A Change is in the Air: Emerging Challenges for the Cloud Computing Industry

Abstract

A growing number of individuals, companies and regulators are concerned about who has access to data stored on the cloud and where exactly that cloud is. Actions taken in response to those concerns take the form of lawsuits, restrictive contracts, and government regulation of cloud computing. This trend toward restricting information storage to specific geographic boundaries is called “data localization” and leads to growing uncertainty about the future of digital commerce and communication that is the economic engine of the information age.

This paper offers an overview of recent regulatory trends in cloud computing around the world, assesses key regional differences and problems, and draws on expert interviews in charting the way forward for the industry. We show that while more restrictions and greater data localization are likely to characterize the internet of the future, new business opportunities will emerge for providers of cloud computing technology and services who succeed in developing products that satisfy differential regulation and consumer preferences.