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July 25, 2011

Shutl and Spotify Leading the Way for European Cloud Services

Even though data privacy laws in the European Union are a little tricky, forbidding the transfer of information about individuals outside the 27-country EU, that hasn't stopped widespread adoption of cloud computing on the Continent. Led by innovative companies like Shutl and Spotify (News - Alert), European businesses are migrating to the cloud in massive numbers.

According to research firm Gartner (News - Alert), annual sales of cloud services in Europe are expected to rise by 4.3 percent in 2015. That's a shift from $24.7 billion to $29.5 billion in sales. While sales are still only at around half the level of revenue in North America, the cloud is slowly gaining traction in Europe.

British courier service Shutl, a client of Amazon's cloud network, enables online shoppers to receive their orders within 90 minutes of purchasing. They may also select a one-hour delivery window for any point in the future, 24 hours a day, seven days a week. The company's platform connects retailers with same-day courier companies and integrates seamlessly with retailers' e-commerce platforms. Shutl organizes more than 1,000 deliveries per day using Amazon's cloud network.

Shutl recently accepted $1,058,403 in funding led by Hummingbird Ventures as well as a major European Postal Group. The company plans to build its sales team with the funds, as well as expand in-house software development and explore international business opportunities.

“Shutl has a disruptive proposition that is loved by customers and operates within the rapidly growing ecommerce market,” said Barend Van Den Brande, managing partner of Hummingbird Ventures. “These fundamentals alone are very attractive to an investor but now we also have a partner capable of truly accelerating Shutl’s market potential.”

While free music subscription service Spotify just launched in the US this month, the service has been extremely popular in Europe for several years. Based in the UK and with offices throughout Europe and now in New York, the service allows listeners to stream music from its catalog of more than 15 million tracks. The company boasts 10 million users for its free version and 1.6 million for a premium version.

Amazon has brokered cloud services deals with a number of other European businesses, including French railroad company S.N.C.F., Spanish Bank Bankinter, the European Space Agency and the Fraunhofer (News - Alert) Institute of Germany. The company has gotten around those tricky EU privacy laws by setting up a data center in Dublin, essentially moving the cloud to Europe.

“This is a tectonic shift in computing that is going to take many years to unfold,” said Adam Selipsky, a vice president at Amazon Web Services (News - Alert), the cloud computing arm of the online retailer. “Despite the challenges, on the ground, the cloud is happening in Europe.”

Selipsky said Amazon customers typically save 25 to 30 percent of costs by using its global cloud network instead of maintaining their own computing systems. According to Tom Allason, Shutl founder and CEO, Amazon's cloud services have save him around $160,000 that would be spent setting up an internal computing system. The company has used that savings to further build and expand its business.

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Edited by Jennifer Russell


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