SAP said it will invest more than €20 billion Euros in sovereign cloud efforts for European customers as it rolled out a series of offerings.
Sovereign cloud infrastructure is seen as a big growth area for technology vendors as countries aim to keep data in country and build up AI infrastructure.
For instance, SAP CEO Christian Klein said on the company's second quarter earnings conference call that European customers are focused on digital sovereignty. "Sovereignty is a huge aspect what SAP can contribute to the competitiveness of Europe, especially in areas like public sector and of course, also defense," said Klein.
According to SAP, SAP Cloud Infrastructure and SAP Sovereign Cloud On-Site will give European customers the ability to keep data and AI operations in the region. The effort also means that SAP will be running its own cloud for public sector and regulated customers in Europe.
- SAP delivers 24% cloud revenue growth in Q2
- Clorox to go live with new SAP ERP system, eyes margin improvement
- Celonis, SAP reach data access cease fire amid litigation
SAP to add AI agents for catalogs, order management - SAP's big plan at Sapphire 2025: Make its Joule AI agent omnipresent
- SAP Store: Reinventing Digital Procurement for the Intelligent Enterprise
- SAP launches Business Data Cloud, partnership with Databricks: Here's what it means
SAP said SAP Business Suite, SAP Business Technology Platform and SAP Business AI will run in SAP Sovereign Cloud. SAP's platform can run on any hyperscale cloud provider, local clouds and data centers run by the vendor.
Here's a look at the expansion of SAP Sovereign Cloud:
- SAP Cloud Infrastructure in Europe. SAP will offer infrastructure-as-a-service in its own data centers with open-source technologies. All data will be stored in the EU.
- SAP Sovereign Cloud On-Site. SAP will offer SAP-operated infrastructure in customer-owned or customer-selected data centers.
- Delos Cloud. SAP will offer Delos Cloud in Germany, a sovereign cloud for public sector customers.
SAP said SAP Sovereign Cloud will run in multiple countries.
Constellation Research analyst Holger Mueller said:
"SAP has known about the sovereign cloud demands and expectations of its European customer base for a long time, and evidently has not seen the traction and interest from its cloud partners to provide sufficient sovereign cloud offerings and reassurances. As a result, SAP is stepping up its offering. This is interesting as SAP has de-emphasized its inhouse cloud since a long time. Will SAP have the appetite to put the capital expenditures into its own cloud infrastructure? With the cloud at customer SAP is setting itself up to significant more cloud revenue. Revenue in this category was NOT cloud revenue so far, but will be going forward."
