Geopolitical Shifts Drive Western European CIOs to Embrace Local Cloud Providers
Western European organizations are dramatically reassessing their cloud strategies, increasingly prioritizing local providers as geopolitical tensions reshape the technology landscape. A recent Gartner survey reveals that 61% of CIOs adn IT leaders in Western Europe plan to increase their reliance on local cloud providers [https://www.gartner.com/en/newsroom/press-releases/2023-11-21-gartner-forecasts-geopolitics-will-drive-61-percent-of-cios-and-information-technology-leaders-in-western-europe-to-increase-reliance-on-local-cloud-providers]. This marks a important departure from the longstanding reliance on large, primarily US-based, cloud giants and signals a broader move towards digital sovereignty.
The shift isn’t simply about data protection anymore; it’s about reducing dependence on foreign technology across the entire IT stack – from semiconductors and software to artificial intelligence. This strategic realignment, according to Gartner VP Analyst Nader Henein, will be a complex, costly, and multi-generational undertaking.
The Evolution of Digital Sovereignty
For years, “digital sovereignty” was largely synonymous with “data residency” – the requirement that data be stored within a specific geographic region to comply with regulations like the General Data Protection Regulation (GDPR) in Europe. While data residency remains crucial, the current geopolitical climate has broadened the definition considerably.
The escalating tensions between major global powers, coupled with concerns about potential supply chain disruptions and foreign influence, have highlighted the risks of over-reliance on a limited number of technology providers. This has lead to a growing recognition that true digital sovereignty requires control not just over where data is stored, but also how it’s processed, by whom, and with what technologies.
“The subject of sovereignty used to be dominated by data residency because the main driver was data protection,” explains Henein. “Due to geopolitical tensions, the driver has shifted to reducing foreign digital dependency across the entire technology stack.”
Why the Sudden Shift? A Convergence of Factors
Several key factors are converging to accelerate this trend:
* Geopolitical Instability: The war in Ukraine, rising tensions in the South China Sea, and broader concerns about international relations have underscored the vulnerability of relying on technology infrastructure controlled by potentially adversarial nations.
* Supply Chain Resilience: The COVID-19 pandemic exposed the fragility of global supply chains, prompting organizations to seek greater control over critical technology components, including cloud services.
* Data Privacy Concerns: While GDPR addressed data privacy, concerns remain about access to data by foreign governments and the potential for surveillance.
* European Strategic Autonomy: The European Union has been actively promoting “strategic autonomy” – the ability to act independently in key areas, including technology – to reduce its dependence on external powers. The EU’s Digital Decade policy,such as,sets ambitious targets for digital skills,infrastructure,and sovereignty [https://digital-strategy.ec.europa.eu/en/policies/digital-decade].
* Growing Capabilities of Local Providers: European cloud providers are rapidly maturing,offering increasingly competitive services and addressing concerns about scalability and innovation.
The Scope of the Redesign: Beyond the Cloud
The implications of this shift extend far beyond simply switching cloud providers. CIOs are now facing the daunting task of re-evaluating their entire technology stack. This includes:
* Semiconductors: Reducing reliance on Asian semiconductor manufacturers is a key priority, with initiatives to boost domestic chip production in Europe, such as the European Chips Act [https://digital-strategy.ec.europa.eu/en/policies/european-chips-act].
* Software: Exploring and adopting open-source software and European-developed software alternatives to reduce dependence on US-dominated software markets.
* Artificial Intelligence: Developing and deploying AI models and infrastructure within Europe to ensure data privacy and control over critical AI technologies.
* Cloud Infrastructure: Prioritizing cloud providers with data centers and operations located within Europe,and adhering to European data protection standards.
This complete redesign represents a essential shift in strategy, requiring significant investment, expertise, and long-term planning. As henein points out, “It’s not going to be easy, it’s not going to be cheap, and it’s going to span multiple generations of CIOs.”
The Rise of European Cloud Providers
Several European cloud providers are well-positioned to benefit from this trend:
* OVHcloud (France): A leading European cloud provider offering a wide range of services, including bare metal servers, virtual machines, and cloud storage. OVHcloud emphasizes data sovereignty and transparency [https://www.ovhcloud.com/en/].
* Scaleway (France): Focuses on providing enduring and affordable cloud solutions,with a strong emphasis on innovation and open-source technologies [https://www.scaleway.com/en/].
* Deutsche Telekom (germany): Offers a secure and sovereign cloud platform tailored to the needs
