The issue is not lack of european providers. The issue is almost natural lobby from the likes of Microsoft and Amazon.
All the unis are infected with former corpo programmers who push their preferred employer stacks. Students get free credits to use on Azure. Some of them become gov employees or consultants. You end up with all sides agreeing Microsoft Azure is the most trustworthy solution.
Everything gov in my country seems to be built with asp.net to point where its often requirement in the contract.
Lets start with erasing all the proprietary tech taught at universities. Microsoft can do their education. Universities dont have to do it for them for free.
Also Microsoft consultants are everywhere, and management consultants like McKinsey usually work closely with Microsoft, and many corporations are already locked in.
In many ways its kind of really scary how so much of the digital infrastructure even of key enterprises and entire states is owned and operated by a private company.
It didnt use to be open-source. Its closely tied to MS which can do whatever about it. It will always have better support on MS and Azure. It still MS stack and if you want to get out of that you have bazilion better more free options.
I didn’t see any mention of EU’s last attempt to build a sovereign cloud: Gaia-X. I think that didn’t really go anywhere due to disagreements over technical direction. Much like Quaero.
Don’t get me wrong, I hope it goes better this time and the author acknowledges the many pitfalls of such a complex undertaking.
" Innovation Mindset: Willingness to explore new technologies – especially related to trust frameworks and associated standards –, staying ahead (no kidding!) of main-stream industry trends (This is a real requirement, not ChatGPT – just look into our GitLab repos!)."
I checked their public GitLab and it's puny. Moreover, I suspect based on the use of bold and bullet points that the job description itself went through ChatGPT.
Without protection, a EU hyperscaler will never emerge. It's not that any hypothetical future EU hyperscaler would be an inherently less competitive. It's just plain old first mover advantage. Cloud computing is a VERY sticky good, and once folks got on AWS/Azure no matter how good your product is there's no way larger customers are going to migrate off to some "risky" startup (thus keeping scale small).
Source: I worked on a sovereign cloud PaaS in Germany. Admittedly the project was a disaster, hiring talent in the infrastructure space here is really tough. Probably mostly due to a lack of opportunities to acquire experience domestically and noncompetitive wages limiting migration of those with experience.
Gaia-X is a total dumpster fire though, perfect example of what's wrong with the EU. All the money was spent paying bureaucrats, consults, and standards committee folks to architecture astronaut and design by committee sovereign cloud "standards" bullshit bingo. None of the money went to the engineers.
We should really copy the Chinese approach here, straight out clone a subset of the best/most popular parts of AWS/Azure/GCP. I'm open to contracting opportunities in this space BTW (email in profile).
It's more or less covert subsidies for the usual suspects. In Germany that means the like of Fraunhofer-Gesellschaft, Atos, Bosch, Deutsche Telekom, SAP, BMW and Siemens get some millions (and by "some" I mean around 200 million euro). If there's no outcome, like in the GAIA-X case, it's just bad luck for the taxpayer.
Disagreements over direction should be solved by making separate orgs/initiatives to go test each approach.
Better than funding “one true initiative” and force people to work together to keep the funding.
The VC funding model succeeds in experimental domains by letting many experiments run at once. Kind of a form of Darwinism. How to do that with funded initiatives is a really interesting challenge.
The impression I have, but I may be wrong, is that investors in Europe want a return on every investment. Failure is not an option. Which kind of choke innovation.
I don't think bureaucrats can build a successful cloud by enforcing laws, adding even more regulations, making policies and using subsidies.
This is not how the market likes to work. There has to be a demand and the free market forces will build a supply. Governments can help by reducing regulation and bureaucracy, reducing taxes.
Policies are often used to create markets or - like in this case is propose - to create that demand. The article makes the argument that free market failed to deliver in this sector in Europe.
One of the explanations is that once you lag behind competitors, if policies don't force to value specific parameters that can be fulfilled only by other competitors, no competitors will join the market because nobody is going to choose them. So the author argues for example to impose regulation for public tenders such as "must be subject to only EU laws". This creates a demand, which is not currently matching any offer in the market and creates market incentives for new players to compete.
So regulations can absolutely work where "free" market fails (quotes because even the big 3 are/were pumped full of money by government/defense contracts).
> There has to be a demand and the free market forces will build a supply
Not in all cases it doesn't.
If the return on investment isn't there or if companies are unable to fulfil the demand then the market has failed. Recent example of this has been EVs where regulation needed to step in to force the market forward.
>If the return on investment isn't there or if companies are unable to fulfil the demand then the market has failed.
If there's no demand, there's no problem. Also there's no money to be made. If there's demand there will always be companies to supply that demand. Of course, it takes a time.
