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While some questions remain unanswered, such as how the allocated funds will be invested, the initiative is an important step and a further step towards reducing European fragmentation, including in terms of innovation. In addition to infrastructure, the debate on data governance is also on the horizon.

IPCEI is the next big cloud project driven by the EU, the last being GAIA-X in which the Europeans wanted to establish a federated and secure infrastructure. This project was proposed in 2019 and work is ongoing.

From a technical standpoint, we see two types of cloud infrastructure that’s built to agreed standards, just like any other environment, to create a shared data pool. The complexity is that it must be built to a very prescriptive set of standards and certified as compliant (a reference architecture), so many firms will need to adjust their own standards to meet this criterion for both their GAIA-X and upcoming IPCEI qualified deployments, including in the case of GAIA-X in their use of cloud providers such as Microsoft, Google, AWS, and for IPCEI focused on local service providers. On the surface, for every other organisation, it’s just like provisioning any other cloud environment.

It will be interesting to see how technically GAIA-X and IPCEI will interact and what design principles will be enforced. Gaia-X is a cloud within a cloud that’s designed to provide guaranteed compliance with European data-sharing laws and regulations, to ensure Digital Sovereignty. It could solve many problems in the data exchange with IPCEI-based environments because it enables organizations to share data internally and externally between offices and cloud infrastructure in different European countries and even with offices located outside of Europe. Think of the impact of Brexit on UK financial institutions that moved out of London to Dublin or Frankfurt because of data regulations, Gaia-X would have enabled a compliant way of data sharing across borders without them needing to move their headquarters. IPCEI could provide the same outcomes using local service providers in region, rather than hyperscalers.

Mark Molyneux, EMEA CTO at Cohesity says: "With this initial project to implement an open source reference infrastructure, we are witnessing an attempt to create a standard that could become the basis for innovation for Member States and public and private sector companies. Once this essential step has been taken, it will be possible for European organisations to offer services that are respectful of citizens and their data, compliant with regulations, and with governance that takes account of local specificities and data protection, while supporting the innovation potential of the digital industry and its role in the economic development of our societies."

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*As a reminder, the IPCEI CIS plan involves 19 companies, including Atos and Orange, and seven Member States: France, Germany, Hungary, Italy, the Netherlands, Poland and Spain. The participating Member States will provide up to €1.2 billion in public funding, which should unlock a further €1.4 billion in private investment, bringing total investment in the project to around €2.6 billion. The French government plans to provide €300 million in funding for French projects as part of PIA 4 and the France Relance plan.