Europe must develop its own IT services

This article has been published on 20 August 2025 in iBestuur

Introduction. Europe currently accounts for about a quarter of Big Tech’s global revenue. The United States, with a smaller population, uses significantly more Big Tech services per capita. If Europe were to reach a similar per-person usage level as the US, the European IT market would more than double. Should Europe provide these services itself, it would create a vast internal market for European digital services, with the potential to expand globally.

It is often argued that Europe’s lag behind the US is too great to overcome. But that reasoning is flawed, and needlessly defeatist. Digital services are the utilities of the emerging digital society — the fluid society. Without a strong, independent IT service sector, Europe cannot survive economically or politically. Europe must therefore become more self-sufficient in several strategic areas of IT to avoid remaining in a position of long-term dependence. This is absolutely feasible: Europe still has excellent technical universities, a thriving start-up scene, and sufficient financial resources. This article explores which digital services Europe currently sources from US-based Big Tech firms and where opportunities lie for building its own capabilities.

1. Key areas of dependency.

The main categories of IT services in which Europe is heavily dependent on American providers include:

• Cloud infrastructure (AWS by Amazon, Microsoft Azure, Google Cloud): almost the entire European public sector and most businesses rely on American cloud providers.
• Operating systems and platforms (Windows, Android, iOS, macOS): virtually all end users depend on American ecosystems.
• Search engines and digital advertising (Google, Meta): the European digital ad economy is almost entirely controlled by US firms.
• Office productivity and collaboration tools (Microsoft 365, Google Workspace, Zoom): dominant across offices, schools, and governments.
• Online retail and logistics infrastructure (Amazon): a major player in e-commerce and related cloud, AI, and logistics platforms.
• AI models and LLMs (OpenAI, Anthropic, Google DeepMind): global leaders are US-based, with minimal European influence.

2. Why this is a problem?

• Data dependence: European user data is processed and monetised outside of Europe. Europe is missing the chance to extract knowledge from its own data for research and innovation.
• Loss of digital sovereignty: European governments and firms are dependent on foreign infrastructure and updates. In the event of political friction, the US could restrict or withdraw digital services.
• Legal leverage: Big Tech resists EU regulation. The US government has previously threatened to reduce services if Europe enforces stricter rules. Without its own IT ecosystem, Europe lacks bargaining power.
• Innovation leakage: AI, cloud and software investments generate returns elsewhere. European start-ups often relocate to the US due to a lack of suitable (ideally European) funding.
• Economic loss: hundreds of billions in revenue from digital services flow to the US. Given the ever-growing importance of the digital economy, failing to build strong domestic IT services is irresponsible.
• Strategic weakness: in a digital world, Europe cannot remain relevant without its own robust IT utility infrastructure — a foundational layer beneath society’s digital operations. A European “IT-Eurostack” must be built to gain greater self-sufficiency across all layers of IT — from raw materials to advanced applications.

3. Opportunities for Europe. Europe currently accounts for around 23% of Big Tech service consumption. The US accounts for 43%, and the rest of the world for about 35%. If Europe matched US per capita digital usage, its market would more than double. If those services were provided by European firms, Europe would be a global IT player in its own right.

Table 1 – Current Big Tech revenue (€1.3 trillion) and Europe’s share

Company/segment	Big Tech revenue (€ bn)	EU-revenue (€ bn)	% EU of total
Meta – Social Media	165	35	21,2
Alphabet (Google/YouTube) – Social Media / Ads	300	40	13,3
Alphabet – Cloud (Google Cloud)	30	10	33,3
Microsoft – Cloud (Azure)	75	20	26,7
Amazon – Cloud (AWS)	90	20	22,2
Apple – Consumenten diensten & hardware	400	125	31,2
Overige IT-diensten / restpost	275	55	20
Totaal	1335	305	22,8

As global digitalisation progresses, other world regions will catch up to current American usage levels. If global per capita IT spending reached €1,200 annually — lower than today’s US figure — then for 8 billion people we would be looking at a global IT service market worth €10 trillion annually. Big Tech currently earns about €1.3 trillion in digital services (excluding hardware), meaning growth is only just beginning. For context: global military spending is approximately €2 trillion/year, and total IT spending is estimated at €4–5 trillion/year.

Table 2 – Regional breakdown of Big Tech revenue and per capita spend per year

Region	Population (million)	Big Tech revenue region (€ bn)	IT-Spend per Person per year (€)
Verenigde Staten	350	580	1657,14
Europa	500	305	610
Azië–Pacific	2800	300	107,14
Latijns-Amerika + MENA + Afrika	2500	100	40
Overig / nauwelijks verbonden gebieden	1850	50	27,03
Totaal	8000	1335

4. What Europe must do. Given the urgency and scale of the challenge, Europe cannot afford to sit still. Key actions include:

• Build European cloud infrastructure: accelerate projects like Gaia-X and European data centres.
• Develop home-grown AI models: like Mistral (France) and Aleph Alpha (Germany); supported through public investment and university partnerships.
• Promote European operating systems and software: support open-source initiatives and European tech start-ups.
• Pair regulation with investment: strong digital laws (DMA, DSA) must be matched by large-scale funding in Europe’s digital sector.
• Form innovation clusters: emulate models like Airbus and CERN; establish pan-European platforms in key strategic areas.

5. Conclusion. Europe stands at a crossroads: either continue outsourcing its digital infrastructure and remain dependent on the US and Big Tech, or build a strong, sovereign IT sector. The scale, the talent, the market, and the capital are all here — what’s missing is political will, coordination, and the courage to act on a European level.

This is partly reflected in the Draghi Report. As previously argued, Europe must start building robust governance structures. A European Digital Council, bringing together national Ministers for Digital Affairs, should be created. Its primary task should be to launch strategic committees — including stakeholders from business and academia — to tackle key areas. Some projects already exist (e.g. Eurostack, Gaia-X), but high-level coordination and fiscal tools are still lacking to support the emergence of true European Big Tech firms — operating not nationally, but on a continental scale.