Europe is losing its position in digital technologies. In key areas such as cloud services, artificial intelligence, the Internet of Things, and 5G Standalone (SA), it lags significantly behind the USA and China. Only 2% of Europeans have access to full-fledged 5G SA technology, which is the foundation for further development in smart manufacturing, healthcare, transport, and public services. Without this infrastructure, Europe cannot sustain growth, innovation, or living standards. Investment in 5G SA and modernization of regulations must be a priority – otherwise, Europe will only adopt technologies developed elsewhere.
The Digital Networks Act, currently being prepared by the European Commission, represents an opportunity for a fundamental modernization of European telecommunications policy. If it is ambitious, coordinated, and future-oriented, it can help Europe regain a leading position in technology. Without reform, Europe will face further losses in innovation, investment, and talent – with serious consequences for economic growth, social cohesion, and geopolitical sovereignty.
Falling Behind in Productivity and Innovation
Between 2019–2024, productivity in the Eurozone grew by only 0.9%, while in the USA it rose by 6.7%. Innovations are slow to reach practical application – Europe lags far behind in patent applications and research investments. Yet technologies such as AI, biotechnology, and advanced manufacturing require robust digital infrastructure, which Europe often lacks.
5G SA as a Driver of Transformation
Unlike previous mobile technologies, 5G SA is designed for industrial and public applications – enabling low latency, high reliability, and secure connectivity. It supports healthcare (e.g., remote surgery), transport (autonomous driving), agriculture (smart farming), and manufacturing (real-time machine interconnection).
Full deployment of 5G SA could increase EU GDP by €164 billion by 2030. Digitalization of small and medium-sized enterprises – the backbone of the European economy – could bring an additional €628 billion annually.
What Needs to Be Done
Europe’s regulatory framework for telecommunications is outdated. It was designed for voice calls, not today’s data-intensive applications. A true single European market, investment certainty, and proactive engagement by EU member states in supporting new technologies are still lacking. Countries must:
- Invest before demand emerges – following the examples of South Korea, the USA, or China.
- Recognize connectivity as strategic infrastructure – as essential as energy or transport.
- Reform regulatory frameworks – harmonize rules, expand radio spectrum for telecom services, and simplify permitting procedures.
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