Touble in the clouds

I am guessing if you are reading this you heard about the disaster that Microsoft had with the sidekick's data, many people lost pictures,calendar data and contacts.
Its nothing short of amazing that a company like Microsoft that consults fortune 500 companies about DRP will be without backup.

The biggest impact this incident has is on the momentum of companies trusting the cloud with their data. As it is using the cloud requires quite a bit of trust in the technology and the service provider, the provider gets to handle sensitive data and potentially business secrets.
The whole notion behind making the move usually lies in the following reasons:

1. The IT companies know more about security and redundancy than us.
2. They will probably be better at applying patches and fixes than us.
3. They will continuously update the software to the best one available while we can't afford
small cycles.
4. They have better uptime cause they can invest a lot more money in DRP and redundancy
while rolling the costs to the clients.
5. The data will be accessible from anywhere without needing to implement complicated and
costly security solutions not to mention the learning curves the users will need to use the tools.

This incident touches almost all the reasons of turning into the cloud and will make CIOs think twice before going ahead with their plans.

Microsoft needs to do nothing short of amazing damage control to fix this blunder, not just for them but for all the the companies wishing to sell cloud based computing in the next year.