Digital sovereignty is on everyone’s lips amid heightened geopolitical tensions and national security concerns. For Europe, this includes regulatory and security tension with the United States, as well as reducing reliance on China and fear of cybersecurity attacks from Russia.
As such, European policymakers are doubling down on the importance of tech sovereignty, with Gartner predicting more than 75% of all enterprises outside of the US will have a digital sovereignty strategy by 2030.
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Director of Research, Tech, Media & Telecom at AlphaSense.
Recent analysis has found the corporate reality for tech independence to look quite different. After examining two years of European boardroom transcripts in AlphaSense, we tracked how often senior leaders referenced major technology providers to test whether growing geopolitical tensions is shifting how companies think about their reliance on US tech.
Across the period analyzed, Microsoft was referenced over 19,000 times in European boardrooms, far more than any other company and well ahead of both AWS (5,953) and leading European players such as SAP (11,932) and Siemens (11,534).
The gap underscores how deeply embedded US platforms remain in day-to-day European business operations, despite louder political calls to diversify.
Why digital sovereignty has suddenly turned into a business priority
With the rise of agentic AI alongside ongoing geopolitical volatility, sovereignty has quickly evolved from a political buzzword to a necessity for businesses. Control over core technologies is now viewed as essential for long-term competitiveness and isn’t just about where data is geographically housed.
Recent volatility has seen geopolitical tensions peak and the AI arms race supercharge technological competition to an all-time high. The combination of these two catalysts has alarmed the increasingly fragmented world we live in.
Business leaders and policymakers are seeing digital sovereignty as the means to mitigate geopolitical risks, avoid the over-concentration of a few big vendors and ensure that AI driven transformations remain under an organization or nation’s direct authority. Sovereignty is seen as an architectural requirement for AI and enterprise decision making, particularly in Europe, with a laser focus on trust and transparency.
Unsurprisingly, economic competition is also a key driver, with access to advanced AI and cloud solutions estimated to drive €1.2 trillion in GDP growth for the EU over the next decade. However, this could all collapse by two-thirds if industries are restricted by a lack of sovereign, high performance infrastructure.
As a result, 52% of organizations plan to invest in sovereign cloud and 42% in sovereign AI within the next two years, mainly for those in the aerospace, defense, banking, and insurance sectors.
The difficulties of implementation
But implementation isn’t straightforward. US Big Tech is embedded in the backbone of most companies and sovereign digital tools come at a price. Rigorous compliance adds cost and complexity, “buy-local” rules are depriving innovators of world-class platforms and local players have struggled to compete with a handful of the Big Tech leaders.
To achieve this, Europe would need to begin building its own digital stack, something we are starting to see with the introduction of the European Chips Act, set to double Europe’s share of global semiconductor production and secure supply chains for critical hardware. Similarly, the proposed Cloud and AI Development Act has the aim of boosting data center capacity and creating a secure, competitive European ecosystem for scaling AI.
There is still a long way to go, with local providers’ combined share fell from 29% to 15% between 2017 and 2024 whereas three US-based hyperscalers now account for about 70% of demand. There is a similar trend in AI tools, where the largest investments are concentrated in a few, very large data centers owned by a handful of corporations headquartered in the United States or China.
Intent is one thing, but the practicality for European businesses to break away from US tech, without compromising on competitiveness, is quite another. By developing the EURO-3C project, a €75 million federated network of over 70 edge and cloud nodes across 13 countries, Europe could prove out alternative infrastructure capabilities.
A more pragmatic path to sovereignty
With calls for digital sovereignty becoming more urgent, the debate must move beyond absolutism. Total decoupling from US hyperscalers is neither realistic nor economically rational. The data shows that Europe’s dependency is structural, which means untangling would take years, not months, with huge amounts of investment needed, assuming they are capable of building alternatives.
Sovereignty does not have to mean total isolation. Instead, layered sovereignty offers a more viable approach. This means retaining access to global platforms that deliver competitive advantage while building strategic control over the most sensitive layers of the stack, like data governance, AI model oversight and critical infrastructure.
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