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Governments Must Step Up to Increase Cloud Adoption in Low- and Middle-Income Countries: Report

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The United Nations Conference on Trade and Development released a new report on Tuesday that examines the economic potential of cloud computing for low- and middle-income countries, where rates of cloud adoption are currently low.

The Information Economy Report 2013: The Cloud Economy and Developing Nations gives a high-level overview of cloud computing adoption, providers, and terms, and makes several recommendations to increase cloud adoption in low- and middle-income countries.

Cloud computing impacts many different aspects of the global IT sector; the demand for bandwidth will drive telecommunications growth, and demand for servers and networking equipment will increase as more services move to the cloud, a trend that has been forecast in other recent reports.

The US and Europe have typically driven cloud traffic growth, accounting for 60 percent of cloud traffic on the Internet in 2012, while Latin America and the Middle East and Africa combined only accounted for 5 percent. This number is expected to rise exponentially in the coming years.

In low-income economies, IaaS services, especially free cloud services, are the first to emerge. With infrastructure growth and SME sector expansion, the report said that SaaS will become the dominant cloud market in developing economies.

The report acknowledges that thus far, global cloud providers like Amazon, Google and Microsoft have been the most successful, but local or regional providers could benefit from growing demand for private cloud solutions, national data-protection laws or corporate policies that require data to be kept within borders. Also, international broadband connectivity can be unreliable and expensive, an issue that CDNs have more recently sought to address.

“Although the cloud provisioning market is dominated by a relatively small number of very large providers, there are opportunities for developing-country firms to participate on the supply side of the cloud economy,” according to the report. “These include data-center provision and management, both independently and in conjunction with global cloud providers; cloud aggregation and integration services; and the development and provision of cloud services to different groups, including local businesses and individuals. It is important that, when they are designing national ICT strategies, or dedicated cloud strategies, governments take the supply side as well as the demand side of the cloud fully into account.”

Aside from the high cost of communications and broadband usage, there is a lack of policies that protect cloud users in low- and middle-income countries.

“Public law is essential to secure the basic rights of end users. While there is no imperative to develop specific laws or regulations on cloud computing, areas requiring reform are relatively clear: privacy, data protection, information security and cybercrime,” the report said. “For governments of developing countries, it is essential that appropriate laws and regulations are enforced in these areas. As of 2013 there were 99 countries with data privacy laws. As far as is known, Mexico is the only country which has adopted cloud-specific provisions in relation to data protection.”

In order to drive cloud adoption in low- and middle-income countries, governments must assess the cloud readiness of the country in order to identify potential weaknesses to inform the development of a national cloud strategy.

Governments should also be able to address relevant legal and regulatory issues related to cloud adoption, and map opportunities on the supply side of the cloud economy, including national data centers, and cloud aggregation services.

Finally, the skills gap, and the government’s own use of cloud services, must be addressed.

While the report goes into much more detail around the areas of opportunity for cloud adoption, it is clear that it suggests governments will play a major role in informing how cloud services are managed on a national-level and end-users’ rights are protected. Depending on the country, this could be a good or bad thing.

About the Author

Nicole Henderson is the Editor in Chief of the WHIR, where she covers daily news and features online. She has a bachelor of journalism from Ryerson University in Toronto. You can find her on Twitter @NicoleHenderson.

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