A broad coalition drawn from throughout the ranks of Europe’s tech {industry} is looking for “radical motion” from European Union lawmakers to shrink reliance on foreign-owned digital infrastructure and companies to bolster the bloc’s financial prospects, resilience, and security in more and more fraught geopolitical occasions.
In an open letter to European Fee president, Ursula von der Leyen, and the EU’s digital chief, Henna Virkkunen, which information.killnetswitch reviewed forward of publication, greater than 80 signatories (representing round 100 organizations) stated they need regional lawmakers to rethink present assist efforts in order that they’re centered on fostering uptake of homegrown alternate options with the strongest industrial potential — from apps, platforms, and AI fashions to chips, computing, storage, and connectivity.
Corporations spanning areas together with cloud, telecoms, defence, together with a number of regional enterprise and startup associations, have put their names to the letter — which was despatched to the Fee on Sunday — urging the bloc to modify its tech technique onto a quasi-war footing by committing to assist “sovereign digital infrastructure.”
The plan pushes for lowering reliance on foreign-owned Huge Tech by actively fostering improvement of a so-called “Euro stack.” The European digital infrastructure pitch will not be popping out of skinny air — a Euro Stack paper written by, amongst others, the competitors economist Cristina Caffarra was revealed in January fleshing out the technique in some element.
There has additionally been, during the last half 12 months or so, a smattering of convention chatter turning over the potential for enterprising Europeans to grab a geopolitically fraught second to press the case for the EU to undertake a digital industrial technique that’s squarely centered on favoring native innovation.
The rallying name to place European tech first — backed by corporations together with Airbus, Component, OVHCloud, Murena, Nextcloud, and Proton, to call just a few — follows the shock of the Munich security convention, the place U.S. Vice President JD Vance tore into Europe like an assault canine, leaving delegates in little question that the post-Struggle worldwide order is in tatters and all bets are off in terms of what the U.S. may do beneath President Donald Trump.
Key tech infrastructure that’s owned and operated by U.S. corporations doesn’t appear to be such a stable purchase, from a European perspective, if a presidential government order will be issued forcing U.S. corporations to modify off service provision or terminate a provide chain at a pen stroke.
“Think about Europe with out web search, e mail, or workplace software program. It will imply the whole breakdown of our society. Sounds unrealistic? Effectively, one thing comparable simply occurred to Ukraine,” Wolfgang Oels, COO of the Berlin-based, tree-planting search engine Ecosia — one signatory to the letter that was already taking steps geared toward lowering its dependency on U.S. Huge Tech suppliers — tells information.killnetswitch.
“Trump switched off entry to very important infrastructures as a result of Ukraine was not able to cede its land and hand over its minerals,” Oels stated. “Europeans want sovereignty in important infrastructures and people don’t solely encompass vitality and well being, however definitely additionally digital ones.”
Vance’s latest flip in Paris, on the AI Motion summit, additionally noticed the U.S. vice chairman lay into European lawmaking as a barrier to innovation, and a barrier to U.S. tech supremacy. His message boiled all the way down to “do what we are saying or else” — because the Trump administration made it loud and clear it’s hell bent on retaining digital dominance because the world strikes into an AI-accelerated period.
The {industry} letter isn’t solely responding to exterior threats, although. It follows (and references) the 2024 Draghi report on EU competitiveness — which has induced a lot hand-wringing in European capitals over what to do about slowing regional progress, however much less clearly tangible motion. (Therefore its writer’s exasperated cry to lawmakers within the European Parliament only a few weeks in the past — to “do one thing“.)
The coalition’s missive affords a European tech {industry} first stab prescription for motion, mixed with a stark warning of the perils of the bloc persevering with as is.
With out pressing motion to foster demand for European-made applied sciences ,there’s a threat that U.S. hyperscalers’ takeover of important digital infrastructure provision in areas like cloud computing will likely be full, Euro Stack backers recommend — explicitly predicting that: “Europe will lose out on digital innovation and productiveness progress with out sweeping and pressing change.”
“Our reliance on non-European applied sciences will turn into virtually full in lower than three years at present charges,” they go on to warn.
So what’s the particular one thing that this tech {industry} coalition is advocating for the EU to do?
Purchase European
The letter suggests the bloc may assist stoke demand and unlock funding by adopting public procurement necessities that will require at the very least a portion of public our bodies’ digital necessities to come back from native suppliers (aka a “Purchase European” mandate — favoring “European-led and assembled options”).
“Trade will make investments if there are sufficient demand prospects,” the letter writers say, occurring to recommend, “Prioritising areas the place Europe can already ship will likely be key to shifting assets quick to European suppliers, creating worth and market in a virtuous circle.”
