A recent paper by a tech lobby group claimed that creating a European tech stack would cost “over €5 trillion,” a figure based on the historical R&D and infrastructure spending of Alphabet, Amazon, Apple, Meta, Microsoft, and Nvidia. This is an astonishingly disingenuous calculation — and fundamentally misleading.

No one suggests replicating the entirety of Big Tech’s offerings or their global infrastructure footprint. Rather, the aim is to strategically invest in critical parts of the digital value chain where sovereignty, resilience, and competitiveness are at stake. Europe already has significant capacities across the board, for example in chip lithography, open-source software, secure connectivity, and HPCs. What’s lacking is integration, scale, and strategic coordination.

Estimates by think tanks such as CEPS place the realistic public investment need at around €300 billion over the next decade, equivalent to around 1.6% of the EU’s GDP annually. Even this number is likely an overestimation, given the enormous amount of public money spent annually on the procurement of non-European Tech. A redirection of these funds would cost little and give a massive boost to European innovators.

Besides these necessary strategic investments to shift away from non-EU technology, European providers already offer competitive pricing and better alignment with local requirements. The assumption of higher costs is often driven by bundling practices, opaque pricing models, and entrenched procurement defaults. Where like-for-like evaluations are carried out, the cost argument frequently collapses.

Finally, what is rarely acknowledged by opponents of digital sovereignty is the financial cost of inaction. Europe’s current dependency model results in structural outflows — in licensing, data extraction, egress fees, and intellectual property flight — that add up to a hidden but massive “dependency tax.” As the Cigref/Asterès report estimates, this tax costs European businesses over €260 billion annually – a steady drain of capital that undermines our industrial base and erodes long-term competitiveness, not to mention the accumulating risks to security, privacy, and democratic accountability.

Opponents argue that the idea of building a sovereign European tech stack smacks of protectionism, threatening open markets and competition. This critique is both ideologically rigid and empirically false.

Let’s be clear: this is not about closing Europe’s digital market. It is not about blocking foreign investment, nor about banning the use of non-European tech. It is about restoring competitive conditions by ending structural lock-in and ensuring European businesses and public authorities have genuine alternatives.

Currently, a handful of non-European hyperscalers dominate cloud, AI, and digital infrastructure markets in Europe. These actors benefit from unfair market advantages: vast scale, regulatory arbitrage, avoidance of taxation, and aggressive acquisition of local competitors. The result? European tech firms — especially SMEs — are left to compete in a market shaped by private oligopolies masquerading as open competition.

What proponents of tech sovereignty advocate for is a level playing field: enabling interoperability, breaking up artificial switching costs, and incentivising procurement that favours open, European solutions. The goal is diversification, not isolation. It is the opposite of protectionism: it is about ending monopolistic capture and restoring user choice.

This myth is rooted in the widespread underestimation of Europe’s tech capabilities. It is often claimed that because Europe lacks its own hyperscalers, it cannot build sovereign alternatives. But this ignores both Europe’s existing industrial assets and its proven ability to lead when the incentives align.

Europe is not a digital desert. It is home to world-leading companies in semiconductors, secure networking, open-source communities, and a flourishing quantum and HPC research scene. Moreover, European research institutes and SMEs are behind cutting-edge developments in cryptography, applied AI, and decentralised computing.

What has been missing is not talent or innovation but market conditions that support European players. By shifting demand — especially through public procurement and targeted investment — Europe can activate its dormant capacity. Demand creation is as important as supply development. Once the incentive structure changes, private investment and entrepreneurship will follow, and SMEs will be key to this revival.

This argument cloaks strategic fatalism in the language of realism. Yes, the global tech ecosystem is interdependent. No one advocates for full decoupling. But sovereignty does not mean autarky — it means having meaningful control and ownership over critical digital infrastructure and avoiding strategic dependency on actors whose incentives do not align with European values or interests.

As it stands, Europe is deeply and dangerously dependent on a narrow set of non-European providers. These actors hold the keys, literally, to Europe’s data, identity systems, AI services, and even elements of public infrastructure. In some cases, they have the power to unilaterally disable services, dictate terms, or mine data in ways incompatible with EU law and values.

And this is not a hypothetical risk. According to recent reports, Microsoft blocked the ICC prosecutor’s email after the U.S. imposed sanctions in response to investigations targeting Israeli officials. Furthermore, platforms like X and TikTok, but also Meta’s Instagram and Facebook, play an outsized role in shaping European political discourse, with little transparency and significant capacity to amplify anti-democratic narratives, as the example of the Romanian presidential elections shows.

