Adelaide University has warned the nation’s business leaders to be aware of the risks associated with cloud computing, not just its many advantages.

Speaking during National Cyber Security Awareness Week, technology law expert Nigel Wilson from the University of Adelaide's School of Law says that while the use of cloud computing is rapidly growing, many still do not understand the potential problems associated with it, and the legal pitfalls.

Cloud computing is where users store their data on remote servers, through private or public cloud servers or a combination of both. There are many advantages to personal and business users of cloud computing, such as not needing to upgrade data storage capacity, thereby saving on costs.

"Cloud computing is an important technology and has been rapidly adopted by major corporations, governments and others right around the world, and for good reason. But like all technologies of this nature you need to be careful when using them," says Mr Wilson, who is Co-Director of the Technology Regulation and Information Policy Research Group at the University of Adelaide Law School.

"Security of data and protection of identity are major issues. Web and computer-based technologies, such as cloud computing, have an ever-present risk of hacking, data corruption or loss.

"When data is stored 'in the cloud', often on remote servers located outside Australia, complex issues can arise from a forensic and legal point of view."