Earlier this year, the European Data Act went into force. The stated goal of the Act is to set new rules that “define the rights to access and use data generated in the EU across all economic sectors and…make it easier to share data.”[1]
The Act is especially noteworthy at a time when enterprises increasingly rely on multicloud infrastructure to optimize workloads across different priorities. Ensuring the free flow of data between clouds is a prerequisite for a successful multicloud strategy, and it’s something that many businesses struggle to do on their own.
In previous blog posts, my Equinix colleagues and I have discussed how issues like unexpected cloud costs and the complexity of multicloud networking can interfere with the movement of cloud data. In turn, this limits what enterprises can achieve with multicloud. When it’s difficult or expensive to move data from one cloud to another, most enterprises simply won’t do so, even if that means continuing to use a less-than-ideal cloud solution. The Data Act could make it easier for businesses operating in Europe to overcome these challenges.
What are the requirements for cloud providers in the EU Data Act?
Article 23 of the Act states that “providers of data processing services” will be responsible for “removing obstacles to effective switching” between their own services and competing services.[2] The Act specifies that any barrier that makes it more difficult for organizations to move their data between services—be it commercial, technical, organizational or contractual—must be removed.
Thus, the Act covers common multicloud obstacles such as data egress fees that drive up the cost of switching, and others like the bundling of multiple services under the same contract. These regulations will undoubtedly create new complexity for cloud providers, and it remains to be seen exactly how they’ll respond. While the Act is now in effect, providers have until September 2025 to prepare for compliance.
At Equinix, we fully understand the importance of data mobility when it comes to helping our customers optimize their multicloud environments. For this reason, we believe the EU Data Act will ultimately be a good thing for enterprises that operate in Europe, putting them in a better position to thrive with multicloud.
That said, it’s also important to think about what the act doesn’t do. As mentioned earlier, it won’t result in immediate penalties for non-compliant cloud providers. Even after the September 2025 deadline passes, there’s little clarity about what enforcement of the new Act will look like. Some critics have argued that the Act is light on technical details, and that it fails to account for exactly how complex cloud switching can be for certain workloads.[3]
It’s also noteworthy that penalties for non-compliance are left up to individual EU member states. This means that the enforcement of the Act could look very different in different parts of the continent. Member states also have until September 2025 to inform the European Commission of the exact rules and measures they intend to enforce. After that point, the Commission will maintain a publicly available register of the different measures enforced in different countries, which will help provide clarity for both cloud providers and their customers. But until then, it’s still anyone’s guess what enforcement might end up looking like.
What can enterprises do to prepare for the EU Data Act?
If you buy services from one or more cloud providers in Europe, it’s important to be aware of the Act—both its potential benefits and its shortcomings. Like many of our customers, we’ll be watching to see what penalties are announced and how cloud providers respond. With that said, you can’t adopt a “wait and see” approach and just hope for the best. Your multicloud strategy is simply too important.
You need to be proactive, building a data architecture that allows you to use cloud services to their full potential, while also maintaining control over your data. This includes the control needed to move your data into another cloud whenever the need arises—without having to pay high fees or overcome performance bottlenecks.
At Equinix, we offer solutions to help businesses looking to ensure the free movement of data within their hybrid multicloud environments. Our customers can begin implementing these solutions immediately, instead of waiting for cloud providers to be pushed into alignment by regulators.
For instance, we can help our customers deploy cloud adjacent digital infrastructure. This means building an interconnected storage environment in locations where they can take advantage of our cloud on-ramps for low-latency connectivity to multiple clouds.
Cloud adjacent infrastructure enables companies to move data into clouds quickly to support specific workloads. Since they can maintain current copies of that data on their own storage infrastructure, there’s no risk of data getting locked into the cloud. When it no longer makes sense for that dataset to be in that particular cloud, there will be no high costs or technical limitations holding it in place.
We also offer solutions to simplify multicloud networking. For instance, Equinix Fabric®, our software-defined networking solution, now includes Fabric Cloud Router, a built-in virtual routing service. Fabric Cloud Router can support a variety of multicloud networking use cases. This includes enabling direct cloud-to-cloud routing without the latency that comes from moving traffic through a physical data center first.
Also, since Equinix Fabric is available in 55+ metros worldwide, Fabric Cloud Router is ideal for supporting hybrid multicloud environments. Customers can build an end-to-end networking solution that connects on-premises resources in different locations with each other and with multiple cloud providers.
To learn more about how the right multicloud networking strategy can help you forge ahead despite regulatory uncertainty, read our planning guide 7 key questions to ask when optimizing a multicloud network.
[1] European Data Act enters into force, putting in place new rules for a fair and innovative data economy, European Commission press release, January 11, 2024.
[2] Regulation (EU) 2023/2854 of the European Parliament and of the Council of 13 December 2023 on harmonised rules on fair access to and use of data and amending Regulation (EU) 2017/2394 and Directive (EU) 2020/1828 (Data Act), Official Journal of the European Union, December 13, 2023.
[3] Georgia Butler, EU cloud companies required to facilitate provider switching by Data Act, Data Center Dynamics, January 9, 2024.
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