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Confidential AI: Cloud AI with On-premise Security at Cloud Pricing

The Confidential AI Assistant brings the power of generative AI to your business while keeping sensitive data fully protected. With confidential computing, all information stays encrypted end-to-end — even during processing — so your teams can work smarter without compliance risks.

Jason Wirth
Jason Wirth
9/17/2025
Confidential AI: Cloud AI with On-premise Security at Cloud Pricing

Confidential AI: The Missing Piece for Safe Enterprise AI Adoption

AI is transforming how businesses work. From faster access to knowledge to automating critical tasks, the potential is enormous. But for many organizations, one question continues to hold them back: how do you embrace AI without compromising security and compliance?
This is where Confidential AI comes in. It closes one of the biggest gaps in enterprise AI adoption, enabling teams to leverage generative AI safely and confidently.

The Enterprise AI Dilemma

Organizations today are caught in a tug-of-war.
  1. Business teams want speed, efficiency, and innovation to stay ahead of competitors and meet rising customer expectations.
  2. IT and legal teams must safeguard sensitive data, ensure compliance, and minimize risk.
The result? Innovation often stalls. Employees who feel blocked may turn to shadow IT — plugging sensitive company data into unsanctioned AI tools.
Consider an example: a legal associate at an insurance company needs to summarize a 40-page contract before a client meeting. With no approved AI solution in place, he pastes the contract into a free online chatbot. Within seconds, he has a neat summary. Problem solved — or so it seems.
The catch: that contract contained confidential customer data and proprietary clauses. By running it through a public AI service, the employee may have exposed sensitive information outside company control. The organization now faces compliance risks, data protection violations, and potential legal consequences.
This scenario plays out in countless industries every day. The core issue? Employees want the productivity boost AI offers, but organizations struggle to deliver secure, compliant solutions.

Where Standard AI Falls Short

Most people assume encryption fully protects their data. In reality, traditional encryption only covers two stages:
  1. Data at rest – when information is stored.
  2. Data in transit – when it moves across networks.
But during processing — when the AI is actively working with your data — information is usually exposed in plain text. This phase, known as “data in use”, is the weakest link.
That means when you enter sensitive data into an AI system, the provider (or even the cloud operator hosting it) could theoretically access it during processing. Even with strong contracts, the technical risk remains.

What Makes Confidential AI So Important

Confidential AI solves this problem through confidential computing.
Instead of exposing your data during processing, confidential computing keeps it encrypted even while the AI is working with it. The key innovation is the use of secure enclaves — isolated, locked-down environments inside a computer’s processor.
Think of it as a vault: the AI model can operate on your data inside the vault, but nobody else — not the cloud provider, not system administrators — can look inside.
This means your data is safeguarded across all three stages:
  1. At rest
  2. In transit
  3. In use
By closing this final gap, Confidential AI makes it technically impossible for outsiders to see or misuse your sensitive information.
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Why It Matters for Enterprises

Confidential AI is more than just a security upgrade — it directly addresses the two main barriers holding AI adoption back.
1. Deep-integration into enterprise software
  • Security: Sensitive data like contracts, patient records, or payroll figures remain protected at all times.
  • Compliance: Strict industry and regulatory requirements can be met with confidence.
  • Integration: Unlike generic public tools, Confidential AI is designed to embed directly into enterprise workflows.
According to a recent Fortune, 95% of corporate AI pilots fail, often due to poor integration and security concerns. Confidential AI tackles this head-on, making it safe to deploy AI where it matters most.
2. Cloud vs on-premise deployment
It also bridges the deployment dilemma companies face:
  • Cloud AI offers agility and low costs but exposes data to providers.
  • On-premise AI offers control but is expensive, complex, and slow to scale.
Confidential AI combines the best of both worlds — cloud agility with on-premise-level security — allowing enterprises to adopt AI without compromise.

The Confidential AI Assistant in Action

The Confidential AI Assistant feels like any other AI tool — helping with critical daily tasks — but when powered by Kern AI’s advanced RAG engine, Cognition, it outperforms most standard LLM providers.
From the user’s perspective, it feels just like any modern AI chat tool. Employees can:
  • Securly search company knowledge
  • Draft and refine texts
  • Automate routine tasks
But behind the scenes, every interaction runs inside secure enclaves powered by confidential computing.
For employees, this means they can finally use AI without fear of exposing sensitive data. For IT and compliance teams, it means seamless governance and control. And for leadership, it means AI can scale across the enterprise safely — unlocking innovation without putting the business at risk.

Final Thoughts

Generative AI is no longer optional for competitive businesses. But adoption will only succeed if organizations can balance innovation with trust.
Confidential AI is the missing piece of that puzzle. By securing data across every stage of processing, it eliminates one of the last big blockers to enterprise AI adoption. With Confidential AI, enterprises don’t have to choose between productivity and protection — they can have both.
Get in touch to see Kern AI's Confidential-AI in action
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