By Reanna Gutierrez with OneNeck IT

There has been a lot of buzz about the future of cloud computing in the post privacy age. In a post-PRISM world, will foreign cloud companies have a home field advantage against ours? As a natural consequence of the unapologetic stance of the U.S government after being confronted about its worldwide data piracy program, European media and businesses began taking a hard look at their data security. The issue has a tendency to be viewed more optimistically than it deserves. European companies are going to gain a lot, and there are very good reasons why.

Dan Gilmore of Arizona State University, said “…it depends on whether you think European governments won’t do exactly the same thing with providers in their own jurisdictions.” I respectfully disagree. I do not believe it depends on that.

National Security

There is a huge difference between allowing your own government to look at your data for your own national security, and allowing a completely unaffiliated foreign government access to your data for someone else’s national security. The latter is not likely to be beneficial to you, and may very well be harmful to your own economic interests.

German companies, for example, understand that a German IaaS provider is not going to be convinced to give up your personal data because President Obama calls them up on the phone and tells them it’s in America’s national interest. If it is the local government that calls for domestic security reasons, then at least the providers can justify giving up the data as being in their own, and in the customers’ best interest. American IT hosting is best for American companies, who are the priority of American security efforts.

Democracy is Local

Another important aspect of the situation that should not be dismissed is that local companies, the kind who are small enough to need IaaS providers, want their data in places where they still have some say over what is done with it. While the data is stored within their own country, both private voters and smaller companies can realistically influence the laws and regulations regarding the handling of their data. If it is within the EU, this is diminished, but there is still some accountability.

American democracy doesn’t care what Europeans think, and Europeans know this. Once their data is being stored on U.S soil, they no longer have control of it. International agreements are notoriously unreliable in that they are bound entirely to convenience, and are not enforceable when it is a government, rather than a company, that choses to violate them. Furthermore, companies have no real influence regarding these international regulations or foreign laws that protect their data, or the evolution of those laws in the future. If the NSA gives itself an exemption regarding data belonging to foreign companies, as they already have with the private data of foreign nationals, then there is exactly nothing they can do about it.

While many any European governments have been caught cooperating with the NSA, this is no reason to assume that local companies will suddenly lose all faith in their own governments. Those governments still work in their own interest, filtering the information that is shared to avoid giving away important technology and research, because that would be harmful to their own economy.

National and Economic Interests often Align

Domestic cloud providers have stronger incentive to protect trade secrets because they are dependent on the local economy. There is a very good reason that American high tech manufacturers aren’t trying to hire Iranian IaaS providers. While that is a very extreme example, it applies across the board. Any company understands that it isn’t a good idea to entrust their sensitive data to a group that might benefit more by selling their data than by keeping it secure.

Companies will feel more secure with a cloud provider whose loyalty is guaranteed by a dependence on the success of local firms, and who cannot be dominated by foreign economic or political interests. A French firm will think twice before uploading their data to a Chinese cloud provider. A large multinational firm might seem a safe an unbiased choice, but knowing Europeans, they will be cautious with their data security, and they will go domestic before they go foreign.