How Ireland became a cloud computing hotspot

Simon Edward • 14 October 2024

Today, Ireland is a hotbed of cloud computing activity. But how did it get here? Grab a chair – it's storytime.

Ireland is a country of many exports. But did you know that it's also a hotspot for cloud computing?

This is partly because of its capacious data centre infrastructure. In 2022, Ireland had 70 data centres. Around 40 more were either under construction or at the planning stage. Some of these facilities are owned by Amazon, Facebook and Google. Ireland, it seems, is no cloud slouch.

Why is Ireland such a popular spot for cloud investment?

It's partly the cool climate, which ensures that data centres won't overheat (an issue faced by many facilities in hotter parts of the world). It's partly the work climate, with its tech-savvy personnel. And it's partly the financial climate, with EU funding taps set to "on" and corporate tax incentives for tech firms.

That's the general picture. But how did Ireland get where it is today? In this article, we take a look at Ireland's cloudy past – and where it might be heading next.

The early days of the cloud

Two years before the Apollo 11 mission put humans on the moon, technology firm IBM was laying the foundations for cloud computing as we know it today.

They did so by creating virtualised versions of operating systems that could be used by more than one person. Over the decades, this gradually morphed into the cloud solutions we rely on today.

By the 2010s, the cloud was everywhere. Tech giants were centralising their infrastructure in huge data centres. Huge reservoirs of compute and storage resources were now available.

At this time, Ireland was dubbed "the home of the cloud". This built on its reputation as a centre of computing excellence. At the time, it had more than 20 data centres and was on Microsoft's radar for further investment.

Uptake was on the rise – but it went into the stratosphere during the pandemic.

Stay-at-home orders meant organisations had to be resourceful. They needed resources and applications to be available in home offices. The cloud provided the solution.

Ireland, of course, was no exception. But it was in an unusually strong position to be a front-runner as lockdown measures lifted and the cloud continued to grow.

The cloud in Ireland today

Today, Ireland is a cloud hub. Dublin alone is home to data centres run by Amazon, Microsoft, IBM SunGard and Digital Realty Trust.

Microsoft's Dublin hub is one of the biggest in the world. It's also at the forefront of sustainability in the sector, cooling its servers with fresh air rather than air conditioning.

Globally, the public cloud market seems to be snowballing without cease. The picture in Ireland reflects this, with experts saying that its public cloud sector could grow by an astonishing 97.78% between 2023 and 2027. That's somewhere in the region of $2.5 billion.

And it seems this rapid transformation has been welcomed by Ireland's businesses with open arms. A report from EY Tech Horizon asked respondents what they saw as "drivers of added value". Nearly half considered cloud technology to be at the top of the list.

The cloud sector is always evolving, with exciting developments appearing all the time. Nevertheless, 20% of respondents to the same report said they had already achieved their cloud goals – a figure that's higher than the global average.

What's next for Ireland's cloud sector?

Big tech firms have long had their sights set on Ireland – and it seems this trend will continue in the near future. AWS, for instance, is opening a Direct Connection facility in Dublin. Meanwhile, Chinese firm Huawei is promising to create around 200 jobs.

The tech sector often feels undervalued by government – but it seems the Irish government understands the cloud sector's economic potential. This is the sense you get from its digital strategy "Harnessing Digital".

This paper commits the Irish government to supporting the digital transformation of business and public services alongside continued investment in digital infrastructure.

Picture of Irish government HQ in Dublin.

It also addresses "digital divides". As in most parts of the world, adoption has been widespread but uneven. The government pledges to bridge the divide between big businesses and SMEs by providing financial assistance to smaller businesses. Similarly, it aims to bring rural and urban cloud infrastructure closer together.

Finally, the report focuses on digital skills development. As the cloud sector embraces artificial intelligence, the Internet of Things and other cutting-edge technologies, this will help Ireland remain competitive.

The importance of education

The government's focus on "digital skills development" is significant. Cloud computing is hard work. Businesses need skilled professionals to help them unlock its benefits.

Perhaps unsurprisingly for a country at the forefront of cloud computing, Ireland is home to several degrees and Master's courses in cloud computing.

At Munster Technological University, for instance, students can take an iMSc in cloud computing. This includes modules on cybersecurity, virtual environments, cloud storage infrastructures and cloud automation and orchestration.

Courses like this mean the cloud sector is populated by bright, studied professionals who know this complex technology inside out. It's an exciting time to be part of the sector.

Challenges

Perhaps the biggest challenge facing Ireland's cloud sector is the moratorium on new data centre development in and around Dublin until 2028.

EirGrid – Ireland's state-owned electricity grid – had grown concerned about the possibility of blackouts. The moratorium aims to free up capacity on the grid.

Critics say it could hinder both environmental and digital growth targets. Some are even warning of a "techxit", with foreign investors looking elsewhere.

There's no denying that this move by EirGrid presents a challenge to the sector. Nevertheless, Ireland remains a vibrant hotspot for cloud computing – and it looks like that's not going to change any time soon.

Are you looking for help with your cloud computing migration strategy? Ireland-based Ascend Cloud Solutions has handled more than 400 migrations and counting. Get in touch today for a free, no-obligation consultation.

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