European technology leaders are making a bold case for consolidation and efficiency as they push for a more potent global position. At Mobile World Congress (MWC) 2025, CEOs from telecom and artificial intelligence (AI) companies stressed that Europe risks falling behind if it does not streamline its industries and integrate AI advancements into its infrastructure. With competition heating up from the United States and China, executives argue that Europe must rethink its fragmented telecom sector, embrace AI innovation, and implement policies that foster global competitiveness. The message is clear: Europe must consolidate, conserve resources, and compete at the highest level.

What’s Happening & Why This Matters

European Telecom Giants Call for Mergers

Telecom executives took center stage at MWC, pressing for industry consolidation to improve efficiency and investment in next-generation technologies. Vodafone CEO Margherita Della Valle stated that Europe’s fragmented telecom market creates inefficiencies, making it harder to roll out AI-powered infrastructure and advanced connectivity solutions. In contrast, the United States and China have fewer telecom giants, allowing them to scale investments faster.

Telefónica CEO Marc Murtra echoed these concerns, warning that Europe risks losing influence in the global technology race without strategic mergers. He pointed to the difficulty in rolling out 5G networks and AI-driven services due to the overwhelming number of regional telecom providers. European policymakers have long resisted industry consolidation over fears of reduced competition, but executives argue that without scale, innovation stagnates.

AI’s Expanding Role in European Tech Strategy

AI rapidly reshapes industries, and European tech leaders see it as a key to competitiveness. At MWC, AI-powered innovations were a significant focus, with companies unveiling next-generation digital assistants, AI-powered connectivity solutions, and automated network management tools.

Meanwhile, AI is playing a central role in enhancing customer experiences. Deutsche Telekom introduced a new AI-powered phone with built-in tools from Perplexity Assistant and Google Cloud AI, allowing users to manage tasks and communications seamlessly. Google showcased its AI enhancements for Android, including an AI-driven personal shopping assistant that recommends color combinations and fashion choices in real-time.

European Tech’s Regulatory Challenges

While the push for consolidation and AI adoption gains momentum, regulatory challenges remain a stubborn obstacle. European executives argue that complex regulations slow progress and make it harder for companies to compete globally. Deutsche Telekom CEO Peter Höttges pointed to the U.S. Department of Government Efficiency (DOGE) as a model for cutting bureaucracy and fostering rapid tech growth. However, DOGE has been controversial, as its policies have led to massive job cuts across U.S. government agencies.

The European Commission is developing a new Digital Networks Act, which is expected to be unveiled in early 2025. This legislation could ease restrictions on telecom mergers while ensuring consumer protection. Industry leaders hope it will create a more competitive environment, allowing European companies to scale operations and invest in AI-driven infrastructure.

TF Summary: What’s Next

Europe’s tech industry stands at a crossroads. Industry leaders argue that European companies may struggle to compete on the global stage without consolidation, AI integration, and regulatory reform. The push for telecom mergers continues, but policymakers must balance industry growth with consumer protection. If Europe successfully streamlines its telecom and AI strategies, it could strengthen its position in global tech markets. However, without action, it risks being outpaced by the United States and China in AI and next-generation connectivity.

— Text-to-Speech (TTS) provided by gspeech