US President Trump’s UK state visit in September was marked by a host of accompanying US tech titans, some of whom helped elect him. The chief executives of Nvidia, Microsoft, Apple and OpenAI treated the US President to a show of fealty worthy of a royal entourage.
The highlight of the trip, on the 18th September, saw Trump and UK Prime Minister Starmer announce the UK US Tech Prosperity Deal, an historic accord for deeper cooperation between the two countries’ technology innovation efforts and a much-needed boost for a UK Labour government failing to deliver on its promise of economic growth.
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The deal aims to give the UK’s tech ecosystem access to US datasets, infrastructure and compute power, as well as collaborative R&D and shared research funding opportunities on quantum, nuclear and AI. It also signals greater collaboration on regulation, national security and the skills needed to advance the UK’s technology sector, according to the official memorandum of understanding.
The deal was accompanied by a raft of US Big Tech investment announcements in the UK’s AI infrastructure. These included a $30bn investment by Microsoft which includes includes building the country’s largest supercomputer in partnership with British company Nscale, a $5bn investment by Google including the opening of a data centre in Waltham Cross, Hertfordshire, a $1.5bn investment by US datacentre company CoreWeave in Scotland and the establishment of Stargate UK in a collaboration between Nscale, OpenAI and US chipmaker Nvidia.
While policy makers and tech titans alike touted the deal’s mutual benefits there was some scepticism that the US may have more to gain the UK’s cheap land and labour – some even likening the agreement to a Western multinational exploiting developing world resources (with the view that the UK has been much relegated by its economic misfortunes to low value investment location).
Most of the investment focuses on data centre buildouts, with the majority of jobs created during the construction and build out phase as data centre management is not job intensive. The huge infrastructure investment also raises the question of UK energy and water supply being diverted away from local populations in order to facilitate such levels of compute power.
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By GlobalDataBut above all, these private investments by private companies with global market dominance raise questions around data sovereignty, geopolitical tensions and UK tech increasing becoming a satellite arm of the US rather than a sovereign tech power in its own right.
Across the channel European Union law makers have made a concerted effort to distance their own business ecosystems from the auspices of US Big Tech companies. France and Norway are developing their own sovereign clouds and are involving local partners in the endeavour.
Indeed, some of the Tech Prosperity Deal’s raft of US digital infrastructure investment did include a local partner Nscale, a company seemly sprung from nowhere in 2024. Little is known about this relatively recent newcomer. Nscale chief commercial officer, Karl Havard, has publicly stated that the company is the the UK’s only full-stack, sovereign AI infrastructure provider, telling Capacity in July 2025 that: “This reflects our belief that control over local AI infrastructure and compute is essential to national resilience, economic growth, and global competitiveness.”
Digital sovereignty becomes a business priority
Sovereignty has become an increasingly important issue within the digital economy evinced by the then Conservative UK government’s decision to classify data centres as critical national infrastructure in September 2024. However, economic imperatives mean that the UK government welcomes foreign direct investment in UK digital infrastructure. But are UK businesses concerned whether their data is being stored, processed and managed over US run infrastructure?
Claudio Corbetta, CEO of team.blue says it “absolutely makes a difference” for SMEs. The company’s own research found that nearly three-quarters (73%) of SMEs across the UK and Ireland are concerned about their data being stored in the US. This is also happening in Europe, with 72% of SMEs worried about their data being stored in the US. This anxiety is tied to frameworks like the US Cloud Act and continuing debates over the adequacy of the EU–US and UK–US data transfer arrangements, explains Corbetta. The US Cloud Act gives US law enforcement the power to demand electronic data stored overseas by US companies.
“The sovereignty question for SMEs goes beyond infrastructure capacity. It is about whether they trust that the data falls under either EU and/or UK jurisdiction, or not. What we’re hearing from customers across Europe is that this distinction has direct implications on their ability to adhere to regulations, as well as maintaining and building on consumer trust,” says Corbetta.
