Europe at a crossroads
Europe should not define success in the AI era only by whether it wins the frontier-model race. A major opportunity lies in turning AI into productive, resilient and human-centric companies.
The model race matters. It is not the whole race.
Europe should keep investing in research, infrastructure and AI companies. But the AI economy will not be decided there alone. As AI capabilities spread, another competition is opening: who can use them to build better companies.
The model race is not the whole race
The starting point is uneven. The United States and China currently dominate frontier-model production.
The 2026 Stanford AI Index reports that U.S. private AI investment reached $285.9 billion in 2025, compared with $20.92 billion in Europe. The same report describes frontier-model production as concentrated primarily in the United States and China.
That gap matters. Capital, compute, research talent and the ability to scale technology reinforce one another. Europe should not respond by lowering its ambition, but by being clearer about what success means.
If success is defined only as producing a European equivalent of the largest U.S. or Chinese model companies, we risk reducing the AI opportunity to one part of the value chain.
Europe's challenge is turning access into advantage
The same Stanford report also shows something important: European organisations are not absent from AI adoption. In its 2025 survey data, Europe had one of the highest regional rates of organisational AI use.
That creates a more interesting question. If the technology is increasingly accessible, why should access itself become a lasting competitive advantage?
Access alone is unlikely to remain a durable advantage.
As capable models become available to more companies, advantage shifts towards the organisations that can turn those capabilities into better products, stronger operations, faster learning and new business models. The value is created not only in the model, but in what is built around it.
This is where I think Europe has an opportunity to compete differently.
Regulation has to become usable infrastructure
Europe has chosen a more rule-based approach to AI than some other regions. There are legitimate reasons to protect privacy, safety, accountability and fundamental rights. The strategic risk is not that Europe has standards. The risk is that compliance becomes so difficult to translate into practice that responsible companies move too slowly to innovate.
Good governance should therefore become part of the operating model, not a layer added at the end. Clear boundaries, data rules, human accountability and auditability can make deployment safer without turning every experiment into a legal project.
The goal should be a European environment where companies can move quickly inside clear rules, rather than choosing between innovation and responsibility.
A different basis for advantage
The European Commission's Industry 5.0 framing is useful here. It extends the productivity and digitalisation logic of Industry 4.0 with a stronger emphasis on human-centricity, resilience and sustainability.
I do not see that as a softer alternative to competitiveness. Done well, it can help build companies that are productive without becoming more fragile or less accountable.
Europe has deep industrial capabilities, experienced workforces, strong institutions and companies operating in complex real-world environments. Those are useful ingredients if the next phase of AI is increasingly about embedding intelligence into products, operations, knowledge and decision-making.
The Commission's current AI Continent Action Plan also reflects a recognition that Europe needs more infrastructure and investment, including AI factories and planned gigafactories. That is important. But infrastructure only creates value when companies can use it.
The opportunity
Europe does not need to lead every layer of AI technology to build a meaningful advantage. It needs to become better at turning increasingly available AI into better companies.
That means redesigning companies around the technology rather than simply distributing tools to employees. It means combining productivity with human judgement, resilience and responsibility, and using new capacity to make organisations faster to learn and better able to serve customers.
If Europe can do that, AI adoption can become more than a catch-up strategy. It can become a distinct competitive strength.
Europe's opportunity is not only to build AI. It is to build companies that use it better.