Two-thirds (66%) of UK businesses could ditch US cloud providers due to rising concerns about digital sovereignty, according to a new study.

Research conducted by Civo found digital sovereignty is now viewed as a “strategic priority” by 73% of firms, marking a 12-point increase compared to last year and shaping decisions on what cloud services to use.

Reliance on a limited pool of foreign cloud providers is also an area of concern, according to Civo, with 64% highlighting this as a recurring talking point.

Notably, with businesses ramping up AI adoption, this adds another layer of complexity to sovereignty-related discussions.

More than half (58%) of respondents told the firm they’re concerned about their AI providers’ legal jurisdiction, while 43% said AI workloads must be hosted within the UK.

“AI has raised the stakes for digital sovereignty,” said Civo chief executive Mark Boost. “The issue is no longer just where data is stored, but also where systems are built, who controls the infrastructure and which legal jurisdiction it falls under.”

“The UK must control the infrastructure on which AI is built to ensure long-term competitiveness in the field. Sovereign cloud is about resilience, choice and control, not digital isolationism,” he added.

UK firms paying the ‘sovereignty tax’

While British companies are keen to reduce their reliance on US-based tech providers, the Civo study noted that many are unable to “break free” and are locked in a cycle of dependency.

Civo refers to this as a “sovereignty tax”, which creates “significant financial, operational, and strategic risks”.

“UK leaders clearly want to break free from Big Tech dependency, but find themselves trapped by an ever-tightening web,” Boost commented.

“This is not a proactive investment or deliberate strategy. It is a symptom of organizations becoming increasingly ensnared in the same hyperscaler ecosystems they acknowledge to be a significant long-term risk.”

Key hurdles to reducing dependence include technical lock-in, complexity of migration, contractual barriers, and various other financial implications of switching providers.

Civo noted that the number of companies that have successfully migrated to a domestic alternative has “stalled” at just 15% while only one-in-four UK companies believe they could ditch a US provider entirely.

Looking ahead, the company predicts that UK firms could end up becoming “more deeply entrenched” in US hyperscaler systems, with 28% having already found themselves in this predicament.

A ‘dangerous loss of autonomy’

Civo warned that remaining locked into foreign-owned infrastructure could result in a “dangerous loss of autonomy” for UK firms, and this isn’t just in terms of data privacy or security.

Other factors also play a role in the aforementioned sovereignty tax, such as unpredictable costs and events such as outages. The firm specifically highlighted the latter of these as a potential danger for UK businesses, with 39% of firms having experienced outages originating from US hyperscalers over the last year.

Enterprises across the country were impacted by a series of major cloud outages last year, most notably with Amazon Web Services (AWS) and Microsoft Azure. Similar outages at Cloudflare, meanwhile, also had a huge impact on operations for firms operating across a range of sectors.

These outages have a huge financial impact on UK enterprises, Civo noted. That tracks with research from Relic last year that warned many UK and Irish firms are “severely underestimating” the costs associated with outages.

Analysis from the firm revealed that “high-impact” outages carry a median cost of around $2 million per hour, with UK and Ireland-based organisations reporting losses of between $1 million and $3 million per hour.

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All of the major cloud service providers have built vast global infrastructure networks that allow enterprises to centralise workloads and reduce infrastructure overheads. The assumption has always been simple: bigger cloud platforms meant greater efficiency and resilience, enabling businesses to innovate at speed. balance cost, control, and performance.

But as explored in Part 1 of this series, that model is beginning to change. Rising cloud costs and the growing demands of AI workloads are forcing enterprises to rethink where applications and data should live.

Now, other powerful forces are reshaping enterprise infrastructure strategy. Sovereignty, geopolitical instability, and increasingly strict regulatory requirements are driving organizations toward more distributed, regional, and policy-aware cloud environments.

This article, the second in the three-part series Post-Cloud Strategy: What Comes After Hyperscale?, considers how sovereignty and security concerns are accelerating the rise of regional cloud providers and sovereign cloud initiatives. Part three, Hybrid by Design: Architecting the Next Enterprise Stack, will explore how enterprises are designing resilient hybrid and multi-cloud architectures that

Sovereignty is becoming a board-level concern

Data sovereignty has evolved far beyond a compliance checkbox. Increasingly, it is shaping strategic infrastructure decisions at the highest levels of enterprise leadership.

Alexandra Thorer, chief growth officer at BCS Consultancy, says enterprises are moving away from the idea of cloud as a single, borderless platform. “Across the market, organizations are increasingly seen moving away from purely centralised cloud models and toward more regionally segmented architectures,” she says. “Rather than treating cloud as a uniform global layer, many enterprises now design around jurisdictional boundaries, particularly where regulatory scrutiny is highest.”

That shift is especially visible in Europe, where concerns around cross-border data transfers and digital autonomy are intensifying. Adam Low, chief technology officer at Wire, says enterprise cloud strategies are now being shaped as much by governance and risk as by technical performance.

“Cloud strategies have fundamentally shifted from a sole focus on cost and scalability to a greater emphasis on control and risk,” Low explains. “Organizations are paying closer attention to where their data resides, who can access it, and which legal frameworks apply. This is driving increased adoption of hybrid and multi-cloud models, with greater emphasis on jurisdiction, governance, and resilience.”

One of the biggest areas of confusion is the distinction between regional cloud infrastructure and genuinely sovereign cloud environments. Regional cloud offerings may guarantee that data remains inside a specific geography, but sovereign cloud models go much further, focusing on operational governance and jurisdictional independence.

“In practice, the distinction is often framed less around location and more around control,” Thorer says. “There is a growing expectation, particularly among regulated industries, that a sovereign cloud should limit exposure to foreign legal frameworks, restrict administrative access to locally governed personnel, and provide greater transparency into operational processes.”

Speaking to ITPro, Mark Boost, CEO at Civo, argues that many organizations are only now beginning to recognize the long-term risks of relying heavily on foreign-owned cloud infrastructure.“Sovereignty is about jurisdictional control, rather than where a data centre is based,” Boost explains. “Even if data is stored in the UK, if your data is held by a US provider, it can be accessed by US authorities under the US Cloud Act. This means it is never truly sovereign.”

For many enterprises, sovereignty concerns are no longer theoretical. They are directly influencing workload placement and long-term infrastructure planning.

Geopolitical instability is reshaping infrastructure decisions

The cloud industry was originally built around the idea of abstracting global infrastructure. Increasingly, however, geopolitical tensions are reintroducing geography into enterprise IT strategy. Organizations are becoming more cautious about concentrating workloads in a specific jurisdiction or relying too heavily on a small number of hyperscale providers.

BCS Consultancy’s Thorer says enterprises are paying far closer attention to geopolitical risk than they were even a few years ago.“There is evidence of increased attention to jurisdictional risk, including concerns around sanctions, data access laws, and political stability,” she explains. “In some cases, this is leading to diversification strategies, avoiding concentration of data or workloads in a single geography or under a single provider.”

Those concerns are accelerating demand for regional cloud providers and sovereign infrastructure initiatives designed to reduce dependency on foreign-controlled platforms. Boost believes geopolitical instability has fundamentally changed how organizations think about cloud dependency.

The growing importance of digital sovereignty is also influencing government policy. Across Europe, governments are increasingly encouraging local cloud ecosystems, sovereign AI initiatives, and national investments in digital infrastructure. Mike Hoy, CTO at Pulsant, says enterprises are already responding to the changing environment by reassessing their dependence on public cloud.

“Within the UK, compliance with sovereignty and residency regulations is becoming the dominant factor in cloud strategies,” Hoy says. “The most immediate and obvious impact is the continued flight from public cloud.”

At the same time, hyperscalers are adapting rather than retreating. Many are introducing localized governance controls and sovereign cloud partnerships in response to growing customer demand for greater transparency and jurisdictional control. The result is an increasingly layered cloud market where organizations mix hyperscale services with sovereign infrastructure, regional providers, private cloud, and edge environments depending on workload sensitivity and operational priorities.

Security is no longer defined by scale alone

For several years, hyperscalers positioned scale as one of their greatest security advantages. Their enormous investments in cybersecurity resilience engineering and threat intelligence created a perception that global cloud platforms inherently offered the safest environments.

That advantage still matters. However, sovereignty concerns are reshaping how enterprises think about security itself. Organizations are increasingly evaluating not just whether infrastructure is technically secure, but whether they retain sufficient visibility, governance, and legal control over their data and operations.

Wire’s Adam Low says sovereign cloud models are forcing enterprises to rethink the relationship between security and control. “Global providers benefit from scale and highly mature security capabilities,” he says. “Sovereign and regional approaches can offer comparable levels of security when properly designed and operated. The trade-offs concern who takes greater responsibility for the security architecture and implementation.”

That creates a difficult balancing act for enterprise IT leaders. Hyperscalers provide vast security ecosystems, but sovereign environments may offer stronger alignment with local governance and reduced exposure to foreign legal frameworks. As a result, many enterprises are now adopting blended approaches in which sensitive workloads remain within sovereign or private infrastructure while other services continue to run on public cloud platforms.

Thorer says the market increasingly views security as a set of trade-offs rather than an absolute choice. “Sovereign and regional solutions are often associated with greater control over data access and reduced exposure to external jurisdictions,” she explains.

“At the same time, some organizations express concerns about the relative maturity of security capabilities, particularly when compared with the scale of investment and threat intelligence available to global providers.”

AI is adding even more urgency to these discussions. AI inference and machine learning workloads are generating enormous amounts of sensitive data, often requiring localized processing and lower-latency infrastructure. Tim Pfaelzer, SVP and general manager, EMEA at Veeam, says sovereignty requirements are intensifying operational complexity inside already fragmented data environments.

“Sovereign cloud initiatives are emerging as a way to address this by giving organizations greater control over data residency, governance, and regulatory alignment,” he says.

“Yet, for many enterprises, these initiatives increase the risk of fragmentation and siloes. Data is already scattered across hybrid and multi-cloud environments, so sovereign requirements simply add another layer of complexity to an existing problem.”

That challenge is pushing enterprises toward more portable and workload-aware infrastructure strategies that deliver the secure cloud services businesses need to meet their expanding data challenges.

The future cloud market will be hybrid and policy-aware

The rise of the sovereign cloud does not signal the collapse of hyperscale computing. Instead, it reflects a broader evolution in how enterprises think about infrastructure. Businesses are becoming more selective and policy-driven about where workloads should run. Rather than defaulting automatically to public cloud environments, enterprises are distributing applications based on compliance, resilience, latency, performance, and geopolitical exposure.

Mark Pestridge, managing director at Telehouse Europe, says the market is entering a more mature phase of cloud adoption. “The biggest change is that sovereignty has moved from a legal consideration to an infrastructure design decision,” Pestridge says. “Workloads are being placed more deliberately, with sensitive data often kept in-country while less sensitive services remain distributed across larger cloud platforms.”

That philosophy increasingly defines the emerging post-cloud era.

Pulsant’s CTO Mike Hoy believes the future will be driven not by abandoning hyperscalers, but by building more intelligent hybrid architectures. “Over the next three to five years, the UK will head into a multi-cloud, sovereignty-led era rather than a wholesale shift away from hyperscalers,” Hoy says. “It will be driven by decisions about where to place sensitive workloads, compliance, resilience, and operational control.”

Ultimately, enterprises are recognizing that no single infrastructure model can satisfy every requirement simultaneously. The future enterprise stack will likely combine hyperscale cloud platforms, sovereign cloud environments, edge computing, private infrastructure, and regional providers in carefully orchestrated hybrid architectures.

As explored in Part 1 of this series, the cloud-first era is evolving into something far more nuanced. The next phase of enterprise infrastructure strategy will not be defined purely by scale, but by flexibility, resilience, governance, and control.

Part 3 of Post-Cloud Strategy: What Comes After Hyperscale? explores how IT leaders are designing hybrid-by-default architectures that balance cost, performance, operational resilience, and sovereignty across increasingly distributed environments.

Red Hat is expanding its sovereign and private cloud capabilities in a move it says will give organizations greater control over tech stacks and data.

The expansion of sovereignty features will offer users five new capabilities for those operating under Red Hat Confirmed Stateside Support and Red Hat Confirmed Sovereign Support for the EU, the company said.

Chief among these is an expanded compliance framework to automate audit preparation, with new Compliance Profiles for the Red Hat OpenShift Compliance Operator.

These, combined with Red Hat Advanced Cluster Security for Kubernetes, allow organizations to automate technical reviews.

The idea is to make it easier to generate appropriate evidence for regional and industry regulations such as NIS2, GDPR, and DORA, and to keep up with new regulations as they evolve.

Elsewhere, Red Hat is also launching a new cross-platform installer, delivering automated, pre-configured isolated computing platforms across Red Hat Enterprise Linux, Red Hat OpenShift, and Red Hat Ansible Automation Platform.

"By enforcing operational guardrails at launch, these landing zones turn reference architectures into deployable infrastructure," said the firm.

"This approach reduces time-to-value for hardened and compliant workloads without requiring manual configuration of baseline controls."

New Red Hat OpenShift, Lightspeed features

Announced at the company’s flagship summit in Atlanta this week, enterprises will also gain access to a new service provisioning interface. The company said this aims to help partners and customers deploy virtual machines (VMs), clusters, and AI service on OpenShift more efficiently.

These tools can then be used to provide GPU as a Service, Models as a Service, and Inferencing as a Service as components within private clouds, helping to maintain control of the AI model lifecycle.

Notably, on-premises telemetry for data sovereignty is a key focus for the company, with Red Hat Lightspeed now providing cost management tools for OpenShift that remain entirely within customer-controlled environments.

"This capability gives organizations comprehensive visibility into cloud spend while maintaining data residency, helping to eliminate the need to transmit operational data across sovereign boundaries," the company said in an announcement.

Software supply chain gains

Red Hat says it plans to localize the software supply chain to help mitigate risks associated with regional disruptions.

Efforts on this front will start in the EU initially, with in-region content delivery allowing customers and partners to download Red Hat Enterprise Linux locally.

The company plans to expand this regional network to additional products by the end of 2026.

"Innovation should not be a trade-off for control. Whether an organization is meeting jurisdictional mandates or reclaiming its data from proprietary silos, we are providing the capabilities and platforms to build a more self-determined future," said Red Hat senior vice president and chief product officer Ashesh Badani.

"Red Hat is focused on helping the organizations that use these technologies to drive the next decade of AI and cloud innovation on their own terms.”

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Westcon-Comstor has announced an expansion of its cloud marketplace capabilities through participation in Microsoft’s resale enable offers (REO) program.

Designed for channel-led selling, the initiative combines hyperscaler reach with value-added services to help support scalable marketplace growth.

Software vendors can authorize approved channel partners to create and manage private offers on their behalf via Microsoft Marketplace, with the Redmond giant handling customer billing and payment collection.

Westcon-Comstor will also provide a range of value-added services designed to help partners build scalable marketplace practices – including partner enablement, incremental revenue tools, as well as support across renewals and the full customer lifecycle.

By combining Microsoft Marketplace with its own technical expertise, the distributor said partners can unlock cloud commit budgets, accelerate deal cycles, and expand customer spend while maintaining control over the relationship.

“Hyperscaler marketplaces are redefining how enterprise software is bought and sold, but success for channel partners and vendors depends on turning activity into repeatable business,” explained Peter Woest, Westcon-Comstor’s cloud marketplace partnership director.

“By wrapping Microsoft Marketplace with our value-added services and technical marketplace expertise, we’re making simplicity and scale a reality and allowing partners to quickly establish, build and grow their Microsoft Marketplace business.”

The reseller's participation comes amid significant cloud marketplace growth. According to research from Omdia, cloud marketplace software sales are expected to grow from $30 billion in 2024 to $163 billion in 2030, with partners tipped to be the driving force behind most marketplace spend by next year.

Westcon-Comstor said the REO program is already gaining traction, with the firm supporting partners in onboarding to marketplace-driven opportunities with vendors such as Palo Alto Networks and Infoblox.

The distributor also revealed it is in discussions with “several other vendors” regarding future collaboration opportunities with Microsoft REO.

Commenting on the move, Microsoft’s marketplace channel lead, Darren Sharpe, said the priority is to help partners build an effective, platform-first marketplace practice, backed by a strong ecosystem support.

“Westcon‑Comstor is helping partners drive momentum through REO, enabling vendors to extend their reach while keeping the channel at the centre of the customer relationship,” he added.

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Frustrated with “sovereign cloud" offerings that it says are nothing of the sort, CISPE has launched a new framework aimed at helping enterprises check if they’re getting exactly what they’re paying for.

CISPE’s Sovereign and Resilient Cloud Services Framework has been developed, defined, and tested by European cloud infrastructure providers, the trade body said in a statement.

The new scheme will allow businesses to easily select cloud services that have been audited to verify their sovereign and resilience credentials.

The aim is to provide a clear, certifiable definition of control in cloud services, helping customers and public authorities identify offerings that give them effective control over data, infrastructure, workloads, and operations.

“Think of the CISPE Sovereign Badge as ‘puncture-proof tyres’ on a car: it guarantees immunity from external interference with your cloud services or data," said Francisco Mingorance, secretary general of CISPE.

"By contrast, the CISPE Resilient Cloud Service Badge represents ‘run-flat tyres’ — you may encounter disruption, but you can continue your journey without losing control.”

The framework has two strands. First and foremost, sovereign services must ensure control by design – meaning they're owned, governed, and operated within the relevant jurisdiction and prevent foreign powers from accessing, interfering with, or disrupting them.

Meanwhile, resilient services ensure control by capability, CISPE said. Even where some non-sovereign elements exist, customers retain control through robust technical and operational safeguards.

These include customer-managed encryption, portability, independent backups, and the ability to switch providers or redeploy workloads.

CISPE said that more than 40 services have already been declared against the CISPE framework, including sovereign and resilient European AI assistant services, public cloud, Kubernetes, and storage offerings. More compliant services are expected in the coming weeks, it said.

Tackling “sovereignty washing”

The trade group has long been concerned about “sovereignty washing”, arguing last year that the EU Cloud Sovereignty Framework did little to reduce reliance on American cloud providers and hyperscalers.

"Rather than bringing clarity, the Framework muddies the waters by introducing a murky 'sovereignty score' that averages the impossible with the irrelevant," it said.

"In practice, most European cloud service providers are likely to score lower than foreign hyperscalers under this system – perhaps that’s the idea – preserving the status quo under a cloak of “sovereignty."

Last month, the group wrote to Henna Virkkunen, the EU’s EVP for Tech Sovereignty, expressing concerns about the upcoming Cloud and AI Development Act (CAIDA).

The letter called for a number of actions aimed at shoring up sovereignty capabilities across the region, including:

• Sovereignty by control, focusing on ownership, governance, and legal protection.
• Stronger resilience where sovereign services are not available.
• Reserved procurement shares for EU-based cloud providers.
• A policy reinforcing competition and interoperability.
• Taxpayer-funded investment in European companies.

"This first comprehensive European cloud policy should strengthen Europe’s digital capacity by prioritizing procurement and investment in sovereign European solutions that foster a competitive cloud ecosystem," the trade group said.

"If it instead enables 'sovereignty washing' or procurement strategies that further entrench the dominance of non-European hyperscalers, it risks undermining the very objectives it seeks to achieve."

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Google Cloud Next 2026 is just days away, and by the end of the week IT leaders will have a huge list of new products and offerings across the hyperscaler’s cloud, AI, and security portfolios to pore over.

This year’s event finds Google Cloud in a strong position. In Alphabet’s Q4 earnings, it reported a 48% year on year increase in Google Cloud revenue, driven primarily by demand for its AI platform and core cloud products.

Much of this spending, to date, has been from enterprises embarking on AI adoption and looking to use embedded Gemini features within their workplace. The value proposition going forward is for far more radical changes within the workplace, with AI agents automating more roles and delivering firm return on investment for IT leaders.

Businesses have had a year of hearing about the changes agents can usher in, and the value they can deliver. If they’re sold on that vision, they need to know which platforms deserve their investment now – which makes this year’s event especially pivotal for Google Cloud.

The opening keynote title this year is particularly vague: ‘The agentic cloud’. Needless to say, AI agents will be a key focus here, as with every major tech event right now. But Google Cloud has a unique opportunity here to explain why it’s the best vendor for a truly AI-native cloud, and how its agents can deliver better performance at a lower cost than its competitors.

Neither Microsoft nor Amazon create frontier, trillion-parameter AI models. If Google plays its cards right, it can capitalize on this first-party offerings gap to entice enterprise customers further into its cloud ecosystem. Google Cloud Next 2026 must answer two key questions: why Gemini? And why Google Cloud?

Infrastructure as a USP

The biggest bottleneck for AI training and inference at scale continues to be compute. Nvidia and AMD are going head to head trying to service an explosion in demand for hardware that can run AI workloads, and even Arm has entered the first-party chip market with a CPU designed for running AI agents at scale.

