Europe is overwhelmingly dependent on a handful of US tech companies that provide the EU with a large share of its digital infrastructure and services. The EU imported more than €300 billion in digital services from the US in 2025, up from around €200 billion in 2016. Among other things, around 80% of EU corporate spending on software and cloud services flows to US vendors. Amazon, Microsoft and Google occupy almost 70% of the European cloud market.

US Big Tech’s dominance partly reflects digital markets’ tendency towards concentration, driven by self-reinforcing network effects and customer lock-in. Big Tech companies have leveraged these effects, existing customer bases, and tactics like bundling tools and hardware to dominate digital markets.

What Dependency Costs

The dependency on US Big Tech comes at a cost for Europe. As the US becomes a less predictable ally, the security risks are becoming clear. Where Big Tech runs essential digital infrastructure or handles sensitive data, the US government could in principle demand access or hold a “kill switch” – the ability to cut off essential services.

That same dominance also makes it harder for European competitors to emerge and gives Big Tech real discursive power over what information is seen. Big Tech’s economic weight, increasingly entwined with US state power, can let it sidestep rules that apply to other market actors. This undermines democratic institutions’ ability to exercise oversight over these companies.

Rules Without Teeth

The EU has recognized these risks and made digital sovereignty a top priority. Initiatives like the Tech Sovereignty package presented in June are designed to build European autonomy in Cloud and AI development.

The EU has also built an extensive rulebook: the Digital Markets Act (DMA) and Digital Services Act (DSA), in force since February 2024, specifically target the power of large online platforms and gatekeepers, complementing slow ex-post antitrust proceedings with clear ex-ante obligations meant to make digital markets more contestable and restrict problematic conduct.

Yet these regulations have been only modestly successful so far. The exact impact is hard to measure, but little in the data points to changing market dynamics. No serious competitors to Big Tech have emerged since the DMA came into force. And a recent study shows that Europe has become more, not less, digitally dependent since 2010.

At most, the DMA has made markets formally more contestable, for instance on consumer choice and interoperability. The DSA has also given users more rights on paper, but concerns over the protection of minors, addictive design and data protection persist.

Part of why the EU’s interventions have been largely ineffective could be that Big Tech companies have been pursuing a strategy of minimal compliance: conceding small adjustments while resisting anything that would weaken their underlying business model.

This practice has also been labelled “malicious compliance”. Apple, for instance, adjusted its terms to meet the DMA’s “anti-steering” obligations, which require letting customers point users to cheaper offers, but did so in such a restrictive way that consumers and business customers did not benefit from the change.

Platforms have also obstructed the DSA’s application, including by delaying procedures and providing incomplete data in response to researchers’ requests. The result: an appearance of compliance, with no real change underneath.

Weaknesses in the EU’s enforcement structure enable this strategy. The Trump administration has turned Europe’s digital regulation into a bargaining chip in trade talks, threatening retaliation if American companies are fined.

According to reports, the Commission has delayed decisions on several occasions, undermining a core reason the DMA was passed: letting regulators react quickly. Bowing to political pressure also costs the Commission credibility as an independent enforcer.

On data protection, the Irish authority is the lead regulator in the EU for these companies. It has been criticized for close ties to tech companies and underenforcement of EU data protection rules for years.

Three Ways to Add Bite

If the EU wants to reduce its dependence on US Big Tech, its regulatory interventions need more bite, or American firms will likely keep dominating digital markets and shaping technological developments. Even if EU countries replaced foreign providers for the riskiest services, they would remain dependent on US companies for the rest, with no real control over how those services are provided, and at a cost to Europe’s competitiveness and democratic principles.

To change that trajectory, there are three areas for action:

  • First, market dominance and structural competition problems on digital markets need to be addressed more directly. To level the playing field, structural remedies, stricter merger control and fair taxation for big tech companies are necessary.
  • Second, the EU must ensure that Big Tech substantively complies with its laws when providing services here – behavioral obligations must be implemented swiftly and substantively. The EU has the power to issue interim measures and higher fines if necessary.
  • Third, enforcement gaps must be closed. A good first step would be ensuring enforcement agencies have sufficient resources and better coordination between them. The concentration of economic, social and political power now sitting with a handful of private companies likely exceeds that in other industries – a scale the EU’s response needs to match.

Europe’s digital sovereignty will depend on whether it can build credible European alternatives. Without contestable digital markets, however, it will be hard for European companies to attract the massive investment necessary.

That will require an ambitious regulator willing to withstand the inevitable backlash. The EU is not entirely powerless, though. Big Tech companies need the European market of 450 million wealthy consumers, and the US economy needs its Big Tech companies. The EU should use the leverage it has to take control of its digital future, build European alternatives and hold US Big Tech accountable.