Tech giants warn Europe of cloud service withdrawal costs

A recent report from the European Centre for International Political Economy (ECIPE) highlights that Europe may incur exorbitant costs if it decides to forgo cloud services from U.S. tech giants. The estimated figure is €115 billion over the next decade, coming from the Computer and Communications Industry Association (CCIA), which represents companies like Amazon and Google.

This study is set against the backdrop of the European Commission's proposal for the Cloud and AI Development Act (CADA), aimed at reducing reliance on foreign tech vendors. However, the report suggests that the Commission's cost estimates are significantly lower than reality.

## Why it matters The warning from tech giants underscores the complexity of migrating to local alternatives and the costs associated with such a transition. While Europe's intent to strengthen its digital sovereignty is valid, the challenge lies in balancing that goal with economic and operational feasibility.

## What we know The CCIA argues that pro-European restrictions could lead to increased operating costs and migration complexity for businesses. The figure of €115 billion comes from an analysis considering multiple factors related to the adoption of new technologies and changes in existing infrastructure.

## What remains unclear It remains unconfirmed whether the European Commission will reconsider its estimates in light of this new report. Additionally, it is unclear how the CADA policies will be implemented without significantly impacting businesses that rely on U.S. technology.