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Conducting your business applications online is becoming increasingly easy. You can access files and folders on virtually any Internet-connected PC or smartphone without having to physically carry any sensitive data along with you on the road.

Often referred to as "cloud computing," this trend is on the rise thanks to ubiquitous Wi-Fi and 3G connectivity, perhaps accessed by devices with limited local memory such as the popular "netbooks" computer category. Plus there are hundreds of online-only apps, many of which are completely free and OS-agnostic, such as Google's Docs & Spreadsheets.

Know The Risks
After all, you've been reading email in the "cloud" for many years now, with web-based services like Windows Live Hotmail and Gmail, so why not work on your business apps remotely, too? You can, but cloud computing carries a few risks, warns Ted Schadler, vice president and principal analyst at Forrester Research, a Cambridge, Mass.-based independent research company covering business and technology. "Cloud computing is a new concept for most companies, and as with anything new, it raises questions."

Some argue working in the cloud can be safer than carrying around sensitive corporate data that could be lost or stolen, but you should evaluate the potential risks involved.

Host company practices "Some professionals worry about the service levels, the risks of sensitive data or contacts leaking out," says Schadler. In other words, how do you know the company you're paying to host your important work files online is properly protecting them?

When the company closes shop Another concern, says Schadler, is whether you can get your data back if the cloud provider goes belly up. And hey, in this economy, an online back-up and storage company could bite the bullet unexpectedly.

Consistent access What if you can't get online because of ISP maintenance or you're on an airplane that doesn't offer Wi-Fi? As you can see, cloud computing has its shortcomings, too.

Sticking with a known company makes a difference. "Companies like AT&T Hosting & Application Services, that's delivering hosted Microsoft Exchange, Salesforce with its CRM suite, or Microsoft itself, don't have reputations for security breaches or other business failures," says Schadler. "Instead, they invest more than your average Fortune 1,000 company in security technology and best practices -- you see this reflected in their security certifications."

Google Apps, for example, has the SAS 70 Type II certification to show its data centers and processes pass muster with a third-party auditor.

New Security Practices Needed
Cloud-style computing encompasses new security technologies and techniques, which will be available from new types of service providers, says John Pescatore, an analyst with Gartner, an IT research firm based in Stamford, Conn.

A report co-written by Pescatore says companies will work to extend security controls to mobile users who consume cloud-based IT services. Cloud-based security services will enable companies to implement more on-demand security controls and features, and security technology vendors will use cloud-style computing as a way to offer their products as a service.

Securing Data In The Cloud
Pescatore recommends these steps to secure your cloud computing experience:

Check out security If you work for a company, your company should extend security controls between mobile users and cloud-based services. If you're a sole entrepreneur, it's up to you to make sure the cloud company you're using takes proper security precautions.

Use strong passwords As cloud-based computing becomes more commonplace, companies should prioritize the implementation of technology that provides for the transition to longer encryption keys -- which are harder to compromise by malicious types.

Limit the use of public PCs When using a public computer at a hotel's business lounge or airport lounge, be sure to delete Internet history, cookies and clear cache before you're done, and be cautious of "keylogging" programs that attempt to record your keyboard strokes.

Watch out for rogues Also be cautious which Wi-Fi network you're joining as it could be a "rogue" connection set up by a malicious type determined to steal your data. While that free wireless connection your computer sniffed out in your hotel is tempting, pay the small fee for your hotel's secure network.

Most experts agree cloud computing is on the rise, and the benefits far outweigh its limitations, but be sure to employ smart security measures to protect the data you're accessing remotely.

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