The "sovereign cloud" narrative went through two phases: first political ideology, then pragmatic engineering. By mid-2026 the conversation shifted: no longer "AWS is evil", but "AWS for what, and which European provider for what".
Market state
The three US hyperscalers — AWS, Azure, Google Cloud — still hold 70%+ of the European market. But European providers grew: Hetzner added data centers, OVH consolidated managed services, Aruba invested in EU-wide zones, Stackit (Schwarz Group) and IONOS opened new regions.
The point: for 70% of Italian SME workloads, a European provider is technically on par. The remaining 30% are very specific (ML training at scale, advanced AWS managed services) where AWS/GCP stay irreplaceable.
When European makes sense
Sensitive data under strengthened GDPR
Healthcare, public sector, minors' data. US Cloud Act + Schrems II/III rulings make storing EU personal data on US-controlled infrastructure risky, even if physically in Europe. Hetzner or Aruba eliminate the whole risk category.
Predictable cost
Hetzner cloud: 50-70% cheaper than AWS for equivalent CPU/RAM. For a standard web app with DB, cache, queue, annual TCO changes by thousands of euros. Over 5 years the delta pays a salary.
Egress fees
OVH and Hetzner offer generous data transfer (terabytes included). AWS bills every outbound GB. For CMS, asset serving, streaming, the gap is huge.
When AWS/GCP remain the pick
- ML/AI workloads at scale: no European provider matches Bedrock or Vertex AI maturity.
- Advanced managed services: DynamoDB, BigQuery, Lambda with complex triggers. European equivalents exist but lag.
- Global multi-region: if you serve US/APAC users, hyperscalers stay unbeatable.
What we learned across projects
Hybrid setups are the 2026 reality. Hetzner for the core (web app, Postgres, Redis, queue). AWS only where needed: S3 + CloudFront for global assets, Bedrock for AI features, SES for transactional email.
The full AWS lock-in many Italian SMEs had in 2022-2023 is winding down. Not for ideology: for cost, data control, predictability.
Verdict
Sovereign cloud in 2026 is not a flag. It's an engineering decision that, for most of our SME projects, pays in TCO and reduces regulatory risk. The best choice is rarely "all European" or "all AWS": it's "the right piece on the right provider".