EU promotes plan to usurp US Big Tech with digital market
European Union is at an important point in its plan to build a single market and strengthen its cloud computing sector
Europe is about to make its prolonged effort to create a digital single market part of a grand plan to beat US big techs, govern global dataflows and revive its failed cloud computing industry.
This is an urgent item on the agenda of the incoming European Union (EU) governing administration, after it conceded that since it cannot compete, it must change the rules of the game.
Officials and ministers of the EU laid out their plans last week, at a conference of business executives, public officials and technology experts who have been trying to build what has been earmarked as the bedrock of Europe’s proposed digital single market. It will now become the technological basis for imagined European cloud and artificial intelligence (AI) industries as well.
But 10 years since Germany’s Economy Ministry conceived the scheme, dubbed Gaia-X, it is still to achieve its aims – and officials, having decided it is the answer to all of Europe’s tech woes, are demanding it starts delivering.
Yet, as Gaia-X and a wide community of like-minded EU initiatives evolved into a plan to create dataspaces – computer systems that translate incompatible dataflows so they flow as freely as in real-world commerce – EU officials wrote it into ever bigger plans.
Its mandate has acquired legal and technical necessities that have become problems so intractable they have stalled progress on what was already criticised for not delivering on its plan. The European Commission (EC) has made Gaia-X its spearhead to build a global consensus to govern data exchange not only within national or regional markets, but in global cross-border dataflows as well.
Free-flowing dataflows need identity systems to vet the people behind them, and common laws to govern them – two things that are a source of intense and long-standing disagreement between nations, with numerous international forums trying to fix them.
Dataspaces
Dataspaces will nevertheless be ratified into the incoming EC plan for government when, as expected, the European Parliament approves it next week. Gaia-X will become a cornerstone of its plan to build a cloud computing industry to usurp dominant US tech firms, thwart Chinese tech ambitions, and then to build atop that a world-class AI industry. These are among the key elements of its grand plan to attain “digital sovereignty”.
Germany was putting its hope in Gaia-X to make the EU economy competitive by delivering on those grand plans. Robert Habeck, Germany’s economic minister, said in a video message streamed at an annual political summit the tech venture held in Helsinki last week: “Europe needs digital sovereignty. This is growing more urgent [with] the increasing importance of AI for European competitiveness. What we have achieved is remarkable, but expectations remain high.”
Europe needs digital sovereignty. This is growing more urgent with the increasing importance of AI for European competitiveness. What we have achieved is remarkable, but expectations remain high Robert Habeck, Germany’s economic minister
Gaia-X’s dataspace technology was bringing a “paradigm shift”, from centralised big tech computing to a federated system, he said. Habeck outlined the EU plan to revive its tech industry, not by building behemoths comparable with industrial giants like its own Volkswagen and Airbus, or big US tech firms like Microsoft and Google, but by unifying Europe’s fragmented cloud computing firms into a single, collective, state-backed computer system, cobbled together by common data standards and software. As such, a problem that computer scientists have been trying to solve for decades – a universal data connector – is to become EU policy.
Commenting on the vast body of legislation the outgoing commission implemented under its controversial digital strategy, Mark Ferracci, French minister delegate for industry, said in another video message: “These new regulations will have no real impact without the strong mobilisation of the ecosystem of which Gaia-X is the driving force.”
Now or never
The EU now relies on Gaia-X to sow its regulatory model in global industry groups, where firms have been trying to overcome technical and legal barriers that have stopped them from modernising dataflows in supply chains that include foreign firms. That is something that Gaia-X and its offshoots in vertical sectors, such as automotive and manufacturing, have been doing. EU officials have called for it to be speeded up.
Europe’s model of data governance will fail if it cannot work across borders. Global collaboration, and Gaia establishing that, is critical to Europe’s vision, said Ferracci. And its scheme to build a federated single market and cloud and AI system on dataspace technology will fail if European firms don’t use it.
In the B2B arena, we have a good chance to play a real part in the global game of digitisation, based on European values and created here, in an EU ecosystem Ulrich Ahle, Gaia-X
“Very worrying” geopolitical developments had made Gaia-X a more important part of the incoming commission’s digital sovereignty plans, Pearse O’Donohue, director of Future Networks at the EC, told summit delegates. Europe needed to build a native computer infrastructure that would operate if events turned sour. Its plan to build this out of dataspaces was “now a key part of our AI strategy” and “critical for EU competitiveness [and] the entire EU economy”.
“This is a now‑or‑never moment. Technological leadership is crucial for our competitiveness. It’s important for our sovereignty that we have our own capacity when it comes to cloud services,” she told MEPs.
Officials repeatedly urged delegates at the conference to hurry up and deliver. Lulu Ranne, minister of transport and communications in Finland, and compatriot of Virkkunen, said it was about time the EU stopped being a competitive laggard. “Results. That’s what we need,” she said. “Not just dreams and plans, but concrete solutions.”
Ernst Stockl-Pukall, head of digital policy at the German Economy Ministry, said it would take years yet to finish the job. “It will be impossible to copy the hyperscalers,” he said, referring to the big US cloud firms often lamented at the summit. “They are much too strong.”
It would take too much money, he said. “We [need] something new. We have to leapfrog. That’s where Gaia-X comes in. Now is the time to go all-in on digital sovereignty.”
Answering criticism that the dataspace scheme was vapourware, Gaia-X CEO Ulrich Ahle insisted its preparatory designs were complete and it was now focused on delivery.
“As Europeans, we lost the battle on B2C to the hyperscalers, but we are convinced that in the B2B arena, we have a good chance to play a real part in the global game of digitisation, based on European values and created here, in an EU ecosystem,” he said.
