Risk Management

12:58 PM
Gilad Parann-Nissany, SAP
Gilad Parann-Nissany, SAP
Commentary
50%
50%

The Holy Grail of Cloud Computing – Maintaining Data Confidentiality

Whether a financial institution enters a public or private cloud, data privacy and confidentiality are top concerns. A financial application (or a service) must be protected, and true privacy must be maintained, says SAP's Gilad Parann-Nissany.

Breaking the Trust Paradigm

Current key management technologies, as mentioned above, are either a trust compromise, or a compromise on cloud computing features. Breaking the trust paradigm requires a new approach, specific to cloud key management.

A technology that enables such an approach is split-key management. Here's a financial metaphor which will help to explain how this works, and its benefits. Most contemporary safe deposit boxes utilize a two-key system, the bank has one key while you (the box owner) hold the second key, and both keys are required to open the access door to remove the deposit drawer. This two key system is how the bank provides some assurance that an unscrupulous employee can't enter the vault and start pilfering boxes. Split-key management implements the same concept technologically in the cloud; the "bank" – a virtual key management system – generates a unique key for you, and another key to be used by the key management system. Both keys are required to encrypt and decrypt data, yet at the same time, only you, the end user, have access to your master key, making it impossible for the cloud provider to ever seeing your most critical piece of data – your encryption keys.

[The Rise of Cloud Computing on Wall Street]

Another foundational technology that is important in cloud data security is Homomorphic Key Encryption. This protects the sensitive encryption keys themselves, when they are in use in the memory of cloud servers. The benefit is that the most sensitive information, the keys themselves, are never exposed in the cloud, even when they are actually used. Advanced "partially homomorphic" mathematics enables such innovation.

Going forward, such technologies, integrated with financial clouds and SaaS applications, lower the risk to data privacy and allow financial institutions to migrate more easily to the cloud.

Gilad Parann-Nissany, founder and CEO, is a Cloud Computing pioneer. As CTO for Small Business at SAP, Gilad built SaaS Clouds for medium and small enterprises and contributed to SAP products reaching more than 8 million users. Before founding Porticor, he created a consumer Cloud at G.ho.st – a cloud operating system that delighted hundreds of thousands of users while providing browser-based and mobile access to data, people and applications.

Previous
2 of 2
Next
Comment  | 
Print  | 
More Insights
More Commentary
Shared Reporting Services on the Horizon, Genpact Predicts
The financial services industry is starting to adopt shared services, resulting in reasonable impacts to the bottom line. Genpact expects a push for reporting efficiency will come next.
Don't Let the Cloud Rain on Your Operations Strategy Parade
Avoid migrating large applications all at once to minimize risk during a cloud project.
Could Intel Lose Data Center Market Share to ARM Chips?
ARM chips could be an alternative for certain purposes in the datacenter, but many questions have to be answered before they pose a threat to Intel's market dominance.
Cost to Trade: Hey, Banks, Itís Time to Face the Music
Why is calculating the cost to trade so difficult for banks? The answer is as complex as the calculations themselves.
M&A Activity Will Continue to Grow in 2015
Data shows that the M&A market continues to improve, and forecasts indicate deal making will be healthy in 2015.
Register for Wall Street & Technology Newsletters
White Papers
Current Issue
Wall Street & Technology - Elite 8, October 2014
The in-depth profiles of this year's Elite 8 honorees focus on leadership, talent recruitment, big data, analytics, mobile, and more.
Video
Inside Abel Noser's Trading Floor
Inside Abel Noser's Trading Floor
Advanced Trading takes you on an exclusive tour of Abel Noser's New York trading floor, where the agency broker known for transaction cost analysis, is customizing algorithms for the buy side, while growing its fixed income trading and transitions business.