The story is a familiar one. American organisations have often been early adopters of advanced technologies, while their European peers lagged. Cloud computing is no different. US organisations have outspent their EU counterparts for many years. A Gartner market analysis from 2019 showed the US clearly out in front, with countries across the Atlantic relegated to the “tracking” or “laggard” groups. However, things have rapidly changed over the last few years. Written by By Paul Mackay (pictured) , Vice President Cloud – EMEA & APAC, Cloudera
Cloudera research reveals that 92% of EMEA organisations are planning to move more data to the public cloud over the next three years. As the old world catches up with the new, innovative data management platforms like Cloudera’s will accelerate the process – enabling organisations to extract value from their data wherever it resides.
Out of the blocks
Cloud has become the foundation for the digital transformation projects that drive customer engagement, business agility and competitive advantage across virtually every industry. Given the role cloud plays in driving this value, early adoption has undoubtedly given US organisations an advantage over the years.
Why did the US jump out of the starting blocks so quickly on cloud? Most obviously, because all the main hyperscalers are American companies. It follows that they sold locally and gained deeper market penetration at home first, before expanding abroad. Amazon Web Services (AWS) launched its pioneering S3 cloud storage service in the US in 2006, four years before it made landfall in Europe.
The likes of AWS, Microsoft Azure and Google Cloud Platform were also blessed with a large domestic market in which to grow. Data sovereignty concerns weren’t an issue at the time, as cloud datacentres were located in the same jurisdiction as customers’ corporate headquarters. Contrast that with Europe, where legal concerns over transatlantic data transfers persist to this day. As a result, US organisations had a significant head start on cloud.
Why is Europe catching up?
However, over the past few years, there’s been a shift. New data reveals that 45% of European organisations bought cloud services in 2023 – up four percentage points annually – compared to 48% in the US. But why?
As cloud adoption slowed and the market reached something close to saturation in the US, the hyperscalers launched European business units that have grown rapidly. And they have been able to satisfy local and regional governments over security and sovereignty concerns. AWS last year announced a European Sovereign Cloud, which should help allay long-running fears over data transfers and access by US government intelligence/law enforcement agencies. The European Commission now wants 75% of regional organisations to use “cloud-edge” technologies by 2030.
The European market is also benefitting from a kind of “second-mover” improvement in performance. Cloud technologies have matured, providers are offering price reductions and optimised products, and roadblocks to adoption have now eased. In this context, there’s actually a lot to be said for not adopting new technology first. You can learn from the mistakes of those that were quickly out of the blocks and benefit from additional tools that enable you to drive full value from innovations like cloud.
This is where the likes of Cloudera have stepped up to address key customer pain points, breaking down silos and ensuring strict governance. In truth, few organisations go all-in on the public cloud. Although there are significant cost, agility and scalability benefits from migrating workloads to the public cloud, some data may need to remain on-premises or in private clouds for reasons such as compliance – especially in heavily regulated industries such as banking. That’s why 68% of organisations store data in a hybrid environment according to our research. A further 72% have a multi-cloud model, meaning that they work with two or more hyperscalers. This complexity can quickly erode any value organisations gain from moving to the cloud in the first place.
Cloudera Data Platform enables seamless management of data, regardless of whether it sits on-premise or in the cloud. It means organisations can finally start to capitalise on all those business benefits of cloud migration, whilst applying company-wide policies to keep governance, risk and compliance (GRC) teams happy. Platforms like Cloudera have made cloud a much more viable, profitable proposition for European organisations.
The race is on
The future of business is undoubtedly digital, and therefore built on cloud computing – whether that means traditional centralised data centres or more dispersed edge computing locations. US businesses arguably still have an advantage having moved so quickly on cloud. But Europe is undoubtedly making up ground.
When it comes to the cloud market, it’s the perfect time for organisations in Europe to peak, with innovations from AI, quantum computing and the Internet of Things (IoT) to biotech and cleantech all primed to dominate the business landscape. But their ability to harness the transformative potential in these technologies will depend on how seamlessly they can manage data across their hybrid cloud environments.
