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The state of Europes homegrown cloud market

Rene Buest, and Paul Miller

a cloud report

The state of Europes homegrown cloud market


09/17/2013

TABLE OF CONTENTS
1. EXECUTIVE SUMMARY 2. INTRODUCTION 3. EUROPE AND THE VISION OF A EUROPEAN CLOUD 4. EUROPEAN CONCERNS WITH INTERNATIONAL CLOUD PROVIDERS 5. THE RATIONALE FOR REGIONAL OR NATIONAL CLOUDS 6. EUROPES CLOUD PROVIDERS a. ProfitBricks b. T-Systems c. DomainFactory d. City Cloud e. Colt f. CloudSigma g. GreenQloud 7. CONCLUSION 8. KEY TAKEAWAYS 9. ABOUT THE AUTHORS 10. ABOUT GIGAOM RESEARCH 11. COPYRIGHT

The state of Europes homegrown cloud market This PDF prepared for: Marieta Oviedo Alfaro (moviedo@ice.go.cr)

Europes cloud market is dominated by the same providers that serve the rest of the world: Amazon Web Services, Microsoft Windows Azure, and Rackspace. Each of these global providers has a local presence in Europe. All have made efforts to satisfy European-specific concerns with respect to privacy and data protection. However, a growing number of local companies are developing cloud computing offerings in the European market. This report explores in more detail the importance of having these local entrants and asks whether Europes growing concern with U.S. dominance in the cloud is a real driver for change. The goal is to discover whether there is a single European cloud market these companies can address or whether there are several different markets. Key highlights from this report include: European concern about the dominance of U.S. cloud providers Rationale for developing cloud solutions within Europe The value of transnational cloud infrastructure The value of local or regional cloud infrastructure A representative sample of Europes native cloud providers

The state of Europes homegrown cloud market This PDF prepared for: Marieta Oviedo Alfaro (moviedo@ice.go.cr)

Introduction
Even before recent revelations of snooping by U.S. intelligence agencies, plenty of European businesses were wary of entrusting data to the American companies that currently dominate the global cloud computing market. Trust-building efforts such as the U.S. Department of Commerces Safe Harbor program and ensuring that European data could stay within Europe were all tactics in a broader initiative to woo European customers. For many these efforts were sufficient, and the European use of global cloud services has been increasing steadily. A minority, especially in France and Germany, remained skeptical, regularly raising concerns regarding the inappropriate use and transfer of data. Regional and national governments across the European Union, in particular, were extremely cautious about allowing sensitive data to move beyond the unions reach. In the aftermath of the PRISM leaks, perspectives have hardened. The European Commission has questioned the rationale for continuing with plans to update the Safe Harbor program. The Financial Times recently reported that German business leaders are now more concerned by U.S. snooping than by Chinese efforts in that area, and the reputational damage to the global cloud computing industry exceeds $45 billion (34 billion) by some estimates. Most of the attention and revenue in cloud computing remains dominated by a relatively small number of U.S. companies. And yet, in the U.S. and elsewhere, these companies are merely the visible tip of an extensive and growing market. Established co-location companies are pivoting to offer various cloud computing solutions. Startups are emerging, typically focusing on particular geographies or vertical market segments rather than competing head on with the likes of Amazon Web Services. In this report, we provide a European perspective on this broader market. We consider the European social and political drivers that pushed back against U.S. dominance long before Edward Snowdens leaks, and we explore the ways in which European sensibilities may amplify or restrict the potential of Europes emerging breed of cloud providers.

