Microsoft has announced it will introduce in-country data processing for its Microsoft 365 Copilot AI tool across 15 nations by 2026. The move is designed to meet growing demands for data sovereignty and address strict regulatory compliance requirements in key markets, particularly for government agencies and other highly regulated industries. This ensures that customer data associated with Copilot interactions is processed and stored within their national boundaries. The initiative will begin with users in India, Australia, Japan, and the United Kingdom, who will have access to local data processing by the end of 2025. This expansion builds upon Microsoft's existing data residency offerings for Microsoft 365, which are already available in 27 countries. By localizing the processing of AI prompts and responses through its regional data centers, Microsoft aims to enhance trust and security for its global customer base.