Trump Effect Could Cost U.S. Cloud Providers Over $10 Billion: Report

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Cloud computing companies in the U.S. could lose more than $10 billion by 2020 as a result of the Trump administration’s reputation regarding data privacy, according to Swiss hosting company Artmotion.

A whitepaper published by Artmotion suggests that growth rate in U.S. cloud revenue relative to the rest of the world will decline significantly more than previously forecast by IDC.

See also: Tech Goes From White House to Doghouse in Trump’s Washington

IDC’s Worldwide Public Cloud Services Spending Guide predicts that the U.S. will account for 60 percent of cloud revenue worldwide to 2020. The same research, however, suggests revenue growth in the U.S. will be lower than that in all seven other regions analyzed by IDC, and according to Artmotion does not take into account the sharply falling confidence businesses have in the capacity of U.S. companies to protect the privacy of data in the cloud.

“While these figures may be concerning for U.S. service providers already, they don’t take full account of the scale of the disapproval of President Trump’s actions since taking office,” according to Mateo Meier, CEO of Artmotion.

Artmotion’s own research shows that half of U.S. and U.K. citizens feel online data privacy is less secure under President Trump. Further, 24 percent are most concerned about their own government, while only 20 percent consider the Russian government most concerning, and 15 percent fear the Chinese government. Both Russia and China were considered a greater threat to data privacy by Americans in Artmotion’s 2015 survey.

Artmotion, which has seen a 14 percent increase in revenue from U.S. companies from 2016 to 2017, estimates the total loss in revenue to U.S. cloud companies will be $1 billion this year, over $3 billion in 2018 and 2019, respectively, and $2.7 billion in 2020.

The whitepaper was released before the U.S. Department of Justice took the unprecedented step of demanding visitor logs containing the IP addresses of website visitors to anti-Trump website disruptj20.org.

The study cites survey results released by Pew Research Center, which show confidence in the U.S. president’s handling of international affairs falling from 64 percent at the end of Obama’s term to only 22 percent at the beginning of Trump’s.

“(A)ny government, legislative and regulatory uncertainty is likely to make organizations think twice about where they host their data,” Meier writes in the whitepaper.

Artmotion reported a 45 percent increase in revenue immediately following the PRISM program revelations of 2013, though the loss of business confidence in U.S. data privacy protections did not reach the $35 billion impact through 2016 estimated by the Information Technology and Innovation Foundation at the time.

Part of the reason for this may be slower than expected cloud adoption by European businesses.

IDC research indicates that Western European cloud adoption is about to catch up to that of U.S. businesses, just as the EU seeks clarification from the U.S. about the impact of an early President Trump executive order on the EU-US Privacy Shield.

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2 Comments

  1. Jordan

    Wow... what a huge load of worthless FUD. Not worth the time I spent reading it. :(

    Reply
  2. What a crock of s**t. Trump is reducing regulations and the cost of doing business in the USA.

    Reply