Looming over the internet lasers and firestarting phones firms have been touting at Mobile World Congress in Barcelona this month, was a extra nebulous however a lot bigger announcement: a pan-European cloud known as EURO-3C.
EURO-3C’s backers – Spanish telecoms large Telefónica, dozens of different European firms, and the European Commission (EC) – intention to fill a spot. U.S.-based cloud giants dominate within the EU, and European policymakers need their rising portfolio of digital authorities companies on a “sovereign cloud” beneath full EU management.
However the EU lacks an actual equal to the likes of AWS or Microsoft Azure. Certainly, any effort to construct one will inevitably run up in opposition to the identical U.S. cloud giants.
Simply 4 U.S.-based hyperscalers – AWS, Microsoft Azure, Google Cloud, and IBM Cloud – collectively account for some 70 percent of EU cloud services. That is even supposing the 2018 U.S. CLOUD Act permits U.S. federal law enforcement – at the very least in principle – to compel U.S.-based companies handy over information that’s saved overseas.
However these hypothetical dangers to digital companies have grow to be extra actual as transatlantic relations have soured beneath the second Trump administration. The U.S. has openly threatened to invade an EU member state and sanctioned a European Commissioner for passing legislation the White House dislikes.
After the White Home sanctioned the Netherlands-based Worldwide Felony Court docket in February 2025, Court docket staffers claimed Microsoft locked the Court docket’s chief prosecutor out of his electronic mail (Microsoft has denied this). Across the similar time, the U.S. reportedly threatened to sever EU ally Ukraine’s entry to essential Starlink satellite internet as leverage throughout commerce negotiations.
“The geopolitical threat isn’t simply essentially the most excessive type of a doomsday ‘kill swap’ the place Washington turns off Europe’s web,” Stéfane Fermigier of EuroStack, an business group that helps European digital independence. “It’s the selective degradation of companies and a complete lack of retaliatory leverage.”
What, then, is the EU to do? France presents an instance. Even earlier than 2025, France carried out harsh restrictions on non-EU cloud suppliers in public companies – suppliers should find information within the EU, depend on EU-based workers, and should not have majority-non-EU shareholders. Now, EU policymakers are following France’s lead.
In October 2025, the EC issued a two-part framework for judging cloud suppliers bidding for public sector contracts. Within the first half, the framework lays out a form of sovereignty ladder. The extra {that a} supplier is topic to EU regulation, the upper its sovereignty degree on this ladder. Any potential bidder should first meet a sure degree, relying on the tender.
Qualifying bidders then transfer to the second half, the place their “sovereignty” is scored in additional element. Utilizing an excessive amount of proprietary software program; over-relying on provide chains from outdoors the EU; having non-EU assist workers; liability to non-EU legal guidelines just like the CLOUD Act: all damage a bidder’s rating.
The framework was created for one tender, however observers say it units a serious precedent. Cloud suppliers bidding for state contracts throughout Europe could must observe it, and it could affect laws on each nationwide and EU-wide ranges.
Who, then, will obtain excessive marks? In the mean time, the reply isn’t easy. The EU cloud scene is kind of fragmented. Quite a few modest EU suppliers supply “sovereign cloud” companies – reminiscent of Scaleway, OVHcloud, and Deutsche Telekom’s T-Methods – however none are on the scale of AWS or Google Cloud.
Inertia is on the facet of the U.S. cloud giants, who can spend money on their infrastructure and companies on a far grander scale than their European counterparts. Some U.S. suppliers now offer cloud companies they are saying adjust to the Fee’s “cloud sovereignty” calls for.
Some European observers, like EuroStack, say such guarantees are hole as long as a supplier’s guardian firm is topic to the likes of the CLOUD Act, and loopholes within the Fee’s course of stay open. An AWS spokesperson informed Spectrum it had not disclosed any non-US enterprise or authorities information to the U.S. authorities beneath the CLOUD Act; a Google spokesperson mentioned that its most delicate EU choices “are topic to native legal guidelines, not US regulation”.
Even when a venture like EURO-3C can supply a large-scale different, the US cloud giants have one other form of inertia. Many builders – and lots of public purchasers of their companies – will want convincing to go away behind a well-recognized surroundings.
“If you happen to take a look at AWS, you take a look at Google, they’ve created some tremendous know-how. It’s very handy, it’s straightforward to make use of,” says Arnold Juffer, CEO of the Netherlands-based cloud supplier Nebul. “When you’re in that platform, in that ecosystem, it’s very exhausting to get out.”
Martyna Chmura, an analyst on the Bloomsbury Intelligence and Safety Institute, a London-based suppose tank, sees some EU builders taking a combined strategy. “Many organizations are already transferring towards multi-cloud setups, utilizing European or sovereign suppliers for delicate workloads whereas nonetheless counting on hyperscalers for sure companies,” she says.
In that case, the EU’s top-down calls for could encourage builders to make use of EU suppliers for delicate purposes – like authorities companies, transport, autonomous vehicles, and a few industrial automation – even when it’s inconvenient within the brief time period, or if it causes much more fragmentation of the EU cloud scene. “Operating methods throughout totally different platforms can improve integration prices and make safety and information governance extra difficult. In some instances, organisations may lose among the effectivity and value benefits that come from utilizing giant hyperscale platforms,” Chmura says.
“Total, the EU seems keen to just accept a few of these trade-offs,” Chmura says.
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