How the EU is getting the most out of emerging tech

The IT world is witnessing an ever closer convergence of cloud, edge, and AI. Collecting and processing data at the edge via connected objects is an integral part of applications for Industry 4.0, but also for things like precision agriculture, smart cities and logistics. The vast world of IIoT is closely linked to connectivity, processing data locally using AI, and then sending the information to the cloud for further analysis. From there, insights can be extracted.

“The edge is the new battlefield in the field of digital infrastructures, and its technological capabilities will be greatly accelerated and expanded by AI,” says Luis Fernandes, research director of the European infrastructure strategy area at IDC.

And the launch of DOME, a project co-funded by the European Commission to implement the open distributed market for cloud and edge services in the EU, demonstrates that this integration of emerging tech is critical for businesses and competitiveness. As a consortium of around 40 European companies and organizations, led by the Italian company Engineering, DOME creates a market for certified cloud services like IaaS, PaaS, and SaaS that are compliant with current and planned EU regulations.

And while the three-year project only launched this summer and is still in its infancy, it already contains several services that CIOs and IT managers can consult. From the beginning of next year, it’ll also be possible to purchase services directly online, and by the end of 2025, the catalogue should be as complete as possible, allowing companies and public administrations to access certified cloud and edge services that comply with EU rules and standards.

The growing role of AI in relation to cloud and edge is a big priority for the project, as well as integrating the market with other initiatives focused on building a federated platform to support the creation and delivery of AI services for enterprises and APs.

Certified services for EU companies

The European cloud market is steadily growing in terms of volume, but the market share of European cloud operators is declining, according to Giuseppe Cafiso, DOME manager and Engineering’s technical director of R&D for data and analytics, because large foreign providers are dominant, while offerings of European providers remain fragmented. “This trend is worrying the European Commission, which has launched a series of strategies to support the development of the European cloud market,” he says.

In these strategies, DOME fits at the end of the chain, at the go-to-market, where the goal is to improve capabilities of EU players. Within the cloud services landscape, edge computing, according to Cafiso, represents a major opportunity for European cloud operators, and DOME’s marketplace can make all the difference because EU operators can ensure a much broader presence at the edge than hyperscalers. DOME also certifies regulatory compliance since the EU imposes a number of restrictions on digital services offered in Europe, from GDPR to the European Cybersecurity Certification Scheme for Cloud Services, EUCS. Plus, it assesses the compliance of cloud services applying to enter the market, which makes life easier for CIOs.

“All European cloud operators are welcome to join, and are invited, but they must present a set of certifications issued by market bodies,” says Cafiso. “DOME then verifies that the certificates are present, valid, and actually apply to the proposed service. At that point, DOME issues a reusable digital certificate.”

A boost for innovation

As a catalogue of cooperating local marketplaces, DOME’s strategy means that compliant services offered by the various markets are shared in a centralized catalogue so they can be reproduced as commercial propositions, starting with the central DOME marketplace. For each seller, the checks that DOME performs for market entry and publication are the same, because the project is agnostic with respect to the sellers.

“Today, there are still many European operators that don’t sell their services online since the concept of an online marketplace for ICT services isn’t very widespread in the EU,” says Cafiso. “DOME fills this gap. There are also many startups in the sector that bring innovation and can benefit from the support of an international marketplace like DOME, where there’s a catalogue and soon also a complete online payment infrastructure.”

The marketplace is already open with several services present, like IaaS, and many offers for smart agriculture and public administrations. But the catalogue is growing and the broader it gets, the more it’ll fuel market interest.

Edge at the heart of digital evolution

Data is generated and decisions are made at the edge, says Teresa Tung, co-director of the data practice at Accenture. “For example, that’s where the automation of self-driving cars resides, or where AI orchestration takes place in a smart factory,” she says, adding companies that invest in edge as a driver of innovation, as they’ve done with the cloud recently, are going in the right direction because they can take full advantage of the potential of AI. “Although AI models are developed centrally, inference and, in some cases, training are done at the edge,” she says.

In fact, connected devices collect data, analyze it with AI algorithms, and extract trends and information from it that enable targeted and timely interventions. The data is then sent to the central cloud system that handles further processing, making the cloud, edge, and AI ecosystem increasingly integrated.

“Today, everyone is moving toward digital services based on cloud infrastructures,” says Cafiso. “Many of them also need processing at the edge. At the same time, AI is a cornerstone of the development of new digital services, and it needs cloud infrastructure.”

IDC’s Fernandes adds that AI at the edge still has a limited role, but is growing, especially in experience-related use cases. “To develop, it’ll need a scalable and standardized multi-vendor approach,” he says. “Our ‘EMEA AI-Ready Infrastructure Survey 2024’ shows that 25 to 30% of organizations adopting edge computing are using it extensively for workloads such as customer and employee experience, automation, and process optimization. The same research also brings to light the main benefits of the edge for businesses where performance, productivity, and efficiency rank first, and security, privacy, and compliance rank second.”

Market value of the hybrid cloud model

In this context, according to IDC research, companies will increasingly tend to choose a hybrid cloud model. “Our data shows a growing preference for standard shared platforms over dedicated ones for most modern workloads,” Fernandes says. “There’s also a demand for systems optimized for deployment in ad hoc environments with specific privacy and security features, and specifically designed power and cooling techniques. All of this must be part of a broader hybrid cloud environment, as four out of five respondents prefer the hybrid approach for their IT infrastructure.”

Respectful and appropriate management of customer data is an essential requirement for the development and deployment of edge-based solutions like IoT and AI. But research from Fortune Business Insights indicates the direction is one of sustained growth as the global market for AI at the edge, which combines AI algorithms in on-prem devices with edge processing capabilities, will exceed $27 billion this year and grow nearly 10-fold by 2032. The industrial segments that’ll most acquire these solutions are automotive, manufacturing, healthcare, energy, consumer goods, IT, and telecommunications, and Europe, with help from projects like DOME, represents significant influence in these markets.