Latin America rises to the top in the cloud computing industry

The Rising Star in Cloud Computing

By IGI Global Author Relations Team on Aug 1, 2017
cloud computing
In the world of cloud computing, well-known companies such as Microsoft, Amazon Web Service (ASW), and Salesforce sit at the top when it comes to digitized data. These American companies are defining the biggest cloud computing technologies and assisting businesses in transforming digitally. But another player has come on to the scene and it is not a cloud computing company, but a region.

According to a study released by BSA-The Software Alliance, the top three-countries that are embracing the cloud computing industry are Japan, Australia and the United States. But Latin America is bolstering its way into the heavy hitters and is expected to dethrone some of the larger forces. IT industry revenues in Latin America predict that the cloud computing industry will grow by 25 percent and individual countries within the continent are predicted to exceed that percent. Prof. Nayyer Rahman, contributor to the Encyclopedia of Information Science and Technology, Fourth Edition weighed in on why cloud computing is important and the impact South America is having on this industry.

Why is cloud computing important and how does it impact business?

The importance of cloud computing can be gauged by the fact that in a knowledge driven economy, the sources of knowledge management are through intelligent machines. The demarcation between online and offline is decreasing due to the increasing rate of internet penetration worldwide. Cloud computing functions as a micro and macro database of both active and passive knowledge. This also makes sharing and storing of data easy yet protected.

It is argued that cloud computing is the product of the IT revolution and globalization. But I would argue that cloud computing and the emergence of globalization is bi-directional and cause each other. No business remains to be isolated from the forces of globalization, be it MNC or SME. Cloud computing services push business to involve in cross-border activities without physical cross-border transit. This opens up new avenues for business in a globalized world. There is an overwhelming evidence that Cloud Computing services assist business in achieving economies of scale.

IT industry revenues in Latin America are predicted to grow by 25%. What are the key factors that are shaping the cloud computing industry in Latin America?

Yes, absolutely it is expected that IT revenues in Latin America will grow by 25% and few countries like Argentina and Brazil may even witness more than a 25%+ rate of growth. Three factors are of prime consideration in shaping the cloud computing industry in Latin America. The emergence of Multi-Latinas (Latin American MNCs), the involvement of SMEs in the process of internationalization and knowledge spillovers due to FDI in the region.

One of the largest Latin American Data Centres is slated to be completed in São Paulo, Brazil. How does this impact the industry? Equinix has already opened one of the biggest data centers in Sao Paulo along with five subsidiary data centers. The IT industry as well as potential customers have taken the development positively and are enthusiastic about the future. This will generate strong demand for cloud computing, especially for the hybrid cloud. The industry will witness a rapid increase in revenues and profit margin will also go up.

What are the main security risks of cloud computing?

The Cloud Security Alliance Report (2016) has highlighted around 12 fatal threats to cloud computing. However, in my view, principally there are four; data breaches, hacked interface, permanent data loss, and DoS attacks. The emergence of these security risks has been well tackled by anti-virus providers and a hybrid of cloud computing and anti-virus protection.

How is Latin America responding to user concerns regarding transparency and security?

By 2018, there will around 355 million internet users and 109 million cloud storage users in Latin America. This raises the concern of transparency and security. Different areas of Latin America are responding differently depending on resources and cloud users. This is due to heterogeneity of the Latin American region. On a common ground, cloud providers have started developing and providing cloud security as well. Though there is no assessment of the average cost of such protection it is argued that people are opting for protection. At the level of public policy malicious threats are controlled and monitored regularly and governments are taking note of it.

What can users do to ensure that their data is protected?

For the matter of pragmatic precautionary step, I would divide the users into general users (beginners) and professional users (experts). General users do not have much knowledge about threats and only realize the problem when it is on the table. For them, the simplest and the most effective way is to get cloud security from cloud service providers. On the other hand, professional users should not limit themselves to basic protection, but rather look for a comprehensive approach.

According to an article by Network World, multi-cloud is the future of the industry. In your opinion, what is the next big trend in the cloud computing?

The notion that multi-cloud is different from cloud computing or the former is the next level of latter is confusing and strict demarcation is not possible. The difference remains vague and ambiguous. Users are using several cloud platforms and will continue to use it. It all depends on the cost one is ready to afford. I think the next big thing to name it will be “citizen cloud” where citizens can use a nationalized cloud service and it may be linked to social security schemes as well. That we hope to see in the coming decade. Whether political will supports it or not is a question for all the policy makers to ponder upon.


A sincere thanks to Dr. Mohd Nayyer Rahman for taking time out of his busy schedules to collaborate with IGI Global and for sharing his thoughts on Digital Transformation. To read more about Dr. Rahman's research on cloud computing in Latin America, be sure to check out his article in the recently released Encyclopedia of Information Science and Technology, Fourth Edition.
Disclaimer: The opinions expressed in this article are the author’s own and do not reflect the views of IGI Global.
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