Most business and IT leaders believe that sovereign AI is important, but they're not so clear on what it actually is and what it means for their business.
IDC defines sovereign AI as the ability for an organization to have “free choice and control over the design, development, deployment, accessibility, operation, maintenance, and governance of its AI systems and applications, as well as the underlying technology foundations they depend on”.
However, in a survey conducted by IDC on behalf of Cohere, researchers found that one-in-three had difficulty describing sovereign AI in their own words.
Of those who could, 52% of leaders explicitly described it in terms of local or national control, with 35% invoking digital independence.
Individual roles made a difference here, with line-of-business (LOB) leaders primarily viewing sovereign AI as a means for managing business risk, including data security, privacy, and cost controls.
IT leaders, by contrast, focused on regulatory compliance, ensuring that systems meet national and regional requirements. IT professionals were twice as aware as LOB leaders.
IDC predicts that by 2028, CIOs at multinational organizations will boost investments in modular, sovereign-ready cloud and data localization environments by 65% in a bid to future-proof operations against rising sovereignty demands.
IDC predicts that by 2028, CIOs at multinational organizations will boost investments in modular, sovereign-ready cloud and data localization environments by 65% in a bid to future-proof operations against rising sovereignty demands.
Yet adoption remains uneven, according to IDC. The study pointed to a lack of a clear blueprint for operationalizing sovereignty, a fragmented and inconsistent grasp of the concept ,and a lack of strategic vision.
On the right track with sovereign AI
Even without an agreed-upon definition, researchers found a clear consensus on the importance of privacy and security.
"Across every industry surveyed, enterprise leaders identified data leakage, privacy, compliance, and regulatory risk as the top concerns that sovereign AI initiatives can address, they said. "Furthermore, the largest enterprises with $20 billion in revenue are much more risk-aware than small firms."
Many see sovereign AI as presenting a competitive advantage - 35% in Canada, 28% in the US, 23% in Germany and 18% in the UK. This is most evident within the telco sector, at 37%, followed by manufacturing at 32%, healthcare at 28%, and financial services and energy, both at 21%.
“Across regulated industries and geopolitically sensitive markets, enterprises are re-architecting their digital operating models — shifting from a global-by-default posture to a deliberately sovereign-by-design approach,” researchers said.
Defining sovereign AI
Cohere said enterprises and governments should define sovereign AI in operational terms, quantify its business value, establish ownership across leadership teams, and build systems that remain available and secure regardless of external events.
Late last year, a global survey from McKinsey found that 71% of executives, investors, and government officials characterized sovereign AI as an 'existential concern' or 'strategic imperative' to their organizational goals.
As a result, the firm projected that sovereign AI could become a $600 billion market by 2030, driven largely by investment in the public sector and regulated industries.
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