Horváth Study: Europe’s Defense Runs on U.S. Servers - NATO Critical Infrastructure Remains Exposed to Persistent Cyberattacks

  • Only 13% of cloud usage in the defense sector is provided by European vendors. Market concentration and U.S. legislation are becoming strategic pressure points

Access to current and reliable data has become a decisive strategic advantage in modern defense. This makes secure cloud-based data processing and utilization more critical than ever. Yet 72% of cloud usage among defense industry companies relies on U.S. providers such as Microsoft, Amazon, and Google. As a result, cloud dependency risks becoming a geopolitical leverage point.

The industry is well aware of the challenge: nearly one in two defense executives considers the absence of a sovereign cloud environment to be the single largest bottleneck limiting operational capacity. These are among the findings of the Horváth Aerospace & Defense study, based on interviews with senior executives from the aerospace and defense sector.
While U.S. providers operate nearly three-quarters of Europe’s cloud infrastructure, European providers collectively account for just 13%.

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U.S. Government Can Access Cloud Data
This situation is enabled by the U.S. CLOUD Act (Clarifying Lawful Overseas Use of Data Act), which requires American companies—including the three major U.S. cloud providers—to provide data to U.S. authorities upon request, regardless of whether that data is stored on servers located in Europe.

“Whoever controls the cloud may ultimately influence the outcome of a conflict. Europe needs more than investment in its own infrastructure. First, EU member states need a common definition of what a sovereign cloud should deliver,” explains the defense expert. “Without a shared understanding of digital sovereignty, any investment risks remaining fragmented and insufficient.”

AI Is Driving Disruption in Defense
There is also significant ground to make up in the area of artificial intelligence (AI). Eighty-two percent of surveyed executives believe AI has become the most disruptive force in the defense sector. They expect AI to transform command structures, operational management, and logistics more rapidly than any new weapons system.

However, widespread implementation of AI in business and operational processes remains some distance away. While 95% of surveyed companies have launched AI initiatives, many are still in the early stages of adoption. Concerns over data security and fragmented data environments continue to hinder scaling efforts. At the same time, pressure is mounting to accelerate AI maturity. By 2030, 90% of newly deployed military hardware is expected to be connected through networked systems.

“AI will only become a true military advantage if Europe maintains sovereign control over the underlying data. The real challenge is therefore not AI itself, but the sovereign cloud architecture that enables it,” says Ralf Gaydoul.

About the Study
For the Horváth Aerospace & Defense study, a representative sample of executives from defense companies across Germany and Europe was surveyed. The research is based on in-depth personal interviews with more than 60 C-level executives from the aerospace and defense industry.