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Europe and the vision of a European cloud


Europe is home to almost 750 million people living in around 50 countries, and yet it is dominated economically, philosophically, and politically by the 500 million inhabitants of the European Unions 28 member states. Both within the continent and beyond its borders, the term Europe all too often simply means the EU. Similar confusion applies to Europes cloud providers: Several of the best-known providers (Switzerlands CloudSigma or Icelands GreenQloud, for example) are headquartered inside Europe but operate outside the EU. The European Commission (EC), the administrative arm of the EU, has an interest in encouraging EU companies and citizens to embrace the efficiencies of cloud-based services. The EC also has a separate but related interest in nurturing the growth of local cloud providers capable of meeting some of this demand. Europe still lags behind North America in cloud adoption. The continents population is more than double that of North Americas, but recent figures from GigaOM Research analyst Rob DeFrancesco suggest that North America spent $78.4 billion this year (a projected $95.3 billion in 2014) for cloud services while Europe only spent $34.6 billion (a projected $44.4 billion in 2014). The European Commissions 2012 cloud computing strategy has bold targets to both accelerate adoption and nurture homegrown providers. It is less likely, though, that the commission will actively pursue a single EUspanning cloud provider. Instead, it is seeking to simplify the processes by which data and computing requirements can move across the EUs increasingly fluid internal borders. The privacy and data territoriality regulations about which U.S. companies protest also act to hamper cross-border arrangements inside the EU, and the commission is keen to address this. At present, European cloud providers such as London-headquartered Lunacloud find it necessary to open data centers in individual EU member states, in part to comply with additional local legislation.

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European concerns with international cloud providers


Few would be surprised that Europeans biggest cloud concerns today are around data privacy, data security, and legal issues related to international and especially U.S. cloud providers. But there are various other concerns that international cloud providers have to address when dealing with European customers. While trust is closely associated with the privacy and security of data, it is also about dependency and loss of control. This is not a uniquely European issue, but decision makers cite this as a top concern. In each country its always easy to find executives of government ministers who assert that the data will remain in their country. For example, the Czechs prefer to save data in Austria instead of Germany. Spanish and French customers largely expect data centers to remain within their own borders. In short, customers want to know where their data resides and what happens to it. In addition, cloud offerings from the major players are critically considered because they are liable to American law even with European data centers. The Dutch are more relaxed and even permit the use of international cloud services for financial data. Service-level agreements (SLAs) cause additional issues. The one-size-fits-all concept may work in the U.S., but European companies appear more inclined to negotiate and customize contracts to their individual requirements. Support and localization further complicate matters, especially in nonAnglophone countries. Most U.S. providers attempt to conquer the European market by starting with Ireland and the U.K. but fail to adequately address the European Unions other 22 official languages. In France French-language support is a legal requirement, and the Germans would also like support in their mother language. International cloud providers should expect a cultural challenge in entering the European market. Compared to the North American market, Europeans are more skeptical about embracing new products and ways of working. This leads to longer evaluation phases and maintaining the status quo for a longer time frame. In addition, the European market works differently from the U.S. market. This is what European vendors have painfully started learning overseas. Furthermore it is much better to have an understanding of the business of the European customer. Most enterprises have concerns that the cloud provider underestimates the complexity of the existing legacy ICT environment and fear a failure of migration. Therefore it is necessary to build and maintain strong working relationships.

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The rationale for regional or national clouds


In a continent with many languages and in which long-distance connectivity can vary, there are valid reasons to consider focusing cloud services on individual countries or small clusters of culturally similar countries. Germany and Austria, for example, have a shared legal tradition and a common language. Portugal and Spain share more similarities than differences. Sweden, Norway, Denmark, and parts of southwestern Finland share a common outlook, as do the small Baltic states of Latvia and Estonia. Northern France, Belgium, the Netherlands, and Luxembourg also have much in common. Despite the ongoing harmonization efforts of the European Commission, the legal and cultural foundations on which different parts of Europe emerged remain just below the surface. It is often simpler to work within these foundations rather than to take on the additional difficulties and expenses of cutting across traditional regional borders. In Europe, as elsewhere in the world, local cloud providers have emerged. Few, if any, actively seek to exclude customers from afar. However, these providers do tend to favor their own country or their own region of historically aligned countries. U.K.-based companies such as West Yorkshires Brightbox or East Yorkshires GoCloud serve an audience that is predominantly U.K.-based. The theory of an EU-wide addressable market of 500 million potential customers does not always make sense in reality.

