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1. Boosting Efficiency and Quality in EU Public Services: The Need for a European Multi-Cloud-First Strategy

Author:
Matthias Bauer, Andrea Dugo, Dyuti Pandya, Vanika Sharma, and Elena Sito
Publication Date:
03-2025
Content Type:
Working Paper
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
EU governments have an unprecedented opportunity to unlock up to EUR 450 billion in annual fiscal savings by modernising public services through advanced multi-cloud solutions, cloud-based AI, and other deep tech innovations. As estimated in this study, this figure highlights the transformative impact of digitised government services – not only in improving service quality and operational efficiency but also in generating substantial fiscal gains that would enhance Europe’s economic competitiveness. Multi-cloud adoption is not merely an infrastructure choice but a strategic enabler of modern, agile, and citizen-focused public services. To fully capitalise on cloud adoption, EU governments should embrace a multi-cloud strategy that integrates different public cloud providers and, where necessary, also incorporates sovereign or private cloud environments. Cloud services come in many forms, including Infrastructure-as-a-Service (IaaS), Platform-as-a-Service (PaaS), and Software-as-a-Service (SaaS). Each model offers unique value propositions such as ease of use, rapid security updates, scalability, and the capacity to integrate novel technological features, such as AI applications, seamlessly.
Topic:
European Union, Digital Economy, and Cloud Computing
Political Geography:
Europe

2. The EU’s Trillion Dollar Gap in ICT and Cloud Computing Capacities: The Case for a New Approach to Cloud Policy

Author:
Matthias Bauer, Fredrik Erixon, and Dyuti Pandya
Publication Date:
05-2024
Content Type:
Working Paper
Institution:
European Centre for International Political Economy (ECIPE)
Abstract:
An inward-looking EU approach to cloud computing and data policies risks stifling innovation and competitiveness by promoting domestic champions at the expense of accessing global cloud capabilities. Limiting market diversity and access to best-in-breed solutions could hinder digital transformation across sectors, raising costs and constraining growth opportunities. By contrast, a free trade approach to cloud offer guardrails and security but champions non-discriminatory cross-border and regulatory policies, yielding economic advantages by stimulating investments, fostering innovation, and enhancing competition. Unfortunately, some EU policymakers envision Europe building an independent ICT infrastructure, exemplified by initiatives like the European Alliance on Industrial Data, Edge and Cloud. This approach prioritises technological sovereignty, aiming not just to maintain European control over critical infrastructure and data but favouring localisation policies, including in AI and quantum computing. However, the approach is simply not going to work because the amount of resources that are needed for “pure-EU firms” to rise up as significant competitors to global leaders is so large that it would drain other sectors of investments and human capital. The investment gap between the EU and the US in ICT and cloud-related sectors, totalling some USD 1.36 trillion, presents a significant challenge for native European companies. To catch up by 2030, 2040, and 2050, European technology companies would need to substantially increase annual investments, ranging from approximately USD 157 billion to USD 1.2 trillion annually, representing 0.8 percent to 6.4 percent of the EU’s GDP. This would – hypothetically – require a significant commitment of resources. Despite recent efforts such as state aid for R&D in cloud and edge computing, the scale of investment needed far exceeds the current levels, underscoring the urgency for an open and non-discriminatory EU policy approach to bolster Europe’s position in the rapidly growing and technologically changing digital landscape. There are different components to a successful cloud policy, including policies to spur adoption and cross-border cloud integration in the EU, and more investment in R&D. EU policymakers should adopt a dynamic perspective rather than fixating on static market shares, and pursue policies that prioritise innovation and technological advancement over merely seeking to catch up on current technologies. The cloud market and the broader Internet market are going through rapid changes, leading to new services and new competition. A future-oriented approach to cloud policy advocates for policies that foster competition, drive technological progress, and enable interoperability, all of which align with the dynamic nature of cloud services and global markets.
Topic:
Communications, European Union, Digital Economy, Cloud Computing, and Information Technology
Political Geography:
Europe