What makes Google stand out here is its global cloud infrastructure, which smoothly handles an unimaginable amount of data in the form of the world’s searches, YouTube videos, emails, and more. Beyond scale, Google has also spent years specializing its chips for AI workloads, resulting in its tensor processing units (TPUs).

Last year, we heard about Ironwood, Google’s TPU v7 designed to provide the raw computational power needed to train and run frontier AI models at the enterprise level.

I wouldn’t be at all surprised if this year’s TPU upgrades, which I’ll call TPU v8 for ease, come in the form of two distinct offerings. One, like last year’s Ironwood, would push the boundaries of compute in direct competition with the likes of Nvidia Rubin. The other could be fully optimized for AI inference, to efficiently meet the massive inference demands of AI agents.

Microsoft announced such a chip in January, the Maia 200, which it said offers better performance per dollar than Google TPUs and AWS Inferentia.

Rival labs can claim their models are better than Gemini, and credibly so in the case of the latest GPT and Claude Opus releases. But none train and run their models on in-house hardware that was designed in collaboration with their developers.

This has a knock-on effect for the cost of running agents. If Google Cloud can demonstrate that TPUs are the best choice for low-cost deployment of AI agents – and potentially low-effort, through platforms like Vertex AI Agent Builder – it will win hefty business investment.

Anthropic recently signed a deal for 3.5GW extra TPU capacity, in addition to an October 2025 deal to take control of up to a million TPUs in 2026. This is good news for Google, but it also demands answers such as which chips will Anthropic use and what, if any, are the benefits of choosing Gemini over Claude on Google hardware?

There’s a twist in the tail this year, in the form of OpenAI’s repeated infrastructure cancellations, first dropping its plans for Stargate UK and next for Stargate Norway. Not only do these roadblocks for OpenAI free up room for Google Cloud to shout about its infrastructure successes, Google itself is reportedly looking to rent the newly-vacant capacity at Nscale’s Stargate UK cluster.

This could provide headroom for more regional expansion in the UK, as well as diversify Google’s hardware stack in the region further (Nscale will use Nvidia chips in the facility).

If Google Cloud can knit all of this together, it can make a strong argument for the resilience, reach, and power of its AI infrastructure.

All eyes on Wiz

Last year’s event took place just before Google completed its $32 billion acquisition of Wiz, which will be rolled into Google Cloud while retaining its brand. Nearly one year on, I’m expecting to hear a lot about how Wiz has been integrated into the Google Cloud Platform (GCP) and where it’s already delivering results.

The addition of Wiz seriously expands Google Cloud’s ability to detect and protect cloud assets, with the two now combining their proprietary AI approaches in a unified security platform. But the other major benefit for Google is what Wiz brings in the multi-cloud domain.

In its announcement of the acquisition, Google highlighted that Wiz will continue to work on “all major clouds,” and that by combining forces Google Cloud customers will be better equipped to protect themselves across all their cloud environments.

With threat actors now using AI as a standard tool for attacks, enterprises and small businesses alike could be won over by the promise of automated cloud security that extends across their entire cloud estate.

Leaders could also be more willing to increase their Google Cloud spend in the knowledge that they can still protect assets in other cloud environments, which would allow Google to undermine the USPs of competitors such as AWS and Microsoft Azure.

I’ll be listening closely to what those within Wiz have to say about the deal, and where Google Cloud thinks the firm will best slot into its operations.

Will Gemini 4 be announced?

A question that’s undoubtedly on the minds of many attendees ahead of Google Cloud Next 2026 is whether a surprise release for Gemini 4 is on the cards.

While model release cycles are undoubtedly speeding up – Anthropic has announced five frontier models in as many months, including its gated cybersecurity model Claude Mythos – I think it’s quite unlikely that we’ll see a fully-fledged Gemini 4 at the event.

Google has a track record for this. Its frontier Gemini models tend to release around February or March, with talks at Google Cloud Next focused heavily on the enterprise capabilities of the latest model but never taking the event as an opportunity to announce a brand new one.

Gemini 1.5 Pro was the focus at Google Cloud Next 2024; Gemini 2.5 Pro was the focus at Google Cloud Next 2025. This year, we’re just a few months on from the launch of Gemini 3.1 Pro and unless Google DeepMind breaks form to speed up releases, technical demos will likely focus on the practical uses for this latest model.

Sorry AI fanatics, I just don’t see Gemini 4 being on the roster.

Expect lots of mentions for Google DeepMind’s less enterprise-focused models, though, such as image generator Nano Banana 2, music generator Lyria 3, and video generator Veo 3.1. Is the link between garish AI images and enterprise bottom lines tenuous at best? Absolutely. Will I be posting photos of said images being shown off at the opening keynote? Without a shadow of a doubt.

Nevertheless, Gemini will once again be the star of the show at Google Cloud Next 2026. Expect to hear about how it powers many of the features announced in the opening keynotes, as well as how businesses can use it to build more automation into their daily activities.

Rory Bathgate will be covering Google Cloud Next live from Mandalay Bay, Las Vegas between 22-24 April. To stay up-to-date with the latest news and announcements from the conference, follow our live blog and subscribe to the ITPro newsletter.

The European Commission has awarded a tender worth up to €180 million to procure sovereign cloud services for EU institutions, bodies, offices, and agencies over six years.

The tender was launched in October 2025 with the aim of strengthening the digital sovereignty of EU bodies and encouraging the market to offer sovereign solutions.

Requirements included strategic, legal, operational, and environmental considerations, along with supply chain transparency, technological openness, security, and compliance with EU laws.

Four providers and consortiums have been awarded contracts under the scheme, including:

• A Luxembourgish-French partnership led by Post Telecom, with partners CleverCloud and OVHcloud
• Germany's StackIT
• France's Scaleway
• A Belgian-French-Luxembourgish partnership, led by Proximus

The latter of these uses services from S3NS, a joint venture between Thales and Google Cloud. Clarence and French-based AI firm Mistral are also involved in the Proximus-led consortium.

"What’s interesting here is that technological sovereignty isn’t simply a theoretical concept: it translates into actual infrastructure and platforms with players able to operate together at a production level," commented Quentin Adam, CEO of Clever Cloud.

"This is also proof that European organizations can cooperate effectively and drive progress across the entire ecosystem.”

EC justifies Google Cloud involvement

The Commission justified the involvement of Google Cloud by saying that non-European technologies can meet the minimum level of sovereignty required by operating within a 'strict and appropriate' framework.

"While sovereignty was an important factor, the selected providers had to demonstrate that they can provide reliable, state-of-the-art technology and services, with a strong focus on fully managed services (PaaS), developer experience and automation," said the Commission.

"All awarded providers deliver a high level of technical quality for that scope, showing that EU providers are closing the gap. All awarded providers also achieve strong security ratings, demonstrating an excellent coverage in terms of security certifications."

High expectations

The providers were required to hit a Sovereignty Effectiveness Assurance Level (SEAL) of SEAL-2 - Data Sovereignty - requiring them to abide by EU laws and regulations without the need for additional technical measures by customers to protect their data.

Most of the awarded providers, in fact, reached SEAL-3 – Digital Resilience level – meaning that their service, technology or operations are immune from supply chain disruption from non-EU third parties.

"By successfully introducing sovereignty in its cloud procurement, the Commission leads by example in advancing Europe’s digital sovereignty, setting a benchmark for secure, compliant, and values-based cloud adoption across the public sector," the Commission said.

"The success of the tender highlights the high quality of European providers, demonstrating their ability to meet the Commission's strict criteria. It also shows that even non-European technologies, when operated within a strict and appropriate framework, can meet the minimum level of sovereignty required."

In future, the Commission plans to apply the sovereignty criteria it's developed to assess and enhance sovereignty across the digital services that it provides to its departments and other EU bodies.

It will also publish an updated version of the Sovereign Cloud Framework, based on what it's learned from this tender. process, which will be available to all.

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Oracle is betting big on the scalability and reliability of its cloud offerings, as it looks to convince customers that off-the-shelf AI agents grounded in secure data can meet business needs better than the bells and whistles of its competitors.

In the opening keynote at Oracle AI World Tour London, Oracle CEO Mike Sicilia said mass adoption of generative AI has rapidly accelerated the pace of innovation and demand for new breakthroughs.

“Expectations in the age of AI haven't simply risen,” Sicilia said, “they've reset entirely and remarkable things that felt out of touch just a few years ago, a few months ago, and in some cases just a few weeks ago, are now the new normal.”

To meet this demand, he said, Oracle is looking to reengineer the cloud behind the scenes so that enterprises can adopt, deploy, and manage their data and enterprise AI tools as easily as possible.

Nothing Sicilia said on stage would have come as a great surprise to attendees. In fact, the most surprising thing to me throughout the keynote was the confidence with which Oracle is promoting its ‘stay the course’ approach to cloud and AI in 2026.

Scalable cloud for reliable AI

Oracle’s pitch is simple: scale and stability. Rather than becoming overcomplicated with AI additions, Oracle intends for Oracle Cloud Infrastructure (OCI) to facilitate AI adoption. This is a ‘more is more’ approach to customer choice.

Sicilia argued that only with dependable cloud infrastructure and the option for customers to choose their own AI model, data formats, and cloud residency, can AI success really be achieved.

“It’s no secret that at Oracle, we are building the world’s largest AI cloud,” Sicilia said.

“We think that this will all show up where the work actually happens, and that is servicing the AI directly in the applications and workflows that you're already living in, right at your fingertips. Whether you're in finance, HR, manufacturing, retail, healthcare, financial services and beyond.”

At Oracle AI World Tour London 2026, the firm unveiled 22 new Fusion Agentic Applications in line with this goal, powered by off-the-shelf AI agents trained in enterprise-specific tasks including identifying sales opportunities, coordinating supply chain operations, and automating cash flow.

We’ll have to wait and see if these agents deliver a real return on investment.

While data and fine-tuning play a major role in the success of AI deployment, Oracle sticks out as a hyperscaler without AI models of its own. Google Cloud offers its customers first-party Gemini offerings and Microsoft Azure boasts privileged access to OpenAI’s model catalog. AWS – which doesn’t spring to mind when I hear ‘frontier model developer’ – has put in work with its Nova model family, even if analysts question its confidence in the offering.

Oracle, by contrast, has no models of its own, nor an exclusivity deal with a major frontier lab. Though it was quick to form partnership with AI developer Cohere in 2023, whose models form the basis for Oracle NetSuite’s generative AI features, Oracle has subsequently bet on an agnostic approach.

Let’s get this out of the way: there’s obvious merit for the strength of OCI for running intense compute for enterprise AI. This is particularly when it comes to tasks such as training and fine-tuning LLMs, as Steve Miranda, EVP of Oracle Applications Development, explained to assembled media at the event.

“We have significant technical advantage in OCI, especially around the speed of network and security, which is why the Nvidia infrastructure runs best on OCI, which is why most, if not all, the top large language models in the world have chosen OCI to train their models,” said Miranda.

I suspect, however, that this won’t matter so much at the enterprise level. Business leaders aren’t generally looking to train or even fine-tune their own LLMs, they’re looking to deploy whichever pre-made AI tool delivers them the most value.

Customers willing to forgo flexibility and an open ecosystem in the name of the latest end-to-end AI deployment may find their head turned by Azure with its OpenAI tie ups, or the first-party model developer Google Cloud.

In the face of this competition, Oracle’s commitment to openness reads more like a bet against AI innovation, not for it. The offerings that Oracle thinks are make or break for customer retention aren’t AI at all, but Oracle Databases.

Indeed, Oracle has even gone to the length of partnering with other hyperscalers to make Oracle AI Database services available alongside competitor offerings. In these circumstances, customers can make use of OCI Exadata hardware directly next to, or even in, data centers run by AWS, Azure, and Google Cloud for low latency ease of access. This could be a major draw for customers looking for a low-friction, multi-cloud approach.

Nathan Thomas, SVP of product management, OCI at Oracle, explained how customer demand has driven OCI to support a varied, multi-cloud strategy.

“We hear from customers all the time that they want to use their AI pipelines in those environments,” he said.

“They want to be using Vertex, they want to be using Copilot, Sagemaker, Bedrock, and they want to have their data local to that, low latency, high performance, accessibility to it. But they still need to take all the governance with them.”

Over the long-term, Oracle is betting that customers will stick with it for both its openness and consistent, full-stack approach. Frankly, it’s too late to now change course – it can’t compete with the likes of Google Cloud for walled-garden AI capabilities and it seems to know this.

“There is nothing special, from a technical perspective, about the agents we build,” Miranda said, adding that the framework Oracle lets customers run its agents in a wide range of agentic frameworks.

Customers may choose stability, and neutrality, over specialization and the potential for lock-in when they choose their cloud provider. The uphill challenge for Oracle is convincing customers that this ‘nothing special’ approach is enough to give them an edge over competitors.

A simple and scalable foundation for enterprise data

Sicilia says one of Oracle’s major strengths is there’s “only one version of OCI”, allowing customers to plan for deployment without having to plan for compromises or region-specific versions.

“The form factor, the physical location, whether or not it's consumed in a multi-cloud environment, it doesn't matter,” he said.

“There's one version and that is, we think, to the customer’s advantage because we're able to look at all of the services, 100% of the services, no matter how big or how small the data center is, no matter how big or how small the consumption model is, as well as all the same privacy, security, cyber defenses.”

Thomas explained that Oracle’s approach allows customers to trust in a consistent application experience. He added that specializing in the creation of small clouds has fed directly into Oracle’s capacity for running private, distributed cloud regions directly in customer data centers, an offering he described as “a huge part of our sovereignty play”.

While digital sovereignty is a huge focus for hyperscalers, Oracle hopes its full-stack approach – as outlined by Sicilia – will help it stand out from the competition.

“This is an area where we really feel like a lot of the other cloud vendors have been let off the hook,” Thomas said.

“There's some sort of idea that, ‘hey, what OCI is doing is super special or different’. We kind of think that's backwards. You know, every cloud really should by default be able to scale down, like we've got all 150 OCI web services available on all of those form factors, the pricing is the same in all those environments, and it’s still metered billing the way that we have in any public region.”

Oracle is striving to meet rising demand for sovereign cloud in Europe amid geopolitical uncertainty and a push for reduced reliance on US cloud providers. The strength, in practice, of sovereign cloud controls compared to those offered by competing hyperscalers depends on the level of separation customers desire and unknowns such as the US CLOUD Act.

Like its competitors, Oracle argues that it offers ‘operator sovereignty’, allowing workloads segregated from the public cloud to be run not just within specific regions but by staff who are residents of that region. But this wouldn’t be enough to protect EMEA data from the US CLOUD Act, should Oracle choose to comply with a government directive to access data.

With geopolitics where it is, I suspect Oracle is making the argument a few years too late. European giants such as Airbus reportedly moving critical apps to a sovereign European cloud and White House PR surrounding Oracle becoming TikTok’s US secure cloud provider may have strengthened the association between the firm and the US government in the minds of EMEA customers.

It feels to me like sentiment toward US cloud providers across EMEA only goes in one direction right now, no matter how enticing the offer. In these conditions, Oracle may need to do more to lure new customers in and this may mean going beyond the slow and stable approach to which it’s currently committed.

Cloud maturity is having a direct impact on AI adoption, new research suggests, with only 14% of firms at the highest level of expertise.

According to NTT Data's new report, Cloud-led innovation in the era of AI: The new rules for driving value with cloud, while 99% of organizations say AI is increasing demand for cloud investment, 88% say current levels of spending are putting AI, cloud native, and modernization initiatives at risk.

Notably, as expectations rise, there's a disconnect between ambition and reality, the company warned. While the cloud is seen as essential for innovation, fewer than half of organizations said they were satisfied with its impact, or with the progress their modernization efforts were making.

“AI is accelerating faster than enterprise cloud maturity,” said Charlie Li, president, global head of cloud and security at NTT Data.

“Cloud has moved well beyond infrastructure and is now the execution layer for AI. Organizations that fail to evolve their cloud foundations risk constraining the growth and value of their AI investments."

Cloud leaders or organizations that indicated they were “cloud evolved” – the most advanced in terms of cloud adoption and impact, and with solid business performance – are significantly better positioned to capitalize on AI, said NTT.

The firm's advice is to develop cloud and AI strategies in tandem: AI demand is rising, it said, but alignment is uneven. chief AI officers (CAIOs) were 22% more likely than CIOs and CTOs to say that AI increases cloud investment needs, while AI is cited as the top cloud skills gap.

Cloud architecture choices are crucial, with organizations increasingly adopting a mix of public, private, hybrid and sovereign cloud models. Nearly all respondents told NTT they expect private cloud growth and sovereign cloud adoption to grow 50% in two years.

However, despite widespread agreement that cloud should drive innovation, half said legacy applications and data platforms are holding it back. Modernization is the top priority for the next two years.

Similarly, as investments stall and environments become more complex, more than half cited cloud cost management challenges, with organizations expecting a threefold increase in fully managed cloud platforms.

Mastering the cloud

Organizations should reset their cloud transformation KPIs, according to NTT Data.

Although AI is critical in helping organizations shift from technical to business metrics for cloud initiatives, adoption remains uneven. Nearly half of cloud leaders used AI in their last cloud migration project, compared with just a third of the rest.

Elsewhere, NTT Data noted that while security is the top cloud investment priority, confidence remains uneven, with 68% of the leaders feeling highly confident, compared with 36% of all others.

Leaders are also much more likely to define clear roles and responsibilities backed by regular audits.

"Our clients who are succeeding are treating cloud as a value creator, not a technology initiative," said Li.

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Red Hat has expanded its partnership with Google Cloud in a bid to supercharge legacy infrastructure modernization and cloud migration.

As part of the deal, Red Hat OpenShift will now be integrated with the Google Cloud console, making life easier during onboarding and when managing workloads alongside Google's own native compute.

Similarly, Red Hat said OpenShift Virtualization is now available on Red Hat OpenShift Dedicated on Google Cloud, letting customers use traditional virtual machines (VMs) and modern containers in the same place.

“Red Hat’s hybrid cloud vision is built on consistency – the ability to run any workload, anywhere, with the same operational model," said Mike Barrett, vice president and general manager of Hybrid Cloud Platforms at Red Hat.

Red Hat OpenShift on Google Cloud Console

The integration of Red Hat OpenShift with Google Cloud console will help streamline workload optimization on the platform, the company said, and simplify onboarding processes.

"Red Hat OpenShift Dedicated users can natively validate Google Cloud prerequisites before transitioning to a guided cluster provisioning flow within the Red Hat Hybrid Cloud Console," the company noted.

The integration will also simplify billing and procurement, with pay-as-you-go billing through Google Cloud Marketplace that applies their Red Hat subscription against Google Cloud spend.

Beyond that, the deeper collaboration allows for native service integrations, with support for services including Google Cloud Secret Manager, Certificate Authority Service, and Workload Identity Federation.

“Our customers are constantly looking for ways to simplify their infrastructure and accelerate innovation without sacrificing performance," said Nirav Mehta, vice president of Product Management for Google Cloud Compute Platform at Google Cloud.

"Customers now have a smoother path, enabling them to run both virtualised and containerized workloads consistently on Google Cloud's global, secure, and performant infrastructure."

Red Hat OpenShift Virtualization

Red Hat OpenShift Virtualization is designed to help enterprises modernize legacy infrastructure at their own pace, using modern containers in a way that lets old and new work together.

The tool allows traditional VMs to work seamlessly with more modern containers and serverless workloads on a consistent Kubernetes platform, the company said, letting users have a single interface, toolset and operational practices across workloads.

Additional tools, such as a migration toolkit and Red Hat Ansible Automation Platform, also aim to make shifting to modern systems easier.

Beyond upgrades and migration, RedHat OpenShift Dedicated on Google Cloud offers easy scaling and more predictable performance, Red Hat said.

"This extended collaboration with Google Cloud further empowers organisations with comprehensive cloud native capabilities of Red Hat OpenShift, whether they need to accelerate application development or streamline migration to the cloud," said Barrett.

"Together, Red Hat and Google provide a clear, unified path for organizations to modernize their entire application portfolio, helping them manage both their traditional VMs and containerized applications on a single platform."

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The Met Office has marked one year since it transitioned to cloud supercomputing hosted in Microsoft Azure to generate its critical weather data.

Best known for its weekly weather forecasts, the Met Office is a trading fund within the UK government. But beyond its role at a consumer level, it’s also a critical partner for government and industry as the unique provider of past and present weather data, as well as detailed projections for real-world decision making.

Charles Ewen, chief data and information officer at the Met Office, told assembled media that since partnering with Microsoft in 2024, the Met Office has worked to improve its scalability, flexibility, and resilience while also markedly increasing its compute capacity.

This is the Met Office’s first foray into enterprise-scale cloud computing, and as of last year, has seen the organization move away from on-premises computing for its forecasts.

Microsoft now hosts a cloud cluster for the Met Office, which delivers approximately 60 petaflops of computational performance for functions that could normally only be carried out on a scientific supercomputer, such as climate simulations and weather forecasting.

