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SMBs see cloud as critical, demand privacy

Small and medium-sized businesses have a difficult task competing with larger firms that have more financial resources, giving enterprises the ability to invest in more advanced technologies. But thanks to the emergence of cloud computing, SMBs have a better chance of keeping pace with large organizations, as the cloud offers decision-makers the ability to leverage next-generation applications at an affordable price.

A new report by Microsoft revealed that approximately 65 percent of American SMBs said cloud computing was either "important" or "essential" to their livelihood, giving them the ability to remain competitive in an increasingly cutthroat business world. Another 81 percent of U.S. small companies said the cloud will be crucial for their success in two years.

Privacy concerns still cloud the market

While cloud computing adoption is on the rise, awareness and understanding of the technology grows, increasing concern in regard to how the cloud can keep sensitive solutions private. The study noted that roughly 59 percent of U.S. SMBs say their cloud provider's privacy policies have a significant impact on whether the company will leverage the hosted services or not.

"Not long ago, the IT industry wondered if privacy concerns would prevent small and [medium-sized] companies from moving to the cloud. Our research indicates that is not the case," Microsoft Trustworthy Computing chief privacy officer Brendon Lynch said. "Instead, SMBs are expressing their interest in data protection by using it as a way to evaluate potential cloud providers."

The study revealed that SMB decision-makers prioritize transparency in regard to where sensitive data is stored and having a level of segregation from other organizations using the same public cloud. Other decision-makers want vendors to promise not to mine confidential data for advertising purposes.

Solutions to the privacy dilemma

SMB decision-makers should construct a robust service-level agreement to ensure their vendors don't breach any privacy contracts. While this is an important step in developing a trusting relationship with the provider, companies should be specific but not make unrealistic demands, InformationWeek noted.

"In an SLA, specificity is very important," Pace Harmon consulting principal Jonathan Shaw said, according to InformationWeek. "You don't want to leave it open to broad terms."

Small firms may also consider leveraging the private cloud, as these environments are hosted on-site, letting IT departments manage and protect the structures in their own way.

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