Cross-border data flow in the digital single market: study on data location restrictions (SMART 2015/0054) deployment of cloud data centres in the eight Member States with the highest number of obligations restricting data flow across borders. At the start of the study the geographical coverage of cloud data services was unknown and it was not known where local data restrictions existed. As a result the study did not analyse different scenarios for location restrictions resulting in negative economic impacts (costs). For example, it was not possible to examine how organisations (public and private) in Member States, which were not served by large services providers that had a cloud data centre in their country, were affected. Organisations with their own data storage solutions might have incurred additional costs, smaller organisations without this capability might also have struggled. This would be a valuable area for further analysis.
4.5 Cloud data centre costs Gartner forecast that the global market for cloud-computing services was $160 billion in 2015. That is still only four per cent of all IT spending, but it is growing fast, as most other parts of the industry are stagnant or even declining. By 2016 Gartner predicted growth of 16.5 per cent to €186 billion50. The Economist51 identified the five leading global cloud service providers, see figure 24. Figure 24 - Market share of leading global cloud service providers Q4 2014
Source: Synergy Research Group 2015
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In September 2016 McKinsey announced that “The cloud debate is over—businesses are now moving a material portion of IT workloads to cloud environments”. While the preceding figures are large and studies show the growing importance of cloud computing it is important to focus on the impact of the cross border data obligations and regulations. This study therefore focuses on cloud data centres to provide illustrative examples of costs for services providers in addressing cross border data flow regulations. 50
th
http://www.gartner.com/newsroom/id/3188817 25 January 2016 Economist. 2015. The cheap convenient cloud. http://www.economist.com/news/business/21648685-cloudcomputing-prices-keep-falling-whole-it-business-will-change-cheap-convenient 52 Quoted in Economist. 2015. The cheap convenient cloud. 51
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