The relationship between US Big Tech and the White House tightened during Donald Trump’s second term, with prominent tech executives such as Jeff Bezos, Mark Zuckerberg, Tim Cook, and Sundar Pichai seen at his inauguration. Elon Musk played a key role in Trump’s campaign and has since become an efficiency tsar in the new regime. However, Trump’s imposition of tariffs has led to a brewing trade war, with the EU ready to retaliate by threatening to tariff US services if negotiations break down. The EU considers Europe a lucrative market for Big Tech and is exploring ways to hit tech companies like Meta, Google, and Facebook.
The EU has implemented landmark laws, the Digital Services Act (DSA) and Digital Markets Act (DMA), which regulate illegal content online and digital market distortion. These rules have faced criticism from US Big Tech, with the Trump administration accusing the EU of waging “lawfare” against American companies. Investigations under the DSA and DMA have been ongoing, with potential fines of up to 6% of a company’s annual global revenue. The EU has stated that these probes are conducted strictly according to regulations and do not discriminate based on country of origin, but most companies under scrutiny are American.
Elon Musk’s Starlink satellite infrastructure has been drawn into the trade war, as several EU countries seek to reduce their strategic dependency on Musk’s satellites. Starlink has played a crucial role in providing internet connectivity in conflict zones, such as Ukraine, but remains largely absent from European households due to cost and speed issues. The EU is exploring developing its own alternatives, such as the IRIS2 project, to compete with Starlink and reduce reliance on external technological superpowers like the US and China.
Some EU member states, including France and Germany, are considering imposing a digital tax on Big Tech as part of their response to potential US tariffs. French economy minister Eric Lombard suggested regulating Big Tech’s use of data through taxation, while Ursula von der Leyen has indicated readiness to introduce a tax on digital advertising revenues. The EU could also deploy its anti-coercion tool to withdraw licenses and intellectual property rights from foreign companies as a means of hitting Big Tech. However, taxing US tech services may raise questions about European tech sovereignty and resilience.
The COVID-19 pandemic and Russia’s aggression in Ukraine have led the EU to push for a “tech sovereignty” agenda to reduce dependence on overseas regions, particularly in the tech sector. However, the EU’s efforts to achieve digital sovereignty have seen limited progress, with most cloud services still controlled by US companies. Member states are exploring strategies to strengthen government digital autonomy and limit dependency on a few tech giants. Targeting US Big Tech in the meantime could potentially undermine the EU’s efforts to achieve tech sovereignty and competitiveness.
Overall, the relationship between US Big Tech and the EU is strained due to potential tariffs and tax measures as part of a brewing trade war. The EU is exploring ways to hit tech companies like Meta, Google, and Facebook, while also seeking to reduce dependency on external technological superpowers like the US and China. Efforts to achieve digital sovereignty face challenges, as most cloud services remain in the hands of US players, and targeting US Big Tech could raise questions about the bloc’s tech resilience and autonomy.
