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Jurisdictional Issues Raised by Virtualization and Data Location

Virtualisation forms the backbone of cloud computing. Virtual Desktop Infrastructure (VDI) allows an employee’s desktop to be moved into the virtual environment in a central server thus enabling hardware cost reduction and better control over the use of software applications. However, doing so with a software license that has geographical limitations on the type of hardware deployed or does not allow the use of the software in a virtualised setup may result in copyright infringement. In such cases, the license must be re-negotiated at an additional cost for unlimited number of instances or for a specific number of instances in the virtual machine. Additionally the confidentiality provisions of the software license regarding the disclosure of proprietary software must be reviewed to avoid the breach situation.

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