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Cloud Market Research Study Presentation

The Cloud service market is of primary importance, with a size of already nearly 190 B€ in the EU in 2022 and a forecasted annual growth of 13% over the coming decade. It acts as a key enabler in the majority of European industrial ecosystems.

Our report gives valuable insights into how Europe can addresses both legal and technical steps needed to enable Cloud interoperability.

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The costs of cloud services have been rising rapidly in recent years, harming both the competitiveness of European industry and the purchasing power of European end customers in the context of inflation.

Despite the historical strengths of the EU in application software with leaders such as SAP, Dassault Systèmes, and Siemens Software… the EU ecosystem of Cloud Service Providers (CSP) remains small and limited in its ability to grow. EU players only own 16% market shares on the EU SaaS market, and this share tends to decrease over the years.

This situation is largely due to the oligopolistic situation on the EU Cloud market with 90% market shares being owned by three providers (AWS, Microsoft, and Google), inducing a distortion of competition in three ways:

  1. Consumers lock-in. Making it impossible for software vendors to replace their Cloud computing supplier with another one.
  2. Software vendors lock-out. Making it impossible for Cloud Service Providers (CSP) to propose their services to SaaS developers already engaged with another CSP.
  3. Unfair competition. Where a leading Cloud Service Provider (CSP) can use its position to hamper the quality of the offer of its competitors.

Such situation is a threat for the digital sovereignty of the EU. The entire European economy is facing a risk of dependence given the importance cloud-based software is having in segments of our industry.

However, this oligopolistic situation and its consequences could be solved through the building of a legal and technical framework enabling full Cloud interoperability. The recent “Data Act” proposal is the opportunity to build such a framework, it already contains regulatory obligations related to Cloud interoperability and data portability, OSC would technical enable it.

Open Services Cloud is an open-source framework that aims to simplify the inherent complexity of the current Cloud offerings by covering multiple aspects:

  • A semantic layer: the framework comes with a cloud neutral semantic layer, the Open Services Cloud Configuration Language, OCL. It’s a descriptive language that allows, via a standardized code structure, to describe service and workload deployments in the Cloud.
  • An orchestration platform: this component ensures consistency of the deployments across multiple Clouds. It enables users to deploy and manage applications on various Cloud platforms via a central console while providing in data management capabilities in parallel, removing Cloud lock-in.

Overall, the introduction of Open Services Cloud to the market would represent multiple advantages that would benefit all parties involved:

  1. Integration costs optimization as Cloud Service Providers and Software Editors face a challenge of cloud integration that will now be mitigated
  2. Market cost efficiency as Open Services Cloud would incur synergies by reducing complexity to deploy in multiple Clouds, allowing all parties to simplify cross-Cloud workload deployment. This increased competitivity will lower overall costs as the lock-in effect would be reduced.
  3. Skills management as in most countries, the market for Cloud subject matter experts is very tense, and software vendors can’t “templatize” their deployments due to the huge variety of Cloud platforms available.
  4. Cloud portability would be ensured by providing a standardized way to deploy workloads in any Cloud. Open Services Cloud removes the barriers of redeploying workloads elsewhere, allowing for more mobility and drastically reducing the related frictions
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