Although many companies may go into the cloud with a "standard contract," this may be a bad idea, according to new research by the Cloud Legal Project at the Centre for Commercial Law Studies at Queen Mary, University of London.

Professor Christopher Millard, lead academic on the Cloud Legal Project, said there are key contractual issues that users need to negotiate in what is now a relatively immature phase of cloud computing. The report finds the most negotiated cloud computing contract terms currently include intellectual property rights, data security, provider lability and termination rights.

“To remain competitive, providers may have to be more aware of user concerns, more flexible in negotiations, and more willing to demonstrate the security and robustness of their services," Millard said. “In the middle or low value markets, choice is still limited, and many contract terms are still inadequate or inappropriate for SME users’ needs, as they may lack the bargaining power to force contract changes.”

Using a one-size-fits-all method for cloud computing misses some of the main benefits of the technology. said one of the main things the cloud does for a business is improve flexability. This should start from the beginning as companies negotiate terms of their own cloud.