Is Data Protection Holding Back European Businesses

Why are companies within the European Union yet to warm to the Cloud?

Businesses within the EU are not adopting cloud-based systems as quickly as expected. Do data protection laws and restrictions play a role in Europe’s slow uptake?

Despite the fact that cloud computing now plays a vital role in the development of our businesses, use of the Cloud amongst businesses in the European Union did not increase in 2014. For those who believed Europe to be at the forefront of the business revolution, this is perhaps surprising, but politics within the EU reveal the complications associated with widespread use of the Cloud.

As described below, it may not be until some problems associated with data protection and privacy are resolved that the EU can embrace a 21st century way of working.

The EU Eurostat Report

In November 2014, the EU released its report on ‘Cloud Computing – statistics on the use by enterprises’. The report breaks down the usage of cloud services and applications, collectively known as ‘cloudware’, by EU member states, providing some startling contrasts across the Union.

For example, in countries that were the so-called ‘leaders’ of cloud computing in Europe, only 50% of enterprises used ‘some’ cloud services. Only 11% and 12% of businesses in the European powerhouses Germany and France respectively were using cloud-based systems, while less than 10% of business in countries such as Poland and Bulgaria were embracing the Cloud.

The UK fared slightly better, but still, only 24% of enterprises admitted to using the Cloud.

In terms of what the member states use cloud systems for, 19% use the technology to host emails and 46% of those firms run cloud-based accounting software or customer relationship management tools.

In comparison to businesses in countries such as America, the EU seems slow to adapt to the cloud computing revolution. No doubt it is an expanding industry, but if the use of cloudware is as important for competing businesses as experts suggest, giant economies such as France and Germany should by now be leveraging its full potential, otherwise they’re running the risk of falling behind on a global scale.

Data protection

One big problem for businesses in the EU is the individual data protection acts that are deployed in member states. Many individual countries are hesitant to have their data shared online, and unfortunately this can affect the EU as a whole. Unlike the US, where data legislation is enforced on a federal level across all states, the EU has to deal with data protection on a country-by-country basis.

These difficulties were hoped to have been solved, at least in part, by a new EU Data Protection Regulation, but serious differences between member states mean the revised regulations are likely to be pushed back until 2016.

Data concerns are a big deal for the EU, but a lack of confidence in the security of new technology is not the only reason why the continent’s bright business minds aren’t warming to the Cloud. Many EU members just don’t know enough about cloud computing in the first place.

In fact, a massive 81% of the European enterprises who are currently not using the Cloud cited insufficient knowledge as their main stumbling block.

Alongside the prolonged myth that cloud services and applications aren’t as safe as companies would like them to be, this means that decision makers will simply not implement cloud systems because they don’t know how to.

What can be done to improve cloud adoption in the EU?

Clearly, the EU needs to put a definitive strategy in place if it is to encourage member states to adopt cloud technology at the same rate as other prosperous regions.

Until action is taken, and European businesses are able to form a more positive view of the Cloud, the EU will continue to lag behind in this area. Data protection is important, but laws governing our information shouldn’t be allowed to hinder society’s technological progress in this way. We think that a greater understanding of the benefits of the Cloud could transform Europe’s flagging IT infrastructure into a cloud-driven model that promotes a larger, healthier economy, at home and on a global scale.

By Gary Gould