Unleashing the Potential of Cloud Computing in Europe, A Dell Perspective

The European Commission recently issued a policy paper outlining how it wants to take forward cloud computing in Europe. This is in response to the barriers in legal jurisdictions, security and data privacy, trust, and data access and portability. IDC analyst David Bradshaw stated, in his May 2012 Brussels cloud workshop, that Europe is 3-5 years behind the USA. While both geographies share similar service providers and cloud offerings, it is likely ambiguity and nationalist policies that delay the full innovation, revenue and employment potential.

The paper contains three main areas of action – cutting through the jungle of standards, dealing with contracts, and the formation of a European Cloud Partnership (ECP) backed up with €10 million in funding. The first two actions relate to issues that users have highlighted as problems during public consultations on cloud computing. The ECP is the Commission’s response to these issues. Clearly cloud is in its adolescent stages but businesses and governments recognize its transformative capabilities in addition to its potential to cut costs. The Commission hopes that its work will provide European organizations with the confidence to pursue cloud and will boost to IT services and solutions, which will ultimately help create jobs and growth. Given the continuing economic crisis in Europe, cloud can go a long way to helping governments save money on their IT infrastructure and driving growth.

The Commission believes that complex policies or protectionist legislation impede adoption of cloud computing and, in turn, limit the availability of new products and services to consumers. Dell supports a European cloud policy as go-it-alone policies at national levels prohibit savings, scale, and innovation that many companies demand. Instead, the free flow of information, the rapid deployment of new services, and the wealth additional compute power offer by cloud puts small businesses on par with larger competitors. By extension, it lowers costs to consumers and taxpayers; it improves quality of public services to citizens; it creates a wider market for, and portfolio of, applications than ever thought possible under traditional infrastructures. The European Commission states that it believes Clearing the ‘path to cloud’, as, of legal impediments or ambiguitity improves the likelihood of an increase in GDP of €857 billion and the creation of 3.8million jobs (by 2020).

Commission areas where actions are needed: {excerpt}

1.  Fragmentation of the EU’s digital single market due to differing national legal frameworks and uncertainties over applicable law, digital content and data location ranked highest among concerns of potential cloud computing adopters and providers.

Dell Response: Dell serves a global clientele, yet, like many businesses, we cannot effectively place resources (personnel or cloud capacity) in each and every market. Furthermore, small businesses responding to the increased mobility or demands of global consumers require easy and efficient access into outside markets. If that requires use of a single data center to serve customers in multiple countries, there should be consistent laws, data transfers, contracts, and policies. We support the implementation of common policies and protocols to encourage movement of data to promote equal access to innovation, compute savings, and new cloud services.

Cloud was intended to abstract the business from physical hardware, yet forcing a business to navigate permutations of laws based upon physical location of hardware or data is contradictory. Localized legal frameworks limit choice for entrepreneurs, governments, and its citizens.

2.  Problems with contracts were related to worries over data access and portability, change control, and ownership of data.

Dell Perspective: Cloud can promote change and disruption to long-held processes or structures but it should not hold organizations captive. Cloud is a key, not a lock to business. Providers with closed contracts, applications, data, or clouds that prohibit exchange or portability are unacceptable. We change ISPs, telecom providers, and utilities with relative ease.

There are providers of legacy infrastructure or software locking-in clients to sustain their own maintenance revenue on outdated and inefficient offerings. According to IT analyst IDC, in 2012, 80% of net new applications will be available via the cloud. This rise of new applications, application providers, and low- barrier to entry brings greater choice to business and productivity to users. Should a cloud vendor fail to meet performance metrics, businesses deserve the right to move data and services to another vendor, regardless of EU country. Dell has specifically acquired companies and their technologies that enable data portability between public and private clouds.

3.  A jungle of standard generates confusion by, on one hand, a proliferation of standards and on the other hand a lack of certainly as to which standards provide adequate levers of interoperability of data formats to permit portability….

Dell Perspective: Dell believes standards promote trust and visibility for our clients and their industry. Standards that are onerous or prohibit competition increase costs for clients. Additional cloud standards should augment or complement what has already been implemented such as PCI. We support the criteria for security of data, physical facilities and protection of personal data with clearly defined penalties for non-compliance. We encourage governments to become part of, and work with, the many industry bodies in existence today to strengthen existing standards, not more incremental certifications.

Additionally, standards imposed at national-levels only serve to drive up costs, limit competition, and eliminate client choice or interoperability. Dell also believes in an open approach to cloud provides the most choice for customers. For example, Open APIs that allow for innovation, collaboration, and reduced risk of vendor lock-in. We’ve put our resources behind initiatives such as OpenStack, OpenCompute, Ubuntu, and Hadoop for the easier customization and lower dependencies. Carlo Daffara, a researcher in the field of IT economics, claims the European economy is benefiting by EUR450 billion per year from its use of open source.

In additional to what is stated above, we would support the Commission in the creation of clauses or guidelines related to exit strategies and longevity of suppliers. Todays’ businesses are placing their most critical systems in the cloud, such as Software as a Service (SaaS) for human resources, online order processing, payroll, or general ledger. These applications are the lifeblood of todays’ SMBs. The small and midsize organization, which comprises over 97% of all businesses, have placed big bets with cloud computing to stay competitive or meet costly government or industry mandates.

Michael Dell, our CEO and Founder, has stated that, “Cloud is not a destination or singular path, but a transformation ….” For this transformation, cloud must be seen as part of a business strategy, not a technology. A business strategy is fluid and evolving to reflect influences of markets and customer demands. Therefore, cloud will continually mature and the EU Commission will be most successful by removing obstacles while keeping transformation potential intact.

About the Author: Matthew Mikell