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Buckle up for a new wave of cloud protectionism

Add France to the list of European countries pushing a nationalistic cloud computing agenda, one that could have huge repercussions for U.S.-based cloud powers and the nature of cloud computing in general.

France Telecom is partnering with Thales SA, a maker of aerospace systems and industrial electronics, to build a homegrown cloud to offer built-in-France software, according to a Bloomberg news report.

And the verbiage is getting heated.

“It’s the beginning of a fight between two giants,” Jean-Francois Audenard, the cloud security advisor to France Telecom, told Bloomberg.  Audenard added:

It’s extremely important to have the governments of Europe take care of this issue because if all the data of enterprises were going to be under the control of the U.S., it’s not really good for the future of the European people.

The impetus or justification comes from the U.S. Patriot Act, which allows U.S. law enforcement to force disclosure of cloud-based data if they perceive a security threat. Last spring Microsoft (s msft) said that it would have to hand cloud data over to U.S. authorities if asked, even if it resides in the company’s European data centers.

Such statements obviously caused consternation in the European Union, especially in Germany, which has much tighter data privacy laws than most countries.

In September, Reinhard Clemens, the CEO of Deutsche Telekom’s T-systems group, said local regulators should enable super secure clouds to be built in Germany or elsewhere in Europe. He cited pent-up demand among customers who do not want their information accessible to the U.S. government.

Some in the U.S. will cry protectionism as American companies ranging from Google (s goog) to Microsoft to Facebook now lead the universe in creating very efficient data centers to run their massive cloud operations. If EU countries all proceed along this path, there could be severe repercussions not only for these companies but also for the value of cloud computing.

And this Europe-first policy, if it takes hold, is risky for the Europeans as well. According to a new report from Informa, the European telecom operators that are pushing this strategy “risk being sidelined in the global cloud computing market as aggressive North American and Asian operators spend billions to build international presence.”

The Informa Telecom Cloud Monitor shows that these European operators make up just 7 percent of the world’s overall cloud assets as of 2011, while their North American and Asian counterparts account for 90 percent.

As GigaOM reported last month, U.S. tech giants aren’t taking this threat lying down. Google, IBM(s ibm), Citi(s c) and several other large U.S. tech and banking companies are lobbying the U.S. government to push global treaties to assure the free flow of information across international borders. But the Patriot Act could hobble their efforts.

Photo courtesy of Flickr user dandeluca

10 Responses to “Buckle up for a new wave of cloud protectionism”

  1. The question comes down to do all affiliated companies fall under the Patriot act?

    Thus is Google UK, a separate, wholly owned subsidiary of Google Inc, required to turn data over under the Patriot Act when Google Inc is requested to do so?

  2. I’ll join the chorus. The article misses the point. This has nothing to do with cloud computing, and everything to do with information and data privacy, which pre-dates cloud computing. it’s the Patriot Act and the US vs EU approach to data privacy that have brought it to the fore. If the information were stored in shoe boxes in the US instead of cloud servers, the reactions would be the same.

  3. I’ll join the chorus. This has nothing to do with cloud, and everything to do with information and data privacy. These laws have been around well before cloud computing; it’s the Patriot Act and the general US view on data privacy that have brought it to the fore. If the information were stored in shoe boxes in the US instead of cloud servers, the reactions would be the same.

    Michael Gentle

  4. Jeremy Bee

    You are framing this debate incorrectly (protectionism), and missing a salient point. Most “western” countries outside the USA have data protection and privacy laws. As long as the USA allows it’s government to (potentially) view, download and track all the information on servers located in the USA, how can any non-USA entity use them without breaking these laws? I know this is the case in Canada. It is illegal for any government or public agency to use any service that has servers based in the USA.

    It’s the patriot act problem again, not nationalism.

  5. David Wo

    It’s not just the Patriot Act that worries us here in Europe. It’s the fundamental differences in attitudes about privacy.

    The EU uses a comprehensive approach to privacy, treating all data regarding an individual in all contexts. Any technology or implementation must adopt fundamental privacy considerations from the very start, before release.

    The US uses sector-specific legislation or regulation, and sometimes self-regulation. New legislation or regulations must be considered with each new technology; privacy protections typically lag new technologies.

    Whilst general data protection is a primary motivator for privacy protection in the EU, it is not in the US.

    I’d say that the EU is highly proactive in this area, the US completely reactive.