Cloud and data infrastructure has quickly developed as an important and widely debated topic within the global development agenda, with countries around the world facing a significant shift in the digital data ecosystem. The recent World Development Report 2021 highlights how data is an asset holding enormous value for development, and therefore the storage, processing and accessibility of data are all essential elements to realize this value. Consequently, the decisions governments make, and the data models they choose, affect not only the lives of citizens and the private sector, but can also impact progress towards Sustainable Development Goals (SDGs).
To better understand different perspectives on cloud architecture and data policy from key stakeholders including governments and cloud providers, The World Bank’s Digital Development Global Practice hosted a discussion series regarding ongoing debates around three critical themes: data sovereignty vs transnational data flows; public vs private cloud including hybrid options; and vendor lock-in vs interoperability. Government and country representatives from Israel, Moldova and Rwanda shared their cloud journey stories, along with representatives from Amazon Web Services (AWS), Microsoft and Google Cloud teams who shared their respective visions of enabling policies and digital ecosystems to improve commercial cloud integration.
On the first theme of data sovereignty — and perhaps one of the most debated topics in this area — important considerations for governments include the privacy laws of the countries where data is stored, the amount and degree of confidentiality of government data needed, the accessibility of data by foreign governments and the pathways of internet connectivity between a country and the outside world. A lesson learned from Israel’s cloud migration is that governments need to think strategically about real-world political trends driving digital sovereignty more broadly, including economic uncertainty, institutional distrust, political turbulence and divergent policies on technology regulation. While the idea of data localization may seem attractive to facilitate greater control, decisionmakers should consider the potential downsides of broad application including weaker security , an undermining of data portability and interoperability, limitations for business continuity and critical networked services like disaster recovery and finally a competitive disadvantage to local business. Furthermore, traditional justifications for data localization can be flawed because other parties can still gain access to data regardless of location.
To help distinguish between different types of digital sovereignty, Google developed a helpful three-pillar framework: 1) data sovereignty, where there is control over encryption and access to data; 2) operational sovereignty, where there is visibility and control over provider operations; and 3) software sovereignty, where workloads can run without dependence on a provider’s software. Consideration of these pillars can help governments work with cloud providers to optimize functionality and cost.
This de-coupling of data sovereignty and operational sovereignty is helpful for understanding the mechanisms of vendor lock-in, another key debate in cloud infrastructure. Cloud vendor lock-in refers to when a customer faces significant barriers to switching to other cloud providers or related products and services due to financial pressure, time, inconvenience or possible interruptions to operations. This could force a customer to remain with an inferior product or service that no longer suits their needs. Cloud interoperability is one design feature that can mitigate vendor lock-in by enabling different cloud providers and proprietary systems to interact and communicate, facilitating multi-cloud solutions.
Rwanda’s cloud migration journey has indeed arrived at this multi-cloud approach, after first beginning with a private cloud and subsequent hybrid cloud model. While multi-cloud solutions have many advantages for governments, an important lesson from Rwanda was that transitioning to a multi-cloud environment can be very challenging in countries or regions where there is limited knowledge or skills to manage cloud systems. Therefore, local digital skills development should be considered alongside cloud infrastructure development to facilitate local participation.
The third critical theme in cloud infrastructure that governments need to consider relates to public vs private models. Public cloud services are open to multiple customers, while private clouds are not shared, and consequently more expensive in terms of both capital and operational expenditure. These high costs have contributed to a growing trend of hybrid cloud solutions, which enable customers to integrate with — and benefit from — features of both models. Such advantages include greater agility and risk mitigation, faster migration, lower costs and a more attractive return on investment. While hybrid models and multi-cloud approaches have much to offer, governments in developing countries should evaluate these factors within their own national contexts to determine which approach best suits their needs. A related lesson learned from Moldova’s cloud migration journey is the importance of defining and evaluating what data really needs to be private. There was broad agreement with this point during the debate, with some estimating that only around 20% of all public data needs to be private. This has major implications for migration pathways, and indeed, cost.
Perhaps the most important lesson learned from this series of debates on cloud and data infrastructure is the value in facilitating multi-stakeholder engagement that integrates both public and private sector objectives to achieve development goals. Inspired by this vision, The World Bank has embarked on a collaboration with the International Finance Corporation (IFC) to support efforts to develop and invest in cloud and data infrastructure in developing countries, to better understand cloud-enabling environments and issues developing countries face on their cloud migration journeys, and to construct an investment decision framework to help channel private sector capital towards cloud solutions. Indeed, for most issues on the development agenda, collaboration and strategic engagement is as critical as the underlying technology solutions in yielding the development outcomes we all hope to see.
Related:
Digital Development at the World Bank
Digital Development Partnership
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