The common view of cloud adoption in Germany goes something like this:
"Germany is a conservative, privacy-focused country. We would prefer to say ‘I told you so', rather than get burned ourselves."
Hardly words to suggest that Germany is at the forefront of global cloud adoption.
And yet, numerous signs now indicate that is the case. This year, Germany beat 23 other leading economies - including the US and the UK - in a Business Software Alliance study assessing preparedness for cloud growth.
We've pressed the German bosses from the industry's top public cloud vendors on what their strategies are, and asked cloud brokerage firms and German VARs to highlight the specific opportunities for the channel to profit.
How the strategies of the top public cloud vendors differ
The unanimous response from execs we've interviewed is that perceptions towards cloud in the German market started to shift two years ago.
One federal initiative was the Cloud Computing Compliance Controls Catalog (C5) certification, which was mandated by the German government in 2016. It set a minimum baseline of data transparency and security for the public sector adopting public cloud solutions.
Azure's Germany boss Oliver Gürtler claims that it was also Microsoft's innovative "data trustee model" that helped open the flood gates for cloud in Germany.
Since 2015, Microsoft has partnered with Deutsche Telekom's T-System's to act as a local go-between for customer data stored in two datacentres in Frankfurt and Magdeburg.
The idea was to allay German fears about US government agencies snooping.
"Our system opened up the market here for cloud. It was a fantastic trigger for customers to bridge their emotional feelings about security," Gürtler said.
However, local media criticised the model, pointing to high costs and a reduced access to services.
Gürtler conceded: "All new services that we develop are first cascaded to the global datacentres, then they go to local datacentres, then to constructs like the system we have in Germany. It's so protected that even the system updates are done by T-Systems. The service availability is not the same - that is the trade-off customers decide on."
Cue Microsoft's announcement this spring that it would open two new datacentres to be run solely by the software giant itself.
The "significant investment", which is reported to be as high as €100m, will mean the country will have four Azure regions.
Gürtler would not reveal an opening date, but said the development indicates that Microsoft sees a rapidly growing market in Germany.
"Germany has a worldwide leadership role in some industries, especially the automotive, manufacturing and chemistry sectors," he said.
"In manufacturing in particular, there is IoT, so many of the German Mittelstand (SMEs) and enterprises are world champions in exporting these goods and services. If we can win and help these customers to transform successfully, it will have a global impact."
"Ultimately, we see value in continuing to offer customers the choice of both models."
It's not a view that is shared by rival IBM.
Big Blue's VP of cloud and cognitive is Yasser Eissa.
"Microsoft's data trustee model is interesting but I think it is more marketing than reality" he said.
"Enterprises have told me that they don't like having two contracts and that is what is necessary there."
"For us, if an incident happens and access is requested from outside the EU, we notify the client and ask for their approval to grant this access temporarily. Microsoft and T-Systems are not involving the client at all. T-Systems makes the decision. Our clients really like that they are the ones who get to say yes or no."
He added: "Our strategy is also very focused on providing hybrid solutions. We see that German companies - although recognising that cloud is when, not if - are not migrating their whole workloads, data and apps into public cloud.
"Not all the other big players can completely provide this."
Recognising the demand from German enterprises for hybrid options is echoed by AWS.
As of June, VMware became available on AWS Europe's Frankfurt region (one of three in Germany), giving customers the ability to move apps in and out of the public cloud.
AWS Germany channel boss Peter Prahl said that to get to this point, the firm also had to spend years "educating customers" to reassure them that data security is possible with an American public cloud behemoth.
"Our partners are now telling us that there is a turnaround in perceptions towards AWS with regards to data security. Indeed, our overall partner business is growing steeply 129 per cent year over year.
"Our VMWare partnership is being welcomed by customers because it helps them build hybrid infrastructures. There is plenty of demand in Germany around virtualisation technology and we are providing the means to enable this seamlessly."
The view from integrators and security specialists
Despite the top vendors singing from the same hymn sheet insisting that cloud is secure, some are still seeing lingering hesitancy from German customers.
Armin Simon manages the German business for security firm Gemalto, headquartered in neighbouring Holland.
"In the beginning of the cloud business in the German market, it was really conservative. People didn't like to adapt it, saying ‘cloud is evil, don't do it.' Especially around the Snowden publications [of NSA files in 2013].
"It's true that this has changed a lot, and has moved towards an open minded approach to cloud.
"However, it is typical for Germans to make a meticulous plan and then execute it. A high security awareness is still a major point of view here.
"Companies need to be innovative to persuade German firms that their data is protected during digitisation projects.
"Microsoft is really pushing the market like hell with this; pushing customers into the cloud. Yet, most don't think that there is a cost benefit to move into the cloud. It's about it being faster to use cloud services rather than on-prem."
London-based global cloud services company Cloudreach currently enables customers to migrate to Azure and AWS, and is looking into first joint activities in Germany with Google Cloud and Alibaba.
"AWS' Frankfurt cloud region has helped a lot with driving cloud adoption," said its head of sales for DACH and France Ralf Schaefer.
"We're not ‘all in' like in the US. We have more of a staggered approach. But in Germany, we are of course driven by global competition. One of the early adopters of public cloud here was the automotive industry. Why? It's not typically seen as an early adopter of IT.
"You look at that industry and it is getting much more competitive with IT solutions. Many people speak of cars as being more of a device moving forwards...I think that very global pressure in how the next generation sees the industry is key.
"I still think the big uptake is still to come. The pace is accelerating but it is still small compared to the UK or US market."
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