Dusseldorf The conference was supposed to be a signal of departure – but even before it started, background noises could be heard. In November, Gaia-X, the organization behind the cloud project of the same name, hosted a virtual summit. The motto: “Here to deliver!” Shortly beforehand, however, a founding member, Scaleway, announced the withdrawal. The French cloud provider justified this with the participation of US companies such as Amazon, Google and Microsoft.
Once again it is clear: The ambitions of Gaia-X are great, but the members cannot even agree on fundamental questions. What the project has mainly delivered so far is controversy.
Does Gaia-X run out before it starts properly? Such headlines annoy Francesco Bonfiglio, the head of the non-commercial organization that is based in Brussels, which is typical for Europe.
The construction of the project took time, he told the Handelsblatt. The first services will be available in 2022, and in 2023 the project will reach “critical mass”. The goal is for every cloud service provider to support the standard. The consortium wants to create a basis for a “European data infrastructure”, for an “open digital ecosystem” in which companies “can bring together, trustfully share and use data”.
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In order for this to work, the consortium defines standards, for example for data exchange. And it is developing several services that facilitate the networking of various products and platforms, such as an identification service, data protection mechanisms and a catalog with the available offers.
In the cloud market, it is not the origin of the dominant providers that is the problem, but the concentration of power in the hands of a few, says Bonfiglio. “Europe lacks critical mass and visibility.” Gaia-X ensures transparency, control and interoperability – and thus helps smaller companies.
The hope: if technology providers link their digital services with one another, they can offer an alternative to the cloud companies Amazon Web Services, Microsoft and Google. And if user companies can transfer the data from one service to another via standardized interfaces, the so-called lock-in effect does not apply. This describes the phenomenon that users stay with only one provider because the hurdles to switch are too high.
“Large and bureaucratic structure”
The reality is likely to have a sobering effect on outsiders. Two years after the announcement, Gaia-X is little more than a theoretical construct. The development of the services for networking different platforms, called Federated Services in project jargon, will only begin in these weeks under the leadership of the Association of the Internet Industry Eco.
There are also no specific products based on the standards, apart from a few state-funded flagship projects. One consortium wants to set up a platform for marine data, while another wants to facilitate the exchange of information in the healthcare sector. Another group is working on large language models that have so far only been developed by companies in the USA and China.
“After two years, Gaia-X is basically a large and bureaucratic structure,” criticizes Paul McKay, an analyst at Forrester. That slows down the development of products considerably. The market observer therefore warns: “IT managers will not switch to any Gaia-X offerings until they are offered the functions they need.”
Gaia-X boss Bonfiglio, who has been in office since March, does not want to see any delay. First of all, it was a matter of building up the organization and clarifying the internal processes – after all, the consortium had grown from 22 to more than 300 members. In addition, one had to write a uniform product plan for the many projects that Gaia-X summarizes.
“2022 is the year in which the first initiatives come onto the market,” promises the manager, who previously worked at Hewlett Packard and Unisys, among others. In 2023, the technical framework with the services and infrastructure will be completely ready. The Italian hopes that the member companies will then develop products on this basis and create a pull.
However, that is a lot of time, especially in a market that is developing so quickly. Expenditures for cloud services are growing strongly, the market researcher Gartner expects an increase of 22 percent to 482 billion dollars for the coming year. The pandemic is a catalyst for digitization and thus also for the introduction of cloud services, according to a report.
“Don’t draw a moat around Europe”
That begs the question: is Gaia-X too slow? Bonfiglio is unconcerned: “If this were a single company project, we’d probably be faster,” he says. Within Gaia-X, however, there was a need for fundamental debates and consensus building – that was very important, but it also takes time.
A particular challenge was to convert abstract concepts such as sovereignty and transparency into concrete technology, explains Bonfiglio. The expectations in this regard were very high at the beginning and at the same time not clearly defined. There is now more clarity that the principles can now be mapped technically.
In the projects that are based on Gaia-X technology, the manager believes that the speed will be significantly higher anyway: unlike in the non-profit organization, the companies do not have to take 300 other members into account.
As a positive example, he cites Catena-X, the merger of the German automotive industry with technology companies such as SAP and Telekom, which aims to digitally map the industry’s value chain.
Bonfiglio also emphasizes that companies can retrospectively make existing services compatible with Gaia-X. A new development is not necessary. His hope: Providers who adhere to the standards of the project gain in competitiveness – and thus put the rest of them under pressure.
A point of contention is and will remain the participation of companies outside Europe, as the headlines before the Gaia-X summit showed. Bonfiglio thinks the discussion is superfluous. You cannot draw a moat around Europe, he argues. “Anyone who believes that we can only work with European data is ignoring the essence of the digital economy.”
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