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Europes cloud providers


The major international cloud infrastructure providers such as AWS, Rackspace, Google, and Microsoft all have data centers or subsidiaries operating in Europe. The continent is also home to a growing group of local providers. While it would not be practical to discuss all of them here, we have selected a small sample to illustrate the different ways in which companies are emerging locally to meet a perceived market demand.

The state of Europes homegrown cloud market This PDF prepared for: Marieta Oviedo Alfaro (moviedo@ice.go.cr)

ProfitBricks
Founded in 2010 by former 1&1 board directors Andreas Gauger and Joachim Weiss, ProfitBricks serves the German, European, and U.S. markets with a granular Infrastructure as a Service (IaaS) offering. Portfolio ProfitBricks Berlin-based public cloud offers typical IaaS resources like compute and storage. Virtual machines (VMs) can be purchased from 1 core to 48 cores and in each case be flexibly combined with 1 GB to 196 GB of RAM and storage up to 5 TB. In addition the VMs can be extended with a live verticalscaling capability, which allows the addition of more cores and RAM to a VM while running. The cloud infrastructure is backed by an InfiniBand network with up to 80 GB of transmission speed. ProfitBricks supports the API-based management of resources, as well as offering a web-based management console. A 24-hour support line staffed by native German- and English-speaking staff rounds out the portfolio. Strategy ProfitBricks main target markets are Germany and the rest of Europe. Most activities are in Germany, and 20 percent of the activities come from other European countries like Sweden, the Netherlands, Austria, or Finland. The U.S. market is served from a data center in Las Vegas. Target customers are mainly web agencies for SaaS offerings, systems houses, and small web-hosting firms interested in managed services, startups hosting their web applications, and individual developers in need of a basic IaaS product. ProfitBricks intends to increase its data center footprint in both Europe and the U.S. In addition, more and more developer features will be added to ProfitBricks cloud offering, improving the API to support REST, a compatibility layer for Amazon Web Services, Rackspace, and others as well as deployment tools like Puppet Labs (see disclosure) and Chef and services for big data. (Disclosure: Puppet Labs is backed by True, a venture capital firm that is an investor in the parent company of GigaOM. Om Malik, the founder of GigaOM, is also a venture partner at True.) Analysis ProfitBricks is one of the few native IaaS providers in Europe and the only one from Germany. Like Switzerlands CloudSigma, ProfitBricks emphasizes a granular and flexible portfolio with regard to resource selection and pricing. The company makes much of its live vertical-scaling capability, and it

The state of Europes homegrown cloud market This PDF prepared for: Marieta Oviedo Alfaro (moviedo@ice.go.cr)

markets its web UI as a way for less-technical customers to deploy large numbers of machines relatively easily. However, it lacks a service portfolio around the infrastructure for developers interested in building applications on it. If ProfitBricks added more developer-related services like caching services, messaging frameworks, and support for various programming languages, it would be a more formidable competitor to Amazon Web Services in Europe. Nevertheless, ProfitBricks did catch up with its performance compared to AWS and Rackspace and its granular configuration options, and it recently raised a question regarding true cloud pricing to attack Amazon Web Services. It is exciting to see how ProfitBricks will progress in the future.

T-Systems
T-Systems, a subsidiary of Deutsche Telekom, is a global provider of ICT services. Although the company has traditionally concerned itself with managing IT for large enterprise customers, it is increasingly offering cloud-based services to SMEs in Germany and beyond. Portfolio Despite the general perception, T-Systems has no public cloud offering. Basically, the company offers all of its customers a hosted private cloud. This means that enterprises will be connected either via a dedicated network line or an ordinary internet connection with a T-Systems data center and will access the hosted private cloud or virtual private cloud over it. For this purpose different solutions are physically isolated from one another in blocks, in order to increase security. The infrastructure offerings are divided into four blocks: three fixed plans with preconfigured virtual server (VM) configurations and one single plan that allows for VM customization. In addition, T-Systems is offering professional services to help customers integrate their existing or new systems and applications with the cloud. Strategy T-Systems is a European provider, but it operates 90 data centers worldwide, 2 of these as dedicated VMware vCloud data centers in Austria and Germany. A further one is planned for Spain. Results from TSystems own research suggests that the cloud market in Germany and Austria is developing more slowly than anticipated. Perhaps surprisingly, its analysis identifies struggling Spain and Portugal as potentially high-growth markets. It seems that the current weak economies of both countries are encouraging companies based there to rent a bit of cloud instead of buying a long-term commitment to new hardware.

