The internet economy as the biggest cash cow for the Netherlands

“There is, once again, a miracle going on in the Netherlands.” This is how Mark Rutte, the Dutch prime minister, described the role the Netherlands has as digital gateway to Europe, when he appeared on VPRO’s Summer Guests (Zomergasten) television programme on 4 September. Rutte was referring to the third gateway in the Netherlands. Alongside Schiphol and the Port of Rotterdam, the Netherlands also has a third important transit role for the rest of Europe: The digital infrastructure.

Since the end of 2015, the Dutch government has designated this digital infrastructure as the gateway to Europe, placing particular emphasis on the economic importance of this infrastructure and on maintaining close relationships with stakeholders in order to jointly formulate an economic vision to maintain and strengthen this position as Digital Gateway to Europe. This is not surprising, considering the following image:

Digital gateway to Europe

Digital infrastructure encompasses housing and hosting as well as connectivity, and these are exactly the areas of expertise of Interxion and its partners. In these fields, Amsterdam easily competes with cities such as London, Paris and Frankfurt due to entrepreneurship, innovation capacity and active participation in the internet community. And these are not so much “miraculous” as more permanent advantages of the Netherlands. In this blog I will explain why.

  1. Location

    Geographically the Netherlands is ideally situated for the role of transit port. That is precisely why the Port of Rotterdam is so large. Add to this the excellent infrastructure and you have a flying start for servicing the rest of Europe. This applies not only to the road, rail and waterway infrastructure but also to the digital infrastructure. For example, 11 of the 15 transatlantic submarine cables have landing stations in the Netherlands.

Transatlantic submarine cables Netherlands

The AMS-IX is the second largest internet exchange in the world, with a maximum throughput of 4711Gbit/s. In the Netherlands there are more mobile subscriptions than people and 91 percent of households have an internet connection. The broadband and telecommunications providers also offer one of the most reliable, fast and available (wireless) connections in the world.

  1. The people

    The Dutch have always been a nation of entrepreneurs . In addition, they are exceptionally highly educated nowadays: 40 percent of 25-34 year olds have a bachelor’s degree or higher. 55% of those working in the IT sector have a bachelor’s degree or a master’s degree. The Dutch are proficient in the English language and, as a society, they are extremely technologically oriented. Therefore, many businesses view the Netherlands as the perfect test market for the adoption of technological innovations. That is also partly due to the Netherlands being one of the top 10 business friendly countries thanks to the attractive tax environment, the stable industrial relations and the fact that it is the sixth largest economy in Europe. Also, the Netherlands is the only European country where three out of the four large public cloud players have their own data centres, and that is why many foreign companies choose to base themselves here. That number currently stands at more than 6,300 companies. It seems unlikely that they are here just for the tulips. In fact, I think that this number may rise further due to Brexit. In any event, Interxion is preparing itself ….

  1. Tech Hub

    Lastly, the Netherlands is a source of technological innovations. 60 percent of the top 2000 IT companies are based in the Netherlands. In addition, the Dutch are exceptionally innovative . 70 percent of all innovations in the Netherlands are IT related. Protocols and standards such as Bluetooth, Wi-Fi, iDeal and the programming language Python are innovations of Dutch origin. And the Netherlands also has a presence at the top of the hardware sector – roughly 60 percent of all the chips in the world are produced in the Netherlands, mostly by ASML.

Digital gateway & data centres

There is little doubt that there are many factors supporting the important role of the digital gateway. Not only the geographic location of the Netherlands, but also the Dutch themselves and the entrepreneurial climate ensure that the Netherlands leads the way. It is of the utmost importance that one realizes that the Netherlands is not only a transit port for goods, but also for data. And that means that data centres are becoming increasingly important, for both the Netherlands and for Europe.
Now that the internet economy is becoming an increasingly large part of the total Dutch economy, it is logical that the demand for data centre capacity is also increasing. It is great to see that a data centre such as Interxion is fully aware of this. Not only is Interxion taking account of this by anticipating the growth of the internet economy, but also at client level, Interxion is ready to contribute to potential growth scenarios, with long-term planning and flexibility being the norm. In the Netherlands, the construction of our eighth data centre is in full swing . Interxion already has 42 data centres spread over 11 European countries and we offer our clients comprehensive security and availability for their business-critical applications. With more than 600 connectivity providers, 21 European internet exchanges, and leading cloud and digital media platforms, we really can state that these data centres truly are cloud, content, financial, and especially, connectivity hubs. And these connectivity hubs offer fertile ground for business growth, and with it, economic progress. Actually Mark Rutte is right. To be able to contribute to this, does indeed feel like a “miracle”, especially now that the Netherlands, as Europe’s digital gateway, has an even bigger pull factor for businesses and their data needs. The internet economy continues to grow, largely dependent on connectivity hubs.

 For more information about the Netherlands as the Digital Gateway to Europe, view the infographic here.