Two systems are better than one, say vendors. But what about vendor lock-in?
Amazon’s AWS European Sovereign Cloud, set to launch in Germany by the end of 2025, is starting to take shape with the announcement of SAP’s Sovereign Cloud as its latest partner.
The announcement is part of a gradual expansion of the capabilities on offer to organizations looking to invest in the concept of sovereign clouds to meet the challenges posed by AI expansion.
Fueled by vast amounts of data, AI could in time turn data sovereignty into a mainstream requirement across many industries. However, the question has always been how to migrate from a world where data sovereignty is an emerging and sometimes fraught undertaking towards one where it is robust enough to withstand regulatory oversight.
Amazon first floated the idea of the AWS European Sovereign Cloud in 2023, and followed up with a pledge earlier this year to invest €7.8 billion ($9.2 billion) in the initiative by 2040.
Earlier this month, it was SAP’s turn to increase its commitment to sovereign clouds when it expanded its own SAP Sovereign Cloud platform to allow customers run SAP workloads in their own data centers.
For organizations – primarily in government, critical infrastructure, finance, and healthcare – that see a need for this approach, the ability to combine the world’s biggest cloud and ERP platforms in a single platform will hold some appeal.
Other vendors also see the appeal. Adobe, Snowflake, Cisco, and MongoDB have already signed up to support the AWS Sovereign Cloud on a global basis.
Two clouds better than one
But what does deploying a SAP sovereign cloud inside a separate AWS sovereign cloud mean in practice? The official answer is that customers using SAP that also have a heavy investment in AWS applications can get the best of both worlds.
“By deploying the SAP Sovereign Cloud portfolio on the AWS European Sovereign Cloud, customers gain access to our comprehensive suite of sovereign cloud solutions, further strengthened by our trusted, long-standing partnership with Amazon Web Services,” said Thomas Saueressig, Member of the Executive Board of SAP SE, Customer Services and Delivery.
Another way of putting it: neither platform offers complete controls across the underlying cloud and application stack; combining them fills in these gaps.
From the AWS European Sovereign Cloud side, customers will be guaranteed that the compute, storage, networking, identity access management, security, and operations staff will comply with European data residency regulations.
It will be independent of AWS’s broader infrastructure, with no critical dependencies on non-EU infrastructure, SAP’s announcement said. AWS European Sovereign Cloud will have EU-based “strong technical controls, sovereign assurances, and legal protections.”
According to a deeper dive published in June by Amazon, this will be backed by a separate European organization and parent company with subsidiaries incorporated in Germany.
On the SAP side, the company’s Sovereign Cloud will provide assurance that data, encryption keys, replication, backup, telemetry, and logging meet the same standards.
Independent oversight
Sovereign clouds are suddenly important, fueled in Europe by a need to achieve local data oversight and control in an industry dominated by US cloud platforms and laws.
Every cloud vendor is developing its version of a sovereign cloud to serve this need, although questions remain about how independent some of these can be without setups with the sort of stringent oversight Amazon claims is necessary.
“For SAP customers, particularly those in highly regulated markets, I see this as a win-win,” said Joe Warnimont, a senior analyst with HostingAdvice.com. “The combination of AWS and SAP essentially removes the roadblocks often plaguing industries like healthcare and financial services. In the past, they had to choose between scalability and sovereignty. Now they get both.”
However, there are also negatives that come from working with two large vendors at the same time. “Although both customers of SAP and AWS now receive data sovereignty and scalability in one package, I think it’s crucial for them to look out for downsides such as extreme vendor lock-in and a lack of pricing options after when superpowers work together like this,” said Warnimont.
In addition, Amazon’s multi-billion investment in its AWS European Sovereign Cloud sounds impressive, but is over a 15-year period, an epoch by tech industry standards. For comparison, Amazon recently announced that it plans to spend £8 billion (US$10.4 billion) building data centers in the UK alone in the next five years.
In a separate development, SAP and OpenAI have announced a collaboration, planned for launch in 2026, to enable German public sector employees to use AI while meeting data sovereignty requirements. OpenAI for Germany will be supported by the SAP Delos Cloud local initiative.
