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An international battle is brewing over cloud computing

by Scott Priest, Editorial Director

January 19, 2012

Cloud computing continues to emerge as this decade's major technological driver, and it's now becoming a diplomatic issue. Yesterday Bloomberg Businessweek reported that European countries are banding together effectively against US companies, so their cloud providers don't fall behind the way they did in areas such as mobility and search.

At first it might seem like an odd fight to pick. But Europe has its reasons. US law requires cloud-stored data owned by American companies to ultimately come under American purview. As the market grows, the amount of data grows, and Europe doesn't want to be left empty handed, or constantly having to hand over information for whatever reasons the US government sees fit.

And the market is growing. Already at nearly $41 billion, the cloud market in Europe looks to explode later on this decade:

Europe is still a relatively small slice of the global cloud market, which may expand to $241 billion in 2020 from $40.7 billion last year, according to Forrester Research Inc. North American and Asian telecommunications companies last year outspent European peers on cloud assets, with the latter accounting for only 7 percent of the $13.5 billion investments globally, according to researcher Informa Plc.

The cloud will become as important as the Internet in maintaining U.S. compet itiveness, according to a report that 71 of the nation’s largest technology companies submitted in July to the Obama administration.

I wouldn't be surprised if that estimate is low. The lower burden on individual electronic components (with less storage) added to the convenience of cloud-stored data seems to represent a huge opportunity. And with the increase in mobile technologies (beyond phones, and moving into tablets and the electronics available in cars), it seems likely to become as omnipresent a technology as the Internet itself.

It's also interesting to see nationalistic and regional behaviors in light of how globalized everything has become. It's certainly worth keeping an eye on for the SAP market, since the German company has found success both in its homeland and here in the US. 

Of course, this won't slow down cloud projects, whether they're new initiatives or migrations to the cloud. For some information on migration criteria, SAP Professional Journal readers can see "5 Criteria for Migrating an Application into the Cloud" and "Get Started with Cloud Computing and SAP Today."

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