What Are the Security Risks of Cloud Computing?

What Are the Security Risks of Cloud Computing?

As the global cloud computing market continues to escalate from $545.8 billion in 2022 to a staggering $1,240.9 billion by 2027, it’s crucial to understand what “cloud computing” entails. Essentially, cloud computing refers to the use of software and services that operate over the internet, with internal or customer data stored in cloud environments managed by cloud service providers. While cloud computing has numerous advantages, it is not without security threats. Data security is critical when it comes to cloud computing. Although cloud environments may introduce certain vulnerabilities, they are not inherently more prone to cybersecurity threats, such as data breaches or cyberattacks, compared to traditional on-premises systems. Cloud security risks are a major concern for businesses who are considering moving to the cloud or for those who are already using cloud computing solutions. This article aims to explore the various security risks in cloud computing while balancing them against its numerous advantages.

How Secure Is Cloud Computing?

Cloud computing is a popular solution for businesses due to its scalability, cost efficiency, and convenience. However, many organizations are concerned about the security risks associated with cloud computing. So, how secure is cloud computing? A reliable cloud provider will have robust security solutions in place, such as encryption, firewalls, and intrusion detection systems, to protect data stored in the cloud. The vast majority of cloud service providers undergo regular and consistent security and maintenance reviews. Additionally, the level of security can also be influenced by the organization’s own security practices. This includes implementing strong authentication mechanisms, regularly updating security solutions, and monitoring for any suspicious activities. However, it is in the best interest of cloud service providers for their own success and longevity to maintain tight security controls in order to keep existing clients satisfied and to foster new ones. While cloud computing does come with its security risks, these risks can be mitigated by working closely with a trustworthy cloud provider, implementing comprehensive security measures, and regularly assessing and addressing vulnerabilities. Currently, the largest web services provider is Amazon Web Services (AWS), and they offer security compliance and certifications for SOC 2, HIPAA, GDPR, PCI-DSS as well as many other regulatory needs required to satisfy numerous worldwide criteria. By understanding the potential risks and implementing the appropriate security measures, businesses can confidently harness the benefits of cloud computing without compromising the security of their sensitive data.

What Is Data Security in Cloud Computing?

What are the security risks in cloud computing? Data security in cloud computing refers to the protection of sensitive data stored, processed, and transmitted in cloud environments. It involves implementing various security measures to safeguard against unauthorized access, data breaches, and other threats.  One of the key aspects of data security in cloud computing is the identification and mitigation of vulnerabilities and misconfigurations. Cloud environments can be complex, and if not properly configured, they can create opportunities for attackers to exploit. This includes ensuring proper authentication and access management, implementing multi-factor authentication, and regularly checking for misconfigured permissions. Data security protects against unauthorized access, maintains data integrity (often through digital signature, content authenticity, and secure transactions), and ensures the reliable availability of information whenever needed. Cloud-based data is stored in systems outside of the traditional office locations and offsite from a business’s physical plant or campus. This shift accelerated rapidly after the COVID-19 pandemic began, as more and more companies have shifted to cloud data services in order to facilitate transient workforces and employees moved to work from home wherever possible. In fact, 57% of businesses migrated their workload to the cloud in 2022. Today’s organizations need a security strategy focused primarily on securing data and information and secondarily on physical assets and infrastructure. Read ten tips on how to prevent cybersecurity breaches for information and recommendations on how to protect against a data breach.

The InfoSec Survival Guide: Achieving Continuous Compliance

What Are the Security Risks of Cloud Computing?

The security risks in cloud computing overlap in many ways with more traditional data center environments. In both cases, cyber threats focus on taking advantage of and exploiting vulnerabilities in software. Another major risk is the potential for data breaches and cyber-attacks. Public clouds, in particular, can be attractive targets for hackers due to the large amount of data they store. Organizations must take steps to protect against these attacks, including implementing robust network security measures, regularly updating security solutions, and monitoring for any signs of suspicious activity. With cloud computing, however, instead of an organization mitigating or accepting physical security risks, they transfer them onto another service provider. As a result, the business contracting with a cloud service provider is responsible for mitigating a new set of risks through their own due diligence regarding security protocols, regulatory compliance maintenance, and more. Understanding the risks and implementing a cybersecurity risk program is key to determining if cloud services are the right choice for your company’s software needs. Some of the top risks include:

1. Limited Visibility 

Limited visibility is a significant concern when it comes to cloud security. It refers to the lack of transparency and control that organizations have over their data and systems in the cloud. This limited visibility can leave businesses vulnerable to various vulnerabilities, misconfigurations, and other cloud security threats impacting their security posture. When businesses shift operations, workloads, and assets to the cloud, the move transfers the responsibility of managing some of the systems and policies from inside of the organization to the contracted cloud service provider (CSP). This results in a forfeiture of some visibility into network operations, security settings, resource and service usage, and cost. Organizations must take care to monitor their cloud services usage with additional tools like cloud security configuration monitoring, network-based monitoring, and additional logging. Setting up protocols important to your business up front with your CSP can help alleviate these concerns and provide the transparency your organization needs.    

