Is it too late for Europe to fight back?

Is it too late for Europe to fight back?

Summary: It frustrates me that the supposedly single market in Europe is a concept that has existed for more than fifty years, but we're still far removed from seeing it in practice, in particular for cloud providers.


Loic LeMeur says that he has ditched Europe for Silicon Valley, and I can't say I blame him. For my personal life, I've made a deliberate choice to stay based in London, but pretty much all of my business activity until the past year or two has been centered on Silicon Valley. To me, San Francisco still feels more like a second home than Paris, Barcelona, Luxembourg or Dublin, despite my business dealings with those far closer locations.

And yet it frustrates me that this state of affairs should exist. The supposedly single market in Europe is a concept that has existed for more than fifty years, but we're still far removed from seeing it in practice, in particular for cloud providers. I see US entrepreneurs able to address a single market of 300 million individuals and a GDP almost as large as Europe's, without ever once having to negotiate different currencies, languages, business practices or data protection and retention regulations. In Europe, these barriers are a constant nightmare for entrepreneurs. Loic talks about the limited goals entrepreneurs set themselves in Europe, but in many ways it's inevitable that businesses will choose to face such challenges one step at a time, conquering markets one by one rather than all at once.

A couple of years ago, I decided to support an initiative called EuroCloud, whose mission is to fight for a more level playing field in Europe — to promote the benefits of cloud computing for European businesses and to press for the removal of barriers to an effective and competitive cloud computing industry here. Tomorrow, EuroCloud's leaders are coming to London for a quarterly board meeting and the local EuroCloud UK branch is hosting a meeting about this very topic.

Echoing a comment made by a member at one of our meetings last year, we've titled the event 'Let's Flatten Europe'. We'll be looking at the barriers, both real and imagined, that face cloud providers who want to expand out of their home countries and deliver services across national borders in Europe. We'll focus on the strategies that providers have found successful, aided by participants who are grappling with these issues every day, including Microsoft, NTRGlobal, NaviSite, Mimecast, SAP and representatives from a number of European countries.

For the first time, the event will be webcast, so wherever you are, you're welcome to join us online. If you happen to be in London, you can register to attend the event in person. I think Loic is right, that if you want to create a global success story, the easiest place to do that from is Silicon Valley. But I don't think it has to be that way, and tomorrow's event is part of a campaign to make Europe more competitive for cloud entrepreneurs.

Topics: CXO, Cloud, Hardware, Servers, Virtualization

Phil Wainewright

About Phil Wainewright

Since 1998, Phil Wainewright has been a thought leader in cloud computing as a blogger, analyst and consultant.

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  • If the bureaucrats in Europe want a stronger economy

    they will need to get out of the way
    something tells me they just don't care
    they don't have to earn a living on the open market
    • There are differences in economies, also

      @zmud <br>Is there not a provision that is automaticly applied once a competitor for a certain product aquires 39 percent of the market, that in effect sets new limitations on that company in an effort to allow smaller companies a chance to compete?<br><br>As abn example, would Apple, if it were based in the EU, be allowed to control 70 percent of the MP3 player market, as it does in the US?
      Tim Cook
      • Largest problem is ignorance.

        @Mister Spock

        There is no such provision. (See for how the EU Competition works). Judging by what I see people listening to music on, Apple may have a dominant position here too, but as long as they done abuse it, they are free to continue.

        The purpose of this competition "beaurocrats" is to keep the single market both single and open. Look at their case histories, and I think its clear they both needed and beneficial.

        I've worked with the EU market for 25 of the last 50 years, and I have seen huge changes. Many countries do indeed share a single currency, language is less of a barrier now than it has ever been, and local legislation is not that different. One of my bugbears surrounds IP usage rights that are typically done piecemeal, but thats entirely the responsibility of the IP owners, not the rules of the market.

        The European single market will never be as flat as the USA, but then again we have an incredible diverse cultural heritage, and maybe we don't want to abandon it in the name of capitalistic progress.
      • njoho: The European hardheadedness sounds like a recipe for failure..

        and it doesn't matter how much anybody there values their "heritage" or cultures.

        The most important aspect of any civilized society is the economic well-being of the citizenry, and whether you would like to admit it or not, "capitalistic progress" is the only means with which to attain that economic well-being.

        The old USSR, which dedicated so much of their resources to trying to create a superior culture, eventually found out that, without a great economy, everything else is doomed to failure. So, it sounds to me like the Europeans are destined to repeat the mistakes of the past until it's too late to change course, and the only thing they can do then is to start over.
      • RE: Is it too late for Europe to fight back?


        Your being too simplistic. Do you really think that Italians will abandon their language for English (or whatever), in the interests of "economic wellbeing".

        Would you abandon english for Chinese for the same reason?

        However, my point was that huge changes have already been made in order to create a single market, but there are limits to this, and a continent of 27 soverign states simply will never acheive the same degree of flatness as the USA.
      • njoho: You're still not understanding my points,

        and my points were not about culture or languages or country pride.

