The Next Phase of American AI Is a Make-It-Or-Break It Moment for the EU
Digital dependency vs. tech sovereignty
The launch of Facebook and Apple’s first iPhone release in the mid-00s cemented the point-of-no-return for US dominance over the global digital infrastructure. At that point, it became clear that none of its allied countries could compete. The design and functionality of the iPhone was superb, downloading apps in the App store was extremely convenient, and the adoption of American apps like Facebook, YouTube, Instagram, Snapchat, etc. was rapid and of obvious high value to users. Finally, the apps were free and the new digital services were provided on terms that were impossible for outsiders to compete with.
At no point, did other countries consider the fact that almost all of the new digital services they had access to were imported from the US. Why would they? The US was the leader of the free world and a reliable trading partner. What was good for us, was good for them, and vice versa. Unfortunately, as it would later turn out, the emerging Big Tech companies were not only used to make people’s lives better, but also to conduct mass-scale surveillance, political interference campaigns, and products were optimized for engagement, so young people in particular, preferred to socialize through screens and passively consume entertainment, instead of interacting with the world around them.
The public have known about these issues for about 10-15 years, but Facebook continues to attract more active users by the quarter, Big Tech dominance continues to grow, and young people continue to be detached from their lives as they favor infinite entertainment loops and artificial intimacy over building skills, knowledge, careers, and having relationships and children. Even though complaints about status quo are getting louder among citizens and governments alike, nothing changes meaningfully. The structural dependency and addiction to Big Tech products are undeniable, and right now, it’s hard to see how it could change.
The US dominance over the world’s digital infrastructure laid the foundation for AI. The abundance of data, dedicated global users, ad revenues, computing infrastructure, and wacko ideas from wealthy white guys in Silicon Valley had to lead somewhere. AI was depicted as the next hypergrowth market after failed attempts with crypto and the metaverse. The social media experiment was all about connecting everyone in the world to American infrastructure, while the AI experiment is all about discovering how much of human skill and knowledge can be automated on American infrastructure.
The next phase of AI will be marked by the upcoming and record-breaking IPOs of SpaceX (parent company of xAI), Anthropic, and OpenAI. The White House is currently exploring the option of taking equity stakes in leading AI companies. We are long past the initial proof-of-concept stage of AI. It’s now turning into a mature asset class, a powerful political tool, and a new way of promoting Pax Americana. Not supporting AI as an American at this stage is arguably unpatriotic, since the US economy hinges on a successful AI development at home and a widespread export to other countries with arms as open wide as when they received the iPhone and Facebook.
Simultaneously, the EU is waking up to the fact that it cannot dictate its digital market through regulation alone. The new ‘Tech Sovereignty Package’ seeks rapid digital independence “across each stage of the value chain, from chips, to infrastructure, to software, cloud and AI”. The proposal by the EU Commission is strongly worded. The opening (highlights not my own):
“The European Union stands at a defining moment to assert its technological sovereignty and reclaim its place in the global race for geoeconomic power. The Draghi Report highlighted the epochal challenge ahead: despite years of regulatory leadership and sustained investments, the EU remains structurally reliant on non-EU providers for over 80% of its digital products, services, infrastructure and intellectual property. As geopolitical fragmentation deepens and supply chains are increasingly weaponised, excessive technological dependencies in critical sectors are becoming strategic liabilities. This is even more the case as higher and rising energy costs in Europe are impairing its competitiveness, particularly in energy-intensive technologies like cloud or AI. The Union’s technological sovereignty and economic security will depend on staying ahead in critical technologies, lowering our exposure in terms of existing strategic dependencies, and avoiding new dependencies that third countries can weaponise. In a world of rapid technological acceleration and intensifying strategic rivalry, the EU thus faces the risk of a structural erosion of its industrial and technological base, unless it acts decisively to close its innovation gap. This requires a rapid shift of the EU’s posture from a reactive focus on resilience and risk mitigation to an assertive and proactive approach grounded in technological sovereignty
The question remains if the EU can act decisively and fast enough, or if OpenAI, Anthropic, Google, SpaceX et al. will continue to give the EU offers that are too good to refuse.
I know I talk a lot about the EU, but the EU is a big and strategically important market. If it cannot obtain digital sovereignty, I doubt that any country in the ‘free world’ can. In that case, we will have to endure a new epoch of strange implications, increased surveillance, mass-manipulation, and democratic and civil erosion, because of the digital infrastructure we rely upon.
I will continue to monitor the situation closely here on Futuristic Lawyer with occasional deeper analysis for paid subscribers.
