Tech Giants Boost Sovereign AI Investment to Strengthen Localized Data Control
Tech giants are increasingly prioritizing sovereign AI investment, as they intend to boost the competitiveness to develop local infrastructure. Data sovereignty is the new term which means that the data generated in a particular country or continent should stay within the borders. It also emphasizes that the laws of that particular country are applicable to the data generated.
Chris Gow, IT networking giant Cisco’s Brussels-based EU public policy lead, told CNBC, “Sovereign AI is a relatively new term that’s emerged in the last year or so.” This growing trend is a result of concerns about data privacy and security intensifying globally.
Large language models, like OpenAI’s ChatGPT and Anthropic’s Claude, store data in U.S.-based data centers and process requests via clouds, which has raised concerns in Europe.
Concerns About U.S. Data Dependency in Europe
Europe is concerned about its dependency on U.S.-based technology. Politicians and regulators are raising concerns that this dependence could harm Europe’s competitiveness and technological resilience. This has made the region create new regulations that aim at making sure that businesses comply with data sovereignty laws.
The European Union’s General Data Protection Regulation (GDPR) plays an important role in enforcing data privacy standards It requires businesses to use data in a secure and compliant manner to maintain the user’s right to privacy. It ensures that users’ privacy rights are protected.
In 2020, the European Court of Justice ruled that the EU-U.S. data-sharing framework did not offer the same level of protection as guaranteed by GDPR. However, the pact was updated last year to ease data flow between the EU and the U.S., which has led to the localization of cloud infrastructure.
Rising Demand for Localized Cloud Infrastructure
Filippo Sanesi, global head of marketing and operations at OVHCloud, said their firm is seeing a rise in the demand for its European located infrastructure as they “understand the value of having their data in Europe, which are subject to European legislation.”
Sanesi stated, “As this concept of data sovereignty becomes more mature and people understand what it means, we see more and more companies understanding the importance of having your data locally and under a specific jurisdiction and governance. We have a lot of data. This data is sovereign in specific countries, under specific regulations.”
According to Chris Gow, the push for sovereign AI is not just coming from politicians or regulators, but from private companies that are increasingly open to enabling cloud-based AI tools to process more data locally. This reflects a broader shift towards ensuring data sovereignty and aligning AI with local regulations.
Japan and Italy Adapt Sovereign AI Investment
Sovereign AI is not only a trend in Europe and the U.S. Countries like Japan and Italy are also adapting sovereign AI investment to strengthen domestic technology. Japan is developing AI models that are rooted in its culture and language to focus on sectors like healthcare and finance. Japan is collaborating with Nvidia’s AI chips to develop apps for high-stake industries, such as healthcare and security.
Similarly, Italy launched Italia 9B this summer, a large language model trained specifically in Italian. Italia 9B aims to ensure that data generated by Italian citizens stays within the country’s borders, aligning with local cultural and legal frameworks.
David Hogan, EMEA head of enterprise sales at Nvidia, stated, “Sovereign AI is about reflecting the values of an organization or, equally, the country that you’re in and the values and the language.”