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T-Systems core cloud offering is generic, but the company also offers special industry cloud solutions in areas such as automotive, logistics and transportation, energy, public sector, or aerospace. Analysis T-Systems is one of Europes big cloud computing players. Historically it served only large customers, but the cloud is seen as an opportunity to gradually broaden its addressable market toward SMEs. TSystems plays to European sensitivities around data security and privacy, offering physically isolated infrastructure resources and value-added services on top of its hosted private cloud offering. A further asset is its ability to provide end-to-end cloud services, as it is one of the few European cloud providers that owns data lines through its parent corporation, Deutsche Telekom. This means it can offer hybrid cloud scenarios, which is an advantage over providers like Amazon Web Services, Microsoft, Rackspace, or Google in the enterprise market. However, one question remains: Why are only corporate customers served? Europe still has no equivalent to Amazon Web Services or Google. There is an opportunity for TSystems and others to catch up here, gaining more market share by serving small enterprises but also startups and developers with cost-competitive public cloud resources.

DomainFactory
DomainFactory is a web-hosting firm. Its JiffyBox IaaS service has been available for the past three years. Based in Munich, the company targets the German-speaking market in Germany and Austria. Portfolio JiffyBox was one of the first true IaaS solutions on the German market. The public cloud offering is made up of five plans, each with a different virtual machine configuration. JiffyBox offers Linux-based virtual servers only, with full root access and the ability to freeze on demand. Strategy Main target customers are SMEs, startups, and freelancers. Most customers use JiffyBox for cloud hosting of scalable websites. Application hosting is a smaller part of the business today. DomainFactory sees locality as its home advantage. It has direct contact to the customer, understands the culture, and knows how to deal with the people. In that way the company is able to address its target groups more precisely. DomainFactory will continue its focus on infrastructure in the future, but the product is evolving through the addition of extra features such as monitoring and alerting. The target groups (SMEs) and target

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markets (Germany and Austria) also remain largely unchanged. DomainFactory sees its benefits to customers as offering legal certainty, native laws, and EU data protection rights. Analysis DomainFactory sees its strength as being a local company, staffed by native German speakers. Indeed, in times like these, that strategy could pay off. German customers in particular are more sensitive about data privacy and where their data is stored. Larger German providers such as GMX, T-Online, and WEB.DE are responding to similar sentiment, launching a Made in Germany email service for their customers.

City Cloud
City Network is a web-hosting firm based in Karlskrona, Sweden. City Cloud is its IaaS offering, and the company claims several thousand customers across Scandinavia. City Cloud is based on the Enomaly product (now part of Virtustream). Portfolio City Cloud offers typical infrastructure resources on fixed packages to choose from 1 core and 0.5 GB of RAM up to 16 cores and 128 GB of RAM. Each virtual machine comes with a system disc from 20 to 50 GB and an IPv4 address, which is charged separately. IPv6 addresses are free of charge. Also available through the service are preconfigured VM images to use with provisioned virtual machines. The catalog includes a variety of Linux distributions but also Windows and BSD. In addition, predefined images like a LAMP stack or a Ruby package for developers as well as monitoring, blog, CMS, and ecommerce images are available. City Cloud also offers full access to an API, which allows the automation of key tasks such as starting, stopping, or cloning new machines. Finally, its SLA includes a 100 percent uptime guarantee. Strategy Due to its significant knowledge about the market and advantages such as being able to be local in both support and language, City Networks current focus is in Scandinavia. It does, however, have an eye on other European countries. The company currently has 25,000 customers for shared hosting and 1,000 customers using the City Cloud service. The majority of its customers are SMEs, but it also caters to enterprise requirements and to

