How Europe’s AI Investments Are Held Back by Billions in Annual Cloud Waste

European companies are entering the AI era at a built-in disadvantage. A new report from IT firm Insight reveals that businesses waste, on average, 24 percent of their annual cloud capacity—funds that could instead finance resilient, sovereign AI infrastructure.

In the EMEA region, nearly half of companies spend up to SEK 55 million per year on cloud services. For an organization with an average cloud investment of SEK 41 million, that means almost SEK 10 million in unnecessary annual costs—money that restricts investment in AI platforms, resources for digital sovereignty, and the resilience of technical infrastructure.

Conflicting demands as AI adoption grows

These findings appear in Insight’s report on digital sovereignty, which identifies three conflicting demands companies must balance as AI use expands:

• Cost efficiency: With nearly a quarter of cloud capacity unused, funding for AI development and data platforms is undermined.
• Operational resilience: To guarantee availability, 47 percent of companies overprovision infrastructure and build costly redundant architectures to handle unexpected events.
• Digital sovereignty: Growing regulatory requirements for data residency and AI governance increase the need to run workloads in private data centers or hybrid clouds, forcing trade-offs between control, cost and performance.

According to the survey, AI-related cloud costs are rising by 12 percent annually. At the same time, 67 percent of companies already consider digital sovereignty a key strategic priority—a figure expected to climb to 82 percent within three years. Yet overprovisioning (47 percent), limited financial visibility (47 percent) and idle technical resources (46 percent) continue to inflate costs and limit agility.

Despite rising expenses, 56 percent of companies do not analyze total costs when making major infrastructure decisions. Another 41 percent are hampered by legacy applications that complicate change and optimization in cloud environments.

“Companies are wasting almost a quarter of their cloud capacity as AI drives up infrastructure costs. To scale AI sustainably, infrastructure must be treated as a strategic asset. That requires reducing waste, understanding total cost of ownership, and deliberately balancing performance, sovereignty and long-term cost efficiency,” says Sandra Simms, Country Manager Sweden at Insight.

As a result, interest in hybrid cloud is growing. Eighty-five percent of respondents are evaluating or deploying dedicated AI infrastructure. Insight’s research points to an opportunity to reclaim unused cloud investments through stronger financial controls, the removal of idle resources, and cloud strategies aligned with AI and digital sovereignty requirements.

In Sweden, digital sovereignty is rapidly becoming a strategic priority. Nearly three-quarters of companies already rate it as important today, rising to 84 percent within one to two years and 87 percent over the longer term. This trend reflects increased emphasis on sovereignty, operational resilience and long-term value as Swedish businesses boost cloud and AI investments.

Read Insight’s full report, “The Trilemma of Digital Sovereignty,” for more details.