"Our customers' chat windows and Web site images weren't loading correctly, which ultimately makes their Web site look bad to visitors, so we had some complaints," recalls Sanchez.
Despite having received about 15 customer complaints, Sanchez is surprisingly laid-back about the ordeal, noting that he never even bothered to contact Amazon for a refund. As far as Sanchez is concerned, the occasional bout of downtime is a small price to pay for a storage service that costs just $35 a month -- a fraction of the nearly $500 a month he'd have to spend to replicate Amazon's storage capabilities with in-house servers.
"As long as an SLA is available for everybody to read, and the vendor isn't trying to hide anything, then you either have to accept the agreement or find someone that you think can provide a better level of service," says Sanchez.
Nor does he subscribe to the notion that a cloud computing contract requires forfeiting complete control of your systems. Rather, Sanchez says that in the event of an outage, SmartJabber can offload the data it stores on S3 onto its own local storage servers in a matter of minutes. "It's not the best solution, but it's something that would keep us chugging along," he says.
Nakajima has a similar emergency plan. Today, as a precautionary measure, Big Canvas' EC2 server temporarily caches users' photos before transferring them to the S3 server.
Despite some complaints, in-house IT departments would be hard-pressed to outperform the service levels currently being met by many providers, including Amazon and Google -- occasional outages and all.
Says Wang, "If you were to compare the amount of uptime that the cloud providers are delivering and what's being delivered by your own internal IT teams, you'll find out that the external ones are doing a much better job, mostly because they're under a higher level of scrutiny."
In the end, it's up to each company to decide how much risk it is willing to take on -- and whether the damages accruing from a service disruption might offset the savings and convenience promised by a cloud computing service.
"Cloud computing is reliable enough that if your business can tolerate the occasional outage, you're just starting out, and you don't have a lot to invest , you can take a chance on it," says Info-Tech Research's Sloan. "You might possibly even build a business on it."
Waxer is a freelance writer in Toronto. Contact her at cwaxer@sympatico.ca.