The European Data Flow Monitoring

Analysing, mapping, quantifying, and monitoring the volume of cloud data flows and their associated economic values within and outside of the EU in the area of cloud and edge computing is fundamental to supporting decision-making, industrial choices and investment decisions. It is also key to assessing the competitiveness of the European digital economy based on the analysis of data flow patterns and to monitoring the movement of data against the free flow of non-personal data principles across the EU economy. Knowing the volume and value of enterprise cloud-based data flows will also help to achieve the Cloud and Edge Digital Decade's targets by 2030.

To provide economic intelligence in data flows in the area of cloud and edge computing, the Commission created a Cloud Data Flow Strategic Visualisation Tool.

The tool allows the Commission to:

1. map and estimate the volume and economic value of enterprise cloud-based data flows (ECBDFs) generated by EU Member States and by Iceland, Norway, Liechtenstein, Switzerland and the United Kingdom since 2016;
2. map and estimate the destination of these flows, distinguishing between ECBDFs flowing within the country of origin, ECBDFs flowing to other European countries and ECBDFs flowing to non-European countries;
3. forecast the volume and economic value of ECBDFs up to 2036;
4. analyse the volume and economic value of ECBDFs broken down by sector and enterprise size band;
5. breakdown of the economic value of ECBDFs for enterprises, Cloud Service Providers and for the wider society in terms of externalities (i.e., greenhouse gas emissions and job creation).

The map and graphs provide comparative country data flow and outflow forecasts from 2016 up to 2036 where data are available.

Cloud Data Flow Strategic Visualisation Tool comprises data from a total of 32 countries in Europe. It will be used to monitor data flow trends including volumes and their economic values within these countries. It also presents data on cloud uptake per sector, country and company size up to 2036. The tool can also be useful as strategic foresight instrument to support future decision-making, trade and investment decisions in cloud computing based on data flow evidence.

The methodology underpinning the tool is enhanced in 2024 to include:

• an updated methodology to estimate the volume and destination of ECBDFs flowing to main and edge cloud facilities in European countries, based on new or updated data sources and including a variety of sensitivity analyses of key assumptions;
• an updated methodology to estimate the volume and destination of ECBDFs flowing to main cloud facilities located in non-European regions, using publicly available information on submarine cables and intercontinental connecting infrastructures as well as public information on the location of extra-European main cloud data centres operated by major cloud providers;
• an analytical framework based on economic theory that allows the quantification of the economic value of ECBDFs. This framework enables the estimation of the economic value of ECBDFs from the perspective of three economic entities: enterprises using cloud services, providers of cloud services and the wider society (i.e., greenhouse gas emissions and job creation);
• an estimate of the economic value generated by cloud service usage.  

These methodological enhancements are described in the 2024 report: “Data Flow and Economic Value EU Framework: Modelling Update and Data Collection A report by Frontier Economics” [add hyperlink].

Background Information

In 2019, to build the European Data Flow Monitoring, the Directorate-General for Communications Networks, Content and Technology (CONNECT), in collaboration with the Joint Research Centre launched a first company and public entity voluntary survey (now closed) to gather aggregated and anonymised data on:

• the amount of data stored within cloud infrastructures by companies and public entities within the EU (i.e. data stocks);
• the volume of data moved from one cloud infrastructure to another across the EU.

The 2020 European Strategy for Data recognised the strategic importance of gaining economic intelligence on data flows and so developed a Data Flow Strategic Analytical Framework. The Commission conducted three studies to deliver on this key action: ‘Mapping Data Flows’ and 'Economic Values of Data Flows'.

The first study develops and tests for the very first time a new, self-sustained and replicable methodology to quantify volume of data flows.

The second develops a first of its kind Analytical Framework to measure the economic value of data flows.

The third study is the first piece of research to explore in detail ECBDFs that flow to non-European countries and provides a new and innovative way to isolate the economic value of ECBDFs from the value of cloud services more generally. As mentioned above, this report includes the first conceptual framework focused on the economic value of ECBDFs specifically and based on economic theory.

These reports aim to inform the EU’s industrial strategy and digital and data policies at large, including: the assessment of two of the EU’s Digital Decade targets (the percentage of enterprises using cloud services, and the number of edge nodes deployed); and the upcoming evaluation of the EU Regulation (2018/1807) on the Free Flow of Non-Personal Data. The analytical framework and economic modelling could also support future decisions on investment in cloud and edge computing capabilities and the governance of international data flows.

The online data visualisation tool allows to geographically see online the countries and economic sectors that trigger enterprise cloud-based data flows (ECBDFs). It also allows for the analysis of cloud data flows and their associated economic value per sector, geography and enterprise size across a total of 32 countries in Europe and shows forecasts up to 2036 of cloud uptake, volume, destination and value of ECBDFs per sector, geography and enterprise size. For economic value specifically, the tool also shows a breakdown by cloud service types, distinguishing between the economic value generated by ECBDFs triggered by the use of basic services and those triggered by the use of intermediate/sophisticated cloud services.