        It was about the overall well-being of a citizenry, and without that well-being, culture and language are irrelevant and won't feed hungry mouths.

        Now, what the European community, and some individual countries have been trying, and tried in the past, has failed, every time. I'm talking about socialism, no matter what flavor and no matter what experimentation is tried in order to make it palatable. But, it's inevitable that socialism is unsustainable as an economic model, and, although it may take time for it to fail, it will eventually collapse any country that uses it as it's economic system. The old Soviet Union was destined to fail, and so were all the other economies like Spain and Portugal and Greece, and yes, even Italy.

        You may not like it, but the fact is that, capitalism is the best wealth creation system that humans have ever used. It might be showing weaknesses in the U.S., but it's because the system implemented in the U.S. has been allowed to get tainted by intrusions of socialism.

        But, you can go ahead and call me simplistic. Making things difficult is not going to change the outcome that is inevitable.
  • Never.

    Go Europe!
  • Im surprised he didn't see the similarities

    Spent weeks in western Europe and California in 2010.

    The similarities were striking. Both rapidly declining, language barriers, high levels of unemployment combined with delusional citizens supporting bankrupted governments.

    Both have an unbelief amount of legislation stifling their citizens. The irony today is you have more freedom in the former communist countries of eastern Europe. I enjoyed my 2 months in eastern Europe the most of all.

    One day the other wake up and discover what they've missed.
    Richard Flude
    • Yet...

      @Richard Flude

      Yet the EU remains the world's largest econony (by GDP(PPP)). The EU also has literacy rates of 99% (compared to 85% in the USA), which is encouraging for long term employment outlook.

      I'm not saying that the EU is not without its issues, but look at the progress that is being made - the integration of former eastern communist states. Also, don't forget that not even 40 years ago, western countries Spain and Portugal were fascist dictatorships.

      Don't measure us by the problems we face, but how we face them. Decline? I don't think so.
      • RE: Is it too late for Europe to fight back?

        @njoho USA has the world's largest economy despite only 320 million people. per capita we are still in the top 10 while you take the the EU countries seperately and they are way behind. the only ones ahead of us are much smaller countries many of which export oil.

        The EU still has a long ways to go. You need to tone down the stifling regulations, you need tort reform, and your governments need to stop the excessive spending. We can say the same thing about the Obama administration. That is if you want a robust economy.
  • Eurozone is profitable...

    So they must be doing something right, if they could only agree on what that something is.

    I reckon most of the success is from the policies from Santer and Delors, and if you ditched all the policies since 2000 (which were basically a lot of surveillance, lobbyist and USA inspired stuff), then EU would be a lot better.

    The current Greece thing and Ireland debt problem.... well that's all talk, that debt is funded by sales of goods and service, not printed money, so the core economy is solid.
    • Head in the sand is not a solution...

      to the problems plaguing the entire European community.

      The problems in Greece and in Ireland and in Portugal and in Spain are devastating to those countries, individually, and to the entire continent, no matter how much some countries seem to be faring better than others. The reality is that, eventually, the whole continent will have to face the realities of the situation, and hard choices will need to be made. Being in denial and just hoping for miracles is not going to resolve any of the problems in the continent.
      • RE: Is it too late for Europe to fight back?

        @adornoe@... Well, we are making tough choices. Both Ireland and Greece have been forced to cut spending drastically. The national budgets are supervised by the community as a whole....

        When was the last time the US cut spending and reduced its deficit? When did the US make tough choices? At the moment, you are printing money like mad.
      • kiki: I agree with you and in the U.S., some very tough choices are going

        to have to be made.<br><br>The Europeans are ahead of us in realizing that just spending more is NOT going to pull them out of the deep holes they dug themselves into. In the U.S., we've begun to take actions to remedy the problems, but, for the most part, it's because the electorate told our politicians that things were out of control and corrective actions were needed. <br><br>However, there are those still in power who did not hear the message of the people when those people voted out the majority from congress. The people will have to continue the purge until politicians get it right. But, we've started, and now, instead of looking for more spending and bigger government, there are a lot of politicians who are talking about cutting down the size of government and not just cutting spending, but bringing it back to 2006 levels. It's a start, but a lot more needs to be done.
  • Europeans are lazy!

    It is too bad, as it is a nice place to live. I have been here for twenty years after living in Canada and the US. The work ethic is spoiled by excessive government regulation and coddling. Unfortunately, European countries cannot afford their very generous social programs.

    Bottom line, Europe is a good place to retire, but not a place to bring up your children.
  • RE: Is it too late for Europe to fight back?

