It is just a data center that is fully within the sovereignty of a country.
One issue many companies and governments have with the cloud, is that most leading providers run it out of data-centers around the world and that the companies that manage them are foreign companies.
For example a European country might be concerned about using an American provider using American data-centers for sensitive information because the information in that cloud will be subject to US laws. This is an issue when it comes to such things as privacy and the US government getting access to the data.
If the NSA asks Microsoft to give them access to some French Office365 data, Microsoft can’t really say no normally.
This has been tried to work around by having Microsoft host the data on servers in Europe, but Microsoft was still an American company subject to US laws.
Some other companies now try to fill the gap by having governments spend lost of money to build and run their own data-centers in their own jurisdiction. How effective that is when the companies like Oracle etc are still US remains to be seen.
There is also the issue that one of the benefits of the cloud is that it doesn’t matter where the data is and that it is ideally spread around for redundancy. restricting it to single local data center is a step backwards in that area.
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