Macquarie Telecom, Fujitsu, Infoplex and VMware have formed the OzHub, a national cloud council which aims to promote cloud computing to enterprises, small businesses, consumers and governments in Australia.

The council will also address potential barriers to cloud computing such as data sovereignty concerns. The formation of the OzHub comes at a time that Apple is set to launch its iCloud service, the first product launch by the California-based tech giant after the Oct. 5 death of its founder Steve Jobs.

"Given the growth in Gmail and Dropbox, and with Apple introducing iCloud, consumers have a keen interest in this technology. The world-class National Broadband Network, for example, presents us with a huge opportunity to service demand, now and into the future. We can build jobs and skills at home and we can ensure that local consumers get access to quality local cloud services," ZDNet quoted Innovation Minister Kim Carr, who spoke at the OzHub launch on Wednesday in Canberra.

Cloud computing involves placing of user files in data servers which could be accessed using different high-tech gadgets such as laptops, mobile phones and tablet computers.

A Lateral Economic report authored by Nicholas Gruen said Australia has the potential of becoming a regional hub for cloud computing due to the large-scale investments by telcos and enterprise players. Mr Gruen urged the Australian government to invest and legislate around the cloud computing industry.

"Just as Swiss banks are attractive to global depositors, in substantial part because of supportive Swiss regulation, so the Australian government should regulate the cloud so that we're a preferred provider for firms, governments and other users offshore. Indeed Australian governments should be prepared to import cloud services from any country that gives them similar confidence and that will mutually recognise our own offerings to them," CDNet quoted Mr Gruen.

He identified the issues of data sovereignty and privacy as issues for legislation to address. Mr Gruen cited Microsoft's acknowledgment to the UK government that the software giant could not guarantee that data stored in servers based in the European Union under cloud computing could not leave the area if requested by the U.S. Patriot Act.

OzHub said it plans to add more members to the national cloud council, while the Australian Information Industry Association (AIIA) welcomed the Lateral Economics report and the formation of OzHub.

"We face strong international competition and our own unique challenges in this marketplace, which is why we must capitalise on our strengths and work intelligently towards positioning ourselves in a market that will be very significant into the future," AIIA Chief Executive Officer Suzanne Campbell said in a statement.