European organizations are increasingly adopting cloud technologies, with 80% reporting medium or high cloud maturity as of 2025, according to PwC’s latest research. This growth is coupled with a planned increase in cloud budgets by 86% of respondents over the next year.
However, the cloud landscape is undergoing a significant shift driven by geopolitical factors and evolving regulatory demands. Governments are increasingly mandating data localization and “sovereignty-by-design” models, prompting organizations to complement global cloud platforms with regional or national solutions.
The emergence of sovereign cloud platforms is leading to a hybrid approach, where these platforms operate alongside public cloud deployments to address specific use cases, even if it means accepting trade-offs in service range or cost. Olivera Majdandzic, a Partner at PwC France & Maghreb specializing in Cloud Transformation, emphasized that “digital sovereignty is not just a regulatory requirement; it’s a strategic advantage.” She added that PwC’s focus is on “designing hybrid and sovereign architectures that balance trust, performance and innovation — enabling organisations to navigate complex environments without ever compromising their agility.”
This trend is reflected in organizational plans for cloud architecture adjustments. PwC’s research indicates that 94% of organizations intend to modify their cloud architecture in the coming year, often by incorporating multi-cloud capabilities or integrating sovereign solutions for specific data types or workloads. Enterprises are strategically migrating sensitive or regulated data to sovereign environments while maintaining other operations in public or private clouds.
Managing this complexity requires unified cloud management and governance to ensure visibility, consistency, and control across all platforms. The ability to seamlessly move workloads between public, sovereign, and private clouds is becoming crucial for maintaining agility and responding to regulatory changes, optimizing costs, and leveraging the unique strengths of each environment.
The cloud’s inherent adaptability is well-suited to meet sovereignty requirements, and CIOs are recognizing the potential for innovation beyond mere compliance. Sebastian Paas, EMEA Cloud Transformation Leader at PwC Germany, stated, “The cloud was built for change – and today, that purpose matters more than ever. It empowers organisations to respond to disruption, scale innovation and build the resilience needed to thrive in a shifting landscape.”
PwC’s data reveals a shift away from reliance on single cloud environments. Just 18% of businesses currently operate with a single cloud provider, a model associated with lower maturity and slower progress in areas like artificial intelligence and FinOps. Conversely, four out of five enterprises are now employing a multi-cloud strategy to maximize innovation potential and secure the most cost-effective services from various cloud vendors.
A new ecosystem of partnerships is emerging to support this evolving landscape. Hyperscalers are developing new sovereign solutions and expanding their presence in local regions, while regional and national providers are strengthening local trust. This competition and investment are providing clients with increased flexibility, multi-cloud options, and a wider range of partnership approaches.
