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Data regulations weigh heavily on business decisions

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Compliance and data sovereignty are now considered to be strong factors in the way businesses and organisations make decisions about their digital and technology strategies, according to a survey conducted by industry analysts IDC.

Data sovereignty refers to the jurisdictional control or legal authority that can be asserted over data due to its physical location, which may reside within certain jurisdictional boundaries.

“IDC expects data sovereignty and industry compliance considerations to be of increasing importance to decisions about the design, operation, and management of IT architectures, including the selection of cloud service providers,” Senior Research Director at IDC Chris Drake said.

“This partly reflects the growing importance of regulation, including GDPR, which emphasises the importance of personal data protection and provides specific rules about data storage and transfer,” he added.

According to the survey, which was released this week, half of the 1350 respondents (48 per cent) to IDC’s Cloud Pulse 2Q22 survey said that data sovereignty and industry compliance have factored highly in discussions about their future IT architectures.

In addition, a mere 4 per cent of participants expressed the belief that their IT organisations and businesses will not be impacted by data sovereignty and compliance considerations.

What is more, the company explained that among organisations that have an expectation of higher IT budgets throughout 2023, the majority believe that data sovereignty and industry compliance considerations will have a strong influence on service provider selection decisions, as well as any decisions pertaining to their core data centre environments.

Meanwhile, the company explained that data sovereignty is predominantly straightforward at the moment in time, since rules and regulations are already in place within the European Union and in other jurisdictions, including rules about data use, storage, and movement.

“The evolution of EU data regulation that started with GDPR in 2018 is being extended to the Data Governance Act,” the company’s report noted.

“As a result, enterprises that operate in Europe need technology solutions that provide a holistic view of how data is collected, classified, processed, and stored to ensure data regulations are being met,” it concluded.

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