What is cloud data residency?

Data residency refers to the geographic location, the country or region where an organization chooses to store their data. Whether it’s on-premises, in the cloud, or in a remote data center, the location of an organization’s data presents certain legal and compliance implications. For example - most countries have diverse data protection regulations, defining how data must be handled, protected, and transferred.

Tight regulations, such as those that restrict companies from moving data from one location to another, can affect commerce and/or cause companies to rethink their practices. Some cloud managed services providers have local data centers to meet the requirements of individual governments. Since data residency acknowledges the location of stored data, it is an important piece of data management solutions.

Data residency is often confused with data localization, a different concept which states that data created within a country must remain there. Some nations merely require that a copy of data reside locally, but there are some that insist their citizens’ data be stored in local data centers.