Europe’s ambitions to bolster semiconductor production through heavy government spending will not break its technological dependence on US cloud infrastructure and software giants, Forrester analysts warn. The continent remains far behind global leaders China and the US in a broad measure of tech sovereignty and faces challenges beyond manufacturing chips themselves.
- Europe can grow chip production but still depends on US cloud and software.
- US and China lead global technology sovereignty with wide gaps over Europe.
- Managing dependencies through partnerships and open tech seen as key.
What happened
Forrester’s first Global Sovereignty Forecast reveals that Europe’s efforts to boost semiconductor fabrication by investing billions in domestic manufacturing are unlikely to deliver full technological independence. While chip fabs are expected to increase significantly, Europe continues to lack major chip design companies and innovation comparable to US and Chinese giants like Nvidia and Qualcomm.
The research shows that European cloud markets remain dominated by US hyperscalers such as AWS, Microsoft Azure, and Google Cloud, controlling around 65 percent of the market. High energy costs and regulatory challenges hinder data center growth in Europe, further limiting sovereignty. Overall tech sovereignty scores for top European economies show minimal improvement through 2030, reflecting persistent dependence.
Why it matters
Technological sovereignty is critical amid ongoing geopolitical tensions, AI competition, and fragile semiconductor supply chains. Forrester’s index underscores how strategic dependencies on American and Chinese technology infrastructures create an uneven playing field and limit Europe’s ability to protect data, infrastructure, and autonomy.
Europe's ambitious European Chips Act aims for 20 percent of global semiconductor production by 2030 but Forrester projects only about 11.3 percent share due to simultaneous efforts by other regions. Without equivalent progress in software, cloud infrastructure, and AI ecosystems, Europe risks remaining a follower rather than a leader in advanced technology.
What to watch next
European policymakers and tech leaders will need to balance investment in hardware capabilities with strategic partnerships that manage unavoidable dependencies. Focusing on open technologies and durable alliances could help improve resilience even if full independence isn’t achievable soon.
Meanwhile, monitoring how US cloud providers develop and market their so-called 'sovereign cloud' offerings in Europe will be important. Although these clouds operate under separate governance regimes, ultimate control remains with American corporations, underscoring the challenges for European tech sovereignty beyond chip manufacturing.