France, Germany step up effort to build rivals to U.S. cloud firms

FILE PHOTO: French Economy and Finance Minister Bruno Le Maire shakes the hand of German Minister of Economy and Energy Peter Altmaier before a meeting on the development and production of European batteries in Paris, France, May 2, 2019. REUTERS/Benoit Tessier/File Photo

PARIS (Reuters) - France and Germany are stepping up efforts to foster homegrown rivals to U.S. tech giants Amazon and Microsoft in cloud computing, according to a joint statement by the countries’ finance ministries issued on Tuesday.

Amazon, Microsoft and Alphabet’s Google dominate the field of data storage worldwide, with a combined market share of more than 50%, according to market research.

This dominance is raising concerns in Europe that sensitive corporate data could be spied on in the wake of the adoption of the U.S. CLOUD Act of 2018 and in the absence of any major competitors, with the exception of China’s Alibaba.

Amazon’s cloud division has a $600 million contract with the CIA, while Microsoft recently won a $10 billion cloud computing contract with the Pentagon.

“We want to establish a safe and sovereign European data infrastructure, including data warehouses, data pooling and develop data interoperability,” French Finance Minister Bruno Le Maire said in a statement.

Le Maire’s German counterpart, Peter Altmaier, also cited the need to “regain our digital sovereignty.”

The two governments pledged to hold a workshop before the end of November. The aim is to present proposals for a “European data infrastructure” in early 2020, according to the joint statement.

The initiative follows a call that Le Maire made earlier this month to French tech companies Dassault Systemes and OVH to come up with plans to break the dominance of U.S. cloud computing firms.

Previous French government-supported attempts to build a so-called “sovereign” cloud to store the most sensitive data held by companies and states failed.

Reporting by Mathieu Rosemain; Editing by Mark Potter