Tech-hugging eurocrats imperil innovation puppy

Tech-hugging eurocrats imperil innovation puppy

Summary: Europe needs growth and cloud computing has a role to play. But are policy makers too eager for rapid results? An event later this month may yield some answers.


Can technology save Europe? Voters' rejection of austerity in last week's elections in France and Greece have spurred new efforts by European policymakers to find ways of fostering economic growth that will pull the continent out of its banking and financial crisis. Cloud computing is one sector that's under close scrutiny by officials at the European Commission in Brussels and at many national finance and business ministeries as a potential catalyst for growth. A recent study by Boston Consulting Group found that the Internet economy in the G20 nations will grow by an average of more than ten percent annually over the next few years, and is especially crucial for growth in the crucial small and medium enterprise (SME) sector. No wonder policy makers want to maximise their economy's share of that upside.

But could their enthusiasm prove counter-productive? I was reminded of a conversation I had at February's DLA Piper European Technology Leaders Summit in London. A lawyer and academic who works closely with the Commission on plans for regulation told me he was "fearful because they are so enthusiastic about technology" as a driver of economic growth. He conjured up the arresting image of the tech industry as a lovable puppy being literally smothered by an over-enthusiastic new owner.

The problem is that policy makers at the Commission see regulation as a way of encouraging innovation. But the enthusiasm to act may result in regulations getting drafted without sufficient consideration for the burdens they place on new and existing participants. "There is a danger that they are going to suffocate it with too much regulation," he warned.

This risk will probably be one of the themes of discussion at an event later this month designed to shine a spotlight on the cloud computing industry across Europe. EuroCloud Day is taking place simultaneously on May 23rd in ten European cities, with shared keynotes broadcast to all venues by the EU's Digital Agenda Commissioner Neelie Kroes, and speakers from SAP and the Chinese Institute of Electronics. These shared sessions will be interspersed with local sessions at each venue. Participating EuroCloud countries include Italy, the Netherlands, UK, Germany, Austria, Hungary, Slovenia, France, Portugal, Denmark, Sweden and Finland.

The London event, which I've organised in my role as chair of EuroCloud UK [see disclosure], will focus on success strategies for cloud start-ups. Held at the new Google Campus in London Tech City, there are keynotes from Alastair Mitchell, CEO of cloud collaboration vendor Huddle and Tien Tzuo, CEO and founder of subscription billing provider Zuora, plus a panel of UK cloud founders including Duane Jackson of Kashflow, Piers Linney of Outsourcery, Tim Barker of DataSift, Jimmy Gasteen of Precursive and Bernard Dallé from Index Ventures. Registration is free to cloud start-up founders and EuroCloud members.

One of the curiosities that strikes me when listening to debates in Europe about how to stimulate growth is that they often follow a path that would seem very out of place to a US audience. They tend to be heavily focused on what government agencies can do to foster innovation and growth. Whereas in the US, the assumption is that the market takes care of that and government has no role to play. Certainly the upsurge in tech startups in London's Tech City has been a good example of private enterprise making its own way in the world, with the UK government only recently taking an active interest in stimulating further development. We need to get the balance right to make sure the innovation puppy will not suffocate but thrive and grow.

Topics: Virtualization, CXO, Cloud, Emerging Tech, Government, Government US, Hardware, Servers

Phil Wainewright

About Phil Wainewright

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

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.


Log in or register to join the discussion
  • Yep the market will take care of that

    Worked so well in the USA, didn't it?
  • Citizen before big business...

    One of the key differences I see between the USA and Europe is that the EU laws, currently, are aimed at protecting the average citizen first and aiding business as a secondary goal.

    They want to drive change, they want to drive growth, but they don't want to destroy the rights and freedoms the average citizen has.

    Maybe this is because the American method of bribing politicians, sorry, lobbying with breifcases full of campaign money and promises of jobs, is not so prevalent and most of the MPs here actually do, to a bigger degree than in the USA, listen to what their constituents want, as opposed to just what big business wants.

    Obviously, there are those that are corrupt or don't listen, because they have private agendas.

    The biggest problem, going forward, for Europe are the unelected elite of the EU, the Barrosos and Van Rompuys. They wield a lot of power over the EU, yet they are not elected by the citizens they are supposed to be looking out for.
  • Growth of the negative kind

    You can only see economic growth in cloud computing if you forget that cloud computing is not new computing, but a replacement for on-premises computing. What's worse, the big draw for cloud computing is cost savings, which means one needs fewer servers, fewer people, less electricity, and so on, compared to an in-house data center. That's not economic growth, that's lower demand and higher unemployment.

    Left to themselves, the resources saved by cloud computing will tend to find their way into the next-best thing, whatever that is. But the more the bureaucrats get involved, the more likely it is that the resources saved will be directed into the latest fad among politicians.
    Robert Hahn
    • Agreed

      Cloud computing will save costs, meaning less money is in circulation, thereby harming growth.

      Companies will continue to make products but customers will either be unemployed and too poor to buy them, or too worried about loosing their jobs and therefore saving money rather than purchasing. Thus is a continuous downward spiral of economic decline unleashed.

      What is needed are more inefficient, labour intensive methods, the kinds only a bureaucracy of stifling complexity can achieve. This will create more jobs and aid liquidity, leading to growth and prosperity for all.

      Efficiency is clearly is the enemy of prosperity.
      • not always

        Henry Ford created the moving assembly line to increase efficiency... but also chose to pay a fair wage rather than exploit to pocket the difference...

        The enemy of prosperity is greed.


        J. = Jesus or Judas, of course...