In today’s digitized world, data is the backbone of all business processes. Protecting this data from unauthorized access and maintaining full control over where it is stored and how it is processed is critical for companies to safeguard their security and economic interests.

 

In this context, the concept of a sovereign cloud plays a pivotal role. A sovereign cloud infrastructure refers to cloud systems that process data within a specific geographical region—in this case, Germany—while strictly adhering to applicable EU regulations and national laws, such as the GDPR.

 

For many advocates of Software-as-a-Service (SaaS) and cloud providers like Microsoft (Azure and O365), Amazon (AWS), or Google (GCP), the question arises: Why is it important to look for alternative providers?

 

Undoubtedly, the cloud offerings of these hyperscaler—providers of data centers with virtually unlimited, globally available computing power deliver integrated solutions that can digitize nearly all business processes. They provide a universe of digital services that seem easy for administrators to manage and versatile enough to integrate into any IT landscape.

 

However, using these services comes with risks that may not be immediately obvious to IT decision-makers or administrators. First and foremost, the deep integration of these services and their basic functionality-often deployed in the cheapest product variants—does not mean they are properly configured for IT security or compliant with data protection settings required by national laws and IT security standards.

 

A particularly critical issue arises when data is stored in data centers worldwide. For instance, the US Cloud Act allows U.S. authorities, under certain conditions, to access data held by U.S. companies, even if that data is stored in data centers in Germany or the EU.

 

Data protection authorities view this as highly problematic, especially when sensitive personal data (e.g., biometric data from video conferences or health data) is processed. With affordable service offerings, such as video conferencing solutions, the server location is often not selectable, meaning user data may be processed on servers in countries like China or other third countries with low electricity costs. This poses a significant risk for companies, as foreign governments may access or use the data without the company’s knowledge or consent.

 

These foreign providers often provide limited information about where and how data is processed, making it difficult for European companies to prove compliance with data protection and IT security requirements. In contrast, sovereign cloud providers offer full transparency regarding the technical and organizational measures implemented to ensure adequate IT security and data protection compliance.

 

Sanctions, trade restrictions (embargoes), or political tensions between the U.S. and the EU, or on a global scale, could further complicate or limit the use of U.S. cloud services and drive up costs due to potential tariffs.

 

One of the most critical yet often overlooked considerations when choosing a cloud provider is a well-thought-out exit strategy. This ensures that customers can fully, securely, and efficiently retrieve their data from the cloud in the event of termination or a provider switch.

 

An exit strategy includes standardized data exports in common formats and transparent documentation of the entire migration process to enable a seamless provider transition. Such a strategy is also a key component of ISO 27001 certifications and protects customers from significant price hikes by global players.