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EU Seeks Joint National Cloud-Computing Purchases for Growth

The European Commission aims to support the region’s cloud-computing industry by encouraging governments to jointly buy software and computing resources on the Web, Digital Affairs Commissioner Neelie Kroes said.

The 27-member bloc’s executive arm set up a working group, dubbed the European Cloud Partnership, with initial funding of 10 million euros ($13 million), Kroes said today in a speech in Davos, Switzerland. The group of officials, cloud buyers and suppliers should work on developing common standards and security requirements across the region to enable concerted purchases, according to Kroes.

The global market for cloud services, or on-demand computing resources such as data storage and software applications via the Web, may grow to $241 billion by 2020 from $40.7 billion in 2011, according to Forrester Research Inc. Divergent rules on matters such as data protection make it harder for companies such as International Business Machines Corp. (IBM) and Atos SA (ATOS) to approach customers in a standardized way.

“We need to act to support speedy uptake of cloud computing in Europe,” Kroes said. “The cloud market will grow, bringing opportunities for existing suppliers and new entrants. And cloud buyers, including the public sector, will buy more with less and become more efficient.”

Microsoft

Kroes said she expects the project to start this year and begin to show results in 2013. The partnership is “not about building a European super-cloud” and will not force the combination of existing infrastructures, she said, adding that private businesses may follow the logic of the partnership.

“We welcome this and will continue to collaborate with the EU to make the industry, governments and private people more secure and more comfortable in adopting cross-border cloud computing services,” John Vassallo, Microsoft’s head of EU affairs, said in a telephone interview, adding that his company is already part of the working group “Those are the ones that create the scale that enables economic benefit.”

The commission presented a proposal yesterday for overhauling the EU’s 17-year-old data-protection policies. The plan includes fines of as much of 2 percent of annual global sales for companies mishandling or losing personal data, as well as a requirement to report serious data breaches within 24 hours.

Vassallo said it is “almost impossible” to notify customers and authorities within 24 hours of a data loss because affected host companies usually don’t find out about such losses immediately. Proposed rules which would force companies to ask Internet users for explicit consent every time they want to store personal data would create a “disturbing” user experience, he said.

“There is a willingness in the proposal to achieve balance, but what we’d like is openness to debate,” Vassallo said.

To contact the reporter on this story: Cornelius Rahn in Frankfurt at crahn2@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net

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