The stringent laws which govern Swiss banks are derivative of the nation’s privacy legislation, and now – thanks to the PRISM scandal – the country is fast becoming the ideal location for those turning their back on the cloud.

Recent leaks of the American National Security Agency’s (NSA) PRISM surveillance program have sparked growing concern over data privacy, with implications for global corporations using US-controlled cloud services, such as AWS, Azure and Dropbox. As a result, businesses are now turning to Switzerland for their data hosting needs.

Swiss ‘private’ hosting companies are seeing huge growth because privacy in Switzerland is enshrined in law. As the country is outside of the EU, it is not bound by pan-European agreements to share data with other member states, or worse, the US. Artmotion, for example, has witnessed 45 per cent growth in revenue amid this new demand for heightened privacy.

Until now the PRISM scandal has focused on the privacy of the individual, but the surveillance undertaken by NSA and Britain’s own GCHQ has spurred corporate concern about the risks associated with using American based cloud providers to host data. It is especially troubling for businesses with data privacy issues, such as banks or large defence and healthcare organisations with ‘secret’ research and development needs.

Before PRISM, the US was at the forefront of the cloud computing industry and companies worldwide flocked to take advantage of the scalable benefits of cloud hosting, as well as the potential cost savings it offered.

However the scandal has unearthed significant risks to data for businesses, as well as for their customers. With US cloud service providers, the government can request business information under the Foreign Intelligence Surveillance Act (FISA) without the company in question ever knowing its data has been accessed.

For businesses large and small, data vulnerabilities and the threat of industrial espionage from US hosting sites can present real security risks or privacy implications, and it’s causing a real fear. Business owners are worried that by using US based systems, private information could potentially be seen by prying eyes.

The desire for data privacy has therefore seen a surge in large corporations turning to ‘Silicon’ Switzerland to take advantage of the country’s renowned privacy culture, which helps them host data without fear of it being accessed by foreign governments.