Sovereignty, in this context, means being able to set the rules, own the infrastructure, and innovate on our terms. It means building redundancy, supporting open standards, and having domestic capacity at critical layers, especially compute, cloud, data governance, and connectivity. Sovereignty is not a retreat from global cooperation but the precondition for fair and voluntary participation in the global digital economy.

Some critics see projects like the EuroStack tailored to the interests of large incumbents — especially telecom giants — with little value for smaller players. But this overlooks how the European model of digital infrastructure is structured and who it depends on to work.

Our idea of tech sovereignty is designed around federation and interoperability. This architecture creates space for a wide range of providers to plug into the system: not just national champions, but also regional and niche players. Many of the services that make infrastructure usable in practice — from collaboration tools and secure email to sector-specific AI — are already delivered by SMEs. These are not peripheral add-ons; they are essential components of the stack.

SMEs also benefit as users. When infrastructure layers like cloud, operating systems, app stores, and search are open and governed to prevent extractive behaviour, smaller firms are free to build without relying on gatekeepers. Public-sector involvement in shaping this environment helps ensure it serves broader economic and social goals instead of the profit margins of dominant platforms.

In short, investing in sovereign tech infrastructure lowers the barriers to entry for SMEs on both sides: as providers whose solutions are aggregated into the stack layers, and as innovators who depend on open infrastructure to grow on fair terms.

A growing narrative suggests that Europe should concede certain domains of the tech stack — especially foundational layers like cloud infrastructure or large AI models — to non-European firms. The argument goes: the race is over, the US and China have won, and Europe should stick to applications or niche sectors where it already has a lead. This view is not only fatalistic, it is also a strategic mistake.

Take AI as an example. Critics often argue that Europe shouldn’t “waste” resources on building its own frontier models and should instead focus on applying US- or Chinese-made systems. But this logic cedes long-term control over how these models can be used. Whoever builds and governs the infrastructure — whether in AI, cloud, or chips — sets the rules for how applications are built, how data is used, and who captures the value.

Accepting a permanent dependency at the infrastructure level amounts to industrial disarmament. It’s the digital equivalent of France or Germany choosing to become users and distributors of steam engines during the Industrial Revolution instead of improving on it and manufacturing their own. No serious industrial power ever thrived by giving up on strategic layers of innovation.

Moreover, the idea that these markets are already “lost” ignores how quickly digital leadership can shift. A decade ago, many of today’s dominant AI players didn’t exist. Technological change is constant, and dominance is sustained less by superior technology than by control of data, infrastructure, and ecosystems. That’s precisely why conscious public investment, open governance, and structural decoupling matter.

Europe still has the chance — and the obligation — to shape the next wave of digital infrastructure. Focusing narrowly on downstream applications while remaining dependent on foreign infrastructure replicates the same asymmetries that Europe is trying to escape. Building sovereignty means engaging across the full stack, even in areas where the ground is harder.

A common criticism holds that building a sovereign European tech stack would isolate the EU from its allies, undermine cooperation, and contradict the openness Europe advocates in international forums. According to this view, the sovereignty agenda resembles digital nationalism — a “Make Europe Great Again” reflex — that risks alienating like-minded partners and weakening Europe’s influence in global affairs.

This argument misunderstands the reality of Europe’s position. The current model of tech interdependence is not balanced. Currently, Europe enters digital partnerships from a position of structural dependency. Our cloud infrastructure, operating systems, app stores, and compute layers are largely controlled by non-European actors. In such a position, Europe’s ability to set terms, defend its values, or negotiate fair standards is inherently constrained.

A sovereign digital foundation does not close doors — it opens them from a position of strength. It enables Europe to engage with partners like Japan, India, and South Korea not as a consumer of foreign technology, but as a peer with something to offer. It also equips the EU to act as a genuine “third way” in global tech governance — an alternative to both laissez-faire deregulation and authoritarian digital control.

Rather than isolating Europe, digital sovereignty strengthens its voice in shaping the global digital order. A dependent Europe cannot lead. A sovereign Europe can.

Europe has long excelled at regulating digital markets, but regulation alone cannot produce industrial strength. Europe’s strategy must now shift to building and governing capacity.

Digital sovereignty is the only way to ensure that Europe’s citizens, businesses, and especially its SMEs can thrive in a digital future defined not by extraction and dependency, but by autonomy, innovation, and trust.

This is not about competing with Silicon Valley on its own terms. It is about creating a European model of digital infrastructure: one that embeds openness, democratic control, and industrial strength in a coherent whole. The time for hesitation is over. The time to build is now.