Study: Patchwork of laws undermines cloud computing market

While many developed countries have adjusted their laws and regulations to address cloud computing, the wide differences in those rules make it difficult for companies to invest in the technology, according to a new study by the Business Software Alliance.

Cloud computing provides resources, software and data over networks. Such systems may feature servers in one country and customers in another, making it difficult to regulate and protect them.

The 24 countries surveyed in the report account for about 80 percent of the world's information and communications technology, but some countries have done better than others.

Japan, Australia, the United States, and some European countries top the rankings, while some otherwise tech-savvy countries like India, China and Brazil are near the bottom, the group found.

In the United States, for example, there are many up-to-date laws covering issues like cybercrime. Inconsistencies in state laws and court rulings on privacy, data breaches, and copyright issues still need to be remedied, the report concluded.

More regulation is not needed to help the world take advantage of a global technology like cloud computing, said BSA President Robert Holleyman. Rather, the patchwork of laws needs to be "harmonized" so that companies can develop cloud computing.

"My biggest concern is that if we don't watch out, governments will chop the global cloud into pieces and wall in their separate markets," he said in a statement.

One surprising finding: some countries are closing themselves off with laws and regulations that conflict with other countries. The report said the European Union's proposed Data Protection Regulation could undermine the potential scale and economic impact of the cloud. "To have a global cloud market, we don't need every country's laws to be identical. But we do need them to be compatible," said Holleyman