Berlin | Angela Merkel has urged Europe to seize control of its data from Silicon Valley tech giants, in an intervention that highlights the EU’s growing willingness to challenge the US dominance of the digital economy.
The German chancellor said the EU should claim “digital sovereignty” by developing its own platform to manage data and reduce its reliance on the US-based cloud services run by Amazon, Microsoft and Google.
“So many companies have just outsourced all their data to US companies,” Ms Merkel told German business leaders.
“I’m not saying that’s bad in and of itself — I just mean that the value-added products that come out of that, with the help of artificial intelligence, will create dependencies that I’m not sure are a good thing.”
Her speech, at an employers’ conference in Berlin, shows the extent to which the information economy is emerging as a battleground in the EU-US trading relationship.
It also highlights the concern in European capitals that the EU could be weakened by the market dominance of the big US tech companies, particularly in the business of storing, processing and analysing data.
Margrethe Vestager, the EU’s powerful competition chief who is now also to oversee EU digital policy, last month told the Financial Times that she was examining whether large internet companies could be held to higher standards of proof in competition cases, as part of a tougher line on dominant companies, such as Google.
Ms Merkel was speaking just two weeks after Berlin unveiled plans for a European cloud computing initiative, dubbed Gaia-X, which it has described as a “competitive, safe and trustworthy data infrastructure for Europe”.
At the conference on Tuesday, Peter Altmaier, economy minister, said the data of companies such as Volkswagen, and that of the German interior ministry and social security system, were increasingly stored on the servers of Microsoft and Amazon. “And in this we are losing part of our sovereignty,” he added.
He said 40 companies had signed up for Gaia-X, including Deutsche Telekom, SAP and Bosch, and the new platform would be ready by the end of the year. “We want to be able to offer companies . . . . ministries and governments the chance to store their data in Europe, according to transparent, clearly recognisable standards.”
But some business groups are sceptical of his plans. “While the intention to strengthen digital sovereignty is absolutely right, there are still big questions — such as how do you combine so many different players in an effective way?” said Susanne Dehmel of the digital lobby group Bitkom.
“It’s also not completely clear to me what the attraction is for service providers to become part of this network, and whether it would really be able to offer customers a competitive alternative to existing suppliers.”
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Mr Altmaier has become a figurehead for efforts to strengthen Europe’s defences against the encroachment of US and Asian tech giants. He recently wrote to Ms Vestager urging her to adopt a harder line on dominant online platforms such as Google and Facebook.
“In the light of current developments in the global data and digital economy, we require tougher oversight of abusive practices in order to maintain competition,” he wrote. “Specific rules of behaviour need to be imposed on market-dominating online platforms.”
Ms Merkel has also long been exercised by the question of digital sovereignty. In speeches over the past couple of years she has underscored the power of the US and China over data, contrasting the American approach — where big companies have come to dominate the business of storing and processing data — with the situation in China, where the state exercises its vast powers to access the data of its citizens.
“Just as with the social market economy, which we in Europe are very proud of, it will probably be necessary for us to find our own path [when it comes to data],” she said in September.
But in Davos last year she complained that Europe was taking too long to find this unique path. “We Europeans have not really decided yet how we want to deal with our data,” she said. “[And] there is a great danger that we end up being too slow, that while we are still debating the philosophical question of data sovereignty, the world just rolls over us.”
Emmanuel Macron has expressed similar fears. In an interview with The Economist published last week, the French president said that in Europe it was companies that decided whether to co-operate with US and Chinese manufacturers on projects such as 5G.
He said if governments allowed this to continue, “in 10 years’ time, no one will be able to guarantee the technological soundness of your cyber-systems, no one will be able to guarantee who processes the data, and how, of citizens or companies”.