Europe's cloud datacenter ambition 'completely crazy' says SAP CEO
- Reference: 1749479292
- News link: https://www.theregister.co.uk/2025/06/09/europes_cloud_datacenter_ambition/
- Source link:
A year ago [we] would not have thought about these kind of geopolitical conflicts we are having now
Speaking at an investment conference last week, SAP CEO Christian Klein said the business application company had [2]struck deals with French AI company Mistral and business services company Capgemini to support customer concerned about data sovereignty in Europe, but saw no point in replicating the effort at cloud-infrastructure level.
"A year ago [we] would not have thought about these kind of geopolitical conflicts we are having now," he said.
With AI and its data storage, SAP offers concerned customers "complete sovereignty from the top to the bottom," he said.
However, he warned about attempts to replicate the services of the large US cloud providers, which claim to offer data sovereignty in Europe. In recent weeks, [3]Microsoft , [4]Google and most recently [5]AWS have all made similar noises about being safe data havens for European customers [6]worried about the policies and rhetoric coming out of the White House.
[7]
"The only thing I would caution against in Europe is this: the competitiveness of Europe's car industry or chemical industry will not be by building 20 different datacenters in France and try[ing] to compete against the US hyperscalers. It's completely crazy, and that is sovereignty completely done in the wrong way. We need the best here in Europe to apply AI, to apply intelligent software to do be the best to produce much better, much faster, better cars, and be way more efficient running our supply chains," he said.
[8]
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Klein said there was huge pressure on energy prices in Europe, so [10]building more datacenters was not a good solution. SAP could give customers different levels of data security and data sovereignty but was "super agnostic on the infrastructure layer," he told a conference hosted by investment bank BNP Paribas.
Against a backdrop of increasingly hostile US rhetoric against European politics and norms of governance, European leaders yesterday announced an [11]International Digital Strategy designed to help the bloc address technological change at a time of global political realignment.
[12]European pols wave their hands about digital sovereignty with broad but vague plan
[13]'Close to impossible' for Europe to escape clutches of US hyperscalers
[14]AWS forms EU-based cloud unit as customers fret about Trump 2.0
[15]Under Trump 2.0, Europe's dependence on US clouds back under the spotlight
While US cloud hyperscalers AWS, Google, and Microsoft try to calm concerns about data sovereignty, some European politicians remain concerned about the US administration's willingness to ignore court orders.
SAP is not alone in questioning whether it is wise to seek separation at cloud infrastructure level. [16]Experts told The Register last month that it was "in practice close to impossible" for European organizations to replicate the infrastructure established by the big US cloud vendors in Europe.
[17]
SAP became Europe's highest valued company in March, amassing a market capitalization of around $342.4 billion.
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[1] https://www.cnbc.com/2025/03/25/sap-becomes-europes-most-valuable-firm-amid-german-stock-boom.html
[2] https://www.capgemini.com/news/press-releases/capgemini-mistral-ai-and-sap-combine-forces-to-offer-secure-scalable-gen-ai-powered-solutions-for-regulated-industries/
[3] https://www.theregister.com/2025/04/30/microsoft_getting_nervous_about_europes/
[4] https://www.theregister.com/2025/05/21/google_sovereign_cloud_updates/
[5] https://www.theregister.com/2025/06/03/aws_european_sovereign_cloud/
[6] https://www.theregister.com/2025/03/17/european_tech_sovereign_fund/
[7] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2aEcFEy5oSSuHI12hjzVSwQAAAhM&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[8] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44aEcFEy5oSSuHI12hjzVSwQAAAhM&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[9] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33aEcFEy5oSSuHI12hjzVSwQAAAhM&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[10] https://www.theregister.com/2025/04/12/ai_double_datacenter_energy/
[11] https://www.theregister.com/2025/06/06/europe_international_digital_strategy_nothingburger/
[12] https://www.theregister.com/2025/06/06/europe_international_digital_strategy_nothingburger/
[13] https://www.theregister.com/2025/05/22/ditching_us_clouds_for_local/
[14] https://www.theregister.com/2025/06/03/aws_european_sovereign_cloud/
[15] https://www.theregister.com/2025/02/26/europe_has_second_thoughts_about/
[16] https://www.theregister.com/2025/05/22/ditching_us_clouds_for_local/
[17] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44aEcFEy5oSSuHI12hjzVSwQAAAhM&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[18] https://whitepapers.theregister.com/
Re: Give them your keys?
