European Marketplace for Digital Resources
(Executive Summary)
We propose establishing a European Digital Resources Marketplace as a publicly-traded company with majority EU ownership. This initiative aims to break vendor lock-in practices in digital infrastructure, enhance European digital sovereignty, and foster a competitive environment for local providers. The marketplace will operate under strict regulations ensuring fair competition, data protection, and seamless service provider migration while implementing a transparent taxation system to support continued innovation within the EU.
Why this matters (‘relevance’)
The concept of vendor lock-in has become a defining feature of many modern markets, particularly in the realms of digital infrastructure and consumer electronics. When Apple introduced the iPhone, carriers quickly capitalized on its popularity by offering SIM-locked versions of the device. These phones were tied to specific networks(E.G, Horizon, KPN), preventing users from switching to competitors without going through a tedious and often expensive unlocking process. Carriers reinforced this dependency through subsidies, exclusive deals, and marketing strategies that made the locked versions appear more affordable in the short term. However, users faced higher costs and reduced flexibility over time as they remained bound to a single carrier’s services and pricing structures.
The digital infrastructure market exhibits strikingly similar dynamics. Giants like AWS, Google Cloud, and Microsoft Azure dominate the market by offering extensive, tightly integrated ecosystems. Once an organization commits to one provider, transitioning to another becomes a complex and costly endeavor. Both SIM-locked phones and closed-market digital ecosystems limit consumer choice and stifle competition. Customers find themselves unable to easily switch providers, leading to potential overpayment and reduced innovation as dominant players consolidate their market positions.
A significant consequence of the dominance of AWS, Google, and Microsoft in the digital infrastructure market is the global dependence on US-based providers. This reliance creates vulnerabilities for nations and businesses outside the United States, particularly in Europe. European organizations often choose US providers despite the availability of local alternatives, which are frequently more affordable and competitive in specific niches.
Despite offering cheaper services, European providers face barriers such as lack of investment, insufficient government support, and consumer preference for established players, leading to a failure to compete effectively. The dependence on US-based infrastructure poses geostrategic risks for other nations. If the US government or providers decide to restrict access, the consequences could be catastrophic for businesses and governments reliant on these services. The US could, for political or security reasons, shut down or limit access to its cloud infrastructure. This scenario underscores the risks of centralizing critical resources in one country.
Also, Countries may face difficulties challenging such decisions due to jurisdictional issues and the power imbalance between global corporations and national governments. A recent example is the UK’s lawsuit against Apple, where a trial is underway regarding allegations of exploiting its dominant position through App Store restrictions. This billion-pound case highlights the vulnerabilities inherent in centralized, closed ecosystems and the potential for conflicts when global infrastructure is controlled by a few major players. The case underscores concerns about how such practices harm consumers and stifle competition, drawing attention to the broader issue of vendor lock-in and market failure.
What we are going to do ('actions')
Our core initiative is establishing a European Digital Resources Marketplace as a publicly traded company with 51% of shares owned by the European Union, ensuring democratic control while maintaining market competitiveness. This ownership structure, based on successful governance models, will balance public interest with commercial viability.
The marketplace will operate under a comprehensive regulatory framework designed to prevent vendor lock-in practices. Drawing inspiration from telecommunications regulations, we will implement standardized protocols and interfaces that facilitate seamless migration between service providers. This approach will be complemented by robust support programs for European cloud providers, including targeted investments and technical assistance to enhance their competitiveness against established global players.
Critical to our strategy is the development of policies that protect European digital sovereignty. We will introduce measures to ensure data residency, security standards, and operational resilience that align with EU values and requirements. This includes establishing clear guidelines for cross-border data flows and implementing mechanisms to maintain service continuity during geopolitical disruptions.
Furthermore, we will reform the current tax structure to ensure digital resource revenues contribute fairly to the European economy. This will involve closing existing loopholes that allow revenue diversion through tax havens and establishing a transparent, equitable taxation system that supports continued innovation and infrastructure development within the EU.
What will result ('outcomes')
Enhanced Market Competition: Creation of a more balanced digital infrastructure market with reduced vendor lock-in, enabling easier provider switching and fostering innovation
Digital Sovereignty: Strengthened European digital independence and reduced dependence on US-based providers
Economic Benefits: Improved tax revenue capture from digital services and prevention of revenue diversion through tax havens
Provider Development: Growth of competitive European cloud providers through targeted support and investment
Consumer Protection: Better service options and pricing for consumers through increased market competition and standardized protocols
Where will it lead ('impact')
The establishment of a European Digital Resources Marketplace promises to fundamentally reshape the continent's digital landscape. By creating a more balanced and competitive environment, we expect to see a significant shift in market dynamics, with European providers gaining substantial market share and influence. This transformation will extend beyond immediate economic benefits, fostering a new era of digital innovation and entrepreneurship across the EU.
The long-term impact will be particularly evident in Europe's enhanced digital sovereignty. As local providers grow stronger and more competitive, we anticipate reduced dependence on foreign infrastructure, leading to greater resilience against external pressures and geopolitical risks. This increased autonomy will strengthen Europe's position in international negotiations and technology governance discussions.
Furthermore, the marketplace will serve as a catalyst for technological advancement, creating new opportunities for research, development, and innovation. We expect this to generate numerous high-skilled jobs and contribute to Europe's position as a global leader in digital innovation and data protection standards.
What will it take ('budget')
@Anonymous kind of stuck here. Any suggestions?