For many European organizations, cloud decisions are no longer just about cost, scale or performance. As companies evaluate options like Amazon’s sovereign cloud, choices are increasingly shaped by questions of control: where data is housed, who has access to it, and how critical systems are exposed to foreign laws and political pressure.
This tension helps explain why so-called “sovereign cloud” offerings have gained attention across the European Union. These services are designed to keep data within national or regional boundaries and restrict access to locally authorized personnel. The idea gained weight as regulators focused on US tech companies and their role in Europe’s digital infrastructure.
In this context, Amazon has started rolling out a European version of its sovereign cloud through Amazon Web Services. AWS European Sovereign Cloud, based in Brandenburg, Germany, was first introduced in 2023 and is now positioned as a stand-alone setup for customers with strict data and management needs.
Sovereign cloud is a broad term, but typically refers to cloud services where data is stored and processed within a defined jurisdiction and not moved elsewhere. For public agencies, defense agencies, utilities, and regulated industries such as finance and healthcare, this distinction can affect whether cloud service is even an option.
AWS says its European sovereign cloud is “physically and logically separate” from other AWS regions. It has also created a new parent company for the service, which is locally managed within the European Union and operated by EU citizens. Under what AWS describes as “extreme circumstances,” authorized EU resident employees would have independent access to a replica of the source code needed to maintain the service.
For CIOs and compliance teams, these details are important, but unlikely to be taken at face value. Many organizations already rely heavily on AWS and other hyperscalers, even as boards and regulators ask tougher questions about dependency and oversight. A sovereign cloud option from an existing provider can reduce friction for teams that want to stay with familiar systems, while showing regulators that additional safeguards are in place.
At the same time, some buyers may see the move as a partial answer rather than a clean break. While the infrastructure may sit in Europe, AWS remains an American company subject to US law. This raises questions about how far the legal department can go in practice and whether governance structures are sufficient to address long-standing concerns about access and control.
These concerns are not abstract. European policymakers have spent years warning against relying on foreign cloud providers for sensitive workloads. The debate has intensified as the EU pushes for stronger enforcement of its competition and data rules. According to Synergy Research Group, AWS, Microsoft and Google together account for about 70% of the European cloud market, a number that is still under investigation.
This review now includes an active investigation. European regulators are scrutinizing cloud services from Amazon and Microsoft under a digital markets law designed to curb the power of big tech firms. The timing raises an obvious question: does the sovereign cloud structure alleviate regulatory pressure or simply run alongside it?
From a regulatory perspective, the answer may depend on whether these offerings change the outcomes, not just the architecture. Keeping data local and restricting access can solve some privacy and security concerns, but competition authorities are also focusing on market power, customer lock-in and the ability of smaller providers to compete. A sovereign cloud operated by a dominant player will not automatically solve these problems.
AWS has also described its sovereign cloud as resilient to global disruption, saying it can continue to operate even if communications with the rest of the world are disrupted. For governments and critical infrastructure operators, this statement speaks more to continuity planning than performance. However, it still remains a claim made by the provider itself, and one that customers and regulators are likely to test over time rather than accept in advance.
In terms of investment, Amazon said in 2024 that it would spend 7.8 billion euros on the German sovereign cloud project by 2040. The company also said it plans to expand the setup to Belgium, the Netherlands and Portugal. This suggests that AWS expects demand from European customers to grow even as political pressure around digital sovereignty continues.
For enterprises, the emergence of sovereign cloud options reflects a shift in cloud risk assessment. Cost savings and speed are still important, but are now weighed against regulatory risks, audit complexity and long-term dependency. Whether AWS’s approach becomes a model for balancing these pressures, or another point of contention in Europe’s relationship with US tech firms, will depend less on blueprints and more on how regulators respond in practice.
(Photo by Christian Lue)
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