Deutsche Telekom (DTE GY) and Alphabet's (GOOGL) Google are distancing themselves from the sovereign cloud partnership for the German government and firms, Handelsblatt reports citing sources. Google said to be in talks with a new partner for the deal.

The distancing of Deutsche Telekom and Alphabet's Google from the German government's sovereign cloud partnership signals potential disruptions to key tech infrastructure initiatives. If Google secures a new partner, it could reshape competitive dynamics in the German market, impacting investor sentiment towards both companies and potentially affecting share prices in the broader telecommunications and tech sectors.