Sovereignty 2 0 Why Europe S 180 Million Cloud Bet Matters

The global sovereign cloud market is projected to reach over $250 billion in just three years. Image: Alexandre Lallemand/Unsplash Last week, World Economic Forum President Børge Brende warned of three emerging bubbles threatening financial markets: crypto, AI and government debt – now at levels not seen since 1945. But there’s a critical dimension to this warning that wasn’t touched upon: the three bubbles all depend on next generation cloud computing power. And this is increasingly consolidated in the hands of a few geographically concentrated hyperscalers that control more than two-thirds of global cloud infrastructure spending. When investment bubbles meet concentrated infrastructure and a fracturing geopolitical order, systemic risk multiplies.

This is now a potential fourth bubble, and will be one of the top issues facing world leaders. The question for those gathering this week in Berlin for the Summit on European Digital Sovereignty, and those who will meet in Davos in January, is stark: How do you provide the technological and... Last month, the European Commission – with no home-grown hyperscalers – moved to provide an answer: a €180 million tender for sovereign cloud infrastructure to equip its institutions, noting that it “establishes a benchmark... Launched as a competition under the Cloud III Dynamic Purchasing System (Cloud III DPS), the tender will allow EU institutions, bodies, offices and agencies to procure sovereign Cloud services over 6 years. The tender establishes a benchmark for how sovereignty is applied in practice to cloud services. Up to four providers, registered in the Cloud III DPS, will be awarded a contract under a new Cloud Sovereignty Framework.

This framework measures sovereignty across eight concrete objectives. These objectives include strategic, legal, operational, and environmental considerations, as well as supply chain transparency, technological openness, security, and compliance to EU laws. By setting minimum assurance levels for each, the Commission creates a level playing field where cloud providers active on the EU market can demonstrate their sovereignty strengths. It drives the entire sector towards compliance with European standards and values. As the Commission continues to prioritise digital sovereignty, this tender marks a significant step towards creating a more resilient digital environment. The Cloud Sovereignty Framework is envisioned as a reference point for cloud providers and a catalyst for the growth of the EU cloud market, especially in the public sector.

The tender is expected to be awarded between December 2025 and February 2026. The European Commission has launched a tender for the procurement of sovereign cloud computing services. The contract, valued at €180 million ($209.09m), will span six years and see the awarded company providing European Union (EU) institutions, bodies, offices, and agencies with sovereign cloud services. As revealed by the European Commission on October 10, 2025, the contract will fall under the Cloud III Dynamic Purchasing System - the EU's procurement framework for cloud computing services. It will measure "sovereignty" across several criteria: strategic, legal, operational, and environmental considerations, supply chain transparency, technological openness, security, and compliance with EU laws. According to the commission, the contract is hoped to serve as "a reference point for cloud providers and a catalyst for the growth of the EU cloud market, especially in the public sector."

According to TheRegister.com, IONOS and German IT service provider Dataport have partnered to create dPhoenixSuite, a fully cloud-based workplace solution hosted exclusively in German datacenters under European jurisdiction. The platform serves six German federal states and handles tens of thousands of concurrent users while maintaining complete data control and transparency. A February 2025 Bitkom study found that 86% of companies prefer European AI infrastructure, driven by GDPR requirements and concerns about third-country provider risks. IONOS operates 18 datacenters across the EU and claims pricing up to 50% cheaper than US hyperscalers while complying with EU AI Act and NIS2 Directive regulations. Here’s the thing about government services moving to the cloud: citizens don’t get to choose their provider. When your local registry office or health department goes digital, you’re stuck with whatever infrastructure they picked.

And if that infrastructure answers to foreign laws or operates in legal gray areas, well, that’s problematic. The push for digital sovereignty isn’t just bureaucratic box-ticking. We’re talking about citizen data, tax information, health records – the stuff that really matters. IONOS makes a compelling case that European infrastructure controlled by European companies under European law is the only way to guarantee actual sovereignty. But is it really that simple? Look, the regulatory environment is getting brutal for US cloud providers in Europe.

Between GDPR, the EU AI Act, and NIS2, compliance is becoming a nightmare. IONOS claims many US platforms can’t legally meet these standards, which creates a massive opportunity for European providers. That 86% figure from Bitkom is telling. Companies aren’t just worried about fines – they’re concerned about geopolitical risks and not understanding foreign legal systems. When your entire business could be disrupted because of some legal change in another country, sovereignty starts looking pretty attractive. Cloud sovereignty ensures that data, workloads, and operations stay under EU control.

Learn why it matters, the key regulations, and how to achieve true sovereignty. US based hyperscalers continue to dominate digital infrastructure worldwide. Yet across Europe, there is a growing movement to protect data from both cyber threats and extraterritorial laws, and to ensure full regulatory compliance. Cloud sovereignty has become a cornerstone of this effort. Cloud sovereignty ensures that data, workloads, operations, and digital infrastructure remain under the jurisdictional control of the country or region where they reside. It goes beyond simple data residency.

For European organizations, it is about visibility and legal control over how and where sensitive information is stored, processed, transferred, and who can access it. For organizations across the EU, digital and cloud sovereignty are closely tied to trust, compliance, and competitiveness. Regulations such as the GDPR require that personal data remain protected under EU law. Noncompliance can result in severe fines and long term reputational damage. The stakes are even higher for government agencies, operators of Critical National Infrastructure (CNI), and regulated industries such as healthcare and finance. These sectors handle highly sensitive data and face stringent compliance demands.

