Microsoft outage intensifies question of Europe's digital dependence on US IT giants

Global outage and its consequences

Microsoft Outlook and Teams users worldwide, including in Europe, this week lost access to email and online meetings due to a global outage. According to the Downdetector service, outages were reported by users in 74 countries and territories. In the UK, some medical practices asked patients to call them for urgent matters. Microsoft said there were no signs of a cyberattack, but has not yet named the root cause of the outage; on Friday, restoration was proceeding in stages. This is already the third Microsoft 365 outage this year — previous outages occurred in January and August.

How dependent is Europe

The outage has once again raised the question of the continent's dependence on a handful of American companies. “This episode once again demonstrates the downsides of such strong dependence on a few large American technology companies,” Tommaso Valletti, professor of economics at Imperial College Business School in London and former chief competition economist of the European Commission (2016–2019), told Euronews Next. According to Synergy Research Group, Amazon, Microsoft and Google together control about 70% of the European cloud market, while European providers account for roughly 15% — down from about 29% in 2017. The largest of them, Germany's SAP and Deutsche Telekom, hold only 2% each. At the same time, according to a Eurobarometer survey, most EU citizens want digital infrastructure to be under European control: support is highest in Sweden (94%), Finland (93%) and Denmark (92%).

Brussels' response and European contenders

Against the backdrop of the outage, Members of the European Parliament on Wednesday presented a draft report on the Cloud and AI Development Act proposed by the European Commission. The document proposes that public authorities procure cloud services from European suppliers more often. “Our critical systems run on someone else's technology, and someone else can switch it off,” warned Dutch Green MEP Reinier van Lanschot. Concerns about a “kill switch” intensified in June, when Anthropic suspended access to the Claude Fable 5 and Mythos 5 models due to US export restrictions; access was restored on July 1. The European Commission also wants to triple the EU's data center capacity within five to seven years: the call for applications to create up to seven EU-backed AI “gigafactories” closed on Thursday. Europe has no single competitor to the American giants, but there are contenders at various levels: France's Mistral AI (valued at €21 billion after a €3 billion round led by Samsung), cloud providers STACKIT (building an €11 billion AI data center in Brandenburg), OVHcloud and Scaleway, as well as Germany's Infineon — a manufacturer of power chips for AI data centers, which analysts at the SEMICON Europa trade show in Munich called Europe's strongest asset in the AI boom.

Are Europeans ready to switch

Willingness to pay more for an EU-based provider varies widely: Danes are the most willing (76%), followed by Swedes and Croats (73% each), while Estonians are the least willing (35%), along with Bulgarians and Czechs (45% each), according to Eurobarometer. Businesses are cautious: according to a survey by the Bitkom association, 85% of German companies believe the country is too dependent on American cloud providers, yet 71% still use their services; according to IDC, only 4% of European organizations plan to work exclusively with local providers. American companies are adapting: in January, Amazon Web Services launched the European Sovereign Cloud in Brandenburg, operated by a separate company based in the EU. Synergy's chief analyst John Dinsdale told CNBC that European providers will find it difficult to win back lost market share. Next, the draft report will be discussed by European Parliament committees on December 1; the vote in the lead committee is provisionally scheduled for mid-March 2027, and the plenary vote for April. Microsoft has promised to publish a report on the cause of the outage after services are fully restored.