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Europe’s campaign to loosen the grip of American technology giants is colliding with a familiar obstacle: Europe itself. As Brussels prepares a series of decisions that could reshape the continent’s digital economy, senior EU officials remain divided over how aggressively to favour European companies at the expense of US rivals. The debate has exposed tensions between the bloc’s ambitions for “technological sovereignty” and fears of economic retaliation from Washington. At stake are two strategically sensitive sectors — satellite communications and cloud computing — both viewed in Brussels as essential infrastructure for the next phase of Europe’s economy and defence architecture. On one front, European policymakers are deciding how to allocate valuable mobile satellite spectrum expected to underpin future direct-to-device services. The frequencies are likely to become critical for everything from emergency communications to military applications and remote connectivity. Reuters reported this week that Brussels is leaning towards a compromise under which most of the spectrum would be reserved for European groups, while still allowing limited access for foreign operators including Elon Musk’s Starlink and Amazon’s Kuiper project. A parallel battle is unfolding in cloud computing. The European Commission is expected next week to unveil proposals designed to reduce dependence on US hyperscale providers such as Amazon Web Services, Microsoft Azure and Google Cloud, which together account for roughly two-thirds of the global market. The move reflects a broader shift in European industrial policy. Since the pandemic and the war in Ukraine, Brussels has become increasingly concerned about strategic vulnerabilities arising from heavy reliance on foreign suppliers across sectors ranging from semiconductors to energy and defence. The rapid advance of artificial intelligence has only intensified anxieties over Europe’s relative technological weakness. Officials close to the discussions say advocates of a tougher line argue Europe cannot build globally competitive technology champions while continuing to leave critical infrastructure markets dominated by American firms. Among the leading proponents of a more assertive “Buy European” approach are Stéphane Séjourné, the EU’s industry commissioner, and defence commissioner Andrius Kubilius. Supporters of their position argue that Europe’s security environment and deteriorating geopolitical landscape demand a more protectionist industrial strategy. Yet resistance inside the Commission remains substantial. Henna Virkkunen, the Finnish commissioner responsible for technology policy, is said to favour a less confrontational approach centred on common regulatory standards rather than outright exclusion of non-European groups. According to officials familiar with the discussions, her more pragmatic position may ultimately prevail. The internal dispute illustrates a deeper European dilemma. The continent wants digital independence but remains deeply intertwined with US technology ecosystems. European businesses, governments and public services continue to rely heavily on American cloud infrastructure, software platforms and AI tools. Replacing them would require vast investment and years of industrial catch-up. That challenge is underscored by estimates showing Europe trails the US by roughly €1tn in technology-related investment. Business leaders also warn that an overly rigid localisation agenda could damage competitiveness. Critics argue that excluding American firms from procurement processes risks reducing innovation, raising costs and slowing Europe’s digital transition. Economists have additionally cautioned that defining what constitutes a genuinely “European” technology product may prove difficult in globally integrated supply chains. At the same time, political pressure for stronger action against Big Tech continues to build. Across Europe, regulators have already tightened oversight of online platforms through landmark legislation such as the Digital Services Act and Digital Markets Act. Brussels has imposed substantial fines on US technology groups over antitrust and privacy breaches, while several governments are pushing stricter rules around online harms, data sovereignty and AI governance. The cloud debate has acquired added urgency amid fears that geopolitical tensions could expose European governments and companies to strategic vulnerabilities. Some officials privately point to concerns that access to critical digital services could become entangled in future trade or diplomatic disputes with Washington. Those fears have been amplified by Donald Trump’s return to the White House and uncertainty over the future direction of transatlantic relations. The result has been a growing push in Paris, Brussels and other European capitals to build more autonomous technological capabilities. Still, few in Brussels believe Europe can fully disentangle itself from American technology in the foreseeable future. Instead, the likely outcome is a more selective form of digital protectionism: favouring European firms in strategically sensitive sectors while stopping short of outright exclusion of foreign competitors. For now, Europe’s effort to curb Big Tech’s dominance appears set to advance cautiously — shaped as much by internal political compromise as by any grand vision of sovereignty. The coming weeks may reveal whether Brussels is prepared to match its rhetoric on technological independence with Europe

Europe Weighs Tougher Curbs on US Tech Giants Amid Strategic Anxiety

EU Global Editorial Staff -
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