“The purpose is to not exclude non-European gamers, however to create area the place European suppliers can legitimately compete (and justify funding),” they add.
Caffarra dubs procurement necessities a “no brainer.”
“We want the general public sector to be instructed to purchase European, or largely European,” she tells information.killnetswitch. “What’s so unhealthy about that? People do purchase American, Chinese language purchase Chinese language — and we European say, ‘oh, purchase all the things by all means’.”
The argument is that in an “America First” world, the place the world’s strongest nation can’t be counted upon to have Europe’s again anymore, the EU’s studious neutrality — vis-a-vis the place it invests its assets — seems like a idealistic relic of a gentler age.
Whereas the general public sector could possibly be given ‘Purchase European’ mandates, for personal sector consumers, Caffarra says a Euro Stack plan may embrace “inducements” to modify to homegrown suppliers — whether or not via vouchers or another assist mechanism. “Sure, they must be backed, in some sense — however we’re not speaking about monumental, monumental sums,” she suggests.
Pooling and federating
Different suggestions set out within the letter embrace the EU taking steps to allow “viable provide” by encouraging European technologists to undertake a “pooling and federating” method, together with the event of widespread requirements — as a technique to speed up scaling of homegrown digital infrastructure.
By working collectively on aligned approaches, the purpose is to dial up European suppliers’ capability to compete towards the likes of U.S. hyperscalers, corresponding to within the case of cloud computing.
“This implies once more working with {industry} to stock assets quick, supporting open supply options and interoperability (each technically and commercially), aggregating ‘better of breed’ current belongings, supporting onboarding with integration platforms and low compliance boundaries — whereas assembly localization and security imperatives,” the letter suggests — advocating for precedence be given to “tasks that deal with primary infrastructural wants, corresponding to {hardware} autonomy and sovereign cloud and platforms.”
Whereas there have been previous makes an attempt on this route — notable, the Gaia-X effort launched again in 2020 which was geared toward powering up a European cloud to rival U.S. and Chinese language suppliers — that digital sovereignty push was successfully defanged as soon as U.S. hyperscalers obtained let in.
“When AWS and Microsoft particularly, and Google, obtained into Gaia-X, they blew it up from inside,” notes Caffarra.
The letter additionally takes a stab at articulating why it’s so self-defeating for Europe to roll out the welcome mat to international hyperscalers whose expansionist, proprietary playbook is all about maximizing buyer lock-in and lease extraction.
“With non-European firms extracting worth and concentrating energy via proprietary applied sciences, ‘openness’ (open science, requirements, information) must be a pillar of Europe’s digital sovereign technique,” it contends.
Signatories are additionally pushing the EU to assist the event of harmonized necessities for public/personal cloud customers to choose to make use of “sovereign cloud companies” for storing their delicate information (corresponding to a certification scheme) — which can also be framed as a security measure to protect towards non-EU extraterritorial legal guidelines that may pose a threat to European information.
Additionally they need the bloc to evaluation its current EU Digital Decade technique — and, the place obligatory, repurpose current plans to make sure funding goes to “tangible, market related, result-oriented tasks”, as they put it.
Moreover, the letter requires the EU to evaluate tasks for potential funding via a enterprise outcomes lens — e.g. by utilizing key efficiency indicators, important success components and so on — to be able to be sure that EU funds go to companies with “robust adoption prospects.”
Redirecting and concentrating EU assist on homegrown tech infrastructure that has the strongest potential to scale is core to the plan.
Sovereign infrastructure fund
On funding, the letter makes a name for the EU to arrange a “Sovereign Infrastructure Fund” to assist public investments in European digital infrastructure — particularly in capital intensive areas of the tech worth chain (corresponding to chips and quantum computing).
Caffarra argues that such a fund wouldn’t require big quantities of cash — smaller quantities could possibly be strategically focused, she suggests, corresponding to in the direction of sustaining open supply infrastructure.
“The open supply group in Europe is big and extremely, extremely succesful,” she argues.
She additionally dismisses strategies that there can be eye-wateringly excessive prices for implementing Euro Stack general — such because the €5 trillion+ price-tag that’s been floated by U.S. commerce group, Chamber of Progress, which counts a number of U.S. tech giants as members — emphasizing that this isn’t a name to tear out and change all the things. Relatively it’s a plea to Europe to get on the identical web page and work collectively on a joined-up digital industrial technique with the purpose of accelerating native capability by constructing demand for foundational applied sciences that European corporations are already capable of present.
By locking in future demand, the Euro Stack pitch is that this can foster extra native tech {industry} progress and innovation — whereas serving to the bloc chart a course in the direction of better autonomy in important digital infrastructure.
