Wolters Kluwer Outage Shows Risks of Cloud Centralization

Chris Gaetano
Published Date:
May 13, 2019

Last week's cyberattack on Wolters Kluwer, which knocked out widely used accounting and tax software platforms around the world, demonstrated the risks that emerge when vast swaths of the economy come to rely on the services of a single company, according to Bloomberg. Wolters Kluwer, the Dutch company behind popular services such as CCH SureTax and CCH Axcess, claims 93 percent of Fortune 500 companies as its customers. A systems shutdown enacted by the company to prevent further damage from the hack left businesses around the world without the vital tools they've come to depend upon to do work such as nonprofit returns, which are due in just days. Even internal operations were snarled, with Bloomberg citing one company that kept its payroll data with Wolters Kluwer and so was unable to pay its own professionals. While many services have since been restored, the incident has rattled businesses that came to take these products for granted. 

It might strike some as ironic that the original purpose of the internet was to decentralize communications infrastructure in the event of a nuclear attack. However, as time has gone on, online systems have become more and more centralized into a few fixed points. For instance, in terms of cloud computing infrastructure, about 66 percent of the entire market is controlled by just five companies. The biggest player, Amazon Web Services, alone accounts for 32.3 percent of the customer spending in this area. 

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