Doesn't really matter when using AWS, Azure and GCP is not an option. They only have to compete and compare with other "EU native" solutions, not the US cloud giants.

In my experience in non-SWE related enterprise this isn't really an issue. To put it as bluntly as possible, most EU organisations don't have enough work to staff an team for their IT operations. Maybe you could have one or two people on staff, but that is realistically too few people to run reliable operations, even in Azure or AWS. So what happens is that we outsource all the parts that aren't directly related to development or IT support and operations to 3rd party companies.

Most of those 3rd party companies will happily sell you managed database service that are run on Hetzner. So this part of it is sort of a non-issue for a lot of organisations if the cost are low enough.

Heck, even if you have your own inhouse operations department going for you, why wouldn't you be able to run your own stuff on Hetzner? That's what people did in the transition from having your iron in the basement and buying it from Microsoft/Amazon. The only reason we left the "own cloud" options was cost, and if Azure exceeds the alternative. Or the EU makes it too cumbersome to use Azure, then there won't be much of a reason to stay.

They don’t. But I’ve explored launching a EU-based business that focuses on large businesses and Hetzner was one of the logical players. Good managed services without US exposure are really rare.

I run some smaller stuff on Hetzner. Have for the last 5-10 years and never had any issues. If Hetzner added managed Postgres, something like Cloud Run, and maybe PubSub I’d be moving over a bunch more stuff.