Ewen explained that cluster is one of the top five CPU clusters in the world, with 1.8 million cores operating at three-nines uptime.

The Met Office’s history of innovation

The Met Office has a storied history of supercomputing, having first used the EDSAC computer at Cambridge in 1952 and in 1959 adopting its first full-time forecasting computer in the form of a Ferranti Mercury computer dubbed ‘Meteor’.

In the decades since, the organization has been through numerous upgrades and reinventions. Even the past 18 years have marked major shifts.

When Ewen joined the Met Office, it was still authoring its own relational databases, he noted, adding that even then it was “an odd thing to be doing”.

The Met Office is now chasing collaboration, agility, scalability, and resilience across all its systems – a process that Ewen described as a significant overhaul.

Chasing resilience

Indeed, uptime and operational resilience were key drivers for the Met Office in partnering with Microsoft and migrating to its cloud supercomputer offering.

One year on from going live on Azure, the Met Office is now recording 99.95% availability for its integrated services, 99.77% supercomputer availability, and 100% critical workload availability.

Erin Chapple, CVP for Commercial Solution Areas at Microsoft, explained that the Met Office is making full use of Azure’s managed services, validated models, robust data workflows, and resilience.

“The platform is delivered with telemetry really built in as the standard and at the scale we operate, it allows us to focus on large-scale identification and resolution of incidents,” Chapple said.

“So the observability and the levels of automation that we have right really have eclipsed what we have been able to deliver in [the] past on premises, leading to identification of issues faster and quicker resolution. This also really enables us to support long running workflows in a consistent manner with minimal or zero impact on those jobs.”

This last point is critical for Met Office operations, Ewen explained, as many of its ongoing scientific research projects last for “ten or more years” and need constant variables to produce usable results.

“So the ability to maintain that direction of travel, to continue to develop pioneering science and understanding, to be able to implement that in next generation codes on new technologies, is vital.”

Ewen added that with the built-in telemetry possible on Azure, the Met Office can now identify and address large-scale incidents at a level not before possible.

“So the observability and the levels of automation that we have really have eclipsed what we have been able to deliver in the past on premises, leading to identification of issues faster and quicker resolution,” he explained.

For digital sovereignty purposes, Microsoft offers workloads based in the UK and provides dedicated protections for data sovereignty.

New frontiers

In February, the Met Office announced it had implemented a new and improved weather model, which would not have been possible without its Microsoft partnership.

The new model allows for more accurate local and global forecasts, driven by improved model physics, a greater range of aircraft data, and an overhaul of the Met Office’s prediction system.

Practically speaking, this means the Met Office is now able to produce more realistic rainfall forecasts, better cloud cover forecasts – hugely important for helping schedule aircraft take-offs, for example – and better UK temperature predictions.

The new model is also able to extend forecasting to 10 days, allowing for better medium-range predictions that feed directly into private sector and military decision-making.

Ewen said the Met Office and Microsoft have now formed a true partnership and that the two will continue to work together on meteorological and climate breakthroughs.

Although the bulk of the organization’s work is rooted in computational physics, Ewen acknowledged that AI is a potential catalyst for innovation. The Met Office will continue to assess the role a hybrid approach to AI and traditional compute can play, he explained, but he cautioned against focusing on it too much.

“People are struggling because they're looking through the narrow lens of, typically, AI at the moment and before that, it was cloud,” he said.

Going forward, Ewen said the Met Office will build on its trusted partnership with Microsoft to maintain its national reputation and deliver groundbreaking research.

“Of course, real world progress is measured in our outputs,” Ewen said.

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Datadog is planning to expand into the UK with the launch of a new data center presence offering local storage for operational data.

According to the firm, the UK data center is expected to open later this year and comes in response to accelerating cloud adoption across regulated industries, along with evolving data governance and security requirements.

Keeping data in-region also allows organizations to reduce latency and use Datadog’s observability and security platform from a single UK-resident environment – crucial for companies operating in regulated environments such as government, banking, healthcare, and higher education, the firm said.

“As more organizations modernize and run critical systems in the cloud and deploy AI, where operational data is stored has become a practical constraint, not just a compliance question,” said Yanbing Li, chief product officer at Datadog.

“For the public sector and highly regulated industries such as financial services and healthcare, storing data locally is critical. The UK data center presence gives customers a way to adopt modern observability and security without compromising in-region data storage.”

Capitalizing on cloud adoption

Cloud adoption continues to accelerate among regulated organizations across the UK, with 82% of financial services firms surveyed by the London Stock Exchange Group (LSEG) now operating in multi-cloud or hybrid environments.

In the public sector, meanwhile, annual digital technology spend exceeds £26 billion, with around 60% of IT systems running on cloud infrastructure, according to GOV.UK figures.

Crucially, companies are having to deal with evolving UK data governance, including changes introduced under the Data (Use and Access) Act 2025, which has increased focus on where operational data is stored and processed.

“The UK is one of the fastest adopters of cloud and AI technologies in Europe. Organizations here are modernizing quickly while facing increasing scrutiny around data governance and security," said Steve Barrett, VP EMEA at Datadog.

"Cloud adoption is now the norm and AI is becoming a second wave on top of it — exponentially increasing operational complexity. Expanding our regional footprint now ensures organizations have trusted, local data storage as they scale cloud and AI securely and reliably.”

The company already operates in North America, Asia and Europe, with plans for a new data center in Australia.

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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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Sumo Logic is expanding its EMEA footprint with planned availability of its AI-powered security solutions on the AWS European Sovereign Cloud and Swiss Data Center region.

The move aims to bolster support for European organizations' data privacy, sovereignty, resiliency, and security needs as they push ahead with digital and AI strategies.

Sumo Logic said the expansion will enable businesses to deploy its security analytics and SIEM capabilities while keeping data in-country or within designated time zones as demand for sovereign cloud services grows.

According to research from IDC, 63% of organizations are now more likely to adopt sovereign cloud services due to recent geopolitical events, with spending tipped to reach more than $400 million by 2029.

Despite the growing market, Eric Avery, global head of infrastructure and data at Sumo Logic, said strict data sovereignty regulations are creating barriers for many organizations – particularly across regulated sectors such as healthcare, finance, and the public sector.

“Previously, enterprises in highly regulated industries have been limited in their choice of cloud security solutions while meeting compliance requirements like Switzerland’s FADP,” he explained.

“Sumo Logic's innovations around SIEM and agentic AI, combined with AWS' European Sovereign Cloud infrastructure, provides the ideal response.”

AWS sovereign cloud and Swiss expansion

Under the expansion, Sumo Logic’s Intelligent Security Operations platform will be made available for deployments on the AWS European Sovereign Cloud to help customers operate cloud workloads in an independently governed environment while using Sumo Logic to log, track, and secure deployments.

The security vendor also confirmed plans to roll out its platform in Switzerland in an effort to better support customers that require faster in-country data processing in line with the Swiss Federal Act on Data Protection (FADP), as well as GDPR obligations.

By expanding its footprint to the AWS Swiss Data Center, Sumo Logic said organizations operating within Swiss borders will be able to leverage its agentic AI-driven log analytics and advanced SIEM capabilities to boost compliance, while benefitting from a faster, low-latency environment.

“We deliver reliable security operations that help organizations stay secure and compliant while running services locally with the performance and scale they need,” Avery added.

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Spending on sovereign cloud infrastructure in Europe will triple from 2025 to 2027, according to Gartner, with a fifth of workloads shifting to local clouds.

Analysis from the consultancy suggests worldwide sovereign cloud Infrastructure as a Service (IaaS) spending will hit $80 billion this year — up 35% from 2025.

The projection comes as Europe pushes for digital sovereignty amid geopolitical concerns and worries about overreliance on US-based big tech providers.

But it's not just Europe and the UK. Indeed, between 2025 and 2026, Gartner said European sovereign cloud spend will climb 83% from $6.9bn to $12.6bn – that growth rate is pipped by both the Middle East and Africa (89%) and the region Gartner dubs Mature Asia/Pacific (87%).

While European spending remains high – and is tipped to triple over three years to top North America at $23.1bn – the region with the highest spend on sovereign cloud remains China.

Spending in the region came in at $37.5bn spent in 2025, and Gartner forecasts this to rise to $48.4bn in 2026 and $58.5bn in 2027, with growth around 20%.

"As geopolitical tensions rise, organizations outside the US and China are investing more in sovereign cloud IaaS to gain digital and technological independence," said Rene Buest, senior director analyst at Gartner.

"The goal is to keep wealth generation within their own borders to strengthen the local economy."

Sovereign spend

Most of that spending will be from the public purse via governments, Gartner found.

Alongside the pan-European Gaia cloud, France is even shifting digital services such as video calling to locally-made products over Zoom or Microsoft Teams via the Suite Numérique project.

"Governments will remain the main buyers to meet digital sovereignty needs, followed by regulated industries and critical infrastructure organizations, such as energy and utilities and telecommunications," Buest commented.

In Europe, AWS, IBM, Google and more have all pushed sovereign cloud services via heavy investment in European infrastructure – though Microsoft has had to reassure customers that their data really will be safe from American eyes.

"To compete for local customers’ cloud business, large cloud providers must seriously acknowledge the sovereignty concerns and requirements per country, and act accordingly," added Buest.

"Solely treating digital sovereignty as a pure security, regulatory and compliance topic is not enough."

Keeping it local

The shift to "geopatriation projects," as Gartner has dubbed them, means about a fifth of existing workloads will shift from global cloud providers to local ones, the analyst house predicted.

The consultancy added that 80% of sovereign cloud spend will come from new digital projects, including shifting legacy workloads to the cloud.

Unsurprisingly, Synergy research suggests US companies dominate the European cloud market, with local providers scrapping over just 15% of the remaining market.

Although the recent shift to sovereign IaaS spending could help rebalance that, there's plenty of work to be done.

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Wasabi Technologies has raised $70 million in funding in a move the company says will propel it into direct competition with hyperscale cloud providers like AWS, Google Cloud, and Microsoft Azure.

The investment round was led by L2 Point Management and included funding pledges from existing investors like Fidelity Management & Research Company as well as flash storage provider Pure Storage.

The funding round values Wasabi at $1.8 billion and marks over $600 million raised by the firm to-date.

In a statement, Wasabi said the funding will enable it to ramp up AI infrastructure expansion plans and broaden its global footprint. David Friend, co-founder and CEO of Wasabi Technologies, said this represents a huge seal of approval for the company.

“We’re ushering in the next generation of cloud storage, powering data-intensive workloads like generative AI and autonomous systems,” Friend commented.

“This funding underscores Wasabi’s strong market position and continued growth as enterprises and AI developers alike seek a better, more predictable alternative to the hyperscalers.”

Founded in 2015, Wasabi launched its flagship “Hot Cloud Storage” service two years later, offering enterprises high-performance storage options for data-intensive applications.

“Hot” cloud storage streamlines access to data sources that are accessed frequently, as opposed to “cold” data which is typically unused. Wasabi says this approach improves efficiency for enterprises, and crucially, reduces overall costs by avoiding egress fees and vendor lock-in.

Wasabi has capitalized on the AI boom

Wasabi’s popularity has soared since the advent of generative AI in late 2022, with enterprises faced with burgeoning workloads and storage bottlenecks.

The firm’s AI product range has grown rapidly on the back of this boom period, first with Wasabi AiR, and more recently with the launch of Wasabi Fire, an NVMe storage option for AI and machine learning training.

Today, the company boasts more than three exabytes of data under management and operates in 16 global regions.

“AI is changing the way enterprises manage and store data. Wasabi is demonstrating strong execution in delivering scalable, low-cost cloud storage built for AI ready data environments without added complexity or unpredictable costs,” said Krishna Gidwani, VP for strategy and corporate development at Pure Storage.

“Our investment reflects a shared focus on building the next generation of AI infrastructure that is intelligent by design and simple to deploy and operate.”

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IBM has launched a new cloud platform designed to help organizations build, deploy, and manage AI-ready sovereign environments.

Unlike other sovereign solutions, IBM said its Sovereign Core makes sovereignty an inherent property of the software itself.

Rather than relying on policy overlays or provider-managed control planes, it uses always-on controls and user-owned control planes.

Similarly, ongoing compliance capabilities are embedded directly into the software, helping organizations to produce regulator-ready proof on demand and without manual, audit-driven processes.

This, the firm said, allows organizations to maintain direct operational authority over software operations, deployment decisions, and system configurations, with no need to involve out-of-region vendors.

All authentication, authorization, encryption keys, and access management remain within jurisdiction boundaries under customer control.

IBM Sovereign Core will be available in tech preview next month, with full general availability planned for the middle of this year.

What to expect with IBM Sovereign Core

According to IBM, Sovereign Core generates, stores and manages comprehensive operational data, system telemetry, and audit trails within the sovereign boundary, including automated identity.

Elsewhere, AI model deployment and hosting, local GPU clusters, local inference execution and agent operations also take place under local governance, without the need to export data to external providers.

"The sovereign AI conversation has focused on data residency, but that's only part of the equation," said Sanjeev Mohan, principal, SanjMo.

"IBM Sovereign Core addresses the harder question: who controls the system and can you prove it to regulators? IBM takes a holistic approach spanning data, operations, technology, and assurance, with continuous monitoring," the company said in a statement.

"As AI moves into production, that kind of ongoing accountability becomes non-negotiable."

Customers can choose to deploy IBM Sovereign Core in the environment of their choice – whether that's an on-premises data center, supported in-region cloud infrastructure, or through IT service providers.

Approved providers under the scheme include Computacenter in Germany, or Cegeka, which operates in Belgium and the Netherlands.

Sovereignty in the spotlight

The move from IBM is the latest in a mass market pivot toward data sovereignty, with a host of major cloud providers now offering these services.

This week, for example, AWS announced the general availability of its dedicated European Sovereign Cloud service, aimed at allowing European customers to keep data in-region.

Enterprise concerns about data sovereignty have been creeping in across the European Union (EU) in recent years, spurred on by new legislation.

Gartner predicts that by 2028, 65% of governments worldwide will introduce some technological sovereignty requirements to improve national infrastructural independence and protect from extraterritorial regulatory interference.

Additional research from the consultancy shows more than three-quarters of all enterprises will have a digital sovereignty strategy by 2030, often based on sovereign cloud.

Long-term, this will be a booming market, according to Gartner. By 2028, the sovereign cloud market is projected to grow by 4.5 times, reaching $169 billion globally.

"Businesses are facing growing pressure to innovate while meeting tightening regulatory requirements and recognizing the importance of controlling how sensitive data and AI workloads are accessed and operated," said Priya Srinivasan, general manager for IBM software products.

"This shift is creating an urgent need for sovereign solutions that deliver AI-ready environments."

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AWS has announced the general availability of its European Sovereign Cloud, touting plans to expand the service across the continent.

The new scheme will offer European-based customers a fully independent cloud located entirely within the EU. This means enterprise data will be hosted and stored solely in the region and kept separate from other AWS Regions worldwide.

The service will be operated out of Germany, according to AWS, and underpinned by more than €7.8 billion in investment.

AWS said it plans to expand options to other European countries as part of the move, with new AWS Local Zones earmarked for Belgium, Portugal, and the Netherlands.

“The AWS European Sovereign Cloud’s unique approach provides the only fully featured, independently operated sovereign cloud backed by strong technical controls, sovereign assurances, and legal protections designed to meet the needs of European governments and enterprises for sensitive data,” the hyperscaler said in a statement.

The move by AWS comes amidst an intense focus on sovereign cloud for European customers. Spurred on by customer demands and regulatory scrutiny, a host of major cloud computing providers have launched - or are in the process of rolling out - sovereign cloud services.

Last year, for example, Microsoft launched a new sovereign cloud scheme covering private and public cloud, along with the launch of dedicated National Partner Clouds in France and Germany.

So what can customers expect from the new AWS Sovereign Cloud project?

What to expect from the AWS European Sovereign Cloud

First and foremost, the new sovereign cloud setup is “physically and logically separate” from other global AWS Regions, enabling European enterprises to meet stringent regulatory requirements on data residency and privacy.

Enterprises operating on the sovereign cloud will have “full control over where their data is stored”, the company said. This includes complete control over all metadata they create – down to roles, permissions, resource labels, and configurations.

Control of sovereign Identity and Access Management (IAM) data, billing, and usage metering systems is also guaranteed.

Crucially, AWS said the new setup places a strong focus on “operational autonomy”, meaning it’s operated “exclusively” by EU residents and has no dependence on non-EU infrastructure.

“Its unique design enables it to continue operations indefinitely,” the hyperscaler explained. “Even in the event of a communications disruption with the rest of the world”.

This aspect of the sovereign cloud scheme is noteworthy, particularly amidst growing concerns about potential US overreach and frosty transatlantic political relationships.

Last year, Microsoft was forced to reassure customers it would take legal action against the US government in the event the Trump administration pressured providers to shut down services in Europe.

The comments from Microsoft President Brad Smith followed the signing of a memorandum in early 2025 to defend US companies from “overseas extortion” in response to the EU Digital Markets Act (DMA).

Reliance on US tech providers has become a key concern for IT leaders in both the UK and EU over the last two years. A study from Civo in May 2025 showed 60% of respondents think the UK government should cut its use of US cloud services over data protection and privacy concerns.

AWS said that in the event of “communications disruption”, AWS employees located in the EU will have “independent access to a replica of the source code needed” to maintain the service.

Security and compliance gains

Elsewhere, AWS said the new sovereign cloud gives enterprises access to “leading technical and compliance controls”. These controls come in the form of the AWS Nitro System, which allows enterprises to enforce strict security boundaries and access restrictions for data held in the region.

“Nobody, including AWS employees, can access customer data running in Amazon EC2,” the company said.

“AWS also provides advanced encryption, key management services, and hardware security modules that customers can use to further protect their content. Encrypted content is rendered useless without the applicable decryption keys.”

The hyperscaler has also launched a new “Sovereignty Reference Framework”, which aims to provide enterprise customers with information and guidance on sovereignty requirements in the region, helping streamline regulatory compliance.

“Customers can use the third-party validated ESC-SRF auditor report to demonstrate clear and enforceable sovereignty assurances,” AWS said.

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Amazon Web Services (AWS) has quietly raised the prices of EC2 Capacity Blocks for machine learning, upping them by around 15%.

First spotted by The Register, the changes mean the cost of a p5e.48xlarge instance has risen from $34.61 to $39.80 per hour across most regions, while the pricing for p5en.48xlarge has gone up from $36.18 to $41.61.

There's an even bigger increase in the US West (N. California) region, where p5e rates have risen from $43.26 to $49.75.

Amazon EC2 Capacity Blocks allow GPU capacity to be booked in advance at a locked-in price, and are mostly used by large organizations with substantial cloud budgets, generally for business-critical ML training.

This gives customers guaranteed GPU capacity at predetermined times, allowing them to reserve capacity for a fixed time window, ranging from one day to several weeks, paying an agreed rate up-front.

The blocks can be reserved up to eight weeks in advance.

"With Amazon EC2 Capacity Blocks for ML, you can reserve just the amount of accelerator capacity you need to run your machine learning workloads. EC2 Capacity Blocks pricing consists of a reservation fee and an operating system fee," AWS explained in promotional materials.

"The reservation fee is charged up front at the time you schedule the reservation. Your Capacity Block is charged at the prevailing rate at the time of purchase, even if the Capacity Block is scheduled to start after the price is updated."

Why has AWS increased prices?

Capacity Blocks have always been subject to variable pricing, based on supply and demand and adjusted every quarter based on expected market conditions.

AWS has previously reduced pricing three times: once in 2024, and twice in 2025.

While demand for compute power for AI and machine learning continues to grow, supply is limited, with a global shortage of advanced GPUs.

The change comes just a few months after AWS cut prices for some GPU instances, particularly for On-Demand and Savings Plans, by up to 45%.

The hyperscaler specifically highlighted price cuts at its annual re:Invent conference in Las Vegas in December.

Capacity Blocks were not included in those reductions, though.

"Regular price reductions on AWS services have been a standard way for AWS to pass on the economic efficiencies gained from our scale back to our customers," the company said at the time.

"These pricing updates reflect the AWS commitment to making advanced GPU computing more accessible while passing cost savings directly to customers."

The next review of pricing is set for April 2026.

A spokesperson for AWS told ITPro: “EC2 Capacity Blocks for ML pricing are dynamic and vary based on supply and demand patterns, as described on the product detail page.

“This price adjustment reflects the supply/demand patterns we expect this quarter. AWS’s commitment to not raise pricing on fixed pricing models like On Demand and Savings Plans remains unchanged.”

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Global spending on cloud infrastructure continues to skyrocket, new research shows, as enterprise demand for AI moves from early tests into full production deployment.

New figures from Omdia show global spending on cloud infrastructure services reached $102.6 billion in the third quarter of this year, up 25% year-on-year and marking the fifth consecutive quarter in which growth has been above 20%.

