BRUSSELS — Europe is intensifying efforts to challenge U.S. dominance in cloud computing, AI and mobile operating systems, spurred by concerns over data sovereignty and political unpredictability. The European Commission’s newly appointed "tech sovereignty" commissioner, Henna Virkkunen, has identified quantum computing, semiconductor production and AI as key strategic priorities. Europe aims to foster local innovation by promoting initiatives like a “Buy European Act” and the €300 billion EuroStack infrastructure investment—even as critics warn of rising protectionism Financial Times.

Budgetary disparities are stark: U.S. tech startups attracted approximately US $139 billion in venture capital in 2024—more than three times Europe’s total Financial Times. Fragmented EU regulation compounds the challenge, while U.S. hyperscalers continue to bind European business to the Cloud Act, increasing exposure to American law enforcement TechRadar.

Europe is responding on multiple fronts:

• Cloud “sovereignty” push: Public and private players—including OVHcloud, Capgemini, Airbus, EDF and Telecom Italia—are building sovereign cloud offerings. Yet, over 70 percent of European enterprises still use U.S. cloud providers TechRadar.

• Regulatory pressure on gatekeepers: The EU’s Digital Markets Act compels Apple, Google and others to open platforms and ban data silos—aimed at reducing U.S. platform leverage Wikipedia.

• Chips and semiconductor ambition: Through the European Chips Act, the EU seeks to capture 20 percent of global chip production by 2030—up from under 10 percent—to help build resilience Wikipedia.

Still, analysts caution that these moves alone won’t level the playing field. True digital sovereignty requires deeper alignment: consolidated talent and funding, coherent regulatory frameworks, and sustained public–private investment TechRadar.

What’s next?
Europe’s path forward hinges on balancing regulatory stringency with innovation incentives. If successful, the EU could cultivate a competitive tech ecosystem that rivals U.S. giants while protecting local data interests. Failure to do so may result in “sovereignty washing”—superficial efforts without real technological autonomy Financial Times.

Europe’s digital future is at stake. Will leaders risk fragmentation and underfunding, or seize this geopolitical opportunity with unified strategy and investment?

If you found this insightful, don’t miss our related features on Europe’s AI policy and data protection strategy at Cerebrix.