In Pure Storage's 2025 research with the University of Technology Sydney, 100% of industry leaders said data sovereignty is forcing them to reconsider where their data lives. But almost none will talk about it on the record.
"Data sovereignty has just become the hottest topic that, in a funny way, almost nobody is talking about," admits Patrick Smith, Field CTO at Pure Storage.
75% of European enterprises depend on US cloud platforms. 82% don't want to. That gap isn't indecision. It's paralysis.
The Tightrope
AWS, Azure, and Google control 70% of the EU cloud market. They invest €10 billion per quarter in European infrastructure. EU providers cannot yet match the AI services, managed databases, and platform capabilities.
But the CLOUD Act grants US authorities access to data regardless of where it sits. When Microsoft's legal director told the French Parliament in June 2025 that the company "cannot guarantee" EU data protection from US government access, the admission confirmed what most already suspected.
"The EU has to walk a tightrope," Smith explains, "because regulation holds organizations back, makes them less competitive on the world stage."
Two Paths, Two Losses
Path 1: Do Nothing. Keep hyperscalers. Accept CLOUD Act exposure. Risk eroding customer trust.
Path 2: Go Full Sovereign. Move to OVHcloud or Hetzner. True EU jurisdiction, and yes, cheaper raw infrastructure. But the savings disappear when you factor in rebuilding the capabilities you lose: managed AI services, platform tools, custom engineering to replace what hyperscalers provide out of the box. "This is not an ROI place," Smith notes. You're buying risk mitigation, not returns. For some workloads like public sector and critical infrastructure, this is exactly the right call. For most commercial enterprises, it's a hard trade.
Most enterprises assume the choice is binary: sovereignty or competitiveness. Pick your loss.
But the binary itself is wrong.
The Third Path
The mistake is treating all data the same. In most enterprises we work with, only about a third of data actually triggers sovereignty obligations: customer PII, regulated workloads, competitive IP. The other 70% can stay exactly where it is.
The architecture that enables this hybrid approach needs three properties:
- Non-custody storage: You generate and hold the encryption keys. The provider never possesses plaintext data and therefore cannot produce it, even under legal compulsion.
- Zero egress fees: Moving data between sovereign and non-sovereign tiers can't incur penalties, or the economics break.
- S3 compatibility: Redirect buckets, don't rewrite applications.
This pattern (self-hosted gateway, customer-held keys, decentralized backend) provides what we call technical sovereignty: only you can decrypt your data. A provider can hand over encrypted objects if required, but it cannot produce plaintext content it never controls.
Akave implements this pattern end-to-end. Full disclosure: we're incorporated in Delaware. Same jurisdiction as the hyperscalers. But with Akave O3, our self-hosted S3-compatible gateway, you run the gateway on your EU infrastructure. You generate the encryption keys locally. We provide the protocol and decentralized storage network, but we never hold readable data. Even if a US court ordered us to hand over your files, we could only provide encrypted objects. We cannot decrypt or access your data. The architecture enforces that, not just policy.
We don't ask for blind trust. The gateway code is open for inspection. Verify the implementation yourself.
In McKinsey's "The State of Cloud Computing in Europe" (2025), they documented a large European multinational using this hybrid approach: €20 million in annual savings by combining sovereign storage for sensitive workloads with hyperscaler services for everything else. Sovereignty and efficiency. Not either/or.
What the Hybrid Actually Costs
That McKinsey case is a billion-dollar transformation. What about a more typical workload?
Here's a mid-size example: 100TB total, 30TB sensitive (on sovereign storage), 70TB non-sensitive (stays on hyperscaler).
.png)
The "Pure Sovereign" figure includes the hidden cost: rebuilding managed services, engineering overhead, and capability gaps. Not just storage fees. Raw EU infrastructure is cheap. Replacing what you lose isn't.
Hybrid costs 14% less than hyperscaler-only. 55% less than pure sovereign. And achieves both objectives.
Assumptions: 100TB active data, standard access patterns, Q4 2025 list pricing.
Classify Before You Migrate
Stop asking "which cloud provider?" Start asking "which data actually requires protection?"
For most enterprises, it's not a full migration. It's a classification exercise. Identify the 20-30% that carries real risk. Put that on infrastructure where you hold the keys. Leave everything else where it is.
Akave O3 runs at $14.99/TB with zero egress fees and full S3 compatibility. Run the numbers on your own data estate and see what a sovereign split does to your bill.
Connect with Us
Akave Cloud is an enterprise-grade, distributed and scalable object storage designed for large-scale datasets in AI, analytics, and enterprise pipelines. It offers S3 object compatibility, cryptographic verifiability, immutable audit trails, and SDKs for agentic agents; all with zero egress fees and no vendor lock-in saving up to 80% on storage costs vs. hyperscalers.
Akave Cloud works with a wide ecosystem of partners operating hundreds of petabytes of capacity, enabling deployments across multiple countries and powering sovereign data infrastructure. The stack is also pre-qualified with key enterprise apps such as Snowflake and others.