Clouds for customs
CBP, other countries' customs administrations cautiously embrace new way of data sharing.
Cloud computing, or the ability to access information from the Internet via servers no matter the user's location, can help customs administrations shrink their information technology budgets and speed up systems implementation. But concerns with security, privacy and sovereignty of data exchanges keep those development efforts in slow gear.
'We see it as the vision for the future,' said Charles R. Armstrong, chief information officer for U.S. Customs and Border Protection, at the World Customs Organization's IT Conference and Exhibition in Seattle on May 11. 'But we have a lot to hammer out to actually reach that point.'
Last year, the Obama administration instituted a 'cloud first' policy for future technology implementation across federal agencies. This move is expected to save the U.S. government billions of dollars in IT development.
At the Department of Homeland Security, CBP's parent, there's already an effort underway to rationalize 45 data centers and numerous small field IT desks across the department into two locations. This will be followed by the implementation of good governance and best practices. It's estimated that CBP alone manages the exchange of 30 billion messages daily with other federal agencies and the industry.
'If we can do these things we'll really transform the way we do business and the way we operate at the Department of Homeland Security,' said Richard A. Spires, the department's CIO.
'It's a cultural change for us, but I believe it's one that we can work through,' he added.
Because it manages sensitive export and import information for trade and national security purposes, CBP plans to develop a highly secure 'private cloud,' with the agency routing data through its own servers. This cloud would share information in real time among customs officers, partner agencies and potentially overseas governments.
According to IT industry experts, there are also opportunities in the customs space to develop more open public/private clouds to improve the efficiency of sharing data between customs administrations and the shipping industry.
With some basic controls, such as subscription or membership access, customs administrations could use public/private clouds to publish tariff information, facilitate communication with industry participants in authorized supply chains (secure trade lanes), and share beneficial risk management details, explained Norbert Kouwenhoven, executive partner for IBM Business Solutions.
British Customs, for example, recently published its tariff on the Web, and has noticed a 60 percent reduction in tariff-related calls from shippers to its help desk.
Over time, CBP expects to move less sensitive customs information to public clouds.
'We're dipping our toe in the public cloud,' Spires said. 'We can't be so insular that we're hurting ourselves, but we have to put the right practices in place.'
For many developing countries, traditional IT development for customs modernization is often cost prohibitive. But the emergence of cloud computing may bring some of them quickly up to industrialized nation standards.
'It delivers significant benefits and opportunities in emerging markets,' said Nick Small, a director with Crown Agents.
It's estimated cloud computing could save customs administrations as much as 90 percent in IT development costs and speed to market.
Microsoft, a developer of cloud systems, is working with the customs administrations of Namibia, Botswana and South Africa to implement the Trans Kalahari Corridor single window. Based on a memorandum of understanding signed in 2003, the countries agreed to institute seamless customs controls for cargo landing at Namibia's Walvis Bay, transiting through southern Botswana, and arriving at Johannesburg. 'We are encouraged by the advent for cloud computing and that it will provide the solution,' said a Namibian Customs official.
James Bryce Clark, general counsel of OASIS, one of the largest global consortia developing Internet standards for e-business, said many customs administrations are expected to adopt cloud methods like 'LEGO blocks, one piece at a time: First cloud data storage, or better Internet data security practices, or cloud backup, etc. For most of those elements, there are well established standards and best practices.
'However, if you're looking at a complete, integrated cloud solution, we're early in the development of that technology,' he said. 'It may be like buying a smart phone in 2003.'
Clark warned that as customs administrations add and replace systems they must ask themselves whether each renovation or new system is free of obstacles to future technology add-ons. They should also take into account global open standards, to help them avoid vendor lock-in.
Another concern for customs administrations considering cloud computing should be data jurisdiction and server location. 'If you outsource your data functions, and the activity is located offshore, what do you do if your relations with the host nation break down? Can you 'extradite' data? Where are the backups? How easy would it be to restore your critical functions, if the data spigot gets turned off?' Clark said. 'We have seen some instances lately of governments 'turning off' the Internet.'
WCO Secretary General Kunio Mikuriya acknowledged cloud computing is a new concept for customs. The Brussels-based organization, with its 177 customs administration members, will track cloud computing advances and assist with developing related data standards, similar to its work with the SAFE Framework of Standards for transborder cargo security after the Sept. 11, 2001, terrorist attacks.
'Standards are about harmonized, reusable data,' Clark said. 'The great lesson of EDI (electronic data interchange), which washed like a tidal wave through the trade in the 1990s, is need to get your business practices right. To fully benefit from standardized data and cloud technology, enterprises will need to analyze and better understand their operations.'