“Enormous financial stakes, a long-term view of investments and profitability, being fiercely determined to succeed and always striving for operational excellence.” For John Dinsdale, chief analyst at American research and studies group Synergy Research, these are the conditions required of aspiring leaders in the global cloud computing market. However, “no European company comes close to fulfilling all these criteria, and the six leaders are all American companies,” he notes.
Amazon, Microsoft and Google now combine to make up 72% of the EU cloud computing market, currently worth €10.4 billion. However, their main European competitors, such as OVHcloud and Orange, each only take 2% of the pie.
Given this, what challenges should Europe address? What solutions should it put forward to overcome its weaknesses? Jean-Claude Laroche, President of Cigref, explains this shortcoming by the European companies’ lack of presence in the cloud computing market. “Our situation is: we are dependent on American hyperscalers, which is detrimental however you look at it, whether in terms of protecting data and processing, in terms of finance or in our business relationships with these players. The challenge is to have our own industrial champions!” he says.
“There is no time to waste!“
However, for Michel Paulin, head of OVHcloud, the weakness is not just technological. “If we look at all the ecosystems of European players in cybersecurity, cloud computing and software, today we have all the building blocks we need for champions, but we do not have players as big as the Chinese and the Americans, players that can become one-stop shops offering a complete range of solutions.”
Can Europe still become a major player in cloud computing? For Thierry Breton, European Commissioner for the Internal Market, the solution first requires resilience. “While we are building an internal market of industrial data, cloud computing is a matter of digital and industrial sovereignty. More than ever, Europe must ensure the development of a secure, trusted digital space. For this, we need innovative but secure data management systems. Our systemic rival partners are investing massively. There is no time to waste!”
American hyperscalers’ monopoly also raises the issue of transparency between cloud computing providers and customers, says Shahmeer Amir, a Pakistani ethical hacker. In response to this, he suggests that the EU require strong, clear transparency with solid data protection regulations, especially for cloud computing environments. “These legal frameworks would guarantee that all this cloud infrastructure is monitored, that it will be able to securely solve these problems,” he says.
“Europe must be strategic“
To ensure that intellectual property and sensitive information is effectively and securely protected, Shahmeer Amir recommends a European policy that promotes smart, healthy diversity and competition between cloud computing providers. “Monopoly implies a lack of transparency. And when there is a lack of transparency, sensitive data and information can be hacked or leaked.”
For Jean-Claude Laroche, a pan-European trusted cloud is necessary. It must fulfil four basic requirements: “it balances the relationship between the service provider, transparency, portability of solutions and interoperability; there are secure cybersecurity solutions; there are solutions that address social and environmental problems while mastering the environmental aspect of digital technology in the cloud; it protects against interference from non-European intelligence servicers“.
These requirements are listed in the standards developed by Cigref and included in France’s SecNumCloud certification. “Now, we want there to be equivalent requirements at the European level. It’s absolutely essential if we want a trusted European cloud provider with a high level of certification and to be protected against extra-territoriality,” says Jean-Claude Laroche.
For Michel Paulin, European requirements in traceability and transparency, such as EUCS and the Digital Market Act, give European operators a competitive advantage that benefits customers. Furthermore, Europe is clearly the leader when it comes to data protection.
Nevertheless, how can we create a shared ecosystem that can rival those from China, the United States, South Korea and Israel? “These countries supported champions with strategic government that set a long-term ambition with regulations, certification and funding for support. In all these areas, Europe must be strategic,” he says.
He also says that there must be financing. “Without a Nasdaq, we must help companies obtain their own funds and lines of financing in order to grow. The IPCEIs (Important Projects of Common European Interest) are one of the mechanisms to achieve this.” We must also expand public contracts and private contracts from large companies to build this European ecosystem, boost research and development through public-private exchanges like those at Stanford, Harvard and MIT, and resolve the shortage of talent.
“We don’t have enough engineers in Europe. So, instead of spreading our subsidies too thin, we should reinvest in universities to train more engineers and PhD students who will want to stay in Europe,” says Michel Paulin.
“The war is not lost“
For Shahmeer Amir, raising awareness among people, users, companies and the government is fundamental. “We often think that we know, but we don’t. Also, it’s always a good idea to get together, ask questions, listen and then gather and combine all these needs and expectations into a verified policy recognised by at least 90% of people, which will then be applied.”
“Europe needs to pull itself together. It’s an absolute necessity. There needs to be a real strategy and industrial policy at the European level. We need to set priorities and keep to them!” says Jean-Claude Laroche. For Alain Issarni, CEO of NumSpot, however, the war is not lost. “There are fatalists, and there are those who do not believe it to be lost: we should target the latter!”
He suggests starting small and with great ambition. “Does Europe want to start a cloud computing revolution? I hope so. Can it do it? Definitely yes. Can it avoid it? No. Therefore, we need to develop credible alternatives in cloud computing and be a part of this revolution. Otherwise, we will be left behind!”