Even as an increasing number of Indian firms look at embracing cloud computing, data security continues to remain a primary concern for them, said research firm Deloitte.

Cloud computing allows companies to use services, softwares and applications on a pay-per-use model without actually owning any hardware infrastructure or licence.

This helps companies save on setting up IT infrastructure or purchasing licences.

"A lot of Chief Information Officers (CIOs) express concern over data security in a non-cloud environment. This concern is only heightened when their data is hosted on a server elsewhere," Deloitte senior director Sundeep Nehra said.

However, he declined to comment on the investments being made for cloud computing, or the potential opportunities for security solution providers in this regard.

Citing an example, he said that in a 500-bed hospital, hundreds of medical images and medical records may be stored.

Any data loss could hamper the diagnosis of patients.

The situation gets complicated in the case of banking and financial services, where data on millions of transactions has to be stored everyday.

"Information is critical, and as companies would invest in securing data on their own premises, they also need to ensure that their data on the cloud is secure," he said.

Companies like Amazon.com, Microsoft and Google offer cloud computing services globally.

Analysts peg the Indian cloud computing market to be worth more than USD 200 million. While small and medium-sized enterprises seem to be adopting cloud computing faster, large companies are also keen on moving in that direction for optimising costs.

These companies have the option of moving to either a private cloud or a public cloud (where solutions and data of more than one company are stored).

However, security becomes a primary concern when the data is hosted on public clouds.

"Since data of more than one company is hosted on public clouds, it is but natural that firms become apprehensive about the security of their data," Nehra said.

Data loss on a cloud can happen when it is accessed without proper authorisation, or through hacking.

"Similar to normal data centres, clouds are also vulnerable to data loss, either deliberately or by mistake.

Hence, it is important that companies invest in data security," he said.

"We advise clients to invest in data leakage protection (DLP) solutions from various vendors like CA, McAfee and Symantec," Nehra added.