Davide M. Parrilli, ICRI Information Technology Law: Advanced Course 17 March 2008 Grid computing: the legal perspective .

Davide M. Parrilli, ICRI

Information Technology Law: Advanced Course

17 March 2008

Grid computing: the Grid computing: the legal perspectivelegal perspective

http://www.law.kuleuven.be/icri

• What does Grid computing mean?• What is Grid computing from the

technical and business point of view?

• To what extent Grid computing will affect lawyer’s activity in Europe?

Selected issues.

Agenda

Question…

Did you ever heard Did you ever heard about Grid about Grid computing?computing?

Grid: a definition (I)

Grid in general terms: “a grid is something which is in a pattern of straight lines that cross over each other, forming squares”.

(source: Collins, English Dictionary for Advanced Learners)

Grid: a definition (II)

Graphically….

Grid: a definition (III)

The same idea lays behind the notion of Grid computingGrid computing: the key concept to keep in mind is that Grid, although

in different forms, covers the spectrum of distributed computingdistributed computing: in other words resources located in different places that work together.

Grid: a definition (IV)

Graphically…

Grid: a definition (V)

On a global scale….

Grid: a definition – infrastructure (I)

Three specific definitions of Grid computing from different perspectives:

1. Technical-oriented definition: multiple independent computing clustersclusters which are composed of

resource nodes not located within a single administrative domain;

Grid: a definition – infrastructure (II)

• Many nationalnational Grid infrastructures;

• Examples of internationalinternational networks:

1. BalticGrid: Baltic countries, Poland, Sweden, Switzerland;

2. Nordic Data Grid Facility: Denmark, Finland, Norway, Sweden;

3. NorduGrid: as above;4. LCG Grid: worldwide; 5. Network.com (Sun Microsystems):

worldwide

Grid: a definition – computing on demand (I)

2. Business-oriented definition: in distributed computing, the offer of

online computation or storage as a metered commercial service, or

the provision of SaaS: utility computing, computing on demand,

or cloud computing;

Grid: a definition – computing on demand (II)

Graphically…

End User

Supplier of capability or SaaS

He needs computation or storage power or the

provision of software but he does not have

the necessary resources

Grid: a definition – computing on demand (III)

Examples:• 3tera-AppLogic: provision of SaaS;• Elasticlive: web hosting capacity;• Oracle: storage and resource

capacity;• IBM: storage capacity;• [Others: see www.gridipedia.eu]

Grid: a definition – virtual supercomputer (I)

3. Academic-oriented definition: creation of a "virtual

supercomputer" by using spare computing resources within an

organization or a network of geographically dispersed

computers.

Grid: a definition – virtual supercomputer (II)

Graphically…

Grid: a definition – virtual supercomputer (III)

An example from the academic domain in the NL:

Grid: a definition – virtual supercomputer (IV)

Examples:• DAS-3 Grid: NL;• LCG: CERN and other institutions

worldwide;• Oxford University’s Centre for

Computational Drug: worldwide, dispersed network;

• iGrid: India;• University of Florida Grid.

Grid and business (I)

From the business point of view the definition From the business point of view the definition no. 2 is the most relevant: no. 2 is the most relevant:

•Provision of resources, capacity, etc. to end Provision of resources, capacity, etc. to end users through a Grid networkusers through a Grid network;;

•Provision of applications to end users Provision of applications to end users through a Grid networkthrough a Grid network..

Grid and business (II)

GRID has shifted from being seen just

as a way to save costs towards as a

means to make money…

In 2011 Grid market will reach 9.02 billions

Euros

Legal aspects of Grid (I)

Should an ICT lawyer be concerned wit Grid technology? Does Grid have any impact from

the legal point of view?

Legal aspects of Grid (II)

In other words…

Is Grid a neutral technology?Is Grid a neutral technology?

Legal aspects of Grid (III)

Grid does matter…we’ll take into account some specific

fields:1) Business contracts;

2) Patents;3)Taxation.

Business contracts (I)

Impact of Grid on ASPASP: contract regarding the provision of

computer-based services (software) to customers over a network

(Internet); the provider can be either the owner of the software or a

licensee (sub-license).

Business contracts (II)

Definition of the operating operating environmentenvironment: provision regarding

the technical modalities of the delivery of the software (SaaS).

E.g.: how much capacity will be used in the Grid network?

Business contracts (III)

Service standard and SLA (service level agreement): the fact to use a

Grid infrastructure has effects on the standards of the services provided.

E.g.: can we expect that the client will require more from the supplier?

Business contracts (IV)

LiabilityLiability: what if the Grid infrastructure is not

owned and managed by the software provider? In B2B (EU) the ASP should limitlimit as much as possible his liability

Allocation of the risk between Grid provider, ASP and end user.

Business contracts (V)

Graphically….

User ASP Grid provider

Patents (I)

Patents and Grid: a sensitive and hot point…

some questions…

Patents (II)

How do we have to consider, to the ends of patentability, an application

that runs on a Grid network?

On the other side, what is a Grid network and which is its role?

Patents (III)

Separation between the application (SaaS) and the Grid infrastructure:

•Grid: medium to deliver the software (hardware);

• Application: patentable in Europe if it has a technical character it solves a technical problem which lies behind the normal interaction software/hardware.

Patents (IV)

Is a software which enables the Grid to work or enhances its performance

patentable?

Patents (V)

Here there is a technical problem that is solved by the

software

Patentability cannot be Patentability cannot be excludedexcluded

Tax issues (I)

TaxationTaxation and GridGrid in electronic commerce…one first fundamental

question…

How can we consider the nature of every server or component involved

in the business?

Tax issues (II)

Principle (OECD Model Convention): a server is a P.E. of a company

The profitsprofits generated by and through the server are taxable where

the server is located.

Tax issues (III)

But…What if there are many servers that

work in close cooperation at the same time and that are located in different

jurisdictions?And…

How is it possible to allocate the profits generated by each component?

Tax issues (IV)

The issue is open…no solution yet, but the increasing

transnational development of Grid technology will force

policymakers (OECD and EU) to find solutions.

Conclusions

• Ad hocAd hoc clauses clauses in the ICT agreements; careful assessment of the contractual

liabilityliability of the parties involved;• A software that enables the Grid to work

or enhances its performances is in principle patentablepatentable;

• Need for ICT-oriented solutions in the field of taxationtaxation (many servers, many

jurisdictions).

Thank you for your attention!

Davide M. ParrilliInterdisciplinary Centre for Law & ICT - ICRI

K.U.LeuvenSint-Michielsstraat 6

3000 Leuven

[email protected]

http://www.law.kuleuven.be/icri