Corbetta says that SMEs increasingly see confidence in data sovereignty as a business differentiator, as it’s shaping procurement decisions and customer relationships. “If we take a step back and look at the wider European context, while Big Tech plays a huge role in AI and cloud infrastructure, we’re seeing a shift that provides opportunities for European tech companies. Europe-based providers can compete on capability while offering the certainty that data remains protected under local laws. For many SMEs, that combination of sovereignty and trust is now just as important as performance or price,” says Corbetta.
“From what we’re hearing, company directors and customers are increasingly raising questions about data location, and that pressure is shaping real business decisions.
“For tech leaders, the takeaway is that digital sovereignty is not just a compliance topic, it’s a strategic one. Providers that can combine transparency, guidance, and local hosting solutions are increasingly seen as true partners. Sovereignty isn’t an add-on, but the foundation for sustainable digital growth,” he adds.
UK opportunity for sovereign AI infrastructure
Many British business leaders like Mahdi Yahya, founder and CEO at UK AI specialist data centre provider Ori, sees a clear opportunity arising from the fact that digital sovereignty is increasingly becoming a boardroom priority for UK businesses.
The infrastructure funding announcements in the UK [US UK Prosperity Deal] mark an exciting time for the space, says Yahya, though it’s still a niche market to some extent. And the market potential for a largely UK owned and run AI infrastructure does exist. While the incumbent Big Tech cloud providers dominate, the price point, the fact that Ori’s infrastructure is built ground up specifically for AI and the data sovereignty proposition of using a UK company is what has allowed the company and other players in the space to build successful UK businesses on the back of this demand for specialist AI infrastructure.
Yahya doesn’t see the demand opportunity decreasing any time soon. “The big buying factor for a lot of enterprises, especially in Europe and Middle East, is around the sovereignty of infrastructure,” he says.
“AI will have access to and will be interacting with all the data that you have. And so, whether you’re a government entity, or an enterprise in a regulated sector, or operating in compliance heavy sector, it becomes extremely important to know where the infrastructure is and what control there is over the infrastructure.
“And many governments in Europe, specifically, and enterprises in Europe now have mandates that they need to be working with cloud providers that are local or sovereign for this precise reasons,” adds Yahya.
How would a smaller UK industry compete with big US cloud players on AI infrastructure? “It’s impossible for them to overcome the sovereignty issue, because obviously they’re US controlled,” he says.
“Some customers we talk to are adamant that they don’t want to be working with a provider that is subject to the US cloud act, for example, and the US cloud players are still subject to that. So that removes that portion of the market for them,” he explains.
And then the other big differentiator, or opportunity, is around performance specialisation of a company like Ori that was built from the ground up with AI in mind. “Like any industry, you have incumbents, and then a new technology that comes to light, and along with that come new players with a more differentiated offering, with a more performant offering, a more cost-effective offering, and that’s where we are at the moment,” he says.
Build British Big Tech
British veteran entrepreneur and CEO of AI research engine Corpora.ai, Mel Morris, sees the UK’s massive investment focus on AI infrastructure as “a wakeup call in terms of what we spend our money on”.
In Morris’s view, UK investment patterns are simply following prevailing trends and lack innovative foresight. “The money is following the fashion. The fashion says, get Jensen Huang over here, let’s put $5bn to get some GPUs in place and build a big data centre. Meanwhile, we’re seeing small entrepreneurial startups, with game changing technology that potentially could double the gross domestic product of this country, struggling to get heard and to get financed.”
Morris’s call to action is to reframe the UK’s focus on AI infrastructure to encompass a wider, more innovation first approach.
“Forget the amount of GPUs. In three years they’ll be worth nothing, because you’ll need them to be ten times faster and a tenth of the price. Let’s focus on what are small amounts of money, relatively speaking, that we could spend to build sovereignty, to build the technologies that allow us to compete, because at the moment, we’re [the UK] a net importer of AI tech, and I think that’s a dangerous place to be.”