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individuals. City Network targets customers with up to 1,000 employees. City Network splits its expansion plans with data center locations across the world. This is to satisfy an ever-growing need to be local with the data as well as broaden the reach to further markets with low latency. But it must also enter markets with local employees and local support, starting with some of the major markets in Europe. In addition to supporting Scandinavian markets it is already supporting Poland, Spain, and the U.K., and it is attempting to reach out to Italy, Germany, and France over the next three years. Analysis City Cloud belongs to the typical infrastructure providers without any added value services around its infrastructure. Nevertheless it has a credible offering and partners with consulting firms, software developers, and system integrators to help customers use the cloud infrastructure at scale. Its large customer base should strengthen its financial position for securing its current cloud offering and for future expansion. Its customer base and technical underpinnings in the credible Enomaly software plus its ability to offer a professional service partner network and its predetermined European strategy make City Cloud a public cloud service to watch.

Colt
Colt has proclaimed itself Europes information-delivery platform for viral business information, offering enterprise IaaS cloud services for businesses of all sizes fully based on VMware technologies. Based in London, the company owns a 43,000-km-wide network spanning over 22 countries, including metropolitan area networks in 39 major European cities and 20 of its own data centers across Europe. Portfolio As the heart of the portfolio, the Colt information delivery platform is the basis for the core capabilities like infrastructure services as well as application delivery and management and services for end-user computing. All are embraced with customer self-service abilities and further services for ITIL and end-toend integration and SLAs. Colt has two cloud offerings. The Enterprise IaaS provides an IT infrastructure (e.g., managed and dedicated) virtual server, managed storage, and backup, provided on a pay-as-you-go basis, whether for a test-and-development or production environment. The Colt Enterprise Cloud is for businesses of all sizes and provides cloud services offered through VMware-certified service providers, fully built on VMware cloud infrastructure technology.

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Strategy Historically Colt has kept a strong focus on the financial industry, but it also serves media and entertainment, assurances, and the public sector. Key target markets are private cloud services, hybrid cloud services, outsourcing, and IT services. Moving forward Colt will focus on three main services: managed network services, managed IT services, and managed unified collaboration and communication services. The company sees its target customers in the European upper middle class. Customer business needs and Colts offering fit well together by providing more individual and flexible solutions to European requirements. Analysis Colt is one of Europes larger managed services providers, with its offering spanning a comprehensive network of data centers across Europe. A managed private cloud service offers customers explicit qualityof-service guarantees with end-to-end SLAs for business-critical applications. This approach goes a long way toward meeting the regulatory requirements of sectors such as financial services and health care. Colts portfolio ranges from the IT infrastructure over the provision of IT platforms to the IT workload deployment and individual support. In particular the VMware-based cloud infrastructure is valuable for the business customer, considering that a variety of enterprises have their own VMware installations to integrate with Colt cloud services in a hybrid cloud environment. With its historical and tight focus on the business customer, Colt cannot embrace other target customers to gain a higher market share. Therefore a tough strategy change is necessary. Nevertheless with its data center network across Europe and from a technology point of view, Colt has the potential to offer public cloud services similar to Amazon AWS.

CloudSigma
CloudSigma is one European IaaS provider that has successfully expanded from its Switzerland-based data center outside Zurich to the U.S. market, where it offers similar services out of its data center in Las Vegas. The companys original differentiator was highly granular customer control over the amount of CPU, memory, and storage it wished to specify. CloudSigma was also one of the first IaaS providers to offer faster solid-state drive (SSD) storage as an option, and its product portfolio is now entirely SSDbased. Portfolio