Amazon Web Services (AWS), Microsoft Azure, and Google Cloud kept the same market rankings as in the previous quarter – collectively accounting for 66% of global cloud infrastructure spending. Together, they saw 29% year-on-year growth.

AWS’s revenue grew by 20% – its strongest performance since 2022 – with a 32% market share. Omdia attributed this growth to an easing of compute supply constraints and incremental demand driven by its partnership with Anthropic.

Microsoft Azure maintained its place as the world’s second-largest cloud provider during the quarter, with a 22% market share and 40% year-on-year revenue growth.

Meanwhile, recorded 36% year-on-year growth and increased its market share to 11%, mostly thanks to enterprise AI offerings.

Backlog levels among leading cloud providers continued to rise, with all three reporting further increases during the third quarter.

AWS, for example, reported a total backlog of $200 billion by the end of the quarter, while Google Cloud saw levels increase to $157.7 billion, up sharply from $108.2 billion in Q2.

Hyperscalers target platform gains

Omdia noted that ss enterprises look beyond AI platforms' model capabilities towards multi-model strategies and agent-based applications, hyperscalers are moving towards platform-level AI capabilities.

AWS, Microsoft Azure, and Google Cloud are all integrating proprietary foundation models alongside an expanding array of third-party and open-weight models.

This approach by the trio is centered around leveraging managed platforms and services such as Amazon Bedrock, Azure AI Foundry, and Vertex AI’s Model Garden to expand support.

“Collaboration across the ecosystem remains critical,” said Rachel Brindley, senior director at Omdia.

“Multi-model support is increasingly viewed as a production requirement rather than a feature, as enterprises seek resilience, cost control, and deployment flexibility across generative AI workloads.”

Real-world impact still a struggle

Notably, many organizations are struggling with real-world deployment, and hyperscalers are stepping up investment in agent build-and-run capabilities, Omdia revealed.

Recent examples of this trend include AWS AgentCore and Microsoft’s Agent Framework, which provide standardized foundational capabilities aimed at helping enterprises more efficiently build, deploy, and operate AI agents in production settings.

“Many enterprises still lack standardized building blocks that can support business continuity, customer experience, and compliance at the same time, which is slowing the real-world deployment of AI agents,” said Yi Zhang, senior analyst at Omdia.

“This is where hyperscalers are increasingly stepping in, using platform-led approaches to make it easier for enterprises to build and run agents in production environments.”

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Google Cloud has announced the first details of its new Partner Network, which is set to formally roll out in the first quarter of 2026.

The cloud giant is positioning the revamped channel initiative as a shift away from tracking program work to recognizing partner contributions across the full customer lifecycle.

Available to all partner types and sizes, the framework introduces a Diamond tier for the highest-performing partners, new competencies, as well as improved automation across the program.

The program will roll out in Q1 2026 and will include a six-month transition window to help partners adjust to the new structure.

In a blog post, Google Cloud said the initiative’s three core pillars – simplicity, outcomes, and automation – will better reward successful co-sale efforts, high-quality service delivery, as well as shared innovation with ISVs.

“Google Cloud Partner Network is being completely streamlined to focus on real-world results,” commented Colleen Kapase, Google Cloud’s VP of channels and partner programs.

“This marks a strategic shift from measuring program work to valuing genuine customer outcomes”

Google Cloud's streamlined framework

According to the tech giant, the new Partner Network has been designed to recognize partners for contributions such as pre-sales influence, co-innovation, and pre-sales support.

There’s also greater recognition for investments in skills, real-world experience, and successful customer outcomes.

On the structure front, the initiative is moving from a two-tier to a three-tier model with the introduction of a new Diamond category to the existing levels of Select and Premier.

This will be reserved for the highest-performing partners that consistently deliver "exceptional customer outcomes” across Google Cloud and Google Workspace, the hyperscaler said.

New competencies on the way

Partners will also see current specializations replaced with a new competency framework as Google Cloud reimagines how it rewards technical and sales capabilities.

New competencies will assess partners on two factors: capacity – measured through certifications and sales credentials – and capability – which will be tracked through validated pre-sales and post-sales contributions.

These competencies will be earned independently of tier status, with an additional Advanced Competency level signaling higher designation.

Increased automation

Across the entire program, Google Cloud is also doubling down on its automation focus.

Building on the introduction of its Earnings Hub and Statement of Work Analyzer tools, the Partner Network Hub will now use AI-driven automation to track partner progress automatically.

Successful customer engagements will be applied across all eligible tiers and competencies to help drive down time-consuming administrative and reporting tasks.

“This radical simplification eliminates redundant reporting and ensures seamless, comprehensive recognition for the outcomes delivered,” Kapase said.

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Palo Alto Networks is set to shift key security workloads to Google Cloud as part of a multi-billion deal that expands the companies' existing partnership.

The security firm and cloud giant said the deal aimed to make it easier for companies to keep systems and data secure as AI is rolled out – a key concern among many in the industry thanks to a rise in AI-related security incidents.

"Every board is asking how to harness AI's power without exposing the business to new threats," said BJ Jenkins, President of Palo Alto Networks. "This partnership answers that question."

"We're removing the friction between security and development, providing a unified platform where the most advanced security is simply a native part of building what's next,” Jenkins added.

“Together with Google, we are embedding our AI-powered security deep into the Google Cloud fabric, turning the platform itself into a proactive defense system."

Moving to Google

The deal will protect live AI workloads on Google Cloud – making it easier for existing customers of both to maintain security policies and help boost Google Cloud adoption, the companies noted.

Part of this will see Palo Alto Networks migrate key internal workloads to Google Cloud, with Palo Alto shifting to Google Cloud's Vertex AI platform and Gemini large language models (LLMs) to power its AI agents.

Part of the deal will involve creating new security services powered by AI, Jenkins told Reuters.

Matt Renner, president and chief revenue officer at Google Cloud, said that the partnership would make life easier for companies that were already working with both providers on application and data security.

"This latest expansion of our partnership will ensure that our joint customers have access to the right solutions to secure their most critical AI infrastructure and develop new AI agents with security built in from the start," Renner said in a statement.

Neither company has publicly confirmed financial details of the deal, but a source told Reuters that Palo Alto would spend an amount "approaching $10 billion" over the next several years.

The companies have long had a tight partnership, with Palo Alto CEO Nikesh Arora formerly working at Google.

Securing AI infrastructure

Palo Alto Networks said its recent State of Cloud report revealed that 99% of respondents had identified at least one attack against their AI infrastructure of the previous year.

The new deal with Google Cloud is an attempt to address that challenge by adding security into multi-cloud infrastructure.

That includes end-to-end security for AI workloads and data on Google Cloud using Palo Alto Networks Prisma AIRS platform. This offers enterprises AI-driven firewalls to secure all types of cloud setups and a secure access service edge (SASE) platform to protect network access for remote workers, mobile devices, and branch offices.

"The deep alignment between the two companies ensures that customer solutions are pre-vetted and engineered to work together, removing the integration challenges and operational friction that can slow down security teams," the companies said in a statement.

"This allows customers to deploy protection faster, simplify compliance and gain a single, comprehensive view of security across their entire hybrid multi-cloud environment."

This is the cloud giant's latest security play. Earlier this year, Google announced plans to acquire Wiz security for $32 billion.

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Cohesity has announced an expansion of its strategic partnership with Google Cloud in a bid to strengthen cyber resilience and drive enterprise AI adoption through new product integrations.

Building on the pair’s existing long-term collaboration, the agreement includes new solutions geared towards helping organizations better protect their data, meet regulatory requirements, and unlock greater value through enterprise AI deployments.

Additions include integrations between Google Cloud’s AI and security offerings and Cohesity’s enterprise AI assistant, Gaia, its Data Cloud platform, as well as Cohesity DataProtect.

“This collaboration with Google Cloud represents a bold step forward in redefining how enterprises protect, secure, and gain insight from their data, while reframing sovereignty from a regulatory burden into a source of trust and advantage,” said Cohesity’s CEO and president, Sanjay Poonen, in an announcement.

AI-driven insights

At the heart of the agreement lies Cohesity’s enterprise AI assistant, Gaia. Building on existing integrations with Google Gemini models, the vendor plans to embed Google Cloud’s Vertex AI Search capabilities into Gaia to enable instant, grounded answers to structured user queries.

The tech giant said this will offer citations pulled from source files stored within Cohesity’s immutable data lake.

There’s also a new integration with Gemini Enterprise in the pipeline, which will allow AI agents built on Google’s platform to securely access historical enterprise data stored within Cohesity’s Data Cloud.

The firm said the integration will enable “seamless connection” with existing workflows.

Additionally, customers can now leverage a Google Cloud-hosted version of the Gaia platform, designed to offer improved performance and response through Google’s global infrastructure.

Security enhancements

On the security front, the Cohesity Data Cloud already incorporates Google Threat Intelligence to help customers detect and respond to threats to their data stores, with Google’s indicators of compromise (IOCs) allowing for both proactive hunting and reactive threat scanning within the Cohesity platform.

The collaboration also pairs Cohesity’s Cyber Event Response Team (CERT) with Google Cloud’s Mandiant Incident Response team to support joint customers in their recovery from potentially destructive cyber attacks.

The pair said they will offer deeper integration between the Cohesity Data Cloud and Google Security Operations to automate security operations workflows and detect threats hidden within backup environments.

A planned cyber resilience SaaS solution will offer cloud-isolated recovery to help reduce recovery times.

Digital sovereignty

The expanded partnership also focuses on data sovereignty as compliance requirements continue to increase in complexity.

Cohesity is certified as a Google Cloud Ready – Regulated & Sovereignty Solutions partner, meaning customers can deploy the firm’s Data Cloud offering within the Google Cloud Data Boundary to comply with data residency and sovereign control requirements.

Cohesity FortKnox on Google Cloud also promises immutable, geographically-restricted cyber vaulting with policy-based controls geared towards meeting sovereignty requirements.

Additional highlights

Elsewhere, the partnership expands data protection capabilities for Google Cloud services such as Compute Engine and Cloud Storage, with additional support planned for GKE, BigQuery, and other data-centric services.

Cohesity and Google Cloud will also collaborate on joint go-to-market programs, co-selling initiatives, as well as integrated marketing campaigns. All components of the Cohesity Data Cloud are available via the Google Cloud Marketplace.

Google Cloud CEO, Thomas Kurian, said the agreement underlines the companies’ shared commitment to helping organizations “unlock the full potential of their data.”

“By combining Google Cloud’s AI and security innovations with Cohesity’s cyber resilience foundations, we’re enabling enterprises to accelerate AI transformation while building a more resilient, compliant future for customers everywhere in the world,” he commented.

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Cloud security teams are scrambling to keep pace with expanding attack surfaces, new research shows, largely due to the rapid adoption of enterprise AI solutions.

In a survey of more than 2,800 security executives and practitioners by Palo Alto Networks, 99% said they had experienced an attack against AI applications and services in the past year.

Meanwhile, the firm warned generative AI-assisted vibe coding is in use by 99% of respondents - but is generating insecure code faster than security teams can review it.

Of the 52% of teams that ship code weekly, only 18% say they can keep up with fixing the vulnerabilities the technology creates.

“As organizations aggressively scale cloud investments to power AI initiatives, they are inadvertently opening the door to sophisticated new attack vectors," said Elad Koren, vice president of product management at the firm's Cortex security platform.

Notably, Palo Alto warned attacks are getting faster, with breaches that took an average of 44 days in 2021 now taking as little as 25 minutes.

"The speed, scale, and sophistication we’ve observed over the past couple of years is incredible," said Haider Pasha, vice president and chief security officer, EMEA, at Palo Alto Networks.

Attackers are increasingly exploiting the foundational layers of the cloud, targeting API infrastructure, identity, and lateral network movement. API attacks, for example, are up by 41%, making them a primary entry point for sophisticated threats.

The top challenges for cloud security teams

Meanwhile, 53% of respondents cited lenient identity and access management (IAM) practices as a top challenge, saying that insufficient access controls are now a leading vector for credential theft and data exfiltration.

These findings align closely with a recent study from Okta, which also highlighted growing concerns about identity security.

An August survey from the firm found 85% of security leaders now view IAM as a critical security focus, marking an increase on the year prior.

Elsewhere, long-running issues with tool sprawl are adding insult to injury for cloud and security practitioners. Disparate tools are creating dangerous blind spots, the company noted, with respondents now managing an average of 17 cloud tools from an array of vendors.

The resulting fragmented data and context gaps are prompting 97% of respondents to prioritize consolidating their cloud security footprint.

SOC teams are struggling

Security operations center (SOC) staff are also struggling amidst a surge in cloud-related attacks, Palo Alto found. A key factor here lies in disjointed workflows and isolated data sources between cloud and SOC teams, the study noted.

This lack of alignment is stalling remediation efforts, with nearly one-third (30%) of respondents revealing they take more than a full day to resolve an incident.

To cope, researchers said cloud and SOC teams must merge, with 89% of organizations believing cloud and application security must be fully integrated with the SOC to be effective.

"Our research confirms that traditional approaches to cloud security are inadequate, leaving security teams to fight machine-speed threats with fragmented tools and slow, manual fix cycles," said Koren.

"Teams need more than just dashboards highlighting risks they can never burn down; they must transform with an agentic-first platform that spans code to cloud to SOC to finally operate faster than the adversary.”

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Enterprises running Nutanix will soon be able to build and operate their own sovereign cloud services following the release of several new features.

New features on the Nutanix Cloud Platform (NCP) will give customers “more choice in how they run and govern infrastructure”, the company said.

The move comes amidst a sharpened enterprise focus on data sovereignty and demand for greater cloud vendor flexibility.

Data sovereignty and vendor flexibility are two overlapping considerations that enterprises are grappling with at present, according to Nutanix. IT leaders face disconnected environments and disparate application estates, often running on sovereign services spanning multiple providers.

“As sovereign cloud architectures become a defining priority for enterprises, we’re introducing several enhancements to the Nutanix Cloud Platform that help customers meet these needs without giving up the advantages of a distributed cloud infrastructure,” said Thomas Cornely, executive VP of product management at Nutanix.

With this in mind, Nutanix wants to cut out the middle man by allowing customers to build their own, reducing complexity and reliance on major providers.

“These new capabilities give customers the clarity and control needed to draw their own sovereign boundaries across distributed environments and leverage the resiliency and flexibility that distributed clouds provide,” Cornely commented.

What to expect from the new Nutanix features

As part of the update, NCP will now offer users “orchestrated lifecycle management” covering “dark-site environments”, meaning they’ll gain greater visibility over distributed cloud environments.

New on-premises deployment options for the Nutanix Central solution, which aims to simplify cloud management, are also rolling out.

Elsewhere, Nutanix Data Lens will also run in on-prem environments. The Data Lens platform aims to bolster unstructured data security, governance, and resilience.

The company said these new options aim to further shore up governance and resilience capabilities.

Nutanix touts new automation tools

A new automation tool, Nutanix Infrastructure Manager, will also be rolling out in the wake of the update. This new service also targets greater environment visibility, the company said, streamlining deployments for users.

Nutanix Infrastructure Manager will give enterprises a single view of virtual local area networks (VLANs), for example, allowing for “centralized visibility and controls" across both on-prem and public cloud environments.

Nutanix said management of Kubernetes and AI environments will also gain a boost through the management tool.

Recovery options in the spotlight

Backup and resilience capabilities are a key focus in the update, according to Nutanix, with new features allowing customers to bolster application security and availability across multiple sites and regions during outages.

These capabilities, the company noted, are “essential for sovereignty-aligned environments” and look to address single-vendor dependencies.

“Teams can now apply sophisticated tiered disaster recovery options that match protection levels to each workload, for additional fault tolerance and cyber recovery resilience,” Nutanix explained.

“New capabilities help ensure business continuity even in the event of up to three site or region failures. Integration of multi-cloud snapshots into the tiered approach ensures an added layer of protection for cyber-resilience objectives.”

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• Let’s talk about digital sovereignty
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• CIOs wrestle with Europe's new digital sovereignty approach

Global IT spending has grown at the fastest rate in nearly 30 years, according to IDC, largely thanks to the boom in AI and cloud services and PC refresh cycles.

Figures from IDC's latest Worldwide Black Book show that spending on hardware, software, and IT services is on course to rise by 14%. That's the fastest year of growth since 1996, when the launch of Windows 95, expanding PC usage, and internet adoption were the primary drivers of IT spending.

Now it's all about the massive AI infrastructure investment wave driving another ‘supercycle’ of tech spending, IDC noted, with the figure set to reach $4.25 trillion.

Total ICT spending, which includes telecom and business services, as well as IT spending, will reach almost $7 trillion this year, the consultancy found.

The report marks seven consecutive months in which spending has risen - reflecting continued over-performance and aggressive investments by service providers in AI infrastructure.

This month’s figures were also boosted by strong enterprise software spending, with many organizations continuing with digital transformation and cloud migration projects.

IDC said it now expects software spending to increase by 14% in the year ahead, with AI deployments adding to investments in security, optimization and analytics.

“AI is the headline of IT market performance in 2025, but most of the actual AI investment this year is concentrated in service provider infrastructure,” said Stephen Minton, group vice president at IDC.

“This AI investment is partly supported by enterprise spending on core IT products and services, which make up the strong revenue streams of the service providers investing heavily in AI deployment."

With this AI investment supporting economic growth and stability, businesses can more easily maintain their investments in cloud services and enterprise software, Minton added.

"As a result, we’re currently experiencing a virtuous cycle of tech-driven macroeconomic growth,” he said.

IT spending boom shows no signs of slowing

According to IDC, IT spending increased by 16% in the first quarter of this year, partly due to front-loading of PC shipments ahead of anticipated tariffs in the second quarter.

Spending across Q1 marked the fastest quarterly IT market growth in 29 years, the consultancy noted.

Elsewhere, enterprise IT spending increased by 11% in Q1 and 10% in Q2. But it's service provider spending on data center infrastructure – spanning servers, storage, and network equipment – that's set to skyrocket.

Indeed, IDC projects an overall increase of 86% in 2025, reaching almost half a trillion dollars.

There's no sign of any slowdown, either. With most businesses planning to increase IT budgets again in 2026, IDC reckons the figure will rise by 10% in 2026, slower than 2025 but still representing one of the strongest years for the industry since the 1990s.

“There are headwinds and downside risks in the 2026 outlook, including an expected memory component shortage which may drive up PC prices next year,” said Minton.

"Technology demand has been resilient this year in the face of uncertainty around tariffs and a sluggish global economy, but our baseline forecast calls for a stable economy, supported in part by ongoing AI investment," he added.

"Even in a moderate recession, most IT spending would continue. The likelihood of a ‘perfect storm’ similar to the IT market crash of 2001 remains low.”

MORE FROM ITPRO

• Global AI spending is set to hit $2 trillion next year
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Agents, agents, and more agents. It’s the big trend that’s taken the tech industry by storm over the last year, and truth be told, I’m at the point where I’ve covered the topic so much that I’m dealing with a severe case of semantic satiation.

AWS announced a new class of agents at its annual re:Invent conference last week. Known as “frontier agents”, these are more powerful, intuitive, and better equipped to deal with extended periods of operation than the first generation of agents.

From start to finish, the event reeked of hype and hyperbole, with CEO Matt Garman placing agentic AI as on par with the web and cloud computing in terms of its potential long-term impact on businesses.

I’ve no doubt that agentic AI will mark a step change in the evolution of the technology, but I was at least expecting AWS’ old guard reputation in the industry to temper expectations. On that front, I was way off the mark.

As with generative AI, the agentic trend is nowhere near the point of delivering on the bold promises made by major industry providers. An MIT study in August, for example, found enterprises have invested upwards of $35 billion in generative AI projects.

Yet despite these huge investments, they still haven’t reached the productivity-related promised land predicted by big tech.

On the agentic AI front, the situation is roughly the same, with a similar pessimistic outlook on success rates. Analysis from Gartner found that over 40% of projects will be cancelled by 2027, underlining the high stakes involved.

A key factor here, the consultancy noted, lies in “escalating costs, unclear business value, or inadequate risk controls”.

That gives AWS and its industry counterparts roughly two years to drive home the messaging before enterprise IT leaders start wondering where all the money has gone – and that’s if we’re being generous and assuming patience will last.

AWS' old tricks could work with new trends

To AWS’ credit, it has the experience and know-how to potentially deliver on this promise. Indeed, the company is pursuing a similar strategy to the early days of the cloud shift.

Start with the hardware and infrastructure and build from there. In this regard, there’s no denying the company has the capability to deliver: it has strong, deep roots and still holds the title of the largest of the three hyperscalers.

The hyperscaler covered all bases in this regard across the four-day event: from new Trainium chips to Amazon S3 upgrades and an array of AI-related announcements aimed at lowering the barrier to entry for enterprises.

Chief among these was the launch of Amazon Nova, a new system that allows customers to build frontier models. The platform enables customers to combine in-house data with AWS’ open training models, with the result being a bespoke model curated specifically for an enterprise’s individual needs.

