Key Points

SAP SE announced on Tuesday that it will invest over €200 billion in Europe over the next decade to enhance its sovereign cloud service capabilities. This initiative aims to ensure customer data is stored within the EU to comply with regional data protection regulations such as the General Data Protection Regulation (GDPR). Currently, countries worldwide are increasingly prioritizing the "localization" of computing infrastructure needed to train and operate high-performance artificial intelligence systems, and SAP's investment aligns with this trend.

German software giant SAP SE announced on Tuesday that it will invest over €200 billion (approximately $233 billion) in Europe over the next 10 years to enhance its sovereign cloud service capabilities.

The company stated it will expand its sovereign cloud services by adding an Infrastructure as a Service (IaaS) platform. Through this platform, enterprises can access various computing services using SAP's data center network. Currently, the IaaS market is primarily dominated by companies such as Microsoft and Amazon.

Additionally, SAP will launch a new "on-premises solution" where customers can use SAP-operated infrastructure within their own data centers.

The core objective of this initiative is to ensure customer data is stored within the EU, thereby complying with regional data protection laws such as the General Data Protection Regulation (GDPR).

"Innovation and sovereignty are not isolated concepts; they must complement each other," said Thomas Saueressig, Board Member responsible for SAP's Customer Services & Delivery business, during Tuesday's online press conference.

He added that for European companies, accessing cutting-edge technological advances such as artificial intelligence in a "completely autonomous and controllable environment" is of critical importance.

Over the past year or so, "technological sovereignty" has gradually become a hot topic. Due to escalating geopolitical tensions, companies have been forced to reassess their dependence on foreign technologies.

Currently, countries worldwide are increasingly promoting the "localization" of computing infrastructure needed to train and operate high-performance artificial intelligence systems. This trend has prompted global tech giants such as Amazon and Microsoft to announce new sovereign cloud initiatives to ensure European users' data is stored within the EU.

As the executive body of the EU, the European Commission has made artificial intelligence one of the EU's top priorities, aiming to strengthen its competitive position against the United States and China. Europe has long lagged behind these two countries in the overall technology sector.

Earlier this year, the European Commission announced a plan to invest €200 billion in building new "AI gigafactories." These facilities will be equipped with large supercomputers for developing next-generation artificial intelligence models.

Saueressig stated that SAP SE is "deeply involved" in the construction of these new AI gigafactories, but will not be the lead partner in the program.

He also noted that the company's investment of over €200 billion in European sovereign cloud service capabilities will not change its capital expenditure plans for next year, and this investment has already been incorporated into its financial planning.