Europe is significantly investing in AI development and infrastructure. Cloud platforms and GPU-as-a-service (GPUaaS) providers rapidly expand GPU (graphics processing units) access, serving as crucial facilitators for AI development and deployment.
The basic premise is simple: by scaling compute, you enhance capability.
Yet, despite the efforts of EU Member States, with initiatives like sovereign cloud projects and federated data infrastructure, Europe’s AI sector is limited by a key bottleneck: reliance on GPUs mostly crafted by non-European companies like NVIDIA, produced by Asian foundries, chiefly Taiwan’s TSMC, making chip independence unattainable for Europe in the short term.
This affects European technological sovereignty directly.
The computer boom
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The semiconductor industry is flourishing structurally, propelled by the growing need for AI workloads, including agentic systems, robotics, and automated operations.
Deloitte indicates the global semiconductor market could achieve approximately $975 billion in yearly sales by 2026, with generative AI chips alone forecasted to provide about $500 billion in revenue.
GPUs, initially developed for graphic rendering, have turned into the foundation of contemporary AI systems due to their capability to execute large-scale computations in parallel.
This renders them crucial for training and deploying LLM and Agentic AI systems. GPUaaS enables organizations to rent compute time by the minute or hour, substantially reducing ownership costs and complexity.
Nonetheless, US-based hyperscalers and semiconductor providers dominate the GPUaaS ecosystem. Giants like Amazon, Google, and Microsoft hold a major segment of global cloud infrastructure.
This dominance heightens the strategic importance of semiconductors. Governments are increasingly balancing export controls with domestic capacity-building as AI technology possession and chip access have become vital to national security, supply chain resilience, and technological sovereignty.
Europe is scaling without ownership
The European Commission, in response, unveiled initiatives like the AI Continent Action Plan, aimed at enhancing Europe’s AI capabilities in large-scale AI data and computing infrastructure, access to quality data, AI development and deployment in strategic sectors, fortifying AI skills and talent, and regulations.
This involves €20 billion for up to five AI gigafactories, as part of a broader €200 billion investment ambition under InvestAI, backed by public and private entities