European cloud providers offer GDPR-compliant hosting and infrastructure services as alternatives to AWS, Azure, and Google Cloud. Team.BLUE (Belgium, $5.1B valuation) connects businesses across 15 European countries, OVHcloud (France) is Europe's largest cloud provider, and Hetzner (Germany) provides cost-competitive infrastructure hosting.
The demand driver is regulatory: GDPR, the Schrems II ruling (invalidating US-EU data transfer frameworks), and sector-specific regulations (banking, healthcare) create markets where European companies must store and process data within EU jurisdiction, under EU legal frameworks, using providers subject to EU law rather than US CLOUD Act.
The technology gap with US hyperscalers is acknowledged: European cloud providers cannot match AWS or Azure's breadth of services or global scale. The competitive strategy is sovereignty and compliance — offering infrastructure where the customer retains legal and technical control of their data, with no risk of foreign government access. For regulated industries (banking, healthcare, defense, public sector), this sovereignty premium outweighs the feature gap.