He probably has a lot of US relationships - customers and suppliers - he needs to keep in with.
So let's raise the stakes a bit. Introduce legislation to enable European governments to take possession of any critical infrastructure in the event of a foreign government ordering its shutdown an emergency. The government wouldn't have to run the infrastructure itself, it would just become the owner to whom the local management would answer and would also assume ownership of the contracts.
If the sovereign arrangements are what they're cracked up to be it would never be invoked so it shouldn't affect Microsoft and the rest.
I think that the issue which he's conveniently ignoring is the complete change in the international trade landscape that has been initiated by Trump - and I see no reason to assume that it will change after he goes. The days of price and functionality governing choice of products with a bit of grey around some legal stuff has been blown out of the water by a president who's willing to weaponise anything he sees fit to get what the last person he spoke to told him he needs to do. This, and the craven billionaires trying to buy favour is reason enough to start divesting from US tech in vulnerable areas.
The odd thing about it is that the quote in the article shows that he does see it - and then ignores it.
"apply AI, to apply intelligent software"
CEO has no worthwhile opinion on the pressing IT issue of the day, uses opportunity to sell his snake oil.
> SAP offers concerned customers "complete sovereignty from the top to the bottom," he said.
Right. So, let's assume my data is physically hosted inside Europe, but by a US company. If I understand correctly, this is the situation he's suggesting.
Now, let's assume that I, as a EU company and/or citizen who does not particularly want to be subject to US laws and possibly does not even operate in the US, do not want my data to be handed over to the US government just because they asked.
Finally, let's assume the US company gets a Cloud Act order to hand over my data to the US government.
What exactly, dear SAP CEO, am I supposed to do in this scenario?
I'll tell you: first, hope really hard that my goverment and the US government have an agreement on what happens, and that said agreement involves them getting permission from my government. If they don't, then my data is gone.
Next, I have to hope really hard that the US government is actually respecting that agreement. If they don't, then my data is gone - but I might get redress in court, after a lot of time and a whole lot of money. But if the US government really feels like it, they'll find an excuse and I won't even get that. In fact, I might not even know that my data has been copied until long after the fact.
And when I do know, and raise hell, what's going to happen anyway? The damage is done. And I can't even drop them and go to an EU cloud provider - because we've decided we don't need them!
This is not what "complete sovereignty" looks like.
Your government, or you, won't have that opportunity if the Cloud Act request is delivered as a National Security Letter.
The data will simply be taken without anyone other than the recipient of the NSL knowing about it. You will never know about it happening.
Yeah, no "benefit" other than ensuring it complies with EU law, unlike the Americans who keep giving you the finger about the retention and privacy laws.
There is no point
There is no point in war - everyone ends up worse off. However, sometimes it is inevitable as the alternative is to end up worse off still.
Do we need more Hype?
My company has been using external servers/VMs for three decades which included one of the big three. In general we found the cost/value/performance was inversely related to the size of the provider. But then our needs are simple. We don't need the add-on they push.. Our favoured provider is an EU company and yes we have tried UK providers. We would again if they could match not just price but delivery and intelligent ticket response.
Lucky to be small? And also keeping systems simple. Every so often we (that's me) has to do a spring clean to remove the complexity that inevitably creeps in. Once it gets too complex simplifying back may become impossible. Which is why I feels for so many IT systems people here having to try and mange stuff that has just grown into a huge tangled mess. Moving some responsibility out (and paying dearly for it) is the only way they can get home at night.
Is that one reason why so many emergent companies can grow and become a great success before hitting a messy administrative ceiling before descending into an IT morass?
Give them your keys?
SAP is not alone in questioning whether it is wise to seek separation at cloud infrastructure level.
I'd say not separating from the US infrastructure puts us all at risk. Why the hell should Europe be dependent on US firms for critical infrastructure ? Haven't these people learned from history?