Politics shouldn't dictate to economy.
>Recent example of this has been EVs where regulation needed to step in to force the market forward
Then why should people be forced to use EVs instead of whatever they like? That is not freedom.
Free markets like to make money for capital holders, and tend towards a monopoly or oligopoly as that maximizes profit extraction.
Name a free market where there is an economy of scale and network effect, which does not tend towards monopoly or oligopoly.
More fundamentally, if (say) Germany wants to move all of its government operations off of US-based IT, should it wait until the market has provided a solution? Or should it do like all governments have always done, and change the marketplace?
Nor is this unique to governments. Some of my clients require me to agree to their ethical practices, like "no child labor." They are using their purchasing power to change the marketplace.
Why do the countries with higher taxes and government regulations and policies over health care have better overall health outcomes than those with lower taxes and regulations?
There is a demand for clean beaches. Where is the free market for pollution control?
The topic we're discussing would seem to undermine your claim, as cloud is neither a monopoly nor an oligopoly despite having scale and network effects.
I agree with this. It doesn't make sense to have these low salaries. You want the best people that make a difference, business is like sport. Your team competes with other teams.
You can't expect to get Lionel Messi on your team with just €70k, but for €200k you get hell of a bargain.
This misunderstanding about EU/US salaries is so baffling to me, how this opinion can come up still in every EU conversation. Do people really just look at $$$ without a second of thought of how governments/taxation works and what they get for that salary/taxes?
People end up thinking this, but they're just looking at tech roles. However, the difference becomes clear when you compare other jobs. In tech, the US pays way more than Europe, for other jobs, they don't. Take teachers, for example:
- Median Salary in USA: $~58k [1]
- Median Salary in Berlin: 35k EUR [2]
So while there is a difference, it is by far not as huge a gap as in tech where Europe pays ~60-70k (very and some countries, e.g. Spain or Portugal way less) and in the US 200k-300k are not unusual.
The difference is that US companies understand the huge value creation potential of tech jobs (especially over the past 2 decades) whereas most european companies think value creation comes from having middle aged balding managers.
There are 44 countries in Europe. What makes you think that your experience of getting the most of your government/taxation whatever you want to call it matches the experience of any other European country government/system?
The cultures across Europe are anti growth and anti speculation
That facilitate it for other people, but not enough interest culture wide
It’s kind of interesting “why don’t we just make the same amount quarter after quarter” like, wow who knew you could do that? But speculation drives innovation. Permission to fail results in faster selective pressures.
Perhaps you mean "investment" rather than "speculation"?
All mainstream European politicians are in favor of more growth, more investment, more industry, more jobs, and so on, across the continent. The parties who are about "de-growth" are marginal, even as the climate crisis is on full steam.
The actual problem is lack of pro-risk capital. Almost all of Europe's capital is concentrated in 1) conservative industry giants, and 2) huge conservative pension funds.
Basically all capital in Europe, public as well as private, is risk averse. There are very few actual "VC"s. I'm not sure that's unambiguously a bad thing, but it is the difference.
Well, I'm of the opinion that one of the other blockers of major EU growth is the lack of a singular financial market; instead of one market like the USA, we have 27 markets. Twenty seven different sets regulations that all need to go out the window; exchanges in the double digits, most of which should shut down.
This balkanization will never lead to a growth-oriented modern financial system.
I don't know why they don't just hire the people who built Azure / AWS / GCP etc...
If you offer these people a good salary, tax cut and a EU passport after 4 years I suspect many will be open to move to London / Paris / Amsterdam for a few years.
Subsidise the high speed train between all these cities for 5 years, offer crosscountry startup cash and investment and you might just end up with a functioning IT sector in Europe.
The triangle London / Paris / Randstad really isn't much further apart than many Sillicon Valley HQs.
Hetzner is not small, I would say it's several times bigger than OVH in turnover, but this is just a guess based on their perceived markets and market share in those markets.
The cloud offered by Hetzner is the perfect sweet spot for me, but the vast majority of IT crowd and non-IT decision makers in EU want AWS-like.
But all EU alternatives that mimick AWS will be worse than the alternative.
Pretty much like wvery MS Word copycat was worse... until Google Docs shifted the paradygm.
> The cloud side isn't polished enough to pretend to be a cloud provider.
I mean, see Azure and Google Cloud a few years back. For quite a while the market was AWS, and also some joke services which nobody who wasn't required to used (notoriously, in 2012 Azure was substantially entirely down for _over a day_ due to a leap day).
OVH (french) is very well known and I like them a lot. Used them for domains a lot, because they are very cheap and their management is nice.
