Market Intelligence
Cloud Computing Austria

Austria Cloud Computing

A recent survey about cloud computing in Austria offers valuable takeaways for U.S. vendors.

A survey of 252 Austrian companies, conducted in June 2020 by KPMG in cooperation with Bitkom Research, showed that it is no longer a question of whether cloud computing should be used. The key point in Austria now is how cloud solutions can be integrated into existing IT infrastructure with guaranteed security. Cloud computing increasingly forms the basis of IT networks and enables the digital transformation particularly also in the field of Industry 4.0. While somewhat slow adopters in recent years, Austrian businesses are increasingly converting to cloud solutions to retain their long-term competitiveness.

Survey Highlights

  • 47% of companies with 20 or more employees in Austria work in the cloud. In comparison to Germany (76%), the Austrian market holds great growth potential. Many companies are expected to switch to cloud solutions in the medium-term.
  • One-third of Austrian companies use public cloud computing. The market leaders in public cloud services are by far American.
  • Only 18% of Austrian companies with 20 or more employees are using multi-cloud solutions. For companies with 250 or more employees, the figure increases three-fold to 54%.
  • 81% of users view cloud solutions as a large or very large contributor to their company’s digitization strategy. Cloud applications range from internal process management to the development of digital business models including cloud-based IoT, AI and voice recognition applications.
  • For 98% of Austrian companies, conformity with the EU General Data Protection Regulation (GDPR) is the most important criterion in selecting a cloud provider.
  • 93% of public cloud users and IT decision makers stated that transparent security architecture, controls, and security-specific service level agreements are must-haves when choosing a provider.
  • 68% of cloud users have experienced problems with public cloud integration, particularly with implementation of cyber security and compliance requirements, unauthorized data access, and legal uncertainties
  • 58% of cloud users have already developed security concepts for all or at least selected cloud scenarios.
  • 57% of public cloud users apply these solutions to critical applications and workflows. Two out of five companies store business-sensitive data in the cloud.
  • On average, 18% of corporate IT budgets were spent on public cloud solutions. The majority of those integrating cloud solutions reduced their overall IT costs.

Additional Key Findings & Best Prospects for U.S. Companies

  • According to Statista Research, the overall Austrian cloud services market grew by 6% in 2019 with similar growth projections through 2021 and the market aiming to increase the share of cloud adoption among companies in order to catch up with leading markets like the U.S., UK and Scandinavia.
  • The current pandemic has accelerated the move to the cloud across a range of industries, including retail and government, in order to prepare for future COVID-related shutdowns. However, industries such as manufacturing and tourism sectors that were heavily impacted by decreasing orders, smaller budgets and short-time work, slowed down their move to the cloud.
  • Cost pressure to lower IT capital expenditures and overhead, the lack of skilled IT professionals and focus on core company business are further drivers for increased cloud adoption.
  • Infrastructure as a Service (IaaS) combined with regional data centers, a strong security and scalability continues to show particularly strong growth potential.
  • Another growing segment is Software as a Service (SaaS) including ERP, CRM and cloud file sharing solutions. Frictionless integration, user friendliness and strong security/data encryption are essential.

Market Entry Strategy

  • U.S. cloud solutions providers interested in the Austrian market can best position themselves by selling through an established, qualified local channel partner such as a reseller, value-added distributor or systems integrator. These channels offer a low risk market entry for most U.S. manufacturers.
  • In some cases, an existing partner in Germany can cover the Austrian market. Establishing a direct business presence in Austria is the best strategy for U.S. companies pursuing a) national projects with the Austrian government, b) projects with larger professional integrators.
  • Austrian client’s most critical cloud solution selection criterion include the provider’s full compliance with EU and industry-specific standards/regulations, as well as their use of secure data centers within the EU region.
  • Some U.S. companies may choose to partner with U.S. or other international integrators already established in Austria.
  • Most Austrian business partners are fluent in English, but the majority of local trade shows, conferences and industry publications are in German. It is therefore recommended to translate and adjust marketing materials including references to the Austrian market.

To find out how the U.S. Commercial Service can help you enter the Austrian market, contact jan.bruckner@trade.gov

10/22/2020