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We take a look at some of Forrester’s top predictions for the European tech sector, including generative AI trends and cloud sovereignty.
Last year was understandably a big year for AI tech. Following the explosion of generative AI tools in 2022 – and ChatGPT in particular in November of that year – much needed discussions were had at a global level about how this technology will be used and what regulations will be needed to police it.
The EU has consistently been a regulatory powerhouse in the tech space and this has only become clearer with the growth of generative AI. Firstly, the region continues to wield the GDPR to beat-back AI-related privacy abuses and secondly, it agreed on a set of rules for its landmark EU AI Act in December 2023.
So with that in mind, what does all this mean for the tech leaders in Europe? What do senior executives need to know as we kick off 2024? Forrester analysts said companies would do well to invest cleverly in AI compliance this year and according to its research, 50pc of large European firms are expected to do just that.
Capitalise on AI compliance
According to the analytics firm’s 2024 predictions report, 84pc of AI decision-makers globally say their executives are ready to bring generative AI into their organisation and with the complexity and wider implications of the EU AI Act, which is set to be fully in force by 2025, companies can’t afford to be unprepared.
Speaking to William Fry’s Barry Scannell last year, he said that even though the EU AI Act isn’t in force yet, it’s still a good framework for companies to use for AI governance because “it catches things like risk management, data governance and things like that”.
The report also states that fines for AI-generated GDPR violations are expected to double by the end of the year. While the GDPR instrument is already there for these cases, the European Data Protection Board (EDPB) has launched a task force to coordinate enforcement actions against generative AI providers in the future, so compliance is vital.
“Firms using personally identifiable information must define their privacy risk surface and adopt best practices to ensure they treat data ethically, responsibly and compliantly,” the report said.
Non-European hyperscalers still dominate
Digital and data sovereignty has been a key goal for Europe through various instruments such as the European data strategy adopted in February 2020 and EU’s Alliance for Industrial Data, Edge and Cloud.
The EU wants to set up a certification scheme (EUCS) to vouch for the cybersecurity of cloud services, which could require non-European cloud providers to enter into a joint venture with an EU-based company.
However, the EUCS has come under scrutiny with some raising concerns that it could create a “de facto market access barrier”. Speaking to Reuters in March 2023, Matthias Bauer, director of the European Centre for International Political Economy said “the political intention is to squeeze out foreign suppliers” but that this will have ramifications for EU businesses that rely on cloud computing services.
According to Forrester’s predictions, the uptake of local approaches to data sovereignty “will be limited to the public sector, highly regulated industries and European vanity projects”. This is likely due to the fact that US hyperscalers – AWS, Google and Microsoft – continue to expand within European regions and dominate in the cloud sector in general.
In October 2023, one of the US hyperscalers, AWS, announced it was working on a new European cloud service to keep sensitive data on the continent and meet EU data security requirements.
Tech leaders need to embrace flexible working
It will come as no surprise to tech leaders that flexible working will continue to be an important trend in 2024 and one that must be embraced by executives. Forrester’s analysis suggests that 40pc of European employees will continue to work from home regularly this year.
The Netherlands leads the way in this regard, with 74pc of workers allowed to work remotely in 2023. However, hybrid working is less common in other European countries, bringing the current average to down to 30pc.
Forrester’s analysts predict Europe to outpace the US in 2024 and expect more flexible working legislation to come into force in the UK and the EU this year as well. Therefore, it is important that tech leaders keep this in mind for workplace policies and invest in hybrid collaboration models.
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