Making a Europe fit for the cloud

By Danny Palmer
16 Oct 2012 View Comments

While Europe teeters on the brink of financial armageddon, the European Commission (EC) claims that a coherent cloud strategy for the bloc could generate £127bn per year and create 3.8 million jobs.

Further reading

In its Unleashing the Potential of Cloud Computing in Europe report, the EC suggests that implementing a coherent cloud strategy across the region could cut the operational costs of IT departments for all types of organisations, along with boosting productivity and growth.

According to the report, three key areas need to be addressed in order to enable a workable cloud strategy across Europe.

The first is “cutting through the jungle of technical standards”. Technology providers currently fight for market share by locking their customers into their service, preventing the adoption of standardised, cross-industry approaches to the cloud. This prevents interoperability, data portability and reversibility (the ability of customers to take data and functions back in-house again), making cross-European cloud implementation difficult. The EC wants to identify methods to implement standardisation of cloud services across Europe by next year, the first step in a process that envisages lasting until 2020.

The report also identifies contractual issues. Cloud contracts are often complex and uncertain, leading to worries over data access and portability. It also suggests that while “take-it-or-leave-it” contracts might be advantageous for cloud providers, they’re often undesirable for users of the service, with many failing to identify liability in the case of failures due to downtime, for example, or to make clear how service issues will be compensated and resolved.

While EU legislation to protect cloud users is already in place, consumers are often unaware that it exists or how it operates in their own member state. The EC therefore proposes that model terms for cloud computing contracts be developed to standardise best practice, with the IT industry being consulted on a code of conduct for cloud providers. It is hoped an agreement on a code will be reached in 2013.

Reducing market fragmentation

The fragmentation of the “digital single market” also needs to be addressed before a coherent cloud strategy can be implemented across Europe. Currently, the different national legal frameworks across member states (see below), combined with uncertainties over how digital content and data laws operate when crossing borders, stand in the way of a single European standard.

The theory is that by collaborating on cloud strategy, member states will reduce fragmentation across Europe in areas such as law and digital security, allowing better detection and prevention of cyber-crime.

That’s not to say the strategy is based around a “European Super-Cloud,” a suggestion the EC is keen to refute. Instead, the aim of the policy is to provide an umbrella organisation. This European Cloud Partnership will bring together industry experts and public-sector agencies – such as those responsible for G-Cloud in the UK and Andromede, its equivalent in France – in order to help provide a cloud infrastructure that all member states will benefit from. Identifying the key needs of the public sector is seen as a vital issue in successful implementation of an EU cloud strategy.

The EC is also seeking to promote the adoption of similar standards in countries outside of its jurisdiction. The document makes reference to the need for a “reinforced international dialogue” in a world that’s increasingly free of borders due to the spread of the internet.

American businesses, including Amazon and Microsoft, already have a major cloud presence within the EU, meaning that the US potentially has much to gain from a Europe-wide cloud strategy as they too will be able to take advantage of improvements in infrastructure and clarity of the regulations.

However, the EC’s cloud strategy is likely to be met with some scepticism by the US business community, which often views European data protection laws as harmful to transatlantic trade. The EC’s plans do little to address this impasse, potentially frustrating American technology organisations who would like to see a free flow of data between Europe and the US.

There has long been tension between the US and the EU when it comes to transferring data, not least because the United States Patriot Act – signed by George W Bush in the aftermath of 9/11 – overrides EU data protection laws, allowing the US government potentially to access personal data stored anywhere on the globe. This issue is barely addressed by the EC cloud strategy.

Closer to home, the report claims that if the strategy is adopted, Europe will benefit from an annual boost in GDP of €160bn (£127bn), an increase of one per cent on current output, with a net gain of 2.5 million jobs as the infrastructure around the cloud is created and maintained. However, the main strategy document for the scheme said that 3.8 million jobs will be created in total. Presumably, therefore, the EC is conceding that 1.3 million IT jobs will disappear.

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