How does it affect your data?

Most firms are now using cloud computing in one format or another, but one area cloud customers aren’t closely monitoring is the impact of legislation on company data stored in the cloud. According to a V3 reader survey, 80 per cent of firms are unaware of data protection law changes and their effect on data stored outside of the EU.

The US has also rolled out its own law, the Patriot Act, which gives the government the right to access sensitive data, meaning an extra complexity for UK firms choosing US cloud partners.

Many European businesses are prevented from adopting external cloud services because of the US Patriot Act, according to CA Technologies Cloud Solutions president Chris Rae.

Common obstacles to cloud computing adoption include security and availability of service, but he argued that regulatory problems are also a major barrier.

The Patriot Act came in response to the 9/11 attacks in the US, and can force US cloud providers to share data with US authorities, overriding European data protection regulations.

Concerns have been raised recently in the European Parliament about the negative impact of the Patriot Act on cloud adoption, and the Netherlands even considered preventing US cloud providers working on government contracts.

"Security is clearly not the only inhibitor to cloud adoption," said Rae. "The issues between the Data Protection Act and the Patriot Act need to be overcome."

However, Rae is confident that the US will modify the Patriot Act to prevent the country suffering financially.

"The Federal government is already in talks with the European Commission because people are turning their backs on US-based clouds and the US is losing money, so the legislation will be fixed for the sake of the global economy," he said.

However, Rae suggested that the 9/11 attacks may have to "fade a bit" before the Act is changed.

Even if Europe developed its own industry-leading cloud service providers, similar to those of Amazon, Google and Salesforce, it may not be enough to lure businesses to the cloud, because there is always the possibility that European cloud providers will be acquired, he added.

Any information referenced above was original published on the V3 website.

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