For the past decade, the technology world has fed us a vision of digital cosmopolitanism. Cloud computing was supposed to be a transnational entity, an ethereal layer of innovation that, like Roman aqueducts, provides life-giving resources regardless of latitude. We believed in ‘Cloud Anywhere’, in stateless clusters and an architecture for which national borders were merely an annoying artefact of the analogue past.
However, 2026 brings a painful wake-up call. According to Gartner‘s latest forecasts, global spending on cloud sovereigns will increase by 35.6%, reaching a not inconsiderable $80 billion. This is no mere market correction. This is the moment when digital globalism collides with the hard wall of geopolitics, and the Seattle and Mountain View giants – hitherto the priests of universalism – must hastily learn their local dialects.
The anatomy of a concession
Rarely in the history of IT have the major players voluntarily abandoned economies of scale. The foundation of the power of AWS or Microsoft Azure was unification: one technology stack, one operating model, one global management system. But today’s landscape, dominated by the fear of losing their ‘digital autonomy’, is forcing them into a process that could be called controlled fragmentation.
The launch of AWS European Sovereign Cloud or the Sovereign Core platform from IBM are acts of capitulation to the hard law of sovereignty. They are an attempt to answer a fundamental question: who has the last word when the cloud operating system needs to be rebooted and the encryption keys are of interest to a foreign jurisdiction?
Survival strategy
The most interesting phenomenon, however, is how deftly the technology giants are adapting to the role of ‘local suppliers’. We are seeing a fascinating market spectacle: companies that epitomise American technological dominance are entering into alliances with national telecoms champions in Europe or Asia. Partnerships with T-Systems in Germany or Orange in France are nothing short of ‘yowhite-labeling’ of trust.
For the business customer, this is a paradoxical situation. On the one hand, he receives the promise of Silicon Valley-like innovation, on the other, the guarantee that data will not leave his backyard. But has there really been a change under this mask? Critics point to the problem of the U.S. CLOUD Act, which in theory allows U.S. services to access data managed by U.S.-based companies, regardless of the location of the server. Hyperscalers are doubling and tripling to prove that technical barriers render this law useless. It is a technological arms race where credibility is at stake.
80 billion reasons to play locally
Why do the giants opt for the engineering nightmare of maintaining separate sovereign regions? The answer is: because they have no choice. Gartner predicts that by the end of 2026, organisations will move 20% of their existing workloads from global public clouds to local providers. This is a gigantic capital outflow.
Spending growth of 35.6% is being driven by critical sectors: governments, banking, energy. These are industries that have stopped believing in the ‘goodwill’ of global corporations. As trust erodes to the point where government organisations begin to consider whether geopolitical tensions could lead to sudden service cuts, sovereignty has become the new KPI for boards.
Gartner’s Rene Buest rightly points out that the aim is to ‘keep wealth generation within its own borders’. Data has become the new oil, and the sovereign cloud is the local refinery. Countries have realised that by allowing data to flow freely to global centres, they are losing not only control, but also the potential to build their own AI models and innovations.
Sovereignty tax
However, this new reality carries a hidden cost. We need to talk openly about a ‘sovereignty tax’. Localised solutions, cut off from global networks, will inherently be more expensive to maintain. Moreover, they may suffer from so-called ‘technology lag’. The latest AI services, the most advanced language models or analytics functions tend to debut in major cloud regions. Sovereign enclaves may receive them with a delay of several months or even a year.
Business is therefore faced with a dilemma: maximum innovation or absolute control?
Will the mask become a face?
The year 2026 will go down as the moment when cloud computing finally lost its innocence. The hyperscalers, donning the masks of local providers, made a masterstroke – instead of fighting regulation, they decided to capitalise on it.
However, it is important to remember that data sovereignty is not just a question of where the server stands, but who has the authority to operate it and who controls the platform’s source code.
