The Datacom 2025 ANZ Cloud and Infrastructure Report reveals a marked escalation in concerns surrounding data sovereignty among organisations across Australia and New Zealand. These concerns are primarily driven by security, regulatory compliance, and the rapidly intensifying computational demands of artificial intelligence (AI).
61% of respondents in New Zealand and 60% of respondents in Australia are concerned about data sovereignty.
There is a clear intent among organisations to localise their data processing to mitigate risks and maintain privacy and security. The higher preference is suggested to be intensified by ongoing global uncertainty.
61% of New Zealand organisations and 68% of Australian organisations show a greater preference for local data processing.
The requirements of AI workloads are accelerating the demand for high-performance, low-latency infrastructure. These considerations, along with data protection and regulatory requirements, are intensifying the focus on data sovereignty and local infrastructure investment, impacting platform decisions and workload strategies. This is complicated by perceived infrastructure capacity limitations related to AI demands.
55% of New Zealand respondents and 56% of Australian respondents believe their country’s existing infrastructure lacks the capacity to support the large-scale compute and storage demands that AI will bring.
The emphasis on sovereignty and local control extends to how organisations select technology partners:
- Respondents expressed a desire for technology partners to be subject to the same legislation as their business
- For the first time since the report began, “locally available staff” was identified as one of the top criteria for technology partners, underscoring the increasing focus on local capabilities.
In conclusion, Datacom’s 2025 ANZ Cloud and Infrastructure Report underscores that data sovereignty has become a defining priority for organisations in both Australia and New Zealand. Concerns around security, compliance, and AI-driven infrastructure demands are reshaping how businesses approach technology and governance.
The findings reveal that sovereignty is no longer a purely policy issue, that it is an operational imperative. Organisations are increasingly seeking technology partners bound by local laws and supported by locally based staff, aligning digital infrastructure choices with national interests and community trust.