This will undoubtedly bridge what has typically been a gap for many enterprises since the advent of generative AI: the lack of financial muscle required to build their own models.

Notably, these custom models will be hosted through Bedrock, the firm’s one-stop shop for in-house and third-party AI tools and a key focus for the company over the last two years.

There is an argument to be made that AWS is building a walled garden here. It obviously wants to keep customers operating within its ecosystem, and platforms like Bedrock and the AgentCore service – a similar setup for sourcing and deploying agents – will help it achieve that.

However, this is less of a walled garden approach akin to the cloud era and more clearly aimed at cultivating an ecosystem that covers all the bases for customers. The company has made no secret of its willingness to simplify integration with other hyperscalers and its relationship with AI providers like Anthropic further highlights this.

Getting projects off the ground

Shiny new tools might get customers excited, but whether enterprises can actually capitalize on these is another question. That's where partners will come in handy for the hyperscaler.

The AWS partner ecosystem is going to play a key role in driving adoption rates, particularly on the agents front. This thriving ecosystem of systems integrators and independent software vendors (ISVs) was critical during the halcyon days of cloud adoption.

As ITPro learned at re:Invent 2025, Rohan Karmarkar, managing director of AWS’ partnership solutions architecture, said partners have been “critical from day one” – the same rules apply with agentic AI.

With 140,000 partners to draw from, AWS customers have no shortage of expertise and support if they’re dabbling in agents. From the hyperscaler’s perspective, this presents a huge opportunity to simplify adoption processes, which are going to be a challenge if it's going to hit the ground running with this strategy.

Tangible business use-cases

One recurring gripe enterprises and industry stakeholders alike have had with generative AI has been the pie-in-the-sky claims from providers.

We’ve all heard the talking points about productivity improvements and efficiency gains, but the reality is that there simply hasn’t been enough concrete evidence to support the idea that the technology will be the game changer it’s framed as.

Agentic AI has - and will continue to - suffer the same problem. In this sense, AWS made a big statement in highlighting its own internal use of agents - and so far the signs are promising.

As AWS CISO Amy Herzog told ITPro, the company has been using agents in security operations for some time now, enabling teams to drastically reduce manual toil and speed up incident response capabilities.

During the same panel session where Herzog touted the technology’s potential, Hart Rossman, VP, Office of the CISO, also detailed the company’s success with an internal “security response agent”.

AWS’ reputation as a reliable, no-nonsense hyperscaler precedes it. If the company draws on its cloud credentials to push agentic AI and continues showcasing tangible business use-cases, then it might finally stake its claim as the go-to AI shop after what was a rocky start in the early days of the generative AI race.

Welcome back to ITPro's live coverage of AWS re:Invent 2025. It's day-two here in Las Vegas, and we've got another action packed morning ahead of us.

Leading the opening keynote today is Swami Sivasubramanian, Vice President of Agentic AI at AWS. He'll be running us through all the developer-focused service and product announcements, and we're expecting another rapid fire session to buckle up.

CEO Matt Garman kicked things off yesterday with updates across all of AWS' key product lines, including Amazon S3 and Bedrock. Naturally, the key focus was new agentic AI capabilities for customers.

AWS customers will be able to get their hands on powerful new "frontier agents" aimed at streamlining software development practices, as well as the ability to build their own frontier AI models using Amazon Nova Forge.

IT modernization was also another key talking point, again with agentic AI capabilities for AWS Transform.

You can read more about all these announcements below.

• Now anyone can build their own frontier AI model

• AWS CEO Matt Garman says AI agents will have 'as much impact on your business as the internet or cloud'

• Amazon S3 just got a big performance boost

• AWS targets IT modernization gains with new agentic AI features in Transform

• 'Frontier agents' are here, and AWS thinks they're going to transform software development

While most of the big announcements from AWS are yet to be revealed this morning, we have had some big updates rolled out for the company's Transform service. First announced earlier this year, AWS has doubled down on the IT modernization platform with an array of new agentic AI capabilities.

As part of the move, enterprises will be given access to powerful new AI features aimed at supercharging legacy code modernization spanning a range of programming languages, with additional tools for mainframe modernization also announced.

You can read more about the latest update to AWS Transform in our coverage below.

• https://www.itpro.com/technology/artificial-intelligence/aws-targets-it-modernization-gains-with-new-agentic-ai-features-in-transform

It wouldn't be a tech conference without some music absolutely blasting out at 7.30am. The keynote theater is filling up now with a torrent of people making their way through the Venetian Hotel.

We're just a couple of minutes out from Matt Garman's keynote now and the excitement is building. A packed conference hall here.

Matt Garman has taken to the stage, hailing the company significant growth over the last year.

"Amazon Bedrock is now powering AI inference for more than 100,000 companies around the world," he says, giving a shout-out to the AgentCore service launched earlier this year. Huge growth within just a few months and thousands of companies flocking to the agentic AI service.

Infrastructure expansion continues at pace, Garman says. In the last year alone the company has added 3.8 gigawatts of data center capacity, more than any other company on earth.

Networking infrastructure is also expanding rapidly, he adds.

"None of what we do at AWS happens without builders, and specifically developers."

"AWS has always been passionate about developers," he adds. This is a key tenet of the company, and with developers fueling the company's sharp AI focus they've never been more important.

Developers face significant challenges, however. They're spending too much time dealing with bottlenecks. Freeing up time for developers is the key to building successful products, Garman notes.

Naturally, AI is helping solve this problem, and with the advent of AI agents the potential here is huge.

"This change is going to have as much impact on your business as much as the internet or the cloud," he says.

So what do businesses need to drive agentic AI adoption? This will be a multi-pronged approach, according to Garman. Starting from the foundational infrastructure level through to data storage and the tools and solutions needed to build and deploy agents.

Of course, AWS has been focusing heavily on all these fronts.

"You have to have a highly scalable and secure cloud that deliver the absolute best performance for your workloads."

And with that we have our first big announcement here at re:Invent, the launch of AWS AI Factories.

“With this launch, we’re enabling customers to deploy dedicated AI infrastructure for AWS in their own data centers for exclusive use for them," Garman says.

“We give them access to leading AWS infrastructure and servers, including the very latest Trainium and UltraServers.”

We’ve moved onto Trainium now, with Garman touting its potential for inference - a big talking point we expected to see here at re:Invent with the focus on Google’s TPUs growing and the company's recent deal with Anthropic.

“We’ve deployed over one million Trainium chips to date,” he says. And AWS isn’t stopping there. “We’re selling those as fast as we can make them.”

Anthropic is also using Trainium chips for AI training and inference through Project Ranier.

And we have another big product announcement today - Trainium3 UltraServers general availability.

"Trainium3 offer the industry's best price performance for large scale AI," Garman says. Big performance gains here.

4.4x more compute, 3.9 times more memory bandwidth. With UltraServers, customers have 144 Trainium3 chips at their disposal - that's 362 PFLOPS and 706 TB/s bandwidth.

AWS is well along on Trainium4 development, Garman reveals. This upcoming range will offer six-times performance, four-times memory bandwidth and 2x memory capacity compared to Trainium3. Huge performance gains that customers can expect to see next year.

Infrastructure is only one part of the story, Garman says as we move onto explore inference, another key focus for the company through its Bedrock service.

More than 100,000 customers are using Bedrock, according to Garman. But it’s the “volume of the usage that’s astounding”, he says.

“We now have more than 50 customers who’ve processed more than 1 trillion tokens through Bedrock. Incredible scale and momentum.”

So how does Bedrock work? It’s essentially a marketplace for in-house and third-party AI models, with customers able to pick and choose based on their own needs.

“We never believed there was going to be one model to rule them all,” Garman says, and Bedrock certainly shows that. It’s doubled the amount of models hosted on the service in the last year, underlining the varied demand from enterprise customers.

And with that we’ve got another big announcement for Bedrock with four new open weight models, including Nvidia's Nemotron and Google Gemma.

Mistral Large 3 and Ministral 3 are also coming to Bedrock Garman reveals.

AWS has its own in-house models, the Nova range, which is getting a big update with the Nova 2 series.

“Nova has grown to be used by tens of thousands of customers today,” he says.

This includes three separate models - Lite for cost-effective reasoning, Pro, the “most intelligent” model for complex workloads, and Sonic, a multi-modal option. Amazon Nova 2 Omni is also coming soon, Garman reveals. This is a multimodal option which excels in reasoning and image generation, perfect for marketers and creatives.

Nova 2 Pro is a key focus here, particularly given its use in underpinning agents, according to Garman. I get the feeling we’re building towards a big agentic AI announcement.

So, you’re an enterprise and want to build your own AI model - seems simple, right? It’s far from it.

Training from scratch is a time-consuming, expensive process and not a realistic expectation for most enterprises.

Building with open weight models help take the edge off, but you can only go so far Garman says.

“You just don’t have a great way to get a great frontier model,” he says. AWS wants to solve that.

Amazon Nova Forge is a new service that “introduces the concept of open training models”. Essentially, you can build your own frontier AI model by combining internal enterprise data with AWS open weight models picking up the slack.

“We’ve already been working with a few customers to test out Nova Forge,” Garman says. This includes Reddit, which has built its own frontier model using the service.

“We think this idea of open training models is going to completely transform what companies can invent with AI,” Garman adds.

We've officially moved onto agents, one of the "biggest opportunities that are going to change everyone's business," according to Garman. The company has already had moves toward ramping up customer agentic AI adoption.

The Bedrock AgentCore service, launched earlier this year, gives customers access to a range of custom built agents as well as the ability to build and deploy their own.

"AgentCore is truly unique in what it enables for building of agents," he says, adding that flexibility and choice is a key focus of the service.

"You only have to use the building blocks you need. We don't force you as builders to go down a single fixed path."

AgentCore is a source of immense excitement at AWS, it seems.

"The momentum is really accelerating," Garman says, with enterprise customers flocking to the platform at a rapid pace since its launch earlier this year.

Security is a recurring talking point with agentic AI, Garman says. Identity security-related considerations and guardrails are causing headaches for security teams as agents weave their way through data sources behind the scenes.

"You can't with certainty control what your agent does and does not go," he says. Giving enterprises tools to set clear boundaries for agents is critical.

With that in mind, the company announces Policy in AgentCore, which allows users to set strict rules for agents to help them "stay in bounds".

Garman is running us through an example here involving an agent operating in a customer service capacity. Users can set a limit on the size of refunds issued by an agent. Hoping to chance your luck and get a refund on something over $1,000? That won't work.

So now that you've secured your agents, how do you track performance? You've invested a lot of money in these shiny new tools, but are they actually delivering a return on investment or even helping customers?

Another new service unveiled today, AgentCore Evaluations, helps enterprises keep track of agent activities and performance based on real-world interactions with customers.

"Evaluations helps developers continuously inspect the quality of their agent based on real world behavior," Garman explains. "Evaluations can help you analyze agent behavior for specific criteria like correctness, helpfulness, harmfulness."

AWS has been quietly working away building its own range of agents in recent months, Garman says. Amazon Quick, for example, assists users in visualizing and analyzing data or automating workflows.

Employees across the company are using Amazon Quick and recording marked benefits so far.

"Today we already have hundreds of thousands of users inside the company," he says. "Teams are telling us they're completing tasks in one-tenth of the time it used to take."

Amazon is also using agents in customer service roles, with Amazon Connect already being used by a range of major customers such as Toyota, Capital One, or National Australia Bank.

"The Connect business passed the one billion annualized run rate mark," Garman says.

Moving onto developers now, Garman says agents have great potential here to help reduce workloads and speed up operations.

This is where platforms such as AWS Transform come in, helping modernize legacy and mainframe code. Thomson Reuters, for example, is modernizing more than 1.5 million lines of code a month during the process of moving from Windows to Linux.

Elsewhere, solutions like Kiro, AWS' AI coding tool, is helping drive developer productivity.

Kiro is one of a growing array of AI coding tools out there on the market in 2025, but Garman says the reception has been huge, with "hundreds of thousands of developers" using the platform globally since launch.

Kiro has been a huge success internally at Amazon so far. Last week, the company made the decision to make it the official development tool for teams across the company.

With agentic AI gains over the last year, there's huge potential for developers, Garman says, especially with "frontier agents".

These aren't your bog standard AI agents, they're more intuitive, autonomous, and powerful - for developers, the Kiro autonomous agent could be a game changer.

This AI agent essentially acts like "another member of your team", according to Garman, learning from the processes and practices from the team to continually improve.

"We think this will help you move much more quickly," Garman says. The agent is going to help shipping more code, more quickly.

But there's more to software development than just writing code, there are key security considerations at play here. The new AWS Security Agent will help underpin safe, secure software development.

"This agent will help you build applications that are secure from the very beginning," Garman says. "It embeds security expertise upstream and enables you to secure your systems more often."

Security Agent also helps with penetration testing, giving developers teams what was traditionally a laborious process one that's now on-demand. Huge improvements to broader software security here, but also speeding up the development lifecycle.

Want to learn more about the new frontier agents from AWS? Check out our coverage and interview on the announcement below.

• AWS says ‘frontier agents’ are here – and they’re going to transform software development

With faster programming and improved security processes, there's only one part of the equation missing. Deployment of software. With this in mind, the new AWS DevOps Agent helps investigate incidents and proactively work to improve application deployments.

We've still got a bunch of launches expected here. Garman says he's going to rally through the next few announcements - 25 in 10 minutes.

"Buckle up everybody," he says. We're going to cut to the chase here and distill things into simple bullet points covering key areas, starting with Amazon S3.

• S3 object size limits are getting a big boost, a 10x boost to 50TB

• That's not all though, Amazon S3 Batch Operations are also now 10x faster

• Elsewhere, Amazon S3 Tables are also getting new intelligent tiering to help with cost optimization

• General availability of S3 Vectors

Elsewhere, we have some big database announcements.

• Increased storage capacities for RDS for SQL Server and RDS for Oracle are coming

• Optimized CPUs for RDS for SQL Server

• A big new database savings plan for customers - savings of up to 35%, according to Garman

And with that, the keynote session is over. We'll be back shortly with a roundup of everything we learned in the opening session. Thanks for following and remembered to keep tabs on our socials and newsletter for all content from AWS re:Invent across the week.

A steady stream of people entering the keynote theater now with just over 30 minutes until Swami kicks things off on day two.

Swami Sivasubramanian has taken to the stage now, asking the audience to think back to the first programme they built. Feeling rather left out at this point...

Good news though, Swami says "who can build is changing" as a result of generative AI and agentic AI. New AI-powered tools are lowering the bar for non-technical individuals.

So how is an agent different from a generative AI chatbot? Swami says imagine that traffic to a website goes down rapidly in a matter of days.

Using a chatbot, the response would be rather basic, but with an agent you'd get a response with deeper context and a concrete plan to solve the problem.

"The chatbot tells you what to investigate, the agent investigates, diagnoses the problem, and initiates the solution," Swami says.

Agents are the next big thing in the tech industry, and as we've seen already this week, AWS appears all-in. But building agents is a tricky process fraught with challenges and potentially disastrous pitfalls.

AWS wants to make that easier for customers, simplifying the process and enabling developers to build their own agents.

Strands SDK, for example, is helping supercharge developer building capabilities. The service was made generally available in July this year, and has seen great uptake already.

Now AWS is doubling down, offering support for TypeScript, one of the world's most popular programming languages. Elsewhere, Strands SDK will offer support for running agents at the edge - big potential in robotics here, Swami says.

Complexity is the biggest issue in building agents, Swami says. It's a long, difficult process in many cases. Ultimately, this slows down innovation.

Bedrock AgentCore seeks to address this, he adds. The service allows customers to build custom agents. The service has proved highly popular since its launch earlier this year and already boasts thousands of customers, Swami says.

"People love it because it works with any agentic framework and any model, giving you the freedom to use the tools that work best on your use case," he tells attendees.

"It's modular, so that you can mix and match using just the pieces you need for your solution," Swami adds. "AgentCore does the heavy work so you can focus on what matters most, creating these breakthrough experiences that solve real-world business problems."

And with that, we have two new capabilities for AgentCore. The first of these includes AgentCore Policy, which helps enterprises set more robust controls for agent interactions and behaviour.

Elsewhere, AgentCore Evaluations will help users keep tabs on how agents are performing, allowing them to fine-tune and tweak based on end-user feedback.

Another quick-fire announcement here with the launch of episodic memory capabilities for agents through AgentCore.

This, Swami says, will essentially give agents longer-term memory capabilities, helping them to remember and learn from past experiences.

Swami gives the example of air travel here as an area this capability could help. Travelling solo? get an agent to book a flight with a fairly quick turnaround at the airport. But travelling with family six months later, that same booking is going to be a disaster. Further down the line, using episodic memory, the agent would realize this and compensate.

Call me cynical, but this is just common sense. Why do you need an agent to remember a previous airport-related farce?

A tangible example of this being used in a business context would be great.

So far we've discussed how AWS is helping customers to build agents. Now we're moving on to look at making them more efficient.

Most agents are focused on basic functions right now, working away in the background, analyzing search results, writing code, or solving basic problems.

Scaling the capability of agents is the next step, giving them the ability to tackle more complex problems.

"Think of it as teaching your AI agent to be a specialist instead of a generalist. Like turning a family doctor into a cardiologist who is laser-focused on exactly what you need," he says.

Starting with pre-trained models makes sense here, and Swami says this is how most teams begin scaling agent capabilities. These are trained on curated agent-specific datasets.

"This creates permanent behaviour changes," he explains. "They don't require lengthy prompts, can dramatically improve performance on specific tasks."

But there's an issue here. Sometimes models can become too focused on specific tasks due to over training.

So what's the solution? Quality over quantity, essentially. Reinforcement learning, Swami says, helps build stronger, more intuitive agents.

"When an agent is troubleshooting a complex issue, you don't just want a final answer. You want the logical diagnostic steps," he says.

This is easier said than done, though. This is a costly process running between six-to-twelve months and requires deep in-house technical capabilities.

AWS has the solution here, who would've thought? Reinforcement fine-tuning is now available in Bedrock, Swami reveals. This will help markedly improve model accuracy and customization of AI agents.

All told, Swami says this delivers 66% accuracy gains. "That is how powerful these techniques are," he says.

Drilling down into deeper levels of customization, Amazon SageMaker AI is a big focus for AWS and customers. A new model customization feature, launching in preview, allows customers to tweak and fine-tune in-house or third-party models.

"With this release, you can customize popular models such as Amazon Nova, Llama, DeepSeek, and deploy them in a just a few steps," he explains.

"This comes with two experiences, and you can choose the right approach based on your comfort level - a self-guided approach for those who like to be in the driver's seat, and an agent-driven experience that uses an AI expert for folks who like to turn on autopilot in their cars."

Tweaking and fine-tuning AI models using AI agents. We're heading down the rabbit hole here.

We're joined now by Byron Cook, VP, distinguished scientist for automated reasoning at AWS, to discuss "neurosymbolic AI" and how the hyperscaler is working to make AI agents more trustworthy.

LLMs, as we know, can be tricked by bad actors, and that has downstream implications for agents. As a result, we introduce guardrails and essentially keep agents on a short leash.

But that limits their ability to deliver positive gains for users.

AWS uses automated reasoning to verify the outputs of the underlying LLM, which often provide instructions for the agents.

Automated reasoning is being used across a range of areas at the company, including storage and virtualization. Essentially critical areas where "failure is unacceptable".

We heard all about the new frontier agents AWS unveiled during yesterday's opening keynote - powerful new tools for developers spanning code generation, DevOps, and cybersecurity.

These will essentially act as teammates in the future, Sivasubramanian says. It's clear the company is pinning its hopes on a big push into the AI coding space with these new offerings.

They've got stiff competition though. Anthropic, OpenAI, Microsoft, GitHub, Google, and the various 'vibe coding' startups taking the industry by storm mean AWS will have stiff competition.

And that's a wrap on the day-two keynote. We've drilled down into a lot of the developer-focused product launches today, and we'll be sure to hear more as the week continues - tomorrow's keynote session is focusing specifically on infrastructure, a huge talking point in the age of AI.

We'll be back shortly with a comprehensive roundup of all the big talking points from both keynote sessions so far this week, so stay tuned!

Given we’ll imminently mark the third anniversary of the launch of ChatGPT, a moment which sent the global tech industry into a state of flux, hype, and hyperbole, it’s appropriate that one of the old guard hyperscalers prepares for its annual conference.

AWS re:Invent, hosted at the Venetian Hotel in Las Vegas, officially kicks off next week, offering Amazon’s cloud computing wing an opportunity to get the last word in before the turn of the year.

The oldest and largest of the three major hyperscalers, AWS was caught off guard with the launch of OpenAI’s flagship model alongside Google in late 2022. Both companies spent most of 2023 scrambling to catch up while Microsoft reaped the early rewards of its close-knit relationship with the AI company.

