European cloud market grows – and US providers benefit

The European cloud market grew to 61 billion euros in revenue in 2024 , a significant increase on the previous year's figure of just under 50 billion euros. The market volume has even increased sixfold since 2017. However, European cloud providers have only been able to benefit from this growth to a limited extent: Although they tripled their revenue in the same period, their share of the market fell from 29% to 15% at the same time. These figures come from a recent survey by Synergy Research.

SAP and Deutsche Telekom in the lead

The US competition is in a much better position: Amazon, Microsoft and Google dominate the European cloud business with a share of 70 percent. Among local companies, SAP and Deutsche Telekom are the largest providers, each with a share of two percent. They are followed by OVHcloud, Telecom Italia and Orange. Alongside the UK, Germany is the largest cloud market in Europe, with Ireland, Spain and Italy showing the highest growth rates.

Between 2017 and 2022, the share of European providers fell significantly and has since leveled off at 15%. According to the data from Synergy Research, the current discussion about digital sovereignty – 2025 does not appear to change the division of the market. The market researchers are predicting renewed growth this year: revenue is set to increase significantly again by 24%.

John Dinsdale, Chief Analyst at Synergy Research, sees European providers in a difficult situation: the investments made by US hyperscalers are too high for local competitors to seriously challenge their dominance. As a result, European cloud providers are focusing on local customers with specific needs. Many of these providers could continue to grow, but this is unlikely to change their share of the market.

Future in the AI niche

Amazon, Microsoft and Google are currently investing heavily in Europe and advertising with promises of sovereignty. And SAP CEO Christian Klein only spoke out against direct competition at the beginning of June: Competing with the US hyperscalers is crazy, he said. Building new data centers with EU funding is a completely wrong implementation of sovereignty. Instead, the focus should be on AI for specific industries and special applications – and this is precisely where Synergy Research sees particularly high growth of 140 to 160 percent.

Details on the latest figures from Synergy Research can be found here.

(fo)