I also like very much ScaleWay (french also) for price and quality of service, have used them for years on my startup, can highly recommend.
Also heard a lot of good things about Infomaniak (swiss), but never used them myself.
Would love to hear about european cloud providers with comments from users.
China was able to build its own IT technologies thanks to decades of protectionism and smart maneuvers from the party. Europe, being under the US "umbrella", was in an almost impossible position to do so, along with the very poor attitude of European elites, which is one of rent-seeking rather than investment.
Regardless of the attitude, I don't see this happening without some form of protectionism, trump sperging out might be the chance of a century to reboot the European military and IT industries.
If Europe wants cloud protectionism then they need apply the usual methods: tariffs on foreign cloud services and requirements on public funds to be spent on the European cloud providers.
They could apply Chinese policy and require foreign cloud corporations to have locally owned partners that will own the technology produced locally.
> They could apply Chinese policy and require foreign cloud corporations to have locally owned partners that will own the technology produced locally.
This feels like a misunderstanding of the situation. China used that tactic in cases where the Chinese people didn't know how to how to build or do a thing, and it would have taken a long time to rediscover. Saudi Arabia uses the same tactic for the same reasons.
Europe is full of people who know how to build a big cloud. It's not easy, and there's certainly learning-by-doing required, but as the author observes many of the people who work on the US clouds are from Europe or India or still live there. The knowledge transfer has been happening continuously since the start and in both directions.
The reason Europe hasn't produced a competitor on the scale of AWS is simply because that business model is the exclusive preserve of already large tech companies. AWS, Azure, GCP and Oracle Cloud are all the products of huge firms that already had tens of thousands of software engineers and (with the exception of AWS) pre-existing very profitable businesses. They could afford to sink vast sums of treasure into buildouts well ahead of demand, and subsidize their clouds using the other businesses until they had been able to catch up with Amazon. In addition, they all had large pre-existing tech ecosystems to leverage.
European countries have failed to produce tech companies on that scale for all sorts of well analyzed reasons. Moaning about cloud specifically is of no use, it's just a symptom not a cause. The causes meanwhile are the usual grab bag of uncompetitive compensation (a symptom of being poor, it's a feedback loop), bad laws that retard innovation and yet which never get fixed (due to the prevalence of governments that are explicitly suspicious of companies being successful), and finally the culture of US firms which is very globalist, collaborative and internally open, making them pleasant places to work for the people in Europe who have the right skills.
Look at it this way - would a skilled engineer rather work on AWS, having global impact under a global brand selling to every kind of customer imaginable and justifying its existence through technical innovation, or on an explicitly parochial "Eurocloud" whose highest dream is merely cloning what AWS was ten years ago, and which exists for no better reason than some domestic politicians being unwilling to resolve their differences with one specific US administration?
It's just a fundamentally unappealing proposition even if pay was good, therefore, it won't happen.
Even if you manage to build the product (R&D) now you have to incentivize the private sector and governments to switch to the EU product. There's only few options of making this happen and tariffs could be one of them. Natural transition won't happen for many reasons.
Tariffs are not particularly different to subsidies. Effectively they are a subsidy except that consumers are paying for it more directly (being forced to pay more for inferior local products) instead of through other taxes. The source of funding and effect on prices are the most meaningful differences.
The recipe is simple but nobody supposedly wants to do it.
1. Find all (e.g. LinkedIn) the EU-based engineers working or having worked for American cloud companies.
2. Offer them a proportional salary to join and start building the EU cloud product.
3. Incentivize the engineers to top-performance by giving them bonuses, stocks, whatever ...
4. Go back to the garage engineering and cut-off the bureaucratic BS with endless PMs, milestones, JIRA boards, scrum masters, chapter masters, architects, and all other similar BS.
But EU doesn't want to do it - they rather spend money in ways so that "EU funds", which are supposedly public, end up running up to their pockets directly. Dozens of examples out there but "AI factories" being the last embodiment of that.
There’s nothing in the EU quite like DARPA: oriented to long term, fundamental, high risk, high reward projects.
Furthermore, this European DARPA would be an organization with its own physical structure - its own labs. Say, with each different discipline in a different EU country.
Readit News
All the unis are infected with former corpo programmers who push their preferred employer stacks. Students get free credits to use on Azure. Some of them become gov employees or consultants. You end up with all sides agreeing Microsoft Azure is the most trustworthy solution.
Everything gov in my country seems to be built with asp.net to point where its often requirement in the contract.
Lets start with erasing all the proprietary tech taught at universities. Microsoft can do their education. Universities dont have to do it for them for free.