    Wow, this is getting really funny. Americans lecturing Europeans about sound business practices and capitalism, when all I can see in the US are bankrupt home owners, bankrupt banks, bailed out banks, bankrupt car industry, bailed out car industry, bankrupt California and a bankrupt central government. The only thing that is really working well is the printing press of the federal reserve ;-)
  • Harmonization

    "I see US entrepreneurs able to address a single market of 300 million individuals and a GDP almost as large as Europe?s, without ever once having to negotiate different currencies, languages, business practices or data protection and retention regulations. "

    Countries in the Eurozone do not have to negotiate different currencies. Britain chose to keep the pound, but I don't think it was a good choice. Harmonizing legislation means further legal integration in the EU. Something Britain usually opposes. Language differences won't disappear, but English is usually understood.

    Now, I know all this sound terribly complicated to Americans and it is more complicated than in the US. But, this rubbish about capitalism vs socialism equals USA vs. Europe really shows an incredible amount of ignorance.

    What about the American welfare system? The cost for medicare is exploding, but the majority of people isn't even insured. The pension payments are exploding. The only people who can be sure to be bailed out are the US bankers on wallstreet. The US public debt has reached 100% of GDP and it is increasing faster and faster under the Obama administration....

    The US federal government is just as broke as Greece. The only thing letting it survive is the federal reserve.

    The US hasn't even begun to address its problems.
  • Capitalism and Europe

    @adornoe:<br><br>I apologize if I have missed the point in your paragraph below (please correct me):<br><br><I>You may not like it, but the fact is that, capitalism is the best wealth creation system that humans have ever used. It might be showing weaknesses in the U.S., but it's because the system implemented in the U.S. has been allowed to get tainted by intrusions of socialism.</I><br><br>The way I see it, the US government is increasingly folding under the thumb of the corporations, the single aim of the latter being - not to create a strong social structure for its people - but rather the obvious - GREED for more POWER & WEALTH.<br>How does that translate as healthy, or sociable, for the people down below (us plebs)? <br>These so called capitalists, are slowly adopting the negative points from a system, which they so many years fought against during the cold war, i.e. - control of the government and the laws, enabling them to achieve their egoscentric (capitalistic) goals. <br>I dont think their motivation is to help us achieve a better life. Is it?<br><br>I do believe the capitalist system to be the closest we have to the human nature (eat or be eaten), hence, it is widely adopted and probably rightfully so.<br>It represents the natural choice that was formed and created, along with the sociological evolution of mankind. However, because greed is a deep root in our nature, it will manifest itself always, regardless of which political system you choose. <br><br>Any political system should evolve and adapt with time, and having said that, one of the goals Europe is trying to achieve, a capitalism, which will also benefit its people i.e. simply said a strong social system. Naturally this is not easy and problems are to be expected.<br>On the other hand, holding on to the feudalistic roots of the Capitalism is typical for shortsighted governments only.
    • Capitalism is the engine for creating wealth and for eliminating poverty

      While under capitalism you'll still have the greedy, there is not denying that, for the most part, it's the only economic system which can pull a country out of poverty. Socialism has proven over and over again that it can't sustain a government nor a country. Eventually, it collapses upon itself with the needs of a country overtaking the productivity. Capitalism with interspersed socialism is not much better because, the socialism creeps up to overtake the capitalistic components, and, though that economic system will take longer to collapse than a strictly socialistic system, the fact remains that eventually, the capitalist/socialism model will eventual fail just the same.

      I might hate the abuses that come from a strictly capitalist system, but, for the most part, it produces much more wealth and a much better economic system for a country, which pulls more people out of poverty than any other system.
      • RE: Is it too late for Europe to fight back?

        @adornoe<br><br>I will reiterate - I believe that it is the human greed that creeps to overtake any system, as you have put it.<br>It is well evident in the modern capitalism, i.e. - controlling the ruling body (government) to facilitate the further enrichment of the already wealthy. There is a very true slogan - Money makes Money.<br>The true capitalism in its pure form is fine. However, when you start making plans to have advantage over your competitor by going around behind and paying off the law makers, this is not socialism creeping up to overtake the current system, but clearly - human greed in it's pure form. Greed is a double-sided sword. It helps progress, but it also impairs it at the same time.<br><br>It will probably sound childish, but all highly industrialized capitalist countries do have slums! If you are referring to poverty <b>there</b> - yes it is low. <br>True Capitalism might help create a bigger middle class and thus diminish the low class and poverty - true. <br>However, if you look at this from a global perspective, the third world countries are in fact the slums of the rich nations.<br>The wealthy countries pillaged for natural resources for many years from their colonies (and on many occasions still do), thus enabling them to take the upper hand in all aspects of life - research, culture, economy etc. To compete with this juggernaut is disadvantageous for newly emerging economies / countries (many of them former colonies). Even if they make a breakthrough in some field, it is quickly acquired by the wealthier economies, in order to keep the advantage they have. This is a one-way street. <br><br>My country can also plunder for half a century from its colonies, thus making it strong, while the third world remains somewhere out there. <br>Is this Capitalism - no! Imperialism - most certainly! <br>The third world countries are poor not because they are not capitalist, but because the <b>greedy</b> capitalists came, took and left. But that is because we are human. We can never have enough!<br><br>Sincerely.