International concern about digital spying by the National Security Agency could make it difficult for U.S. companies to gain customers in the growing cloud-computing business, and could cost them up to $35 billion through 2016.
European cloud computing businesses could gain customers by portraying themselves as less vulnerable to data requests and spying than U.S. companies, according to a report from the Information Technology and Innovation Foundation, which called for greater transparency about government monitoring to combat this perception.
If the U.S. loses about 10 percent of foreign business to European or Asian competitors and keeps its projected domestic market share, American cloud-computing providers might lose $21.5 billion over the next three years, explained Daniel Castro, the senior analyst at ITIF who wrote the report.
"On the high end, U.S. cloud computing providers might lose $35.0 billion by 2016," Castro said in the report. "This assumes the U.S. eventually loses 20 percent of the foreign market to competitors and retains its current domestic market share."