European Startups and Generative AI: Overcoming Big Tech Dominance
Europe is at a crossroads. Faced with the domination of American Big Tech across the entire generative Artificial Intelligence (AI) value chain, from foundation models to cloud infrastructure, distribution channels, and open source, it risks long-term technological and economic decline. Yet generative AI also represents a major opportunity for economic transformation, with a potential value estimated at 1.5 times France’s gross domestic product (GDP). To turn it into a driver of renewal, Europe must move beyond the illusion of total technological independence and instead build an ecosystem that leverages Big Tech resources while strengthening its own innovation capabilities.
The real opportunity for Europe lies further downstream in the generative AI value chain, where models are adapted to the concrete needs of various sectors, particularly industrial ones. Thanks to its industrial, regulatory, and technical expertise, Europe can carve out lasting competitive advantages here. Rather than chasing an upstream sovereignty, the real challenge is to accelerate AI adoption across sectors by capitalizing on its areas of excellence and nurturing a startup ecosystem that turns cutting-edge technology into practical solutions.
Upstream, the fierce competition between American tech giants paradoxically creates windfall opportunities for Europe. Locked in an investment race, none can afford to slow down despite the risks of overcapacity, pushing them to multiply spending in order to maintain their lead. This dynamic compels Big Tech to offer increasingly favorable access to their tools and infrastructure. European companies can seize this moment to develop innovative solutions at lower costs and monetize them quickly by targeting large markets like the United States.
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European Startups and Generative AI: Overcoming Big Tech Dominance
Author(s)
Hugo LE PICARD
Associate Research Fellow, Center for Geopolitics of Technology, Ifri
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Center for Geopolitics of Technology
Artificial intelligence (AI), 5G, cybersecurity, robotics, semiconductors, space... Technology, especially in the digital domain, is now deeply affecting all human activities and, by extension, international relations. The resulting political, strategic, economic and social issues manifest themselves at multiple political scales involving states, international organizations and private companies. The dynamics of international competition and cooperation are transformed.
It is to respond to these challenges that Ifri is launching the Geopolitics of Technology program in the fall of 2020, which builds on the work it already carried out on these subjects for several years.
The program takes a resolutely European approach to international issues related to so-called critical technologies. Its work is organized around four cross-cutting themes:
- Power: redistributions of power caused by new technologies, in particular digital; military and dual innovations; transformations of international competition;
- Sovereignty: definition of critical infrastructures and technologies; industrial and innovation policies in strategic sectors; opportunities and risks associated with international value chains;
- Governance: ethical and legal issues; interactions between companies, states, international organizations and users; public-private partnerships and GovTech;
- Society: political and social impacts of technological innovations; risks and opportunities for the future of work, health, the fight against climate change; connectivity and economic development.
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