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TechnologyJul 10, 2026· 3 min read

Kyndryl Expands Sovereign Cloud Services with Microsoft

Kyndryl Expands Sovereign Cloud Services with Microsoft

Kyndryl broadens its offering for digital sovereignty through new services developed in collaboration with Microsoft. The goal is to help businesses and public administrations design and manage cloud infrastructures that comply with data residency requirements, access control, and operational autonomy.

The proposal covers both public cloud environments based on Microsoft Azure and Microsoft 365, as well as private cloud configurations built on Azure Local. The latter can operate in connected or disconnected mode, depending on the security and control constraints imposed by the organization.

Kyndryl will handle the initial assessment, architecture definition, implementation, and subsequent operational management of the environments.

From Regulatory Compliance to IT Architecture

Digital sovereignty is not just about the physical location where data is stored. It also encompasses applicable jurisdiction, control over activities, access governance, and the ability to verify who manages the infrastructure. This is of utmost importance for public administrations, financial companies, and more generally entities managing critical systems. These organizations are required to translate regulations like GDPR, DORA, and NIS2 into applicable technical and organizational measures for IT environments.

To support businesses in this transition, Kyndryl offers a Sovereignty Readiness Assessment service that evaluates the company's maturity level, identifies gaps and technological dependencies, and defines a roadmap for adopting sovereign infrastructures. The analysis may cover data localization, administrator identity, operational procedures, contractual constraints, and dependencies on external suppliers or platforms.

The architectures can utilize the capabilities of Microsoft Sovereign Cloud in the public cloud or be implemented on private infrastructures based on Azure Local. The second option allows Azure services to be executed within the customer’s data centers or in facilities controlled by local operators. Disconnected configurations are intended for environments that cannot rely on a continuous connection to the public cloud, such as certain government, industrial, or defense-related infrastructures.

Kyndryl also plans to integrate Microsoft technologies with private clouds, regional providers, and existing on-premises systems. The setup is therefore hybrid and does not necessarily require the transfer of all workloads to a single platform. The model should enable organizations to maintain some systems in existing environments, moving only applications and data that are compatible with regulatory and operational requirements to the cloud.

Sovereignty Also Relates to Data and AI Models

The offering also includes AI-based workloads. In this case, sovereignty requirements must be applied not only to the data used by applications but also to the models, training procedures, and services employed for inference. For more sensitive systems, it may be necessary to ensure that data and models remain within a certain geographical area or infrastructure, while simultaneously limiting access by operators subject to different jurisdictions.

"Kyndryl deeply understands the challenges related to sovereignty thanks to our experience gained through direct dialogue with governments and European institutions. Our strategic alliance with Microsoft combines complementary skills to help clients transform sovereignty into a tangible and operational element of their IT architectures, with a practical and scalable approach," says Giovanni Carraro, Global Strategic Alliances Leader at Kyndryl. "By collaborating with Microsoft, we are able to support clients in aligning their sovereignty goals with tangible architectural solutions, balancing control, resilience, and performance in hybrid and distributed environments."

"Kyndryl's established experience in designing and managing complex and highly regulated environments combines with Microsoft's Sovereign Cloud capabilities, including solutions designed to meet data residency, access governance, and regulatory compliance requirements," states Ihab Foudeh, EMEA Enterprise Partner Solutions General Manager at Microsoft. "Through this collaboration, we support organizations in adopting the cloud while respecting local regulations, while simultaneously accelerating infrastructure modernization and digital innovation paths."