Megaupload case shows danger of 'cloud'

Over the last few months, I've talked to a lot of remodelers that are opting to use the cloud to store their files and share them with subs and clients.

The idea is that it gives companies an easy way to back-up files and move them without spending a lot of money on servers, extra hard drives, etc. It's a great idea - I do it myself, using Amazon's cloud service, as well as Dropbox.

The problem, though, is that you're now relying on that company to stay in business and the shutdown yesterday of Megaupload by the federal government illustrates how dangerous that can be. (In short, the Feds allege that Megaupload was running a criminal conspiracy that allowed people to access pirated content.)

You can't control what other users do with a cloud site, but you can take steps to protect yourself.

A few factors to consider:

• Make sure you have a physical back-up of your most important digital files (say, your tax returns) - preferably stored in a different location in case of some sort of natural disaster.
• How big is the company? You're much more likely not to lose your files working with an Amazon, Google, Microsoft, etc. Remember that a lot of low-price start-ups have gone out of business, taking users' files with them.
• Ask how the files are secured. You don't want your files falling into the hands of hackers.
• Are your back-ups backed up? Will they store your information stored in multiple places? Their servers can fail just as easily as yours.