In projects such as autonomous driving, an enormous amount of data has to be processed in real time. This requires a new infrastructure.
(Photo: obs)
The cloud is crucial for the digital future, and there is consensus in business and politics. The Internet-based provision of storage space, computing power and software is a mandatory requirement for many future technologies, whether autonomous driving, Industry 4.0 or modern healthcare.
But Europe’s technological future is not in your hands. The widespread cloud infrastructures come from the US companies Microsoft, Amazon and Google. This does not go together with the European goal of technological sovereignty. In addition, data processing across EU national borders is difficult without a uniform infrastructure.
The EU Commission and the German government want to change that. “Our economy must be able to decide for itself how it stores, uses and processes its data,” Economics Minister Robert Habeck (Greens) told the Handelsblatt.
The problem: setting up your own cloud infrastructure requires high investments. The economy does not feel capable of standing up to the US competition on its own.
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That is why the state is now stepping in: Former Chancellor Angela Merkel (CDU) and French President Emmanuel Macron had already planned to create an “Important Project of Common European Interest” (IPCEI) for the cloud market. Habeck wants to build on this.
Important part of Habeck’s industrial policy agenda
With an IPCEI, the EU Commission and member states can identify economic sectors of overriding interest that should receive special state support. This industrial policy measure enables significantly more financial support from the state than current law would allow.
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The Ministry of Economics has now reported projects from 26 companies to the EU Commission, which the federal government wants to support with up to 750 million euros, according to a statement available to the Handelsblatt. In addition to building an infrastructure that works across national borders, the projects are about climate-neutral operation and cloud security. “German companies will play a central role in ensuring that data is processed more securely and energy-efficiently and that innovative technologies and applications are created,” said Habeck. With the European cloud, the “foundation for the digital sovereignty and competitiveness of the EU” is being built.
“German companies will play a key role in ensuring that data is processed more securely and energy-efficiently and that innovative technologies and applications are created.”
(Photo: Reuters)
For Habeck, the cloud plan is an important part of his industrial policy agenda, even if the preliminary work was done by his predecessor Peter Altmaier (CDU). The green Vice-Chancellor made his request clear early on: In his view, the age of turbo-globalization has long since passed, and dependencies on other countries have become too great.
Sovereignty and resilience are the new buzzwords in energy, in supply chains – and also in digitization. And Habeck does not shy away from intervening in the economy on a large scale with the state treasury.
Later start than planned
In addition to Germany and France, ten other EU countries are involved in the cloud strategy. The projects from all countries together have a volume of 5.2 billion euros. It is now up to Brussels to approve the plans and thus the money. The infrastructure project ties in with the European project Gaia-X, which is intended to produce certain cloud applications.
According to the current status, the projects should start in autumn. Originally the summer was planned. According to the Federal Ministry of Economics, the reason for the delay is that the EU Commission has made new requirements that should have been incorporated.
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Business is urging the new cloud strategy timeline to be strictly adhered to. “Success will depend above all on one factor: speed,” says Achim Berg, President of the digital association Bitkom. A quick start and legal certainty are needed for companies.
It is questionable whether the industrial policy strategy can have the hoped-for effect on the cloud market. Amazon, Google and Microsoft alone share two-thirds of the cloud market. New players pushing onto the market come mainly from China of all places.
According to a forecast by industry analysts from Gartner, global cloud business revenue will be around €350 billion in 2022. Can a low single-digit billion amount be enough to make Europe competitive?
In any case, the economy is immediately reporting further needs. The first tranche of the state is helpful, says Iris Plöger, member of the management board at the Federation of German Industries (BDI). “In addition, however, further support from the EU is required,” says Plöger. That would be possible: An IPCEI can consist of several rounds.
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