworks, Luke Kanies of Puppet Labs, Richard Nicholson of Paremus, and James Urquhart of enStratus at Structure 2012. (c) 2012 Pinar Ozger. pinar@pinarozger.com

With everything moving to the cloud, companies suddenly find themselves confronted with a whole new set of challenges. For example: Is all that stuff even legal? “There is a good chance that almost every organization that is out there that is using Dropbox or that is using Box is breaking the law,” proclaimed Puppet Labs CEO Luke Kanies (see disclosure) during the last panel of the day at GigaOM’s Structure conference Thursday.

Kanies wasn’t out to scare people, but he had a point: Most companies don’t even have internal rules for the use of data with cloud services, save for a clear understanding of the law. Fellow panelist and enStratus VP of Product Strategy James Urquhart agreed, pointing out that courts have yet to decide whether Fourth Amendment rights apply to documents saved in the cloud.

But legal issues like these are only one of the challenges facing companies as they move away from infrastructure-centric to app-centric architectures. The other is that people have to adopt an entirely new way of thinking. “A lot of organizations have problems with the application structure,” said Paremus CEO and Founder Richard Nicholson, and his co-panelists agreed: Putting apps at the center makes it necessary to rethink how companies are spending their money, and who makes the decisions about services. For example, Logicworks VP of Network Operations and Engineering Stephanie Tayengco said that she sees a lot of IT requests come from creative types, as opposed to more technically-oriented CIOs.

Of course, that shift also comes with tremendous opportunities: When IT provides a platform that allows people to experiment with apps as opposed to having IT sign off on every single project, great things can happen. And if IT isn’t ready for that, employees will just bring their own services to the work place and upload things to their personal Dropbox account. “One of the reasons is that if you ask your IT, whatever the question is, they say no,” quipped  Kanies. So people don’t ask, but start doing. Which is great, despite any potential legal challenges. Said Kanies: “It can be a low-risk way of letting that small team play with something.”

Disclosure: Puppet Labs is backed by True Ventures, a venture capital firm that is an investor in the parent company of this blog, Giga Omni Media. Om Malik, founder of Giga Omni Media, is also a venture partner at True.

Check out the rest of our Structure 2012 coverage, as well as the live stream, here.

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