Europe’s Tech Sovereignty: A Race Against Time
BARCELONA, March 3, 2026 – Europe’s ambition to achieve “technological sovereignty” faces significant hurdles, according to leading telecom executives at Mobile World Congress (MWC) this week. The consensus: faster regulation, government investment, and industry consolidation are critical to competing with the United States and China.
The Investment Gap and Regulatory Lag
Deutsche Telekom CEO Tim Hoettges highlighted a concerning trend: the European telecom industry experienced a 2 percent decrease in investment last year. This contrasts sharply with the growth seen in other global markets. Hoettges criticized the European Commission’s proposed Digital Networks Act (DNA), arguing it won’t deliver the promised investment and has actually increased bureaucratic tasks for regulators.
The debate extends beyond mobile and fixed networks, encompassing cloud computing, artificial intelligence, and the crucial semiconductor industry. Europe remains heavily reliant on non-European suppliers in these key areas.
AI at the Forefront, But Regulation Struggles to Keep Pace
Telefónica CEO Marc Murtra emphasized the need for scale, pro-technology regulation, and speed. He pointed out that the rapid pace of AI development – with products evolving every three months – far outstrips the current regulatory framework, which he described as “already fifteen-years” antiquated.
Telefónica is proactively adapting by shedding obsolete technologies and restructuring to embrace calculated risk and future skills.
Satellite Constellations: A Concrete Sovereignty Project
One area where Europe is making tangible progress is in satellite technology. Eutelsat CEO Jean-François Fallacher showcased the OneWeb constellation – the only operational system not based in the US or China – which operates approximately 650 satellites. Recent shareholder investment of €1.5 billion ($1.7 billion) has enabled an order for an additional 440 satellites from Airbus.
Eutelsat’s OneWeb is experiencing 60 percent year-over-year growth and generating over €200 million in revenue, representing 20 percent of Eutelsat’s total turnover. The EU’s IRIS² project, a secure connectivity constellation, represents a long-term commitment to sovereignty, with government contracts already secured.
Fragmentation and the Need for Consolidation
Hoettges underscored Europe’s structural disadvantage: fragmentation. The continent’s telecom market is divided by national boundaries, hindering synchronized deployment of software and hardware. He argued that Europe’s antitrust approach discourages consolidation, while capital markets fail to reward mergers.
Deutsche Telekom is addressing this by launching an “AI industrial cloud” in Munich, powered by 10,000 Graphical Processing Units (GPUs), with potential scalability to 20,000. However, the cloud relies on Nvidia GPUs due to the current lack of European alternatives at that scale.
A key missing element, Hoettges stated, is government commitment as an “anchor tenant,” prioritizing domestic facilities for workloads like health and defense.
The Chinese Equipment Debate
Discussion similarly touched upon the EU’s initiative to phase out high-risk telecom suppliers, targeting Chinese equipment. Some industry figures view this as counterproductive, potentially diverting capital from new network investments. Concerns were raised about the lack of cost-benefit analysis and the missed opportunity to modernize regulations to support differentiated service offerings.
Eutelsat faced restrictions from French authorities preventing the sale of its earth station network, highlighting the strategic importance governments place on this infrastructure.
FAQ
Q: What is “technological sovereignty”?
A: It refers to a nation’s ability to independently develop and control its own critical technologies, reducing reliance on foreign suppliers.
Q: What is the Digital Networks Act (DNA)?
A: A proposed EU regulation aimed at modernizing and harmonizing telecom rules.
Q: What is the IRIS² project?
A: The European Union’s planned secure connectivity constellation, designed to enhance Europe’s satellite capabilities.
Q: Why is consolidation important for European telecom operators?
A: Consolidation allows operators to achieve economies of scale, invest in new technologies, and compete more effectively on a global stage.
Did you know? The OneWeb satellite constellation is growing rapidly, with plans to expand to over 1,000 satellites in the coming years.
Pro Tip: Keep an eye on the development of the European Chips Act, as it will play a crucial role in strengthening Europe’s semiconductor industry.
What are your thoughts on Europe’s tech sovereignty ambitions? Share your insights in the comments below!
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