2. Data Loss

Backups are critical as a defensive tactic against data loss, and cloud storage is considered highly resilient due to redundant servers and storage functionality across various geographic locations. While cloud storage offers redundancy and resilience, it is not immune to data loss. One common cause of data loss is ransomware attacks. These malicious attacks can encrypt or delete sensitive data, making it inaccessible to the rightful owner. Organizations must be vigilant and implement robust security measures to protect against ransomware attacks and cloud storage is still vulnerable to the same natural disasters as anything else. One example of this is when one of Amazon’s Web Services’ data centers lost power and experienced failed backup generators in 2019, resulting in unrecoverable customer data. That said, this is rare and AWS reported that less than .5 percent of systems were unrecoverable.. 

3. Compliance Issues

Organizations need to be diligent to make sure they remain in regulatory compliance with the requirements specific to their industry and geographical location. When using cloud-based services for your data, you must ensure data access and storage needs around Personally Identifiable Information (PII) are being met by the service provider in line with HIPAA security and privacy rules, GDPR, or other areas specific to your business. In addition, cloud services typically allow for larger-scale data access, so companies need to confirm the proper access controls and appropriately leveled security measures are in place. It is important to conduct regular audits and assessments to identify and address any vulnerabilities or misconfigurations in the cloud environment. Connected compliance management software will aid organizations in staying on top of regulatory compliance demands. 

4. Cybercriminals

Cybercriminals are on the rise, with the Federal Bureau of Investigation’s 2022 Internet Crime Report reporting that cyber crimes were up 69% year-over-year. Over half of the malware attacks delivered in 2022 sent their payloads via cloud-based applications. According to Security Intelligence, using cloud apps helps modern attackers evade older email- and web-based defensive solutions. Denial of Service (DoS) attacks are used by cybercriminals to make servers — and therefore services — unavailable to legitimate users. In addition, in some cases, DoS attacks are used to distract from other, simultaneous actions or to threaten and overwhelm online firewalls.

5. Insecure Integration and APIs

Insecure integrations and APIs pose a significant security risk in cloud computing. Integrating different cloud services or utilizing application programming interfaces (APIs) can introduce vulnerabilities and misconfigurations that attackers can exploit. This is especially true if organizations fail to properly vet these integrations and APIs for security standards. One common issue with insecure integrations is the use of weak or outdated protocols that can be easily breached by attackers. In addition, insecure APIs can provide unauthorized access to sensitive data or allow attackers to manipulate the cloud environment. This can result in data breaches, unauthorized data modifications, or even the complete compromise of the cloud infrastructure. To mitigate the risks associated with insecure integrations and APIs, organizations should prioritize secure integration practices. This includes carefully selecting integration partners or APIs that have a strong security track record and robust security controls. Regularly updating and patching integrations and APIs is also crucial to address any vulnerabilities that may arise.

6. Insider Threats

Insider threats pose a significant risk to the security of cloud computing. While we often focus on external hackers and cyber attacks, it’s important to recognize that individuals within an organization can also compromise data security intentionally or accidentally. One of the main vulnerabilities associated with insider threats is the misuse or mishandling of data. Employees with access to confidential data may intentionally leak or steal information, which can have serious consequences for a business. Additionally, employees may inadvertently cause a security breach through actions such as clicking on a malicious link or falling for a phishing scam allowing cybercriminals the ability to gain access to sensitive data. Another misconfiguration that can lead to insider threats is weak access controls. If employees have unnecessary or excessive access privileges, they may inadvertently expose sensitive data to unauthorized individuals or external attackers. This can result in data breaches, loss of intellectual property, or damage to an organization’s reputation. To mitigate the risks of insider threats, organizations must prioritize access control and employee education. Implementing strict access controls, including role-based access and multi-factor authentication, can help limit the potential damage caused by an insider threat. Regularly monitoring user activity and promptly revoking access for employees who no longer need it is also essential. Employee education is crucial for preventing accidental insider threats. Training employees on the importance of data security, how to identify phishing attempts, and how to handle sensitive information responsibly can significantly reduce the risk of insider threats. By addressing vulnerabilities and misconfigurations associated with insider threats and prioritizing access control and employee education, organizations can enhance their cloud security and protect their sensitive data from internal threats.

What Are the Main Benefits of Moving Data to the Cloud?

For many businesses, moving data and services to the cloud improves data security protections, brings down costs, increases scalability and flexibility, eases employee work-from-home capabilities, and significantly reduces the risk of cyber attacks. The main benefits of moving data to the cloud are improved security, scalability, and savings.

