The cloud is a powerful tool for storing and managing large amounts of data while keeping hardware costs low. But as you take advantage of its benefits, it’s essential to address the challenges of data sovereignty and compliance. Overlooking these issues can lead to significant risks for your business, including financial loss, legal penalties, and reputational harm.
This article will explore how private cloud hosting can give your organization full control over its infrastructure, helping you meet complex data sovereignty and compliance requirements with confidence.
What is data sovereignty, and why does it matter?
To see why private cloud hosting is valuable, let’s first understand what data sovereignty is and why it matters.
Data sovereignty refers to the idea that data is subject to the laws and regulations of the country in which it resides. For example, frameworks such as the European Union’s General Data Protection Regulation (GDPR) and the United States’ Health Insurance Portability and Accountability Act (HIPAA) impose strict requirements on how specific data is accessed, protected, and shared.
This is crucial in industries such as healthcare, finance, and legal services, where compliance requirements come with serious consequences for violations. For instance, if a US-based healthcare organization relies on a cloud provider with servers located in Germany, it must adhere to both HIPAA and GDPR regulations. Failure to meet the standards of either could lead to severe penalties. In this instance, fines can reach up to $2 million per HIPAA violation and €20 million for a GDPR breach.
Therefore, understanding which data sovereignty laws apply — and how to comply with them — is essential for any business that operates in multiple countries or stores data in the cloud.
The growing compliance challenge for the cloud
Public cloud providers are aware of these different frameworks, and they often have certifications that show they follow certain rules. However, their shared systems can still come with unique risks.
In these shared cloud setups, many organizations use the same infrastructure. This means that a mistake or security issue in one company’s setup could potentially affect others. It’s also harder to check whether the cloud provider’s security measures meet your organization’s specific needs, because you don’t have full control over the system.
These growing challenges make it clear: businesses with strict, high-stakes compliance requirements need cloud solutions that offer greater control and visibility so they can better manage compliance and safeguard sensitive data.
The greater control of private cloud solutions
Private cloud hosting gives your organization more direct control over your IT environment — an essential advantage for maintaining strong compliance, protecting critical data, and supporting data sovereignty in a fast-evolving regulatory landscape. With private clouds, you benefit from:
Location-specific hosting
With private cloud solutions, you can choose exactly where your data is stored, down to a specific country, state, or facility. This level of control helps your organization comply with regional data regulations and reduces the legal risks tied to international data transfers.
Dedicated infrastructure
Private clouds run on infrastructure reserved exclusively for your organization. The isolation reduces the risks associated with shared environments, enhancing data protection and strengthening your compliance posture.
Custom policies and granular control
Private cloud environments allow you to create and enforce tailored security policies, access controls, and operational procedures that align precisely with your internal standards and industry regulations. Such flexibility makes it easier to meet specific compliance requirements.
Streamlined audits and reporting
Greater control over your environment means easier, faster compliance checks. With all data stored securely in one place, audits become more straightforward. Records are automatically organized and kept up to date, minimizing the chances of missing or outdated information during reviews.
Concerned about data sovereignty or compliance? Reach out to Liberty Center One and discover how our private cloud solutions can keep your data secure, compliant, and under your complete control.