For them, cloud sovereignty is essential to meet regional laws, build operational resilience, and reduce exposure to foreign surveillance. Europe's quest for technological sovereignty unfolds--from AI chips to cloud services. Ambitious strategies shape a new digital paradigm. homegrown firms but also transfers taxpayer-funded benefits—such as education and research—abroad, as American investors capture the gains. Sovereign tech is having a moment in Brussels. But beyond the usual policy platitudes and industry jargon, what does it really mean?

And why is Europe suddenly so obsessed with controlling its own digital infrastructure? Let’s start with the basics. Technological sovereignty is the ability to produce, manage, and maintain your own tech stack without needing to ask permission from Washington or Silicon Valley. Digital sovereignty is slightly broader: it’s about controlling the data, software, and standards that shape your digital life. Add in economic sovereignty and strategic autonomy, and you’re looking at a full-spectrum shift in how Europe wants to position itself in a world dominated by US and Chinese tech giants. The European Commission frames sovereignty as “the power to be able” — a useful reminder that this is less about GDP metrics and more about agency.

Brianna Monsanto is a reporter for IT Brew who covers news about cybersecurity, cloud computing, and strategic IT decisions made at different companies. The European Union’s (EU) desire for cloud sovereignty has seemingly been reignited as geopolitical tensions push organizations to reevaluate the region’s reliance on the US for its digital infrastructure needs. Last week, Amazon Web Services (AWS) announced it had launched a new European parent company and three subsidiaries incorporated in Germany for its European Sovereign Cloud offering. The parent company will be “locally controlled” and led by EU citizens. AWS European Sovereign Cloud is expected to roll out by the end of the year. “There will be zero operational control outside of EU borders; the AWS European Sovereign Cloud will be operated entirely by residents of Europe,” the tech giant wrote in a blog post.

“Only AWS employees, residing in the EU, will control day-to-day operations, including access to data centers, technical support, and customer service for the AWS European Sovereign Cloud.” The move joins several efforts by hyperscalers to bolster sovereign cloud solutions for customers. In May, Google Cloud announced several enhancements to its sovereign cloud offerings, including a new solution that conducts “recurring security testing of customer applications to validate sovereignty postures.” The month prior, Microsoft pledged to... As the year winds down, and we all start to look toward the new year, and prepare for the next WEF meeting in Davos, I'm going to spend a little more time digging into... No more flights in the next few weeks. No more travel.

But a lot more reading, reflecting and dissecting overused and often misunderstood terms. In all transparency, I hate the words "governance" and "sovereignty." Yet, despite a clearly buzz-worthy title, I found the recent WEF article, "Sovereignty 2.0: Why Europe’s €180 million cloud bet matters" a useful review... A couple of highlights I jotted down: 💡 Strategic autonomy means having genuine alternatives and the operational capacity to exercise them – not unrealistic expectations of eliminating all external dependencies. NOTE: "Sovereignty" is not used here. 💡 Strategic autonomy means having genuine alternatives and the operational capacity to exercise them – not unrealistic expectations of eliminating all external dependencies. This requires multi-vendor architectures, portable workloads and avoiding being locked in to any one proprietary ecosystem.

The bottom line: "Build hybrid resilience." And, that comes from having more options, dare I say more friends not more enemies. At least, more collaboration partners. This is the new "coopetition" I wrote about earlier this year. https://lnkd.in/dmJrmdHc The goal is to encourage collaboration with guardrails, not policy roadblocks. https://lnkd.in/dKQejggH As the race to advance digital economies gathers pace, European leaders face a dilemma: How to promote domestic cloud competition that reduces dependence on external providers, while ensuring European security and control over data.

This was the central focus of many conversations last week, when over 500 of Europe’s leading voices on sovereign cloud met in Brussels to discuss Europe’s drive for competitiveness and resilience. Now in its third year, the European Sovereign Cloud Day – hosted by Broadcom – brought together regulators, researchers, industry leaders, and policymakers to discuss how Europe can uphold its position as a cloud... Why has cloud sovereignty become such a pressing issue? Nearly three-quarters (72%) of cloud services are provided with AWS, Microsoft Azure and Google Cloud in Europe, and up to 90% of European data resides outside EU-controlled infrastructure - therefore creating serious geopolitical and... Issues like European control, confidentiality and accessibility become even more critical in our digital-first world. Here, we discuss the key themes from the European Sovereign Cloud Day, including the growing need for cloud sovereignty, the role of regulation, and the importance of sovereign cloud to the pressing issue of...

Striking a careful balance between cloud innovation and data control is becoming ever trickier, with data volumes increasing exponentially as we enter the generative AI age. We’re expected to go from generating 33 zettabytes in 2018 to an estimated 572 zettabytes in 2030, thus underpinning the growing need for robust sovereign data infrastructures. David Michels, Researcher at Queen Mary University of London, highlighted some of the core concerns around confidentiality and availability of data and why sovereign cloud holds the key to relieving some of these fears... Cloud sovereignty ensures users have control over where their data is stored and who can access it, while providing protection against vendor lock-in. It also limits the jurisdictional reach of non-EU governments over European data.

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