Microsoft is expanding the capabilities of its Azure Local on-premises offering.
In a blog post penned by Microsoft’s president and CTO of Microsoft Specialized Clouds, Douglas Phillips, the company has revealed that Azure Local can now be scaled to support hundreds of servers, and has a new sovereign AI capability through a partnership with Nvidia.
Meanwhile, Amazon Web Services (AWS) has detailed its AWS European Sovereign Cloud that was established earlier this year.
– Sebastian Moss
Azure Local sees Microsoft hardware and software deployed at “distributed locations,” enabling customers to access the cloud while maintaining control and ownership of their environment.
Previously, Azure Local could support clusters of up to 16 physical servers. Now, Phillips wrote, it can “support hundreds of servers, opening new possibilities for organizations with large-scale or growing sovereign private cloud demands.
He added: “This enhancement means customers can support bigger, more complex workloads, scale their infrastructure with ease, and respond to evolving business needs all while aligning with the security and sovereignty required by European and global regulations.”
Part of this expansion includes the addition of Storage Area Network support for Azure Local, which enables customers to connect on-prem storage solutions to Azure Local.
On the sovereign AI side, Microsoft is bringing the Nvidia RTX Pro 6000 Blackwell Server Edition GPU to Azure Local.
According to Phillips, this enables customers to “accelerate their AI initiatives directly within a sovereign private cloud environment, ” while “helping ensure data protection and compliance.”
Microsoft is, in efforts to further secure its sovereign options, also planning to roll out the general availability of “disconnected operations.” Available from early 2026, this will enable customers to operate “private cloud environments with a completely on-premises control plane, enabling organizations to operate securely and independently within their own dedicated environments.”
The sovereignty developments follow earlier commitments from the company in June 2025, at that time announcing plans for a Sovereign Public Cloud, and a data guardian for European operations.
Azure Local was previously touted as a solution for Microsoft’s ongoing dispute with CISPE, but, in July, the two concluded that the offering didn’t meet the requirements needed to satisfy the agreement. Microsoft has since offered an alternative solution to CISPE, receiving a “green” rating in the latest status report.
Other US hyperscalers are also making steps to solidify their sovereign offerings. In June 2025, Amazon Web Services established the AWS European Sovereign Cloud as an independent entity.
In a recent whitepaper, AWS laid out the key elements of its sovereign offering.
According to AWS, access to AWS systems in the sovereign cloud offering is restricted to “qualified AWS European Sovereign Cloud Staff located within the EU,” as are customer support services. The cloud operates independently of the global AWS systems, which means it wouldn’t be impacted by outages experienced in the rest of AWS’ cloud network, and customers need separate accounts if they wish to use both services.
The whitepaper states: “Sovereign Cloud will have dedicated networking infrastructure and connectivity from European providers, in addition to sovereign points of presence for direct network connection to the AWS European Sovereign Cloud through AWS Direct Connect, providing customers an autonomous connection to the AWS European Sovereign Cloud. The AWS European Sovereign Cloud will have its own dedicated Amazon Route 53 routing.”
The only data that may leave the EU is internal system metrics, such as capacity management, performance monitoring, etc.
A big question surrounding US hyperscalers’ “sovereign” offerings pertains to the US CLOUD Act, which requires US companies to give the US government access to data in certain circumstances. On this, AWS notes that its staff are subject to EU law, and those sovereign staff will be included in the chain of review and approval for any law enforcement requests.
The whitepaper added: “AWS reviews every law enforcement request individually and independently. AWS commits to use every reasonable effort to redirect any governmental body requesting AWS European Sovereign Cloudrestricted data to the applicable customer; promptly notify the applicable customer about the AWS European Sovereign Cloud-restricted data request, and if AWS is prohibited from notifying a customer about the request, AWS will use all legally valid efforts to obtain a waiver of prohibition to allow AWS to communicate as much information as possible to the customer, and use all legally valid efforts to challenge any request that conflicts with the law of the European Union or applicable Member State law.”
The whitepaper further adds: “Since we began reporting the statistic in July 2020, no law enforcement request has resulted in the disclosure to the United States government of AWS enterprise or government content data stored outside the United States.”
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