Slow Cloud Adoption In Europe

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Published on Wednesday, 06 June 2012 12:23
European privacy rules, multi-country business processes, euro crisis and a lingering recession will delay cloud computing adoption in Europe by at least two years when compared to United States, according to market analyst Gartner. Although interest in cloud computing is high in Europe, the diversity of Europe’s 44 different nations will result in slow cloud adoption in this region for some time.



These nations have different rules and regulations that has to be taken into consideration when it comes to cloud computing. "The opportunities for cloud computing value are valid all over the world and the same is true for some of the risks and costs," says Paolo Malinverno, vice president at Gartner.



"However, some of cloud computing’s potential risks and costs — namely security, transparency and integration — which are generally applicable worldwide, take on a different meaning in Europe,” explains Malinverno.

Four main inhibitors for cloud in Europe over the next few years:

1. Diverse (and Changing) Data Privacy Regulations


Moving personal data to the cloud, protecting it adequately and complying with privacy laws are problems that have been cloud inhibitors, but they can be solved.For example, companies in Europe are concerned about the U.S.

Patriot Act of 2001. It makes it undesirable or even illegal for them to use cloud service providers that are located or incorporated in the U.S. (where the majority of them are) — on the basis that U.S. entities may be able to look into their data.

The bottom line for European companies is that there are ways of using cloud more safely. While it is true that international regulations such as the Patriot Act will allow law enforcement authorities to access personal information hosted by third parties — in cases of terrorism or severe crime, or to protect national security.

2. Complex B2B Multi-enterprise Integration and Processes

Europe's diversity issues are compounded when it comes to running common and intrinsically multi-enterprise processes across different countries. Frequently, regulations and business practices in one country are incompatible or undesirable in another, because each country  extends its pre-existing legislation.



European B2B infrastructure providers have turned this complexity, and their ability to address it, into a business opportunity and a competitive advantage. In a fast growing new market such as cloud computing, diversity makes achieving the required critical mass more difficult and slows down the execution of players wanting to offer cloud services throughout Europe.

3. The Effects of Some EU Policies
The EU was established to promote economic and social progress and to achieve balanced and sustainable development, through the creation of a group of member states without internal barriers.



The EU goes about achieving this aim by setting policies and regulations which are subsequently worked into the legislation of each member state. The whole process can take considerable time, especially as each member state has the sovereign power to add local legislation to whatever policy or regulation is agreed at EU level.

4. The Investment Hold Caused by the Euro Crisis
The continuing economic crisis within the countries using the single European currency has deep IT implications, because increasing uncertainty about the euro is causing major investments to be put on hold.This is slowing down strategic and game changing decision making. This inhibitor might not weigh as much as the previous three, but it is certainly a factor worthy of consideration.

"The bottom line is that the interest in cloud is as high in Europe as it is elsewhere in the world" says David Mitchell Smith, vice president at Gartner. "While these inhibitors will certainly slow down cloud adoption in Europe, they will not stop it — the potential benefits of cloud are too attractive and the interest in its efficiency and agility are too strong to stall it for long."

------Gartner