In many ways its kind of really scary how so much of the digital infrastructure even of key enterprises and entire states is owned and operated by a private company.
Don’t get me wrong, I hope it goes better this time and the author acknowledges the many pitfalls of such a complex undertaking.
Edit: The author previously discussed Gaia-X at length here: https://berthub.eu/articles/posts/gaia-x-is-an-expensive-dis...
Look at this recent job ad for a Senior Software Developer / Tech Lead: https://www.linkedin.com/jobs/view/4181090679
AFAIU it's written by the CTO and see this gem:
" Innovation Mindset: Willingness to explore new technologies – especially related to trust frameworks and associated standards –, staying ahead (no kidding!) of main-stream industry trends (This is a real requirement, not ChatGPT – just look into our GitLab repos!)."
I checked their public GitLab and it's puny. Moreover, I suspect based on the use of bold and bullet points that the job description itself went through ChatGPT.
Remove them of the picture and the market will solve itself very quickly, most of the companies to replace them are already there in a weaker form.
The cloud platforms are nowhere near as hard to replace as the chips.
Source: I worked on a sovereign cloud PaaS in Germany. Admittedly the project was a disaster, hiring talent in the infrastructure space here is really tough. Probably mostly due to a lack of opportunities to acquire experience domestically and noncompetitive wages limiting migration of those with experience.
Gaia-X is a total dumpster fire though, perfect example of what's wrong with the EU. All the money was spent paying bureaucrats, consults, and standards committee folks to architecture astronaut and design by committee sovereign cloud "standards" bullshit bingo. None of the money went to the engineers.
We should really copy the Chinese approach here, straight out clone a subset of the best/most popular parts of AWS/Azure/GCP. I'm open to contracting opportunities in this space BTW (email in profile).
Even the utterly straightforward eucloud is better. Or make it cloud.eu :)
Better than funding “one true initiative” and force people to work together to keep the funding.
The VC funding model succeeds in experimental domains by letting many experiments run at once. Kind of a form of Darwinism. How to do that with funded initiatives is a really interesting challenge.
This is not how the market likes to work. There has to be a demand and the free market forces will build a supply. Governments can help by reducing regulation and bureaucracy, reducing taxes.
Not in all cases it doesn't.
If the return on investment isn't there or if companies are unable to fulfil the demand then the market has failed. Recent example of this has been EVs where regulation needed to step in to force the market forward.
If there's no demand, there's no problem. Also there's no money to be made. If there's demand there will always be companies to supply that demand. Of course, it takes a time.
Politics shouldn't dictate to economy.
>Recent example of this has been EVs where regulation needed to step in to force the market forward
Then why should people be forced to use EVs instead of whatever they like? That is not freedom.
Name a free market where there is an economy of scale and network effect, which does not tend towards monopoly or oligopoly.
More fundamentally, if (say) Germany wants to move all of its government operations off of US-based IT, should it wait until the market has provided a solution? Or should it do like all governments have always done, and change the marketplace?
Nor is this unique to governments. Some of my clients require me to agree to their ethical practices, like "no child labor." They are using their purchasing power to change the marketplace.
Why do the countries with higher taxes and government regulations and policies over health care have better overall health outcomes than those with lower taxes and regulations?
There is a demand for clean beaches. Where is the free market for pollution control?
Start paying 2-300k in Europe and watch shit being built.
You can't expect to get Lionel Messi on your team with just €70k, but for €200k you get hell of a bargain.
Nobody gives their all for 5k/mo.
- Median Salary in USA: $~58k [1]
- Median Salary in Berlin: 35k EUR [2]
So while there is a difference, it is by far not as huge a gap as in tech where Europe pays ~60-70k (very and some countries, e.g. Spain or Portugal way less) and in the US 200k-300k are not unusual.
The difference is that US companies understand the huge value creation potential of tech jobs (especially over the past 2 decades) whereas most european companies think value creation comes from having middle aged balding managers.
[1]: https://www.salary.com/research/salary/benchmark/public-scho... [2]: https://worldsalaries.com/average-teacher-salary-in-berlin/g...
Please do work for US company from Europe thats great. Just lets not put it on college and your kids.
That facilitate it for other people, but not enough interest culture wide
It’s kind of interesting “why don’t we just make the same amount quarter after quarter” like, wow who knew you could do that? But speculation drives innovation. Permission to fail results in faster selective pressures.
All mainstream European politicians are in favor of more growth, more investment, more industry, more jobs, and so on, across the continent. The parties who are about "de-growth" are marginal, even as the climate crisis is on full steam.
