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Cisco Systems' Chairman and CEO John Chambers has admitted that the computing industry's move to sell pay-as-you-go computing cycles as a service on the Internet is "a security nightmare."

Speaking during a keynote address at the RSA security conference in San Francisco, Chambers said that cloud computing was inevitable, but that it would shake up the way that networks are secured. "You'll have no idea what's in the corporate data centre," he said. "That is exciting to me as a network player. Boy am I going to sell a lot of stuff to tie that together."

However, he added, "It is a security nightmare and it can't be handled in traditional ways."

Cloud computing is a hot topic at the annual security conference. Big computing companies like Cisco and IBM are eager to talk about it, but security experts see a lot of work ahead.

"I think it's really going to be a focal point of a lot of our work in the cyber security area," said Ronald Rivest a MIT computer science professor and noted cryptographer, speaking during a conference panel. "Cloud computing sounds so sweet and wonderful and safe... we should just be aware of the terminology, if we go around for a week calling it swamp computing I think you might have the right mindset."

Rivest added that he was optimistic about cloud computing's future, but that it was going to take "a lot of hard work" to make it secure.

Show attendees haven't exactly bought into the concept.

"I'm not seeing a huge benefit in the cloud for us," said Bruce Jones, chief information security officer of Kodak, speaking in an interview.

One of the main problems is that Jones doesn't want to give up control of sensitive data to a nebulous cloud-based computing architecture. For long-term computing projects, it's probably cheaper to simply buy the hardware, he said, but he does think that cloud computing could work on a small scale at Kodak. "It's a pilot or an R&D project where they want to do something and they need some kind of on-demand scalability, it's good for that as long as you don't care about the confidentiality of the data."

As data moves onto the cloud, Cisco's security services will become even more important, and the company's ability to dig in and inspect data moving on and off corporate networks will become even more critical, said Tom Gillis, vice president of marketing with Cisco's Security Technology Business Unit, in an interview. "The move to collaboration, whether it be video or the use of Web 2.0 technologies or mobile devices is really dissolving the corporate perimeter," he said. "This notion of security as a line that you draw in the sand... that notion is just gone."

And it's not going to come back. Chambers says that his company's use of Web 2.0 technologies like video blogging and conferencing has mushroomed in the past year. In the first quarter of 2009 Chambers held 262 meetings, he said. 200 of them were virtual, using Cisco's TelePresence system. "It's got to be secure as we do this," he said. "This is our lives."

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