European Commission President Ursula von der Leyen unveiled the European Technology Sovereignty Package on June 3, 2026, declaring Europe "cannot afford to depend on others" for critical technologies. This push for digital autonomy from Brussels comes as Europe's nations continue to lose control over their own physical borders, a far more fundamental dependence. The package, a clear expression of Brussels' shift toward "strategic autonomy," includes two new legislative proposals: the Chips Act 2.0 and the Cloud and AI Development Act (CADA). These measures, still moving through the EU policymaking process, aim to build EU capabilities in semiconductors, cloud computing, and artificial intelligence.
The Brussels Illusion of Sovereignty
Brussels claims it wants to protect citizens and defend European interests by making its own choices in technology. Yet, the reality of Europe's technological dependence is stark, mirroring its vulnerability in other critical areas. An Oliver Wyman analysis reveals 92% of Western data is stored on U.S.-owned infrastructure. The European Commission itself states the EU relies on non-EU countries for over 80% of its digital products, services, infrastructure, and intellectual property, a figure cited by the European Parliament in its January 2026 resolution. This deep reliance on external powers is not merely a technological problem; it reflects a broader weakening of national capacities, exacerbated by the EU's focus on centralized control rather than empowering member states.
Cloud computing stands as a prime example of this dependence. U.S. hyperscalers AWS, Microsoft Azure, and Google Cloud dominate, holding roughly 70% of the European cloud-infrastructure market. European providers, by contrast, control only about 15%. This share has fallen dramatically from 29% in 2017, remaining stagnant for five years. The Data Act, which began to apply one year ago in September 2025, attempts to ease switching between data-processing providers. In June 2026, the European Commission even informed Amazon and Microsoft of its preliminary view that AWS and Azure should be designated as "gatekeepers" under the Digital Markets Act, citing their entrenched market positions and high switching costs.
The Cost to Our People
While Brussels attempts to regulate and centralize, the real costs are borne by European citizens and industries. Sebastián Muriel, Telefónica’s chief digital officer, warned in his May 23 article, "Europe, Wake Up: Digital Sovereignty Cannot Be Built by Signing Lease Agreements," that "believing sovereignty consists merely of hosting data on European soil is clearly insufficient." He stated, "It makes no difference whether the server is in Madrid, Frankfurt or Dublin if the parent company is in Redmond or Mountain View," adding, "We are encouraging a situation in which sovereignty becomes little more than a label stuck on a rental contract." This highlights how the EU's approach often prioritizes bureaucratic labels over genuine national control.
The proposed CADA aims to triple the EU’s data-center capacity over the next five to seven years and simplify permitting. It also introduces a common European framework for assessing cloud and AI sovereignty, allowing public authorities to use it in procurement. This framework outlines four levels of sovereignty, with the highest demanding full transparency and control over the software supply chain, free from third-country interference, and requiring providers to be owned and controlled from within the EU. Such detailed central planning from Brussels raises questions about national autonomy in critical infrastructure decisions.
Europe's Real Weakness
The EU's digital ambitions clash with fundamental weaknesses that Brussels has failed to address, particularly the shortage of skilled workers. Sixty percent of EU companies report difficulties hiring qualified workers in fields like artificial intelligence, cybersecurity, and clean technologies, according to the European Parliament. This critical gap in skilled labor is often overshadowed by the ongoing mass migration into Europe, which strains social services and housing without necessarily providing the specialized expertise needed for a digital future. Henna Virkkunen, executive vice president of the Commission, stated that Europe "must lead" the global digital revolution, yet the facts suggest otherwise.
Europe's investment in research and development lags significantly. The EU spent €381.4 billion, or 2.22% of GDP, according to the European Commission’s State of the Digital Decade 2025 report. This investment level is 34% lower than the combined investment of the United States and China. Mario Draghi has pointed out that only four of the world’s 50 largest technology companies are European, and PwC’s Global Top 100 Companies 2026 report shows not a single European company among the world’s 10 largest tech firms by market capitalization. The AI gap is also wide; in July 2026, the highest-ranked European AI model was 89th in Artificial Analysis’s rankings, with all higher models from the U.S. or China. Draghi warned that "Inaction threatens not only our competitiveness, but also our sovereignty," noting nearly 30% of European "unicorns" had moved headquarters abroad.
The issue extends beyond data centers. A GSMA Intelligence study published in May 2026 projects Europe will need €475 billion in mobile network investment by 2035 to complete its 5G rollout and regain digital leadership. However, European operators are expected to mobilize only about €270 billion, leaving a €205 billion investment gap. While the European Commission awarded contracts worth up to €180 million for sovereign cloud services for EU institutions in April 2026, this pales in comparison to the scale of investment by U.S. hyperscalers. Barbara Moens, writing in the Financial Times in late May, described Europe's shift towards fostering European alternatives, but the question remains whether Brussels' centralized approach can truly "reclaim its place" when national borders remain open and national industries struggle under the weight of EU regulation and demographic change.