In light of growing geopolitical uncertainty, software company SAP has announced investments worth billions to strengthen its cloud offering in Europe and thus create a counterweight to the US giants in the industry. “With a long-term investment of over €20 billion, SAP is placing a clear strategic focus on digital sovereignty,” SAP announced on Tuesday. In addition, cloud offerings for Europe are to be expanded “as a basis for AI innovations.”
The “sovereign cloud” means that “all data” remains in the European Union, emphasized SAP manager Martin Merz, who is responsible for the Sovereign Cloud business unit at the Walldorf-based company. This ensures both data protection and compliance with European regulations, he said in a conference call.
According to the company, several solutions will be offered: an infrastructure in SAP's data centers in Europe and an option that is installed directly at the customer's site to ensure maximum sovereignty. The key point is that everything will be operated entirely by SAP, “from infrastructure automation to software and platform management,” explained board member Thomas Saueressig.
According to Merz, one of the first customers is the defense contractor Hensoldt, which specializes in electronic equipment for the defense sector. Given the massive investments in the cloud sector by US technology giants such as Amazon, Microsoft, and Google, “we can't wait five years,” Saueressig added, referring to the “important issue” of cybersecurity and Europe's “digital lag.”
In 2024, SAP had already announced investments of two billion euros to strengthen its capabilities in the field of artificial intelligence (AI). Last year, the group generated revenue of more than 34 billion euros and employed around 110,000 people. SAP is valued at over 285 billion euros on the Frankfurt Stock Exchange, more than any other German company.
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