1. Security 

Effective cloud computing can be more secure than traditional networking. In the shared responsibility and liability model there are redundancies in place that enhance data security. Data is in the cloud, so if something happens to a company’s physical assets or machinery, their data is still safe and accessible. In addition, most large-scale cloud service providers offer security analytics, make consistent security updates, and provide cross-enterprise visibility. By storing data in the cloud, businesses can also mitigate the risk of cyberattacks and data breaches. Cloud providers constantly monitor their infrastructure for any suspicious activity and employ sophisticated intrusion detection systems to detect and prevent potential attacks. This level of monitoring and protection from security threats is often beyond the capabilities of most businesses’ internal IT teams. Furthermore, the cloud allows organizations to enhance their network security by reducing the attack surface. With on-premise infrastructure, organizations need to secure all endpoints and devices that have access to the data. In a cloud environment, organizations can centralize security controls, making it easier to manage and enforce permissions for data access. Amazon Web Services, the largest provider, also maintains compliance certifications that are important to many industries, including HIPAA, ISO 27001, and AICPA/SOC. If your industry requires data security regulatory compliance in those areas, finding a cloud services provider that maintains compliance controls can bring tremendous peace of mind.

2. Scalability

Scalability is a crucial aspect of any growing business, and moving data to the cloud offers unmatched scalability opportunities. Unlike traditional on-premise infrastructure, where businesses need to invest in additional servers and storage as their data needs expand, cloud computing provides a more flexible solution. With Infrastructure-as-a-Service (IaaS) offerings, businesses can easily scale their storage capacity to accommodate their growing data requirements. The public cloud, in particular, offers infinite scalability possibilities. Companies can easily rework their infrastructure, workloads, and workflows to evolve with cloud services as their needs shift. In turn, this allows businesses to grow without negatively impacting performance or customer experience. Cloud software often results in improved agility, increased efficiency, and higher workforce productivity. In an age of an increasingly remote workforce — where many companies are abandoning the notion of a central office — cloud programming and accessibility also reduce barriers and friction for employees when they are working remotely. Plus, companies no longer need to devote real estate to expensive devices, equipment, and storage. 

3. Savings

The vast majority of cloud computing programs and applications use a subscription-based model. This is great for cost-cutting, as businesses change service usage and commitments up or down according to their needs and budget. This also reduces — or even eliminates — the costs of major capital expenditures. Team efficiency is improved and operational costs are reduced when the IT processes are refined. Furthermore, cloud storage expenses are pay-what-you-use, so pricey data centers do not need to be maintained as consumption needs decrease. Costs are instead assigned based on usage. As mentioned in the scalability section, cloud software also improves the ability and ease of remote work and greatly reduces costs regarding physical space needs and leasing. Cloud storage allows for seamless access to data from anywhere, at any time, as long as there is an internet connection. This enables employees to work remotely and collaborate in real time, improving productivity and efficiency. Relevant maintenance, power, and staffing costs also go down following those same cost savings.

How Can I Preserve Data Integrity in the Cloud?

Human error, malicious cybercriminals, and their attacks, and insider threats are top risks for cloud data integrity. To protect against these issues, it’s crucial to follow standard risk assessment protocols. Access controls that are versioned for unique users are important to confirming and maintaining data integrity. Companies need to create and manage audit trails and regularly monitor user activity, including failed access attempts, file modifications, and access to sensitive and privileged data.

How Can I Ensure Data Privacy in the Cloud?

The confidentiality of data is not only important to your business, but it’s also key to meeting many of the international regulatory compliance requirements created to ensure businesses keep sensitive customer information secure. Failing to meet those requirements can cause a possible data breach, and may also result in significant financial penalties due to lack of compliance. A common way companies ensure data privacy is encryption, which makes it difficult for unauthorized parties to view or understand stored or shared data. Cloud encryption vendors and services are available to keep cybercriminals from gaining access to your company’s protected data. Another solution for cloud data privacy is enabling simple security features like multi-factor authentication for data access.

How to Choose the Right Cloud Computing Solution

What are the security risks of cloud computing when stacked up against the benefits? The few manageable risks are easily overcome by the many benefits of working in the cloud. The cost savings, scalability, and security — plus the seamless ease by which personnel can engage in remote work — make cloud computing the right choice for many of today’s leading companies. Choosing the right technology for your business will mitigate your organization’s risk, and AuditBoard’s compliance management software can transform how your enterprise manages it. With the right technology, proper research, and due diligence, there’s no need to fear putting your business ahead in the cloud.


Brett Deemer began an extensive IT career in the United States Army, specializing in encrypted communications, and has spent the last 8 years performing security risk assessments, gap analysis, and enhancing compliance programs for businesses across multiple industries. Brett’s career is marked by a commitment to establishing and optimizing GRC frameworks, fostering a culture of compliance, and driving technological innovation. Connect with Brett on LinkedIn.