Headlines that consumer data managed by network security provider Omniquad have been published online is yet another example as to why consumers have a natural fear of the risks associated with online business activity.

This is according to the Cloud Industry Forum, which is in the final stages of developing an industry wide Code of Practice for online service providers. The Code of Practice will require vendors to provide transparency about their business, capabilities and accountability for the services provided to enable end users to make an informed choice.

IT security by nature needs to be a proactive and highly skilled discipline if it is to be effective in keeping the hacker at bay or preventing accidental breaches through infrastructure or application changes. However, when it comes to a breach, it does not matter how many customers are impacted or put at risk, the very nature of the issue undermines confidence, especially in regard to online services. Data breaches of any type or scale can have a devastating impact on consumer confidence to the ultimate detriment of both vendors and consumers alike.

According to the Cloud Industry Forum’s own research, which is due to be published next week, whilst there is overwhelming support for, and interest in, cloud computing, it is the lack of confidence by consumers that is the biggest hurdle to the mainstream adoption of the cloud. This was followed by major concerns specifically over security.

The combined figure was close to two thirds of the total sample so when breaches of this type take place, the impact is wholly negative, despite the tremendous advances that have been made in increasing the agility of IT operations and reducing costs for customers. This is why we have been calling for an industry wide Code of Practice so that consumers of cloud based or online services can have a more rational approach to assessing suppliers before they place their confidence in them.