Many providers, he said, also do not take into account that users, especially in mainland Europe, have regulatory or other legal obligations and may need to demonstrate compliance to regulators.

Millard said: "To remain competitive providers may have to be more aware of user concerns, more flexible in negotiations, and more willing to demonstrate the security and robustness of their services.

"In the middle or low value markets, choice is still limited, and many contract terms are still inadequate or inappropriate for SME users' needs, as they may lack the bargaining power to force contract changes."

According to the research there are signs of market development though. Where large users have negotiated amendments and thereby helped educate providers about user concerns, these changes are likely to filter down to the middle market at least.

CLP research consultant, Kuan Hon, said: "The findings suggest that more customer-friendly terms are being demanded by large cloud users such as governments and financial institutions, and being offered or agreed by niche specialist providers and market entrants, making contract terms a source of competitive advantage."