But the gap has been closing. As we learned at Google Cloud Next in April, Google has gained ground over the last 18 months and the recent launch of Gemini 3 stole Microsoft’s thunder while it bombarded customers with agentic AI announcements at its recent Ignite conference.

With its competitors making bold moves in recent months, this begs the question of exactly how AWS plans to wow customers, both current and prospective. AWS’ long-standing reputation as the mature hyperscaler with deep pockets and a focus on easy integration could be the key differentiator moving forward.

Indeed, the company made great strides on this front in mid-2023 with the launch of its Bedrock service, offering customers access to an array of third-party and in-house models.

As ITPro noted at the time, this showcased AWS’ ability to cut to the chase and give enterprise customers a clear route to generative AI adoption – with the flexibility of choice – while others focused heavily on pushing a rather monolithic approach to the technology.

With the agentic AI frenzy taking hold throughout 2025, the company has further built on this initial foundation, expanding Bedrock in July this year with the launch of Amazon Bedrock AgentCore and the AI Agents and Tools service in AWS Marketplace.

The former allows customers to build and deploy agents, while the latter offers them the chance to pick and choose from an array of options delivered through AWS partners.

That flexibility of choice has been a hit with AWS customers so far, and we can expect to see more on this at re:Invent 2025.

A hardware battle is brewing

On the hardware front, it’s clear there’s a battle brewing in the AI chip domain, with industry stakeholders touting Google’s growing hardware strength centered on its tensor processing units (TPUs) as a potential challenge to Nvidia’s AI dominance.

For AWS, we can also expect to see a big push at the company’s annual conference. AWS has been ramping up development of its own in-house AI chips in recent years, spurred on by the acquisition of Annapurna Labs in 2015.

This focus on hardware initially saw the company unveil its Inferentia chip in 2018, followed by the launch of Trainium in 2022. Both of these have been used to underpin training and development of foundation models through the company’s partnership with Anthropic, for example.

With the enterprise focus now shifting from training to inference, AWS will be keen to tout the potential here for customers. The Trainium2 chip was unveiled by the hyperscaler at re:Invent 2023, boasting 4x faster training and 2x energy efficiency capabilities.

Last year’s conference, meanwhile, saw the company tease plans for Trainium3, again with 4x performance improvements and 40% gains on energy efficiency.

During Amazon’s third quarter earnings results this year, CEO Andy Jassy confirmed the launch of Project Rainier, a cluster of around half a million Trainium2 processors being used to train Anthropic models, with plans to increase capacity to around one million by the end of this year.

In an announcement in late October, AWS’ head architect for Trainium, Ron Diamant, described the project as “one of AWS’ most ambitious undertakings to date”. It’s safe to assume the company will be keen to provide an update here.

The Anthropic tug of war

While Microsoft has its poster child in OpenAI, AWS has been betting big on Anthropic. The hyperscaler invested $4 billion in the AI startup back in September 2023 and doubled down on its support for the company just a year later.

The latter of these pledges saw Anthropic choose AWS as its primary cloud provider and training partner.

AWS isn’t the only hyperscaler with eyes for Anthropic, however. Google pledged $2 billion in 2023, following up with an additional $1 billion in January this year.

The relationship here is complicated, and it’s clear Anthropic isn’t keen on settling for a one-stop-shop approach to infrastructure partnerships. October, for example, saw Google Cloud and Anthropic forge even closer ties, with the latter expanding its use of TPUs to drive compute capacity for training upcoming Claude models.

Anthropic said the deal, which will see it gain access to around one million TPUs, was secured specifically due to their “price-performance and efficiency” benefits.

AWS will be keen to react in the wake of this deal between the two, and while there’s nothing to suggest the trio can’t co-exist, with a Trainium3 announcement expected the hyperscaler will be betting big on its own cost and energy efficiency credentials to one-up Google.

With a chip war looming and enterprises continuing to push for a return on investment with AI, AWS will be relying on its sprawling industry ties and long-standing infrastructure credentials to show it can still combine scale and agility at re:Invent.

ITPro will be live on the ground at AWS re:Invent in Las Vegas from 1st to 5th December. Keep tabs on all our coverage via our live blog, social channels, and newsletter.

Amazon Web Services (AWS) is planning to invest up to $50 billion in purpose-built AI and high-performance computing (HPC) infrastructure for the US government.

The data center build, set to start next year, will see an extra 1.3 gigawatts of compute capacity added across AWS Top Secret, AWS Secret, and AWS GovCloud (US) regions across all classification levels: Unclassified, Secret and Top Secret.

Federal agencies will gain expanded access to AWS's AI services, including Amazon SageMaker AI for model training and customization, Amazon Bedrock for model and agent deployment, Amazon Nova, Anthropic Claude, and leading open weight foundation models, with the use of AWS Trainium AI chips as well as Nvidia AI infrastructure.

"Our investment in purpose-built government AI and cloud infrastructure will fundamentally transform how federal agencies leverage supercomputing,” said AWS CEO Matt Garman.

“We're giving agencies expanded access to advanced AI capabilities that will enable them to accelerate critical missions from cybersecurity to drug discovery. This investment removes the technology barriers that have held government back and further positions America to lead in the AI era."

The investment, the company said, will speed up discovery and decision-making across applications ranging from national security to scientific research and innovation, including autonomous systems development, cybersecurity, energy innovation, and healthcare research.

AWS said the move is aimed at supporting the priorities laid out in the US government's recently-published AI Action Plan, which promotes the development of AI infrastructure, as well as other advanced computing initiatives deployed on secure, US-based AI and cloud infrastructure.

AWS boasts deep government ties

The hyperscaler is already a major cloud provider to the US government, serving more than 11,000 government agencies including US intelligence communities, the Department of Defense, federal agencies and defense industrial companies.

In 2011, it became the first cloud provider to build infrastructure specifically for government security and compliance requirements with the launch of AWS GovCloud (US-West).

Since then, it's launched AWS Top Secret-East, the first air-gapped commercial cloud accredited to support classified workloads; AWS Secret Region, making it the first cloud provider accredited across all US government data classifications; and AWS GovCloud (US-East), AWS Top Secret-West, and AWS Secret-West regions.

"Federal customers and the supporting industrial base share a vision of AI and HPC convergence. This includes orchestrating expert AI models, agents, and natural language interfaces to enable researchers and engineers to explore complex problems through conversational interaction," said Amazon.

"This represents a fundamental shift from traditional HPC workflows to AI-accelerated discovery, where scientists can specify challenges and receive AI-driven recommendations backed by high-fidelity simulations and analysis."

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More than half (52%) of government CIOs outside of the United States expect budgets to surge in the year ahead, driven in part by increased AI spending.

Analysis from Gartner, which carried out the research, shows governments and public sector organizations targeting rapid modernization and cost savings through emerging technologies. This is despite long-running budgetary constraints in this area.

Arthur Mickoleit, director analyst for government at Gartner, said a combination of “geopolitical shifts and economic volatility” means many government CIOs have been forced to “rapidly adjust their priorities for next year”.

“They are being asked to demonstrate the mission impact of technology investments – including, but not limited to, cost savings and user experience,” he said.

As well as AI, the survey highlighted increased investment in cybersecurity, as another leading priority for CIOs. With government entities facing increasing threats from state-sponsored hackers, 85% of respondents said this was an area for investment.

Elsewhere, investment in cloud transformation is another key objective for CIOs as government departments contend with growing workloads and infrastructure strain as a result of AI.

The survey noted 74% of government CIOs have already deployed or plan to deploy AI tools within the next 12 months. Interest in agentic AI is also skyrocketing, with 49% planning to deploy agents in frontline operations within the next year.

CIOs view this latest iteration of the technology as a potential “enabler of government transformation”, Mickoleit noted.

“This next wave of innovation will be essential for delivering on public sector priorities, especially as expectations are high following years of investments in digital government,” he said.

Agentic AI adoption raises concerns about both cloud and cybersecurity, though, underlining the sharpened investment focus on both these domains.

Don’t fall for the hype

A key takeaway from the Gartner survey centers around rising expectations with emerging technologies, particularly with generative and agentic AI tools.

Government CIOs are hopeful these technologies will unlock marked benefits for workers, with more than half (51%) expecting employee productivity gains in 2026.

The use of AI in building new digital products and services is another area of excitement, cited by 38%, while general improvements to the “overall citizen experience” are also expected, according to 38% of respondents.

While there’s great potential here, Mickoleit warned CIOs need to avoid falling into the hype cycle witnessed in private sector domains.

“CIOs must remain mindful of the hype that can distract from more mature technologies like machine learning and business process automation,” said Mickoleit.

The hype surrounding agentic AI has reached boiling point over the last year. In June, research from Gartner noted that many “AI agent solutions” were essentially just repackaged robotic process automation (RPA) tools and chatbots.

Long-term prospects for agentic AI adoption programs were also questioned, with the consultancy revealing around 40% of all projects would be ditched within two years.

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Europe’s long-running struggle to define digital sovereignty – and to turn it into something practical – is reaching an inflection point.

That was the message at this year’s Gaia-X Summit in Porto, where executives and governments argued that the continent finally has the technical foundations for sovereign data sharing.

All it needs now is the political will, economic models, and global partnerships to make it work at scale.

Gaia-X is a Brussels-based industry association bringing together European enterprises, technology vendors, cloud providers, standards bodies, and public sector institutions.

Its purpose is to build a common, verifiable framework: the Gaia-X Trust Framework. This framework is designed to define how organizations can share, store, and govern data in interoperable, sovereign, and audit-ready ways.

The initiative now underpins dozens of projects in manufacturing, energy, aerospace, mobility, finance and healthcare.

Unlike early misconceptions, Gaia-X is not a cloud provider. It sets rules around identity, compliance automation, service labelling, policy enforcement, and interoperability that cloud and data ecosystem providers must adhere to if they want to be considered sovereign-ready.

From pilots to real deployments

Gaia-X CEO Ulrich Ahle opened the Summit by admitting that while conceptual momentum is strong, adoption remains thin on the ground.

Europe has “more than 150 implementation projects in Europe at the moment in preparation,” but “we still have just a handful of operational databases really implementing benefits for their end users,” he said.

To help change that, Gaia-X will release its first multi-provider catalogue: 600 services from 15 providers aligned to four security and sovereignty levels. Ahle also reiterated Gaia-X’s near-term growth target: 1,000 services by the end of the year, scaling to 3,000 afterwards.

The top tier of the catalogue – Gaia-X Label Level 3 – is designed for maximum sensitivity use cases such as aerospace, energy, and national infrastructure workloads. Critically, Level 3 services can only be delivered by providers that have their headquarters in Europe, ensuring they are not subject to extraterritorial laws like the US Cloud Act.

EDF’s nuclear station program illustrates the demand: its data space is “requesting the highest level of security… the Gaia-X label level three. And this highest level security is reality,” said Ahle.

It’s worth noting that the conversation around digital sovereignty in Europe has shifted dramatically in the last two years, driven by one factor: AI systems that ingest sensitive, large-scale operational data.

“Trustful AI needs trustful data. And here, data sovereignty is of utmost importance,” said Ahle.

Hyperscalers: foundational but insufficient

CIOs and CTOs know the hyperscalers aren’t going anywhere. Gaia-X leaders know it too. But the limits of “sovereign cloud” offerings from US players were addressed without ambiguity.

Even when operated inside Europe by European employees, those services “are still under the American legislation, under the Cloud Act,” said Ahle. That constraint may be acceptable for 90% of enterprise workloads, but not for the 10% that carry regulatory, national infrastructure, or safety-critical risks.

Chairwoman of the Gaia-X Board and EVP digital at Airbus, Catherine Jestin, put it more bluntly: “The fact you have not done it in the past doesn’t guarantee that you will do it in the future.”

This is why Airbus does use hyperscaler services – but not for its most sensitive workloads: “I really love to work with AWS, with Google and Microsoft… but not for the most critical applications and services.”

For IT teams, this is the emerging pattern: hyperscalers for scale, elasticity and tooling; sovereign frameworks for critical data integrity, compliance automation, and legal insulation.

When asked whether trust in US providers had worsened under President Donald Trump’s second term in office, Jestin noted, “It hasn’t helped.”

This aligns with the wider shift across Europe. For years, EU member states could not agree on whether stringent sovereignty rules were needed. But now, Jestin said, “we see with the latest publication from the European Commission that’s now… on the top of the agenda.”

CIOs designing long-term cloud strategies could see certifications, service labels, and jurisdictional guarantees increasingly required by regulators and embedded into RFPs.

Operating a data space is not free

One of the most useful insights for IT leaders came from Jestin, who highlighted the hidden operational costs of building and maintaining data spaces – the very reason many sovereign cloud initiatives fail internally.

Running a compliant data space requires organizations to “maintain and support the connectors… to maintain [and] support Identity and Access Management (IAM)… to maintain the contracts.”

Without sustainable economics, she warned, “you just go in a negative spiral, and your data space will not be successful in the future.”

To address this, Gaia-X is working with economists at Paris Dauphine University to model participant roles, orchestrator responsibilities, and cost-recovery mechanisms to ensure sovereignty is engineered as a business model, not just a compliance posture.

The bottom line for CIOs, CTOs, and architects

Gaia-X said it’s not trying to reinvent the cloud. Rather it’s trying to standardize trust, compliance, and verifiability in a market dominated by providers whose legal obligations don’t always align with European sovereignty requirements.

The Porto Summit’s message was that sovereignty is becoming programmable through labels, identity rules, compliance automation, and clearing houses.

Yes, hyperscalers remain essential, but they are no longer sufficient for high-risk workloads. AI governance is elevating data integrity and traceability to strategic priorities.

Economic models for data spaces must be planned upfront, not retrofitted. And geopolitics has entered the IT architecture stack in a way organizations can no longer ignore.

“Technology is ready. It is about adoption… and sustainable operation,” Ahle said.

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Dell Technologies argues that there's no longer a debate between public cloud or private – instead, the focus is on using all of the available options and finding ways to manage that complexity.

"The conversation around enterprise IT is changing," said Caitlin Gordon, Vice President of Multicloud Product Management for Dell Technologies in a blog post. "It’s no longer about choosing between public cloud and on-premises infrastructure."

"Nor is it a simple decision between running traditional or modern workloads. Today, the real challenge is how to manage all of these different environments and application types together, simply and consistently."

To help, Dell is expanding its existing partnership with Microsoft – which already offers AX System for Azure Local, later adding PowerFlex to the mix – and will offer support for Dell Private Cloud and PowerStore on Azure Local, Microsoft's system for running Azure services on in-house data center infrastructure.

"Microsoft and Dell Technologies share a vision of empowering businesses to achieve more through innovation and collaboration," said Dean Paron, VP of product management for Azure Edge Infrastructure at Microsoft.

"By bringing Microsoft Azure Local to Dell Private Cloud and PowerStore, we’re helping customers simplify their IT operations and unlock the full potential of their hybrid cloud strategies," he added.

The partnership comes amid a rising debate over cloud repatriation – the idea of moving workloads from the cloud back to on-premise infrastructure to help reduce costs, increase control, or improve flexibility.

While firms like Basecamp and Ahrefs have saved millions making such a move, hybrid remains the most popular option at 68% of companies, according to one survey.

Private Cloud on Azure

Gordon said the partnership delivered a first for private setups on Azure, and this latest announcement shows the duo want to take things further.

"Dell Private Cloud is the first Azure Local offering… a full-stack solution across compute, external storage, and networking, delivered from a single vendor, with end-to-end solution-level support included," Gordon said.

With Dell Private Cloud, Azure Local users will get automated lifecycle management, with end-to-end automation to help reduce complexity, as well as independent scaling, allowing compute and storage to be managed separately to reduce costs.

Plus, the system offers a disaggregated approach – as Dell puts it – that gives businesses a future-ready, adaptable system.

"This combination of Dell Private Cloud and Dell PowerStore delivers the simplicity, flexibility, and performance customers need to manage both traditional and modern workloads across their IT estate, Gordon said.

PowerStore for flash storage

The addition of PowerStore, Dell's enterprise-grade, all-flash storage solution, will give flexible scalability with built-in data protection, Gordon added.

"Always-on data reduction lowers storage costs without impacting performance, backed by the industry’s best 5:1 DRR (Disaster Risk Reduction) guarantee," Gordon added.

Early access for Azure Local with Dell Private Cloud and PowerStore will begin in Spring 2026, the company confirmed.

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Most UK IT leaders believe their organizations aren’t doing enough to meet their own sustainability targets, new research shows.

In a recent study from IT service management firm Flexera, 93% said sustainability is increasing in priority, yet 83% admit their organization needs to step up.

A confluence of issues are hampering success on this front, however. Rising cloud computing costs are straining budgets, cited by 69% of respondents, while nearly half (46%) said they feel overwhelmed by the volume of cost and usage data they receive.

These surging data volume means sustainability teams are swamped, preventing them from identifying key focus areas.

“Without full visibility of what their technology estate is costing, consuming and emitting, businesses cannot evidence clearly whether cloud and AI investments are advancing or undermining their climate goals,” said Marlon Oliver, senior vice president EMEA at Flexera.

Access to sustainability data is improving, the researchers found, with 79% of IT decisionmakers saying it’s easy to access such data within their organizations. However, sustainability goals often appear to be grouped with regulatory compliance, which is seen as a lower priority than AI integration, cost reduction and risk mitigation.

Flexera recommends integrating sustainability into technology choices, evaluating cloud migration, SaaS adoption, and AI investments through both cost and sustainability lenses.

Similarly, sustainability metrics should be used alongside financial and operational KPIs to guide investments and measure impact.

Always keep sustainability in mind

Crucially, the study noted that sustainability must be taken into account during IT modernization projects. Researchers said these considerations should be prioritized alongside areas such as security and data protection.

Collaboration across IT, procurement, and sustainability teams should also be encouraged, with clear ownership and incentives for sustainable outcomes.

"Closing the gap between sustainability ambition and execution requires integrating sustainability into every facet of IT —from strategy and procurement to daily operations," said Mark Bradley, senior manager, product management, at Flexera.

"By leveraging robust data, fostering cross-functional collaboration and embedding sustainability into decision-making, IT leaders can drive both environmental and business value."

The research comes as the UK prepares for new Sustainability Reporting Standards, expected to apply for accounting periods beginning in 2026.

The standards, which are aligned with the ISSB framework, will require large and listed firms to report more transparently on climate-related risks and impacts, including greenhouse gas emissions and energy use.

For many organizations, that will mean accounting for the footprint of technology operations, such as data centers and cloud infrastructure, where these are a material source of emissions.

“Boards are expected to show climate progress in ways that can be proven against reporting standards," said Oliver

"Right now, IT leaders are facing rising bills and data that do not add up to a clear story. And until that changes, organisations will find it difficult to deliver the results that regulators, and their own stakeholders, now expect."

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Oracle has cast off the shackles of a long-running “perception of lock-in” according to a senior company executive as the cloud giant targets customer flexibility and choice as the key to success with AI.

Speaking to ITPro in the wake of the company’s annual conference Oracle AI World, Jason Rees, SVP for technology and cloud engineering, said the firm aims to offer a “full stack” ecosystem for enterprises ramping up AI adoption.

Key to this approach is a concerted focus on the vital, interlinked layers that are needed to successfully build, deploy, and roll-out AI tools and agents. From the underlying infrastructure to database management and marketplaces packed full of custom AI agents, Oracle is betting that it can be the one-stop-shop for enterprise AI.

The company’s established reputation for reliability with its Oracle Cloud Infrastructure (OCI) forms the foundation of its value proposition with enterprise customers, Rees notes.

Deals with OpenAI and TikTok, for example, are a testament to this, according to Rees, underlining OCI’s compute capacity for organizations seeking scale.

“On stage [at AI World] this year we had TikTok,” he explains. “Now these aren’t necessarily for AI workloads, but just from scale you’ve got OpenAI who talked about the partnership they have with Oracle.”

“The fact is it went from a ‘we need some compute capacity’ to actually ‘you are the one-stop-shop as a partner that will allow us to scale the business,” Rees added.

“The key thing is the underlying infrastructure of OCI is the right platform to be able to allow our customers to scale and do training and inferencing at an infrastructure level with AI.”

Full stack service upgrades

Oracle AI World saw a raft of updates from the cloud computing giant, including deals with AMD, a new AI agent marketplace, the launch of its AI Database 26ai data management platform, and the AI Data Platform for building applications.

Rees tells ITPro the breadth of announcements showcases the company’s approach, with database features in particular seeking to address long-running customer challenges with breaking down data silos. This is a problem many have faced during rapid AI adoption projects.

“I think one of the challenges we often hear with our customers is they've got silos of data everywhere,” he explained. “So you've got different silos of data in our cloud, in another cloud, on premise, whatever those things are.”

“We understand customers are going to have it in our database, they’re going to have it in data lakes, on object storage, et cetera.”

With 26ai, this is about “bringing the AI to the data”, Rees added. Through the data management platform, customers are able to essentially break down these disparate environments, allowing them to fully capitalize on private data sources which feed enterprise AI tools.

