Increased security and reduced cost of implementation are key factors in the growth of Cloud services, according market researcher TechNavio, which projects the Private Cloud Server and Cloud Software Services sectors will expand at compound annual growth rates of 12.7% and 18%, respectively, through 2014 in a recent report.

Unlike Public and Community Cloud infrastructures, Private Clouds are intended, from a privacy standpoint, to serve individual companies. They can, however, be managed by a company itself or a third party and be hosted internally or externally. TechNavio’s impressive growth projection for the Private Cloud Server sector is due, in part, to the delivery of higher levels of security for customer applications by vendors such as IBM, HP and Dell.

Issues regarding performance and application availability may continue to hinder the market’s potential, however.

Cloud software services are the tools provided to organizations and individuals through the various types of Cloud platforms: Public, Community, Private or a hybrid of any of the three. Overall, they are expanding thanks to a general trend toward reduced corporate IT services. In addition, the cost of implementing these services has been reduced by a number of Cloud Systems Management Software vendors, further stimulating adoption in spite of ongoing concerns about data security, TechNavio said.

No surprise there, as security and privacy concerns should always be at the top of any IT professional’s checklist when a evaluating a software, hardware or service platform—Cloud-based or otherwise.