Microsoft CEO Satya Nadella talks up sovereign cloud credentials as firm announces general availability for Azure Local Disconnected, new capabilities for Foundry Local

Microsoft has expanded its Sovereign Cloud for AI and regulated environments, as CEO Satya Nadella hypes up the full extent of AI support the firm now offers.

Azure Local disconnected and Microsoft 365 Local disconnected are now generally available, allowing organizations to run critical infrastructure and productivity apps with Azure governance and policy controls, without the need for cloud connections.

Used via Microsoft 365 Local, customers get full control of their data, access, and compliance across the productivity suite, with core server workloads such as Exchange Server, SharePoint Server, and Skype for Business Server supported until at least 2035.

For the first time, qualified customers will also be able to use Foundry Local to run multimodal LLMs inside their on-premises, private cloud environments.

Speaking to assembled media at the Microsoft AI Tour in London, Alistair Speirs, GM for AI Infrastructure at Microsoft, said Foundry now covers “workstation class” infrastructure, including edge and air-gapped hardware, in addition to locally-hosted small language models (SLMs) on IoT devices, desktops, and laptops.

This includes tailored support for racks with AMD and Nvidia chips. Speirs added that there are currently no plans for Foundry Local to support Maia 200, with Microsoft primarily focused on AMD and Nvidia hardware.

“We’ve built the Maia chip so that it’s so focused on Azure it knows exactly where it’s running in the data center,” Speirs said.

He noted that this allows Microsoft’s global infrastructure to leverage an “unprecedented” amount of control over the chip.

Microsoft is doubling down on sovereign cloud

In the event keynote Microsoft CEO Satya Nadella said the firm is committed to sovereignty and aims to meet growing customer demands on this front.

"As you build out the data center, the requirement that now is absolutely front and center for everybody is how to ensure that in every region and every country you have sovereign controls," he said.

Nadella added that sovereign workloads form a “portfolio” for organizations to meet data residency and confidentiality requirements, across Sovereign Public Cloud, Sovereign Private Cloud, and Microsoft’s Sovereign Partner Ecosystem.

Speirs told assembled media that Microsoft is seeing new regulations targeting AI, cybersecurity, or data privacy introduced every four days.

To date, he added, over 1,000 global policy initiatives have been introduced across 69 countries – making compliance very complex.

Microsoft has positioned Azure Local disconnected as a key continuity option for sovereign environments, as well as classified and isolated workloads.

This is because it allows businesses to maintain ownership and control over their core environments, regardless of supply chain disruptions or geopolitical uncertainties.

“If you were to build some sovereign cloud infrastructure five years ago you would have made some assumptions,” said Speirs.

“But policies change, regulations change, geopolitics change. And so the ability to be able to flex and change that infrastructure is something we're really looking to build out so that as customers’ needs change, we help match that infrastructure as well.”

Nadella warned that organizations must ensure increased sovereignty doesn’t itself lead to increased risk and data exposure.

“Cyber resilience is a signals game – cyber resilience, fundamentally, is about having global intelligence to help you with your cyber resilience,”

“And so this is something that you want to think about which is, whenever you have a sovereign operation, how do you ensure that the sovereign operation does not lead to some cyber exposure?”

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