Pure Storage has released new insights on data sovereignty in collaboration with the University of Technology Sydney (UTS). The analysis reveals how geopolitical uncertainty and regulatory evolution are transforming data sovereignty from a compliance issue into a fundamental business risk affecting competitiveness, innovation, and customer trust.
A qualitative pulse-survey of industry leaders across nine countries revealed unanimous concern about the risks of inaction around data sovereignty:
- 100% confirmed sovereignty risks, including potential service disruption, have forced organisations to reconsider where data is located
- 92% said geopolitical shifts are increasing sovereignty risks
- 92% warned inadequate sovereignty planning could lead to reputational damage
- 85% identified loss of customer trust as the ultimate consequence of inaction
- 78% are already embracing different data strategies, such as implementing multi service provider strategies; adopting sovereign data centres; and embedding enhanced governance requirements in commercial agreements
The survey identifies a “perfect storm” where service disruption risks, foreign influence concerns, and evolving regulations converge to create unprecedented exposure for businesses and nations. Organisations now face potential revenue loss, regulatory penalties, and irreparable damage to stakeholder trust if these risks are not proactively addressed.
Navigating data sovereignty risk
The solution to the sovereignty challenge is not a binary choice between detaching from all public cloud services or an outright disregard for all risks associated with data sovereignty. Pure Storage recommends a more intentional assessment of organisations’ strategic objectives. This requires a proactive and a thoughtful process that analyses the risk landscape to identify which services and data sets are most critical and sensitive, place these workloads in sovereign environments, while leveraging public cloud for less crucial functions. This balanced approach enables organisations to maintain compliance and control without sacrificing the innovation and agility that organisations need in order to remain relevant in today’s fast-paced business environment.
“The potential consequences of not having a modern and realistic data sovereignty strategy are acute. Loss of trust, financial damage and competitive disadvantage are possible outcomes that cannot be ignored. We recommend a hybrid approach to data sovereignty: start with a risk assessment across workloads, keep critical workloads sovereign, and use the public cloud for the rest. A balanced strategy optimises reducing risk while maintaining speed of innovation and organisational resilience,” said Alex McMullan, Chief Technology Officer, International, Pure Storage.
The position brief emphasises that successful navigation requires strategic risk assessment, hybrid approaches that combine sovereignty with innovation, and proactive preparation for regulatory evolution. Organisations taking action now position themselves for competitive advantage as sovereignty requirements expand globally.
“These are wake-up call numbers. Every single leader we interviewed is rethinking data location. The message is clear: sovereignty is no longer optional, it is existential,” said Gordon Noble, Research Director at UTS’s Institute of Sustainable Futures.
“Data sovereignty has evolved from a technical challenge to a critical business issue. Organisations that don’t address where their most important data and services are located risk service disruption, regulatory non-compliance, and reputational damage. We expect to see data sovereignty treated as a strategic priority in 2025 and beyond, to safeguard long-term business continuity and trust. Organisations that focus on pragmatic strategies to enhance data resilience, control and strategic autonomy can minimise dependencies, risks and exposures,” said Archana Venkatraman, Senior Research Director, Cloud Data Management, IDC Europe.
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