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The State of the Cloud: A Global Look at Where the Cloud Stands Today

Les Williams
May 21, 2014

With the Snowden leak and the rise in knowledge of privacy issues that exists online, the trust placed in many U.S. cloud providers recently became a bit eroded, to say the least. As such, now, there’s an increasing need for American cloud providers to expand their cloud node deployments both here in the United States and internationally.

Here’s a look at just a few of the interesting things happening around the world that have the potential to impact growth models and adoption policies of the cloud, both at home and abroad:

  • The Cloud Goes to China: Both Azure and AWS have built separate regions to address the requirements of the Chinese. Given Chinese regulation, Microsoft had to partner with a Chinese vendor to build a cloud solution; in their case, it’s 21Vianet that will deliver Azure within the region. AWS is also opening up a new region in Beijing, offering “a limited preview of services” to select companies later this year.

    Doing business in China is a massive opportunity, however, it comes with some very significant limitations. Microsoft, for example, needed to deliver the cloud through a Chinese company, and on top of that, the Chinese government demands separate logins for Chinese services that are distinct from other regions and countries. This is a heavy burden for users, and somewhat lessens the “global cloud” story.
  • European Union Seeking to Regulate the Cloud: There’s been a lot of talk recently around the topic of the cloud and the privacy of citizens in the EU—particularly when it comes to EU citizens using cloud services from U.S. providers that could be subject to federal surveillance or other court-ordered information gathering. In the case of the EU, this means that American providers will have to build firewalled cloud services with clear guarantees for data security within Europe. This unique situation also has the ability to promote the opportunity for other regional cloud providers to emerge and grow quickly on the trust of localized data residency.

    Today, certain companies qualifying under the FTC and DoT can be certified under the Safe Harbor program, which allows companies seeking to do business in the EU to demonstrate compliance with EU privacy laws. Even in light of those rules, the EU wants to regulate the cloud, even if it makes the cloud’s use more complicated. As The New York Times notes, “One proposed amendment would require ‘all transfers of data’ from a cloud in the European Union to a cloud maintained in the United States or elsewhere to ‘be accompanied with a notification to the data subject of such transfer and its legal effects.’” With this proposed legislation, Safe Harbor as it stands may not be sufficient alone, a problem for companies—new and old—that currently rely on Safe Harbor as a channel through which they can do business in the EU.

    All of this is to say that bringing the cloud into European markets may be more difficult than initially thought, should this type of legislation come to fruition.
  • Tensions In Russia (Potentially) Impacting the Cloud: Since joining the WTO in 2012, Russia has made some good strides in updating its copyright and trade laws to align with international standards. That, however, could come grinding to a halt if the country’s fears surrounding privacy are increased and further compounded by sanctions.

    Late in 2012, Russia introduced new Internet filtering and censorship regulations that are likely to act as a significant barrier to cloud computing (Russia also mandates the use of certain specific products and software in government procurement opportunities). It should be interesting to see how Russia’s system and laws for local information privacy and international information interaction/interchange evolves along with its global political posture.

At home here in the United States, the foundation of the cloud is now matured enough to handle national and regional laws and political issues. For example, Amazon’s AWS is compliant with overarching American laws like HIPAA, PCI, and more. On top of that, AWS has technology partners that provide hardened specialized solutions to meet even the most stringent of regulatory compliance needs.

Large enterprises, too, now have lots of tools to implement a compliant cloud in a private environment. For example, here at Telx, we have partnered with cloud providers like Peak and GTT who are able to build enterprise cloud solutions with 100% uptime SLAs, and a architecture for business continuity guarantees and stringent regulatory compliance. This means that the cloud could now be easily consumed by financial and medical companies who typically have the most to deal with when it comes to compliance issues.

All-in-all? United States cloud technology is matured, and enterprises now understand the business case for the cloud, so there is still a favorable market ramp for cloud services here in the U.S. While other international use cases are more complicated and may take more time to become clear, as it stands, there’s still a lot of hope for the cloud to continue expanding outside the borders of the United States and into other countries around the globe.

Want to learn more about Telx’s cloud solutions, or about the current state of the cloud? Reach out to us via the contact page of our site, or by Facebook or Twitter, and let us know. We’d love to answer any questions you may have.

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