Combined with the company’s AI Data Platform, it’s here that IT leaders can fully unlock the value of the technology and begin delivering on promises made to the C-suite.

“Our customers know that to get the real value out of AI, they need to get access to the private data, and they want to do that in the most secure way possible. So the ability within something that we announced, the AI data platform, one of the core tenants is the ability to have a catalog of data,” he explained.

“So whether or not that data exists in our systems or exists in Snowflake or Databricks, the fact is you can reference against that data and use that data as an input into asking more reasoned questions.

“We're looking to bring together all the elements of data in a secure, scalable way, in order that our customers can really get the value out of AI.”

Choice and flexibility

Oracle’s new AI Agent Marketplace, also unveiled at the conference last month, is another example of the company building a more open, flexible ecosystem for both customers and partners, Rees tells ITPro.

The marketplace offers AI agent templates from approved Oracle partners and systems integrators. Independent software providers such as Box and Stripe are also available through the marketplace.

Building on the launch of its AI Agent Studio last year, Rees said this new marketplace has two key motivations. It provides enterprises with flexible options based on their individual needs, while also giving partners an opportunity to engage with a wider array of customers.

“We're not the only ones who are innovating, and if our partners can also innovate, why would we not allow that to be,” he said.

“It's all about choice. It's all about choice. We want to get to a point where a customer can get the value from what we're building, the value of what our partners are building.”

It all started with multi-cloud

This current strategy at Oracle is the culmination of a long-running process at the hyperscaler, starting with delivering interoperability with counterparts in the cloud computing space.

Oracle has focused heavily on multi-cloud capabilities in recent years, securing integrations with key industry stakeholders including Amazon Web Services (AWS) and Microsoft through its Oracle Database@Azure and @AWS services, as well as with Google Cloud.

“The reason we did multi-cloud originally was giving our customers choice, and not having to refactor Oracle databases in different people’s clouds,” Rees explains.

“You had all these workloads, custom applications, commercial applications that were underpinned by the Oracle database. In the beginning we were not able to offer a database service that we can offer now,” he adds.

“When we started with Microsoft, with Azure, we began with just an interconnect, right, a high-speed connection between our clouds that were located on the same campus. That was what customers were happy to take – a split architecture, low latency, and they were happy to do that.”

In forging closer ties with providers like Azure, AWS, and Google Cloud, Rees tells ITPro this allows Oracle to embed its database “directly in the fabric” of other hyperscalers, thereby offering a greater degree of choice.

“This is part of our strategy, making it easy – removing engineering headaches from our customers, our clients, and just making sure that they can get the best use of data and of course, AI going forward.”

Naturally, the company is still keen on encouraging customers to stay within its own OCI ecosystem, but the flexibility afforded by these integrations now makes sense given the state of the industry landscape – and AI focus on the part of enterprises.

“It does feel to me that customers are realizing that multi-cloud gives them optionality,” he told ITPro.

“It really is that ‘what's the right cloud for the right workload’ type thing, and it really does allow customers to say, well ‘I've got no legacy issues, I’m saving on egress costs with network traffic, but I'm getting the best out of the tool set that I'm choosing to use’,” Rees added.

“I also think it's just the right thing to do.”

The cloud is inescapable in 2025. It’s a $750 billion industry that underpins the vital applications, services, and platforms that power the digital economy.

Yet after more than a decade of enterprise migration and innovation in the cloud, analysis from IT infrastructure firm Kyndryl suggests many spent that time building sprawling, splintered architectures without a clear cut end goal in mind.

In the company’s annual Cloud Readiness Report 70% of CEOs admit they built their current cloud environment “by accident, rather than by design” – this often entailed periodic upgrades aimed at addressing short-term needs, rather than focusing on longer term strategic improvements.

Kyndryl said this shows that many lacked a “deliberate strategy” when pursuing cloud transformation projects, and the effects of this are starting to show with huge workload pressure placed on cloud environments, as well as growing security threats and evolving regulatory requirements.

“If companies benefitted from happenstance in the past, those days are over,” the report states. “Cloud success is no longer a matter of luck but design. The enterprises that thrive now are those that approach cloud as the foundation for intelligence, adaptability, and trust.”

AI is among one of the key factors bringing this lack of clear cut focus to light in 2025, according to Kyndryl. Organizations have increased cloud spending by 30% on average so far this year in a bid to supercharge AI adoption and build out infrastructure capacity to meet demand.

89% said these cloud investments have “made it easier to use AI” and have proved beneficial in underpinning adoption projects. Poorly designed, piecemeal cloud environments are hampering innovation on this front, however, the study added.

Indeed, 35% cited integration challenges as a top barrier to delivering a return on investment (ROI) with the technology.

Hybrid and multi-cloud in the spotlight

According to Kyndryl, hybrid and multi-cloud represent the light at the end of the tunnel for many enterprises locked in monolithic, rigid cloud setups.

Both these approaches have gained significant traction in recent years, the study found, with 84% of IT leaders revealing they now “intentionally use multiple clouds”.

Meanwhile, 41% are switching to a hybrid approach, repatriating data to on-premises environments while still hosting non-critical workloads on public cloud. This enables enterprises to balance control, compliance, and performance, the study noted.

“The gap between a reactive and deliberate cloud strategy has never been more consequential,” said Nicolas Sekkaki, global cloud practice leader at Kyndryl.

“With AI demanding seamless data access and governance requirements rapidly evolving, a hybrid cloud model is the differentiator that enables successful AI adoption,” he added.

AI-related considerations aren’t the only driving factor behind the shift to hybrid cloud, however. Kyndryl noted that geopolitical concerns and a concerted focus on data sovereignty, spurred on by regulatory requirements, are also influencing the trend.

75% of leaders said they were concerned about “the geopolitical risks associated with storing and managing data in global cloud environments”, for example, while 65% revealed they’ve “made changes to their cloud strategies” because of compliance concerns.

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OpenAI will start using AWS to scale AI systems to answer queries and for training, as the company continues to expand its partnerships beyond Microsoft.

The $38 billion, multi-year deal will give OpenAI access to hundreds of thousands of Nvidia GPUs, with the ability to scale up as necessary, the companies noted.

OpenAI will begin using AWS immediately, with all the capacity targeted to be deployed before the end of this year, and further expansion planned for next year.

"Scaling frontier AI requires massive, reliable compute," said OpenAI CEO Sam Altman in a statement. "Our partnership with AWS strengthens the broad compute ecosystem that will power this next era and bring advanced AI to everyone."

OpenAI noted that the infrastructure that AWS is setting up for OpenAI is designed to boost processing efficiency and performance.

This will be organized into clusters of Nvidia GB200s and Nvidia GB300s via Amazon's EC2 UltraServers, all on the same network for low latency. Those clusters will be designed to support different workloads, from answering ChatGPT queries to training future models, adapting as needed by OpenAI.

"As OpenAI continues to push the boundaries of what's possible, AWS's best-in-class infrastructure will serve as a backbone for their AI ambitions," said AWS chief executive Matt Garman.

"The breadth and immediate availability of optimized compute demonstrates why AWS is uniquely positioned to support OpenAI's vast AI workloads."

Is OpenAI trading Azure for AWS?

OpenAI has had a close partnership with Microsoft since 2019, centered on billions in investment from the firm as well as Azure access. But that partnership lost exclusivity in January and reports of tensions around OpenAI's move to a new structure.

That said, OpenAI continues to use Azure, and last week signed a $250 billion agreement to continue the partnership, but is at the same time expanding its options to avoid overreliance on one hyperscaler.

In recent months, the AI company has signed massive deals with both Google Cloud and Oracle, with the latter worth around $300 billion alone.

AI spending spree

OpenAI's massive contract with AWS further fuels concerns that AI companies are spending too much on infrastructure without the revenue to support such deals, sparking the threat of another tech bubble.

OpenAI runs at a loss, and is expected to post $20 billion in revenue this year, while this time last year it was trying to scrounge up $6 billion in investment just to keep the lights on.

Despite that, Altman said last week that OpenAI had already committed to spending $1.4 trillion over multiple years, which includes deals with cloud providers as well as multibillion-dollar contracts with Nvidia, AMD, and Broadcom.

Altman justified the huge spending spree during an interview with BBC News last month, noting that while the “investment loans are unprecedented…it’s also unprecedented for companies to be growing revenue this fast”.

Earlier this month, ITPro reported that the company was lining up ways to fund its AI ambitions, including adding subscribers, creating a personal AI device, and adding a checkout for AI-powered shopping.

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Oracle has announced the launch of a new marketplace where customers can access a range of AI agents.

Unveiled at the company’s annual CloudWorld conference, the cloud computing giant said the move aims to ramp up agentic AI adoption and provide enterprises with a variety of options.

The marketplace will primarily feature AI agent templates and options from approved Oracle partners and systems integrators, but independent software vendors such as Box, Stripe, and Loqate are also featured.

“The age of intelligent automation has arrived, and in order to stay competitive, organisations need solutions that are powerful, scalable, and easy to adopt,” said Chris Leone, executive vice president of applications development at Oracle.

“With Oracle AI Agent Marketplace, we’re helping our customers fast-track enterprise AI adoption, address their unique business needs, and streamline operations by bringing our growing network of partner expertise directly into our AI ecosystem”.

So what can Oracle customers expect from the new marketplace setup?

Under the hood of the Oracle AI Agent Marketplace

The new marketplace will feature partner-built agent templates that customers can choose based on their individual needs.

A host of systems integrators from the Oracle PartnerNetwork are involved in the scheme, the company revealed, including IBM Consulting, Wipro, Apex IT, and more.

Other systems integrators such as Accenture, Deloitte, KPMG, and PwC also have agent templates for joint customers.

As an example, Oracle pointed to KPMG’s Purchase Order Item Price History agent, which is designed to help enterprises streamline procurement processes.

“It can reduce manual research time and deliver deeper insights to optimize negotiation strategies by providing rapid access to historical purchase order data such as previous suppliers, purchase dates, average price over past orders, and actionable pricing insights for current orders,” the company explained in a statement.

One-stop agent shops are the new big thing

The launch of the Oracle service marks the latest in a string of marketplace launches from big AI and cloud providers in recent months.

In September, Microsoft announced the launch of its own marketplace where customers can pick and choose from a range of in-house and third-party product options.

The ‘Microsoft Marketplace’ features products spanning cloud solutions, AI applications, and agent templates for enterprise users.

Elsewhere, Amazon Web Services (AWS) has continually updated its Bedrock service. First launched in mid-2024,

Amazon Bedrock was initially intended as a marketplace for AI models, providing customers with access to tools from Anthropic, OpenAI, and its own in-house options – agents are now available through the marketplace.

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Microsoft has announced the launch of a new ‘marketplace’ which allows customers to pick and choose a variety of in-house and third-party products.

In an announcement on 25 September, the tech giant confirmed Microsoft Marketplace will offer customers a “trusted source for cloud solutions, AI apps. and agents”.

The new marketplace will essentially act as an extension of Microsoft Cloud, allowing partner organizations to engage with customers and providing a broader array of options.

Part of the move includes the unification of Azure Marketplace and Microsoft AppSource to create a single point of contact.

Here's what customers can expect from the new service.

What to expect with Microsoft Marketplace

A key feature highlighted by Microsoft includes the launch of a new AI Apps and Agents category. This, the tech giant said, will act as a single source for AI applications and agents offered by the company’s partner ecosystem.

This category boasts over 3,000 apps and agents, the company said, such as Azure AI Foundry or Microsoft 365 Copilot.

“Microsoft Marketplace gives you access to thousands of AI apps and agents from our rich partner ecosystem designed to automate tasks, accelerate decision-making and unlock value across your business,” said Alysa Taylor, CMO for commercial cloud & AI at Microsoft.

“With a new AI Apps and Agents category, you can easily and confidently find AI solutions that integrate with your organization’s existing Microsoft products."

Elsewhere, the marketplace looks to consolidate the tech giant’s range of cloud solutions, allowing customers to pick and choose based on their specific industry and use-cases.

This spans all of the company’s core product lines, from Microsoft 365 to Azure.

“Microsoft Marketplace offers solutions across dozens of categories ranging from data and analytics to productivity and collaboration, in addition to industry-specific offerings,” Taylor said.

“Microsoft Marketplace is a seamless extension of the Microsoft Cloud, uniting solutions integrated with Azure, Microsoft 365, Dynamics 365, Power Platform, Microsoft Security and more.”

A chip off the Amazon block

The new setup from Microsoft bears similarities to Amazon Bedrock, the hyperscaler’s own ‘marketplace’ for AI solutions. The service, which launched in 2023, allows customers to choose from a range of in-house and third-party AI models.

As ITPro reported at the time of launch, the managed service offered AWS a quick route into the generative AI race, simplifying access for customers.

The tech giant framed Bedrock as the “easiest way to build and scale enterprise-ready generative AI applications”.

It’s proven highly successful in recent years, with Bedrock receiving repeated updates, including a sweeping batch of new offerings at its annual conference in Las Vegas last year.

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Oracle has secured a $300 billion contract with OpenAI to underpin the company’s surging compute requirements, marking the latest big win for the hyperscaler.

According to reports from the Wall Street Journal, the contract is set to commence in 2027 and will see Oracle expand the underlying infrastructure required to power OpenAI models.

This marks the latest in a string of deals struck by OpenAI to support future expansion as the firm scrambles to match skyrocketing power demands.

Compute power has been frequently identified as a key bottleneck for the company as it ramps up AI development.

Microsoft, OpenAI’s long-term partner and financial backer, has been a key player in supporting the firm through its Azure cloud computing service. But with reports of strained relations between Microsoft and OpenAI gaining traction in recent months, the latter has been looking elsewhere for industry support.

In June 2024, a deal between Oracle, Microsoft, OpenAI was announced to provide the latter with “additional capacity”. At the time, the company said this was to support “inference and other needs”.

Notably, the deal marked a huge shift away from Microsoft, which until that point had been OpenAI's exclusive cloud provider.

Similarly, earlier this year OpenAI and Oracle agreed to partner on the Stargate Project, a $500 billion initiative aimed at building out AI infrastructure across the United States.

Oracle is capitalizing on AI

Oracle is fast emerging as one of the big winners from the increasingly frantic generative AI race.

In its most recent earnings report, the company revealed it added upwards of £317 billion in future contract revenue, with OpenAI responsible for a huge chunk of this.

Shares surged following the earnings report and Larry Ellison’s personal wealth skyrocketed.

Elsewhere, the company has made significant gains in areas such as multi-cloud, again driven by surging AI demands. Enterprises globally are shifting to a hybrid or multi-cloud approach as a result of the generative AI race, and it’s a trend that Oracle has been keen to capitalize on.

At the Oracle CloudWorld Tour London conference in March this year, the hyperscaler announced an expansion of its multi-cloud relationship with Azure.

This followed confirmation of a similar partnership with AWS at its annual conference in Las Vegas just months prior.

High stakes for OpenAI

OpenAI’s blossoming relationship with Oracle doesn’t come without risk, however.

As sources told the WSJ, this is a deal that “far outstrips” the company’s current revenue, which is reported to stand at around $10 billion.

Under the terms of the agreement, OpenAI will essentially owe Oracle an average of $60 billion a year.

The deal also rests heavily on whether OpenAI’s current growth trajectory continues as it looks to draw more customers across both the enterprise and consumer markets.

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Mainframe modernization efforts are gathering momentum, according to new research, with enterprises unlocking significant performance gains and cost savings.

Figures from Kyndryl’s 2025 State of Mainframe Modernization survey show project costs have decreased significantly while returns on investment (ROI) have increased in parallel.

Kyndryl noted that respondents have reported an ROI of between 288% to 362% on mainframe modernization initiatives, which have traditionally proven costly.

Similarly, 80% said they’ve actively shifted modernization efforts in the last year in a bid to contend with an influx of emerging technologies, such as generative AI.

AI is now a “present-day business catalyst” rather than a future consideration when embarking on mainframe modernization projects, the survey found. Nearly 90% of enterprises have implemented – or plan to implement – generative AI on the mainframe.

This, Kyndryl said, is expected to deliver huge long-term benefits. Enterprises forecast upwards of $13 billion in savings alongside $20 billion in new revenue opportunities from mainframe AI integration over the next three years.

“The mainframe has become the AI-fueled catalyst of hybrid enterprise strategies, delivering billion-dollar returns while powering innovation for customers,” said Hassan Zamat, Global Practice Leader for Core Enterprise at Kyndryl.

“Organizations are taking a much more pragmatic approach to modernization to drive better business outcomes and incorporate new technologies. Working with the right partners can help them build a resilient, secure and future-ready platform.”

Mainframes are the backbone of hybrid IT

Notably, the Kyndryl survey found that mainframes now form the backbone of hybrid IT strategies.

More than half (56%) of respondents reported increased usage of the platform over the last 12 months, which now forms a “key component” within integrated hybrid environments.

“42% say they are placing more focus on modernizing directly on the mainframe and 50% are moving more towards a hybrid strategy,” the report noted. “That 50% is comprised of 34% prioritizing integration with cloud platforms, and 16% are increasing the pace of moving applications off the mainframe.”

“This clear trend toward hybrid strategies blends on-platform modernization with enhanced cloud connectivity,” it added.

Mainframes were expected to die out with the advent of cloud computing as enterprises shifted to more agile storage options. While there has been a notable decrease, recent studies have shown enterprises are coming back around.

Analysis from application modernization firm Advanced in February 2024 found more than half (52%) of companies planned to maintain or increase their dependency on mainframes.

A similar number said mainframes were their preferred platform for core applications and legacy applications hosted on mainframe infrastructure.

As with the Kyndryl survey, research from Advanced specifically highlighted the hybrid approach enterprises are now adopting. Around 92% of respondents said they favored a hybrid cloud approach with incorporated mainframes,

Advanced said that a division of deployment was emerging, with mainframes used for core applications and cloud for innovation, with 92% favoring a hybrid cloud approach.

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Google Cloud has announced the launch of a new multi-cloud data transfer service for enterprises based in the UK and European Union (EU).

In a blog post Jeanette Manfra, senior director for global risk and compliance at Google Cloud, said the new Data Transfer Essentials scheme comes in direct response to cloud interoperability principles outlined in the EU Data Act.

“Data Transfer Essentials is a new, simple solution for data transfers between Google Cloud and other cloud service providers,” Manfra said.

Notably, under the terms of the EU Data Act, cloud providers are allowed to “pass through costs to customers” for data transfers. Manfra noted that the Google service will come “at no cost to customers”.

Key competitors including Microsoft and Amazon Web Services (AWS) also provide data transfer options for customers. In Microsoft's case these come at a cost to the enterprise, while AWS allows EU customers to transfer data at a reduced rate.

“The original promise of the cloud is one that is open, elastic, and free from artificial lock-ins,” Manfra wrote.

“Google Cloud continues to embrace this openness and the ability for customers to choose the cloud service provider that works best for their workload needs.”

What to expect with Google Cloud's data transfer scheme

According to Google, the new service is specifically designed for “in-parallel” processing of workloads distributed across multiple cloud providers, giving enterprises greater flexibility.

“Data Transfer Essentials enables you to build flexible, multi-cloud strategies and use the best-of-breed solutions across different cloud providers,” Manfra said.

“This can foster greater digital operational resilience – without incurring outbound data transfer costs from Google Cloud.”

Data transfer costs, also known as “egress fees”, have become a point of contention in the cloud computing industry in recent years.

With enterprises flocking to hybrid and multi-cloud strategies, the costs associated with transferring workloads to alternative providers have been a major hurdle.

Indeed, egress fees were a key talking point in a recent probe into the state of the UK’s cloud computing industry. The investigation, conducted by the Competition and Markets Authority (CMA) following an initial probe by Ofcom, found egress fees created significant barriers to multi-cloud adoption.

“Customers face both commercial and technical barriers when seeking to multi-cloud or switch their cloud provider and many currently think that the costs outweigh the benefits,” the CMA reported in early August.

“Barriers to multi-cloud negatively affect many customers’ ability to use and integrate multiple public clouds, and this limits customers’ ability and incentive to exercise choice over their cloud provider."

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Citrix has warned products sold under a legacy licensing scheme will face a “loss of functionality” as the company shifts to a new framework next year.

In a blog post published 8 September, the company detailed plans to move to the new licensing scheme, which is set to come into effect in April 2026. Citrix said this shift will deliver a cloud-based framework in a bid to deliver “streamline licensing and faster support”.

Citrix currently operates under a file-based licensing system, which means that customers receive license files specifically applied to customer-hosted servers or NetScaler consoles. Notably, this means product activations and features require a significant amount of manual management.

Jose Augustin, senior director of product management at Citrix, noted this legacy setup has become an “operational slowdown for users”.

“Manual renewals, file management, and frequent outages tied to licensing issues have generated thousands of support cases every quarter,” he wrote.

