- 2026 will be the year that sovereign AI clouds start to pay dividends
- Cloud consolidation will also top the list for the year ahead
- Plus, capital matters for more than just buying land and GPUs
The cloud market has faced unprecedented upheaval in 2025 thanks to AI. The technology has drastically inflated demand, brought compute power center stage and given rise to more than 50 new cloud players vying for their piece of the pie. All this is to say, 2026 has a high bar to clear if it wants to beat 2025 in terms of sheer disruption. But will it hit the mark?
We took the question to Vultr, EdgeCore, Cloudflare, HPE and WEKA. Here’s what they told us.
Consolidation becomes the name of the game
It seems 2026 will be the year the great cloud consolidation wave gets underway. Vultr CMO Kevin Cochrane predicted “More than 80% of the NVIDIA and AMD GPU market share will concentrate among a handful of neocloud and alternative cloud providers worldwide.” The winners, he said, will be those who have three key qualities: the ability to raise capital, those who can quickly deploy massive GPU clusters and those who can attract top-tier AI customers to their platform.
Players who lack one or all of these capabilities will “struggle to compete,” he said.
Consolidation will also have a role to play as software options proliferate and AI amplifies security concerns.
Cloudflare Chief Partner Officer Tom Evans told Fierce that 2026 will be the year that “the channel will shift away from ad-hoc solutions and gravitate towards consolidated bundles that secure entire environments—rather than individual applications—while reducing operational complexity and costs for customers.”
Bankrolling the cloud
Julie Brewer, EVP of finance at EdgeCore Digital Infrastructure, picked up on Cochrane’s point about capital being a key component for cloud and data center leaders in the new year. The catch? They’re running both a sprint and a marathon, she said.
“In 2026, the developers that thrive will be those who combine speed with strategic thinking, and creativity to structure capital in ways that others haven’t yet considered,” she said. And capital matters for more than just buying land and GPUs. “Utility providers and vendors are increasingly distinguishing between those with strong financial footing and those without.”
Brewer tipped asset-backed securities (ABS) to become a default play in data center finance in 2026. ABS use income-generating assets as collateral. Her prediction is interesting given Frontier Communications CFO Scott Beasley similarly said in March ABS could become more common in the cloud and data center realm.
“In 2026, ABS won’t just be an option but the baseline, setting the stage for the next wave of financial innovation in the industry,” Brewer said.3.
New classes of cloud providers
Both Cochrane and HPE Networking SVP and GM Praveen Jain said they expect to see the rise of new kinds of cloud players, but that’s about where the similarities in their predictions end.
For his part, Cochrane predicted the birth of a “new class” of hyperscaler – ahem, not “neoclouds” – that will “combine full public cloud capabilities with specialized AI infrastructure services, while supporting an open, composable ecosystem.”
Jain, meanwhile, said the edge and AI will converge into the new “micro-hyperscaler” environment.
“The edge data center in 2026 looks more like a mini-hyperscale campus than a telecom closet,” he said. “With 400G/800G Ethernet, AI inference accelerators, and autonomous operations, regional micro-data centers will handle workloads once reserved for central clouds.”
And just who will run these? According to Jain, everyone from cities to retailers and universities.
Sovereign AI clouds take over
2025 has been a big year for sovereign cloud and, more specifically, sovereign AI clouds. (See DT’s work with Nvidia to launch a sovereign Industrial AI Cloud as just one example.)
Shimon Ben-David, CTO at WEKA, said 2026 will be the year that sovereign AI clouds start to pay dividends, especially for the public sector.
“Countries building sovereign data centers will start deploying AI for population-scale services across healthcare, transportation and economic applications,” he predicted. “Governments that invest in AI infrastructure now will own the economic advantages that define the next era of global leadership.”
There you have it, folks. Do you agree? Or do you think the cloud market is headed in a different direction in 2026? Let us know in a letter to the editor! Email us at fiercenetwork@questex.com.