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CloudSigma offers customers a flexible means to specify, manage, and pay for the specific IT resources they require. Rather than making customers choose from a menu of preconfigured virtual machines, as AWS and most of its competitors do, CloudSigma customers are able to specify their exact requirements for computing power, RAM, storage, and network usage. Each may be specified by API or via sliders on a web-based console. Billing is by the month, with discounts of up to 25 percent for longer rentals. CloudSigma recently partnered with Equinix to expand its product, offering it in additional selected markets. Strategy In a company press release, CloudSigma COO Bernino Lind commented on plans to expand its presence in existing markets and address customer demand in areas including Brazil, the UAE, and across the Asia-Pacific region. From the outset, company executives have noted that their highly customizable infrastructure offering is best suited to customers with a clear understanding of what they need and want. Indeed, CEO Robert Jenkins has noted on more than one occasion that significant numbers of CloudSigma customers are switching from another (less flexible, presumably) cloud service rather than coming to CloudSigma first. The companys messaging continues to appeal to this more-knowledgeable market, and partnerships such as that with CERN on the Helix Nebula project deliberately seek to stretch the capabilities of current cloud infrastructure. Analysis The companys early lead on SSD is no longer the differentiator it once was, with much of the IaaS market now at least offering SSD storage as an option. CloudSigma did, however, take the refreshing stance of explicitly explaining how economies of scale and investment in more-efficient technologies directly contributed to price cuts in its product offering. The nature of the companys new partnership with Equinix makes it feasible to deploy CloudSigmas management software in relatively small numbers of physical racks within an Equinix data center, permitting a rollout to new markets in direct response to firm customer orders rather than on the back of risky up-front investment. As a result, CloudSigma may be able to address the broad set of new markets it claims to be targeting, an expansion that would be wholly infeasible if significant up-front investment and development were required.

GreenQloud

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Based in Iceland, GreenQloud relies on the islands geothermal and hydroelectric power grid to offer an IaaS product described as completely carbon neutral. Based on an optimized and extended version of the Apache CloudStack open-source cloud project, GreenQloud offers API compatibility with Amazons Compute (EC2) and Storage (S3) products. Good connectivity to Europe and North America allows GreenQloud to serve both markets from its two Icelandic data centers, playing to its twin strengths as a provider of green cloud computing and a relatively safe place to avoid unwarranted government snooping or data seizure. According to co-founder and chief global strategist Eirkur Hrafnsson, even medical data from a country as data-conscious as Germany is safely and routinely stored with GreenQloud. Portfolio GreenQloud offers two main IaaS products: the ComputeQloud cloud computing infrastructure and the StorageQloud data-hosting offering. Both claim compatibility with their Amazon equivalents (EC2 and S3, respectively), and they offer the elasticity and monthly billing cycles that cloud customers typically expect. ComputeQloud offers a set of standardized virtual machine instances, including Ubuntu, Debian, CentOS, Fedora, and Windows Server. These two core offerings were recently joined by a cloud-storage product called QloudSync, aimed toward small businesses. The proposition and user experience are familiar to anyone who has used Dropbox. The products differentiators are its green infrastructure and non-U.S. data hosting. Strategy The companys initial selling point was clearly the greenness of its data centers, but it has become apparent that being green is not enough on its own. Corporate buyers must also be persuaded that the companys products are technically capable, secure, sustainable, and price-competitive. They must also be persuaded that faraway Iceland can be reached with sufficiently low levels of latency to deliver the speeds they require. Satisfied customers are beginning to provide valid proof points in all of these areas, and a new cable directly connecting Iceland to New York should be operational next year to deliver even faster connectivity to the financial institutions of Manhattan. GreenQloud is adding features and products (most recently QloudSync) that broaden its addressable market. Analysis All too often, being green is simply a nice feature to have. Its something that a consumer may choose to pay a premium for, but the choice is far less easy for a business to make. The new QloudSync product is a valid consumer play, and it takes GreenQloud to a market in which its green cache may well be considered worth paying for. In the more mainstream IT business, it is more often the companys technical capabilities that will win it a customer.

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According to Hrafnsson, GreenQloud is seeing interest in its software from around the world, both from enterprises interested in running it in their own private clouds and from customers who would like to access it in a data center nearer their location than Reykjavik. How the company handles the twin challenges of expanding without burnishing those much-vaunted green credentials and supporting private installations of software that moves ever-further from the mainstream of CloudStack, OpenStack, and others will shape whether it remains a small but viable Icelandic concern or grows into something else.

