Project Syndicate - The Missing Ingredient for European Tech Sovereignty
Europe’s dependence on US technology companies is both an economic challenge and a strategic vulnerability. The European Union’s new Tech Sovereignty Package is a step in the right direction, but without equally ambitious efforts to curb market concentration, it is bound to fall short.
In early June, the European Commission unveiled its Tech Sovereignty Package, a new policy agenda designed to strengthen Europe’s strategic autonomy through investments in AI, domestic semiconductor manufacturing, cloud infrastructure, and open-source software. While ambitious, the package is not enough. To ensure that AI and digital technologies advance the European Union’s economic and security interests requires confronting the root causes of Big Tech’s dominance over Europe’s digital economy.
The plan’s objective—to reduce the EU’s dependence on foreign technologies and, in turn, its vulnerability to external coercion—is laudable. Today, roughly 80% of the bloc’s digital technologies are imported, primarily from the United States. This has created a power imbalance that US President Donald Trump’s administration has not hesitated to exploit in pursuit of its political interests.
Yet the Commission’s plan is unlikely to shift that balance. Consider one of the package’s main goals: tripling the EU’s data-center capacity over the next 5–7 years. While expanding computing capacity is important, it will do little to foster a competitive domestic ecosystem unless Europeans capture a greater share of the economic value generated by AI.
Three American companies—Amazon, Google, and Microsoft—currently control 70% of Europe’s cloud market, while AI development is dominated by a handful of trillion-dollar US firms, including OpenAI and Anthropic, whose partnerships with Big Tech give them unparalleled access to capital and computing power. Without a concerted effort to tackle industry consolidation, most of the value created by Europe’s data-center buildout will ultimately flow back to the US.
Even if the Tech Sovereignty Package succeeds beyond expectations and helps create a new generation of fast-growing European startups, Big Tech could still use its market dominance to acquire or otherwise eliminate these challengers. Between 2010 and 2023, Big Tech companies acquired nearly 100 AI startups. Among them was DeepMind, whose 2014 purchase by Google has been widely viewed as a strategic loss for the United Kingdom, where the company was founded.
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