Why Data Residency Is Becoming An AI Strategy Decision, Not A Compliance One
Michael Nicosia, COO and cofounder at Salt Security.
gettyFor the better part of the last 10 years, data residency was usually something that came up when you needed to meet some compliance standard. You’d identify where data had to reside if you wanted to offer your service in another country. Consult the compliance standard and move on to the next task. You would then assign that to your legal department and IT to figure out.
That is no longer the case. With AI becoming embedded in the business process of companies, many are starting to see where data needs to reside earlier in the expansion journey. Where once data residency was relegated to the bottom of a list of tasks, it has crept its way up to a C-level concern. If you aren’t thinking about data residency, you may not realize you’re making that decision.
When dealing with traditional software, data is typically confined to a certain area. You have applications that store data and use that data to provide functionality, so where that data resides is a fairly simple question.
AI, however, works with data differently. It learns from that data and will use it to learn even more. Once you introduce AI into your business, you may find your data traveling to various places, such as across international borders, to feed your AI model. If you can’t trace back where your data went after an AI application began utilizing it, you may run into residency issues.
As more countries continue to update their regulations regarding where data can reside, you’ll find yourself having to account for this in your expansion plans.
If you’re looking to grow your business, it’s important to consider where data can reside when deciding where you want to expand. In some cases, it may not be possible to keep data within the country you wish to offer your services in. In some markets, if you can’t keep data in-country, you simply can’t do business there, no matter how good your product is. If your target customers care about where data resides and you are unable to meet that demand, you won’t be able to do business in that country.
By considering where data needs to reside before you begin your expansion into that country, you can avoid some headaches down the road—whether that be a delay in offering your service or building infrastructure that won’t meet the demands of your customers.
There are some questions that I believe leaders should be asking themselves when trying to decide where to place their data.
• Do you know where your data is located once you begin feeding your AI models with it?
• Are you thinking about data residency early enough? If you are waiting until you choose a country to expand into and then ask yourself where data needs to reside, you’re already too late.
• Can you prove where your data is located? Customers will want to know where their data is being kept. Make sure you have the ability to show your customers where their data is.
Data residency is no longer something that can be overlooked. It’s something that can dictate where you can offer your services and how long it will take to offer them. Once you factor in where your data will reside and how that will affect your AI, you can begin to create a roadmap that allows you to grow your business at a faster pace.
Forbes Technology Council is an invitation-only community for world-class CIOs, CTOs and technology executives. Do I qualify?