Conclusion
The cloud-infrastructure landscape in Europe has emerged slowly compared to the scene in the U.S., but the picture is less bleak than it sometimes appears. Differences in culture, outlook, and economic makeup have seen more emphasis given to private cloud deployments within Europe than the big public clouds of Amazon and others that arose in the U.S. Startups and small businesses without established relationships with big European infrastructure providers such as T-Systems find themselves drawn to public services such as AWS, reducing the incentive for Europes infrastructure giants (typically telcos) to approach this market. That also broadens the divide between enterprise-facing private cloud offerings and consumer-, SME-, and startup-facing public clouds. Another important aspect, faced by more than just European providers, is the fact that many providers started as classical web hosts and have their core competencies with the setup, installation, running, and maintenance of hardware and software. Cloud computing means creating innovations and mapping these into services. Nevertheless, it is important for each cloud provider either European or American to have an understanding of each submarket within Europe and not to regard it as one big market. But this is not a specific issue of cloud computing. In addition, having direct contact with customers and knowing their certain requirements and needs is a key advantage for each provider, especially in Europe. The adoption of cloud computing continues to increase across Europe. Heightened concerns in the aftermath of Edward Snowdens ongoing series of leaks are predominantly directed toward cloud providers from overseas. There is evidence that some European players are seeking market advantage as a result (such as the German telcos pushing their nationally bounded email service). The challenge will be to convey the supposed advantages of European (or national) services without causing customers to become more cautious about adopting any cloud service. Despite estimates of the multibillion-dollar or multibillion-pound impact on the global cloud market, it seems more likely that the effects of Snowdens revelations will mostly be short-lived. The cloud market in Europe and overseas will survive, and it will continue to grow.

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Key takeaways
Despite the ongoing legislative efforts of the European Commission, there isnt really a unified European market for cloud providers to address today. Shared cultural and legal heritage continues to reinforce logical small groupings of countries: Portugal and Spain, Austria and Germany, Scandinavia, the Benelux, and so on. In many cases, these remain the most obvious markets to address, as they are bigger than a single country while remaining similar enough to logically address as a single unit. Data protection and user privacy remain significant concerns for many European citizens and legislators. European data protection legislation is being strengthened and further harmonized, and the Snowden revelations may serve to support the arguments of those seeking even tougher legislation than was previously intended (such as German premier Angela Merkel). International cloud providers operate in Europe, as they do overseas. Their offerings appeal particularly to multinationals with European operations and to startups trying to tackle a global market. The market opportunity for local and regional European providers is also strong, especially when they can directly tap into local sentiment and cultural norms.

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About the authors


About Rene Buest

Rene Buest is a principal analyst and senior advisor with New Age Disruption, covering cloud computing, business technology, and collaboration. For more than 16 years he has focused on the strategic use of information technology in businesses and the IT impact on our society as well as disruptive technologies. Buest is the author of numerous professional cloud computing and technology articles and is a speaker, moderator, and participant of experts rounds. On CloudUser.de he writes about topics from the fields of cloud computing, it infrastructures, technologies, management, and strategies. Buest is a fully qualified specialist for system integration and holds a diploma in computer engineering from the Hochschule Bremen (Dipl.-Informatiker [FH]) as well as a M.Sc. in IT-Management and Information Systems from the FHDW Paderborn.

About Paul Miller

Paul Miller is an analyst and consultant based in the East Yorkshire (U.K.) market town of Beverley and working with clients worldwide. He helps clients understand the opportunities (and pitfalls) around cloud computing, big data, and open data, as well as presents, podcasts and writes for a number of industry channels. His background includes public policy and standards roles, including several years in senior management at a U.K. software company and a Ph.D. in Archaeology. Miller was the curator for GigaOM Researchs infrastructure and cloud computing channel during 2011, routinely acts as a moderator for GigaOM Research webinars. He has authored a number of underwritten research papers such as this one.

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About GigaOM Research


GigaOM Research gives you insider access to expert industry insights on emerging markets. Focused on delivering highly relevant and timely research to the people who need it most, our analysis, reports, and original research come from the most respected voices in the industry. Whether youre beginning to learn about a new market or are an industry insider, GigaOM Research addresses the need for relevant, illuminating insights into the industrys most dynamic markets. Visit us at: pro.gigaom.com.

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