Nonetheless, on funding Caffarra concedes that there are “different issues that must be completed” — pointing to what number of European entrepreneurs find yourself crossing the pond to search for VC funding, for instance.
“A sovereign fund that invests in European startups? Heck yeah, we should always have that,” she provides, whereas nonetheless arguing that the sums concerned will be comparatively small, corresponding to by specializing in early stage startups (vs showering “helicopter cash” on established corporations).
Rethinking who leads
Whereas the EU has been speaking among the discuss on digital sovereignty beneath von der Leyen’s presidency, the Euro Stack coalition is actually dismissing present efforts on this route as poorly directed and, in the end, wasted.
An excessive amount of funding is flowing in the direction of academia and experimental R&D of their evaluation vs tangible industrial efforts — which, given the precise assist to scale, may truly obtain the purpose of strategic autonomy in digital infrastructure, is the suggestion. Therefore why the letter is pushing the EU arduous to just accept an industry-led effort to show this tanker vs persevering with with top-down policymaking enterprise as common.
Caffarra’s evaluation of the EU’s report on digital sovereignty is especially withering — she dubs its method “ineffective” and argues that, for instance, the EU’s latest push to arrange so referred to as “AI factories“, as an AI ecosystem-building measure, is simply too reliant on educational consortia to ship something that’s commercially helpful.
The letter is rather less plain-speaking. But it surely’s basically making the identical enchantment for the bloc’s lawmakers to get out of the way in which in terms of important decision-making in relation to Europe’s dwindling digital infrastructure prospects — and as an alternative lean into their “convening powers to mobilise {industry} to actively assist coordinate and validate a continent-wide technique to energy a European digital sovereign effort,” because it places it.
“To assist Europe on this acute second of disaster for our security and strategic autonomy, the Fee should urgently type and convene working teams with {industry} to remodel its tech sovereignty ambition into concrete actions,” the {industry} coalition suggests.
information.killnetswitch reached out to the European Fee for a response to the Euro Stack pitch paper however on the time of writing it had not responded.
Trade voices
A full record of signatories is included on the backside of the letter — however Caffarra sums up the collective ink as “virtually all of Europe’s cloud, telcos, software program, open supply and so on, plus industrial giants like Airbus and defence like Dassault Systemes.”
She expects extra corporations to affix as backers within the coming days (together with from Europe’s AI ecosystem), but in addition claims that some that wished to again the decision didn’t signal as they’re apprehensive about retaliation from Huge Tech since they’re additionally their clients. (And it’s value noting that French AI large Mistral, which isn’t presently a signatory to the letter, not too long ago made its personal plea for shrinking dependency on U.S. suppliers by shopping for European — whilst CEO and founder Arthur Mensch stated “pragmatism” is required as some digital infrastructure can’t be acquired every other method).
In addition to tech corporations, a spread of regional enterprise associations have put their title to the letter — together with the likes of Join Europe (representing telcos), the OSBA (Open Supply Enterprise Alliance), European Digital SME Alliance, European Startup Community, and France Digitale to call just a few.
On startups Caffarra agrees that for some European entrepreneurs and their buyers attaining an exit to U.S.-owned Huge Tech is the endgame — which may create some stress in terms of supporting a technique that’s explicitly pulling within the different route. (She name-checked one startup affiliation that didn’t signal as she stated its members had been open about their hopes to get “in mattress with Huge Tech” — however we’ll spare their blushes.)
“That’s a technique out,” she provides of this Huge Tech exit playbook. “I’m not stopping that — I’m saying that there must be European alternate options to it.”
Europe first?
Discussing why he’s backing the Euro Stack proposal, Johan Christenson, founding father of European cloud supplier Cleura (previously Metropolis Community) — and now head of know-how on the Swedish cloud supplier Iver (one other signatory), which acquired Metropolis Community in 2020 — tells information.killnetswitch: “The modifications wanted are so foundational I feel Europe wants a brand new Airbus-like undertaking round digital to face an opportunity.”
“Whereas protectionism is rising in varied locations — I feel Europe must assume totally different. By setting necessities corresponding to use of open supply or {that a} chat software or video convention system must be interoperable with all others,” he goes on. “Or ensuring extensions in productiveness instruments adhere to requirements accepted by Europe — so Libre workplace at all times will work nice with Phrase or Energy Level as an illustration.
“There must be some aspect of public procurement requirement as nicely.”
Any Yen, founding father of Switzerland-based privateness instruments maker Proton — one other signatory to the letter — additionally says an enormous shift of mindset is required.
“Traditionally the thought of considering ‘Europe First’ has been taboo, seemed down on as being unseemly. And whereas the impulse to set a worldwide instance and ‘play truthful’ is admirable, it’s naive and has left Europe at an obstacle,” he warns, including: “America and China have at all times been America First and China First, Europe must do the identical.
