Table of Contents
What Is Behind SAP Sovereign Cloud On-Site?
SAP has announced that its on-site variant will enable the cloud infrastructure to be physically operated at the customer’s premises or in a data center specified by the customer. The key feature is that SAP will continue to handle operation and maintenance in accordance with clearly defined standards. This is intended to address key aspects of sovereignty:
- Data sovereignty: The organization decides where its data is stored.
- Operational sovereignty: Access, maintenance, and logging are carried out according to transparent rules.
- Technical sovereignty: The focus is on open standards and control over the components used.
- Legal sovereignty: Compliance with national laws, compliance requirements, and auditability are guaranteed.
SAP is underlining this commitment with a planned investment of around €20 billion in its entire sovereign cloud portfolio, as reported by Heise, among others. In addition to the on-site variant, this also includes region-specific offerings and the expansion of European infrastructure.
However, SAP Sovereign Cloud On-Site is not yet available. The first rollout is expected at the end of 2026 at the earliest.
Open Questions and Challenges
The exact requirements, certifications, and restrictions are also still unclear at this time. For example, it remains to be seen
- whether SAP will restrict use to certain industries,
- what requirements will be placed on data centers (e.g., certifications or audits),
- and what contractual framework conditions will apply.
Lock-In: Sovereignty, but with Limits
SAP emphasizes that data remains with the customer, who retains control over their infrastructure. This is true in physical, logical, and operational terms, but customers remain dependent on SAP:
- The entire software environment (S/4HANA Cloud Stack) is proprietary.
- Operation, updates, and security patches are carried out exclusively via SAP mechanisms.
- Without an active contract, the customer receives no maintenance or upgrades, which can technically restrict operations.
- Even if the hardware is located at the customer’s site, central components (e.g., kernel, license server, cloud services) are tied to SAP.
This means: location sovereignty yes – full operational or migration sovereignty no.
The issue of data sovereignty also remains complex. Formally, the data belongs to the customer, but access and usability depend on the technical and contractual arrangements. At the end of the contract or upon termination, data export can be difficult or costly, for example due to proprietary formats and complex dependencies.
Who Would Benefit from the On-Site Option?
The new option is generally of interest to organizations that
- are subject to strict regulatory requirements,
- require hybrid operating models,
- and want to leverage innovations such as AI or platform modernization without compromising data protection or compliance.
However, at present, much of this is still theoretical.
Until it is actually available, it remains to be seen how SAP will shape the framework conditions and which customers will be able to participate.
What Does this Mean for Companies – And How Can We Help?
SAP Sovereign Cloud On-Site is a promising concept, but it is not yet feasible in practice. Many technical, organizational, and legal aspects remain unresolved.
At in4MD Service GmbH, we are closely following developments and are already available for strategic dialogue on SAP Sovereign Cloud offerings:
We support you …
- in evaluating existing SAP cloud offerings,
- in further developing your cloud strategy,
- and in looking ahead to set the right course for future operating models at an early stage.
If you are wondering how to prepare for upcoming options such as SAP Sovereign Cloud On-Site or how to future-proof your existing SAP infrastructure, please feel free to contact us.
Conclusion
With SAP Sovereign Cloud On-Site, SAP is taking an important step toward reconciling cloud innovation and sovereignty.
The idea of operating cloud services in your own or selected data center while still benefiting from SAP’s expertise and service offers great potential, especially for industries with high security and control requirements.
However, implementation is still in its infancy.
Many operational, technical, and legal questions remain unanswered. Companies should closely monitor developments, regularly review their cloud strategy, and define their own requirements at an early stage.
