Among the various effects of leave, some are closely linked to technology. The dream of a single digital market and of a more integrated data economy at EU level really risks fading away for good, while the United Kingdom faces the need for a new national IT infrastructure.
What will happen in the IT world?
What possible scenarios could the European Cloud Computing market face?
And what could the repercussions be for the main global providers such as AWS, Google, Microsoft and IBM?
The United Kingdom has always been one of the best-known strategic hubs for Cloud Providers seeking to enter Europe.
In recent times, in fact, the Cloud giants have strengthened their presence in the area, renting space in data centres, such as Equinox, or building their own infrastructure directly.
Brexit will bring new regulation for Cloud providers, different from the current one, which will translate into additional costs for the top players. For this reason, all future investment plans and projects concerning new data centres will be put on standby or redirected to safer destinations such as Ireland, the Netherlands and Germany.
Indeed, it could be Ireland that takes Britain’s place, becoming the new “promised land” for financial and ICT-related activities.
Various scenarios are emerging. Among the most unlikely is the disappearance of the euro, which would give way to national currencies. A scenario that would be very difficult for providers to manage. But this is currently one of the most implausible “projections”, not least because the break-up of the Union will not happen overnight: all countries are still waiting to see what will happen to England before acting accordingly.
And what about the European rules on privacy protection?
For the United Kingdom, leaving the Union also means abandoning the European regulatory framework on privacy and data processing. In February, the new agreement between the United States and Europe was announced (the “Privacy Shield”, which replaces the defunct “Safe Harbor”) on how users’ personal data may be transferred overseas and on the safeguards to be respected by the US government and American intelligence services. There was talk in this regard of a “European standard”, at a time when the United Kingdom was an integral part of the EU.
If large British companies are obliged to store and process information locally, business opportunities for IT vendors will increase accordingly.
Managing data on a national scale will also have a considerable impact on the overall costs of implementing the IT and technology infrastructure required to do so. A constraint which, according to some, will also penalise startups that have not yet equipped themselves to reconfigure their systems in view of the growing isolation of large volumes of data.
As reported by the Financial Times, the emergence of national IT markets and ecosystems rather than individual regional infrastructures would make it difficult for European tech companies to grow to the point where they can compete on an equal footing with American companies and Chinese giants.
