(first posted on LinkedIn on Jan 18, 2015)
While the US-based but globally located public cloud winners march ever eastwards across Europe laying down new cloud data centers in more and more member states, for the 50,000 EU managed service providers across 28 member states it is squeaky bum time.
TL;DR Cloud28+ is billed as a “politically backed” federated cloud that will create a single common european wide market place for datacenter providers in all 28 member states to publish and subscribe to europe-wide services. This has been forecast by IDC to improve the digitalisation of Europe leading to higher GDP and employment levels. But why d0es Europe need Cloud28+ at all? Is this an EU protectionist trade block against US global cloud providers? Is this initiative likely to benefit large European players like HP?
What is Cloud28+?
It’s not a particularly new initiative and there’s some great information here.
HP has has called for a “cloud of clouds” across the EUs 28 member states:
HP has set up a non-profit initiative, known as Cloud28+, to help make this happen. In parallel, HP is working closely with the EU across a number of projects tied to security and compliance, in order to boost intellectual property and standardisation across the region.
“We’ve also launched the Cloud28+ project, uniting all the different industry players – Service Providers, government, software vendors, channel partners, etc., to build one common European service catalogue in trust. The goal is for all enterprises to be able to subscribe to cloud services aligned to their business needs. Cloud28+ will not be operated by HP: It’s intended to be a self-governed organisation in line with EU data protection rules and policies, increasing cloud service adoption in the region.”
“By promoting open source technologies, such as OpenStack, as well as this European ecosystem, we believe HP offers greater business value for our customers
This initiative raises more questions than it answers at this early stage, and here are some important ones.
What does “politically backed” mean?
It’s hard to unify twenty-eight countries that speak different languages, have different laws and cultures, and for hundreds of years were at war with each other for one reason or another. The only way to do this is to have a central parliament and set laws in the centre and force them on all 28 members. Big countries and big companies, like HP, have more power and influence and even though they say they don’t want to “dominate” Cloud28+ it will happen anyway.
Why does Europe need Cloud28+ at all?
One of the arguments for the need for Cloud28+ is this:
HP want to see an end to the fragmented nature of the European market, as it is a major barrier to growth. Compared to the relatively uniform market in the United States, a European start-up would need to adjust its offering to 28 individual setting, including considerations around data privacy, storage of digital documents and data security.
So you see, even though the EU is a single market and already has legal and monetary unification it is still a fragmented place, certainly in terms of law practices. Tried buying a house in another EU country?. Tried registering a business in 28 states? So this isn’t about technology at all, it’s about creating a “uniform market” which will require yet more legislation and rules. Right at a time when people in member states are voting for EU reform and less centralisation.
Europe is bound to have big problems: it’s a big project and not everyone wants to be in it. Go find out more at Open Europe.
Is this an EU protectionist trade block against US global cloud providers?
From the outside, the EU acts as a trade block and the single market it opines can be seen to be enforcing protectionism not free trade. Cloud28+ can be construed, especially with the “politically backed” statement, that it will protect EU cloud service providers from the US-backed public cloud providers. This will not lead to a good outcome for customers, but what about providers…
Is this initiative is strategically intended to benefit large European players?
This kind of “political backing” can also end up not being that good for providers operating inside the market either! Out of the 50,000 managed service providers in europe, ask yourself how many companies with a current single member state target market (e.g. UK local government) are interested in AND capable of executing business (sales, marketing, operations etc) across 28 states?
I can tell you who is interested and capable and top of that list is HP, followed by Atos SE, IBM, Fujitsu, T-Systems and the rest. You could argue that this unification is likely to increase costs for small, single member state companies and at the same time open their local market to these big boys. You could imagine that in a few years time, if Cloud28+ happens, that there will be significant consolidation of EU cloud service providers.
I’ll leave you with this from the Telegraph:
If the single market meant trade liberalisation, rules would be removed. Instead, pages and pages of extra EU rules are churned out each week.Which creates plenty of scope for vested interests to try to ban what their rivals do best.
If the single market meant greater freedom to trade, there would not be an army of corporate lobbyists in Brussels – representing French semi conductor interests amongst others – trying to help write the rules.
Under the single market, it has not necessarily been made easier to produce and sell things across Europe. Things can only be produced and sold if they conform to a prescriptive set of regulation. In effect, a set of permissions are needed to produce.