Cloud credits, the trap that locks French startups into one service provider

American Cloud providers know how to attract French startups by offering them favorable Cloud credit, i.e., by providing them with accessible services free of charge for a certain that period of time. This facilitates their development, but in the long run, young companies are locked into suppliers. It is no longer possible for them to change technology and prices are rising.

Cloud credits at the heart of the debate for Scaleway and OVH

It was criticized by two French Cloud providers, Scaleway, a subsidiary of Iliad and founded by Xavier Niel, and OVH. Yann Lechelle, general manager of Scaleway, claimed the cancellation of these Cloud credits. Caroline Comet-Fraigneau, Vice President France, Benelux and Africa of OVHcloud, calls for the establishment of a fair framework at the European level. They spoke on the day of the Think Tech Summit, organized by La Tribune, on March 28th.

“The real issues are when there is lockout through cloud credits, which creates negative prices, and checkout fees

Today, we focus on the real challenges of multi-Cloud, the real challenges of reversibility said Yann Lechelle. ” Theoretical reversibility is nice, but the real issues are when there is locking through Cloud credits, which creates negative prices, and checkout fees. [NDLR : frais de sortie] which prevents the output of data from a given actor instruction of the manager. For Yann Lechelle, it is necessary to conduct lobbying at the level of the European Commission. ” This requires active lobbying, going to the European Commission to explain these mechanisms, and to create a truly European competitive field, which will ultimately allow reversibility he describes.

These Cloud credits are also offered by French service providers. ” We are obligated. Startups without cloud credit tell us I can’t start my project. How much will you give me? reaction by Yann Lechelle. Cloud credit can be 6 months to 1 year, up to $ 100,000 or more, he says. But when a company commits to a Cloud for a few months, there is little chance of it leaving because its software has become captive. ” Obviously in IT when you engage in a project you start to build an architecture, well when you have used the service for 6 months or 1 year, it is too late. he studies. ” There is no reversibility from an architectural point of view, because the startup gallops, it has no time to go back. This type of mechanism is similar to a shot of hard medicine. We can’t go back. So these Cloud credits must be negative, finally canceled he asked.

Startups have been in a race for hours

At OVH, we confirm Scaleway’s review and the possible confinement to a supplier. ” We all have a support program for startups. It would be nice if it all had a framework, to be fair reflects Caroline Comet-Fraigneau of OVHCloud. ” I had the opportunity to talk to several startups. At first, they knew these reversibility issues but they were in the race of time manager’s comment. ” They tend to use a range of proprietary features and tools offered by Gafam. And once they have built their platform, it will be very difficult to move to another environment. he understands.

“Once they’re locked in, prices will go up and technology changes will be very difficult”

It also requires a regulatory framework to be put in place. ” This is why we need to manage to expedite all of these reversibility issues so that technologies are open and advance the freedom to switch suppliers. Several SaaS providers [NDLR : fournisseurs de logiciels accessibles depuis le Cloud] realizes that a lot of value is captured by a number of cloud providers. And when they are locked in prices go up and changes in technology are very difficult ” he says.

The Vice President emphasizes the OVHCloud strategy, which is the use of Open Source to promote reversibility. ” We promote the fact of using as many Open Source type solutions as possible, we use OpenStack for our public Cloud, or solutions that can be ported to other environments. We want startups to start with trusted and sovereign solutions he continued.

Three quarters of new technologies in France are developed on AWS

American suppliers are getting the most out of new software developments, according to Scaleway, which indicates that 75% of French Tech’s technologies are on AWS (Amazon Web Services). ” Our unicorns, the future of French technology built on a low layer, which draws most of the value in the long run, will directly feed into the funds of the players who are already dominant. This phenomenon should be reversed. How do we rebalance all this, so as to have more sovereignty, more value -added local job creation and more local control? Liberal protectionism must be implemented in Europe as the United States does »Concludes Yann Lechelle of Scaleway.

“JI’m not going to go so far as to call Cloud Credits a hard drug. You need to have some reason for this type of subject

The clear positions of Scaleway and OVH contrast with Orange’s more blurred vision, getting the impression of trying to save the goat and the cabbage as much as possible, i.e., the dangers and opportunities. Can we qualify for Cloud credits offered by hard drug providers? “JI’m not going that far. You need to have some reason for this type of subject ”Replied Cédric Parent, deputy general manager of Cloud activities, at Orange Business Services, who addressed Scaleway at the same round table.

The Deputy CEO who manages Cloud and Orange Business Service considers that reversibility and the removal of a supplier’s locking, ‘vendor locking’, is a practice challenge. ” Back and forth, we all agree that it is very important to avoid vendor locking. This is at the heart of our approach in any case he started. ” There are technologies that allow you to do this, which are less simple in reality than they are on paper, such as ‘containerization’ and all the technology around Kubernetes. Our role is to help customers move from one technology to another, whether for functional, legislative, latency, security, negotiation or resilience issues. he concludes.

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