A major setback for the fledgling cloud computing industry has occurred, after Microsoft admitted that it had suffered a cloud data breach on Wednesday.

Microsoft announced that data contained on its Business Productivity Online Suite (BPOS) had been breached and important information had been downloaded by unauthorized users, PC World reports.

According to Microsoft the problem was fixed two hours after being discovered. It is unclear however, how long the data was exposed, although the company says it has tracking facilities to contact the people that downloaded the wrong data.

Cloud systems allow users to quickly and easily share data with other people or the whole Internet, although the systems do feature some security risks, especially from hackers looking to steal private information from cloud data centres.   

This incident is likely to make people considering adopting cloud computing in the future more nervous about entrusting their data to cloud-based systems. This incident could also impact negatively on the uptake of Office 365, a cloud computing suite from Microsoft.