“Modern Citrix licensing, with its cloud-based architecture, deeper insight through telemetry, and automated processes, will reduce risk and enable faster, more effective support.”

What the new Citrix licensing scheme offers

Under the new cloud-based License Activation Service (LAS), the firm said it aims to simplify customer experiences by “significantly reducing” operational overheads and automating the process.

This means customers won’t need to manually download, allocate, or manage license files, while entitlement updates will be automated.

“Entitlements are updated automatically in the background upon contract renewal, ensuring uninterrupted service,” Augustin wrote.

“Increased resiliency” was another key advantage touted by the firm. Under the LAS setup, license servers will no longer be a “single point of failure for users sessions” and improve environment stability.”

Looking forward, Augustin said the new LAS system will help the company gain deeper insights into product usage, which will support future R&D projects.

“We continuously gather anonymous, aggregated data on how our products are used,” he wrote. “This “always-on” data shapes our future roadmap, enabling us to deliver features and improvements that directly address your needs and pain points.

“This data-driven approach allows us to allocate our R&D investments more strategically, building higher quality products.”

What Citrix products are impacted?

In a separate advisory, Citrix noted that a raft of products will come under the LAS setup next year, including:

• Citrix Virtual Apps and Desktops
• Citrix Provisioning (PVS)
• NetScaler
• XenServer
• Unicorn Scout

After the April 2026 deadline, Citrix warned these products will “stop recognizing file based licenses and will result in a loss of functionality and potential impacts on end-users”.

Exactly what this “loss of functionality” entails is yet to be revealed. ITPro has approached Citrix for clarification.

Augustin urged customers to engage with Citrix partners to help support the transition, adding that previous implementations of this licensing model have delivered improvements.

Since late 2024, Citrix has offered LAS support for Citrix Virtual Apps and Desktops, for example. Augustin noted the firm has “seen hundreds of customers and partners move to utilize this offering with positive reception”.

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SAP has announced a significant expansion of its sovereign cloud offering with a new “On-Site” solution.

The launch of the On-Site model will give customers the ability to host managed cloud infrastructure within their own facilities in a move the tech firm said provides the “ultimate level of physical control and data residency”.

Thomas Saueressig, member of the executive board of SAP SE for customer services and delivery, said the expansion is in direct response to growing enterprise calls for heightened data sovereignty controls.

“Organizations around the world are seeking greater control over their digital environments,” Saueressig said.

“With Sovereign Cloud On-Site, SAP empowers customers to define their own sovereignty boundaries while leveraging our global infrastructure expertise and partnerships.”

The new On-site option aims to offer “flexible sovereignty models” that meet the needs of organizations operating across various areas, SAP said, particularly governments and businesses in regulated sectors.

Varied deployment options mean organizations can choose between SAP-hosted infrastructure, hyperscaler-based models, or customer-site hosted options.

“With SAP Sovereign Cloud On-Site, we are redefining what sovereignty means for our customers,” said Martin Merz, president of SAP’s sovereign cloud division.

“By placing SAP-managed infrastructure directly within customers’ own facilities, we offer unmatched control, compliance, and operational assurance without compromising innovation.”

What to expect from SAP’s sovereign cloud

SAP said its sovereign cloud initiative centers around a series of “core capabilities”, which naturally includes a strong focus on data sovereignty.

Under the scheme, organizations retain full ownership and control of sensitive data, based on local regulatory requirements.

“Operational sovereignty” features allow enterprises to manage environments with SAP resources while “technical sovereignty” enables customers to run SAP workloads using deployment options based on their individual needs - this applies to those operating in regulated industries, for example.

Sovereign cloud in the spotlight

Data sovereignty has become a recurring talking point on both sides of the Atlantic in recent years. In May 2024, industry analysts told ITPro that sovereign cloud services are now the “bare minimum” expected from European customers.

A key factor behind this growing demand is the array of stringent regulatory requirements introduced - or currently being introduced - in Europe. Naturally, providers have acted swiftly to meet this demand.

A host of industry heavyweights, including Google Cloud, Amazon Web Services (AWS), Microsoft, and Oracle, have all since launched dedicated sovereign cloud services for European customers.

Recent months have seen new concerns arise about data sovereignty, with research showing enterprises in the UK and EU both cited worries about US interference.

These concerns came after the Trump administration issued a memorandum in early 2025 pledging to defend American tech companies from “overseas extortion”.

In the wake of the move, Microsoft president Brad Smith said the tech giant would resort to legal action to protect EU customers from US demands to shut down services.

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Google has won a six-year, $10 billion cloud contract from Meta, supporting the tech giant’s plans to ramp up investment in AI.

According to two people who spoke to The Information, the deal covers the use of Google Cloud’s datacenter servers, storage, networking and other services.

A source close to Google has since told ITPro that the story is correct.

The agreement is a big coup for Google, and follows a recent deal with OpenAI which saw it pry away business away from Microsoft Azure. It will be the biggest ever for the company's cloud unit.

Google has been trailing behind Amazon Web Services (AWS) and Microsoft Azure in the cloud market - but it’s catching up, recording growth of more than 30% last year, according to Canalys, compared with just 17% for AWS.

Meanwhile, according to Gartner, AWS still leads the pack in the Infrastructure as a Service (IaaS) cloud market, with a 37.7% market share.

Microsoft, meanwhile, has seen its market share rise from 23% to 23.9%, while Google's increased from 8.2% to 9%.

Google Cloud last month reported $2.83 billion in operating income, on $13.6 billion in revenue for the second quarter, with the unit's revenue growth of 32% ahead of the 13.8% growth for the company as a whole.

Google's cloud win to underpin Meta AI drive

This agreement forms part of Meta's big AI infrastructure drive, with CEO Mark Zuckerberg saying that the firm plans to invest hundreds of billions of dollars in the technology and underlying foundations to support the strategy.

"Meta believes strongly in building personal superintelligence that empowers everyone," said Zuckerberg at the end of last month.

"We have the resources and the expertise to build the massive infrastructure required, and the capability and will to deliver new technology to billions of people across our products."

In its second-quarter earnings report, the company said it plans to more than double its spend on building AI infrastructure, including datacenters.

“We expect that developing leading AI infrastructure will be a core advantage in developing the best AI models and product experiences, so we expect to ramp our investments significantly in 2026 to support that work,” said CFO Susan Li.

Meta is expanding its AI infrastructure with the construction of more datacenters, including the one-gigawatt Prometheus in Ohio and Hyperion in Louisiana - expected to eventually expand to five gigawatts - these facilities could take years to come online.

At the beginning of this month, it announced plans to work with outside partners to help fund its AI efforts, saying it planned to sell off $2 billion in datacenter assets to help do this.

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Amazon Web Services (AWS) still leads the pack in the rapidly-growing Infrastructure as a Service (IaaS) cloud market – but its lead is narrowing.

According to research from Gartner, AWS maintained its lead in the IaaS space across 2024 with a 37.7% market share and revenues of $64.8 billion.

However, analysis from the consultancy showed a poorer performance compared to the year prior, when it held 39% of the market.

While this represents a marginal decline, gains at key competitors highlight growing pressure on the hyperscaler. Microsoft, for example, saw its market share rise from 23% to 23.9% while Google's increased from 8.2% to 9%.

Elsewhere, market share at Alibaba and Huawei also dipped across the year, Gartner found.

“Cloud providers are investing heavily in AI infrastructure and capabilities to become leaders in the rapidly evolving AI-optimized IaaS market," said Hardeep Singh, principal analyst at Gartner.

"They expect that AI will become a much larger revenue contributor in the future, even though it currently remains a relatively small slice of their overall revenue within the IaaS space."

Overall, the worldwide infrastructure as a service (IaaS) market grew 22.5% in 2024, reaching $171.8 billion.

This growth, Gartner noted, is driven by a demand for flexibility with data residency and sovereignty, as enterprises seek to gradually transition to the cloud while keeping control over their data and operations.

"As enterprises continue to seek greater flexibility, improved resilience and optimized performance, there is sustained demand for cloud migration and modernization services," Singh added.

"Enterprises want to transform their IT infrastructure by leveraging multiple platforms for AI and prioritizing modernization by migrating existing workloads to the cloud. They are also deploying cloud native applications across diverse environments.”

Meanwhile, emerging AI-optimized IaaS offerings from non-hyperscalers or GPU as a service (GPUaaS) providers are also playing a key role in addressing immediate capacity requirements by offering flexible, high-performance compute on demand.

Amazon’s cloud dominance faces big challenges

Gartner’s research isn’t the first to point to a declining state of affairs for AWS in recent months. A report from Canalys earlier this year showed sluggish growth rates for the hyperscaler, recording just 17% in the first quarter of 2025.

This not only marked a decrease compared to the 19% recorded in Q4 2024, but came in sharp contrast to growth rates of more than 30% at Microsoft and Google Cloud.

Growth is being driven by both enterprise end-users and providers, said Canalys, with leading hyperscalers ramping up their efforts to optimize infrastructure to accommodate AI adoption.

Amazon is also facing increased pressure in the UK alongside Microsoft over its market dominance.

After a three-year investigation, the UK's Competition and Markets Authority (CMA) issued a report late last month concluding that the two companies have "significant unilateral market power" in the UK's cloud infrastructure services market.

Combined, the two cloud computing giants command a 70% market share, dominating in both the IaaS and PaaS domains, the CMA found.

The competition watchdog recommended that both companies be assessed for Strategic Market Status (SMS), which could lead to targeted interventions to encourage greater competition.

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AWS is attempting to allay fears over its European Sovereign Cloud, promising that it will be operated by EU citizens only.

The service will be the only fully-featured, independently operated sovereign cloud, according to the hyperscaler, backed by strong technical controls, sovereign assurances and legal protections.

Notably, the service will have no critical dependencies on non-EU infrastructure.

As part of the shift, EU citizenship is to be added to the company's hiring requirements for AWS employees operating the cloud. This will ensure that staff with control of day-to-day operations, including access to data centers, technical support, and customer service will be EU residents exclusively, subject to EU law.

"The AWS European Sovereign Cloud is designed to provide customers with an autonomous cloud that operates independently in Europe and for Europe," the company said in a statement.

According to AWS, the move replicates a widely-used mitigation mechanism that's already established in the hiring practices of EU institutions and governments.

In the meantime, the company will continue to work as a blended team of EU residents and EU citizens, with all personnel working from EU locations, before gradually completing the switch to EU citizen operations for the sovereign cloud service.

"We are committed to supporting any employees impacted by this transition, and redeploying builders who do not meet the EU citizen eligibility requirement into other roles within Amazon," said the firm.

AWS said it's on track to launch the AWS European Sovereign Cloud by the end of this year, backed by a €7.8 billion investment through 2040.

The announcement comes as concern rises in the EU that sovereign cloud isn't always as ‘sovereign’ as it should be. The US Cloud Act means that companies can be forced to hand over data, regardless of where it is stored.

Last month, Anton Carniaux, Microsoft France's director of public and legal affairs, admitted that he couldn't guarantee that French citizen data would never be transmitted to US authorities without explicit French authorization.

The admission came during testimony before a French Senate inquiry into the role of public procurement in promoting digital sovereignty.

Recent analysis from Synergy Research Group found that US cloud providers, including Amazon, Microsoft and Google Cloud, hold a 70% share of the European market, compared with just 15% for local firms.

IT leaders are also becoming increasingly concerned about the influence of US-based cloud providers on the European market. More than half of UK IT leaders using public or hybrid cloud setups told Asanti that they’re planning to ditch US firms as a result of data sovereignty concerns.

AWS is keen to impress that its existing relationships with European regulators will be enough to calm worries about US overreach on this front.

"We’ve had deep engagements with European regulators, including national cybersecurity and data protection authorities, and customers to understand their sovereignty requirements and test our sovereignty approach,” the firm said.

“We designed the AWS European Sovereign Cloud to meet these stringent regulatory, data residency, and operational needs."

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The UK Competition and Markets Authority (CMA) has accused Microsoft and Amazon of harming competition in the country’s cloud computing market.

Following a long-running probe into the state of the industry, the regulator warned competition in the space is “not working well”, highlighting an array of business practices it said hampers competition.

The probe pointed specifically to a trend of market concentration in the Infrastructure as a Service (IaaS) space, noting that Amazon and Microsoft command “significant unilateral market power”.

Amazon and Microsoft are the two largest providers in this domain, each of which controlled a share of the market ranging between 30-40%, as of 2024.

The Platform as a Service (PaaS) market also showed signs of concentration, according to the CMA, with Microsoft’s share having increased to 20-30% since 2020.

All told, this market concentration is hampering the ability of competitors to enter the space, the CMA alleges.

“There are substantial barriers to entry and expansion in cloud services, particularly in IaaS as this requires significant capital investment in fixed assets such as data centers, networks and servers, and components which become largely a sunk cost,” the CMA report reads.

“There are also economies of scale, meaning that larger cloud providers have lower average costs compared to smaller providers,” it added.

“The largest cloud providers are making substantial investments in IaaS and AI capabilities to expand their services in coming years, and while this investment can have pro-competitive effects and benefit cloud customers, it may also deter market entry or expansion by potential rivals.”

The enterprise impact of cloud practices

A key focus of the CMA probe has been egress fees. The regulator noted that the number of customers switching suppliers each year was low – only around 1% – it suggested this could be more to do with barriers to doing so rather than businesses’ preferences.

“Customers face both commercial and technical barriers when seeking to multi-cloud or switch their cloud provider and many currently think that the costs outweigh the benefits,” the report noted.

“Barriers to multi-cloud negatively affect many customers’ ability to use and integrate multiple public clouds, and this limits customers’ ability and incentive to exercise choice over their cloud provider."

This applies equally to small businesses and larger enterprises, the CMA said, with the former lacking the financial resources and the latter facing high fees due to the large quantities of data they have stored in the cloud.

In addition to cloud-related concerns, the CMA also took issue with Microsoft’s licensing practices. It argued that the tech giant incentivizes customers to use Windows Server through its Azure cloud service rather than competing options.

This, the regulator noted, “further restricts” the limited choices faced by enterprises.

Recommendations outlined by the CMA report include a further investigation into AWS and Microsoft under the Digital Markets, Competition and Consumers (DMCC) Act.

“We recommend that the CMA Board use its digital markets powers to prioritize commencing SMS investigations to consider designation the two largest providers, Microsoft and AWS, with strategic market status in relation to their respective digital activities in cloud services,” the report states.

Microsoft and AWS hit back at CMA ruling

Microsoft and AWS have hit back at the regulator in the wake of the ruling. A Microsoft spokesperson said the report “misses the mark again”, and claimed the industry has “never been so dynamic and competitive”.

“Its recommendations (also) fail to cover Google, one of the fastest-growing cloud market participants,” the spokesperson said.

“Microsoft looks forward to working with the Digital Markets Unit toward an outcome that more accurately reflects the current competition in cloud that benefits UK customers.”

A spokesperson for AWS issued an equally scathing response to the report, saying it “disregards clear evidence of robust competition” in the UK IT services industry.

“The action proposed by the Inquiry Group is unwarranted and undermines the substantial investment and innovation that have already benefitted hundreds of thousands of UK businesses,” the spokesperson said.

“It risks making the UK a global outlier at a time when businesses need regulatory predictability for the UK to maintain international competitiveness. We will continue to engage constructively with the CMA as they consider their next steps.”

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EU-based cloud providers have seen their local revenues triple in recent years, new research shows, but there’s still a long way to go until they can break the dominance of US tech giants.

Analysis from Synergy Research Group shows US providers - including Amazon, Microsoft, and Google Cloud - command a 70% share of the European market compared to just 15% for regional firms.

Compounding the situation for European firms is the fact the market has grown by a factor of six over the last eight years, meaning the market share for local providers has fallen from 29% in 2017.

There is light on the horizon, however. Synergy noted that this 15% share has held steady since 2022, suggesting no further inroads from US giants.

The figures come amid a period of renewed demands for local cloud infrastructure and concerns over data sovereignty, with regional IT leaders reportedly ‘skittish’ over the influence of US cloud companies.

Despite calls for a more localized approach to cloud computing, the reality is that cloud is a market where size really does matter, according to John Dinsdale, chief analyst at Synergy.

"The cloud market is a game of scale where aspiring leaders have to place huge financial bets, must have a long-term view of investments and profitability, must maintain a focused determination to succeed, and must consistently achieve operational excellence," he said.

"No European companies have come close to that set of criteria and the result is a market where the five leaders are all US companies."

US cloud providers are investing heavily

The big American players have set aside whopping sums for capital expenditure programs with AI sparking new infrastructure demands and capacity.

Earlier this year, Microsoft detailed plans to spend around $80 billion on infrastructure expansion while Google recently announced an additional $10 billion, taking its total to $85 billion for the year.

A significant portion of this investment is flowing into Europe, with Microsoft spending $400 million to expand its Swiss data centers and $2.1 billion for cloud and AI infrastructure in Spain.

AWS, meanwhile, plans to spend £8 billion in the UK over the next five years.

"As US cloud providers continue to invest some €10 billion every quarter in European capex programs, that presents an impossible hill to climb for any companies who wish to seriously challenge their market leadership," Dinsdale added.

Some of that investment has been driven by efforts by American cloud providers to build sufficient local infrastructure to hold European data in Europe - and protect that from external pressure.

Both Google and Microsoft have pledged to protect local data via their sovereign cloud services. Last year, AWS revealed a €7.8 billion investment into AWS European Sovereign Cloud over the next 15 years.

American cloud providers have been hit by regulatory action in Europe, with Microsoft recently settling with Cloud Infrastructure Services Providers in Europe (CISPE) over a long-running licensing disagreement.

European cloud growth

That American dominance has left local providers battling it out for a small handful of customers, Dinsdale noted, creating an incredibly strained and competitive marketplace.

SAP and Deutsche Telekom each hold 2% of the European market, for example, followed by OVHcloud, Telecom Italia, and Orange.

Other regional players and smaller American and Asian cloud providers are also in the mix.

"Consequently European cloud providers have mostly settled into positions of serving local groups of customers that have some specific local needs, sometimes working as partners to the big US cloud providers," Dinsdale added.

"While many European cloud providers will continue to grow, they are unlikely to move the needle much in terms of overall European market share.”

Synergy said European cloud infrastructure service revenues were €36 billion in the first half of 2025, predicting annual spend would grow by a quarter versus last year.

Public IaaS and PaaS services make up the bulk of the market, the report added, with AI driving the market with up to 160% growth in relevant services.

The UK and Germany remain the biggest markets for cloud, but Ireland, Spain, and Italy are seeing the highest growth rates.

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VMware is rejigging its cloud channel program once again – and as of yet it’s unclear which partners will be invited to join the new version.

First reported by The Register last week, Australian reseller, Interactive, revealed Broadcom has contacted VMware Cloud Service Providers to alert them that a new Cloud Service Provider program will begin in November.

The new framework is invitation only and will slash the number of authorized partners — with suggestions that Broadcom is choosing to focus on bigger players.

Any existing partners who will not be included have already been sent a notice of non-renewal, Interactive said in its post.

This means they will be able to continue offering services until 31 October. However, after that they'll only be able to continue servicing existing contracts until the end of their terms, with no new contracts allowed.

Interactive added that Broadcom is ending its white label program, which was only started last year to help alleviate concerns in the partner community.

The move basically means some partners will lose their VMware business, while their customers will need to find a new supplier ahead of the end of their contract, if affected, and migrate their systems.

Why the change?

According to Interactive, the change is part of Broadcom’s continued efforts to “align the VMware partner ecosystem with its strategic efforts and the needs of customers”.

In a statement given to ITPro, a spokesperson confirmed the move, noting that the new strategy forms part of its goal to drive simplification, consistency, and innovation across the VMware Go To Market ecosystem”.

“Recent changes to this ecosystem are consistent with this strategy. Broadcom is focusing more and going deeper with the VCSPs who have demonstrated commitment to their cloud services built on VMware,” the spokesperson added.

“This will enable us to deliver greater value, stronger execution, and a more streamlined experience for Broadcom's VMware customers of all sizes and enable a truly competitive offering to the hyperscalers through our CSPs."

Broadcom changes have spooked VMware customers

The change to the VMware Cloud Service Providers system is the latest disruption in the wake of Broadcom's $61 billion acquisition of the virtualization giant.

Since the acquisition, Broadcom has introduced a series of licensing tweaks that have frustrated customers and partners.

A report by the European Cloud Competition Organisation — set up to monitor Microsoft's compliance with a licensing complaint settlement — said in May that some VMware licensing costs had climbed by as much as 1,500% since the acquisition.

Most recently, in June Broadcom said it would "streamline" its partner program for VMware resellers to help improve support — and that meant reducing the number of approved partners and removing an entire tier of resellers.

That meant some customers would have to find new resellers.

One survey last year found more than half of VMware customers were considering ditching the company after Broadcom's acquisition. As a result, a host of major industry players have stepped in with rival options, HPE, Pure Storage and NetApp.

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