Digital Single Market
Digital Economy & Society

Final Report of the study "SMART 2013/0043 - Uptake of Cloud in Europe"

Article
This study provides quantitative estimates of the impact of cloud computing on the EU economy by 2020. The study looks at the potential economic impact that the adoption of cloud-based computing solutions by the public and private sector could have on EU economy as a whole.

Such cloud solutions include document sharing and management, customer relationship management or even cloud-based e-mail services. The study has found that, from 2015 to 2020, cloud computing could add a cumulative total of €449bn to the EU28 GDP (incl. the public sector), of which €103bn of net new GPD in the year 2020, representing a share of 0.71% of total EU GDP, more than 3 times the share represented in 2013. Between 2015 and 2020 approx. 303,000 new businesses will be created, particularly SMEs, thanks to the availability and adoption of cloud-based computing. Moreover, 1.6 million jobs should be created overall from 2008 to 2020, of which almost 1 million jobs will be created during 2015-2020. The total value of the cloud market for the EU in 2013 was estimated at €9.5bn, less than 3% of the overall IT budget of the public and private sector in the EU. This value is expected to grow to €17.2bn by 2015 and to €44.8bn by 2020, i.e. almost five times the market size in 2013 and over 10% of the forecasted IT budget in 2020.

The study examined three scenarios: a "baseline" (most likely) scenario, an "optimistic" (best case) scenario) and a "pessimistic" (worst case) scenario. It also provides updated data of cloud adoption in the EU by industry, business size, and country. Moreover, it estimates the level of replacement of IT expenditure by expenditure on cloud services. It was found that cloud replaces other spending on IT systems and services. For example, adoption of SaaS (Software as a Service) cloud services removes the need to buy software and servers. In fact, every €1 spent on SaaS is replacing €2.30 of expenditure that an organisation would need to spend to achieve the same result through a traditional solution. Finally, the study looks at how competitive the EU-owned IT industry is in meeting the demands and opportunities that cloud computing presents.

The results of this study have fed into the Commission's strategy for a Digital Single Market, that was announced on 6 May 2015.

The study was carried out for the European Commission by IDC from January 2014 to November 2014. This is a follow-up study a 2011-2012 IDC study on "Quantitative estimates of the demand for Cloud Computing in Europe and the likely barriers to take-up".