The actual problem is lack of pro-risk capital. Almost all of Europe's capital is concentrated in 1) conservative industry giants, and 2) huge conservative pension funds.
Basically all capital in Europe, public as well as private, is risk averse. There are very few actual "VC"s. I'm not sure that's unambiguously a bad thing, but it is the difference.
This balkanization will never lead to a growth-oriented modern financial system.
Europe needs to centralize capital.
If you offer these people a good salary, tax cut and a EU passport after 4 years I suspect many will be open to move to London / Paris / Amsterdam for a few years.
Subsidise the high speed train between all these cities for 5 years, offer crosscountry startup cash and investment and you might just end up with a functioning IT sector in Europe.
The triangle London / Paris / Randstad really isn't much further apart than many Sillicon Valley HQs.
There's plenty of talent around, it just needs capital.
The cloud offered by Hetzner is the perfect sweet spot for me, but the vast majority of IT crowd and non-IT decision makers in EU want AWS-like.
But all EU alternatives that mimick AWS will be worse than the alternative.
Pretty much like wvery MS Word copycat was worse... until Google Docs shifted the paradygm.
Source: S&P CapitalIQ
The cloud side isn't polished enough to pretend to be a cloud provider.
Also they are literally called OVHcloud...
I mean, see Azure and Google Cloud a few years back. For quite a while the market was AWS, and also some joke services which nobody who wasn't required to used (notoriously, in 2012 Azure was substantially entirely down for _over a day_ due to a leap day).
https://www.theregister.com/2022/09/13/ovh_sbg5_opens/
Would love to hear about european cloud providers with comments from users.
Regardless of the attitude, I don't see this happening without some form of protectionism, trump sperging out might be the chance of a century to reboot the European military and IT industries.
They could apply Chinese policy and require foreign cloud corporations to have locally owned partners that will own the technology produced locally.
Of course, the question is very much how the courts will see ^
This feels like a misunderstanding of the situation. China used that tactic in cases where the Chinese people didn't know how to how to build or do a thing, and it would have taken a long time to rediscover. Saudi Arabia uses the same tactic for the same reasons.
Europe is full of people who know how to build a big cloud. It's not easy, and there's certainly learning-by-doing required, but as the author observes many of the people who work on the US clouds are from Europe or India or still live there. The knowledge transfer has been happening continuously since the start and in both directions.
The reason Europe hasn't produced a competitor on the scale of AWS is simply because that business model is the exclusive preserve of already large tech companies. AWS, Azure, GCP and Oracle Cloud are all the products of huge firms that already had tens of thousands of software engineers and (with the exception of AWS) pre-existing very profitable businesses. They could afford to sink vast sums of treasure into buildouts well ahead of demand, and subsidize their clouds using the other businesses until they had been able to catch up with Amazon. In addition, they all had large pre-existing tech ecosystems to leverage.
European countries have failed to produce tech companies on that scale for all sorts of well analyzed reasons. Moaning about cloud specifically is of no use, it's just a symptom not a cause. The causes meanwhile are the usual grab bag of uncompetitive compensation (a symptom of being poor, it's a feedback loop), bad laws that retard innovation and yet which never get fixed (due to the prevalence of governments that are explicitly suspicious of companies being successful), and finally the culture of US firms which is very globalist, collaborative and internally open, making them pleasant places to work for the people in Europe who have the right skills.
Look at it this way - would a skilled engineer rather work on AWS, having global impact under a global brand selling to every kind of customer imaginable and justifying its existence through technical innovation, or on an explicitly parochial "Eurocloud" whose highest dream is merely cloning what AWS was ten years ago, and which exists for no better reason than some domestic politicians being unwilling to resolve their differences with one specific US administration?
It's just a fundamentally unappealing proposition even if pay was good, therefore, it won't happen.
This may be the way to go. It seems common in countries like China, India, Brazil, ME / Gulf countries.
Tariffs are a trade disabler, so in general a loose-loose proposition.
1. Find all (e.g. LinkedIn) the EU-based engineers working or having worked for American cloud companies.
2. Offer them a proportional salary to join and start building the EU cloud product.
3. Incentivize the engineers to top-performance by giving them bonuses, stocks, whatever ...
4. Go back to the garage engineering and cut-off the bureaucratic BS with endless PMs, milestones, JIRA boards, scrum masters, chapter masters, architects, and all other similar BS.
But EU doesn't want to do it - they rather spend money in ways so that "EU funds", which are supposedly public, end up running up to their pockets directly. Dozens of examples out there but "AI factories" being the last embodiment of that.
Furthermore, this European DARPA would be an organization with its own physical structure - its own labs. Say, with each different discipline in a different EU country.