UK cloud providers have the advantage over the US, for now

Washington's data snooping powers can deter potential cloud users

UK cloud providers currently have an edge over their counterparts in the US, according to several speakers at Computing's IT Leader Forum earlier this week.

Alistair Maughan, partner at law firm Morrison & Foerster, explained that it was the requirement of having to adhere to the US Patriot Act that was putting US providers on the back foot.

In the aftermath of the September 11 attacks, US authorities introduced the Patriot Act as part of anti-terrorism legislation. It allows the US government to retrieve data stored on US soil without the need to inform the owner of the data.

"I worked on a case where the UK government was unknowingly sharing data with US authorities, which was allowed because of the Patriot Act," added Maughan.

"This is very good news for UK-based cloud service providers, as this will work to their advantage when clients are choosing between vendors.

"US service providers will work around this, but the best they are likely to achieve is the requirement for notification when the data is going to be used."

This advantage may not last, though. Maughan said that stringent European legislation is likely to create similar issues going forward.

"The problems surrounding data and privacy are only going to get worse in Europe," he said.

"Brussels is constantly churning out and updating increasingly strict laws on data privacy. The Americans on the other hand have taken a far more liberal approach, which is likely to act as a counter balance [to the Patriot Act]."

It was also pointed out that if a service provider was to expose data, the liability would lie with the client company.

"When negotiating a contract with a vendor, CIOs need to ensure that there is a liability cap, meaning they are not solely responsible in the event of a data leak," said Maughan.

"Service providers are not easily prepared to pick up this responsibility, but it would provide some protection."