Be the authority of your digital fate – Five reasons everybody should care about digital sovereignty

Today, the French and German governments, business and science unveil details on Gaia-X – the project that aims to establish a decentralized cloud to strengthen the digital sovereignty of the European economy and society. Gaia-X tackles an issue that is currently exacerbated by the corona crisis because it accelerates the transition to digital value creation: Europe’s dependency on a small number of non-European digital platforms. However, the project is anything but nationalistic. At its core, it’s about the freedom of the internet and the open cloud. Hewlett Packard Enterprise (HPE) is actively involved in Gaia-X, as its goals are well aligned with our edge-to-cloud platform-as-a-service strategy. We see five key factors that drive the importance of this issue.

1.    It’s another fight for the freedom of the internet
 

In his “Declaration of the Independence of Cyberspace”, published in 1996, John Perry Barlow accused the governments of the industrial world of threatening the freedom of the internet. He denied the governments’ sovereignty in the cyberspace and described their attempts to wield their influence as “hostile and colonial measures,” against which “lovers of freedom” were fighting.

The lovers of freedom have temporarily lost their fight – but not against the colonial powers that Barlow described. Instead, it was the inherent logic of the internet itself that compromised its freedom: the network effect, commonly referred to with the phrase “the winner takes it all.” Today, a small number of intermediaries control a large portion of data, communication and commerce in the cyberspace.

Under these new circumstances, the governments of the industrial world are again trying to assert digital sovereignty – however, its relevance goes beyond nation-state interests. Instead, the question is whether it’s possible to create an architecture of the digital world where each and every person, organization and government is the sovereign of its digital fate.

2.    Gaia-X does not simply catch up, it takes a step ahead
 

Gaia-X is one of the most promising political digital-sovereignty initiatives of the past years. Much of the criticism that has been articulated since the project was announced in autumn 2019 has frankly missed the point. Some said it’s futile for Europe to try to catch up with the cloud giants. Others warned against isolation. But Gaia-X is open for international participation. And the project does not simply catch up with anyone, it takes a step ahead.

Gaia-X wants to create a decentralized data infrastructure that seamlessly connects consumers and providers of services and data across edges, data centers and clouds. This approach accounts for the fact that we are in a transition from a centralized to a decentralized digital world. The future belongs to decentralized cloud architectures.

Gaia-X also gives an answer to a crucial question of the upcoming digital era: how to create network effects in a decentralized world that is not controlled by middlemen, but where everybody is a digital sovereign. Gaia-X aims to regain the freedom of the internet without losing the benefits we’ve achieved over the years.

3.    Every enterprise becomes a cloud
 

Data increasingly is the core of value creation in all industries. As a result, data must be considered a corporate core competency that cannot be outsourced without losing control of an organization’s business model.

This doesn’t mean confusing sovereignty with self-sufficiency. The key point is not who runs the IT, or if technologies are made or bought – but rather the bargaining power of the digital suppliers. For example, they have immense power if very few of them control the market, and especially if switching costs are high. This scenario can have severe negative effects both on businesses’ sovereignty and margins.

By contrast, in a decentralized digital world, every market participant is both provider and consumer. This means every enterprise becomes a cloud in the sense that it sells data and digital services to its customers – with that, it becomes a sovereign in the digital economy.

4.    Data sovereignty must become data-monetization sovereignty
 

From now on, the global data volume will double every two to three years – and the majority of this data will not be created in clouds and traditional data centers, but in factories, vehicles, transport routes and cities. Physical infrastructures become the digital “platforms” of the 21^st century.

This data is mostly under the control of the enterprises that build and run these infrastructures – and it has enormous value. As an example, the data of connected vehicles has been forecasted to have a monetary value of US$ 750 billion by 2030.

However, to seize this opportunity, it’s crucial that companies not only control their data, but also control its monetization – the data-driven business models that drive revenue and margin. This is the real meaning of the term digital sovereignty for any enterprise.

5.    The future of cloud is open
 

We can shape an architecture of the digital world where each and every one of us is sovereign. This is the logical next step in the evolution of the digital world. The history of IT has been, among others, a sequence of gradual liberation of applications from the platforms they are running on – from the hardware, the operating system and finally from the entire operating environment. What remains is the dependency on the respective cloud platform.

But it’s foreseeable that this last barrier will be removed. For example, a range of projects within the Cloud Native Computing Foundation is working toward this goal. They want to enable any service to interoperate with any other service in a seamless and completely secure way, regardless of on which platforms those services run – in a cloud, at the edge or in a data center. This would be the step towards a truly open, federal cloud – with far reaching positive consequences for fair competition, digital sovereignty and innovation.

It is evident how these efforts dovetail with HPE’s strategy to enable a consistent and seamless experience across all clouds and edges – so customers can unlock value from all of their data, regardless where they reside. That’s why we will provide our entire portfolio as a service by 2022. And that’s why we are engaged in Gaia-X and many other projects that pursue similar goals. This will help enterprises to be the authority of their digital fate – and it will make the digital world a better place for everyone.