Europe faces a fundamental question shaping its digital future: should it develop its homegrown digital infrastructure to ensure technological sovereignty, or source it externally?
While the goal of “digital sovereignty” — ensuring Europe’s ability to act independently in the digital realm — is understandable, treating it as an ideological end-state risks undermining potential progress. A dogmatic pursuit of sovereignty may delay the tech advances that Europe seeks to secure. Digital pragmatism — a flexible, strategic approach that accelerates adoption while preserving future autonomy — presents the best path forward.
From cloud infrastructure to semiconductors, Europe remains dependent on non-European firms. The big three cloud hyperscalers are American: Amazon Web Services, Microsoft Azure, and Google Cloud. Together, they power an estimated 70% of European digital services, from e-commerce to critical infrastructure. To build out artificial intelligence “gigafactories,” Europe will need to buy semiconductors from two US suppliers, AMD and NVIDIA. No European alternatives exist.
Another motivation is fear. When President Donald Trump issued an executive order in February against chief prosecutor Karim Khan of the International Criminal Court (ICC) for investigating Israel for war crimes, allegations that Microsoft helped turn off Khan’s email account, stoked fears that the Trump administration would leverage America’s tech dominance to pull “kill switches” on European allies. Microsoft President Brad Smith stated that the company’s actions “did not in any way involve the cessation of services to the ICC,” and both Microsoft and the ICC declined to further comment on the process that led to Khan’s email disconnection.
Some European leaders have cautioned that Europe’s reliance on American technologies and the US defense sector could leave the continent vulnerable to significant strategic dependencies. During the recent 2025 Digital Summit in Gdansk, 12 civil society non-profits called on Europe to launch a project that makes “bold, long-term investments in strategic digital infrastructure, tackles entrenched monopolies, and reorients its policies to put openness, interoperability, and democratic accountability.”
Yet without trusted American partners, Europe will find it hard to achieve digital sovereignty. Rather than shunning US firms, Europe should use them strategically to scale up secure cloud adoption and accelerate deployment. Trusted partners, not protectionism, are the foundation of robust and forward-looking digital sovereignty. A clean break is not only impractical; it would be counterproductive, delaying modernization and raising costs across the board.
Sector by sector, a pragmatic European digital strategy can emerge. In cloud computing, Europe can adopt a “trusted cloud” model — working with American hyperscalers under strict European data protection rules. In semiconductors, partnerships with Taiwan’s TSMC can be leveraged to build local fabs, as already underway in Germany.
Open-source models represent a key enabler. Projects such as Linux, Kubernetes, OpenStack, and Mozilla have allowed countries and firms to build secure, auditable systems without dependence on any one vendor. Europe can and should support investment in open-source tools for cloud orchestration, generative AI, and data analytics. These are not just lower-cost alternatives; they are building blocks of resilience. For AI, European startups can train on open-source models rather than proprietary US systems, provided infrastructure is accessible.
US cloud providers are rushing to reassure, moving to wall off European operations.
In his report on European competitiveness, former European Central Bank President Mario Draghi advocates the implementation of EU-wide sensitive data security policies for partnerships between private EU cloud providers and US hyperscalers. European companies will benefit from such a collaboration, given the scale and market presence of US partners. This would also allow European companies to access the latest US cloud technologies while preserving encryption and security.
Pragmatism is not free. Draghi has warned that Europe may need to invest up to €800 billion to catch up in digital and green technologies. This includes cloud infrastructure, semiconductor fabs, AI R&D, quantum computing, and secure communications. Importantly, fragmented national initiatives are sure to fall short. Instead, a comprehensive EU-wide commitment akin to China’s Digital Silk Road is necessary to anchor Europe’s digital ambitions.
Pragmatism also means being pragmatic about regulation. For instance, the adoption of a single market passporting regime for all EU-provided cloud services would rule out the possibility for EU member states to “gold-plate” protection requirements beyond the requirements of the GDPR and the AI Act.
Europe’s largest sovereign AI opportunity lies in building AI models. The success of China’s low-cost DeepSeek shows that the race to develop and deploy AI models is just beginning. Europe’s own Mistral’s Le Chat, OpenEuroLLM, and EuroLLM are active in developing AI models. All, importantly, preach open source.
The US has committed to massive public-private tech investment strategies, reinforced by the Trump Administration’s AI Action Plan and foreign investment, particularly from Gulf partners such as Saudi Arabia ($600 billion), the UAE ($1.4 trillion), and Qatar ($1.2 trillion). China has espoused a similar strategy. In addition to its ambitious Made in China 2025 plan, Beijing has also recently set up a government-backed fund that pledges to mobilize $138.01 billion to support technology startups.
To keep up, what Europe needs most is digital adoption and digital investment. Sovereignty will be the result of smart strategy — not its starting point. Pragmatism, not protectionism, will lead Europe to a secure, competitive digital future.
Bandwidth is CEPA’s online journal dedicated to advancing transatlantic cooperation on tech policy. All opinions expressed on Bandwidth are those of the author alone and may not represent those of the institutions they represent or the Center for European Policy Analysis. CEPA maintains a strict intellectual independence policy across all its projects and publications.
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