“European tech hasn’t fallen behind resulting from a scarcity of talent, expertise or creativity. It’s fallen behind due to a scarcity of demand. For 30 years, European governments and firms have made the shortsighted resolution to obtain know-how from the U.S. and China for brief time period value financial savings, slightly than making the strategic selection of investing in growing European capabilities.
“Fixing this demand downside is most simply completed by requiring that European public sector purchase European, creating the impetus for the event of Europe’s tech sector.”
Yen says the demand scenario is so important Europe wants to not stage the enjoying subject however actively tilt it in favor of homegrown tech. “That is most simply completed by fixing the demand downside by requiring public procurement (and maybe even personal procurement) to purchase European,” he suggests.
Requested concerning the influence of the Digital Markets Act (DMA) — the bloc’s flagship competitors reform that’s been up and operating since March 2024. aiming to drive market contestability on Huge Tech dominance — Yen says he doesn’t assume the regulation is ample by itself. Therefore Proton backing the Euro Stack name for extra radical motion.
“We see that now one 12 months after the introduction of DMA, the place nothing has materially modified and the marketshare of Huge Tech in Europe can also be unchanged,” he tells information.killnetswitch. “Merely put, even when DMA can shave some extent off of American GDP via fines, it can do little to develop European GDP because it doesn’t essentially create the demand obligatory for GDP progress.”
He additionally doesn’t mince his phrases in evaluation the efficiency of the Fee — arguing it’s “prioritizing the Europe of the previous as an alternative of wanting in the direction of the Europe of the longer term.”
“Successive generations of European entrepreneurs with the imaginative and prescient of what needs to be completed have come and gone and have been saying the identical factor for many years — maybe now’s the time to start out listening to them,” Yen provides.
Frank Karlitschek, CEO and founding father of German cloud companies participant Nextcloud — one other letter signatory — emails a protracted record of solutions when requested why he believes Europe wants a brand new method and what are the dangers of simply doing extra of the identical, flagging a raft of information security and privateness dangers, together with the looming risk of financial “blackmail” beneath the boot of an America First U.S. administration.
“The U.S. government proper now’s displaying they haven’t any qualms utilizing government energy, from tariffs to sanctions, to realize fully unrelated objectives,” he notes, including: “Greater than ever earlier than, U.S. cloud companies is usually a chokehold for political, financial or different causes. And organizations are in search of higher choices.”
Altering European procurement guidelines to, for instance, set a requirement that “important infrastructure” have to be 50-80% open supply in a 12 months or two wouldn’t value the tax payer something, Karlitschek suggests, however “would create an explosion of latest startups and innovation” since European tech corporations are higher positioned to capitalize vs U.S. counterparts (which skew in the direction of proprietary, slightly than open supply).
“Extra authorities contracts have to be awarded to European open supply corporations,” he additionally suggests, noting latest strikes by the German authorities on this route, and arguing: “Digital sovereignty can solely be achieved with open supply software program.”
Karlitschek additionally lauds efforts to agree requirements that make it simpler to maneuver work masses from one cloud supplier to a different.
“One instance is the not too long ago launched open cloud {industry} commonplace API specification SECA which permits to deploy and run workloads seamlessly throughout totally different cloud environments,” he notes. “This allows the various European service suppliers to collectively type a community with better scalability and continuity than every can present individually.
“Equally, smaller distributors can and must be inspired to pool assets collectively into joint choices, giving the general public sector and huge companies extra certainty when it comes to continuity.”
In additional remarks, Karlitschek requires the EU to correctly implement its current suite of digital rules towards Huge Tech — “from privateness to antitrust guidelines” — suggesting sturdy motion on compliance may assist transfer the needle. “The Huge Tech corporations usually are not dealing with many penalties for his or her gatekeeping and a few elementary points round privateness usually are not addressed,” he factors out.
Nonetheless Caffarra has no truck with such fiddling sideshows. She’s satisfied {that a} far greater shift of mindset is required; one which calls for the EU get the heck out of its regulatory consolation zone.
“They’re regulating the highest [of the stack] — search, social networks, e-commerce and app shops; these are the issues that the DMA is concentrated on. These are the merchandise,” she emphasizes, when requested why the EU robustly implementing its current guidelines isn’t the reply to digital autonomy. “We’re speaking about infrastructure that lies beneath it — so compute, cloud, connectivity, chips. So the DMA will not be bothered with that.”
The important thing level that the areas’ lawmakers should grok and quick is that the majority tech infrastructure is now outdoors European management, warns Caffarra — and that requires a radical new survival technique, not a tweak of the dial.
