Reliance on US tech providers is making IT leaders skittish

UK IT leaders have voiced serious concerns about the influence of big US cloud providers in the wake of tariffs imposed by the Trump administration.

A survey of over 1,000 UK IT leaders from Civo shows more than 60% of respondents believe the UK government should cut its use of US cloud services.

Key concerns highlighted in the report include exposing the country’s digital economy to “significant risks” with regard to data security and the impact providers have on the domestic cloud industry.

Notably, 61% of respondents said data sovereignty is now a strategic priority for their organization. Similarly, nearly half (45%) revealed they are currently exploring the possibility of repatriating workloads from the public cloud due to lingering data protection concerns.

Regulatory compliance considerations are also changing outlooks on data protection and privacy, Civo found. Around 40% of respondents said transparency and compliance with both EU and UK data protection regulations could influence their relationship with US cloud providers.

Civo chief executive Mark Boost said the survey findings highlight changing industry sentiment toward big US tech firms.

“These results will be no surprise to anyone with their ear to the ground in the industry. People are more alert than ever to just how valuable their data is, and it’s been astonishing how quickly cloud repatriation and sovereignty have become leading strategic considerations for IT leaders,” said Boost.

“The market is crying out for greater visibility over where data is stored, used, and transferred, and at present, US providers are failing to meet that demand.”

Erosion of trust

Trust in US-based big tech providers has taken a hit in recent months, largely spurred by political tensions on both sides of the Atlantic.

In late April, Microsoft said it would fight to protect European data from American overreach after President Trump signed a memorandum pledging to support US companies in the face of what the administration described as “overseas extortion”.

The memorandum specifically highlighted European regulations such as the Digital Markets Act (DMA), suggesting this was hampering US tech companies.

More recently, Google Cloud unveiled a range of updates to its sovereignty services in what appears to have been an attempt to calm European enterprise concerns over data protection.

Civo warned that a “broader erosion of trust” in large cloud computing providers has emerged in recent months, with only 36.6% of respondents saying they trust big tech companies to handle their data.

Enterprise trust has become even more critical given the industry-wide focus on generative AI adoption, the study noted. More than two-thirds (67%) revealed they would only use AI services where there is “absolute certainty” that they own and control data inputs and outputs.

67% said they would only use AI services where there is absolute certainty they own data inputs and outputs.

Data sovereignty gains traction

Data sovereignty is by no means a new industry trend. In the EU specifically, efforts to bolster data protection have been spurred on by the introduction of new regulations across the bloc.

Hyperscale cloud providers have made efforts to adapt to these changing customer needs, however, with Microsoft, Google, and AWS all introducing sovereign cloud services in recent years. Other major industry players that offer public cloud through managed services, such as IBM and Oracle, also offer similar products.

Oracle in particular has been very proactive on this front over the last 18 months, with CTO and chairman Larry Ellison leading the charge on cloud sovereignty in the region.

Last year, Ellison predicted a wholesale shift toward national sovereign cloud setups, with governments across the European Union aiming to keep data in-country.

“Pretty much every government is going to want a sovereign cloud and a dedicated region for that government,” Ellison said at the time.

Civo said the heightened focus on cloud sovereignty shows no signs of abating looking at forward. The firm’s survey showed data sovereignty now ranks as the second-most pressing matter for businesses - overtaking price and breadth of services.

“Data sovereignty is shifting from an additional selling point to a business-critical necessity,” the company said.

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