Since the initial COVID lockdowns, we have seen an exponential increase in cloud usage. At its core, this is an easy way to connect a remote workforce, but there’s more to it than that.
If you skim the surface you’ll see what appear to be similarities: in 2020, about 90% of companies used some type of cloud service, with 9% using none. In 2026, about 95% of businesses use cloud services, with between 4-6% using none. But that doesn’t tell the whole story. It’s about the money.
In 2020, total worldwide revenue among cloud providers was around $90 billion. In 2026, it’s estimated at $478 billion. So, it’s not about just having something in the cloud – it was mainly used for secure data backup before 2020, but more and more, enterprises are moving the entirety of their operations to the cloud.
That’s a lot of eggs in one basket, so robust cybersecurity is needed to protect both your data AND your pocketbook because of significant compliance concerns.
Compliance involves a complex combination of legal and technical requirements. Organizations that fail to meet these standards can face significant fines and increased regulatory scrutiny. With data privacy mandates such as HIPAA and PCI DSS in effect, businesses must carefully navigate an increasingly intricate compliance landscape.
Why is cloud compliance important?
In a nutshell, compliance can keep you from declaring bankruptcy through loss of data, resources (money), reputation, and competitiveness. Compliance is the process of adhering to laws and standards governing data protection, security, and privacy. With laws currently in place, this is not optional. Unlike traditional on-site systems, cloud environments present security issues due to geographic data distribution, making compliance more complex.
What does compliance in the cloud involve?
Ensuring that data is secure at rest and in transit
Ensuring data residency
Maintaining access controls and audit trails
Demonstrating adherence to regular assessments
One key way to achieve the necessary level of cybersecurity is by using the Shared Responsibility Model.
Why is the shared responsibility model important?
The Shared Responsibility Model is one of the core concepts of cloud compliance, outlining the compliance division between the cloud provider and the customer. Let’s clearly define these two:
Cloud Service Providers (CSPs): They are responsible for cloud services and securing the infrastructure and network.
Customers: They are responsible for securing access management, user configurations, and data.
It’s foolish to believe that hiring a cloud service provider transfers compliance responsibility; this is not the case – you still have a lot of responsibility.
What is meant by compliance regulations?
Compliance regulations vary from state to state and country to country. It is important to know where data resides and through which countries it passes to remain compliant.
GDPR General (Data Protection Regulation) – EU
GDPR is a European law, but it holds sway over businesses that collect and process EU citizens’ personal data regardless of where the company is physically doing business.
The GDPR’s cloud-specific considerations:
To ensure that data is stored in EU-compliant regions
Enables data subject rights
Directs that strong encryption is implemented
Mandates that breach notification protocols are maintained
HIPAA (Health Insurance Portability and Accountability Act) – US
This is the United States regulatory agency that protects sensitive patient data. Cloud-based systems storing or transmitting this sensitive information (ePHI) have to abide by HIPAA standards.
HIPAA’s cloud-specific considerations:
Cloud providers must be HIPAA-compliant
Business Associate Agreements (BAAs) must be signed
Strong encryption of ePHI in storage and transmission
Strict access logs and audit trails must be implemented
PCI DSS (Payment Card Industry Data Security Standard)
Any organization that processes, stores, or transmits credit card information, must meet this set of compliance regulations. Cloud hosts must uphold the 12 core PCI DSS requirements.
PCI DSS’s cloud-specific considerations:
Payment data must be tokenized and encrypted
Network segmentation in cloud environments
Ongoing vulnerability scans and penetration testing must be performed
FedRAMP (Federal Risk and Authorization Management Program)-US
FedRAMP provides a standardized set of protocols for federal agencies operating on cloud-based systems; providers are required to complete a rigorous assessment process.
FedRAMP’s cloud-specific considerations:
Compliance is mandatory for U.S. government agencies and they vendors they use.
Strictly enforced regulations for data handling, encryption, and physical security protocols
ISO/IEC 27001
ISO/IEC 27001 is an international standard for Information Security Management Systems (ISMS). It is widely recognized as the benchmark for cloud compliance.
ISO/IEC 27001’s cloud-specific considerations:
Regularly performed risk assessments
Available documentation on policies and procedures
Demonstrate comprehensive access control and incident response protocols
How do you maintain compliance?
Once established, compliance maintenance is vital. Cloud compliance is not merely checking items off a list. It requires thoughtful consideration and a great deal of planning. Operating from a proactive stance, the following are considered best practices to follow:
Regular Audits
An excellent way to determine and maintain compliance is to perform ongoing compliance audits. Shortcomings are easily recognized and addressed to keep your infrastructure in compliance.
Adopt Robust Access Controls
Use the Principle of Least Privilege (PoLP), which provide users with only enough access to reach the resources they need. Integrating multi-factor authentication (MFA) provides another layer of security and insulates your organizational data.
Encrypt Data
Whether at rest or in transit, all data must use TLS and AES-256 protocols. These are industry standards and necessary for your organization to remain compliant.
Continuous and Comprehensive Monitoring
Use audit logs and real-time monitoring to provide alerts that aid in compliance adherence and response.
Ensure Data Residency
It doesn’t matter where your data is physically stored, there are jurisdictional requirements that need to be addressed. Ensure that your data center complies with any associated laws for the region.
Employee Training
Over 90%% of breaches are caused by human error, so regardless of how comprehensive your organization’s cybersecurity is, all it takes is a single click by a single user to create a ripple effect across your digital landscape. Providing proper training can help users adopt user policies that can help protect your digital assets and remain compliant.
Establish and Maintain Your State of Compliance
As your business expands and adopts more cloud-based systems, the need to maintain compliance responsibly becomes increasingly important. If you’re ready to strengthen your cloud compliance, contact us for expert guidance and resources. Gain actionable insights from seasoned IT professionals who help businesses navigate compliance challenges, reduce risk, and succeed in the ever-evolving digital landscape.
Frequently Asked Questions
What are the different types of compliance?
There are three main types of compliance to be concerned with:
Regulatory compliance
Industry compliance
Data compliance
Regulatory compliance is the most well-known, and involves complying with laws and regulations issued by government entities, including FTC, OSHA, and the EPA.
Who are the top 3 cloud service providers?
Year after year, the top three are Microsoft Azure, Amazon Web Services (AWS), and Google Cloud Platform (GCP), often called the ‘big three’ or hyperscalers, collectively holding the majority of the global cloud market share.
What are the four main cloud services?
In terms of cloud computing deployment models, there are four main services:
Infrastructure as a service (IaaS): Delivers on-demand infrastructure resources
Platform as a service (PaaS): Delivers and manages hardware and software resources for developing, testing, delivering, and managing cloud applications
Software as a service (SaaS): Provides a full application stack as a service that customers can access and use
Serverless computing: Provides solutions to build applications as simple, event-triggered functions without managing or scaling any infrastructure
What is the average cost of non-compliance?
Ranging from very small businesses to massive multinational corporations, the average cost of compliance came in at $5.47 million, according to Colligo, while the average cost of non-compliance was $14.82 million.
How secure is your network?
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