Encouraging the adoption of cloud in the public sector is an essential step toward establishing a “cloud-active” European Union. That is the conclusion of recent findings by research firm Frost & Sullivan (News - Alert), which also revealed that European companies are largely hesitant to adopt cloud computing due to its “unreliable” nature and lack of widespread adoption overall.
“The relative newness and underdevelopment of the cloud computing market is the primary reason that public sector organizations delay adoption,” said Frost & Sullivan’s Research Analyst Jayashree Rajagopal. “Several high-profile service outages in 2011, such as serious technical difficulties that struck Amazon Web Services (News 
- Alert) and affected a public cloud that serves thousands of businesses resulted in more reliability questions.”
In recent months, the European Commission has worked on developing a cloud computing strategy to boost uptake across all businesses in the European Union, with the aim to make Europe not only cloud friendly, but “cloud active,” Frost & Sullivan said.
However, many European organizations remain hesitant about adopting cloud computing due to reliability and safety issues. In the public sector, there are other challenges including a lack of international standards: “strict data transfer regulations and differences in privacy and confidentiality definitions could affect compliance across borders,” the research firm said.
Data ownership and service accountability issues between ICT providers and public sector organizations are also big concerns.
“Compliance with government regulations also has to be considered,” Rajagopal added. “The amount of data generated and the required security levels vary considerably across public sectors such as healthcare and transportation. A cloud service should meet basic requirements as well as address security concerns specific to a sector.”
Major entities are considering two options: private clouds that would either be managed internally or by a third-party and hosted internally or externally; and hybrid clouds, in which the organization provides and manages some resources in-house and has others provided externally.
Recent consultations by the European Commission have concluded that cloud computing can be a low-cost and energy-friendly alternative to existing systems. Although data protection regulations have become stronger to suit the dynamic ICT world, cloud computing will only be accepted with a large-scale adoption, Frost & Sullivan said.
In January, the European Commission (EC) announced its intention to the make Europe one of the most “cloud-active” regions in the world with the formation of a European Cloud Partnership (ECP) that will launch with a €10m investment.
When it comes to investment, North America and Asia are leading the global cloud computing market, according to recent industry research, putting European telecom operators at risk for lagging behind, TMCnet reported.
Informa’s (News - Alert) Telecom Cloud Monitor revealed that European operators accounted for only 7 percent of the $13.5 billion that operators invested in cloud assets in 2011. North American and Asian operators accounted for 90 percent, or $12 billion.
IT analysts say that European operators are being “outgunned” in cloud infrastructure.
“Although they are working to stimulate local demand, their investment strategy remains cautious,” said Camille Mendler, principal analyst at Informa Telecoms & Media (News - Alert).
Uncertainty around European security and privacy laws, coupled with continuing economic weakness, are gating cloud investment, Mendler explained. The European Commission aims to define a common legal framework for cloud computing in 2012.
Edited by
Amanda Ciccatelli
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