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Canada’s cloud computing market

Analysts predict strong cloud market growth in Canada, which may push for changes in government data ownership legislation.

Cloud vendors have had to address different challenges as they expand their business across international borders. Disparate privacy laws, regulatory requirements and cultural expectations can make for a difficult market, but even companies in hesitant corporate climates are beginning to make headway into the cloud. In her analysis of the cloud computing market across the world, CloudTimes columnist Xath Cruz recently explored the cloud’s positioning in Canada.

The running theme for Canadian companies migrating to cloud storage services is one of caution. Cruz noted that adoption has been relatively slow due to data ownership concerns. These fears largely stem from government legislation that places data management and security responsibility entirely on the organization that collects information. As a result, many Canadian companies turn to U.S.-based cloud providers to ensure they will maintain control over their assets. However, only those that operate entirely in the private sector are able to go this route.

Although Canada’s business world has been hesitant about the cloud, a surge of adoption momentum may help the country catch up, Cruz reported. Research firm IDC expects the cloud’s portion of Canada’s software market to increase from 5 percent to 15 percent within the next three years. This burgeoning interest may usher changes to government policies that currently act as inhibitors.

“This initial push will allow the country’s small population and its relatively large number of SMEs to join the cloud and drive adoption further,” Cruz wrote. “Once all of these pieces fall into place, moving to true Canadian cloud will be straightforward and will end up forcing the hand of their government.”

The worldwide cloud application market is an area of high growth, according to IDC. The firm predicted a compound annual growth rate of 24 percent through 2016 and expects the market to reach $67.3 billion in that time. In addition, researchers suggested that software-as-a-service applications are likely to grow at a rate five times that of the overall software industry.