Cloud deployment and geopolitical risk

Organisations must assess how dependent they are on cloud services beyond their home country. By Lydia Leong

- Lydia Leong

Recent geopolitical events have made the global IT infrastructure landscape more volatile, uncertain, complex and ambiguous than ever before.

In this climate of instability, organisations have become increasingly concerned about cross-border technology dependency, driving them to reevaluate their reliance on cloud providers.

For years, organisations faced more familiar concerns, such as vendor lock-in, loss of vendor negotiation power and the possibility of a major outage, such as what happened with the Crowdstrike crash that knocked out airline IT systems globally last year. These are challenges, but are largely viewed as manageable trade-offs for the innovation, agility and efficiencies of scale that cloud offers. As a result, Gartner research shows cloud sovereignty was previously a low priority for customers. This is no longer the case.

While much of the modern IT ecosystem relies on cloud providers, the risks posed by geopolitical turbulence now extend far beyond loss of service from sanctions or trade disputes, to the potential for data theft through government seizure or extralegal actions.

There are also concerns about unpredictable cloud costs driven by tariffs, inflation and currency fluctuations. All of this is forcing cloud strategy back into the boardroom as a critical business resilience issue.

Many traditional hardware and software offerings are now licensed via the cloud, creating hidden points of reliance that could become critical.