Building On-Premises AI Infrastructure to Reclaim Data Sovereignty and Control

As enterprise AI adoption moves from experimental pilots to mission-critical production, technology leaders are increasingly questioning the long-term viability of public cloud AI services.

The reliance on per-token pricing models and the lack of transparency regarding model updates have created significant operational and financial risks. To mitigate these concerns, a shift toward on-premises AI infrastructure is emerging, allowing organizations to maintain full control over their data, model lifecycle, and inference costs. New architectural approaches, such as disaggregated inference factories, are enabling this transition by separating prefill and decode processes. By utilizing shared high-performance storage layers for key-value caching, these systems allow enterprises to scale GPU resources independently while avoiding the latency penalties of recomputing context.

This shift provides a viable path for IT leaders to deploy sophisticated agentic applications and specialized chatbots without sacrificing performance or ceding control of their proprietary data to third-party providers. Ultimately, this move toward sovereign AI infrastructure offers a strategy to align storage economics with the realities of production-scale machine learning workloads.

Key messages / Action points:

• Evaluate the total cost of ownership for public cloud AI versus on-premises infrastructure to identify potential savings on per-token and egress fees.
• Adopt disaggregated inference architectures to decouple prefill and decode workloads, enabling more efficient GPU utilization and independent scaling.
• Prioritize data sovereignty by implementing storage layers that support persistent key-value caching, reducing the need for redundant computation and keeping sensitive context within the enterprise perimeter.

Keywords: AI infrastructure, data sovereignty, inference optimization, GPU utilization, enterprise AI, storage architecture

Reference from Blocks &Files:
https://www.blocksandfiles.com/object/2026/10/09/scalitys-ai-inferencing-factory-accelerates-inferencing/5302192