European cloud group invests to create what it dubs “Trump-proof cloud services”

But analysts have questioned whether the Microsoft move truly addresses those European business concerns. Phil Brunkard, executive counselor at Info-Tech Research Group UK, said, commenting on last month’s announcement of the EU Data Boundary for the Microsoft Cloud,  “Microsoft says that customer data will remain stored and processed in the EU and EFTA, but doesn’t guarantee true data sovereignty.”

And European companies are now rethinking what data sovereignty means to them. They are moving beyond having it refer to where the data sits to focusing on which vendors control it, and who controls them.

Responding to the new Euro cloud plan, another analyst, IDC VP Dave McCarthy, saw the effort as “signaling a growing European push for data control and independence.”

“US providers could face tougher competition from EU companies that leverage this tech to offer sovereignty-friendly alternatives. Although €1 million isn’t a game-changer on its own, it’s a clear sign Europe wants to build its own cloud ecosystem—potentially at the expense of US market share,” McCarthy said. “For US providers, this could mean investing in more EU-based data centers or reconfiguring systems to ensure European customers’ data stays within the region. This isn’t just a compliance checkbox. It’s a shift that could hike operational costs and complexity, especially for companies used to running centralized setups.”

Adding to the potential bad news for US hyperscalers, McCarthy said that there was little reason to believe that this trend would be limited to Europe.

“If Europe pulls this off, other regions might take note and push for similar sovereignty rules. US providers could find themselves adapting to a patchwork of regulations worldwide, forcing a rethink of their global strategies,” McCarthy said. “This isn’t just a European headache, it’s a preview of what could become a broader challenge.”