In brief: With most hyperscale cloud companies being headquartered in the US and China, the European Union is looking to set up a cloud ecosystem of its own to ensure that it has complete control over data flowing across its member countries.
The EU has a plan to challenge the dominance of American and Chinese companies in the cloud sector with a project dubbed Gaia-X. Currently, the Infrastructure as a Service (IaaS) market is mostly split between Amazon (47.8 percent), Microsoft (15.5 percent), Google (four percent), IBM (1.8 percent), Alibaba (7.7 percent) and Tencent, but the European bloc wants to create a new ecosystem that will reduce its dependence on these companies.
Gaia-X is the result of a collaboration between the European Commission and the German and French governments, who have committed to support the project in taking off. According to Germany's Federal Ministry for Economic Affairs and Energy, it will require the concerted efforts of over 100 organizations including Deutsche Bank, Siemens, Bosch, Telekom, and SAP.
The initial announcement last year caused a stir among US tech giants who warned that Europe's ambitions for "digital sovereignty," while a legitimate goal, have the potential to stifle innovation and restrict the freedom of choice for potential clients. American companies like Microsoft have even offered to help with Gaia-X, but it's not clear how they could in the context of having to comply with the US Cloud Act, which is one of the reasons why Europe wants to take control of its data flow.
That said, Gaia-X is still in its infancy, having just been registered as a company by a group of French and German companies. The official launch is slated for 2021, and details surrounding the project have yet to be revealed. The closest description so far is that Gaia-X will be made up of a swarm of small and large cloud companies that will have to comply with a specific set of security, privacy, and data governance and portability rules.
According to Gartner, worldwide spending on public cloud services is set to reach $266 billion this year, which shows that cloud computing is going mainstream and established players have already secured a strong foothold. This casts some doubt on the EU's ability to build an alternative cloud ecosystem, but some companies like French IaaS provider OVHcloud are confident it can be done.